Company: MTZ
Filing Date: 2025-10-30
Form Type: 10-Q
Source: 0000015615-25-000128
Chunk: 41

Company: MASTEC INC
Filing Date: 2025-10-30
Form: 10-Q
Item: Part I, Item 1
Chunk 41
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 Company is required to post letters of credit for its insurance carriers and surety bond providers and in support of performance under certain contracts as well as certain obligations associated with the Company’s equity investments and other strategic arrangements, including its VIEs.  In addition, from time to time, certain customers require the Company to post letters of credit to ensure payment of subcontractors and vendors, and guarantee performance under contracts.  Such letters of credit are generally issued by a bank or similar financial institution.  The letter of credit commits the issuer to pay specified amounts to the holder of the letter of credit under certain conditions.  If this were to occur, the Company would be required to reimburse the issuer of the letter of credit, which, depending upon the circumstances, could result in a charge to earnings.  As of September 30, 2025 and December 31, 2024, there were $54.2 million and $81.7 million, respectively, of letters of credit issued under the Company’s credit facilities.  Letter of credit claims have historically not been material.  The Company is not aware of any material claims relating to its outstanding letters of credit as of September 30, 2025 or December 31, 2024.Performance and Payment Bonds.  In the ordinary course of business, MasTec is required by certain customers to provide performance and payment bonds for contractual commitments related to its projects.  These bonds provide a guarantee to the customer that the Company will perform under the terms of a contract and that the Company will pay its subcontractors and vendors.  If the Company fails to perform under a contract or to pay its subcontractors and vendors, the customer may demand that the surety make payments or provide services under the bond.  The Company must reimburse the surety for expenses or outlays it incurs.  As of September 30, 2025 and December 31, 2024, outstanding performance and payment bonds approximated $9.4 billion and $7.6 billion, respectively, and estimated costs to complete projects secured by these bonds totaled $3.2 billion and $2.2 billion, respectively.  Included in these balances as of September 30, 2025 and December 31, 2024 are $1.3 billion and $838.7 million, respectively, of outstanding performance and payment bonds issued on behalf of the Company’s proportionately consolidated non-controlled contractual joint ventures, representing the Company’s proportionate share of the total bond obligation for the related projects