Company: MTZ
Filing Date: 2025-07-31
Form Type: 10-Q
Source: 0000015615-25-000079
Chunk: 78

Company: MASTEC INC
Filing Date: 2025-07-31
Form: 10-Q
Item: Part I, Item 1
Chunk 78
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 – Related Party Transactions in the notes to the consolidated financial statements in this Form 10-Q, which are incorporated by reference, and see Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in our 2024 Form 10-K for additional information related to our off-balance sheet arrangements.

Impact of Inflation

Over the past years, inflation, supply chain and labor constraints have had a significant impact on the global economy, including on the construction industry in the United States.  As described above under “General Economic, Market and Regulatory Conditions,” there continues to be uncertainty as to the Federal Reserve’s future actions caused by dynamic market and trade conditions, as well as continuing concerns regarding the rate of inflation and employment levels.  In light of these conditions, we expect elevated market interest rates and continuing levels of cost inflation due, in part, to trade actions described above under “General Economic, Market and Regulatory Conditions,” for the foreseeable future.  Elevated levels of labor, material and fuel costs have negatively affected our project margins to the extent that we have been unable to pass such cost increases along to our customers.  If inflationary pressures persist, our profitability could continue to be affected in the future.  Market and economic volatility and/or uncertainty can also affect our customers’ investment decisions and subject us to project cancellations, deferrals or unexpected changes in the timing of project work.  

We closely monitor inflationary factors and any potential effects they may have on our business operations, operating results and/or financial condition.  While the impact of these factors cannot be fully eliminated, we proactively work to mitigate their effects; however, inflationary pressures and interest rate increases could adversely affect our business operations in the future.  For additional information regarding the effects of inflation on our business, see Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in our 2024 Form 10-K.

ITEM 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Risk

Our interest expense is affected by the prevailing interest rate environment.  While the cost of our variable debt fluctuates with changes in market interest rates, the interest on our fixed rate debt is unaffected by such changes.  We manage interest rate risk by maintaining a mix of fixed and variable rate debt obligations.  As of June 30, 2025, our variable interest rate debt was primarily related to our Credit Facility and 2025 Term Loan Facility.  As of June 30, 2025,