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What changed in ASTEC INDUSTRIES INC's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of ASTEC INDUSTRIES INC's 2024 and 2025 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 2025 report.

+424 added−406 removedSource: 10-K (2026-02-25) vs 10-K (2025-02-26)

Top changes in ASTEC INDUSTRIES INC's 2025 10-K

424 paragraphs added · 406 removed · 87 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

54 edited+34 added−28 removed33 unchanged
Biggest changeBeginning January 1, 2024, Astec Digital, which was previously included in the Corporate and Other category, is reported in the Infrastructure Solutions segment while the Australia and Chile ("LatAm") sites, which were previously included in the Infrastructure Solutions segment, are reported in the Materials Solutions segment. 3 Table of Content s Products and Services The primary products produced and services provided by the Infrastructure Solutions segment include: Asphalt plants and related components Heaters Concrete dust control systems Asphalt pavers Vaporizers Concrete material handling systems Screeds Heat recovery units Paste back-fill plants Asphalt storage tanks Hot oil heaters Bagging plants Fuel storage tanks Industrial and asphalt burners and systems Blower trucks and trailers Material transfer vehicles Soil stabilizing/reclaiming machinery Wood chippers and grinders Milling machines Soil remediation plants Control systems Pump trailers Concrete batch plants Service, construction and retrofits Liquid terminals Storage equipment and related parts Engineering and environmental permitting services Polymer plants Concrete mixers Cold central plant recycle systems Industrial automation controls Telematics platforms As the backbone of road infrastructure development, asphalt and concrete mixing plants play a crucial role in the construction industry.
Biggest changeProducts and Services The primary products produced and services provided by the Infrastructure Solutions segment include: Product Categories Products Asphalt • Asphalt plants • Cold central plant recycle systems • Soil remediation plants • Engineering and environmental permitting services • Major plant components Concrete • Concrete batch plants • Bagging plants • Paste back-fill plants • Concrete mixers • Major plant components Heating and Combustion • Fuel and liquid asphalt storage tanks • Liquid asphalt terminals • Thermal fluid heaters • Polymer plants • Heat recovery units • Industrial and asphalt burners and systems Road Construction and Forestry • Asphalt pavers • Material transfer vehicles • Milling machines • Wood chippers and grinders • Blower trucks and trailers Astec Digital • Industrial automation controls • Telematics platforms 3 Table of Contents Asphalt - A typical asphalt mixing plant comprises various components, including heating and storage equipment for liquid asphalt, cold feed bins for aggregate blending, a counter-flow continuous dryer drum, an emissions control bag house, hot storage bins and a control house.
Additionally, high-capacity rail and barge loading/unloading material handling systems are an important part of our product lines. We have created our rock breaking equipment line for aggregate, mining, construction and demolition applications, including the demolition and recycling of buildings, bridges and roads.
Additionally, high-capacity rail and barge loading/unloading material handling systems are an important part of our product lines. Breaking - We have created our rock breaking equipment line for aggregate, mining, construction and demolition applications, including the demolition and recycling of buildings, bridges and roads.
Unions also represent approximately 12 percent of our employees at our facilities outside the U.S. We consider our employee relations to be good. Compensation and Benefits As an employer of choice, we provide competitive and robust compensation and benefits. We achieve this by regularly conducting market reviews and adjusting as needed.
Unions also represent approximately nine percent of our employees at our facilities outside the U.S. We consider our employee relations to be good. Compensation and Benefits As an employer of choice, we provide competitive and robust compensation and benefits. We achieve this by regularly conducting market reviews and adjusting as needed.
Marketing The principal purchasers of aggregate processing equipment include distributors, highway and heavy equipment contractors, sand and gravel producers, demolition, recycling and crushing contractors, open mine operators, quarry operators, port and inland terminal authorities, power stations and both domestic and foreign governmental agencies.
Marketing The principal purchasers of materials processing equipment include distributors, highway and heavy equipment contractors, sand and gravel producers, demolition, recycling and crushing contractors, open mine operators, quarry operators, port and inland terminal authorities, power stations and both domestic and foreign governmental agencies.
We also offer industrial automation controls and telematics platforms as well as manufacturing certain equipment and components unrelated to road construction, including equipment for the mining, quarrying, construction, demolition, land clearing and recycling industries and port and rail yard operators; industrial heat transfer equipment; commercial whole-tree pulpwood chippers; horizontal grinders; blower trucks; commercial and industrial burners; and combustion control systems.
We also offer industrial automation controls and telematics platforms as well as manufacturing certain equipment and components unrelated to road construction, including equipment for the mining, quarrying, construction, demolition, land clearing, energy, hydro-electric and recycling industries and port and rail yard operators; industrial heat transfer equipment; commercial whole-tree pulpwood chippers; horizontal grinders; blower trucks; commercial and industrial burners; and combustion control systems.
Materials Solutions manufacturing operations are primarily located in the United States, Brazil, Canada, South Africa and the United Kingdom. Locations in Australia, Chile and Thailand function to market, service and install equipment and provide parts in the regions in which they operate for many of the products produced by all of our manufacturing sites.
Materials Solutions manufacturing operations are primarily located in the United States, Brazil, Canada, South Africa, India, China and the United Kingdom. Locations in Australia, Chile, Thailand and Sweden function to market, service and install equipment and provide parts in the regions in which they operate for many of the products produced by all of our manufacturing sites.
While specific competitors are named within each business segment discussion above, imports do not generally constitute significant competition for us in the United States, except for milling machines and track-mounted crushers. In 8 Table of Content s international sales, however, we often compete with foreign manufacturers that may have a local presence in the market we are attempting to penetrate.
While specific competitors are named within each business segment discussion above, imports do not generally constitute significant competition for us in the United States, except for milling machines and track-mounted crushers. In international sales, however, we often compete with foreign manufacturers that may have a local presence in the market we are attempting to penetrate.
Approximately 73 of our active U.S. employees are covered by a collective bargaining agreement with the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union, AFL-CIO-CLC on behalf of its local affiliate Local Union No. 11-508-03, with an expiration date of December 11, 2025.
Approximately 84 of our active U.S. employees are covered by a collective bargaining agreement with the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union, AFL-CIO-CLC on behalf of its local affiliate Local Union No. 11-508-03, with an expiration date of December 12, 2028.
Backlog As of December 31, 2024 and 2023, the backlog for the Materials Solutions segment was approximately $114.1 million and $205.1 million, respectively. Corporate and Other The Corporate and Other category consists primarily of the parent company and the captive, which do not meet the requirements as an operating segment or inclusion in one of the other reporting segments.
Backlog As of December 31, 2025 and 2024, the backlog for the Materials Solutions segment was approximately $219.9 million and $114.1 million, respectively. Corporate and Other The Corporate and Other category consists primarily of the parent company and the captive, which do not meet the requirements as an operating segment or inclusion in one of the other reporting segments.
The BG-Series is offered in a variety of production rates to accommodate the smallest jobs to large projects. The BG-Series is capable of utilizing high percentages of RAP and offers the versatility of a batch plant. A number of these plants are operating in various countries around the world.
The plant features a containerized design which simplifies shipping and transportation. The BG-Series is offered in a variety of production rates to accommodate the smallest jobs to large projects. The BG-Series is capable of utilizing high percentages of RAP and offers the versatility of a batch plant. A number of these plants are operating in various countries around the world.
Our comprehensive range of rock breaker boom systems are designed to break oversized material at large gyratories, grizzlies and primary/secondary crushing application sites. These systems 6 Table of Content s include boom-mounted configurations, automatic greasing packages, motor starter panels, joystick controls and easy plant integration.
Our comprehensive range of rock breaker boom systems are designed to break oversized material at large gyratories, grizzlies and primary/secondary crushing application sites. These 6 Table of Contents systems include boom-mounted configurations that may be operated remotely, automatic greasing packages, motor starter panels, joystick controls and easy plant integration.
Raw Materials We purchase raw materials, manufactured components and replacement parts for our products from leading suppliers both domestically and internationally. Raw materials used in the manufacture of our products include carbon steel in flat rolled, long products and pipe as well as various types of alloy steel. Our steel suppliers include mills, distributors and other sources.
Raw Materials We purchase raw materials, manufactured components and replacement parts for our products from leading suppliers both domestically and internationally. Raw materials used in the manufacture of our products include carbon steel in flat rolled, long 7 Table of Contents products and pipe as well as various types of alloy steel.
We also have 124 trademarks registered in foreign jurisdictions, including Argentina, Australia, Brazil, Canada, Chile, China, the European Union, France, Germany, India, Italy, Kazakhstan, Mexico, New Zealand, Paraguay, Peru, Russia, South Africa, South Korea, Taiwan, Thailand, the United Kingdom, Ukraine, Uruguay and Vietnam. We have 12 United States and 3 foreign trademark registration applications pending.
We also have 188 trademarks registered in foreign jurisdictions, including Argentina, Australia, Brazil, Canada, Chile, China, Colombia, the European Union, France, Germany, India, Indonesia, Italy, Kazakhstan, Mexico, New Zealand, Paraguay, Peru, Russia, South Africa, South Korea, Spain, Taiwan, Thailand, the United Kingdom, Ukraine, Uruguay and Vietnam. We have seven United States and one foreign trademark registration applications pending.
Employee Profile As of December 31, 2024, we employed 4,148 individuals, including 3,419 employees in the U.S. and Canada. We also retain consultants, independent contractors and temporary and part-time workers.
Employee Profile As of December 31, 2025, we employed 4,468 individuals, including 3,679 employees in the U.S. and Canada. We also retain consultants, independent contractors and temporary and part-time workers.
To date, we have launched the human capital resources module in our U.S. locations and converted the operations of three manufacturing sites along with Corporate, two of which occurred during the second quarter of 2024. Business Segments We operate manufacturing sites and sites that operate as sales and service offices for our manufacturing locations.
To date, we have launched the human capital resources module in our U.S. and Canadian locations and converted the operations of three manufacturing sites along with Corporate. Business Segments We operate manufacturing sites and sites that operate as sales and service offices for our manufacturing locations.
Materials Solutions equipment and aftermarket sales and service programs are primarily marketed through an extensive network of dealers via dealer support sales employees, domestic and international independent distributors and our international distribution sites in each of our reportable segments. Competition The Materials Solutions segment faces strong competition in price, service and product performance.
Materials Solutions equipment and aftermarket sales and service programs are primarily marketed through an extensive network of dealers via dealer support sales employees, domestic and international independent distributors and our international distribution sites in each of our reportable segments.
As of December 31, 2024, the functional representation of our employees was as follows: 2,626 were engaged in manufacturing, 431 in engineering, including support staff, and 1,091 in selling, administrative and management functions. Unions are certified as bargaining agents for approximately two percent of our U.S. direct employees.
As of December 31, 2025, the functional representation of our employees was as follows: 3,085 were engaged in manufacturing, 367 in engineering, including support staff, and 1,016 in selling, administrative and management functions. Unions are certified as bargaining agents for approximately two percent of our U.S. direct employees.
In addition to manufacturing core Materials Solutions products and asphalt plants, Belo Horizonte, our Brazilian site, markets all our products to the Brazilian market. As of December 31, 2024, we had an ownership interest of approximately 93% in Belo Horizonte.
In addition to manufacturing core Materials Solutions products and asphalt plants, Belo Horizonte, our Brazilian site of which we own approximately 93% as of December 31, 2025, markets all our products to the Brazilian market.
The Company's presentation of Segment Operating Adjusted EBITDA may not be comparable to similar measures used by other companies and is not necessarily indicative of the results of operations that would have occurred had each reportable segment been an independent, stand-alone entity during the periods presented.
The Company's presentation of Segment Operating Adjusted EBITDA is not necessarily indicative of the results of operations that would have occurred had each reportable segment been an independent, stand-alone entity during the periods presented.
In addition to salaries, we provide regional programs, which can include annual bonuses, share-based compensation awards, a 401(k) plan with employee matching opportunities, healthcare and insurance benefits, health savings and flexible spending accounts, paid time off, family and parental leave, family care resources, flexible work arrangements, employee assistance programs, tuition assistance and on-site services.
In addition to salaries, we provide regional programs, which can include annual bonuses, share-based compensation awards, a 401(k) plan with employee matching opportunities, healthcare and insurance benefits, health savings and flexible spending accounts, paid time off, family and parental leave, family care resources, flexible work arrangements, employee assistance programs, tuition assistance and on-site services. 9 Table of Contents Health and Safety Astec views safety as a cornerstone of our operations, reflecting our dedication to protecting our employees, stakeholders and the communities we serve.
Our subsidiaries have 10 United States and 23 foreign patent applications pending. We have 77 trademarks registered in the United States, including logos for Astec, Carlson Paving, Heatec, KPI-JCI, Peterson Pacific, Power Flame, Roadtec and Telsmith, and the names ASTEC, CARLSON, HEATEC, JCI, KOLBERG, PETERSON, POWER FLAME, ROADTEC and TELSMITH, as well as a number of other product names.
We have 83 trademarks registered in the United States, including logos for Astec, Carlson Paving, Elgin, Gundlach Crushers, Heatec, Jeffrey Rader, KPI-JCI, Pennsylvania Crusher, Peterson Pacific, Power Flame, Roadtec and Telsmith, and the names ASTEC, CARLSON, ELGIN, GUNDLACH CRUSHERS, HEATEC, JCI, JEFFREY RADER, KOLBERG, PETERSON, PENNSYLVANIA CRUSHER, POWER FLAME, ROADTEC and TELSMITH, as well as a number of other product names.
We are continuing to build on that legacy by: • Focusing on innovation with a new product development approach that increases our market competitiveness over time. • Leveraging technology and digital connectivity to enhance the customer experience through controls and automation and other technologies. • Developing the Astec Digital Ecosystem to enable customers to leverage our entire product portfolio and associated data. 2 Table of Content s Strategic Transformation Program Our strategic transformation program includes the ongoing multi-year phased implementation of a standardized enterprise resource planning ("ERP") system, which is replacing much of our existing disparate core financial systems.
We are continuing to build on that legacy by: • Focusing on innovation with a new product development approach that increases our market competitiveness over time. • Leveraging technology and digital connectivity to enhance the customer experience through controls and automation and other technologies. 2 Table of Contents • Developing the Astec Digital Ecosystem to enable customers to leverage our entire product portfolio and associated data.
We strive to create an environment that attracts top talent and where high performance is fostered and thrives, continuous learning is engrained, diverse experience is leveraged as a competitive advantage and careers are propelled forward. We utilize our High Performance Framework process to ensure company-wide alignment to achieve company goals and targets.
Talent Development Talent and Diversity are key components of our OneASTEC business model. We strive to create an environment that attracts top talent and where high performance is fostered and thrives, continuous learning is engrained, diverse experience is leveraged as a competitive advantage and careers are propelled forward.
This model includes values, professional development and cascaded common performance goals. We provide all employees a wide range of professional development experiences, both formal and informal, at various stages in their careers. Specifically, we offer leadership training to all employees at the supervisor and manager level worldwide.
We utilize our High Performance Framework process to ensure company-wide alignment to achieve company goals and targets. This model includes values, professional development and cascaded common performance goals. We provide all employees a wide range of professional development experiences, both formal and informal, at various stages in their careers.
This training focuses on building key leadership competencies including leading diverse and inclusive teams. In addition, talent development and succession planning for critical roles is a cornerstone of our talent program. Development plans are created and monitored for critical roles to ensure progress is made along the established timelines.
Specifically, we offer leadership training to all employees at the supervisor and manager level worldwide. This training focuses on building key leadership competencies including leading diverse and inclusive teams. In addition, talent development and succession planning for critical roles is a cornerstone of our talent program.
Corporate and Available Information Astec Industries, Inc. is a Tennessee corporation which was incorporated in 1972.
These efforts touch all levels of our organization including our Board of Directors. Corporate and Available Information Astec Industries, Inc. is a Tennessee corporation which was incorporated in 1972.
These machines are used to crush large, over-sized material in mining, quarrying, sand and gravel and asphalt/concrete recycling applications. Once the material is crushed to size, it is utilized in a variety of products from road base to golf course sand. We offer cone crushers with both roller-bearing and bushing style cones to fit any customer’s needs.
Once the material is crushed to size, it is utilized in a variety of products from road base to golf course sand. We offer cone crushers with both roller-bearing and bushing style cones to fit any customer’s needs. Our industry-leading hydraulic-relief jaw crushers offer enhanced safety and easy maintenance.
Our high frequency screens utilize a high-speed vibration directly induced into the screen media to improve screening efficiency and production rates. The screens' unique rotary tensioning system allows for quick media changes. Our screens are available in multiple sizes with up to four decks and in a variety of configurations including stationary, portable and mobile.
The screens' unique rotary tensioning system allows for quick media changes. Our screens are available in multiple sizes with up to four decks and in a variety of configurations including stationary, portable and mobile. Washing - Our washing and classifying equipment is well-suited for a wide range of applications and production goals.
To effectively manage inventory at our manufacturing facilities, we purchase a substantial portion of carbon steel products on a just in time basis.
Our steel suppliers include mills, distributors and other sources. To effectively manage inventory at our manufacturing facilities, we purchase a substantial portion of carbon steel products on a just in time basis. When market dynamics warrant, we strategically and selectively order inventory items beyond a just in time basis.
We aspire to reduce recordable injuries and lost time each year and have added safety resources at all our sites and within our corporate structure to improve our overall safety program. During the year ended December 31, 2024, we had zero recordable injuries at three of our manufacturing sites.
To support this objective, we have strengthened our safety resources across all sites and within our corporate structure to improve our overall safety program. During the year ended December 31, 2025, four of our manufacturing facilities achieved zero recordable injuries.
Certain orders for which we have received binding letters of intent or contracts will not be included in backlog until all required contractual documents and deposits are received. As of December 31, 2024 and 2023, we had a backlog for delivery of products at certain dates in the future of approximately $419.6 million and $569.8 million, respectively.
Certain orders for which we have received binding letters of intent or contracts will not be included in backlog until all required contractual documents and deposits are received.
Competition This industry segment faces strong competition in price, service and product performance.
Competition This industry segment is highly competitive and fragmented and faces strong competition in product performance, product innovation, range of products offered, service and price.
Seasonality and Backlog Revenues have historically been strongest during the first, second and fourth quarters with the third quarter typically generating weaker results. Backlog represents the dollar value of firm orders for equipment, parts and related installation which are expected to be recognized in net sales in the future.
Backlog represents the dollar value of firm orders for equipment, parts and related installation which are expected to be recognized in net sales in the future.
Focus on Sustainability We manufacture certain equipment with engines that meet the Environmental Protection Agency ("EPA") Tier 4 Final and the European Stage V emissions standards that are compatible with hydrotreated vegetable oil ("HVO") fuels, a direct drop-in alternative to conventional diesel fuel.
Environmental Protection Agency ("EPA") Tier 4 Final and the European Stage V emissions standards that are compatible with hydrotreated vegetable oil ("HVO") fuels, a direct drop-in alternative to conventional diesel fuel. While the energy content produced by HVO fuels is less than conventional diesel, HVO fuels offer reduced net carbon emissions with no need for upfront equipment modifications.
Our portable asphalt plants offer high production capacity, reclaimed asphalt pavement ("RAP") mixing capabilities and compact, highly mobile designs. The BG-Series is a line of batch plants specifically designed for the global market. The plant features a containerized design which simplifies shipping and transporting the plant.
While our large asphalt plants excel in the North American market, we have designed single-load and single-chassis portable plants tailored for international markets. Our portable asphalt plants offer high production capacity, RAP mixing capabilities and compact, highly mobile designs. The BG-Series is a line of batch plants specifically designed for the global market.
The Materials Solutions segment's primary competitors include the following as well as smaller manufacturers, both domestic and international: CDE Group McCloskey International (part of Metso Outotec Corporation) Terex Corporation Deister Machine Company, Inc McLanahan Corporation Thor Manufacturing Ltd. Epiroc Metso Outotec Corporation Weir Group EDGE Innovate Sandvik Group Wirtgen Group (a John Deere Company) Masaba, Inc. Superior Industries, Inc.
Terex Corporation Conn-Weld Industries, LLC McCloskey International (part of Metso Corporation) Thor Manufacturing Ltd. Deister Machine Company, Inc. McLanahan Corporation The Weir Group PLC Epiroc Metso Corporation Wirtgen Group (a John Deere Company) EDGE Innovate, LTD Sandvik Group FLSmidth & Co A/S Superior Industries, Inc.
One of our core values - Respect - reflects the behavior we strive to include in every aspect of the way we conduct business. We recognize that our best performance comes when our teams are diverse and inclusive. These efforts touch all levels of our organization including our Board of Directors.
Development plans are created and monitored for critical roles to ensure progress is made along the established timelines. One of our core values - Respect - reflects the behavior we strive to include in every aspect of the way we conduct business. We recognize that our best performance occurs when our teams are diverse and inclusive.
Our customers generally offer both asphalt and concrete surfacing options, and our product portfolio enables us to be a singular provider to our customers for both asphalt and concrete equipment.
Our customers generally offer both asphalt and concrete surfacing options, and our product portfolio enables us to be a singular provider to our customers for both asphalt and concrete equipment. Patents and Trademarks We seek to obtain patents to protect the novel features of our products and processes. Our subsidiaries hold 117 United States patents and 160 foreign patents.
The Infrastructure Solutions segment's primary competitors include the following as well as smaller manufacturers, both domestic and international: Product Categories Primary Competitors Asphalt plants and related components • Asphalt Drum Mixers Inc • Asphalt Equipment Company Inc. dba ALmix • Ammann Group • Gencor Industries, Inc • Benninghoven (part of Wirtgen Group, a John Deere Company) Concrete equipment • ERIE Strayer Company • Stephens Manufacturing • Vince Hagan Co.
The Infrastructure Solutions segment's primary competitors include, without limitation, the following as well as a number of smaller manufacturers, both domestic and international: Asphalt Drum Mixers LLC (part of Fayat Group) Diamond Z Morbark, LLC (part of Alamo Group) Asphalt Equipment Company Inc. dba ALmix Doppstadt Stephens Manufacturing Company Ammann Group Dynapac (part of Fayat Group) Tigercat Industries Bandit Industries, Inc.
Engineering and Product Development We conduct research and development activities to develop new products and to enhance the functionality, effectiveness, ease of use and reliability of our existing products.
Compliance with these government regulations has not had a material effect on our capital expenditures, earnings or competitive position within the market to date. Engineering and Product Development We conduct research and development activities to develop new products and to enhance the functionality, effectiveness, ease of use and reliability of our existing products.
In conjunction with the Materials Solutions products, we offer consulting and engineering services to provide complete "turnkey" processing systems, which often include electrical control centers and plant automation products that we produce. Our complete line of primary, secondary, tertiary and quaternary crushers includes jaw crushers, horizontal shaft impactors, vertical shaft impactors, cone crushers and heavy-duty, mining-application crushers.
In conjunction with the Materials Solutions products, we offer consulting and engineering services to provide complete "turnkey" processing systems, which often include electrical control centers and plant automation products that we produce. Focus on Sustainability We manufacture certain equipment with engines that meet the U. S.
Customized concrete plants are engineered to fit within job site constraints across a wide range of concrete production applications. Our patented water injection warm mix asphalt system stands out as a revolutionary advancement. This system allows the preparation and placement of asphalt mix at lower temperatures, resulting in substantial emissions reduction during paving and load-out.
Our patented water injection warm mix asphalt system stands out as a significant advancement over previous technologies. This system allows the preparation and placement of asphalt mix at lower temperatures, resulting in substantial emissions reduction during paving and load-out. Our multi-nozzle device eliminates the need for costly additives by creating microscopic bubbles through the mixing of water and asphalt cement.
When market dynamics warrant, we strategically and selectively order inventory items beyond a just in time basis. 7 Table of Content s Although raw materials for manufacturing are normally readily available, certain highly customized components may require longer than normal lead times such as engines, gearboxes, and hydraulic and electronic systems.
Although raw materials for manufacturing are normally readily available, certain highly customized components may require longer than normal lead times such as engines, gearboxes, and hydraulic and electronic systems. Parts and Services We offer a wide-ranging portfolio of stocked OEM and aftermarket parts, specifically designed for Astec equipment as well as premium best-fit parts for competitive machines.
The mobile, self-propelled material transfer vehicle, known as the "Shuttle Buggy," allows for continuous paving, reducing time and haul trucks required while keeping asphalt mix temperatures consistent to create a smooth, durable finished product. 4 Table of Content s While our large asphalt plants excel in the North American market, we have designed single-load and single-chassis portable plants tailored for international markets.
Our mobile, self-propelled material transfer vehicle, known as the shuttle buggy, enables continuous paving operations, which reduces both the time and number of haul trucks required. Additionally, it maintains consistent asphalt mix temperatures, resulting in a smooth and durable finished product.
Our washing and classifying equipment is well-suited for a wide range of applications and production goals. Our expertly engineered components and plants help producers meet the most stringent material specifications and get the most out of their material, while significantly decreasing water usage.
Our expertly engineered components and plants help producers meet the most stringent material specifications and get the most out of their material, while significantly decreasing water usage. We offer solutions for any operation in portable and stationary configurations. In addition, our classifying systems are used to separate solids from liquids for further processing.
We believe that our engineering and research and development efforts are key drivers of our success in the marketplace and dedicate substantial resources to engineering and product development activities including establishing an Innovation Services team. Our Innovation Services team has experts in advanced fields, such as simulation and digital twin creation, who support our development initiatives.
We believe that our engineering and research and development efforts are key drivers of our success in the marketplace and dedicate substantial resources to engineering and product development activities. Our Advanced Technologies Group develops emerging technologies including cloud-based engineering simulation, extended reality for operator training and service support and analytics driven by artificial intelligence and machine learning.
Approximately $112.2 million of the decline in backlog between periods relates to orders from domestic customers. Competition Each business segment operates in domestic markets that are highly competitive with respect to price, service and product quality.
As of December 31, 2025 and 2024, we had a backlog for delivery of products at certain dates in the future of approximately $514.1 million and $419.6 million, respectively. 8 Table of Contents Competition Each business segment operates in domestic markets that are highly competitive with respect to price, service and product quality.
Our burner portfolio has the ability to achieve the most stringent emissions and efficiency requirements for a variety of projects. Our mixing plants boast fully automated components, incorporating microprocessor-based and programmable logic control systems for optimal efficiency. As part of our commitment to environmental responsibility, these plants are manufactured to meet or exceed federal and state clean air standards.
Environmental Solutions - We offer various environmental solutions across many of the product categories above. Our mixing plants are equipped with fully automated components that utilize microprocessor-based and programmable logic control systems to achieve optimal efficiency throughout the production process. These plants are manufactured to meet or exceed federal and state clean air standards, ensuring compliance while supporting sustainability initiatives.
Our F-Series pavers also feature a significant noise reduction over previous models, efficiency improvements in the cooling and hydraulic systems and an articulating track frame that, in addition to operator comfort, will also further improve the high quality road smoothness reputation of our pavers.
Road Construction and Forestry - The F-Series pavers offer notable noise reduction, enhanced efficiency in both cooling and hydraulic systems and an articulating track frame. This frame improves operator comfort and further elevates the reputation of our pavers for delivering exceptionally smooth road surfaces.
Milling equipment • Bomag (part of Fayat Group) • Caterpillar Paving Products (part of Caterpillar, Inc.) • CMI Roadbuilding • Dynapac (part of Fayat Group) • Wirtgen Group (a John Deere Company) Forestry and recycling equipment • Bandit Industries, Inc. • Diamond Z • Doppstadt • EDGE Innovate • Tigercat • Morbark (part of Alamo Group) Backlog The backlog for the Infrastructure Solutions segment as of December 31, 2024 and 2023 was approximately $305.5 million and $364.7 million, respectively. 5 Table of Content s Materials Solutions Segment Overview The Materials Solutions segment designs and manufactures heavy rock processing equipment, in addition to servicing and supplying parts for the aggregate, mining, recycling, ports and bulk handling markets.
Caterpillar Paving Products (part of Caterpillar, Inc.) LeeBoy (part of Fayat Group) Wirtgen Group (a John Deere Company) CMI Roadbuilding Inc. 5 Table of Contents Backlog The backlog for the Infrastructure Solutions segment as of December 31, 2025 and 2024 was approximately $294.2 million and $305.5 million, respectively.
Paving and related equipment • Bomag (part of Fayat Group) • Caterpillar Paving Products (part of Caterpillar, Inc.) • Dynapac (part of Fayat Group) • LeeBoy • Vogele (part of Wirtgen Group, a John Deere Company) • Weiler Inc.
EDGE Innovate, LTD The Vince Hagan Company Benninghoven (part of Wirtgen Group, a John Deere Company) ERIE Strayer Company Vogele (part of Wirtgen Group, a John Deere Company) Bomag (part of Fayat Group) Gencor Industries, Inc Weiler Inc.
Our material handling products cover many applications and are designed for efficiency and high-capacity material transferring, moving and mixing. Our innovative line of material handling solutions includes radial and telescoping conveyors, truck unloaders, hopper feeders, mobile conveyors, pugmills, ship loaders and unloaders, bulk receptions feeders and stationary conveying systems.
Material Handling - We design and manufacture a broad range of material and bulk handling products for all production goals. Our material handling products cover many applications and are designed for efficiency and high-capacity material transferring, moving and mixing.
Our commitment to safety extends beyond our facilities to encompass the entire supply chain, fostering a holistic approach to risk management.
Our commitment to safety extends beyond our facilities to encompass our entire supply chain, reinforcing a holistic approach to risk management that supports long-term sustainability and operational excellence. We take a proactive stance in identifying an addressing potential hazards through leading indicators.
Horizontal grinders are used to create mulch from green waste for water retention, erosion control and compost for soil amendments. Our horizontal grinders allow the diversion of low value material away from landfills and conversion to high value saleable product for our customers.
Our horizontal wood grinders, disc and drum chippers, as well as blower trucks and trailers, are instrumental in diverting green waste from landfills. Horizontal grinders are utilized to process green waste into mulch, which aids in water retention, erosion control and compost production for soil amendments.
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During 2024, we modified the pace of deployment of future site conversions to improve efficiencies and reduce business disruptions at our manufacturing sites, which will reduce the scope of the program to exclude sites outside North America.
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In furtherance of our Vision and strategic pillars, we completed the acquisition of TerraSource Holdings, LLC (“TerraSource”), a market-leading manufacturer of material processing equipment and related aftermarket parts serving complementary crushing, screening and separation applications on July 1, 2025 and the acquisition of CWMF, LLC, a manufacturer of portable and stationary asphalt plant equipment and parts on January 1, 2026.
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Infrastructure Solutions manufacturing operations are primarily located in the United States and Canada. Our India site services and installs equipment and provides parts in the region in which it operates for many of the products produced by all of the Company's manufacturing sites.
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A further discussion of these acquisitions is included in Part II, Item 8. Financial Statements and Supplementary Data of this Annual Report on Form 10-K. Strategic Transformation Program Our strategic transformation program includes the ongoing multi-year phased implementation of a standardized enterprise resource planning ("ERP") system, which is replacing much of our existing disparate core financial systems.
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Astec Digital, which is included in the Infrastructure Solutions segment, is responsible for the development and delivery of the Astec Digital Ecosystem which enables customers to leverage our product portfolio and associated data to provide insight into their operations.
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Infrastructure Solutions products are designed to enhance efficiency, safety and sustainability in the construction process. Infrastructure Solutions manufacturing operations are primarily located in the United States and Canada.
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Our focus is to connect all Astec products to the Astec Digital Ecosystem and leverage this data to create a competitive advantage for our customers that can allow them to be more efficient, productive and sustainable. Astec Digital has locations in Belgium, Canada, France, the United Kingdom and the United States.
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Batch plants are designed for producing high-quality asphalt mixes in batches, which ensure precise control over mix components and allows for customization to meet specific project requirements. Drum mix plants focus on continuous production and are ideal for high-volume projects, offering both efficiency and flexibility in asphalt production.
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We have been at the forefront of introducing groundbreaking innovations that have reshaped the landscape of asphalt and concrete production since our inception.
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In addition to these core plant types, our product line includes recycling equipment that enables the reuse of reclaimed asphalt pavement ("RAP"). This capability promotes sustainability and cost-effectiveness by reducing the need for new raw materials and supporting environmentally responsible construction practices.
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A typical asphalt mixing plant comprises various components, including heating and storage equipment for liquid asphalt, cold feed bins for aggregate blending, a counter-flow continuous dryer drum, an emissions control baghouse, hot storage bins and a control house. In 1979, we introduced the concept of high plant portability, revolutionizing asphalt plants.
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Concrete - Our product lineup includes stationary dry-batch concrete plants, which are designed to precisely measure and feed various ingredients into a ready-mix truck, allowing the mixing process to occur on the way to a job site. Stationary plants can be customized and engineered to fit within job site constraints, supporting a wide range of concrete production applications.
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The current generation features six or more portable components designed for easy transportation between construction sites. This innovation can serve to significantly reduce relocation expenses and operational interruptions. Our Portable Self-Erect Cement Bins for the concrete industry provide low-profile mobile cement storage and ship pre-wired and pre-plumbed for quick setup.
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Stationary central-mix concrete plants measure, feed and mix ingredients into liquid concrete form prior to loading into a ready-mix truck for delivery. We also offer portable dry and central-mix concrete plants that ship pre-wired and pre-plumbed. These plants are self-erecting, low-profile and easily transportable, providing our customers with true mobility with rapid setup and deployment.
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Unlike previous technologies, our multi-nozzle device eliminates the need for costly additives by creating microscopic bubbles through the mixing of water and asphalt cement. Our burner products find applications across various industries, emphasizing customization for specific applications. From chemical plants to oil-and-gas refineries, offshore platforms, power generation plants and more, our burner products are known for their versatility and adaptability.
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Additionally, our specialty plants are engineered for bagging, paste-back fill and block production. Heating and Combustion - Our burner products are recognized for their versatility and adaptability, serving chemical plants, oil-and-gas refineries, offshore platforms, power generation facilities and many other industrial settings.
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Certain of our asphalt burner platforms are developed for retrofit applications and offer compatibility with most drum designs. Our investment in combustion technology aims to help customers achieve carbon footprint reduction goals. We offer burners that can use alternative fuels such as renewable natural gas, hydrogen blended natural gas and biomass as opposed to traditional liquid fuels.
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This broad applicability ensures that our solutions can be tailored to the unique needs of each customer and project. Some of our asphalt burner platforms are specifically developed for retrofit applications, offering compatibility with most drum designs.
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We offer many products with advanced control technology, including low-emission burners and emissions-control devices like dust collectors, charcoal fume scrubbers and blue smoke systems. Our horizontal wood grinders, disc and drum chippers, as well as blower trucks and trailers have been diverting green waste from landfills for over 40 years.
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Our portfolio includes burners capable of utilizing alternative fuels such as renewable natural gas, hydrogen-blended natural gas and biomass, providing environmentally responsible options beyond traditional liquid fuels. This focus on sustainability aligns with evolving industry standards and regulatory requirements. By combining advanced technology with flexible fuel options, we deliver solutions that help customers achieve both operational excellence and environmental compliance.
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Drum chippers create biomass wood chips from un-merchantable wood for energy production, erosion control, playground chips or landscaping. Blower trucks are used for erosion control, landscaping, green roofs and the application of playground chips. Our pavers are designed for minimal maintenance costs while exceeding road surface smoothness requirements.
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By converting low-value material into sellable product, these grinders provide environmental and economic benefits to our customers. Drum chippers are designed to produce biomass wood chips from unmerchantable wood, which can be used for energy production, erosion control, playground surfacing or landscaping applications.
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Our product lines extend beyond asphalt production, encompassing full milling machines, soil stabilizers, patented screeds and concrete production equipment. Our concrete plants, known for quick setup, tear-down and reliability, cater to both portable and stationary needs, providing custom-engineered design flexibility. Focus on Sustainability We recognize the significance of RAP in new paving applications.
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Our blower trucks further support the aforementioned applications offering versatile solutions for a variety of environmental and construction needs. Astec Digital - Astec Digital leverages our market leadership and installed equipment base to expand our presence in controls and automation. Our Signal platform aggregates operational data from this connected asset base, delivering insights that improve efficiency, uptime and profitability.
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During the first quarter of 2022, we executed an agreement with the noncontrolling interest holder to acquire their outstanding interest in full. Completion of the transaction is subject to resolution of certain disputes between the parties.
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This foundation of connected equipment positions us to develop advanced digital capabilities including digital twins and future innovations in robotics, machine learning and artificial intelligence. Our plant automation systems deliver precise control over the entire production process. Intuitive graphic interfaces allow operators to monitor and adjust operations in real time, reducing training requirements and errors.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeITEM 1A. RISK FACTORS The following risks are considered material to our business, operating results and financial condition based upon current knowledge, information and assumptions. This discussion of risk factors should be considered closely in conjunction with Part II, Item 7.
Biggest changeITEM 1A. RISK FACTORS The following risks are considered material to our business, operating results and financial condition based upon current knowledge, information and assumptions. This discussion of risk factors should be considered closely in conjunction with Part II, 10 Table of Contents
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Management's Discussion and Analysis of Financial Condition and Results of Operations and the Consolidated Financial Statements and the accompanying notes thereto included in Part II, Item 8 of this Annual Report on Form 10-K. The risks and uncertainties described below are not the only ones we face.
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Additional risks and uncertainties not presently known to us, or that we presently deem less significant, may also impair our business, operating results and financial condition. If any of the following risks actually occur, our business, operating results and financial condition could be materially adversely affected.
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The order of these risk factors does not reflect their relative importance or likelihood of occurrence. Some of these risks and uncertainties could affect particular lines of business, while others could affect all of our businesses.
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We, except as required by law, undertake no obligation to update or revise this risk factors discussion, whether as a result of new developments or otherwise. 10 Table of Content s Economic and Industry Risks Downturns in the general economy or decreases in government infrastructure spending or commercial and residential construction spending may adversely affect our revenues and operating results.
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General economic downturns, including downturns in government infrastructure spending and the commercial and residential construction industries, could result in a material decrease in our revenues and operating results. Sales of our products are sensitive to the specific locations and regional economies in which they are sold in general, and in particular, changes in commercial construction spending and government infrastructure spending.
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In addition, many of our costs are fixed and cannot be quickly reduced in response to decreased demand.
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Several factors, including the following, could cause a downturn in the commercial and residential construction industries in which we operate: • a decrease in the availability of funds for construction; • declining economy domestically and internationally; • labor disputes in the construction industry causing work stoppages; • rising gas and oil prices; • rising steel prices and steel surcharges, including as a result of tariffs or other trade policies; • rising interest rates; • energy or building materials shortages; • natural disasters and inclement weather; • changes in regulations; • availability of credit for customers; • geopolitical conflicts; and • general economic and political uncertainty.
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A decrease or delay in government funding of highway construction and maintenance may cause our revenues and profits to decrease. Many of our customers depend on government funding of highway construction and maintenance and other infrastructure projects.
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Historically, much of the U.S. highway infrastructure market has been driven by government spending programs, and federal government funding of infrastructure projects has typically been accomplished through bills that establish funding over a multi-year period. For example, the U.S. government funds highway and road improvements through the Federal Highway Trust Fund Program.
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This program provides funding to improve the nation's roadway system. In November 2021, the U.S. government enacted the Infrastructure Investment and Jobs Act ("IIJA"). The IIJA allocates $548 billion in government spending to new infrastructure over the five-year period concluding in 2026, with certain amounts specifically allocated to fund highway and bridge projects.
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Governmental funding that is committed or earmarked for federal highway projects is always subject to political decision making that may result in repeal or reduction.
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Congress could pass legislation in future sessions that would allow for the diversion of previously appropriated highway funds for other national purposes, or it could restrict funding of infrastructure projects unless states comply with certain federal policies.
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Furthermore, the 2024 U.S. presidential and congressional election results could alter legislative priorities and have a material impact on government funding of infrastructure projects. The cyclical nature of our industry and the product mix of the equipment we sell may cause adverse fluctuations to our revenues and operating results.
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We sell equipment primarily to contractors whose demand for equipment depends greatly upon the volume of road or utility construction projects underway or to be scheduled by both government and private entities. The volume and frequency of road and utility construction projects are cyclical; therefore, demand for many of our products is cyclical.
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The equipment we sell is durable and typically lasts for several years, which also contributes to the cyclical nature of the demand for our products. As a result, we may experience cyclical fluctuations to our revenues and operating results. Any difficulty in managing our manufacturing workflow during downturns in demand could adversely affect our financial results.
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Changes in interest rates and the lack of credit and third-party financing arrangements for our customers could reduce demand for our products.
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Continued periods of higher interest rates, compared to historic low levels, could have a dampening effect on overall economic activity and/or the financial condition of our customers, either or both of which could negatively affect customer demand for our products, make it more difficult for customers to cost-effectively secure financing to fund the purchase of new equipment or our customers' ability to repay obligations to us.
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Our customers’ inability to secure financing for projects on attractive terms could result in the delay, cancellation or downsizing of new purchases which could adversely affect our sales. 11 Table of Content s Market Condition Risks Competition could reduce revenue from our products and services and cause us to lose market share, and our ability to compete in international jurisdictions is dependent upon trade policies, which are subject to change.
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We currently face strong competition in product performance, price and service. Some of our domestic and international competitors have greater financial, product development and marketing resources than we have.
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If competition in our industry intensifies or if our current competitors enhance their products or lower their prices for competing products, we may lose sales or be required to lower the prices we charge for our products. This may reduce revenue from our products and services, lower our gross margins or cause us to lose market share.
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In addition to the general competitive challenges we face, international trade policies could negatively affect the demand for our products and services and reduce our competitive position in such markets. The 2024 U.S. presidential and congressional election results may have a significant impact on U.S. domestic and global trade policies.
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The implementation of more restrictive trade policies, such as higher tariffs, duties or charges, in countries where we operate could negatively impact our business, results of operations and financial condition. In addition, unfavorable currency fluctuations could result in our products and services being more expensive than local competitors.
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Our operations in foreign countries, and continued expansion into additional international markets, could expose us to risks inherent in doing business outside of the United States. In 2024, international sales represented approximately 22.2% of our total sales as compared to 19.0% in 2023. We plan to continue increasing our already significant sales and production efforts in international markets.
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Both the sales from international operations and export sales are subject in varying degrees to risks inherent in doing business outside of the United States.
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Such risks include the possibility of unfavorable circumstances arising from host country laws or regulations and general economic and political conditions in the countries we do business, which are typically more volatile than the U.S. and more vulnerable to geopolitical conditions. In addition, the U.S.
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Government has established and, from time to time, revises sanctions that restrict or prohibit U.S. companies and their subsidiaries from doing business with certain foreign countries, entities and individuals. Doing business internationally also subjects us to numerous U.S. and foreign laws and regulations, including regulations relating to anti-bribery, privacy regulations and anti-boycott provisions.
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We incur meaningful costs complying with these laws and regulations. The continued expansion of our international operations could increase the risk of violations of these laws in the future.
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Significant violations of these laws, or allegations of such violations, could harm our reputation, disrupt our business and result in significant fines and penalties that could have a material adverse effect on our results of operations or financial condition.
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Our ability to understand our customers' specific preferences and requirements, and to develop, manufacture and market products that meet customer demand as we expand into additional international markets, could significantly affect our business results.
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Our ability to match new product offerings to diverse global customers' anticipated preferences for different types and sizes of equipment and various equipment features and functionality, at affordable prices, is critical to our success. This requires a thorough understanding of our existing and potential customers on a global basis, particularly in Europe, Asia, Africa, the Middle East and Latin America.
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Failure to deliver quality products that meet customer needs at competitive prices ahead of competitors could have a significant adverse effect on our business. Our international sales and associated operating results are subject to currency exchange risk. We are exposed to risk as a result of fluctuations in foreign currency exchange rates from transactions involving foreign operations and currencies.
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We derive significant revenue, earnings and cash flow from operations outside of the U.S., where business operations are transacted in local currencies.
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Our exposure to currency exchange rate fluctuations results primarily from the translation exposure associated with the preparation of our consolidated financial statements, as well as from transaction exposure associated with transactions and assets and liabilities denominated in currencies other than the respective subsidiaries' functional currencies.
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While our consolidated financial statements are reported in U.S. dollars, the financial statements of our international subsidiaries are prepared using their respective functional currency and translated into U.S. dollars by applying appropriate exchange rates.
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As a result, fluctuations in the exchange rate of the U.S. dollar relative to the local currencies could cause significant fluctuations in the value of our assets and liabilities, equity and operating results. Additionally, our international sales involve some level of export from the U.S., either of components or completed products.
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Policies and geopolitical events affecting exchange rates could adversely affect the demand for construction equipment in many areas of the world. Further, any strengthening of the U.S. dollar or any other currency of a country in which we manufacture our products and/or any weakening of local currencies can increase the cost of our products in foreign markets.
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Irrespective of any effect on the overall demand for construction equipment, the effect of these changes can make our products less competitive relative to local producing competitors or other non-U.S. competitors and, in extreme cases, can result in our products not being cost-effective for customers.
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As a result, our international sales and profit margins could decline. 12 Table of Content s Manufacturing and Operations Risks Our profitability may be negatively affected by changes in the availability and price of certain parts, components and raw materials. We require access to various parts, components and raw materials at competitive prices in order to manufacture our products.
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Changes in the availability and price of these parts, components and raw materials (including steel) have changed significantly and rapidly at times.
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The availability and price of such items are affected by factors like demand, changes to international trade policies that may result in additional tariffs, duties or other charges, freight costs, global pandemics, shipping and container constraints and labor shortages and costs, each of which can significantly increase the costs of production.
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Increased production costs could become particularly significant if the U.S. or foreign governments impose additional tariffs, including on steel. The Trump administration recently imposed a 25% tariff on all steel and aluminum imports, which may result in meaningfully higher steel costs and, as a result, increased production costs that we may not be able to pass onto our customers.
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Due to price competition in the market for construction equipment and certain infrastructure products which have longer contract to completion cycles, we may not be able to recoup increases in these costs through price increases for our products, which would result in reduced profitability.
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Whether increased operating costs can be passed through to the customer depends on a number of factors, including the price of competing products, the nature of our customers' orders and overall demand for our products. Further, we rely on a limited number of suppliers for steel and certain other raw materials, parts and components in the manufacturing process.
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Disruptions or delays in supply or significant price increases from these suppliers could adversely affect our operations and profitability, including our ability to convert our backlog and net sales. Such disruptions, terminations or cost increases could result in cost inefficiencies, delayed sales or reduced sales.
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We may be adversely affected by any natural or man-made disruptions to our distribution and manufacturing facilities, as well as disruptions and equipment-related issues. We currently maintain a broad network of distribution and manufacturing facilities throughout the U.S. as well as internationally.
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Any widespread disruption to our facilities resulting from fire, earthquake, weather-related events (such as tornadoes, hurricanes, flooding and other storms), an act of terrorism, geopolitical conflicts or any other cause could damage a significant portion of our inventory and could materially impair our ability to distribute our products to customers.
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Additionally, the equipment and management systems necessary for our manufacturing operations may break down, perform poorly or fail, resulting in fluctuations in manufacturing efficiencies. Moreover, we could incur significantly higher costs and longer lead times associated with distributing our products to our customers during the time that it takes for us to reopen or replace a damaged facility.
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Although we carry property and business interruption insurance, our coverage may not be adequate to compensate us for all losses that may occur. Any of these events individually or in the aggregate could have a material adverse effect on our business, financial condition and operating results.
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In addition, general weather patterns affect our operating results throughout the year, with adverse weather historically reducing construction activity in the first and fourth quarters in the U.S., our largest market. An increase of adverse weather events, including as a result of climate change, could generally reduce or delay construction activity, which could adversely impact our revenues.
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Strategic Performance Risks We may not fully sustain targeted performance improvements and other benefits realized from our OneASTEC business model. The OneASTEC business model was designed to better set strategic direction, define priorities and improve overall operating performance.
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Coupled with our strategic pillars that are aligned to focus on our employees, our customers and our innovation, the OneASTEC business model is centered around continuous improvement. Our future success is partly dependent upon successfully executing and realizing performance improvements, revenue gains, cost savings and other benefits from our initiatives.
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It is possible that we may not fully realize, or sustain, the expected benefits from the OneASTEC business model. Furthermore, the implementation of the OneASTEC initiatives will result in an increase in near-term expenses and may negatively impact operational effectiveness and employee morale.
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As an innovative leader in the industries in which we operate, we occasionally undertake the engineering, design, manufacturing, construction and installation of equipment systems and technologies that are new to the market, which could result in our realization of significantly reduced or negative margins and/or a responsibility to reimburse the customer for financial losses, including, but not limited to, the possible refund of the purchase price.
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Designing and developing innovative equipment and technologies to function as expected is inherently difficult and significant design phase, field testing and redesign costs are often incurred in connection with such design and development activities.
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The design and development phase requires meaningful lead time before a product is ready for market, which often requires a significant investment in potentially new technologies and manufacturing techniques to evolve our existing products and introduce new products prior to realizing any revenues associated with such improved or new products.
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This also requires us to 13 Table of Content s anticipate changing customer demands. Our success depends on our ability to invest in new technologies and manufacturing techniques to continue to meet those changing demands. If we are unable to accurately anticipate such customer demands, we will likely incur losses associated with such product development.
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Furthermore, many of our competitors are larger than us and have more financial resources to invest in new technologies and manufacturing techniques. If we are unable to keep pace with these competitors in terms of new technology and innovation we may lose market share and our results of operations may be adversely affected.
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In addition, any number of unforeseen circumstances can impact actual project costs. Production delays, design changes, adverse weather conditions and other factors can also result in construction and testing delays, which can cause significant cost overruns or failure to meet required completion dates.
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In certain circumstances, we may incur contractual penalties as a result of such delays to bring a product to market or be unable to satisfy minimum production levels, and we may be liable to customers for other losses they incur in connection with such delays, including possible refund of the purchase price.
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At various times, we have experienced negative margins on certain large projects. These large projects have included both existing and innovative equipment designs, on-site construction and promised minimum production levels. We may not be able to sufficiently predict the extent of such unforeseen cost overruns and may experience significant losses on specialized projects in the future.
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Failure to successfully complete restructuring activities could negatively affect our operations. From time to time, we may divest of or wind down certain business activities, product lines and/or perform other organizational restructuring projects in an effort to reduce costs and streamline operations.
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Such activities involve risks as they may divert management's attention from our core businesses, increase expenses on a short‑term basis and lead to potential issues with employees, customers or suppliers.
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If these activities are not completed in a timely manner, anticipated cost savings, synergies and efficiencies are not realized, business disruption occurs during the pendency of or following such activities or unanticipated charges are incurred, particularly if material, there may be a negative effect on our business, results of operations and financial condition.
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As part of our growth strategy, we may pursue acquisitions in the future and may not be successful in completing such acquisitions on favorable terms or be able to realize the anticipated benefits from such acquisitions. As part of our growth strategy, we may pursue attractive acquisition opportunities if and when they become available.
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Failure to identify and acquire suitable acquisition candidates on appropriate terms could adversely impact our growth strategy. In addition, we may not be able to fully integrate the operations of any future acquired businesses with our own operations in an efficient and cost-effective manner or without significant disruption to our or the acquired companies’ existing operations.
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Moreover, acquisitions involve significant risks and uncertainties, including uncertainties as to the future financial performance of the acquired business, the achievement of expected synergies, difficulties integrating acquired personnel and corporate cultures into our business, the potential loss of key employees, customers or suppliers, difficulties in integrating different computer and accounting systems, exposure to unforeseen liabilities of acquired companies and the diversion of management attention and resources from existing operations.
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We may be unable to successfully complete potential acquisitions due to multiple factors, such as issues related to regulatory review of the proposed transactions or obtaining favorable financing or losing out on attractive acquisition opportunities to competing bidders that may have greater financial resources than us.
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We may also be required to incur additional debt or issue additional shares of our common stock in order to consummate acquisitions in the future. Potential new indebtedness may be substantial and may limit our flexibility in using our cash flow from operations.
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The issuance of new shares of our common stock could dilute the equity value of our existing shareholders. Our failure to fully integrate future acquired businesses effectively or to manage other consequences of our acquisitions, including increased indebtedness, could prevent us from remaining competitive and, ultimately, could adversely affect our financial condition, operating results and cash flows.
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Financial Risks We may be unsuccessful in complying with the financial ratio covenants or other provisions of our credit agreement. As of December 31, 2024, we were in compliance with the financial covenants contained in our credit agreement.
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However, in the future we may be unable to comply with the financial covenants in our credit facility or to obtain waivers with respect to such financial covenants.
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If such violations occur, our creditors could elect to pursue their contractual remedies under the credit facility, including requiring immediate repayment in full of all amounts then outstanding and requiring cash collateral to support outstanding letters of credit.
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As of December 31, 2024, we had outstanding borrowings of $105.0 million and an additional $5.2 million in letters of credit outstanding under the credit agreement. We may also borrow additional amounts under the credit agreement in the future.
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Certain of our international subsidiaries in Australia, Brazil, Canada, South Africa and the United Kingdom have entered into their own independent loan agreements with the same lenders to our credit agreement as well as with other lending institutions. 14 Table of Content s We are subject to income taxes in the United States and certain foreign jurisdictions, and changes to the tax codes, effective tax rates and accounting principles related thereto could negatively impact our results of operations.
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We are subject to income taxes in the United States and other jurisdictions.
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Our results of operations could be adversely affected by, among other things, changes in the effective tax rates in the U.S. and foreign jurisdictions, a change in the mix of earnings between U.S. and non-U.S. jurisdictions or among jurisdictions with differing tax rates, changes in tax laws or treaties and related changes in generally accepted accounting principles.
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Additionally, we typically incur substantial research and development costs each year and have historically received significant research and development tax credits due to these expenditures. Congress could reduce or eliminate such tax credits in future years, which could have a material adverse effect on our operating results.
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We may not be able to adequately manage the risks associated with our products and systems, including increased warranty costs.
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The success of our products depends on our ability to manage the risks that our products may have quality or other defects or deficiencies that result in their failure to satisfy performance or reliability requirements, including costs associated with design, manufacturing and warranties.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThis includes regular reporting and evaluation of all cybersecurity incidents, not only those that may be deemed material.
Biggest changeAs part of our defined cybersecurity policies and cybersecurity incident response plan, management is regularly updated on the status of the execution of our cybersecurity strategy and daily operations of the program. This includes regular reporting and evaluation of all cybersecurity incidents, not only those that may be deemed material.
Risk Factors hereof. Governance Our Board of Directors has primary responsibility for evaluating cybersecurity risk management, overseeing our major cybersecurity risk exposures and the steps management has taken to monitor and control these exposures, including policies and procedures for assessing and managing risk, as well as oversight of compliance related to legal and regulatory exposure.
Risk Factors hereof. Governance Our Audit Committee has primary responsibility for evaluating cybersecurity risk management, overseeing our major cybersecurity risk exposures and the steps management has taken to monitor and control these exposures, including policies and procedures for assessing and managing risk, as well as oversight of compliance related to legal and regulatory exposure.
The management positions responsible for assessing and managing cybersecurity risks include our Director of Cybersecurity and our Chief Information Officer ("CIO"), who reports directly to our Chief Executive Officer ("CEO"). Our CIO is responsible for ensuring that we have a cybersecurity risk management program in place that is fully aligned with business requirements and strategy.
The management positions responsible for assessing and managing cybersecurity risks include our Senior Director of IT Infrastructure and our Chief Information Officer ("CIO"), who reports directly to our Chief Financial Officer ("CFO"). Our CIO is responsible for ensuring that we have a cybersecurity risk management program in place that is fully aligned with business requirements and strategy.
In the event of a material cybersecurity incident, communication to the Board is provided pursuant to our cybersecurity incident response plan.
In the event of a material cybersecurity incident, communication to the Audit Committee is provided pursuant to our cybersecurity incident response plan.
We utilize internal information technology resources for the primary aspects of our cybersecurity program. Our internal team is supported by external service providers and consultants as needed. We utilize third-party service providers to manage portions of our business operations. We have established processes to review, identify and manage cybersecurity risks associated with the use of service providers.
Our internal team is supported by external service providers and consultants as needed. We utilize third-party service providers to manage portions of our business operations. We have established processes to review, identify and manage cybersecurity risks associated with the use of service providers.
CYBERSECURITY Risk Management and Strategy We have developed and implemented a comprehensive cybersecurity strategy and risk management program that is informed by the following key elements: • Periodic cybersecurity program maturity assessments to evaluate the overall controls, processes, skills and platforms leveraged to assess, identify and manage material risks from cybersecurity threats. • Periodic business impact assessments of key business processes and services that enable us to identify sensitive and critical aspects of the business, the impact of operational disruptions to those processes and services and the sensitivity of the data leveraged in those processes and services. • An external assessment of the cybersecurity risks associated with our operations. • Periodic penetration testing of our internal and external IT environment to validate the real-world efficacy of our cybersecurity program and mitigate the risks of new cybersecurity vulnerabilities.
CYBERSECURITY Risk Management and Strategy We have developed and implemented a comprehensive cybersecurity strategy and risk management program that is informed by the following key elements: • Periodic cybersecurity program maturity assessments to evaluate the overall controls, processes, skills and platforms leveraged to assess, identify and manage material risks from cybersecurity threats. • Periodic business impact assessments of key business processes and services that enable us to identify sensitive and critical aspects of the business, the impact of operational disruptions to those processes and services and the sensitivity of the data leveraged in those processes and services. • Periodic penetration testing of our internal and external IT environment to validate the real-world efficacy of our cybersecurity program and mitigate the risks of new cybersecurity vulnerabilities. 20 Table of Contents The primary aspects of our cybersecurity program are managed by internal information technology resources.
Our CIO, supported by our Director of Cybersecurity, provides quarterly reports to the Board, which, generally includes: • Our cybersecurity risk profile; • Any changes to our cybersecurity strategy; • Status of the execution of the cybersecurity strategy; and • Summary of any material cybersecurity incidents that have occurred over the past quarter, including the nature, impact and resolution of incidents.
Our CIO, supported by our Senior Director of IT Infrastructure, provides reports to the Audit Committee, which, generally include: • Our cybersecurity risk profile; • Any changes to our cybersecurity strategy; • Status of the execution of the cybersecurity strategy; and • Summary of any material cybersecurity incidents that have occurred over the past quarter, including the nature, impact and resolution of incidents.
Our CIO and Director of Cybersecurity both have over 20 years of cybersecurity oversight experience. Our CIO previously served as CIO for a New York Stock Exchange listed manufacturing company prior to joining the Company.
Our CIO and our Senior Director of IT Infrastructure have over 10 and 20 years of cybersecurity oversight experience, respectively. Our CIO previously served as CIO for a New York Stock Exchange listed building materials company prior to joining the Company.
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Additionally, our Director of Cybersecurity has experience developing and implementing cybersecurity programs for multiple manufacturing firms. 19 Table of Content s As part of our defined cybersecurity policies and cybersecurity incident response plan, management is regularly updated on the status of the execution of our cybersecurity strategy and daily operations of the program.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe following table lists the principal locations (defined as greater than 20,000 square feet) that are owned or leased by us, as denoted, and which are utilized in our continuing business operations: Location Segment Facility Type/Use Approximate Square Feet United States Chattanooga, Tennessee (1) Infrastructure Solutions Manufacturing/rebuild, offices, training center, warehouse and storage 1,352,384 Yankton, South Dakota Materials Solutions Manufacturing, warehouse and offices 344,995 Eugene, Oregon Materials Solutions Manufacturing and offices 140,300 Eugene, Oregon Infrastructure Solutions Manufacturing and offices 135,920 Blair, Nebraska Infrastructure Solutions Manufacturing and offices 114,831 Burlington, Wisconsin Infrastructure Solutions Manufacturing and offices 112,100 Prairie du Chien, Wisconsin Infrastructure Solutions Manufacturing 100,336 Parsons, Kansas Infrastructure Solutions Manufacturing and offices 91,600 Sterling, Illinois (1) Materials Solutions Manufacturing and offices 67,500 Rossville, Georgia Infrastructure Solutions Manufacturing 40,500 Chattanooga, Tennessee (1) Corporate and Other Offices and hangar 37,006 West Columbia, South Carolina (1) Infrastructure Solutions Distribution center 20,400 International Johannesburg, Gauteng, South Africa Materials Solutions Manufacturing and offices 229,000 Omagh, County Tyrone, United Kingdom Materials Solutions Manufacturing and offices 205,000 Vespasiano, Minas Gerais, Brazil Materials Solutions Manufacturing and offices 132,400 Thornbury, Ontario, Canada Materials Solutions Manufacturing and offices 60,500 Acacia Ridge, Queensland, Australia Infrastructure Solutions Offices, service, light fabrication, warehouse and storage 36,000 Marieville, Quebec, Canada (1) Infrastructure Solutions Manufacturing, warehouse, offices and storage 27,495 St-Bruno, Quebec, Canada (1) Infrastructure Solutions Warehouse and offices 21,800 (1) These facilities are partially or fully leased. 20 Table of Content s
Biggest changeThe following table lists the principal locations that are owned or leased by us, as denoted, and which are utilized in our continuing business operations: Location Segment Facility Type/Use Approximate Square Feet United States Chattanooga, Tennessee (1) Infrastructure Solutions Manufacturing/rebuild, offices, training center, warehouse and storage 1,397,388 Yankton, South Dakota Materials Solutions Manufacturing, warehouse and offices 344,995 Eugene, Oregon Materials Solutions Manufacturing and offices 140,300 Portland, Oregon (1) Materials Solutions Manufacturing 138,200 Eugene, Oregon Infrastructure Solutions Manufacturing and offices 135,920 Blair, Nebraska (1) Infrastructure Solutions Manufacturing and offices 123,100 Burlington, Wisconsin Infrastructure Solutions Manufacturing and offices 112,100 Stafford, Texas (1) Materials Solutions Manufacturing 110,800 Prairie du Chien, Wisconsin Infrastructure Solutions Manufacturing 100,336 Belleville, Illinois Materials Solutions Manufacturing and offices 95,000 Parsons, Kansas Infrastructure Solutions Manufacturing and offices 91,600 Princeton, West Virginia Materials Solutions Manufacturing 84,041 Sterling, Illinois (1) Materials Solutions Manufacturing and offices 67,500 Duncan, South Carolina (1) Materials Solutions Manufacturing and offices 60,000 Raleigh, Illinois Materials Solutions Manufacturing 52,000 International Johannesburg, Gauteng, South Africa Materials Solutions Manufacturing and offices 229,000 Omagh, County Tyrone, United Kingdom Materials Solutions Manufacturing and offices 205,000 Vespasiano, Minas Gerais, Brazil Materials Solutions Manufacturing and offices 132,400 Thornbury, Ontario, Canada Materials Solutions Manufacturing and offices 60,500 (1) These facilities are partially or fully leased.
As we continue to optimize our global footprint, we may identify properties or expansion opportunities at existing locations that provide growth opportunity or determine that certain of our current properties no longer meet our requirements. Such new properties may be leased or purchased, and current properties may be modified, sold, leased or utilized in another manner.
As we continue to optimize our global footprint, we may identify properties or expansion 21 Table of Contents opportunities at existing locations that provide growth opportunity or determine that certain of our current properties no longer meet our requirements. Such new properties may be leased or purchased, and current properties may be modified, sold, leased or utilized in another manner.
ITEM 2. PROPERTIES As of December 31, 2024, our manufacturing, warehouse and office facilities total approximately 3.3 million square feet of space globally. We believe all properties to be well maintained and adequate for present use, with sufficient capacities for current needs as our business is presently conducted.
ITEM 2. PROPERTIES As of December 31, 2025, our manufacturing, warehouse and office facilities total approximately 4.0 million square feet of space globally. We believe all properties to be well maintained and adequate for present use, with sufficient capacities for current needs as our business is presently conducted.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeMINE SAFETY DISCLOSURES None. 21 Table of Content s PART II
Biggest changeMINE SAFETY DISCLOSURES None. 22 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 changeDecember 31, (in dollars) 2019 2020 2021 2022 2023 2024 Astec Industries, Inc. 100.00 139.28 167.78 99.58 92.30 84.57 Russell 2000 100.00 119.93 137.66 109.49 127.97 142.73 S&P 600 SmallCap Industrials 100.00 111.94 140.80 127.39 167.57 196.11 ITEM 6. [RESERVED]
Biggest changeDecember 31, (in dollars) 2020 2021 2022 2023 2024 2025 Astec Industries, Inc. 100.00 120.46 71.49 66.27 60.72 79.28 Russell 2000 100.00 114.82 91.35 106.82 119.14 134.41 S&P 600 SmallCap Industrials 100.00 125.90 114.07 150.38 176.19 200.50 ITEM 6. [RESERVED] ITEM 7.
The graph assumes that the value of an investment in our common stock, in the Russell 2000 index and in the S&P 600 SmallCap Industrials index was $100 on December 31, 2019 and assumes reinvestment of all dividends as well as the relative performance of each through December 31, 2024.
The graph assumes that the value of an investment in our common stock, in the Russell 2000 index and in the S&P 600 SmallCap Industrials index was $100 on December 31, 2020 and assumes reinvestment of all dividends as well as the relative performance of each through December 31, 2025.
Dividend Policy We paid quarterly dividends of $0.13 per common share to shareholders in all four quarters of both 2024 and 2023, totaling cash paid of $11.9 million and $11.8 million for dividends in 2024 and 2023, respectively. Dividends are paid when, as and if declared at the discretion of our Board from funds legally available for that purpose.
Dividend Policy We paid quarterly dividends of $0.13 per common share to shareholders in all four quarters of both 2025 and 2024, totaling cash paid of $11.9 million for dividends in both years. Dividends are paid when, as and if declared at the discretion of our Board from funds legally available for that purpose.
In addition, our payment of dividends may be limited by restrictive covenants in our revolving credit facility agreement. 22 Table of Content s Performance Graph The stock performance graph below is intended to show our stock performance compared with that of comparable companies.
In addition, our payment of dividends may be limited by restrictive covenants in our revolving credit facility agreement. 23 Table of Contents Performance Graph The stock performance graph below is intended to show our stock performance compared with that of comparable companies.
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Common Stock Our common stock is traded on the Nasdaq National Market under the ticker symbol "ASTE". As of February 21, 2025, there were 232 holders of record of our common stock.
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Common Stock Our common stock is traded on the Nasdaq National Market under the ticker symbol "ASTE". As of February 20, 2026, there were 223 holders of record of our common stock.
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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the consolidated financial statements and the related notes included in Item 8 of this Annual Report on Form 10-K for the year ended December 31, 2025.
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The results of operations and other information included herein are not necessarily indicative of the financial condition, results of operations and cash flows that may be expected in future periods. This Annual Report on Form 10-K, including matters discussed in this Item 7.
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Management's Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements relating to our plans, estimates and beliefs that involve important risks and uncertainties. See "Safe Harbor Statements Under the Private Securities Litigation Reform Act" and Part I, Item 1A.
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Risk Factors 24 Table of Contents for a discussion of uncertainties and assumptions that may cause actual results to differ materially from those expressed or implied in the forward-looking statements. This section of this Annual Report on Form 10-K generally discusses 2025 and 2024 items and year-to-year comparisons between 2025 and 2024.
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A similar discussion of 2023 items and year-to-year comparisons between 2024 and 2023 can be found in Part II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations of our Annual Report on Form 10-K for the year ended December 31, 2024 .
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The financial condition and results of operations discussed in this Management's Discussion and Analysis of Financial Condition and Results of Operations are those of Astec Industries, Inc. and its consolidated subsidiaries, collectively, the "Company," "Astec," "we," "our" or "us." Business Overview We design, engineer, manufacture, market and service equipment and components used primarily in asphalt and concrete road building and related construction activities, as well as certain other products.
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Our products are used in each phase of road building, from quarrying and crushing the aggregate to application of the road surface.
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We also offer industrial automation controls and telematics platforms as well as manufacture certain equipment and components unrelated to road construction, including equipment for the mining, quarrying, construction, demolition, land clearing and recycling industries and port and rail yard operators; industrial heat transfer equipment; commercial whole-tree pulpwood chippers; horizontal grinders; blower trucks; commercial and industrial burners; and combustion control systems.
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Our products are marketed both domestically and internationally primarily to asphalt and concrete producers; highway and heavy equipment contractors; utility contractors; sand and gravel producers; construction, demolition, recycling and crushing contractors; forestry and environmental recycling contractors; mine and quarry operators; port and inland terminal authorities; power stations and domestic and foreign government agencies.
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In addition to equipment sales, we manufacture and sell replacement parts for equipment in each of our product lines and replacement parts for some competitors' equipment. The distribution and sale of replacement parts is an integral part of our business.
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Executive Summary Highlights of our financial results as of and for the year ended December 31, 2025 as compared to the prior year include the following: • Net sales were $1,410.4 million, an increase of 8.1% • Gross profit was $374.2 million, an increase of 14.1% • Income from operations was $65.9 million, an increase of 184.1% • Net income attributable to Astec was $38.8 million, an increase of 802.3% • Diluted income per share was $1.68, an increase of 784.2% • Backlog was $514.1 million, an increase of 22.5% Significant Items Impacting Financial Results in 2025 TerraSource Acquisition On July 1, 2025, we completed our acquisition of TerraSource Holdings, LLC ("TerraSource"), a market-leading manufacturer of material processing equipment and related aftermarket parts serving complementary crushing, screening and separation applications.
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This acquisition provides us with access to adjacent markets in materials processing equipment and related aftermarket parts and significant growth and value creation opportunities.
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New Credit Facility On July 1, 2025 and simultaneously with the consummation of the acquisition of TerraSource, we entered into a new credit agreement (the "2025 Credit Agreement") with Wells Fargo Bank, National Association, as administrative agent, and the lenders party thereto from time to time that provides for (i) a revolving credit facility, a term loan facility, a swingline facility and a letter of credit facility, in an initial aggregate amount of up to $600.0 million and (ii) an incremental facilities limit in an aggregate amount not to exceed $150.0 million (collectively, the "2025 Credit Facilities").
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Strategic Transformation Program Our strategic transformation program includes the ongoing multi-year phased implementation of a standardized enterprise resource planning ("ERP") system, which is replacing much of our existing disparate core financial systems. To date, we have launched the human capital resources module in our U.S. and Canadian locations and converted the operations of three manufacturing sites along with Corporate.
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We expect the project to conclude in 2028 or 2029 with total approximate 25 Table of Contents implementation costs anticipated to range from $180 to $200 million. Through the year ended December 31, 2025, we have incurred total implementation costs of approximately $151 million.
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See Note 21, Strategic Transformation and Restructuring, Impairment and Other Asset (Gains) Charges, net of the Notes to the Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K for additional discussion of the costs related to these strategic initiatives.
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Industry and Business Condition Our financial performance is affected by a number of factors, including the cyclical nature and varying conditions of the markets we serve.
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Demand in these markets fluctuates in response to overall economic conditions and is particularly sensitive to the amount of public sector spending on infrastructure development, privately funded infrastructure development and changes in the prices of liquid asphalt, oil, natural gas and steel.
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In addition, many of our markets are highly competitive, and our products compete worldwide with similar products produced and sold by a number of other manufacturers and dealers. Federal funding provides a significant portion of all highway, street, roadway and parking construction in the United States.
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As federal highway funding programs have consistently been in place for several decades, we believe that these funding programs provide stability in the purchasing decisions of our customers by allowing them to plan and execute longer-term projects with federal legislation in place over a multi-year period.
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The U.S. government enacted the Infrastructure Investment and Jobs Act ("IIJA") in November 2021 as a replacement for the prior program. The IIJA allocates $548 billion in government spending to new infrastructure over the five-year period concluding in 2026, with certain amounts specifically allocated to fund highway and bridge projects.
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We believe that multi-year highway programs (such as the IIJA) have a positive impact on the domestic road construction industry. Significant portions of our revenues from the Infrastructure Solutions segment relate to the sale of equipment involved in the production, handling, recycling or application of asphalt mix and, to a lesser extent, concrete as surface choices for roads and highways.
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Liquid asphalt is a by-product of oil refining, and changes in the price of oil impact the cost of asphalt, which is in turn likely to alter demand for asphalt and therefore affect demand for certain of our products.
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While increasing oil prices may have a negative financial impact on many of our customers, our equipment can use a significant amount of reclaimed asphalt pavement, thereby partially mitigating the effect of increased oil prices on the final cost of asphalt for the customer.
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We continue to develop products and initiatives to reduce the amount of oil and related products required to produce asphalt. Price volatility continues to make it difficult to predict the costs of oil-based products used in road construction such as liquid asphalt and gasoline.
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Oil prices have routinely fluctuated in recent years, and based on the current macroeconomic environment, we anticipate that oil prices will experience moderate fluctuation throughout 2026. Steel is a major component of our equipment.
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In reaction to import tariffs and market uncertainty, steel prices increased in the first half of 2025, before experiencing a gradual decline in the second half of the year, resulting in a relatively stable average price for the year overall.
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Despite rising prices at the end of 2025, we anticipate minimal price changes in 2026 as domestic mills manage output and maintain pricing advantages over imports. We continue to employ flexible strategies to ensure supply and minimize the impact of price volatility.
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Potential ongoing constraints in the supply of certain steel products may continue pressuring the availability of other components used in our manufacturing process.
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Furthermore, given the volatility of steel prices and the nature of our customers' orders, we may not be able to pass through all increases in steel costs to our customers, which may negatively impact our gross profit and margins.
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New or ongoing geopolitical conflicts may cause a downturn in the construction industries in which we operate, cause an increase in oil prices, damage a significant portion of our inventory or materially impair our ability to distribute our products to customers.
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We monitor, adjust and potentially cease our operations in affected jurisdictions to ensure compliance with any governmental actions made in response to such conflicts. Whenever possible, we attempt to cover increased costs of production by adjusting the prices of our products.
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The markets we serve are competitive in nature, and competition limits our ability to pass through cost increases in many cases. Results of Operations: 2025 vs. 2024 Net Sales Net sales increased $105.3 million, or 8.1%, to $1,410.4 million in 2025 from $1,305.1 million in 2024.
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The increase in net sales was primarily driven by net favorable volume and mix coupled with favorable pricing that generated increases in (i) equipment sales of $44.6 million, (ii) parts and component sales of $44.5 million, (iii) service and equipment installation revenue of $12.8 million and (iv) freight revenue of $4.0 million.
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Included in these net increases is $84.7 million of incremental net sales from the acquired TerraSource business. Sales reported by our foreign subsidiaries in U.S. dollars for 2025 would have been $2.5 million lower had foreign exchange rates been the same as the 2024 rates.
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Domestic sales for 2025 were $1,130.2 million, or 80.1% of net sales, compared to $1,015.4 million, or 77.8% of net sales, for 2024, an increase of $114.8 million, or 11.3%.
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Domestic sales increased primarily due to higher (i) equipment sales of $58.9 26 Table of Contents million, (ii) parts and component sales of $42.1 million, (iii) service and equipment installation revenue of $11.2 million and (iv) freight revenue of $3.4 million. Included in the net increase is $58.4 million of incremental domestic revenue from the acquired TerraSource business.
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International sales for 2025 were $280.2 million, or 19.9% of net sales, compared to $289.7 million, or 22.2% of net sales, for 2024, a decrease of $9.5 million, or 3.3%. International sales decreased primarily due to lower equipment sales of $14.3 million partially offset by higher parts and component sales of $2.4 million.
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Included in the net decrease is $26.3 million of incremental international revenue from the acquired TerraSource business. Gross Profit Consolidated gross profit for 2025 was $374.2 million, or 26.5% of net sales, as compared to $327.9 million, or 25.1% of net sales, in 2024, an increase of $46.3 million, or 14.1%.
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The increase in gross profit was primarily driven by the impact of favorable pricing coupled with net favorable volume and mix of $81.6 million.
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These increases were partially offset by (i) manufacturing inefficiencies of $17.8 million, (ii) amortization of acquisition-related inventory fair value step-up of $7.4 million, (iii) higher warranty program costs of $5.5 million and (iv) net unfavorable inventory adjustments of $4.2 million.
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Selling, General and Administrative Expenses Selling, general and administrative expenses for 2025 were $308.7 million, or 21.9% of net sales, compared to $276.1 million, or 21.2% of net sales, for 2024, an increase of $32.6 million, or 11.8%, primarily due to (i) increased personnel-related costs of $24.5 million, partially driven by $6.0 million of employee incentive compensation costs, (ii) increased intangible asset amortization expense of $9.3 million, (iii) increased acquisition and integration costs of $8.7 million primarily attributable to the acquisition of TerraSource and (iv) the $1.9 million benefit derived from the 37 BP litigation loss contingency release offset by the final settlement amount recorded during 2024.
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These increases were partially offset by lower costs related to our strategic transformation program of $13.2 million and decreased professional service costs of $2.9 million. Goodwill Impairment We performed a qualitative assessment for the annual test of goodwill impairment performed in 2025 and concluded that there was no impairment of goodwill.
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During the prior year, we determined that the carrying value of the Materials Solutions reporting unit exceeded its fair value as of June 30, 2024.
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As a result, we recognized a pretax non-cash goodwill impairment charge of $20.2 million in "Goodwill impairment" in the Consolidated Statements of Operations to fully impair the goodwill allocated to the Materials Solutions reporting unit during the second quarter of 2024. No net goodwill related to Materials Solutions is reflected in the Consolidated Balance Sheet as of December 31, 2024.
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See Note 7, Goodwill of the Notes to the Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K for discussion of the pretax non-cash goodwill impairment charge.
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Restructuring, Impairment and Other Asset (Gains) Charges, net Restructuring, impairment and other asset (gains) charges, net for the years ended December 31, 2025 and 2024 are presented below: Years Ended December 31, (in millions) 2025 2024 Restructuring (gains) charges, net: (Gains) charges associated with exited operations – Enid $ (0.2) $ 8.6 Workforce reductions — 0.9 Total restructuring related (gains) charges, net (0.2) 9.5 Gain on sale of property and equipment, net: Gain on sale of property and equipment, net (0.2) (1.1) Total gain on sale of property and equipment, net (0.2) (1.1) Restructuring, impairment and other asset (gains) charges, net $ (0.4) $ 8.4 See Note 21, Strategic Transformation and Restructuring, Impairment and Other Asset (Gains) Charges, net, of the Notes to the Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K for discussion of the individual restructuring actions taken. 27 Table of Contents Interest Expense Interest expense of $18.5 million was incurred for the year ended December 31, 2025 as compared to $10.7 million for the year ended December 31, 2024, an increase of $7.8 million, primarily related to higher average outstanding borrowings coupled with higher interest rates on the 2025 Credit Facilities as compared to the Company's previous credit facilities (the "2022 Credit Facilities"), which were replaced by the 2025 Credit Facilities.
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Income Tax Provision Income tax expense for the year ended December 31, 2025 was $14.3 million, reflecting a 26.9% effective tax rate, compared to $9.8 million for the year ended December 31, 2024, reflecting a 70.5% effective tax rate.
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Our effective tax rates are affected by recurring items which are generally consistent from period to period, as well as discrete items that may occur but are not consistent from period to period.
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The items having the most significant impact on the effective tax rate for 2025 are the effects of state and foreign items, partially offset by a net benefit of $3.7 million for research and development tax credits.
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The item having the most significant impact on the effective tax rate for 2024 is a net benefit of $3.3 million for research and development tax credits. Future utilization of our NOLs and state tax credit carryforwards is evaluated on a periodic basis, and the valuation allowance is adjusted accordingly.
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There is no guarantee that we will not incur additional valuation allowances to our NOLs. Backlog Backlog represents the dollar value of firm orders for equipment, parts and related installation which are expected to be recognized in net sales in the future.
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Firm orders are signed commitments from customers to complete a purchase for machinery, equipment or parts that is expected to be noncancellable and are included in backlog when we are in receipt of an executed contract and any required deposits or security and the orders have not yet been recognized into net sales.
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Certain orders for which we have received binding letters of intent or contracts will not be included in backlog until all required contractual documents and deposits are received. Backlog is not a measure defined by accounting principles generally accepted in the United States of America ("U.S.
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GAAP"), and our methodology for determining backlog may vary from the methodology used by other companies in determining their backlog amounts. In addition, our backlog should not necessarily be viewed as an accurate indicator of revenue for any particular period, and there is no guarantee that our backlog will be converted to net sales.
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Backlog levels provide management and investors additional details of committed orders that are expected to convert to future net sales. Management uses backlog information for capacity and resource planning as well as to monitor inventory levels in our facilities relative to expected future net sales.
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Years Ended December 31, (in millions, except percentage data) 2025 2024 $ Change % Change Infrastructure Solutions $ 294.2 $ 305.5 $ (11.3) (3.7) % Materials Solutions 219.9 114.1 105.8 92.7 % Domestic Backlog 437.2 337.9 99.3 29.4 % International Backlog 76.9 81.7 (4.8) (5.9) % The backlog of orders as of December 31, 2025 was $514.1 million compared to $419.6 million as of December 31, 2024, an increase of $94.5 million, or 22.5%.
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Backlog includes an incremental $53.2 million from the acquired TerraSource business in the Materials Solutions segment. Our shorter production lead times and parts fill rates have allowed for customers to place orders closer to the desired delivery date.
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Additionally, we have experienced variability in the ordering patterns from our customers as a result of macroeconomic factors. 28 Table of Contents Net Sales by Segment Years Ended December 31, (in millions, except percentage data) 2025 2024 $ Change % Change Infrastructure Solutions $ 857.4 $ 837.4 $ 20.0 2.4 % Materials Solutions 553.0 467.7 85.3 18.2 % Infrastructure Solutions Sales in this segment were $857.4 million for 2025 compared to $837.4 million for 2024, an increase of $20.0 million, or 2.4%.
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The increase was primarily driven by favorable pricing partially offset by net unfavorable volume and mix that generated increases in (i) parts and component sales of $6.7 million, (ii) equipment sales of $6.3 million, (iii) service and equipment installation revenue of $4.7 million and (iv) freight revenue of $3.2 million.
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Domestic sales for the Infrastructure Solutions segment increased $17.4 million, or 2.2%, for 2025 compared to 2024 primarily due to higher (i) parts and component sales of $10.7 million, (ii) service and equipment installation revenue of $4.8 million and (iii) freight revenue of $3.0 million.
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International sales for the Infrastructure Solutions segment increased $2.6 million, or 4.8%, for 2025 compared to 2024 primarily due to increased equipment sales of $6.5 million partially offset by decreased parts and component sales of $4.0 million.
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Materials Solutions Sales in this segment were $553.0 million for 2025 compared to $467.7 million for 2024, an increase of $85.3 million, or 18.2%.
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The increase was primarily driven by net favorable volume and mix coupled with favorable pricing that generated increases in (i) equipment sales of $38.3 million, (ii) parts and component sales of $37.8 million and (iii) service and equipment installation revenue of $8.1 million.
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Domestic sales for the Materials Solutions segment increased $97.4 million, or 41.9%, for 2025 compared to 2024 primarily due higher (i) equipment sales of $59.1 million, (ii) parts and component sale of $31.4 million and (iii) service and installation revenue of $6.4 million.
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International sales for the Materials Solutions segment decreased $12.1 million, or 5.1%, for 2025 compared to 2024 primarily due to lower equipment sales of $20.8 million partially offset by higher parts and component sales of $6.4 million.
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Segment Operating Adjusted EBITDA Segment Operating Adjusted EBITDA is the measure of segment profit or loss used by our CEO, who is the chief operating decision maker ("CODM"), to evaluate performance and allocate resources to the reportable segments.
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Segment Operating Adjusted EBITDA is defined as net income or loss before the impact of interest income or expense, income taxes, depreciation and amortization and certain other adjustments that are not considered by the CODM in the evaluation of ongoing operating performance.
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Our presentation of Segment Operating Adjusted EBITDA may not be comparable to similar measures used by other companies and is not necessarily indicative of the results of operations that would have occurred had each reportable segment been an independent, stand-alone entity during the periods presented.
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See Note 19, Operations by Industry Segment and Geographic Area, of the Notes to the Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K for a reconciliation of Segment Operating Adjusted EBITDA to total consolidated net income attributable to controlling interest.
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Years Ended December 31, (in millions, except percentage data) 2025 2024 $ Change % Change Infrastructure Solutions $ 134.3 $ 121.5 $ 12.8 10.5 % Materials Solutions 55.6 37.2 18.4 49.5 % Infrastructure Solutions Segment Operating Adjusted EBITDA for the Infrastructure Solutions segment was $134.3 million for 2025 compared to $121.5 million for 2024, an increase of $12.8 million, or 10.5%.
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The increase in Segment Operating Adjusted EBITDA resulted primarily from the impact of favorable pricing coupled with net favorable volume and mix that generated $35.5 million higher gross profit.
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These increases in Segment Operating Adjusted EBITDA were partially offset by (i) increases in personnel-related costs of $10.5 29 Table of Contents million, (ii) higher quality-related costs of $5.9 million, (iii) net unfavorable inventory adjustments of $4.9 million and (iv) manufacturing inefficiencies of $4.5 million.
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Materials Solutions Segment Operating Adjusted EBITDA for the Materials Solutions segment was $55.6 million for 2025 compared to $37.2 million for 2024, an increase of $18.4 million, or 49.5%. The increase in Segment Operating Adjusted EBITDA resulted primarily from the impact of net favorable volume and mix coupled with favorable pricing that generated $46.1 million higher gross profit.
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These increases in Segment Operating Adjusted EBITDA were partially offset by higher personnel related costs of $13.9 million and manufacturing inefficiencies of $12.6 million. Corporate and Other Operations Corporate and Other operations had net expenses of $49.2 million for 2025 compared to $46.9 million for 2024, an increase of $2.3 million or 4.9%.

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Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Biggest changeItem 6. [Reserved] 23 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 23 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 33 Item 8. Financial Statements and Supplementary Data 34 Item 9 . Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 77 Item 9A. Controls and Procedures 77 Item 9B.
Biggest changeItem 6. [Reserved] 24 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 24 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 33 Item 8. Financial Statements and Supplementary Data 35 Item 9 . Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 78 Item 9A. Controls and Procedures 78

Item 7. Management's Discussion & Analysis

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

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Biggest changeThe Credit Agreement provides for (i) a revolving credit facility (consisting of revolving credit loans and swingline loans) and a letter of credit facility, in an aggregate amount of up to $250.0 million, (ii) an incremental credit facility in an aggregate amount not to exceed $125.0 million (the "Credit Facilities") and (iii) a maturity date of December 19, 2027.
Biggest changeOn July 1, 2025 and simultaneously with the consummation of the acquisition of TerraSource, we entered into a new credit agreement that provides for (i) a revolving credit facility, a term loan facility, a swingline facility and a letter of credit facility, in an initial aggregate amount of up to $600.0 million, and (ii) an incremental facilities limit in an aggregate amount not to exceed $150.0 million (collectively, the "2025 Credit Facilities").
The U.S. government enacted the Infrastructure Investment and Jobs Act ("IIJA") in November 2021 as a replacement for the prior program. The IIJA allocates $548 billion in government spending to new infrastructure over the five-year period concluding in 2026, with certain amounts specifically allocated to fund highway and bridge projects.
This program provides funding to improve the nation's roadway system. In November 2021, the U.S. government enacted the Infrastructure Investment and Jobs Act ("IIJA"). The IIJA allocates $548 billion in government spending to new infrastructure over the five-year period concluding in 2026, with certain amounts specifically allocated to fund highway and bridge projects.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the consolidated financial statements and the related notes included in Item 8 of this Annual Report on Form 10-K for the year ended December 31, 2024.
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations and the Consolidated Financial Statements and the accompanying notes thereto included in Part II, Item 8 of this Annual Report on Form 10-K. The risks and uncertainties described below are not the only ones we face.
Goodwill and Other Intangible Assets Impairment - Goodwill is tested for impairment annually on October 1, or more frequently, if events or circumstances indicate that the carrying amount of the asset may not be recoverable. Goodwill is allocated to, and evaluated for impairment at, two identified reporting units.
We must test our goodwill for impairment at least annually and other intangible assets if events or circumstances indicate that the carrying amount of the asset may not be recoverable, which could result in a material, non-cash write-down of goodwill or intangible assets and could have a material adverse impact on our results of operations and shareholders' equity.
Certain of our international subsidiaries in Australia, Brazil, Canada, South Africa and the United Kingdom each have separate credit facilities with local financial institutions primarily to finance short-term working capital needs, as well as to cover foreign exchange contracts, performance letters of credit, advance payment and retention guarantees.
Certain of our international subsidiaries in Australia, Brazil, Canada, South Africa and the United Kingdom have entered into their own independent loan agreements with the same lenders to our credit agreement as well as with other lending institutions.
Removed
The results of operations and other information included herein are not necessarily indicative of the financial condition, results of operations and cash flows that may be expected in future periods. This Annual Report on Form 10-K, including matters discussed in this Item 7.
Added
Additional risks and uncertainties not presently known to us, or that we presently deem less significant, may also impair our business, operating results and financial condition. If any of the following risks actually occur, our business, operating results and financial condition could be materially adversely affected.
Removed
Management's Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements relating to our plans, estimates and beliefs that involve important risks and uncertainties. See "Safe Harbor Statements Under the Private Securities Litigation Reform Act" and Part I, Item 1A.
Added
The order of these risk factors does not reflect their relative importance or likelihood of occurrence. Some of these risks and uncertainties could affect particular lines of business, while others could affect all of our businesses.
Removed
Risk Factors 23 Table of Content s for a discussion of uncertainties and assumptions that may cause actual results to differ materially from those expressed or implied in the forward-looking statements. This section of this Annual Report on Form 10-K generally discusses 2024 and 2023 items and year-to-year comparisons between 2024 and 2023.
Added
We, except as required by law, undertake no obligation to update or revise this risk factors discussion, whether as a result of new developments or otherwise. Economic and Industry Risks Downturns in the general economy or decreases in government infrastructure spending or commercial and residential construction spending may adversely affect our revenues and operating results.
Removed
A similar discussion of 2022 items and year-to-year comparisons between 2023 and 2022 can be found in Part II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations of our Annual Report on Form 10-K for the year ended December 31, 2023 .
Added
General economic downturns, including downturns in government infrastructure spending and the commercial and residential construction industries, could result in a material decrease in our revenues and operating results. Sales of our products are sensitive to the specific locations and regional economies in which they are sold in general, and in particular, changes in commercial construction spending and government infrastructure spending.
Removed
The financial condition and results of operations discussed in this Management's Discussion and Analysis of Financial Condition and Results of Operations are those of Astec Industries, Inc. and its consolidated subsidiaries, collectively, the "Company," "Astec," "we," "our" or "us." Business Overview We design, engineer, manufacture, market and service equipment and components used primarily in asphalt and concrete road building and related construction activities, as well as certain other products.
Added
In addition, many of our costs are fixed and cannot be quickly reduced in response to decreased demand.
Removed
Our products are used in each phase of road building, from quarrying and crushing the aggregate to application of the road surface.
Added
Several factors, including the following, could cause a downturn in the commercial and residential construction industries in which we operate: • a decrease in the availability of funds for construction; • declining economy domestically or internationally; • labor disputes in the construction industry causing work stoppages; • rising gas and oil prices; • rising steel prices and steel surcharges, including as a result of tariffs or other trade policies; • rising interest rates; • energy or building materials shortages; • natural disasters and inclement weather; • changes in regulations; • availability of credit for customers; • geopolitical conflicts; and • general economic and political uncertainty.
Removed
We also offer industrial automation controls and telematics platforms as well as manufacture certain equipment and components unrelated to road construction, including equipment for the mining, quarrying, construction, demolition, land clearing and recycling industries and port and rail yard operators; industrial heat transfer equipment; commercial whole-tree pulpwood chippers; horizontal grinders; blower trucks; commercial and industrial burners; and combustion control systems.
Added
A decrease or delay in government funding of highway construction and maintenance may cause our revenues and profits to decrease. Many of our customers depend on government funding of highway construction and maintenance and other infrastructure projects.
Removed
Our products are marketed both domestically and internationally primarily to asphalt and concrete producers; highway and heavy equipment contractors; utility contractors; sand and gravel producers; construction, demolition, recycling and crushing contractors; forestry and environmental recycling contractors; mine and quarry operators; port and inland terminal authorities; power stations and domestic and foreign government agencies.
Added
Historically, much of the U.S. highway infrastructure market has been driven by government spending programs, and federal government funding of infrastructure projects has typically been accomplished through bills that establish funding over a multi-year period. For example, the U.S. government funds highway and road improvements through the Federal Highway Trust Fund Program.
Removed
In addition to equipment sales, we manufacture and sell replacement parts for equipment in each of our product lines and replacement parts for some competitors' equipment. The distribution and sale of replacement parts is an integral part of our business.
Added
If Congress does not reauthorize or fully fund the IIJA when it expires at the end of fiscal year 2026, demand for our products could decline. Governmental funding that is committed or earmarked for federal highway projects is always subject to political decision making that may result in repeal or reduction.
Removed
Executive Summary Highlights of our financial results as of and for the year ended December 31, 2024 as compared to the prior year include the following: • Net sales were $1,305.1 million, a decrease of 2.5% • Gross profit was $327.9 million, a decrease of 0.9% • Income from operations was $23.2 million, a decrease of 52.3% • Net income attributable to Astec was $4.3 million, a decrease of 87.2% • Diluted income per share was $0.19, a decrease of 87.1% • Backlog was $419.6 million, a decrease of 26.4% Significant Items Impacting Financial Results in 2024 Strategic Transformation Program Our strategic transformation program includes the ongoing multi-year phased implementation of a standardized enterprise resource planning ("ERP") system, which is replacing much of our existing disparate core financial systems.
Added
Congress could pass legislation in future sessions that would allow for the diversion of previously appropriated highway funds for other national purposes, or it could restrict funding of infrastructure projects unless states comply with certain federal policies.
Removed
During 2024, we modified the pace of deployment of future site conversions to improve efficiencies and reduce business disruptions at our manufacturing sites, which will reduce the scope of the program to exclude sites outside North America.
Added
Furthermore, the 2024 U.S. presidential and congressional election results have altered and may continue to alter legislative priorities and have a material impact on government funding of infrastructure projects. The cyclical nature of our industry and the product mix of the equipment we sell may cause adverse fluctuations to our revenues and operating results.
Removed
To date, we have launched the human capital resources module in our U.S. locations and converted the operations of three manufacturing sites along with Corporate, two of which occurred during the second quarter of 2024. We expect the project to conclude in 2028 or 2029 with total approximate implementation costs anticipated to range from $180 to $200 million.
Added
We sell equipment primarily to contractors whose demand for equipment depends greatly upon the volume of road or utility construction projects underway or to be scheduled by both government and private entities. The volume and frequency of road and utility construction projects are cyclical; therefore, demand for many of our products is cyclical.
Removed
Through the year ended December 31, 2024, we have incurred total implementation costs of approximately $133 million. In addition, a lean manufacturing initiative at one of our largest sites was largely completed during 2023 with certain capital investments finalized in early 2024.
Added
The equipment we sell is durable and typically lasts for several years, which also contributes to the cyclical nature of the demand for our products. As a result, we may experience cyclical fluctuations to our revenues and operating results.
Removed
These investments, along with the other elements of the initiative, are expected to drive improvement in gross margin at that site in the second half of 2025. 24 Table of Content s See Note 21, Strategic Transformation and Restructuring, Impairment and Other Asset Charges, net of the Notes to the Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K for additional discussion of the costs related to these strategic initiatives.
Added
Any difficulty in managing our manufacturing workflow during downturns in demand could adversely affect our financial results. 11 Table of Contents Changes in interest rates and the lack of credit and third-party financing arrangements for our customers could reduce demand for our products.
Removed
Goodwill Impairment During the second quarter of 2024, we identified that indicators of goodwill impairment were present due to macroeconomic conditions, including declines in our publicly quoted share price and increased interest rates, as well as lower than expected operating results. These factors indicated that one or more of our reporting units may have fallen below their carrying amounts.
Added
In recent years, global interest rates have remained elevated compared to historically low levels that previously enabled low financing costs for construction projects.
Removed
We performed a qualitative assessment on all reporting units and concluded that a further quantitative analysis was required for the Materials Solutions reporting unit. Based on the quantitative impairment test, we determined that the carrying value of the Materials Solutions reporting unit exceeded its fair value as of June 30, 2024.
Added
Continued periods of higher interest rates, compared to historic low levels, could have a dampening effect on overall economic activity and/or the financial condition of our customers, either or both of which could negatively affect customer demand for our products, make it more difficult for customers to cost-effectively secure financing to fund the purchase of new equipment or our customers' ability to repay obligations to us.
Removed
As a result, we recognized a pretax non-cash goodwill impairment charge of $20.2 million in "Goodwill impairment" in the Consolidated Statements of Operations to fully impair the goodwill allocated to the Materials Solutions reporting unit. VenVer Litigation In October 2024, we reached an agreement to resolve the action styled VenVer S.A. and Americas Coil Tubing LLP v.
Added
Our customers’ inability to secure financing for projects on attractive terms could result in the delay, cancellation or downsizing of new purchases which could adversely affect our sales.
Removed
GEFCO, Inc. for $8.4 million, which was paid in the fourth quarter of 2024. In connection with the settlement, we recorded a loss of $8.4 million in "Restructuring, impairment and other asset charges, net" in the Consolidated Statements of Operations.
Added
Market Condition Risks Competition could reduce revenue from our products and services and cause us to lose market share, and our ability to compete in international jurisdictions is dependent upon trade policies, which are subject to change. We currently face strong competition in product performance, price and service.
Removed
See Note 16, Commitments and Contingencies of the Notes to the Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K for further discussion of this matter. 37 BP Litigation In September 2024, we reached an agreement to resolve the matter styled 37 Building Products, Ltd. v.
Added
Some of our domestic and international competitors have greater financial, product development and marketing resources than we have. If competition in our industry intensifies or if our current competitors enhance their products or lower their prices for competing products, we may lose sales or be required to lower the prices we charge for our products.
Removed
Telsmith, Inc., et al. for $6.3 million, which we paid in September 2024 (the "37 BP Litigation"). Upon settlement, the full loss contingency of $8.2 million, inclusive of post-judgment interest, that was recorded as of June 30, 2024 was released.
Added
This may reduce revenue from our products and services, lower our gross margins or cause us to lose market share. In addition to the general competitive challenges we face, international trade policies could negatively affect the demand for our products and services and reduce our competitive position in such markets.
Removed
The $1.9 million net impact of the loss contingency release and the final settlement amount was recorded in "Selling, general and administrative expenses" in the Consolidated Statements of Operations during the third quarter of 2024.
Added
The implementation of more restrictive trade policies, such as higher tariffs, duties or charges, in countries where we operate could negatively impact our business, results of operations and financial condition. In addition, unfavorable currency fluctuations could result in our products and services being more expensive than local competitors.
Removed
See Note 16, Commitments and Contingencies of the Notes to the Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K for further discussion of this matter.
Added
Our operations in foreign countries, and continued expansion into additional international markets, could expose us to risks inherent in doing business outside of the United States. In 2025, international sales represented approximately 19.9% of our total sales as compared to 22.2% in 2024. We plan to increase our already significant sales and production efforts in international markets.
Removed
Segment Changes Our two reportable segments are comprised of sites based upon the nature of the products or services produced, the type of customer for the products, the similarity of economic characteristics, the manner in which management reviews results and the nature of the production process, among other considerations.
Added
Both the sales from international operations and export sales are subject in varying degrees to risks inherent in doing business outside of the United States.
Removed
Based on a review of these factors, our Australia and Chile ("LatAm") sites and Astec Digital have changed reportable segments beginning January 1, 2024. The Australia and LatAm sites were previously reported in the Infrastructure Solutions segment and have moved to the Materials Solutions segment.
Added
Such risks include the possibility of unfavorable circumstances arising from host country laws or regulations and general economic and political conditions in the countries we do business, which are typically more volatile than the U.S. and more vulnerable to geopolitical conditions. In addition, the U.S.
Removed
Astec Digital was previously included in the Corporate and Other category and has moved to the Infrastructure Solutions segment. Prior periods have been revised to reflect the changes to the segment composition for comparability. Industry and Business Condition Our financial performance is affected by a number of factors, including the cyclical nature and varying conditions of the markets we serve.
Added
Government has established and, from time to time, revises sanctions that restrict or prohibit U.S. companies and their subsidiaries from doing business with certain foreign countries, entities and individuals. Doing business internationally also subjects us to numerous U.S. and foreign laws and regulations, including regulations relating to anti-bribery, privacy regulations and anti-boycott provisions.
Removed
Demand in these markets fluctuates in response to overall economic conditions and is particularly sensitive to the amount of public sector spending on infrastructure development, privately funded infrastructure development and changes in the prices of liquid asphalt, oil, natural gas and steel.
Added
We incur meaningful costs complying with these laws and regulations. The continued expansion of our international operations could increase the risk of violations of these laws in the future.
Removed
In addition, many of our markets are highly competitive, and our products compete worldwide with similar products produced and sold by a number of other manufacturers and dealers. Federal funding provides a significant portion of all highway, street, roadway and parking construction in the United States.
Added
Significant violations of these laws, or allegations of such violations, could harm our reputation, disrupt our business and result in significant fines and penalties that could have a material adverse effect on our results of operations or financial condition.
Removed
As federal highway funding programs have consistently been in place for several decades, we believe that these funding programs provide stability in the purchasing decisions of our customers by allowing them to plan and execute longer-term projects with federal legislation in place over a multi-year period.
Added
Our ability to understand our customers' specific preferences and requirements, and to develop, manufacture and market products that meet customer demand as we expand into additional international markets, could significantly affect our business results.
Removed
We believe that multi-year highway programs (such as the IIJA) have a positive impact on the domestic road construction industry. Significant portions of our revenues from the Infrastructure Solutions segment relate to the sale of equipment involved in the production, handling, recycling or application of asphalt mix and, to a lesser extent, concrete as surface choices for roads and highways.
Added
Our ability to match new product offerings to diverse global customers' anticipated preferences for different types and sizes of equipment and various equipment features and functionality, at affordable prices, is critical to our success. This requires a thorough understanding of our existing and potential customers on a global basis.
Removed
Liquid asphalt is a by-product of oil refining. An increase or decrease in the price of oil impacts the cost of asphalt, which is likely to alter demand for asphalt and therefore affect demand for certain of our products.
Added
Failure to deliver quality products that meet customer needs at competitive prices ahead of competitors could have a significant adverse effect on our business. Our international sales and associated operating results are subject to currency exchange risk. We are exposed to risk as a result of fluctuations in foreign currency exchange rates from transactions involving foreign operations and currencies.
Removed
While increasing oil prices may have a negative financial impact on many of our customers, our equipment can use a significant amount of reclaimed asphalt 25 Table of Content s pavement, thereby partially mitigating the effect of increased oil prices on the final cost of asphalt for the customer.
Added
We derive significant revenue, earnings and cash flow from operations outside of the U.S., where business operations are transacted in local currencies.
Removed
We continue to develop products and initiatives to reduce the amount of oil and related products required to produce asphalt. While oil prices had declined from the peak prices in 2022, throughout 2024 they remained relatively stable.
Added
Our exposure to currency exchange rate fluctuations results primarily from the translation exposure associated with the preparation of our consolidated financial statements, as well as from transaction exposure associated with transactions and assets and liabilities denominated in currencies other than the respective subsidiaries' functional currencies.
Removed
Price volatility continues to make it difficult to predict the costs of oil-based products used in road construction such as liquid asphalt and gasoline. Oil prices have routinely fluctuated in recent years and are expected to continue to fluctuate in the future. Based on the current macroeconomic environment, we anticipate that oil prices will experience moderate fluctuation throughout 2025.
Added
While our consolidated financial statements are reported in U.S. dollars, the financial statements of our international subsidiaries are prepared using their respective functional currency and translated into U.S. dollars by applying appropriate exchange rates.
Removed
Steel is a major component of our equipment. Throughout 2024, steel prices eased from the historically high levels experienced in 2022 and 2023. We anticipate that steel prices will increase during 2025, including as a result of the tariffs on all steel imports recently imposed by the Trump administration and other trade policies implemented by the U.S. and foreign governments.
Added
As a result, fluctuations in the exchange rate of the U.S. dollar relative to the local currencies could cause significant fluctuations in the value of our assets and liabilities, equity and operating results. 12 Table of Contents Additionally, our international sales include exporting both components and completed products from the U.S. to customers in other countries.
Removed
We anticipate that steel demand will increase in 2025 driven by a global focus on construction projects. We continue to employ flexible strategies to ensure supply and minimize the impact of price volatility. Potential ongoing constraints in the supply of certain steel products may continue pressuring the availability of other components used in our manufacturing process.
Added
Policies and geopolitical events affecting exchange rates could adversely affect the demand for construction equipment in many areas of the world. Further, any strengthening of the U.S. dollar or any other currency of a country in which we manufacture our products and/or any weakening of local currencies can increase the cost of our products in international markets.
Removed
Furthermore, given the volatility of steel prices and the nature of our customers' orders, we may not be able to pass through all increases in steel costs to our customers, which negatively impacts our gross profit and margins.
Added
Irrespective of any effect on the overall demand for construction equipment, the effect of these changes can make our products less competitive relative to local producing competitors or other non-U.S. competitors and, in extreme cases, can result in our products not being cost-effective for customers. As a result, our international sales and profit margins could decline.
Removed
New or ongoing geopolitical conflicts may cause a downturn in the construction industries in which we operate, cause an increase in oil prices, damage a significant portion of our inventory or materially impair our ability to distribute our products to customers.
Added
Manufacturing and Operations Risks Our profitability may be negatively affected by changes in the availability and price of certain parts, components and raw materials. We require access to various parts, components and raw materials at competitive prices in order to manufacture our products.
Removed
We monitor, adjust and potentially cease our operations in affected jurisdictions to ensure compliance with any governmental actions made in response to such conflicts. Whenever possible, we attempt to cover increased costs of production by adjusting the prices of our products.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

9 edited+0 added−1 removed6 unchanged
Biggest changeSignificant increases in the market price of steel can negatively impact our gross profit as we are often unable to pass along all of these price increases to our customers. A significant decline in the market price of steel could result in a decline in the market value of our equipment or parts.
Biggest changeWe anticipate minimal changes in steel prices during 2026 as domestic mills manage output and maintain pricing advantages over imports. Significant increases in the market price of steel can negatively impact our gross profit as we are often unable to pass along all of these price increases to our customers.
The majority of steel is scheduled on a just in time arrangement from suppliers to better manage inventory requirements at our manufacturing facilities. Based on market dynamics, we strategically and selectively order and inventory certain items beyond a just in time basis. The most significant component of our inventory is steel.
The majority of steel is scheduled on a just in time arrangement from suppliers to better manage inventory requirements at our manufacturing facilities. Based on market dynamics, we strategically and selectively order and inventory certain items beyond a just in time basis. 33 Table of Contents The most significant component of our inventory is steel.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Market Risk and Risk Management Policies Interest Rate Risk We are exposed to changes in interest rates, primarily from our Credit Facilities and our international credit facilities and term loan.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Market Risk and Risk Management Policies Interest Rate Risk We are exposed to changes in interest rates, primarily from our 2025 Credit Facilities and our international credit facilities.
A 10% fluctuation in foreign exchange rates throughout 2024 would have resulted in an impact of $17.7 million and $2.0 million to "Net sales" and "Net income (loss) attributable to controlling interest", respectively, in our Consolidated Statements of Operations for the year ended December 31, 2024.
A 10% fluctuation in foreign exchange rates throughout 2025 would have resulted in an impact of $17.7 million and $1.1 million to "Net sales" and "Net income attributable to controlling interest", respectively, in our Consolidated Statements of Operations for the year ended December 31, 2025.
These foreign operations represent 26.9% and 28.8% of total assets as of December 31, 2024 and 2023, respectively, and 13.5% and 13.4% of total net sales for the years ended December 31, 2024 and 2023, respectively.
These foreign operations represent 26.4% and 26.9% of total assets as of December 31, 2025 and 2024, respectively, and 12.5% and 13.5% of total net sales for the years ended December 31, 2025 and 2024, respectively.
We had outstanding Credit Facilities of $72.0 million as of December 31, 2023, a hypothetical 100 basis point increase in the interest rates would have had a $0.7 million impact on our annualized interest expense in 2023. We currently do not hedge variable interest.
We had outstanding borrowings on our 2022 Credit Facilities of $105.0 million as of December 31, 2024, a hypothetical 100 basis point increase in the interest rates would have had a $1.1 million impact on our annualized interest expense in 2024. We currently do not hedge variable interest.
Based on the outstanding balance on our domestic Credit Facilities of $105.0 million as of December 31, 2024, a hypothetical 100 basis point increase in the interest rates would have a $1.1 million impact on our annualized interest expense.
Based on the outstanding balance, a hypothetical 100 basis point increase in the interest rates would have a $3.5 million impact on our annualized interest expense.
Our Credit Facilities include a $250.0 million revolving credit facility, which bears interest based on market rates plus an applicable margin as defined in the Credit Agreement.
Our 2025 Credit Facilities include a term loan with outstanding indebtedness of $341.3 million as of December 31, 2025, which bears interest based on market rates plus an applicable margin as defined in the 2025 Credit Agreement.
We utilize strategies that include forward-looking contracts and advanced steel purchases to ensure supply and minimize the impact of price volatility. 33 Table of Content s
A significant decline in the market price of steel could result in a decline in the market value of our equipment or parts. We utilize strategies that include forward-looking contracts and advanced steel purchases to ensure supply and minimize the impact of price volatility. 34 Table of Contents
Removed
We anticipate that steel prices will increase during 2025, including as a result of the tariffs on all steel imports recently imposed by the Trump administration and other trade policies implemented by the U.S. and foreign governments.

Other ASTE 10-K year-over-year comparisons