v3.25.4
Summary of significant accounting policies (Policies)
 12 Months Ended
Dec. 31, 2025
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Basis of presentation Basis of presentation
These consolidated financial statements have been prepared in accordance with accounting principles
generally accepted in the United States (“U.S. GAAP”) and pursuant to the rules and regulations of the United
States Securities and Exchange Commission (“SEC”).
Use of estimates Use of estimates
These consolidated financial statements are prepared in accordance with U.S. GAAP, which requires
management to make assumptions and estimates about future events and apply judgments that affect the
amounts of assets, liabilities, revenues and expenses reported on these consolidated financial statements
and accompanying notes. Management’s assumptions, estimates and judgments are based on historical
experience, current trends and other factors that management believes to be reasonable under the
circumstances.
On a regular basis, management reviews the accounting policies, assumptions, estimates and judgments to
ensure that these consolidated financial statements are presented fairly and in accordance with U.S. GAAP,
and the Company revises its estimates, as appropriate, when events or changes in circumstances indicate
that revisions may be necessary. These consolidated financial statements reflect, in the opinion of
management, all material adjustments (which include only normal recurring adjustments) necessary to fairly
state, in all material respects, the financial position of the Company for the years presented.
Significant accounting estimates reflected in these consolidated financial statements are used for, but are not
limited to, accounting for the inventory excess and obsolescence reserves, revenue recognition under the
percentage of completion method, volume based rebates, contingent liabilities including warranty, share-
based compensation, pension and other postretirement benefits, tax valuation allowances, uncertain tax
positions, impairment of goodwill and other long-lived assets, asset retirement obligations, self-insurance
reserves, litigation and other loss contingencies, fair values of acquired assets and liabilities assumed under
the acquisition method of accounting and assumptions used for the allocation of general corporate expenses
prior to the Spin-Off. The Company also considers the potential impacts of climate-related factors in
developing the estimates and assumptions underlying the accounting areas noted above.
Estimates and assumptions have been based on the available information and regulations in place as of
December 31, 2025. Although these assumptions and estimates are based on management’s knowledge of,
and experience with, past and current events, actual results could differ materially from these assumptions
and estimates.
Fair value measurements Fair value measurements
Fair value accounting is applied for all financial assets and liabilities that are reported at fair value on these
consolidated financial statements on a recurring basis. Fair value is defined as the price that would be
received from selling an asset or paid to transfer a liability in an orderly transaction between market
participants at the measurement date. Financial Accounting Standards Board (“FASB”) Accounting Standards
Codification (“ASC”) Topic 820, Fair Value Measurement, establishes a defined framework to disclose the fair
value of assets and liabilities on both the date of their initial measurement as well as all subsequent periods.
The framework prioritizes the inputs used to measure fair value by the lowest level of input that is available
and significant to the fair value measurement.
The Company classifies and discloses assets and liabilities carried at fair value in one of the following three
categories:
•Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the
reporting entity can access at the measurement date.
•Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or
liability, either directly or indirectly.
•Level 3: Unobservable inputs for which market data are not available and that are developed using
the best information available about the assumptions that market participants would use when
pricing the asset or liability.
Considerable judgment may be required in interpreting market data used to develop the estimates of fair
value.
The estimated fair value of a financial instrument is the amount at which the instrument could be exchanged
in a current transaction between willing parties, other than a forced or liquidation sale. These estimates,
although based on the relevant market information about the financial instrument, are subjective in nature and
involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision.
Changes in assumptions could significantly affect the estimates.
The Company measures certain assets and liabilities at fair value on a nonrecurring basis. Assets and
liabilities that are measured at fair value on a nonrecurring basis include long-lived assets and goodwill, which
would generally be recorded at fair value as a result of an impairment charge. The fair value measurements of
assets acquired and liabilities assumed are also measured on a nonrecurring basis on the acquisition date
using income, market or cost valuation techniques based on inputs that are not observable in the market and
therefore represent Level 3 inputs. Such inputs may include the projection of cash flows, the estimated
discount rate that reflects the level of risk associated with receiving future cash flows, comparable market
transactions or replacement costs or reproduction costs. Intangible assets are often valued using inputs
primarily for the income approach using the excess earnings method or relief from royalty method. The
significant inputs used in estimating fair value include revenue projections of the business, including
profitability, attrition rates and the estimated discount rate that reflects the level of risk associated with
receiving future cash flows.
See Note 15 (Pension and other postretirement benefits) for further information about the fair value of the
Company’s defined benefit pension plan assets. See Note 10 (Debt) for further information about the fair
value of the Company’s third-party long-term debt. See Note 4 (Acquisitions) for further information about
the fair value of the Company’s acquired assets and liabilities.
The carrying values of the Company’s current assets and current liabilities approximate their fair values
because of the short-term nature of these balances.
Revenue recognition and Contract assets and liabilities Revenue recognition
Revenues are recognized in accordance with ASC Topic 606, Revenue from Contracts with Customers. The
Company earns revenue from the sale of Building Materials products (cement, aggregates, ready-mix
concrete, asphalt and other construction materials) and Building Envelope products (advanced roofing and
wall systems, including single-ply membranes, insulation, shingles, sheathing, waterproofing and protective
coatings, along with adhesives, tapes and sealants that are critical to the application of roofing and wall
systems).
The Company recognizes revenue when it satisfies a performance obligation by transferring a promised good
or service to a customer. This occurs when the customer obtains control of that good or service. The
customer obtains control when the significant risks and rewards of products sold are transferred according to
the specific delivery terms that have been formally agreed with the customer, which is generally upon
delivery when the bill of lading is signed by the customer as evidence that they have obtained physical
possession and accepted the products delivered to them.
The amount of revenue recognized is the amount allocated to the satisfied performance obligation. A
performance obligation may be satisfied at a point in time, usually for promises to transfer goods, or over
time, typically for promises to transfer services or for construction-related activities. For performance
obligations satisfied over time, the Company recognizes revenue over time by selecting an appropriate
method for measuring the Company’s progress towards complete satisfaction of that performance obligation.
The objective when measuring progress is to depict the Company’s performance in transferring control of
goods or services promised to a customer. Over time revenues are related to the Company's construction-
related activities and contracts, which are primarily short-term in nature. A majority of the over time revenues
is derived from construction contracts started during a reporting period and completed during the
subsequent reporting period.
The Company often sells its core products with volume discounts. Revenue is recognized based on the price
specified on the invoice, net of estimated discounts. Accumulated experience is used to estimate the
discounts. The Company records discounts as a reduction of revenues with a corresponding offset to
Accounts receivable, net when there is both the contractual right and intent to offset. When these offset
conditions do not exist, the Company records discounts as reduction of revenues with a corresponding
accrued liability recorded within Accounts payable. No element of financing is deemed present as the sales
are made with credit terms largely ranging between 30 days and 60 days depending on the specific terms
agreed to with the Company, which is consistent with market practice. Generally, cement, aggregates,
asphalt, concrete and roofing systems are not returned as a customer will only accept these products once
they have passed a stringent quality check at the point of delivery. The Company has elected to treat freight
and delivery activities as fulfillment costs and recognize the costs within Cost of revenues on the
consolidated statements of operations at the time the related revenue is recognized.
The Company offers separately priced extended warranties, generally ranging from 5 to 30 years, on many of
its roofing systems. Revenues from such activities are deferred and recognized in income over the life of the
warranty on a straight-line basis. As such, a portion of the overall transaction price is allocated to these
performance obligations and recognized in revenue over time, as the performance obligations are satisfied.
The Company is deemed to be an agent when collecting sales taxes from customers. Sales taxes collected
are recorded as liabilities until remitted to taxing authorities and therefore are not reflected in the
consolidated statements of operations. The sales tax liability is recorded within Other current liabilities on the
consolidated balance sheets.
Costs to obtain and fulfill contracts are immaterial and are expensed as incurred when the expected
amortization period is one year or less. See Note 3 (Revenues) and Note 14 (Segment and geographic
information) for further information.
Contract assets and liabilities
The timing of revenue recognition under the cost-to-cost method of accounting may differ from the timing of
invoicing to customers, which may result in a contract asset or a contract liability. Contracts from contracting
services usually stipulate the timing of payment and are billed as work progresses in accordance with agreed
upon contractual terms. Generally, billing to the customer occurs contemporaneously to revenue recognition.
Contract assets, which are the Company’s right to consideration that is conditional on something other than
the passage of time, relate mainly to construction and paving activities. Contract assets occur when revenues
are recognized under the cost-to-cost measure of progress, which exceeds amounts billed on uncompleted
contracts. Such amounts will be billed as standard contract terms allow, usually based on various measures of
performance or achievement. Contract assets are not considered a significant financing component as they
are intended to protect the customer in the event the Company does not satisfy its obligations under the
contract. Contract assets are recorded within Prepaid expenses and other current assets and Other
noncurrent assets on the consolidated balance sheets.
Contract liabilities, which are the Company’s obligation to transfer goods or services to a customer for which
the Company has already received consideration, relate mainly to advance payments from customers and
warranty programs. A contract liability occurs when there are billings in excess of revenues recognized under
the progress on uncompleted contracts. Contract liabilities decrease as revenue is recognized from the
satisfaction of the related performance obligation. Contract liabilities are not considered to have a significant
financing component as they are used to meet working capital requirements that generally are higher in the
early stages of a contract and are intended to protect the Company from the other party failing to meet its
obligations under the contract. Contract liabilities are recorded within Other current liabilities and Other
noncurrent liabilities on the consolidated balance sheets.
Warranties Warranties
As outlined above within the revenue recognition policy, the Company offers extended warranty contracts on
sales of certain products within the Building Envelope segment. Costs under extended warranty contracts are
expensed as incurred and recorded within Cost of revenues. The Company evaluates extended warranty
contracts on a contract duration basis and recognizes losses on defined pools of extended warranty
contracts when the expected costs for a given pool of contracts exceed related unearned revenue. Total
expected costs of providing extended product warranty services are actuarially determined using standard
quantitative measures based on historical claims experience and management judgment.
Warranties In addition to extended warranties, the Company also provides standard warranties on many of its products
within the Building Envelope segment. Standard warranty terms range from one year to limited lifetime
coverage. The Company estimates its future warranty costs based on historical trends and product sales.
From time to time, the Company may also increase or decrease preexisting warranty accruals for updated
estimates of the costs necessary to settle specific product liability claims. These updates are recorded during
the period in which (a) the circumstances giving rise to the specific product liability claims become known and
(b) the costs to satisfactorily address the situation are both probable and estimable.
Business combinations Business combinations
Acquisitions are accounted for as business combinations using the acquisition method in accordance with
ASC Topic 805, Business Combinations, which requires the purchase price to be allocated to assets acquired
and liabilities assumed based on estimated 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. The
Company allocates the purchase price to the fair values of the tangible and identifiable intangible assets
acquired and liabilities assumed as of the date of acquisition. Any excess of the purchase price over the fair
value of the assets acquired and liabilities assumed is recorded as goodwill.
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 defined as the price that would be received
from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the
measurement date. A fair value measurement assumes the highest and best use of the asset by market
participants.
Allocations of the purchase price are based on preliminary estimates and assumptions at the date of
acquisition and are subject to revision based on final information received, including appraisals and other
analyses which support underlying estimates within the measurement period, a period of no more than one
year from the acquisition date. Measurement period adjustments are generally recorded as increases or
decreases to goodwill recognized in the transaction.
The results of acquired businesses have been included in these consolidated financial statements beginning
on the acquisition date.
Foreign currency transactions and translations Foreign currency transactions and translation
These consolidated financial statements are presented in U.S. dollars, which is the reporting currency of the
Company. A portion of the Company’s revenues are in currencies other than its reporting currency due to the
Company’s operations in Canada. As such, the Company has exposure to adverse changes in the U.S. dollar /
Canadian dollar exchange rate.
Operating results and cash flows from subsidiaries whose functional currency is not the U.S. dollar have been
translated into U.S. dollars at average exchange rates for the relevant periods, and the related balance sheets
of such subsidiaries have been translated into U.S. dollars at the rates of exchange in effect at the balance
sheet date. The Company releases any related cumulative foreign currency translation adjustment into Net
income on the consolidated statements of operations only if a foreign entity is sold or the complete or
substantially complete liquidation of the foreign entity occurs. Adjustments arising on translation of the
operating results and net assets of these subsidiaries and equity method investments are recognized as a
component of Accumulated other comprehensive loss on the consolidated balance sheets.
Transactions by entities in currencies other than the respective functional currencies are recorded at the rate
of exchange in effect at the date of the transaction. Monetary assets and liabilities denominated in foreign
currencies are remeasured at the rate of exchange in effect at the balance sheet date. Non-monetary items
are measured at historical rates. The impact of realized and unrealized gains and losses arising from foreign
currencies was immaterial in all of the years presented.
Self-insurance reserves Self-insurance reserves
The Company’s wholly-owned captive insurance company, Mountain Prairie Insurance Company (“MPIC”),
which is subject to applicable insurance rules and regulations, is the primary insurer for the Company’s
exposure related to workers’ compensation, general liability, property, product liability and automobile liability.
Additionally, the Company maintains a self-insurance reserve for health insurance programs offered to
eligible employees. The Company is self-insured up to certain retention limits for these exposures and
purchases excess coverage from unrelated insurance carriers and obtains third-party coverage for other
forms of insurance.
MPIC establishes a reserve for estimated losses on reported claims and those incurred but not yet reported
utilizing actuarial projections and historical trends. In establishing self-insurance reserves, management
applies significant judgment in assessing the probability of loss and the ability to reasonably estimate
potential exposure, including consideration of information from both internal and external legal counsel.
Certain claims and litigation costs, due to their unique nature, are not included in actuarial studies. For
matters not included in actuarial studies, legal defense costs are accrued when incurred. We assess unique
cases individually and, where appropriate, establish specific provisions to address the particular
circumstances and potential exposures associated with these matters. The reserves are classified within
Other current liabilities or Other noncurrent liabilities on the consolidated balance sheets based on projections
of when the estimated loss will be paid. The estimates that are utilized to record potential losses on claims
are inherently subjective, and actual claims could differ from amounts recorded, which could result in an
increase or decrease of expense in future years.
Pension and other postretirement benefits Pension and other postretirement benefits:
The Company sponsors defined benefit pension plans, other postretirement benefit plans and defined
contribution plans in which only employees, retirees and former employees of the Company participate. The
Company’s employees also participate in certain multiple-employer and union-sponsored multiemployer
pension plans to which the Company contributes along with other employers.
Defined benefit pension plans sponsored by the Company
The Company uses professionally qualified independent actuaries to value its defined benefit pension plan
obligations on an annual basis at year end. The liabilities and costs of pension benefits are determined using
the projected unit credit method. The Company recognizes the funded status of its defined benefit pension
plans and other postretirement benefit plans (the difference between the fair value of plan assets and the
benefit obligation) as an asset or liability on the consolidated balance sheets.
Actuarial gains and losses are recognized as a component of Other comprehensive income (loss), net of tax.
Amounts recognized in Accumulated other comprehensive loss on the consolidated balance sheets are
reclassified to Net income on the consolidated statements of operations in a systematic manner over the
average remaining service period of participants and the amount amortized is determined using a corridor
approach. The pension and other postretirement benefit obligations are measured as the present value of
estimated future cash flows using discount rates that are determined by reference to the interest rates on
high quality corporate bonds, with the currency and terms of the corporate bonds consistent with the
currency and estimated terms of the pension and other postretirement benefit obligations.
The cost for pension and other postretirement benefit plans charged to the consolidated statements of
operations consists of service cost, net interest expense, expected return on plan assets, amortization of
actuarial gains and losses and curtailment and settlement gains and losses. The Company presents the
service cost component of Net periodic benefit cost within Cost of revenues and Selling, general and
administrative expenses on the consolidated statements of operations. The other components of Net periodic
benefit cost are reported within Other non-operating income (expense), net on the consolidated statements
of operations.
Defined contribution plans sponsored by the Company
In addition to the defined benefit pension plans and other postretirement benefit plans described above, the
Company sponsors defined contribution plans. The Company’s contributions to defined contribution plans are
charged to Cost of revenues and Selling, general and administrative expenses on the consolidated
statements of operations in the period to which the contributions relate.
Union-sponsored multiemployer pension plans
The Company participates in and contributes to 18 union-sponsored multiemployer pension plans for U.S.
employees, 17 union-sponsored multiemployer pension plans for Canadian employees and 13 union-
sponsored registered retirement savings plan for Canadian employees, all of which are currently open plans.
The Company’s contributions to union-sponsored multiemployer pension plans are charged to Cost of
revenues on the consolidated statements of operations in the period to which the contributions relate. The assets of the Company’s defined benefit pension plans are managed in Canada by fiduciary committees
and in Switzerland by Pension Fund Boards under Swiss law, with support from third party investment
consultants, for the benefit of the plan members. Consideration is given to the financial needs and
circumstances of the plans, the long-term nature of the benefit obligations and time horizon available for
investment, and the nature of the plans cash flows and liabilities. The investment strategy is set at the plan
level, typically to maintain a diversified portfolio of assets to reduce risk with the objective of minimizing
volatility and meeting future obligations and long-term cash requirements as they become due. The
investment policy for each plan specifies the investment objectives, responsibilities, asset allocation
guidelines, and investment monitoring requirements.
The expected long-term rate of return on plan assets is developed based on a targeted asset allocation
range, considering investment community forecasts and current market conditions to develop expected
returns for each of the asset classes used by the plans. These expected returns are weighted to reflect the
asset allocation of each plan.
The following is a description of the methods and assumptions used to estimate the fair value of the defined
benefit pension plan assets:
•Cash and cash equivalents: Cash and all highly liquid securities with original maturities of three
months or less are classified as Cash and cash equivalents. These assets are classified as Level 1.
•Equity instruments: Individual securities that are valued at the closing price or last trade reported on
the major market on which they are traded are classified as Level 1. Commingled funds that are
publicly traded are valued based upon market quotes and are classified as Level 1. Non-publicly
traded funds that require one or more significant unobservable inputs reflecting assumptions that
market participants would be expected to use in pricing the assets are classified as Level 3.
•Debt instruments: Debt instruments are valued based on prices derived from observable inputs and
are classified as Level 1 or Level 2. Level 2 investments may also include commingled funds that have
a readily determinable fair value based on observable prices of the underlying securities.
•Insurance contracts: Buy-in annuity contracts are valued based on the estimated surrender value of
the contracts, which are classified as Level 3 of the fair value hierarchy. The fair values of the
insurance contracts are determined by the insurance company’s valuation models and represent the
value the Company would receive upon surrender of these policies as of the measurement date.
•Other: Other is composed of property and alternative investments, which are valued based on prices
derived from observable market inputs, including observable prices of underlying investments, as
provided by third-party managers, and are classified as Level 2.
Share-based compensation Share-based compensation
The Company grants share-based awards, which consist of restricted stock units (“RSUs”), performance
stock units (“PSUs”), and performance stock options (“PSOs”). All of the share-based compensation awards
are classified as equity awards. Share-based compensation cost is measured at the grant-date fair value. The
Company uses the straight-line amortization method to recognize compensation expense related to RSUs,
which only have a service condition. For PSUs and PSOs based on total shareholder return, compensation
expense is recognized whether or not the market condition is attained, as long as the service condition is met.
For PSUs based on internal financial performance metrics, compensation expense is recognized over the
service period based on the estimated achievement of the performance criteria, which is evaluated on a
quarterly basis. The Company has elected to recognize forfeitures as an adjustment to compensation
expense in the same period as the forfeitures occur. The Company either purchases shares on the open
market, utilizes treasury shares, or issues new Ordinary Shares to satisfy the vesting of share-based awards.
Advertising costs Advertising costsAdvertising and promotion costs are expensed as incurred.
Income taxes Income taxes
For 2025, the Company’s income tax provision reflects a combination of (i) income tax expense determined
using the separate return method for operations that were previously included in the Holcim’s tax filings and
(ii) standalone income tax expense for periods and jurisdictions in which the Company is required to file tax
returns based on its operating footprint. Given that prior to the Spin-Off the Company’s U.S. and Canadian
operations were not included in Holcim’s tax filings, U.S. and Canadian tax returns will be filed on a full-year
basis in 2025. Swiss operations were included in Holcim’s Swiss legal entity tax filings prior to the Spin-Off,
hence, standalone Swiss operations beginning post Spin-Off will be reflected in separate Swiss legal entity
tax returns filed by the Company. Tax liabilities as of December 31, 2025 are reported within the consolidated
balance sheet based upon estimated amounts due to tax authorities for which the Company is the primary
obligor.
Prior to the Spin-Off, the Company’s income tax provision was prepared using the separate return method.
The separate return method applies the concepts of ASC Topic 740, Income Taxes, to the standalone
financial statements of each member of the combined group as if the group members were separate
taxpayers. The calculation of the Company’s income taxes using the separate return method requires
judgment and use of both estimates and allocations. Furthermore, current obligations for taxes that may arise
under the separate return method where the Company’s operations were included in tax returns with the
activities of Holcim are deemed settled with Holcim as a component of Net parent investment for purposes of
these consolidated financial statements. As a result, the income taxes of the Company prior to the Spin-Off,
as presented in these consolidated financial statements, may not be indicative of the income taxes that the
Company will generate in the future.
The Company recognizes deferred tax assets and liabilities for the future tax consequences attributable to
differences between the financial statement carrying amounts of assets and liabilities and their respective tax
bases. The Company also recognizes deferred tax assets for net operating losses and tax credit
carryforwards. Deferred tax assets are assessed for realizability and, where it is more likely than not that a
tax benefit will not be realized, a valuation allowance is recorded to reduce the deferred tax asset to an
amount that will, more likely than not, be realized in the future. Deferred tax assets and liabilities are
measured using enacted tax rates applicable in the years in which they are expected to be recovered or
settled. The effect of a change in tax law on deferred tax assets and liabilities is recognized in the provision
for income taxes in the period that includes the enactment date. The Company releases tax effects from
Accumulated other comprehensive loss when the underlying items affect earnings.
The calculation of tax liabilities involves dealing with uncertainties in the application of complex tax
regulations. The Company determines if the weight of available evidence indicates that it is more likely than
not that a tax position will be sustained on tax audit, assuming that all issues are audited and resolution of any
related appeals or litigation processes are concluded. The tax benefit is then measured as the largest amount
that is more than 50% likely to be realized upon ultimate settlement. The reserves for uncertain tax positions
are adjusted as facts and circumstances change, such as upon closing of a tax audit, expiration of statutes of
limitation on potential assessments or refinement of an estimate. To the extent that the final outcome of
these matters is different than the amounts recorded, such differences will impact the provision for income
taxes in the period in which such a determination is made. The provisions for income taxes include the impact
of reserves for uncertain tax positions, along with the related interest and penalties.
Cash and cash equivalents Cash and cash equivalents
Cash and cash equivalents comprise short-term, highly liquid investments with original maturities of three
months or less at the time of purchase. From time to time, the Company invests in money market funds and
time deposits and includes the interest income generated from these investments within Interest expense,
net on the consolidated statements of operations. Interest income generated from these investments was
$36 million, $21 million and $10 million for the years ended December 31, 2025, 2024 and 2023, respectively.
There was no balance in money market funds as of December 31, 2025. As of December 31, 2024, the
balance of money market funds was $280 million. As of December 31, 2025 and 2024, the balances for time
deposits were $1,334 million and $840 million, respectively. The fair value of the Company’s money market
funds and time deposits approximate carrying value due to their short-term maturities.
Prior to the Spin-Off, a majority of the Company’s subsidiaries participated in a cash pooling arrangement
under Holcim’s centralized treasury function where cash was swept from subsidiary accounts, including the
Company’s accounts, on a daily basis. The Company’s residual cash pooling balances as of the end of each
reporting period prior to the Spin-Off were recorded within Related-party notes receivable. Subsequent to the
Spin-Off, the Company manages its own cash and cash equivalents and no longer participates in Holcim’s
centralized cash pooling arrangements.
Accounts receivable, net Accounts receivable, net
The Company’s customers are primarily within the United States and Canada. No individual customer
represents more than 10% of the Company’s accounts receivable, net during any of the fiscal years
presented. A trade receivable is recognized when the products are delivered to a customer as this is the point
in time that the consideration becomes unconditional because only a passage of time is required before the
payment is due. Accounts receivable is recorded net of an allowance for credit losses that are not expected
to be recovered.
The Company recognizes the allowance for credit losses based on management’s expectation of the asset’s
collectability. The allowance for credit losses is based on management’s assessment of the collectability
considering various factors including historical experience with bad debts and the aging of such accounts
receivable, as well as management’s expectations of conditions in the future, if applicable. Any balances that
are eventually deemed uncollectible (after all means of collection have been exhausted and the potential for
recovery is considered remote) are written off against the allowance for credit losses.
Inventories Inventories
Inventories are stated at the lower of inventory cost and net realizable value. Inventory cost is determined
using the weighted-average cost method. In determining the net realizable value, the Company considers
factors such as deterioration, obsolescence, expected future demand and past experience.
Financial instruments Financial instruments
The Company mainly uses various derivative financial instruments in order to reduce its exposure to changes
in commodity prices. The Company has entered into swaps and options with external counterparties to
manage its exposure to commodity risks. As of December 31, 2025, these contracts primarily have a
maximum remaining maturity of 24 months. The Company’s derivatives are not subject to master netting
arrangements that allow for the offset of assets and liabilities.
The Company enters into derivatives to manage cash flow exposures. Cash flow exposures relate to the
variability of future cash flows associated with recognized assets or liabilities or forecasted transactions.
When a derivative is executed and hedge accounting is appropriate, it is designated as either a fair value
hedge, a cash flow hedge or a net investment hedge. Whether designated as hedges for accounting purposes
or not, all derivatives are linked to an appropriate underlying exposure. On an ongoing basis, the Company
assesses the effectiveness of all derivatives designated as hedges for accounting purposes to determine if
they continue to be highly effective in offsetting changes in fair values or cash flows of the underlying hedged
items. If it is determined that a hedge is not highly effective, then hedge accounting will be discontinued
prospectively.
Derivatives are initially recognized at fair value on the date a derivative contract is entered into and are
subsequently remeasured at their fair value. The Company’s derivatives are primarily classified as Level 2.
The fair values of the Company’s derivatives are not material. The method of recognizing the resulting gain or
loss is dependent on the nature of the item being hedged. Derivative assets, which were related-party in
nature prior to the Spin-Off, are included within Prepaid expenses and other current assets and Other
noncurrent assets, and derivative liabilities, which were related-party in nature prior to the Spin-Off, are
included within Other current liabilities and Other noncurrent liabilities on the consolidated balance sheets.
Financial instruments Changes in fair value of derivatives that are designated as cash flow hedges are deferred in Accumulated
other comprehensive loss on the consolidated balance sheets and are reclassified to Net income on the
consolidated statements of operations as the underlying hedged transaction affects Net income.
Reclassification to Net income may take place in the period during which the hedged transaction occurs or if
it becomes probable that the forecasted transaction will not occur. Provided the hedge remains highly
effective, any ineffectiveness is deferred in Accumulated other comprehensive loss on the consolidated
balance sheets and is reclassified to Net income on the consolidated statements of operations as the
underlying hedged transaction affects Net income.
Property, plant and equipment, net Property, plant and equipment, net
Property, plant and equipment, net is stated at cost less accumulated depreciation, depletion and any
accumulated impairments. Costs are only included in the asset’s carrying amount when it is probable that
economic benefits will flow to the Company in future periods and the costs can be measured reliably. Costs
include initial estimates for dismantling and removing the item and for restoring the site on which it is located.
All other repair and maintenance expenses are charged to the consolidated statements of operations during
the period in which they are incurred. The Company capitalizes interest cost as a component of construction
in progress on qualifying construction projects. No interest was capitalized for construction in progress for
the years ended December 31, 2025, 2024 and 2023. Government grants received related to capital projects
are deducted from property, plant and equipment and were immaterial in all of the years presented.
The straight-line method of depreciation is used for substantially all of the assets for financial reporting
purposes, except for land with raw material reserves which uses the units-of-production method of
depreciation (depletion). Property, plant and equipment is depreciated over its useful life, which are based on
management’s estimates of the period that the assets can be used by the Company. Mineral reserves are
depleted based on the units of output expected to be obtained by the Company. Depreciation and depletion
expenses are recorded within Cost of revenues and Selling, general and administrative expenses on the
consolidated statements of operations.
Property, plant and equipment, net Property, plant and equipment are reviewed for impairment whenever events or changes in circumstances
indicate that the carrying amount of an asset group may not be recoverable. An impairment loss is recognized
if expected future undiscounted cash flows over the estimated remaining service life of the related asset
group are less than the asset group’s carrying value.
Goodwill and intangible assets, net Goodwill and intangible assets, net
Goodwill represents the excess purchase price paid for acquired businesses over the estimated fair value of
identifiable assets and liabilities. Goodwill is tested for impairment once a year, during the fourth quarter, or
more frequently if events or changes in circumstances indicate that the carrying amount may not be
recoverable. The Company assesses goodwill for impairment at the reporting unit level, which is at the
operating segment level, or one level below. The Company’s test for goodwill impairment starts with a
qualitative assessment to determine whether it is necessary to perform a quantitative goodwill impairment
test. If qualitative factors indicate that it is more likely than not that the fair value of the reporting unit is less
than the carrying value of its net assets, then the Company proceeds with a quantitative goodwill impairment
test. The Company may also choose to bypass the qualitative assessment for any reporting unit in its goodwill
assessment and proceed directly to performing the quantitative assessment.
Under the quantitative impairment test, if the carrying amount of the reporting unit exceeds its fair value, then
the Company recognizes an impairment loss equal to that excess, up to the total amount of goodwill
associated with that reporting unit. Under the quantitative impairment test, the Company calculates the
estimated fair value of a reporting unit using the income approach. For this approach, the Company utilizes
internally developed discounted cash flow models that incorporate various significant assumptions. These
significant assumptions utilized in determining the fair values of our reporting units generally include
forecasted revenues, expenses, resulting EBITDA Margins and related cash flows based on assumed long-
term growth rates and demand trends, future projected investments to expand our reporting units, discount
rates and terminal growth rates.
The Company’s long-lived intangible assets consist of customer lists, software, mining rights, patented and
unpatented technology, trademarks and other intangible assets. Long-lived intangible assets are recognized
and recorded at their acquisition date fair values. Long-lived intangible assets are amortized on a straight-line
basis over their respective estimated useful lives to the estimated residual values, except for mining rights,
which are depleted on a volume basis. The Company reviews long-lived intangible assets for impairment
whenever events or changes in circumstances indicate that the carrying amount of the long-lived intangible
assets may not be recoverable.
Debt Debt
Debt is recorded at the proceeds received by the Company, net of debt issuance costs. Debt is subsequently
stated at amortized cost. Debt issuance costs are amortized to interest expense over the term of the debt.
Debt issuance discounts and premiums are also amortized to interest expense using the effective interest
rate method over the term of the debt.
Leases Leases
The Company determines if an arrangement is or contains a lease at contract inception and recognizes a
right-of-use (“ROU”) asset and a lease liability at the lease commencement date in accordance with ASC
Topic 842, Leases. The lease liability is measured at the present value of future lease payments as of the
lease commencement date. The ROU asset recognized is based on the lease liability adjusted for prepaid and
deferred rent, initial direct costs and any unamortized lease incentives.
Leases are evaluated and classified as either finance leases or operating leases. A lease is classified as a
finance lease if any one of the following criteria are met: (1) the lease transfers ownership of the asset by the
end of the lease term; (2) the lease contains an option to purchase the asset that is reasonably certain to be
exercised; (3) the lease term is for a major part of the remaining useful life of the asset; (4) the underlying
asset is of such a specialized nature that is expected to have no alternative use to the lessor at the end of the
lease term; or (5) the present value of the lease payments equals or exceeds substantially all of the fair value
of the asset. A lease is classified as an operating lease if it does not meet any one of the above criteria.
The subsequent measurement of finance leases is accounted for at amortized cost using the effective-
interest method. The subsequent measurement of operating leases is accounted for using a single lease cost,
resulting in straight-line lease expense recognition. Leases with an initial term of twelve months or less are
not recorded on the consolidated balance sheets but are instead expensed on a straight-line basis over the
lease term. Variable lease payments are expensed as incurred.
For leases that do not specify the implicit discount rate, the Company uses its incremental borrowing rate,
which is equal to the rate of interest the Company would have to pay on a collateralized basis to borrow an
amount equal to the lease payments under similar terms. Leases may include renewal options that could
extend the lease term for a specified period of time. As of the commencement date of each lease,
management determines if the Company is reasonably certain to exercise these options and adjusts the lease
term accordingly.
Operating lease expense is recognized on a straight-line basis over the lease term and is included within Cost
of revenues and Selling, general and administrative expenses on the consolidated statements of operations.
Finance lease amortization is included within Cost of revenues and Selling, general and administrative
expenses on the consolidated statements of operations, and interest expense is included within Interest
expense, net on the consolidated statements of operations. The assets and liabilities relating to operating
leases are included within Operating lease right-of-use assets, net, Operating lease liabilities and Noncurrent
operating lease liabilities on the consolidated balance sheets.
Asset retirement obligations Asset retirement obligations
The Company recognizes asset retirement obligations (“AROs”) primarily related to its mining, cement and
aggregates plant operations. AROs are legal obligations associated with the retirement of long-lived assets
resulting from the acquisition, construction, development or normal use of the underlying assets, such as
legal obligations for land reclamation. The Company estimates its ARO liabilities for final reclamation and
closure of operations based upon detailed calculations of the amount and timing of the future cash spending
to perform the required work. Spending estimates are escalated for inflation and then discounted at the
credit-adjusted, risk-free rate. The Company recognizes AROs at the estimated fair value in the period
incurred, and fair value estimates are determined using Level 3 inputs in the fair value hierarchy. The
accretion of the liability is recorded within Cost of revenues on the consolidated statements of operations.
The associated asset retirement costs are capitalized and depreciated as part of the carrying amount over
the estimated useful life of the underlying long-lived asset. As changes in estimates occur (such as mine plan
revisions, changes in estimated costs, or changes in timing of the performance of reclamation activities), the
resulting changes to the obligation and asset are recognized at the appropriate credit-adjusted, risk-free rate.
The Company recognizes a gain or loss on settlement of an ARO if the ARO is settled for an amount other
than the carrying amount of the liability.
Environmental remediation costs Environmental remediation costs
The Company records accruals for environmental remediation liabilities within Other noncurrent liabilities on
the consolidated balance sheets in the period in which it is probable that a liability has been incurred and the
appropriate amounts can be estimated reasonably. Such accruals are adjusted as further information is
discovered or circumstances change. These costs are not discounted to their present value.
Noncontrolling interests Noncontrolling interests
Noncontrolling interests represent the portion of the equity of a subsidiary of the Company that is not
attributable either directly or indirectly to the Company. Noncontrolling interests are presented separately on
the consolidated statements of operations and are presented within equity on the consolidated balance
sheets, but distinguished from the Company’s equity as represented by Total Equity attributable to the
Company on the consolidated balance sheets. Acquisitions of noncontrolling interests are accounted for as
transactions with equity holders in their capacity as equity holders and therefore no goodwill is recognized as
a result of such transactions. Noncontrolling interests are measured initially at fair value.
New accounting standards New accounting standards:
Recently adopted accounting pronouncements
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax
Disclosures. The ASU expands the income tax disclosures and now requires that the Company disclose (i) the
income tax rate reconciliation using both percentages and reporting currency amounts; (ii) specific categories
within the income tax rate reconciliation; (iii) additional information for reconciling items that meet a
quantitative threshold; (iv) the composition of state and local income taxes by jurisdiction; and (v) the amount
of income taxes paid disaggregated by jurisdiction. The Company has adopted ASU 2023-09 on a
retrospective basis for the year ending December 31, 2025.
See Note 13 (Income taxes) for the disclosure related impacts of adopting this standard.
Recently issued accounting pronouncements not yet adopted
In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income -
Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses.
Additionally, in January 2025, the FASB issued ASU 2025-01 to clarify the effective date of ASU 2024-03.
The standard is intended to require more detailed disclosures about specified categories of expenses
(including employee compensation, depreciation and amortization) included in certain expense captions
presented on the face of the statements of operations. ASU 2024-03, as clarified by ASU 2025-01, is
effective for fiscal years beginning after December 15, 2026, and for interim periods within annual reporting
periods beginning after December 15, 2027. Early adoption is permitted. The amendments should be applied
either prospectively to financial statements issued for reporting periods after the effective date of ASU
2024-03 or retrospectively to any or all prior periods presented in the financial statements. The Company is
currently evaluating the new standard to determine the impact ASU 2024-03 may have on its financial
statements and related disclosures, and expects to make additional disclosures upon adoption.
Contingencies In the ordinary course of conducting its business activities, the Company is involved in judicial, administrative
and regulatory investigations and proceedings, as well as lawsuits and claims of various natures, involving
both private parties and governmental authorities, relating to product liability, general and commercial liability,
competition, environmental, employment, health and safety and other matters. These claims and proceedings
include insured, self-insured, and uninsured matters that are brought on an individual, collective,
representative and class-action basis.
The Company records a liability for contingencies when the occurrence of a loss is probable and the amount
can be reasonably estimated, and records legal fees as incurred. If a range of amounts can be reasonably
estimated and no amount within the range is a better estimate than any other amount, then the minimum of
the range is accrued. The Company does not accrue liabilities when the likelihood that the liability has been
incurred is probable but the amount cannot be reasonably estimated or when the liability is believed to be
only reasonably possible or remote. For contingencies where an unfavorable outcome is probable or
reasonably possible and which are material, the Company discloses the nature of the contingency and, where
an estimate can reasonably be made, an estimate of the possible loss. Accruals are based on the best
information available, but in certain situations, management is unable to estimate an amount or range of a
reasonably possible loss, including, but not limited to, when: (1) the damages are indeterminate, (2) the
proceedings are in the early stages, (3) numerous parties are involved, or (4) the matter involves novel or
unsettled legal theories.
The aggregate range of reasonably possible losses in excess of accrued liabilities, if any, associated with
these unresolved legal actions is not material. In some cases, the Company cannot reasonably estimate a
range of loss because there is insufficient information regarding the matter. Although it is not possible to
predict with certainty the outcome of these unresolved legal actions, the Company believes that these
actions will not individually or in the aggregate have a material adverse effect on our consolidated results of
operations, financial position or liquidity. In 2025, the Company recorded nonrecurring legal costs of $46
million.