Quarterly Report for Quarter Ending September 30, 2026 (Form 10-Q)

Management's Discussion and Analysis of Financial Condition and Results of

Operations

The following discussion and analysis of our financial condition and results of operations should be read in

conjunction with our unaudited condensed consolidated financial statements and accompanying notes

included elsewhere in this Quarterly Report. Some of the information contained in the following discussion

and analysis includes forward-looking statements that involve risks and uncertainties. Refer to the sections

entitled "Cautionary Note Regarding Forward-Looking Statements" and "Risk Factors" in our 2025 Form 10-K

for a discussion of forward-looking statements and important factors that could cause actual results to differ

materially from the results described in or implied by the forward-looking statements contained in the

following discussion and analysis.

Overview

We are a building solutions company focused on the North American market, offering customers a broad

range of advanced building solutions from foundation to rooftop. We serve customers across the

infrastructure, commercial, and residential construction markets, from new builds to repair and refurbishment

("R&R"). Our more than 19,000 employees operate across more than 1,000 sites and facilities in the United

States, Canada, Colombia, Switzerland, and Jamaica, providing customers with trusted brands and advanced

building solutions for the full building lifecycle. Our trusted brands and advanced solutions, combined with our

operational expertise, make us a trusted partner for customers, consisting of contractors, building owners,

architects, engineers, public authorities, and cities across the United States and Canada.

We earn revenue from the sale of cement, aggregates, ready-mix concrete, asphalt, roofing systems, and

other building solutions. We operate in two reportable segments, offering a complete range of advanced

solutions to support large-scale and complex construction projects, such as bridges and data centers, in the

areas of residential, commercial, and infrastructure construction. Our services span new construction as well

as R&R, with R&R accounting for 43% of overall revenues in 2025.

•Our Building Materials segment offers a range of branded solutions delivering high-quality products

for a wide range of applications across North America. Key product offerings of this segment include

cement and aggregates, as well as a variety of downstream products and solutions such as ready-

mix concrete, asphalt, and other construction materials.

•Our Building Envelope segment offers advanced roofing and wall systems, including single-ply

membranes, insulation, shingles, sheathing, waterproofing and protective coatings, along with

adhesives, tapes, and sealants. Our Building Envelope products are sold individually or in warrantied

systems for new construction or R&R in commercial and residential projects. These products are sold

either directly to contractors or through an authorized distributor or dealer network in North America.

Seasonality

Our Building Materials segment operating results for the first and fourth quarters are generally lower than

those for the second and third quarters, which benefit from more favorable weather and increased

construction activity. In addition to impacting demand, adverse weather can disrupt production schedules,

shipments, and project timelines, affecting costs, efficiencies, and profitability. We manage these seasonal

fluctuations through operational planning and flexible workforce management, but quarter-to-quarter results

may not be indicative of full-year performance.

Our Building Envelope segment is subject to seasonal fluctuations in demand, primarily driven by trends in

new construction, renovation, and repair activities across both residential and commercial markets. Demand

for our building envelope products, which include roofing, wall systems, and related solutions, generally

increases during periods of favorable weather, as construction and renovation projects are most active in the

second and third calendar quarters. This pattern reflects the broader industry trend, where project starts and

completions are concentrated in the spring and summer months, particularly in our key geographic markets.

We continuously monitor market conditions and adjust our production and inventory management strategies

to align with anticipated seasonal demand and potential weather-related disruptions. Despite these efforts,

the inherent seasonality and unpredictability of weather events may result in fluctuations in our quarterly

revenues, earnings, and cash flow.

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Other Non-Operating Income, net

Other non-operating income, net primarily includes the amortization of actuarial gains or losses on pension

and other postretirement benefit plans, curtailment, and settlement gains or losses incurred in connection

with pension and other postretirement benefit plans.

Income Tax Expense

Income tax expense consists of federal, state, and local income taxes related to the tax jurisdictions in which

we conduct business. Income tax provision consists of taxes currently payable and deferred amounts related

to both Swiss and non-Swiss taxes on our income. The effective tax rate depends on a number of factors,

including the jurisdiction in which operating profit is earned and the nature and timing of discrete items.

Income from Equity Method Investments

Income from equity method investments primarily includes the results of our share of income from our equity

method investments.

Results of Operations

As discussed in "Management's Discussion and Analysis of Financial Condition and Results of Operations-

Overview-Factors Affecting Our Performance" and "Management's Discussion and Analysis of Financial

Condition and Results of Operations-Overview-Macroeconomic Trends" above, and as discussed in more

detail below, our results of operations are highly dependent upon activities within the construction industry,

economic cycles within the public and private business sectors, and seasonality. Accordingly, financial results

for any period presented, or period-to-period comparisons of reported results, may not be indicative of future

results of operations.

Our financial results for the three and nine months ended September 30, 2026 and 2025 were affected by

higher raw material and distribution costs. These factors are outside of our control and may impact our

operations in the future. The extent to which global economic challenges will ultimately impact our business,

operations, financial condition, and results of operations will depend on numerous factors, which are highly

uncertain, rapidly changing, and cannot be predicted.

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Selling, general and administrative expenses

In 2025, Selling, general and administrative expenses were primarily developed on a "carve-out" basis from

Holcim, as well as Spin-Off related costs. In 2026, this activity reflects the costs to operate a stand-alone

organization.

Selling, general and administrative expenses for the three months ended September 30, 2026 were $291

million, a decrease of $22 million, or 7.0%, from $313 million for the three months ended September 30, 2025.

The decrease for the three months ended September 30, 2026 was primarily due to higher litigation costs

incurred in the prior year.

Selling, general and administrative expenses for the nine months ended September 30, 2026 were $859

million, an increase of $17 million, or 2.0%, from $842 million for the nine months ended September 30, 2025.

The increase for the nine months ended September 30, 2026 primarily consists of organic growth from

personnel expenses for higher headcount and costs to operate on a stand-alone basis. PB Materials

contributed to inorganic growth. These factors were partially offset by litigation costs incurred in the prior

year.

Gain on disposal of long-lived assets

Gain on disposal of long-lived assets for the three and nine months ended September 30, 2026 was $3

million and $11 million, respectively, compared to $4 million and $9 million for the three and nine months

ended September 30, 2025, respectively.

Loss on impairments

Loss on impairments for the three and nine months ended September 30, 2026 and 2025 was immaterial.

Interest expense, net

Interest expense, net was $89 million for each of the three months ended September 30, 2026 and 2025 and

$256 million for the nine months ended September 30, 2026, a decrease of $72 million, or 22.0%, from $328

million, for the nine months ended September 30, 2025. The decrease in interest expense, net during the

year-to-date period was primarily driven by a decrease in related-party debt. Since the Spin-Off, the

Company has operated with a lower debt profile.

Other non-operating income, net

Other non-operating income, net was immaterial for the presented periods.

Income tax expense

Income tax expense for the three and nine months ended September 30, 2026 was $153 million and $258

million, respectively, a decrease of $5 million and an increase of $6 million, from $158 million and $252 million,

for the three and nine months ended September 30, 2025, respectively. The effective income tax rates for

the three and nine months ended September 30, 2026 were 21.7% and 21.9%, compared to 22.8% and 22.7%

for the three and nine months ended September 30, 2025. The 2026 effective income tax rate was primarily

impacted by a return-to-provision adjustment.

Income from equity method investments

Income from equity method investments for the three and nine months ended September 30, 2026 and 2025

was immaterial.

Net Income and Net Income Margin

Net income for the three months ended September 30, 2026 increased to $558 million from $540 million for

the three months ended September 30, 2025. The increase was driven by price increases, lower corporate

costs. These drivers were partially offset by lower volumes, higher operating costs, notably higher freight,

diesel and raw material costs, as well as higher depreciation, depletion, accretion and amortization expense.

Net income margin was 14.8% for the three months ended September 30, 2026, compared to 14.6% for the

three months ended September 30, 2025.

Net income for the nine months ended September 30, 2026 increased to $927 million from $862 million for

the nine months ended September 30, 2025. Net income was favorably impacted by the benefit from higher

volumes, aggregates price increases, and lower interest expense. These items were offset by higher

operating costs and higher depreciation, depletion, accretion and amortization expense. Net income margin

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Reconciliation of Non-GAAP Financial Measures

Total Segment Adjusted EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin, EBITDA and EBITDA Margin are

monitored by management in order to efficiently allocate resources between segments and to assess

performance. The table below reconciles our net income and net income margin, the most directly

comparable financial measures calculated in accordance with U.S. GAAP, to Total Segment Adjusted EBITDA,

Adjusted EBITDA, Adjusted EBITDA Margin, EBITDA, and EBITDA Margin, respectively.

		For the three months				For the nine months
		ended September 30,				ended September 30,
(In millions, except for percentage data)		2026		2025		2026		2025
Net income		$558		$540		$927		$862
Depreciation, depletion, accretion and amortization
Interest expense, net
Income tax expense
EBITDA		1,063		1,026		2,198		2,125
Acquisition and integration-related costs(1)				(2)
Litigation-related (settlements) costs(2)						(2)
Loss on impairments(3)		-		-
Restructuring and other costs(4)
Spin-off and separation-related costs(5)
Other non-operating income, net(6)		(2)		-		(3)		(2)
Income from equity method investments		(5)		(4)		(6)		(5)
Adjusted EBITDA		1,076		1,074		2,253		2,231
Unallocated corporate costs
Total Segment Adjusted EBITDA		$1,120		$1,126		$2,397		$2,385
Building Materials		$938		$913		$1,898		$1,799
Building Envelope		$182		$213		$499		$586
Net income margin		14.8%		14.6%		9.8%		9.6%
EBITDA Margin		28.2%		27.8%		23.3%		23.6%
Adjusted EBITDA Margin		28.5%		29.1%		23.9%		24.8%

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(1)Acquisition and integration-related costs are those incurred for business combinations (including advisory, legal, valuation, and other

professional fees) as well as the unfavorable effects of purchase accounting. Certain warranty charges related to pre-acquisition

manufacturing issues are also included.

(2)Litigation-related (settlements) costs include certain litigation settlements, environmental remediation, and legal-related consulting and

professional fees that are not representative of expenses arising in the ordinary course of business.

(3)Loss on impairments consists of one-time charges on the company's investments and property, plant, and equipment.

(4)Restructuring and other costs include charges associated with non-core sites and termination-related severance costs.

(5)Spin-off and separation-related costs notably include rebranding costs and professional services supporting Sarbanes-Oxley

implementation efforts.

(6)Other non-operating income, net primarily consists of costs related to gains on proceeds from property and casualty insurance.

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