Arcosa, Inc.: Form 10-Q for the period ended Jun 30, 2026

Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to provide a reader of our financial statements with a narrative from the perspective of our management on our financial condition, results of operations, liquidity, and certain other factors that may affect our future results. Our MD&A is presented in the following sections:

• Company Overview
• Market Outlook
• Executive Overview
• Results of Operations
• Liquidity and Capital Resources
• Recent Accounting Pronouncements
• Forward-Looking Statements

Our MD&A should be read in conjunction with the Consolidated Financial Statements of Arcosa, Inc. and its consolidated subsidiaries (“Arcosa,” “Company,” “we,” or “our”) and related Notes in Part I, Item 1 of this Quarterly Report on Form 10-Q and the Consolidated Financial Statements and related Notes in Item 8, “Financial Statements and Supplementary Data”, of our Annual Report on Form 10-K for the year ended December 31, 2025 (“2025 Annual Report on Form 10-K”).

Company Overview

Arcosa, headquartered in Dallas, Texas, is a provider of infrastructure-related products and solutions with leading positions in construction materials and engineered structures markets in North America. Arcosa is a Delaware corporation and was incorporated in 2018.

Market Outlook

• Within our Construction Products segment, market demand remains healthy overall when seasonal weather conditions have been normal, supported by infrastructure spending and private non-residential activity. The outlook for single-family residential housing continues to be impacted by higher interest rates and home affordability, which has negatively impacted volumes.
• Within our Engineered Structures segment, our backlog for utility and related structures as of June 30, 2026 was $648.1 million, up 49% year to date, and provides strong production visibility for the remainder of 2026. In utility structures, order and inquiry activity continues to be very healthy, as customers remain focused on grid hardening and reliability initiatives, along with increasing demand for electricity stemming from AI-driven projects. Due to increased demand, we have converted an idled wind tower facility to utility structures, which began delivering utility poles in the second quarter. Additionally, we plan to convert one of our existing wind tower facilities to utility structures in 2027.
• For our wind towers business, market demand has historically been impacted by the level of federal tax credits available. The One Big Beautiful Bill Act ("OBBBA"), which was enacted on July 4, 2025, terminates the AMP tax credit for wind towers sold after 2027. Also, under the OBBBA, wind farm projects that began construction after July 4, 2026, and are not placed in service before the end of 2027, will not be eligible for the Production Tax Credit ("PTC"). Notwithstanding these developments, we remain confident that further investment in wind energy is needed to meet the load growth demands in the U.S. As of June 30, 2026, our backlog for wind towers was $537.4 million and we expect to recognize 28% during the remainder of 2026.

Executive Overview

Recent Developments

On June 21, 2026, the Company entered into an Agreement and Plan of Merger (the "Merger Agreement") by and among the Company, CRH Americas, Inc., a Delaware corporation ("CRH"), and Neon Merger Sub, Inc., a Delaware Corporation and a wholly owned subsidiary of CRH ("Merger Sub"). Pursuant to the Merger Agreement, and subject to the terms and conditions set forth therein, Merger Sub will merge with and into the Company (the “Merger”), with the Company surviving the Merger as a wholly owned subsidiary of CRH. On the terms and subject to the conditions set forth in the Merger Agreement, at the effective time of the Merger ("Effective Time"), each share of Company common stock, par value $0.01 per share, issued and outstanding immediately prior to the Effective Time will be automatically converted into the right to receive $150.00 in cash, without interest and subject to applicable withholding taxes (the “Merger Consideration”).

The consummation of the Merger is subject to the satisfaction or waiver of customary closing conditions, set forth in the Merger Agreement, among other things, including approval by the Company's stockholders and the receipt of required regulatory approvals. If the Merger is consummated, the Company's common stock will be delisted from the New York Stock Exchange and NYSE Texas and deregistered under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The transaction is expected to close in the first quarter of 2027. See Note 1. "Overview and Summary of Significant Accounting Policies" to the Consolidated Financial Statements for additional information about the Merger.

On April 1, 2026, the Company completed the sale of its barge business to an affiliate of Wynnchurch Capital, L.P., for $450 million. Net cash proceeds received at closing were approximately $429.9 million, along with a receivable of $10 million related to escrow, after transaction closing costs. In April 2026, the Company used $83.0 million of the cash proceeds to prepay a portion of the outstanding 2025 Refinancing Term Loan. The sale resulted in a pre-tax gain of $359.7 million, which is presented within income from discontinued operations, net of income taxes on the Consolidated Statements of Operations. Previously reported in the Transportation Products segment, the barge business is a leading manufacturer of inland barges, fiberglass barge covers, winches, and marine hardware located along the U.S. inland river systems. The results of operations and cash flows for the three and six months ended June 30, 2026 have been classified as discontinued operations. Results of prior periods have been recast to reflect these changes and present results on a comparable basis. Since there are no remaining operations, the Transportation Products segment is no longer presented as a reportable segment. Unless indicated otherwise, the information in MD&A relates to the Company's continuing operations.

Financial Operations and Highlights

• Revenues for the three and six months ended June 30, 2026 increased by 1.7% and 3.0% to $658.7 million and $1,230.4 million, respectively, from the same periods in 2025.
• Operating profit for the three and six months ended June 30, 2026 increased by $2.3 million and $8.4 million, respectively, to $84.3 million and $131.4 million, respectively, compared to the same periods in 2025.
• Selling, general, and administrative expenses increased by 27.3% and 17.0% for the three and six months ended June 30, 2026, respectively, compared to the same periods in the prior year, driven by higher acquisition and divestiture-related expenses, including those related to the proposed Merger, and compensation-related costs. As a percentage of revenues, selling, general, and administrative expenses were 13.5% and 13.4% for the three and six months ended June 30, 2026, respectively, compared to 10.8% and 11.8% for the same periods in 2025, respectively.
• Interest expense for the three and six months ended June 30, 2026 totaled $23.1 million and $47.1 million, respectively, a decrease of $5.4 million and $9.7 million, respectively, from the same period in 2025.
• The effective tax rate from continuing operations for the three and six months ended June 30, 2026 was 18.3% and 14.6%, respectively, compared to 11.4% and 13.0%, respectively, for the same periods in 2025.
• Net income from continuing operations for the three and six months ended June 30, 2026 was $50.9 million and $74.2 million, respectively, compared to $50.5 million and $62.1 million, respectively, for the same periods in 2025.

Our Engineered Structures segment operates in cyclical industries. Additionally, results in our Construction Products segment are affected by weather and seasonal fluctuations with the second and third quarters historically being the quarters with the highest revenues.

Unsatisfied Performance Obligations (Backlog)

As of June 30, 2026, December 31, 2025, and June 30, 2025, our unsatisfied performance obligations, or backlog, were as follows:

(in millions)

In our Engineered Structures segment, 71% of the unsatisfied performance obligations for our utility and related structures are expected to be recognized during 2026, 20% are expected to be recognized in 2027, with the remainder expected to be recognized through 2029. For our wind towers business, 28% of the unsatisfied performance obligations for wind towers are expected to be recognized during 2026, 66% are expected to be recognized in 2027, with the remainder expected to be recognized in 2028.

Results of Operations

Overall Summary

Revenues

(in millions)

(in millions)

2026 versus 2025

• Revenues increased by 1.7% and 3.0% during the three and six months ended June 30, 2026, respectively.
• Revenues from Construction Products increased slightly primarily due to higher revenues in our trench shoring business.
• Revenues from Engineered Structures increased due to higher revenues in our utility structures business, partially offset by lower revenues in our wind towers, telecom and lighting businesses.

Operating Costs

(in millions)

(in millions)

(1) Depreciation, depletion, and amortization are included within operating profit and allocated between cost of revenues and selling, general, and administrative expenses depending on whether the underlying assets contribute to the production of revenue.

2026 versus 2025

• Operating costs increased by 1.6% and 2.5% during the three and six months ended June 30, 2026, respectively.
• Operating costs for Construction Products increased primarily due to increased trench shoring volumes and higher costs in specialty materials and asphalt.
• Operating costs for Engineered Structures decreased slightly as higher volume-related costs in utility structures were largely offset by lower volume-related costs in wind towers.
• Depreciation, depletion, and amortization expense increased primarily due to recent capital investments and acquisitions.
• Corporate costs increased by 72.6% and 43.6% for the three and six months ended June 30, 2026, compared to the same periods in the prior year, primarily due to higher acquisition and divestiture-related expenses. As a percentage of revenues, corporate costs were 5.0% and 4.1% for the three and six months ended June 30, 2026, respectively, compared to 2.9% for each of the same periods in 2025.

Operating Profit (Loss)

(in millions)

(in millions)

2026 versus 2025

• Operating profit increased 2.8% and 6.8% for the three and six months ended June 30, 2026, respectively.
• Operating profit in Construction Products decreased primarily due to lower volumes and reduced cost absorption in specialty materials and asphalt, partially offset by improved profitability in aggregates and trench shoring.
• Operating profit in Engineered Structures increased primarily due to higher volumes and improved profitability in utility structures, partially offset by the expected decline in wind tower volumes.
• The increase in operating profit was partially offset due to higher corporate costs resulting from increased acquisition and divestiture-related expenses.

For further discussion of revenues, costs, and the operating results of individual segments, see Segment Discussion below.

Income Taxes

The provision for income taxes results in effective tax rates that differ from the statutory rates. The Company's effective tax rate for continuing operations for the three and six months ended June 30, 2026 was 18.3% and 14.6%, respectively, compared to 11.4% and 13.0%, respectively, for the same periods in 2025. The change in the tax rate for the three and six months ended June 30, 2026 was primarily due to a reduction in AMP tax credits due to lower wind tower volumes and an increase in foreign taxes, partially offset by lower state taxes. For the three months ended June 30, 2026, the tax rate was also impacted by a lower compensation-related benefit in the current period due to a change in the timing of restricted stock vestings.

Our effective tax rate differs from the federal tax rate of 21.0% due to AMP tax credits, state income taxes, statutory depletion deductions, compensation-related items, and other foreign adjustments. See Note 9. "Income Taxes" to the Consolidated Financial Statements for further discussion of income taxes.

Segment Discussion

Construction Products

($ in millions)

($ in millions)

(1) Depreciation, depletion, and amortization are included within operating profit and allocated between cost of revenues and selling, general, and administrative expenses depending on whether the underlying assets contribute to the production of revenue.

Three Months Ended June 30, 2026 versus Three Months Ended June 30, 2025

• Segment revenues increased 0.7%. For construction materials, revenues decreased 1.3% primarily due to lower organic aggregates and asphalt volumes which were impacted by wet weather during the period. This decline was partially offset by higher pricing and the contribution from recent acquisitions. Revenues from construction site support increased 17.6% primarily due to higher volumes from our trench shoring business.
• Cost of revenues increased 2.3% primarily due to higher trench shoring volumes, the contribution from recent acquisitions, and increased costs in our specialty and asphalt businesses, partially offset by reduced costs in our organic aggregates business. As a percentage of revenues, cost of revenues were 77.4% in the current period, compared to 76.2% in the prior period.
• Selling, general, and administrative expenses increased 9.2% primarily due to higher compensation-related expenses and an increase in bad debt expense driven by a favorable adjustment recognized in the prior period related to increased collections on previously reserved receivables. Selling, general, and administrative expenses as a percentage of revenues were 9.3% in the current period, compared to 8.5% in the prior period.
• Operating profit decreased 6.0% primarily due to lower asphalt volumes and less favorable project mix in our asphalt paving business and higher depreciation, depletion, and amortization expense, partially offset by improved profitability in aggregates and trench shoring.
• Depreciation, depletion, and amortization expense increased 8.1%, outpacing revenue growth, primarily due to capital investments and recent acquisitions, including the fair market value write-up of long-lived assets.

Six Months Ended June 30, 2026 versus Six Months Ended June 30, 2025

• Segment revenues increased 2.6%. For construction materials, revenues increased slightly primarily due to higher pricing and the contribution from recent acquisitions, partially offset by lower volumes in our asphalt business, which was impacted by adverse weather. Revenues from construction site support increased 21.4% due to higher volumes from our trench shoring business.
• Cost of revenues increased 4.0% primarily due to higher trench shoring volumes and lower cost absorption in specialty materials and asphalt. As a percentage of revenues, cost of revenues were 80.0% in the current period, compared to 78.9% in the prior period.
• Selling, general, and administrative expenses increased 8.3% primarily due to higher compensation-related expenses and an increase in bad debt expense driven by a favorable adjustment recognized in the prior period related to increased collections on previously reserved receivables. Selling, general, and administrative expenses as a percentage of revenues were 10.5% in the current period, compared to 10.0% in the prior period.
• Operating profit decreased 9.0% primarily due to lower volumes and reduced cost absorption in specialty materials and asphalt and higher depreciation, depletion, and amortization expense, partially offset by improved profitability in aggregates and trench shoring.
• Depreciation, depletion, and amortization expense increased 6.5% primarily due to capital investments and recent acquisitions, including the fair market value write-up of long-lived assets.

Engineered Structures

($ in millions)

($ in millions)

(1) Depreciation, depletion, and amortization are included within operating profit and allocated between cost of revenues and selling, general, and administrative expenses depending on whether the underlying assets contribute to the production of revenue.

Three Months Ended June 30, 2026 versus Three Months Ended June 30, 2025

• Segment revenues increased 3.0%. Revenues for our utility and related structures businesses increased 12.4% primarily due to higher volumes and pricing in our utility structures business, partially offset by lower lighting and telecom volumes. Revenues for our wind towers business decreased 19.0% primarily due to lower volume.
• Cost of revenues were substantially unchanged as higher utility structures volumes were offset by lower volumes in our other businesses. As a percentage of revenues, cost of revenues were 75.2% in the current period, compared to 77.5% in the prior period.
• Selling, general, and administrative expenses increased 8.1% primarily due to higher compensation-related expenses for utility structures. Selling, general, and administrative expenses as a percentage of revenues were 8.4% in the current period, compared to 8.0% in the prior period.
• In the current period, other operating income was driven primarily by the gain recognized on the sale of a parcel of undeveloped industrial land located in Mexico.
• Operating profit increased 46.2% primarily due to higher volumes and improved profitability in utility structures and the gain recognized on asset sales, partially offset by the expected decline in wind tower volumes.

Six Months Ended June 30, 2026 versus Six Months Ended June 30, 2025

• Segment revenues increased 3.3%. Revenues for our utility and related structures businesses increased 13.7% primarily due to higher volumes and pricing in our utility structures business, partially offset by lower lighting and telecom volumes. Revenue for wind towers declined 20.2%, primarily due to lower volume.
• Cost of revenues decreased slightly as lower wind tower volumes were mostly offset by higher utility structures volume. As a percentage of revenues, cost of revenues were 74.9% in the current period, compared to 77.8% in the prior period.
• Selling, general, and administrative expenses increased 6.8% primarily due to higher compensation-related expenses for utility structures. Selling, general, and administrative expenses as a percentage of revenues were 8.4% in the current period, compared to 8.1% in the prior period.
• In the current period, other operating income was driven primarily by the gain recognized on the sale of a parcel of undeveloped industrial land located in Mexico.
• Operating profit increased 37.7% primarily due to higher volumes and improved profitability in utility structures and the gain recognized on asset sales, partially offset by the expected decline in wind tower volumes.

Unsatisfied Performance Obligations (Backlog)

As of June 30, 2026, the backlog for utility and related structures was $648.1 million compared to $434.9 million and $450.0 million as of December 31, 2025 and June 30, 2025, respectively. We expect to recognize 71% of the unsatisfied performance obligations for utility and related structures during 2026, 20% are expected to be recognized in 2027, with the remainder expected to be recognized through 2029.

The backlog for wind towers as of June 30, 2026 was $537.4 million compared to $627.8 million and $598.6 million as of December 31, 2025 and June 30, 2025, respectively. We expect to recognize 28% of the unsatisfied performance obligations for wind towers during 2026, 66% are expected to be recognized in 2027, with the remainder expected to be recognized in 2028.

Corporate

(in millions)

(in millions)

Three Months Ended June 30, 2026 versus Three Months Ended June 30, 2025

• Corporate selling, general, and administrative expenses increased 88.9% primarily due to higher acquisition and divestiture-related expenses of $14.5 million, compared to $0.5 million for the same period in 2025, and higher compensation-related expenses.
• Other operating expense reflects the loss recognized on the change in the estimated fair value of the earnout on the steel components business, which was sold in 2024.

Six Months Ended June 30, 2026 versus Six Months Ended June 30, 2025

• Corporate selling, general, and administrative expenses increased 47.9% primarily due to higher acquisition and divestiture-related expenses of $16.4 million, compared to $1.3 million for the same period in 2025.
• Other operating expense reflects the loss recognized on the change in the estimated fair value of the earnout on the steel components business, which was sold in 2024.

Liquidity and Capital Resources

Arcosa’s primary liquidity requirement consists of funding our business operations, including operating expenses, capital expenditures, working capital investment, quarterly debt payments, and our regular quarterly dividend. Our primary sources of liquidity include cash flow from operations, our existing cash balance, availability under the revolving credit facility, and, as necessary, the issuance of additional long-term debt or equity. We may also consider undertaking disciplined acquisitions, organic investment projects, additional return of capital to stockholders, or funding other general corporate purposes to the extent we have available liquidity.

Cash Flows

The following table summarizes our cash flows from continuing operations from operating, investing, and financing activities for the six months ended June 30, 2026 and 2025:

(in millions)

Operating Activities from Continuing Operations. Net cash provided by operating activities for the six months ended June 30, 2026 was $33.4 million, compared to $16.9 million of net cash provided by operating activities for the six months ended June 30, 2025.

• The changes in current assets and liabilities resulted in a net use of cash of $166.3 million for the six months ended June 30, 2026, compared to a net use of cash of $163.7 million for the six months ended June 30, 2025. The current year activity was primarily driven by increases in receivables, inventories, and a decrease in accrued liabilities.

Investing Activities from Continuing Operations. Net cash required by investing activities for the six months ended June 30, 2026 was $147.9 million, compared to $31.6 million for the six months ended June 30, 2025.

• Capital expenditures for the six months ended June 30, 2026 were $102.3 million, compared to $60.0 million for the same period last year.
• Proceeds from the sale of property, plant, and equipment totaled $39.1 million for the six months ended June 30, 2026, compared to $10.8 million for the same period in 2025.
• For the six months ended June 30, 2026, cash paid for acquisitions was $84.7 million, compared to cash received from acquisitions of $17.6 million during the same period in 2025.

Financing Activities from Continuing Operations. Net cash required by financing activities during the six months ended June 30, 2026 was $123.8 million, compared to net cash required by financing activities of $24.7 million for the same period in 2025.

• Current year activity was driven by debt payments, amounts paid to repurchase common stock under the share repurchase program, shares purchased to satisfy employee taxes on vested stock, and dividends paid during the period.

Other Investing and Financing Activities

Revolving Credit Facility, Term Loan, and Senior Notes

In August 2023, we entered into the Credit Agreement to increase our revolving credit facility from $500.0 million to $600.0 million, extend the maturity date of our revolving credit facility from January 2, 2025 to August 23, 2028, and refinance and repay in full the remaining balance of the term loan then outstanding under our prior credit facility.

On August 15, 2024, we entered into Amendment No. 1 to the Credit Agreement to, among other things, (i) increase our revolving credit facility from $600.0 million to $700.0 million, (ii) collateralize the amended revolving credit facility with substantially all of our and our subsidiary guarantors' personal property (with certain exceptions), (iii) make the applicable margin for revolving borrowings, letters of credit and the commitment fee rate be based on our consolidated net leverage ratio (permitting up to $150.0 million of unrestricted cash to be netted from the calculation thereof), (iv) modify the margin for SOFR-based revolving borrowings and letters of credit to range from 1.25% to 2.50% per annum, (v) modify the margin for base rate revolving borrowings to range from 0.25% to 1.50%, (vi) modify the commitment fee that accrues on the unused portion of the revolving credit facility to range from 0.20% to 0.45%, and (vii) modify the maximum permitted leverage ratio to include a net debt concept (permitting up to $150.0 million of unrestricted cash to be netted from the calculation thereof), and to provide that such ratio shall be no greater than 4.00 to 1.00 during the first quarter of 2026, and for each fiscal quarter thereafter (however, this maximum permitted leverage ratio may be increased to 4.50 to 1.00 for up to four fiscal quarters if a material acquisition is entered into). These amendments became effective on October 1, 2024. The amended revolving credit facility's maturity date of August 23, 2028 remains unchanged.

As of June 30, 2026, we had no outstanding loans borrowed under our revolving credit facility.

The interest rates for revolving loans under the Credit Agreement are variable based on the daily simple or term SOFR, plus a 10-basis point credit spread adjustment, or an alternate base rate, in each case plus a margin for borrowing. A commitment fee accrues on the average daily unused portion of the revolving credit facility. The margin for revolving borrowings and commitment fee rate are determined based on the Company’s consolidated total net leverage ratio (as measured by a consolidated funded indebtedness, less the aggregate amount of unrestricted cash up to a maximum amount not to exceed $150.0 million, to consolidated EBITDA ratio). As of June 30, 2026, the margin for borrowing based on SOFR was set at 1.75% and the commitment fee rate was set at 0.30%.

The revolving credit facility portion of the Credit Agreement requires the maintenance of certain ratios related to leverage and interest coverage. As of June 30, 2026, we were in compliance with all such financial covenants. Borrowings under the Credit Agreement are guaranteed by certain domestic subsidiaries of the Company. On October 1, 2024, we collateralized our obligations under the Credit Agreement with substantially all of our and our subsidiary guarantors' personal property (with certain exceptions).

On June 17, 2025, we entered into Amendment No. 2 to the Credit Agreement, which established a new class of term loans, the 2025 Refinancing Term Loan in an aggregate principal amount of $698.3 million. We used the 2025 Refinancing Term Loan's net proceeds, together with cash on hand, to satisfy the outstanding balance under the 2024 Term Loan. The 2025 Refinancing Term Loan requires, among other things, (i) mandatory prepayments from excess cash flow on an annual basis, commencing with the fiscal year ending December 31, 2025, (ii) mandatory prepayments with proceeds of certain asset sales and debt issuances, and (iii) quarterly principal amortization payments in an amount equal to 0.25% of the 2024 Term Loan. The 2025 Refinancing Term Loan has a maturity date of October 1, 2031. The interest rate for the 2025 Refinancing Term Loan is based on SOFR plus 2.00% per year, or an alternate base rate, plus 1.00% per year. If the 2025 Refinancing Term Loan is prepaid in connection with a repricing transaction or we effect any amendment to the Credit Agreement resulting in a repricing transaction, in either case within six months after the initial funding of the 2025 Refinancing Term Loan, there is a 1.0% premium on such prepaid amount or on the amount outstanding at the time such repricing transaction amendment becomes effective. Otherwise, the 2025 Refinancing Term Loan is prepayable at any time without premium or penalty (other than customary SOFR-related breakage costs). The 2025 Refinancing Term Loan is guaranteed by the same subsidiaries of the Company that guarantee our revolving credit facility, and the 2025 Refinancing Term Loan is secured on a pari passu basis with our revolving credit facility. In April 2026, the Company used $83 million of cash proceeds from the sale of the barge business to prepay a portion of the outstanding 2025 Refinancing Term Loan. See Note 2. "Acquisitions and Divestitures" for additional information.

On August 26, 2024, the Company issued $600.0 million aggregate principal amount of 6.875% senior unsecured notes (the "2024 Notes") that mature in August 2032. Interest on the 2024 Notes is payable semiannually in February and August. In April 2021, the Company issued $400.0 million aggregate principal amount of 4.375% senior unsecured notes (the "2021 Notes", and together with the 2024 Notes, the "Senior Notes") that mature in April 2029. Interest on the 2021 Notes is payable semiannually in April and October. The Senior Notes are senior unsecured obligations of the Company and are guaranteed on a senior unsecured basis by each of the Company’s domestic subsidiaries that is a guarantor under our Credit Agreement. The terms of each indenture governing the Senior Notes, among other things, limit the ability of the Company and each of its subsidiaries to create liens on assets, enter into sale and leaseback transactions, and consolidate, merge or transfer all or substantially all of its assets and the assets of its subsidiaries. The terms of each indenture also limit the ability of the Company’s non-guarantor subsidiaries to incur certain types of debt.

We believe, based on our current business plans, that our existing cash, available liquidity, and cash flow from operations will be sufficient to fund necessary capital expenditures and operating cash requirements for the foreseeable future.

Dividends and Repurchase Program

In May 2026, the Company declared a quarterly cash dividend of $0.05 per share that was paid on July 31, 2026.

In December 2024, the Board authorized a $50.0 million share repurchase program effective January 1, 2025 through December 31, 2026 to replace an expiring program of the same amount. During the three months ended June 30, 2026, the Company did not repurchase any shares. During the six months ended June 30, 2026, the Company repurchased 159,595 shares at a cost of $17.5 million. As of June 30, 2026, the Company has approximately $32.5 million available for share repurchases under the current program. See Note 1. "Overview and Summary of Significant Accounting Policies" to the Consolidated Financial Statements.

Recent Accounting Pronouncements

See Note 1. "Overview and Summary of Significant Accounting Policies" to the Consolidated Financial Statements for information about recent accounting pronouncements.

Forward-Looking Statements

This Quarterly Report on Form 10-Q (or statements otherwise made by the Company or on the Company's behalf from time to time in other reports, filings with the SEC, news releases, conferences, internet postings, or otherwise) contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any statements contained herein that are not historical facts are forward-looking statements and involve risks and uncertainties. These forward-looking statements include expectations, beliefs, plans, objectives, future financial performances, estimates, projections, goals, and forecasts. Arcosa uses the words “anticipates,” “assumes,” “believes,” “estimates,” “expects,” “intends,” “forecasts,” “may,” “will,” “should,” “plans,” and similar expressions to identify these forward-looking statements. Potential factors, which could cause our actual results of operations to differ materially from those in the forward-looking statements include, among others:

• the ability to complete the Merger on the proposed terms or on the anticipated timeline, or at all;
• the ability to secure the required regulatory and stockholder approvals and the satisfaction of other closing conditions to consummate the Merger;
• the occurrence of any event, change or other circumstance that could give rise to the termination of the Merger Agreement;
• significant transaction costs and/or unknown or inestimable liabilities related to the Merger;
• the risk of stockholder litigation in connection with the Merger, including resulting expense or delay;
• CRH’s ability to obtain the necessary financing to consummate the Merger;
• effects of the Merger on the market price of our common stock;
• effects of the pendency of the Merger on the Company’s ability to maintain current operations, including disruption to relationships with customers, suppliers and other third parties, diversion of management’s attention from day-to-day operations and the ability to retain and hire key personnel and other employees;
• restrictions and limitations placed on the Company’s ability to operate its business under the Merger Agreement;
• the occurrence of any event that could give rise to the termination of the Merger Agreement, including under circumstances that require the Company to pay CRH a termination fee;
• restrictions or closures of critical supply routes such as the Strait of Hormuz;
• the impact of pandemics, epidemics, or other public health emergencies on our sales, operations, supply chain, employees, and financial condition;
• market conditions and customer demand for our business products and services;
• the cyclical and seasonal nature of the industries in which we compete;
• variations in weather in areas where our construction products are sold, used, or installed;
• naturally occurring events and other events and disasters causing disruption to our manufacturing, product deliveries, and production capacity, thereby giving rise to an increase in expenses, loss of revenue, and property losses;
• competition and other competitive factors;
• our ability to identify, consummate, or integrate acquisitions of new businesses or products, or divest any business;
• the timing of introduction of new products;
• the timing and delivery of customer orders or a breach of customer contracts;
• the credit worthiness of customers and their access to capital;
• product price changes;
• changes in mix of products sold;
• the costs incurred to align manufacturing capacity with demand and the extent of its utilization;
• the operating leverage and efficiencies that can be achieved by our manufacturing businesses;
• availability and costs of steel, component parts, supplies, and other raw materials;
• changing technologies;
• adoption and use of AI and machine learning technology;
• surcharges and other fees added to fixed pricing agreements for steel, component parts, supplies and other raw materials;
• increased costs due to inflation or tariffs;
• interest rates and capital costs;
• counter-party risks for financial instruments;
• our indebtedness or leverage levels;
• long-term funding of our operations;
• taxes;
• costs and availability of sufficient insurance coverage;
• material nonpayment or nonperformance by any of our key customers;
• the stability of the governments and political and business conditions in certain foreign countries, particularly Mexico;
• public infrastructure expenditures;
• changes in import and export quotas and regulations;
• business conditions in emerging economies;
• costs and results of litigation;
• changes in accounting standards or inaccurate estimates or assumptions in the application of accounting policies;
• legal, regulatory, and environmental issues, including compliance of our products with mandated specifications, standards, or testing criteria and obligations to remove and replace our products following installation or to recall our products and install different products manufactured by us or our competitors;
• actions by the executive and legislative branches of the U.S. government relative to federal government budgeting, taxation policies, government expenditures, U.S. borrowing/debt ceiling limits, and trade policies, including tariffs, and border closures;
• our ability to sufficiently protect our intellectual property rights;
• our ability to mitigate against cybersecurity incidents, including ransomware, malware, phishing emails, and other electronic security threats;
• if the Company's sustainability efforts are not favorably received by stockholders;
• if the Company does not realize some or all of the benefits expected from certain provisions of the IRA, including due to the modification or termination of the AMP tax credits for wind towers and due to changes in demand for wind towers resulting from modifications in tax incentives;
• costs and challenges in expanding existing business and identifying new organic growth opportunities; and
• the delivery or satisfaction of any backlog or firm orders.

Any forward-looking statement speaks only as of the date on which such statement is made. Arcosa undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made. For a discussion of risks and uncertainties that could cause actual results to differ from those contained in the forward-looking statements, see Item 1A, “Risk Factors” of this Report and our 2025 Annual Report on Form 10-K and future Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.

There has been no material change in our market risks since December 31, 2025 as set forth in our 2025 Annual Report on Form 10-K. The impact of such market risk exposures as a result of foreign exchange rate fluctuations has not been significant to Arcosa.

Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures designed to ensure that it is able to collect and record the information it is required to disclose in the reports it files or submits under the Securities Exchange Act of 1934 (the “Exchange Act”) with the Securities and Exchange Commission (“SEC”), to process, summarize, and disclose this information within the time periods specified in the rules of the SEC, and that such information is accumulated and communicated to management, including our Chief Executive and Chief Financial Officers, in a timely fashion. The Company’s Chief Executive and Chief Financial Officers are responsible for establishing and maintaining these disclosure controls and procedures and evaluating their effectiveness (as defined in Rule 13(a)-15(e) under the Exchange Act). Based on their evaluation of the Company’s disclosure controls and procedures that took place as of the end of the period covered by this report, the Chief Executive and Chief Financial Officers believe that these disclosure controls and procedures were effective.

Changes in Internal Control over Financial Reporting

During the period covered by this report, there have been no changes in the Company’s internal control over financial reporting that have materially affected or are reasonably likely to materially affect the Company’s internal control over financial reporting.

There have been no material changes in the Company's risk factors from those set forth in our 2025 Annual Report on Form 10-K other than those included below related to the potential Merger. Readers should carefully consider the factors discussed in "Risk Factors" in Item 1A of Part 1 of the 2025 Annual Report on Form 10-K, which could materially harm its business, liquidity and financial condition, results of operations, or stock price, including causing its actual results to differ materially from those projected in any forward-looking statements. The following list of material risk factors is not all-inclusive or necessarily in order of importance. Additional risks and uncertainties not presently known to Arcosa or that it currently deems immaterial also may materially adversely affect it in future periods.

The announcement and pendency of the Merger Agreement could have an adverse effect on our business.

On June 21, 2026, we entered into an Agreement and Plan of Merger (as it may be amended, supplemented or otherwise modified in accordance with its terms, the “Merger Agreement”) with CRH Americas, Inc., a Delaware corporation (“CRH”), and Neon Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of CRH (“Merger Sub”), pursuant to which, upon the terms and subject to the conditions set forth in the Merger Agreement, Merger Sub will merge with and into the Company, with the Company surviving the Merger and becoming a wholly owned subsidiary of CRH (the “Merger”).

On August 3, 2026, the Company filed a definitive proxy statement (the "Proxy Statement") with the SEC. The Proxy Statement was first mailed to stockholders of the Company on or about August 4, 2026, which included the notice of the special meeting date on September 4, 2026 to consider the Company Stockholder approval. Upon the terms and subject to the conditions set forth in the Merger Agreement, at the effective time of the Merger, except as otherwise provided in the Merger Agreement, each share of our common stock issued and outstanding immediately prior to the effective time of the Merger will be canceled and automatically converted into the right to receive $150.00 in cash, without interest, less any applicable withholding taxes.

Uncertainty about the effect of the proposed Merger on our employees, customers, and suppliers may have an adverse effect on our business and operations that may be material to our company. There may be adverse effects on our ability to attract, recruit, retain and motivate current and prospective employees who may be uncertain about their future roles following completion of the Merger, and the possibility that our employees could lose productivity as a result of the uncertainty regarding their employment following the Merger. Any loss or distraction of such employees could have an adverse effect on our business and operations. In addition, we have diverted, and will continue to divert, significant management attention and resources towards the completion of the Merger, which could adversely affect our business and operations.

Our customers may experience uncertainty associated with the Merger, including with respect to concerns about possible changes to our products, services or policies. Similarly, our suppliers may experience uncertainty associated with the Merger, including with respect to current or future business relationships with us. Uncertainty may cause customers to refrain from purchasing our products and services, and suppliers may seek to change existing business relationships, which could result in an adverse effect on our business, operations, and financial condition in a way that may be material to our company.

Pursuant to the terms of the Merger Agreement, we are subject to certain restrictions on the conduct of our business, including the ability in certain cases to enter into contracts, acquire or dispose of assets, incur indebtedness, or incur capital expenditures, until the Merger becomes effective or the Merger Agreement is terminated. These restrictions may prevent us from taking actions with respect to our business that we may consider advantageous and result in our inability to respond effectively to competitive pressures and industry developments, and may otherwise harm our business and operations.

The Merger is subject to receipt of approval from our stockholders as well as the satisfaction of other closing conditions in the Merger Agreement.

The Merger Agreement contains a number of customary conditions to complete the Merger, including, (1) the adoption of the Merger Agreement by the affirmative vote of the holders of a majority of the outstanding shares of common stock entitled to vote at the special meeting, (2) the absence of any law, order or injunction restraining, enjoining or otherwise prohibiting the Merger, (3) (i) the expiration or termination of any applicable waiting period (and any extensions thereof) applicable to (a) the transactions contemplated by the merger agreement, including the merger, under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and (b) any agreement between a governmental entity, on the one hand, and the Company and CRH, on the other hand, prohibiting the consummation of the transactions contemplated by the Merger Agreement, including the Merger, and (ii) the receipt or waiver of the governmental approvals required under the regulatory laws of the required jurisdictions specified in the Merger Agreement, or the lapse, waiver or termination of any applicable waiting or other time periods relating thereto, (4) subject to certain exceptions and materiality qualifiers, the accuracy of each party’s representations and warranties, (5) the absence of a material adverse effect with respect to the Company, and (6) performance in all material respects by each party of its obligations, covenants and agreements required to be performed under the Merger Agreement before the effective time.

We can provide no assurance that all required approvals will be obtained or that all closing conditions will be satisfied, and, if all required approvals are obtained and the closing conditions are satisfied, we can provide no assurance as to the terms, conditions and timing of such approvals or the timing of the completion of the Merger. Any delay in completing the Merger could cause us not to realize some or all of the benefits that we expect to achieve if the Merger is successfully completed within its expected timeframe.

The failure to complete the Merger could adversely affect our business, financial condition, operating results, and stock price.

Completion of the Merger is subject to certain conditions beyond our control that may prevent, delay, or otherwise adversely affect its completion in a material way, including the expiration or termination of applicable waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”), and similar competition approvals or consents that must be obtained from regulatory entities. In addition to the expiration or termination of the waiting period under the HSR Act, the completion of the merger is also conditioned on the receipt of certain approvals or clearances (or the expiration or termination of applicable waiting or review periods) under the antitrust laws of Australia and Mexico and, if applicable, approval or the expiration, waiver or termination of the relevant waiting period under the Investment Canada Act. The process to obtain regulatory approvals could substantially delay, or prevent, the consummation of the Merger. There can be no assurance that these conditions to the completion of the Merger will be satisfied in a timely manner or at all. If the Merger is not completed, our stock price could fall to the extent its current market price reflects an assumption that the Merger will be completed, and it is uncertain when, if ever, our stock price would return to the price at which our shares currently trade.

The Merger Agreement provides that, upon termination of the Merger Agreement by the Company or CRH in certain customary circumstances, including, among other things, termination by the Company prior to the Company obtaining stockholder approval and subsequent entry into a definitive agreement providing for a superior proposal, and termination by CRH prior to the Company obtaining stockholder approval due to a change of recommendation by the Board, a fee of $260.4 million will be payable by the Company to CRH.

Further, a failure to complete the Merger may result in negative publicity and a negative impression of us in the investment community and may necessitate us having to obtain additional financing, which may be unavailable on terms favorable to us, or at all. Any disruption to our business resulting from the announcement and pendency of the Merger and from intensifying competition from our competitors, including any adverse changes in our relationships with our customers, suppliers, and employees could continue or accelerate in the event of a failure to complete the Merger. We may be subject to legal proceedings related to the transactions contemplated by the Merger Agreement. There can be no assurance that our business, these relationships, or our financial condition will not be adversely affected, as compared to the condition prior to the announcement of the Merger, if the Merger is not consummated.

The Merger Agreement contains provisions that limit our ability to pursue alternatives to the Merger and that could deter or discourage a competing acquirer from making a favorable alternative transaction proposal.

Under the Merger Agreement, we are subject to “no-shop” restrictions and are not permitted, subject to certain exceptions set forth in the Merger Agreement, to solicit, initiate, knowingly encourage or knowingly facilitate any inquiry, proposal or offer, or the making, submission or announcement of any inquiry, proposal or offer that constitutes or could be reasonably expected to lead to an acquisition proposal, or participate in any discussions or negotiations regarding or furnish to any person or entity any information relating to the Company or any of its subsidiaries, in each case, in connection with an acquisition proposal, other than to state that the Company and its representatives are prohibited thereunder from engaging in any discussions or negotiations. Further, our Board is required to recommend that our stockholders vote in favor of adoption of the Merger Agreement, subject to exceptions for superior proposals and certain intervening events, in each case where the Board determines in good faith, after consultation with outside legal counsel, that failure to take the applicable action would be reasonably likely to constitute a breach of the directors’ fiduciary duties under applicable law. Upon the termination of the Merger Agreement under specified circumstances, including, among others, the termination by CRH in the event of a change of recommendation by the Board prior to the Company obtaining stockholder approval, we would be required to pay CRH a termination fee of $260.4 million. Such provisions of the Merger Agreement could discourage or deter a third party that may be willing to pay more than CRH for our outstanding common stock from considering or proposing such an acquisition of the Company.

Lawsuits may arise in connection with the Merger, which could delay or prevent completion of the Merger and adversely affect our business, results of operations, cash flows and financial condition.

Lawsuits relating to the Merger could be filed against us and our directors and officers, including by our stockholders. Although litigation is common in connection with acquisitions of public companies, regardless of any merits related to the underlying acquisition, the outcome of any litigation cannot be assured and could delay or prevent completion of the Merger. Additionally, the amount of fees and costs of defense, including costs associated with the indemnification of directors and officers, and other liabilities that may be incurred in connection with lawsuits and other negative effects, such as diversion of resources from the Merger and ongoing business activities, negative publicity or damage to our relationships with business partners, suppliers and customers, could have a material adverse effect on our business, results of operations, cash flows and financial condition.

We have incurred and will incur a number of non-recurring costs associated with the proposed Merger.

We have incurred and expect to incur a number of non-recurring costs associated with the proposed Merger, for which we will receive little or no benefit if the proposed Merger is not completed. These costs include financial advisory, legal, accounting, consulting and other advisory fees, severance/employee benefit-related costs, financing-related fees and costs, public company filing fees and other regulatory fees, printing costs and other related costs. There are a number of factors beyond our control that could affect the total amount or the timing of these costs and expenses. Many of these costs are payable by us regardless of whether or not the proposed Merger is completed and may relate to activities that we would not have undertaken other than to complete the proposed Merger.