EDGAR 10-K Filing

Company CIK: 1396009
Filing Year: 2025
Filename: 1396009_10-K_2025_0001396009-25-000005.json

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ITEM 1. BUSINESS
ITEM 1
BUSINESS
Vulcan Materials Company operates primarily in the U.S. and is the nation’s largest supplier of construction aggregates (primarily crushed stone, sand and gravel) and a major producer of aggregates-intensive downstream products such as asphalt mix and ready-mixed concrete. We provide the basic materials for the infrastructure needed to maintain and expand the U.S. economy. Delivered by trucks, ships, barges and trains, our products are the indispensable materials building homes, offices, places of worship, schools, hospitals and factories, as well as vital infrastructure including highways, bridges, roads, ports and harbors, water systems, campuses, dams, airports and rail networks. As of December 31, 2024, we had 423 active aggregates facilities as shown below.
Production and sales are currently halted at our Calica operations in Mexico. For additional information, see Note 12 “Commitments and Contingencies” in Item 8 “Financial Statements and Supplementary Data.”
Additionally, we further serve our customers through our 70 asphalt facilities and 74 concrete facilities located in Alabama, Arizona, California, Maryland, New Mexico, Tennessee, Texas, Virginia, the U.S. Virgin Islands and Washington D.C.
Our top ten revenue producing states accounted for 89% of our 2024 revenues while our top five accounted for 63%.
VULCAN’S TOP TEN REVENUE PRODUCING STATES IN 2024
1.California
6.Florida
2.Texas
7.Arizona
3.Georgia
8.South Carolina
4.Tennessee
9.North Carolina
5.Virginia
10.Alabama
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BUSINESS STRATEGY
Our strategy and competitive advantage are based on our strength in aggregates which are used in most types of construction and in the production of asphalt mix and ready-mixed concrete. Our strategy for long-term value creation is built on: (1) an aggregates-focused business, (2) an emphasis on durable growth, (3) a holistic approach to land management, and (4) our commitment to safety, health and the environment.
1.AGGREGATES FOCUS
Aggregates are an essential product with high barriers to entry, limited substitutes and very favorable pricing characteristics. Vulcan is uniquely positioned as the largest aggregates supplier in the U.S. and the most aggregates-focused public company.
Given our focus on aggregates, we:
▪TAKE ADVANTAGE OF SIZE AND SCALE: While certain aspects of each aggregates operation are unique, such as its location within a local market and its particular geological characteristics, every operation uses a similar group of assets to produce saleable aggregates and provide customer service. Our 423 active aggregates facilities as of December 31, 2024 provide opportunities to share and scale best practices across our operations and to procure equipment (fixed and mobile), parts, supplies and services in an efficient and cost-effective manner, both regionally and nationally. Additionally, we are able to leverage our size for administrative support, customer service, accounting, procurement, technical support and engineering.
▪BUILD AND HOLD SUBSTANTIAL RESERVES: Our reserves are critical to our long-term success. We currently have 16.5 billion tons of proven and probable aggregates reserves. They are strategically located to economically serve high-growth areas in the United States that are expected to require large amounts of aggregates to meet future construction demand. Moreover, there are significant barriers to entry in many metropolitan markets due to stringent zoning and permitting regulations. These restrictions curtail expansion in certain areas, but they also increase the value of our reserves at existing locations.
While aggregates are the core of our business, complementary aggregates-intensive asphalt and concrete products in select markets support our aggregates-driven returns throughout the cycle.
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Demand for our products is dependent on construction activity and correlates positively with changes in population, employment and household formations. As such, we have pursued a strategy to increase our presence in U.S. metropolitan areas that are expected to grow the most rapidly and to divest assets that are no longer considered part of our long-term growth strategy. During the next decade (2024 - 2034), Woods & Poole Economics projects that 76% of the U.S. population growth, 75% of new jobs and 74% of household formations will occur in Vulcan-served states. Our coast-to-coast footprint serves 35 of the top 50 highest-growth metropolitan statistical areas in 23 states plus Washington D.C. The close proximity of our aggregates reserves and our production facilities to this projected population growth creates many opportunities to invest capital in high-return projects.
Projected Demographic Growth, 2024 to 2034
in millions
Source: Woods & Poole Economics, Complete Economic and Demographic Data Source (CEDDS) 2024
2.DURABLE GROWTH
Our durable growth comes from organic growth in our existing business as well as inorganic growth through mergers and acquisitions supplemented with greenfield developments. Together, this three-pronged approach enables us to enhance our core and expand our reach. The result is an ability to grow our aggregates unit profitability throughout the cycle.
ENHANCING OUR CORE: We drive organic growth and differentiate ourselves from other aggregates producers through our strategic disciplines, the Vulcan Way of Selling (Commercial Excellence & Logistics Innovation) and the Vulcan Way of Operating (Operational Excellence & Strategic Sourcing). The Vulcan Way of Selling uses technology, innovation and analytics to win work and capture value. Custom, proprietary technology gives us real-time, forward-looking insight into all our end markets. Coaching and development of our people, along with clear performance metrics and accountability, drive sales execution. The Vulcan Way of Operating is the combination of tools, processes and approaches used by our teams to drive value in our operations every day. By focusing on consistent execution, production efficiency and controlling costs, we provide the highest quality material and the best service to our customers. Expanding on these strategic disciplines:
▪Commercial Excellence - We place great emphasis on the unique characteristics of each geographic market, and we interact with our customers accordingly. We leverage our coast-to-coast presence, sharing best practices and real-time, forward-looking metrics with our sales teams to drive high quality discussions, value selling and improved solutions for our customers. We have clearly defined roles and responsibilities which enable our sales teams to spend less time on non-selling activities and more time responding to our customers’ needs.
▪Logistics Innovation - Our industry-leading logistics team manages the shipments of nearly half of our products. Our logistics systems produce real-time information including on-site and mobile visibility to orders, deliveries and digital shipping records. Partnering with our customers (truck drivers and contractors), our bundled logistics solutions enable streamlined scheduling, speed and accuracy of delivery, as well as efficient back-office processes.
▪Operational Excellence - We strive for continuous and sustainable improvements in our operating disciplines and our industry-leading safety performance. Leveraging our size and diversity, we harness technology and innovation to equip our operators with the tools and information they need to improve our customer service, asset utilization and production efficiencies. We are dedicated to continuous improvement of our safety programs through ongoing internal inspections, regulatory audits and sharing of best practices.
▪Strategic Sourcing - We focus on value preservation and creation in our sourcing, leveraging our scale to save money across the organization while making sure our employees have the supplies and equipment they need. Deploying best practices and innovation allows us to spend more time in our plants and with our suppliers to deliver the right parts and services at the right time and optimize the total cost of ownership.
As a result of these strategic disciplines, from 2022 to 2024, aggregates gross profit per ton has increased from $5.96 to $8.26 (an increase of 39%), and aggregates cash gross profit per ton has increased from $7.83 to $10.61 (an increase of 36%). Aggregates cash gross profit per ton is a Non-GAAP financial measure. Non-GAAP financial measures are defined and reconciled within Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” under the caption “Reconciliation of Non-GAAP Financial Measures.”
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EXPANDING OUR REACH: We also drive growth by expanding our reach through mergers and acquisitions and by pursuing greenfield development in anticipation of future growth. Our disciplined approach focuses on aggregates, aims to achieve a number one or number two position in the fastest growing markets in the United States and strategically pursues downstream asphalt and concrete businesses complementary to our aggregates position in select markets.
Since becoming a public company in 1956, Vulcan has principally grown by mergers and acquisitions. In 1999, we acquired CalMat Co., thereby expanding our aggregates operations into California and Arizona and making us one of the nation’s leading producers of asphalt mix. In 2007, we acquired Florida Rock Industries, Inc., expanding our aggregates business in Florida and our aggregates and ready-mixed concrete businesses in other Mid-Atlantic and Southeastern states. In 2017, we acquired Aggregates USA, greatly expanding our ability to serve customers in Florida, Georgia and South Carolina. In 2021, we acquired U.S. Concrete, enhancing and expanding our aggregates-led business in attractive growing metropolitan areas. In 2024, we acquired Wake Stone Corporation (Wake Stone), which expanded our reach in high-growth geographies in the Carolinas, and Superior Ready Mix, L.P. (Superior), which solidified our position as the leading aggregates producer in Southern California. During the last 10 years, we have completed almost 40 acquisitions, including more than 75 aggregates quarries and sales yards in our top 10 revenue states.
While an aggregates-focused business, we selectively make investments in downstream asphalt and concrete products that drive local market profitability. Our downstream businesses use internally produced aggregates almost exclusively when available in the market from a Vulcan aggregates operation. Over the past ten years, we entered the asphalt markets in Tennessee and Alabama and also expanded our asphalt operations and services in Texas through acquisitions. Through our 2021 acquisition of U.S. Concrete, we entered the New Jersey, New York, Pennsylvania and U.S. Virgin Islands concrete markets and expanded our California, Texas and Washington D.C. concrete markets. To optimize our asset portfolio consistent with our aggregates-focused business model, we subsequently exited the New Jersey, New York and Pennsylvania concrete markets in 2022 and exited the Texas concrete market in 2023.
Additionally, throughout our history, we have completed many bolt-on aggregates and downstream acquisitions that have contributed significantly to our growth. In 2024, we completed two bolt-on acquisitions in Alabama and Texas, strengthening our position in two of our top 10 revenue states. From 2022 to 2024, we invested $2,890.8 million in acquisitions as outlined in Note 19 “Acquisitions and Divestitures” in Item 8 “Financial Statements and Supplementary Data.”
Our annual Return on Invested Capital (ROIC) decreased 0.1 percentage points (10 basis points) in 2024. Adjusted EBITDA increased 2% in 2024 and invested capital increased by 3%, primarily as a result of the fourth quarter acquisitions of Wake Stone and Superior.
1ROIC and Adjusted EBITDA are Non-GAAP financial measures. Non-GAAP financial measures are defined and reconciled within Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” under the caption “Reconciliation of Non-GAAP Financial Measures.”
3.LAND MANAGEMENT
With approximately 310,000 acres in our land portfolio, a long-term holistic approach to preserving land and water is integral to sustaining our success. From pre-mining to mining to reclamation, we are actively managing the entire life cycle of our land to create maximum value for the business, our shareholders and our communities.
We are putting land to use before we mine by creating opportunities such as agricultural use and timber development. After mining, our land and water assets will be converted to other valuable uses including drinking water reservoirs, aquifer recharge basins, public parks, habitat mitigation banks, wetlands, productive farmland and residential and commercial developments. In 2024, we sold real estate associated with a former sales yard in Virginia for net proceeds of $37.6 million resulting in a pretax gain of $36.7 million. In 2023, we sold excess real estate in Virginia for net proceeds of $66.1 million resulting in a pretax gain of $65.7 million and real estate associated with a former recycled concrete facility in Illinois for net proceeds of $16.5 million resulting in a pretax gain of $15.2 million. In 2022, we sold excess real estate in Southern California for net proceeds of $23.6 million resulting in a pretax gain of $23.5 million.
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Because of the evolving needs of our communities, we listen to and collaborate with our neighbors to prepare the land for its highest and best use. Many of our operations not only meet regulatory requirements for reclamation planning at the end of a quarry’s life but they also use a proactive approach to conservation and engagement while the quarries are in operation. For example, we originally purchased land in Polk County, Florida with the intention of building a quarry. However, after an extensive review of the environmental impacts to sensitive species, our environmental team collaborated with various governmental agencies to identify an alternative beneficial use for the land. The property became the Tiger Creek Conservation Bank and now serves as a protected habitat for endangered or sensitive species. Designation as a conservation bank allows us to generate revenue by selling mitigation credits for third party impacts to endangered or sensitive species or to utilize those credits for our impacts. Our engagement with state, regional and local governments to develop solutions like this today will benefit future generations.
4.SAFETY, HEALTH AND THE ENVIRONMENT
A strategy for sustainable, long-term value creation must include doing right by our employees, our neighbors and the environment in which we operate.
Our leadership recognized decades ago the significance and importance of leadership in the Safety, Health and Environmental areas. The Safety, Health and Environmental Affairs Committee of our Board of Directors, along with the full Board, has oversight responsibility for our safety, health and environmental programs and results. Our Safety, Health & Environmental Management Committee, made up of the senior leadership team along with other key senior personnel from cross-functional operations and staff disciplines, has the ongoing management responsibility for all of our safety, health and environmental initiatives. We are a leader in our industry in safety performance by applying the shared experiences, expertise and resources at each of our locally led sites with an emphasis on taking care of one another. In 2024, we experienced an overall Mine Safety and Health Administration (MSHA) safety performance of 1.2 injuries per 200,000 employee hours worked, which is well below the 2023 industry average of 1.8 injuries.
Our community relations programs serve our neighbors while ensuring that we grow and thrive in the communities where we operate. We leverage our charitable foundation and company funds to support food banks, healthcare services, childhood education remote learning programs and other initiatives designed to lessen the difficulties experienced in many of our communities. Our charitable foundation alone has provided over $70 million in support over the past 20 years to essential charitable, civic and educational organizations that strengthen and enrich our communities. In 2024, unprecedented extreme weather had a severe impact on our communities and operations. Most notably, Hurricane Helene caused extensive damage throughout the Southeast, impacting our teams in North Carolina, South Carolina, Tennessee and Georgia. In a time of great need, the true character and spirit of our Vulcan employees remained strong, and our teams lived out the Vulcan Way (doing the right thing, the right way, at the right time) to respond to the many challenges in the aftermath of the hurricane. Our operations have been directly involved in major restoration projects in the hardest hit areas to restore normalcy in the communities where we operate.
Our environmental stewardship commitment is designed to protect plant and animal species and habitats, as well as the air we breathe, the water we use and the planet we all share. In all parts of our company, from local operations to our corporate and regional offices to our international business and ocean-going shipping, we are focused on ensuring that our operations are efficient in ways that are economically and environmentally sustainable. As an example of our commitment to environmental stewardship, we have been a proud national partner of the Wildlife Habitat Council (WHC) since 1990 when our Sanders quarry became the first site in the U.S. to obtain certification by WHC. We currently maintain 33 WHC certified sites containing wildlife enhancement programs in addition to several other sites working towards certification. Our commitment to environmental stewardship is also demonstrated in the expansion of our renewable energy strategy. We have two additional solar projects planned in 2025, building upon the successful first year of solar facility operations at our San Emidio quarry in Bakersfield, California. We believe these projects will provide clean electricity to our operations while also benefiting the local electric grid through lessened reliance and supply of excess electricity from the facility back to the grid in peak hours. We are committed to growing our sourcing of renewable energy, reducing the carbon intensity of our products and improving energy resiliency.
In addition, the recycling of aggregates-containing construction materials including concrete and recycled asphalt pavement (RAP) is an important part of our business. The sources of these materials are highway, infrastructure and other demolition projects where concrete structures or asphalt paving is being removed. During 2024, we reused 2.1 million tons of RAP and recycled 1.7 million tons of concrete. The recycling of these aggregates-containing construction materials reduces carbon emissions that impact climate change while providing a valuable service to our customers and communities, extending the life of our aggregates reserves and helping us manage the cost of production.
For a discussion of our energy management and greenhouse gas emissions initiatives, see the Environmental Stewardship and Climate Change section later within this Item 1 under Other Business-Related Items.
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PRODUCT LINES
Our products are used to build the roads, tunnels, bridges, railroads and airports that connect us, and to build the homes, offices, hospitals, schools, shopping centers, factories and places of worship that are essential to our lives, our communities and the economy. We have three operating (and reportable) segments (Aggregates, Asphalt and Concrete) organized around our principal product lines. As a result of a first quarter 2024 change in our internal management reporting structure, our previously reportable calcium operation is now included within our Aggregates reporting segment. This change in our reporting segments had no impact on previously reported consolidated financial results.
As of December 31, 2024, we had 423 active aggregates facilities, 70 asphalt facilities and 74 concrete facilities. Our 2024 total revenues and gross profit by segment are illustrated as follows:
2024 Total Revenues
2024 Gross Profit
n Aggregates n Asphalt n Concrete
For actual amounts, see Note 15 “Segment Reporting” in Item 8 “Financial Statements and Supplementary Data.”
1.AGGREGATES
Our construction aggregates are used in a number of ways:
▪as a base material underneath highways, walkways, airport runways, parking lots and railroads
▪to aid in water filtration, purification and erosion control
▪as a raw material used in combination with other resources to construct many of the items we rely on to sustain our quality of life, including houses and apartments; roads, bridges and parking lots; schools and hospitals; commercial buildings and retail space; sewer systems; airports and runways; and power plants.
AGGREGATES INDUSTRY
Key strengths of the U.S. aggregates industry and our business include:
▪LOCATION AND TRANSPORTATION OF RESERVES: Aggregates have a high weight-to-price ratio that makes transportation expensive relative to the cost of the material. In most cases, aggregates are produced near where they are used so that the transportation cost does not exceed the product cost. Where practical, we have operations located close to our local markets because the cost of trucking materials long distances is prohibitive. Approximately 80% of our total aggregates shipments are delivered exclusively from the producing location to the customer by truck.
Exceptions to this typical market structure include areas along the U.S. Gulf Coast and the Eastern Seaboard where there are limited supplies of locally available, high-quality aggregates. We serve these markets from quarries that have access to cost-effective long-haul transportation, including shipping by barge, rail and our fleet of Panamax-class, self-unloading ships. Additionally, we serve markets in California and Hawaii from our quarry in British Columbia, Canada by means of a long-term marine shipping agreement with CSL Americas. Approximately 15% of our total aggregates shipments are delivered by truck to the customer after reaching a sales yard by rail or water. Less than 5% of aggregates shipments are delivered directly to the customer by rail or water.
▪LIMITED PRODUCT SUBSTITUTION: There are limited substitutes for quality aggregates. Recycled concrete and asphalt have certain applications as a lower-cost alternative to virgin aggregates. However, many types of construction projects cannot be served by recycled concrete and require the use of virgin aggregates to meet technical specifications and performance-based criteria for durability, strength and other qualities. Likewise, the amount of recycled asphalt included in asphalt mix as a substitute for aggregates is limited due to specifications.
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▪HIGHLY FRAGMENTED INDUSTRY: The U.S. aggregates industry is composed of over 5,800 companies that operated approximately 11,100 facilities during 2024. This fragmented structure provides many opportunities for consolidation. Companies in the industry commonly enter new markets or expand positions in existing markets through the acquisition of existing facilities.
Through strategic acquisitions and investments, we have developed an unmatched coast-to-coast footprint of strategically located permitted reserves concentrated in and serving the nation’s key growth centers. We have approximately 25,000 customers across the markets we serve.
▪FLEXIBLE PRODUCTION CAPABILITIES: The production of aggregates is a mechanical process in which stone is crushed and, through a series of screens, separated into various sizes depending on how it will be used. Direct production costs of aggregates primarily include: a) wages and fringe benefits; b) depreciation, depletion, accretion and amortization of capital (or long-term) assets; c) operating parts and supplies; d) repair and maintenance; e) third-party contracted services and f) energy (primarily electricity and diesel). Production capacity is flexible by adjusting operating hours to meet changing market demand. We are currently operating considerably below full capacity, making us extremely well positioned to further benefit from economies of scale when additional growth materializes.
▪RAW MATERIAL INPUTS LARGELY CONTROLLED: Unlike typical industrial manufacturing industries, the aggregates industry does not require the input of raw material beyond owned or leased aggregates reserves. Stone, sand and gravel are naturally occurring resources. However, production does require the use of explosives, hydrocarbon fuels and electric power.
▪DEMAND CYCLES: Long-term growth in demand for aggregates is largely driven by growth in population, jobs and households. While short-term and medium-term demand for aggregates fluctuates with economic cycles, declines have historically been followed by strong recoveries.
The drivers underpinning long-term demand and sustained pricing growth remain firmly in place in both the public and private sectors of the economy. They include: population growth; gains in total employment and in household income; a continuing increase in household formations; the growing need for additional housing stock; a multi-year federal transportation law in place and continuing increases in transportation funding at state and local levels; stable state tax receipts; and a multi-year federal infrastructure investment law and continued political awareness and focus on the need to invest in infrastructure.
AGGREGATES MARKETS
We focus on the U.S. markets with above-average long-term expected population growth and where construction is expected to expand. We produce and sell aggregates (crushed stone, sand and gravel, sand, and other aggregates) and related products and services in 23 states, the U.S. Virgin Islands, Washington D.C., Freeport (Bahamas), British Columbia (Canada), Puerto Cortés (Honduras) and Quintana Roo (Mexico) - see the NAFTA Arbitration section in Note 12 “Commitments and Contingencies” in Item 8 “Financial Statements and Supplementary Data.” We serve both the public and the private sectors.
Public sector construction activity has historically been more stable and less cyclical than private sector construction, and it generally requires more aggregates per dollar of construction spending. Private sector construction (primarily residential and nonresidential buildings) typically is more affected by general economic cycles than public sector projects (particularly highways, roads and bridges), which tend to receive more consistent levels of funding throughout economic cycles.
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PUBLIC SECTOR CONSTRUCTION MARKET
Public sector construction includes spending by federal, state and local governments for highways, bridges, buildings, airports, schools, prisons, sewer and waste disposal systems, water supply systems, dams, reservoirs and other public construction projects. Construction for power plants and other utilities is funded from both public and private sources. In 2024, publicly funded construction accounted for approximately 40% of our total aggregates shipments.
▪PUBLIC SECTOR FUNDING: Generally, public sector construction spending is more stable than private sector construction spending; public sector spending is less sensitive to interest rates and has historically been supported by multi-year laws, which provide certainty in funding amounts, program structures, rules and regulations. Federal spending is governed by authorization, budget and appropriations laws. The level of state and local spending on infrastructure varies across the United States and depends on individual state needs and economies.
▪STATE AND LOCAL TRANSPORTATION FUNDING: Since 2013, 33 states and the District of Columbia have increased or adjusted taxes on motor fuel to increase revenues available for transportation investment, including 14 Vulcan-served states and the District of Columbia. Several states in our footprint have variable-rate fuel taxes linked to measures of inflation, gas prices, population or motor vehicle fuel efficiency standards, including Alabama, California, Florida, Georgia, Illinois, Maryland, North Carolina, Virginia and the District of Columbia.
In addition, we benefit from state and local transportation funding ballot measures. In 2024, voters in 12 states approved measures which will generate over $45 billion in one-time and recurring revenues for transportation investment. Major transportation funding measures in Vulcan-served areas approved in 2024 are estimated to result in over $33 billion in revenues and bond proceeds primarily dedicated to roads, streets and bridges.
▪FEDERAL HIGHWAY FUNDING: In November 2021, President Biden signed a historic, bi-partisan infrastructure bill, the Infrastructure Investment and Jobs Act (IIJA), into law. The IIJA provides the largest increase in federal highway, road and bridge funding in more than six decades with a five-year reauthorization of Federal-Aid Highway Program funding. The total Federal-Aid Highway Program obligation limitation under IIJA started at $66.9 billion in Fiscal Funding Year (FFY) 2022 and increases to $72.1 billion in FFY 2026, for a cumulative total of nearly $350 billion.
These numbers include one-time additional funding for large road and bridge projects, such as $40 billion for bridge repair, replacement and rehabilitation. Of the bridge funds, approximately $16.2 billion is earmarked for projects in Vulcan-served states. Through September 30, 2024, states have committed highway and bridge formula funds to support over 85,000 new projects.
The FFY 2024 omnibus spending package fully funded the IIJA highway investment levels for FFY 2024. The long-term nature of the highway program reauthorization in the IIJA is important. The Federal-Aid Highway Program is the largest component of the law and has provided, on average, 50% of all state capital investment in roads and bridges over the last 10 years. This multi-year authorization and the associated dedicated funding provides state departments of transportation with the ability to plan and execute long-range, complex highway projects. In states where we operate, we are well positioned to serve the large general contractors who will compete for new freight and other major capacity projects that will move forward with IIJA and policy implementation.
Importantly, building on improvements in the two prior reauthorization laws - The Fixing America’s Surface Transportation Act (FAST Act) and Moving Ahead for Progress in the 21st Century Act (MAP-21) - the IIJA further streamlines project delivery and environmental approval advancements.
Project financing remains an important additional component of overall surface transportation spending. The IIJA expands access to private activity bonds for highway and intermodal projects and sets the Transportation Infrastructure Finance & Innovation Act (TIFIA) program authorized at $250 million per year.
▪ADDITIONAL FEDERAL PUBLIC INFRASTUCTURE INVESTMENTS UNDER THE IIJA: The IIJA allocates a total of approximately $1.2 trillion in federal funds for infrastructure investment, including almost $550 billion in new spending. A little more than half of the new money is dedicated to transportation sector projects. Beyond highway infrastructure, Vulcan is benefiting from IIJA-funded, aggregates-intensive infrastructure projects, such as railroads, airports, seaports, and drinking and wastewater systems.
▪FEDERAL WATER RESOURCES INFRASTRUCTURE: In December 2024, President Biden signed the Thomas R. Carper Water Resources Development Act of 2024 (WRDA 2024) into law, enacting the sixth consecutive biennial authorization for the U.S. Army Corps of Engineers (Army Corps) since 2014. WRDA 2024 reauthorizes needed investment in America’s ports, channels, locks, dams, and other infrastructure that supports the maritime and waterways transportation system. WRDA 2024 provides the Army Corps with authorization and funding for flood and coastal storm risk management and ecosystem restoration in support of resilience and sustainability. It also authorizes the Army Corps and United States Environmental Protection Agency’s (EPA) programs, which support drinking water, wastewater and storm management projects. Notably, WRDA 2024 includes a policy provision that increased the federal share of lock and dam construction and major rehabilitation project costs paid by the Inland Waterways Trust Fund (IWTF) from 65% to 75%, which reduces the non-federal share and enables the IWTF to help finance more projects.
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PRIVATE SECTOR CONSTRUCTION MARKET
The private sector construction markets include both nonresidential building construction and residential construction and are considerably more cyclical than public construction. In 2024, privately funded construction accounted for approximately 60% of our total aggregates shipments.
▪NONRESIDENTIAL CONSTRUCTION: Private nonresidential building construction includes a wide array of projects. Such projects generally are more aggregates intensive than residential construction. Overall demand in private nonresidential construction generally is driven by job growth, vacancy rates, private infrastructure needs and demographic trends. The growth of the private workforce creates demand for offices, hotels and restaurants. Likewise, population growth generates demand for stores, shopping centers, warehouses and parking decks as well as hospitals, places of worship and entertainment facilities. Large industrial projects, such as a new manufacturing facility, can increase the need for other manufacturing plants to supply parts and assemblies. Construction activity in this end market is influenced by a firm's ability to finance a project and the cost of such financing. This end market also includes capital investments in public nonresidential facilities to meet the needs of a growing population.
▪RESIDENTIAL CONSTRUCTION: Household formations in Vulcan-served states continue to outpace household formations in the rest of the United States. The majority of residential construction is for single-family housing with the remainder consisting of multi-family construction (i.e., two family houses, apartment buildings and condominiums). Public housing comprises only a small portion of housing demand. Construction activity in this end market is influenced by the cost and availability of mortgage financing and builders’ ability to maintain skilled labor.
U.S. housing starts, as measured by Dodge Data & Analytics, peaked in early 2006 at over 2 million units annually. By the end of 2009, total housing starts had declined to less than 0.6 million units, well below prior historical lows of approximately 1 million units annually. In 2024, total annual housing starts in the U.S. reached 1.5 million units.
ADDITIONAL AGGREGATES PRODUCTS AND MARKETS
We sell aggregates that are used as ballast for construction and maintenance of railroad tracks. We also sell riprap and jetty stone for erosion control along roads and waterways. In addition, stone can be used as a feedstock for cement and lime plants and for making a variety of adhesives, fillers and extenders. Coal-burning power plants use limestone in scrubbers to reduce harmful emissions. Limestone that is crushed to a fine powder can be sold as agricultural lime.
We sell a relatively small amount of construction aggregates outside of the United States, principally in the areas surrounding our aggregates production facilities located in Freeport, Bahamas; British Columbia, Canada; Puerto Cortés, Honduras; and Quintana Roo, Mexico (see the NAFTA Arbitration section in Note 12 “Commitments and Contingencies” in Item 8 “Financial Statements and Supplementary Data”). Nondomestic sales and long-lived assets outside the United States are reported in Note 15 “Segment Reporting” in Item 8 “Financial Statements and Supplementary Data.”
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VERTICAL INTEGRATION
While aggregates is our focus and primary business, we believe vertical integration between aggregates and downstream products, such as asphalt mix and ready-mixed concrete, can be managed effectively in certain markets to generate attractive financial returns and enhance financial returns in our core Aggregates segment. We produce and sell asphalt mix and/or ready-mixed concrete within each of our three geographic markets, as noted below.
Aggregates comprise approximately 95% of asphalt mix by weight and 80% of ready-mixed concrete by weight. In both of these downstream businesses, aggregates are primarily supplied from our operations.
2.ASPHALT
We produce and sell asphalt mix in Alabama, Arizona, California, New Mexico, Tennessee and Texas and provide asphalt construction paving services in Alabama, Tennessee and Texas. In 2022 and 2024, we strengthened our asphalt position in California and Texas by acquiring additional asphalt operations. For additional details, see Note 19 “Acquisitions and Divestitures” in Item 8 “Financial Statements and Supplementary Data.”
This segment relies on our reserves of aggregates, functioning essentially as a customer to our aggregates operations. Aggregates are a major component in asphalt mix, comprising approximately 95% by weight of this product. We meet the aggregates requirements for our Asphalt segment primarily through our Aggregates segment. These product transfers are made at local market prices for the particular grade and quality of material required.
Because asphalt mix hardens rapidly, delivery typically is within close proximity to the producing facility. The asphalt mix production process requires liquid asphalt cement, which we purchase from third-party producers. We do not anticipate any significant difficulties in obtaining the raw materials necessary for this segment to operate. We serve our Asphalt segment customers directly from our local production facilities.
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3.CONCRETE
We produce and sell ready-mixed concrete in California, Maryland, Virginia, the U.S. Virgin Islands and Washington D.C. We strengthened our concrete positions in California in 2024 and in Virginia and California in 2022 through acquisitions. In 2021, through our acquisition of U.S. Concrete, we entered the New Jersey, New York, Pennsylvania and U.S. Virgin Islands concrete markets and expanded our service of the California, Texas and Washington D.C. concrete markets. Subsequently, we took steps to optimize our asset portfolio consistent with our aggregates-focused business model and in 2023, we exited the Texas concrete market, and in 2022, we exited the New Jersey, New York and Pennsylvania concrete markets. For additional details, see Note 19 “Acquisitions and Divestitures” in Item 8 “Financial Statements and Supplementary Data.”
This segment relies on our reserves of aggregates, functioning essentially as a customer to our aggregates operations. Ready-mixed concrete consists of cement and other cement-related materials (such as fly ash and slag), aggregates (crushed stone and sand), chemical admixtures and water and is measured in cubic yards. Aggregates are a major component in ready-mixed concrete, comprising approximately 80% by weight of this product. We meet the aggregates requirements of our Concrete segment primarily through our Aggregates segment. These product transfers are made at local market prices for the particular grade and quality of material required.
Cement is the binding agent used to bind water, crushed stone and sand in the production of ready-mixed concrete. Other industrial byproducts, such as fly ash from coal burning power plants and slag from the manufacture of iron and silica fume, have cement-related properties that allow them to be used as substitutes for cement depending on the specifications. We purchase cement-related materials from a few suppliers in each of our major geographic markets. Chemical admixtures are generally purchased from suppliers under national purchasing agreements.
With the exception of chemical admixtures, each ready-mix facility typically maintains an inventory level of these raw materials sufficient to satisfy its operating needs for a few days. Inventory levels do not decline significantly or comparatively with declines in revenue during seasonally lower periods. We generally maintain inventory at specified levels to maximize purchasing efficiencies and to be able to respond quickly to customer demand.
Because ready-mixed concrete hardens rapidly, delivery typically is within close proximity to the producing facility. Ready-mixed concrete production also requires cement which we purchase from third-party producers. We do not anticipate any significant difficulties in obtaining the raw materials necessary for this segment to operate. We serve our Concrete segment customers from our local production facilities or by truck.
Part I 13
OTHER BUSINESS-RELATED ITEMS
SEASONALITY AND CYCLICAL NATURE OF OUR BUSINESS
Almost all of our products are produced and consumed outdoors. Seasonal changes and other weather-related conditions can affect the production and sales volumes of our products. Therefore, the financial results for any quarter do not necessarily indicate the results expected for the year. Normally, the highest sales and earnings are in the third quarter, and the lowest are in the first quarter. Furthermore, our sales and earnings are sensitive to national, regional and local economic conditions, demographic and population fluctuations, and particularly to cyclical swings in construction spending, primarily in the private sector.
COMPETITORS
We operate in a fragmented industry with a large number of small, privately-held companies. We estimate that the ten largest aggregates producers accounted for approximately 35% of the total U.S. aggregates production in 2024. Despite being the industry leader, Vulcan’s total U.S. market share is approximately 9%. As of December 31, 2024, other publicly traded companies among the ten largest U.S. aggregates producers include the following:
▪Arcosa, Inc.
▪Cemex S.A.B. de C.V.
▪CRH plc
▪Heidelberg Materials AG
▪Holcim Ltd.
▪Martin Marietta Materials, Inc.
▪Summit Materials, Inc.
Because the U.S. aggregates industry is highly fragmented, many opportunities for consolidation exist. Therefore, companies in the industry tend to grow by acquiring existing facilities to enter new markets or extend their existing market positions.
CUSTOMERS
No material part of our business depends upon any single customer whose loss would have a significant adverse effect on our business. In 2024, our five largest customers accounted for approximately 8% of our total revenues, and no single customer accounted for more than 3% of our total revenues. Although approximately 40% to 55% of our aggregates shipments have historically been used in publicly-funded construction, such as highways, airports and government buildings, a relatively small portion of our sales are made directly to federal, state, county or municipal governments/agencies. Therefore, although reductions in state and federal funding can curtail publicly-funded construction, the vast majority of our business is not directly subject to renegotiation of profits or termination of contracts with local, state or federal governments. In addition, our sales to government entities span several hundred entities coast-to-coast, ensuring that negative changes to various government budgets would have a muted impact across such a diversified set of government customers.
ENVIRONMENTAL STEWARDSHIP AND CLIMATE CHANGE
As an industry leader, we are and always have been committed to environmental stewardship which is necessary for our long-term sustainability and growth. Production of construction aggregates requires land, energy and water. Efficient use of these resources and management of the environmental impacts of our operations are embedded in our business planning. Our intentional approach to environmental stewardship also supports increased operational efficiency, cost reduction, new opportunities for growth and effective risk management.
We are committed to doing our part to reduce our greenhouse gas (GHG) emissions and to identifying, planning for, and mitigating physical and transitional climate risks to our business. Carbon dioxide and other GHG emissions from our operations are low: we are aggregates-focused and do not produce cement. Beginning in 2018, we chose to voluntarily report GHG emissions via the Carbon Disclosure Project. In 2022, we established interim goals and targets related to Scope 1 and 2 emissions. In 2024, we continued the second phase of our Scope 3 GHG emissions inventory project to further build the capacity to report on activities of assets not owned or controlled by Vulcan but that indirectly impact our value chain. We also enhanced our GHG emissions tracking and reporting capabilities in order to report Scope 1 and 2 emissions on an enterprise-wide basis by line of business and type of energy.
MANAGING ENERGY AND OPERATIONAL EFFICIENCY
Careful management of energy is embedded in our business strategy and our company culture. We routinely conduct energy audits of our operations to identify areas for operational efficiency improvements and energy savings. Some of the opportunities identified during these audits that are being implemented include: replacement of older motors with new ultra-high efficiency motors to power plant processing equipment; improvements in water handling systems to reduce water pumping needed; optimizing process equipment flow to maximize efficiency; reducing idle equipment hours; use of LED lighting; and optimization of air conditioning and lighting control to reduce energy consumption.
Part I 14
We continue to increase the fuel efficiencies of our off-road fleet vehicles. Tier IV machines performed over 64% of the off-road fleet’s work in 2024, which positively impacts all air emissions in addition to having an impact on GHG emissions.
Our strategy also includes producing low-embodied emissions products and supporting the construction of climate-resilient infrastructure. For example, our Concrete segment has licensed the CarbonCure technology that provides capture and sequestration of carbon dioxide within ready-mixed concrete. The carbon dioxide becomes chemically bound within the concrete matrix and is not released into the air, even when the concrete is recycled following use. This technology also reduces the demand for cement and other cement-related materials which reduces the supply side carbon footprint. The resulting concrete is also stronger than it would have been without use of the technology.
Scope 1 and Scope 2 GHG reductions will come by means of continuing heavy equipment replacement with higher efficiency models, seeking production efficiencies, and procuring energy from renewable sources. We are confident that there are many more opportunities to reduce the carbon footprint of our operations, distribution and transportation networks, and the projects in which our products are used. An example of an additional opportunity that we are exploring is the installation of battery storage for electricity at multiple locations so that energy can be stored during off peak periods to run the plant equipment, thereby minimizing peak load usage. This has significant implications for the ability of the utility company to meet peak demands and to reduce their use of older power plants that burn coal or oil and emit greater concentrations of GHG emissions.
ENVIRONMENTAL COSTS AND GOVERNMENTAL REGULATION
We are subject to a wide variety of federal, state and local laws and regulations in the communities where we conduct business. Compliance with these laws and regulations often requires the time and effort of our employees, as well as financial resources. The following describes certain significant regulations that may impact our business. For additional information about our risks related to government regulations, see Item 1A “Risk Factors.”
Our operations are subject to numerous laws and regulations relating to the protection of the environment and worker health and safety including regulation of facility air emissions and water discharges, waste management, protection of wetlands, listed and threatened species, noise and dust exposure control for workers, and safety regulations under both Mine Safety and Health Administration (MSHA) and Occupational Safety and Health Administration (OSHA). Compliance with these various regulations requires capital investment and ongoing expenditures for the operation and maintenance of systems and implementation of programs. These anticipated investments and expenditures are not material to our earnings or competitive position.
We have received notices from the EPA or similar state or local agencies that we are considered a potentially responsible party (PRP) at a limited number of sites under the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA or Superfund) or similar state and local environmental laws. Generally, we share the cost of remediation at these sites with other PRPs or alleged PRPs in accordance with negotiated or prescribed allocations. There is inherent uncertainty in determining the potential cost of remediating a given site and in determining any individual party's share of that cost. As a result, estimates can change substantially as additional information becomes available about the nature or extent of site contamination, remediation methods, other PRPs and their probable level of involvement, and actions by or against governmental agencies or private parties.
Frequently, we are required by state and local regulations or contractual obligations to reclaim our former mining sites. These reclamation liabilities are recorded at fair value in our financial statements at the time the obligation arises. To determine the fair value, we estimate the cost for a third party to perform the legally required reclamation, which is adjusted for inflation and risk and includes a reasonable profit margin. Reclaimed quarries often have potential for use in commercial or residential development or as reservoirs or landfills. However, no projected cash flows from these anticipated uses have been considered to offset or reduce the estimated reclamation liability.
For additional information about environmental matters and reclamation obligations, see Note 12 and Note 17, respectively, to the consolidated financial statements in Item 8 “Financial Statements and Supplementary Data.”
HUMAN CAPITAL
As of January 1, 2025, we employed 11,436 people in the United States. Of these employees, 1,092 are represented by labor unions. Also, as of that date, we employed 313 people in Mexico, 149 people in Honduras, 72 people in Canada, and 1 person in the Bahamas. Of these employees, 248 are represented by labor unions. We believe we enjoy a satisfactory relationship with our employees, including our unionized workforce, and we do not anticipate any significant issues with any unions in 2025.
Vulcan’s commitment to our people has played a key role in the ongoing success and growth of our company throughout our long history. We are dedicated to fostering a culture of mutual respect, integrity, teamwork and trust among our workforce. Our employees receive tools and cutting edge, customized safety and health, technical, managerial and leadership training to enable them to perform safely and effectively. Our people share a competitive drive to be the best they can be and do the right thing, which benefits all of our stakeholders.
In 2024, we celebrated the tenth anniversary of The Vulcan Way. Inclusion has been one of the ten tenets of The Vulcan Way since its adoption. Our focus on inclusion fosters a positive work environment and enables Vulcan to attract, grow and retain talented employees while promoting unity of purpose. We are committed to a culture that values diverse styles, ideas, and perspectives. We believe that success is achieved when all individuals are represented, valued and included at all levels.
Part I 15
We believe that learning is fundamental to every job, and we encourage our people to expand and explore their capabilities for continued growth throughout their careers with Vulcan. Our industry-leading training and development programs encourage collaboration and enable people to innovate and flourish on the job and in the community. These programs:
▪Provide our employees with a Tuition Reimbursement Program, which pays up to 100% of tuition costs based on academic performance
▪Encourage personal and professional growth through our mentoring program
▪Prepare future senior-level leaders through our Leadership Development Program in partnership with the University of North Carolina, Chapel Hill
▪Offer mini MBA programs and other continuing education opportunities
▪Deliver ongoing Vulcan Way of Operating technical and skills-based training modules
▪Provide ongoing management and soft skill training through the Plant Manager Engagement Series
Employee Tenure
in years
Employees by Age
in years
Workforce by Race and Ethnicity
Salaried Non-Exempt Employees
by Gender
Part I 16
SHAREHOLDER RETURN PERFORMANCE
Below is a graph comparing the performance of our common stock, with dividends reinvested, to that of the Standard & Poor’s 500 Stock Index (S&P 500) and the S&P 500 Materials Index (S&P 500 Materials) from December 31, 2019 to December 31, 2024.
2019 2020 2021 2022 2023 2024
Comparative Total Return 1
Vulcan Materials Company $100.00 $104.20 $147.03 $125.12 $163.53 $186.59
S&P 500 $100.00 $118.40 $152.38 $124.80 $157.62 $197.03
S&P 500 Materials $100.00 $120.70 $153.65 $134.75 $151.60 $151.60
1Assumes an initial investment at December 31, 2019 of $100 in each stock/index, with quarterly reinvestment of dividends.
Part I 17
INVESTOR INFORMATION
We make available on our website, www.vulcanmaterials.com, free of charge, copies of our:
▪Annual Report on Form 10-K
▪Quarterly Reports on Form 10-Q
▪Current Reports on Form 8-K
Our website also includes amendments to those reports filed with or furnished to the Securities and Exchange Commission (SEC) pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 as well as all Forms 3, 4 and 5 filed with the SEC by our executive officers and directors, as soon as the filings are made publicly available by the SEC on its EDGAR database (www.sec.gov).
In addition to accessing copies of our reports online, you may request a copy of our Annual Report on Form 10-K, including financial statements, by writing to Denson N. Franklin III, Senior Vice President, General Counsel and Secretary, Vulcan Materials Company, 1200 Urban Center Drive, Birmingham, Alabama 35242.
We have a:
▪Business Conduct Policy applicable to all employees and directors
▪Code of Ethics for the CEO and Senior Financial Officers
Copies of the Business Conduct Policy and the Code of Ethics are available on our website under the “Investor Relations” tab (“Governance” section). If we make any amendment to, or waiver of, any provision of the Code of Ethics, we will disclose such information on our website as well as through filings with the SEC.
Our Board of Directors has also adopted:
▪Corporate Governance Guidelines
▪Charters for our Audit, Compensation & Human Capital, Executive, Finance, Governance and Safety, Health & Environmental Affairs Committees
These documents meet all applicable SEC and New York Stock Exchange (NYSE) regulatory requirements.
The Charters of the Audit, Compensation & Human Capital and Governance Committees are available on our website under the “Investor Relations” tab (“Governance - Committee Composition” section) or you may request a copy of any of these documents by writing to Denson N. Franklin III, Senior Vice President, General Counsel and Secretary, Vulcan Materials Company, 1200 Urban Center Drive, Birmingham, Alabama 35242.
Information included on our website is not incorporated into, or otherwise made a part of, this report.
CERTIFICATIONS AND ASSERTIONS
The certifications of our Chief Executive Officer and Chief Financial Officer made pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 are included as exhibits to this Annual Report on Form 10-K. Additionally, on June 10, 2024 our Chief Executive Officer submitted to the NYSE the annual written affirmation required by the rules of the NYSE certifying that he was not aware of any violations of Vulcan Materials Company of NYSE corporate governance listing standards.
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ITEM 1A. RISK FACTORS
ITEM 1A
RISK FACTORS
The following risks could materially and adversely affect our business, financial condition and results of operations, and cause the trading price of our common stock to decline. This list does not identify all risks that we face; our operations could also be affected by factors that are not presently known to us or that we currently consider to be immaterial. Due to risks and uncertainties, known and unknown, our past financial results may not be a reliable indicator of future performance, and historical trends should not be used to anticipate results or trends in future periods. You should also refer to the other information set forth in this Annual Report on Form 10-K, including Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Item 8 “Financial Statements and Supplementary Data.”
ECONOMIC/POLITICAL RISKS
Our business is dependent on the construction industry and is subject to economic cycles - Our products are principally sold to the U.S. construction industry. Construction spending is affected by general economic conditions, changes in interest rates, demographic shifts, industry cycles, employment levels, inflation and other business, economic and financial factors, any of which could contribute to a downturn in construction activities or spending in Vulcan-served markets. A downturn in Vulcan-served markets, particularly in our top revenue-generating markets, could have a material adverse effect on our business, financial condition and results of operations.
Our business is dependent on the timing and amount of federal, state and local funding for infrastructure - Our products are used in a variety of public infrastructure projects that are funded and financed by federal, state and local governments. In November 2021, the federal Infrastructure Investment and Jobs Act (IIJA), which included a five-year road, bridge and public transportation program reauthorization at record levels, was signed into law. This federal highway program, as well as funding for other aggregates-intensive public infrastructure, will support demand for our products for several years to come. However, given the time to set up new federal programs, varying state and local budgetary situations and the stages of projects, we cannot be entirely assured of the existence, amount and timing of appropriations for future public infrastructure projects.
We are subject to various risks arising from our international business operations and relationships - We are subject to risks associated with potential disruption caused by changes in domestic or global political, economic and diplomatic developments, including war, civil and political unrest, illnesses declared as a public health emergency (including viral pandemics such as COVID-19), terrorism, expropriation and local labor conditions. We are also subject to both the risks of conducting international business and the requirements of the Foreign Corrupt Practices Act of 1977 (the FCPA) associated with our aggregates production facilities including those located in British Columbia, Canada; Puerto Cortés, Honduras; and Quintana Roo, Mexico. These risks have included, and may in the future include, changes in international trade policies, such as the United States - Mexico - Canada Agreement (USMCA), imposition of duties, tariffs, taxes or government royalties, arbitrary changes to permits, zoning classifications or operating agreements, or overt acts by foreign governments, including expropriations and other forms of takings of property. Recently, the Mexican government has taken actions that adversely affect our property and operations in Mexico, including arbitrary shutdown orders to immediately cease underwater quarrying and extraction operations. We continue to vigorously pursue all lawful avenues available to us in order to protect our rights, under both Mexican and international law.
OPERATIONS, GROWTH AND COMPETITIVE RISKS
Within our local markets, we operate in a highly competitive industry - The construction aggregates industry is highly fragmented with a large number of independent local producers in a number of our markets. Additionally, in most markets, we also compete against large private and public companies, some of which are significantly vertically integrated. This significant competition or any unfavorable change in competitive circumstances in our markets could lead to lower prices and lower sales volumes.
Certain markets are experiencing the expanded use of aggregates substitutes - Recycled concrete and asphalt are increasingly being used in a number of our markets, particularly urban markets, as a substitute for aggregates. The expanded use of recycled concrete and asphalt could cause a significant reduction in the demand for aggregates.
Our long-term success depends upon securing and permitting aggregates reserves in strategically located areas - Construction aggregates have a high weight-to-price ratio, and transportation costs can quickly exceed the cost of the aggregates. Therefore, except for geographic regions that do not possess commercially viable deposits of aggregates and are served by rail, barge or ship, the markets for our products tend to be localized around our quarry sites and are served by truck. New quarry sites often take years to develop, so our strategic planning and new site development must stay ahead of actual growth. Additionally, in a number of urban and suburban areas in which we operate, it is increasingly difficult to permit new sites or expand existing sites due to community resistance. Therefore, our future success is dependent, in part, on our ability to accurately forecast future areas of high growth in order to locate optimal facility sites and on our ability to secure operating and environmental permits to operate at those sites.
Our future growth depends in part on acquiring and successfully integrating other businesses in our industry - Our ability to acquire and integrate businesses is dependent upon the availability of attractive businesses with owners that are willing to sell at fair market prices, conducting proper due diligence on such available businesses, developing and executing integration plans for acquired businesses, and retaining the customers and partners of acquired businesses following their acquisition. If we are not successful with respect to those matters, we may not realize the anticipated benefits associated with such acquisitions, which could adversely affect our business and results of operations.
Part I 19
Our aggregates operations are subject to the risks of open pit and underground mining - Aggregates mining involves risks such as pit wall failures, pillar or ceiling collapse, flooding, and seismic events related to geologic conditions and our mining activities. Any ground control event could lead to serious injuries, loss of life, equipment damage, production delays or cessation, and increased operating costs.
FINANCIAL/ACCOUNTING RISKS
Our industry is capital intensive, resulting in significant fixed and semi-fixed costs - Due to the high levels of fixed capital required for extracting and producing construction aggregates, our earnings are highly sensitive to changes in product shipments. Therefore, it is important that our capital allocation decisions are properly informed and our capital deployment is well planned and executed. Any decrease in product shipments or an inability to generate sufficient cash to execute our capital deployment may adversely affect our financial condition and results of operations.
A deterioration in our credit ratings and/or the state of the capital markets could negatively impact the cost and/or availability of financing - We currently have approximately $5.3 billion of debt with maturities between 2025 and 2054. We expect to finance acquisitions with a combination of cash flows from existing operations, additional debt and/or additional equity. The mix of financing sources for acquisitions will be situationally dependent.
A deterioration in our credit ratings, regardless of the cause, could limit our debt financing options and increase the cost of such debt financing. While we do not anticipate a credit ratings downgrade and plan to manage our capital structure consistent with investment-grade credit metrics, we cannot assure our current credit ratings.
A deterioration in the state of the capital markets, regardless of our credit ratings, could impact our access to and/or cost of new debt or equity capital.
We use estimates in accounting for a number of significant items - As discussed more fully in “Critical Accounting Policies” under Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” we use estimates and assumptions that require significant judgment in accounting for the following items:
▪goodwill impairment
▪impairment of long-lived assets excluding goodwill
▪business combinations and purchase price allocation
▪pension and other postretirement benefits
▪environmental compliance costs
▪claims and litigation including self-insurance
▪income taxes
Additionally, the calculation of mineral resources and reserves are estimates and depend upon geological interpretation and statistical inferences or assumptions drawn from drilling and sampling analysis. These estimates are subject to uncertainty due to factors that include the inherent variability of the deposit and recoverability of saleable material in the mining process. If we used different estimates and assumptions or used different ways to determine these estimates, our financial results could differ.
These estimates and assumptions could change significantly in the future and could adversely affect our financial position, results of operations or cash flows.
Our effective tax rate is subject to change - Factors that may increase our future effective tax rate include, but are not limited to: governmental authorities increasing statutory income tax rates or eliminating deductions (particularly the depletion deduction) or credits; the mix of jurisdictions in which our earnings are taxed and the mix of earnings from depletable versus non-depletable businesses; changes in the valuation of our deferred tax assets and liabilities; the effect our stock price has with regard to excess tax benefits from share-based compensation; adjustments to estimated taxes upon finalization of various income tax returns; the resolution of issues arising from income tax audits with various tax authorities; and the interpretation of income tax laws and/or administrative practices.
LEGAL/REGULATORY COMPLIANCE RISKS
Our operations are subject to changes in legal requirements and governmental policies - Our operations are affected by numerous federal, state and local laws and regulations, including those related to zoning, land use and environmental matters. In addition, our operations require numerous governmental approvals and permits, which often require us to make significant capital and operating expenditures to comply with the applicable requirements. Stricter laws and regulations, or more stringent interpretations of existing laws or regulations, may impose new liabilities, taxes or tariffs on us; reduce operating hours; require additional investment by us in pollution control equipment; create restrictions on our products; impede our access to reserves or hamper the opening of new, or the expansion of existing, plants or facilities.
We are involved in certain environmental matters and other legal proceedings - We are involved in environmental investigations and cleanups at sites that we own or owned, where we operate or have operated or where we sent materials for recycling or disposal, as well as related offsite investigations and cleanups. We are also involved in several other complex, non-environmental, legal proceedings. As required by GAAP, we establish reserves when a loss is determined to be probable and the amount can be reasonably estimated. Our assessment of probability and loss estimates are based on the facts and circumstances known to us at a particular point in time. Subsequent developments related to these matters may affect our assessment and estimates of loss contingency. For a description of our current significant legal proceedings and environmental matters, see Note 12 “Commitments and Contingencies” in Item 8 “Financial Statements and Supplementary Data.”
Part I 20
Climate change legislation or regulations may adversely impact our business - A number of governmental bodies have introduced or are contemplating legislative and regulatory change in response to the potential impacts of climate change. Such legislation or regulation, if enacted, potentially could include provisions for a “cap and trade” system of allowances and credits or a carbon tax, among other provisions, and adversely impact the availability and/or cost of purchased electricity.
Expectations relating to environmental, social and governance considerations and related reporting obligations expose us to potential liabilities, increased costs, reputational harm and other adverse effects on our business - Many governments, regulators, investors, employees, customers and other stakeholders are increasingly focused on environmental, social and governance considerations relating to businesses, including climate change and greenhouse gas emissions, and human capital matters. In addition, we make statements about our sustainability goals and initiatives through our sustainability report, our other non-financial reports, information provided on our website, press releases and other communications. Responding to these environmental, social and governance considerations and implementing these goals and initiatives involves risks and uncertainties, requires investments, and depends in part on third-party performance or data that is outside our control. We cannot guarantee that we will achieve our announced sustainability goals and initiatives. In addition, some stakeholders may disagree with our goals and initiatives. Any failure, or perceived failure, by us to achieve our goals, further our initiatives, adhere to our public statements, comply with related federal, state or international laws and regulations, or meet evolving and varied stakeholder expectations and standards could result in legal and regulatory proceedings against us.
We may incur material costs and losses as a result of claims that our products do not meet regulatory requirements or contractual specifications - Our operations involve providing products that must meet building code or other regulatory requirements and contractual specifications for durability, stress-level capacity, weight-bearing capacity and other characteristics. If we fail to provide products meeting these requirements and specifications, product liability claims may arise against us. We have resolved certain claims of this kind, but there are currently open claims, and we expect future claims, some of which may exceed our product liability insurance coverage.
PERSONNEL RISKS
Our future success depends upon attracting and retaining qualified personnel, particularly in sales and operations - Our success in attracting qualified personnel, particularly in the areas of sales and operations, is affected by changing demographics of the available pool of workers with the training and skills necessary to fill the available positions, the impact on the labor supply due to general economic conditions, and our ability to offer competitive compensation and benefit packages.
Disputes with organized labor could disrupt our business operations - Labor unions represent approximately 11% of our workforce. Disputes with our trade unions, or the inability to renew our labor agreements, may lead to strikes or other actions that could disrupt our business operations.
GENERAL RISK FACTORS
We are dependent on information technology systems (our own and those of our service providers such as Amazon Web Services), and these systems contain non-public data about our business, employees, suppliers and customers - The protection of our information technology systems and the data contained therein is critical to us. We have a dedicated information security team that executes our information security program and routinely tests the security of our applications, networks, databases, etc. While we have security measures and technology in place designed to protect proprietary or classified information about our business, employees, suppliers and customers, there can be no assurance that our efforts will prevent all threats to our information technology systems (or those of our service providers). In addition, the rapid evolution and increased adoption of artificial intelligence and machine learning technologies may intensify our cybersecurity risks. Because the techniques used to obtain unauthorized access or sabotage information technology systems change frequently, become more sophisticated and generally are not identified until they are launched against a target, we may be unable to anticipate these techniques or implement adequate preventative measures. The loss of use of information technology systems (whether ours or our service providers), regardless of the cause, could disrupt our business operations. The failure to keep secure the confidential and sensitive data about our business, employees, suppliers and customers (regardless of the reason for such failure) or failure by us to comply with applicable laws, rules or regulations could expose us, our employees, suppliers and/or our customers to the misuse of such data and could damage our reputation, cause us to incur significant liability and have a material adverse effect on our business, financial condition and results of operations.
Weather can, and climate change may, materially affect our operations - Almost all of our products are consumed outdoors in the public or private construction industry, and our production and distribution facilities are located outdoors. Inclement weather affects both our ability to produce and distribute our products and affects our customers’ short-term demand because their work also can be hampered by weather. Potential impacts of climate change include disruption in production and product distribution due to impacts from major storm events, shifts in regional weather patterns and intensities, availability of energy and/or water, and sea level changes. A number of our facilities are located in desert climates, and while we have not experienced any significant shortages of energy or water in the past, we cannot guarantee that we will not in the future. Furthermore, public expectations for addressing climate change could result in increased energy, transportation and raw material costs and may require us to make additional investments in facilities and equipment.
Our product distribution is multi-modal and often dependent upon third-party providers - Our products are distributed either by truck to local markets or by rail, barge or oceangoing vessel to remote markets. The distribution and cost of distribution could be negatively affected by factors such as rail service interruptions or rate increases, tariffs, rising fuel costs, truck/railcar/barge shortages, truck driver and rail crew shortages, capacity constraints and minimum tonnage requirements.
Part I 21
The production of our products is dependent upon the supply chain for several key inputs - In our production and distribution processes, we consume significant amounts of electricity, diesel fuel, liquid asphalt and other petroleum-based resources. Additionally, we operate significant amounts of fixed and mobile equipment that require regular maintenance and replacement of parts. The availability and pricing of these resources are subject to market forces.

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ITEM 1B. UNRESOLVED STAFF COMMENTS
ITEM 1B
UNRESOLVED STAFF COMMENTS
We have not received any written comments from the Securities and Exchange Commission staff regarding our periodic or current reports under the Exchange Act of 1934 that remain unresolved.
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ITEM 2. PROPERTIES
ITEM 2
PROPERTIES
AGGREGATES
As the largest U.S. supplier of construction aggregates, we have mining properties across the U.S. and in the Bahamas, Canada, Honduras, Mexico and the U.S. Virgin Islands. We principally serve markets in 23 states, the U.S. Virgin Islands, Washington D.C., and the local markets surrounding our operations in Freeport, Bahamas; British Columbia, Canada; Puerto Cortés, Honduras and Quintana Roo, Mexico (see the NAFTA Arbitration section in Note 12 “Commitments and Contingencies” in Item 8 “Financial Statements and Supplementary Data”). Our primary focus is serving states and metropolitan markets in the U.S. that are expected to experience the most significant growth in population, households and employment. These three demographic factors are significant drivers of demand for aggregates.
Our mining properties are categorized as follows: (1) Production Stage - properties with reported proven or probable reserves where we are actively mining aggregates, (2) Development Stage - properties with reported proven or probable reserves where we are not actively mining aggregates, and (3) Exploration Stage - properties with no reported reserves. The following map illustrates the location of our 244 aggregates production stage properties and 79 development stage properties. Our 40 aggregates exploration stage properties are excluded from this map.
Production and sales are currently halted at our Calica operations in Mexico. For additional information, see Note 12 “Commitments and Contingencies” in Item 8 “Financial Statements and Supplementary Data.”
Production stage properties generally include one or more scale houses, office buildings, maintenance shops and processing plants.
Our aggregates resources and reserves are our foundation and fundamental to our success. However, no individual mining property is individually material to our business. As of December 31, 2024, we directly operated substantially all of our aggregates production facilities.
Part I 24
Our aggregates resources and reserves estimates are calculated in accordance with subpart 1300 of Regulation S-K under the Exchange Act. Our proven and probable aggregates reserves may not be comparable to similar information regarding aggregates reserves disclosed in accordance with the guidance of other countries. We conduct ongoing studies of our deposits to optimize economic values and to manage risk.
We revise our mine plans and estimates of proven and probable aggregates reserves as required and in accordance with the latest available studies. Once mine plans are initially established, the ongoing viability of the plan is reviewed regularly with the benefit of hindsight. Discussions between mine planning, operations and management determine the need for adjustments, additional resources, drilling information or other key information. While construction aggregates reserves and resources are relatively consistent, conditions can change with time that require a newly tailored solution. Examples of changes include fluctuations in physical or chemical parameters of the product, sales product shifts, overburden removal or placement management, structural changes, entitlement changes and land additions.
Our estimates of proven and probable aggregates reserves are prepared by and are the responsibility of our employees. The methodology employed takes a systematic approach to collecting sufficient information to estimate the reserves and resources. Each of our reserve and resource bearing properties is evaluated with supporting information to identify its geological, mining and economic viability. The supporting information includes aerial photography, topography, geologic maps, aggregates rock quality information (including core drilling, hand samples, bulk sample testing and/or geophysical data), hydrology, archaeology, biology, property boundary information, zoning information, and relevant municipal and environmental permitting information. The information is collected by experienced mining engineers and geologists who determine the extent of a resource using a combination of methods including ordinary planimetric based measurements to computer aided design 3-dimensional models.
The results of the supporting information are reviewed by various levels of management, including our “qualified person” (as defined by subpart 1300). This qualified person then verifies that the information adheres to regulatory mandated quantification methods. The economic viability of our reserves is evaluated taking into account historical performance of relevant operations and sales forecasts, among other factors.
Measurements of our proven and probable aggregates reserves have inherent risks. These risks include the accuracy and completeness of geologic information, the interpretation of the data, operational execution, market shifts, structural events and the uncertainty of uncovered material. Management and the qualified person work together to assess these risks regularly and amend the reserves assessments with new information as appropriate. New information can yield site changes that require capital expenditures or cause production performance changes that have financial impacts.
Part I 25
AGGREGATES RESOURCES
Mineral resources are defined as a concentration or occurrence of material of economic interest in or on the earth’s crust in such form, grade or quality, and quantity that there are reasonable prospects for its economic extraction. Mineral resources are classified into three categories, in decreasing level of confidence, as follows:
▪Measured - based on conclusive geological evidence and sampling, meaning that evidence is sufficient to test and confirm geological and grade or quality continuity. After applying modifying factors (as noted in the Aggregates Reserves section below), measured resources may be converted to either proven or probable reserves.
▪Indicated - based on adequate geological evidence and sampling, meaning that evidence is sufficient to establish geological and grade or quality continuity with reasonable certainty. After applying modifying factors, indicated resources may be converted to probable reserves.
▪Inferred - based on limited geological evidence and sampling, meaning that evidence is only sufficient to establish that geological and grade or quality continuity is more likely than not. Inferred resources may not be converted to reserves.
Our reported aggregates resources do not include amounts that have been identified as mineral reserves. Our 2024 measured, indicated and inferred aggregates resources are based on an initial assessment using an average sales price assumption ranging from approximately $9.10 to $26.50 per ton depending on the location/market. The table below presents, by division, details of our aggregates resources as of December 31, 2024.
(millions of tons)
Stone 2
Sand & Gravel
Division 1
Measured (M) Resources Indicated (I) Resources Total (M)+(I) Resources Measured (M) Resources Indicated (I) Resources Total (M)+(I) Resources Total (M)+(I) Resources Inferred
Resources
Central 629.1 1,163.3 1,792.4 8.8 3.9 12.7 1,805.1 580.5
East
2,644.2 748.5 3,392.7 0.0 0.0 0.0 3,392.7 295.3
International 0.0 61.1 61.1 0.0 0.0 0.0 61.1 0.0
Northeast 855.0 15.9 870.9 31.8 0.0 31.8 902.7 19.2
South 558.7 497.2 1,055.9 32.5 52.4 84.9 1,140.8 384.4
Southern Gulf Coast 671.6 175.1 846.7 42.0 0.0 42.0 888.7 218.4
Southwest 478.5 38.9 517.4 93.1 58.7 151.8 669.2 500.0
Western 476.4 875.8 1,352.2 214.1 883.6 1,097.7 2,449.9 962.3
Total 6,313.5 3,575.8 9,889.3 422.3 998.6 1,420.9 11,310.2 2,960.1
1The divisions are defined by states/countries as follows:
Central Division - Illinois, Kentucky and Tennessee
East Division - North Carolina, South Carolina and North/Central Georgia
International Division - Puerto Cortés (Honduras) and Quintana Roo (Mexico)
Northeast Division - Delaware, Maryland, New Jersey, New York, Pennsylvania, Virginia and Washington D.C.
South Division - Florida (excluding panhandle), South Georgia, Freeport (Bahamas) and the U.S. Virgin Islands
Southern Gulf Coast (SGC) Division - Alabama, Arkansas, Florida Panhandle, Louisiana and Mississippi
Southwest Division - Oklahoma and Texas
Western Division - Arizona, California, New Mexico and British Columbia (Canada)
2Stone: amphibolite, argillite, gneiss, granite, limestone, marble, quartzite and sandstone
Part I 26
AGGREGATES RESERVES
Mineral reserves are defined as the economically mineable part of a measured or indicated mineral resource. Mineral reserves are classified into two categories, in decreasing level of confidence, as follows:
▪Proven - those reserves for which the quantity is computed from dimensions revealed by drill data, together with other direct and measurable observations, such as outcrops, trenches and quarry faces. The grade and quality of those reserves are computed from the results of detailed sampling, and the sampling and measurement data are spaced so closely and the geologic character is so well defined that size, shape, depth and mineral content of reserves are well established.
▪Probable - those reserves for which quantity, grade and quality are computed partly from specific measurements and partly from projections based on reasonable, though not drilled, geologic evidence. The degree of assurance, although lower than that for proven reserves, is high enough to assume continuity between points of observation.
Reported proven and probable reserves include only quantities that are owned in fee or under lease and for which all appropriate zoning and permitting have been obtained through permit, contract or grandfathered status. We apply modifying factors to establish the economic viability of the reserves, as follows:
▪Contractual and governmental regulations (for example, leases, zoning, permits and reclamation plans) often set limits on the areas, depths and lengths of time allowed for mining, stipulate setbacks and slopes that must be left in place, and designate which areas may be used for surface facilities, berms, and overburden or waste storage, among other requirements and restrictions.
▪Technical and economic factors affect the estimates of reported reserves regardless of what might otherwise be considered proven or probable based on a geologic analysis. For example, excessive overburden or weathered rock, rock quality issues, excessive mining depths, groundwater issues, overlying wetlands, endangered species habitats, and rights of way or easements may effectively limit the quantity of reserves considered proven and probable.
▪Mining and processing waste are also factored in our computations for proven and probable reserves.
Our 2024 proven and probable aggregates reserves were estimated by internal experts (i.e. geologists or engineers). The economic viability of our reserves were determined using average aggregates prices ranging from approximately $9.10 to $26.50 per ton depending on the location/market.
The table below presents, by division, details of our aggregates reserves and production as of December 31, 2024.
(millions of tons)
Stone 3
Sand & Gravel
Division 1
Proven
Reserves Probable Reserves Total
Reserves Proven
Reserves Probable Reserves Total
Reserves Total
Reserves 2024 2
Production
Central 1,984.0 1,020.3 3,004.3 3.6 5.2 8.8 3,013.1 33.0
East 4
3,233.8 1,106.8 4,340.6 0.0 0.0 0.0 4,340.6 48.7
International 5
471.1 0.0 471.1 0.0 0.0 0.0 471.1 1.7
Northeast 1,364.2 503.5 1,867.7 90.0 17.9 107.9 1,975.6 25.3
South 853.6 359.1 1,212.7 173.6 27.3 200.9 1,413.6 30.3
Southern Gulf Coast 1,864.3 117.5 1,981.8 0.0 0.0 0.0 1,981.8 24.6
Southwest 1,159.6 105.0 1,264.6 156.5 0.0 156.5 1,421.1 27.7
Western 815.9 108.4 924.3 481.1 431.9 913.0 1,837.3 32.9
Total 11,746.5 3,320.6 15,067.1 904.8 482.3 1,387.1 16,454.2 224.2
1The divisions are defined geographically in the first table within this Item 2 - Properties.
2Production totals for the two prior years were as follows: 2023 - 236.0 million tons and 2022 - 235.0 million tons.
3Stone: amphibolite, argillite, gneiss, granite, limestone, marble, quartzite and sandstone.
4Includes a maximum of 256.7 million tons of reserves encumbered by volumetric production payments as defined in Note 2 “Revenues” in Item 8 “Financial Statements and Supplementary Data.”
5Includes 407.6 million tons of reserves at our Calica quarry subject to the NAFTA Arbitration disclosed in Note 12 “Commitments and Contingencies” in Item 8 “Financial Statements and Supplementary Data.”
Our current estimate of 16.5 billion tons of proven and probable aggregates reserves reflects an increase of 0.8 billion tons from the prior year’s estimate which is primarily attributable to acquisitions (see Note 19 "Acquisitions and Divestitures" in Item 8 “Financial Statements and Supplementary Data”). Estimates of reserves are of recoverable stone, sand and gravel of suitable quality for economic extraction, based on drilling and studies by our geologists and engineers, recognizing reasonable economic and operating constraints as to maximum depth of overburden and stone excavation, and subject to permit or other restrictions.
Of the 16.5 billion tons of estimated proven and probable aggregates reserves reported at the end of 2024, 13.7 billion tons or 83% are located on production stage properties, and 2.8 billion tons or 17% are located on development stage properties. We do not report aggregates reserves for exploration stage sites.
Of the 16.5 billion tons of aggregates reserves at December 31, 2024, 10.3 billion tons or 63% are located on owned land and 6.2 billion tons or 37% are located on leased land. Our land portfolio consists of approximately 310,000 acres.
Part I 27
Our Aggregates segment includes a production stage, leased calcium operation located in Brooksville, Florida. This limestone quarry produces a supplement for end-use products such as animal feed and plastics and has an average calcium carbonate content of 97%. As of December 31, 2024, this quarry had 10.7 million tons of proven and probable reserves (there are no mineral resources at this quarry).
In addition to our aggregates mining properties, we operate aggregates sales yards, recycled concrete plants and landfill sites. The table below presents, by division, the count of active aggregates facilities as of December 31, 2024 and the types of facilities operated.
Count of Active Aggregates Operating Facilities
Production Stage Mining Properties 1
Division 2
Stone Sand & Gravel Total Sales Yards Recycle and Landfill Sites Total
Central 48 1 49 4 12 65
East 57 0 57 8 8 73
International 1 0 1 0 0 1
Northeast 17 6 23 26 7 56
South 15 8 23 19 1 43
Southern Gulf Coast 30 0 30 20 2 52
Southwest 16 11 27 25 0 52
Western 15 19 34 7 35 76
Total 199 45 244 109 65 418
1The facility counts above only include mining properties with production in the current year (for example, mining properties with sales from existing stockpiles with no current year production are excluded).
2The divisions are defined geographically in the first table within this Item 2 - Properties.
ASPHALT AND CONCRETE
As of December 31, 2024, we operated a number of facilities producing asphalt mix and ready-mixed concrete in several of our divisions as reflected in the table below:
Division 1
Asphalt 2
Facilities
Concrete
Facilities
Central 11 0
East 0 0
International 0 0
Northeast 0 36
South 0 1
Southern Gulf Coast 4 0
Southwest 14 0
Western 41 37
Total 70 74
1The divisions are defined geographically in the first table within this Item 2 - Properties.
2Asphalt facilities for the Central, Southern Gulf Coast and Southwest Divisions are comprised of asphalt mix facilities and construction paving businesses.
The asphalt and concrete facilities are able to meet their needs for raw material inputs with a combination of internally sourced and purchased raw materials.
HEADQUARTERS
Our headquarters are located in an office complex in Birmingham, Alabama. The office space consists of approximately 184,000 square feet and is leased through December 31, 2038. The annual rental cost for the current term of the lease is approximately $4.4 million.
Part I 28

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ITEM 3. LEGAL PROCEEDINGS
ITEM 3
LEGAL PROCEEDINGS
We are subject to occasional governmental proceedings and orders pertaining to occupational safety and health or to protection of the environment, such as proceedings or orders relating to noise abatement, air emissions or water discharges. As part of our continuing program of stewardship in safety, health and environmental matters, we have been able to resolve such proceedings and to comply with such orders without any material adverse effects on our business.
We are a defendant in various lawsuits in the ordinary course of business. It is not possible to determine with precision the outcome of, or the amount of liability, if any, under these lawsuits, especially where the cases involve possible jury trials with as yet undetermined jury panels.
We were not subject to any penalties in 2024 for failure to disclose transactions identified by the Internal Revenue Service as abusive under Internal Revenue Code Section 6707A.
See Note 12 “Commitments and Contingencies” in Item 8 “Financial Statements and Supplementary Data” for a discussion of our material legal proceedings.

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ITEM 4. MINE SAFETY DISCLOSURE
ITEM 4
MINE SAFETY DISCLOSURES
The information concerning mine safety violations or other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K is included in Exhibit 95 of this report.
Part I 29
INFORMATION ABOUT OUR EXECUTIVE OFFICERS
The names, positions and ages, as of February 20, 2025, of our executive officers are as follows:
Name Position Age
J. Thomas Hill Chairman and Chief Executive Officer 65
Thompson S. Baker II President 66
Mary Andrews Carlisle Senior Vice President and Chief Financial Officer 44
Stanley G. Bass Chief Strategy Officer 63
Ronnie A. Pruitt Chief Operating Officer 54
Denson N. Franklin III Senior Vice President, General Counsel and Secretary 61
David P. Clement Senior Vice President, Operations Support, Procurement 64
Jerry F. Perkins Jr. Senior Vice President, Business Development, Commercial Excellence, Land, Logistics 55
Randy L. Pigg Vice President, Controller and Principal Accounting Officer 52
The principal occupations of the executive officers during the past five years are set forth below:
J. Thomas Hill was elected Chairman of the Board of Directors effective January 1, 2016 and President and Chief Executive Officer in July 2014. He served as President through September 2023. Previously, he served as Executive Vice President and Chief Operating Officer from January 2014 to July 2014, and Senior Vice President of the South Region from December 2011 to December 2013. Prior to that, he served in a number of positions with Vulcan including President, Florida Rock Division from September 2010 to December 2011.
Thompson S. Baker II was elected President effective September 2023 after serving as Chief Operating Officer since May 2019. He previously served as Senior Vice President from March 2017 to April 2019. Prior to that, he served in a number of positions with Vulcan, including President of the Florida Rock Division, before serving as Chief Executive Officer of FRP Holdings, Inc. from October 2010 to March 2017 and President and Chief Executive Officer of Patriot Transportation Holding, Inc. from December 2014 to March 2017.
Mary Andrews Carlisle was appointed Chief Financial Officer effective September 1, 2022. In her prior role as Vice President, Finance, she led a number of key financial, operational and corporate initiatives since March 2020. Ms. Carlisle joined the Company in 2006 and has held roles of increasing responsibility in multiple divisions as well as in corporate finance and business development.
Stanley G. Bass was elected Chief Strategy Officer in March 2021 after serving as Chief Growth Officer since February 2016. He served as Senior Vice President of the Western and Mountain West Divisions from January 2015 to February 2016, and Senior Vice President of the West Region from September 2013 to December 2014. Prior to that, he served as Senior Vice President of the Central and West Regions from February 2013 to September 2013 and Senior Vice President of the Central Region from December 2011 to February 2013. Prior to that, he served in a number of positions with Vulcan including President, Midsouth and Southwest Divisions from September 2010 to December 2011.
Ronnie A. Pruitt was appointed Chief Operating Officer effective September 2023. He previously served as Senior Vice President of the Southwest and Western Divisions. He joined Vulcan as part of Vulcan’s August 2021 acquisition of U.S. Concrete, Inc. He held various leadership roles at U.S. Concrete, including President and Chief Executive Officer from April 2020 to August 2021, President and Chief Operating Officer from April 2019 to April 2020, and Senior Vice President and Chief Operating Officer from October 2015 to April 2019. Prior to joining U.S. Concrete in 2015, he served as the Vice President of Cement Sales of Martin Marietta Materials, Inc. and held various positions at Texas Industries, Inc.
Denson N. Franklin III joined the Company in December 2019 as Senior Vice President, General Counsel and Secretary. Prior to that, he was a partner at Bradley Arant Boult Cummings LLP, a law firm based in Birmingham, Alabama. While at Bradley, he served as Vulcan’s primary outside counsel for more than 20 years and advised other companies in the construction materials, building and engineering industries.
David P. Clement is Senior Vice President of Operations Support and Strategic Sourcing. He previously served as Senior Vice President of the Central Division since August 2021 and, prior to that role, served as Senior Vice President of the Mountain West and Western Divisions since March 2020. He first joined the organization as an operations management trainee in 1983 and progressed to the position of area production manager in 1993. After spending a few years at Pioneer Mid-Atlantic and working as a consultant, he rejoined Vulcan in 2004 as Vice President and General Manager of the Midwest Division. He has held the positions of Vice President of Operations for the Midwest Division, Vice President and General Manager of the Central Region, Senior Vice President of the Central Region and President of the Central Division.
Jerry F. Perkins Jr. is Senior Vice President of Business Development, Commercial Excellence, Land and Logistics. He previously served as Senior Vice President of the Southern Gulf Coast and Mountain West Divisions since August 2021 and, prior to that role, served as Senior Vice President of the Southern Gulf Coast and Southwest Divisions since March 2020. Prior to that role, he was President of the Southern and Gulf Coast Division. He also served as General Counsel and Corporate Secretary and held various legal leadership roles for Vulcan. Before joining Vulcan in 2002, he worked as a certified public accountant (CPA) at a global accounting firm and was an attorney with Burr & Forman LLP in Birmingham, Alabama.
Randy L. Pigg was elected Vice President, Controller and Principal Accounting Officer in April 2018. He served as Vice President, Accounting since June 2016, and prior to that served as Director, Financial Shared Services since April 2014. Prior to that, he served in a number of positions with Vulcan, including Manager, Financial Research & Reporting and Finance Director of the Central Region.
Part I 30
PART II

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ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY
ITEM 5
MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS
AND ISSUER PURCHASES OF EQUITY SECURITIES
Our common stock is traded on the New York Stock Exchange (ticker symbol VMC). As of February 13, 2025, the number of shareholders of record was 1,977.
We did not purchase any of our equity securities during the fourth quarter of 2024.
We did not have any unregistered sales of equity securities during the fourth quarter of 2024.

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ITEM 6. SELECTED FINANCIAL DATA
ITEM 6
[RESERVED]
Part II 31

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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS
ITEM 7
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The objective of our management’s discussion and analysis is to help investors understand our operations and current business environment from the perspective of our management. The following discussion should be read in conjunction with the consolidated financial statements and the accompanying notes contained in this Annual Report. The following generally includes a comparison of our results of operations and liquidity and capital resources for 2024 and 2023. For the discussion of changes from 2022 to 2023 and other financial information related to 2022, refer to Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations, of our Form 10-K for the year ended December 31, 2023 filed with the Securities and Exchange Commission on February 22, 2024.
EXECUTIVE SUMMARY
FINANCIAL SUMMARY FOR 2024
COMPARED TO 2023:
▪Total revenues decreased $364.2 million, or 5%, to $7,417.7 million
▪Gross profit increased $51.1 million, or 3%, to $1,999.6 million
▪Selling, administrative and general (SAG) expenses decreased 2% to $531.1 million and increased 20 basis points as a percentage of total revenues
▪Operating earnings decreased $62.9 million, or 4%, to $1,364.5 million
▪Earnings attributable to Vulcan from continuing operations were $6.91 per diluted share, compared to $7.06 per diluted share
▪Adjusted earnings attributable to Vulcan from continuing operations were $7.53 per diluted share, compared to $7.00 per diluted share
▪Net earnings attributable to Vulcan were $911.9 million, a decrease of $21.3 million, or 2%
▪Adjusted EBITDA was $2,057.2 million, an increase of $45.9 million, or 2%
▪Aggregates segment sales increased $30.7 million, or 1%, to $5,949.6 million
▪Aggregates segment freight-adjusted revenues increased $174.9 million, or 4%, to $4,636.2 million
▪Shipments decreased 6%, or 14.6 million tons, to 219.9 million tons
▪Freight-adjusted sales price increased 10.8%, or $2.06 per ton to $21.08
▪Aggregates segment gross profit increased $79.9 million, or 5%, to $1,816.7 million
▪Unit profitability (as measured by gross profit per ton) increased 12% to $8.26 per ton
▪Unit profitability (as measured by cash gross profit per ton) increased 12% to $10.61 per ton
▪Asphalt and Concrete segment sales decreased $490.9 million, or 21%, to $1,899.1 million, collectively
▪Asphalt and Concrete segment gross profit decreased $28.8 million, or 14%, to $182.9 million, collectively
▪Returned capital to shareholders via dividends of $244.4 million at $1.84 per share versus $228.4 million at $1.72 per share
▪Returned capital to shareholders via share repurchases of $68.8 million at $254.71 average price per share compared to $200.0 million at $204.52 average price per share
Our aggregates-led business delivered a strong finish to the year. Adjusted EBITDA in the fourth quarter improved 16%, and Adjusted EBITDA margin expanded 370 basis points. The favorable pricing environment coupled with strong operational execution led to consistent year-over-year improvement in aggregates gross profit per ton each quarter (and double-digit improvement in cash gross profit per ton) - finishing 2024 with aggregates gross profit per ton of $9.02 and cash gross profit per ton of $11.50 for the fourth quarter. As we look to 2025, the pricing environment remains favorable, and we are focused on our operating disciplines to manage costs and improve efficiencies. By controlling what we can control, we expect to deliver approximately 19% growth in Adjusted EBITDA.
At year-end 2024, total debt to Adjusted EBITDA was 2.6 times (2.3 times on a net debt basis, reflecting $600.8 million of cash on hand). Our weighted-average debt maturity was 12.6 years, and our total weighted-average effective interest rate was 5.0%. Return on invested capital was 16.2%. We remain well positioned for continued growth with a strong liquidity position and balance sheet profile.
Adjusted EBITDA, Aggregates segment freight-adjusted revenues, cash gross profit per ton, debt to Adjusted EBITDA and return on invested capital are non-GAAP measures. See the definitions and reconciliations within this Item 7 under the caption “Reconciliation of Non-GAAP Financial Measures.”
Part II 32
CAPITAL ALLOCATION
Our balanced approach to capital allocation remains unchanged. Through economic cycles we intend to balance reinvestment in our business, growth through acquisitions and internal growth projects, and return of capital to shareholders while maintaining financial strength and flexibility evidenced by our strong balance sheet and investment-grade credit ratings. Our capital allocation priorities are as follows:
1.Operating Capital (maintain and grow the value of our franchise)
2.Growth Capital (including acquisitions and greenfields)
3.Dividend Growth (with a keen focus on sustainability)
4.Return Excess Cash to Shareholders (primarily via share repurchases)
Our first priority is to maintain and protect our valuable franchise by keeping our operations in good working order to ensure the production of high quality materials and timely delivery of goods and services to our customers. This capital requirement expands and contracts as production and shipment levels change. During 2024, we invested $638.0 million in capital expenditures to replace or improve existing property, plant & equipment.
Our second priority is to grow our franchise, primarily through business acquisitions and complemented by internal growth investments. For business acquisitions, we tend to look for bolt-on acquisitions, which are easier to integrate, and will pursue large business combinations that are the right fit and the right price. We use strategic and returns-based criteria to price potential acquisitions and are disciplined in our approach. We evaluate many potential acquisitions and only make offers on a few. We closed six business acquisitions during 2024 for total consideration of $2,297.1 million, including our acquisitions of Wake Stone Corporation (Wake Stone) and Superior Ready Mix, L.P. (Superior). Wake Stone was a leading pure-play aggregates supplier in the Carolinas, and Superior was an integrated aggregates, asphalt and concrete producer in Southern California. These acquisitions add quality aggregates reserves to our existing franchise in three attractive states. We also completed bolt-on acquisitions in both Alabama and Texas. All of our 2024 acquisitions were in our top 10 revenue states, demonstrating consistency with our disciplined capital allocation priorities and aggregates-led strategy of continuing to expand our reach through value-enhancing acquisitions.
Our third priority is growing the dividend with a keen focus on sustainability through the economic cycle. During 2024, we paid a dividend per share of $1.84 and paid total dividends of $244.4 million.
And finally, if there is excess cash after fulfilling the prior capital allocation priorities, we will consider returning cash to shareholders via share repurchases. During 2024, we returned $68.8 million to our shareholders through share repurchases.
For a detailed discussion of our acquisitions and divestitures, see Note 19 “Acquisitions and Divestitures” in Item 8 “Financial Statements and Supplementary Data.”
MARKET DEVELOPMENTS AND OUTLOOK
We carry solid momentum into 2025 and are well positioned to deliver another year of strong earnings growth and cash generation. Continued strength in public construction activity and our recent acquisitions support our expectations for volume growth in 2025. The pricing environment remains positive, and inflationary pressures continue to moderate. This backdrop, coupled with our Vulcan Way of Selling and Vulcan Way of Operating disciplines, will lead to further expansion in our industry-leading aggregates cash gross profit per ton and value creation for our shareholders.
Our expectations for 2025 include:
▪A third consecutive year of double-digit year-over-year growth in Aggregates segment cash gross profit per ton ($10.61 in 2024)
▪Shipments growth of 3% to 5% (219.9 million tons in 2024)
▪Freight-adjusted price improvement of 5% to 7% ($21.08 in 2024); inclusive of over 100 basis points of negative mix impact from recent acquisitions
▪Low to mid-single digit increase in freight-adjusted unit cash cost (freight-adjusted price less segment cash gross profit per ton; $10.47 in 2024)
▪Total Asphalt and Concrete segment cash gross profit of approximately $360 million ($272 million in 2024)
▪Relative contribution of approximately two-thirds from the Asphalt segment and one-third from the Concrete segment
▪Selling, Administrative and General expenses of $550 million to $560 million ($531 million in 2024)
▪Interest expense of approximately $245 million
▪Capital spending for maintenance and growth projects of $750 million to $800 million
▪Depreciation, depletion, accretion and amortization expense of approximately $800 million
▪An effective tax rate of 22% to 23%
▪Net earnings attributable to Vulcan of $1,010 million to $1,170 million
▪Adjusted EBITDA between $2,350 million and $2,550 million (includes $150 million contribution from acquisitions)
Part II 33
POSITIONED FOR GROWTH AND VALUE CREATION
DURABLE BUSINESS MODEL TO EXTEND THE CYCLE AND SUSTAIN GROWTH
▪39% improvement in Aggregates gross profit per ton since 2022
▪36% improvement in Aggregates cash gross profit per ton since 2022
▪Industry-leading commercial, logistics, operational and sourcing capabilities
▪End market fundamentals support continued growth outlook
▪Poised to benefit from generational investment in infrastructure that could extend the growth cycle by mitigating private construction cyclicality
We have continued to deliver strong financial performance over time and through business cycles. Through our aggregates-led strategy and focus on our strategic disciplines - the Vulcan Way of Selling (Commercial Excellence & Logistics Innovation) and the Vulcan Way of Operating (Operational Excellence & Strategic Sourcing), as outlined in Item 1 “Business” under the “Business Strategy” heading - we have created one of the most profitable public companies in our industry as measured by aggregates gross profit per ton.
In 2019, we set a target of $9 of cash gross profit per ton on volumes of 230 to 240 million tons, which we exceeded in 2023. In 2022, we set a new target to achieve $11 to $12 cash gross profit per ton once we reach 260 to 270 million tons. We delivered $10.61 of cash gross profit per ton on 220 million tons in 2024, exiting the year with cash gross profit of $2,332 million. Our durable growth strategy gives us confidence that we will deliver more value to our shareholders on every ton of aggregates we sell.
Cash gross profit per ton is a non-GAAP measure. See the definitions and reconciliations within this Item 7 under the caption "Reconciliation of Non-GAAP Financial Measures."
More than an aggregates supplier, we are a business dedicated to customer service and finding creative solutions to meet our customers’ needs. Being a valued partner and trusted supplier means that we are providing the right product, with the right specifications, that is the right quality, delivered the right way - on time and safely. Our One Vulcan, Locally Led approach, in which our employees work together to leverage the size and strengths of Vulcan as a whole, while running their operations with a strong entrepreneurial spirit and sense of ownership, allows us to deliver market-leading services to our customers.
Part II 34
Transportation costs are passed along to our customers, and because aggregates have a very high weight-to-price ratio, those costs can add up quickly when transporting aggregates long distances. Having the most extensive distribution network of any aggregates producer sets us apart. Combining our trucking, rail, barge and ocean vessel shipping logistics capabilities allows us to provide better customer solutions and create a seamless customer experience at a competitive price. As an approximation, a truck has a capacity of 20-25 tons of aggregates; a railcar has a capacity of 4-5 truckloads; a barge has a capacity of 65 truckloads; and our ocean vessels have the capacity of 2,500 truckloads.
Production and sales are currently halted at our Calica operations in Mexico. For additional information, see Note 12 “Commitments and Contingencies” in Item 8 “Financial Statements and Supplementary Data.”
Part II 35
INDUSTRY LEADER WITH CLEAR COMPETITIVE ADVANTAGES
▪Largest U.S. aggregates producer with strategic geographic diversity
▪423 active aggregates facilities with 16.5 billion tons of reserves
▪Leading unit profitability margins driven by operational expertise and pricing performance
▪76% of the U.S. population growth over the next decade is projected to occur in Vulcan-served states
Over time, we have strategically and systematically built one of the most valuable aggregates franchises in the U.S. with a footprint that is impossible to replicate. Zoning and permitting regulations have made it increasingly difficult to expand existing quarries or to develop new quarries. Such regulations, while curtailing expansion, also increase the value of our reserves that were zoned and permitted decades ago.
Demand for aggregates correlates positively with changes in population, household formations and employment. We have a coast-to-coast footprint that serves 35 of the top 50 highest-growth metropolitan statistical areas (MSAs). As state and federal spending increase, Vulcan is poised to benefit greatly from growing private and public demand for aggregates, thereby delivering significant long-term value for our shareholders.
Source: Woods & Poole CEDDS 2024
Based on people added from 2024 to 2034
Part II 36
STRONG CASH FLOW GENERATION AND INVESTMENT-GRADE BALANCE SHEET
▪Financial capacity to sustain capital reinvestment in current asset base and to fund growth
▪Maintain an investment-grade credit position
▪Continue to leverage current capital base to grow earnings and maximize cash generation
▪Prudently pursue attractive acquisitions and greenfields
▪Return value to shareholders with dividends and stock repurchases
Free Cash Flow Growth
in millions
Free cash flow is a Non-GAAP measure and calculated by subtracting purchases of property, plant and equipment from operating cash flows. Free cash flow is useful to investors in understanding how existing cash from operations is utilized as a source for sustaining our current capital plan and future development growth.
Our financial position is strong as evidenced by our long-term investment-grade credit ratings (Fitch BBB/Moody’s Baa2/Standard & Poor’s BBB+). At December 31, 2024, our available liquidity was $2,064.5 million, including $559.7 million of unrestricted cash on hand, significantly higher than our liquidity needs. Our leverage ratio, as measured by total debt to Adjusted EBITDA, was 2.6 times at December 31, 2024 (our net debt to Adjusted EBITDA ratio at December 31, 2024 was 2.3 times). Our long-term leverage target is 2.0 to 2.5x.
*These years include significant acquisition activity (see Part I, Item 1 "Business" under the caption "Business Strategy" for further details).
Part II 37
SAFETY, HEALTH AND ENVIRONMENTAL PERFORMANCE
A strategy for sustainable, long-term value creation must include doing right by our employees, our neighbors and the environment in which we operate. Over our more than six decades as a public company, we have built a strong, resilient and vital business on this foundation of doing things the right way.
We are a leader in our industry in safety, health and environmental performance, with a safety record substantially better than the industry average. We apply the shared experiences, expertise and resources at each of our locally led sites with an emphasis on taking care of one another. The result is a record of safety excellence that consistently outperforms the industry.
Vulcan MSHA Injury Rate Compared to Aggregates Industry
Number of Injuries per 200,000 Hours Worked
Source: Bureau of Labor Statistics records and internal Vulcan data.
*The aggregates industry MSHA injury rate for 2024 was not available as of the filing of this report.
We focus on our environmental stewardship programs with the same commitment that we bring to our health and safety initiatives resulting in 98% citation-free inspections out of all 2024 federal and state environmental inspections. As an industry leader, our aim is to meet - and strive to exceed - all federal, state and local environmental regulations.
However, sustainability means looking beyond what is required of a company by governments and regulators. Sustainability is reflected in our business strategy. We lead community relations programs that serve our neighbors while ensuring that we grow and thrive in the communities where we operate. In all parts of our company, from local operations to our corporate and regional offices to our international business and ocean-going shipping, we are focused on ensuring that our operations are efficient in ways that are economically and environmentally sustainable. It’s the right thing to do for our business and our stakeholders.
We continue to make progress on reducing our carbon footprint, increasing our energy efficiency, and measuring and reducing our water use. We also manage our land with biodiversity in mind. During 2024, we operated 33 sites containing wildlife enhancement programs that are certified by the Wildlife Habitat Council in addition to several other sites that are working towards certification.
We recognize that the aggregates mining in which we engage is an interim use of the approximately 310,000 acres of land in our portfolio. Our land and water assets will be converted to other valuable uses at the end of mining. Effective management throughout the life cycle of our land - from pre-mining utilization as agriculture and timber development, to post-mining development as water reservoirs or residential and commercial development - not only generates significant additional value for our shareholders but greatly benefits the communities in which we operate.
Part II 38
RESULTS OF OPERATIONS
Total revenues are primarily derived from our product sales of aggregates, asphalt mix and ready-mixed concrete, and include freight & delivery costs that we pass along to our customers to deliver these products. We also generate service revenues from our asphalt construction paving business and services related to our aggregates business. We present separately our discontinued operations, which consists of our former Chemicals business.
The following table highlights significant components of our consolidated operating results including EBITDA and Adjusted EBITDA.
CONSOLIDATED OPERATING RESULTS HIGHLIGHTS
For the years ended December 31
in millions, except per share and per unit data 2024 2023 2022
Total revenues $ 7,417.7 $ 7,781.9 $ 7,315.2
Cost of revenues (5,418.1) (5,833.4) (5,757.5)
Gross profit 1,999.6 1,948.5 1,557.7
Gross profit margin 27.0 % 25.0 % 21.3 %
Selling, administrative and general expenses (531.1) (542.8) (515.1)
SAG as a percentage of total revenues 7.2 % 7.0 % 7.0 %
Gain on sale of property, plant & equipment and businesses 52.3 76.4 10.7
Loss on impairments (86.6) (28.3) (67.9)
Operating earnings 1,364.5 1,427.4 951.4
Interest expense (191.2) (196.1) (169.2)
Earnings from continuing operations before income taxes 1,172.1 1,245.1 788.1
Income tax expense (251.4) (299.4) (193.0)
Effective tax rate from continuing operations 21.4 % 24.0 % 24.5 %
Earnings from continuing operations 920.7 945.7 595.1
Loss on discontinued operations, net of tax (7.6) (10.8) (18.6)
Earnings attributable to noncontrolling interest (1.2) (1.7) (0.9)
Net earnings attributable to Vulcan $ 911.9 $ 933.2 $ 575.6
Diluted earnings (loss) per share attributable to Vulcan
Continuing operations $ 6.91 $ 7.06 $ 4.45
Discontinued operations (0.06) (0.08) (0.14)
Net earnings $ 6.85 $ 6.98 $ 4.31
EBITDA 1
$ 1,963.2 $ 2,025.4 $ 1,517.9
Adjusted EBITDA 1
$ 2,057.2 $ 2,011.3 $ 1,625.6
Average Sales Price and Unit Shipments
Aggregates
Tons 219.9 234.6 236.6
Freight-adjusted sales price $ 21.08 $ 19.02 $ 16.41
Asphalt Mix
Tons 13.6 13.4 12.2
Average sales price $ 80.09 $ 75.76 $ 71.29
Ready-mixed concrete
Cubic yards 3.6 7.5 10.5
Average sales price $ 182.93 $ 166.95 $ 150.82
1Non-GAAP measures are defined and reconciled within this Item 7 under the caption "Reconciliation of Non-GAAP Financial Measures."
Part II 39
Net earnings attributable to Vulcan for 2024 were $911.9 million ($6.85 per diluted share) compared to $933.2 million ($6.98 per diluted share) in 2023. Each year's results were impacted by discrete items, as follows:
Net earnings attributable to Vulcan for 2024 include:
▪pretax net gain of $36.7 million related to the sale of real estate in Virginia
▪pretax charges of $86.6 million associated with a goodwill impairment
▪pretax charges of $17.7 million for divested operations
▪pretax charges of $16.3 million associated with non-routine acquisitions
▪pretax loss on discontinued operations of $10.2 million
Net earnings attributable to Vulcan for 2023 include:
▪pretax net gain of $67.1 million related to the sale of excess real estate and businesses
▪pretax charges of $28.3 million for long-lived asset impairments related to the sale of businesses
▪pretax charges of $7.9 million for divested operations
▪pretax charges of $2.1 million associated with non-routine acquisitions
▪pretax loss on discontinued operations of $14.7 million
▪$12.9 million of tax charges related to a valuation allowance against Calica deferred tax assets, including net operating loss (NOL) carryforwards
Adjusted for these discrete items, earnings attributable to Vulcan from continuing operations (Adjusted Diluted EPS) was $7.53 per diluted share for 2024 compared to $7.00 per diluted share for 2023.
EARNINGS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
Year-over-year changes in earnings from continuing operations before income taxes are summarized below:
in millions
2022 $ 788.1 2023 $ 1,245.1
Higher aggregates gross profit 325.7 79.9
Higher asphalt gross profit 92.3 20.5
Lower concrete gross profit (27.2) (49.3)
Lower (higher) selling, administrative and general expenses (27.7) 11.7
Higher (lower) gain on sale of property, plant & equipment and businesses 65.7 (24.1)
Lower (higher) impairment charges 39.6 (58.3)
Lower (higher) interest expense (26.9) 9.3
Lower (higher) acquisition related expenses
8.4 (14.2)
Higher environmental remediation expenses
(1.4) (15.7)
Lower (higher) foreign currency transaction losses
4.5 (16.5)
All other 4.0 (16.3)
2023 $ 1,245.1 2024 $ 1,172.1
Part II 40
OPERATING RESULTS BY SEGMENT
We present our results of operations by segment at the gross profit level. We have three operating (and reportable) segments organized around our principal product lines: (1) Aggregates, (2) Asphalt and (3) Concrete. Management reviews earnings for our reporting segments principally at the gross profit level.
1.AGGREGATES
SHIPMENTS
in millions
Aggregates shipments decreased 6%, reflecting underlying demand as well as the impacts from severe weather events in the third quarter which were not all recovered during the fourth quarter of 2024.
Our year-over-year freight-adjusted selling price1 for aggregates:
▪increased 10.8% in 2024
▪increased 15.9% in 2023
▪increased 10.3% in 2022
1We routinely arrange the delivery of our aggregates to the customer. Additionally, we incur freight costs to move aggregates from the production site to remote distribution sites. These costs are passed on to our customers in the aggregates price. We remove these pass-through freight & delivery revenues (and any other aggregates-derived segment revenues, such as landfill tipping fees) from the freight-adjusted selling price for aggregates. See the "Reconciliation of Non-GAAP Financial Measures" within this Item 7 for a reconciliation of freight-adjusted revenues.
Part II 41
The pricing environment remained positive. Freight-adjusted pricing increased 10.8% ($2.06 per ton) versus the prior year to $21.08, with all markets realizing year-over-year improvement.
AGGREGATES GROSS PROFIT
in millions
AGGREGATES CASH GROSS PROFIT
in millions
Aggregates segment gross profit increased 5% to $1,816.7 million (or $8.26 per ton), and gross profit margin expanded 120 basis points. Cash gross profit per ton increased 12% (or $1.15 per ton) from the prior year to $10.61 resulting from continued pricing growth and moderating cost trends. Improvements in unit profitability were widespread across our footprint.
Freight-adjusted unit cash cost of sales increased 10%, or $0.91 per ton. Shipments in 2024 and 2023 were negatively impacted by the absence of tons available from our Mexico operations which were unexpectedly and arbitrarily shut down by the Mexican government in 2022 (for additional information, see Note 12 “Commitments and Contingencies” in Item 8 “Financial Statements and Supplementary Data”).
2ASPHALT
SHIPMENTS
in millions
Asphalt segment gross profit was $170.1 million (an increase of $20.5 million), and cash gross profit was $214.2 million, a 16% increase from the prior year. Shipments increased slightly, and pricing increased 5.7%, or $4.33 per ton.
ASPHALT GROSS PROFIT
in millions
ASPHALT CASH GROSS PROFIT
in millions
Our year-over-year average sales price1 for asphalt mix:
•increased 5.7% in 2024
•increased 6.3% in 2023
•increased 21.2% in 2022
1Asphalt mix average sales price is calculated by dividing revenues generated from the shipment of asphalt mix by the total tons shipped. The sales price calculation excludes service revenues generated from our asphalt construction paving business.
Part II 42
3.CONCRETE
SHIPMENTS
in millions
Concrete segment gross profit was $12.8 million, a decrease of $49.3 million from the prior year which included earnings from our divested operations in Texas. Cash gross profit was $58.3 million, and unit cash gross profit was $16.35 per cubic yard.
CONCRETE GROSS PROFIT
in millions
CONCRETE CASH GROSS PROFIT
in millions
Our year-over-year average sales price1 for ready-mixed concrete:
▪increased 9.6% in 2024
▪increased 10.7% in 2023
▪increased 11.1% in 2022
1Ready-mixed concrete average sales price is calculated by dividing revenues generated from the shipment of ready-mixed concrete by the total cubic yards shipped. The sales price calculation excludes immaterial revenues generated from the sale of raw materials.
Part II 43
SELLING, ADMINISTRATIVE AND GENERAL EXPENSES
in millions
As a percentage of total revenues, SAG expense was:
▪7.2% in 2024 - increased 20 basis points
▪7.0% in 2023 - unchanged from the prior year
▪7.0% in 2022 - decreased 50 basis points
Our comparative headcount levels at year-end:
▪increased 9% in 2024
▪decreased 8% in 2023
▪increased 6% in 2022
The 2024 increase in our employment level was primarily the result of acquisitions (see Note 19 "Acquisitions and Divestitures" in Item 8 “Financial Statements and Supplementary Data”). As noted above, 2024 SAG expense was $531.1 million, 2% lower than the prior year, or 7.2% as a percentage of total revenues. The current year includes overhead costs associated with acquisitions completed during the year. We expect to realize cost synergies in 2025 as the acquired operations become fully integrated.
GAIN ON SALE OF PROPERTY, PLANT & EQUIPMENT AND BUSINESSES
in millions
The 2024 gain on sale of property, plant & equipment and businesses of $52.3 million includes a pretax gain of $36.7 million from the sale of a former sales yard in Virginia. The 2023 gain on sale of property, plant & equipment and businesses of $76.4 million includes a pretax gain of $65.7 million from the sale of excess real estate in Virginia and a pretax gain of $15.2 million from the sale of real estate associated with a former recycled concrete facility in Illinois, partially offset by a pretax loss of $13.8 million related to the sale of our Texas concrete operations. We remain focused on our efforts to maximize the value of our portfolio of quarry operations as they move through their life-cycle of land management. For additional details, see Note 19 “Acquisitions and Divestitures” in Item 8 “Financial Statements and Supplementary Data.”
LOSS ON IMPAIRMENTS
Loss on impairments was $86.6 million in 2024 which represents a goodwill impairment charge related to a reporting unit that includes concrete operations acquired from U.S. Concrete in 2021. Loss on impairments was $28.3 million in 2023 which represents a long-lived asset impairment charge related to the Texas concrete operations that were sold during the fourth quarter of 2023.
See Note 18 “Goodwill and Intangible Assets” and Note 19 “Acquisitions and Divestitures” in Item 8 “Financial Statements and Supplementary Data” for additional discussion.
OTHER OPERATING EXPENSE, NET
Other operating income (expense) is composed primarily of idle facilities expense, environmental remediation costs, gain (loss) on settlement of AROs, finance charges collected and rental income (expense). Total other operating expense and significant and/or discrete items included in the total were:
▪$69.7 million in 2024 - includes the following:
▪$17.7 million of charges associated with divested operations
▪$8.5 million of charges associated with non-routine acquisitions (excludes items included in cost of revenues)
▪$34.9 million of idle facilities expenses
•$26.4 million in 2023 - includes the following:
▪$7.9 million of charges associated with divested operations
▪$1.6 million of charges associated with non-routine acquisitions (excludes items included in cost of revenues)
▪$27.4 million of idle facilities expenses
Part II 44
OTHER NONOPERATING INCOME (EXPENSE), NET
Other nonoperating income (expense), net was $22.1 million of expense in 2024 and $2.7 million of expense in 2023, composed primarily of pension and postretirement benefit costs (excluding service costs), foreign currency transaction gains/losses, Rabbi Trust gains/losses and net earnings/losses of nonconsolidated equity method investments.
INTEREST EXPENSE
in millions
Interest expense was $191.2 million in 2024 compared to $196.1 million in 2023. See Note 6 “Debt” in Item 8 “Financial Statements and Supplementary Data” for additional discussion.
INCOME TAXES
Our income tax expense from continuing operations for the years ended December 31 is shown below:
dollars in millions 2024
Earnings from continuing operations before income taxes $ 1,172.1 $ 1,245.1 $ 788.1
Income tax expense $ 251.4 $ 299.4 $ 193.0
Effective tax rate 21.4 % 24.0 % 24.5 %
The $48.0 million decrease in our 2024 income tax expense compared to 2023 was primarily related to a decrease in earnings from continuing operations and the income tax benefit recorded for the remeasurement of our deferred taxes at a new blended income tax rate. The $106.4 million increase in our 2023 income tax expense compared to 2022 was primarily related to an increase in earnings from continuing operations.
During the fourth quarter of 2024, we determined that the rate at which our deferred tax liabilities will reverse has decreased, largely as a result of changes in our state tax profile from the Wake Stone acquisition. As a result, we remeasured our deferred tax liabilities and recorded a tax benefit of $21.9 million.
In May 2022, Mexican government officials unexpectedly and arbitrarily shut down our Calica operations in Mexico. In 2024, Calica had deferred tax assets (including NOLs) of $27.5 million. Although Calica continues to record losses, the devaluation of the Mexican peso during the year resulted in an immaterial change to its deferred tax assets in U.S. dollars. As a result, we recorded a charge to increase the valuation allowance by $0.1 million to $27.5 million in 2024. The Calica NOL deferred tax asset carryforward of $23.3 million would expire between 2032 and 2033 if not utilized. Should the Mexican government lift the shutdown and/or we are successful in our North American Free Trade Agreement (NAFTA) claim, we will reevaluate the need for a valuation allowance against the deferred tax assets.
For additional information, see Note 9 “Income Taxes” in Item 8 “Financial Statements and Supplementary Data.”
Part II 45
DISCONTINUED OPERATIONS
Pretax loss from discontinued operations was:
•$(10.2) million in 2024
•$(14.7) million in 2023
•$(25.2) million in 2022
Pretax loss from discontinued operations for 2024 and 2023 resulted primarily from general and product liability costs, including legal defense costs and environmental remediation costs associated with our former Chemicals business. In addition, 2022 includes a $15.3 million charge for a litigation matter (see Note 12 “Commitments and Contingencies” in Item 8 “Financial Statements and Supplementary Data”). For additional information about discontinued operations, see Note 1 “Summary of Significant Accounting Policies” in Item 8 “Financial Statements and Supplementary Data.”
KNOWN TRENDS OR UNCERTAINTIES
Inflationary pressures and labor constraints can be factors that impact our operations. Although inflationary pressures can create short-term to medium-term headwinds, the combination of inflation and visibility of demand may create a favorable environment for price increases. Additionally, labor constraints can cause delays and inefficiencies in our operations as well as those of our customers. If labor constraints continue, our operations may proceed at a slower pace, which may effectively extend the recovery while allowing us the opportunity to compound price, control costs and grow earnings.
Further, the Mexican government has taken actions adverse to our property and operations in Mexico. On May 5, 2022, Mexican government officials presented employees at our Calica operations in Quintana Roo, Mexico with arbitrary shutdown orders to immediately cease underwater quarrying and extraction operations. On May 13, 2022, the Mexican government suspended the three-year customs permit granted in March 2022 to Calica and began a proceeding that could result in the revocation of that permit. In September 2024, the Mexican government ordered the closure of Calica's already-suspended quarrying activities and the shutdown of certain activities at Calica's Punta Venado port facilities. On September 23, 2024, the President of Mexico signed a presidential decree declaring the entirety of Calica's properties as a "Natural Protected Area" (the "ANP Decree"). Among other provisions, the ANP Decree prohibits Calica from extracting petrous or construction materials from its properties. We strongly believe that the actions taken by Mexico are arbitrary and illegal, and we intend to vigorously pursue all lawful avenues available to us in order to protect our rights, under both Mexican and international law. For additional information regarding our Calica operations, see the NAFTA Arbitration section in Note 12 “Commitments and Contingencies” in Item 8 “Financial Statements and Supplementary Data.”
Part II 46
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
AGGREGATES SEGMENT FREIGHT-ADJUSTED REVENUES
Aggregates segment freight-adjusted revenues is not a Generally Accepted Accounting Principle (GAAP) measure and should not be considered as an alternative to metrics defined by GAAP. We present this measure as it is consistent with the basis by which we review our operating results. We believe that this presentation is consistent with our competitors and meaningful to our investors as it excludes revenues associated with freight & delivery, which are pass-through activities. It also excludes other revenues related to services, such as landfill tipping fees, that are derived from our aggregates business. Additionally, we use this metric as the basis for calculating the average sales price of our aggregates products. Reconciliation of this metric to its nearest GAAP measure is presented below:
in millions, except per ton data 2024 2023 2022
Aggregates segment
Segment sales $ 5,949.6 $ 5,918.9 $ 5,280.6
Freight & delivery revenues 1
(1,220.1) (1,350.2) (1,291.3)
Other revenues (93.3) (107.4) (106.3)
Freight-adjusted revenues $ 4,636.2 $ 4,461.3 $ 3,883.0
Unit shipments - tons 219.9 234.6 236.6
Freight-adjusted sales price $ 21.08 $ 19.02 $ 16.41
1At the segment level, freight & delivery revenues include intersegment freight & delivery (which are eliminated at the consolidated level) and freight to remote distribution sites.
Part II 47
CASH GROSS PROFIT
GAAP does not define “cash gross profit,” and it should not be considered as an alternative to earnings measures defined by GAAP. We and the investment community use this metric to assess the operating performance of our business. Additionally, we present this metric as we believe that it closely correlates to long-term shareholder value. Cash gross profit adds back noncash charges for depreciation, depletion, accretion and amortization to gross profit. Segment cash gross profit per unit is computed by dividing segment cash gross profit by units shipped. Segment cash cost of sales per unit is computed by subtracting segment cash gross profit per unit from segment freight-adjusted sales price. Segment freight-adjusted sales price is calculated by dividing revenues generated from the shipment of product (excluding service revenues generated by the segments) by the total units of the product shipped. Reconciliation of these metrics to their nearest GAAP measures are presented below:
in millions, except per unit data 2024 2023 2022
Aggregates segment
Gross profit $ 1,816.7 $ 1,736.8 $ 1,411.1
Depreciation, depletion, accretion and amortization 515.7 482.3 441.3
Cash gross profit $ 2,332.4 $ 2,219.1 $ 1,852.4
Unit shipments - tons 219.9 234.6 236.6
Gross profit per ton $ 8.26 $ 7.40 $ 5.96
Freight-adjusted sales price $ 21.08 $ 19.02 $ 16.41
Cash gross profit per ton 10.61 9.46 7.83
Freight-adjusted cash cost of sales per ton $ 10.47 $ 9.56 $ 8.58
Asphalt segment
Gross profit $ 170.1 $ 149.6 $ 57.3
Depreciation, depletion, accretion and amortization 44.1 35.6 35.1
Cash gross profit $ 214.2 $ 185.2 $ 92.4
Unit shipments - tons 13.6 13.4 12.2
Gross profit per ton $ 12.55 $ 11.16 $ 4.71
Average sales price $ 80.09 $ 75.76 $ 71.29
Cash gross profit per ton 15.81 13.81 7.60
Cash cost of sales per ton $ 64.28 $ 61.95 $ 63.69
Concrete segment
Gross profit $ 12.8 $ 62.1 $ 89.3
Depreciation, depletion, accretion and amortization 45.5 72.8 83.1
Cash gross profit $ 58.3 $ 134.9 $ 172.4
Unit shipments - cubic yards 3.6 7.5 10.5
Gross profit per cubic yard $ 3.60 $ 8.32 $ 8.48
Average sales price $ 182.93 $ 166.95 $ 150.82
Cash gross profit per cubic yard 16.35 18.08 16.36
Cash cost of sales per cubic yard $ 166.58 $ 148.87 $ 134.46
Part II 48
EBITDA AND ADJUSTED EBITDA
GAAP does not define “Earnings Before Interest, Taxes, Depreciation and Amortization” (EBITDA), and it should not be considered as an alternative to earnings measures defined by GAAP. We use this metric to assess the operating performance of our business and as a basis for strategic planning and forecasting as we believe that it closely correlates to long-term shareholder value. We do not use this metric as a measure to allocate resources. We adjust EBITDA for certain items to provide a more consistent comparison of earnings performance from period to period. Reconciliation of this metric to its nearest GAAP measure is presented below (numbers may not foot due to rounding):
in millions 2024 2023 2022
Net earnings attributable to Vulcan $ 911.9 $ 933.2 $ 575.6
Income tax expense, including discontinued operations 248.8 295.6 186.5
Interest expense, net of interest income 170.3 179.6 168.4
Depreciation, depletion, accretion and amortization 632.2 617.0 587.5
EBITDA $ 1,963.2 $ 2,025.4 $ 1,517.9
Loss on discontinued operations $ 10.2 $ 14.7 $ 25.2
Gain on sale of real estate and businesses, net (36.7) (67.1) (6.1)
Loss on impairments 86.6 28.3 67.8
Charges associated with divested operations 17.7 7.9 3.8
Acquisition related charges 1
16.3 2.1 17.1
Adjusted EBITDA $ 2,057.2 $ 2,011.3 $ 1,625.6
1Represents charges associated with acquisitions requiring clearance under federal antitrust laws. Wake Stone acquisition related costs in 2024 include acquisition related expenses of $3.8 million and the cost impact of purchase accounting inventory valuations of $6.4 million. Superior acquisition related costs in 2024 include acquisition related expenses of $4.7 million (see Note 19 for additional information).
ADJUSTED DILUTED EPS ATTRIBUTABLE TO VULCAN FROM CONTINUING OPERATIONS
Similar to our presentation of Adjusted EBITDA, we present Adjusted diluted earnings per share (EPS) attributable to Vulcan from continuing operations to provide a more consistent comparison of earnings performance from period to period. This metric is not defined by GAAP and should not be considered as an alternative to earnings measures defined by GAAP. Reconciliation of this metric to its nearest GAAP measure is presented below:
2024 2023 2022
Diluted Earnings Per Share
Net earnings attributable to Vulcan $ 6.85 $ 6.98 $ 4.31
Items included in Adjusted EBITDA above, net of tax 0.68 (0.08) 0.69
NOL carryforward valuation allowance 0.00 0.10 0.11
Adjusted diluted EPS attributable to Vulcan from continuing operations $ 7.53 $ 7.00 $ 5.11
NET DEBT TO ADJUSTED EBITDA
Net debt to Adjusted EBITDA is not a GAAP measure and should not be considered as an alternative to metrics defined by GAAP. We, the investment community and credit rating agencies use this metric to assess our leverage. Net debt subtracts cash and cash equivalents and restricted cash from total debt. Reconciliation of this metric to its nearest GAAP measure is presented below:
in millions 2024 2023
Current maturities of long-term debt $ 400.5 $ 0.5
Long-term debt 4,906.9 3,877.3
Total debt $ 5,307.4 $ 3,877.8
Cash and cash equivalents and restricted cash (600.8) (949.2)
Net debt $ 4,706.6 $ 2,928.6
Adjusted EBITDA $ 2,057.2 $ 2,011.3
Total Debt to Adjusted EBITDA 2.6x 1.9x
Net Debt to Adjusted EBITDA 2.3x 1.5x
Part II 49
RETURN ON INVESTED CAPITAL
We define “Return on Invested Capital” (ROIC) as Adjusted EBITDA for the trailing-twelve months divided by average invested capital (as illustrated below) during the trailing-five quarters. Our calculation of ROIC is considered a non-GAAP financial measure because we calculate ROIC using the non-GAAP metric EBITDA. We believe that our ROIC metric is meaningful because it helps investors assess how effectively we are deploying our assets. Although ROIC is a standard financial metric, numerous methods exist for calculating a company’s ROIC. As a result, the method we use to calculate our ROIC may differ from the methods used by other companies. This metric is not defined by GAAP and should not be considered as an alternative to earnings measures defined by GAAP. Reconciliation of this metric to its nearest GAAP measure is presented below (numbers may not foot due to rounding):
dollars in millions 2024 2023 2022
Adjusted EBITDA $ 2,057.2 $ 2,011.3 $ 1,625.6
Average invested capital
Property, plant & equipment, net $ 6,743.6 $ 6,106.3 $ 5,810.4
Goodwill 3,567.6 3,626.5 3,708.5
Other intangible assets 1,506.4 1,593.4 1,737.5
Fixed and intangible assets $ 11,817.6 $ 11,326.2 $ 11,256.4
Current assets $ 2,177.5 $ 2,192.9 $ 1,898.8
Cash and cash equivalents (479.2) (352.8) (161.3)
Current tax (37.2) (32.7) (47.2)
Adjusted current assets 1,661.1 1,807.4 1,690.3
Current liabilities (860.7) (833.7) (1,002.1)
Current maturities of long-term debt 80.5 0.5 2.1
Short-term debt 19.0 20.0 137.6
Adjusted current liabilities (761.2) (813.2) (862.4)
Adjusted net working capital $ 899.9 $ 994.2 $ 827.9
Average invested capital $ 12,717.5 $ 12,320.4 $ 12,084.3
Return on invested capital 16.2 % 16.3 % 13.5 %
2025 PROJECTED EBITDA
Projected EBITDA is not defined by GAAP and should not be considered as an alternative to earnings measures defined by GAAP. Reconciliation of this metric to its nearest GAAP measure is presented below:
in millions 2025 Projected Mid-Point 1
Net earnings attributable to Vulcan $ 1,090
Income tax expense, including discontinued operations 315
Interest expense, net of interest income 245
Depreciation, depletion, accretion and amortization 800
Projected EBITDA $ 2,450
1See the Market Developments and Outlook section (earlier within this Item 7) for the assumptions used to build this projection.
Because GAAP financial measures on a forward-looking basis are not accessible, and reconciling information is not available without unreasonable effort, we have not provided reconciliations for forward-looking non-GAAP measures, other than the reconciliation of Projected EBITDA as noted above. For the same reasons, we are unable to address the probable significance of the unavailable information, which could be material to future results.
Part II 50
LIQUIDITY AND FINANCIAL RESOURCES
Our primary sources of liquidity are cash provided by our operating activities, a substantial, committed bank line of credit and our commercial paper program. Additional sources of capital include access to the capital markets, the sale of surplus real estate and dispositions of nonstrategic operating assets. We believe these financial resources are sufficient to fund our business requirements for 2025, including:
▪contractual obligations
▪capital expenditures
▪debt service obligations
▪dividend payments
▪potential acquisitions
▪potential share repurchases
Our future contractual payments as of December 31, 2024 are summarized in the table below:
Note
Reference Payments Due by Year
in millions 2025 2026-2029 Thereafter Total
Contractual Obligations
Bank line of credit
Principal payments Note 6 $ 0.0 $ 0.0 $ 0.0 $ 0.0
Interest payments and fees1
Note 6 2.8 10.4 0.0 13.2
Commercial paper
Principal payments Note 6 0.0 550.0 0.0 550.0
Interest payments
Note 6 24.8 81.9 0.0 106.7
Term debt
Principal payments Note 6 400.5 900.4 3,540.2 4,841.1
Interest payments Note 6 222.9 829.9 2,359.8 3,412.6
Operating leases 2
Note 7 74.9 194.3 210.4 479.6
Finance leases 2
Note 7 10.9 9.9 0.0 20.8
Mineral royalties Note 12 27.5 73.4 136.7 237.6
Unconditional purchase obligations
Capital Note 12 78.2 0.0 0.0 78.2
Noncapital 3
Note 12 42.4 98.4 6.0 146.8
Benefit plans 4
Note 10 18.5 51.2 45.1 114.8
Total contractual obligations 5
$ 903.4 $ 2,799.8 $ 6,298.2 $ 10,001.4
1Includes fees for unused borrowing capacity and fees for standby letters of credit. The figures for all years assume that the amount of unused borrowing capacity and the amount of standby letters of credit do not change from December 31, 2024.
2Excludes lease renewal options which are included in the table labeled Maturity of Lease Liabilities in Note 7 “Leases” in Item 8 “Financial Statements and Supplementary Data.”
3Noncapital unconditional purchase obligations relate primarily to transportation and electricity contracts.
4Payments in “Thereafter” column for benefit plans are for the years 2030-2034. The future contributions are based on current economic conditions and may vary based on future interest rates, asset performance, participant longevity and other plan experience.
5Excludes discounted asset retirement obligations in the amount of $427.4 million at December 31, 2024, the majority of which have an estimated settlement date beyond 2029 (see Note 17 “Asset Retirement Obligations” in Item 8 “Financial Statements and Supplementary Data”).
During 2025, we expect to spend between $750 million and $800 million in total on capital expenditures, including growth projects.
As of December 31, 2024, we were contingently liable for $863.6 million within 463 surety bonds underwritten by various surety companies. These bonds guarantee our performance and are required primarily by states and municipalities and their related agencies. The top five in amount totaled $210.8 million (24%) and were for certain construction contracts and reclamation obligations. We have agreed to indemnify the underwriting companies against any exposure under the surety bonds. No material claims have been made against our surety bonds.
We have no material off-balance sheet arrangements, such as financing or unconsolidated variable interest entities.
Our balanced approach to capital deployment remains unchanged. We intend to balance reinvestment in our business, growth through acquisitions and return of capital to shareholders, while sustaining financial strength and flexibility.
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We actively manage our capital structure and resources in order to balance the cost of capital and the risk of financial stress. We seek to meet these objectives by adhering to the following principles:
▪maintain substantial bank line of credit borrowing capacity
▪proactively manage our debt maturity schedule such that repayment/refinancing risk in any single year is low
▪maintain an appropriate balance of fixed-rate and floating-rate debt
▪minimize financial and other covenants that limit our operating and financial flexibility
We will continue to assess our liquidity sources and needs in order to take appropriate actions to meet our objectives.
CASH
Included in our December 31, 2024 cash and cash equivalents and restricted cash balances of $600.8 million is $41.1 million of restricted cash (see Note 1 “Summary of Significant Accounting Policies” in Item 8 “Financial Statements and Supplementary Data” under the caption "Restricted Cash").
CASH FROM OPERATING ACTIVITIES
in millions
Net cash provided by operating activities is derived primarily from net earnings before noncash deductions for depreciation, depletion, accretion and amortization.
in millions 2024 2023 2022
Net earnings $ 913.1 $ 934.9 $ 576.5
Depreciation, depletion, accretion and amortization 632.2 617.0 587.5
Loss on impairments 86.6 28.3 67.9
Noncash operating lease expense 51.4 53.9 60.3
Net gain on sale of property, plant & equipment and businesses (52.3) (76.4) (10.7)
Deferred income taxes, net (9.4) (43.3) 57.7
Other operating cash flows, net 1
(212.0) 22.4 (191.0)
Net cash provided by operating activities $ 1,409.6 $ 1,536.8 $ 1,148.2
1Primarily reflects changes to working capital balances.
2024 VERSUS 2023 - Net cash provided by operating activities was $1,409.6 million during 2024, a $127.2 million decrease compared to 2023 which primarily resulted from changes in working capital balances.
Days sales outstanding, a measurement of the time it takes to collect receivables, were 45.6 days at December 31, 2024 compared to 46.1 days at December 31, 2023. Our over 90 day receivables balance of $29.6 million at December 31, 2024 was $2.0 million higher than the December 31, 2023 balance of $27.6 million. All customer accounts are actively managed, and no losses in excess of amounts reserved are currently expected.
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CASH FROM INVESTING ACTIVITIES
in millions
2024 VERSUS 2023 - Net cash used for investing activities was $2,814.9 million during 2024, a $2,651.4 million increase compared to 2023. During 2024, we acquired businesses for $2,266.2 million of cash consideration whereas there were no business acquisitions in 2023. Additionally, proceeds from the sale of property, plant & equipment and businesses were down $653.3 million in 2024 from the prior year, which includes cash proceeds from the sale of our concrete operations in Texas and the collection of a note receivable related to the 2022 sale of concrete operations in New Jersey, New York and Pennsylvania (see Note 19 “Acquisitions and Divestitures” in Item 8 “Financial Statements and Supplementary Data” for further information). Partially offsetting these net increases to cash used for investing activities, during 2024, we invested $603.5 million in our existing operations (includes changes in accruals for property, plant & equipment), a $269.1 million decrease compared to 2023. This $603.5 million investment includes both maintenance and internal growth projects to enhance our distribution capabilities, develop new production sites and improve existing production facilities.
CASH FROM FINANCING ACTIVITIES
in millions
2024 VERSUS 2023 - Net cash provided by financing activities in 2024 was $1,056.9 million, compared to $585.6 million of cash used in 2023. The current year includes proceeds of $2,000.0 million from the issuance of senior notes and cash paid to redeem the $550.0 million senior notes due 2026 (see Note 6 "Debt" in Item 8 “Financial Statements and Supplementary Data”). The prior year includes a $100.0 million net payment on our line of credit. Additionally, we returned $313.2 million to shareholders (a $115.2 million decrease compared to the prior year due to lower share repurchases) through $244.4 million of dividends ($1.84 per share compared to $1.72 per share) and $68.8 million of common stock repurchases (270,142 shares repurchased at $254.71 average price per share compared to 977,591 shares repurchased at $204.52 average price per share).
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DEBT
Certain debt measures as of December 31 are outlined below:
dollars in millions 2024 2023
Debt
Current maturities of long-term debt $ 400.5 $ 0.5
Long-term debt 4,906.9 3,877.3
Total debt $ 5,307.4 $ 3,877.8
Capital
Total debt $ 5,307.4 $ 3,877.8
Total equity 8,142.5 7,507.9
Total capital $ 13,449.9 $ 11,385.7
Total Debt as a Percentage of Total Capital 39.5 % 34.1 %
Weighted-Average Effective Interest Rates
Line of credit 1
1.13 % 1.13 %
Commercial paper 4.65 % 5.64 %
Term debt 5.00 % 4.82 %
Fixed Versus Floating Interest Rate Debt
Fixed-rate debt 89.8 % 72.1 %
Floating-rate debt 10.2 % 27.9 %
1Reflects the margin above SOFR for SOFR-based borrowings; we also paid upfront fees that are amortized to interest expense and pay fees for unused borrowing capacity and standby letters of credit.
At December 31, 2024, total debt to Adjusted EBITDA was 2.6 times (2.3 times on a net debt basis reflecting $600.8 million of cash on hand). Our weighted-average debt maturity was 12.6 years, and our total weighted-average effective interest rate was 4.97%.
LINE OF CREDIT AND COMMERCIAL PAPER PROGRAM
Our $1,600.0 million commercial paper program was established in August 2022 and matures in November 2029. Commercial paper borrowings bear interest at rates determined at the time of borrowing and as agreed between us and the commercial paper investors. As of December 31, 2024, we had $550.0 million in long-term commercial paper borrowings.
Our $1,600.0 million unsecured line of credit was amended in November 2024 to extend the maturity date from August 2027 to November 2029. Our line of credit contains covenants customary for an unsecured investment-grade facility. Covenants, borrowings, cost ranges and other details are described in Note 6 “Debt” in Item 8 “Financial Statements and Supplementary Data.” As of December 31, 2024, we were in compliance with the line of credit covenants, the margin for Secured Overnight Financing Rate (SOFR) borrowings was 1.125%, the margin for base rate borrowings was 0.125% and the commitment fee for the unused amount was 0.100%.
As of December 31, 2024, our available borrowing capacity under the line of credit was $1,504.8 million. Utilization of the borrowing capacity was as follows:
▪None was borrowed
▪$95.2 million was used to support standby letters of credit
TERM DEBT
All of our $5,391.1 million (face value) of term debt (which includes the $550.0 million commercial paper) is unsecured. All of the covenants in the debt agreements are customary for investment-grade facilities. As of December 31, 2024, we were in compliance with all term debt covenants.
In March 2023, we issued $550.0 million of 5.80% senior notes due 2026. We redeemed these notes at par in March 2024 using cash on hand and recognized noncash expense of $2.3 million with the acceleration of unamortized deferred debt issuance costs.
In November 2024, we entered into a $2,000.0 million unsecured delayed draw term loan which was partially drawn in November 2024 upon the acquisition of Wake Stone. Subsequently, the delayed draw term loan balance was fully repaid and terminated in November 2024 using proceeds from the issuance of senior notes as described below.
In November 2024, we issued $500.0 million of 4.95% senior notes due 2029, $750.0 million of 5.35% senior notes due 2034 and $750.0 million of 5.70% senior notes due 2054. Total proceeds of $1,975.0 million (net of discounts and transaction costs), together with cash on hand, were used to repay the outstanding balance on the $2,000.0 million delayed draw term loan and to provide liquidity for acquisitions and debt maturing in 2025.
For additional information regarding term debt, see Note 6 “Debt” in Item 8 “Financial Statements and Supplementary Data.”
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DEBT PAYMENTS AND MATURITIES
Scheduled debt payments during 2024 and 2023 were $0.5 million in the first quarter of each year. As of December 31, 2024, maturities for the next four quarters and for the next five years are as follows (excluding any borrowings on the line of credit):
in millions 2025 Debt Maturities in millions Debt Maturities
First Quarter $ 0.5 2025 $ 400.5
Second Quarter 400.0 2026 0.4
Third Quarter 0.0 2027 400.0
Fourth Quarter 0.0 2028 0.0
2029 1,050.0
Subsequent to year end, in February 2025 we delivered a notice of redemption to holders of our 4.50% senior notes due 2025, providing for the full redemption of the $400.0 million aggregate principal amount of these notes. We expect to complete this redemption in March 2025 using existing cash on hand.
For additional information regarding debt payments and maturities, see Note 6 “Debt” in Item 8 “Financial Statements and Supplementary Data.”
DEBT RATINGS
Our debt ratings and outlooks as of December 31, 2024 are as follows:
Short-term Long-term Outlook
Fitch BBB Positive
Moody's P-2 Baa2 Stable
Standard & Poor's A-2 BBB+ Stable
EQUITY
The number of our common stock issuances and purchases are as follows:
in millions 2024 2023 2022
Common stock shares at January 1, issued and outstanding 132.1 132.9 132.7
Common stock issued for share-based compensation plans 0.3 0.2 0.2
Common stock purchased and retired (0.3) (1.0) 0.0
Common stock shares at December 31, issued and outstanding
132.1 132.1 132.9
As of December 31, 2024, there were 6,817,118 shares remaining under the February 2017 share purchase authorization by our Board of Directors. Depending upon market, business, legal and other conditions, we may purchase shares from time to time through the open market (including plans designed to comply with Rule 10b5-1 of the Securities Exchange Act of 1934) and/or privately negotiated transactions. The authorization has no time limit, does not obligate us to purchase any specific number of shares and may be suspended or discontinued at any time.
The detail of our common stock purchases (all of which were open market purchases) are as follows:
in millions, except average cost 2024 2023 2022
Number of shares purchased and retired 0.3 1.0 0.0
Total purchase price $ 68.8 $ 200.0 $ 0.0
Average cost per share $ 254.71 $ 204.52 $ 0.00
There were no shares held in treasury as of December 31, 2024, 2023 and 2022.
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STANDBY LETTERS OF CREDIT
For a discussion of our standby letters of credit, see Note 6 “Debt” in Item 8 “Financial Statements and Supplementary Data."
CRITICAL ACCOUNTING POLICIES
We follow certain significant accounting policies when preparing our consolidated financial statements. A summary of these policies is included in Note 1 “Summary of Significant Accounting Policies” in Item 8 “Financial Statements and Supplementary Data.”
We prepare these financial statements to conform with accounting principles generally accepted in the United States of America. These principles require us to make estimates and judgments that affect reported amounts of assets, liabilities, revenues and expenses, and the related disclosures of contingent assets and contingent liabilities at the date of the financial statements. We base our estimates on historical experience, current conditions and various other assumptions we believe reasonable under existing circumstances and evaluate these estimates and judgments on an ongoing basis. The results of these estimates form the basis for our judgments about the carrying values of assets and liabilities as well as identifying and assessing the accounting treatment with respect to commitments and contingencies. Our actual results may materially differ from these estimates.
We believe the following critical accounting policies require the most significant judgments and estimates used in the preparation of our consolidated financial statements:
1.Goodwill impairment
2.Impairment of long-lived assets excluding goodwill
3.Business combinations and purchase price allocation
4.Pension and other postretirement benefits
5.Environmental compliance costs
6.Claims and litigation including self-insurance
7.Income taxes
1.GOODWILL IMPAIRMENT
Goodwill represents the excess of the cost of net assets acquired in business combinations over the fair value of the identifiable tangible and intangible assets acquired and liabilities assumed in a business combination. Goodwill impairment exists when the fair value of a reporting unit is less than its carrying amount. Goodwill is tested for impairment annually, as of November 1, or more frequently whenever events or changes in circumstances would more likely than not reduce the fair value of a reporting unit below its carrying amount. The impairment evaluation is a critical accounting policy because goodwill is material to our total assets (as of December 31, 2024, goodwill represents 22% of total assets), and the evaluation involves the use of significant estimates, assumptions and judgment.
HOW WE TEST GOODWILL FOR IMPAIRMENT
Goodwill is tested for impairment at the reporting unit level, one level below our operating segments. We have identified 14 reporting units (of which 10 carry goodwill) based primarily on geographic location. We have the option of either assessing qualitative factors to determine whether it is more likely than not that the carrying value of our reporting units exceeds their respective fair value or proceeding directly to a quantitative test. We elected to perform the quantitative impairment test for all years presented.
The quantitative impairment test compares the fair value of a reporting unit to its carrying value, including goodwill. If the fair value exceeds its carrying value, the goodwill of the reporting unit is not considered impaired. However, if the carrying value of a reporting unit exceeds its fair value, we recognize an impairment loss equal to that excess.
HOW WE DETERMINE CARRYING VALUE AND FAIR VALUE
We determine the carrying value of each reporting unit by assigning assets and liabilities, including goodwill, to those units as of the measurement date. We estimate the fair values of the reporting units using both an income approach (which involves discounting estimated future cash flows) and a market approach (which involves the application of revenue and EBITDA multiples of comparable companies). We consider market factors when determining the assumptions and estimates used in our valuation models. Finally, to assess the reasonableness of the reporting unit fair values, we compare the total of the reporting unit fair values to our market capitalization.
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OUR FAIR VALUE ASSUMPTIONS
We base our fair value estimates on market participant assumptions we believe to be reasonable at the time, but such assumptions are subject to inherent uncertainty and actual results may differ. Changes in key assumptions or management judgment with respect to a reporting unit or its prospects may result from a change in market conditions, market trends, interest rates or other factors outside of our control, or underperformance relative to historical or projected operating results. These conditions could result in a significantly different estimate of the fair value of our reporting units which could result in an impairment charge in the future.
The significant assumptions in our discounted cash flow models include our estimate of future profitability, capital requirements and the discount rate. The profitability estimates used in the models were derived from internal operating budgets and forecasts for long-term demand and pricing in our industry. Estimated capital requirements reflect replacement capital estimated on a per unit basis and, if applicable, acquisition capital necessary to support growth estimated in the models. The discount rate was derived using a capital asset pricing model.
RESULTS OF OUR IMPAIRMENT TESTS
Prior to our annual impairment test in 2022, we recorded an interim goodwill impairment loss of $50.9 million related to the sale of a reporting unit comprised of concrete operations in New Jersey, New York and Pennsylvania. The results of our annual impairment test for 2022 indicated that the estimated fair values of two other Concrete segment reporting units exceeded carrying values by less than 15%. One of those Concrete segment reporting units was sold during the fourth quarter of 2023. The results of our annual impairment test for 2023 indicated that the estimated fair value of the other Concrete segment reporting unit exceeded carrying value by less than 5%. During the third quarter of 2024, we determined that a triggering event had occurred with respect to this reporting unit. Based on an interim goodwill impairment test, we determined that the estimated fair value of this reporting unit was less than its carrying value. As a result, we recorded an $86.6 million noncash impairment charge. The results of our annual impairment test for 2024 indicated that the estimated fair values of all reporting units with goodwill substantially exceeded their carrying values.
For additional information about goodwill, see Note 18 “Goodwill and Intangible Assets” and Note 19 “Acquisitions and Divestitures” in Item 8 “Financial Statements and Supplementary Data.”
2.IMPAIRMENT OF LONG-LIVED ASSETS EXCLUDING GOODWILL
We evaluate the carrying value of long-lived assets, including intangible assets subject to amortization, when events and circumstances indicate that the carrying value may not be recoverable. The impairment evaluation is a critical accounting policy because long-lived assets are material to our total assets (as of December 31, 2024, net property, plant & equipment represents 49% of total assets while net other intangible assets represents 10% of total assets), and the evaluation involves the use of significant estimates, assumptions and judgment. The carrying value of long-lived assets is considered impaired when the estimated undiscounted cash flows from such assets are less than their carrying value. In that event, we perform a fair value analysis and recognize a loss equal to the amount by which the carrying value exceeds the fair value.
Fair value is estimated primarily by using a discounted cash flow methodology that requires considerable judgment and assumptions. Our estimate of net future cash flows is based on historical experience and assumptions of future trends which may be different from actual results. We periodically review the appropriateness of the estimated useful lives of our long-lived assets.
We test long-lived assets for impairment at a significantly lower level than the level at which we test goodwill for impairment. In markets where we do not produce downstream products (e.g., asphalt mix and ready-mixed concrete), the lowest level of largely independent identifiable cash flows is at the individual aggregates operation or a group of aggregates operations collectively serving a local market or remote markets through our rail and water distribution networks. Conversely, in vertically integrated markets, the cash flows of our downstream and upstream businesses are not largely independently identifiable as the selling price of the upstream products (aggregates) impacts the profitability of the downstream business.
During 2024, we recorded no significant losses on impairment of long-lived assets. During the third quarter of 2023, we recognized a long-lived asset impairment loss of $28.3 million for assets classified as held for sale (subsequently sold during the fourth quarter). In addition, during the third quarter of 2022, we recognized a long-lived asset impairment loss of $16.9 million for assets classified as held for sale (subsequently sold during the fourth quarter of 2022). Refer to Note 19 “Acquisitions and Divestitures” in Item 8 “Financial Statements and Supplementary Data” for further information.
We maintain certain long-lived assets that are not currently being used in our operations. These assets totaled $609.1 million at December 31, 2024, representing a 14% increase from December 31, 2023. Of the total $609.1 million, approximately 35% relates to real estate held for future development and expansion of our operations. In addition, approximately 15% is comprised of real estate (principally former mining sites) pending development as commercial or residential real estate, reservoirs or landfills. The remaining 50% is composed of aggregates, asphalt and concrete operating assets idled temporarily. We evaluate the useful lives and the recoverability of these assets whenever events or changes in circumstances indicate that carrying amounts may not be recoverable.
For additional information about long-lived assets and intangible assets, see Note 4 “Property, Plant & Equipment” and Note 18 “Goodwill and Intangible Assets” in Item 8 “Financial Statements and Supplementary Data.”
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3.BUSINESS COMBINATIONS AND PURCHASE PRICE ALLOCATION
Our strategic long-term plans include potential investments in value-added acquisitions of related or similar businesses. When an acquisition is completed, our consolidated statements of comprehensive income include the operating results of the acquired business starting from the date of acquisition, which is the date that control is obtained.
HOW WE DETERMINE AND ALLOCATE THE PURCHASE PRICE
The purchase price is determined based on the fair value of consideration transferred to and liabilities assumed from the seller as of the date of acquisition. We allocate the purchase price to the fair values of the tangible and identifiable intangible assets acquired and liabilities assumed as of the date of acquisition. Goodwill is recorded for the excess of the purchase price over the net fair value of the identifiable assets acquired and liabilities assumed. The purchase price allocation is a critical accounting policy because the estimation of fair values of acquired assets and assumed liabilities is judgmental and requires various assumptions. Additionally, the amounts assigned to depreciable and amortizable assets compared to amounts assigned to goodwill, which is not amortized, can significantly affect our results of operations.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction and therefore represents an exit price. A fair value measurement assumes the highest and best use of the asset by market participants. The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels as described below:
Level 1: Quoted prices in active markets for identical assets or liabilities
Level 2: Inputs that are derived principally from or corroborated by observable market data
Level 3: Inputs that are unobservable and significant to the overall fair value measurement
Level 1 fair values are used to value investments in publicly-traded entities and assumed obligations for publicly-traded long-term debt.
Level 2 fair values are typically used to value acquired machinery and equipment, land, buildings, and assumed liabilities for asset retirement obligations, environmental remediation and compliance obligations. Additionally, Level 2 fair values are typically used to value assumed contracts at other-than-market rates.
Level 3 fair values are used to value acquired mineral reserves as well as leased mineral interests (referred to in our financial statements as contractual rights in place) and other identifiable intangible assets. We determine the fair values of owned mineral reserves and leased mineral interests using a lost profits approach and/or an excess earnings approach. These valuation techniques require management to estimate future cash flows. The estimate of future cash flows is based on available historical information and future expectations and assumptions determined by management but is inherently uncertain. Key assumptions in estimating future cash flows include sales price, shipment volumes, production costs and capital needs. The present value of the projected net cash flows represents the fair value assigned to mineral reserves and mineral interests. The discount rate is a significant assumption used in the valuation model and is based on the required rate of return that a hypothetical market participant would assume if purchasing the acquired business, with an adjustment for the risk of these assets not generating the projected cash flows.
Other identifiable intangible assets may include, but are not limited to, patents, tradenames and trademarks. The fair values of these assets are typically determined by an excess earnings method, a replacement cost method or a market approach.
MEASUREMENT PERIOD ADJUSTMENTS
We may adjust the amounts recognized in an acquisition during a measurement period after the acquisition date. Any such adjustments are the result of subsequently obtaining additional information that existed at the acquisition date regarding the assets acquired or the liabilities assumed. Measurement period adjustments are generally recorded as increases or decreases to goodwill, if any, recognized in the transaction. The cumulative impact of measurement period adjustments on depreciation, amortization and other income statement items are recognized in the period the adjustment is determined. The measurement period ends once we have obtained all necessary information that existed as of the acquisition date but does not extend beyond one year from the date of acquisition. Any adjustments to assets acquired or liabilities assumed beyond the measurement period, unless as a result of an error, are recorded through earnings.
For additional information about business combinations and purchase price allocations, see Note 19 “Acquisitions and Divestitures” in Item 8 “Financial Statements and Supplementary Data.”
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4.PENSION AND OTHER POSTRETIREMENT BENEFITS
Accounting for pension and other postretirement benefits requires that we use assumptions for the valuation of projected benefit obligations (PBO) and the performance of plan assets. The valuation is a critical accounting policy because pension and other postretirement benefit obligations and plan assets are material to our balance sheet. Each year, we review our assumptions for discount rates (used for PBO, service cost and interest cost calculations), expected return on plan assets and the cost of covered healthcare benefits. Due to plan changes made in 2013, annual pay increases do not materially impact plan obligations.
▪Discount Rates - We use a high-quality bond full yield curve approach (specific spot rates for each annual expected cash flow) to establish the discount rates at each measurement date.
▪Expected Return on Plan Assets - Our expected return on plan assets is a long-term view based on our current asset allocation and a judgment informed by consultation with our retirement plans’ consultant and our pension plans’ actuary.
▪Rate of Increase in the Per Capita Cost of Covered Healthcare Benefits - We project the expected increases in the cost of covered healthcare benefits.
Refer to Note 10 “Benefit Plans” in Item 8 “Financial Statements and Supplementary Data” for the discount rates used for PBO, service cost and interest cost calculations; the expected return on plan assets; and the rate of increase in the per capita cost of healthcare benefits.
Changes to the assumptions listed above would have an impact on the PBO and the annual net benefit cost. The following table reflects the favorable and unfavorable outcomes associated with a change in certain assumptions:
(Favorable) Unfavorable
0.5 Percentage Point Increase 0.5 Percentage Point Decrease
in millions Inc (Dec) in
Benefit Obligation Inc (Dec) in
Annual Benefit Cost Inc (Dec) in
Benefit Obligation Inc (Dec) in
Annual Benefit Cost
Actuarial Assumptions
Discount rates
Pension $ (28.1) $ 0.2 $ 30.5 $ (0.2)
Other postretirement benefits (1.4) (0.2) 1.5 0.2
Expected return on plan assets not applicable (2.9) not applicable 2.9
As of the December 31, 2024 measurement date, the fair value of our pension plan assets decreased from $647.9 million for the prior year-end to $607.1 million primarily due to an increase in the level of intermediate and long-term bond yields during the year.
The discount rate is the weighted-average of the spot rates for each cash flow on the yield curve for high-quality bonds as of the measurement date. As of the December 31, 2024 measurement date, the PBO of our pension plans decreased from $693.3 million to $640.8 million. This decrease was primarily due to the increase in discount rates for the plans (approximately 0.7 percentage points). The PBO of our postretirement plans decreased from $44.2 million to $42.2 million. This decrease was primarily due to the increase in discount rates for the plans (approximately 0.6 percentage points) and favorable claims experience.
During 2025, we expect to recognize net pension expense of $8.9 million and net postretirement expense of $4.9 million compared to expense of $13.2 million and expense of $5.1 million, respectively, in 2024. The expected decrease in pension expense is primarily due to the increase in the expected return on plan assets, and the expected decrease in postretirement expense is primarily due to the increase in discount rates and favorable claims experience.
We anticipate that contributions totaling approximately $9.6 million to the funded pension plans will be required during 2025, and we do not anticipate making a discretionary contribution. We currently do not anticipate that the funded status of any of our plans will fall below statutory thresholds requiring accelerated funding or constraints on benefit levels or plan administration.
For additional information about pension and other postretirement benefits, see Note 10 “Benefit Plans” in Item 8 “Financial Statements and Supplementary Data.”
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5.ENVIRONMENTAL COMPLIANCE COSTS
Our environmental compliance costs include the cost of ongoing monitoring programs, the cost of remediation efforts and other similar costs. Our accounting policy for environmental compliance costs is a critical accounting policy because it involves the use of significant estimates and assumptions and requires considerable management judgment.
HOW WE ACCOUNT FOR ENVIRONMENTAL COSTS
To account for environmental costs, we:
▪expense or capitalize environmental costs consistent with our capitalization policy
▪expense costs for an existing condition caused by past operations that do not contribute to future revenues
▪accrue costs for environmental assessment and remediation efforts when we determine that a liability is probable and we can reasonably estimate the cost
At the early stages of a remediation effort, environmental remediation liabilities are not easily quantified due to the uncertainties of various factors. The range of an estimated remediation liability is defined and redefined as events in the remediation effort occur, but generally liabilities are recognized no later than completion of the remedial feasibility study. When we can estimate a range of probable loss, we accrue the most likely amount. If no amount in the range of probable loss is considered most likely, the minimum loss in the range is accrued. As of December 31, 2024, the difference between the amount accrued and the maximum loss in the range for all sites for which a range can be reasonably estimated was $4.1 million; this amount does not represent our maximum exposure to loss for all environmental remediation obligations as it excludes those sites for which a range of loss cannot be reasonably estimated at this time. Our environmental remediation obligations are recorded on an undiscounted basis.
Accrual amounts may be based on technical cost estimations or the professional judgment of experienced environmental managers. Our Safety, Health and Environmental Affairs Management Committee routinely reviews cost estimates and key assumptions in response to new information, such as the kinds and quantities of hazardous substances, available technologies and changes to the parties participating in the remediation efforts. However, a number of factors, including adverse agency rulings and unanticipated conditions as remediation efforts progress, may cause actual results to differ materially from accrued costs.
For additional information about environmental compliance costs, see Note 8 “Accrued Environmental Remediation Costs” in Item 8 “Financial Statements and Supplementary Data.”
6.CLAIMS AND LITIGATION INCLUDING SELF-INSURANCE
We are involved with claims and litigation, including items covered under our self-insurance program. We are self-insured for losses related to workers' compensation up to $3.0 million per occurrence and automotive and general/product liability up to $10.0 million per occurrence. We have excess coverage on a per occurrence basis beyond these retention levels.
Under our self-insurance program, we aggregate certain claims and litigation costs that are reasonably predictable based on our historical loss experience and accrue losses, including future legal defense costs, based on actuarial studies. Certain claims and litigation costs, due to their unique nature, are not included in our actuarial studies. For matters not included in our actuarial studies, legal defense costs are accrued when incurred.
Our accounting policy for claims and litigation including self-insurance is a critical accounting policy because it involves the use of significant estimates and assumptions and requires considerable management judgment.
HOW WE ASSESS THE PROBABILITY OF LOSS
We use both internal and outside legal counsel to assess the probability of loss, and we establish an accrual when the claims and litigation represent a probable loss and the cost can be reasonably estimated. Significant judgment is used in determining the timing and amount of the accruals for probable losses, and the actual liability could differ materially from the accrued amounts.
For additional information about claims and litigation including self-insurance, see Note 1 “Summary of Significant Accounting Policies” in Item 8 “Financial Statements and Supplementary Data” under the caption "Claims and Litigation Including Self-Insurance."
7.INCOME TAXES
VALUATION OF OUR DEFERRED TAX ASSETS
We file federal, state and foreign income tax returns and account for the current and deferred tax effects of such returns using the asset and liability method. We recognize deferred tax assets and liabilities (which reflect our best assessment of the future taxes we will pay) based on the differences between the book basis and tax basis of assets and liabilities. Deferred tax assets represent items to be used as a tax deduction or credit in future tax returns while deferred tax liabilities represent items that will result in additional tax in future tax returns.
Significant judgments and estimates are required in determining our deferred tax assets and liabilities. These estimates are updated throughout the year to consider income tax return filings, our geographic mix of earnings, legislative changes and other relevant items. We are required to account for the effects of changes in income tax rates on deferred tax balances in the period in which the legislation is enacted.
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Each quarter we analyze the likelihood that our deferred tax assets will be realized. Realization of the deferred tax assets ultimately depends on the existence of sufficient taxable income of the appropriate character in either the carryback or carryforward period. A valuation allowance is recorded if, based on the weight of all available positive and negative evidence, it is more likely than not (a likelihood of more than 50%) that some portion, or all, of a deferred tax asset will not be realized. A summary of our deferred tax assets is included in Note 9 “Income Taxes” in Item 8 “Financial Statements and Supplementary Data.”
LIABILITY FOR UNRECOGNIZED TAX BENEFITS
We recognize a tax benefit associated with a tax position when we judge it is more likely than not that the position will be sustained based upon the technical merits of the position. For a tax position that meets the more likely than not recognition threshold, we measure the income tax benefit as the largest amount that we judge to have a greater than 50% likelihood of being realized. A liability is established for the unrecognized portion of any tax position. Our liability for unrecognized tax benefits is adjusted periodically due to changing circumstances, such as the progress of tax audits, case law developments and new legislation.
Generally, we are not subject to significant changes in income taxes by any taxing jurisdiction for the years before 2021. While it is often difficult to predict the final outcome or the timing of resolution of any particular tax matter, we believe our liability for unrecognized tax benefits is appropriate.
We consider a tax position to be resolved at the earlier of the issue being “effectively settled,” settlement of an examination, or the expiration of the statute of limitations. Upon resolution of a tax position, any liability for unrecognized tax benefits will be released.
Our liability for unrecognized tax benefits is generally presented as noncurrent. However, if we anticipate paying cash within one year to settle an uncertain tax position, the liability is presented as current. We classify interest and penalties associated with our liability for unrecognized tax benefits as income tax expense.
NEW ACCOUNTING STANDARDS
For a discussion of the accounting standards recently adopted or pending adoption and the effect such accounting changes will have on our results of operations, financial position or liquidity, see Note 1 “Summary of Significant Accounting Policies” in Item 8 “Financial Statements and Supplementary Data” under the caption "New Accounting Standards."
FORWARD-LOOKING STATEMENTS
The foregoing discussion and analysis, as well as certain information contained elsewhere in this Annual Report, contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to be covered by the safe harbor created thereby. See the discussion in "Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995" in Part I above.

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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
ITEM 7A
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
MARKET RISK
We are exposed to certain market risks arising from transactions that are entered into in the normal course of business. To manage these market risks, we may use derivative financial instruments. We do not enter into derivative financial instruments for trading or speculative purposes.
As discussed in the Liquidity and Financial Resources section of Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” we actively manage our capital structure and resources to balance the cost of capital and risk of financial stress. Such activity includes balancing the cost and risk of interest expense. In addition to floating-rate borrowings, we at times use interest rate swaps to manage the mix of fixed-rate and floating-rate debt.
At December 31, 2024, the estimated fair value of our long-term debt including current maturities was $5,162.7 million compared to a face value of $5,391.1 million. The estimated fair value was determined by averaging several asking price quotes for the publicly traded notes and assuming par value for the remainder of the debt. The fair value estimate is based on information available as of the balance sheet date. The effect of a decline in interest rates of one percentage point would increase the fair value of our debt by approximately $399.8 million.
We are exposed to certain economic risks related to the costs of our pension and other postretirement benefit plans. These economic risks include changes in the discount rate for high-quality bonds and the expected return on plan assets. The impact of a change in these assumptions on our annual pension and other postretirement benefits costs is discussed in greater detail within the Critical Accounting Policies section of this Annual Report.
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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
ITEM 8
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the shareholders and the Board of Directors of Vulcan Materials Company:
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Vulcan Materials Company and subsidiaries (the “Company”) as of December 31, 2024 and 2023, the related consolidated statements of comprehensive income, equity, and cash flows, for each of the three years in the period ended December 31, 2024, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 20, 2025 expressed an unqualified opinion on the Company's internal control over financial reporting.
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Hewitt Landfill Environmental Matter - Refer to Note 12 to the consolidated financial statements
Critical Audit Matter Description
The Company is subject to governmental proceedings and orders pertaining to the protection of the environment. Specific to the Hewitt Landfill Environmental Matter, management is engaged in groundwater testing, certain remedial procedures and ongoing dialogue with the Environmental Protection Agency (EPA), Los Angeles Regional Water Quality Control Board (RWQCB), Los Angeles Department of Water and Power (LADWP), and Honeywell. The testing and dialogue is related to the Company’s contribution to soil, soil vapor and/or groundwater contamination in the former Hewitt Landfill in Los Angeles and the potential contribution of the Hewitt Landfill to groundwater contamination in the North Hollywood Operable Unit (NHOU) of the San Fernando Valley Superfund Site.
The groundwater treatment system for the Hewitt Landfill on-site remediation is fully operational, and the anticipated costs have been fully accrued for based on facts and circumstances known to the Company at this time. The Company has disclosed facts and circumstances that led to the accrual and the inherent uncertainty that exists in the timing and recognition of potential incremental responsibility or share of costs for the Hewitt Landfill on-site remediation or the NHOU. Due to these uncertainties, future amounts recorded related to the ultimate resolution of claims and assessments could cause actual losses to differ materially from accrued costs.
We identified the Hewitt Landfill and NHOU (collectively the “Hewitt Landfill Environmental Matter” or “the Matter”) as a critical audit matter because evaluating the estimate of the liability and the extent and sufficiency of related disclosures is subjective in nature and as such requires an increased extent of effort, involves especially subjective auditing judgments, and requires the involvement of our environmental specialists.
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How the Critical Audit Matter Was Addressed in the Audit
Our audit procedures related to the uncertainty in the timing, recognition and disclosure of the Company’s responsibility and potential share of remediation costs, specifically as they relate to the Hewitt Landfill Environmental Matter include the following, among others:
▪We tested the operating effectiveness of controls over the identification and evaluation of information available to assess potential responsibility or share of remediation costs for the Hewitt Landfill Environmental Matter, as well as controls over the adequacy of the related financial statement footnote disclosures.
▪With the assistance of our environmental specialists, we evaluated the accuracy and completeness of management’s recorded liabilities for the Hewitt Landfill Environmental Matter by:
▪Independently obtaining and reading correspondence from the EPA, RWQCB and LADWP regarding the Hewitt Landfill Environmental Matter.
▪Obtaining an understanding of the change in estimate of remediation costs, as applicable, and performing procedures to evaluate the appropriateness and sufficiency of the estimate at year-end.
▪Performing a search of environmental records in the public domain from independently and nationally recognized resources.
▪We obtained letters from internal and external counsel as to the Matter’s status, probability of an unfavorable outcome, and the amount or range of potential loss should the outcome be unfavorable.
▪We read and compared the Company’s footnote disclosure to evidential matter obtained during the audit.
/s/ DELOITTE & TOUCHE LLP
Birmingham, Alabama
February 20, 2025
We have served as the Company’s auditor since 1956.
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VULCAN MATERIALS COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
For the Years Ended December 31
in millions, except per share data 2024 2023 2022
Total revenues $ 7,417.7 $ 7,781.9 $ 7,315.2
Cost of revenues (5,418.1) (5,833.4) (5,757.5)
Gross profit 1,999.6 1,948.5 1,557.7
Selling, administrative and general expenses (531.1) (542.8) (515.1)
Gain on sale of property, plant & equipment and businesses 52.3 76.4 10.7
Loss on impairments (86.6) (28.3) (67.9)
Other operating expense, net (69.7) (26.4) (34.0)
Operating earnings 1,364.5 1,427.4 951.4
Other nonoperating income (expense), net (22.1) (2.7) 5.1
Interest income 20.9 16.5 0.8
Interest expense (191.2) (196.1) (169.2)
Earnings from continuing operations before income taxes 1,172.1 1,245.1 788.1
Income tax (expense) benefit
Current (261.3) (343.6) (133.4)
Deferred 9.9 44.2 (59.6)
Total income tax expense (251.4) (299.4) (193.0)
Earnings from continuing operations 920.7 945.7 595.1
Loss on discontinued operations, net of tax (7.6) (10.8) (18.6)
Net earnings 913.1 934.9 576.5
Earnings attributable to noncontrolling interest (1.2) (1.7) (0.9)
Net earnings attributable to Vulcan $ 911.9 $ 933.2 $ 575.6
Other comprehensive income (loss), net of tax
Amortization of accumulated cash flow hedge losses 1.7 1.6 1.5
Adjustment for funded status of benefit plans 9.7 4.2 (6.5)
Amortization of accumulated benefit plan costs 5.0 5.1 3.0
Other comprehensive income (loss) 16.4 10.9 (2.0)
Comprehensive income 929.5 945.8 574.5
Comprehensive earnings attributable to noncontrolling interest (1.2) (1.7) (0.9)
Comprehensive income attributable to Vulcan $ 928.3 $ 944.1 $ 573.6
Basic earnings (loss) per share attributable to Vulcan
Continuing operations $ 6.95 $ 7.10 $ 4.47
Discontinued operations (0.06) (0.08) (0.14)
Net earnings $ 6.89 $ 7.02 $ 4.33
Diluted earnings (loss) per share attributable to Vulcan
Continuing operations $ 6.91 $ 7.06 $ 4.45
Discontinued operations (0.06) (0.08) (0.14)
Net earnings $ 6.85 $ 6.98 $ 4.31
Weighted-average common shares outstanding
Basic 132.3 133.0 133.0
Assuming dilution 133.1 133.7 133.6
The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
Part II 64
VULCAN MATERIALS COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
As of December 31
in millions 2024 2023
Assets
Cash and cash equivalents $ 559.7 $ 931.1
Restricted cash 41.1 18.1
Accounts and notes receivable, net 892.3 889.7
Inventories 681.8 615.6
Other current assets 90.8 70.4
Total current assets 2,265.7 2,524.9
Investments and long-term receivables 31.3 31.3
Property, plant & equipment, net 8,461.5 6,217.7
Operating lease right-of-use assets, net 526.4 511.7
Goodwill 3,788.1 3,531.7
Other intangible assets, net 1,714.7 1,460.7
Other noncurrent assets 317.1 267.7
Total assets $ 17,104.8 $ 14,545.7
Liabilities
Current maturities of long-term debt 400.5 0.5
Trade payables and accruals 407.0 390.4
Accrued salaries, wages and management incentives 124.0 135.8
Accrued interest 31.4 32.8
Other current liabilities 276.2 238.1
Total current liabilities 1,239.1 797.6
Long-term debt 4,906.9 3,877.3
Deferred income taxes, net 1,336.5 1,028.9
Pension and other postretirement benefits 75.2 83.6
Asset retirement obligations 427.4 324.1
Deferred revenue 137.8 145.3
Noncurrent operating lease liabilities 521.4 507.4
Other noncurrent liabilities 318.0 273.6
Total liabilities $ 8,962.3 $ 7,037.8
Other commitments and contingencies (Note 12)
Equity
Common stock, $1 par value, Authorized 480.0 shares,
Outstanding 132.1 and 132.1 shares, respectively
132.1 132.1
Capital in excess of par value 2,900.1 2,880.1
Retained earnings 5,213.8 4,615.0
Accumulated other comprehensive loss (127.4) (143.8)
Total shareholders' equity 8,118.6 7,483.4
Noncontrolling interest 23.9 24.5
Total equity 8,142.5 7,507.9
Total liabilities and equity $ 17,104.8 $ 14,545.7
The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
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VULCAN MATERIALS COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Years Ended December 31
in millions 2024 2023 2022
Operating Activities
Net earnings $ 913.1 $ 934.9 $ 576.5
Adjustments to reconcile net earnings to net cash provided by operating activities
Depreciation, depletion, accretion and amortization 632.2 617.0 587.5
Loss on impairments 86.6 28.3 67.9
Noncash operating lease expense 51.4 53.9 60.3
Net gain on sale of property, plant & equipment and businesses (52.3) (76.4) (10.7)
Contributions to pension plans (8.7) (7.4) (7.8)
Share-based compensation expense 53.4 63.2 41.1
Deferred income taxes, net (9.4) (43.3) 57.7
(Increase) decrease in assets excluding the initial effects of business acquisitions and dispositions
Accounts and notes receivable 63.2 28.2 (53.3)
Inventories (27.4) (54.6) (49.5)
Other assets (93.0) 27.8 (92.3)
Increase (decrease) in liabilities excluding the initial effects of business acquisitions and dispositions
Accrued interest and income taxes (6.8) 18.8 0.4
Trade payables and other accruals (193.0) (25.1) (17.4)
Other noncurrent liabilities (20.4) (42.4) (36.4)
Other, net 20.7 13.9 24.2
Net cash provided by operating activities $ 1,409.6 $ 1,536.8 $ 1,148.2
Investing Activities
Purchases of property, plant & equipment (603.5) (872.6) (612.6)
Proceeds from sale of property, plant & equipment 54.7 94.6 38.7
Proceeds from sale of businesses 0.2 613.6 50.0
Payment for businesses acquired, net of acquired cash and adjustments (2,266.2) 0.9 (529.2)
Other, net (0.1) 0.0 0.1
Net cash used for investing activities $ (2,814.9) $ (163.5) $ (1,053.0)
Financing Activities
Proceeds from short-term debt 8.0 166.1 1,361.0
Payment of short-term debt (8.0) (266.1) (1,261.0)
Payment of current maturities and long-term debt (550.5) (550.5) (557.7)
Proceeds from issuance of long-term debt 2,000.0 550.0 550.0
Debt issuance and exchange costs (31.6) (3.4) (2.8)
Payment of finance leases (13.0) (30.8) (33.8)
Purchases of common stock (68.8) (200.0) 0.0
Dividends paid (244.4) (228.4) (212.6)
Share-based compensation, shares withheld for taxes (33.0) (21.9) (18.5)
Distribution to noncontrolling interest (1.8) (0.8) 0.0
Other, net 0.0 0.2 0.2
Net cash provided by (used for) financing activities $ 1,056.9 $ (585.6) $ (175.2)
Net increase (decrease) in cash and cash equivalents and restricted cash (348.4) 787.7 (80.0)
Cash and cash equivalents and restricted cash at beginning of year 949.2 161.5 241.5
Cash and cash equivalents and restricted cash at end of year $ 600.8 $ 949.2 $ 161.5
The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
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VULCAN MATERIALS COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF EQUITY
Common Stock Capital in
Excess of
Par Value Retained
Earnings Accumulated
Other
Comprehensive
Income (Loss) Total
Shareholders'
Equity Non-
controlling
Interest Total
in millions Shares Amount
Balances at December 31, 2021 132.7 $ 132.7 $ 2,816.5 $ 3,748.5 $ (152.7) $ 6,545.0 $ 22.7 $ 6,567.7
Net earnings 0.0 0.0 0.0 575.6 0.0 575.6 0.9 576.5
Share-based compensation plans, net of shares withheld for taxes 0.2 0.2 (18.7) 0.0 0.0 (18.5) 0.0 (18.5)
Share-based compensation expense 0.0 0.0 41.1 0.0 0.0 41.1 0.0 41.1
Cash dividends on common stock 0.0 0.0 0.0 (212.6) 0.0 (212.6) 0.0 (212.6)
Other comprehensive income (loss) 0.0 0.0 0.0 0.0 (2.0) (2.0) 0.0 (2.0)
Other 0.0 0.0 0.1 (0.1) 0.0 0.0 0.0 0.0
Balances at December 31, 2022 132.9 $ 132.9 $ 2,839.0 $ 4,111.4 $ (154.7) $ 6,928.6 $ 23.6 $ 6,952.2
Net earnings 0.0 0.0 0.0 933.2 0.0 933.2 1.7 934.9
Share-based compensation plans, net of shares withheld for taxes 0.2 0.2 (22.0) 0.0 0.0 (21.8) 0.0 (21.8)
Purchase and retirement of common stock (1.0) (1.0) 0.0 (201.5) 0.0 (202.5) 0.0 (202.5)
Share-based compensation expense 0.0 0.0 63.2 0.0 0.0 63.2 0.0 63.2
Cash dividends on common stock 0.0 0.0 0.0 (228.4) 0.0 (228.4) 0.0 (228.4)
Other comprehensive income (loss) 0.0 0.0 0.0 0.0 10.9 10.9 0.0 10.9
Distribution to noncontrolling interest 0.0 0.0 0.0 0.0 0.0 0.0 (0.8) (0.8)
Other 0.0 0.0 (0.1) 0.3 0.0 0.2 0.0 0.2
Balances at December 31, 2023 132.1 $ 132.1 $ 2,880.1 $ 4,615.0 $ (143.8) $ 7,483.4 $ 24.5 $ 7,507.9
Net earnings 0.0 0.0 0.0 911.9 0.0 911.9 1.2 913.1
Share-based compensation plans, net of shares withheld for taxes 0.3 0.3 (33.5) 0.0 0.0 (33.2) 0.0 (33.2)
Purchase and retirement of common stock (0.3) (0.3) 0.0 (68.8) 0.0 (69.1) 0.0 (69.1)
Share-based compensation expense 0.0 0.0 53.4 0.0 0.0 53.4 0.0 53.4
Cash dividends on common stock 0.0 0.0 0.0 (244.4) 0.0 (244.4) 0.0 (244.4)
Other comprehensive income (loss) 0.0 0.0 0.0 0.0 16.4 16.4 0.0 16.4
Distribution to noncontrolling interest 0.0 0.0 0.0 0.0 0.0 0.0 (1.8) (1.8)
Other 0.0 0.0 0.1 0.1 0.0 0.2 0.0 0.2
Balances at December 31, 2024 132.1 $ 132.1 $ 2,900.1 $ 5,213.8 $ (127.4) $ 8,118.6 $ 23.9 $ 8,142.5
The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
NATURE OF OPERATIONS
Vulcan Materials Company (the “Company,” “Vulcan,” “we,” “our”), a New Jersey corporation, is the nation's largest supplier of construction aggregates (primarily crushed stone, sand and gravel) and a major producer of aggregates-intensive downstream products such as asphalt mix and ready-mixed concrete.
We operate primarily in the United States, and our principal product - aggregates - is used in most types of public and private construction projects and in the production of asphalt mix and ready-mixed concrete. We serve aggregates markets in twenty-three states, the U.S. Virgin Islands, Washington D.C., and the local markets surrounding our operations in Freeport, Bahamas; British Columbia, Canada; Puerto Cortés, Honduras; and Quintana Roo, Mexico (see Note 12, NAFTA Arbitration). Our primary focus is serving metropolitan markets in the United States that are expected to experience the most significant growth in population, households and employment. These three demographic factors are significant drivers of demand for aggregates. While aggregates is our focus and primary business, we produce and sell aggregates-intensive asphalt mix and/or ready-mixed concrete products in our Alabama, Arizona, California, Maryland, New Mexico, Tennessee, Texas, Virginia, U.S. Virgin Islands and Washington D.C. markets.
Due to the 2005 sale of our Chemicals business as described below, the results of the Chemicals business are presented as discontinued operations in the accompanying Consolidated Statements of Comprehensive Income.
DISCONTINUED OPERATIONS
In 2005, we sold substantially all the assets of our Chemicals business to Basic Chemicals, a subsidiary of Occidental Chemical Corporation. The financial results of the Chemicals business are classified as discontinued operations in the accompanying Consolidated Statements of Comprehensive Income for all periods presented. Results from discontinued operations are as follows:
in millions 2024 2023 2022
Pretax loss $ (10.2) $ (14.7) $ (25.2)
Income tax benefit 2.6 3.9 6.6
Loss on discontinued operations, net of tax $ (7.6) $ (10.8) $ (18.6)
Our discontinued operations include charges related to general and product liability costs, including legal defense costs, and environmental remediation costs associated with our former Chemicals business (including certain matters as discussed in Note 12). In addition, 2022 includes a $15.3 million charge for a litigation matter. There were no revenues from discontinued operations for the years presented.
PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the accounts of Vulcan Materials Company and all our majority or wholly-owned subsidiary companies. Partially-owned affiliates are either consolidated or accounted for at cost or as equity investments depending on the level of ownership interest or our ability to exercise control over the affiliates’ operations. All intercompany transactions and accounts have been eliminated in consolidation.
NONCONTROLLING INTEREST
We own an 88% controlling interest in the Orca Sand and Gravel Limited Partnership (Orca) which was formed to develop the Orca quarry in British Columbia, Canada. The remaining 12% noncontrolling interest is held by the Namgis First Nation (Namgis). This noncontrolling interest consists of the Namgis’ share of the fair value equity in the partnership. Our consolidated financial statements recognize the full fair value of all of the subsidiary’s assets and liabilities offset by the noncontrolling interest in total equity.
USE OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS
The preparation of these financial statements in conformity with accounting principles generally accepted (GAAP) in the United States of America requires us to make estimates and judgments that affect reported amounts of assets, liabilities, revenues and expenses, and the related disclosures of contingent assets and contingent liabilities at the date of the financial statements. We evaluate these estimates and judgments on an ongoing basis and base our estimates on historical experience, current conditions and various other assumptions that are believed to be reasonable under the circumstances. The results of these estimates form the basis for our judgments about the carrying values of assets and liabilities as well as identifying and assessing the accounting treatment with respect to commitments and contingencies. Actual results may differ materially from these estimates. The most significant estimates included in the preparation of these financial statements are related to goodwill and long-lived asset impairments, business combinations and purchase price allocation, pension and other postretirement benefits, environmental compliance, claims and litigation including self-insurance, and income taxes. Events that relate to conditions arising after December 31, 2024 will be reflected in management’s estimates for future periods.
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BUSINESS COMBINATIONS
We account for business combinations under the acquisition method of accounting. The purchase price of an acquisition is allocated to the underlying identifiable assets acquired and liabilities assumed based on their respective fair values. The purchase price is determined based on the fair value of consideration transferred to and liabilities assumed from the seller as of the date of acquisition. We allocate the purchase price to the fair values of the tangible and identifiable intangible assets acquired and liabilities assumed as of the date of acquisition. Goodwill is recorded for the excess of the purchase price over the net fair value of the identifiable assets acquired and liabilities assumed.
Determining the fair values of assets acquired and liabilities assumed requires judgment and often involves the use of significant estimates and assumptions. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction and, therefore, represents an exit price. A fair value measurement assumes the highest and best use of the asset by market participants.
We may adjust the amounts recognized in an acquisition during a measurement period after the acquisition date. Any such adjustments are the result of subsequently obtaining additional information that existed at the acquisition date regarding the assets acquired or the liabilities assumed. Measurement period adjustments are generally recorded as increases or decreases to goodwill, if any, recognized in the transaction. The cumulative impact of measurement period adjustments on depreciation, amortization and other income statement items are recognized in the period the adjustment is determined.
For additional information about business combinations, see Note 19.
FOREIGN CURRENCY TRANSACTIONS
The U.S. dollar is the functional currency for all of our operations, as the primary economic environment in which we transact business is the United States. For our non-U.S. subsidiaries, local currency inventories and long-term assets such as property, plant & equipment and intangibles are remeasured into U.S. dollars at approximate rates prevailing when acquired; all other assets and liabilities are remeasured at year-end exchange rates. Inventories charged to cost of sales and depreciation are remeasured at historical rates; all other income and expense items are remeasured at average exchange rates prevailing during the year. Gains and losses which result from remeasurement are included in other nonoperating income/expense in the accompanying Consolidated Statements of Comprehensive Income and are not material for the years presented.
CASH EQUIVALENTS
We classify as cash equivalents all highly liquid securities with a maturity of three months or less at the time of purchase. The carrying amount of these securities approximates fair value due to their short-term maturities.
RESTRICTED CASH
Restricted cash primarily consists of cash proceeds from the sale of property held in escrow for the acquisition of replacement property under like-kind exchange agreements. The escrow accounts are administered by an intermediary. Cash restricted pursuant to like-kind exchange agreements remains restricted for a maximum of 180 days from the date of the property sale pending the acquisition of replacement property. Restricted cash may also include cash reserved by other contractual agreements (such as asset purchase agreements) for a specified purpose and therefore is not available for use for other purposes. Restricted cash is included with cash and cash equivalents in the accompanying Consolidated Statements of Cash Flows.
ACCOUNTS AND NOTES RECEIVABLE
Accounts and notes receivable from customers result from our extending credit to trade customers for the purchase of our products. The terms generally provide for payment within 15 days of the month following invoice. On occasion, when necessary to conform to regional industry practices, we sell product under extended payment terms, which may result in either secured or unsecured short-term notes; or, on occasion, notes with durations of less than one year are taken in settlement of existing accounts receivable. Other accounts and notes receivable result from short-term transactions (less than one year) other than the sale of our products, such as interest receivable, insurance claims, freight claims, bid deposits or rents receivable.
Allowance for credit losses is based on our assessment of the collectability of customer accounts. We regularly review the allowance by considering factors such as historical experience, credit quality, the age of the accounts receivable balances, and current economic conditions that may affect a customer’s ability to pay. Allowances for credit losses were $13.2 million and $13.6 million at December 31, 2024 and 2023, respectively. Bad debt expense (included in selling, administrative and general expense) for the years ended December 31, 2024, 2023 and 2022 was $3.7 million, $2.1 million and $0.7 million, respectively.
INVENTORIES
Inventories and supplies are stated at the lower of cost or net realizable value. We use the last-in, first-out (LIFO) method of valuation for most of our inventories because it results in a better matching of costs with revenues. Such costs include fuel, parts and supplies, raw materials, direct labor and production overhead. An actual valuation of inventory under the LIFO method can be made only at the end of each year based on the inventory levels and costs at that time. Accordingly, interim LIFO calculations are based on our estimates of expected year-end inventory levels and costs and are subject to the final year-end LIFO inventory valuation. Substantially all operating supplies inventory is carried at average cost.
For additional information about inventories, see Note 3.
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PROPERTY, PLANT & EQUIPMENT
Property, plant & equipment are carried at cost less accumulated depreciation, depletion and amortization.
For assets sold or otherwise disposed of, the cost and related accumulated depreciation are removed, and any related gain or loss is reflected in income.
Capitalized software costs reflected in property, plant & equipment are immaterial for all years presented.
For additional information about our property, plant & equipment, see Note 4.
PREPAID SOFTWARE AS A SERVICE
Prepaid software as a service (SaaS) implementation costs of $17.7 million are reflected in other noncurrent assets as of December 31, 2024 (there were no related prepaid implementation costs prior to 2024). We recorded prepaid SaaS costs of $19.4 million for the year ended December 31, 2024 which are recognized as service expense on a straight-line basis over 7 years. Service expense related to prepaid SaaS implementation costs was $1.7 million for the year ended December 31, 2024.
REPAIR AND MAINTENANCE
Repair and maintenance costs generally are charged to operating expense as incurred. Renewals and betterments that add materially to the utility or useful lives of property, plant & equipment are capitalized and subsequently depreciated. Actual costs for planned major maintenance activities, related primarily to periodic overhauls on our aircrafts and oceangoing vessels, are capitalized and amortized to the next overhaul.
LEASES
Our nonmineral leases with initial terms in excess of one year are recognized on the balance sheet as right-of-use (ROU) assets and lease liabilities. Mineral leases are exempt from balance sheet recognition.
ROU assets represent our right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments arising from the leases. ROU assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. The lease term only includes options to extend or terminate the lease when it is reasonably certain that we will exercise that option. As our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. ROU assets are adjusted for any prepaid lease payments and lease incentives. Except for equipment with monthly monitoring service where the service component accounts for a majority of the lease cost, the non-lease components of our lease agreements are not separated from the lease components.
For additional information about leases, see Note 7.
DEPRECIATION, DEPLETION, ACCRETION AND AMORTIZATION
Depreciation is generally computed by the straight-line method at rates based on the estimated service lives of the various classes of assets, which include machinery and equipment (3 to 35 years), buildings (7 to 20 years) and land improvements (3 to 20 years). Finance leases are amortized over varying periods not in excess of applicable lease terms or estimated useful lives. Capitalized costs for software under our control (by ownership or license) are included in machinery and equipment and are depreciated on a straight-line basis beginning when the software project is substantially complete.
Cost depletion on depletable land is computed by the unit-of-sales method based on estimated recoverable units.
Accretion reflects the period-to-period increase in the carrying amount of the liability for asset retirement obligations. It is computed using the same credit-adjusted, risk-free rate used to initially measure the liability at fair value.
Leaseholds are amortized over varying periods not in excess of applicable lease terms or estimated useful lives.
Amortization of intangible assets subject to amortization is computed based on the estimated life of the intangible assets. A significant portion of our intangible assets is contractual rights in place associated with zoning, permitting and other rights to access and extract aggregates reserves. Contractual rights in place associated with aggregates reserves are amortized using the unit-of-sales method based on estimated recoverable units. Other intangible assets are amortized principally by the straight-line method.
Depreciation, depletion, accretion and amortization expense for the years ended December 31 is outlined below:
in millions 2024 2023 2022
Depreciation $ 464.6 $ 441.1 $ 409.1
Depletion 59.5 61.1 50.2
Accretion 14.7 13.9 14.1
Depreciation of finance leases 9.5 12.8 16.5
Amortization of intangibles 83.9 88.1 97.6
Total depreciation, depletion, accretion and amortization $ 632.2 $ 617.0 $ 587.5
Part II 70
DERIVATIVE INSTRUMENTS
During the normal course of operations, we are exposed to market risks including interest rates, foreign currency exchange rates and commodity prices. From time to time, and consistent with our risk management policies, we use derivative instruments to balance the cost and risk of such expenses. We do not use derivative instruments for trading or other speculative purposes.
The accounting for gains and losses that result from changes in the fair value of derivative instruments depends on whether the derivatives have been designated and qualify as hedging instruments and the type of hedging relationship. Changes in the fair value of interest rate swap fair value hedges are recorded as interest expense consistent with the change in the fair value of the hedged item attributable to the risk being hedged. Changes in the fair value of interest rate swap cash flow hedges are recorded in accumulated other comprehensive income (AOCI) and are reclassified into interest expense in the same period the hedged items affect earnings. We may also enter into contracts that qualify for the normal purchases and normal sales (NPNS) exception. When a contract meets the criteria to qualify as NPNS, we apply such exception. Income recognition and realization related to NPNS contracts generally coincide with the physical delivery of the commodity. For contracts qualifying for the NPNS exception, no recognition of the contract’s fair value in the consolidated financial statements is required until settlement of the contract as long as the transaction remains probable of occurring.
For additional information about derivative instruments, see Note 5.
FAIR VALUE MEASUREMENTS
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels as described below:
Level 1: Quoted prices in active markets for identical assets or liabilities
Level 2: Inputs that are derived principally from or corroborated by observable market data
Level 3: Inputs that are unobservable and significant to the overall fair value measurement
Our assets at December 31 subject to fair value measurement on a recurring basis are summarized below:
in millions 2024 2023
Level 1 Fair Value
Rabbi Trust
Mutual funds $ 31.1 $ 31.7
Total $ 31.1 $ 31.7
Level 2 Fair Value
Interest rate swaps $ 0.0 $ (0.3)
Rabbi Trust
Money market mutual fund 0.3 0.5
Total $ 0.3 $ 0.2
We have two Rabbi Trusts for the purpose of providing a level of security for the employee nonqualified retirement and deferred compensation plans and for the directors' nonqualified deferred compensation plans. The fair values of these investments are estimated using a market approach. The Level 1 investments include mutual funds for which quoted prices in active markets are available. Level 2 investments are stated at estimated fair value based on the underlying investments in the fund (high-quality, short-term, U.S. dollar-denominated money market instruments).
Net gains (losses) of the Rabbi Trusts’ investments were $(0.4) million, $3.0 million and $(4.8) million for the years ended December 31, 2024, 2023 and 2022, respectively. The portions of the net gains (losses) related to investments still held by the Rabbi Trusts at December 31, 2024, 2023 and 2022 were $(0.6) million, $3.1 million and $(5.2) million, respectively.
Interest rate swaps are measured at fair value using quoted market prices or pricing models that use prevailing market interest rates as of the measurement date. These interest rate swaps are more fully described in Note 5.
The carrying values of our cash equivalents, restricted cash, accounts and notes receivable, short-term debt, trade payables and accruals, and all other current liabilities approximate their fair values because of the short-term nature of these instruments. Additional disclosures for derivative instruments and interest-bearing debt are presented in Note 5 and Note 6, respectively.
During the third quarter of 2023, net assets held for sale (our concrete operations in Texas) with a carrying value of $513.3 million were written down to their estimated fair value (less cost to sell) of $485.0 million, resulting in an impairment loss of $28.3 million; these net assets were subsequently sold during the fourth quarter of 2023 resulting in additional loss on sale of $13.8 million. The estimated fair value (Level 1 fair value measurement) was determined based on the expected proceeds from the probable sale of the disposal group. See below for a related goodwill impairment charge in 2022 and Note 19 for additional discussion of the disposal of the net assets.
Part II 71
GOODWILL IMPAIRMENT
Goodwill represents the excess of the cost of net assets acquired in business combinations over the fair value of the identifiable tangible and intangible assets acquired and liabilities assumed in a business combination. Goodwill impairment exists when the fair value of a reporting unit is less than its carrying amount. As of December 31, 2024, goodwill totaled $3,788.1 million as compared to $3,531.7 million at December 31, 2023. Goodwill represents 22% of total assets at December 31, 2024 and 24% at December 31, 2023.
Goodwill is tested for impairment annually, as of November 1, or more frequently whenever events or changes in circumstances would more likely than not reduce the fair value of a reporting unit below its carrying amount. Goodwill is tested for impairment at the reporting unit level, one level below our operating segments. We have three operating segments organized around our principal product lines: Aggregates, Asphalt and Concrete. Within these three operating segments, we have identified 14 reporting units (of which 10 carry goodwill) based primarily on geographic location. We have the option of either assessing qualitative factors to determine whether it is more likely than not that the carrying value of our reporting units exceeds their respective fair value or proceeding directly to a quantitative test. We elected to perform the quantitative impairment test for all years presented.
The quantitative impairment test compares the fair value of a reporting unit to its carrying value, including goodwill. If the fair value exceeds its carrying value, the goodwill of the reporting unit is not considered impaired. However, if the carrying value of a reporting unit exceeds its fair value, we recognize an impairment loss equal to that excess.
During the third quarter of 2024, we determined that a triggering event occurred with respect to a reporting unit that includes concrete operations acquired from U.S. Concrete in 2021. Based on an interim goodwill impairment test, we determined that the estimated fair value of this reporting unit was less than its carrying value. As a result, we recorded a $86.6 million interim goodwill impairment loss. In addition, during the third quarter of 2022, we recorded an interim goodwill impairment loss of $50.9 million related to the fourth quarter sale of a reporting unit comprised of concrete operations in New Jersey, New York and Pennsylvania (see Note 19 for additional information). There were no charges for goodwill impairment in the year ended December 31, 2023.
We estimate the fair values of the reporting units using both an income approach (which involves discounting estimated future cash flows) and a market approach (which involves the application of revenue and EBITDA multiples of comparable companies). Determining the fair value of our reporting units involves the use of significant estimates and assumptions and considerable management judgment. We base our fair value estimates on assumptions we believe to be reasonable at the time, but such assumptions are subject to inherent uncertainty and actual results may differ. Changes in key assumptions or management judgment with respect to a reporting unit or its prospects, which may result from a change in market conditions, market trends, interest rates or other factors outside of our control, or underperformance relative to historical or projected operating results, could result in a significantly different estimate of the fair value of our reporting units, which could result in an impairment charge in the future.
For additional information about goodwill, see Note 18.
IMPAIRMENT OF LONG-LIVED ASSETS EXCLUDING GOODWILL
We evaluate the carrying value of long-lived assets, including intangible assets subject to amortization, when events and circumstances indicate that the carrying value may not be recoverable. The carrying value of long-lived assets is considered impaired when the estimated undiscounted cash flows from such assets are less than their carrying value. In that event, we perform a fair value analysis and recognize a loss equal to the amount by which the carrying value exceeds the fair value. Fair value is determined primarily by using a discounted cash flow methodology that requires considerable judgment and assumptions. Our estimate of net future cash flows is based on historical experience and assumptions of future trends, which may be different from actual results. We periodically review the appropriateness of the estimated useful lives of our long-lived assets.
We test long-lived assets for impairment at a significantly lower level than the level at which we test goodwill for impairment. In markets where we do not produce downstream products (e.g., asphalt mix and ready-mixed concrete), the lowest level of largely independent identifiable cash flows is at the individual aggregates operation or a group of aggregates operations collectively serving a local market or remote markets through our rail and water distribution networks. Conversely, in vertically integrated markets, the cash flows of our downstream and upstream businesses are not largely independently identifiable as the selling price of the upstream products (aggregates) determines the profitability of the downstream business.
As of December 31, 2024, net property, plant & equipment represents 49% of total assets while net other intangible assets represents 10% of total assets. As previously noted, during the third quarter of 2023, we recorded a $28.3 million loss on impairment of long-lived assets related to the fourth quarter sale of concrete operations in Texas. In addition, during the third quarter of 2022, we recorded a $16.9 million loss on impairment of long-lived assets related to the fourth quarter sale of concrete operations in New Jersey, New York and Pennsylvania. See Note 19 for divestiture information and Note 18 for a related goodwill impairment charge in 2022. During 2024, we recorded no significant losses on impairment of long-lived assets.
For additional information about long-lived assets and intangible assets, see Note 4 and Note 18, respectively.
Part II 72
REVENUES AND REVENUE RECOGNITION
Total revenues include sales of product and services to customers, net of any discounts and taxes, and freight and delivery revenues billed to customers. Freight and delivery generally represent pass-through transportation we incur (including our administrative costs) and pay to third-party carriers to deliver our products to customers. The cost related to freight and delivery is included in cost of revenues.
Revenues are measured as the amount of consideration we expect to receive in exchange for transferring goods or providing services. Sales tax and other taxes we collect are recorded as liabilities until remitted and thus are excluded from revenues. Costs to obtain and fulfill contracts (primarily asphalt construction paving contracts) are immaterial and are expensed as incurred when the expected amortization period is one year or less.
Revenues for product sales are recognized when control passes to the customer (typically occurs when finished products are shipped/delivered). Construction paving revenues are recognized using the percentage-of-completion method.
Our products typically are sold to private industry and not directly to governmental entities. Although approximately 40% to 55% of our aggregates shipments have historically been used in publicly-funded construction (such as highways, airports and government buildings), relatively insignificant sales are made directly to federal, state, county or municipal governments/agencies. Therefore, although reductions in state and federal funding can curtail publicly-funded construction, the vast majority of our aggregates business is not directly subject to renegotiation of profits or termination of contracts with state or federal governments.
For additional information regarding revenues and revenue recognition, see Note 2.
STRIPPING COSTS
In the mining industry, the costs of removing overburden and waste materials to access mineral deposits are referred to as stripping costs.
Stripping costs incurred during the production phase are considered costs of extracted minerals under our inventory costing system, inventoried, and recognized in cost of sales in the same period as the revenue from the sale of the inventory. The production stage is deemed to begin when the activities, including removal of overburden and waste material that may contain incidental saleable material, required to access the saleable product are complete. Stripping costs considered as production costs and included in the costs of inventory produced were $132.1 million, $135.8 million and $133.1 million in 2024, 2023 and 2022, respectively.
Conversely, stripping costs incurred during the development stage of a mine (pre-production stripping) are excluded from our inventory cost. Pre-production stripping costs are capitalized and reported within other noncurrent assets in our accompanying Consolidated Balance Sheets. Capitalized pre-production stripping costs are expensed over the productive life of the mine using the unit-of-sales method. Pre-production stripping costs included in other noncurrent assets were $104.8 million and $98.4 million (net of accumulated amortization of $9.8 million and $7.7 million) as of December 31, 2024 and 2023, respectively.
RECLAMATION COSTS
Reclamation costs resulting from normal use of long-lived assets are recognized over the period the asset is in use when there is a legal obligation to incur these costs upon retirement of the assets. Additionally, reclamation costs resulting from normal use under a mineral lease are recognized over the lease term when there is a legal obligation to incur these costs upon expiration of the lease. The obligation, which cannot be reduced by estimated offsetting cash flows, is recorded at fair value as a liability at the obligating event date and is accreted through charges to operating expenses. This fair value is also capitalized as part of the carrying amount of the underlying asset and depreciated over the estimated useful life of the asset. If the obligation is settled for other than the carrying amount of the liability, a gain or loss is recognized on settlement.
To determine the fair value of the obligation, we estimate the cost (including a reasonable profit margin) for a third party to perform the legally required reclamation tasks. This cost is then increased for both future estimated inflation and an estimated market risk premium related to the estimated years to settlement. Once calculated, this cost is discounted to fair value using present value techniques with a credit-adjusted, risk-free rate commensurate with the estimated years to settlement.
In estimating the settlement date, we evaluate the current facts and conditions to determine the most likely settlement date. If this evaluation identifies alternative estimated settlement dates, we use a weighted-average settlement date considering the probabilities of each alternative.
We review reclamation obligations at least annually for a revision to the cost or a change in the estimated settlement date. Additionally, reclamation obligations are reviewed in the period that a triggering event occurs that would result in either a revision to the cost or a change in the estimated settlement date. Examples of events that would trigger a change in the cost include a new reclamation law or amendment of an existing mineral lease. Examples of events that would trigger a change in the estimated settlement date include the acquisition of additional reserves or the closure of a facility.
The carrying value of these obligations was $427.4 million and $324.1 million as of December 31, 2024 and 2023, respectively. For additional information about reclamation obligations (referred to in our financial statements as asset retirement obligations), see Note 17.
Part II 73
ENVIRONMENTAL COMPLIANCE
Our environmental compliance costs are undiscounted and include the cost of ongoing monitoring programs, the cost of remediation efforts and other similar costs. We accrue costs for environmental assessment and remediation efforts when we determine that a liability is probable and we can reasonably estimate the cost. At the early stages of a remediation effort, environmental remediation liabilities are not easily quantified due to the uncertainties of various factors. The range of an estimated remediation liability is defined and redefined as events in the remediation effort occur, but generally liabilities are recognized no later than the completion of the remedial feasibility study.
When we can estimate a range of probable loss, we accrue the most likely amount. If no amount in the range of probable loss is considered most likely, the minimum loss in the range is accrued. As of December 31, 2024, the spread between the amount accrued and the maximum loss in the range for all sites for which a range can be reasonably estimated was $4.1 million; this amount does not represent our maximum exposure to loss for all environmental remediation obligations as it excludes those sites for which a range of loss cannot be reasonably estimated at this time. Accrual amounts may be based on technical cost estimations or the professional judgment of experienced environmental managers. Our Safety, Health and Environmental Affairs Management Committee routinely reviews cost estimates and key assumptions in response to new information, such as the kinds and quantities of hazardous substances, available technologies and changes to the parties participating in the remediation efforts. However, a number of factors, including adverse agency rulings and encountering unanticipated conditions as remediation efforts progress, may cause actual results to differ materially from accrued costs.
For additional information about environmental compliance costs, see Note 8.
CLAIMS AND LITIGATION INCLUDING SELF-INSURANCE
We are involved with claims and litigation, including items covered under our self-insurance program. We are self-insured for losses related to workers' compensation up to $3.0 million per occurrence and automotive and general/product liability up to $10.0 million per occurrence. We have excess coverage on a per occurrence basis beyond these retention levels. Under our self-insurance program, we aggregate certain claims and litigation costs that are reasonably predictable based on our historical loss experience and accrue losses, including future legal defense costs, based on actuarial studies. Certain claims and litigation costs, due to their unique nature, are not included in our actuarial studies. We use both internal and outside legal counsel to assess the probability of loss and establish an accrual when the claims and litigation represent a probable loss and the cost can be reasonably estimated. For matters not included in our actuarial studies, legal defense costs are accrued when incurred. The following table outlines our self-insurance program at December 31:
dollars in millions 2024 2023
Self-insurance Program
Self-insured liabilities (undiscounted) $ 138.2 $ 151.7
Insured liabilities (undiscounted) 2.3 2.3
Discount rate 4.22 % 4.56 %
Amounts Recognized in Consolidated Balance Sheets
Investments and long-term receivables 2.3 2.3
Other current liabilities (47.3) (59.6)
Other noncurrent liabilities (74.6) (76.1)
Net insurance liabilities (discounted) $ (119.6) $ (133.4)
Estimated payments (undiscounted and excluding the impact of related receivables) under our self-insurance program for the five years subsequent to December 31, 2024 are as follows:
in millions
Estimated Payments under Self-insurance Program
2025 $ 40.1
2026 29.0
2027 17.6
2028 10.0
2029 5.4
Significant judgment is used in determining the timing and amount of the accruals for probable losses, and the actual liability could differ materially from the accrued amounts.
For additional information about claims and litigation, see Note 12 under the caption "Litigation and Environmental Matters."
Part II 74
SHARE-BASED COMPENSATION
All of our share-based compensation awards are classified as equity awards. We measure share-based compensation awards using fair-value-based measurement methods. This results in the recognition of compensation expense for all share-based compensation awards based on their fair value as of the grant date with adjustments for performance, as applicable. Compensation cost is recognized over the requisite service period. Forfeitures are recognized as they occur.
A summary of the estimated future compensation cost (unrecognized compensation expense) as of December 31, 2024 related to share-based awards granted to employees under our long-term incentive plans is presented below:
dollars in millions Unrecognized
Compensation
Expense Expected
Weighted-Average
Recognition (Years)
SOSARs 1
$ 1.7 1.4
Performance shares 18.6 1.7
Restricted shares 13.4 1.7
Total/weighted-average $ 33.7 1.7
1Stock-Only Stock Appreciation Rights (SOSARs)
Pretax compensation expense related to our employee share-based compensation awards and related income tax benefits for the years ended December 31 are summarized below:
in millions 2024 2023 2022
Pretax compensation expense $ 50.6 $ 60.6 $ 38.7
Income tax benefits 7.7 9.1 6.9
We receive an income tax deduction for share-based compensation equal to the excess of the market value of our common stock on the date of exercise or issuance over the exercise price. Excess tax benefits resulting from tax deductions, after considering any deductibility limitations such as IRC section 162(m), in excess of the compensation cost recognized are reflected as discrete income tax benefits in the period of exercise or issuance.
For additional information about share-based compensation, see Note 11 under the caption "Share-based Compensation Plans".
PENSION AND OTHER POSTRETIREMENT BENEFITS
Accounting for pension and other postretirement benefits requires that we use assumptions for the valuation of projected benefit obligations (PBO) and the performance of plan assets. Each year, we review our assumptions (listed below) for discount rates (used for PBO, service cost, and interest cost calculations), expected return on plan assets and the cost of covered healthcare benefits. Due to plan changes made in 2013, annual pay increases do not materially impact plan obligations.
▪Discount Rates - We use a high-quality bond full yield curve approach (specific spot rates for each annual expected cash flow) to establish the discount rates at each measurement date.
▪Expected Return on Plan Assets - Our expected return on plan assets is a long-term view based on our current asset allocation and a judgment informed by consultation with our retirement plans’ consultant and our pension plans’ actuary.
▪Rate of Increase in the Per Capita Cost of Covered Healthcare Benefits - We project the expected increases in the cost of covered healthcare benefits.
Accounting standards provide for the delayed recognition of differences between actual results and expected or estimated results. This delayed recognition of actual results allows for a smoothed recognition in earnings of changes in benefit obligations and asset performance. The differences between actual results and expected or estimated results are recognized in full in other comprehensive income. Amounts recognized in other comprehensive income are reclassified to earnings in a systematic manner over the average remaining service period of participants for our active plans or the average remaining lifetime of participants for our inactive plans.
We present the service cost component of net periodic benefit cost in cost of revenues and selling, administrative and general expense consistent with employee compensation costs. The other components of net periodic benefit cost are reported within other nonoperating income in our accompanying Consolidated Statements of Comprehensive Income.
For additional information about pension and other postretirement benefits, see Note 10.
Part II 75
INCOME TAXES
We file federal, state and foreign income tax returns and account for the current and deferred tax effects of such returns using the asset and liability method. We recognize deferred tax assets and liabilities (which reflect our best assessment of the future taxes we will pay) based on the differences between the book basis and tax basis of assets and liabilities. Deferred tax assets represent items to be used as a tax deduction or credit in future tax returns while deferred tax liabilities represent items that will result in additional tax in future tax returns.
Significant judgments and estimates are required in determining our deferred tax assets and liabilities. These estimates are updated throughout the year to consider income tax return filings, our geographic mix of earnings, legislative changes and other relevant items. We are required to account for the effects of changes in income tax rates on deferred tax balances in the period in which the legislation is enacted.
Each quarter we analyze the likelihood that our deferred tax assets will be realized. Realization of the deferred tax assets ultimately depends on the existence of sufficient taxable income of the appropriate character in either the carryback or carryforward period. A valuation allowance is recorded if, based on the weight of all available positive and negative evidence, it is more likely than not (a likelihood of more than 50%) that some portion, or all, of a deferred tax asset will not be realized. A summary of our deferred tax assets is included in Note 9.
We recognize a tax benefit associated with a tax position when, in our judgment, it is more likely than not that the position will be sustained based upon the technical merits of the position. For a tax position that meets the more likely than not recognition threshold, we measure the income tax benefit as the largest amount that we judge to have a greater than 50% likelihood of being realized. A liability is established for the unrecognized portion of any tax position. Our liability for unrecognized tax benefits is adjusted periodically due to changing circumstances, such as the progress of tax audits, case law developments and new legislation.
Generally, we are not subject to significant changes in income taxes by any taxing jurisdiction for the years before 2021. While it is often difficult to predict the final outcome or the timing of resolution of any particular tax matter, we believe our liability for unrecognized tax benefits is appropriate.
We consider a tax position to be resolved at the earlier of the issue being “effectively settled,” settlement of an examination, or the expiration of the statute of limitations. Upon resolution of a tax position, any liability for unrecognized tax benefits will be released.
Our liability for unrecognized tax benefits is generally presented as noncurrent. However, if we anticipate paying cash within one year to settle an uncertain tax position, the liability is presented as current. We classify interest and penalties associated with our liability for unrecognized tax benefits as income tax expense.
Our largest permanent item in computing both our taxable income and effective tax rate is the deduction allowed for statutory depletion. The impact of statutory depletion on the effective tax rate is presented in Note 9. The deduction for statutory depletion does not necessarily change proportionately to changes in pretax earnings.
COMPREHENSIVE INCOME
We report comprehensive income in our Consolidated Statements of Comprehensive Income and Consolidated Statements of Equity. Comprehensive income comprises two subsets: net earnings and other comprehensive income (OCI). OCI includes adjustments to cash flow hedges, as well as actuarial gains or losses and prior service costs related to pension and postretirement benefit plans.
For additional information about comprehensive income, see Note 14.
EARNINGS PER SHARE (EPS)
Earnings per share are computed by dividing net earnings by the weighted-average common shares outstanding (basic EPS) or weighted-average common shares outstanding assuming dilution (diluted EPS), as set forth below:
in millions 2024 2023 2022
Weighted-average common shares outstanding 132.3 133.0 133.0
Dilutive effect of
SOSARs 0.2 0.2 0.2
Other stock compensation awards 0.6 0.5 0.4
Weighted-average common shares outstanding, assuming dilution 133.1 133.7 133.6
All dilutive common stock equivalents are reflected in our earnings per share calculations. In periods of loss, shares that otherwise would have been included in our diluted weighted-average common shares outstanding computation would be excluded.
Antidilutive common stock equivalents are not included in our earnings per share calculations. The number of antidilutive common stock equivalents for which the exercise price exceeds the weighted-average market price for the years ended December 31 is as follows:
in millions 2024 2023 2022
Antidilutive common stock equivalents 0.0 0.0 0.1
Part II 76
RECLASSIFICATIONS
As a result of a first quarter 2024 change in our internal management reporting structure, prior period segment information has been revised to conform to our current segment reporting structure. This change had no impact on our prior consolidated results of operations, financial position or cash flows (refer to Note 15 for further information).
NEW ACCOUNTING STANDARDS
ACCOUNTING STANDARDS RECENTLY ADOPTED
During the fourth quarter of 2024, we adopted Accounting Standards Update (ASU) 2023-07, “Segment Reporting - Improvements to Reportable Segment Disclosures,” which resulted in enhanced disclosures related to significant segment expenses and a description of how the chief operating decision maker utilizes segment operating profit or loss to assess segment performance (see Note 15).
ACCOUNTING STANDARDS PENDING ADOPTION
In December 2023, the Financial Accounting Standards Board (FASB) issued ASU 2023-09, “Income Taxes - Improvements to Income Tax Disclosures,” which requires disclosure of specific categories and disaggregation of information in the rate reconciliation table and expands disclosures related to income taxes paid. The new standard is effective for fiscal years beginning after December 15, 2024 and is to be applied prospectively. We are assessing the effect of this ASU on our disclosures that will be included in our Form 10-K for the year ending December 31, 2025.
In November 2024, the FASB issued ASU 2024-03, "Disaggregation of Income Statement Expenses," which requires disaggregated disclosure of prescribed expense categories within relevant income statement captions. The new standard is effective for fiscal years beginning after December 15, 2026 and is to be applied prospectively. We are assessing the effect of this ASU on our consolidated financial statements and related disclosures.
Part II 77
NOTE 2: REVENUES
Total revenues are primarily derived from our product sales of aggregates (crushed stone, sand and gravel, sand and other aggregates), asphalt mix and ready-mixed concrete, and include freight & delivery costs that we pass along to our customers to deliver these products. We also generate service revenues from our asphalt construction paving business and service revenues related to our aggregates business, such as landfill tipping fees. Our total service revenues were as follows: 2024 - $275.7 million (3.7% of total revenues), 2023 - $239.6 million (3.1% of total revenues) and 2022 - $233.1 million (3.2% of total revenues).
Our segment total revenues by geographic market for the years ended December 31, 2024, 2023 and 2022 are disaggregated as follows:
For the Year Ended December 31, 2024
in millions Aggregates Asphalt Concrete Total
East revenues $ 1,758.6 $ 200.0 $ 338.3 $ 2,296.9
Gulf Coast revenues 3,242.9 277.4 8.8 3,529.1
West revenues 948.1 768.2 306.4 2,022.7
Segment sales $ 5,949.6 $ 1,245.6 $ 653.5 $ 7,848.7
Intersegment sales (431.0) 0.0 0.0 (431.0)
Total revenues 1
$ 5,518.6 $ 1,245.6 $ 653.5 $ 7,417.7
For the Year Ended December 31, 2023
in millions Aggregates Asphalt Concrete Total
East revenues $ 1,665.2 $ 201.4 $ 363.0 $ 2,229.6
Gulf Coast revenues 3,333.8 231.6 539.8 4,105.2
West revenues 919.9 707.7 346.5 1,974.1
Segment sales $ 5,918.9 $ 1,140.7 $ 1,249.3 $ 8,308.9
Intersegment sales (527.0) 0.0 0.0 (527.0)
Total revenues 1
$ 5,391.9 $ 1,140.7 $ 1,249.3 $ 7,781.9
For the Year Ended December 31, 2022
in millions Aggregates Asphalt Concrete Total
East revenues $ 1,508.2 $ 177.3 $ 694.2 $ 2,379.7
Gulf Coast revenues 2,940.8 211.2 551.9 3,703.9
West revenues 831.6 601.7 347.8 1,781.1
Segment sales $ 5,280.6 $ 990.2 $ 1,593.9 $ 7,864.7
Intersegment sales (549.5) 0.0 0.0 (549.5)
Total revenues 1
$ 4,731.1 $ 990.2 $ 1,593.9 $ 7,315.2
1The geographic markets are defined by states/countries as follows:
East market - Arkansas, Delaware, Illinois, Kentucky, Maryland, New Jersey, New York, North Carolina, Pennsylvania, Tennessee, Virginia, and Washington D.C.
Gulf Coast market - Alabama, Florida, Georgia, Louisiana, Mississippi, Oklahoma, South Carolina, Texas, U.S. Virgin Islands, Freeport (Bahamas), Puerto Cortés (Honduras) and Quintana Roo (Mexico)
West market - Arizona, California, Hawaii, New Mexico and British Columbia (Canada)
PRODUCT REVENUES
Revenue is recognized when obligations under the terms of a contract with our customer are satisfied; generally, this occurs at a point in time when our aggregates, asphalt mix and ready-mixed concrete are shipped/delivered and control passes to the customer. Revenue for our products is recorded at the fixed invoice amount, and payment is due by the 15th day of the following month; we do not offer discounts for early payment.
Freight & delivery generally represents pass-through transportation costs we incur (including our administrative costs) and pay to third-party carriers to deliver our products to customers and are accounted for as a fulfillment activity. Likewise, the costs related to freight & delivery are included in cost of revenues.
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Freight & delivery revenues are as follows:
in millions 2024 2023 2022
Total revenues $ 7,417.7 $ 7,781.9 $ 7,315.2
Freight & delivery revenues 1
(988.2) (1,003.4) (960.3)
Total revenues excluding freight & delivery $ 6,429.5 $ 6,778.5 $ 6,354.9
1Includes freight & delivery to remote distribution sites.
CONSTRUCTION PAVING SERVICE REVENUES
Revenue from our asphalt construction paving business is recognized over time using the percentage-of-completion method under the cost approach. The percentage of completion is determined by costs incurred to date as a percentage of total costs estimated for the project. Under this approach, recognized contract revenue equals the total estimated contract revenue multiplied by the percentage of completion. Future revenues from unsatisfied performance obligations (including contracts with an expected duration of 1 year or less) at December 31, 2024, 2023 and 2022 were $159.0 million, $137.0 million and $112.3 million, respectively. The remaining period to complete the obligations remaining at December 31, 2024 ranged from 1 month to 48 months.
Our construction contracts are unit priced, and an account receivable is recorded for amounts invoiced based on actual units produced. Contract assets for estimated earnings in excess of billings, contract assets related to retainage provisions and contract liabilities for billings in excess of costs are immaterial. Variable consideration in our construction paving contracts is immaterial and consists of incentives and penalties based on the quality of work performed. Our construction paving contracts may contain warranty provisions covering defects in equipment, materials, design or workmanship that generally run from nine months to one year after project completion. Due to the nature of our construction paving projects, including contract owner inspections of the work during construction and prior to acceptance, we have not experienced material warranty costs for these short-term warranties.
VOLUMETRIC PRODUCTION PAYMENT DEFERRED REVENUES
In 2013 and 2012, we sold a percentage interest in certain future aggregates production for net cash proceeds of $226.9 million. These transactions, structured as volumetric production payments (VPPs):
▪relate to eight quarries in Georgia and South Carolina
▪provide the purchaser solely with a nonoperating percentage interest in the subject quarries’ future aggregates production
▪contain no minimum annual or cumulative guarantees by us for production or sales volume, nor minimum sales price
▪are both volume and time limited
We are the exclusive sales agent for, and transmit quarterly to the purchaser the proceeds from the sale of, the purchaser’s share of aggregates production. Our consolidated total revenues exclude the revenue from the sale of the purchaser’s share of aggregates.
The proceeds we received from the sale of the percentage interest were recorded as deferred revenue on the balance sheet. We recognize revenue on a unit-of-sales basis (as we sell the purchaser’s share of production) relative to the volume limitations of the transactions. Given the nature of the risks and potential rewards assumed by the buyer, the transactions do not reflect financing activities.
Changes in the VPP deferred revenue balances (current and noncurrent) are as follows:
in millions 2024 2023 2022
Deferred revenue balance at beginning of year $ 152.8 $ 161.8 $ 170.1
Revenue recognized from deferred revenue (7.5) (9.0) (8.3)
Deferred revenue balance at end of year $ 145.3 $ 152.8 $ 161.8
Based on expected sales from the specified quarries, we expect to recognize $7.5 million of VPP deferred revenue as income in 2025 (reflected in other current liabilities in our December 31, 2024 Consolidated Balance Sheet).
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NOTE 3: INVENTORIES
Inventories at December 31 are as follows:
in millions 2024 2023
Finished products 1
$ 534.6 $ 494.4
Raw materials 69.7 51.2
Products in process 9.0 6.5
Operating supplies and other 68.5 63.5
Total inventories $ 681.8 $ 615.6
1Includes inventories encumbered by volumetric production payments (see Note 2) of $3.9 million and $3.6 million as of December 31, 2024 and 2023, respectively.
In addition to the inventory balances presented above, as of December 31, 2024 and 2023, we had $22.8 million and $12.5 million, respectively, of inventory classified as long-term assets (other noncurrent assets) as we do not expect to sell the inventory within one year of their respective balance sheet dates.
We use the LIFO method of valuation for most of our inventories as it results in a better matching of costs with revenues. Inventories valued under the LIFO method total $389.8 million and $356.9 million at December 31, 2024 and 2023, respectively. During 2024, 2023 and 2022, inventory reductions resulted in liquidations of LIFO inventory layers carried at costs prevailing in prior years as compared to current-year costs. The effect of the LIFO liquidation on our results was as follows:
▪2024 - decrease cost of revenues by $5.1 million and increase net earnings by $3.8 million
▪2023 - decrease cost of revenues by $3.6 million and increase net earnings by $2.7 million
▪2022 - decrease cost of revenues by $4.8 million and increase net earnings by $3.5 million
Estimated current cost exceeded LIFO cost at December 31, 2024 and 2023 by $370.6 million and $302.6 million, respectively. In periods of increasing costs, LIFO generally results in higher cost of revenues than under FIFO. In periods of decreasing costs, the results are generally the opposite. We provide supplemental income disclosures to facilitate comparisons with companies not on LIFO. The supplemental income calculation is derived by tax-affecting the change in the LIFO reserve for the periods presented. If all inventories valued at LIFO cost had been valued under first-in, first-out (FIFO) method, the approximate effect on net earnings would have been an increase of $47.2 million in 2024, an increase of $27.9 million in 2023 and an increase of $48.1 million in 2022.
NOTE 4: PROPERTY, PLANT & EQUIPMENT
Balances of major classes of assets and allowances for depreciation, depletion and amortization at December 31 are as follows:
in millions 2024 2023
Land and land improvements 1
$ 5,804.8 $ 4,292.6
Buildings 304.4 204.4
Machinery and equipment 7,717.2 6,785.5
Finance leases (see Note 7) 54.7 62.3
Deferred asset retirement costs 235.6 171.3
Construction in progress 400.1 319.4
Total, gross property, plant & equipment $ 14,516.8 $ 11,835.5
Allowances for depreciation, depletion and amortization (6,055.3) (5,617.8)
Total, net property, plant & equipment $ 8,461.5 $ 6,217.7
1Includes depletable land of $4,015.7 million and $2,684.4 million as of December 31, 2024 and 2023, respectively.
Capitalized interest costs with respect to qualifying construction projects and total interest costs incurred before recognition of the capitalized amount for the years ended December 31 are as follows:
in millions 2024 2023 2022
Capitalized interest cost $ 4.0 $ 3.7 $ 3.6
Total interest cost incurred before recognition of the capitalized amount 195.2 199.8 172.8
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NOTE 5: DERIVATIVE INSTRUMENTS
During the normal course of operations, we are exposed to market risks including interest rates, foreign currency exchange rates and commodity prices. From time to time, we use derivative instruments to balance the cost and risk of such expenses. We do not use derivative instruments for trading or other speculative purposes.
In March 2023, we issued $550.0 million of 5.80% fixed-rate debt maturing in March 2026. Concurrently, we entered into fixed-to-floating interest rate swap agreements designated as fair value hedges in the amount of $550.0 million. These swap agreements terminated in March 2024, coinciding with the redemption of the debt.
The changes in the fair value of these swaps designated as fair value hedges were recorded in interest expense and were perfectly offset by changes in the fair value of the related debt also recorded in interest expense. These swaps were recognized at fair value in the accompanying Consolidated Balance Sheets at December 31 as follows:
in millions Balance Sheet Location 2024 2023
Fair Value Hedges 1
Interest rate swaps Other noncurrent assets $ 0.0 $ 3.9
Interest rate swaps Other current liabilities 0.0 (4.2)
Interest rate swaps net liability $ 0.0 $ (0.3)
1See Note 1 under the caption “Fair Value Measurements” for further discussion of fair value determination.
In 2007, 2018 and 2020, we entered into interest rate locks of future debt issuances to hedge the risk of higher interest rates. These interest rate locks were designated as cash flow hedges. The gain/loss upon settlement of these cash flow hedges is deferred (recorded in accumulated other comprehensive income (AOCI)) and amortized to interest expense over the term of the related debt.
This amortization was reflected in the accompanying Consolidated Statements of Comprehensive Income for the years ended December 31 as follows:
in millions Income Statement Location 2024 2023 2022
Cash Flow Hedges
Loss reclassified from AOCI Interest expense $ (2.2) $ (2.1) $ (2.0)
For the twelve-month period ending December 31, 2025, we estimate that $2.4 million of the $17.7 million net of tax loss in AOCI will be reclassified to interest expense.
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NOTE 6: DEBT
Debt at December 31 is detailed as follows:
in millions Effective
Interest Rates 2024 2023
Bank line of credit expires 2029 1
$ 0.0 $ 0.0
Commercial paper expires 20291
0.0 0.0
Total short-term debt $ 0.0 $ 0.0
Bank line of credit expires 2029 1
$ 0.0 $ 0.0
Commercial paper expires 2029 1
550.0 550.0
4.50% notes due 2025
4.65% 400.0 400.0
5.80% notes due 2026
0.0 550.0
3.90% notes due 2027
4.00% 400.0 400.0
4.95% notes due 2029
5.17% 500.0 0.0
3.50% notes due 2030
3.94% 750.0 750.0
5.35% notes due 2034
5.48% 750.0 0.0
7.15% notes due 2037
8.05% 129.2 129.2
4.50% notes due 2047
4.59% 700.0 700.0
4.70% notes due 2048
5.42% 460.9 460.9
5.70% notes due 2054
5.82% 750.0 0.0
Other notes 1.0 1.4
Total long-term debt - face value $ 5,391.1 $ 3,941.5
Unamortized discounts and debt issuance costs (83.7) (63.4)
Fair value adjustments 2
0.0 (0.3)
Total long-term debt - book value $ 5,307.4 $ 3,877.8
Current maturities (400.5) (0.5)
Total long-term debt - reported value $ 4,906.9 $ 3,877.3
Estimated fair value of long-term debt $ 4,762.6 $ 3,798.0
1Borrowings on the bank line of credit and commercial paper are classified as short-term if we intend to repay within twelve months and as long-term if we have the intent and ability to extend payment beyond twelve months.
2See Note 5 for additional information on our fair value hedging strategy.
Discounts and debt issuance costs are amortized using the effective interest method over the terms of the respective notes resulting in $11.4 million and $6.2 million of net interest expense for these items for 2024 and 2023, respectively.
LINE OF CREDIT AND COMMERCIAL PAPER PROGRAM
Our $1,600.0 million commercial paper program was established in August 2022 and matures in November 2029. Commercial paper borrowings bear interest at rates determined at the time of borrowing and as agreed between us and the commercial paper investors. As of December 31, 2024, we had $550.0 million in long-term commercial paper borrowings.
Our $1,600.0 million unsecured line of credit was amended in November 2024 to extend the maturity date from August 2027 to November 2029. Our line of credit contains covenants customary for an unsecured investment-grade facility. As of December 31, 2024, we were in compliance with the line of credit covenants. Borrowings on the line of credit bear interest, at our option, at either SOFR plus a margin or Truist Bank’s base rate plus a margin. The margins are determined by our credit ratings. Standby letters of credit, which are issued under the line of credit and reduce availability, are charged a fee equal to the margin for SOFR borrowings plus 0.175%. We also pay a commitment fee on the daily average unused amount of the line of credit that ranges from 0.090% to 0.225% determined by our credit ratings. As of December 31, 2024, the margin for SOFR borrowings was 1.125%, the margin for base rate borrowings was 0.125% and the commitment fee for the unused amount was 0.100%.
As of December 31, 2024, our available borrowing capacity under the line of credit was $1,504.8 million. Utilization of the borrowing capacity was as follows:
▪None was borrowed
▪$95.2 million was used to support standby letters of credit
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TERM DEBT
All of our $5,391.1 million (face value) of term debt (which includes $550.0 million of commercial paper) is unsecured. All of the covenants in the debt agreements are customary for investment-grade facilities. As of December 31, 2024, we were in compliance with all term debt covenants.
In March 2023, we issued $550.0 million of 5.80% senior notes due 2026. We redeemed these notes at par in March 2024 using cash on hand and recognized noncash expense of $2.3 million with the acceleration of unamortized deferred debt issuance costs.
In November 2024, we entered into a $2,000.0 million unsecured delayed draw term loan which was partially drawn in November 2024 upon the acquisition of Wake Stone Corporation (Wake Stone). Subsequently, the delayed draw term loan balance was fully repaid and terminated in November 2024 using proceeds from the issuance of senior notes as described below.
In November 2024, we issued $500.0 million of 4.95% senior notes due 2029, $750.0 million of 5.35% senior notes due 2034 and $750.0 million of 5.70% senior notes due 2054. Total proceeds of $1,975.0 million (net of discounts and transaction costs), together with cash on hand, were used to repay the outstanding balance on the $2,000.0 million delayed draw term loan and to provide liquidity for acquisitions and debt maturing in 2025.
The total scheduled (principal and interest) debt payments, excluding the line of credit, for the five years subsequent to December 31, 2024 are as follows:
in millions Total Principal Interest
Scheduled Debt Payments (excluding the line of credit)
2025 $ 649.2 $ 400.5 $ 248.7
2026 233.5 0.4 233.1
2027 624.9 400.0 224.9
2028 217.1 0.0 217.1
2029 1,265.3 1,050.0 215.3
STANDBY LETTERS OF CREDIT
We provide, in the normal course of business, certain third-party beneficiaries with standby letters of credit to support our obligations to pay or perform according to the requirements of an underlying agreement. Such letters of credit typically have an initial term of one year, renew automatically and can only be modified or canceled with the approval of the beneficiary. Except for $9.6 million of letters of credit related to acquisitions completed in 2024, our standby letters of credit are issued by banks that participate in our $1,600.0 million line of credit and reduce the borrowing capacity thereunder. Our standby letters of credit as of December 31, 2024 are summarized by purpose in the table below:
in millions
Risk management insurance $ 81.4
Reclamation/restoration requirements 23.4
Total standby letters of credit $ 104.8
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NOTE 7: LEASES
Our portfolio of nonmineral leases is composed of leases for real estate (including office buildings, aggregates sales yards and terminals, and concrete and asphalt sites) and equipment (including railcars and rail track, barges, and office, plant and mobile equipment).
Lease right-of-use (ROU) assets and liabilities reflected on our December 31 balance sheets and the weighted-average lease terms and discount rates are as follows:
dollars in millions Classification on the Balance Sheet 2024 2023
Assets
Operating lease ROU assets $ 673.2 $ 636.1
Accumulated amortization (146.8) (124.4)
Operating leases, net Operating lease right-of-use assets, net 526.4 511.7
Finance lease ROU assets 54.7 62.3
Accumulated depreciation (24.3) (20.2)
Finance leases, net Property, plant & equipment, net 30.4 42.1
Total lease assets $ 556.8 $ 553.8
Liabilities
Current
Operating Other current liabilities $ 49.3 $ 47.3
Finance Other current liabilities 10.7 12.5
Noncurrent
Operating Noncurrent operating lease liabilities 521.4 507.4
Finance Other noncurrent liabilities 9.7 16.6
Total lease liabilities $ 591.1 $ 583.8
Lease Term and Discount Rate
Weighted-average remaining lease term (years)
Operating leases 18.9 19.5
Finance leases 2.2 2.5
Weighted-average discount rate
Operating leases 4.5 % 4.3 %
Finance leases 3.2 % 2.4 %
Our lease agreements do not contain material residual value guarantees, restrictive covenants or early termination options. In addition to the lease assets and liabilities presented in the table above, we entered into an agreement to lease a terminal in California and expect to have all permits in place associated with all lease commencement options by the second quarter of 2025.
Our building leases have remaining noncancelable periods of 0 - 14 years and lease terms (including options to extend) of 1 - 22 years. Key factors in determining the certainty of lease renewals include the location of the building, the value of leasehold improvements and the cost to relocate. Rental payments for certain of our building leases are periodically adjusted for inflation, and this variable component is recognized as expense when incurred. Many of our building leases contain common area maintenance charges which we include in the calculation of our lease liability (the lease consideration is not allocated between the lease and non-lease components).
Our aggregates sales yard leases have remaining noncancelable periods of 0 - 24 years and lease terms of 1 - 74 years. The key factor in determining the certainty of lease renewals is the financial impact of extending the lease, including the reserve life of the sourcing aggregates quarry. Certain aggregates sales yard lease agreements include rental payments based on a percentage of sales over contractual levels or the number of shipments received into the sales yard. Variable payments for these sales yards comprise a majority of the overall variable lease cost presented in the table below.
Our concrete and asphalt site leases have remaining noncancelable periods of 0 - 15 years and lease terms of 0 - 74 years. The key factor in determining the certainty of lease renewals is the financial impact of extending the lease, including the reserve life of the sourcing aggregates quarry. Rental payments are generally fixed for our concrete and asphalt sites.
Our rail (car and track) leases have remaining noncancelable periods of 0 - 15 years and lease terms of 0 - 60 years. Key factors in determining the certainty of lease renewals include the market rental rate for comparable assets and, in some cases, the cost incurred to restore the asset. Rental payments are fixed for our rail leases. The majority of our rail leases contain substitution rights that allow the supplier to replace damaged equipment. Because these rights are generally limited to either replacing railcars or moving our placement on rail track for purposes of repair or maintenance, we do not consider these substitution rights to be substantive and have recorded a lease liability and ROU asset for all leased rail.
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Our barge leases have remaining noncancelable periods of 3 - 4 years and lease terms of 10 - 18 years. Key factors in determining the certainty of lease renewals include the market rental rate for comparable assets and, in some cases, the cost incurred to restore the asset. Rental payments are fixed. Like our rail leases, our barge leases contain non-substantive substitution rights that are limited to replacing barges in need of repair or maintenance.
Office, plant and mobile equipment leases have remaining noncancelable periods of 0 - 5 years and lease terms of 0 - 5 years. The key factor in determining the certainty of lease renewals is the market rental rate for comparable assets. Rental payments are generally fixed for our equipment leases with terms greater than 1 year. The significant majority of our short-term lease cost presented in the table below is derived from office and plant equipment leases with terms of 1 year or less.
The components of lease expense for the years ended December 31, 2024, 2023 and 2022 are as follows:
in millions 2024 2023 2022
Finance lease cost
Depreciation of right-of-use assets $ 9.5 $ 12.8 $ 16.5
Interest on lease liabilities 0.7 0.9 1.2
Operating lease cost 75.6 77.5 85.6
Short-term lease cost 1
46.9 50.4 46.4
Variable lease cost 20.6 23.5 14.4
Sublease income (2.8) (3.4) (2.9)
Total lease expense $ 150.5 $ 161.7 $ 161.2
1Includes the cost of leases with an initial term of one year or less (including those with terms of one month or less).
Cash paid for operating leases was $73.8 million and $73.0 million for 2024 and 2023, respectively. Cash paid for finance leases (principal and interest) was $13.7 million and $31.6 million for 2024 and 2023, respectively.
Maturity analysis on an undiscounted basis of our lease liabilities (see Note 12 for mineral lease payments) as of December 31, 2024 is as follows:
in millions Operating
Leases Finance
Leases
2025 $ 73.8 $ 11.2
2026 66.7 6.7
2027 62.2 2.1
2028 55.2 0.8
2029 50.8 0.4
Thereafter 608.7 0.0
Total minimum lease payments $ 917.4 $ 21.2
Lease payments representing interest (346.7) (0.8)
Present value of future minimum lease payments $ 570.7 $ 20.4
Current obligations under leases (49.3) (10.7)
Long-term lease obligations $ 521.4 $ 9.7
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NOTE 8: ACCRUED ENVIRONMENTAL REMEDIATION COSTS
Our Consolidated Balance Sheets as of December 31 include accrued environmental remediation costs (measured on an undiscounted basis) as follows:
in millions 2024 2023
Continuing operations $ 47.9 $ 32.6
Retained from former Chemicals business 8.3 8.3
Total accrued environmental remediation costs $ 56.2 $ 40.9
The long-term portion of the accruals noted above is included in other noncurrent liabilities in the accompanying Consolidated Balance Sheets and amounted to $42.5 million and $28.0 million at December 31, 2024 and 2023, respectively. The $14.5 million increase relates to environmental matters associated with divested operations. The short-term portion of these accruals is included in other current liabilities in the accompanying Consolidated Balance Sheets.
The accrued environmental remediation costs in continuing operations relate primarily to the former U.S. Concrete, Florida Rock, Tarmac and CalMat facilities acquired in 2021, 2007, 2000 and 1999, respectively. The balances noted above for the former Chemicals business relate to retained environmental remediation costs from the 2003 sale of the Performance Chemicals business and the 2005 sale of the Chloralkali business. Refer to Note 12 for additional discussion of contingent environmental matters.
NOTE 9: INCOME TAXES
The components of earnings from continuing operations before income taxes are as follows:
in millions 2024 2023 2022
Earnings from Continuing Operations before Income Taxes
Domestic $ 1,196.1 $ 1,251.0 $ 788.7
Foreign (24.0) (5.9) (0.6)
Total $ 1,172.1 $ 1,245.1 $ 788.1
Income tax expense (benefit) from continuing operations consists of the following:
in millions 2024 2023 2022
Income Tax Expense (Benefit) from Continuing Operations
Current
Federal $ 204.7 $ 274.8 $ 85.2
State and local 51.8 64.0 43.6
Foreign 4.8 4.8 4.6
Total $ 261.3 $ 343.6 $ 133.4
Deferred
Federal $ 13.6 $ (44.1) $ 43.4
State and local (20.5) (4.2) 3.3
Foreign (3.0) 4.1 12.9
Total $ (9.9) $ (44.2) $ 59.6
Total expense $ 251.4 $ 299.4 $ 193.0
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Income tax expense (benefit) differs from the amount computed by applying the federal statutory income tax rate to earnings from continuing operations before income taxes. The sources and tax effects of the differences are as follows:
dollars in millions 2024 2023 2022
Income tax expense at the federal statutory tax rate $ 246.1 21.0 % $ 261.5 21.0 % $ 165.5 21.0 %
Expense (Benefit) from Income Tax Differences
Statutory depletion (41.0) (3.5 %) (39.0) (3.1 %) (30.6) (3.9 %)
State and local income taxes, net of federal income tax benefit 51.4 4.4 % 48.7 3.9 % 37.5 4.8 %
Nondeductible goodwill 16.2 1.4 % 16.2 1.3 % 10.7 1.4 %
Valuation allowance 0.1 0.0 % 10.3 0.8 % 14.5 1.8 %
Deferred tax rate remeasurement
(21.9) (1.9 %) 0.0 0.0 % 0.0 0.0 %
Other, net 0.5 0.0 % 1.7 0.1 % (4.6) (0.6 %)
Total income tax expense / Effective tax rate $ 251.4 21.4 % $ 299.4 24.0 % $ 193.0 24.5 %
During the fourth quarter of 2024, we determined that the rate at which our deferred tax liabilities will reverse has decreased, largely as a result of changes in our state tax profile from the Wake Stone acquisition. As a result, we remeasured our deferred tax liabilities and recorded a tax benefit of $21.9 million.
Deferred taxes on the balance sheet result from temporary differences between the amount of assets and liabilities recognized for financial reporting and tax purposes. The components of the net deferred income tax liability at December 31 are as follows:
in millions 2024 2023
Deferred Tax Assets
Operating lease liabilities $ 140.8 $ 139.1
Asset retirement obligations & other reserves 86.6 87.1
State net operating losses 74.7 79.6
Incentive compensation 52.4 57.6
State bonus depreciation 55.7 54.7
Capitalized research expenditures
39.7 25.4
Employee benefits 22.2 22.9
Other 81.8 56.9
Total gross deferred tax assets $ 553.9 $ 523.3
Valuation allowance (87.7) (89.5)
Total net deferred tax asset $ 466.2 $ 433.8
Deferred Tax Liabilities
Property, plant & equipment $ 1,244.8 $ 907.1
Goodwill/other intangible assets 323.2 334.4
Operating lease right-of-use assets 129.8 128.2
Other 104.9 93.0
Total deferred tax liabilities $ 1,802.7 $ 1,462.7
Deferred income tax liability, net $ 1,336.5 $ 1,028.9
The December 31, 2024 net deferred tax liability reflects a $307.6 million increase from the prior year. This increase includes a net deferred tax liability of $311.2 million related to our acquisition of Wake Stone, reflecting book over tax basis differences, of which $328.9 million relates to property, plant and equipment.
At December 31, 2024, we have Alabama state NOL carryforward deferred tax assets of $68.5 million, against which we have a valuation allowance of $50.8 million. $4.9 million of the Alabama NOL carryforward expired in 2024, resulting in additional tax expense of $1.3 million over the previous amount of valuation allowance recorded. Almost all of the remaining Alabama NOL carryforward would expire between 2025 and 2029 if not utilized.
As discussed in Note 12, in May 2022, Mexican government officials unexpectedly and arbitrarily shut down our Calica operations in Mexico. In 2024, Calica had deferred tax assets (including NOLs) of $27.5 million. Although Calica continues to record losses, the devaluation of the Mexican peso during the year resulted in an immaterial change to its deferred tax assets in U.S. dollars. As a result, we recorded a charge to increase the valuation allowance by $0.1 million to $27.5 million in 2024. The Calica NOL deferred tax asset carryforward of $23.3 million would expire between 2032 and 2033 if not utilized. Should the Mexican government lift the shutdown and/or if we are successful in our NAFTA claim, we will reevaluate the need for a valuation allowance against the deferred tax assets.
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In August 2022, the Inflation Reduction Act (IRA) was signed into law, effective for tax years beginning on or after January 1, 2023. The IRA introduced a corporate alternative minimum tax (CAMT) of 15% applicable to corporations with adjusted financial statement income in excess of $1 billion, as well as certain climate-related tax provisions. We were not subject to CAMT in 2023 or in 2024.
The Organization for Economic Co-operation and Development (OECD) has developed a framework to enact a two-pillar solution to address the challenges arising from the digitization of a global economy. Pillar Two introduced a global minimum effective tax rate where multinational groups with consolidated revenue over €750.0 million are subject to a minimum effective tax rate of 15% on income arising in low-tax jurisdictions. Pillar Two legislation has been enacted in certain jurisdictions in which we operate and it was effective on January 1, 2024. Most jurisdictions in which we operate have tax rates in excess of 15%. However, our operations in the Bahamas are not eligible for transitional safe harbor relief, and we have reflected an immaterial amount of Pillar Two tax in our effective tax rate for 2024.
We consider the undistributed earnings, if any, related to the investment in our Canadian and Honduran subsidiaries and Canadian investment in its U.S. subsidiary to be indefinitely reinvested; accordingly, no foreign withholding or other income taxes have been provided thereon. Due to complexities in the tax laws, it is not practicable to estimate the amount of deferred income taxes not recorded that are associated with these earnings. We have not, nor do we currently anticipate in the foreseeable future, the need to repatriate funds (other than for the repayment of intercompany loan obligations) to satisfy domestic liquidity needs arising in the ordinary course of business.
Changes in our liability for unrecognized tax benefits for the years ended December 31 are as follows:
in millions 2024 2023 2022
Unrecognized tax benefits as of January 1 $ 21.0 $ 18.7 $ 10.8
Increases for tax positions related to
Prior years 0.8 0.3 4.6
Current year 6.7 4.8 6.6
Decreases for tax positions related to
Prior years 0.0 (0.3) (0.2)
Settlements
(0.3) (0.2) 0.0
Expiration of applicable statute of limitations (3.3) (2.3) (3.1)
Unrecognized tax benefits as of December 31 $ 24.9 $ 21.0 $ 18.7
We classify interest and penalties recognized on the liability for unrecognized tax benefits as income tax expense. Interest and penalties recognized as income tax expense were $1.5 million, $1.5 million and $0.8 million in 2024, 2023 and 2022, respectively. The balance of accrued interest and penalties included in our liability for unrecognized tax benefits as of December 31 was $4.8 million, $3.3 million and $1.8 million in 2024, 2023 and 2022, respectively. Our liability for unrecognized tax benefits at December 31 in the table above includes $23.7 million, $19.8 million and $17.6 million in 2024, 2023 and 2022, respectively, that would affect the effective tax rate if recognized. We anticipate no single tax position generating a significant increase or decrease in our liability for unrecognized tax benefits within 12 months of this reporting date.
We file income tax returns in U.S. federal, various state and foreign jurisdictions. With few exceptions, we are no longer subject to U.S. federal, state or foreign exams by tax authorities for years prior to 2021.
As of December 31, 2024, income tax receivables of $4.7 million and $0.1 million are included in other accounts and notes receivable and other current assets, respectively, in the accompanying Consolidated Balance Sheet. There were similar receivables of $1.3 million and $0.2 million recorded in other accounts and notes receivable and other current assets, respectively, as of December 31, 2023.
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NOTE 10: BENEFIT PLANS
PENSION PLANS
We sponsor two qualified, noncontributory defined benefit pension plans, the Vulcan Materials Company Pension Plan (VMC Pension Plan) and the CMG Hourly Pension Plan (CMG Pension Plan). The VMC Pension Plan has been closed to new entrants since 2007, and benefit accruals ceased in 2005 for hourly participants and 2013 for salaried participants. The CMG Pension Plan is closed to new entrants other than through one small union, and benefits continue to accrue equal to a flat dollar amount for each year of service. In addition to these qualified plans, we sponsor three unfunded, nonqualified pension plans. The projected benefit obligation (PBO) presented in the table below includes $32.5 million and $39.7 million related to these unfunded, nonqualified pension plans for 2024 and 2023, respectively.
The following table sets forth the combined funded status of the plans and their reconciliation with the related amounts recognized in our consolidated financial statements at December 31:
in millions 2024 2023
Change in Benefit Obligation
Projected benefit obligation at beginning of year $ 693.3 $ 691.1
Service cost 2.3 2.5
Interest cost 32.9 34.0
Actuarial (gain) loss (40.2) 12.4
Benefits paid (47.5) (46.7)
Projected benefit obligation at end of year $ 640.8 $ 693.3
Change in Fair Value of Plan Assets
Fair value of assets at beginning of year $ 647.9 $ 637.8
Actual return on plan assets (2.0) 49.4
Employer contribution 8.7 7.4
Benefits paid (47.5) (46.7)
Fair value of assets at end of year $ 607.1 $ 647.9
Funded status (33.7) (45.4)
Net amount recognized $ (33.7) $ (45.4)
Amounts Recognized in the Consolidated Balance Sheets
Noncurrent assets $ 8.1 $ 6.5
Current liabilities (4.1) (7.3)
Noncurrent liabilities (37.7) (44.6)
Net amount recognized $ (33.7) $ (45.4)
Amounts Recognized in Accumulated Other Comprehensive Income
Net actuarial loss $ 153.1 $ 168.4
Prior service cost 0.0 1.0
Total amount recognized $ 153.1 $ 169.4
The decrease in actuarial loss as of December 31, 2024 was primarily attributable to the increase in discount rates compared with the prior year.
The following table sets forth the pension plans for which their accumulated benefit obligation (ABO) or projected benefit obligation (PBO) exceeds the fair value of their respective plan assets at December 31:
in millions 2024 2023
Pension plans with ABO in excess of plan assets
Accumulated benefit obligation $ 177.5 $ 182.7
Fair value of assets 135.8 140.3
Pension plans with PBO in excess of plan assets
Projected benefit obligation $ 177.7 $ 192.2
Fair value of assets 135.8 140.3
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The following table sets forth the components of net periodic benefit cost, amounts recognized in other comprehensive income and weighted-average assumptions of the plans at December 31:
dollars in millions 2024 2023 2022
Components of Net Periodic Pension Benefit Cost
Service cost $ 2.3 $ 2.5 $ 4.0
Interest cost 32.9 34.0 21.1
Expected return on plan assets (28.1) (27.6) (30.1)
Amortization of prior service cost 1.0 1.4 1.4
Amortization of actuarial loss 5.1 5.6 4.2
Net periodic pension benefit cost $ 13.2 $ 15.9 $ 0.6
Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income
Net actuarial loss (gain) $ (10.2) $ (9.4) $ 11.2
Reclassification of prior service cost (1.0) (1.4) (1.4)
Reclassification of actuarial loss (5.1) (5.6) (4.2)
Amount recognized in other comprehensive income $ (16.3) $ (16.4) $ 5.6
Amount recognized in net periodic pension benefit cost and other comprehensive income $ (3.1) $ (0.5) $ 6.2
Assumptions
Weighted-average assumptions used to determine net periodic benefit cost for years ended December 31
Discount rate - PBO 5.00 % 5.19 % 2.92 %
Discount rate - service cost
5.10 % 5.29 % 3.17 %
Discount rate - interest cost 4.90 % 5.09 % 2.37 %
Expected return on plan assets
4.85 % 4.85 % 4.00 %
Weighted-average assumptions used to determine benefit obligation at December 31
Discount rate 5.65 % 5.00 % 5.19 %
Plan assets are primarily invested in liability hedging assets which include money market securities, inflation linked debt securities, public corporate debt securities and government debt securities that are actively managed to match the duration of the plans’ liabilities.
At each measurement date, we estimate the net asset values and fair values of our pension assets using various valuation techniques. For certain investments, we use the net asset value (NAV) as a practical expedient to estimating fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels as described below:
Level 1: Quoted prices in active markets for identical assets or liabilities
Level 2: Inputs that are derived principally from or corroborated by observable market data
Level 3: Inputs that are unobservable and significant to the overall fair value measurement
The fair values and net asset values of our pension plan assets at December 31, 2024 and 2023 are in the tables below. The assets in the common/collective trusts and in the private partnerships consist of both return seeking and liability hedging investments.
FAIR VALUE MEASUREMENTS AT DECEMBER 31, 2024
in millions Level 1 Level 2 Level 3 Total
Asset Category
Debt funds $ 0.0 $ 590.2 $ 0.0 $ 590.2
Investments in the fair value hierarchy $ 0.0 $ 590.2 $ 0.0 $ 590.2
Interest in common/collective trusts (at NAV) 13.1
Private partnerships (at NAV) 3.8
Total pension plan assets $ 607.1
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FAIR VALUE MEASUREMENTS AT DECEMBER 31, 2023
in millions Level 1 Level 2 Level 3 Total
Asset Category
Debt funds $ 0.0 $ 634.9 $ 0.0 $ 634.9
Investments in the fair value hierarchy $ 0.0 $ 634.9 $ 0.0 $ 634.9
Interest in common/collective trusts (at NAV) 9.3
Private partnerships (at NAV) 3.7
Total pension plan assets $ 647.9
The following describes the types of investments included in each asset category listed in the tables above and the valuation techniques we used to determine the fair values or net asset values as of December 31, 2024 and 2023.
The debt funds category consists of U.S. federal, state and local government debt securities, corporate debt securities, foreign government debt securities, asset-backed securities and derivatives. The fair values of U.S. government and corporate debt securities are based on current market rates and credit spreads for debt securities with similar maturities. The fair values of debt securities issued by foreign governments are based on prices obtained from broker/dealers and international indices. The fair values of asset-backed securities are priced using prepayment speed and spread inputs that are sourced from the new issue market. Derivatives are valued using pricing models based on the prevailing forward exchange rate of the underlying currencies taking into account the creditworthiness of the counterparties.
Common/collective trust fund investments consist of an index fund investing primarily in domestic equities and a short-term investment fund for highly liquid, short-term debt securities. Investments are valued at the NAV of units of a bank collective trust. The NAV is based on the fair value of the underlying investments held by the fund less its liabilities. This practical expedient is not used when it is determined to be probable that the fund will sell the investment for an amount different than the reported NAV.
The private partnerships category consists primarily of secondary private equity funds and mezzanine debt funds. The NAV of these investments has been estimated based on methods employed by the general partners, including reference to third-party transactions and valuations of comparable companies.
Total employer contributions to the pension plans are presented below:
in millions Pension
Employer Contributions
2022 $ 7.8
2023 7.4
2024 8.7
2025 (estimated) 13.8
For our qualified pension plans, we made a contribution of $2.0 million in 2024 and made no contributions during 2023 and 2022. We anticipate making a $9.6 million contribution to our qualified pension plans in 2025. For our nonqualified pension plans, we contributed $6.7 million, $7.4 million and $7.8 million during 2024, 2023 and 2022, respectively, and expect to contribute $4.2 million during 2025.
The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid:
in millions Pension
Estimated Future Benefit Payments
2025 $ 48.0
2026 48.5
2027 49.6
2028 49.6
2029 50.0
2030-2034 247.5
We contribute to a number of multiemployer defined benefit pension plans under the terms of collective-bargaining agreements for union-represented employees. The risks of participating in multiemployer plans differ from single employer plans as follows:
▪assets contributed to a multiemployer plan by one employer may be used to provide benefits to employees of other participating employers
▪if a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers
▪if we cease to have an obligation to contribute to one or more of the multiemployer plans to which we contribute, we may be required to pay those plans an amount based on the underfunded status of the plan, referred to as a withdrawal liability
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None of the multiemployer pension plans that we participate in are individually significant. Our contributions to individual multiemployer pension plans did not exceed 5% of the plans’ total contributions in the three years ended December 31, 2024, 2023 and 2022. Total contributions to multiemployer pension plans were $30.2 million, $36.6 million and $48.6 million in 2024, 2023 and 2022, respectively.
As of December 31, 2024, a total of 14.7% of our domestic hourly labor force was covered by collective-bargaining agreements. Of such employees covered by collective-bargaining agreements, 48.8% were covered by agreements that expire in 2025. We also employed 248 union employees in Mexico who are covered by a collective-bargaining agreement that will expire in 2025. None of our union employees in Mexico participate in multiemployer pension plans.
In addition to the pension plans noted above, we had one unfunded supplemental retirement plan as of December 31, 2024 and 2023. The accrued costs for the supplemental retirement plan were $0.5 million and $0.4 million at December 31, 2024 and 2023, respectively.
POSTRETIREMENT PLANS
In addition to pension benefits, we provide certain healthcare and life insurance benefits for some retired employees. Our employer portion of the medical coverage cost for the postretirement healthcare plan is capped. Substantially all of our salaried employees and, where applicable, certain of our hourly employees may become eligible for these benefits if they reach a qualifying age and meet certain service requirements. Generally, Company-provided healthcare benefits end when covered individuals become eligible for Medicare benefits, become eligible for other group insurance coverage or reach age 65 (whichever occurs first).
The following table sets forth the combined funded status of the plans and their reconciliation with the related amounts recognized in our consolidated financial statements at December 31:
in millions 2024 2023
Change in Benefit Obligation
Projected benefit obligation at beginning of year $ 44.2 $ 41.8
Service cost 2.2 2.0
Interest cost 2.2 2.0
Actuarial (gain) loss (3.0) 3.6
Benefits paid (3.4) (5.2)
Projected benefit obligation at end of year $ 42.2 $ 44.2
Change in Fair Value of Plan Assets
Fair value of assets at beginning of year $ 0.0 $ 0.0
Actual return on plan assets 0.0 0.0
Fair value of assets at end of year $ 0.0 $ 0.0
Funded status $ (42.2) $ (44.2)
Net amount recognized $ (42.2) $ (44.2)
Amounts Recognized in the Consolidated Balance Sheets
Current liabilities $ (4.7) $ (5.2)
Noncurrent liabilities (37.5) (39.0)
Net amount recognized $ (42.2) $ (44.2)
Amounts Recognized in Accumulated Other Comprehensive Income
Net actuarial gain $ (15.0) $ (12.7)
Prior service cost 10.2 11.7
Total amount recognized $ (4.8) $ (1.0)
The increase in actuarial gain as of December 31, 2024 was primarily attributable to the increase in discount rates and favorable claims experience for the plans compared with the prior year.
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The following table sets forth the components of net periodic benefit cost, amounts recognized in other comprehensive income, weighted-average assumptions and assumed trend rates of the plans at December 31:
dollars in millions 2024 2023 2022
Components of Net Periodic Postretirement Benefit Cost
Service cost $ 2.2 $ 2.0 $ 2.2
Interest cost 2.2 2.0 0.9
Amortization of prior service cost (credit) 1.4 1.4 (0.3)
Amortization of actuarial gain (0.7) (1.5) (1.3)
Net periodic postretirement benefit cost $ 5.1 $ 3.9 $ 1.5
Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income
Net actuarial (gain) loss $ (3.0) $ 3.6 $ (2.4)
Reclassification of prior service (cost) credit (1.4) (1.4) 0.3
Reclassification of actuarial gain 0.7 1.5 1.3
Amount recognized in other comprehensive income $ (3.7) $ 3.7 $ (0.8)
Amount recognized in net periodic postretirement benefit cost and other comprehensive income $ 1.4 $ 7.6 $ 0.7
Assumptions
Assumed Healthcare Cost Trend Rates at December 31
Healthcare cost trend rate assumed for next year (Pre-65/Post-65) 8.45% / n/a
10.20% / n/a
7.04% / n/a
Rate to which the cost trend rate gradually declines 4.50 % 4.50 % 4.50 %
Year that the rate reaches the rate it is assumed to maintain 2035 2031 2030
Weighted-average assumptions used to determine net periodic benefit cost for years ended December 31
Discount rate - PBO 4.90 % 5.09 % 2.59 %
Discount rate - service cost
4.96 % 5.15 % 2.89 %
Discount rate - interest cost 4.85 % 5.03 % 2.06 %
Weighted-average assumptions used to determine benefit obligation at December 31
Discount rate 5.51 % 4.90 % 5.08 %
Total employer contributions to the postretirement plans are presented below:
in millions Postretirement
Employer Contributions
2022 $ 4.9
2023 5.2
2024 3.4
2025 (estimated) 4.7
The employer contributions shown above are equal to the cost of benefits during the year. The plans are not funded and are not subject to any regulatory funding requirements.
The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid:
in millions Postretirement
Estimated Future Benefit Payments
2025 $ 4.7
2026 4.9
2027 5.1
2028 5.1
2029 5.0
2030-2034 21.4
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Contributions by participants to the postretirement benefit plans for the years ended December 31 are as follows:
in millions Postretirement
Participants Contributions
2022 $ 2.0
2023 1.5
2024 1.7
PENSION AND OTHER POSTRETIREMENT BENEFITS ASSUMPTIONS
Each year, we review our assumptions for discount rates (used for PBO, service cost, and interest cost calculations), the per capita cost of healthcare benefits and the expected return on plan assets. Due to plan changes made in 2013, annual pay increases do not materially impact plan obligations.
We use a high-quality bond full yield curve approach (specific spot rates for each annual expected cash flow) to establish the discount rates at each measurement date. At December 31, 2024, the discount rates used were as follows:
▪PBO for various plans - ranged from 5.25% to 5.73% (December 31, 2023 ranged from 4.77% to 5.05%)
▪Service cost - weighted average of 5.10% and 4.96% for our pension plans and our other postretirement plans, respectively
(2023 figures were 5.29% and 5.15%, respectively)
▪Interest cost - weighted average of 4.90% and 4.85% for our pension plans and our other postretirement plans, respectively
(2023 figures were 5.09% and 5.03%, respectively)
In selecting the rate of increase in the per capita cost of covered healthcare benefits, we consider past performance and forecast of future healthcare cost trends. At December 31, 2024, our assumed rate of increase in the per capita cost of covered healthcare benefits was 8.45% for pre-65 coverage, with rates decreasing each year until reaching 4.50% in 2035 and remaining level thereafter.
Our expected return on plan assets is a long-term view based on our current asset allocation and a judgment informed by consultation with our retirement plans’ consultant and our pension plans’ actuary. For 2024 and 2023, the expected return on plan assets used to measure plan benefit costs was set at 4.85% and 4.85%, respectively. For 2025, the preliminary expected return on plan assets is 5.90%.
DEFINED CONTRIBUTION PLANS
In addition to our pension and postretirement plans, we sponsor seven defined contribution plans. Substantially all salaried and non-union hourly employees are eligible to be covered by one of these plans. Under these plans, we match employees’ eligible contributions at established rates. Expense recognized in connection with these matching obligations totaled $87.5 million, $79.2 million and $68.2 million in 2024, 2023 and 2022, respectively.
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NOTE 11: INCENTIVE PLANS
SHARE-BASED COMPENSATION PLANS
Our 2016 Omnibus Long-term Incentive Plan (Plan) authorizes the granting of performance shares, restricted shares, Stock-Only Stock Appreciation Rights (SOSARs) and other types of share-based awards to key salaried employees and nonemployee directors. The maximum number of shares that may be issued under the Plan is 8,000,000, of which 4,396,033 shares remain under this authorization as of December 31, 2024.
PERFORMANCE SHARES - Each performance share unit is equal to and paid in one share of our common stock but carries no voting rights. The number of units ultimately paid for performance share awards may range from 0% to 200% of the number of units awarded on the date of grant. Payment is based upon the outcome of performance and/or market conditions. Awards vest on December 31 of the third year after date of grant. Vesting is accelerated upon death, disability, or change of control and the awards become non-forfeitable upon reaching retirement age - all as defined in the award agreement. Nonvested units are forfeited upon termination for any other reason. Expense provisions referable to performance share awards amounted to $30.4 million, $40.1 million and $23.2 million in 2024, 2023 and 2022, respectively.
The fair value of performance shares is estimated as of the date of grant using a Monte Carlo simulation model. The following table summarizes the activity for nonvested performance share units during the year ended December 31, 2024:
Number
of Shares Weighted-Average Grant Date Fair Value
Performance Shares
Nonvested at January 1, 2024 227,472 $ 180.13
Granted 110,240 247.00
Vested (105,541) 185.31
Canceled/forfeited (8,625) 207.00
Nonvested at December 31, 2024 223,546 $ 209.62
During 2023 and 2022, the weighted-average grant date fair value of performance shares granted was $175.46 and $185.31, respectively.
The aggregate values for distributed performance share awards are based on the closing price of our common stock as of the distribution date. The aggregate values of distributed performance shares for the years ended December 31 are as follows:
in millions 2024 2023 2022
Aggregate value of distributed performance shares $ 45.3 $ 24.8 $ 33.4
RESTRICTED SHARES - Each restricted share unit is equal to and paid in one share of our common stock but carries no voting rights. Awards vest on the third anniversary of the grant date. Vesting is accelerated upon reaching retirement age, death, disability, or change of control, all as defined in the award agreement. Nonvested units are forfeited upon termination for any other reason. Expense provisions referable to restricted share awards amounted to $15.1 million, $16.5 million and $11.6 million in 2024, 2023 and 2022, respectively.
The fair value of restricted shares is estimated as of the date of grant based on the stock price adjusted for dividends foregone (for restricted share units that do not accrue dividends). The following table summarizes the activity for nonvested restricted share units during the year ended December 31, 2024:
Number
of Shares Weighted-Average
Grant Date
Fair Value
Restricted Stock Units
Nonvested at January 1, 2024 236,673 $ 175.29
Granted 71,087 247.00
Vested (61,320) 166.42
Canceled/forfeited (10,864) 200.35
Nonvested at December 31, 2024 235,576 $ 198.08
During 2023 and 2022, the weighted-average grant date fair value of restricted shares granted was $175.46 and $184.49, respectively.
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The aggregate values for distributed restricted share awards are based on the closing price of our common stock as of the distribution date. The aggregate values of distributed restricted shares for the years ended December 31 are as follows:
in millions 2024 2023 2022
Aggregate value of distributed restricted shares $ 15.6 $ 11.1 $ 15.7
STOCK-ONLY STOCK APPRECIATION RIGHTS (SOSARs) - SOSARs granted have an exercise price equal to the market value of our underlying common stock on the date of grant. The SOSARs vest ratably over 3 years and expire 10 years subsequent to the date of grant. Vesting is accelerated upon reaching retirement age, death, disability, or change of control, all as defined in the award agreement. Nonvested awards are forfeited upon termination for any other reason.
The fair value of SOSARs is estimated as of the date of grant using the Black-Scholes option pricing model. Compensation cost for SOSARs is based on this grant date fair value and is recognized for awards that ultimately vest. The following table presents the weighted-average fair value and the weighted-average assumptions used in estimating the fair value of grants during the years ended December 31:
2024 2023 2022
SOSARs
Fair value $ 86.32 $ 72.39 $ 60.57
Risk-free interest rate 1.94 % 3.90 % 2.02 %
Dividend yield 0.84 % 0.79 % 0.77 %
Volatility 28.81 % 28.88 % 26.68 %
Expected term (years) 9.0 9.0 9.0
The risk-free interest rate is based on the yield at the date of grant of a U.S. Treasury security with a maturity period approximating the SOSARs expected term. The dividend yield assumption is based on our historical dividend payouts adjusted for current expectations of future payouts. The volatility assumption is based on the historical volatility and expectations about future volatility of our common stock over a period equal to the SOSARs expected term. The expected term is based on historical experience and expectations about future exercises and represents the period of time that SOSARs granted are expected to be outstanding.
A summary of our SOSAR activity as of December 31, 2024 and changes during the year are presented below:
Number
of Shares Weighted-Average
Exercise Price Weighted-Average
Remaining
Contractual
Life (Years) Aggregate
Intrinsic Value
(in millions)
SOSARs
Outstanding at January 1, 2024 533,457 $ 134.35
Granted 60,730 253.43
Exercised (168,420) 106.43
Forfeited or expired 0 0.00
Outstanding at December 31, 2024 425,767 $ 162.38 5.83 $ 40.9
Exercisable at December 31, 2024 303,269 $ 140.10 4.76 $ 35.9
The aggregate intrinsic values in the table above represent the total pretax intrinsic value (the difference between our stock price on the last trading day of 2024 and the exercise price, multiplied by the number of in-the-money SOSARs) that would have been received by the option holders had all SOSARs been exercised on December 31, 2024. These values change based on the fair market value of our common stock. The aggregate intrinsic values of SOSARs exercised for the years ended December 31 are as follows:
in millions 2024 2023 2022
Aggregate intrinsic value of SOSARs exercised $ 27.9 $ 25.1 $ 1.9
The following table presents cash received and tax benefit realized from SOSAR exercises and compensation cost recorded referable to SOSARs for the years ended December 31:
in millions 2024 2023 2022
SOSARs
Cash received from exercises $ 0.0 $ 0.0 $ 0.0
Tax benefit from exercises 5.7 6.0 0.4
Compensation cost 5.1 4.0 4.0
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NONEMPLOYEE DIRECTOR AWARDS - In addition to the share-based compensation plans for employees discussed above, we issue a limited number of stock units to our nonemployee directors annually. Expense provisions referable to nonemployee director stock units amounted to $2.8 million, $2.6 million and $2.4 million in 2024, 2023 and 2022, respectively.
CASH-BASED COMPENSATION PLANS
We have incentive plans under which cash awards may be made annually. Expense provisions under these plans referable to awards to officers and certain employees amounted to $58.8 million, $77.3 million and $42.8 million in 2024, 2023 and 2022, respectively.
NOTE 12: COMMITMENTS AND CONTINGENCIES
We have commitments in the form of unconditional purchase obligations as of December 31, 2024. These include commitments for the purchase of property, plant & equipment of $78.2 million and commitments for noncapital purchases of $146.8 million. These commitments are due as follows:
in millions Unconditional
Purchase
Obligations
Property, Plant & Equipment
2025 $ 78.2
Thereafter 0.0
Total $ 78.2
Noncapital (primarily transportation and electricity contracts)
2025 $ 42.4
2026-2027 56.1
2028-2029 42.3
Thereafter 6.0
Total $ 146.8
Expenditures for noncapital purchases totaled $117.6 million, $120.8 million and $96.7 million in 2024, 2023 and 2022, respectively.
We have commitments in the form of minimum royalties under mineral leases as of December 31, 2024 in the amount of $237.6 million, due as follows:
in millions Mineral
Leases
Minimum Royalties
2025 $ 27.5
2026-2027 43.5
2028-2029 29.9
Thereafter 136.7
Total $ 237.6
Expenditures for royalties under mineral leases totaled $118.6 million, $113.6 million and $109.1 million in 2024, 2023 and 2022, respectively.
Certain of our aggregates reserves are burdened by volumetric production payments (nonoperating interest) as described in Note 2. As the holder of the working interest, we have responsibility to bear the cost of mining and producing the reserves attributable to this nonoperating interest.
As described in Note 1 under the caption "Claims and Litigation Including Self-Insurance", our net liabilities for our self-insurance program totaled $119.6 million as of December 31, 2024.
As summarized by purpose in Note 6, our standby letters of credit totaled $104.8 million as of December 31, 2024.
As outlined in Note 7, our present value of future minimum (nonmineral) lease payments totaled $591.1 million as of December 31, 2024.
As described in Note 9, our liability for unrecognized tax benefits is $24.9 million as of December 31, 2024.
As described in Note 17, our asset retirement obligations totaled $427.4 million as of December 31, 2024.
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LITIGATION AND ENVIRONMENTAL MATTERS
We are subject to occasional governmental proceedings and orders pertaining to occupational safety and health or to protection of the environment, such as proceedings or orders relating to noise abatement, air emissions or water discharges. As part of our continuing program of stewardship in safety, health and environmental matters, we have been able to resolve such proceedings and to comply with such orders without any material adverse effects on our business.
We have received notices from the United States Environmental Protection Agency (EPA) or similar state or local agencies that we are considered a potentially responsible party (PRP) at a limited number of sites under the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA or Superfund) or similar state and local environmental laws. Generally, we share the cost of remediation at these sites with other PRPs or alleged PRPs in accordance with negotiated or prescribed allocations. There is inherent uncertainty in determining the potential cost of remediating a given site and in determining any individual party's share in that cost. As a result, estimates can change substantially as additional information becomes available regarding the nature or extent of site contamination, remediation methods, other PRPs and their probable level of involvement, and actions by or against governmental agencies or private parties.
We have reviewed the nature and extent of our involvement at each Superfund site as well as potential obligations arising under other federal, state and local environmental laws. While ultimate resolution and financial liability is uncertain at a number of the sites, in our opinion, based on information currently available, the ultimate resolution of claims and assessments related to these sites will not have a material effect on our consolidated results of operations, financial position or cash flows, although amounts recorded in a given period could be material to our results of operations or cash flows for that period. Amounts accrued for environmental matters are presented in Note 8.
We are a defendant in various lawsuits in the ordinary course of business. It is not possible to determine with precision the outcome, or the amount of liability, if any, under these lawsuits, especially where the cases involve possible jury trials with as yet undetermined jury panels.
In addition to these lawsuits in which we are involved in the ordinary course of business, certain other material legal proceedings are specifically described below.
▪LOWER PASSAIC RIVER STUDY AREA (DISCONTINUED OPERATIONS and SUPERFUND SITE) - The Lower Passaic River Study Area is part of the Diamond Shamrock Superfund Site in New Jersey. Vulcan and approximately 70 other companies are parties (collectively the Cooperating Parties Group, CPG) to a May 2007 Administrative Order on Consent (AOC) with the EPA to perform a Remedial Investigation/Feasibility Study (draft RI/FS) of the lower 17 miles of the Passaic River (River). The draft RI/FS was submitted recommending a targeted hot spot remedy; however, the EPA issued a record of decision (ROD) in March 2016 that calls for a bank-to-bank dredging remedy for the lower 8 miles of the River. The EPA estimates that the cost of implementing this proposal is $1.38 billion. In September 2016, the EPA entered into an Administrative Settlement Agreement and Order on Consent with Occidental Chemical Corporation (Occidental) in which Occidental agreed to undertake the remedial design for this bank-to-bank dredging remedy and to reimburse the United States for certain response costs.
Efforts to investigate and remediate the River have been underway for many years and have involved hundreds of entities that have had operations on or near the River at some point during the past several decades. We formerly owned a chemicals operation near the mouth of the River, which was sold in 1974. The major risk drivers in the River have been identified to include dioxins, PCBs, DDx and mercury. We did not manufacture any of these risk drivers and have no evidence that any of these were discharged into the River by Vulcan.
In August 2017, the EPA informed certain members of the CPG, including Vulcan and others, that it planned to use the services of a third-party allocator with the expectation of offering cash-out settlements to some parties in connection with the bank-to-bank remedy identified in the ROD. This voluntary allocation process established an impartial third-party expert recommendation for use by the government and the participants as the basis of possible settlements, including settlements related to future remediation actions. The final allocation recommendations, which are subject to confidentiality provisions, were submitted to the EPA for its review and consideration in late December 2020. Certain PRPs, including Vulcan, thereafter received a joint confidential settlement demand from the EPA/Department of Justice (DOJ). Vulcan and certain of the other PRPs that received the joint confidential settlement demand (the Settling Defendants) reached an agreement to settle with the EPA/DOJ and negotiated a Consent Decree. The court granted the motion to enter the Consent Decree in December 2024. Vulcan’s portion of the settlement is within the immaterial loss recorded for this matter in 2015.
In July 2018, Vulcan, along with more than 100 other defendants, was sued by Occidental in United States District Court for the District of New Jersey, Newark Vicinage. Occidental is seeking cost recovery and contribution under CERCLA for costs related to the River. This lawsuit is currently stayed. In another related proceeding, Occidental filed a lawsuit in March 2023 against Vulcan and 39 other defendants in United States District Court for the District of New Jersey, Newark Vicinage seeking cost recovery and contribution under CERCLA for costs related to the upper 9 miles of the River. It is unknown at this time how the settlement and approval of the Consent Decree with the EPA/DOJ would affect the Occidental lawsuits.
▪TEXAS BRINE MATTER (DISCONTINUED OPERATIONS) - During operation of its former Chemicals Division, Vulcan leased the right to mine salt out of an underground salt dome formation in Assumption Parish, Louisiana from 1976 - 2005. Throughout that period, Texas Brine Company (Texas Brine) was the operator contracted by Vulcan to mine and deliver the salt as brine. We sold our Chemicals Division in 2005 and transferred our rights and interests related to the salt and mining operations to the purchaser, a subsidiary of Occidental Chemical Company (Occidental), and we have had no association with the leased premises or Texas Brine since that time. In August 2012, a sinkhole developed in the vicinity of the Texas Brine mining operations. Numerous lawsuits were filed thereafter in state court in Assumption Parish, Louisiana. Other lawsuits, including class action litigation, were filed in the United States District Court for the Eastern District of Louisiana in New Orleans.
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In these lawsuits, the main plaintiffs sued numerous defendants, including Texas Brine, Occidental and Vulcan, alleging various damages including, but not limited to, property damages; a claim by the State of Louisiana for response costs and civil penalties; physical damages to oil and gas pipelines and storage facilities (pipelines); and business interruption losses. All such claims have been settled except for the claims by the State of Louisiana. Our insurers to date have funded these settlements in excess of our self-insured retention amount.
Additionally, Texas Brine, Occidental and Vulcan sued each other in various state and federal court forums. Vulcan and Occidental have since dismissed all of their claims against one another; Texas Brine and Occidental have settled their claims against each other; and Texas Brine’s and Vulcan’s claims against each other are pending in state and federal court. In general, Texas Brine alleges that the sinkhole was caused, in whole or in part, by our negligent or fraudulent actions or failure to act; that we breached the salt lease with Occidental, as well as an operating agreement and related contracts with Texas Brine; that we were strictly liable for certain property damages in our capacity as a former lessee of the salt lease; and that we violated the agreement under which we sold our Chemicals Division to Occidental. Texas Brine’s claims against Vulcan include claims for past and future response costs, lost profits and investment costs, indemnity payments, attorneys’ fees, other litigation costs, and judicial interests. Texas Brine also recently filed a lawsuit against Vulcan seeking indemnity for potential exposure Texas Brine may have to Occidental in the related arbitration, the State of Louisiana, and for ongoing and future Louisiana regulatory matters. In August 2022, we removed the lawsuit to federal court.
The state court held a joint bench trial (judge only) in 2017 in three cases brought by pipeline companies claiming damages to their facilities as a result of the sinkhole. This “Phase 1” trial was limited in scope to comparative fault and liability for causing the sinkhole. In December 2017, the trial court issued a ruling allocating fault as follows: Occidental 50%, Texas Brine (and its wholly-owned subsidiary) 35% and Vulcan 15%. In December 2020, the Louisiana Court of Appeal, First Circuit reversed the judgment in part in one of the three jointly tried cases, allocating 55% of the fault to Texas Brine (and its wholly-owned subsidiary); 30% to Occidental; and affirming the 15% fault allocation to Vulcan. In May 2021 and April 2022, the Court of Appeal issued judgments in the other two pipeline cases, adopting the same fault allocation. The Louisiana Supreme Court has declined to review the judgments, resulting in final judgments regarding fault allocations in those matters.
In the second quarter of 2022, we recorded an immaterial loss related to the claims brought by Texas Brine. In August 2022, Vulcan and Texas Brine commenced a joint “Phase 2” bench trial in the same three pipeline cases where fault was allocated. Prior to trial, the trial court granted various motions by Vulcan seeking dismissal of Texas Brine’s contract-based claims and hundreds of millions of dollars in alleged damages. Thus, the Phase 2 trial addressed the claims that remained pending between Texas Brine and Vulcan after that motion practice. During the Phase 2 trial, Texas Brine and Vulcan reached a negotiated joint stipulation as to the amount of Texas Brine’s damages for its surviving tort claims at issue in the trial. After applying Vulcan’s 15% fault allocation, Vulcan’s stipulated financial responsibility for the damages at issue in the trial is within the immaterial loss recorded during the second quarter of 2022. In December 2022, the trial court entered a judgment in the pipeline cases reflecting this stipulation. Texas Brine moved to assess all trial costs against Vulcan. Texas Brine and Vulcan thereafter reached a settlement, wherein Vulcan agreed to pay a portion of Texas Brine's trial costs, the amount of which was within the remaining immaterial loss recorded in the second quarter of 2022.
The December 2022 Phase 2 judgment did not address numerous of Texas Brine’s claims seeking hundreds of millions of dollars in damages that were dismissed prior to trial. Texas Brine appealed those judgments. In December 2024, the Court of Appeal affirmed the dismissal of most of those damage claims but remanded the dispute to the District Court for further adjudication of an indemnity claim under one of the agreements. We cannot at this time reasonably estimate the range of liability, if any, that could result from Texas Brine's indemnity claim or should the Louisiana Supreme Court exercise jurisdiction to review any of the December 2024 appellate court rulings. At this time, we also cannot reasonably estimate a range of liability pertaining to the claims brought by the State of Louisiana.
▪1,1,1-TRICHLOROETHANE LITIGATION (DISCONTINUED OPERATIONS) - During the operation of our former Chemicals Division, which was divested to Occidental in 2005, Vulcan manufactured a chlorinated solvent known as 1,1,1-trichloroethane. Vulcan faces liabilities related to 1,1,1-trichloroethane stabilized with 1,4-dioxane ("TCA"). We are one of the defendants in cases filed in both state and federal courts, including one case filed by the State of New Jersey. According to the various complaints, the plaintiffs seek damages including, but not limited to, unspecified compensatory damages associated with the remediation of water wells allegedly contaminated with 1,4-dioxane, natural resource damages, disgorgement of profits from the sale of TCA, punitive damages, as well as penalties and attorney's fees under various statutes. We will vigorously defend these cases on substantive and procedural grounds. At this time, we cannot determine the likelihood of loss, or reasonably estimate a range of loss, if any, pertaining to the above-referenced cases.
▪HEWITT LANDFILL MATTER (SUPERFUND SITE) - In September 2015, the Los Angeles Regional Water Quality Control Board (RWQCB) issued a Cleanup and Abatement Order directing Calmat Co., a Vulcan subsidiary (hereinafter "Vulcan") to assess, monitor, cleanup, and abate wastes that have been discharged to soil, soil vapor, and/or groundwater at the former Hewitt Landfill in Los Angeles.
Following an onsite and offsite investigation and pilot scale testing, the RWQCB approved a corrective action under a Cleanup and Abatement Order (CAO) to include leachate recovery, storm water capture and conveyance improvements, and a groundwater pump, treat and reinjection system. Certain on-site source control measures have been implemented, and the treatment system is fully operational. In October 2024, the RWQCB made a request under the CAO for a work plan to install additional monitoring wells and optimize and expand the existing on-site remediation system. This request complements expansion discussions with the EPA and other stakeholders, as part of the Alternative Design Work Plan (ADWP) which was submitted in January 2025. Currently-anticipated costs of these on-site source control activities, including those associated with this work plan, have been fully accrued.
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We are also engaged in an ongoing dialogue with the EPA, Honeywell, and the Los Angeles Department of Water and Power (LADWP) regarding the potential contribution of the Hewitt Landfill to groundwater contamination in the North Hollywood Operable Unit (NHOU) of the San Fernando Valley Superfund Site.
The EPA and Vulcan entered into an AOC and Statement of Work having an effective date of September 2017 for the design of two extraction wells south of the Hewitt Landfill to protect the North Hollywood West (NHW) well field located within the NHOU. In November 2017, we submitted a Pre-Design Investigation (PDI) Work Plan to the EPA, which sets forth the activities and schedule for collection of data in support of our evaluation of the need for an offsite remedy. In addition, this evaluation was expanded as part of the PDI to include the evaluation of a remedy in light of LADWP’s Rinaldi-Toluca (RT) wellfield project. PDI investigative activities were completed between the first and third quarters of 2018, and in December 2018 we submitted a Draft PDI Evaluation Report to the EPA. The Draft PDI Evaluation Report summarizes data collection activities conducted pursuant to the Draft PDI Work Plan and provides model updates and evaluation of remediation alternatives for offsite areas. The EPA provided a final set of comments to the Draft PDI Evaluation Report in October 2020. The final set of comments included a request that Vulcan revise and develop a final PDI Evaluation Report. The final comments further provided a proposal for an alternative approach for offsite remediation (as opposed to installation of offsite extraction wells) and development of a Supplemental PDI Evaluation Report (Supplemental Report) that would require the EPA to modify the remedy in the record of decision as it relates to the Hewitt Landfill. In December 2020, we submitted the Final PDI Evaluation Report, which included responses to the EPA’s comments.
At the EPA's request, we submitted a Supplemental Report in March 2023 and an ADWP in May 2023. Similar to the PDI Evaluation Report, the Supplemental Report and ADWP identified expansion of the onsite Hewitt remedy in conjunction with the offsite treatment being performed by LADWP as the preferred option for addressing contamination in offsite areas, instead of the two wells proposed by the EPA. In conjunction with its review of the Supplemental Report, the EPA held an initial meeting with stakeholders, including LADWP, in November 2023 and has requested additional meetings to determine a path forward.
In December 2019, Honeywell agreed with LADWP to build a water treatment system (often referred to as the Cooperative Containment Concept or CCC or the second interim remedy) that will provide treated groundwater in the NHOU to LADWP for public water supply purposes. Honeywell contends that some of the contamination to be remediated by the treatment system it is building originated from the Hewitt Landfill and that Vulcan should fund some portion of the costs that Honeywell has incurred and will incur in developing and implementing the second interim remedy. During the fourth quarter of 2021, we completed a partial settlement with Honeywell related to certain of the costs that Honeywell has incurred for an immaterial amount. In March 2023, Honeywell filed a lawsuit against Vulcan and a third party alleging that Honeywell has incurred more than $11 million in costs to resolve its liability to the EPA and that it estimates that it will spend in excess of $100 million to construct and operate its water treatment system. Honeywell seeks an "equitable share of necessary response costs" from Vulcan and the third party, which claims indemnity from Vulcan. Discussions are ongoing with Honeywell regarding the reasonable costs Honeywell has incurred. We are also gathering and analyzing data and developing technical information to determine the extent of possible contribution by the Hewitt Landfill to the groundwater contamination in the area. Based on this technical information and recent settlement discussions, we have accrued an immaterial amount for our contribution of costs anticipated to be incurred by Honeywell. This work is also intended to assist in identification of other PRPs that may have contributed to groundwater contamination in the area.
Further, LADWP is constructing two new production and treatment facilities at city wellfields located near the Hewitt Landfill - the NHW wellfield and the RT wellfield (also referred to as the NHW treatment system and North Hollywood Central (NHC) treatment system, respectively). LADWP has alleged that the Hewitt Landfill is one of the primary sources of contamination at the NHW treatment system and one of the sources of contamination at the NHC treatment system. According to information available on the California State Water Resources Control Board (SWRCB) website, the capital cost of the NHW treatment system is estimated at $92 million, and the capital cost of the NHC treatment system is estimated at $245 million. The NHW system commenced operation in late 2024, and the NHC system is expected to commence operation in 2025. Both systems will incur costs for operation and maintenance. LADWP has applied for and received substantial funding to contribute to both treatment systems from grants of Proposition 1 bond funding from the SWRCB. According to information available on the SWRCB website, the bond money obtained for the NHW treatment system is $46 million, and the bond money obtained for the NHC treatment system is $95 million.
We anticipate continued discussions with LADWP regarding its potential claims. In conjunction with those discussions, we are engaging in further efforts to gather and analyze records and data in order to assess the extent of possible contribution by the Hewitt Landfill to the groundwater contamination in the area, consistent with the parallel request by the EPA, and the reasonableness of LADWP’s remediation efforts. This work is also intended to assist in identification of other PRPs that may have contributed to groundwater contamination in the area of the NHW and RT wellfields. Together, these efforts will allow us to analyze our anticipated equitable contribution to LADWP’s remediation efforts. Among other factors, we anticipate that any equitable contribution should take into account the on-site source control and other measures implemented by Vulcan at the former Hewitt Landfill, the relative contribution and duration of any contaminants originating from the Hewitt Landfill to the LADWP systems, and the cost effectiveness of the LADWP systems. At this time, we cannot reasonably estimate a range of a loss to Vulcan pertaining to LADWP’s potential contribution claim.
▪NAFTA ARBITRATION - In September 2018, our subsidiary Legacy Vulcan, LLC (Legacy Vulcan), on its own behalf, and on behalf of our Mexican subsidiary Calizas Industriales del Carmen, S.A. de C.V. (Calica), served the United Mexican States (Mexico) a Notice of Intent to Submit a Claim to Arbitration under Chapter 11 of the North American Free Trade Agreement (NAFTA). This NAFTA claim relates to the treatment of a portion of our quarrying operations in Quintana Roo, Mexico arising from, among other measures, Mexico’s failure to comply with a legally binding zoning agreement and relates to other unfair, arbitrary and capricious actions by Mexico’s environmental enforcement agency. We assert that these actions are in breach of Mexico’s international obligations under NAFTA and international law.
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As required by Article 1118 of NAFTA, we sought to settle this dispute with Mexico through consultations. Notwithstanding our good faith efforts to resolve the dispute amicably, we were unable to do so and filed a Request for Arbitration with the International Centre for Settlement of Investment Disputes (ICSID) in December 2018. In January 2019, ICSID registered our Request for Arbitration.
A hearing on the merits took place in July 2021. While we awaited the final resolution from the tribunal, we continued to engage with government officials to pursue an amicable resolution of the dispute. On May 5, 2022, Mexican government officials unexpectedly and arbitrarily shut down Calica’s remaining operations in Mexico. On May 8, 2022, Legacy Vulcan filed an application in the NAFTA arbitration seeking provisional measures and leave to file an ancillary claim in connection with this latest shutdown (see Part II, Item 7 "Management’s Discussion and Analysis of Financial Condition and Results of Operations" under the caption "Known Trends or Uncertainties"). In July 2022, the NAFTA arbitration tribunal granted Legacy Vulcan’s application and ordered Mexico not to take any action that might further aggravate the dispute between the parties or render the resolution of the dispute potentially more difficult. A hearing on the merits of the ancillary claim took place in August 2023. We expect that the NAFTA arbitration tribunal will issue a decision on the claim and ancillary claim during the first half of 2025.
At this time, there can be no assurance whether we will be successful in our NAFTA claim and ancillary claim, and we cannot quantify the amount we may recover, if any, under this arbitration proceeding if we are successful.
It is not possible to predict the ultimate outcome of these and other legal proceedings in which we are involved, and a number of factors, including developments in ongoing discovery or adverse rulings, or the verdict of a particular jury, could cause actual losses to differ materially from accrued costs. No liability was recorded for claims and litigation for which a loss was determined to be only reasonably possible or for which a loss could not be reasonably estimated. Legal costs incurred in defense of lawsuits are expensed as incurred. In addition, losses on certain claims and litigation described above may be subject to limitations on a per occurrence basis by excess insurance, as described in Note 1 under the caption "Claims and Litigation Including Self-Insurance."
NOTE 13: EQUITY
Our capital stock consists solely of common stock, par value $1.00 per share, of which 480,000,000 shares may be issued. Holders of our common stock are entitled to one vote per share. We may also issue 5,000,000 shares of preferred stock, but no shares have been issued. The terms and provisions of such shares will be determined by our Board of Directors upon any issuance of preferred shares in accordance with our Certificate of Incorporation.
There were no shares held in treasury as of December 31, 2024, 2023 and 2022.
Our common stock purchases (all of which were open market purchases) and subsequent retirements for the years ended December 31 are summarized below:
in millions, except average cost 2024 2023 2022
Number of shares purchased and retired 0.3 1.0 0.0
Total purchase price 1
$ 68.8 $ 200.0 $ 0.0
Average cost per share $ 254.71 $ 204.52 $ 0.00
1The amount paid to purchase shares in excess of the par value and related excise taxes are recorded in retained earnings.
As of December 31, 2024, 6,817,118 shares may be purchased under the current authorization of our Board of Directors.
Dividends for the years ended December 31 were as follows:
in millions, except per share data 2024 2023 2022
Cash dividends $ 244.4 $ 228.4 $ 212.6
Cash dividends per share $ 1.84 $ 1.72 $ 1.60
Total equity as presented in the consolidated financial statements for the year ended December 31, 2024 includes a noncontrolling interest of $23.9 million, representing the unowned portion of a subsidiary. See Note 1 under the caption "Noncontrolling Interest" for additional discussion.
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NOTE 14: OTHER COMPREHENSIVE INCOME
Comprehensive income comprises two subsets: net earnings and other comprehensive income (OCI). The components of OCI are presented in the accompanying Consolidated Statements of Comprehensive Income and Consolidated Statements of Equity, net of applicable taxes.
Amounts in accumulated other comprehensive income (loss) (AOCI), net of tax, at December 31, are as follows:
in millions 2024 2023 2022
Cash flow hedges $ (17.7) $ (19.4) $ (21.0)
Pension and postretirement plans (109.7) (124.4) (133.7)
Total AOCI $ (127.4) $ (143.8) $ (154.7)
Changes in AOCI, net of tax, for the three years ended December 31, 2024 are as follows:
in millions Cash Flow
Hedges Pension and
Postretirement
Benefit Plans Total
AOCI Balances at December 31, 2021 $ (22.5) $ (130.2) $ (152.7)
Other comprehensive income (loss) before reclassifications 0.0 (6.5) (6.5)
Amounts reclassified from AOCI 1.5 3.0 4.5
Net OCI changes 1.5 (3.5) (2.0)
AOCI Balances at December 31, 2022 $ (21.0) $ (133.7) $ (154.7)
Other comprehensive income (loss) before reclassifications 0.0 4.2 4.2
Amounts reclassified from AOCI 1.6 5.1 6.7
Net OCI changes 1.6 9.3 10.9
AOCI Balances at December 31, 2023 $ (19.4) $ (124.4) $ (143.8)
Other comprehensive income (loss) before reclassifications 0.0 9.7 9.7
Amounts reclassified from AOCI 1.7 5.0 6.7
Net OCI changes 1.7 14.7 16.4
AOCI Balances at December 31, 2024 $ (17.7) $ (109.7) $ (127.4)
Amounts reclassified from AOCI to earnings are as follows:
in millions 2024 2023 2022
Amortization of Accumulated Cash Flow Hedge Losses
Interest expense $ 2.2 $ 2.1 $ 2.0
Benefit from income taxes (0.5) (0.5) (0.5)
Total $ 1.7 $ 1.6 $ 1.5
Amortization of Accumulated Benefit Plan Costs
Other nonoperating expense $ 6.8 $ 6.9 $ 4.0
Benefit from income taxes (1.8) (1.8) (1.0)
Total $ 5.0 $ 5.1 $ 3.0
Total reclassifications from AOCI to earnings $ 6.7 $ 6.7 $ 4.5
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NOTE 15: SEGMENT REPORTING
Our operating segments are based on our internal management reporting structure. Our chief operating decision maker (CODM),
the Chairman and Chief Executive Officer, evaluates our operating results through reportable segment gross profit. This financial metric is used to review operating trends, perform analytical comparisons between periods and monitor budget-to-actual variances on a monthly basis in order to assess performance and allocate resources.
We continually assess our internal management reporting structure and the financial information evaluated by our CODM to determine whether any changes have occurred that would impact segment reporting. During the first quarter of 2024, we reorganized the financial information provided to our CODM. As a result, we now report our calcium operation within our Aggregates reporting segment to align with our new reporting structure. All prior period segment information has been revised to conform to the current presentation. This change in our reporting segments had no impact on previously reported consolidated financial results.
We have three operating (and reportable) segments organized around our principal product lines: Aggregates, Asphalt and Concrete. Management reviews earnings from these reporting segments principally at the gross profit level.
The Aggregates segment produces and sells aggregates (crushed stone, sand and gravel, sand, and other aggregates) and related products and services. During 2024, the Aggregates segment principally served markets in twenty-three states, the U.S. Virgin Islands, Washington D.C., Freeport (Bahamas), British Columbia (Canada), Puerto Cortés (Honduras) and Quintana Roo (Mexico) - see Note 12, NAFTA Arbitration - with a full line of aggregates. Aggregates are used primarily in the construction and maintenance of highways, streets and other public works and in the construction of housing and commercial, industrial and other nonresidential facilities. Customers are served by truck, rail and water distribution networks from our production facilities and sales yards. Due to the high weight-to-price ratio of aggregates, markets generally are local in nature. Quarries located on waterways and rail lines allow us to serve remote markets where local aggregates reserves may not be available.
The Asphalt segment produces and sells asphalt mix in six states (Alabama, Arizona, California, New Mexico, Tennessee and Texas) and provides asphalt construction paving services in three states (Alabama, Tennessee and Texas).
The Concrete segment produces and sells ready-mixed concrete in three states (California, Maryland and Virginia) in addition to the U.S. Virgin Islands and Washington D.C.
Aggregates comprise approximately 95% of asphalt mix by weight and 80% of ready-mixed concrete by weight. Our Asphalt and Concrete segments are primarily supplied with their aggregates requirements from our Aggregates segment. These intersegment sales are made at local market prices for the particular grade and quality of product used in the production of asphalt mix and ready-mixed concrete and are excluded from total revenues. Customers for our Asphalt and Concrete segments are generally served locally at our production facilities or by truck. Because asphalt mix and ready-mixed concrete harden rapidly, delivery is time constrained and generally confined to a radius of approximately 20 to 25 miles from the producing facility.
The vast majority of our activities are domestic. We sell a relatively small amount of construction aggregates outside the United States. Total domestic revenues were $7,401.0 million, $7,769.7 million and $7,263.9 million in 2024, 2023 and 2022, respectively. Nondomestic Aggregates segment revenues were $16.7 million, $12.2 million and $51.3 million in 2024, 2023 and 2022, respectively; there were no significant nondomestic revenues in our Asphalt or Concrete segments. Long-lived assets outside the United States, which consist primarily of property, plant & equipment, were $501.4 million, $524.1 million and $534.2 million in 2024, 2023 and 2022, respectively. Equity method investments of $26.6 million in 2024, $26.6 million in 2023 and $26.5 million in 2022 are included in the identifiable assets for the Aggregates segment and in investments and long-term receivables on the accompanying Consolidated Balance Sheets.
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SEGMENT FINANCIAL DISCLOSURE
in millions 2024 2023 2022
Total Revenues
Aggregates 1
$ 5,949.6 $ 5,918.9 $ 5,280.6
Asphalt 2
1,245.6 1,140.7 990.2
Concrete 3
653.5 1,249.3 1,593.9
Segment sales $ 7,848.7 $ 8,308.9 $ 7,864.7
Aggregates intersegment sales (431.0) (527.0) (549.5)
Total revenues $ 7,417.7 $ 7,781.9 $ 7,315.2
Cost of Revenues
Aggregates
$ (3,701.9) $ (3,655.1) $ (3,320.0)
Asphalt (1,075.5) (991.1) (932.9)
Concrete 3
(640.7) (1,187.2) (1,504.6)
Total $ (5,418.1) $ (5,833.4) $ (5,757.5)
Gross Profit
Aggregates
$ 1,816.7 $ 1,736.8 $ 1,411.1
Asphalt 170.1 149.6 57.3
Concrete 3
12.8 62.1 89.3
Total $ 1,999.6 $ 1,948.5 $ 1,557.7
Reconciliation to Pretax Earnings
Selling, administrative and general expenses $ (531.1) $ (542.8) $ (515.1)
Other operating income (expense), net (104.0) 21.7 (91.2)
Other nonoperating income (expense), net (22.1) (2.7) 5.1
Interest expense, net (170.3) (179.6) (168.4)
Earnings from continuing operations before income taxes $ 1,172.1 $ 1,245.1 $ 788.1
1Includes product sales, as well as freight & delivery costs that we pass along to our customers, and service revenues (see Note 2) related to our aggregates business.
2Includes product sales, as well as service revenues (see Note 2) from our asphalt construction paving business.
3The decreases in the Concrete segment are primarily due to the 2022 divestiture of concrete operations in New Jersey, New York and Pennsylvania and the 2023 divestiture of concrete operations in Texas. See Note 19 for additional information.
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SEGMENT FINANCIAL DISCLOSURE (CONTINUED)
in millions 2024 2023 2022
Depreciation, Depletion, Accretion & Amortization 1
Aggregates
$ 515.7 $ 482.3 $ 441.3
Asphalt 44.1 35.6 35.1
Concrete
45.5 72.8 83.1
Other 26.9 26.3 28.0
Total $ 632.2 $ 617.0 $ 587.5
Capital Expenditures 2
Aggregates $ 588.4 $ 764.9 $ 540.4
Asphalt 36.1 46.9 23.3
Concrete
12.2 15.8 50.4
Corporate 0.7 0.9 30.0
Total $ 637.4 $ 828.5 $ 644.1
Identifiable Assets 3
Aggregates
$ 14,294.6 $ 11,753.2 $ 11,579.0
Asphalt 805.7 613.4 597.6
Concrete
1,065.8 962.3 1,436.2
Total identifiable assets 4
$ 16,166.1 $ 13,328.9 $ 13,612.8
General corporate 337.9 267.6 460.3
Cash and cash equivalents and restricted cash 600.8 949.2 161.5
Total assets $ 17,104.8 $ 14,545.7 $ 14,234.6
1Depreciation, Depletion, Accretion & Amortization (DDA&A) for each segment is included in cost of revenues.
2Capital expenditures include changes in accruals for purchases of property, plant & equipment. Capital expenditures exclude property, plant & equipment obtained by business acquisitions.
3Certain temporarily idled assets are included within a segment's Identifiable Assets, but the associated DDA&A is shown within Other in the DDA&A section above as the related DDA&A is excluded from segment gross profit.
4The increases in total identifiable assets are primarily due to acquisitions completed in 2024 (see Note 19 for additional information).
NOTE 16: SUPPLEMENTAL CASH FLOW INFORMATION
Supplemental information referable to the Consolidated Statements of Cash Flows is summarized below:
in millions 2024 2023 2022
Cash Payments
Interest (exclusive of amount capitalized) $ 182.9 $ 178.7 $ 164.3
Income taxes 279.8 291.7 143.5
Noncash Investing and Financing Activities
Accruals for purchases of property, plant & equipment $ 98.5 $ 64.6 $ 108.7
Note received from sale of business 0.9 0.0 130.0
Recognition of new and revised lease obligations:
Operating lease right-of-use assets 68.8 4.0 44.8
Finance lease right-of-use assets 4.6 2.9 3.8
Consideration payable to seller in business acquisitions 30.9 0.0 65.4
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NOTE 17: ASSET RETIREMENT OBLIGATIONS
Asset retirement obligations (AROs) are legal obligations associated with the retirement of long-lived assets resulting from the acquisition, construction, development and/or normal use of the underlying assets, including legal obligations for land reclamation. Recognition of a liability for an ARO is required in the period in which it is incurred at its estimated fair value. The associated asset retirement costs are capitalized as part of the carrying amount of the underlying asset and depreciated over the estimated useful life of the asset. The liability is accreted through charges to operating expenses. If the ARO is settled for a value other than the carrying amount of the liability, we recognize a gain or loss on settlement.
For the years ended December 31, ARO operating costs related to accretion of the liabilities and depreciation of the assets are as follows:
in millions 2024 2023 2022
Accretion $ 14.7 $ 13.9 $ 14.1
Depreciation 12.5 9.0 9.4
Total ARO operating costs $ 27.2 $ 22.9 $ 23.5
ARO operating costs are reported in cost of revenues. AROs are reported within other noncurrent liabilities in our accompanying Consolidated Balance Sheets.
Reconciliations of the carrying amounts of our AROs for the years ended December 31 are as follows:
in millions 2024 2023
ARO balance at beginning of year $ 324.1 $ 311.3
Liabilities incurred 42.3 0.0
Liabilities settled (19.1) (9.9)
Accretion expense 14.7 13.9
Revisions, net 65.4 8.8
ARO balance at end of year $ 427.4 $ 324.1
ARO liabilities incurred during 2024 relate to those assumed in 2024 acquisitions (see Note 19). ARO revisions during 2024 primarily related to cost adjustments for a number of aggregates properties in California that are being reclaimed for alternative uses post mining.
Part II 106
NOTE 18: GOODWILL AND INTANGIBLE ASSETS
Acquired identifiable intangible assets are classified into three categories: (1) goodwill, (2) intangible assets with finite lives subject to amortization and (3) intangible assets with indefinite lives. Goodwill and intangible assets with indefinite lives are not amortized; rather, they are reviewed for impairment at least annually.
GOODWILL
Goodwill is recognized when the consideration paid for a business exceeds the fair value of the tangible and identifiable intangible assets acquired. Goodwill is allocated to reporting units for purposes of testing goodwill for impairment. We test goodwill for impairment on an annual basis or more frequently if events or circumstances change in a manner that would more likely than not reduce the fair value of a reporting unit below its carrying value. A decrease in the estimated fair value of one or more of our reporting units could result in the recognition of a material, noncash write-down of goodwill.
During the third quarter of 2024, we determined that a triggering event occurred with respect to a reporting unit that includes concrete operations acquired from U.S. Concrete in 2021. We previously disclosed that the estimated fair value of this reporting unit exceeded its carrying value by less than 5%. Based on an interim goodwill impairment test, we determined that the estimated fair value of this reporting unit was less than its carrying value. As a result, we recorded an $86.6 million noncash impairment charge. In addition, during the third quarter of 2022, we recorded an interim goodwill impairment loss of $50.9 million related to the fourth quarter sale of a reporting unit comprised of concrete operations in New Jersey, New York and Pennsylvania. There were no charges for goodwill impairment in the year ended December 31, 2023. Accumulated goodwill impairment losses amount to $390.2 million ($252.7 million in our former Cement segment and $137.5 in our Concrete segment).
We have three reportable segments organized around our principal product lines: Aggregates, Asphalt and Concrete. Changes in the carrying amount of goodwill by reportable segment for the three years ended December 31 are shown below:
in millions Aggregates Asphalt Concrete Total
Goodwill at December 31, 2022 $ 3,330.3 $ 91.6 $ 267.7 $ 3,689.6
Goodwill of acquired businesses 1
(0.1) 0.0 0.0 (0.1)
Goodwill of divested businesses 1
0.0 0.0 (157.8) (157.8)
Goodwill at December 31, 2023 $ 3,330.2 $ 91.6 $ 109.9 $ 3,531.7
Goodwill of acquired businesses 1
343.0 0.0 0.0 343.0
Goodwill impairment 0.0 0.0 (86.6) (86.6)
Goodwill at December 31, 2024 $ 3,673.2 $ 91.6 $ 23.3 $ 3,788.1
1See Note 19 for acquisitions and divestitures.
INTANGIBLE ASSETS
Intangible assets consist of contractual rights in place (primarily permitting and zoning rights), noncompetition agreements, customer relationships and trade names and trademarks. Intangible assets acquired in business combinations are stated at their fair value determined as of the date of acquisition. Intangible assets acquired individually or otherwise obtained outside a business combination consist primarily of permitting, permitting compliance and zoning rights and are stated at their historical cost less accumulated amortization. Costs incurred to renew or extend the life of existing intangible assets are capitalized. These capitalized renewal/extension costs were immaterial for the years presented.
See Note 19 for the details of the intangible assets acquired in business acquisitions. Amortization of finite-lived intangible assets is computed based on the estimated life of the intangible assets. Contractual rights in place associated with aggregates reserves are amortized using the unit-of-sales method based on estimated recoverable units. Other intangible assets are amortized principally by the straight-line method. Intangible assets are reviewed for impairment when events or circumstances indicate that the carrying amount may not be recoverable. There were no material charges for impairment of intangible assets in 2024, 2023 and 2022.
Part II 107
The gross carrying amount and accumulated amortization by major intangible asset class for the years ended December 31 are summarized below:
in millions 2024 2023
Gross Carrying Amount
Contractual rights in place $ 1,899.0 $ 1,592.7
Permitting, permitting compliance and zoning rights 221.3 206.8
Other 1
101.6 90.4
Total gross carrying amount $ 2,221.9 $ 1,889.9
Accumulated Amortization
Contractual rights in place $ (407.0) $ (344.5)
Permitting, permitting compliance and zoning rights (70.4) (59.5)
Other 1
(29.8) (25.2)
Total accumulated amortization $ (507.2) $ (429.2)
Total Intangible Assets Subject to Amortization, net $ 1,714.7 $ 1,460.7
Intangible Assets with Indefinite Lives 0.0 0.0
Total Intangible Assets, net $ 1,714.7 $ 1,460.7
Amortization Expense for the Year $ 83.9 $ 88.1
1Includes noncompetition agreements, patents, customer relationships, tradenames and trademarks.
Estimated amortization expense for the five years subsequent to December 31, 2024 is as follows:
in millions
Estimated Amortization Expense for Five Subsequent Years 1
2025 $ 89.7
2026 88.2
2027 85.3
2028 83.7
2029 81.1
1Includes amortization of quarry development assets (including pre-production stripping costs) reported within other noncurrent assets in our accompanying Consolidated Balance Sheets.
NOTE 19: ACQUISITIONS AND DIVESTITURES
BUSINESS ACQUISITIONS
2024 BUSINESS ACQUISITIONS - During 2024, we acquired the following operations for total consideration of $2,297.1 million ($2,266.2 million cash and $30.9 million noncash):
▪Alabama - aggregates, asphalt mix and construction paving operations
▪California - aggregates, asphalt and ready-mixed concrete operations
▪North Carolina - aggregates operations
▪South Carolina - aggregates operations
▪Texas - asphalt mix and construction paving operations
While none of these acquisitions were individually material, our fourth quarter acquisitions of Wake Stone Corporation (Wake Stone) and Superior Ready Mix, L.P. (Superior) were collectively material. The amounts of total revenues and net earnings attributable to Vulcan from the Wake Stone and Superior acquisitions are included in our Consolidated Statement of Comprehensive Income for the year ended December 31, 2024 as follows:
in millions 2024
Actual Results
Total revenues $ 13.3
Net loss attributable to Vulcan (10.5)
Part II 108
The unaudited pro forma financial information in the table below summarizes the results of operations for Vulcan, Wake Stone and Superior as if they were combined as of January 1, 2023. The pro forma financial information does not reflect any cost savings, operating efficiencies or synergies as a result of these acquisitions. Consistent with the assumed acquisition date of January 1, 2023, the pro forma information excludes transactions between Vulcan, Wake Stone and Superior. The following pro forma information also includes: 1) charges directly attributable to the acquisitions, including acquisition related expenses of $8.5 million; 2) cost of sales related to the sale of acquired inventory marked up to fair value; 3) depreciation, depletion, amortization & accretion expense related to the mark up to fair value of acquired assets; 4) interest expense reflecting the new debt structure; and 5) tax effects of the business combination:
in millions 2024 2023
Supplemental Pro Forma Results
Total revenues $ 7,810.2 $ 8,188.9
Net earnings attributable to Vulcan 818.2 835.9
The unaudited pro forma results above may not be indicative of the results that would have been obtained had these acquisitions occurred at the beginning of 2023, nor does it intend to be a projection of future results.
These acquisitions are reported in our consolidated financial statements as of their respective acquisition dates. The fair value of consideration transferred for the Wake Stone and Superior acquisitions and the preliminary amounts (pending final appraisals of intangible assets and property, plant & equipment as well as working capital adjustments) of assets acquired and liabilities assumed are summarized below:
in millions December 31
Fair Value of Purchase Consideration
Cash $ 2,059.8
Payable to seller 30.9
Total fair value of purchase consideration $ 2,090.7
Identifiable Assets Acquired and Liabilities Assumed
Inventories $ 28.5
Property, plant & equipment 1,918.2
Identifiable intangible assets 275.5
Other assets 60.5
Asset retirement obligations
(41.5)
Deferred tax liabilities (311.2)
Other liabilities (173.7)
Net identifiable assets acquired $ 1,756.3
Goodwill $ 334.4
As a collective result of the Wake Stone and Superior acquisitions, as well as other immaterial acquisitions completed in 2024, we recognized $306.4 million of amortizable intangible assets and $343.0 million of goodwill. The amortizable intangible assets will be amortized against earnings over a weighted-average of approximately 20 years and will be deductible for income tax purposes over 15 years. The $343.0 million of goodwill primarily represents deferred tax liabilities generated from carrying over the seller's tax basis in the assets acquired as well as synergies expected to be realized from acquiring established businesses with assets that have been assembled over a long period of time; the collection of those assets combined with our assets can earn a higher rate of return than either individually. Of the total goodwill recognized, $31.8 million will be deductible for income tax purposes.
2023 BUSINESS ACQUISITIONS - During 2023, we completed no business acquisitions.
2022 BUSINESS ACQUISITIONS - During 2022, including adjustments made in 2023, we purchased the following operations for total consideration of $593.7 million ($528.3 million cash and $65.4 million noncash):
▪California - aggregates, asphalt mix and ready-mixed concrete operations
▪Texas - aggregates operations
▪Virginia - ready-mixed concrete operations
▪Honduras - an aggregates operation serving limited markets along the Gulf Coast
Part II 109
DIVESTITURES AND PENDING DIVESTITURES
In 2024, we sold:
▪Fourth quarter - real estate associated with a former sales yard in Virginia resulting in a pretax gain of $36.7 million
In 2023, we sold:
▪Fourth quarter - concrete operations in Texas resulting in a third quarter impairment charge of $28.3 million and a fourth quarter loss on sale of $13.8 million (the assets were written down to fair value less cost to sell in the third quarter)
▪Fourth quarter - excess real estate in Virginia resulting in a pretax gain of $65.7 million
▪Second quarter - real estate associated with a former recycled concrete facility in Illinois resulting in a pretax gain of $15.2 million
In 2022, we sold:
▪Fourth quarter - concrete operations in New Jersey, New York and Pennsylvania resulting in a third quarter impairment charge of $67.8 million and a fourth quarter loss on sale of $17.4 million (the assets were written down to fair value less cost to sell in the third quarter)
▪Third quarter - excess real estate in Southern California resulting in a pretax gain of $23.5 million
No material assets met the criteria for held for sale at December 31, 2024, 2023 or 2022.
Part II 110

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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ITEM 9
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.

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ITEM 9A. CONTROLS AND PROCEDURES
ITEM 9A
CONTROLS AND PROCEDURES
DISCLOSURE CONTROLS AND PROCEDURES
We maintain a system of controls and procedures designed to ensure that information required to be disclosed in reports we file with the SEC is recorded, processed, summarized and reported within the time periods specified by the SEC's rules and forms. These disclosure controls and procedures (as defined in the Securities Exchange Act of 1934 Rules 13a - 15(e) or 15d - 15(e)), include, without limitation, controls and procedures designed to ensure that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure. Our Chief Executive Officer and Chief Financial Officer, with the participation of other management officials, evaluated the effectiveness of the design and operation of the disclosure controls and procedures as of December 31, 2024. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of December 31, 2024.
We completed the implementation of our quote to invoice system for our aggregates and asphalt operations in the third quarter of 2024. Excluding the acquisitions of Wake Stone and Superior noted below, no other changes were made during the fourth quarter of 2024 to our internal controls over financial reporting, nor have there been other factors that materially affect these controls.
MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
Our management is responsible for establishing and maintaining an adequate system of internal control over financial reporting as required by the Sarbanes-Oxley Act of 2002 and as defined in Securities Exchange Act Rule 13a-15(f).
Under management's supervision, an evaluation of the design and effectiveness of our internal control over financial reporting was conducted based on the framework in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, management concluded that our internal control over financial reporting was effective as of December 31, 2024.
We completed our acquisitions of Wake Stone on November 8, 2024 and Superior on December 20, 2024 and have not yet included either company in management's assessment of the effectiveness of our internal control over financial reporting. We are currently integrating both companies into our operations and internal control processes. Accordingly, pursuant to the SEC's general guidance that an assessment of a recently acquired business may be omitted from the scope of an assessment for one year following the acquisition, the scope of management's assessment of the effectiveness of our disclosure controls and procedures does not include Wake Stone or Superior. Wake Stone and Superior combined constituted approximately 13.7% of our total assets as of December 31, 2024 and approximately 0.2% of our total revenues for the year ended December 31, 2024.
Deloitte & Touche LLP, an independent registered public accounting firm, as auditors of our consolidated financial statements, has issued an attestation report on the effectiveness of our internal control over financial reporting as of December 31, 2024. Deloitte & Touche LLP's report, which expresses an unqualified opinion on the effectiveness of our internal control over financial reporting, follows this report.
INHERENT LIMITATIONS ON EFFECTIVENESS OF CONTROLS
Management does not expect that our disclosure controls and procedures or our internal controls over financial reporting will prevent or detect all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. The design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Further, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, have been detected.
Part II 111
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM - INTERNAL CONTROL OVER FINANCIAL REPORTING
To the shareholders and the Board of Directors of Vulcan Materials Company:
Opinion on Internal Control over Financial Reporting
We have audited the internal control over financial reporting of Vulcan Materials Company and subsidiaries (the “Company”) as of December 31, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by COSO.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2024 of the Company and our report dated February 20, 2025, expressed an unqualified opinion on those financial statements.
As described in Item 9A, Disclosure Controls and Procedures, management excluded from its assessment the internal control over financial reporting at Wake Stone Corporation (“Wake Stone”) and Superior Ready Mix Concrete, L.P. (“Superior”), which were acquired by Vulcan Materials Company on November 8, 2024 and December 20, 2024, respectively, and whose combined financial statements constitute 13.7% of total assets as of December 31, 2024, and approximately 0.2% of total revenues for the year ended December 31, 2024. Accordingly, our audit did not include the internal control over financial reporting at Superior and Wake Stone.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control over Financial Reporting
A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of the effectiveness to future periods are subject to the risk that the controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ DELOITTE & TOUCHE LLP
Birmingham, Alabama
February 20, 2025
Part II 112

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ITEM 9B. OTHER INFORMATION
ITEM 9B
OTHER INFORMATION
SECURITIES TRADING PLANS OF SECTION 16 OFFICERS AND DIRECTORS
During the three months ended December 31, 2024, none of our Section 16 officers or directors adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement as defined in Item 408(a) of Regulation S-K.

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ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
ITEM 10
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
On or about March 24, 2025, we expect to file a definitive proxy statement with the Securities and Exchange Commission pursuant to Regulation 14A (our “2025 Proxy Statement”). The information under the headings “Proposal 1 - Election of Directors,” “Corporate Governance - Policies,” “Corporate Governance - Director Nomination Process,” “Corporate Governance - Committees of the Board of Directors” and “Delinquent Section 16(a) Reports” (to the extent reported therein) included in our 2025 Proxy Statement is incorporated herein by reference. See also the information about our executive officers and governance policies set forth above in Part I of this report.

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ITEM 11. EXECUTIVE COMPENSATION
ITEM 11
EXECUTIVE COMPENSATION
The information under the headings “Compensation Discussion and Analysis,” “Director Compensation,” “Executive Compensation,” “Corporate Governance - Compensation Committee Interlocks and Insider Participation,” and “Compensation Committee Report” included in our 2025 Proxy Statement is incorporated herein by reference.

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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
ITEM 12
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS
The information under the headings “Security Ownership of Certain Beneficial Owners and Management” and “Equity Compensation Plans” included in our 2025 Proxy Statement is incorporated herein by reference.

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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
ITEM 13
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE
The information under the headings “Corporate Governance - Director Independence” and “Corporate Governance - Transactions with Related Persons” included in our 2025 Proxy Statement is incorporated herein by reference.

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ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
ITEM 14
PRINCIPAL ACCOUNTANT FEES AND SERVICES
The information under the heading “Independent Registered Public Accounting Firm” included in our 2025 Proxy Statement is incorporated herein by reference.
Part III 114
PART IV

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ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
ITEM 15
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) (1) Financial statements
The following financial statements are included herein on the pages shown below:
Page in Report
Report of Independent Registered Public Accounting Firm (PCAOB ID 34)
62 - 63
Consolidated Statements of Comprehensive Income
Consolidated Balance Sheets
Consolidated Statements of Cash Flows
Consolidated Statements of Equity
Notes to Consolidated Financial Statements
68 - 110
(a) (2) Financial statement schedules
Financial statement schedules are omitted because of the absence of conditions under which they are required or because the required information is provided in the financial statements or notes thereto.
Financial statements (and summarized financial information) of 50% or less owned entities accounted for by the equity method have been omitted because they do not, considered individually or in the aggregate, constitute a significant subsidiary.
(a) (3) Exhibits
Exhibit 3(a)
Certificate of Incorporation (Restated 2007) of the Company (formerly known as Virginia Holdco, Inc.), filed as Exhibit 3.1 to the Company’s Current Report on Form 8-K on November 16, 2007 1
Exhibit 3(b) Amended and Restated By-Laws of the Company (as amended through December 9, 2022) filed as Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on December 12, 2022 1
Exhibit 4(a) Senior Debt Indenture, dated as of December 11, 2007, between the Company and Wilmington Trust Company, as Trustee, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K on December 11, 2007 1
Exhibit 4(b) First Supplemental Indenture, dated as of December 11, 2007, between Vulcan Materials Company and Wilmington Trust Company, as Trustee, to that certain Senior Debt Indenture, dated as of December 11, 2007, between the Company and Wilmington Trust Company, as Trustee, filed as Exhibit 4.2 to the Company’s Current Report on Form 8-K on December 11, 2007 1
Exhibit 4(c)
Fifth Supplemental Indenture, dated March 30, 2015, between the Company and Regions Bank, as Trustee, filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed on March 30, 2015 1
Exhibit 4(d)
Sixth Supplemental Indenture, dated March 14, 2017, between the Company and Regions Bank, as Trustee, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on March 14, 2017 1
Exhibit 4(e)
Seventh Supplemental Indenture, dated as of June 15, 2017, between Vulcan Materials Company and Regions Bank, as Trustee, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on June 15, 2017 1
Exhibit 4(f)
Ninth Supplemental Indenture, dated as of May 18, 2020, between Vulcan Materials Company and Regions Bank as Trustee, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on May 18, 2020 1
Exhibit 4(g)
Tenth Supplemental Indenture, dated as of March 3, 2023, between Vulcan Materials Company and Regions Bank as Trustee, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on March 3, 2023 1
Exhibit 4(h)
Eleventh Supplemental Indenture, dated as of November 20, 2024, between Vulcan Materials Company and Regions Bank as Trustee, filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed on November 20, 2024
Exhibit 4(i)
Indenture, dated as of February 23, 2018, between Vulcan Materials Company and Regions Bank, as Trustee, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on February 26, 2018 1
Part IV 115
Exhibit 4(j)
Description of Securities, filed as Exhibit 4(o) to the Company’s Annual Report on Form 10-K filed on February 24, 2023 1
Exhibit 10(a) Credit Agreement, dated as of September 10, 2020, among Vulcan Materials Company, Truist Bank, as Administrative Agent, and the Lenders and other parties named therein, filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on September 11, 2020 1
Exhibit 10(b) First Amendment to Credit Agreement, dated June 30, 2021, among Vulcan Materials Company, Truist Bank, as Administrative Agent, and the Lenders and other parties named therein, filed as Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q filed on August 5, 2021 1
Exhibit 10(c) Second Amendment to Credit Agreement, dated August 16, 2021, by and between Vulcan Materials Company and Truist Bank, as Administrative Agent, filed as Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q filed on November 5, 2021 1
Exhibit 10(d) Third Amendment to Credit Agreement, dated March 18, 2022, by and between Vulcan Materials Company and Truist Bank, as Administrative Agent, filed as Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q filed on May 5, 2022 1
Exhibit 10(e)
Fourth Amendment to Credit Agreement, dated as of August 8, 2022, among Vulcan Materials Company, Truist Bank, as Administrative Agent, and the Lenders and other parties named therein, filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on August 9, 2022 1
Exhibit 10(f)
Fifth Amendment to Credit Agreement, dated as of November 4, 2024, among Vulcan Materials Company, Truist Bank, as Administrative Agent, and the Revolving Credit Lenders and other parties named therein, filed as Exhibit 10.2 to the Company's Current Report on Form 8-K filed on November 4, 2024
Exhibit 10(g)
Unfunded Supplemental Benefit Plan for Salaried Employees, as amended, filed as Exhibit 10.4 to the Company’s Current Report on Form 8-K filed on December 17, 2008 1,2
Exhibit 10(h)
Amendment No. 1 to the Unfunded Supplemental Benefit Plan for Salaried Employees filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K on January 7, 2014 1,2
Exhibit 10(i)
Deferred Compensation Plan for Directors Who Are Not Employees of the Company, as amended, filed as Exhibit 10.5 to the Company’s Current Report on Form 8-K filed on December 17, 2008 1,2
Exhibit 10(j)
Executive Deferred Compensation Plan, as amended, filed as Exhibit 10.1 to the Company's Current Report on Form 8-K filed on December 17, 2008 1,2
Exhibit 10(k)
Form of Change of Control Employment Agreement dated January 1, 2016, filed as Exhibit 10.1 to the Company's Current Report on Form 8-K filed on January 7, 2016 1,2
Exhibit 10(l)
Vulcan Materials Company Change of Control Severance Plan for Senior Officers, effective January 1, 2016, filed as Exhibit 10(m) to the Company's Annual Report on Form 10-K filed on February 25, 2016 1,2
Exhibit 10(m)
Executive Incentive Plan of the Company, as amended, filed as Exhibit 10.2 to the Company's Current Report on Form 8-K filed on December 17, 2008 1,2
Exhibit 10(n)
Vulcan Materials Company 2016 Omnibus Long-Term Incentive Plan, filed as Exhibit 99 to the Company’s Registration Statement on Form S-8 (File No. 333-211349) filed on May 13, 2016 1,2
Exhibit 10(o)
Form of Non-Employee Director Deferred Stock Unit Agreement under the Vulcan Materials Company 2016 Omnibus Long-Term Incentive Plan, filed as Exhibit 10(y) to the Company’s Quarterly Report on Form 10-Q filed on August 3, 2016 1,2
Exhibit 10(p)
Form of Stock-Only Stock Appreciation Rights Award Agreement under the Vulcan Materials Company 2016 Omnibus Long-Term Incentive Plan, filed as Exhibit 10(z) to the Company’s Quarterly Report on Form 10-Q filed on August 3, 2016 1,2
Exhibit 10(q)
Form of Restricted Stock Unit Award Agreement under the Vulcan Materials Company 2016 Omnibus Long-Term Incentive Plan, filed as Exhibit 10(aa) to the Company’s Quarterly Report on Form 10-Q filed on August 3, 2016 1,2
Exhibit 10(r)
Form of Performance Share Unit Award Agreement under the Vulcan Materials Company 2016 Omnibus Long-Term Incentive Plan, filed as Exhibit 10(bb) to the Company’s Quarterly Report on Form 10-Q filed on August 3, 2016 1,2
Part IV 116
Exhibit 10(s)
Form of Performance Share Unit Award Agreement (2019) under the Vulcan Materials Company 2016 Omnibus Long-Term Incentive Plan, filed as Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed on May 3, 2019 1,2
Exhibit 10(t)
Form of Performance Share Unit Award Agreement (2020) under the Vulcan Materials Company 2016 Omnibus Long-Term Incentive Plan, filed as Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed on May 6, 2020 1,2
Exhibit 10(u)
Form of Stock-Only Appreciation Rights Award Agreement (2020) under the Vulcan Materials Company 2016 Omnibus Long-Term Incentive Plan, filed as Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q filed on May 6, 2020 1,2
Exhibit 10(v)
Form of Restricted Stock Unit Award Agreement (2020) under the Vulcan Materials Company 2016 Omnibus Long-Term Incentive Plan, filed as Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q filed on May 6, 2020 1,2
Exhibit 10(w)
Form of Non-Employee Director Restricted Stock Unit Award Agreement under the Vulcan Materials Company 2016 Omnibus Long-Term Incentive Plan filed as Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q filed on August 5, 2020 1,2
Exhibit 19 Insider Trading Policy
Exhibit 21 List of the Company's material subsidiaries as of December 31, 2024
Exhibit 23 Consent of Deloitte & Touche LLP, Independent Registered Public Accounting Firm
Exhibit 24 Powers of Attorney
Exhibit 31(a) Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Exhibit 31(b) Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Exhibit 32(a) Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
Exhibit 32(b) Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
Exhibit 95 MSHA Citations and Litigation
Exhibit 97 Clawback Policy, filed as Exhibit 97 to the Company's Annual Report on Form 10-K filed on February 22, 2024 1
Exhibit 101 The following financial information from this Annual Report on Form 10-K for the year ended December 31, 2024 are formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) the Consolidated Statements of Comprehensive Income, (ii) the Consolidated Balance Sheets, (iii) the Consolidated Statements of Cash Flows, (iv) the Consolidated Statements of Equity and (v) the Notes to Consolidated Financial Statements
Exhibit 104 Cover Page Interactive Data File - the cover page from this Annual Report on Form 10-K for the year ended December 31, 2024 is formatted in iXBRL (contained in Exhibit 101)
1Incorporated by reference.
2Management contract or compensatory plan.
Our SEC file number for documents filed with the SEC pursuant to the Securities Exchange Act of 1934, as amended, is 001-33841.