Company: MTZ
Filing Date: 2025-02-28
Form Type: 10-K
Source: 0000015615-25-000021
Chunk: 109

Company: MASTEC INC
Filing Date: 2025-02-28
Form: 10-K
Item: Item 4
Chunk 109
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 taking into consideration the risks inherent within each reporting unit individually.  Significant assumptions used in testing the reporting units included terminal values based on a terminal growth rate of 3.0%, five to seven years of discounted cash flows prior to the terminal value, including revenue growth and EBITDA margin assumptions, and discount rates ranging from 9.5% to 11.0%.

Based on the results of the quantitative assessments, the estimated fair values of all of the tested reporting units were determined to substantially exceed their carrying values.  A 100 basis point increase in the discount rate would not have resulted in any of the tested reporting units’ carrying values exceeding their fair values.

As of December 31, 2024, we believe that the recorded balances of goodwill and intangible assets are recoverable; however, adverse changes in the assumptions or estimates used in our analyses, such as a reduction in profitability and/or cash flows, changes in market, regulatory or other conditions, including decreases in project activity levels and/or the effects of elevated levels of inflation, interest rates or other regulatory or market disruptions, including from geopolitical events and/or changes in asset characteristics, could result in non-cash goodwill and/or intangible asset impairment charges in future periods.  See Note 1 - Business, Basis of Presentation and Significant Accounting Policies and Note 3 - Acquisitions, Goodwill and Other Intangible Assets, Net in the notes to the audited consolidated financial statements, which are incorporated by reference, for additional discussion.

Self-Insurance

We are self-insured up to the amount of our deductible for our insurance policies.  We also manage certain of our insurance liabilities indirectly through our wholly-owned captive insurance company, which reimburses claims up to the applicable insurance limits.  Liabilities under our insurance programs are accrued based upon our estimate of the ultimate liability for claims, with assistance from third-party actuaries.  The determination of such claims and expenses and the appropriateness of the related liability is reviewed and updated quarterly.  These insurance liabilities are, however, difficult to assess and estimate due to many factors, the effects of which are often unknown or difficult to estimate, including the severity of an injury or an incident, the determination of our liability in proportion to other parties and the number of incidents not reported.  Accruals are based upon known facts, historical trends and claims experience, loss development patterns and other actuarial assumptions.  Although we believe such accruals are adequate, a change in experience or actuarial or management assumptions could materially