Astec (ASTE) Q3 2025 Earnings Call Transcript

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DATE

Wednesday, Nov. 5, 2025 at 8:30 a.m. ET

CALL PARTICIPANTS

Chief Executive Officer — Stephen C. Anderson

Chief Financial Officer — Brian J. Harris

Vice President, Investor Relations — Stephen C. Anderson

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TAKEAWAYS

Adjusted EBITDA -- Adjusted EBITDA was $27.1 million, up 55.7% from fiscal Q3 2024 (adjusted), with adjusted EBITDA margin rising by 170 basis points to 7.7%.

Adjusted Earnings Per Share -- Adjusted earnings per share reached $0.47, representing a 30.6% increase over fiscal Q3 2024.

Consolidated Net Sales -- Net sales increased by 20.1%, with growth attributed to increased demand for asphalt and concrete plants and contributions from the TerraSource acquisition.

Backlog -- $449.5 million backlog at quarter-end, including a $64.1 million backlog contribution from TerraSource; both Infrastructure Solutions and Material Solutions experienced slight increases in backlog.

Infrastructure Solutions Parts Sales -- Infrastructure Solutions segment's parts sales rose 14.8% quarter-over-quarter, driven primarily by ongoing initiatives to grow the parts business.

Material Solutions Segment -- Net sales increased $30.5 million (24.1%); adjusted EBITDA increased 6.2%, but adjusted EBITDA margin declined by 170 basis points due to a prior-year litigation reserve release.

Parts Sales Mix (Companywide) -- Increased to approximately 32% of revenue after a 670 basis-point lift from TerraSource, with expectations for further increases.

Book-to-Bill Ratios -- Exceeded 100% in both major segments; both sequential and quarter-over-quarter order increases were observed.

Adjusted ROIC -- Adjusted ROIC of 12.3%.

Liquidity -- $67.3 million in cash and $244.8 million in available credit, for a total of $312.1 million; net debt to adjusted EBITDA of about 2.0 times falls within the target range.

Full-Year Adjusted EBITDA Guidance -- Raised lower end to $132 million, maintaining the upper end at $142 million, reflecting improved backlog and delivery capacity.

Tariff Mitigation -- Management reports that current strategies have neutralized margin impacts and expects continued effectiveness, while acknowledging tariff uncertainty ahead.

TerraSource Integration -- Onboarding completed; management anticipates most acquisition-related synergies materializing in 2026, with margin accretion already observed.

Dealer Inventory in Materials Solutions -- Returned to healthy levels, with resumed dealer stocking and renewed focus on system sales reducing reliance on pure mobile equipment inventory.

Rare Earth Mining Orders -- Initial product orders received from companies backed by government investment, indicating tangible demand in this emergent end market.

SUMMARY

Astec (NASDAQ:ASTE) delivered double-digit gains in net sales, adjusted EBITDA, and adjusted earnings per share for fiscal Q3 2025 (period ended Sept. 30, 2025), supported by strength in core plant equipment and the successful integration of TerraSource. Management raised the full-year adjusted EBITDA outlook and highlighted a robust backlog position, supported by increased customer confidence following monetary policy changes and stable end-market funding from U.S. infrastructure legislation. Tariff impacts are actively managed through purchasing and pricing strategies, and the company reported early returns from rare earth mining activity as a growth catalyst for its materials business.

CEO Anderson said, "The TerraSource margins were accretive," underscoring positive initial financial contribution from the acquisition.

Dealer stocking trends and system sales focus in Material Solutions are changing Astec's inventory risk profile and may reduce volatility in future quarters.

Traction in aftermarket parts—with companywide mix at 32% and further potential upside—suggests a shift to recurring, higher-margin revenue streams.

Management stated that most TerraSource synergies will be realized over a twelve-month period, indicating expectations for continued cost and operational gains into 2026.

Proactive engagement with evolving tariff and supply chain environments demonstrates a commitment to margin preservation, though management noted uncertainty for future periods.

INDUSTRY GLOSSARY

Book-to-Bill Ratio: The ratio of orders received to units invoiced/shipped in the same period, used to gauge demand momentum relative to sales fulfillment.

System Sales: Comprehensive equipment solutions that integrate multiple product categories for a single project or customer order, often sold as turnkey packages.

Full Conference Call Transcript

Stephen C. Anderson: Thank you, Steve. Good morning, everyone, and thank you for joining us. We were pleased to post another solid quarter evidencing our focus on delivering consistent profitability and growth. Before we start, I would like to thank our combined Astec Industries, Inc. team as we continue to execute. As a reminder, our results now include TerraSource, which we completed on July 1. On Slide four, we present a summary of our third quarter performance. This quarter, we continued our positive momentum with increased net sales, increased adjusted EBITDA, and adjusted earnings per share. Adjusted EBITDA was $27.1 million, up $9.7 million or 55.7% from 2024.

Adjusted EBITDA margins increased to 7.7%, a gain of 170 basis points, while adjusted earnings per share reached $0.47 for a year-over-year increase of 30.6%. Our backlog at quarter-end was $449.5 million, representing a sequential increase of $68.7 million, $64.1 million of which was due to the addition of TerraSource. While the backlog in our legacy Infrastructure Solutions and Material Solutions segments both increased slightly, we continue to see customers order closer to their desired delivery dates due to a combination of our shorter lead times and finished goods inventory on hand.

Within the Infrastructure Solutions segment, asphalt plants, concrete plants, heaters, and burners delivered strong results and contributed to margin expansion, while forestry and mobile paving equipment faced headwinds due to challenging end-market conditions. Parts sales for the Infrastructure Solutions segment were strong, posting a 14.8% quarter-over-quarter increase. The Material Solutions segment includes the successful integration of TerraSource. Backlog in this segment has been stable for the past five quarters. We have noticed improved customer sentiment due to the recent movement in interest rates, and our parts sales mix increased 670 basis points with the addition of TerraSource. Lastly, you may recall our normal third quarter experiences seasonality as our customers are busy in the field.

We were pleased to drive enhanced year-over-year performance resulting in a 170 basis point increase in our adjusted EBITDA margin since 2017. On Slide five, we outline the third quarter highlights and present our updated outlook for the full year. As previously highlighted, higher net sales contributed to year-over-year increases in adjusted EBITDA margin and adjusted earnings per share, and we posted adjusted ROIC of 12.3%. Given our solid performance through the first three quarters of the year, we are raising the lower end of our full-year guidance from $123 million to $132 million while maintaining the upper range at $142 million. Our updated outlook is based on the current operating environment, which I will cover on the next slide.

Slide six provides an overview of the current operating environment. There are several external factors affecting the markets in which Astec Industries, Inc. operates, including potential opportunities as well as challenges. One opportunity is the ongoing funding provided by the current Federal Highway Bill in the United States. Multi-year commitments for federal road and bridge projects provide stability for Astec Industries, Inc.'s customers, many of which have reported substantial backlogs of work. In addition, the demand for aggregate, concrete, and asphalt used in other public, residential, and non-residential construction projects is encouraging. All of these are good examples of projects requiring materials processed with the equipment we build at Astec Industries, Inc.

Astec Industries, Inc.'s recent acquisition of TerraSource demonstrates the potential of further inorganic growth within our disciplined financial framework. And the one big beautiful bill enacted in the United States earlier this year extended expiring provisions from the 2017 Tax Cuts and Jobs Act. The reinstated business tax benefits such as accelerated depreciation and R&D tax credits are expected to benefit many of our customers. Lastly, the increased mining activity of rare earth minerals in the United States presents an opportunity for Astec Industries, Inc.'s Material Solutions products as minerals are embedded in ore bodies which must be crushed, screened, and conveyed. Current challenges include fluctuations in tariffs and any related uncertainty they create.

We expect that last week's Federal Open Market Committee decision to reduce interest rates will further improve customer sentiment. On Slide seven, we remind you that Astec Industries, Inc. operates in favorable markets. Within the United States, contract awards from state and local governments serve as key predictors of upcoming construction projects. Those projects typically break ground within thirty to sixty days of being awarded, although the actual construction timeline can extend over several years based on the project size and complexity. As of 08/30/2025, approximately $230 billion or 66% of Infrastructure Investment and Jobs Act funds have been committed, with $150 billion or 44% already allocated.

ARPA reports that obligation rates remain strong, indicating that significant funding will continue to flow even after 2026. The current surface transportation law is set to expire on 10/01/2026. On September 18, Astec Industries, Inc. team members participated in Hill Days co-sponsored by the National Asphalt Paving Association, National Stone, Sand and Gravel Association, and National Ready Mix Concrete Association. After the event, they confirmed federal transportation leaders remain optimistic about passing a new transportation bill next year and are committed to securing presidential approval well before the deadline. These developments are promising for Astec Industries, Inc.

As a specialized provider in the rock-to-road sector, ongoing infrastructure upgrades fuel stable long-term demand for our capital equipment, aftermarket parts, and digital solutions. Our strong reputation in the infrastructure market, especially in aggregates and the roads and bridge construction, positions us well for the future. Slide eight provides a summary of how we actively manage the ongoing shift in the current tariff landscape. Astec Industries, Inc. maintains a proactive approach to minimizing tariff effects. For example, our One Astec procurement team requires suppliers to justify any price increases, and we are actively negotiating every purchase. We have also implemented new pricing measures when necessary and will continue to evaluate the situation to safeguard our margins.

We are consistently pursuing deal sourcing and alternative sourcing options and are working to realign our supply chain, including reshoring to the U.S. when possible. Ongoing management of our manufacturing footprint is also a priority. So far, our mitigation strategies have neutralized tariff-related impacts on our margins. These efforts are evident in our results, and we anticipate our initiatives will remain effective throughout the rest of the year. As you know, the tariff environment is fluid and creates an element of uncertainty for future periods. That said, we will continue to be proactive with our mitigation strategy in order to neutralize the impact of tariffs and to limit potential impacts to manufacturing inefficiencies.

As such, our revised full-year adjusted EBITDA guidance noted on Slide five reflects our current perspective on our operating environment, including the impact of tariffs. Slide nine provides an update on our TerraSource integration. I could not be more pleased with how our team members are working together. Step one of onboarding of TerraSource employees was to ensure a seamless transition to the Astec Industries, Inc. payroll and benefits system. That has been completed successfully. Additional steps are listed on the slide and include harvesting synergies, including procurement opportunities. We have also made investments in high-turn inventory to further drive enhanced parts fill rates.

As a reminder, we define fill rates as having the part ready to ship within twenty-four hours of receiving the order. Although it has only been a few months since welcoming TerraSource to the Astec Industries, Inc. family, our combined team is already in the process of adding to our parts sales force, aligning our sales channel and cross-selling efforts, developing and funding new products, and identifying factory utilization opportunities. We expect most synergies to show up in 2026 and are very satisfied with our progress thus far. On Slide 10, we show our historical backlog information. On a sequential basis, backlog continued to evidence stability in the Infrastructure Solutions and Legacy Material Solutions segment.

TerraSource contributed $64.1 million to Material Solutions and was the primary growth driver to our consolidated backlog. The backlog in our Infrastructure Solutions segment reflects a combination of strong invoicing for asphalt and concrete plants partially offset by weaker demand for mobile paving and forestry equipment. In the Material Solutions segment, backlog net of TerraSource remained steady at approximately $126 million. Looking ahead, we anticipate growing demand for Material Solutions products in the upcoming quarter. Slide 11 is presented net of TerraSource and shows sequential and quarter-over-quarter increases in consolidated implied orders and our book-to-bill ratios. Both segments contributed to the quarter-over-quarter improvements, while the Infrastructure Solutions segment drove the sequential increase on a consolidated basis.

We are pleased to show book-to-bill exceeded 100% in both the Infrastructure Solutions and Material Solutions segments. With that, I'll hand the call over to Brian who will share further insights into our third quarter financial performance.

Brian J. Harris: Thank you, Jakub, and good morning, everyone. The next three slides provide both Q3 and trailing twelve-month data, which we feel provide an excellent view of the underlying financial trends in our business. Turning to our consolidated financial results presented on Slide 13, net sales increased by 20.1%, which was due to strong demand for asphalt and concrete plants and the inclusion of TerraSource. Demand for forestry and mobile paving equipment continues to be soft due to a relatively high-interest rate environment and an extended global slowdown in end markets. Over the trailing twelve-month period, net sales increased 6.7%.

We are pleased to report an adjusted EBITDA of $27.1 million for the third quarter, up 55.7% from $17.4 million in the same period last year. Looking at the trailing twelve months, adjusted EBITDA margin grew 49%. Our third quarter adjusted EBITDA margin grew 170 basis points over the same period in 2024, and on a trailing twelve-month basis, adjusted EBITDA margin grew 300 points to 10.5%. Adjusted earnings per share for the third quarter were $0.47, a 30.6% increase over the $0.36 reported in Q3 2024, while adjusted earnings per share grew by 48.7% on a trailing twelve-month basis.

Turning to the Infrastructure Solutions segment outlined on Slide 14, the third quarter came in strong with a 17.1% increase over the third quarter in 2024. Growth was generated in both equipment and parts sales for the quarter. Solid demand for asphalt and concrete plants helped drive increased domestic sales while international sales were stable. However, forestry and paving remained somewhat depressed. Net sales for the trailing twelve-month period grew 8.8%. Segment operating adjusted EBITDA and EBITDA margin grew quarter over quarter and on a trailing twelve-month basis. Our adjusted operating margin for the Infrastructure Solutions segment grew to 12.4% when compared to the same period in 2024, for an increase of 290 basis points.

Segment operating adjusted EBITDA margin on a trailing twelve-month basis reached an impressive 17.2% versus 12.7% in 2024. The 450 basis point improvement was primarily the result of strategic pricing, operational excellence initiatives, and effective expense management. Moving on to Slide 15. As previously mentioned, the Materials Solutions segment now includes TerraSource. Net sales for the quarter increased $30.5 million or 24.1%. Adjusted EBITDA for the segment increased 6.2%. However, adjusted EBITDA margin showed a 170 basis point decline due to elevated profitability in 2024 stemming from the one-time release of $1.9 million of litigation reserves. On a trailing twelve-month basis, increases were seen in net sales, segment operating adjusted EBITDA, and segment operating EBITDA margin.

As shown on Slide 16, our balance sheet remains strong, supported by substantial liquidity. At quarter-end, we held $67.3 million in cash and cash equivalents and had $244.8 million in available credit, resulting in total liquidity of $312.1 million. Our net debt to adjusted EBITDA of approximately two times is well within our target range of 1.5 to 2.5 times. This provides us with the capacity for continued organic and inorganic growth.

For modeling purposes, you should take into account the following full-year ranges: adjusted EBITDA of $132 million to $142 million, effective tax rate between 24-27%, capital expenditures between $25 million and $35 million, and the following ranges for Q4: adjusted SG&A of $65 million to $73 million, depreciation and amortization of $37 million to $42 million. And I'll now hand the call back to Jakub.

Stephen C. Anderson: On Slide 17, we provide a glimpse of our recently released 2025 corporate sustainability report. As you will see in the report, we are committed to innovating our products and technologies to help our customers achieve their efficiency and cost reduction goals through sustainability investments, respect our natural resources, ensure the safety and well-being of our employees, and uphold employee satisfaction by demonstrating our devotion to our core values. Slide 18 provides an overview of the key investment highlights for Astec Industries, Inc. We take pride in Astec Industries, Inc.'s ongoing reputation as a reliable provider of world-renowned brands and top-tier solutions for our customers. We continue to maintain a high level of engagement with our customers.

While they remain somewhat cautious, their outlook is positive, and customers are optimistic about the ongoing activity in the construction markets. We are also proud that our focus on operational excellence is yielding results with many benefits still ahead. Efforts in manufacturing and procurement are enhancing efficiency, and we are seeing favorable trends in adjusted EBITDA. Our business is driven by several exciting growth opportunities, including expanding our recurring aftermarket parts business, which remains a key focus for the Astec Industries, Inc. team, advancing our strong pipeline of new products.

Please mark your calendars to visit the Astec Industries, Inc. booth at the 2026 CONEXPO-CON/AGG tradeshow in Las Vegas from March 3 through March 7, 2026, where we will showcase various new products. The reliability offered by multi-year federal and state funding for interstate and highway projects in our primary market, the United States, multiple opportunities for expansion in both existing and emerging international markets, strategic inorganic growth prospects that align with our financial objectives. As Brian mentioned, our solid balance sheet gives us flexibility to support growth initiatives and effectively manage our leverage. With that, operator, we are ready for questions.

Operator: First question comes from Stephen Michael Ferazani with Sidoti. Morning, Jakub and Brian. Appreciate the detail on the call this morning.

Stephen Michael Ferazani: First one, question. In terms of you raising the low end of guidance. Was there any worries you saw that sort of dissipated in 3Q? Are you seeing something particularly better in 4Q that gave you the confidence to raise that low end?

Stephen C. Anderson: Yeah. No, Steve. Good question. As a reminder, when we did the Q2 earnings call, we spoke about the fact that we still had quite a bit of gaps in our capacity to fill. At the end of or when we had the Q2 call. Fortunately for us, that's filled in very nicely. And with our short lead times, our teams have the ability to deliver those in Q4. So we have the capital orders to deliver Q4 sales that we need to deliver that new range.

Stephen Michael Ferazani: When I look at your book to bill and order rates in 3Q, at least even the last two years, there was a change this quarter versus the last two years in terms of orders and even in IS. Did something change this year? Because typically, this has been seasonally weaker for the last two years.

Stephen C. Anderson: Yeah. So I do not think we've noticed anything specific. We definitely saw a later or a different booking process from our customers. As I said, if we look at where we were in Q2, we still had substantial gaps in our capacity to fill. And obviously, that came through during the third quarter. Steve, I think the other thing is we are getting to the tail end of what I want to say the uncertainty around tariffs. And I think customers are just getting to a point where they know they need to make a decision, and obviously, we were the beneficiaries of that.

Stephen Michael Ferazani: That's helpful. The one me was a negative surprise that even if I back out the litigation expense from the year ago MS, margins still would have been somewhat flat. Our expectation was TerraSource would have been accretive to margins. Can you tell us if they were in 3Q? And your expectation on the timing of synergy realization now that you've been working through the integration?

Stephen C. Anderson: Yeah. No. Absolutely. So first of all, I want to say we could not be happier with what we're seeing of the TerraSource team now that they're part of our organization. We are excited about the work that our legacy team is doing. Obviously, last year, we had that one release that gave the benefit to that. Quarter over quarter, obviously, you will always have some swings, Steve. We are pretty excited about underlying trends that we're seeing. And I think you will see the margins come. Remember, this was the first quarter that TerraSource was on our side. The legacy MSC sales were a little bit lower compared to last year. So obviously, that has an effect.

But it's early days. We're excited about the work the team is doing. The TerraSource margins were accretive. So there's nothing that we have seen that raises our eyebrows now that we own them for the last three months. So yes, I think in the next coming quarters, the full effect of TerraSource will show up.

Stephen Michael Ferazani: And your expectation, any changes in what you expect can be realized synergies and the timing of realizing them?

Stephen C. Anderson: No. No. We have good visibility of the synergies that we communicated during the deal announcements. Some of the synergies are realized already. So we've seen some benefit. Obviously, they will flow through over a twelve-month period. And we expect to see quite a bit of the synergies year already.

Stephen Michael Ferazani: Okay. You may not have this number, but any breakdown of how much parts as a percentage of revenue per segment now, I'm assuming it will now be at least higher on the MS.

Stephen C. Anderson: Yes. So I think we mentioned that in the release that MS has jumped about 670 basis points. So as a company now, I think we bounced to 32% or so. So I think that number is going to consistently pick up as it reflects in our rolling number. So it's definitely having the effect that we were hoping for, Steve.

Stephen Michael Ferazani: Great. And if I could get one more in, in terms of tariff uncertainty on your end, given the Section 232 tariffs. Is that getting a little bit harder to offset or no changes?

Stephen C. Anderson: I mean, it's complicated. I can tell you that. But we feel that we have a very good understanding of it. Our raised lower end of the range takes into consideration how we think we can deal with the tariffs, Steve. So one thing I will say is that the flow-through is real. And the actions that our teams have taken on pricing and taken on looking for alternative supplies have really positioned us well to mitigate the tariff increases. And I think we're pretty well positioned for next year.

Stephen Michael Ferazani: Great. Thanks, Jakub.

Stephen C. Anderson: Okay. Thank you.

Operator: Your next question comes from Steven Ramsey with Thompson Research Group.

Stephen Michael Ferazani: Good morning, everyone, and glad to be on the call. Thanks for the time.

Stephen C. Anderson: Yeah. Good morning. Wanted to start with the parts results within the infrastructure segment. Good results there. You maybe parse out a bit the volume and price contribution to that 15% growth and maybe just kind of the push-pull dynamics there of better internal execution and reaching customers versus just natural demand that comes from the plants?

Stephen C. Anderson: Yes. Yes. No, good questions, Stephen. One thing I will say is we've been working on driving our parts business for quite a while now. And those efforts are starting to pay off. So obviously, that's a big piece of that growth. I mean, Brian pricing-wise, I don't think we have broken that out specifically. But I will say, if I look at it, we basically adjusted for inflation over the last year or so. And then obviously, Stephen, where we have seen tariffs increases coming through. That have been reflected and overall, I will say probably 4% to 5% cost of goods sold effect that show up partially in that number.

But I will say the majority of that is due to the work the teams are doing to grow that parts business.

Stephen Michael Ferazani: Okay. That's excellent. That's helpful. And you called out asphalt and concrete plant strength in the quarter. On a percentage basis, was one a bigger driver than another?

Stephen C. Anderson: No, I won't say that. We're very fortunate that both those segments are very strong. So no, I will not say that. Obviously, asphalt plant sales, when you sell an asphalt plant, depending on the size, it can be $8 million. So you just have one additional one, and it makes a big swing in the quarter. But no, I don't think there's a trend more to the one versus the other.

Stephen Michael Ferazani: Understood. Understood. Flipping to the material segment, you've talked about the dealer inventory dynamic. Can you maybe share the incremental changes that you're seeing there? And is this something that you expect to be washed out in the fourth quarter? Or is this more of a 2026 dynamic? And then maybe one more that would be good to get insight on is TerraSource within the dealer channel, are they experiencing the same dynamics?

Stephen C. Anderson: Yes. So let's talk legacy first. We've now said for the last two quarters, we've actually, I think, reached a period where our dealer inventory for MS is pretty healthy. The type of inventory that our dealers have or the right level, we've actually started to see some dealer stocking again. So I think we're in a pretty good position, Stephen, when it comes to dealer inventory. Obviously, there's always some movements that take place dealer to dealer. But we're in pretty good shape. And the other thing that I'm excited about in the MS side is historically, we were very strong in our system sales.

So you know, a system is where you put a significant amount of equipment together and provide a customer a whole solution. And there was a period in time where Astec Industries, Inc. lost the focus on that. We brought that focus back here in the last two, three years. And that is starting to show up as well. And obviously, that is something that doesn't necessarily get consumed out of inventory. So you have more of a flow-through effect from us to the dealer. So as that business starts to flow through, I think the dependency we have on dealer inventory for the pure mobile units should become less and less.

On the second question, TerraSource, so TerraSource has a channel that uses, I want to say, all the channels possible. They sell direct in some areas. They do go through dealers in some areas. We have some agents in some areas. So we're busy working through that. There is a possibility that some of their sales in the future will go through our dealer channel. But the product is a little bit different. It's more project-related. So I don't expect, besides spare parts, that our dealers will stock a lot of TerraSource equipment going forward.

Stephen Michael Ferazani: Okay. That's helpful. Wanted to get some more details on the fill rates with TerraSource. You talked about synergies coming in, in 2026 for that business. And their parts fill rates clearly a lot of upside for them to reach core Astec Industries, Inc. levels. Can you talk about the timing on how you expect TerraSource fill rates to improve over the coming quarters and years?

Stephen C. Anderson: Yes, absolutely. I mean, that's an effort that started day one. As you know, I'm personally very passionate about that. And fortunately, the TerraSource team as well, they know having parts on the shelf makes a big difference. There is a big gap between what they have as performance versus what we are having today. And if I look back for Astec Industries, Inc., it took us eighteen to twenty-four months to get to where we are today. I think this is going to be a lot faster than that. So I will say within the next twelve months, we're going to get them very close to our fill rates.

And obviously, we believe that will have a good effect on their performance going forward. So the team is engaged. The work has started. We've identified where to go. And I will continue to keep the market updated on the performance there.

Stephen Michael Ferazani: Excellent. That's good. Last one for me. You called out rare earth mining as a potential demand catalyst. Have you seen any of this to date or in conversations, and are there internal moves you're making within product development or within channels to take advantage of this?

Stephen C. Anderson: Yes. Yes, we actually received our first orders. One of the companies has been in the news a lot lately because the government took stake in that. We got a nice order from them just here. So it's real, Stephen. It's coming. Investments are happening. And the good thing for us is our equipment can do the work today. So there's not a need for a major redevelopment that needs to take place. So our dealer network is very entrepreneurial, so they are very aware of all the opportunities that are coming up in their markets. And they're taking advantage of that. And we are seeing it. So it's not just talk, it's actually order.

Stephen Michael Ferazani: It's great to hear. Thank you.

Operator: That concludes our Q&A session. I'll now turn the conference back over to Mr. Anderson for closing remarks.

Stephen C. Anderson: Thank you, Carly. We do appreciate your participation in our call this morning and thank you for your interest in Astec Industries, Inc. As today's news release states, this conference call has been recorded. A replay of the conference call will be available through 11/19/2025, and an archived webcast will be available for ninety days. The transcript will be available under the Investor Relations section of the NASDAQ Industries' site within the next five business days. This concludes our call. I'm happy to connect later if you have additional questions. Thank you all. Have a good day.

Operator: This concludes today's conference call. You may now disconnect.

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