Company: MTZ
Filing Date: 2025-02-28
Form Type: 10-K
Source: 0000015615-25-000021
Chunk: 50

Company: MASTEC INC
Filing Date: 2025-02-28
Form: 10-K
Item: Item 2
Chunk 50
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 with non-cancelable operating leases with durations of less than twelve months, letter of credit obligations, surety and performance and payment bonds entered into in the normal course of business, self-insurance liabilities, liabilities associated with multiemployer pension plans, liabilities associated with potential funding obligations and indemnification and/or guarantee arrangements relating to our equity and other investment arrangements, including our variable interest entities.  These off-balance sheet arrangements have not had, and are not reasonably likely to have, a material impact on our financial condition, revenue or expenses, results of operations, liquidity, cash requirements or capital resources in the next twelve months or in the foreseeable future.  Refer to Note 4 - Fair Value of Financial Instruments, Note 14 - Commitments and Contingencies and Note 15 - Related Party Transactions in the notes to the audited consolidated financial statements, which are incorporated by reference, 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,” although the Federal Reserve decreased the Federal Funds rate periodically since September, 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, but moderating, levels of cost inflation for the foreseeable future.  The primary inflationary factors directly affecting our operations are labor, material and fuel costs.  The labor market remains at historically low levels of unemployment, creating pressure on the supply of skilled labor.  In times of low unemployment and/or high inflation, our labor costs may increase due to shortages in the supply of skilled labor and increases in compensation rates generally.  Immigration actions may also affect the availability of labor.  Although most project materials are provided by our customers, increases in the cost of materials could negatively affect the economic viability of our customers’ projects, and accordingly, demand for our services.  Material and commodity prices are subject to unexpected fluctuations due to events outside of our control, including fluctuations in global supply and demand, climate-related effects, and geopolitical events, such as military conflicts, including the Russia-Ukraine conflicts and the escalating tensions in the Middle East, and trade disputes, which events have caused market volatility and could create heightened global market volatility in the future.