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What changed in Owens Corning's 10-K — 2023 vs 2024

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

+342 added−296 removedSource: 10-K (2025-02-24) vs 10-K (2024-02-14)

Top changes in Owens Corning's 2024 10-K

342 paragraphs added · 296 removed · 217 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

68 edited+30 added−11 removed55 unchanged
Biggest changeRISK FACTORS (continued) Any breach of our security measures, or those of our third-party service providers, could result in unauthorized access to and misappropriation of our information, corruption of data or disruption of operations or transactions, any of which could have a material adverse effect on our business strategy, results of operations or financial condition.
Biggest changeAny breach of our security measures, or those of our third-party business partners, could result in unauthorized access to and misappropriation of our information, corruption or alteration of data or disruption of operations or transactions, any of which could have a material adverse effect on our business strategy, results of operations or financial condition, including costs related to remediation or the payment of ransom, litigation including individual claims or consumer class actions, commercial litigation, administrative, and civil or criminal investigations or actions, regulatory intervention and sanctions or fines, investigation and remediation costs, damage to our reputation and relationships with our business partners, and possible prolonged negative publicity.
Our sales may fall rapidly in response to declines in demand because we do not operate under long-term volume agreements to supply our customers and because of customer concentration in certain segments. Many of our customer volume commitments are short-term; therefore, we do not have a significant manufacturing backlog.
Our sales may fall rapidly in response to declines in demand because of customer concentration in certain segments and because we do not operate under long-term volume agreements to supply our customers . Many of our customer volume commitments are short-term; therefore, we do not have a significant manufacturing backlog.
Our international sales and operations are subject to risks and uncertainties, including: • difficulties and costs associated with complying with a wide variety of complex and changing laws, including securities laws, climate-related laws, tax laws, employment and pension-related laws, competition laws, U.S. and foreign export and trading laws, and laws governing improper business practices, treaties and regulations; • limitations on our ability to enforce legal rights and remedies; • adverse domestic or international economic and political conditions, business interruption, war and civil disturbance; • changes to tax, currency, or other laws or policies that may adversely impact our ability to repatriate cash from non-United States subsidiaries, make cross-border investments, or engage in other intercompany transactions; • future tax legislation, regulations, or related guidance or interpretations; • changes to tariffs or other import or export restrictions, penalties or sanctions, including modification or elimination of international agreements covering trade or investment; • costs and availability of shipping and transportation; • nationalization or forced relocation of properties by foreign governments; • currency exchange rate fluctuations between the United States Dollar and foreign currencies; and • uncertainty with respect to any potential changes to laws, regulations and policies that could exacerbate the risks described above.
Our international sales and operations are subject to risks and uncertainties, including: • difficulties and costs associated with complying with a wide variety of complex and changing laws, including securities laws, climate-related laws, tax laws, employment and pension-related laws, competition laws, U.S. and foreign export and trading laws, and laws governing improper business practices, treaties and regulations; • limitations on our ability to enforce legal rights and remedies; • adverse domestic or international economic and political conditions, business interruption, war and civil disturbance; • changes to tax, currency, or other laws or policies that may adversely impact our ability to repatriate cash from non-United States subsidiaries, make cross-border investments, or engage in other intercompany transactions; • future tax legislation, regulations, or related guidance or interpretations; • changes to import or export restrictions, penalties or sanctions, including modification or elimination of international agreements covering trade or investment; • costs and availability of shipping and transportation; • nationalization or forced relocation of properties by foreign governments; • currency exchange rate fluctuations between the United States Dollar and foreign currencies; and • uncertainty with respect to any potential changes to laws, regulations and policies that could exacerbate the risks described above.
Additionally, if the content, analyses, or recommendations that AI applications assist in producing are or are alleged to be deficient, inaccurate, or biased, our reputation, business, financial condition, and results of operations may be adversely affected. Climate change, weather conditions and storm activity could have a material adverse impact on our business, financial condition and results of operations.
Additionally, if the content, analyses, or recommendations that AI applications assist in producing are or are alleged to be deficient, inaccurate, or biased, our reputation, business, financial condition, and results of operations may be materially adversely affected. Climate change, weather conditions and storm activity could have a material adverse impact on our business, financial condition and results of operations.
We have established a range of security measures that are designed to protect against the unauthorized access to and misappropriation of our information, corruption of data, intentional or unintentional disclosure of confidential information, or disruption of operations.
We have established a range of security measures that are designed to protect against the unauthorized access to and misappropriation of our information, corruption or alteration of data, intentional or unintentional disclosure of confidential information, or disruption of operations.
Uncertainty about global economic conditions may also cause consumers of our products to reduce or postpone spending in response to tighter credit, negative financial news and/or declines in income or asset values. This could have a material adverse impact on the demand for our products and on our financial condition and operating results.
Uncertainty about global economic conditions may also cause consumers of our products to reduce or postpone spending or purchase alternative products in response to tighter credit, negative financial news and/or declines in income or asset values. This could have a material adverse impact on the demand for our products and on our financial condition and operating results.
The Company’s business may be materially and adversely impacted by changes in United States or global economic conditions, including global industrial production rates, inflation, deflation, interest rates, availability of capital, consumer spending rates, energy availability and commodity prices, trade laws, and the effects of governmental initiatives to manage economic conditions.
The Company’s business may be materially and adversely impacted by changes in United States or global economic conditions, including inflation, deflation, interest rates, availability of capital, consumer spending rates, energy availability and commodity prices, trade laws, and the effects of governmental initiatives to manage economic conditions.
Although emerging in nature, an increasing number of laws and regulations focused on product and chemical hazards, including regulations concerning the impact of product manufacturing and use on climate change, and resulting preferential product selection could also impact our ability to manufacture and sell certain products or require significant research and development investment and capital expenditures to meet regulatory requirements.
Although emerging in nature, an increasing number of laws and regulations focused on product and chemical hazards, including regulations concerning the impact of product manufacturing and use on climate change, and resulting preferential product selection could also impact our ability to manufacture and sell certain products or require significant research and development investment and capital expenditures to meet regulatory requirements. 13 Table of Contents
These changes and conditions could materially and adversely impact the Company’s operations, financial results and/or liquidity, including: • the financial stability of our customers or suppliers may be compromised, which could result in reduced demand for our products, additional bad debts for the Company or non-performance by suppliers; • one or more of the financial institutions associated with our credit facilities could cease to fulfill their funding obligations, or the amount of eligible receivables under our receivables securitization facility could decrease, which could materially and adversely impact our liquidity; • it may become more expensive or difficult to obtain financing or refinance the Company’s debt in the future; • the value of the Company’s assets held in pension plans may decline; and • the Company’s assets may be impaired or subject to write-down or write-off.
These changes and conditions could materially and adversely impact the Company’s operations, financial results and/or liquidity, including: • the financial stability of our customers or suppliers may be compromised, which could result in reduced demand for our products, additional bad debts for the Company or non-performance by suppliers; • one or more of the financial institutions associated with our credit facilities could cease to fulfill their funding obligations, or the amount of eligible receivables under our receivables securitization facility could decrease, which could materially and adversely impact our liquidity; • it may become more expensive or difficult to obtain financing or refinance the Company’s debt in the future; • the value of the Company’s assets held in pension plans may decline; and • the Company’s assets may be impaired or subject to write-down or write-off. 10 Table of Contents ITEM 1A.
Our failure to address these risks or other problems encountered in connection with our past or future acquisitions, including the planned acquisition of Masonite, investments and divestitures could cause us to fail to realize the anticipated benefits of such transactions, incur unanticipated liabilities, and harm our business generally.
Our failure to address these risks or other problems encountered in connection with our past or future acquisitions, including the acquisition of Masonite, investments and divestitures, including the divestiture of our GR business, could cause us to fail to realize the anticipated benefits of such transactions, incur unanticipated liabilities, and harm our business generally.
Our information technology systems, some of which are dependent on services provided by third parties, may be vulnerable to damage, interruption, or shutdown due to any number of causes outside of our control such as catastrophic events, natural disasters, fires, power outages, systems failures, telecommunications failures, employee error or malfeasance, security breaches, computer viruses or other malicious codes, ransomware, unauthorized access attempts, denial of service attacks, phishing, hacking, and other cyberattacks.
Our information technology systems, some of which are dependent on services provided by third parties, may be vulnerable to damage, interruption, or shutdown due to any number of causes outside of our control such as catastrophic events, natural disasters, fires, power outages, systems failures, telecommunications failures, employee error or malfeasance, security breaches, computer viruses or other malicious codes, ransomware, unauthorized access attempts, denial of service attacks, phishing or other social engineering attempts, hacking, and other cybersecurity incidents.
ITEM 1. BUSINESS (continued) Remediation activities generally involve a potential range of activities and costs related to soil, groundwater and sediment contamination. This can include pre-cleanup activities such as fact finding and investigation, risk assessment, feasibility studies, remedial action design and implementation (where actions may range from monitoring to removal of contaminants, to installation of longer-term remediation systems).
Remediation activities generally involve a potential range of activities and costs related to soil, groundwater and sediment contamination. This can include pre-cleanup activities such as fact finding and investigation, risk assessment, feasibility studies, remedial action design and implementation (where actions may range from monitoring to removal of contaminants, to installation of longer-term remediation systems).
It is our ambition to be a net-positive company, that is, one whose positive impact of our people and products, is greater than the negative impact of manufacturing our products. We work to continually increase the good our people and products do while we concurrently strive to reduce the negative environmental impact of our operations.
It is our ambition to be a company whose positive impact of our people and products, is greater than the negative impact of manufacturing our products. We work to continually increase the good our people and products do while we concurrently strive to reduce the negative environmental impact of our operations.
At December 31, 2023, the Company had an accrual totaling $4 million for its environmental liabilities, of which the current portion is $1 million. Changes in required remediation procedures or timing of those procedures at existing legacy sites, or discovery of contamination at additional sites, could result in material increases to the Company’s environmental obligations.
At December 31, 2024, the Company had an accrual totaling $4 million for its environmental liabilities, of which the current portion is $2 million. Changes in required remediation procedures or timing of those procedures at existing legacy sites, or discovery of contamination at additional sites, could result in material increases to the Company’s environmental obligations.
In addition, we operate in many parts of the world that have experienced governmental corruption and we could be adversely affected by violations of the Foreign Corrupt Practices Act (“FCPA”) and similar worldwide anti-corruption laws.
RISK FACTORS (continued) In addition, we operate in many parts of the world that have experienced governmental corruption and we could be adversely affected by violations of the Foreign Corrupt Practices Act (“FCPA”) and similar worldwide anti-corruption laws.
Additionally, severely low or high temperatures may lead to significant and immediate spikes in costs of natural gas, electricity and other commodities that could negatively affect our results of operations. We will not be insured against all potential losses and could be seriously harmed by natural disasters, catastrophes, pandemics, theft or sabotage.
Additionally, severely low or high temperatures may lead to significant and immediate spikes in costs of natural gas, electricity and other commodities that could negatively affect our results of operations. We may not be insured against potential material manufacturing losses or disruptions and could be seriously harmed by natural disasters, catastrophes, pandemics, theft or sabotage.
Despite our contractual supply agreements with many of our suppliers, and despite any programs we may undertake to mitigate supply risks, it is possible that we could experience a lack of certain raw materials that limits our ability to manufacture our products, thereby materially and adversely impacting our business, financial condition and results of operations.
Despite our contractual supply agreements with many of our suppliers, and despite any programs we may undertake to mitigate supply risks, it is possible that we could experience a lack of certain raw materials that limits our ability to manufacture our products, thereby materially and adversely impacting our business, financial condition and results of operations. 7 Table of Contents ITEM 1A.
In 2023, the Company also engaged in an Employee Value Proposition survey and considered employee feedback in formulating its value proposition, including changes to compensation and benefits offerings such as sick leave enhancements for primary employees and improvements to our facilities, including the roll-out of personal dignity spaces.
In 2023, the Company also engaged in an Employee Value Proposition survey and considered employee feedback in formulating its value proposition, including changes to compensation and benefits offerings such as sick leave enhancements for primary employees and improvements to our facilities, including the roll-out of personal dignity spaces. 5 Table of Contents ITEM 1.
Owens Corning invests in research and development on climate-related risks and opportunities. Table of Contents -5- ITEM 1. BUSINESS (continued) Human Capital Resources The Company’s long-term success is dependent upon its access to and development of management and primary employees who are sufficiently skilled and capable of the work necessary to achieve the Company’s short-and long-term business objectives.
Owens Corning invests in research and development on climate-related risks and opportunities. Human Capital Resources The Company’s long-term success is dependent upon its access to and development of management and primary employees who are sufficiently skilled and capable of the work necessary to achieve the Company’s short- and long-term business objectives.
Protecting against these threats may require significant resources, and we may not be able to implement measures that will protect against all of the significant risks to our information technology systems.
Protecting against these threats requires significant resources, and is expected to continue to require significant resources, and we may not be able to implement measures that will protect against all of the significant risks to our information technology systems.
For example, during the second quarter of 2023, the Company’s subsidiary, Paroc Group OY (“Paroc”), notified the appropriate European maritime regulatory authorities that specific insulation products in its marine insulation product line may not meet certain fire safety requirements in accordance with their certifications.
RISK FACTORS (continued) For example, during the second quarter of 2023, the Company’s subsidiary, Paroc Group OY (“Paroc”), which was acquired in 2018, notified the appropriate European maritime regulatory authorities that specific insulation products in its marine insulation product line may not meet certain fire safety requirements in accordance with their certifications.
Some of the ways we have historically grown or restructured our business have been through acquisitions, joint ventures, the expansion of our production capacity and divestitures. Our ability to grow or restructure our business depends upon our ability to identify, negotiate and finance suitable arrangements.
Some of the ways we have historically grown or restructured our business have been through acquisitions, including our 2024 acquisition of Masonite, joint ventures, the expansion of our production capacity and divestitures, including the divestiture of our GR business. Our ability to grow or restructure our business depends upon our ability to identify, negotiate and finance suitable arrangements.
RISK FACTORS (continued) compete, we must continue to develop new products that meet changing consumer preferences and successfully develop, manufacture and market these new products. If we are not able to successfully commercialize our innovation efforts, we may lose market share.
In addition, to effectively compete, we must continue to develop new products that meet changing consumer preferences and successfully develop, manufacture and market these new products. If we are not able to successfully commercialize our innovation efforts, we may lose market share.
RISK FACTORS (continued) consolidate, they could attempt to demand more favorable contractual terms, which would place additional pressure on our margins and cash flows. Lower demand for our products, loss of key customers and material changes to contractual terms could materially and adversely impact our business, financial condition and results of operations.
In addition, if key customers experience financial pressure or consolidate, they could attempt to demand more favorable contractual terms, which would place additional pressure on our margins and cash flows. Lower demand for our products, loss of key customers and material changes to contractual terms could materially and adversely impact our business, financial condition and results of operations.
Any liability not covered by insurance or that exceeds our established reserves could materially and adversely impact our business, financial condition and results of operations.
Any liability not covered by insurance or that exceeds our established reserves could materially and adversely impact our business, financial condition and results of operations. 12 Table of Contents ITEM 1A.
These laws and regulations generally prohibit competitors from fixing prices, boycotting competitors, or engaging in other conduct that unreasonably restrains competition, and such laws and regulations may impact potential business relationships or transactions with third parties in the future.
These laws and regulations generally prohibit competitors from fixing prices, boycotting competitors, or engaging in other conduct that 4 Table of Contents ITEM 1. BUSINESS (continued) unreasonably restrains competition, and such laws and regulations may impact potential business relationships or transactions with third parties in the future.
We cannot predict if or when interest rates or inflation levels will stabilize or decline or the impact that any such decline may have on repair and remodel activity, new construction activity, demand for our products, our business generally, or our financial condition.
Due to this uncertainty, we cannot predict if or when interest rates or inflation levels will stabilize or the impact that this uncertainty may have on repair and remodel activity, new construction activity, demand for our products, our business generally, or our financial condition.
An attack or other problem with our systems could also result in the disclosure of proprietary information about our business or confidential information concerning our customers or employees, which could result in significant damage to our business and our reputation.
A cybersecurity incident or other problem with our systems could also result in the disclosure of proprietary information about our business or confidential information concerning our customers, suppliers or employees, which could result in significant damage to our business and our reputation.
We also face competition from the introduction by competitors of new products or technologies that may address our customers’ needs in a better manner, whether based on considerations of pricing, usability, effectiveness, sustainability, quality or other features or benefits. In addition, to effectively Table of Contents -11- ITEM 1A.
We also face competition from the introduction of new products or technologies, by competitors, that may address our customers’ needs in a better manner, whether based on considerations of pricing, usability, effectiveness, sustainability, quality or other features or benefits.
Employee Performance and Related Objectives We also focus on evaluating and managing employee performance, development, succession planning, and turnover. Our goal is to create a high-performance culture and teams that are diverse, capable and engaged. We strive to have clear objectives, effective performance management, and a structure that includes regular feedback, talent reviews, succession planning, development, and compensation analysis.
Our goal is to create a high-performance culture and teams that are diverse, capable and engaged. We strive to have clear objectives, effective performance management, and a structure that includes regular feedback, talent reviews, succession planning, development, and compensation analysis.
Our ability to sell some of the products in our Insulation and Roofing segments is dependent on a limited number of customers, who account for a significant portion of such sales. In 2023, we had one customer that represented 11% of our annual sales.
Our ability to sell some of the products in our Insulation, Roofing, and Doors segments is dependent on a limited number of customers, who account for a significant portion of such sales. In 2024, we had two customers that represented 13% and 11% of our annual net sales.
For example, natural gas forms the primary energy source for our European operations and our European operations can be directly affected by volatility in the cost and availability of natural gas.
Energy prices, in particular oil and natural gas, have fluctuated in recent years. For example, natural gas forms the primary energy source for our European operations and our European operations can be directly affected by volatility in the cost and availability of natural gas.
As a result, we cannot predict future developments in AI and related impacts to our business and our industry. If we are unable to successfully and accurately develop, integrate and use AI technology, as well as address the risks and challenges associated with AI, our business, results of operations and financial position could be negatively impacted.
If we are unable to successfully and accurately develop, integrate and use AI technology, as well as address the risks and challenges associated with AI, our business, results of operations and financial position could be negatively impacted.
More information about Owens Corning’s approach to human capital and other social issues can be found in our Sustainability Report on our website. 1 AVAILABILITY OF INFORMATION Owens Corning makes available, free of charge, through its website, the Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and all amendments to those reports as soon as reasonably practicable after such material is electronically filed with or furnished to the Securities and Exchange Commission.
AVAILABILITY OF INFORMATION Owens Corning makes available, free of charge, through its website, the Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and all amendments to those reports as soon as reasonably practicable after such material is electronically filed with or furnished to the Securities and Exchange Commission (the "SEC").
In addition, we rely on a number of third-party service providers to execute certain business processes and maintain certain information technology systems and infrastructure, and any breach of security on their part could impair our ability to effectively operate. Table of Contents -10- ITEM 1A.
In addition, we rely on a number of third-party business partners to execute certain business processes and maintain certain information technology systems and infrastructure, evaluate defenses and implement recommendations and any breach of security on their part could impair our ability to effectively operate.
Climate change could have an impact on several aspects of our business, financial condition and results of operations. Weather phenomena associated with climate change, such as flooding or altered storm activity, may impact our ability to operate our manufacturing facilities in some locations. In addition, customer preferences for lower-carbon and more environmentally friendly solutions could impact demand for our products.
Climate change could have an impact on several aspects of our business, financial condition and results of operations. Weather phenomena associated with climate change, such as flooding or altered storm activity, may impact our ability to operate our manufacturing facilities and corporate offices in some locations.
With the volatility in the current global economic climate, inflation and geopolitical events around the world, including the Russian invasion of Ukraine and the Israel-Hamas conflict, it is difficult for us to predict the complete impact of the foregoing matters on our business and results of operations.
RISK FACTORS (continued) With the volatility in the current global economic climate, inflation and geopolitical events around the world, it is difficult for us to predict the future impact of the foregoing matters on our business and results of operations.
As we continue to expand our business globally, we may have difficulty anticipating and effectively managing these and other risks that our international operations may face, which may adversely impact our business, financial condition and results of operations.
We may have difficulty anticipating and effectively managing these and other risks that our international operations may face, which may adversely impact our business, financial condition and results of operations. 8 Table of Contents ITEM 1A.
We also seek to foster positive and productive relations with the labor organizations representing them. Owens Corning employees contribute service hours to boards, special causes and nonprofit organizations in the communities where they live and operate.
Our training efforts encompass the Code of Conduct and other areas of compliance and development as relevant to employees. We also seek to foster positive and productive relations with the labor organizations representing them. Owens Corning employees contribute service hours to boards, special causes and nonprofit organizations in the communities where they live and operate.
In some cases, we face competition from manufacturers in countries able to produce similar products at lower costs. Price competition or overcapacity may limit our ability to raise prices for our products, may force us to reduce prices and may also result in reduced levels of demand for our products and cause us to lose market share.
Price competition or overcapacity may limit our ability to raise prices for our products, may force us to reduce prices and may also result in reduced levels of demand for our products and cause us to lose market share.
In addition, consistent with industry practice, we provide warranties on many of our products. We may experience costs of warranty claims when the product is not performing to the satisfaction of the claimant even though it has not caused harm to others or property.
We may experience costs of warranty claims when the product is not performing to the satisfaction of the claimant even though it has not caused harm to others or property.
We face an inherent business risk of exposure to product liability or other claims in the event our products are alleged to be defective or that Table of Contents -12- ITEM 1A. RISK FACTORS (continued) the use of our products is alleged to have resulted in harm to others or to property.
We face an inherent business risk of exposure to product liability or other claims in the event our products are alleged to be defective or that the use of our products is alleged to have resulted in harm to others or to property. We may, in the future, incur liability if product liability lawsuits against us are successful.
Acquisitions, joint ventures, production capacity expansions and divestitures involve substantial risks, including: • unforeseen difficulties in operations, technologies, products, services, accounting and personnel; • increased cybersecurity threats or incidents; • diversion of financial and management resources from existing operations; • unforeseen difficulties related to entering geographic regions, markets or product lines where we do not have prior experience; • risks relating to obtaining sufficient financing; • difficulty in integrating the acquired business’ standards, processes, procedures and controls with our existing operations; • potential loss of key employees; • unanticipated competitive responses; • potential loss of customers or suppliers; and • undisclosed or undiscovered liabilities or claims, or retention of unpredictable future liabilities.
RISK FACTORS (continued) • unforeseen difficulties related to entering geographic regions, markets or product lines where we do not have prior experience; • risks relating to obtaining sufficient financing; • difficulty in integrating the acquired business’ standards, processes, procedures and controls with our existing operations; • potential loss of key employees; • unanticipated competitive responses; • potential loss of customers or suppliers; and • undisclosed or undiscovered liabilities or claims, or retention of unpredictable future liabilities.
We may, in the future, incur liability if product liability lawsuits against us are successful. Moreover, any such lawsuits, whether or not successful, could result in adverse publicity to us, which could cause our sales to decline.
Moreover, any such lawsuits, whether or not successful, could result in adverse publicity to us, which could cause our sales to decline.
As of December 31, 2023, Owens Corning had approximately 18,000 employees, of which approximately 9,000 were located outside the United States. Approximately 8,200 (46%) of hourly employees are subject to collective bargaining agreements. The Company regularly engages its salaried, non-represented and represented primary employees to collect feedback and based on that feedback believes employee engagement and relations are good.
As of December 31, 2024, Owens Corning had approximately 25,000 employees, of which approximately 12,000 were located outside the United States. Approximately 60% of hourly employees are subject to collective bargaining agreements. The Company regularly engages its salaried, non-represented and represented primary employees to collect feedback.
We are subject to risks relating to our information technology systems (including cybersecurity) risks, and any failure to adequately protect our critical information technology systems could materially affect our operations. We rely on information technology systems across our operations, including for management, supply chain and financial information and various other processes and transactions.
We are subject to risks relating to our information technology systems (including cybersecurity) risks, and any failure to adequately protect our critical information technology systems could materially affect our operations and financial results.
Safety and Well-Being One of our primary objectives is the safety and well-being of our employees. Working safely is an unconditional, organization-wide expectation at Owens Corning, which we believe directly benefits employees’ lives, improves our manufacturing processes and reduces our costs. The Company maintains comprehensive safety programs focused on identifying hazards and eliminating risks that can lead to severe injuries.
BUSINESS (continued) Safety and Well-Being One of our primary objectives is the safety and well-being of our employees. Working safely is an unconditional, organization-wide expectation at Owens Corning, which we believe directly benefits employees’ lives, improves our manufacturing processes and reduces our costs.
The loss of key customers for these products, a consolidation of key customers or a significant reduction in sales to those customers, could significantly reduce our revenues from these products. In addition, if key customers experience financial pressure or Table of Contents -9- ITEM 1A.
The loss of one or more of these key customers, a consolidation of key customers or a significant reduction in sales to those customers could significantly reduce our revenues from these products.
Although we established an estimated liability for expected future costs related to this matter, it is reasonably possible that additional product recall costs could be incurred that exceed the estimated liability by amounts that could be material to our consolidated financial statements. These actions may also result in harm to our reputation and results of operations.
Although we established an estimated liability for expected future costs related to this matter, it is reasonably possible that additional product recall costs could be incurred that exceed the estimated liability by amounts that could be material to our consolidated financial statements. Due to these nonconformances, the Company reviewed the Paroc insulation product portfolio. The review has concluded.
These programs aim to enable the Company’s employees to connect with the community, further improve its reputation locally and globally, and instill a sense of pride in the workforce. Owens Corning is a recognized leader on advancing social issues, including issues related to diversity, equity and inclusion and human rights.
These programs aim to enable the Company’s employees to connect with the community, further improve its reputation locally and globally, and instill a sense of pride in the workforce.
We face significant competition in the markets we serve and we may not be able to compete successfully. All of the markets we serve are highly competitive. We compete with manufacturers and distributors, both within and outside the United States. Some of our competitors may have superior financial, technical, marketing and other resources.
We compete with manufacturers and distributors, both within and outside the United States. Some of our competitors may have superior financial, technical, marketing and other resources. In some cases, we face competition from manufacturers in countries able to produce similar products at lower costs.
We may be unable to transport our raw materials or products in a timely manner or at economically favorable rates in certain circumstances, particularly in cases of adverse market conditions or disruptions to transportation infrastructure. Supply constraints and increases in the cost of energy could have a material adverse impact on our business or results of operations.
We are also dependent on third-party freight carriers to transport some of our raw materials and products. We may be unable to transport our raw materials or products in a timely manner or at economically favorable rates in certain circumstances, particularly in cases of adverse market conditions or disruptions to transportation infrastructure.
In addition, our operations in certain geographic locations may be particularly vulnerable to cybersecurity attacks or other problems. Any such damage, interruption, or shutdown could cause delays or cancellation of customer orders or impede the manufacture or shipment of products, processing of transactions or reporting of financial results.
Any such damage, interruption, or shutdown could cause delays or cancellation of customer orders or impede the manufacture or shipment of products, processing of transactions or reporting of financial results.
AI is a new and emerging technology in early stages of commercial use and presents a number of risks inherent in its use, including, but not limited to, ethical considerations, public perception, intellectual property protection, regulatory compliance, privacy concerns and data security, all of which could have a material adverse effect on our business, results of operations and financial position.
These risks include, but are not limited to, ethical considerations, public perception, intellectual property protection, regulatory compliance, privacy concerns and data security, all of which could have a material adverse effect on our business, results of operations and financial position. As a result, we cannot predict future developments in AI and related impacts to our business and our industry.
The cost of producing our products is sensitive to the price of energy, including its impact on transport costs which is subject to factors outside of our control. Energy prices, in particular oil and natural gas, have fluctuated in recent years.
Supply constraints and increases in the cost of energy could have a material adverse impact on our business or results of operations. The cost of producing our products is sensitive to the price of energy, including its impact on transport costs which is subject to factors outside of our control.
We have started to assess the use of AI technology to drive productivity and data analytics. While we aim to develop, integrate and use AI responsibly, we may ultimately be unsuccessful in identifying or resolving issues, such as accuracy issues, cybersecurity risks, unintended biases, and discriminatory outputs, before they arise.
RISK FACTORS (continued) we may ultimately be unsuccessful in identifying or resolving issues, such as accuracy issues, cybersecurity risks, unintended biases, and discriminatory outputs, before they arise.
BUSINESS (continued) Ethics and compliance efforts include our support of the Owens Corning Code of Conduct (“Code of Conduct”), which is dedicated to encouraging compliance with a range of legal guidelines and our corporate values. Our training efforts encompass the Code of Conduct and other areas of compliance and development as relevant to employees.
We believe that inclusion and diversity add value to the business by fostering an environment that leads to high engagement and innovative thinking in the workplace. Ethics and compliance efforts include our support of the Owens Corning Code of Conduct (“Code of Conduct”), which is dedicated to encouraging compliance with a range of legal guidelines and our corporate values.
In the fall of 2023, the Company kicked off its employee-developed “Safer Together” initiative, intended to increase employee focus and collective engagement on safety. One of our primary safety measures is the Recordable Incident Rate (“RIR”) as defined by the United States Bureau of Labor Statistics.
One of our primary safety measures is the Recordable Incident Rate (“RIR”) as defined by the United States Bureau of Labor Statistics.
For the year ended December 31, 2023, our RIR was 0.60, compared to 0.65 as reported in the same period for the prior year. Additionally, with our Healthy Living platform, we provide a multifaceted well-being program designed to drive sustainable, long-term change, improve the health and lives of employees, and strengthen the culture and work experience.
Additionally, with our Healthy Living platform, we provide a multifaceted well-being program designed to drive sustainable, long-term change, improve the health and lives of employees, and strengthen the culture and work experience. Employee Performance and Related Objectives We also focus on evaluating and managing employee performance, development, succession planning and turnover.
These documents are available through the Investor Relations page of the Company’s website at www.owenscorning.com.
These documents are available through the Investor Relations page of the Company’s website at www.owenscorning.com. Copies of any materials we file with the SEC can also be obtained free of charge through the SEC’s website at http://www.sec.gov.
Furthermore, some of our sales are concentrated in certain geographic areas, and market growth that is skewed to other geographic areas may negatively impact our rate of growth or market share. Worldwide economic conditions and credit tightening could have a material adverse impact on the Company.
Furthermore, some of our sales are concentrated in certain geographic areas, and market growth that is skewed to other geographic areas may negatively impact our rate of growth or market share. We face significant competition in the markets we serve and we may not be able to compete successfully. All of the markets we serve are highly competitive.
Emerging issues related to our development, integration and use of artificial intelligence (“AI”) could give rise to legal or regulatory action, damage our reputation or otherwise materially harm our business . Our development, integration and use of AI technology in our operations remains in the early phases.
Our efforts to comply with privacy and data protection laws may impose significant costs and challenges that are likely to increase over time. Emerging issues related to our development, integration and use of artificial intelligence (“AI”) could give rise to legal or regulatory action, damage our reputation or otherwise materially harm our business .
Interest rates increased substantially in fiscal years 2022 and 2023, and may continue to increase. The combination of high interest rates and high levels of inflation have reduced the affordability of mortgages and other financing options, and increased the cost of home improvement projects.
Interest rates increased substantially in the past few years, remained elevated in 2024, and are currently expected to decrease slightly but stay relatively high in 2025. The combination of high interest rates and high levels of inflation reduces the affordability of mortgages and other financing options, and increases the cost of home improvement projects.
Table of Contents -7- ITEM 1A. RISK FACTORS In an enterprise as diverse as ours, a wide range of factors could affect future performance. We discuss in this section some of the risk factors that could materially and adversely affect our business, financial condition, value and results of operations.
We discuss in this section some of the risk factors that could materially and adversely affect our business, financial condition, value and results of operations. You should not interpret the disclosure of any risk factor to imply that the risk has not already materialized.
Our ability to effectively manage our business depends on the security, reliability and capacity of these systems.
We rely on information technology systems, including information technology systems of our third-party business partners, across our operations, including for management, supply chain and financial information and various other processes and transactions. Our ability to effectively manage our business depends on the security, reliability and capacity of these systems.
Copies of any materials we file with the SEC can also be obtained free of charge through the SEC’s website at http://www.sec.gov. 1 The information on our website, including our Sustainability Report, is not, and will not be deemed to be, a part of this Annual Report on Form 10-K or incorporated into any of our other filings with the SEC.
The information on our website is not, and will not be deemed to be, a part of this Annual Report on Form 10-K or incorporated into any of our other filings with the SEC. 6 Table of Contents ITEM 1A. RISK FACTORS In an enterprise as diverse as ours, a wide range of factors could affect future performance.
These trends have likely resulted in reduced levels of repair and remodel as well as new construction activity and demand for our products, and we expect these trends may continue for the foreseeable future.
These trends have likely resulted in reduced levels of repair and remodel as well as new construction activity and demand for our products. Additionally, market reactions to the new U.S. federal administration's trade policies, deregulation efforts, and stance towards the Federal Reserve could create economic uncertainty, potentially leading to fluctuations in inflation and interest rates.
Our efforts to comply with privacy and data protection laws may impose significant costs and challenges that are likely to increase over time. Our efforts in acquiring and integrating other businesses, establishing joint ventures, expanding our production capacity or divesting assets are subject to a number of risks.
If we fail to maintain our current standards for product quality, the scope of our distribution capabilities or our customer relationships, our reputation, financial condition, results of operations and cash flows could be adversely affected. Our efforts in acquiring and integrating other businesses, establishing joint ventures, expanding our production capacity or divesting assets are subject to a number of risks.
Removed
We believe that inclusion and diversity add value to the business by fostering an environment that leads to high engagement and innovative thinking in the workplace.
Added
ITEM 1. BUSINESS (continued) Environmental Control Owens Corning has established policies and procedures that are intended to ensure that its operations are conducted in compliance with all relevant laws and regulations and that enable the Company to meet its high standards for corporate sustainability and environmental stewardship.
Removed
Five years following the Company's pledge to diversity & inclusion, there is more work to be done, and the Company continues to pursue diversity in its workforce through diverse candidate slates, diversity on hiring committees, and development programs, and the continued focus on development of management skills needed to sustain progress in this area through the roll-out of inclusive leadership training across the organization.
Added
Our manufacturing facilities are subject to numerous foreign, federal, state and local laws and regulations relating to the presence of hazardous materials, pollution and protection of the environment, including emissions to air, reductions of greenhouse gases, discharges to water, management of hazardous materials, handling and disposal of solid wastes, use of chemicals in our manufacturing processes and remediation of contaminated sites.
Removed
Owens Corning operates programs that foster gender and ethnic diversity as well as equality within its workforce, including supporting various employee-led affinity groups, so its employees feel valued and appreciated for the distinct voices they bring to the team.
Added
All Company manufacturing facilities are either ISO 14001 certified or deploy environmental management systems based on ISO 14001 principles. The Company’s 2030 Sustainability Goals include targets related to significant global reductions in energy use, water consumption, waste to landfill, and emissions of greenhouse gases, fine particulate matter, and volatile organic air emissions, and protection of biodiversity.
Removed
As of December 31, 2023, the composition of our Board of Directors was 60% demographically diverse, which includes gender, race, ethnicity, nationality, national origin or other elements of one’s identity. Leadership positions were comprised of approximately 29% women globally and 18% people of color in the United States.
Added
The Company is dedicated to continuous improvement in its environmental, health and safety performance and to achieving its 2030 Sustainability Goals. The Company has not experienced a material adverse effect upon its capital expenditures or competitive position as a result of environmental control legislation and regulations. Operating costs associated with environmental compliance were approximately $59 million in 2024.
Removed
Our 2030 diversity goals set targets for our leadership positions of 35% women globally and 22% people of color in the United States. The Company has a robust pay equity system, which includes multiple processes and controls to prevent pay equity gaps from occurring.
Added
The Company continues to invest in equipment and process modifications to remain in compliance with applicable environmental laws and regulations worldwide. Our manufacturing facilities are subject to numerous national, state and local environmental protection laws and regulations. Regulatory activities of particular importance to our operations include those addressing air pollution, water pollution, waste disposal and chemical control.
Removed
We perform a biennial pay equity review with the assistance of a third-party vendor who utilizes a strong, statistical analysis of pay equity across our global salaried workforce. We promptly remediate all identified and substantiated pay gaps through pay increases. Table of Contents -6- ITEM 1.
Added
It is possible that new laws and regulations will specifically address climate change, volatile organic compounds, ozone forming emissions and fine particulate matter. New environmental and chemical regulations could impact our ability to expand production or construct new facilities in geographic regions in which we operate.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

16 edited+9 added−13 removed53 unchanged
Biggest changeOur operations require substantial capital, leading to high levels of fixed costs that will be incurred regardless of our level of business activity. Our businesses are capital intensive, and regularly require capital expenditures to expand operations, maintain equipment, increase operating efficiency and comply with applicable laws and regulations, leading to high fixed costs, including depreciation expense.
Biggest changeOur businesses are capital intensive, and regularly require capital expenditures to expand operations, maintain equipment, increase operating efficiency and comply with applicable laws and regulations, leading to high fixed costs, including depreciation expense. Increased regulatory requirements for our operations could lead to additional or higher fixed costs in the future.
Claims of intellectual property infringement also may require us to redesign affected products, pay costly damage awards, or face injunctions prohibiting us from manufacturing, importing, marketing or selling certain of our products. Even if we have agreements to indemnify us, indemnifying parties may be unable or unwilling to do so. Table of Contents -14- ITEM 1A.
Claims of intellectual property infringement also may require us to redesign affected products, pay costly damage awards, or face injunctions prohibiting us from manufacturing, importing, marketing or selling certain of our products. Even if we have agreements to indemnify us, indemnifying parties may be unable or unwilling to do so. 14 Table of Contents ITEM 1A.
Foreign, federal, state and local regulatory and legislative bodies have enacted or proposed various legislative and regulatory measures relating to increased transparency and standardization of reporting matters that may include climate change, regulating GHG emissions, water usage, recycling of plastic materials, and energy policies, including waste tax, and other governmental charges and mandates.
Foreign, federal, state and local regulatory and legislative bodies have enacted or proposed various legislative and regulatory measures relating to increased transparency and standardization of reporting matters that may include climate change, regulating GHG emissions, water usage, deforestation, recycling of plastic materials, and energy policies, including waste tax, and other governmental charges and mandates.
Our debt level and degree of leverage, particularly if we complete the Masonite acquisition, could have important consequences, including the following: • our ability to obtain additional debt or equity financing for working capital, capital expenditures, debt service requirements, acquisitions and general corporate or other purposes may be limited; • a substantial portion of our cash flow could be required for the payment of principal and interest on our indebtedness, and may not be available for other business purposes; • certain of our available borrowings are at variable rates of interest, exposing us to the risk of increased interest rates to borrow in the future; • if due to liquidity needs we must replace any indebtedness upon maturity, we would be exposed to the risk that we may not be able to refinance such indebtedness; • our ability to adjust to changing market conditions may be limited and place us at a competitive disadvantage compared to our competitors if they have less debt; and • we may be vulnerable in a downturn in general economic conditions or in our business, or we may be unable to carry out important capital spending.
Our debt level and degree of leverage could have important consequences, including the following: • our ability to obtain additional debt or equity financing for working capital, capital expenditures, debt service requirements, acquisitions and general corporate or other purposes may be limited; • a substantial portion of our cash flow could be required for the payment of principal and interest on our indebtedness, and may not be available for other business purposes; • certain of our available borrowings are at variable rates of interest, exposing us to the risk of increased interest rates to borrow in the future; • if due to liquidity needs we must replace any indebtedness upon maturity, we would be exposed to the risk that we may not be able to refinance such indebtedness; • our ability to adjust to changing market conditions may be limited and place us at a competitive disadvantage compared to our competitors if they have less debt; and • we may be vulnerable in a downturn in general economic conditions or in our business, or we may be unable to carry out important capital spending.
Significant changes in the factors and assumptions used to measure our defined benefit plan obligations, actual investment returns on pension assets and other factors could have a negative impact on our financial condition or liquidity. We have certain defined benefit pension plans and other post-employment benefit (“OPEB”) plans.
RISK FACTORS (continued) Significant changes in the factors and assumptions used to measure our defined benefit plan obligations, actual investment returns on pension assets and other factors could have a negative impact on our financial condition or liquidity. We have certain defined benefit pension plans and other post-employment benefit (“OPEB”) plans.
At least annually, we assess our goodwill and intangible assets for impairment. When we utilize a discounted cash flow methodology to calculate the fair value of our reporting units, weak demand for a specific product line or business could result Table of Contents -16- ITEM 1A. RISK FACTORS (continued) in an impairment.
At least annually, we assess our goodwill and intangible assets for impairment. When we utilize a discounted cash flow methodology to calculate the fair value of our reporting units, weak demand for a specific product line or business could result in an impairment. 16 Table of Contents ITEM 1A.
The payment of any future cash dividends to our stockholders is not guaranteed and will depend on decisions that will be made by our Board of Directors and will depend on then-existing conditions, including our operating results, financial conditions, contractual restrictions, corporate law restrictions, capital agreements, applicable laws of the State of Delaware and business prospects.
The payment of any future cash dividends to our stockholders is not guaranteed and will depend on decisions that will be made by our Board of Directors and will depend on then-existing conditions, including our operating results, financial conditions, contractual restrictions, corporate law restrictions, capital agreements, applicable laws of the State of Delaware and business prospects. 18 Table of Contents ITEM 1B.
RISK FACTORS (continued) Proposed or future laws or regulations aimed at addressing climate change, including, but not limited to, local building codes, Environmental Protection Agency regulations on greenhouse gas emissions ( “ GHG ”) , laws or regulations impacting energy supply, and other laws or regulations, may materially impact demand for our products or our cost of doing business.
ITEM 1A. RISK FACTORS (continued) Proposed or future laws or regulations aimed at addressing climate change, including, but not limited to, local building codes, Environmental Protection Agency regulations on greenhouse gas emissions ( “ GHG ”) , laws or regulations impacting energy supply, and climate-related disclosure requirements, may materially impact demand for our products or our cost of doing business.
Compliance with foreign, federal, state and local legislation and regulations concerning climate-related disclosures, including compliance with the European Commission’s Corporate Sustainability Reporting Directive and the SEC’s proposed climate disclosure requirements, may result in additional costs and capital expenditures, and the failure to comply with such legislation and regulations could result in fines to us and could affect our business, financial condition, results of operations and cash flows.
Compliance with foreign, federal, state and local legislation and regulations concerning climate-related disclosures, including compliance with the European Commission’s Corporate Sustainability Reporting Directive and climate disclosure requirements that may be implemented by the SEC, may result in additional costs and capital expenditures, and the failure to comply with such legislation and regulations could result in fines to us and could affect our business, financial condition, results of operations and cash flows.
Table of Contents -18- ITEM 1A. RISK FACTORS (continued) Dividend payments on our common stock are not guaranteed and are declared at the discretion of our Board of Directors. Since February 2014, our Board of Directors has declared a quarterly dividend on our common stock.
Dividend payments on our common stock are not guaranteed and are declared at the discretion of our Board of Directors. Since February 2014, our Board of Directors has declared a quarterly dividend on our common stock.
If any significant judgment or claim is not fully insured or indemnified against, it could have a material adverse impact on our business, financial condition and results of operations. FINANCIAL RISKS Our level of indebtedness could adversely impact our business, financial condition or results of operations. At December 31, 2023, we had total debt of approximately $3.0 billion.
If any significant judgment or claim is not fully insured or indemnified against, it could have a material adverse impact on our business, financial condition and results of operations. FINANCIAL RISKS Our level of indebtedness could adversely impact our business, financial condition or results of operations.
If our cash flows and capital resources are insufficient to fund our pension or OPEB obligations, we could be forced to reduce or delay investments and capital expenditures, seek additional capital, or restructure or refinance our indebtedness.
If our cash flows and capital resources are insufficient to fund our pension or OPEB obligations, we could be forced to reduce or delay investments and capital expenditures, seek additional capital, or restructure or refinance our indebtedness. RISKS RELATED TO OWNERSHIP OF OUR COMMON STOCK The market price of our common stock is subject to volatility.
The major debt rating agencies routinely evaluate our debt based on a number of factors, which include financial strength and business risk as well as transparency with rating agencies and timeliness of financial reporting. A downgrade in our debt rating could result in increased interest on our existing variable Table of Contents -15- ITEM 1A.
The major debt rating agencies routinely evaluate our debt based on a number of factors, which include financial strength and business risk as well as transparency with rating agencies and timeliness of financial reporting.
Accordingly, any determination requiring the write-off of a significant portion of goodwill or intangible assets could negatively impact our results of operations.
Additional adjustments may be recorded to the fair value of goodwill and intangible assets during the measurement period, a period not to exceed 12 months from the acquisition date. Accordingly, any determination requiring the write-off of a significant portion of goodwill or intangible assets could negatively impact our results of operations.
RISK FACTORS (continued) interest rate debt, increased interest and other expenses for future borrowings, and reduced ability for our suppliers to utilize supply chain financing programs. Downgrades in our debt rating could also restrict our access to capital markets and affect the value and marketability of our outstanding senior notes.
A downgrade in our debt rating could result in increased interest on our existing variable interest rate debt, increased interest and other expenses for future borrowings, and reduced ability for our suppliers to utilize supply chain financing programs.
We believe it is likely that the scientific and political attention to issues concerning the extent and causes of climate change will continue, with new and more restrictive laws and regulations focusing on environmental, social and governance (“ESG”) initiatives that could affect our financial condition, results of operations and cash flows.
We believe that ongoing scientific and political focus on climate change may lead to new and more restrictive environmental laws and regulations in certain jurisdictions, which may impact our financial condition, results of operations, and cash flows.
Removed
On February 8, 2024, we entered into a definitive agreement to acquire Masonite International Corporation ("Masonite"), subject to the satisfaction or waiver of specified conditions.
Added
In addition, judicial decisions or executive actions limiting the authority of regulatory agencies, or decisions impacting current regulations and policies implemented by such agencies, could create uncertainty regarding the regulatory landscape and impact the Company’s ability to plan for future investments.
Removed
We expect to incur approximately $3.0 billion of debt to pay a substantial portion of the purchase price for the acquisition of Masonite, as well as assume up to $875 million of Masonite’s senior unsecured notes.
Added
In connection with our acquisition of Masonite, we significantly increased our outstanding indebtedness, including the issuance of $2.0 billion of senior notes. At December 31, 2024, we had total debt of approximately $5.1 billion. As a result, our debt service obligations for 2025 and beyond have increased from prior amounts.
Removed
Increased regulatory requirements for our operations could lead to additional or higher fixed costs in the future.
Added
Downgrades in our debt rating could also restrict our access to capital markets and affect the value and marketability of our outstanding senior notes. 15 Table of Contents ITEM 1A. RISK FACTORS (continued) Our operations require substantial capital, leading to high levels of fixed costs that will be incurred regardless of our level of business activity.
Removed
RISKS RELATED TO OUR PLANNED ACQUISITION OF MASONITE Our planned acquisition of Masonite may not occur at all or may not occur in the expected time frame, which may negatively affect the trading prices of our stock and our future business and financial results.
Added
RISK FACTORS (continued) As a result of the acquisition of Masonite in 2024, we acquired $1.5 billion in goodwill and $1.4 billion in intangible assets. The Company has not yet finalized the valuation of these acquired assets as of December 31, 2024.
Removed
Completion of the planned acquisition of Masonite is subject to the satisfaction or waiver of customary and other closing conditions. The acquisition is not assured and is subject to risks and uncertainties, including the risk that the necessary regulatory approvals or shareholder approval will not be obtained or that other closing conditions will not be satisfied.
Added
We may incur rationalization costs and there can be no assurance that our efforts to reduce costs will be successful. We continually review our manufacturing operations to address market conditions and have reorganized portions of our operations from time to time.
Removed
We cannot predict whether and when such approvals will be received, or such conditions will be satisfied. Table of Contents -17- ITEM 1A. RISK FACTORS (continued) Our obligation to complete the planned acquisition of Masonite is not subject to a financing condition. Our obligation to complete the planned acquisition of Masonite is not subject to a financing condition.
Added
We expect to continue to implement initiatives necessary or desirable to improve our business portfolio, address underperforming assets, improve our cost structure, and generate additional cash. The optimization of our manufacturing operations and cost savings programs involve substantial planning and may require additional capital investment, consolidation, integration and upgrading of facilities, functions and systems.
Removed
We have obtained committed financing for $3.0 billion to pay a substantial portion of the purchase price for the acquisition of Masonite.
Added
These actions could result in a decrease in our short-term earnings as a result of restructuring charges and related impairments and other expenses, including severance costs.
Removed
If any of the banks in the committed financing facility are unable to perform their commitments, we may be required to finance a portion of the purchase price of the planned acquisition at interest rates higher than currently expected. We may not realize the growth opportunities and cost synergies that are anticipated from the planned acquisition of Masonite.
Added
While we expect these initiatives to result in profit opportunities and savings throughout our organization, our estimated profits and savings are based on assumptions that may prove to be inaccurate, and as a result, there can be no assurance that we will realize profits and cost savings or that, if realized, these profits and cost savings will be sustained.
Removed
The benefits that are expected to result from the planned acquisition of Masonite will depend, in part, on our ability to realize the anticipated growth opportunities and cost synergies as a result of the planned acquisition. Our success in realizing these growth opportunities and cost synergies, and the timing of this realization, depends on the successful integration of Masonite.
Added
Failure to achieve or delays in achieving projected levels of efficiencies and cost savings from such measures, or unanticipated inefficiencies resulting from in-process or contemplated manufacturing and administrative reorganization actions, could adversely affect our business, financial condition, results of operations and cash flows. 17 Table of Contents ITEM 1A.
Removed
There can be no assurance that we will successfully or cost-effectively integrate Masonite. The failure to do so could have a material adverse effect on our business, financial condition, and results of operations.
Removed
Even if we are able to integrate Masonite successfully, this integration may not result in the realization of the full benefits of the growth opportunities and cost synergies that we currently expect from this integration, and we cannot guarantee that these benefits will be achieved within anticipated time frames or at all.
Removed
For example, we may not be able to eliminate duplicative costs. Additionally, we may incur substantial expenses in connection with the integration of Masonite. While it is anticipated that certain expenses will be incurred to achieve cost synergies, such expenses are difficult to estimate accurately, and may exceed current estimates.
Removed
Accordingly, the benefits from the planned acquisition may be offset by costs incurred to, or delays in, integrating the businesses. RISKS RELATED TO OWNERSHIP OF OUR COMMON STOCK The market price of our common stock is subject to volatility.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

10 edited+2 added−0 removed6 unchanged
Biggest changeOur Global Information Services team is regularly engaged in cybersecurity training and awareness and incorporates relevant reviews in technology design and development. Table of Contents -20- ITEM 1C. CYBERSECURITY (continued) Our CIO has 19 years of experience in the information technology industry, including engagement with cybersecurity strategy and oversight. Our CIO reports directly to our Chief Executive Officer.
Biggest changeThese regular reports inform our CIO and Vice President, Global Information Security as they monitor the prevention, detection, mitigation, and remediation of cybersecurity incidents under the oversight of the risk committee. Our Global Information Services team is regularly engaged in cybersecurity training and awareness and incorporates relevant reviews in technology design and development.
We also assess, identify, and manage cyber risk associated with divestiture and merger and acquisition activities. The oversight of our cybersecurity risk management process is integrated into our overall risk management process. The risk committee is responsible for overseeing and monitoring our risk assessment and mitigation-related actions, including with respect to cybersecurity risks.
We also assess, identify, and manage cybersecurity risk associated with divestiture and merger and acquisition activities. The oversight of our cybersecurity risk management process is integrated into our overall risk management process. The risk committee is responsible for overseeing and monitoring our risk assessment and mitigation-related actions, including with respect to cybersecurity risks.
We have cloud security tools and governance processes designed to assess, identify and manage material risks from cybersecurity threats. In addition, we maintain an information security training program designed to address phishing and email security, password security, data handling security, cloud security, operational technology security processes, and cyber-incident response and reporting processes.
We have cloud security and other tools and governance processes designed to assess, identify and manage material risks from cybersecurity threats. In addition, we maintain an information security training program designed to address phishing and email security, password security, data handling security, cloud security, operational technology security processes, and cybersecurity incident response and reporting processes.
The Audit Committee review our comprehensive cybersecurity framework, including reviewing our cybersecurity reporting protocol that provides for the notification, escalation and communication of significant cybersecurity events to a crisis management team and appropriate levels of management, including our CIO, as well as to the Audit Committee.
The Audit Committee reviews our comprehensive cybersecurity framework, including reviewing our cybersecurity reporting protocol that provides for the notification, escalation and communication of significant cybersecurity events to a crisis management team and appropriate levels of management, including our CIO, as well as to the Audit Committee.
Any breach of our security measures, or those of our third-party service providers, could result in unauthorized access to and misappropriation of our information, corruption of data or disruption of systems, operations or transactions, any of which could have a material adverse effect on our business strategy, results of operations or financial condition.
Any breach of our security measures, or those of our third-party service providers, could result in unauthorized access to and misappropriation of our information, corruption of data or disruption of systems, operations or transactions, any of which could have a material adverse effect on our business strategy, results of operations or financial condition. See Item 1A.
See “Risk Factors” on page 9 of this Form 10-K for further discussion of the risks related to cybersecurity threats. Governance The Board of Directors is responsible for overseeing risk for the Company and has delegated to the Audit Committee responsibility for overseeing the cybersecurity risk management strategy for the Company.
Risk Factors of this Annual Report on Form 10-K for further discussion of the risks related to cybersecurity threats. Governance The Board of Directors is responsible for overseeing risk for the Company and has delegated to the Audit Committee responsibility for overseeing the cybersecurity risk management strategy for the Company.
Although we experience cybersecurity incidents from time to time as part of our operations, we have not experienced any information security breach that had, or is reasonably likely to have, a material impact on our business strategy, results of operations or financial condition.
Although we experience cybersecurity incidents from time to time as part of our operations, we have not identified any risks from cybersecurity threats, including as a result of previous cybersecurity incidents, that have had or are reasonably likely to have, a material impact on our business strategy, results of operations or financial condition.
Our Vice President, Global Information Security, is primarily responsible for assessing and managing material risks from cybersecurity threats, including monitoring the measures used for prevention, detection, mitigation and remediation of cybersecurity incidents. The information security organization is comprised of internal Owens Corning employees and external security suppliers who provide security monitoring and response.
CYBERSECURITY (continued) The Company’s cybersecurity program is overseen by our CIO, who is responsible for global information technology, including cybersecurity. Our Vice President, Global Information Security, is primarily responsible for assessing and managing material risks from cybersecurity threats, including monitoring the measures used for prevention, detection, mitigation and remediation of cybersecurity incidents.
Management also provides the Audit Committee with a cybersecurity dashboard, which the full Board of Directors can access as well. Additionally, the Audit Committee regularly provides updates to the Board on the status of the Company’s cybersecurity risk management process. The Company’s cybersecurity program is overseen by our CIO, who is responsible for global information technology, including cybersecurity.
Management also provides the Audit Committee with a cybersecurity dashboard, which the full Board of Directors can access as well. Additionally, the Audit Committee regularly provides updates to the Board on the status of the Company’s cybersecurity risk management process. 19 ITEM 1C.
Our Vice President, Global Information Security has 27 years of experience in the cybersecurity industry, including previous experience in the U.S. Air Force, consulting, and 21 years with Owens Corning, and reports directly to our CIO. Table of Contents -21-
Our CIO has 20 years of experience in the information technology industry, including engagement with cybersecurity strategy and oversight. Our CIO reports directly to our Chief Executive Officer. Our Vice President, Global Information Security has 28 years of experience in the cybersecurity industry, including previous experience in the U.S.
Added
Our CIO is responsible for our information security organization, which is comprised of internal Owens Corning employees and external security suppliers. Our information security organization provides security monitoring and response and provides regular reports to our CIO and Vice President, Global Information Security.
Added
Air Force, consulting, and 22 years with Owens Corning, and reports directly to our CIO.

Item 2. Properties

Properties — owned and leased real estate

2 edited+2 added−5 removed0 unchanged
Biggest changeOur research and development activities are primarily conducted at our Science and Technology Center, located on approximately 500 acres of land owned by the Company outside of Granville, Ohio. It consists of approximately 20 structures totaling more than 650,000 square feet. In addition, we have application development and other product and market focused research and development centers in various locations.
Biggest changeIt consists of approximately 20 structures totaling more than 650,000 square feet. In addition, we have application development and other product and market focused research and development centers in various locations. As of December 31, 2024, we operated in 152 manufacturing facilities, of which 110 were owned.
The capacity of each plant varies depending upon product mix. Our principal executive offices are located at the Owens Corning World Headquarters in Toledo, Ohio, an owned facility of approximately 400,000 square feet.
ITEM 2. PROPERTIES Our principal executive offices are located at the Owens Corning World Headquarters in Toledo, Ohio, an owned facility of approximately 400,000 square feet. Our research and development activities are primarily conducted at our Science and Technology Center, located on approximately 500 acres of land owned by the Company outside of Granville, Ohio.
Removed
ITEM 2. PROPERTIES Roofing Our Roofing segment operates out of 33 manufacturing facilities. This number separately counts multiple roofing and asphalt manufacturing facilities that are located at the same site. In connection with our exit of the Protective Packaging business, the Company has ceased operations at the Qingdao, China facility.
Added
The following table summarizes manufacturing facilities by reportable segment and geographical region: Roofing Insulation Doors Composites Total United States 29 20 34 11 94 Europe — 8 7 7 22 Asia-Pacific 1 7 1 4 13 Rest of world 3 5 10 5 23 Total manufacturing facilities 33 40 52 27 152 The capacity of each plant varies depending upon product mix.
Removed
Principal manufacturing facilities for our Roofing segment, all of which are owned by the Company, include the following: Brookville, Indiana Minneapolis, Minnesota Denver, Colorado Portland, Oregon Irving, Texas Savannah, Georgia Kearny, New Jersey Silvassa, India Medina, Ohio Summit, Illinois Memphis, Tennessee Insulation Our Insulation segment operates out of 41 manufacturing facilities.
Added
We believe that these properties are in good condition and well maintained, and are suitable and adequate to carry on our business.
Removed
The Company ceased operations at the Wabash, Indiana facility in the fourth quarter of 2023.
Removed
Principal manufacturing facilities for our Insulation segment, all of which are owned by the Company, include the following: Delmar, New York Rockford, Illinois Edmonton, Alberta, Canada Sedalia, Missouri Fairburn, Georgia Tallmadge, Ohio Guangzhou, Guandong, China Tessenderlo, Belgium Hällekis, Sweden Toronto, Ontario, Canada Joplin, Missouri Trzemeszno, Poland Kansas City, Kansas Vilnius, Lithuania Mexico City, Mexico Waxahachie, Texas Newark, Ohio Composites Our Composites segment operates out of 29 manufacturing facilities.
Removed
Principal manufacturing facilities for our Composites segment, all of which are owned by the Company, include the following: Aiken, South Carolina Hangzhou, China Amarillo, Texas Jackson, Tennessee Anderson, South Carolina Kimchon, Korea Apeldoorn, The Netherlands L’Ardoise, France Danville, Illinois Rio Claro, Brazil Fort Smith, Arkansas Taloja, India Gastonia, North Carolina Tlaxcala, Mexico We believe that these properties are in good condition and well maintained, and are suitable and adequate to carry on our business.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

7 edited+1 added−2 removed0 unchanged
Biggest changeMéndez-Andino (50) Executive Vice President, Chief Research and Development Officer since April 2021; formerly Vice President of Science and Technology for Insulation and Roofing (2019); formerly Vice President of Science and Technology for Insulation (2015) Paula J.
Biggest changeMéndez-Andino (51) Executive Vice President, Chief Research and Development Officer since April 2021; formerly Vice President of Science and Technology for Insulation and Roofing (2019) Paula J. Russell (47) Executive Vice President, Chief Human Resources Officer since January 2021; formerly Senior Vice President, Chief Human Resources Officer (December 2019); formerly Vice President, Chief Human Resources Officer (April 2019) Gunner S.
Beredo (49) Executive Vice President, General Counsel and Corporate Secretary since June 2021; formerly Executive Vice President, General Counsel and Corporate Secretary of Nordson Corporation (a precision technology manufacturing company) (NASDAQ: NDSN) (2018) Brian D.
Beredo (50) Executive Vice President, General Counsel and Corporate Secretary since June 2021; formerly Executive Vice President, General Counsel and Corporate Secretary of Nordson Corporation (a precision technology manufacturing company) (NASDAQ: NDSN) (2018) Brian D.
Smith (50) President, Roofing since August 2018 * Information in parentheses indicates year during the past five years in which service in position began. The last item listed for each individual represents the position held by such individual at the beginning of the five-year period. Table of Contents -24- Part II
Smith (51) President, Roofing since August 2018 * Information in parentheses indicates year during the past five years in which service in position began. The last item listed for each individual represents the position held by such individual at the beginning of the five-year period. 21 Table of Contents Part II
Chambers (57) Board Chair, President and Chief Executive Officer since April 2020; formerly President and Chief Executive Officer (2019); formerly President and Chief Operating Officer (2018) Nicolas Del Monaco (46) President, Insulation since September 2023; formerly Senior Vice President and Managing Director, Europe (2021); formerly Vice President for Non-Wovens and Glass Reinforcements Europe (2018) Mari K.
Chambers (58) Board Chair, President and Chief Executive Officer since April 2020; formerly President and Chief Executive Officer (2019) Nicolas Del Monaco (47) President, Insulation since September 2023; formerly Senior Vice President and Managing Director, Europe (2021); formerly Vice President for Non-Wovens and Glass Reinforcements Europe (2018) Mari K.
ITEM 4. MINE SAFETY DISCLOSURES Not applicable. Table of Contents -23- INFORMATION ABOUT OUR EXECUTIVE OFFICERS The name, age and business experience during the past five years of Owens Corning’s executive officers as of January 1, 2024 are set forth below.
ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 20 Table of Contents INFORMATION ABOUT OUR EXECUTIVE OFFICERS The name, age and business experience during the past five years of Owens Corning’s executive officers are set forth below. Each executive officer holds office until his or her successor is elected and qualified or until his or her earlier resignation, retirement or removal.
Fister (49) Executive Vice President and Chief Financial Officer since September 2023; formerly President, Insulation (2019); formerly Vice President of Global Insulation and Strategy (2019); formerly Vice President and Managing Director for Europe Insulation and Global Foamglas® (2018) José L.
Doerfler (42) Vice President and Controller since April 2023; formerly Assistant Controller (2021); formerly Americas Accounting Director (2019) Todd W. Fister (50) Executive Vice President and Chief Financial Officer since September 2023; formerly President, Insulation (2019); formerly Vice President of Global Insulation and Strategy (2019) José L.
Each executive officer holds office until his or her successor is elected and qualified or until his or her earlier resignation, retirement or removal. All of the listed executive officers have been employees of Owens Corning during the past five years except as indicated below. Name and Age Position* Gina A.
All of the listed executive officers have been employees of Owens Corning during the past five years except as indicated below.
Removed
Doerfler (41) Vice President and Controller since April 2023; formerly Assistant Controller (2021); formerly Americas Accounting Director (2019); formerly Global Internal Controls Leader (2016) Todd W.
Added
Name and Age Position* Christopher Ball (47) President, Doors since May 2024; formerly President of the Global Residential Door Business, Masonite (a door manufacturer to the residential construction industry) (formerly NYSE: DOOR) (2021); formerly President - Americas, Cooper Tire & Rubber Company (a tire manufacturing company) (formerly NYSE: CTB) (2018) Gina A.
Removed
Russell (46) Executive Vice President, Chief Human Resources Officer since January 2021; formerly Senior Vice President, Chief Human Resources Officer (December 2019); formerly Vice President, Chief Human Resources Officer (April 2019); formerly Vice President of Total Rewards and Center of Excellence (2018) Marcio A. Sandri (60) President, Composites since May 2018 Gunner S.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

7 edited+1 added−0 removed5 unchanged
Biggest changeIssuer Purchases of Equity Securities The following table provides information about Owens Corning’s purchases of its common stock during the three months ended December 31, 2023: Period Total Number of Shares (or Units) Purchased* Average Price Paid per Share (or Unit) Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs** Maximum Number of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs** October 1-31, 2023 1,001 $ 132.31 — 10,767,634 November 1-30, 2023 1,492,377 129.00 1,485,065 9,282,569 December 1-31, 2023 344,062 143.08 337,367 8,945,202 Total 1,837,440 $ 131.64 1,822,432 8,945,202 * The Company retained 15,008 shares surrendered to satisfy tax withholding obligations in connection with the vesting of restricted stock units granted to our employees. ** The Board of Directors approved two share repurchase programs in 2022 under which the Company is authorized to repurchase up to an aggregate of 20 million shares of the Company's outstanding common stock (the “Repurchase Authorization”).
Biggest changeIssuer Purchases of Equity Securities The following table provides information about Owens Corning’s purchases of its common stock during the three months ended December 31, 2024: Period Total Number of Shares (or Units) Purchased* Average Price Paid per Share (or Unit) Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs** Maximum Number of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs** October 1-31, 2024 6,190 $ 178.52 — 6,863,687 November 1-30, 2024 425,787 194.78 422,211 6,441,476 December 1-31, 2024 91,551 198.59 89,370 6,352,106 Total 523,528 $ 195.25 511,581 * The Company retained 11,947 shares surrendered to satisfy tax withholding obligations in connection with the vesting of restricted stock units granted to our employees. ** On December 1, 2022, the Board of Directors approved a new share repurchase program under which the Company is authorized to repurchase up to an aggregate of 10 million shares of the Company's outstanding common stock (the “Repurchase Authorization”).
Smith Corporation; Advance Drainage Systems, Inc.; Allegion plc; Armstrong World Industries, Inc.; Ball Corporation; Builders FirstSource, Inc.; Carlisle Companies Incorporated; Carrier Global Corporation; Celanese Corporation; Eastman Chemical Company; Fortune Brands Innovations, Inc.; Greif, Inc.; JELD-WEN Holding, Inc.; Johnson Controls International plc; Lennox International Inc.; Louisiana-Pacific Corporation; Masco Corporation; Masonite International Corporation; Mohawk Industries, Inc.; O-I Glass, Inc.; PPG Industries, Inc.; Resideo Technologies, Inc.; RPM International Inc.; Stanley Black & Decker, Inc.; The Sherwin-Williams Company; Trane Technologies; Trex Company, Inc.; and UFP Industries, Inc.
Smith Corporation; Advance Drainage Systems, Inc.; Allegion plc; Armstrong World Industries, Inc.; Ball Corporation; Builders FirstSource, Inc.; Carlisle Companies Incorporated; Carrier Global Corporation; Celanese Corporation; Eastman Chemical Company; Fortune Brands Innovations, Inc.; Greif, Inc.; JELD-WEN Holding, Inc.; Johnson Controls International plc; Lennox International Inc.; Louisiana-Pacific Corporation; Masco Corporation; Mohawk Industries, Inc.; O-I Glass, Inc.; PPG Industries, Inc.; Resideo Technologies, Inc.; RPM International Inc.; Stanley Black & Decker, Inc.; The Sherwin-Williams Company; Trane Technologies; Trex Company, Inc.; and UFP Industries, Inc.
The total cumulative dollar returns shown on the graph represent the value that such investments would have had on December 31, 2023. We chose to use a self-selected peer group consisting of the companies noted below to include in the performance graph as we believe this peer group aligns with our specific industry, markets, and global exposure.
The total cumulative dollar returns shown on the graph represent the value that such investments would have had on December 31, 2024. We chose to use a self-selected peer group consisting of the companies noted below to include in the performance graph as we believe this peer group aligns with our specific industry, markets and global exposure.
MARKET FOR OWENS CORNING’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES (continued) Performance Graph The annual changes for the five-year period shown in the graph on this page are based on the assumption that $100 had been invested in Owens Corning (OC) stock, the Standard & Poor’s 500 Stock Index (“S&P 500”), and a peer group index on December 31, 2018, and that all quarterly dividends were reinvested.
MARKET FOR OWENS CORNING’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES (continued) Performance Graph The annual changes for the five-year period shown in the graph below are based on the assumption that $100 had been invested in Owens Corning (OC) stock, the Standard & Poor’s 500 Stock Index (“S&P 500”), and a peer group index on December 31, 2019, and that all quarterly dividends were reinvested.
ITEM 5. MARKET FOR OWENS CORNING’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Owens Corning’s common stock trades on the New York Stock Exchange under the symbol “OC.” Holders of Common Stock The number of stockholders of record of Owens Corning’s common stock on February 9, 2024 was 55.
ITEM 5. MARKET FOR OWENS CORNING’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Owens Corning’s common stock trades on the New York Stock Exchange under the symbol “OC.” Holders of Common Stock The number of stockholders of record of Owens Corning’s common stock on February 20, 2025 was 55.
The Company repurchased 1.8 million shares of its common stock for $238 million, inclusive of applicable taxes, during the three months ended December 31, 2023 under the Repurchase Authorization. As of December 31, 2023, 8.9 million shares remain available for repurchase under the Repurchase Authorization. Table of Contents -25- ITEM 5.
The Company repurchased 0.5 million shares of its common stock for $101 million, inclusive of applicable taxes, during the three months ended December 31, 2024 under the Repurchase Authorization. As of December 31, 2024, 6.4 million shares remain available for repurchase under the Repurchase Authorization. 22 Table of Contents ITEM 5.
Performance Graph 2018 2019 2020 2021 2022 2023 OC $ 100 $ 151 $ 178 $ 215 $ 206 $ 365 S&P 500 $ 100 $ 131 $ 156 $ 200 $ 164 $ 207 Peer Group $ 100 $ 140 $ 171 $ 235 $ 166 $ 222 The peer group index is comprised of the following companies: A.O.
Performance Graph 2019 2020 2021 2022 2023 2024 OC $ 100 $ 118 $ 143 $ 137 $ 242 $ 283 S&P 500 $ 100 $ 118 $ 152 $ 125 $ 158 $ 197 Peer Group $ 100 $ 122 $ 167 $ 118 $ 159 $ 175 The peer group index is comprised of the following companies: A.O.
Added
With the acquisition of Masonite, Masonite International Corporation has been removed from the peer group index for all years presented.

Item 6. [Reserved]

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

22 edited+22 added−20 removed1 unchanged
Biggest changeThe following table presents the impact and respective location of total restructuring, acquisition and divestiture-related costs on the Consolidated Statements of Earnings (in millions): Twelve Months Ended December 31, Location 2023 2022 2021 Restructuring costs Cost of sales $ (102) $ (42) $ (14) Restructuring costs Marketing and administrative expenses (2) — (2) Severance Other expense (income), net (34) (1) (11) Other exit costs Other expense (income), net (31) (5) (5) Gain on sale of land in India Other expense (income), net — — 15 Restructuring costs Non-operating (income) expense — — (2) Recognition of acquisition inventory fair value step-up Cost of sales — — (1) Acquisition and divestiture-related costs Marketing and administrative expenses — (7) — Gain on sale of Santa Clara, California site Gain on sale of site 189 — — Gain on sale of Shanghai, China facility Other expense (income), net — 27 — Loss on sale of Chambery, France DUCS business Other expense (income), net — (30) — Gain on remeasurement of Fiberteq equity investment Gain on equity method investment — 130 — Loss on sale of Russian operations Other expense (income), net — (33) — Total restructuring, acquisition and divestiture-related gains (costs) $ 20 $ 39 $ (20) Table of Contents -31-
Biggest changeThe following table presents the impact and respective location of these income (expense) items on the Consolidated Statements of Earnings: Twelve Months Ended December 31, (In millions) Location 2024 2023 Restructuring costs Cost of sales $ (21) $ (102) Restructuring costs Marketing and administrative expenses (2) (2) Severance Other expense, net (63) (34) Other exit costs Other expense, net — (31) Acquisition-related integration costs Other expense, net (83) — Acquisition-related transaction costs Other expense, net (49) — Loss on sale of business Loss on sale of business (91) — Gain on sale of Santa Clara, California site Gain on sale of site — 189 Total restructuring, acquisition and divestiture-related (costs) gains $ (309) $ 20 27 Table of Contents
MD&A is provided as a supplement to, and should be read in conjunction with, our Consolidated Financial Statements and the accompanying Notes thereto contained in this report. Unless the context requires otherwise, the terms “Owens Corning,” “Company,” “we,” “its,” and “our” in this Annual Report on Form 10-K refer to Owens Corning and its subsidiaries.
MD&A is provided as a supplement to, and should be read in conjunction with, our Consolidated Financial Statements and the accompanying Notes thereto contained in this Annual Report on Form 10-K. Unless the context requires otherwise, the terms “Owens Corning,” “Company,” “we,” “its,” and “our” in this Annual Report on Form 10-K refer to Owens Corning and its subsidiaries.
Discussions of 2021 items and year-to-year comparisons between 2022 and 2021 that are not included in this Form 10-K can be found in “Management's Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2022.
Discussions of 2022 items and year-to-year comparisons between 2023 and 2022 that are not included in this Form 10-K can be found in “Management's Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2023.
ITEM 6. RESERVED Table of Contents -26- ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS This Management’s Discussion and Analysis ( “ MD&A ” ) is intended to help investors understand Owens Corning, our operations and our present business environment.
ITEM 6. RESERVED 23 Table of Contents ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS This Management’s Discussion and Analysis ( “ MD&A ” ) is intended to help investors understand Owens Corning, our operations and our present business environment.
This section of this Annual Report on Form 10-K generally discusses 2023 and 2022 items and year-to-year comparisons between 2023 and 2022.
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.
Paroc voluntarily withdrew these specific products from the market, issued recalls, and suspended distribution and sales of these products. Paroc continues to cooperate with the applicable regulatory and government authorities and work with its customers and end-users to assist with remediation.
Paroc voluntarily withdrew these specific products from the market, issued recalls and suspended distribution and sales of these products (the “Recalled Products”). Paroc continues to cooperate with the applicable regulatory and government authorities and work with its customers and end-users to assist with remediation for the recall.
GAIN ON SALE OF SITE In the first quarter of 2023, the Company finalized the sale of the Company's Insulation site in Santa Clara, California resulting in the recognition of a pre-tax gain of $189 million. Table of Contents -29- ITEM 7.
GAIN ON SALE OF SITE In 2023, the Company finalized the sale of the Company's Insulation site in Santa Clara, California resulting in the recognition of a pre-tax gain of $189 million. 26 Table of Contents ITEM 7.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) During the second quarter of 2023, the Company’s subsidiary, Paroc Group OY (“Paroc”), which the Company acquired in 2018, notified the appropriate European maritime regulatory authorities that specific products in its marine insulation product line may not meet certain fire safety requirements in accordance with their certifications.
Paroc Recall During the second quarter of 2023, the Company’s subsidiary, Paroc Group OY (“Paroc”), which the Company acquired in 2018, notified the appropriate European maritime regulatory authorities that specific products in its marine insulation product line may not meet certain fire safety requirements in accordance with their certifications.
GENERAL Owens Corning is a global building and construction materials leader committed to building a sustainable future through material innovation. The Company has three reporting segments: Roofing, Insulation and Composites. Through these lines of business, the Company manufactures and sells products worldwide. We are a market leader in many of our major product categories.
GENERAL Owens Corning is a residential and commercial building products leader committed to building a sustainable future through material innovation. The Company has four reportable segments: Roofing, Insulation, Doors and Composites. Through these lines of business, the Company manufactures and sells products worldwide. We are a market leader in many of our major product categories.
The Company’s effective tax rate for 2023 was 25% on pre-tax income of $1,591 million. The difference between the 25% effective tax rate and the U.S. federal statutory tax rate of 21% is primarily due to U.S. state and local income tax expense. The Company’s effective tax rate for 2022 was 23% on pre-tax income of $1,614 million.
The difference between the 30% effective tax rate and the U.S. federal statutory tax rate of 21% is primarily due to U.S. state and local income tax expense, valuation allowances and uncertain tax positions. The Company’s effective tax rate for 2023 was 25% on pre-tax income of $1,591 million.
EXECUTIVE OVERVIEW Net earnings attributable to Owens Corning were $1,196 million in 2023, compared to $1,241 million in 2022. The Company generated $1,805 million in adjusted earnings before interest and taxes (“Adjusted EBIT”) in 2023 compared to $1,762 million in 2022.
EXECUTIVE OVERVIEW Net earnings attributable to Owens Corning were $647 million in 2024, compared to $1,196 million in 2023. The Company generated $2,038 million in adjusted earnings before interest and taxes (“Adjusted EBIT”) in 2024 compared to $1,805 million in 2023.
The difference between the 23% effective tax rate and the U.S. federal statutory tax rate of 21% is primarily attributable to U.S. state and local income tax expense, adjustments to R&D tax credits, and other adjustments. See Note 20 for additional information. Table of Contents -30- ITEM 7.
The difference between the 25% effective tax rate and the U.S. federal statutory tax rate of 21% is primarily attributable to U.S. state and local income tax expense. See Note 21 for additional information.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) RESULTS OF OPERATIONS Consolidated Results (in millions) Twelve Months Ended December 31, 2023 2022 2021 Net sales $ 9,677 $ 9,761 $ 8,498 Gross margin $ 2,683 $ 2,616 $ 2,217 % of net sales 28 % 27 % 26 % Marketing and administrative expenses $ 831 $ 803 $ 757 Gain on equity method investment $ — $ (130) $ — Gain on sale of site $ (189) $ — $ — Other expense (income), net $ 106 $ 123 $ (69) Non-operating expense (income), net $ 145 $ (9) $ (10) Earnings before interest and taxes $ 1,667 $ 1,723 $ 1,448 Interest expense, net $ 76 $ 109 $ 126 Loss on extinguishment of debt $ — $ — $ 9 Income tax expense $ 401 $ 373 $ 319 Net earnings attributable to Owens Corning $ 1,196 $ 1,241 $ 995 The Consolidated Results discussion below provides a summary of our results and the trends affecting our business, and should be read in conjunction with the more detailed Segment Results discussion that follows.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) RESULTS OF OPERATIONS Consolidated Results Twelve Months Ended December 31, (In millions) 2024 2023 Net sales $ 10,975 $ 9,677 Gross margin $ 3,254 $ 2,683 % of net sales 30 % 28 % Marketing and administrative expenses $ 1,044 $ 831 Loss on sale of business $ 91 $ — Impairment due to strategic review $ 483 $ — Gain on sale of site $ — $ (189) Other expense, net $ 365 $ 106 Non-operating (income) expense, net $ (1) $ 145 Earnings before interest and taxes $ 1,128 $ 1,667 Interest expense, net $ 212 $ 76 Income tax expense $ 275 $ 401 Net earnings attributable to Owens Corning $ 647 $ 1,196 The Consolidated Results discussion below provides a summary of our results and the trends affecting our business, and should be read in conjunction with the more detailed Segment Results discussion that follows.
These costs are recorded within Corporate, Other and Eliminations. Please refer to Note 12 of the Consolidated Financial Statements for further information on the nature of these costs.
Please refer to Note 13 of the Consolidated Financial Statements for further information on the nature of these costs.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) Restructuring, Acquisition and Divestiture-Related Costs The Company has incurred restructuring, transaction and integration costs related to acquisitions and divestitures, along with restructuring and other exit costs in connection with its global cost reduction, product line and productivity initiatives and growth strategy.
Restructuring, Acquisition and Divestiture-Related Costs The Company has incurred restructuring, transaction and integration costs related to acquisitions and divestitures, along with restructuring and other exit costs in connection with our global cost reduction, product line and productivity initiatives and growth strategy. These costs are recorded within Corporate, Other and Eliminations.
NON-OPERATING EXPENSE (INCOME), NET Non-operating expense (income), net increased $154 million in 2023 compared to 2022. The increase was driven by the pension settlement loss in the fourth quarter of 2023. INTEREST EXPENSE, NET Interest expense, net decreased $33 million in 2023 compared to 2022.
NON-OPERATING (INCOME) EXPENSE, NET Non-operating (income) expense, net was income of $1 million in 2024 compared to $145 million of expense in 2023. The decrease is due to the pension settlement loss in the fourth quarter of 2023. INTEREST EXPENSE, NET Interest expense, net increased $136 million in 2024 compared to 2023.
During 2023, the Company established an estimated liability for expected future costs related to the marine recall on our Consolidated Balance Sheet as of December 31, 2023. As part of its review of the Paroc insulation product portfolio, the Company discovered potential nonconformances relating to certain ventilation duct insulation products.
The Company has included an estimated liability for expected future costs related to the Recalled Products on its Consolidated Balance Sheets as of December 31, 2024 and December 31, 2023. Due to these nonconformances, the Company reviewed the Paroc insulation product portfolio. The review has concluded.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) OTHER EXPENSE (INCOME), NET Other expense (income), net decreased $17 million in 2023 compared to 2022.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) OTHER EXPENSE, NET Other expense, net increased $259 million in 2024 compared to 2023. The increase was primarily driven by higher acquisition and strategic review-related costs.
On February 9, 2024, the Company announced the decision to review strategic alternatives for its global glass reinforcements (“GR”) business, consistent with our strategy to focus on building and construction materials. The GR business, which operates within our Composites segment, supplies a wide variety of glass fiber products for applications in wind energy, infrastructure, industrial, transportation, and consumer markets.
The GR business, part of the Company’s Composites segment, manufactures, fabricates, and sells glass fiber reinforcements for a wide variety of applications in wind energy, infrastructure, industrial, transportation and consumer markets. In 2024, the GR business generated annual revenues of approximately $1.1 billion.
MARKETING AND ADMINISTRATIVE EXPENSES Marketing and administrative expenses increased $28 million in 2023 compared to 2022. The increase was driven primarily by ongoing inflationary pressures, as well as higher general corporate expenses.
The increase was primarily driven by the margins from our Doors segment as a result of the Masonite acquisition. Also contributing to the increase were higher selling prices, slightly offset by lower sales volumes. MARKETING AND ADMINISTRATIVE EXPENSES Marketing and administrative expenses increased $213 million in 2024 compared to 2023.
The decrease was driven by higher interest income related to the increase in cash and interest rates, as well as higher capitalized interest resulting from higher construction in progress balances. INCOME TAX EXPENSE Income tax expense for 2023 was $401 million compared to $373 million in 2022.
The increase was driven by higher interest on the 364-Day Credit Facility and higher long-term debt balances in connection with the Masonite acquisition. INCOME TAX EXPENSE Income tax expense for 2024 was $275 million compared to $401 million in 2023. The Company’s effective tax rate for 2024 was 30% on pre-tax income of $916 million.
The remaining variance was driven by favorable customer mix, which was partially offset by the unfavorable net impact of acquisitions and divestitures. GROSS MARGIN Gross margin increased $67 million in 2023 compared to 2022.
NET SALES Net sales increased $1,298 million in 2024 compared to 2023. The increase in net sales was primarily driven by the revenues from our Doors segment as a result of the Masonite acquisition, which was partially offset by lower sales volumes. GROSS MARGIN Gross margin increased $571 million in 2024 compared to 2023.
Removed
Segment earnings before interest and taxes (“EBIT”) performance compared to 2022 increased $343 million in our Roofing segment, increased $7 million in our Insulation segment and decreased $256 million in our Composites segment. Within our Corporate, Other and Eliminations category, General corporate expenses and other increased by $51 million.
Added
Segment earnings before interest and taxes (“EBIT”) performance compared to 2023 increased $124 million in our Roofing segment, increased $63 million in our Insulation segment and decreased $27 million in our Composites segment. The Doors segment contributed revenues of $1,448 million and EBIT of $99 million to the Company for the period from May 15, 2024 to December 31, 2024.
Removed
Cash and cash equivalents were $1.6 billion as of December 31, 2023, compared to $1.1 billion as of December 31, 2022. In 2023, the Company's operating activities provided $1,719 million of cash flow, compared to $1,760 million in 2022. On February 8, 2024, the Company entered into a definitive agreement to purchase all of the outstanding shares of Masonite.
Added
Within our Corporate, Other and Eliminations category, General corporate expenses and other increased by $26 million. Glass Reinforcements Divestiture On February 13, 2025, the Company entered into a definitive agreement for the sale of our global glass reinforcements (“GR”) business for a purchase price of approximately $436 million, less costs to sell.
Removed
The purchase price for the acquisition of Masonite is approximately $3.9 billion in cash, which we expect to fund with cash on hand and new committed financing.
Added
The sale will complete Owens Corning’s review of strategic alternatives for the business, announced on February 9, 2024, and aligns with the strategy to reshape the Company to focus on residential and commercial building products in North America and Europe. During 2024, the Company incurred $46 million of costs related to this review.
Removed
Masonite is a leading global designer, manufacturer, marketer and distributor of interior and exterior doors and door systems for the new construction and repair, renovation and remodeling sectors of the residential and non-residential building construction markets.
Added
The transaction is expected to close in 2025 and is subject to customary regulatory approvals and other conditions. The Company expects to incur a material loss on disposal which cannot be estimated at this time.
Removed
The transaction was unanimously approved by the board of directors of both companies and is expected to close mid-2024, subject to regulatory and other customary closing conditions, including the approval of Masonite shareholders.
Added
The transaction represents a strategic shift that has a major effect on the Company's operations and financial results and therefore, beginning with the quarterly report on Form 10-Q for the period ending March 31, 2025, the GR business’ financial results will be reflected in the Company’s consolidated financial statements as discontinued operations for all periods presented.
Removed
The GR business generates annual revenues of approximately $1.3 billion and has operations in 11 countries, with 18 manufacturing facilities. While a range of options are under consideration, including a potential sale, spin-off or other strategic option, there can be no assurance that the strategic review will result in any transaction or other outcome.
Added
The Company intends to reorganize its operations and reporting structure and begin to manage its operations under three reporting segments. During the fourth quarter of 2024, the Company determined that certain asset groups should be tested for recoverability, primarily as a result of the progression of the strategic review of the GR business.
Removed
In the fourth quarter of 2023, the Company entered into two agreements to purchase non-participating annuity contracts from insurance companies to transfer $291 million of the Company's outstanding pension projected benefit obligations related to certain U.S. and non-U.S. pension plans. These transactions were funded with pension plan assets of $268 million.
Added
The comparison indicated that the GR asset group was not recoverable.
Removed
As a result of these transactions, the Company recognized a pre-tax settlement charge of $145 million in the fourth quarter of 2023 from the accelerated recognition of a pro rata portion of plan actuarial losses. This charge was recorded in Non-operating expense (income), net on the Consolidated Statements of Earnings.
Added
As a result of the analysis performed, the Company recorded pre-tax asset impairment charges for the amount by which the carrying value exceeds its fair value of $483 million for the year ended December 31, 2024, which is included in Impairment due to strategic review on the Consolidated Statements of Earnings.
Removed
These transactions did not have a material effect on the plans' funded statuses. Table of Contents -27- ITEM 7.
Added
These charges include $439 million related to property, plant and equipment, $30 million related to operating lease right-of-use assets and $14 million related to definite-lived intangible assets. 24 Table of Contents ITEM 7.
Removed
In January 2024, Paroc suspended sales of the affected insulation products as a precautionary measure while it reviews the potential nonconformances. The Company is continuing its review. In May 2023, the Company made the decision to exit the Protective Packaging business within the Roofing segment, including the production and sale of wood packaging, metal packaging and custom products.
Added
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) Assets Held for Sale On November 4, 2024, the Company entered into a related party agreement to sell its building materials business in China and Korea to a member of the business’ management team, meeting the assets held for sale criteria.
Removed
Exiting Protective Packaging will allow the Company to focus resources on the growth of its building materials products, which supports the future growth aspirations of the enterprise. With the exit of the Protective Packaging business, the Company closed its plants in Dorval, Quebec and Mission, British Columbia, Canada. The Company also ceased operations at its Qingdao, China facility.
Added
The transaction includes six insulation manufacturing facilities in China and a roofing manufacturing facility in Korea. The building materials business, within the Insulation segment, represents annual revenues of approximately $130 million. The Company reclassified $2 million as held for sale within Other current liabilities on the Consolidated Balance Sheets.
Removed
In connection with the exit of the Protective Packaging business, the Company estimates that it will incur cash charges of approximately $15 million, primarily related to severance and other exit costs.
Added
The Company recorded the assets at the fair value less cost to sell, which was less than the carrying value and resulted in an impairment of $91 million related primarily to Property, Plant and Equipment and Goodwill. The transaction is expected to close mid-2025, and any additional loss on disposal is expected to be immaterial.
Removed
Additionally, the Company expects to incur total non-cash charges in the range of $70 to $75 million, primarily related to accelerated depreciation of property, plant and equipment and accelerated amortization of definite-lived intangibles. The Company has exited the majority of the business and expects to generate savings of approximately $7 million annually beginning 2024.
Added
Masonite Acquisition On May 15, 2024, the Company acquired all of the outstanding shares of Masonite International Corporation (“Masonite”), a leading global designer, manufacturer, marketer and distributor of interior and exterior doors and door systems, for $3.2 billion primarily funded with debt proceeds and cash on hand.
Removed
During the twelve months ended 2023, the Company recorded $78 million of charges, primarily related to accelerated depreciation, accelerated amortization and severance. In March 2023, the Company finalized the sale of its Insulation site in Santa Clara, California for total proceeds of $234 million, net of transaction fees.
Added
The acquisition of Masonite's market-leading doors business creates a new growth platform for the Company, strengthening the Company's position in building and construction and expanding the Company's offering of branded residential building products.
Removed
Total proceeds included a non-refundable deposit of $50 million received in the third quarter 2021. As a result, the Company recognized a pre-tax gain of $189 million in the first quarter of 2023, which is recorded in Gain on sale of site on the Consolidated Statements of Earnings.
Added
Masonite's operating results and preliminary purchase price allocation have been included in the Company's newly established Doors reportable segment from May 15, 2024, within the Consolidated Financial Statements.
Removed
In 2023, the Company repurchased 5.4 million shares of the Company’s common stock for $629 million, inclusive of applicable taxes, under previously announced repurchase authorizations. As of December 31, 2023, 8.9 million shares remained available for repurchase under the repurchase authorizations. Table of Contents -28- ITEM 7.
Added
The Company issued $2.0 billion of senior notes, the proceeds of which were used to repay a portion of the outstanding borrowings under the 364-Day Credit Facility, which was used to fund a portion of the acquisition, and to pay related fees and expenses.
Removed
NET SALES Net sales decreased $84 million in 2023 compared to 2022. The decrease in net sales was driven by lower sales volumes in both Insulation and Composites segments, partially offset by higher selling prices across all three segments.
Added
Refer to Liquidity, Capital Resources and Other Related Matters for further discussions on the current year debt instruments.
Removed
The increase in gross margin was driven by higher selling prices across all three segments, which was partially offset by lower sales volumes in both Insulation and Composites segments and higher production downtime. Favorable delivery and favorable customer and product mix more than offset higher input costs and the unfavorable net impact of acquisitions and divestitures.
Added
In addition to addressing the Recalled Products, the Company continues to assess potential nonconformances related to certain ventilation duct and steel beam insulation products. Paroc suspended sales of these affected insulation products as a precautionary measure while it reviews the potential nonconformances, but has not issued recalls. We expect to incur costs associated with the resolution of this matter.
Removed
GAIN ON EQUITY METHOD INVESTMENT In 2022, the Company recognized a non-cash gain of $130 million from the remeasurement of the previously held equity method investment in Fiberteq, LLC upon the Company’s acquisition of the remaining 50% of the joint venture with IKO.
Added
The amount or range of any potential loss cannot be reasonably estimated at this time. 25 Table of Contents ITEM 7.
Removed
Higher restructuring costs, lower gains on the sale of precious metals and the establishment of the estimated liability for the Paroc marine recall matter in 2023 were more than offset by the favorable comparison year-over-year to indefinite-lived intangible asset impairment charges of $96 million and the net loss from divestiture related activities.
Added
The increase was primarily driven by the addition of the Doors segment selling, general and administrative expenses and ongoing inflationary pressures throughout the organization. LOSS ON SALE OF BUSINESS In 2024, the Company entered into a related party agreement to sell its building materials business in China and Korea.
Added
As a result of classifying the business as held for sale at December 31, 2024, we recorded a loss of $91 million included in Loss on sale of business on the Consolidated Statements of Earnings.
Added
IMPAIRMENT DUE TO STRATEGIC REVIEW As a result of the ongoing strategic review of the glass reinforcements business, in 2024 the Company recorded a $483 million impairment charge included in Impairment due to strategic review on the Consolidated Statements of Earnings, and was included in the Corporate, Other and Eliminations reporting category.

Item 7. Management's Discussion & Analysis

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

76 edited+56 added−22 removed39 unchanged
Biggest changeThese risks, uncertainties and other factors include, without limitation: • levels of residential and commercial or industrial construction activity; • demand for our products; • industry and economic conditions including, but not limited to, supply chain disruptions, recessionary conditions, inflationary pressures, interest rate and financial markets volatility, and the viability of banks and other financial institutions; • availability and cost of energy and raw materials; • levels of global industrial production; • competitive and pricing factors; • relationships with key customers and customer concentration in certain areas; • issues related to acquisitions, divestitures and joint ventures or expansions, including the planned acquisition of Masonite; • climate change, weather conditions and storm activity; • legislation and related regulations or interpretations, in the United States or elsewhere; • domestic and international economic and political conditions, policies or other governmental actions, as well as war and civil disturbance; • changes to tariff, trade or investment policies or laws; • uninsured losses, including those from natural disasters, catastrophes, pandemics, theft or sabotage; • environmental, product-related or other legal and regulatory liabilities, proceedings or actions; • research and development activities and intellectual property protection; • issues involving implementation and protection of information technology systems; • foreign exchange and commodity price fluctuations; • our level of indebtedness; including the planned acquisition of Masonite; • our liquidity and the availability and cost of credit; • our ability to achieve expected synergies, cost reductions and/or productivity improvements; • the level of fixed costs required to run our business; • levels of goodwill or other indefinite-lived intangible assets; • price volatility in certain wind energy markets in the U.S.; • loss of key employees and labor disputes or shortages; • our ability to complete and successfully integrate the Masonite acquisition; • any material adverse changes in the business of Masonite • the ability to obtain required regulatory, shareholder or other third-party approvals and consents and otherwise complete the Masonite acquisition; • our ability to achieve the strategic and other objectives relating to the Masonite acquisition, including any expected synergies, and the strategic review of our GR business; and • defined benefit plan funding obligations.
Biggest changeThese risks, uncertainties and other factors include, without limitation: • levels of residential and commercial or industrial construction activity; • demand for our products; • industry and economic conditions including, but not limited to, supply chain disruptions, recessionary conditions, inflationary pressures and interest rate and financial markets volatility; • changes to tariff, trade or investment policies or laws; • availability and cost of energy and raw materials; • competitive and pricing factors; • relationships with key customers and customer concentration in certain areas; • our ability to achieve expected synergies, cost reductions and/or productivity improvements; • issues related to acquisitions, divestitures and joint ventures or expansions; • our ability to complete the announced divestiture of our GR business on the expected terms and within the anticipated time period, or at all, which is dependent on the parties' ability to satisfy certain closing conditions; • climate change, weather conditions and storm activity; • legislation and related regulations or interpretations, in the United States or elsewhere; • domestic and international economic and political conditions, policies or other governmental actions, as well as war and civil disturbance; • uninsured losses or major manufacturing disruptions, including those from natural disasters, catastrophes, pandemics, theft or sabotage; • environmental, product-related or other legal and regulatory liabilities, proceedings or actions; • research and development activities and intellectual property protection; • issues involving implementation and protection of information technology systems; • foreign exchange and commodity price fluctuations; • our level of indebtedness; • our liquidity and the availability and cost of credit; • the level of fixed costs required to run our business; • levels of goodwill or other indefinite-lived intangible assets; • price volatility in certain wind energy markets in the U.S.; • loss of key employees and labor disputes or shortages; and • defined benefit plan funding obligations.
Accounting for pensions and other postretirement benefits involves estimating the cost of benefits to be provided well into the future and attributing that cost over the time period each employee works. To accomplish this, extensive use is made of assumptions about investment returns, discount rates, inflation, mortality, turnover, and medical costs.
Pensions and Other Postretirement Benefits Accounting for pensions and other postretirement benefits involves estimating the cost of benefits to be provided well into the future and attributing that cost over the time period each employee works. To accomplish this, extensive use is made of assumptions about investment returns, discount rates, inflation, mortality, turnover and medical costs.
Conversely, if we were to determine that we would be able to realize our net deferred tax assets in the future in excess of their currently recorded amount, an adjustment to increase the net deferred tax assets would be credited to earnings in the period such determination was made. Impairment of Assets.
Conversely, if we were to determine that we would be able to realize our net deferred tax assets in the future in excess of their currently recorded amount, an adjustment to increase the net deferred tax assets would be credited to earnings in the period such determination was made.
The Company exercises judgment in evaluating assets for impairment. Goodwill and other indefinite-lived intangible assets are tested for impairment annually, or when circumstances arise which indicate there may be an impairment. Long-lived assets are tested for impairment when economic conditions or management decisions indicate an impairment may exist.
Impairment of Assets The Company exercises judgment in evaluating assets for impairment. Goodwill and other indefinite-lived intangible assets are tested for impairment annually, or when circumstances arise which indicate there may be an impairment. Long-lived assets are tested for impairment when economic conditions or management decisions indicate an impairment may exist.
However, changes in management intentions, market conditions, operating performance and other similar circumstances could affect the assumptions used in these impairment tests. Changes in the assumptions could result in impairment charges that could be material to our Consolidated Financial Statements in any given period.
However, changes in management intentions, market conditions, operating performance and other similar circumstances could affect the assumptions used in these impairment tests. Changes in the assumptions could result in additional impairment charges that could be material to our Consolidated Financial Statements in any given period.
One of our Programs includes a parent guarantee to the participating financial institution for a certain U.S. subsidiary that, at the time of the respective Program’s inception in 2015, was a guarantor subsidiary of the Company’s Credit Agreement.
One of the Programs includes a parent guarantee to the participating financial institution for a certain U.S. subsidiary that, at the time of the respective program’s inception in 2015, was a guarantor subsidiary of the Company’s credit agreement.
For our largest plan, the United States plan, the discount rate used for the December 31, 2023 measurement date is based on a yield curve approach where the expected future benefit payments are matched with a yield curve derived from certain AA-rated corporate bonds.
For our largest plan, the United States plan, the discount rate used for the December 31, 2024 measurement date is based on a yield curve approach where the expected future benefit payments are matched with a yield curve derived from certain AA-rated corporate bonds.
Accordingly, users of this Annual Report on Form 10-K are cautioned not to place undue reliance on the forward-looking statements. Table of Contents -44-
Accordingly, users of this Annual Report on Form 10-K are cautioned not to place undue reliance on the forward-looking statements. 41 Table of Contents
The methods corresponding to those described above are used to determine the discount rate and expected return on assets for non-U.S. pension and postretirement plans, to the extent applicable. RECENT ACCOUNTING PRONOUNCEMENTS Please refer to Note 1 of the Consolidated Financial Statements. ENVIRONMENTAL MATTERS Please refer to Note 16 of the Consolidated Financial Statements. Table of Contents -43- ITEM 7.
The methods corresponding to those described above are used to determine the discount rate and expected return on assets for non-U.S. pension and postretirement plans, to the extent applicable. RECENT ACCOUNTING PRONOUNCEMENTS Please refer to Note 1 of the Consolidated Financial Statements. ENVIRONMENTAL MATTERS Please refer to Note 17 of the Consolidated Financial Statements. 40 Table of Contents ITEM 7.
The result supported a discount rate of 4.90% at December 31, 2023 compared to 5.10% at December 31, 2022. A 25 basis point increase (decrease) in the discount rate would (decrease) increase the United States postretirement benefit obligation by approximately $2 million and (decrease) increase 2024 net periodic postretirement benefit cost by less than $1 million.
The result supported a discount rate of 5.55% at December 31, 2024 compared to 4.90% at December 31, 2023. A 25 basis point increase (decrease) in the discount rate would (decrease) increase the United States postretirement benefit obligation by approximately $2 million and (decrease) increase 2025 net periodic postretirement benefit cost by less than $1 million.
We expect that our cash on hand, coupled with future cash flows from operations and other available sources of liquidity, including our Senior Revolving Credit Facility and our Receivables Securitization Facility, will provide ample liquidity to enable us to meet our cash requirements for at least the next 12 months and foreseeable future thereafter.
We expect that our cash on hand, coupled with future cash flows from operations and other available sources of liquidity, including our Senior Revolving Credit Facility and our Receivables Securitization Facility, will provide ample liquidity to enable us to meet our cash requirements for at least the next 12 months and foreseeable future thereafter. 33 Table of Contents ITEM 7.
This process resulted in the selection of an expected return of 5.75% at the December 31, 2023 measurement date, which is used to determine net periodic pension cost for the year 2024. The expected return selected at the December 31, 2022 measurement date was 5.75%, which was used to determine the net periodic pension cost for the year 2023.
This process resulted in the selection of an expected return of 6.00% at the December 31, 2024 measurement date, which is used to determine net periodic pension cost for the year 2025. The expected return selected at the December 31, 2023 measurement date was 5.75%, which was used to determine the net periodic pension cost for the year 2024.
If all other assumptions remain constant, a 50 basis point increase in the selected discount rate of 11% would decrease the fair value of the Composites reporting unit by approximately 5%, and a 50 basis point decrease in the selected long-term growth rate of 2.5% would decrease the fair value of the Composites reporting unit by approximately 4%.
If all other assumptions remain constant, a 50 basis point increase in the selected discount rate of 11.5% would decrease the fair value by approximately 5%, and a 50 basis point decrease in the selected long-term growth rate of 2.0% would decrease the fair value by approximately 4%.
A 25 basis point increase (decrease) in return on plan assets assumption would result in a respective decrease (increase) of 2024 net periodic pension cost by approximately $1 million. The discount rate for our United States postretirement plan was selected using the same method as described for the pension plan.
A 25 basis point decrease in return on plan assets assumption would result in a respective increase of 2025 net periodic pension cost by less than $1 million. The discount rate for our United States postretirement plan was selected using the same method as described for the pension plan.
The anticipated increase in capital expenditures in 2024 is primarily driven by growth, manufacturing productivity and sustainability projects across all three segments. We expect that capital expenditures will be funded through cash flows from operations. See Note 2 and Note 6 of the Consolidated Financial Statements for additional information on property, plant and equipment.
The anticipated increase in capital expenditures in 2025 is primarily driven by growth, manufacturing productivity and sustainability projects. We expect that capital expenditures will be funded through cash flows from operations. See Note 2 and Note 6 of the Consolidated Financial Statements for additional information on Property, plant and equipment.
The Company made cash contributions of $18 million and $8 million to the plans during the twelve months ended December 31, 2023 and 2022, respectively. The Company expects to contribute $20 million in cash to its pension plans during 2024.
The Company made cash contributions of $7 million and $18 million to the plans during the twelve months ended December 31, 2024 and 2023, respectively. The Company expects to contribute $20 million in cash to its pension plans during 2025.
Material Cash Requirements Our anticipated uses of cash include capital expenditures, working capital needs, share repurchases, meeting financial obligations, payments of any dividends authorized by our Board of Directors, acquisitions, including the planned acquisition of Masonite, restructuring actions and pension contributions.
Material Cash Requirements Our anticipated uses of cash include capital expenditures, working capital needs, share repurchases, meeting financial obligations, payments of any dividends authorized by our Board of Directors, acquisitions, restructuring actions and pension contributions.
The most significant assumptions used in our analysis to determine the fair value of the Composites reporting unit are the discount rate and long-term growth rate.
The most significant assumptions used in our analysis to determine the fair value of the Composites reporting unit are the revenue growth rates, EBIT margins, long-term growth rate, and the discount rate.
Purchase obligations: Purchase obligations are commitments to suppliers to purchase goods or services, and include take-or-pay arrangements, capital expenditures, and contractual commitments to purchase equipment. As of December 31, 2023, the total of these obligations was $328 million, inclusive of $241 million payable in the next 12 months.
Purchase Obligations Purchase obligations are commitments to suppliers to purchase goods or services, and include take-or-pay arrangements, capital expenditures, and contractual commitments to purchase equipment. As of December 31, 2024, the total of these obligations was $411 million, inclusive of $287 million payable in the next 12 months.
The result supported a discount rate of 5.00% at December 31, 2023 compared to 5.15% at December 31, 2022. A 25 basis point increase (decrease) in the discount rate would (decrease) increase the December 31, 2023 projected benefit obligation for the United States pension plan by approximately $9 million.
The result supported a discount rate of 5.65% at December 31, 2024 compared to 5.00% at December 31, 2023. A 25 basis point increase (decrease) in the discount rate would (decrease) increase the December 31, 2024 projected benefit obligation for the United States pension plan by approximately $8 million.
Operating lease obligations: Our operating lease obligations primarily consist of real estate and material handling equipment. As of December 31, 2023, we had a total of $248 million of minimum operating lease payments. Further discussion of the future maturities of these lease liabilities can be found in Note 9 of the Consolidated Financial Statements.
As of December 31, 2024, we had a total of $463 million of minimum finance lease payments. Further discussion of the future maturities of these lease liabilities can be found in Note 10 of the Consolidated Financial Statements. Operating Lease Obligations Our operating lease obligations primarily consist of real estate and material handling equipment.
The assumed cash flows from this calculation are discounted at a rate based on a market-participant discount rate. Our annual test of indefinite-lived intangibles was conducted as of October 1, 2023. The fair value of each of our indefinite-lived intangible assets exceeded the carrying value as of the date of our assessment. Table of Contents -41- ITEM 7.
The assumed cash flows from this calculation are discounted at a rate based on a market-participant discount rate. Our annual test of indefinite-lived intangibles was conducted as of October 1, 2024. The fair value of each of our indefinite-lived intangible assets exceeded the carrying value as of the date of our assessment.
Our estimated cost of our standard warranty obligations is calculated using a 5-year historical average of claims paid for each major product category, the estimated future cost to manufacture the replacement shingles, and the estimated future cost for contractor labor, subject to the applicable warranty coverage, for a 20-year period from the date of installation.
Our estimated cost of our standard warranty obligations is calculated using a 10-year historical average of claims paid for each major product category, the estimated future cost to manufacture the replacement shingles, and the estimated future cost for contractor labor, subject to the applicable warranty coverage, for a 20-year period from the date of installation. 39 Table of Contents ITEM 7.
The following discussion of material cash requirements evaluates known contractual and other obligations, but does not include amounts that are contingent on events or other factors that are uncertain or unknown at this time including legal contingencies, and uncertain tax positions among others.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) The following discussion of material cash requirements evaluates known contractual and other obligations, but does not include amounts that are contingent on events or other factors that are uncertain or unknown at this time including legal contingencies and uncertain tax positions among others.
If it is more likely than not that a reporting unit’s fair value is less than or close to its carrying value, then the quantitative impairment test must be performed to determine if impairment is required. Table of Contents -40- ITEM 7.
If it is more likely than not that a reporting unit’s fair value is less than or close to its carrying value, then the quantitative impairment test must be performed to determine if impairment is required.
The Company has three reporting units: Roofing, Insulation and Composites. 2023 Annual Goodwill Impairment Assessment Goodwill is an intangible asset that is not subject to amortization; however, annual tests are required to be performed to determine whether impairment exists.
The Company has four reporting units: Roofing, Insulation, Doors and Composites. 2024 Goodwill Impairment Assessments Goodwill is an intangible asset that is not subject to amortization; however, annual tests are required to be performed to determine whether impairment exists.
During the fourth quarter of 2023, the average Seasonally Adjusted Annual Rate (“SAAR”) of U.S. housing starts was approximately 1.454 million starts, which is up from 1.403 million starts in the fourth quarter of 2022.
During the fourth quarter of 2024, the average Seasonally Adjusted Annual Rate (“SAAR”) of U.S. housing starts was approximately 1.379 million starts, which is down from 1.454 million starts in the fourth quarter of 2023.
Earnings before interest, taxes, depreciation and amortization (“EBITDA”) by segment is a non-GAAP measure that consists of EBIT plus depreciation and amortization. Segment EBITDA is used internally by the Company for analysis of our performance.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) Earnings before interest, taxes, depreciation and amortization (“EBITDA”) by segment is a non-GAAP measure that consists of EBIT plus depreciation and amortization. Segment EBITDA is used internally by the Company for analysis of our performance.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) The expected return on plan assets in the United States was derived by taking into consideration the target plan asset allocation, historical rates of return on those assets, projected future asset class returns and net outperformance of the market by active investment managers and plan related and investment related expenses paid from the plan trust.
The expected return on plan assets in the United States was derived by taking into consideration the target plan asset allocation, historical rates of return on those assets, projected future asset class returns and net out performance of the market by active investment managers and plan related and investment related expenses paid from the plan trust.
Certain items, such as general corporate expenses or income and certain other expense or income items, are excluded from the internal evaluation of segment performance. Accordingly, these items are not reflected in EBIT for our reportable segments and are included in the Corporate, Other and Eliminations category, which is presented following the discussion of our reportable segments.
Corporate, Other and Eliminations Certain items, such as general corporate expenses or income and certain other expense or income items, are excluded from the internal evaluation of segment performance. Accordingly, these items are not reflected in EBIT for our reportable segments and are included within Corporate, Other and Eliminations. 31 Table of Contents ITEM 7.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) When it is determined necessary for the Company to perform the quantitative impairment process for goodwill, we estimate fair values using a discounted cash flow approach from the perspective of a market participant.
When it is determined necessary for the Company to perform the quantitative impairment process for goodwill, we estimate fair values using a discounted cash flow approach from the perspective of a market participant, as well as the market approach.
A 25 basis point increase (decrease) in the discount rate would (decrease) increase 2024 net periodic pension cost by less than $1 million. Table of Contents -42- ITEM 7.
A 25 basis point increase (decrease) in the discount rate would (decrease) increase 2025 net periodic pension cost by less than $1 million.
Further discussion of the Company's defined benefit pension plans can be found in Note 14 of the Consolidated Financial Statements.
Further discussion of the Company's defined benefit pension plans can be found in Note 15 of the Consolidated Financial Statements. 34 Table of Contents ITEM 7.
We estimate future taxable income and the effect of tax planning strategies in our consideration of whether deferred tax assets will more likely than not be realized.
In addition, we record a valuation allowance to reduce our deferred tax assets to the amount that we believe is more likely than not to be realized. We estimate future taxable income and the effect of tax planning strategies in our consideration of whether deferred tax assets will more likely than not be realized.
Additionally, the Company sells contractors extended warranties that extend coverage beyond our standard product warranty. The extended warranties revenue is deferred and recognized over the related coverage period, ranging from 16 to 20 years. Pensions and Other Postretirement Benefits.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) Additionally, the Company sells contractors extended warranties that extend coverage beyond our standard product warranty. The extended warranties revenue is deferred and recognized over the related coverage period, ranging from 16 to 20 years.
LIQUIDITY, CAPITAL RESOURCES AND OTHER RELATED MATTERS Liquidity The Company's primary sources of liquidity are its balance of Cash and cash equivalents of $1.6 billion as of December 31, 2023, its Senior Revolving Credit Facility and its Receivables Securitization Facility (each as defined below).
LIQUIDITY, CAPITAL RESOURCES AND OTHER RELATED MATTERS Liquidity The Company's primary sources of liquidity are its balance of Cash and cash equivalents of $361 million as of December 31, 2024, its senior revolving credit facility (the “Senior Revolving Credit Facility”) and Receivables Securitization Facility.
We have no material off-balance sheet arrangements that have or are reasonably likely to have a material current or future effect on our financial condition, results of operations, liquidity, capital expenditures or other resources.
We have no material off-balance sheet arrangements that have or are reasonably likely to have a material current or future effect on our financial condition, results of operations, liquidity, capital expenditures or other resources. Cash Flows Cash and cash equivalents were $361 million as of December 31, 2024, compared to $1.6 billion as of December 31, 2023.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) The following table shows how the Company utilized its primary sources of liquidity (in millions): As of December 31, 2023 Senior Revolving Credit Facility Receivables Securitization Facility Facility size $ 800 $ 280 Collateral capacity limitation on availability N/A — Outstanding borrowings — — Outstanding letters of credit 4 1 Availability on facility $ 796 $ 279 The Receivables Securitization Facility and Senior Revolving Credit Facility mature in 2024 and 2026, respectively.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) The following table shows how the Company utilized its primary sources of liquidity: As of December 31, 2024 (In millions) Senior Revolving Credit Facility Receivables Securitization Facility Facility size or borrowing limit $ 1,000 $ 300 Collateral capacity limitation on availability N/A — Outstanding borrowings — — Outstanding letters of credit 4 1 Availability on facility $ 996 $ 299 The agreements governing our Senior Revolving Credit Facility and Receivables Securitization Facility contain various covenants that we believe are usual and customary.
Capital Expenditures: Our capital expenditures are primarily related to the maintenance and rebuild of our long-term assets, as well as investing in projects that support growth and innovation to further our enterprise strategy. Our capital expenditures on a Table of Contents -37- ITEM 7.
Capital Expenditures Our capital expenditures are primarily related to the maintenance and rebuild of our long-term assets, as well as investing in projects that support growth and innovation to further our enterprise strategy. Our capital expenditures were $647 million in 2024. We expect to have capital expenditures of approximately $800 million in 2025.
Other Strategic Uses of Cash: We have outstanding share repurchase authorizations and will evaluate and consider repurchasing shares of our common stock, as well as payments of any dividends authorized by our Board of Directors, strategic acquisitions, joint ventures, debt repurchases or repayments and other transactions to create stockholder value and enhance financial performance.
Other Strategic Uses of Cash We will evaluate and consider payments of any dividends authorized by our Board of Directors, strategic acquisitions, joint ventures, debt repurchases or repayments and other transactions to create stockholder value and enhance financial performance. Such transactions may require cash expenditures beyond current sources of liquidity or generated proceeds.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) Fair Value Measurement Please refer to Notes 1, 4, 13, 14 and 15 of the Consolidated Financial Statements.
Derivatives Please refer to Note 4 of the Consolidated Financial Statements. Fair Value Measurement Please refer to Notes 1, 4, 14, 15 and 16 of the Consolidated Financial Statements.
Roofing The table below provides a summary of net sales, EBIT, depreciation and amortization expense, and EBITDA for the Roofing segment (in millions): Twelve Months Ended December 31, 2023 2022 2021 Net sales $ 4,030 $ 3,658 $ 3,209 % change from prior year 10 % 14 % 19 % EBIT $ 1,174 $ 831 $ 753 EBIT as a % of net sales 29 % 23 % 23 % Depreciation and amortization expense $ 64 $ 62 $ 59 EBITDA $ 1,238 $ 893 $ 812 EBITDA as a % of net sales 31 % 24 % 25 % NET SALES In our Roofing segment, net sales increased $372 million in 2023 compared to 2022 due to higher sales volumes of approximately 5% and higher selling prices of $166 million.
Roofing The table below provides a summary of net sales, EBIT, depreciation and amortization expense, and EBITDA for the Roofing segment: Twelve Months Ended December 31, (In millions) 2024 2023 Net sales $ 4,052 $ 4,030 % change from prior year 1 % 10 % EBIT $ 1,298 $ 1,174 EBIT as a % of net sales 32 % 29 % Depreciation and amortization expense $ 62 $ 64 EBITDA $ 1,360 $ 1,238 EBITDA as a % of net sales 34 % 31 % NET SALES In our Roofing segment, net sales increased $22 million in 2024 compared to 2023 due to higher selling prices of $165 million and favorable product mix, mostly offset by lower volumes of approximately 6%.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) Composites The table below provides a summary of net sales, EBIT, depreciation and amortization expense and EBITDA for the Composites segment (in millions): Twelve Months Ended December 31, 2023 2022 2021 Net sales $ 2,286 $ 2,660 $ 2,341 % change from prior year -14 % 14 % 19 % EBIT $ 242 $ 498 $ 376 EBIT as a % of net sales 11 % 19 % 16 % Depreciation and amortization expense $ 172 $ 175 $ 162 EBITDA $ 414 $ 673 $ 538 EBITDA as a % of net sales 18 % 25 % 23 % NET SALES Net sales in our Composites segment decreased $374 million in 2023 compared to 2022.
Composites The table below provides a summary of net sales, EBIT, depreciation and amortization expense and EBITDA for the Composites segment: Twelve Months Ended December 31, (In millions) 2024 2023 Net sales $ 2,118 $ 2,286 % change from prior year -7 % -14 % EBIT $ 215 $ 242 EBIT as a % of net sales 10 % 11 % Depreciation and amortization expense $ 182 $ 172 EBITDA $ 397 $ 414 EBITDA as a % of net sales 19 % 18 % NET SALES Net sales in our Composites segment decreased $168 million in 2024 compared to 2023.
As of December 31, 2023 and December 31, 2022, the Company had $114 million and $188 million, respectively, in cash and cash equivalents in certain of its foreign subsidiaries. The Company continues to assert indefinite reinvestment in accordance with Accounting Standards Codification (“ASC”) 740 based on the laws as of enactment of the tax legislation commonly known as the U.S.
The Company continues to assert indefinite reinvestment in accordance with Accounting Standards Codification (“ASC”) 740 based on the laws as of enactment of the tax legislation commonly known as the U.S. Tax Cuts and Jobs Act of 2017.
The carrying values of the European building and technical insulation trade name and the global cellular glass insulation trademark are $90 million and $80 million, respectively. Both of these assets are included within the Insulation segment. The fair value of the remaining assets substantially exceeded their carrying value as of the date of our assessment.
The carrying value of the European building and technical insulation trade name is $84 million as of December 31, 2024. This asset is included within the Insulation segment. The fair value of the remaining assets substantially exceeded their carrying value as of the date of our assessment.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) Supplier Finance Programs We review supplier terms and conditions on an ongoing basis, and have negotiated payment terms extensions in recent years in connection with our efforts to reduce working capital and improve cash flow.
Supplier Finance Programs We review supplier terms and conditions on an ongoing basis, and have negotiated payment terms extensions in recent years in connection with our efforts to reduce working capital and improve cash flow. Separate from those terms extension actions, certain of our subsidiaries have entered into paying agency agreements with third-party administrators.
The terminal business value is determined by applying the long-term growth rate to the latest year for which a forecast exists. As part of our goodwill quantitative testing process, the Company evaluates whether there are reasonably likely changes to management’s estimates that would have a material impact on the results of the goodwill impairment testing.
As part of our goodwill quantitative testing process, the Company evaluates whether there are reasonably likely changes to management’s estimates that would have a material impact on the results of the goodwill impairment testing. 37 Table of Contents ITEM 7.
Our annual test of goodwill for impairment was conducted as of October 1, 2023. The Company elected to perform the qualitative approach on all of its reporting units: Roofing, Insulation and Composites.
The interim testing indicated that the business enterprise value of the Composites reporting unit exceeded its carrying value by less than 10%. Annual Goodwill Testing Our annual test of goodwill for impairment was conducted as of October 1, 2024. The Company elected to perform the qualitative approach on all of its reporting units.
Finance lease obligations: Our finance lease obligations primarily consist of real estate, oxygen plants, computers and software, and fleet vehicles. As of December 31, 2023 we had a total of $196 million of minimum finance lease payments. Further discussion of the future maturities of these lease liabilities can be found in Note 9 of the Consolidated Financial Statements.
As of December 31, 2024, we had a total of $580 million of minimum operating lease payments. Further discussion of the future maturities of these lease liabilities can be found in Note 10 of the Consolidated Financial Statements.
For the trademark used on global cellular glass insulation products, if all other assumptions remain constant, a 50 basis point increase in the selected discount rate of 12.0% would decrease the fair value by approximately 5%, and a 50 basis point decrease in the selected long-term growth rate of 2.0% would decrease the fair value by approximately 4%.
If all other assumptions remain constant, a 2% decrease in the base year revenue would decrease the fair value by approximately 1%, a 1% decrease in the revenue growth rates would decrease the fair value by approximately 1%, a 50 basis point decrease in forecasted annual EBIT margins would decrease the fair value by approximately 2%, a 50 basis point decrease in the selected long-term growth rate of 2% would decrease the fair value by approximately 2%, and a 50 basis point increase in the selected discount rate of 11.5% would decrease the fair value by approximately 3%.
The decrease was primarily driven by lower sales volumes of approximately 12% and the net unfavorable impact of divestitures and acquisitions. Unfavorable customer mix of $16 million was partially offset by higher selling prices of $9 million and the favorable impact of translating sales denominated in foreign currencies into United States dollars.
The decrease was primarily driven by lower selling prices of $83 million, lower sales volumes of approximately 1%, unfavorable customer mix and $11 million of unfavorable impact of translating sales denominated in foreign currencies into United States dollars. EBIT EBIT in our Composites segment decreased $27 million in 2024 compared to 2023.
After evaluating and weighing all relevant events and circumstances, we concluded it is more likely than not that the fair value of the Roofing and Insulation reporting units exceeds their respective carrying value amounts. Consequently, we did not perform a quantitative analysis for the Roofing and Insulation reporting units and determined that their goodwill was not impaired for 2023.
After evaluating and weighing all relevant events and circumstances, we concluded it is more likely than not that the fair value of the Roofing and Insulation reporting units exceeds their respective carrying value amounts while the Doors reporting unit business enterprise value approximates its carrying value given the acquisition that occurred in May 2024.
These voluntary supply chain finance programs (collectively, the “Programs”) generally give participating suppliers the ability to sell, or otherwise pledge as collateral, their receivables from the Company to the participating financial institutions, at the sole discretion of both the suppliers and financial institutions. The Company is not a party to the arrangements between the suppliers and the financial institutions.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) pledge as collateral, their receivables from the Company to the participating financial institutions, at the sole discretion of both the suppliers and financial institutions. The Company is not a party to the arrangements between the suppliers and the financial institutions.
Such uncertainties include any claims by the Internal Revenue Service for income taxes, interest, and penalties attributable to audits of open tax years. In addition, we record a valuation allowance to reduce our deferred tax assets to the amount that we believe is more likely than not to be realized.
Tax Estimates The determination of our tax provision is complex due to operations in several tax jurisdictions outside the United States. We apply a more-likely-than-not recognition threshold for all tax uncertainties. Such uncertainties include any claims by the Internal Revenue Service for income taxes, interest, and penalties attributable to audits of open tax years.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) Corporate, Other and Eliminations The table below provides a summary of EBIT and depreciation and amortization expense for the Corporate, Other and Eliminations category (in millions): Twelve Months Ended December 31, 2023 2022 2021 Restructuring costs $ (169) $ (48) $ (34) Gain on sale of land in India — — 15 Gains on sale of certain precious metals 2 18 53 Intangible assets impairment charge — (96) — Recognition of acquisition inventory fair value step-up — — (1) Pension settlement losses (145) — — Acquisition and divestiture-related costs — (7) — Gain on sale of Santa Clara, California site 189 — — Gain on sale of Shanghai, China facility — 27 — Gain on remeasurement of Fiberteq equity investment — 130 — Paroc marine recall (15) — — Loss on sale of Chambery, France DUCS business — (30) — Loss on sale of Russian operations — (33) — General corporate expense and other (230) (179) (160) EBIT $ (368) $ (218) $ (127) Depreciation and amortization $ 163 $ 88 $ 73 EBIT The impact on EBIT from Corporate, Other and Eliminations in 2023 was $150 million higher compared to 2022.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) The following table summarizes these items and depreciation and amortization expense included within Corporate, Other and Eliminations: Twelve Months Ended December 31, (In millions) 2024 2023 Restructuring costs $ (86) $ (169) Gain on sale of Santa Clara, California site — 189 Pension settlement losses — (145) Acquisition-related integration costs (83) — Gains on sale of certain precious metals 19 2 Strategic review-related charges (46) — Acquisition-related transaction costs (49) — Loss on sale of business (91) — Recognition of acquisition inventory fair value step-up (18) — Paroc marine recall (58) (15) Impairment of venture investments (15) — Impairment due to strategic review (483) — General corporate expense and other (256) (230) Total Corporate, Other and Eliminations EBIT $ (1,166) $ (368) Depreciation and amortization $ 90 $ 163 EBIT The impact on EBIT from Corporate, Other and Eliminations in 2024 was $798 million higher compared to 2023.
Tax Cuts and Jobs Act of 2017. As a holding company, we have no operations of our own and most of our assets are held by our direct and indirect subsidiaries.
These covenants include a maximum allowed leverage ratio. We were in compliance with these covenants as of December 31, 2024. As a holding company, we have no operations of our own and most of our assets are held by our direct and indirect subsidiaries.
OUTLOOK In our Roofing segment, the Company expects North American new residential construction market to temporarily remain soft. Other uncertainties that may impact Roofing demand include demand from storms and other weather-related events, demand from repair and remodeling activity, competitive pricing pressure and the cost and availability of raw materials, particularly asphalt.
Other uncertainties that may impact Roofing demand include demand from storms and other weather-related events, competitive pricing pressure and the cost and availability of raw materials, particularly asphalt. The Company will continue to focus on managing costs, capital expenditures and working capital to best service the market demand.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) Insulation The table below provides a summary of net sales, EBIT, depreciation and amortization expense and EBITDA for the Insulation segment (in millions): Twelve Months Ended December 31, 2023 2022 2021 Net sales $ 3,668 $ 3,714 $ 3,184 % change from prior year -1 % 17 % 22 % EBIT $ 619 $ 612 $ 446 EBIT as a % of net sales 17 % 16 % 14 % Depreciation and amortization expense $ 210 $ 206 $ 208 EBITDA $ 829 $ 818 $ 654 EBITDA as a % of net sales 23 % 22 % 21 % NET SALES In our Insulation segment, 2023 net sales decreased $46 million compared to 2022.
Insulation The table below provides a summary of net sales, EBIT, depreciation and amortization expense and EBITDA for the Insulation segment: Twelve Months Ended December 31, (In millions) 2024 2023 Net sales $ 3,692 $ 3,668 % change from prior year 1 % -1 % EBIT $ 682 $ 619 EBIT as a % of net sales 18 % 17 % Depreciation and amortization expense $ 210 $ 210 EBITDA $ 892 $ 829 EBITDA as a % of net sales 24 % 23 % 29 Table of Contents ITEM 7.
The following table summarizes the segment allocation of recorded goodwill on our Consolidated Balance Sheet as of December 31, 2023 (in millions): Segment December 31, 2023 Percent of Total Roofing $ 395 28 % Insulation 572 41 % Composites 425 31 % Total goodwill $ 1,392 100 % Annual 2023 Indefinite-lived Intangible Asset Impairment Assessment Fair values used in testing for potential impairment of our trademarks and trade names are calculated by applying an estimated market value royalty rate to the forecasted revenues of the businesses that utilize those assets.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) Annual 2024 Indefinite-lived Intangible Asset Impairment Assessment Fair values used in testing for potential impairment of our trademarks and trade names are calculated by applying an estimated market value royalty rate to the forecasted revenues of the businesses that utilize those assets.
Adjusting (expense) income items to EBIT are shown in the table below (in millions): Twelve Months Ended December 31, 2023 2022 2021 Restructuring costs $ (169) $ (48) $ (34) Gain on sale of land in India — — 15 Gains on sale of certain precious metals 2 18 53 Intangible assets impairment charge — (96) — Recognition of acquisition inventory fair value step-up — — (1) Pension settlement losses (145) — — Acquisition and divestiture-related costs — (7) — Gain on sale of Santa Clara, California site 189 — — Gain on sale of Shanghai, China facility — 27 — Gain on remeasurement of Fiberteq equity investment — 130 — Paroc marine recall (15) — — Loss on sale of Chambery, France DUCS business — (30) — Loss on sale of Russian operations — (33) — Total adjusting items $ (138) $ (39) $ 33 The reconciliation from Net earnings (loss) attributable to Owens Corning to EBIT and Adjusted EBIT is shown in the table below (in millions): Twelve Months Ended December 31, 2023 2022 2021 NET EARNINGS ATTRIBUTABLE TO OWENS CORNING $ 1,196 $ 1,241 $ 995 Net loss attributable to non-redeemable and redeemable noncontrolling interests (3) — — NET EARNINGS 1,193 1,241 995 Equity in net earnings of affiliates 3 — 1 Income tax expense 401 373 319 EARNINGS BEFORE TAXES 1,591 1,614 1,313 Interest expense, net 76 109 126 Loss on extinguishment of debt — — 9 EARNINGS BEFORE INTEREST AND TAXES 1,667 1,723 1,448 Less: Adjusting items from above (138) (39) 33 ADJUSTED EBIT $ 1,805 $ 1,762 $ 1,415 Table of Contents -32- ITEM 7.
Adjusting (expense) income items to EBIT are shown in the table below: Twelve Months Ended December 31, (In millions) 2024 2023 Restructuring costs $ (86) $ (169) Acquisition-related integration costs (83) — Gains on sale of certain precious metals 19 2 Loss on sale of business (91) — Strategic review-related charges (46) — Recognition of acquisition inventory fair value step-up (18) — Pension settlement losses — (145) Impairment due to strategic review (483) — Acquisition-related transaction costs (49) — Gain on sale of Santa Clara, California site — 189 Paroc marine recall (58) (15) Impairment of venture investments $ (15) $ — Total adjusting items $ (910) $ (138) The reconciliation from Net earnings attributable to Owens Corning to EBIT and Adjusted EBIT is shown in the table below: Twelve Months Ended December 31, (In millions) 2024 2023 NET EARNINGS ATTRIBUTABLE TO OWENS CORNING $ 647 $ 1,196 Net loss attributable to non-redeemable and redeemable noncontrolling interests — (3) NET EARNINGS 647 1,193 Equity in net earnings of affiliates 6 3 Income tax expense 275 401 EARNINGS BEFORE TAXES 916 1,591 Interest expense, net 212 76 EARNINGS BEFORE INTEREST AND TAXES 1,128 1,667 Less: Adjusting items from above (910) (138) ADJUSTED EBIT $ 2,038 $ 1,805 Segment Results EBIT by segment consists of net sales less related costs and expenses and is presented on a basis that is used internally for evaluating segment performance.
Testing indicated that the business enterprise value for the Composites reporting unit exceeded its carrying value by approximately 5%. There is uncertainty surrounding the macroeconomic factors that impact this reporting unit and a sustained downturn in these factors or a change in the long-term revenue growth or profitability for this reporting unit could increase the likelihood of a future impairment.
The likelihood of a future impairment could be increased by a sustained downturn in these macroeconomic factors, a change in the long-term revenue growth rate or profitability for this reporting unit, or the outcome of the strategic review.
Long-term debt obligations, including current portion of long-term debt: As of December 31, 2023, total long-term debt of $3.0 billion primarily consists of various outstanding senior notes. The current portion of long-term debt includes $399 million of 4.2% senior notes maturing in the fourth quarter of 2024.
Long-term Debt Obligations, including Current Portion of Long-term Debt As of December 31, 2024, the Company had $5.1 billion of total debt, which mostly consists of long-term debt relating to various outstanding senior notes. In addition, the Company's current portion of long-term debt of $38 million primarily relates to the current portion of finance leases.
For the Composites reporting unit, based on the qualitative assessment we concluded that it is more likely than not that the fair value of the reporting unit was less than its carrying amount. Therefore, we performed a quantitative analysis as described above. As a result of this test, we determined that no impairment existed for the reporting unit.
As a result of this test, we determined that no impairment existed for the reporting unit. Testing indicated that the business enterprise value for the Composites reporting unit exceeded its carrying value by less than 5%.
Further discussion of the amount and timing of the future scheduled maturities of our senior notes can be found in Note 13 of the Consolidated Financial Statements. There were no borrowings on our Senior Revolving Credit Facility or our Receivables Securitization Facility as of December 31, 2023.
In the fourth quarter of 2024, the Company repaid the 2024 senior notes of $400 million at maturity. Further discussion of the amount and timing of the future scheduled maturities of our senior notes can be found in Note 14 of the Consolidated Financial Statements.
Management tests asset groups for potential impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. We evaluated and concluded that there are not any reasonably likely changes to management’s estimates that would indicate that the carrying value of our long-lived assets is unrecoverable.
The Company groups long-lived assets based on manufacturing facilities that produce similar products either globally or within a geographic region. Management tests asset groups for potential impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable.
Favorable product and customer mix were partially offset by lower third-party asphalt sales of $44 million. EBIT In our Roofing segment, EBIT increased $343 million in 2023 compared to 2022 driven primarily by higher selling prices of $166 million.
EBIT In our Roofing segment, EBIT increased $124 million in 2024 compared to 2023 driven primarily by higher selling prices of $165 million, favorable product mix and favorable delivery of $22 million, slightly offset by lower sales volumes and input cost inflation. OUTLOOK In our Roofing segment, the Company expects residential repair and remodeling activity to remain solid.
A change in the estimated long-term revenue growth rate or increase in the discount rate assumption could increase the likelihood of a future impairment for these assets.
Testing indicated that the fair value of a trade name used by our European building and technical insulation business exceeded its carrying values by 3%. A change in the estimated long-term revenue growth rate or increase in the discount rate assumption could increase the likelihood of a future impairment for this asset.
For impairment testing, long-lived assets are grouped at the lowest level for which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities. The Company groups long-lived assets based on manufacturing facilities that produce similar products either globally or within a geographic region.
Long-lived Asset Recoverability and Impairment Assessments The recoverable value for long-lived asset testing are calculated by estimating the undiscounted cash flows from the use and ultimate disposition of the asset. For impairment testing, long-lived assets are grouped at the lowest level for which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities.
OUTLOOK In 2024, we expect general corporate expenses to range between $240 and $250 million, without considering the effect of the planned acquisition of Masonite.
General corporate expense and other in 2024 was $26 million higher than in 2023. OUTLOOK In 2025, we expect general corporate expenses to range between $240 and $260 million.
The Company expects both the North American new residential construction market and global commercial and industrial construction markets to temporarily remain soft with the weaker macro-economic outlook, higher interest rates and continued input cost inflation. The Company remains focused on managing costs, capital expenditures, and working capital. Table of Contents -34- ITEM 7.
The Company expects the North America residential new construction market to be temporarily challenged, with discretionary residential repair and remodeling activity in North America to remain soft. Due to a weaker macroeconomic outlook and higher interest rates in Europe, the Company expects these markets to remain challenged. The Company will concentrate on managing costs, capital expenditures and working capital.
The remaining variance was driven by unfavorable customer mix, higher rebuild costs and the $5 million negative impact of translating profits denominated in foreign currencies into United States dollars, which was partially offset by favorable manufacturing costs.
Lower selling prices of $83 million, unfavorable customer mix, higher start-up costs of $18 million, higher production downtime of $13 million and $7 million of unfavorable impact of translating sales denominated in foreign currencies into United States dollars, which more than offset lower manufacturing costs of $90 million and $23 million of favorable delivery and input costs.
Interest on debt: We are obligated to make periodic interest payments at fixed rates, depending on the terms of the applicable debt agreements. Based on interest rates and scheduled maturities as of December 31, 2023, these interest obligations range from $99 million to $130 million annually over the next five years.
Based on interest rates and scheduled maturities as of December 31, 2024, these interest obligations range from $199 million to $242 million annually over the next five years. Finance Lease Obligations Our finance lease obligations primarily consist of real estate, oxygen plants, computers and software and fleet vehicles.
On February 9, 2024, the three major credit rating agencies reaffirmed our investment-grade debt ratings. Cash and cash equivalents held by foreign subsidiaries may be subject to foreign withholding taxes upon repatriation to the U.S.
Cash and cash equivalents held by foreign subsidiaries may be subject to foreign withholding taxes upon repatriation to the U.S. As of December 31, 2024 and December 31, 2023, the Company had $95 million and $114 million, respectively, in cash and cash equivalents in certain of its foreign subsidiaries.
The remaining improvement was driven by favorable input costs and delivery of $80 million, higher sales volumes, and favorable customer and product mix of $48 million, which were partially offset by higher selling, general and administrative expenses and $8 million of higher production costs.
The increase was driven by higher selling prices of $81 million, favorable delivery of $34 million, lower start-up costs and favorable product mix, which more than offset higher manufacturing costs of $35 million, higher operating expenses, inclusive of incremental costs associated with evaluating manufacturing investments, lower sales volumes and unfavorable customer mix.
EBIT In our Insulation segment, EBIT increased $7 million in 2023 compared to 2022. Higher selling prices of $245 million more than offset lower sales volumes and $57 million of input cost inflation. Higher manufacturing costs of $29 million and higher production downtime were partially offset by favorable delivery of $21 million and favorable customer and product mix.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) NET SALES In our Insulation segment, 2024 net sales increased $24 million compared to 2023. The increase was driven primarily by higher selling prices of $81 million and favorable product mix, partially offset by lower sales volumes of approximately 2% and unfavorable customer mix.
The decrease in cash provided by operating activities was primarily due to reductions in payables and lower earnings in 2023, which were partially offset by inventory reductions. Investing activities: The cash used for investing activities in 2023 was $356 million compared to $623 million in 2022.
Operating activities: Net cash flow provided by operating activities increased by $173 million for the twelve months ended December 31, 2024 compared to the same period in 2023. The increase in cash provided by operating activities was primarily due to lower increases in accounts payable and higher decreases in inventory when compared to the same period in 2023.
Removed
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) Segment Results EBIT by segment consists of net sales less related costs and expenses and is presented on a basis that is used internally for evaluating segment performance.
Added
Certain items, such as general corporate expenses or income and certain other expense or income items, are excluded from the internal evaluation of segment performance.
Removed
The Company will continue to focus on managing costs, capital expenditures and working capital. Table of Contents -33- ITEM 7.
Added
Accordingly, these items are not reflected in EBIT for our reportable segments and are included in the Corporate, Other and Eliminations category, which is presented following the discussion of our reportable segments. 28 Table of Contents ITEM 7.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

9 edited+2 added−6 removed8 unchanged
Biggest changeThe following table shows how a one percentage point increase / decrease in interest rates would impact the fair market value of the senior notes: Senior Notes Maturity Year As of December 31, 2023: 2024 2026 2029 2030 2036 2047 2048 Increase in interest rates Decrease in fair value 1% 2% 5% 5% 8% 13% 13% Decrease in interest rates Increase in fair value 1% 3% 5% 6% 9% 16% 16% Senior Notes Maturity Year As of December 31, 2022: 2024 2026 2029 2030 2036 2047 2048 Increase in interest rates Decrease in fair value 2% 3% 6% 6% 8% 12% 12% Decrease in interest rates Increase in fair value 2% 3% 6% 7% 10% 15% 15% Commodity Price Risk The Company is exposed to changes in prices of commodities used in its operations, primarily associated with energy, such as natural gas, and raw materials, such as asphalt and polystyrene.
Biggest changeThe following table shows how a one percentage point increase in interest rates would impact the fair market value of the senior notes: Senior Notes Maturity Year As of December 31, 2024: 2026 2027 2028 2029 2030 2034 2036 2047 2048 2054 Decrease in fair value 2% 2% 3% 4% 5% 7% 8% 12% 12% 12% 42 Table of Contents ITEM 7A.
As of December 31, 2022, the Company had no borrowings on its Senior Revolving Credit Facility or Receivables Securitization Facility, with the balance of other floating rate debt of $1 million. Cash and cash equivalents were $1.6 billion and $1.1 billion at December 31, 2023 and 2022, respectively.
As of December 31, 2024 and 2023, the Company had no borrowings on its Senior Revolving Credit Facility or Receivables Securitization Facility, with the balance of other floating-rate debt of $1 million. Cash and cash equivalents were $361 million and $1.6 billion at December 31, 2024 and 2023, respectively.
Our most significant translation exposures are the Canadian Dollar, Chinese Yuan, European Euro, Indian Rupee, and Polish Złoty in relation to the United States Dollar. Interest Rate Risk The Company is subject to market risk from exposure to changes in interest rates due to its financing, investing, and cash management activities.
Our most significant translation exposures are the European Euro, Canadian Dollar, Chinese Yuan, Polish Złoty and Great Britain Pound in relation to the United States Dollar. Interest Rate Risk The Company is subject to market risk from exposure to changes in interest rates due to its financing, investing and cash management activities.
As of December 31, 2022, the potential change in fair value for such financial instruments from an increase (decrease) of 10% in the quoted foreign currency exchange rates would be a (decrease) increase of approximately $7 million and $5 million, respectively. We have translation exposure resulting from translating the financial statements of foreign subsidiaries into United States Dollars.
As of December 31, 2024, the potential change in fair value for such financial instruments from an increase of 10% in the quoted foreign currency exchange rates would be a decrease of approximately $6 million. We have translation exposure resulting from translating the financial statements of foreign subsidiaries into United States Dollars.
The Company enters into cash-settled natural gas swap contracts in certain markets to protect against changes in natural gas prices that mature within 15 months; however, no financial instruments are currently used to protect against changes in raw material costs.
The Company enters into cash-settled natural gas swap contracts in certain markets to protect against changes in natural gas prices that mature within 15 months; however, no financial instruments are currently used to protect against changes in raw material costs. At December 31, 2024, the net fair value of such swap contracts was an asset of $3 million.
These transactional risks are mitigated through the use of derivative financial instruments and balancing of cash deposits and loans. The net fair value of derivative financial instruments used to limit exposure to foreign currency risk was a liability of less than $1 million and a liability of $1 million as of December 31, 2023 and 2022, respectively.
The net fair value of derivative financial instruments used to limit exposure to foreign currency risk was a liability of less than $1 million as of December 31, 2024.
Based on the year-end outstanding balances on floating rate debt, a one percentage point increase (decrease) in interest rates at December 31, 2023 and 2022 would increase (decrease) our annual net interest expense by less than $1 million for each year. Table of Contents -45- ITEM 7A.
Based on the year-end outstanding balances on floating rate debt, a one percentage point increase in interest rates at December 31, 2024 would increase our annual net interest expense by less than $1 million. The fair market value of the Company’s senior notes are subject to interest rate risk.
The Company enters into various forward contracts, which change in value as foreign currency exchange rates change, to preserve the carrying amount of foreign currency-denominated assets, liabilities, commitments, and certain anticipated foreign currency transactions.
The Company enters into various forward contracts, which change in value as foreign currency exchange rates change, to preserve the carrying amount of foreign currency-denominated assets, liabilities, commitments and certain anticipated foreign currency transactions. Exposures in U.S. Dollars primarily relate to the Indian Rupee, Brazilian Real, South Korean Won, Chinese Yuan, Hong Kong Dollar and the European Euro exchange rates.
This amount excludes the offsetting impact of the price risk inherent in the physical purchase of the underlying commodities. Table of Contents -46-
An increase of 10% in the underlying commodity prices would result in an increase in fair value of $4 million as of December 31, 2024. This amount excludes the offsetting impact of the price risk inherent in the physical purchase of the underlying commodities. 43 Table of Contents
Removed
Exposures are related to the United States Dollar primarily relative to the Brazilian Real, Indian Rupee, Chinese Yuan, Hong Kong Dollar, South Korean Won, and the European Euro exchange rates. Also, there are additional exposures related to the European Euro primarily versus the Polish Złoty, British Pound Sterling, and the U.S. Dollar.
Added
In addition, exposures in European Euro primarily relate to the Polish Złoty, Danish Krone and the U.S. Dollar. These transactional risks are mitigated through the use of derivative financial instruments and balancing of cash deposits and loans.
Removed
As of December 31, 2023, the potential change in fair value for such financial instruments from an increase (decrease) of 10% in the quoted foreign currency exchange rates would be a (decrease) increase of approximately $4 million and $3 million, respectively.
Added
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK (continued) Commodity Price Risk The Company is exposed to changes in prices of commodities used in its operations, primarily associated with energy, such as natural gas, and raw materials, such as asphalt and polystyrene.
Removed
As of December 31, 2023, the Company had no borrowings on its Senior Revolving Credit Facility or Receivables Securitization Facility, with the balance of other floating-rate debt of $1 million.
Removed
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK (continued) The fair market value of the Company’s senior notes are subject to interest rate risk.
Removed
At December 31, 2023 and 2022, the net fair value of such swap contracts was a liability of $15 million and a liability of $30 million, respectively.
Removed
The potential change in fair value at December 31, 2023 and 2022 resulting from an increase (decrease) of 10% in the underlying commodity prices would be an increase (decrease) of $4 million for 2023 and an increase (decrease) of $8 million for 2022.

Other OC 10-K year-over-year comparisons