Company: MTZ
Filing Date: 2025-10-30
Form Type: 10-Q
Source: 0000015615-25-000128
Chunk: 244

Company: MASTEC INC
Filing Date: 2025-10-30
Form: 10-Q
Item: Part I, Item 4
Chunk 244
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 2025, and we expect to incur approximately $215 million of equipment purchases under finance leases and other financing arrangements.  Actual capital expenditures may increase or decrease in the future depending upon business activity levels, as well as ongoing assessments of equipment lease and other financing arrangements versus purchase decisions based on management’s evaluation of short and long-term equipment requirements.

Acquisitions and Earn-Out Liabilities.  We typically utilize cash for business acquisitions and other strategic arrangements.  In addition, in most of our acquisitions, we have agreed to make future payments to the sellers that are contingent upon the future earnings performance of the 

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acquired businesses, which we also refer to as “Earn-out” payments.  From time to time, our acquisitions may contain certain additional payments if specified conditions are met.  Earn-out payments may be paid in cash or, under specific circumstances, MasTec common stock, or a combination thereof, generally at our option.  The estimated total value of future Earn-out liabilities as of September 30, 2025 was approximately $85 million.  Of this amount, approximately $41 million represents the liability for earned amounts.  The remainder is management’s estimate of Earn-out liabilities that are contingent upon future performance.  For the nine months ended September 30, 2025 and 2024, payments related to our Earn-out liabilities totaled $25 million and $26 million, respectively.

Income Taxes.  For the nine months ended September 30, 2025 and 2024, tax payments, net of tax refunds totaled approximately $37 million and $45 million, respectively.  Our tax payments vary with changes in taxable income and earnings based on estimates of full year taxable income activity and estimated tax rates.

Working Capital.  We need working capital to support seasonal and other variations in our business, primarily related to the effects of weather conditions on outdoor construction and maintenance work and the spending patterns of our customers, both of which influence the timing of associated spending to support customer demand.  Working capital needs are generally higher during the summer and fall months due to increased demand for our services when favorable weather conditions exist in many of the regions in which we operate.  Conversely, working capital needs are typically converted to cash during the winter months.  These seasonal trends, however, can be offset by changes in the timing of projects, which can be affected by project delays or accelerations and/or other factors that may affect customer spending.

Working capital requirements also tend to increase when we commence multiple projects or particularly large projects because