PART I - FINANCIAL INFORMATION [Financial Statements (Unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) The unaudited Q1 2025 financial statements reflect increased assets, significant net income growth, and positive operating cash flow [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) Total assets increased to $1,056.0 million as of March 31, 2025, primarily due to higher inventories and receivables Consolidated Balance Sheet Highlights (in millions) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Current Assets** | $737.2 | $722.8 | | Inventories | $434.9 | $422.7 | | **Total Assets** | **$1,056.0** | **$1,043.6** | | **Total Current Liabilities** | $277.0 | $271.7 | | Long-term debt | $96.0 | $105.0 | | **Total Liabilities** | **$402.9** | **$406.0** | | **Total Equity** | **$653.1** | **$637.6** | [Consolidated Statements of Operations](index=5&type=section&id=Consolidated%20Statements%20of%20Operations) Q1 2025 saw a 6.5% increase in net sales to $329.4 million, with gross profit up 20.2% and diluted EPS rising to $0.62 Q1 2025 vs. Q1 2024 Performance (in millions, except per share data) | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Net sales | $329.4 | $309.2 | +6.5% | | Gross profit | $92.4 | $76.9 | +20.2% | | Income from operations | $20.5 | $6.3 | +225.4% | | Net income attributable to controlling interest | $14.3 | $3.4 | +320.6% | | Diluted EPS | $0.62 | $0.15 | +313.3% | [Consolidated Statements of Comprehensive Income (Loss)](index=6&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) Comprehensive income attributable to controlling interest was $17.3 million for Q1 2025, a significant turnaround from a prior-year loss Comprehensive Income (Loss) (in millions) | Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net income | $14.3 | $3.3 | | Foreign currency translation adjustments | $3.1 | $(4.4) | | **Comprehensive income (loss) attributable to controlling interest** | **$17.3** | **$(1.0)** | [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash provided by operating activities was $20.5 million in Q1 2025, a substantial improvement from a prior-year use of cash Cash Flow Summary (in millions) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $20.5 | $(47.0) | | Net cash used in investing activities | $(4.2) | $(5.9) | | Net cash (used in) provided by financing activities | $(15.0) | $48.4 | | **Increase (decrease) in cash** | **$1.8** | **$(5.1)** | [Notes to Unaudited Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Unaudited%20Consolidated%20Financial%20Statements) Notes detail segment operations, inventory increases, ERP costs, and the planned **$245.0 million** TerraSource acquisition - The company operates in two reportable segments: **Infrastructure Solutions** and **Materials Solutions**, primarily serving the road building, construction, and mining industries[26](index=26&type=chunk)[27](index=27&type=chunk) - Total inventories increased to **$434.9 million** as of March 31, 2025, up from **$422.7 million** at the end of 2024, with work-in-process showing the largest increase[39](index=39&type=chunk) - The company's strategic ERP implementation has resulted in net capitalized costs of **$31.0 million** as of March 31, 2025[68](index=68&type=chunk)[69](index=69&type=chunk) - On April 28, 2025, the company agreed to acquire **TerraSource Holdings, LLC** for **$245.0 million** in cash, with the transaction expected to close in Q3 2025[74](index=74&type=chunk) - To fund the **TerraSource** acquisition and refinance existing debt, the company has secured a commitment for a new **$500.0 million** senior secured credit facility[75](index=75&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=21&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Q1 2025 net sales increased 6.5% to **$329.4 million**, driven by pricing and equipment sales, while backlog decreased 28.1% Q1 2025 Financial Highlights vs. Q1 2024 | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Net sales | $329.4M | $309.2M | +6.5% | | Gross profit | $92.4M | $76.9M | +20.2% | | Income from operations | $20.5M | $6.3M | +225.4% | | Diluted EPS | $0.62 | $0.15 | +313.3% | | Backlog (as of Mar 31) | $402.6M | $559.8M | -28.1% | - The ongoing multi-year ERP implementation is expected to cost between **$180 to $200 million**, with approximately **$140 million** incurred through Q1 2025[80](index=80&type=chunk) - The increase in gross profit was primarily driven by net favorable pricing, favorable volume/mix (**$16.0 million**), and manufacturing efficiencies (**$3.7 million**)[90](index=90&type=chunk) [Results of Operations](index=22&type=section&id=Results%20of%20Operations) Net sales for Q1 2025 increased 6.5% to **$329.4 million**, with gross profit margin expanding to **28.1%** due to favorable pricing - Domestic sales increased **12.6%** to **$273.8 million**, while international sales decreased **15.8%** to **$55.6 million**[88](index=88&type=chunk)[89](index=89&type=chunk) - The decrease in backlog is attributed to shorter production lead times allowing customers to order closer to delivery dates and variability in dealer ordering patterns due to inflation and interest rates[96](index=96&type=chunk) Backlog by Segment (in millions) | Segment | March 31, 2025 | March 31, 2024 | % Change | | :--- | :--- | :--- | :--- | | Infrastructure Solutions | $276.4 | $372.7 | (25.8)% | | Materials Solutions | $126.2 | $187.1 | (32.5)% | | **Total Backlog** | **$402.6** | **$559.8** | **(28.1)%** | [Segment Analysis](index=23&type=section&id=Segment%20Analysis) **Infrastructure Solutions** sales rose **16.7%** with strong EBITDA growth, while **Materials Solutions** sales declined **12.7%** Net Sales by Segment (in millions) | Segment | Q1 2025 | Q1 2024 | % Change | | :--- | :--- | :--- | :--- | | Infrastructure Solutions | $236.0 | $202.2 | +16.7% | | Materials Solutions | $93.4 | $107.0 | (12.7)% | Segment Operating Adjusted EBITDA (in millions) | Segment | Q1 2025 | Q1 2024 | % Change | | :--- | :--- | :--- | :--- | | Infrastructure Solutions | $42.9 | $25.6 | +67.6% | | Materials Solutions | $5.2 | $5.3 | (1.9)% | - **Infrastructure Solutions'** growth was driven by net favorable pricing and volume, leading to a **$19.0 million** increase in gross profit and **$4.9 million** in manufacturing efficiencies[106](index=106&type=chunk) - **Materials Solutions'** performance was impacted by unfavorable volume and mix, resulting in a **$3.0 million** lower gross profit[107](index=107&type=chunk)[108](index=108&type=chunk) [Liquidity and Capital Resources](index=25&type=section&id=Liquidity%20and%20Capital%20Resources) Total liquidity was **$238.9 million** as of March 31, 2025, with 2025 capital expenditures projected at **$35.0 million** to **$45.0 million** - Total liquidity as of March 31, 2025 was **$238.9 million**, consisting of **$90.1 million** in cash and **$148.8 million** in borrowing availability[110](index=110&type=chunk) - The company was in compliance with all financial covenants for its Credit Facilities as of March 31, 2025[112](index=112&type=chunk) - Estimated capital expenditures for the full year 2025 are projected to be between **$35.0 million** and **$45.0 million**[116](index=116&type=chunk) [Cash Flows](index=26&type=section&id=Cash%20Flows) Operating cash flow significantly improved to **$20.5 million** in Q1 2025, driven by higher net income and better working capital management - The improvement in operating cash flow was driven by a **$52.5 million** favorable change in operating assets and liabilities and a **$15.0 million** increase in cash inflows from net income adjusted for non-cash items[118](index=118&type=chunk) - Financing activities used **$15.0 million** in Q1 2025, a reversal from providing **$48.4 million** in Q1 2024, mainly due to net repayments on credit facilities in 2025 versus net borrowings in 2024[120](index=120&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=27&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Market risk exposures have not materially changed since the 2024 Annual Report on Form 10-K filing - Market risk exposures have not materially changed since the Annual Report on Form 10-K for the year ended December 31, 2024 was filed[125](index=125&type=chunk) [Controls and Procedures](index=27&type=section&id=Item%204.%20Controls%20and%20Procedures) Disclosure controls were effective as of March 31, 2025, with ongoing ERP implementation expected to change internal controls - The CEO and CFO concluded that as of March 31, 2025, the Company's disclosure controls and procedures were effective[126](index=126&type=chunk) - The company is undergoing a significant multi-year global ERP implementation, which is expected to result in changes to internal control over financial reporting[127](index=127&type=chunk)[128](index=128&type=chunk) PART II - OTHER INFORMATION [Legal Proceedings](index=28&type=section&id=Item%201.%20Legal%20Proceedings) Management believes current legal proceedings will not materially affect the company's financial position or results - Management believes the ultimate outcome of current legal proceedings will not materially affect the company's business, financial position, cash flows, or results of operations[131](index=131&type=chunk) [Risk Factors](index=28&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors, except for new risks associated with the pending **TerraSource** acquisition and related indebtedness - A new risk factor has been added concerning the acquisition of **TerraSource Holdings, LLC**[134](index=134&type=chunk) - Risks related to the **TerraSource acquisition** include failure to complete the deal, integration challenges, failure to realize anticipated benefits, and the impact of incurring significant new debt[135](index=135&type=chunk)[136](index=136&type=chunk)[137](index=137&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=28&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) There were no unregistered sales of equity securities during the period - None[137](index=137&type=chunk) [Defaults Upon Senior Securities](index=28&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) There were no defaults upon senior securities during the period - None[138](index=138&type=chunk) [Mine Safety Disclosures](index=29&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) No mine safety disclosures were reported for the period - None[140](index=140&type=chunk) [Other Information](index=29&type=section&id=Item%205.%20Other%20Information) No officers or directors adopted or terminated **Rule 10b5-1** or non-**Rule 10b5-1** trading arrangements during the quarter - No officers or directors adopted or terminated a **Rule 10b5-1** or non-**Rule 10b5-1** trading arrangement during the quarter[141](index=141&type=chunk) [Exhibits](index=29&type=section&id=Item%206.%20Exhibits) The report includes **CEO** and **CFO certifications** pursuant to Sarbanes-Oxley Act and **XBRL documents** - Exhibits filed include **CEO/CFO certifications** (31.1, 31.2, 32.1, 32.2) and **XBRL documents** (101 series)[142](index=142&type=chunk)

Financial Data and Key Metrics Changes - Adjusted EBITDA for Q1 was $35.2 million, an increase of $16.3 million or 86.2% compared to Q1 2024 [6][19] - Adjusted EBITDA margin improved to 10.7%, up 460 basis points year-over-year [7][19] - Adjusted earnings per share were reported at $0.88, significantly higher than $0.34 in Q1 2024 [7][20] - Free cash flow for the quarter was $16.6 million, representing 116% of net income [8][23] Business Line Data and Key Metrics Changes - In the Infrastructure Solutions segment, net sales were driven by strong capital equipment and aftermarket parts sales, despite a slight decline in backlog by 4.1% [7][21] - The Materials Solutions segment faced challenges due to high interest rates and dealer inventory destocking, but aftermarket parts sales remained stable [7][22] - Backlog in the Materials Solutions segment grew by $12.1 million or 10.6% due to increased order activity [17] Market Data and Key Metrics Changes - The overall backlog declined slightly but remained healthy, supported by growth in implied orders [16] - Infrastructure Solutions segment backlog was influenced by strong invoicing for asphalt and concrete plants [16] - Implied orders rose on a quarter-over-quarter basis, with a book-to-bill ratio of 113% for Q1 [18] Company Strategy and Development Direction - The company announced a definitive agreement to acquire TerraSource, a market leader in materials processing equipment, which is expected to enhance the Material Solutions segment [5][25] - The acquisition is anticipated to provide significant synergies and expand the product portfolio, with a focus on aftermarket parts [26][30] - The company is taking proactive measures to mitigate risks associated with tariffs, including price adjustments and supply chain management [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding customer sentiment and infrastructure investment needs, highlighting the importance of ongoing infrastructure improvements [9][12] - The company is maintaining its expectations for adjusted EBITDA for the full year 2025 in the range of $105 million to $125 million, excluding tariff impacts [8][20] - Management noted that while there is uncertainty regarding tariffs, proactive measures have been implemented to manage costs and protect margins [40][41] Other Important Information - The company highlighted the need for continued infrastructure investment, as indicated by the American Society of Civil Engineers' report card [9][10] - The acquisition of TerraSource is expected to close in early Q3 2025, subject to regulatory considerations [33] Q&A Session Summary Question: Why not raise guidance despite strong performance? - Management indicated that while there is upside potential, uncertainty around tariffs and customer behavior influenced the decision not to raise guidance at this time [39][40] Question: How is the company positioned regarding current tariffs? - Management stated that they have been proactive in managing the impact of tariffs and have implemented price increases to mitigate costs [42][43] Question: How has TerraSource performed compared to legacy Material Solutions? - Management noted that TerraSource has a smaller exposure to mobile markets and a significant portion of its business comes from aftermarket parts, which contributes to higher gross margins [46][48] Question: What is the expected impact of tariffs on costs? - Management estimated a potential impact of 4% to 10% on costs if no actions are taken, but emphasized their proactive measures to manage this risk [54][58] Question: Will the acquisition of TerraSource be accretive to EBITDA? - Management confirmed that the acquisition is expected to be accretive from day one, with significant synergy opportunities anticipated [33][34]

First Quarter 2025 Earnings April 29, 2025 B U I L T T O C O N N E C T Safe Harbor Certain statements contained in this presentation contain forward-looking statements within the meaning of the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. Such statements relate to, among other things, income, earnings, cash flows, changes in operations, operating improvements, businesses in which we operate and the United State ...

Financial Data and Key Metrics Changes - Adjusted EBITDA for Q1 was $35.2 million, an increase of $16.3 million or 86.2% compared to Q1 2024 [6][19] - Adjusted EBITDA margin improved to 10.7%, up 460 basis points year-over-year [7][19] - Adjusted earnings per share were reported at $0.88, significantly higher than $0.34 in Q1 2024 [7][20] - Free cash flow for the quarter was $16.6 million, representing 116% of net income [8][23] Business Line Data and Key Metrics Changes - Infrastructure Solutions segment saw strong net sales driven by capital equipment and aftermarket parts, despite some softness in mobile paving and forestry units [7][21] - Material Solutions segment faced challenges due to high interest rates and dealer inventory destocking, but aftermarket parts sales remained stable [7][22] - Backlog in Material Solutions grew by $12.1 million or 10.6% due to increased order activity [16] Market Data and Key Metrics Changes - The backlog of $402.6 million moderated sequentially by 4.1%, but implied orders showed improvement [6][7] - Infrastructure investment remains critical, with a report indicating that 39% of America's public roadways are in poor or mediocre condition [9][10] Company Strategy and Development Direction - The company announced a definitive agreement to acquire TerraSource, a market leader in materials processing equipment, which is expected to enhance the Material Solutions segment [5][25] - The acquisition is anticipated to provide significant synergies and expand the product portfolio, with a focus on aftermarket parts [26][30] - The company is actively managing risks associated with tariffs and is taking proactive measures to protect margins [13][35] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding customer sentiment and the construction market, despite uncertainties related to tariffs [34] - The company is maintaining its adjusted EBITDA expectations for 2025 in the range of $105 million to $125 million, excluding tariff impacts [8][19] - Management highlighted the importance of infrastructure investment and the long-term stable demand for their equipment and services [11][12] Other Important Information - The company ended the quarter with cash and cash equivalents of $90.1 million and total available liquidity of $238.9 million [23] - The acquisition of TerraSource is expected to close in early Q3 2025, subject to regulatory considerations [33] Q&A Session Summary Question: Why not raise guidance despite strong performance? - Management indicated uncertainty around tariffs and customer behavior as reasons for not raising guidance at this time [39][40] Question: How is the company positioned regarding current tariffs? - Management noted proactive measures taken to mitigate tariff impacts and emphasized their strong position as a U.S. manufacturer [41][44] Question: How has TerraSource performed compared to legacy Material Solutions? - Management highlighted that TerraSource has a smaller exposure to mobile markets and a significant portion of its business comes from aftermarket parts, which contributes to higher gross margins [45][46] Question: Clarification on guidance excluding tariff impacts? - Management confirmed that the guidance provided excludes any impact from tariffs [50][52] Question: What is the potential impact of tariffs on costs? - Management estimated a potential impact of 4% to 10% on COGS if no actions are taken, but they are actively managing this risk [52][56] Question: Can the backlog be repriced? - Management stated that they cannot reprice the backlog but feel well covered compared to previous situations [57] Question: What is the trailing EBITDA for TerraSource? - Management refrained from providing historical EBITDA numbers for TerraSource at this stage [63]

[Astec First Quarter 2025 Results and TerraSource Acquisition](index=1&type=section&id=Astec%20First%20Quarter%202025%20Results%20and%20TerraSource%20Acquisition) [First Quarter 2025 Financial Highlights](index=1&type=section&id=First%20Quarter%202025%20Financial%20Highlights) Astec reported strong Q1 2025 results, with net sales increasing **6.5%** and net income surging **320.6%** Q1 2025 Key Financial Metrics (GAAP vs. Adjusted) | Metric (in millions, except per share) | 1Q 2025 (GAAP) | 1Q 2024 (GAAP) | % Change | 1Q 2025 (Adjusted) | 1Q 2024 (Adjusted) | % Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Net Sales** | $329.4 | $309.2 | 6.5% | - | - | - | | **Income from Operations** | $20.5 | $6.3 | 225.4% | $28.3 | $12.0 | 135.8% | | **Net Income** | $14.3 | $3.4 | 320.6% | $20.3 | $7.8 | 160.3% | | **Diluted EPS** | $0.62 | $0.15 | 313.3% | $0.88 | $0.34 | 158.8% | | **EBITDA** | $27.5 | $13.4 | 105.2% | $35.2 | $18.9 | 86.2% | | **Backlog** | $402.6 | $559.8 | (28.1)% | - | - | - | - CEO Jaco van der Merwe attributed the strong quarter to operational execution, delivering increases in **net sales**, **EBITDA**, **net income**, and **EPS**[3](index=3&type=chunk) - The company reiterated its full-year adjusted EBITDA guidance range of **$105 million** to **$125 million**, excluding the pending TerraSource acquisition[3](index=3&type=chunk) [Acquisition of TerraSource Holdings, LLC](index=1&type=section&id=Acquisition%20of%20TerraSource%20Holdings%2C%20LLC) Astec will acquire TerraSource Holdings for **$245 million** in cash, expecting accretion, margin expansion, and **$10 million** in synergies - Astec will acquire TerraSource for **$245.0 million** in cash, financed through existing cash and new committed financing[9](index=9&type=chunk) - The transaction is expected to close in the early third quarter of 2025, subject to regulatory approvals[9](index=9&type=chunk) - Strategic benefits of the acquisition include: - Increases aftermarket revenue, with TerraSource's 2024 aftermarket sales comprising **~60%** of total revenue and **80%** of gross profit - Adds scale and expands global market presence - Expected to be accretive to gross profit margins, adjusted EBITDA margins, and EPS - Enables approximately **$10 million** in run-rate cost synergies, primarily from procurement savings[14](index=14&type=chunk) [Segment Performance](index=1&type=section&id=Segment%20Performance) Infrastructure Solutions net sales grew **16.7%** while Materials Solutions declined **12.7%**, reflecting varied market demand Q1 2025 Segment Performance vs. Q1 2024 | Segment | Net Sales (Q1 2025, in millions) | % Change YoY | Segment Operating Adjusted EBITDA (Q1 2025, in millions) | % Change YoY | Segment Operating Adjusted EBITDA Margin (Q1 2025) | | :--- | :--- | :--- | :--- | :--- | :--- | | **Infrastructure Solutions** | $236.0M | 16.7% | $42.9M | 67.6% | 18.2% | | **Materials Solutions** | $93.4M | (12.7)% | $5.2M | (1.9)% | 5.6% | [Infrastructure Solutions](index=2&type=section&id=Infrastructure%20Solutions) Infrastructure Solutions net sales increased **16.7%** to **$236 million**, with Adjusted EBITDA surging **67.6%** - Net sales increased **16.7%** to **$236.0 million** due to strong demand for asphalt and concrete plants, despite some softness in mobile paving and forestry[13](index=13&type=chunk) - Segment Operating Adjusted EBITDA increased **67.6%** to **$42.9 million**, and the margin improved by **550 basis points** to **18.2%**[13](index=13&type=chunk)[25](index=25&type=chunk) [Materials Solutions](index=2&type=section&id=Materials%20Solutions) Materials Solutions net sales decreased **12.7%** to **$93.4 million** due to domestic equipment sales declines, with stable EBITDA - Net sales decreased **12.7%** to **$93.4 million**, mainly due to lower domestic equipment sales linked to financing constraints for contractors and dealers[13](index=13&type=chunk) - Segment Operating Adjusted EBITDA decreased by **1.9%** to **$5.2 million**, while the margin improved by **60 basis points** to **5.6%**[13](index=13&type=chunk)[25](index=25&type=chunk) [Liquidity and Cash Flow](index=2&type=section&id=Liquidity%20and%20Cash%20Flow) Astec reported **$238.9 million** in liquidity, generating **$20.5 million** in operating cash flow and **$16.6 million** in free cash flow - Total liquidity stood at **$238.9 million**, comprising **$90.1 million** in cash and **$148.8 million** available under its revolving credit facility[13](index=13&type=chunk) Q1 2025 Cash Flow Summary (in millions) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Operating Cash Flow** | $20.5 | $(47.0) | | **Capital Expenditures** | $(3.9) | $(5.8) | | **Free Cash Flow** | $16.6 | $(52.8) | - The company paid a dividend of **$0.13 per share** during the quarter[13](index=13&type=chunk) [Consolidated Financial Statements](index=5&type=section&id=Consolidated%20Financial%20Statements) Astec's Q1 2025 consolidated statements show net sales of **$329.4 million** and net income of **$14.3 million** [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Q1 2025 net sales reached **$329.4 million**, with gross profit at **$92.4 million** and net income at **$14.3 million** Q1 2025 Statement of Operations (in millions) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Net sales** | $329.4 | $309.2 | | **Gross profit** | $92.4 | $76.9 | | **Income from operations** | $20.5 | $6.3 | | **Net income attributable to controlling interest** | $14.3 | $3.4 | | **Diluted EPS** | $0.62 | $0.15 | [Condensed Consolidated Balance Sheets](index=7&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, total assets were **$1,056 million**, with total equity at **$653.1 million** and cash at **$92.6 million** Balance Sheet Highlights (in millions) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total current assets** | $737.2 | $722.8 | | **Total assets** | $1,056.0 | $1,043.6 | | **Total current liabilities** | $277.0 | $271.7 | | **Long-term debt** | $96.0 | $105.0 | | **Total equity** | $653.1 | $637.6 | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Q1 2025 operating cash flow was **$20.5 million**, a significant improvement from a **$47 million** use in Q1 2024 Q1 Cash Flow Summary (in millions) | Cash Flow Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Net cash provided by (used in) operating activities** | $20.5 | $(47.0) | | **Net cash used in investing activities** | $(4.2) | $(5.9) | | **Net cash (used in) provided by financing activities** | $(15.0) | $48.4 | | **Increase (decrease) in cash** | $1.8 | $(5.1) | | **Cash, end of period** | $92.6 | $58.1 | [Non-GAAP Financial Measures and Reconciliations](index=9&type=section&id=Non-GAAP%20Financial%20Measures%20and%20Reconciliations) Astec presents non-GAAP measures, including Adjusted Income from Operations of **$28.3 million** and Adjusted EBITDA of **$35.2 million** [Explanation of Non-GAAP Measures](index=9&type=section&id=Explanation%20of%20Non-GAAP%20Measures) Non-GAAP measures exclude non-core operational costs like transformation program expenses, restructuring charges, and acquisition transaction costs - Non-GAAP measures exclude costs related to: - Transformation program (e.g., ERP implementation) - Restructuring and other related charges - Goodwill and asset impairments - Gains or losses on sale of property and equipment - Transaction costs for acquisitions[34](index=34&type=chunk) [Reconciliation of Adjusted Income from Operations](index=10&type=section&id=Reconciliation%20of%20Adjusted%20Income%20from%20Operations) Adjusted income from operations for Q1 2025 was **$28.3 million**, primarily adjusted for transformation program and transaction costs GAAP to Non-GAAP Adjusted Income from Operations (in millions) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Income from operations (GAAP)** | $20.5 | $6.3 | | Transformation program | $7.0 | $6.5 | | Transaction costs | $0.8 | - | | Other adjustments | - | $(0.8) | | **Adjusted income from operations (Non-GAAP)** | $28.3 | $12.0 | | **Adjusted operating margin** | 8.6% | 3.9% | [Reconciliation of Adjusted EPS](index=11&type=section&id=Reconciliation%20of%20Adjusted%20EPS) Adjusted EPS for Q1 2025 was **$0.88**, derived from adjusted net income of **$20.3 million** after specific exclusions GAAP to Non-GAAP Adjusted EPS | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Diluted EPS (GAAP)** | $0.62 | $0.15 | | Transformation program adjustment | $0.31 | $0.29 | | Transaction costs adjustment | $0.03 | - | | Other adjustments | - | $(0.04) | | Income tax impact of adjustments | $(0.08) | $(0.06) | | **Adjusted EPS (Non-GAAP)** | $0.88 | $0.34 | [Reconciliation of EBITDA and Adjusted EBITDA](index=12&type=section&id=Reconciliation%20of%20EBITDA%20and%20Adjusted%20EBITDA) Adjusted EBITDA for Q1 2025 reached **$35.2 million**, reflecting a **10.7%** margin after non-core operational adjustments EBITDA and Adjusted EBITDA Reconciliation (in millions) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Net income attributable to controlling interest** | $14.3 | $3.4 | | **EBITDA** | $27.5 | $13.4 | | EBITDA margin | 8.3% | 4.3% | | **Adjusted EBITDA** | $35.2 | $18.9 | | Adjusted EBITDA margin | 10.7% | 6.1% | [Reconciliation of Free Cash Flow](index=13&type=section&id=Reconciliation%20of%20Free%20Cash%20Flow) Free cash flow for Q1 2025 was **$16.6 million**, a significant improvement from a negative **$52.8 million** in Q1 2024 Free Cash Flow Reconciliation (in millions) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Net cash provided by (used in) operating activities** | $20.5 | $(47.0) | | **Expenditures for property and equipment** | $(3.9) | $(5.8) | | **Free cash flow** | $16.6 | $(52.8) |

Core Insights - Astec Industries, Inc. reported strong financial results for Q1 2025, with increases in net sales, EBITDA, net income, and earnings per share, alongside the announcement of a definitive agreement to acquire TerraSource Holdings, LLC for $245 million [2][4][6]. Financial Performance - Net sales reached $329.4 million, a 6.5% increase from $309.2 million in Q1 2024 [4][29]. - EBITDA was $27.5 million, up 105.2% from $13.4 million in the previous year, with an adjusted EBITDA of $35.2 million, reflecting an 86.2% increase [4][30]. - Net income attributable to controlling interest was $14.3 million, a 320.6% increase compared to $3.4 million in Q1 2024, with adjusted net income of $20.3 million, up 160.3% [4][27]. - Diluted EPS increased to $0.62 from $0.15, representing a 313.3% rise, while adjusted EPS was $0.88, up 158.8% [4][27]. Segment Performance - Infrastructure Solutions segment net sales were $236.0 million, a 16.7% increase from $202.2 million, with an operating adjusted EBITDA of $42.9 million, up 67.6% [8][17]. - Materials Solutions segment net sales decreased by 12.7% to $93.4 million, primarily due to lower domestic equipment sales, with an operating adjusted EBITDA of $5.2 million, a slight decrease of 1.9% [8][17]. Acquisition Details - The acquisition of TerraSource is expected to enhance Astec's scale, improve aftermarket parts mix, and expand margins, with anticipated annual run-rate synergies of approximately $10 million [6][9]. - The transaction is expected to close in early Q3 2025, subject to regulatory approvals [6][9]. Liquidity and Cash Flow - Total liquidity was reported at $238.9 million, including $90.1 million in cash and cash equivalents [8]. - Operating cash flow for the quarter was $20.5 million, with free cash flow of $16.6 million [8][32].

Core Viewpoint - Astec Industries, Inc. is set to release its first quarter 2025 financial results on April 29, 2025, and will host a conference call to discuss these results [1][2]. Group 1: Conference Call Details - The conference call will be hosted by Jaco van der Merwe (President and CEO), Brian Harris (CFO), and Steve Anderson (Senior VP of Administration and Investor Relations) [2]. - The call is scheduled for April 29, 2025, at 8:30 a.m. Eastern Time, with access available via phone or a live webcast [1][2]. - A replay of the call will be available until May 13, 2025, and a transcript will be posted on the Investor Relations section of the company's website within 5 business days after the call [3]. Group 2: Company Overview - Astec Industries, Inc. specializes in manufacturing equipment for asphalt road building, aggregate processing, and concrete production [4]. - The company operates in two primary business segments: Infrastructure Solutions and Materials Solutions [4].

Core Viewpoint - Astec Industries, Inc. is set to release its first quarter 2025 financial results on April 29, 2025, and will host a conference call to discuss these results [1][2]. Group 1: Conference Call Details - The conference call will be hosted by Jaco van der Merwe (President and CEO), Brian Harris (CFO), and Steve Anderson (Senior VP of Administration and Investor Relations) [2]. - Participants can access the call by dialing (888) 440-4118 or +1 (646) 960-0833 for international callers, at least 10 minutes prior to the scheduled time [2]. - A live webcast will also be available, and an archived version will be accessible for ninety days post-call [2][3]. Group 2: Company Overview - Astec Industries, Inc. specializes in manufacturing equipment for asphalt road building, aggregate processing, and concrete production [4]. - The company operates in two primary business segments: Infrastructure Solutions and Materials Solutions [4].

Group 1 - Astec Industries, Inc. will participate in the Sidoti Small Cap Virtual Conference on March 19, 2025, with key executives presenting and engaging in one-on-one meetings [1] - The presentation by Astec will occur from 1:45 P.M. to 2:15 P.M. Eastern time, and interested parties can access it via a provided link [1] - The company specializes in manufacturing equipment for asphalt road building, aggregate processing, and concrete production, divided into two main business segments: Infrastructure Solutions and Materials Solutions [2] Group 2 - Infrastructure Solutions includes road building, asphalt and concrete plants, as well as thermal and storage solutions, while Materials Solutions encompasses aggregate processing and mining equipment [2] - Astec also offers controls and automation products aimed at enhancing productivity through improved equipment performance [2]

Financial Performance - Net sales for 2024 were $1,305.1 million, a decrease of 2.5% compared to $1,338.2 million in 2023[266]. - Gross profit for 2024 was $327.9 million, slightly down from $330.8 million in 2023, resulting in a gross margin of 25.1%[266]. - Net income for 2024 was $4.1 million, a significant decline from $33.7 million in 2023, reflecting a net margin of 0.3%[266]. - The company reported a goodwill impairment of $20.2 million in 2024, compared to no impairment in 2023[266]. - Cash flows from operating activities generated $23.0 million in 2024, down from $27.8 million in 2023[272]. - The company reported a comprehensive loss of $13.3 million for the year ended December 31, 2024, compared to a comprehensive income of $2.1 million in 2023[277]. - Income before income taxes decreased significantly from $42.8 million in 2023 to $13.9 million in 2024, a decline of 67.6%[396]. - The total income tax provision for 2024 was $9.8 million, compared to $9.1 million in 2023, representing a 7.7% increase[396]. Assets and Liabilities - Total current assets increased to $722.8 million in 2024 from $719.5 million in 2023, primarily driven by an increase in cash and cash equivalents[264]. - Total liabilities remained relatively stable at $406.0 million in 2024, compared to $405.6 million in 2023[264]. - As of December 31, 2024, the total equity of the company is $637.6 million, an increase from $626.9 million in 2023[277]. - The total cash and cash equivalents, including restricted cash, amounted to $541.7 million as of December 31, 2024[289]. - The company had total borrowings outstanding of $105.0 million under its credit facilities as of December 31, 2024, up from $72.0 million in 2023[385]. Inventory and Cost Management - The company’s inventory is significantly composed of steel, which is subject to market price volatility, impacting overall financial performance[241]. - As of December 31, 2024, total inventories decreased to $422.7 million from $455.6 million in 2023, with raw materials and parts at $275.4 million[357]. - The company reviews individual items in its inventory to determine if any item's net realizable value is below its carrying value[303]. - The company accrues for estimated product warranty costs at the time revenue is recognized, based on historical claims experience[320]. Foreign Operations and Currency Risk - Foreign operations represented 26.9% of total assets and 13.5% of total net sales for the year ended December 31, 2024, indicating significant exposure to foreign exchange risk[238]. - A 10% fluctuation in foreign exchange rates would have impacted net sales by $17.7 million and net income by $2.0 million for the year ended December 31, 2024[240]. - The company evaluates the need to hedge foreign currency transactions, but does not apply hedge accounting, impacting earnings recognition[239]. - The company’s foreign subsidiaries' operations are subject to currency fluctuations, which can affect the valuation of net assets in U.S. dollars[238]. Shareholder and Legal Matters - The company settled a shareholder class action lawsuit for $13.7 million, fully funded by insurance carriers, with the case dismissed on September 10, 2024[411]. - The company reached a settlement of $8.4 million related to a lawsuit involving its GEFCO subsidiary, paid in the fourth quarter of 2024[412]. - The company recorded a loss of $1.9 million related to the settlement of a lawsuit involving its Telsmith subsidiary, which was resolved for $6.3 million in September 2024[413]. Research and Development - Research and development costs amounted to $23.8 million, $22.0 million, and $31.5 million for the years 2024, 2023, and 2022, respectively[339]. Segment Information - The company operates in two reportable segments: Infrastructure Solutions and Materials Solutions, focusing on equipment for road building and related construction activities[282]. - The Infrastructure Solutions segment focuses on manufacturing and servicing asphalt and concrete plants, catering to a diverse range of customers including governmental agencies[433]. Tax and Deferred Tax Assets - The total deferred tax assets increased from $54.7 million in 2023 to $64.6 million in 2024, primarily due to an increase in amortization of research and experimental expenditures[398]. - The valuation allowance for deferred tax assets decreased by $0.1 million in 2024, driven by the release of the valuation allowance on deferred tax assets related to NOLs generated by the Company's Chilean subsidiary[399]. - The Company had unrecognized tax benefits of $16.8 million as of December 31, 2024, an increase from $13.0 million in 2023, reflecting a rise of 29%[403]. Goodwill and Intangible Assets - The Company’s goodwill balance as of December 31, 2024, was $79.0 million, down from $80.3 million in 2023, reflecting the impairment charge[370]. - The total intangible assets amounted to $66.5 million, with a net carrying value of $11.2 million after accumulated amortization[371]. - The amortization expense on intangible assets for 2024 was $4.8 million, compared to $5.5 million in 2023 and $8.5 million in 2022[371]. Compensation and Employee Benefits - The Company’s share-based compensation expense was $5.0 million in 2024, up from $4.1 million in 2023[277]. - The Company’s contributions to the 401(k) plan increased to $10.1 million in 2024, up from $8.1 million in 2023 and $7.7 million in 2022, reflecting a growth of 24.8% year-over-year[395].