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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September~~March 3031, ~~2024~~2025


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____________ to ______________

Commission file number 1-41642

Knife River Corporation

(Exact name of registrant as specified in its charter)


Delaware						92-1008893
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

1150 West Century Avenue

P.O. Box 5568

Bismarck, North Dakota 58506-5568

(Address of principal executive offices)

(Zip Code)

(701) 530-1400

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value	KNF	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐.

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐.

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer ☐☒ Accelerated Filer ☐ Non-Accelerated Filer ☒☐ Smaller Reporting Company ☐ Emerging Growth Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒.

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of ~~October~~May 311, ~~2024~~2025: 56,~~612~~652,~~705~~361 shares.

Index

Index
			Page
Introduction			3
Part I -- Financial Information
Item 1. Financial Statements			4
Consolidated Statements of Operations -- Three and Nine Months Ended September 30, 2024 and 2023			4
Consolidated Statements of Operations -- Three Months Ended March 31, 2025 and 2024			4
Consolidated Statements of Comprehensive Income -- Three and Nine Months Ended September 30, 2024 and 2023			5
Consolidated Statements of Comprehensive Income -- Three Months Ended March 31, 2025 and 2024			5
Consolidated Balance Sheets -- September 30, 2024 and 2023, and December 31, 2023			6
Consolidated Balance Sheets -- March 31, 2025 and 2024, and December 31, 2024			6
Consolidated Statements of Equity -- Three and Nine Months Ended September 30, 2024 and 2023			7
Consolidated Statements of Equity -- Three Months Ended March 31, 2025 and 2024			7
Consolidated Statements of Cash Flows -- Nine Months Ended September 30, 2024 and 2023			9
Consolidated Statements of Cash Flows -- Three Months Ended March 31, 2025 and 2024			8
Notes to Consolidated Financial Statements			109
1. Background			109
2. Basis of presentation			109
3. New accounting standards			1210
4. Receivables and allowance for expected credit losses			1211
5. Inventories			1311
6. Net income per share			14
6. Net loss per share			12
7. Accumulated other comprehensive loss			1412
8. Revenue from contracts with customers			1612
9. Uncompleted contracts			1713
10. Goodwill and other intangible assets			18
10. Acquisitions and Dispositions			14
11. Fair value measurements			19
11. Goodwill and other intangible assets			16
12. Debt			21
12. Fair value measurements			17
13. Cash flow information			22
13. Debt			19
14. Business segment data			22
14. Cash flow information			20
15. Commitments and contingencies			24
15. Business segment data			20
16. Related-party transactions			25
16. Commitments and contingencies			22
17. Subsequent event			25
17. Related-party transactions			22
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations			2623
Item 3. Quantitative and Qualitative Disclosures About Market Risk			4436
Item 4. Controls and Procedures			4437
Part II -- Other Information
Item 1. Legal Proceedings			4638
Item 1A. Risk Factors			4638
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			4638
Item 3. Defaults Upon Senior Securities			4638
Item 4. Mine Safety Disclosures			4638
Item 5. Other Information			4638
Item 6. Exhibits			4638
Exhibits Index			4739
Signatures			4840

Unless otherwise stated or the context otherwise requires, references in this report to “Knife River,” the “Company,” “we,” “our,” or “us” refer to Knife River Corporation and its consolidated subsidiaries.

Index

Introduction

Knife River is an aggregates-led construction materials and contracting services provider in the United States. Our 1.12 billion tons of aggregate reserves, as of December 31, 2024, provide the foundation for our vertically integrated business strategy, with approximately 37 percent of our aggregates ~~in 2024~~ being used internally to support value-added downstream products (ready-mix concrete and asphalt) and contracting services (heavy-civil construction, asphalt paving, concrete construction, site development and grading services, and in some segments the manufacturing of prestressed concrete products). We are strategically focused on being the provider of choice in mid-size, high-growth markets and are committed to our plan for continued growth and to delivering for our stakeholders — customers, communities, employees and stockholders — by executing on our four core values: People, Safety, Quality and the Environment.

We supply construction materials to customers from 14 states and also provide related contracting services, which are primarily to public-sector customers for the development and servicing of highways, local roads, bridges and other public-infrastructure projects. We have broad access to high-quality aggregates in most of our markets, which forms the foundation of our vertically integrated business model. We share resources, including plants, equipment and people, across our various locations to maximize efficiency. We also transport our products by truck, rail and barge, depending on the particular market, to complete the vertical value chain. Our strategically located aggregate sites, ready-mix plants and asphalt plants, along with our fleet of ready-mix and dump trucks, enable us to better serve our customers. We believe our integrated and expansive business model is a strong competitive advantage that provides scale, efficiency and operational excellence for the benefit of customers, stockholders and the broader communities that we serve.

~~Knife~~In ~~River~~January ~~is organized into six operating segments: Pacific~~2025, ~~Northwest,~~we ~~Mountain,~~made ~~North~~a ~~Central,~~change ~~South~~to ~~and~~our ~~Energy~~organizational ~~Services.~~structure ~~These operating segments are used~~ to ~~determine~~better ~~the~~align ~~Company's~~with ~~reportable segments: Pacific, Northwest, Mountain, Central and Energy Services, which are based on~~ our ~~method~~business ofstrategy. ~~internal~~We ~~reporting~~reorganized ~~and management of~~ our business. ~~Four of the reportable~~ segments ~~are~~to ~~aligned~~reflect bychanges ~~key~~in ~~geographic~~the ~~areas~~way ~~due~~our tochief ~~the~~operating ~~production~~decision ofmaker ~~construction~~evaluates ~~materials~~performance, ~~and~~makes ~~related~~operating ~~contracting~~decisions ~~services~~ and ~~one~~allocates ~~is based on product line~~resources. ~~Each~~Our ~~geographic~~former ~~segment~~Pacific ~~offers a vertically integrated suite of products~~ and ~~services,~~Northwest ~~including~~operating ~~aggregates,~~segments ~~ready-mix~~were ~~concrete,~~combined ~~asphalt~~to ~~and~~form ~~contracting services, while~~ the ~~Energy~~new ~~Services~~West operating segment,. ~~which~~Our ~~has~~former ~~locations~~North ~~throughout~~Central ~~our geographic footprint, produces~~ and ~~supplies~~South ~~liquid~~operating ~~asphalt~~segments ~~and~~were ~~related~~combined ~~services,~~to ~~primarily~~form ~~for~~the ~~use~~new inCentral ~~asphalt~~operating ~~road construction~~segment. WeThe ~~also~~reorganization ~~provide~~resulted ~~the~~in ~~details~~four ofoperating ~~Corporate~~segments: ~~Services~~West, ~~which includes accounting~~Mountain, ~~legal,~~Central ~~treasury,~~and ~~information~~Energy ~~technology~~Services, ~~human~~each ~~resources,~~of ~~corporate~~which ~~development~~is ~~costs~~also ~~and~~a ~~certain~~reportable ~~corporate expenses that support our operating segments~~segment. ~~The~~All ~~internal~~periods ~~reporting~~have ofbeen ~~these~~recast ~~segments~~to isconform ~~defined~~to ~~based on~~ the ~~reporting~~current ~~and~~reportable ~~review~~segment ~~process used by our chief executive officer and chief operating officer~~presentation.

InThree of the ~~fourth~~reportable ~~quarter~~segments ofare ~~2023,~~aligned weby ~~realigned~~key ~~our~~geographic ~~reportable~~areas, ~~segments~~West, toMountain ~~better~~and ~~support~~Central, ~~our~~due ~~operational~~to ~~strategies.~~the ~~The~~production ~~liquid~~of ~~asphalt~~construction materials and related contracting services ~~portion~~and ofone ~~the~~is ~~Pacific~~based on product line. Each geographic segment’s ~~businesses~~offers ~~are~~a ~~now~~vertically ~~reported~~integrated ~~under~~suite of products and services, including aggregates, ready-mix concrete, asphalt and contracting services, while the Energy Services segment., Inwhich ~~addition,~~has ~~the~~locations ~~North~~throughout ~~Central~~our geographic footprint, produces and ~~South~~supplies ~~operating~~liquid ~~regions~~asphalt ~~have~~and ~~been~~related ~~aggregated~~services, ~~into~~primarily ~~one~~for ~~reportable~~use ~~segment,~~in ~~Central~~asphalt road construction. We also ~~reallocated~~provide ~~certain~~the ~~amounts~~details toof ~~the~~Corporate ~~operating~~Services, ~~segments~~which ~~that~~includes ~~were~~accounting, ~~previously~~legal, ~~reported~~treasury, ~~within~~information ~~Corporate~~technology, ~~Services.~~human ~~All~~resources, ~~periods~~corporate ~~have~~development ~~been~~costs ~~recast~~and tocertain ~~conform~~corporate ~~with~~expenses ~~the~~that ~~revised~~support ~~presentation~~our operating segments. For more information on ~~the~~our ~~Company's~~ business segments, see Note 1415 of the Notes to Consolidated Financial Statements.

On May 31, 2023, the separation of Knife River from MDU Resources Group, Inc. ("MDU Resources") and its other businesses was completed and Knife River became an independent, publicly traded company ("Separation") listed on the New York Stock Exchange under the symbol "KNF". The Separation was completed as a tax-free spin-off for U.S. federal income tax purposes. As a result of the Separation, MDU Resources distributed shares representing approximately 90 percent of Knife River's outstanding common stock to holders of record of MDU Resources' common stock as of the close of business on May 22, 2023 ("Distribution"). In November 2023, MDU Resources disposed of all retained shares of Knife River.

Index

Part I -- Financial Information

Item 1. Financial Statements

Knife River Corporation

Consolidated Statements of Operations

(Unaudited)

Three Months Ended

~~Nine Months Ended~~

September 30,

March 31,

2024

2023

2024

2023

2025

2024

(In thousands, except per share amounts)

Revenue:

Construction materials

~~545~~213,~~711~~407

~~553~~204,~~057~~095

~~1,184,938~~

~~1,177,726~~

Contracting services

~~559~~140,~~582~~064

~~537~~125,~~315~~495

~~1,056,851~~

~~1,005,736~~

Total revenue

1353,~~105,293~~471

1329,~~090,372~~590

~~2,241,789~~

~~2,183,462~~

Cost of revenue:

Construction materials

~~345~~233,~~046~~763

~~346~~209,~~298~~830

~~865,198~~

~~856,606~~

Contracting services

~~487~~129,~~236~~303

~~474~~113,~~685~~266

~~920,867~~

~~900,388~~

Total cost of revenue

~~832~~363,~~282~~066

~~820~~323,~~983~~096

~~1,786,065~~

~~1,756,994~~

Gross profit

~~273~~(9,~~011~~595)

~~269~~6,~~389~~494

~~455,724~~

~~426,468~~

Selling, general and administrative expenses

6373,~~874~~058

5960,~~168~~221

~~183,569~~

~~167,276~~

Operating income

209,137

210,221

272,155

259,192

Operating loss

(82,653)

(53,727)

Interest expense

1315,~~936~~263

1513,~~354~~976

~~41,848~~

~~44,005~~

Other income

24,~~487~~567

73,748

~~7,541~~

~~3,311~~

Income before income taxes

197,688

194,874

237,848

218,498

Loss before income taxes

(93,349)

(63,955)

Income tax expense

49,584

48,219

59,443

56,327

Income tax benefit

(24,639)

(16,326)

Net income

148,104

146,655

178,405

162,171

Net loss

(68,710)

(47,629)

Net income per share:

Net loss per share

Basic

2(1.6221)

2(.5984)

~~3.15~~

~~2.87~~

Diluted

2(1.6021)

2(.5884)

~~3.14~~

~~2.86~~

Weighted average common shares outstanding:

Basic

56,~~613~~626

56,~~566~~590

~~56,605~~

~~56,566~~

Diluted

56,~~871~~626

56,~~735~~590

~~56,809~~

~~56,633~~

The accompanying notes are an integral part of these consolidated financial statements.

Index

Knife River Corporation
Consolidated Statements of Comprehensive Income
(Unaudited)
	Three Months Ended				~~Nine Months Ended~~
	September 30,				September 30,
	March 31,
	2024		2023		2024		2023
	2025		2024
	(In thousands)
Net income	$	148,104	$	146,655	$	178,405	$	162,171
Net loss	$	(68,710)	$	(47,629)
Other comprehensive income:
Reclassification adjustment for loss on derivative instruments included in net income, net of tax of $0 and $0 for the three months ended and $0 and $28 for the nine months ended in 2024 and 2023, respectively	—		—		—		90
Postretirement liability adjustment:
Postretirement liability losses arising during the period, net of tax of $0 and $0 for the three months ended and $0 and $(6) for the nine months ended in 2024 and 2023, respectively	—		—		—		(17)
Amortization of postretirement liability losses included in net periodic benefit cost, net of tax of $20 and $25 for the three months ended 2025 and 2024, respectively	63		78
Amortization of postretirement liability losses included in net periodic benefit cost, net of tax of $25 and $16 for the three months ended and $75 and $47 for the nine months ended in 2024 and 2023, respectively	78		49		233		144
Postretirement liability adjustment	63		78
Postretirement liability adjustment	78		49		233		127
Other comprehensive income	63		78
Other comprehensive income	78		49		233		217
Comprehensive loss attributable to common stockholders	$	(68,647)	$	(47,551)
Comprehensive income attributable to common stockholders	$	148,182	$	146,704	$	178,638	$	162,388

The accompanying notes are an integral part of these consolidated financial statements.

Index

Knife River Corporation
Consolidated Balance Sheets
(Unaudited)
	September 30, 2024		September 30, 2023		December 31, 2023
	March 31, 2025		March 31, 2024		December 31, 2024
Assets	(In thousands, except shares and per share amounts)
	(In thousands, except shares and per share amounts)
Assets
Current assets:
Cash, cash equivalents and restricted cash	$	~~267~~138,~~442~~482	$	~~116~~170,~~159~~658	$	~~262~~281,~~320~~134
Receivables, net	~~449~~238,~~188~~066		~~491~~183,~~866~~708		~~266~~267,~~785~~240
Costs and estimated earnings in excess of billings on uncompleted contracts	6928,~~309~~505		5033,~~545~~559		2731,~~293~~283
Inventories	~~347~~467,~~300~~051		~~314~~375,~~711~~783		~~319~~380,~~623~~336
Prepayments and other current assets	2674,~~396~~600		3854,~~094~~051		3727,~~522~~675
Total current assets	1946,~~159,635~~704		1817,~~011,375~~759		~~913~~987,~~543~~668
Noncurrent assets:
Property, plant and equipment	2,692,182		2,547,577		2,579,734
Net property, plant and equipment	1,743,513		1,320,612		1,441,700
Less accumulated depreciation, depletion and amortization	1,346,022		1,248,042		1,264,687
Goodwill	449,554		274,478		297,225
Net property, plant and equipment	1,346,160		1,299,535		1,315,047
Other intangible assets, net	41,967		10,277		29,414
Goodwill	275,256		274,478		274,478
Operating lease right-of-use assets	46,516		45,832		49,378
Other intangible assets, net	9,854		11,463		10,821
Investments and other	52,453		44,685		45,817
Operating lease right-of-use assets	47,430		44,309		44,706
Total noncurrent assets	2,334,003		1,695,884		1,863,534
Investments and other	45,782		39,722		41,218
Total assets	$	3,280,707	$	2,513,643	$	2,851,202
Total noncurrent assets	1,724,482		1,669,507		1,686,270
Total assets	$	2,884,117	$	2,680,882	$	2,599,813
Liabilities and Stockholders' Equity
Current liabilities:
Long-term debt - current portion	$	811,~~791~~780	$	7,~~082~~072	$	710,~~082~~475
Accounts payable	~~180~~111,~~572~~962		~~148~~97,~~977~~379		~~107~~140,~~656~~834
Billings in excess of costs and estimated earnings on uncompleted contracts	4442,~~786~~016		5850,~~785~~844		5142,~~376~~126
Taxes payable	15,991		53,281		9,300
Accrued compensation	18,983		17,699		50,655
Accrued compensation	42,071		37,922		48,098
Accrued interest	15,951		15,459		5,535
Accrued interest	13,772		16,054		7,247
Other taxes payable	14,195		11,884		8,286
Current operating lease liabilities	13,~~544~~398		13,~~702~~282		1214,~~948~~844
Other accrued liabilities	~~106~~93,~~576~~781		8983,~~164~~611		~~103~~97,~~564~~282
Total current liabilities	~~426~~322,~~103~~066		~~424~~297,~~967~~230		~~347~~370,~~271~~037
Noncurrent liabilities:
Long-term debt	~~669~~1,~~672~~160,385		~~675~~673,~~649~~539		~~674~~666,~~577~~911
Deferred income taxes	~~187~~221,~~915~~588		~~173~~174,~~989~~122		174,~~542~~727
Noncurrent operating lease liabilities	33,~~886~~118		3032,~~607~~551		3134,~~758~~534
Other	~~117~~135,~~611~~966		~~132~~117,~~652~~574		~~105~~128,~~653~~908
Total liabilities	1,~~435~~873,~~187~~123		1,~~437~~295,~~864~~016		1,~~333~~375,~~801~~117
Commitments and contingencies
Stockholders' equity:
Common stock, 300,000,000 shares authorized, $0.01 par value, 57,043,841 shares issued and 56,612,705 shares outstanding at September 30, 2024; 56,997,350 shares issued and 56,566,214 shares outstanding at September 30, 2023; 57,009,542 shares issued and 56,578,406 shares outstanding at December 31, 2023	570		570		570
Common stock, 300,000,000 shares authorized, $0.01 par value, 57,083,497 shares issued and 56,652,361 shares outstanding at March 31, 2025; 57,040,840 shares issued and 56,609,704 shares outstanding at March 31, 2024; 57,043,841 shares issued and 56,612,705 shares outstanding at December 31, 2024	571		570		570
Other paid-in capital	~~618~~621,~~799~~042		~~613~~614,~~024~~679		~~614~~620,~~513~~897
Retained earnings	~~844~~798,~~273~~836		~~645~~618,~~185~~245		~~665~~867,~~874~~546
Treasury stock held at cost - 431,136 shares	(3,626)		(3,626)		(3,626)
Accumulated other comprehensive loss	(119,~~086~~239)		(1211,~~135~~241)		(119,~~319~~302)
Total stockholders' equity	1,~~448~~407,~~930~~584		1,~~243~~218,~~018~~627		1,~~266~~476,~~012~~085
Total liabilities and stockholders' equity	$	23,~~884~~280,~~117~~707	$	2,~~680~~513,~~882~~643	$	2,~~599~~851,~~813~~202

The accompanying notes are an integral part of these consolidated financial statements.

Index

Knife River Corporation
Consolidated Statements of Equity
(Unaudited)
	Common Stock			OtherPaid-in Capital		Retained Earnings		~~MDU Resources' Stock Heldby Subsidiary~~	Treasury Stock		~~Treasury Stock~~	Accumulated Other Comprehensive Loss		~~Accumula-ted Other Comprehen-sive Loss~~
	Shares	Amount						~~Shares~~	~~Amount~~		Shares	~~Amount~~		Amount		Total
	(In thousands, except shares)
At December 31, 2023	57,009,542	$	570	$	614,513	$	665,874	—	$	—	(431,136)	$	(3,626)	$	(11,319)	$	1,266,012
At December 31, 2024	57,043,841	$	570	$	620,897	$	867,546				(431,136)	$	(3,626)	$	(9,302)	$	1,476,085
Net loss	—	—		—		(4768,~~629~~710)		—	—		—	—		—		(4768,~~629~~710)
Other comprehensive income	—	—		—		—		—	—		—	—		7863		7863
Stock-based compensation expense	—	—		12,~~811~~799		—		—	—		—	—		—		12,~~811~~799
Common stock issued for employee compensation, net of tax withholding	3139,~~298~~656	—1		(12,~~645~~654)		—		—	—		—	—		—		(12,~~645~~653)
At March 31, 2024	57,040,840	$	570	$	614,679	$	618,245	—	$	—	(431,136)	$	(3,626)	$	(11,241)	$	1,218,627
At March 31, 2025	57,083,497	$	571	$	621,042	$	798,836				(431,136)	$	(3,626)	$	(9,239)	$	1,407,584
Net income	—	—		—		77,929		—	—		—	—		—		77,929
Other comprehensive Income	—	—		—		—		—	—		—	—		77		77
Stock-based compensation expense	—	—		2,106		(5)		—	—		—	—		—		2,101
Common stock issued for board of director fees	3,001	—		(28)		—		—	—		—	—		—		(28)
At June 30, 2024	57,043,841	$	570	$	616,757	$	696,169	—	$	—	(431,136)	$	(3,626)	$	(11,164)	$	1,298,706
Net income	—	—		—		148,104		—	—		—	—		—		148,104
Other comprehensive income	—	—		—		—		—	—		—	—		78		78
Stock-based compensation expense	—	—		2,042		—		—	—		—	—		—		2,042
At September 30, 2024	57,043,841	$	570	$	618,799	$	844,273	—	$	—	(431,136)	$	(3,626)	$	(11,086)	$	1,448,930

The accompanying notes are an integral part of these consolidated financial statements.


Knife River Corporation
Consolidated Statements of Equity
(Unaudited)
	Common Stock			Other Paid-in Capital		Retained Earnings		Treasury Stock		Accumulated Other Comprehensive Loss
	Shares	Amount							Shares			Amount		Total
	(In thousands, except shares)
At December 31, 2023	57,009,542	$	570	$	614,513	$	665,874		(431,136)	$	(3,626)	$	(11,319)	$	1,266,012
Net loss	—	—		—		(47,629)			—	—		—		(47,629)
Other comprehensive income	—	—		—		—			—	—		78		78
Stock-based compensation expense	—	—		1,811		—			—	—		—		1,811
Common stock issued for employee compensation, net of tax withholding	31,298	—		(1,645)		—			—	—		—		(1,645)
At March 31, 2024	57,040,840	$	570	$	614,679	$	618,245		(431,136)	$	(3,626)	$	(11,241)	$	1,218,627

The accompanying notes are an integral part of these consolidated financial statements.

Index

Knife River Corporation
Consolidated Statements of Equity
Consolidated Statements of Cash Flows
(Unaudited)
	Common Stock				OtherPaid-in Capital		Retained Earnings		MDU Resources' Stock Heldby Subsidiary			Treasury Stock			Accumula-ted Other Comprehen-sive Loss
	Three Months Ended
	Shares		Amount						Shares	Amount		Shares	Amount				Total
	March 31,
	(In thousands, except shares)
	2025		2024
At December 31, 2022	80,000		$	800	$	549,106	$	494,661	(538,921)	$	(3,626)	—	$	—	$	(12,352)	$	1,028,589
	(In thousands)
Net loss	—		—		—		(41,320)		—	—		—	—		—		(41,320)
Operating activities:
Other comprehensive income	—		—		—		—		—	—		—	—		93		93
Net loss	$	(68,710)	$	(47,629)
Stock-based compensation expense	—		—		453		(39)		—	—		—	—		—		414
Adjustments to reconcile net loss to net cash used by operating activities:
Net transfers to Centennial	—		—		(1,385)		(11,622)		—	—		—	—		—		(13,007)
Depreciation, depletion and amortization	38,762		32,212
At March 31, 2023	80,000		$	800	$	548,174	$	441,680	(538,921)	$	(3,626)	—	$	—	$	(12,259)	$	974,769
Deferred income taxes	437		(311)
Net income	—		—		—		56,836		—	—		—	—		—		56,836
Provision for credit losses	335		(6)
Other comprehensive Income	—		—		—		—		—	—		—	—		75		75
Amortization of debt issuance costs	787		691
Stock-based compensation expense	—		—		212		14		—	—		—	—		—		226
Employee stock-based compensation costs	2,799		1,811
Transfer of MDU Resources' stock held by subsidiary	—		—		—		—		538,921	3,626		—	—		—		3,626
Pension and postretirement benefit plan net periodic benefit cost	360		303
Receipt of treasury stock at cost	—		—		—		—		—	—		(431,136)	(3,626)		—		(3,626)
Unrealized (gains) losses on investments	692		(1,212)
Retirement of historical common stock in connection with the Separation	(80,000)		(800)		800		—		—	—		—	—		—		—
Gains on sales of assets	(2,410)		(1,249)
Issuance of common stock in connection with the Separation	56,997,350		570		(596)		—		—	—		—	—		—		(26)
Gain on bargain purchase	(3,547)		—
Net transfers from Centennial and MDU Resources including Separation adjustments	—		—		62,972		—		—	—		—	—		—		62,972
Equity in (losses) earnings of unconsolidated affiliates	15		(4)
At June 30, 2023	56,997,350		$	570	$	611,562	$	498,530	—	$	—	(431,136)	$	(3,626)	$	(12,184)	$	1,094,852
Changes in current assets and liabilities, net of acquisitions:
Net income	—		—		—		146,655		—	—		—	—		—		146,655
Receivables	41,081		76,816
Other comprehensive income	—		—		—		—		—	—		—	—		49		49
Inventories	(50,360)		(56,160)
Stock-based compensation expense	—		—		1,462		—		—	—		—	—		—		1,462
Other current assets	(35,473)		(16,528)
At September 30, 2023	56,997,350		$	570	$	613,024	$	645,185	—	$	—	(431,136)	$	(3,626)	$	(12,135)	$	1,243,018
Accounts payable	(12,772)		(4,183)
Other current liabilities	(40,255)		(39,691)
Pension and postretirement benefit plan contributions	(158)		(128)
Other noncurrent changes	3,140		12,058
Net cash used in operating activities	(125,277)		(43,210)
Investing activities:
Capital expenditures	(74,958)		(43,689)
Acquisitions, net of cash acquired	(443,439)		—
Net proceeds from sale or disposition of property and other	17,524		1,629
Investments	(2,760)		(3,009)
Net cash used in investing activities	(503,633)		(45,069)
Financing activities:
Issuance of long-term debt	500,000		—
Repayment of long-term debt	(19)		(1,738)
Debt issuance costs	(11,070)		—
Tax withholding on stock-based compensation	(2,653)		(1,645)
Net cash provided by (used in) financing activities	486,258		(3,383)
Decrease in cash, cash equivalents and restricted cash	(142,652)		(91,662)
Cash, cash equivalents and restricted cash -- beginning of year	281,134		262,320
Cash, cash equivalents and restricted cash -- end of period	$	138,482	$	170,658

The accompanying notes are an integral part of these consolidated financial statements.

Index

Knife River Corporation
Consolidated Statements of Cash Flows
(Unaudited)
	Nine Months Ended
	September 30,
	2024		2023
	(In thousands)
Operating activities:
Net income	$	178,405	$	162,171
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion and amortization	101,519		92,511
Deferred income taxes	13,432		(1,884)
Provision for credit losses	603		1,386
Amortization of debt issuance costs	2,072		2,425
Employee stock-based compensation costs	5,728		2,127
Pension and postretirement benefit plan net periodic benefit cost	908		889
Unrealized gains on investments	(2,865)		(685)
Gains on sales of assets	(6,323)		(3,806)
Changes in current assets and liabilities, net of acquisitions:
Receivables	(224,758)		(302,536)
Due from related-party	—		16,050
Inventories	(27,262)		8,566
Other current assets	11,125		(20,127)
Accounts payable	77,152		91,663
Due to related-party	—		(7,310)
Other current liabilities	17,268		78,006
Pension and postretirement benefit plan contributions	(2,502)		(1,611)
Other noncurrent changes	5,388		35,092
Net cash provided by operating activities	149,890		152,927
Investing activities:
Capital expenditures	(127,161)		(86,450)
Acquisitions, net of cash acquired	(15,008)		—
Net proceeds from sale or disposition of property and other	7,605		5,227
Investments	(3,263)		(1,764)
Net cash used in investing activities	(137,827)		(82,987)
Financing activities:
Issuance of long-term related-party notes, net	—		205,275
Issuance of long-term debt	—		700,000
Repayment of long-term debt	(5,268)		(1,891)
Debt issuance costs	—		(16,640)
Proceeds from issuance of common stock	—		(26)
Tax withholding on stock-based compensation	(1,673)		—
Net transfers to Centennial	—		(850,589)
Net cash (used in) provided by financing activities	(6,941)		36,129
Increase in cash, cash equivalents and restricted cash	5,122		106,069
Cash, cash equivalents and restricted cash -- beginning of year	262,320		10,090
Cash, cash equivalents and restricted cash -- end of period	$	267,442	$	116,159

The accompanying notes are an integral part of these consolidated financial statements.

Index

Knife River Corporation

Notes to Consolidated

Financial Statements

~~September~~March 3031, ~~2024~~2025 and ~~2023~~2024

(Unaudited)

Note 1 - Background

At Knife River, iswe are a people-first construction materials and contracting services company. We provide construction materials and contracting services to build safe roads, bridges, airport runways and other critical infrastructure needs that connect people with where they want to go and with the supplies they need. ~~Knife~~We ~~River~~are is one of the leading providers of crushed stone and sand and gravel in the United States and ~~operates~~operate across 14 states. We conduct our operations through ~~five~~four reportable segments: ~~Pacific~~West, ~~Northwest,~~ Mountain, Central and Energy Services.

In ~~the~~January ~~fourth~~2025, ~~quarter~~we ofmade ~~2023,~~a wechange ~~realigned~~to our ~~reportable~~organizational ~~segments~~structure to better ~~support~~align with our ~~operational~~business ~~strategies~~strategy. AsWe areorganized ~~result,~~our abusiness ~~portion~~segments ofto reflect changes in the way our chief operating decision maker evaluates performance, makes operating decisions and allocates resources. Our former Pacific ~~segment’s~~and ~~businesses~~Northwest ~~are~~operating ~~now~~segments ~~reported~~were ~~under~~combined to form the ~~Energy~~new ~~Services~~West operating segment. InOur ~~addition,~~former ~~the~~ North Central and South operating ~~regions~~segments ~~have~~were ~~been~~combined ~~aggregated~~to ~~into~~form ~~one~~the ~~reportable~~new Central operating segment. The reorganization resulted in four operating segments: West, Mountain, Central. Weand Energy Services, each of which is also ~~reallocated~~a ~~certain~~reportable ~~amounts~~segment. toEach ~~the~~segment’s ~~operating~~performance ~~segments~~is ~~that~~evaluated ~~were~~based ~~previously~~on ~~reported~~segment ~~within~~results ~~Corporate~~without ~~Services~~allocating corporate expenses, which include corporate costs associated with accounting, legal, treasury, business development, information technology, human resources, and other corporate expenses that support the operating segments. ~~All~~Prior periods have been recast to conform ~~with~~to the ~~revised~~current ~~presentation.~~reportable ~~See~~segment ~~Note 14 for additional information~~presentation.

Separation from MDU Resources

On May 31, 2023, MDU Resources completed the previously announced separation of Knife River through the distribution of approximately 90 percent of the outstanding shares of common stock, par value $.01 per share, of Knife River to the stockholders of record of MDU Resources as of the close of business on May 22, 2023. MDU Resources retained approximately 10 percent of the outstanding shares of Knife River common stock. The Distribution was structured as a pro rata distribution of one share of Knife River common stock for every four shares of MDU Resources common stock. In November 2023, MDU Resources disposed of all 5,656,621 retained shares of Knife River common stock in an underwritten public offering. As a result of the Distribution, Knife River is now an independent public company and its common stock is listed under the symbol “KNF” on the New York Stock Exchange.

All share and earnings per share information has been retroactively adjusted for all periods presented to reflect the Distribution.

Note 2 - Basis of presentation

The accompanying consolidated interim financial statements were prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Interim financial statements do not include all disclosures provided in annual financial statements and, accordingly, these financial statements should be read in conjunction with the Company's ~~2023~~2024 Annual Report on Form 10-K ("Annual Report"). The information is unaudited but includes adjustments that are, in the opinion of management, necessary for a fair presentation of the accompanying consolidated interim financial statements and are of a normal recurring nature.

~~Prior~~All torevenues ~~the~~and ~~Separation~~costs, ~~Knife~~as ~~River~~well ~~operated~~ as aassets ~~wholly~~and ~~owned subsidiary of Centennial Energy Holdings~~liabilities, ~~Inc.,~~directly aassociated ~~direct~~with ~~wholly~~our ~~owned~~business ~~subsidiary~~activities ofare ~~MDU~~included ~~Resources~~in ~~and~~ the ~~direct parent company of Knife River prior to the spinoff ("Centennial") and an indirect, wholly owned subsidiary of MDU Resources and not as a stand-alone company. The accompanying~~ consolidated financial statements. ~~and~~General ~~footnotes~~corporate ~~for~~expenses ~~the~~are ~~periods~~included ~~prior to the Separation were prepared on a "carve-out" basis using a legal entity approach~~ in ~~conformity with GAAP and were derived from~~ the ~~consolidated~~Consolidated ~~financial~~Statements ~~statements~~ of ~~MDU~~Operations ~~Resources~~within asselling, ifgeneral ~~Knife~~and ~~River~~administrative ~~operated~~expenses onand aother ~~stand-alone basis during these periods~~income.

~~All~~On ~~revenues~~March ~~and costs~~7, ~~as well as assets and liabilities~~2025, ~~directly~~we ~~associated~~acquired ~~with~~Strata ~~our~~Corporation ~~business activities are included in the consolidated financial statements. In the periods prior to the Separation~~(Strata), ~~the~~a ~~consolidated~~leading ~~financial~~construction ~~statements~~materials ~~include expense allocations for certain functions provided by MDU Resources~~ and ~~Centennial,~~contracting including, but not limited to, certain general corporate expenses related to senior management, legal, human resources, finance and accounting, treasury, information technology, communications, procurement, tax, insurance and other shared services. ~~These~~provider ~~general corporate expenses are included~~ in ~~the~~North ~~Consolidated~~Dakota ~~Statements of Operations within selling, general~~ and ~~administrative~~northwestern ~~expenses and other income~~Minnesota. ~~There~~The ~~were~~purchase noprice ~~amounts allocated to Knife River~~ for ~~the~~Strata ~~three~~totaled ~~months ended September 30, 2023, and~~ $9454.0 million ~~was~~and ~~allocated~~is ~~for~~subject ~~the~~to ~~nine~~post-closing ~~months ended September 30, 2023 in selling, general and administrative expenses~~adjustments. ~~There~~The ~~were~~results noof ~~amounts~~operations ~~allocated for the three months ended September 30, 2023~~ and ~~$348,000~~balance ~~was~~sheet ~~allocated~~accounts for ~~the~~Strata ~~nine~~are ~~months~~included ~~ended September 30, 2023~~ in ~~other income. These items were allocated on~~ the ~~basis~~consolidated offinancial ~~direct~~statements ~~usage~~from ~~when identifiable, with~~ the ~~remainder~~date ~~principally allocated on the basis~~ of percent of total capital invested or other allocation methodologies that were considered to be a reasonable reflection of the utilization of the services provided to the benefits received, including the following: number of employees paid and stated as cost per check; number of employees served; weighted factor of travel, managed units, national account spending, equipment and fleet acquisitions; purchase order dollars spent and purchase order line count; number of payments, vouchers or unclaimed property reports; labor hours; time tracked; and projected workloadacquisition. ~~The allocations may not, however, reflect the expenses we would have~~

10Management has also evaluated the impact of events occurring after March 31, 2025, up to the date of issuance of these consolidated interim financial statements on May 6, 2025, that would require recognition or disclosure in the Consolidated Financial Statements.

Index

incurred as a stand-alone company for the periods presented. These costs also may not be indicative of the expenses that we will incur in the future or would have incurred if we had obtained these services from a third party.

Management has also evaluated the impact of events occurring after September 30, 2024, up to the date of issuance of these consolidated interim financial statements on November 4, 2024, that would require recognition or disclosure in the Consolidated Financial Statements. See Note 17 - Subsequent Events for more details on these events.

Principles of consolidation

For all periods, the consolidated financial statements were prepared in accordance with GAAP and include the accounts of Knife River and its wholly owned subsidiaries. All intercompany accounts and transactions between the businesses comprising Knife River have been eliminated in the accompanying audited consolidated financial statements.

Use of estimates

The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities, at the date of the consolidated financial statements, as well as the reported amounts of revenues and expenses during the reporting period. Estimates are used for items such as long-lived assets and goodwill; fair values of acquired assets and liabilities under the acquisition method of accounting; aggregate reserves; property depreciable lives; tax provisions; revenue recognized using the cost-to-cost measure of progress for contracts; expected credit losses; environmental and other loss contingencies; costs on contracting services contracts; actuarially determined benefit costs; asset retirement obligations; ~~lease classification;~~ present value of right-of-use assets and lease liabilities; and the valuation of stock-based compensation. These estimates are based on management’s best knowledge of current events, historical experience, actions that we may undertake in the future and on various other assumptions that are believed to be reasonable under the circumstances. As additional information becomes available, or actual amounts are determinable, the recorded estimates are revised. Consequently, operating results can be affected by revisions to prior accounting estimates.

Index

Cash, cash equivalents and restricted cash

We consider all highly liquid investments with an original maturity of three months or less, when purchased, to be cash and cash equivalents. Restricted cash represents deposits held by our captive insurance company that is required by state insurance regulations to remain in the captive insurance company. Cash, cash equivalents and restricted cash on the Consolidated Balance Sheets is comprised of:

	September 30, 2024		September 30, 2023		December 31, 2023
	March 31, 2025		March 31, 2024		December 31, 2024
	(In thousands)
Cash and cash equivalents	$	~~220~~86,~~368~~118	$	84128,~~006~~359	$	~~219~~236,~~324~~799
Restricted cash	4752,~~074~~364		3242,~~153~~299		4244,~~996~~335
Cash, cash equivalents and restricted cash	$	~~267~~138,~~442~~482	$	~~116~~170,~~159~~658	$	~~262~~281,~~320~~134

Seasonality of operations

Some of our operations are seasonal and revenues from, and certain expenses for, such operations may fluctuate significantly among quarterly periods, with lower activity in the winter months and higher activity in the summer months. Accordingly, the interim results for particular segments, and for Knife River as a whole, may not be indicative of results for the full fiscal year or other future periods.

Index

Note 3 - New accounting standards

The following table provides a brief description of the accounting pronouncements applicable to Knife River and the potential impact on its consolidated financial statements and/or disclosures:

Standard	Description	Standard Effective Date	Impact on financial statements/disclosures
Recently issued Financial Accounting Standards Board (FASB) accounting standards updates ("ASU") not yet adopted
Recently adopted Financial Accounting Standards Board (FASB) accounting standards updates (ASU)
ASU 2023-07 - Improvements to Reportable Segment Disclosures	In November 2023, the FASB issued guidance on modifying the disclosure requirements to improve reportable segment disclosure requirements through enhanced disclosures about significant segment expenses. The guidance also expands the interim disclosure requirements. The guidance is to be applied on a retrospective basis to the financial statements and footnotes and early adoption is permitted.	~~Fiscal~~Adopted ~~periods~~for ~~beginning~~the ~~after~~year ~~December~~ended ~~15, 2023 and interim periods beginning after~~ December 31, 2024.	~~The~~We ~~Company~~updated isour ~~currently evaluating the impact the guidance will have on its~~ disclosures for the year ended December 31, 2024 and interim periods for ~~fiscal~~2025 ~~year~~to ~~2025~~incorporate the required changes.
ASU 2023-09 - Improvements to Income Tax Disclosures	In December 2023, the FASB issued guidance on modifying the disclosure requirements to increase transparency about income tax information through improvements to income tax disclosures primarily related to the rate reconciliation and income taxes paid information. The guidance is to be applied on a prospective basis to the financial statements and footnotes, however, retrospective adoption is also permitted. The guidance also permits early adoption.	~~Fiscal~~Adopted ~~periods~~for ~~beginning~~the ~~after~~year ended December 1531, 2024.	~~The~~We ~~Company~~updated isour ~~electing~~disclosures, towhich ~~early~~were ~~adopt~~not ~~the~~material, ~~guidance~~ for the year ended December 31, 2024~~, on a retrospective basis~~. ~~The Company has reviewed the impact to its disclosures and although not material, will have updates to the income tax footnote.~~
Recently issued ASU's not yet adopted
ASU 2024-03 -Disaggregation of Income Statement Expenses	In November 2024, the FASB issued guidance on modifying the disclosure requirements to improve the disclosures for a public entity's expenses and address requests from investors for more detailed information about the types of expenses in commonly presented expense captions. The guidance is to be applied either on a prospective basis to the financial statements issued for reporting periods after the effective date or on a retrospective basis to the financial statements to all prior periods presented in the financial statements. Early adoption is permitted.	Annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027.	We are currently evaluating the impact the guidance will have on our disclosures for the year ended December 31, 2027 and interim periods for fiscal year 2028.

~~Note 4 - Receivables and allowance for expected credit losses~~10

Receivables consist primarily of trade and contract receivables for the sale of goods and services net of expected credit losses. A majority of our receivables are due in 30 days or less. The total balance of receivables past due 90 days or more was $12.6 million, $14.4 million and $16.7 million at September 30, 2024, September 30, 2023 and December 31, 2023, respectively. Receivables were as follows:

	September 30, 2024		September 30, 2023		December 31, 2023
	(In thousands)
Trade receivables	$	229,887	$	236,373	$	124,134
Contract receivables	187,622		223,874		112,037
Retention receivables	35,980		37,814		36,782
Receivables, gross	453,489		498,061		272,953
Less expected credit loss	4,301		6,195		6,168
Receivables, net	$	449,188	$	491,866	$	266,785

The Company's expected credit losses are determined through a review using historical credit loss experience; changes in asset specific characteristics; current conditions; and reasonable and supportable future forecasts, among other specific account data, and is performed at least quarterly. We develop and document our methodology to determine our allowance for expected credit losses. Risk characteristics used by management may include customer mix, knowledge of customers and general economic conditions of the various local economies, among others. Specific account balances are written off when management determines the amounts to be uncollectible. Management has reviewed the balance reserved through the allowance for expected credit losses and believes it is reasonable.

Index

~~Details~~Note of4 ~~the~~- ~~Company's~~Receivables ~~expected~~and ~~credit~~allowance ~~losses~~for ~~were~~expected ascredit ~~follows:~~losses

	Pacific		Northwest		Mountain		Central		Energy Services		Total
	(In thousands)
As of December 31, 2023	$	2,053	$	1,004	$	2,293	$	718	$	100	$	6,168
Current expected credit loss provision	177		(223)		(47)		87		—		(6)
Less write-offs charged against the allowance	(53)		133		2		3		—		85
At March 31, 2024	$	2,283	$	648	$	2,244	$	802	$	100	$	6,077
Current expected credit loss provision	25		79		27		151		1		283
Less write-offs charged against the allowance	513		11		1,122		212		1		1,859
At June 30, 2024	$	1,795	$	716	$	1,149	$	741	$	100	$	4,501
Current expected credit loss provision	126		(19)		(5)		223		1		326
Less write-offs charged against the allowance	74		108		233		106		5		526
At September 30, 2024	$	1,847	$	589	$	911	$	858	$	96	$	4,301

Receivables consist primarily of trade and contract receivables for the sale of goods and services net of expected credit losses. A majority of our receivables are due in 30 days or less. The total balance of receivables past due 90 days or more was $27.3 million, $12.6 million and $14.3 million at March 31, 2025, March 31, 2024 and December 31, 2024, respectively. Receivables were as follows:

	Pacific		Northwest		Mountain		Central		Energy Services		Total
	March 31, 2025		March 31, 2024		December 31, 2024
	(In thousands)
As of December 31, 2022	$	1,945	$	1,253	$	1,278	$	901	$	100	$	5,477
Trade receivables	$	122,828	$	107,834	$	134,480
Current expected credit loss provision	45		313		164		(90)		—		432
Contract receivables	85,939		50,427		104,547
Less write-offs charged against the allowance	1		68		18		—		—		87
Retention receivables	33,617		31,524		32,558
At March 31, 2023	$	1,989	$	1,498	$	1,424	$	811	$	100	$	5,822
Receivables, gross	242,384		189,785		271,585
Current expected credit loss provision	8		74		631		(131)		1		583
Less expected credit loss	4,318		6,077		4,345
Less write-offs charged against the allowance	17		512		3		2		1		535
Receivables, net	$	238,066	$	183,708	$	267,240
At June 30, 2023	$	1,980	$	1,060	$	2,052	$	678	$	100	$	5,870
Current expected credit loss provision	46		242		(152)		235		—		371
Less write-offs charged against the allowance	26		4		13		3		—		46
At September 30, 2023	$	2,000	$	1,298	$	1,887	$	910	$	100	$	6,195

Our expected credit losses are determined through a review using historical credit loss experience; changes in asset specific characteristics; current conditions; and reasonable and supportable future forecasts, among other specific account data, and is performed at least quarterly. We develop and document our methodology to determine our allowance for expected credit losses. Risk characteristics used by management may include customer mix, knowledge of customers and general economic conditions of the various local economies, among others. Specific account balances are written off when management determines the amounts to be uncollectible. Management has reviewed the balance reserved through the allowance for expected credit losses and believes it is reasonable.

Details of our expected credit losses were as follows:


	West		Mountain		Central		Energy Services		Total
	(In thousands)
As of December 31, 2024	$	2,478	$	780	$	921	$	166	$	4,345
Current expected credit loss provision	—		42		30		263		335
Less write-offs charged against the allowance	73		8		18		263		362

At March 31, 2025	$	2,405	$	814	$	933	$	166	$	4,318


	West		Mountain		Central		Energy Services		Total
	(In thousands)
As of December 31, 2023	$	3,057	$	2,293	$	718	$	100	$	6,168
Current expected credit loss provision	(46)		(47)		87		—		(6)
Less write-offs charged against the allowance	80		2		3		—		85

At March 31, 2024	$	2,931	$	2,244	$	802	$	100	$	6,077

Note 5 - Inventories

Inventories on the Consolidated Balance Sheets were as follows:

	September 30, 2024		September 30, 2023		December 31, 2023
	March 31, 2025		March 31, 2024		December 31, 2024
	(In thousands)
Finished products	$	~~240~~299,~~746~~032	$	~~213~~242,~~702~~952	$	~~225~~252,~~319~~563
Raw materials	67126,~~830~~949		6395,~~156~~132		6191,~~776~~334
Supplies and parts	3841,~~724~~070		37,~~853~~699		3236,~~528~~439
Total	$	~~347~~467,~~300~~051	$	~~314~~375,~~711~~783	$	~~319~~380,~~623~~336

Inventories are valued at the lower of cost or net realizable value using the average cost method. Inventories include production costs incurred as part of our aggregate mining activities. These inventoriable production costs include all mining and processing costs associated with the production of aggregates. Stripping costs incurred during the production phase, which represent costs of removing overburden and waste materials to access mineral deposits, are a component of inventoriable production costs.

1311

Index

Note 6 - Net ~~income~~loss per share

Basic net ~~income~~loss per share is computed by dividing net ~~income~~loss by the weighted average number of shares of common stock outstanding during the applicable period. Diluted ~~net~~earnings ~~income~~ per share is computed by dividing net income by the total of the weighted average number of shares of common stock outstanding during the applicable period, plus the effect of non-vested performance shares and restricted stock units. Our potentially dilutive securities have been excluded from the computation of diluted net loss per share as the effect would reduce the net loss per share and is considered antidilutive. Weighted average common shares outstanding is comprised of issued shares of 57,~~043~~083,~~841~~497 less shares held in treasury of 431,136. Basic and diluted net ~~income~~loss per share are calculated as follows, based on a reconciliation of the weighted-average common shares outstanding on a basic and diluted basis:

	Three Months Ended				~~Nine Months Ended~~
	September 30,				September 30,
	March 31,
	2024		2023		2024		2023
	2025		2024
	(In thousands, except per share amounts)
Net income	$	148,104	$	146,655	$	178,405	$	162,171
Net loss	$	(68,710)	$	(47,629)
Weighted average common shares outstanding - basic	56,~~613~~626		56,~~566~~590		~~56,605~~		~~56,566~~
Effect of dilutive performance shares and restricted stock units	~~258~~—		~~169~~—		~~204~~		67
Weighted average common shares outstanding - diluted	56,~~871~~626		56,~~735~~590		~~56,809~~		~~56,633~~
Shares excluded from the calculation of diluted loss per share	—274		—179		—		—
Net income per share - basic	$	2.62	$	2.59	$	3.15	$	2.87
Net loss per share - basic	$	(1.21)	$	(.84)
Net income per share - diluted	$	2.60	$	2.58	$	3.14	$	2.86
Net loss per share - diluted	$	(1.21)	$	(.84)

Note 7 - Accumulated other comprehensive loss

Comprehensive income (loss) is comprised of net income (loss) and other comprehensive income (loss). The ~~after-tax~~only ~~changes~~component inof other comprehensive income (loss) is the ~~components~~amortization of postretirement liability losses for our benefit plans. As of March 31, 2025 and 2024, and December 31, 2024, accumulated other comprehensive loss ~~were~~was as$9.2 ~~follows:~~million, $11.2 million and $9.3 million, respectively.

	Net UnrealizedLoss onDerivative Instruments Qualifying asHedges		Postretirement LiabilityAdjustment		TotalAccumulated OtherComprehensive Loss
	(In thousands)
As of December 31, 2023	$	—	$	(11,319)	$	(11,319)
Amounts reclassified from accumulated other comprehensive loss	—		78		78
Net current-period other comprehensive income	—		78		78
At March 31, 2024	$	—	$	(11,241)	$	(11,241)
Amounts reclassified from accumulated other comprehensive loss	—		77		77
Net current-period other comprehensive income	—		77		77
At June 30, 2024	$	—	$	(11,164)	$	(11,164)
Amounts reclassified from accumulated other comprehensive loss	—		78		78
Net current-period other comprehensive income	—		78		78
At September 30, 2024	$	—	$	(11,086)	$	(11,086)

For the three months ended March 31, 2025 and 2024, we amortized $63,000 and $78,000, respectively, of expense into other income, and $20,000 and $25,000, respectively, into income taxes.

Index

	Net UnrealizedLoss onDerivative Instruments Qualifying asHedges		Postretirement LiabilityAdjustment		TotalAccumulated OtherComprehensive Loss
	(In thousands)
As of December 31, 2022	$	(90)	$	(12,262)	$	(12,352)
Amounts reclassified from accumulated other comprehensive loss	46		47		93
Net current-period other comprehensive income	46		47		93
At March 31, 2023	$	(44)	$	(12,215)	$	(12,259)
Other comprehensive loss before reclassification	—		(17)		(17)
Amounts reclassified from accumulated other comprehensive loss	44		48		92
Net current-period other comprehensive income	44		31		75
At June 30, 2023	$	—	$	(12,184)	$	(12,184)
Amounts reclassified from accumulated other comprehensive loss	—		49		49
Net current-period other comprehensive income	—		49		49
At September 30, 2023	$	—	$	(12,135)	$	(12,135)

The following amounts were reclassified out of accumulated other comprehensive loss into net income. The amounts presented in parenthesis indicate a decrease to net income on the Consolidated Statements of Operations. The reclassifications were as follows:

	Three Months Ended				Nine Months Ended				Location on Consolidated Statements of Operations
	September 30,				September 30,
	2024		2023		2024		2023
	(In thousands)
Reclassification adjustment for loss on derivative instruments included in net income	$	—	$	—	$	—	$	(118)	Interest expense
	—		—		—		28		Income taxes
	—		—		—		(90)
Amortization of postretirement liability losses included in net periodic benefit cost	(103)		(65)		(308)		(191)		Other income
	25		16		75		47		Income taxes
	(78)		(49)		(233)		(144)
Total reclassifications	$	(78)	$	(49)	$	(233)	$	(234)

Index

Note 8 - Revenue from contracts with customers

Revenue is recognized when a performance obligation is satisfied by transferring control over a product or service to a customer. Revenue includes revenue from the sales of construction materials and contracting services. Revenue is measured based on consideration specified in a contract with a customer and excludes any sales incentives and amounts collected on behalf of third parties. Knife River is considered an agent for certain taxes collected from customers. As such, we present revenues net of these taxes at the time of sale to be remitted to governmental authorities, including sales and use taxes. Revenue for construction materials is recognized at a point in time when delivery of the products has taken place. Contracting revenue is recognized over time using an input method based on the cost-to-cost measure of progress on a project.

~~Disaggregation~~12

In the following tables, revenue is disaggregated by category for each segment and includes sales of materials to both third parties and internal customers. Due to consolidation requirements, the internal sales revenues must be eliminated against the construction materials product used in downstream materials and contracting services to arrive at the external operating revenues. We believe this level of disaggregation best depicts how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. For more information on the Company’s reportable segments, see Note 14.

Three Months Ended September 30, 2024	Pacific		Northwest		Mountain		Central		Energy Services		Corporate Services and Eliminations		Total
	(In thousands)
Aggregates	$	36,642	$	54,038	$	40,115	$	62,685	$	—	$	—	$	193,480
Ready-mix concrete	40,428		46,999		40,559		85,474		—		—		213,460
Asphalt	11,859		47,170		60,022		95,998		—		—		215,049
Liquid asphalt	—		—		—		—		110,917		—		110,917
Other	48,028		5,416		9		12,242		20,877		3,132		89,704
Contracting services public-sector	48,435		89,271		142,864		198,843		—		—		479,413
Contracting services private-sector	9,316		17,545		42,830		10,478		—		—		80,169
Internal sales	(29,722)		(42,614)		(65,281)		(110,905)		(25,308)		(3,069)		(276,899)
Revenues from contracts with customers	$	164,986	$	217,825	$	261,118	$	354,815	$	106,486	$	63	$	1,105,293

Three Months Ended September 30, 2023	Pacific		Northwest		Mountain		Central		Energy Services		Corporate Services and Eliminations		Total
	(In thousands)
Aggregates	$	33,624	$	57,398	$	39,519	$	63,044	$	—	$	—	$	193,585
Ready-mix concrete	39,861		46,785		44,053		85,340		—		—		216,039
Asphalt	14,050		43,462		59,673		105,592		—		—		222,777
Liquid asphalt	—		—		—		—		122,596		—		122,596
Other	49,533		4,497		11		10,214		21,797		5,464		91,516
Contracting services public-sector	32,632		68,316		135,700		205,262		—		—		441,910
Contracting services private-sector	17,745		25,144		43,944		8,572		—		—		95,405
Internal sales	(30,116)		(36,683)		(68,178)		(123,099)		(28,972)		(6,408)		(293,456)
Revenues from contracts with customers	$	157,329	$	208,919	$	254,722	$	354,925	$	115,421	$	(944)	$	1,090,372

Nine Months Ended September 30, 2024	Pacific		Northwest		Mountain		Central		Energy Services		Corporate Services and Eliminations		Total
	(In thousands)
Aggregates	$	87,450	$	146,497	$	80,708	$	121,499	$	—	$	—	$	436,154
Ready-mix concrete	108,316		124,435		89,361		170,722		—		—		492,834
Asphalt	22,828		87,937		93,712		146,324		—		—		350,801
Liquid asphalt	—		—		—		—		187,256		—		187,256
Other	115,714		14,563		22		25,015		38,325		12,786		206,425
Contracting services public-sector	74,623		196,614		258,746		322,696		—		—		852,679
Contracting services private-sector	31,612		58,173		98,185		16,202		—		—		204,172
Internal sales	(65,342)		(91,017)		(106,021)		(172,079)		(41,735)		(12,338)		(488,532)
Revenues from contracts with customers	$	375,201	$	537,202	$	514,713	$	630,379	$	183,846	$	448	$	2,241,789

Index

Nine Months Ended September 30, 2023	Pacific		Northwest		Mountain		Central		Energy Services		Corporate Services and Eliminations		Total
	(In thousands)
Aggregates	$	79,768	$	147,937	$	78,051	$	117,766	$	—	$	—	$	423,522
Ready-mix concrete	106,531		125,273		92,929		172,973		—		—		497,706
Asphalt	21,640		84,908		89,955		164,830		—		—		361,333
Liquid asphalt	—		—		—		—		203,802		—		203,802
Other	112,755		11,513		21		22,709		37,838		7,231		192,067
Contracting services public-sector	53,450		138,621		244,320		342,146		—		—		778,537
Contracting services private-sector	37,220		80,258		94,706		15,015		—		—		227,199
Internal sales	(63,313)		(84,937)		(108,888)		(191,860)		(44,900)		(6,806)		(500,704)
Revenues from contracts with customers	$	348,051	$	503,573	$	491,094	$	643,579	$	196,740	$	425	$	2,183,462

Disaggregation


Three Months Ended March 31, 2025	West		Mountain		Central		Energy Services		Corporate Services and Eliminations		Total
	(In thousands)
Aggregates	$	56,257	$	8,043	$	17,092	$	—	$	—	$	81,392
Ready-mix concrete	69,780		13,087		25,591		—		—		108,458
Asphalt	8,866		498		6,770		—		—		16,134
Liquid asphalt	—		—		—		12,228		—		12,228
Other	34,406		3		2,418		2,995		3,669		43,491
Contracting services public-sector	38,772		36,179		24,276		—		—		99,227
Contracting services private-sector	28,836		11,829		172		—		—		40,837
Internal sales	(28,899)		(3,645)		(8,478)		(3,678)		(3,596)		(48,296)
Revenues from contracts with customers	$	208,018	$	65,994	$	67,841	$	11,545	$	73	$	353,471


Three Months Ended March 31, 2024	West		Mountain		Central		Energy Services		Corporate Services and Eliminations		Total
	(In thousands)
Aggregates	$	58,947	$	9,455	$	15,871	$	—	$	—	$	84,273
Ready-mix concrete	62,996		13,835		23,024		—		—		99,855
Asphalt	10,584		830		5,059		—		—		16,473
Liquid asphalt	—		—		—		11,035		—		11,035
Other	28,904		5		1,898		3,062		5,142		39,011
Contracting services public-sector	41,519		25,859		21,033		—		—		88,411
Contracting services private-sector	23,105		13,803		176		—		—		37,084
Internal sales	(28,516)		(3,962)		(6,097)		(2,981)		(4,996)		(46,552)
Revenues from contracts with customers	$	197,539	$	59,825	$	60,964	$	11,116	$	146	$	329,590

Note 9 - Uncompleted contracts

The timing of revenue recognition may differ from the timing of invoicing to customers. The timing of invoicing to customers does not necessarily correlate with the timing of revenues being recognized under the cost-to-cost method of accounting. Contracts from contracting services are billed as work progresses in accordance with agreed upon contractual terms. Generally, billing to the customer occurs contemporaneous to revenue recognition. A variance in timing of the billings may result in a contract asset or a contract liability. A contract asset occurs when revenues are recognized under the cost-to-cost measure of progress, which exceeds amounts billed on uncompleted contracts. Such amounts will be billed as standard contract terms allow, usually based on various measures of performance or achievement. A contract liability occurs when there are billings in excess of revenues recognized under the cost-to-cost measure of progress on uncompleted contracts. Contract liabilities decrease as revenue is recognized from the satisfaction of the related performance obligation.

The changes in contract assets and liabilities were as follows:

	September 30, 2024		December 31, 2023		Change		Location on Consolidated Balance Sheets
	March 31, 2025		December 31, 2024		Change		Location on Consolidated Balance Sheets
	(In thousands)
Contract assets	$	6928,~~309~~505	$	2731,~~293~~283	$	42(2,~~016~~778)	Costs and estimated earnings in excess of billings on uncompleted contracts
Contract liabilities	(4442,~~786~~016)		(5142,~~376~~126)		~~6,590~~110		Billings in excess of costs and estimated earnings on uncompleted contracts
Net contract assets (liabilities)	$	24,523	$	(24,083)	$	48,606
Net contract liabilities	$	(13,511)	$	(10,843)	$	(2,668)

	September 30, 2023		December 31, 2022		Change		Location on Consolidated Balance Sheets
	(In thousands)
Contract assets	$	50,545	$	31,145	$	19,400	Costs and estimated earnings in excess of billings on uncompleted contracts
Contract liabilities	(58,785)		(39,843)		(18,942)		Billings in excess of costs and estimated earnings on uncompleted contracts
Net contract liabilities	$	(8,240)	$	(8,698)	$	458

The Company recognized $3.9 million and $48.8 million in revenue for the three and nine months ended September 30, 2024, respectively, which was previously included in contract liabilities at December 31, 2023. The Company recognized $3.4 million and $35.1 million in revenue for the three and nine months ended September 30, 2023, respectively, which was previously included in contract liabilities at December 31, 2022.

The Company recognized a net increase in revenues of $15.9 million and $28.6 million for the three and nine months ended September 30, 2024, respectively, from performance obligations satisfied in prior periods. The Company recognized a net increase in revenues of $12.1 million and $10.6 million for the three and nine months ended September 30, 2023, respectively, from performance obligations satisfied in prior periods.

Index


	March 31, 2024		December 31, 2023		Change		Location on Consolidated Balance Sheets
	(In thousands)
Contract assets	$	33,559	$	27,293	$	6,266	Costs and estimated earnings in excess of billings on uncompleted contracts
Contract liabilities	(50,844)		(51,376)		532		Billings in excess of costs and estimated earnings on uncompleted contracts
Net contract liabilities	$	(17,285)	$	(24,083)	$	6,798

We recognized $28.2 million in revenue for the three months ended March 31, 2025, which was previously included in contract liabilities at December 31, 2024. We recognized $30.5 million in revenue for the three months ended March 31, 2024, which was previously included in contract liabilities at December 31, 2023.

We recognized a net increase in revenues of $8.0 million and $9.2 million for the three months ended March 31, 2025 and 2024, respectively, from performance obligations satisfied in prior periods.

Remaining performance obligations

The remaining performance obligations, also referred to as backlog, include unrecognized revenues that we reasonably expect to be realized. These unrecognized revenues can include: projects that have a written award, a letter of intent, a notice to proceed, an agreed upon work order to perform work on mutually accepted terms and conditions, and change orders or claims to the extent management believes additional contract revenues will be earned and are deemed probable of collection. The majority of our contracts for contracting services have an original duration of less than one year.

At ~~September~~March 3031, ~~2024~~2025, ~~the~~our ~~Company's~~ remaining performance obligations were $~~755~~938.17 million. We expect to recognize the following revenue amounts in future periods related to these remaining performance obligations: $~~688~~820.86 million within the next 12 months or less; $5591.15 million within the next 13 to 24 months; and $1126.26 million in 25 months or more.

Note 10 - ~~Goodwill~~Acquisitions and ~~other intangible assets~~Dispositions

Acquisitions

The following acquisitions were accounted for as business combinations in accordance with ASC 805 - Business Combinations. The results of the business combinations have been included in the Company's Consolidated Financial Statements beginning on the acquisition dates. Pro forma financial amounts reflecting the effects of the business combinations are not presented, as none of these business combinations, individually or in the aggregate, were material to our financial position or results of operations.

Acquisitions are also subject to customary adjustments based on, among other things, the amount of cash, debt and working capital in the business as of the closing date. The amounts included in the Consolidated Balance Sheets for these adjustments are considered provisional until final settlement has occurred.

Strata Corporation

On March 7, 2025, we completed the acquisition of Strata Corporation, a leading construction materials and contracting services provider in North Dakota and northwestern Minnesota. The purchase of Strata includes operations that expand our aggregates, ready-mix and asphalt operations, as well as our trucking fleet, locomotives and railcars, in our current geographic locations. The purchase price for Strata totaled $454.0 million and is subject to post-closing adjustments. The results of Strata are included in our Central segment.

The estimated fair value of the assets acquired and liabilities assumed are preliminary, as we continue to gather information to finalize the valuation of these assets and liabilities. The fair values are considered provisional until final fair values are determined, or the measurement period has passed. We expect to record adjustments as we accumulate the information needed to estimate the fair value of assets acquired and liabilities assumed, including working capital balances, estimated fair value of identifiable intangible assets, property, plant and equipment, total consideration and goodwill. We utilized market and cost approaches to estimate the fair value of the property, plant and equipment, excluding aggregate reserves. The fair value of aggregate reserves and intangible assets were determined using the income approach. All estimates, key assumptions, and forecasts were either provided by or reviewed by management. We engaged third-party valuation firms to assist in the analysis and valuation of the assets of Strata. While we chose to utilize third-party valuation firms, the fair value analysis and related valuations represent the conclusions of management and not the conclusions or statements of any third party.

The excess of the total purchase price over the fair value of assets acquired and liabilities assumed was allocated to goodwill. We believe that the goodwill relates to several factors, including potential synergies related to market opportunities for multiple product offerings and economies of scale expected from combining our operations with the business acquired.

The final fair value of the net assets acquired may result in adjustments to the assets and liabilities, including goodwill, and will be made as soon as practical, but no later than one year from the respective acquisition dates. However, any subsequent measurement period adjustments are not expected to have a material impact on our results of operations.

Index

The preliminary allocation of the purchase price for Strata is as follows:


	As of March 31, 2025
(In thousands)
Assets
Current assets:
Cash and cash equivalents	$	7,906
Receivables	8,374
Costs and estimated earnings in excess of billings on uncompleted contracts	4,390
Inventories	36,355
Assets held for sale	21,093
Prepayments and other current assets	4,850
Total current assets	82,968
Noncurrent assets:
Property, plant and equipment	266,370
Goodwill	152,329
Other intangible assets	13,600
Operating lease right-of-use assets	53
Total noncurrent assets	432,352
Total assets acquired	$	515,320
Liabilities
Current liabilities:
Accounts payable	$	3,312
Billings in excess of costs and estimated earnings on uncompleted contracts	921
Current operating lease liabilities	29
Other accrued liabilities	21,378
Total current liabilities	25,640
Noncurrent liabilities:
Deferred income taxes	45,092
Noncurrent operating lease liabilities	3,293
Total noncurrent liabilities	48,385
Total liabilities assumed	74,025
Total consideration (fair value)	$	441,295

Intangible assets for Strata include $9.5 million for customer backlog, which has an amortization period of 10 months, and $4.1 million for permits, which has an amortization period of 10 years upon commencement of operations.

Other

During the first quarter of 2025, we completed the acquisition of an aggregate quarry operation in Washington for $10.1 million, which will supply aggregates to Southern Washington and Northern Oregon. The acquisition resulted in the recognition of $15.1 million of assets in property, plant and equipment, $1.3 million deferred income tax liability and $202,000 in noncurrent liabilities - other. We have reviewed the fair values of the assets and liabilities and determined that the purchase would result in a gain being recognized at the time of the acquisition. We believe the bargain purchase gain was primarily the result of the sellers’ desire to exit quickly due to cash flow constraints which were limiting their ability to operate the business efficiently. The gain on the purchase was $3.5 million, net of deferred taxes of $1.3 million, and was recorded in other income on the Consolidated Statement of Operations. The results of this acquisition are included in our West segment.

During 2024, we completed four acquisitions with an aggregated purchase price of $120.7 million, subject to future post-closing adjustments. As of March 31, 2025, the purchase accounting for Albina Asphalt is considered preliminary and will be completed in the second quarter of 2025.

For the three months ended March 31, 2025, we incurred acquisition-related costs on completed and other potential acquisitions of $5.3 million. These costs are included in our Corporate Services in selling, general and administrative expenses on the Consolidated Statement of Operations.

Index

Dispositions

On March 7, 2025, we sold four ready-mix plant operations for total proceeds of $14.5 million. The ready-mix plant operations were acquired by us as part of the Strata acquisition and subsequently sold to a third-party. The ready-mix plants were included in assets held for sale on the opening balance sheet for Strata at the time of the acquisition.

Note 11 - Goodwill and other intangible assets

The changes in the carrying amount of goodwill were as follows:

	Balance at January 1, 2024		Goodwill Acquired During the Year		Measurement Period Adjustments		Reallocation of Goodwill		Balance at September 30, 2024
	Balance at January 1, 2025		Goodwill Acquired During the Year		Measurement Period Adjustments		Reallocation of Goodwill		Balance at March 31, 2025
	(In thousands)
Pacific	$	32,621	$	43	$	—	$	—	$	32,664
West	$	123,674	$	—	$	—	$	—	$	123,674
Northwest	90,978		—		—		—		90,978
Mountain	26,816		—		—		—		26,816
North Central	75,879		735		—		—		76,614
Central	115,322		152,329		—		—		267,651
South	38,708		—		—		—		38,708
Energy Services	31,413		—		—		—		31,413
Energy Services	9,476		—		—		—		9,476
Total	$	297,225	$	152,329	$	—	$	—	$	449,554
Total	$	274,478	$	778	$	—	$	—	$	275,256

	Balance at January 1, 2023		Goodwill Acquired During the Year		Measurement Period Adjustments		Reallocation of Goodwill		Balance at September 30, 2023
	Balance at January 1, 2024		Goodwill Acquired During the Year		Measurement Period Adjustments		Reallocation of Goodwill		Balance at March 31, 2024
	(In thousands)
Pacific	$	38,339	$	—	$	(62)	$	—	$	38,277
West	$	123,599	$	—	$	—	$	—	$	123,599
Northwest	90,978		—		—		—		90,978
Mountain	26,816		—		—		—		26,816
North Central	75,879		—		—		—		75,879
Central	114,587		—		—		—		114,587
South	38,708		—		—		—		38,708
Energy Services	9,476		—		—		—		9,476
Energy Services	3,820		—		—		—		3,820
Total	$	274,478	$	—	$	—	$	—	$	274,478
Total	$	274,540	$	—	$	(62)	$	—	$	274,478

	Balance at January 1, 2023		Goodwill Acquired During the Year		Measurement Period Adjustments		Reallocation of Goodwill		Balance at December 31, 2023
	Balance at January 1, 2024		Goodwill Acquired During the Year		Measurement Period Adjustments		Reallocation of Goodwill		Balance at December 31, 2024
	(In thousands)
Pacific	$	38,339	$	—	$	(62)	$	(5,656)	$	32,621
West	$	123,599	$	75	$	—	$	—	$	123,674
Northwest	90,978		—		—		—		90,978
Mountain	26,816		—		—		—		26,816
North Central	75,879		—		—		—		75,879
Central	114,587		735		—		—		115,322
South	38,708		—		—		—		38,708
Energy Services	9,476		21,937		—		—		31,413
Energy Services	3,820		—		—		5,656		9,476
Total	$	274,478	$	22,747	$	—	$	—	$	297,225
Total	$	274,540	$	—	$	(62)	$	—	$	274,478

1816

Index

Other amortizable intangible assets were as follows:

	September 30, 2024		September 30, 2023		December 31, 2023
	March 31, 2025		March 31, 2024		December 31, 2024
	(In thousands)
Customer relationships	$	1930,~~059~~703	$	18,540	$	1830,~~540~~703
Less accumulated amortization	1011,~~419~~798		89,~~668~~535		911,~~102~~060
	8,640		9,872		9,438
	18,905		9,005		19,643
Noncompete agreements	3,~~926~~107		43,~~039~~820		43,~~039~~950
Less accumulated amortization	32,~~452~~743		3,~~358~~315		3,~~473~~524
	474		681		566
	364		505		426
Other	1,796		2,479		2,479
Tradename	7,470		—		7,470
Less accumulated amortization	~~1,056~~188		~~1,569~~—		~~1,662~~124
	740		910		817
	7,282		—		7,346
Total	$	9,854	$	11,463	$	10,821
Backlog	9,890		—		390
Less accumulated amortization	32		—		22
	9,858		—		368
Other	6,688		1,796		3,310
Less accumulated amortization	1,130		1,029		1,679
	5,558		767		1,631
Total	$	41,967	$	10,277	$	29,414

~~Amortization~~The ~~expense~~previous ~~for~~tables ~~amortizable~~include ~~intangible~~goodwill ~~assets for the three~~ and ~~nine months ended September 30, 2024, was $522,000 and $1.6 million, respectively. Amortization expense for amortizable~~ intangible assets ~~for~~associated with the ~~three~~business ~~and~~combinations ~~nine~~completed ~~months~~in ~~ended~~the ~~September 30,~~first ~~2023,~~quarter ~~was~~of ~~$647,000 and $2~~2025.0 ~~million,~~For ~~respectively.~~more ~~Estimated~~information ~~amortization~~related ~~expense~~to ~~for~~these ~~identifiable~~business ~~intangible assets as of September 30~~combinations, ~~2024,~~see ~~was:~~Note 10.

	Remainder of 2024		2025		2026		2027		2028		Thereafter
	(In thousands)
Amortization expense	$	677	$	1,991	$	1,811	$	1,789	$	1,744	$	1,842

Amortization expense for amortizable intangible assets for the three months ended March 31, 2025, and 2024 was $1.1 million and $545,000, respectively. Estimated amortization expense for identifiable intangible assets as of March 31, 2025, was:

Note 11 - Fair value measurements


	Remainder of 2025		2026		2027		2028		2029		Thereafter
	(In thousands)
Amortization expense	$	12,034	$	5,307	$	4,287	$	3,961	$	3,466	$	12,912

~~Fair~~Note ~~value~~12 is- ~~defined~~Fair ~~as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. The fair~~ value guidance establishes a hierarchy for grouping assets and liabilities, based on the significance of inputs. The estimated fair values of the Company's assets and liabilities measured on a recurring basis are determined using the market approach.measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. The fair value guidance establishes a hierarchy for grouping assets and liabilities, based on the significance of inputs. The estimated fair values of the assets and liabilities measured on a recurring basis are determined using the market approach.

Financial instruments measured at fair value on a recurring basis

We measure our investments in certain fixed-income and equity securities at fair value with changes in fair value recognized in income. We anticipate using these investments, which consist of insurance contracts, to satisfy our obligations under our unfunded, nonqualified defined benefit and defined contribution plans for our executive officers and certain key management employees, and ~~invests~~invest in these fixed-income and equity securities for the purpose of earning investment returns and capital appreciation. These investments, which totaled $2830.5 million, $2327.51 million and $2428.94 million at ~~September~~March 3031, ~~2024~~2025 and ~~2023~~2024, and December 31, ~~2023~~2024, respectively, are classified as investments on the Consolidated Balance Sheets. ~~The~~These ~~net unrealized gains on these~~ investments ~~were~~had ~~$1.3~~a ~~million and $2.9 million for the three and nine months ended September 30, 2024, respectively. The~~ net unrealized loss onof ~~these investments was~~ $~~597~~692,000 ~~for the three months ended September 30, 2023~~ and ~~the~~a net unrealized gain onof ~~these investments was~~ $~~685,000~~1.2 million for the ~~nine~~three months ended ~~September~~March 3031, ~~2023~~2025 and 2024, respectively. The change in fair value, which is considered part of the cost of the plan, is classified in other income on the Consolidated Statements of Operations.

1917

Index

The Company's assets measured at fair value on a recurring basis were as follows:

	Fair Value Measurements at September 30, 2024, Using
	Fair Value Measurements at March 31, 2025, Using
	Quoted Prices inActive Marketsfor IdenticalAssets(Level 1)		SignificantOtherObservableInputs(Level 2)		SignificantUnobservableInputs(Level 3)		Balance at ~~September~~March 3031, ~~2024~~2025
	(In thousands)
Assets:
Money market funds	$	—	$	4,~~034~~125	$	—	$	4,~~034~~125
Insurance contracts*	—		28,498		—		28,498
Insurance contracts	—		30,451		—		30,451
Total assets measured at fair value	$	—	$	3234,~~532~~576	$	—	$	3234,~~532~~576

* The insurance contracts invest approximately 36 percent in fixed-income investments, 23 percent in common stock of large-cap companies, 15 percent in cash equivalents, 10 percent in common stock of mid-cap companies, 9 percent target date investments, 5 percent in common stock of small-cap companies, 1 percent in international investments and 1 percent in real estate investments.


	Fair Value Measurements at March 31, 2024, Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Balance at March 31, 2024
	(In thousands)
Assets:
Money market funds	$	—	$	3,845	$	—	$	3,845
Insurance contracts	—		27,059		—		27,059




Total assets measured at fair value	$	—	$	30,904	$	—	$	30,904

	Fair Value Measurements at September 30, 2023, Using
	Fair Value Measurements at December 31, 2024, Using
	Quoted Prices inActive Marketsfor IdenticalAssets(Level 1)		SignificantOtherObservableInputs(Level 2)		SignificantUnobservableInputs(Level 3)		Balance at June 30, 2023
	Quoted Prices inActive Marketsfor IdenticalAssets (Level 1)		SignificantOtherObservableInputs(Level 2)		SignificantUnobservableInputs (Level 3)		Balance at December 31, 2024
	(In thousands)
Assets:
Money market funds	$	—	$	34,~~199~~082	$	—	$	34,~~199~~082
Insurance contracts*	—		23,483		—		23,483
Insurance contracts	—		28,377		—		28,377
Total assets measured at fair value	$	—	$	2632,~~682~~459	$	—	$	2632,~~682~~459

* TheOur ~~insurance~~Level ~~contracts~~2 ~~invest~~money ~~approximately~~market ~~41 percent~~funds inare ~~fixed-income~~valued ~~investments,~~at ~~19 percent~~the innet ~~cash~~asset ~~equivalents,~~value 18of ~~percent~~shares inheld ~~common~~at ~~stock~~the end of ~~large-cap~~the ~~companies~~period, ~~8 percent~~based inon ~~common~~published ~~stock~~market ofquotations ~~mid-cap~~on ~~companies~~active markets, ~~8 percent~~or ~~target~~using ~~date~~other ~~investments,~~known 5sources ~~percent~~including inpricing ~~common~~from ~~stock~~outside sources. The estimated fair value of ~~small-cap~~the ~~companies~~Level ~~and~~2 ~~1 percent~~insurance ~~international~~contracts is based on contractual cash surrender values that are determined primarily by investments in managed separate accounts of the insurer. These amounts approximate fair value. The managed separate accounts are valued based on other observable inputs or corroborated market data.

	Fair Value Measurements at December 31, 2023, Using
	Quoted Prices inActive Marketsfor IdenticalAssets (Level 1)		SignificantOtherObservableInputs(Level 2)		SignificantUnobservableInputs (Level 3)		Balance at December 31, 2023
	(In thousands)
Assets:
Money market funds	$	—	$	3,241	$	—	$	3,241
Insurance contracts*	—		24,896		—		24,896
Total assets measured at fair value	$	—	$	28,137	$	—	$	28,137

* The insurance contracts invest approximately 40 percent in fixed-income investments, 19 percent in common stock of large-cap companies, 18 percent in cash equivalents, 8 percent in target date investments, 8 percent in common stock of mid-cap companies, 6 percent in common stock of small-cap companies and 1 percent in international investments.

The Company’s Level 2 money market funds are valued at the net asset value of shares held at the end of the period, based on published market quotations on active markets, or using other known sources including pricing from outside sources. The estimated fair value of the Company’s Level 2 insurance contracts is based on contractual cash surrender values that are determined primarily by investments in managed separate accounts of the insurer. These amounts approximate fair value. The managed separate accounts are valued based on other observable inputs or corroborated market data.

Though we believe the methods used to estimate fair value are consistent with those used by other market participants, the use of other methods or assumptions could result in a different estimate of fair value.

Nonfinancial instruments measured at fair value on a nonrecurring basis

We apply the provisions of the fair value measurement standard to our nonrecurring, non-financial measurements, including long-lived asset impairments. These assets are not measured at fair value on an ongoing basis but are subject to fair value adjustments only in certain circumstances. We review the carrying value of our long-lived assets, excluding goodwill, whenever events or changes in circumstances indicate that such carrying amounts may not be recoverable.

20The assets and liabilities of the acquisitions that occurred during the first quarter of 2025 were calculated using a market or cost approach. The fair value of some of the assets was determined based on Level 3 inputs including estimated future cash flows, discount rates, growth rates and sales projections, all of which require significant management judgment. For more information on these Level 2 and 3 fair value measurements, see Note 10.

Index

~~only~~Our inlong-term ~~certain~~debt ~~circumstances.~~is Wenot ~~review~~measured at fair value on the ~~carrying~~Consolidated Balance Sheets and the fair value ofis ~~our~~being ~~long-lived~~provided ~~assets,~~for ~~excluding~~disclosure ~~goodwill,~~purposes ~~whenever~~only. ~~events~~The orfair ~~changes~~value was categorized as Level 2 in ~~circumstances~~the ~~indicate~~fair ~~that~~value ~~such~~hierarchy ~~carrying~~and ~~amounts~~was ~~may~~based ~~not~~on bediscounted ~~recoverable~~cash flows using current market interest rates. The estimated fair value of our Level 2 long-term debt was as follows:

The assets and liabilities of the acquisitions that occurred during the third quarter of 2024 were calculated using a market or cost approach. The fair value of some of the assets was determined based on Level 3 inputs including estimated future cash flows, discount rates, growth rates and sales projections, all of which require significant management judgment.


	March 31, 2025		March 31, 2024		December 31, 2024
	(In thousands)
Carrying amount	$	1,189,931	$	695,247	$	689,950
Fair value	$	1,208,611	$	715,962	$	707,853

The Company's long-term debt is not measured at fair value on the Consolidated Balance Sheets and the fair value is being provided for disclosure purposes only. The fair value was categorized as Level 2 in the fair value hierarchy and was based on discounted cash flows using current market interest rates. The estimated fair value of the Company's Level 2 long-term debt was as follows:

	September 30, 2024		September 30, 2023		December 31, 2023
	(In thousands)
Carrying amount	$	691,717	$	698,747	$	696,985
Fair value	$	719,351	$	700,687	$	725,086

The carrying amounts of our remaining financial instruments included in current assets and current liabilities approximate their fair values.

Note 1213 - Debt

Certain debt instruments of ~~the~~ours ~~Company~~ contain restrictive covenants and cross-default provisions. In order to borrow under the debt agreements, we must be in compliance with the applicable covenants and certain other conditions, all of which ~~the~~management ~~Company~~believes we, as applicable, ~~was~~were in compliance with at ~~September~~March 3031, ~~2024~~2025. In the event we do not comply with the applicable covenants and other conditions, alternative sources of funding may need to be pursued.

On March 7, 2025, we entered into an amendment to the senior secured credit agreement to, among other things, increase our revolving credit facility from $350.0 million to $500.0 million and extend the maturity to March 7, 2030, refinance the existing $275.0 million Term Loan A to extend the maturity to March 7, 2030, and provide for a new Term Loan B in an aggregate principal amount of $500.0 million with a maturity of March 8, 2032. The Term Loan B was funded on March 7, 2025. Each facility has a SOFR-based interest rate. The Term Loan A has a mandatory annual amortization of 2.50 percent for years one and two, 5.00 percent for years three and four, and 7.50 percent in the fifth year. The Term Loan B has a mandatory annual amortization of $5.0 million. The agreement contains customary covenants and provisions, including a covenant of Knife River not to permit, at any time, the ratio of total debt to trailing twelve month earnings before interest, taxes, depreciation, depletion and amortization (EBITDA) to be greater than 4.75 to 1.00. The covenants also include restrictions on the sale of certain assets, loans and investments.

Long-term Debt Outstanding Long-term debt outstanding was as follows:

	WeightedAverageInterestRate atSeptember 30, 2024		September 30, 2024		September 30, 2023		December 31, 2023
	WeightedAverageInterestRate atMarch 31, 2025		March 31, 2025		March 31, 2024		December 31, 2024
			(In thousands)
Term loan agreement due on May 31, 2028	6.45	%	$	266,406	$	273,281	$	271,562
Term loan A agreement due on March 7, 2030	6.05	%	$	264,688	$	269,844	$	264,688
Term loan B agreement due on March 8, 2032	6.29	%	500,000		—		—
Senior notes due on May 1, 2031	7.75	%	425,000		425,000		425,000
Other notes due on January 1, 2061	—	%	~~311~~243		~~466~~403		~~423~~262
Less unamortized debt issuance costs			1317,~~254~~766		1614,~~016~~636		1512,~~326~~564
Total long-term debt			~~678~~1,~~463~~172,165		~~682~~680,~~731~~611		~~681~~677,~~659~~386
Less current maturities			811,~~791~~780		7,~~082~~072		710,~~082~~475
Net long-term debt			$	~~669~~1,~~672~~160,385	$	~~675~~673,~~649~~539	$	~~674~~666,~~577~~911

Schedule of Debt Maturities Long-term debt maturities, which excludes unamortized debt issuance costs, at ~~September~~March 3031, ~~2024~~2025, were as follows:

	Remainder of2024		2025		2026		2027		2028		Thereafter
	Remainder of2025		2026		2027		2028		2029		Thereafter
	(In thousands)
Long-term debt maturities	$	18,~~916~~875	$	1011,~~425~~698	$	1316,~~750~~580	$	1718,~~188~~235	$	~~223~~23,~~438~~197	$	~~425~~1,~~000~~111,346

2119

Index

Note 1314 - Cash flow information

Cash expenditures for interest and income taxes were as follows:

	Nine Months Ended
	Three Months Ended
	September 30,
	March 31,
	2024		2023
	2025		2024
	(In thousands)
Interest paid, net	$	354,~~321~~731	$	325,~~028~~764
Income taxes paid, net	$	332,~~362~~883	$	~~22,183~~—

Noncash investing and financing transactions were as follows:

	Nine Months Ended
	Three Months Ended
	September 30,
	March 31,
	2024		2023
	2025		2024
	(In thousands)
Right-of-use assets obtained in exchange for new operating lease liabilities	$	151,~~130~~179	$	94,~~717~~802
Property, plant and equipment additions in accounts payable	$	15,~~770~~023	$	26,~~832~~046
Equity contribution from Centennial related to the Separation	$	—	$	64,724
Equity contribution to MDU Resources for asset/liability transfers related to the Separation	$	—	$	(1,548)
MDU Resources' stock issued prior to spin in connection with a business combination	$	—	$	383

Note 1415 - Business segment data

WeIn ~~focus~~January on2025, ~~the~~we ~~vertical~~made ~~integration~~a ofchange to our ~~products~~organizational ~~and~~structure ~~services~~to bybetter ~~offering~~align ~~customers~~with aour ~~single~~business ~~source~~strategy. ~~for~~We ~~construction~~reorganized ~~materials~~our ~~and~~business ~~related~~segments ~~contracting~~to ~~services.~~reflect Wechanges ~~operate~~ in ~~14 states across~~ the ~~United~~way ~~States through~~ our chief operating ~~segments:~~decision ~~Pacific,~~maker ~~Northwest,~~evaluates ~~Mountain~~performance, ~~North~~makes ~~Central,~~operating ~~South~~decisions and ~~Energy~~allocates ~~Services~~resources. ~~These~~Our former Pacific and Northwest operating segments ~~are~~were ~~used~~combined to ~~determine~~form the ~~Company’s~~new ~~reportable~~West ~~segments,~~operating ~~Pacific,~~segment. ~~Northwest,~~Our ~~Mountain,~~former North Central and ~~Energy~~South ~~Services,~~operating ~~which~~segments ~~are~~were ~~based~~combined onto ~~our~~form ~~method~~the ofnew ~~internal~~Central ~~reporting~~operating ~~and~~segment. ~~management~~The ofreorganization ~~our~~resulted ~~business.~~in ~~Four~~four ofoperating ~~the reportable~~ segments: ~~are~~West, ~~aligned~~Mountain, byCentral ~~key~~and ~~geographic~~Energy ~~areas~~Services, ~~due~~each ~~to the production~~ of ~~construction~~which ~~materials and related contracting services and one~~ is ~~based~~also ona ~~product~~reportable ~~line~~segment. Each segment’s performance is ~~led~~evaluated bybased aon segment ~~manager~~results ~~who~~without ~~reports~~allocating tocorporate ~~the Company’s chief operating officer~~expenses, ~~who~~which isinclude ~~also~~corporate ~~the~~costs ~~Company's~~associated ~~chief~~with ~~operating~~accounting, ~~decision~~legal, ~~maker~~treasury, ~~along~~business ~~with~~development, ~~the~~information ~~chief~~technology, ~~executive~~human ~~officer.~~resources, ~~The~~and ~~chief~~other ~~operating~~corporate ~~decision~~expenses ~~maker~~that ~~evaluates~~support the ~~performance~~operating ~~of the~~ segments ~~and allocates resources to them based on earnings before interest, taxes, depreciation, depletion and amortization ("EBITDA")~~.

InThree ~~the fourth quarter~~ of ~~2023, we realigned~~ our reportable segments toare ~~better~~aligned ~~support~~by ~~our~~key ~~operational~~geographic ~~strategies.~~areas ~~The~~due ~~liquid~~to ~~asphalt~~the production of construction materials and related contracting services ~~portion~~and ofone ~~the~~is ~~Pacific~~based ~~segment's~~on ~~businesses~~product ~~are~~line. ~~now~~Each ~~reported~~segment ~~under~~is ~~the~~led ~~Energy~~by ~~Services~~a segment. Inmanager ~~addition,~~who ~~the~~reports ~~North~~to ~~Central~~the ~~and~~Company’s ~~South~~chief operating ~~regions~~officer, ~~have~~who ~~been~~is ~~aggregated~~also ~~into~~the ~~one~~Company's ~~reportable~~chief ~~segment~~operating decision maker, ~~Central~~along with the chief executive officer. WeOur ~~also~~chief ~~reallocated~~operating ~~certain~~decision ~~amounts~~maker uses EBITDA to evaluate the ~~operating~~performance ~~segments~~of ~~that~~the ~~were~~segments, ~~previously~~perform ~~reported~~analytical ~~within~~comparisons ~~Corporate~~to ~~Services.~~budget ~~All~~and ~~periods~~uses ~~have~~historical ~~been~~and ~~recast~~projected EBITDA to ~~conform~~allocate ~~with~~resources, ~~the~~including ~~revised~~capital ~~presentation~~allocations.

Each geographic segment offers a vertically integrated suite of products and services, including aggregates, ready-mix concrete, asphalt and contracting services, while the Energy Services segment produces and supplies liquid asphalt, primarily for use in asphalt road construction, and is a supplier to some of the other segments. Each geographic segment mines, processes and sells construction aggregates (crushed stone and sand and gravel); produces and sells asphalt; and produces and sells ready-mix concrete as well as vertically integrating its contracting services to support the aggregate-based product lines. ~~Contracting~~including ~~services include~~ heavy-civil construction, asphalt and concrete paving, and site development and grading. Although not common to all locations, the geographic segments also sell cement, merchandise and other building materials and related services.

Corporate Services represents the unallocated costs of certain corporate functions, such as accounting, legal, treasury, business development, information technology, human resources and other corporate expenses that support the operating segments. Corporate Services also includes an immaterial amount of external revenue from the Knife River Training Center. We account for intersegment sales and transfers as if the sales or transfers were to third parties. The accounting policies applicable to each segment are consistent with those used in the audited consolidated financial statements.

22The proceeding information follows the same accounting policies as described in the audited financial statements and notes included in the Company's 2024 Annual Report. Prior periods presented have been recast to conform to the current reportable segment presentation.

Index

The information below follows the same accounting policies as described in the audited financial statements and notes included in the Company's 2023 Annual Report. Information on the Company's segments was as follows:


	Three Months Ended March 31, 2025										Three Months Ended March 31, 2024
	West		Mountain		Central		Energy Services		Total		West		Mountain		Central		Energy Services		Total
	(In thousands)
Revenues from external customers	$	208,018	$	65,994	$	67,841	$	11,545	$	353,398	$	197,539	$	59,825	$	60,964	$	11,116	$	329,444
Intersegment revenues	28,899		3,645		8,478		3,678		44,700		28,516		3,962		6,097		2,981		41,556
Total segment revenue	236,917		69,639		76,319		15,223		398,098		226,055		63,787		67,061		14,097		371,000

Other revenues1									3,669										5,142
Less: Elimination of intersegment revenue									48,296										46,552
Total consolidated revenue									$	353,471									$	329,590

Cost of revenue excluding depreciation, depletion and amortization	193,638		76,600		82,120		18,897				186,788		61,287		71,636		14,204
Selling, general and administrative expenses excluding depreciation, depletion and amortization	21,646		9,299		18,470		4,099				19,730		8,607		14,225		2,420
Other segment items2	3,281		(7)		(21)		(29)				(126)		43		78		44
Total segment EBITDA	$	24,914	$	(16,267)	$	(24,292)	$	(7,802)	$	(23,447)	$	19,411	$	(6,064)	$	(18,722)	$	(2,483)	$	(7,858)

Consolidated loss before income taxes									(93,349)										(63,955)
Plus:
Depreciation, depletion and amortization									38,762										32,212
Interest expense, net3									13,123										11,147
Less unallocated amounts:
Other corporate revenue									73										146
Other corporate expenses									(18,090)										(12,884)
Total segment EBITDA									$	(23,447)									$	(7,858)

Capital expenditures	$	26,921	$	13,929	$	25,893	$	1,617	$	68,360	$	18,581	$	8,498	$	6,582	$	2,394	$	36,055
Assets	$	1,265,438	$	350,259	$	1,138,931	$	285,681	$	3,040,309	$	1,202,549	$	309,451	$	603,182	$	160,892	$	2,276,074
Other assets									4,778,400										3,971,565
Elimination of intercompany receivables and investment in subsidiaries									4,538,002										3,733,996
Total consolidated assets									$	3,280,707									$	2,513,643

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2024		2023		2024		2023
	(In thousands)
External operating revenues:
Pacific	$	164,986	$	157,329	$	375,201	$	348,051
Northwest	217,825		208,919		537,202		503,573
Mountain	261,118		254,722		514,713		491,094
Central	354,815		354,925		630,379		643,579
Energy Services	106,486		115,421		183,846		196,740
Total reportable segment external operating revenues	$	1,105,230	$	1,091,316	$	2,241,341	$	2,183,037
Intersegment operating revenues:
Pacific	$	29,722	$	30,116	$	65,342	$	63,313
Northwest	42,614		36,683		91,017		84,937
Mountain	65,281		68,178		106,021		108,888
Central	110,905		123,099		172,079		191,860
Energy Services	25,308		28,972		41,735		44,900
Total reportable segment intersegment operating revenues	$	273,830	$	287,048	$	476,194	$	493,898
EBITDA:
Pacific	$	29,497	$	28,557	$	46,543	$	46,161
Northwest	55,914		48,467		126,831		101,335
Mountain	59,446		59,434		96,500		86,004
Central	79,830		74,779		97,295		86,279
Energy Services	33,708		45,714		50,593		64,519
Total reportable segment EBITDA	$	258,395	$	256,951	$	417,762	$	384,298

1 Other revenues is comprised of revenue included within our corporate services.

A2 Other ~~reconciliation~~segment ofitems ~~consolidated~~is ~~operating~~comprised ~~revenues~~of toother ~~reportable~~income ~~segment~~(expense) ~~operating~~items ~~revenues~~on isthe asincome ~~follows:~~statement.

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2024		2023		2024		2023
	(In thousands)
Consolidated operating revenues	$	1,105,293	$	1,090,372	$	2,241,789	$	2,183,462
Plus:
Intersegment operating revenues	276,899		293,456		488,532		500,704
Less:
Corporate Services revenue	3,132		5,464		12,786		7,231
Total reportable segment operating revenues	$	1,379,060	$	1,378,364	$	2,717,535	$	2,676,935

3 Interest expense, net is interest expense net of interest income.

2321

Index

ANote ~~reconciliation~~16 of- ~~consolidated~~Commitments ~~net~~and ~~income before income taxes to reportable segment EBITDA is as follows:~~contingencies

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2024		2023		2024		2023
	(In thousands)
Total consolidated net income before income taxes	$	197,688	$	194,874	$	237,848	$	218,498
Plus:
Depreciation, depletion and amortization	34,796		31,752		101,519		92,511
Interest expense, net*	12,113		14,774		36,069		41,399
Less:
Corporate Services EBITDA	(13,798)		(15,551)		(42,326)		(31,890)
Total EBITDA for reportable segments	$	258,395	$	256,951	$	417,762	$	384,298
*Interest, net is interest expense net of interest income.

We are party to claims and lawsuits arising out of our business and that of our consolidated subsidiaries, which may include, but are not limited to, matters involving property damage, personal injury, and environmental, contractual and statutory obligations. We accrue a liability for those contingencies when the incurrence of a loss is probable and the amount can be reasonably estimated. If a range of amounts can be reasonably estimated and no amount within the range is a better estimate than any other amount, then the minimum of the range is accrued. We do not accrue liabilities when the likelihood that the liability has been incurred is probable but the amount cannot be reasonably estimated or when the liability is believed to be only reasonably possible or remote. For contingencies where an unfavorable outcome is probable or reasonably possible and which are material, we disclose the nature of the contingency and, in some circumstances, an estimate of the possible loss. Accruals are based on the best information available, but in certain situations management is unable to estimate an amount or range of a reasonably possible loss including, but not limited to when: (1) the damages are unsubstantiated or indeterminate, (2) the proceedings are in the early stages, (3) numerous parties are involved, or (4) the matter involves novel or unsettled legal theories.

~~Note~~At 15March 31, -2025 ~~Commitments~~and 2024, and ~~contingencies~~December 31, 2024, we accrued contingent liabilities as a result of litigation, which have not been discounted, of $3.4 million, $1.2 million and $6.6 million, respectively. At March 31, 2025 and 2024, and December 31, 2024, we also recorded corresponding insurance receivables of $0, $400,000 and $459,000, respectively, related to the accrued liabilities. Most of these claims and lawsuits are covered by insurance, thus our exposure is typically limited to our deductible amount. Management will continue to monitor each matter and adjust accruals as might be warranted based on new information and further developments. Management believes that the outcomes with respect to probable and reasonably possible losses in excess of the amounts accrued, net of insurance recoveries, while uncertain, either cannot be estimated or will not have a material effect upon the Company's financial position, results of operations or cash flows. Unless otherwise required by GAAP, legal costs are expensed as they are incurred.

The Company is party to claims and lawsuits arising out of its business and that of its consolidated subsidiaries, which may include, but are not limited to, matters involving property damage, personal injury, and environmental, contractual and statutory obligations. We accrue a liability for those contingencies when the incurrence of a loss is probable and the amount can be reasonably estimated. If a range of amounts can be reasonably estimated and no amount within the range is a better estimate than any other amount, then the minimum of the range is accrued. We do not accrue liabilities when the likelihood that the liability has been incurred is probable but the amount cannot be reasonably estimated or when the liability is believed to be only reasonably possible or remote. For contingencies where an unfavorable outcome is probable or reasonably possible and which are material, we disclose the nature of the contingency and, in some circumstances, an estimate of the possible loss. Accruals are based on the best information available, but in certain situations management is unable to estimate an amount or range of a reasonably possible loss including, but not limited to when: (1) the damages are unsubstantiated or indeterminate, (2) the proceedings are in the early stages, (3) numerous parties are involved, or (4) the matter involves novel or unsettled legal theories.

At September 30, 2024 and 2023, and December 31, 2023, we accrued contingent liabilities as a result of litigation, which have not been discounted, of $3.2 million, $645,000 and $873,000, respectively. Most of these claims and lawsuits are covered by insurance, thus the Company's exposure is typically limited to its deductible amount. Management will continue to monitor each matter and adjust accruals as might be warranted based on new information and further developments. Management believes that the outcomes with respect to probable and reasonably possible losses in excess of the amounts accrued, net of insurance recoveries, while uncertain, either cannot be estimated or will not have a material effect upon the Company's financial position, results of operations or cash flows. Unless otherwise required by GAAP, legal costs are expensed as they are incurred.

Environmental matters

~~The~~Knife ~~Company~~River Corporation - Northwest is a party to claims for the cleanup of a superfund site in Portland, Oregon. There were no material changes to the environmental matters that were previously reported in the audited financial statements and notes included in ~~the~~our ~~Company's~~2024 ~~2023~~ Annual Report.

Guarantees

~~Knife~~We ~~River and certain of its subsidiaries~~ have outstanding obligations to third parties where ~~the~~we ~~Company~~have ~~has~~ guaranteed ~~their~~our performance. These guarantees are related to contracts for contracting services and certain other guarantees. At ~~September~~March 3031, ~~2024~~2025, the fixed maximum amounts guaranteed under these agreements aggregated to $11.5 million, all of which have no scheduled maturity date. Certain of the guarantees also have no fixed maximum amounts specified. There were no amounts outstanding under the previously mentioned guarantees at ~~September~~March 3031, ~~2024~~2025.

~~Knife~~We ~~River and certain of its subsidiaries~~ have outstanding letters of credit to third parties related to insurance policies and other agreements. At ~~September~~March 3031, ~~2024~~2025, the fixed maximum amounts guaranteed under these letters of credit aggregated $2023.63 million. At ~~September~~March 3031, ~~2024~~2025, the amounts of scheduled expiration of the maximum amounts guaranteed under these letters of credit aggregate to $011.8 million in ~~2024~~2025, $2011.52 million in ~~2025~~2026, $0104,000 in ~~2026~~2027 and $~~104~~175,000 in ~~2027~~2028. There were no amounts outstanding under the previously mentioned letters of credit at ~~September~~March 3031, ~~2024~~2025.

In the normal course of business, we have surety bonds related to contracts for contracting services, reclamation obligations and insurance policies of its subsidiaries. In the event a subsidiary of Knife River does not fulfill a bonded obligation, ~~the~~we ~~Company~~ would be responsible to the surety bond company for completion of the bonded contract or obligation. A large portion of the surety bonds are expected to expire within the next 12 months; however, we will likely continue to enter into surety bonds for our subsidiaries in the future. At ~~September~~March 3031, ~~2024~~2025, approximately $~~686~~744.87 million of surety bonds were outstanding, which were not reflected on the Consolidated Balance Sheet.

24Note 17 - Related-party transactions

Index

Note 16 - Related-party transactions

Transition services agreements

On May 31, 2023, the separation of Knife River from MDU Resources Group, Inc. (MDU Resources) and its other businesses was completed and Knife River became an independent, publicly traded company (Separation) listed on the New York Stock Exchange under the symbol "KNF". As part of the Separation, MDU Resources provided transition services to ~~Knife~~us ~~River~~ and ~~Knife~~we ~~River~~provided ~~is providing~~ transition services to MDU Resources in accordance with the Transition Services Agreement entered into on May 30, 2023. ~~The~~We ~~Company~~ paid $40816,000 ~~and $1.3 million~~ for the three months ended ~~and~~March ~~$1.3 million and $1.9 million for the nine months ended September 30~~31, 2024 ~~and 2023~~, ~~respectively,~~ related to these activities, which were reflected in selling, general and administrative expenses on the Consolidated Statements of Operations. ~~The~~We ~~Company~~ received $1476,000 ~~and $407,000~~ for the three months ended ~~and~~March ~~$152~~31,~~000~~ ~~and $684,000 for the nine months ended September 30,~~ 2024 ~~and 2023~~, ~~respectively,~~ related to these activities, which were reflected in other income on the Consolidated Statements of Operations. The majority of the transition services were completed over a period of one year after the Separation. ~~The~~and, ~~Company~~as ~~expects~~of ~~minimal~~December ~~continued~~31, ~~services~~2024, byno ~~Knife~~further ~~River~~obligation tofor ~~MDU~~services ~~Resources~~exists ~~through~~for ~~May~~either ~~2025~~party.

~~For additional information on the presentation of related-party transactions, see Note 2.~~22

Note 17 - Subsequent event

On November 2, 2024, the Company acquired the business of Albina Asphalt, a liquid asphalt provider with operations in Washington, Oregon and California, and will be included in the Company's Energy Services segment. To date, the initial accounting for the acquisition is incomplete. Due to the limited time since the date of the acquisition, it is impracticable for the Company to make business combination disclosures related to the acquisition. The Company is still gathering the necessary information to provide such disclosures in future filings.

Index

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended ("Exchange Act"). Forward-looking statements are all statements other than statements of historical fact, including without limitation those statements that are identified by the words "anticipates," "estimates," "expects," "intends," "plans," "predicts" and similar expressions, and include statements concerning plans, ~~trends~~projections, objectives, goals, strategies, future events or performance, and underlying assumptions (many of which are based, in turn, upon further assumptions) and other statements that are other than statements of historical facts. From time to time, Knife River Corporation ("Knife River," the "Company," "we," "our," or "us") may publish or otherwise make available forward-looking statements of this nature, including statements related to its Competitive EDGE strategy ("EDGE") implemented to improve margins and to execute on other strategic initiatives aimed at generating long-term profitable growth, shareholder value creation, expected long-term goals, backlog margin and acquisitions or financing plans.

Forward-looking statements involve risks and uncertainties, which could cause actual results or outcomes to differ materially from those expressed. ~~The~~Our ~~Company's~~ expectations, beliefs and projections are expressed in good faith and are believed ~~by the Company~~ to have a reasonable basis, including without limitation, management's examination of historical operating trends, data contained in ~~the~~our ~~Company's~~ records and other data available from third parties. Nonetheless, ~~the~~our ~~Company's~~ expectations, beliefs or projections may not be achieved or accomplished and changes in such assumptions and factors could cause actual future results to differ materially.

Any forward-looking statement contained in this document speaks only as of the date on which the statement is made, and ~~the~~we ~~Company~~undertake ~~undertakes~~ no obligation to update any forward-looking statement or statements to reflect events or circumstances that occur after the date on which the statement is made or to reflect the occurrence of unanticipated events, except as required by law. New factors emerge from time to time, and it is not possible for management to predict all the factors, nor can it assess the effect of each factor on ~~the~~our ~~Company's~~ business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statement. All forward-looking statements, whether written or oral and whether made by or on behalf of ~~the~~our Company, are expressly qualified by the risk factors and cautionary statements reported in the section entitled "Item 1A. Risk Factors" in Part I of the Company's ~~2023~~2024 Annual Report on Form 10-K ("Annual Report") and subsequent filings with the United States Securities and Exchange Commission ("SEC").

Company Overview

At Knife River, iswe are a people-first construction materials and contracting services company. We provide construction materials and contracting services to build safe roads, bridges, airport runways and other critical infrastructure needs that connect people with where they want to go and with the supplies they need. We also champion a positive workplace culture by focusing on safety, training, inclusion, compensation and work-life balance.

~~Knife~~We ~~River~~are is one of the leading providers of crushed stone and sand and gravel in the United States and ~~operates~~operate through ~~six~~four operating segments ~~across 14 states: Pacific~~, ~~Northwest,~~which ~~Mountain, North Central, South and Energy Services. These operating segments~~ are ~~used~~also toour ~~determine the Company's~~ reportable segments ~~and are based on our method of internal reporting and management of our business~~, asacross ~~discussed in Note~~ 14. ~~The Company's reportable segments are~~states: ~~Pacific~~West, ~~Northwest,~~ Mountain, Central, and Energy Services. The geographic segments primarily provide aggregates, asphalt and ready-mix concrete, as well as related contracting services such as heavy-civil construction, asphalt paving, concrete construction, site development and grading. The Energy Services segment produces and supplies liquid asphalt and related services, primarily for use in asphalt road construction.

As an aggregates-led construction materials and contracting services provider in the United States, our 1.12 billion tons of aggregate reserves, as of December 31, 2024, provide the foundation for a vertically integrated business strategy, with approximately 37 percent of our aggregates ~~in 2024~~ being used internally to support value-added downstream products (ready-mix concrete and asphalt) and contracting services (heavy-civil construction, laydown, asphalt paving, concrete construction, site development and grading services, bridges and in some segments the manufacturing of prestressed concrete products). Our aggregate sites and associated asphalt and ready-mix plants are primarily in strategic locations near mid-sized, high-growth markets, providing us with a transportation advantage for our materials that supports competitive pricing and increased margins. We provide our products and services to both public and private markets, with public markets being the majority of our work and tending to be more stable across economic cycles, which helps offset the cyclical nature of the private markets.

2623

Index

We provide various products and services and operate a variety of facility types, including aggregate quarries and mines, ready-mix concrete plants, asphalt plants and distribution facilities, in the following states:

•~~Pacific~~West: Alaska, California, Hawaii, Oregon, and ~~Hawaii~~Washington

•Northwest: Oregon and Washington

•Mountain: Idaho, Montana and Wyoming

•Central: Iowa, Minnesota, North Dakota, South Dakota and Texas

•Energy Services: California, Iowa, Nebraska, Oregon, South Dakota, Texas, Washington and Wyoming

The following table presents a summary of products and services provided, as well as modes of transporting those products:

Products and Services Modes of Transportation Precast/ Ready-Mix Construction Prestressed Liquid Heavy Aggregates Asphalt Concrete Services Concrete Asphalt Cement Equipment Trucking Rail Barge ~~Pacific~~West X X X X X X X X X X ~~Northwest X X X X X X X X X~~ Mountain X X X X X X Central X X X X X X X X Energy Services X X X

Basis of Presentation

OnIn ~~May~~January 312025, ~~2023,~~we ~~Knife~~made ~~River~~a ~~became~~change ato ~~stand-alone~~our ~~publicly~~organizational ~~traded~~structure ~~company~~to better align with our business strategy. ~~Prior~~We reorganized our business segments to reflect changes in the ~~Separation,~~way ~~Knife~~our ~~River~~chief ~~operated~~operating asdecision amaker ~~wholly~~evaluates ~~owned~~performance, ~~subsidiary~~makes ofoperating ~~Centennial~~decisions ~~Energy~~and ~~Holdings,~~allocates ~~Inc~~resources. ~~("Centennial")~~Our former Pacific and anNorthwest ~~indirect,~~operating ~~wholly~~segments ~~owned~~were ~~subsidiary~~combined ofto ~~MDU~~form ~~Resources~~the ~~Group,~~new ~~Inc~~West operating segment. ~~("MDU~~Our ~~Resources")~~former North Central and ~~not~~South asoperating asegments ~~stand-alone~~were ~~company.~~combined ~~The~~to ~~accompanying~~form ~~historical~~the ~~consolidated~~new ~~financial~~Central ~~statements~~operating ~~and~~segment. ~~footnotes~~The ~~for~~reorganization ~~the~~resulted ~~periods~~in ~~prior~~four tooperating ~~the~~segments: ~~Separation~~West, ~~were~~Mountain, ~~prepared~~Central onand aEnergy ~~“carve-out”~~Services, ~~basis~~each ~~using~~of ~~the~~which ~~legal~~is ~~entity~~also ~~approach~~a inreportable ~~conformity~~segment. ~~with~~Each ~~accounting~~segment’s ~~principles~~performance ~~generally~~is ~~accepted~~evaluated inbased ~~the~~on ~~United~~segment ~~States~~results ofwithout ~~America~~allocating ~~("GAAP")~~corporate ~~and~~expenses, ~~were~~which ~~derived~~include ~~from~~corporate ~~the~~costs ~~consolidated~~associated ~~financial~~with ~~statements~~accounting, oflegal, ~~MDU~~treasury, ~~Resources~~business asdevelopment, ifinformation ~~Knife~~technology, ~~River~~human ~~operated~~resources, onand aother ~~stand-alone~~corporate ~~basis~~expenses ~~during~~that ~~these~~support ~~periods~~the operating segments. ~~For~~Prior ~~additional~~periods ~~information~~have ~~related~~been recast to ~~the~~conform ~~basis~~to ofthe ~~presentation,~~current ~~see~~reportable ~~Note 2~~segment presentation.

All intercompany balances and transactions between the businesses comprising Knife River have been eliminated in the accompanying consolidated financial statements.

In the fourth quarter of 2023, we realigned our reportable segments to better support our operational strategies. The liquid asphalt and related services portion of the Pacific segment’s businesses are now reported under the Energy Services segment. In addition, the North Central and South operating regions have been aggregated into one reportable segment, Central. We also reallocated certain amounts to the operating segments that were previously reported within Corporate Services. All periods have been recast to conform with the revised presentation.

Market Conditions and Outlook

Our markets remain resilient and construction activity remains generally strong. Approximately 80 percent of our contracting services revenue each year comes from public-sector projects, enhancing stability through market cycles. For more information on factors that may negatively impact ~~Knife~~our ~~River's~~ business, see the section entitled "Item 1A. Risk Factors" in Part I of the Company's ~~2023~~2024 Annual Report.

Backlog. ~~Knife~~Our ~~River’s~~ contracting services backlog was as follows:

	September 30, 2024		September 30, 2023		December 31, 2023
	March 31, 2025		March 31, 2024		December 31, 2024
	(In millions)
Pacific	$	114.9	$	69.8	$	51.2
West	$	242.1	$	297.1	$	230.2
Northwest	168.0		227.4		196.2
Mountain	418.3		383.2		339.9
Mountain	279.9		251.1		256.7
Central	278.3		279.2		175.5
Central	192.3		183.9		158.1
	$	938.7	$	959.5	$	745.6
	$	755.1	$	732.2	$	662.2

27Expected margins on backlog at March 31, 2025, were comparable to the expected margins on backlog at March 31, 2024. Of the $938.7 million of backlog at March 31, 2025, we expect to complete approximately $820.6 million in the 12 months following March 31, 2025. Approximately 87 percent of our backlog at March 31, 2025, relates to publicly funded projects, including street and highway construction projects, which are driven primarily by public works projects for state departments of transportation (DOT). Further, there continues to be infrastructure development, as discussed in the following section on Public Funding, which is expected to continue to provide bidding opportunities in our markets. We anticipate that full-year 2025 contracting service margins will be similar to 2024.

Period-over-period increases or decreases in backlog may not be indicative of future revenues, margins, net income or earnings before interest, taxes, depreciation, depletion and amortization (EBITDA). See the section entitled “Item 1A. Risk Factors” in Part I of the Company's 2024 Annual Report for a list of factors that can cause revenues to be realized in periods and at levels that are different from originally projected.

Public Funding. Funding for public projects is dependent on federal and state funding, such as appropriations to the Federal Highway Administration. During the quarter, the American Society of Civil Engineers published its 2025 Report Card for America's

Index

~~Expected margins on backlog at September 30~~Infrastructure, ~~2024,~~assigning ~~were slightly higher than~~ the ~~expected~~United ~~margins~~States onroads ~~backlog~~a at"D+" ~~September 30,~~grade ~~2023.~~and Ofestimating ~~the~~that ~~$755.1~~between ~~million~~2024 ofand ~~backlog at September 30~~2033, ~~2024,~~the wecountry ~~expect~~will torequire ~~complete~~more ~~approximately~~funding ~~$688.9~~than ~~million~~what inis ~~the~~currently ~~12 months following September 30, 2024~~authorized. ~~While~~It ~~private~~is ~~work~~estimated ~~has~~that ~~softened~~a tototal ~~some~~of ~~extent,~~$2.2 wetrillion ~~continue~~in tofunding ~~see~~will ~~strong~~be ~~bidding~~needed ~~opportunities~~ for ~~public work across~~ our ~~states.~~roadway ~~Approximately~~systems ~~87 percent of our backlog at September 30, 2024, relates~~ to ~~publicly~~reach ~~funded~~a ~~projects, including street and highway construction projects, which are driven primarily by public works projects for~~ state ~~departments~~ of ~~transportation.~~good ~~Further, there continues to be infrastructure development, as discussed in the following section on Public Funding, which is expected to continue to provide bidding opportunities in our markets~~repair.

~~Period-over-period~~Currently, ~~increases~~states orhave ~~decreases~~continued inmoving ~~backlog~~forward ~~may~~with ~~not~~allocating befunds ~~indicative~~from offederal ~~future revenues~~programs, ~~margins,~~such ~~net~~as ~~income~~the orInfrastructure ~~earnings~~Investment ~~before~~and ~~interest,~~Jobs ~~taxes,~~Act ~~depreciation~~(IIJA), ~~depletion~~which ~~and~~is ~~amortization~~authorized ~~("EBITDA")~~to provide $1.2 ~~While~~trillion wein ~~believe~~funding ~~the~~from ~~current~~2022 ~~backlog~~through of2026. ~~work~~As ~~remains~~of ~~firm~~January 2025, ~~prolonged~~over ~~delays~~60 percent inof ~~the~~IIJA ~~receipt~~formula offunding ~~critical~~had ~~supplies~~yet ~~and~~to ~~materials,~~be ~~among~~spent ~~other~~in ~~things,~~our ~~could~~14 ~~result~~state inoperating ~~customers~~market. ~~seeking~~Additionally, toDOT ~~delay~~budgets orin ~~terminate~~most ~~existing~~of orthe ~~pending~~states ~~agreements~~where ~~and~~we ~~could~~operate ~~reduce~~remain ~~expected~~strong, ~~margins.~~which ~~See~~favorably affects bidding through the ~~section~~remainder ~~entitled~~of ~~“Item~~the 1Ayear. ~~Risk~~During ~~Factors”~~the inearly ~~Part~~part I of ~~the~~second ~~Company's~~quarter ~~2023~~2025, ~~Annual~~Washington, ~~Report~~Idaho ~~for~~and aNorth ~~list~~Dakota ofhave ~~factors~~all ~~that~~passed ~~can~~bills ~~cause~~that ~~revenues~~support totheir betransportation ~~realized~~funding. inWe ~~periods~~continue ~~and~~to atmonitor ~~levels~~the ~~that~~implementation ~~are~~and ~~different~~impact ~~from~~of ~~originally~~these ~~projected~~legislative items.

~~Public Funding~~Profitability. ~~Funding~~Our ~~for~~management ~~public~~team ~~projects~~continually ismonitors ~~dependent~~our onmargins ~~federal~~ and ~~state~~has ~~funding,~~been ~~such~~proactive asin ~~appropriations~~applying strategies to ~~the~~increase ~~Federal~~margins ~~Highway~~to ~~Administration~~support our long-term profitability goals and to create shareholder value. ~~States~~In ~~have~~2023, ~~moved~~we ~~forward~~began ~~with~~implementing ~~allocating~~EDGE ~~funds~~initiatives ~~from~~and ~~federal~~established ~~programs~~teams to deliver training, ~~such~~assist aswith ~~the~~targeting ~~Infrastructure~~higher-margin ~~Investment~~bidding opportunities across the regions and ~~Jobs~~pursue ~~Act~~growth ~~("IIJA")~~opportunities, ~~which~~as iswell ~~expected~~as toidentifying ~~provide~~ways ~~$1.2~~to ~~trillion~~increase inefficiencies ~~funding~~and ~~through~~reduce ~~2026~~costs. ~~Approximately~~Since ~~48 percent~~inception, ofthe ~~IIJA~~Materials ~~formula~~Process ~~funding~~Improvement ~~has~~Team ~~yet~~(Materials toPIT beCrew) ~~obligated~~has traveled to ~~projects~~22 inlocations throughout our ~~market~~operational ~~areas.~~footprint, Atvisiting ~~the~~135 ~~state~~individual ~~level~~aggregate, ~~eight~~asphalt ofand ~~the~~ready-mix 14concrete ~~states~~plants. inIn ~~which~~2024, we ~~operate~~created ~~have~~the ~~introduced~~position ~~legislation~~of toChief ~~fund~~Excellence ~~additional~~Officer. ~~construction~~This ~~projects~~newly asformed ofposition ~~September~~became effective January 1, ~~2024.~~2025, Weand ~~continue~~focuses toon ~~monitor~~expanding ~~the~~our ~~implementation~~PIT Crews and ~~impact~~leading ofour ~~these~~standardization ~~legislative items~~efforts. ~~Additionally,~~Under ~~Department~~the leadership of ~~Transportation~~the ~~("DOT")~~Chief ~~budgets~~Excellence inOfficer, ~~the~~a ~~states~~broader ~~where~~process weimprovement ~~operate~~framework ~~remain~~was ~~strong~~established, ~~despite~~creating ~~coming~~more ~~down~~teams ~~from~~focused ~~the~~on ~~prior~~standardization, ~~years'~~commercial ~~record~~excellence ~~level~~and operational excellence.

~~Profitability.~~Under ~~Our~~the ~~management~~current ~~team~~tariff ~~continually~~environment, ~~monitors~~we ~~our~~did ~~margins~~not ~~and~~experience ~~has~~a ~~been~~material ~~proactive~~direct inimpact ~~applying strategies~~ to ~~increase~~the ~~margins~~results toof ~~support~~ our ~~long-term~~financial ~~profitability~~operations ~~goals~~in ~~and~~the tofirst ~~create~~three ~~shareholder~~months ~~value~~of 2025. InWe ~~2023,~~continue ~~we began implementing EDGE initiatives and established teams~~ to ~~deliver~~closely ~~training,~~monitor ~~assist with targeting higher-margin bidding opportunities across~~ the ~~regions~~effects and ~~pursue~~changes ~~growth opportunities, as well as looking for ways~~ to ~~increase~~these ~~efficiencies and reduce costs. The process improvement team ("PIT crew") visited 10 of our largest locations in 2023~~announcements, ~~including~~but ~~quarries,~~currently ~~asphalt~~do ~~plants~~not ~~and~~have ~~ready-mix~~enough ~~plants.~~information ~~In 2024, the PIT crew has been expanded~~ to ~~extend~~fully ~~its~~quantify ~~influence~~the todirect ~~more~~or ~~locations~~indirect ~~and~~impact ~~standardize~~these ~~best~~tariffs ~~practices.~~will ~~The~~have ~~PIT~~once ~~crew~~fully ~~has visited 58 plants across 8 states through the third quarter of 2024~~enacted.

Growth. Our management team ~~has~~continues ~~also continued~~ to evaluate growth opportunities, both through organic growth and acquisitions they believe will generate shareholder value. AsOur ofbusiness ~~November~~development 4,team ~~2024,~~is wefocused ~~have~~on ~~invested~~our ~~$129.3~~growth ~~million~~with ofmaterials-led ~~capital~~businesses toin ~~close~~mid-size, onhigh ~~six~~growth ~~acquisitions~~markets, ~~with~~and ahas ~~focus~~several ontargets ~~aggregate~~at ~~reserves,~~various ~~ready-mix~~stages ~~and~~of ~~liquid~~completion ~~asphalt~~in ~~operations.~~our ~~The~~acquisition ~~acquisitions~~pipeline. ~~include~~In ~~aggregate-specific~~March ~~purchases in key markets~~2025, ~~including~~we completed the ~~assets~~acquisition of ~~Frank~~Strata B.Corporation, ~~Marks~~which &is ~~Son~~now included in ~~Northern~~our ~~California~~Central ~~and~~segment. ~~Rock~~As ~~Products~~part ~~Manufacturing~~of inthe ~~Central~~acquisition, ~~Oregon.~~we Weadded ~~also~~over ~~added~~30 toyears ~~our~~of ~~ready-mix~~aggregate ~~operations~~reserves infor ~~California~~Strata's ~~Central~~operations, ~~Valley~~which ~~and,~~is based on ~~November~~Strata's 2,historical ~~2024~~sales volumes, we24 ~~purchased~~ready-mix ~~the~~plants ~~business~~and ofthree ~~Albina~~asphalt ~~Asphalt.~~plants, ~~Albina~~which ~~has~~complements ~~operations~~our inexisting ~~Washington,~~operations. ~~Oregon~~In ~~and~~March ~~California~~2025, ~~and~~we ~~will~~also ~~expand~~completed the ~~footprint~~acquisition of ~~our~~an ~~high-margin~~aggregate ~~liquid~~quarry ~~asphalt~~operation ~~materials~~in ~~product~~Washington, ~~line~~which will supply aggregates to Southern Washington and Northern Oregon.

~~Knife~~In ~~River~~addition, ~~operates~~we inare ~~geographically~~investing ~~diverse~~in ~~and~~multiple ~~competitive~~organic ~~markets~~projects, ~~and strives to maximize efficiencies,~~ including ~~transportation~~an ~~costs~~aggregates ~~and~~expansion ~~economies~~project ofin ~~scale,~~South toDakota ~~further~~that ~~expand~~will ~~margins~~increase ~~and~~our ~~profitability.~~production ~~Our~~capabilities ~~margins~~in ~~can~~the ~~experience~~Sioux ~~negative~~Falls ~~pressure~~market. ~~from~~This ~~competition,~~project asis ~~well~~scheduled asto ~~impacts~~be ~~from~~operational ~~the variability~~ in ~~the~~2027. ~~cost~~We ofhave ~~raw~~also ~~materials,~~completed ~~such~~construction asof ~~diesel~~a ~~fuel,~~processing ~~gasoline,~~plant ~~natural~~to ~~gas,~~manufacture ~~liquid~~polymer modified asphalt, ~~cement~~(PMA) and ~~steel,~~add ~~with fuel and~~ liquid asphalt ~~costs~~storage ~~often~~in ~~having~~our ~~the~~South ~~most~~Dakota ~~significant~~operations, ~~impact~~which onwill ~~results.~~allow ~~Many~~us ~~of these raw materials are subject~~ to ~~factors~~more ~~that~~cost ~~are~~effectively ~~beyond~~supply ~~our~~this ~~control,~~local ~~including global economic and political events and new and changing governmental regulations~~market. ~~The~~In ~~Energy~~Twin ~~Services segment is particularly susceptible to variability in liquid asphalt costs~~Falls, ~~which can impact both cost of sales and revenues~~Idaho, ~~for which~~ we ~~cannot~~are ~~reliably~~greenfielding ~~predict~~new ~~future~~ready-mix ~~pricing.~~operations ~~Such~~which ~~variability~~will ~~and~~provide ~~inflationary~~us ~~pressures~~with ~~may~~a ~~have an impact on our margins, including~~ fixed~~-price~~ ~~contracting~~base ~~services~~to ~~contracts~~work ~~that~~from ~~are impacted by the variability of energy~~ and ~~material~~allow ~~prices.~~us ~~We mitigate our exposure~~ to ~~these~~build ~~fluctuations~~a bylocal ~~entering~~team ~~into various purchase commitments, as well as by generally including terms~~ in ~~our~~this ~~contracting~~high-growth ~~services agreements that provide for price adjustments related to variations in raw materials costs~~market.

~~Our operations can also be significantly impacted by both favorable and unfavorable weather conditions~~Seasonality. ~~Unseasonably~~We ~~dry~~typically orexperience ~~warm~~seasonal ~~weather~~losses in the ~~states~~first ~~where~~quarter wedue ~~operate~~to ~~can allow for~~ a ~~lengthened~~large ~~construction~~portion ~~season~~of orour ~~allow~~markets ~~for~~being angeographically ~~earlier~~located ~~start on specific projects, while unseasonably wet and/or cold weather~~ in the ~~states~~northern ~~where~~part weof ~~operate can delay~~ the ~~start~~country. orGenerally, ~~cause~~construction anactivity ~~early~~increases ~~end~~in to the ~~construction~~second ~~season~~quarter orand ~~cause~~continues ~~temporary~~throughout ~~delays~~the onyear, ~~specific~~contributing ~~projects.~~to ~~Either of these conditions can impact~~ both ~~our construction~~ materials ~~sales~~ and contracting services ~~revenues~~volumes. ~~Other~~For ~~variables~~this ~~that~~reason, ~~can~~we ~~impact~~see ~~margins~~more ~~include~~pre-production ~~the~~activity ~~timing~~and ofsite ~~project~~improvements ~~starts~~in orthe ~~completions,~~first ~~pre-construction~~quarter ~~season~~as ~~activities~~we ~~including~~prepare ~~equipment~~for ~~repair~~the ~~and~~upcoming ~~maintenance~~construction ~~costs or equipment mobilization~~season, ~~and~~which ~~declines~~provides ora ~~delays~~benefit into ~~new~~us ~~and~~for ~~existing~~the ~~projects~~remainder ~~due~~of to the ~~cyclical~~year ~~nature~~as ofvolumes ~~the~~and ~~construction~~sales ~~industry~~increase. ~~Accordingly,~~Some ~~operating~~of ~~results~~this inpre-production ~~any~~work ~~particular~~includes ~~period~~stripping ~~may~~and ~~not~~harvesting beat ~~indicative~~our ofaggregate ~~the~~sites ~~results~~as ~~that~~well ~~can~~as berepairing ~~expected~~and ~~for~~mobilizing ~~any other period~~equipment.

Workforce. As a people-first company, we continually take steps to address safety, recruitment and retention of our employees. Safety is a core value at Knife River,. The fundamental tenants of our safety culture are that all injuries are preventable and wethat our team is committed to work safely every day. We continue to advance our culture of safety ~~training~~through engagement and ~~safety~~empowering ~~culture~~our ~~through~~team ~~engagement,~~members ~~interaction~~to take action and ~~cross~~make meaningful changes that improve their well-~~company~~being ~~participation~~and the well-being of others.

28We continue to deploy resources to attract, develop and retain qualified and diverse talent. As the United States faces shortages in the availability of individuals to fill careers in our industry, we have taken significant steps to showcase construction as a career of choice. In April 2025, we created the position Chief People Officer which oversees our team member relations, recruitment and retention and training and career development.

We own and operate a state-of-the-art training facility, the Knife River Training Center, which is used corporatewide to enhance the skills of both our new and existing employees through classroom education and hands-on experience. One of the most popular courses at the Knife River Training Center is the commercial driver's license training, which is helping to address an industry-wide labor shortage. The Knife River Training Center also offers a variety of courses around leadership development for all Knife River employees.

Index

We ~~continue~~employ toprofessional ~~deploy~~instructors ~~resources~~as topart ~~attract,~~of ~~develop~~our ~~and~~Training ~~retain qualified~~ and ~~diverse~~Development ~~talent. As the United States faces shortages in the availability of individuals to fill construction careers~~team, wewhich ~~have~~is ~~taken~~based ~~significant~~out ~~steps to showcase construction as a career~~ of ~~choice. We own and operate a state-of-~~the~~-art~~ ~~training facility, the~~ Knife River Training Center,. ~~which~~This isteam ~~used~~has ~~corporate~~a long-~~wide~~standing totradition ~~enhance the skills~~ of ~~both~~offering ~~our~~quality ~~new~~training ~~and~~to ~~existing~~both ~~employees~~frontline ~~through classroom education~~ and ~~hands~~leadership-onlevel ~~experience~~employees. ~~One~~Training ~~of the most popular~~ courses atinclude: ~~the Knife River Training Center is the~~ commercial driver'’s license/new ~~training~~truck driver, ~~which~~experienced istruck ~~helping~~driver, tonew ~~address~~and anexperienced ~~industry-wide~~equipment ~~labor~~operator, ~~shortage.~~sales, ~~The training facility also offers a variety of courses around~~ leadership/facilitator development ~~for~~and ~~all~~construction ~~Knife~~industry ~~River employees~~engagement.

Consolidated Overview

	Three Months Ended						~~Nine Months Ended~~
	September 30,						September 30,
	March 31,
	2024		2023				2024		2023
	2025		2024		% Change
	(In millions)
Revenue	$	~~1,105~~353.35	$	~~1,090~~329.46	7	%	$	~~2,241.8~~	$	~~2,183.5~~
Cost of revenue	~~832~~363.31		~~821~~323.01		12	%	~~1,786.1~~		~~1,757.0~~
Gross profit	~~273~~(9.06)		~~269~~6.45		(248)	%	~~455.7~~		~~426.5~~
Selling, general and administrative expenses	6373.91		5960.2		21	%	~~183.6~~		~~167.3~~
Operating income	209.1		210.2				272.1		259.2
Operating loss	(82.7)		(53.7)		(54)	%
Interest expense	1315.93		1513.39		10	%	~~41.8~~		~~44.0~~
Other income	24.56		—3.7		24	%	~~7.5~~		~~3.3~~
Income before income taxes	197.7		194.9				237.8		218.5
Loss before income taxes	(93.4)		(63.9)		(46)	%
Income tax expense	49.6		48.2				59.4		56.3
Income tax benefit	(24.7)		(16.3)		(52)	%
Net income	$	148.1	$	146.7			$	178.4	$	162.2
Net loss	$	(68.7)	$	(47.6)	(44)	%
EBITDA*	$	~~244~~(41.65)	$	~~241~~(20.46)	(101)	%	$	~~375.4~~	$	~~352.4~~
Adjusted EBITDA*	$	~~245~~(38.20)	$	~~247~~(17.57)	(115)	%	$	~~381.8~~	$	~~360.0~~

*EBITDA and Adjusted EBITDA are non-GAAP financial measures. For more information and reconciliations to the nearest GAAP measures, see the section entitled "Non-GAAP Financial Measures."

Revenue includes revenue from the sale of construction materials and contracting services. Revenue for construction materials is recognized at a point in time when delivery of the products has taken place. Contracting services revenue is recognized over time using an input method based on the cost-to-cost measure of progress on a project.

Cost of revenue includes all material, labor and overhead costs incurred in the production process for ~~Knife~~our ~~River's~~ products and services. Cost of revenue also includes depreciation, depletion and amortization attributable to the assets used in the production process.

Gross profit includes revenue less cost of revenue, as defined above, and is the difference between revenue and the cost of making a product or providing a service, before deducting selling, general and administrative expenses, income taxes and interest expense.

Selling, general and administrative expenses include the costs for estimating, bidding and corporate development, as well as costs related to segment and corporate management and administrative functions. Selling expenses can vary depending on the volume of projects in process and the number of employees assigned to estimating and bidding activities. Other general and administrative expenses include outside services; information technology; depreciation and amortization; training, travel and entertainment; office supplies; allowance for expected credit losses; gains or losses on the sale of assets; and other miscellaneous expenses.

Other income includes net periodic benefit costs for ~~the~~our ~~Company’s~~ benefit plan expenses, other than service costs; interest income; realized and unrealized gains and losses on investments for ~~the~~our ~~Company’s~~ nonqualified benefit plans; earnings or losses on joint venture arrangements; gain on bargain purchase; and other miscellaneous income or expenses, including ~~income and~~ expenses related to the transition services agreement with MDU Resources Group, Inc.

Income tax (benefit) expense consists of corporate income taxes related to ~~the~~our net income ~~of the Company~~(loss). Income taxes are presented at the corporate services level and not at the individual segments. The effective tax rate can be affected by many factors, including changes in tax laws, regulations or rates, new interpretations of existing laws or regulations and changes to ~~the~~our ~~Company's~~ overall levels of income (loss) before income tax.

The discussion that follows focuses on the key financial measures ~~the~~we ~~Company~~use ~~uses~~ to evaluate the performance of ~~its~~our business, which include revenue, ~~gross~~EBITDA ~~profit,~~and ~~gross~~EBITDA margin,. EBITDA and EBITDA margin. ~~Gross~~are ~~margin~~non-GAAP isfinancial ~~calculated~~measures used to measure profitability by ~~dividing~~our ~~gross~~management ~~profit~~and chief operating decision maker. For more information and reconciliations to the nearest GAAP measures, see the section entitled "Non-GAAP Financial Measures."

2926

Index

byThe ~~revenue.~~following ~~Gross~~tables ~~margin~~summarize ~~reflects~~our ~~the~~operating ~~percentage of revenue earned in comparison to cost~~results. ~~EBITDA and EBITDA margin are non-GAAP financial measures. For more information and reconciliations to the nearest GAAP measures, see the section entitled "Non-GAAP Financial Measures."~~

The following tables summarize operating results for the Company.


	Three Months Ended
	March 31,
	2025			2024
	Dollars		Margin	Dollars		Margin
	(In millions)
Revenues by segment:
West	$	208.3		$	198.7
Mountain	66.0			59.8
Central	67.9			61.0
Energy Services	13.9			12.8
Total segment revenues	356.1			332.3
Corporate Services and Eliminations	(2.6)			(2.7)
Consolidated revenues	$	353.5		$	329.6

EBITDA (a):
West	$	24.9	12.0%	$	19.4	9.8%
Mountain	(16.3)		(24.6)%	(6.1)		(10.1)%
Central	(24.3)		(35.8)%	(18.7)		(30.7)%
Energy Services	(7.8)		(56.0)%	(2.5)		(19.4)%
Total segment EBITDA (a)	(23.5)		(6.6)%	(7.9)		(2.4)%
Corporate Services and Eliminations (b)	(18.0)		N.M.	(12.7)		N.M.
Consolidated EBITDA (a)	$	(41.5)	(11.7)%	$	(20.6)	(6.2)%

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2024			2023			2024			2023
	Dollars		Margin	Dollars		Margin	Dollars		Margin	Dollars		Margin
	(In millions)
Revenues by segment:
Pacific	$	165.0		$	157.3		$	375.2		$	348.1
Northwest	218.1			209.4			539.7			504.2
Mountain	261.1			255.1			514.9			491.5
Central	354.9			354.9			630.5			643.6
Energy Services	125.9			140.6			214.9			234.1
Total segment revenues	1,125.0			1,117.3			2,275.2			2,221.5
Corporate Services and Eliminations	(19.7)			(26.9)			(33.4)			(38.0)
Consolidated revenues	$	1,105.3		$	1,090.4		$	2,241.8		$	2,183.5
Gross profit by segment:
Pacific	$	34.3	20.8%	$	33.3	21.1%	$	60.2	16.0%	$	59.8	17.2%
Northwest	57.4		26.3%	50.2		24.0%	129.1		23.9%	107.9		21.4%
Mountain	61.1		23.4%	59.7		23.4%	101.1		19.6%	88.8		18.1%
Central	85.4		24.1%	80.4		22.6%	110.6		17.5%	101.1		15.7%
Energy Services	34.7		27.5%	46.7		33.3%	53.7		25.0%	68.2		29.1%
Total segment gross profit	272.9		24.3%	270.3		24.2%	454.7		20.0%	425.8		19.2%
Corporate Services and Eliminations	.1		(0.6)%	(.9)		3.2%	1.0		(3.0)%	.7		(1.6)%
Consolidated gross profit	$	273.0	24.7%	$	269.4	24.7%	$	455.7	20.3%	$	426.5	19.5%
Net income by segment:
Pacific	$	23.4	14.2%	$	23.1	14.7%	$	28.5	7.6%	$	30.2	8.7%
Northwest	45.2		20.7%	38.7		18.5%	95.1		17.6%	72.9		14.5%
Mountain	52.7		20.2%	53.1		20.8%	76.8		14.9%	67.4		13.7%
Central	70.1		19.8%	66.1		18.6%	69.7		11.1%	61.1		9.5%
Energy Services	32.4		25.8%	44.5		31.6%	46.8		21.8%	60.8		26.0%
Total segment net income	223.8		19.9%	225.5		20.2%	316.9		13.9%	292.4		13.2%
Corporate Services and Eliminations (a)	(75.7)		N.M.	(78.8)		N.M.	(138.5)		N.M.	(130.2)		N.M.
Consolidated net income	$	148.1	13.4%	$	146.7	13.4%	$	178.4	8.0%	$	162.2	7.4%
EBITDA (b):
Pacific	$	29.5	17.9%	$	28.6	18.2%	$	46.5	12.4%	$	46.1	13.3%
Northwest	55.9		25.6%	48.5		23.2%	126.8		23.5%	101.3		20.1%
Mountain	59.4		22.8%	59.4		23.3%	96.5		18.7%	86.0		17.5%
Central	79.8		22.5%	74.8		21.1%	97.3		15.4%	86.3		13.4%
Energy Services	33.7		26.8%	45.7		32.5%	50.6		23.5%	64.5		27.6%
Total segment EBITDA (b)	258.3		23.0%	257.0		23.0%	417.7		18.4%	384.2		17.3%
Corporate Services and Eliminations	(13.7)		N.M.	(15.6)		N.M.	(42.3)		N.M.	(31.8)		N.M.
Consolidated EBITDA (b)	$	244.6	22.1%	$	241.4	22.1%	$	375.4	16.7%	$	352.4	16.1%

(a)EBITDA, total segment EBITDA, EBITDA margin and total segment EBITDA margin are non-GAAP financial measures. For more information and a reconciliation to the nearest GAAP measure, see the section entitled "Non-GAAP Financial Measures."

(ab)N.M. - not meaningful

(b)EBITDA, segment EBITDA, EBITDA margin and segment EBITDA margin are non-GAAP financial measures. For more information and a reconciliation to the nearest GAAP measure, see the section entitled "Non-GAAP Financial Measures."


	Three Months Ended
	March 31,
	2025		2024
Sales (thousands):
Aggregates (tons)	3,867		4,255
Ready-mix concrete (cubic yards)	544		530
Asphalt (tons)	199		221

Average selling price:*
Aggregates (per ton)	$	21.05	$	19.80
Ready-mix concrete (per cubic yard)	$	199.26	$	188.41
Asphalt (per ton)	$	81.05	$	74.50

Index

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2024		2023		2024		2023
Sales (thousands):
Aggregates (tons)	11,169		12,022		24,833		26,071
Ready-mix concrete (cubic yards)	1,148		1,271		2,653		2,944
Asphalt (tons)	3,150		3,349		5,183		5,441
Average selling price:*
Aggregates (per ton)	$	17.32	$	16.10	$	17.56	$	16.24
Ready-mix concrete (per cubic yard)	$	185.97	$	169.98	$	185.78	$	169.02
Asphalt (per ton)	$	68.28	$	66.51	$	67.68	$	66.41

*The average selling price includes freight and delivery and other revenues.

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2024			2023			2024			2023
	Dollars		Margin	Dollars		Margin	Dollars		Margin	Dollars		Margin
	(In millions)
Revenues by product line:
Aggregates	$	193.4		$	193.6		$	436.2		$	423.5
Ready-mix concrete	213.5			216.0			492.8			497.7
Asphalt	215.1			222.8			350.8			361.3
Liquid Asphalt	110.9			122.6			187.3			203.8
Other*	89.7			91.5			206.4			192.1
Contracting services	559.6			537.3			1,056.8			1,005.8
Internal sales	(276.9)			(293.4)			(488.5)			(500.7)
Total revenues	$	1,105.3		$	1,090.4		$	2,241.8		$	2,183.5
Gross profit by product line:
Aggregates	$	51.7	26.7%	$	51.8	26.7%	$	96.1	22.0%	$	90.6	21.4%
Ready-mix concrete	39.6		18.6%	37.7		17.4%	78.1		15.8%	74.5		15.0%
Asphalt	43.1		20.0%	39.4		17.7%	54.7		15.6%	49.7		13.8%
Liquid Asphalt	28.8		26.0%	39.2		32.0%	43.7		23.3%	57.4		28.1%
Other*	37.5		41.8%	38.7		42.3%	47.1		22.8%	48.9		25.5%
Contracting services	72.3		12.9%	62.6		11.7%	136.0		12.9%	105.4		10.5%
Total gross profit	$	273.0	24.7%	$	269.4	24.7%	$	455.7	20.3%	$	426.5	19.5%

Index


	Three Months Ended
	March 31,
	2025			2024
	Dollars		Margin	Dollars		Margin
	(In millions)
Revenues by product line:
Aggregates	$	81.4		$	84.3
Ready-mix concrete	108.5			99.8
Asphalt	16.1			16.5
Liquid asphalt	12.2			11.0
Other*	43.5			39.0
Contracting services	140.1			125.5
Internal sales	(48.3)			(46.5)
Total revenues	$	353.5		$	329.6

Gross profit by product line:
Aggregates	$	(6.0)	(7.4)%	$	4.8	5.7%
Ready-mix concrete	8.7		8.1%	8.6		8.6%
Asphalt	(5.7)		(35.4)%	(5.6)		(33.8)%
Liquid asphalt	(4.2)		(34.3)%	(.9)		(8.6)%
Other*	(13.2)		(30.3)%	(12.6)		(32.4)%
Contracting services	10.8		7.7%	12.2		9.7%
Total gross profit	$	(9.6)	(2.7)%	$	6.5	2.0%

*Other includes cement, merchandise, fabric and spreading, and other products and services that individually are not considered to be a core line of business.

Three Months Ended ~~September~~March 3031, ~~2024~~2025, Compared to Three Months Ended ~~September~~March 3031, ~~2023~~2024

Revenue

Revenue increased $1423.9 million, largely driven by additional contracting services activity resulting from more public agency-related construction work across our footprint. During the quarter, prices increased mid-single digits as a result of our pricing initiatives across ~~all~~our ~~product lines~~asphalt, ~~with~~aggregate ~~the exception of liquid asphalt. Aggregate~~ and ready-mix ~~concrete~~product ~~prices increased in the high single digits while asphalt increased low single digits~~lines. ~~Liquid~~Increased ~~asphalt~~sales ~~prices were lower as a result of reduced supply input costs across our market areas. Offsetting the price increases was a decline in ready-mix concrete and aggregate~~ volumes ~~across~~for all ~~segments,~~product ~~while~~lines ~~asphalt volumes decreased~~ in ~~only~~ the Central ~~and~~segment ~~Pacific~~were ~~segments.~~more ~~These~~than ~~lower~~offset ~~volumes~~by ~~are~~decreased ~~largely~~aggregates ~~the~~and ~~result~~asphalt ofsales ~~EDGE-related~~volumes ~~initiatives~~in ~~of quality over quantity of work,~~ the ~~timing~~West ~~of projects~~ and ~~lower~~Mountain ~~demand for private projects~~segments.

Gross profit and gross margin

Gross profit ~~improved~~decreased $316.61 million ~~and~~for ~~gross~~the ~~margin remained unchanged~~quarter. We ~~recognized~~saw ~~120~~an ~~basis~~increase ~~points~~in ~~higher~~costs ~~contracting~~in ~~services~~the ~~margins~~aggregates product line due to the timing of pre-production costs in the quarter, ~~from~~identified ~~increased~~PIT ~~activity~~Crew improvements and ~~improved~~lower ~~bid~~production ~~margins~~volumes. asIn aaddition, ~~result~~Energy ofServices ~~disciplined~~saw ~~project~~a ~~bidding~~decrease ~~and~~in ~~favorable~~gross ~~project~~profit ~~execution.~~mostly ~~Also~~due ~~contributing~~ to the ~~improvement~~addition ~~was~~of anseasonal ~~increase~~costs into ~~gross~~prepare ~~margin~~for on the ~~ready-mix~~upcoming ~~concrete~~paving season at Albina and ~~asphalt~~higher ~~product~~repairs ~~lines~~and maintenance costs. AsThe ~~part~~Mountain ofsegment ~~our~~had ~~EDGE-related~~lower ~~initiatives,~~gross ~~price~~profit ~~increases~~on ~~outpaced~~contracting ~~higher~~services ~~costs~~due ~~while~~to ~~volumes~~more ~~declined~~subcontract aswork ~~the~~performed ~~segments~~in ~~continue~~the toquarter ~~choose~~and ~~quality~~the timing of ~~work~~when ~~over~~project ~~quantity~~incentives ofwere ~~work.~~earned, ~~Liquid~~which ~~asphalt~~was ~~continued~~offset toin ~~see~~part aby ~~reduction~~higher gross profit in the West segment from favorable construction project execution in California. The West segment also had higher gross profit ~~from~~on ~~reduced~~cement due to strong market ~~pricing~~demand.

Index

Selling, general and administrative expenses

Selling, general and administrative expenses increased $412.79 million ~~year-over-year~~for the first quarter. Our reportable segments had higher costs of $49.5 1 million, ~~which was~~ primarily ~~increased payroll-related costs of $3.4 million, largely~~ due to additional ~~staffing~~overhead ~~and competitive wage increases, and higher professional services. Corporate Services had increased costs~~ of $23.25 million ~~for~~from ~~due~~the ~~diligence~~acquisition ~~and~~of ~~integration~~Strata ~~costs~~in ~~related~~March ~~to corporate development, higher health care costs~~ of ~~$1.9 million~~2025 and ~~additional~~Albina ~~information technology costs of $1.1 million. Offsetting these costs at Corporate Services was a reduction~~ in ~~insurance~~November ~~loss reserves at our captive insurer~~2024, as well as ~~lower~~increased ~~one~~labor-~~time~~related ~~Separation~~ costs ofpartly ~~$3.6~~due ~~million, primarily related~~ to ~~insurance~~additional ~~costs and the transition services agreement with MDU Resources~~employees.

Corporate Services had higher selling, general and administrative costs of $3.8 million in the quarter, driven largely by higher due diligence and integration costs of $5.8 million related to corporate development and completed acquisitions, as well as higher labor-related costs for additional staff and stock-based compensation expense. Offsetting these increased costs was the absence of one-time Separation costs in 2024 of $1.7 million and lower health care costs due the absence of a higher dollar claim in 2024.

Interest expense

Interest expense ~~decreased~~increased $1.4 million due primarily to ~~lower~~higher average debt balances with the issuance of a new Term Loan B in March of 2025.

~~Other income~~28

Other income improved $2.5 million, largely driven by increased interest income on higher average cash balances and higher returns on nonqualified benefit plan investments.

Income tax expense

Income tax expense increased $1.4 million, corresponding with higher income before income taxes.

Nine Months Ended September 30, 2024, Compared to Nine Months Ended September 30, 2023

Revenue

Revenue increased $58.3 million, largely driven by additional contracting services activity resulting from more public agency-related construction work. During the year, prices increased as a result of our pricing initiatives across all product lines, except liquid asphalt. Aggregate and ready-mix concrete prices increased in the high single digits while asphalt increased low single digits. Liquid asphalt prices were lower as a result of reduced supply input costs across our market areas. Offsetting the price increases was a decline in ready-mix concrete and aggregate volumes across most segments, while asphalt volumes decreased only in the Central segment. These lower volumes are largely the result of EDGE-related initiatives of quality over quantity of work, the timing of projects and lower demand for private projects.

Gross profit and gross margin

Gross profit improved $29.2 million and gross margin improved 80 basis points. Contracting services margins improved 240 basis points as all segments saw an increase in revenue along with improved bid margins and favorable project execution during the year. Also contributing to the improvement was higher gross margin on all product lines except liquid asphalt. As part of our EDGE-related initiatives, price increases outpaced higher costs while volumes declined as the segments continue to choose quality of work over quantity of work. Liquid asphalt continued to see a reduction in gross profit from reduced market pricing.

Selling, general and administrative expenses

Selling, general and administrative expenses increased $16.3 million. Our reportable segments had higher costs of $4.8 million, which was primarily higher payroll-related costs, largely due to additional staffing and competitive wage increases, and higher professional services of $3.0 million, partially offset by higher gains on asset sales of $2.5 million.

Corporate Services had increased costs of $11.4 million. The increase in costs for non-Separation related expenses include higher health care costs of $4.6 million, partly due to 2023 claims being paid from the MDU Resources health and welfare trust, due diligence and integration costs related to corporate development of $2.6 million and higher information technology costs of $1.0 million, partially offset by a reduction in insurance loss reserves at our captive insurer of $2.6 million. As a result of the Separation, Corporate Services experienced higher recurring costs as a publicly traded company of $6.6 million, including payroll-related costs of $9.5 million, largely due to additional staff and stock-based compensation expenses for the management team and board of directors; information technology costs of $2.8 million; professional services of $2.0 million; fees of $870,000 primarily related to fees on new debt issued in conjunction with the Separation; and insurance costs of $600,000. These recurring costs were partially offset by a reduction in general corporate expenses from MDU Resources of $9.0 million, as discussed in Note 2. Also, as part of the Separation, we incurred less one-time costs of $2.8 million, primarily related to insurance costs and the transition services agreement with MDU Resources.

Interest expense

Interest expense decreased $2.2 million due primarily to lower average debt balances, offset by higher average interest rates.

Other income

Other income increased $4.2 million due to increased interest income on higher average cash balances and higher returns on nonqualified benefit plan investments.

Income tax expense

Income tax expense increased $3.1 million, corresponding with higher income before income taxes.

Index

Other income

Other income improved $900,000, largely driven by a one-time gain of $3.5 million on the bargain purchase of an aggregates quarry operation in the West segment, offset in part by lower returns of $1.9 million on our nonqualified defined benefit plans and a decrease in interest income of $600,000.

Income tax benefit

Income tax benefit increased $8.4 million, corresponding with higher net loss before income taxes.

Business Segment Financial and Operating Data

A discussion of key financial data from ~~Knife~~our ~~River’s~~ business segments follows. ~~Knife~~We ~~River~~provide ~~provides~~ segment-level information by revenue, ~~gross profit, gross margin,~~ EBITDA and EBITDA margin, as these are the measures of profitability used by our chief operating decision maker to assess operational results. ~~EBITDA and EBITDA margin are non-GAAP financial measures. For more information and reconciliations to the nearest GAAP measure, see the section entitled "Non-GAAP Financial Measures.”~~

In ~~the~~January ~~fourth~~2025, ~~quarter~~we ofmade ~~2023,~~a wechange ~~realigned~~to our ~~reportable~~organizational ~~segments~~structure to better ~~support~~align with our ~~operational~~business ~~strategies~~strategy. ~~Based~~We onreorganized ~~how~~our ~~the~~business ~~chief~~segments ~~operating~~to ~~decision~~reflect ~~maker~~changes ~~manages~~in the ~~Company,~~way ~~the~~our ~~reportable~~chief ~~segments~~operating ~~are:~~decision ~~Pacific,~~maker ~~Northwest,~~evaluates ~~Mountain~~performance, ~~Central~~makes operating decisions and ~~Energy~~allocates ~~Services~~resources. ~~The~~Our ~~liquid~~former ~~asphalt~~Pacific and ~~related~~Northwest ~~services~~operating ~~portion~~segments ofwere combined to form the ~~Pacific~~new West operating segment’s. ~~businesses~~Our ~~are~~former ~~now~~North ~~reported~~Central ~~under~~and South operating segments were combined to form the ~~Energy~~new ~~Services~~Central operating segment. InThe ~~addition,~~reorganization ~~the~~resulted ~~North~~in four operating segments: West, Mountain, Central and ~~South~~Energy ~~operating~~Services, ~~regions~~each ~~have~~of ~~been~~which ~~aggregated~~is ~~into~~also ~~one~~a reportable segment~~, Central~~. WeEach ~~also~~segment’s ~~provide~~performance ~~the~~is ~~details~~evaluated ofbased ~~Corporate~~on ~~Services~~segment results without allocating corporate expenses, which ~~includes~~include corporate costs associated with accounting, legal, treasury, information technology, human resources, and ~~certain~~other corporate expenses that support ~~our operating segments. As a result of~~ the ~~segment changes, we reallocated certain amounts to the~~ operating segments ~~that were previously reported within Corporate Services~~. ~~All~~Prior periods presented have been recast to conform ~~with~~to the ~~revised~~current reportable segment presentation.

Results of Operations - ~~Pacific~~West

	Three Months Ended							~~Nine Months Ended~~
	September 30,							September 30,
	March 31,
	2024			2023			% Change	2024			2023			% Change
	2025			2024			% Change
	(In millions)
Revenue	$	~~165~~208.03		$	~~157~~198.37		5%	$	~~375.2~~		$	~~348.1~~		8%
Gross profit	$	34.3		$	33.3		3%	$	60.2		$	59.8		1%
EBITDA	$	24.9		$	19.4		28%
Gross margin	20.8		%	21.1		%		16.0		%	17.2		%
EBITDA margin	12.0		%	9.8		%
EBITDA	$	29.5		$	28.6		3%	$	46.5		$	46.1		1%
EBITDA margin	17.9		%	18.2		%		12.4%			13.3		%

	Three Months Ended				~~Nine Months Ended~~
	September 30,				September 30,
	March 31,
	2024		2023		2024		2023
	2025		2024
	(In millions)
Revenues:
Aggregates	$	3656.63	$	3358.69	$	~~87.5~~	$	~~79.7~~
Ready-mix concrete	4069.48		3963.90		~~108.3~~		~~106.5~~
Asphalt	118.98		1410.06		~~22.8~~		~~21.7~~
Other*	4834.04		4928.59		~~115.7~~		~~112.8~~
Contracting services	5767.86		5064.46		~~106.2~~		~~90.7~~
Internal sales	(2928.76)		(3027.13)		~~(65.3)~~		~~(63.3)~~
	$	~~165~~208.03	$	~~157~~198.37	$	~~375.2~~	$	~~348.1~~

*Other includes cement, merchandise, transportation services and other products that individually are not considered to be a core line of business for the segment.

Three Months Ended ~~September~~March 3031, ~~2024~~2025, Compared to Three Months Ended ~~September~~March 3031, ~~2023~~2024

Revenue increased $9.6 million, largely the result of higher pricing across all product lines contributing $14.1 million in the quarter. We also experienced an increase in market demand in Hawaii, which contributed to an increase of $4.0 million in cement and ready-mix volumes and California saw strong third-party demand for ready-mix concrete driving volumes up by $3.3 million. Partially offsetting the increase were $11.3 million lower aggregate and $3.7 million lower ready-mix concrete sales volumes in Oregon due largely to overall lower market demand. Contracting services contributed nearly $3.0 million to the increase, mostly due to more available public-agency and commercial work in California, which was offset in part by less public-agency work and timing of projects in certain Oregon markets.

Revenue increased $7.7 million as price increases across its product lines contributed an additional $12.0 million, which was mainly due to pricing initiatives and aggregate product mix. The revenue increase was also driven by an increase in construction activity in Northern California of $11.5 million, which was largely related to additional public agency-related construction activity. Offsetting the price increases were reduced volumes of $12.9 million across all material product lines, partly due to increased competition and reduced demand in private markets. 29

Gross profit and gross margin

Gross profit improved $1.0 million, largely due to increased gross profit across most product lines as a result of price increases outpacing costs, providing an additional $1.2 million. Also contributing to additional gross profit was more public agency-related construction work in Northern California. These increases were offset by lower asphalt volumes due to the nature of the contracting work in the quarter being more heavy-civil construction than paving, as well as higher costs, which contributed to a decline in gross margin of 30 basis points.

Index

EBITDA improved $5.5 million and EBITDA margin improved 220 basis points in the quarter. The increase in EBITDA was due in part to additional gross profit of $6.0 million on cement, aggregates and ready-mix concrete in Hawaii driven by increased market demand and higher prices outpacing cost increases. Contracting services saw favorable construction project execution in California and southern Oregon. The segment also recognized a one-time gain of $3.5 million due to an acquisition in the quarter that was a bargain purchase, as discussed in Note 10. Partially offsetting the increase was reduced gross profit on aggregates and ready-mix concrete in Oregon due largely to overall lower market demand, as well as higher pre-production costs on aggregates.

EBITDA improved $900,000 year-over-year, largely due to improved gross profit, as previously discussed. Slightly offsetting the increase was higher selling, general and administrative costs, largely payroll-related costs and professional services. EBITDA margin resulted in a decrease of 30 basis points, largely the result of the previously discussed lower gross margin.

Nine Months Ended September 30, 2024, Compared to Nine Months Ended September 30, 2023

Revenue

Revenue increased $27.1 million across all core product lines. This increase resulted from increased pricing of $26.6 million primarily from pricing initiatives and additional construction activity in Northern California of $20.8 million, which was largely related to public agency-related construction work. Partially offsetting the increased revenues were lower aggregate and ready-mix concrete volumes of $11.9 million across the segment's markets related to the timing of projects and reduced private-market demand.

Gross profit and gross margin

Gross profit improved $400,000, primarily the result of additional gross profit from contracting services of $3.2 million, largely from more public agency-related construction work in Northern California and improved project execution. Partially offsetting the increase in gross profit were lower aggregate and ready-mix concrete volumes, as previously discussed. The increase in gross profit was also offset by higher repair and maintenance costs within the aggregate, asphalt and ready-mix concrete product lines, which partially contributed to a decline in gross margin of 120 basis points.

EBITDA and EBITDA margin

EBITDA improved $400,000, largely due to improved gross profit, as previously discussed. EBITDA margin decreased 90 basis points, largely as the result of the previously discussed lower gross margin.

Results of Operations - Northwest

	Three Months Ended							Nine Months Ended
	September 30,							September 30,
	2024			2023			% Change	2024			2023			% Change
	(In millions)
Revenue	$	218.1		$	209.4		4%	$	539.7		$	504.2		7%
Gross profit	$	57.4		$	50.2		14%	$	129.1		$	107.9		20%
Gross margin	26.3		%	24.0		%		23.9		%	21.4		%
EBITDA	$	55.9		$	48.5		15%	$	126.8		$	101.3		25%
EBITDA margin	25.6		%	23.2		%		23.5		%	20.1		%

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2024		2023		2024		2023
	(In millions)
Revenues:
Aggregates	$	54.0	$	57.4	$	146.5	$	147.9
Ready-mix concrete	47.0		46.7		124.4		125.3
Asphalt	47.2		43.5		87.9		84.9
Other*	5.4		4.5		14.6		11.5
Contracting services	106.8		93.5		254.8		218.9
Internal sales	(42.3)		(36.2)		(88.5)		(84.3)
	$	218.1	$	209.4	$	539.7	$	504.2

*Other includes merchandise, transportation services and other products that individually are not considered to be a core line of business for the segment.

Three Months Ended September 30, 2024, Compared to Three Months Ended September 30, 2023

Revenue

Revenue increased $8.7 million, largely the result of higher contracting services revenue due to public agency-related construction work in the region, which also contributed to higher asphalt volumes. In addition, improved pricing on ready-mix concrete and aggregates provided $9.7 million more in revenues. Partially offsetting the increases were lower aggregate and ready-mix concrete sales volumes of $12.9 million resulting from EDGE-related price initiatives and market conditions.

Index

Gross profit and gross margin

Gross profit improved $7.2 million and gross margin improved 230 basis points mainly due to improved contracting services margins largely the result of favorable project execution as well as efficiencies gained at our Spokane prestress facility. An increase in asphalt volumes contributed higher gross profit of $1.3 million, largely due to additional contracting services work previously mentioned. Lower aggregate and ready-mix concrete volumes, as previously discussed, and higher depreciation expense across most product lines partially offset the increase in gross profit.

EBITDA and EBITDA margin

EBITDA improved $7.4 million and EBITDA margin improved 240 basis points, largely due to improved gross profit, as previously discussed, which was partially offset by higher selling, general and administrative costs due to increased payroll-related costs of $1.2 million.

Nine Months Ended September 30, 2024, Compared to Nine Months Ended September 30, 2023

Revenue

Revenue increased $35.5 million, largely the result of higher contracting services revenue due to increased public agency-related construction work in the region, which also contributed to higher asphalt volumes. Also contributing to the increase was improved pricing on ready-mix concrete and aggregates of $22.4 million, which was more than offset by lower ready-mix concrete and aggregates volumes of $24.7 million resulting from EDGE-related price initiatives and market conditions.

Gross profit and gross margin

Gross profit improved $21.2 million and gross margin improved 250 basis points largely due to improved contracting services margins resulting from favorable project execution as well as efficiencies gained at our Spokane prestress facility. Also positively contributing was improved gross margin across the aggregate and ready-mix product lines as a result of increased pricing outpacing costs and increased asphalt volumes. Partially offsetting these increases were the effects of lower ready-mix concrete and aggregates volumes, as previously discussed, and higher depreciation expense across all product lines.

EBITDA and EBITDA margin

Results of Operations - Mountain

	Three Months Ended							~~Nine Months Ended~~
	September 30,							September 30,
	March 31,
	2024			2023			% Change	2024			2023			% Change
	2025			2024			% Change
	(In millions)
Revenue	$	~~261~~66.10		$	~~255~~59.18		210%	$	~~514.9~~		$	~~491.5~~		5%
Gross profit	$	61.1		$	59.7		2%	$	101.1		$	88.8		14%
EBITDA	$	(16.3)		$	(6.1)		(168)%
Gross margin	23.4		%	23.4		%		19.6		%	18.1		%
EBITDA margin	(24.6)		%	(10.1)		%
EBITDA	$	59.4		$	59.4		—%	$	96.5		$	86.0		12%
EBITDA margin	22.8		%	23.3		%		18.7		%	17.5		%

	Three Months Ended				~~Nine Months Ended~~
	September 30,				September 30,
	March 31,
	2024		2023		2024		2023
	2025		2024
	(In millions)
Revenues:
Aggregates	$	408.10	$	399.5	$	~~80.7~~	$	~~78.1~~
Ready-mix concrete	4013.61		4413.18		~~89.4~~		~~93.0~~
Asphalt	60.05		59.78		~~93.8~~		~~89.9~~
Contracting services	~~185~~48.70		~~179~~39.67		~~356.9~~		~~339.0~~
Internal sales	(~~65.~~3.6)		(674.80)		~~(105.9)~~		~~(108.5)~~
	$	~~261~~66.10	$	~~255~~59.18	$	~~514.9~~	$	~~491.5~~

35Three Months Ended March 31, 2025, Compared to Three Months Ended March 31, 2024

Revenue increased $6.2 million in the quarter, largely driven by increased contracting services activity of $8.3 million due to timing of public-agency work in Idaho and improved pricing of $1.4 million on ready-mix concrete and aggregates. Partially offsetting the increase was lower aggregate volumes across Montana and Wyoming because of additional precipitation and lower ready-mix concrete volumes in Montana as a result of timing of customer projects and decreased residential demand.

EBITDA decreased $10.2 million for the quarter. The segment saw nearly $7.6 million in additional aggregate costs, mostly related to the timing of pre-production activities, such as stripping and harvesting, plant mobilization, and repair and maintenance; identified PIT Crew improvements; and lower production volumes due partly to additional precipitation in Montana and Wyoming. Contracting services also saw a $1.5 million decrease in margin due to more subcontract work performed in the quarter and the timing of when project incentives were earned.

Index

Three Months Ended September 30, 2024, Compared to Three Months Ended September 30, 2023

Revenue

Revenue increased $6.0 million due to higher pricing on aggregates and ready-mix concrete, which contributed $9.4 million to the overall increase in revenue. Also contributing to revenue was increased contracting services activity, largely resulting from more public agency and airport construction work, which also positively impacted asphalt volumes. Largely offsetting the increase was lower ready-mix concrete and aggregate volumes due to the timing of projects.

Gross profit and gross margin

Gross profit improved $1.4 million due to increased pricing outpacing costs for aggregates and ready-mix products, as well as improved contracting services gross profit from higher revenues, as previously discussed, disciplined project bidding, and project timing. These increases were offset by lower aggregate and ready-mix volumes due to the timing of projects, as previously discussed, which contributed to a flat gross margin.

EBITDA and EBITDA margin

EBITDA remained unchanged, largely the result of improved gross profit, as previously discussed, offset by higher selling, general and administrative costs due to increased payroll-related costs. EBITDA margin decreased 50 basis points.

Nine Months Ended September 30, 2024, Compared to Nine Months Ended September 30, 2023

Revenue

Revenue increased $23.4 million primarily the result of increased pricing across all core product lines contributing $22.3 million of additional revenues and increased contracting services activity due to more Idaho public agency construction work and additional airport work, which also positively impacted asphalt volumes. These increases were partially offset by lower ready-mix concrete and aggregate volumes due to timing of projects.

Gross profit and gross margin

Gross profit improved $12.3 million and gross margin improved 150 basis points due in large part to increased contracting services margins from higher revenues. Also contributing to the gross profit was increased pricing across all core product lines outpacing costs. Offsetting these increases were lower aggregate and ready-mix concrete volumes, as previously discussed.

EBITDA and EBITDA margin

EBITDA improved $10.5 million and EBITDA margin improved 120 basis points, largely the result of improved gross profit, as previously discussed. Partially offsetting the increase was the absence of asset sale gains of $2.0 million in the prior year.

Index

Results of Operations - Central

	Three Months Ended							~~Nine Months Ended~~
	September 30,							September 30,
	March 31,
	2024			2023			% Change	2024			2023			% Change
	2025			2024			% Change
	(In millions)
Revenue	$	~~354~~67.9		$	~~354~~61.90		—11%	$	~~630.5~~		$	~~643.6~~		~~(2)%~~
Gross profit	$	85.4		$	80.4		6%	$	110.6		$	101.1		9%
EBITDA	$	(24.3)		$	(18.7)		(30)%
Gross margin	24.1		%	22.6		%		17.5		%	15.7		%
EBITDA margin	(35.8)		%	(30.7)		%
EBITDA	$	79.8		$	74.8		7%	$	97.3		$	86.3		13%
EBITDA margin	22.5		%	21.1		%		15.4		%	13.4		%

Three Months Ended

~~Nine Months Ended~~

September 30,

March 31,

2024

2023

2024

2023

2025

2024

(In millions)

Revenues:

Aggregates

6217.71

6315.19

~~121.5~~

~~117.8~~

Ready-mix concrete

8525.56

8523.30

~~170.7~~

~~172.9~~

Asphalt

966.08

~~105~~5.61

~~146.3~~

~~164.8~~

Other*

~~12.~~2.4

101.29

~~25.0~~

~~22.7~~

Contracting services

~~209~~24.35

~~213~~21.82

~~338.9~~

~~357.2~~

Internal sales

(~~110.~~8.5)

(~~123~~6.1)

~~(171.9)~~

~~(191.8)~~

~~354~~67.9

~~354~~61.90

~~630.5~~

~~643.6~~

*Other includes merchandise and other products that individually are not considered to be a core line of business for the segment.

Three Months Ended ~~September~~March 3031, ~~2024~~2025, Compared to Three Months Ended ~~September~~March 3031, ~~2023~~2024

Revenue increased $6.9 million in the quarter driven primarily by increased construction activity late in the quarter for public-agency paving projects in Texas, which also contributed to additional asphalt volumes, and higher ready-mix and aggregate sales volumes across the segment. Price increases of $900,000 on ready-mix concrete and asphalt also had a positive impact to the quarter. In addition, $2.9 million of the increase was due to the addition of Strata in March of 2025.

~~Revenue~~EBITDA ~~remained~~decreased ~~steady~~$5.6 million ~~year-over-year~~driven largely ~~due~~by toan ~~price~~increase ~~increases~~in onselling, ~~ready-mix~~general ~~concrete~~ and ~~asphalt~~administrative ~~contributing~~costs of $114.23 million., ~~Offsetting~~partly due to the ~~pricing~~addition ~~increase~~of ~~was~~the aoperations ~~decrease~~of Strata in ~~asphalt~~March of 2025 and ~~ready~~higher labor-~~mix~~related ~~concrete~~costs ~~volumes~~primarily due to additional positions as the segment continues to grow and ~~less~~expand ~~contracting~~its ~~services~~operations. ~~work~~In addition, ~~which~~our ~~were~~northern ~~the~~operations ~~result~~experienced ofa ~~our~~$2.5 ~~EDGE~~million increase in aggregate pre-~~related~~productions ~~initiative~~costs. ofPartially ~~quality~~offsetting ofthe ~~work~~decrease ~~over~~were ~~quantity~~higher ofmargins ~~work~~on both ready-mix concrete and asphalt due to price increases.

~~Gross profit and gross margin~~31

Gross profit improved $5.0 million and gross margin improved 150 basis points, largely driven by increased pricing for ready-mix concrete and asphalt that outpaced increased costs and higher aggregate gross profit due to lower equipment costs. Also positively contributing to the increase was higher margins for contracting services from disciplined project bidding.

EBITDA and EBITDA margin

EBITDA improved $5.0 million and EBITDA margin improved 140 basis points driven by increased gross profit, as previously discussed.

Nine Months Ended September 30, 2024, Compared to Nine Months Ended September 30, 2023

Revenue

Revenue decreased $13.1 million, resulting from lower asphalt and ready-mix concrete volumes and less contracting services revenues as a result of our EDGE-related initiative of quality of work over quantity of work. Partially offsetting the decrease in volumes was higher prices on the material product lines contributing $21.4 million.

Gross profit and gross margin

Gross profit improved $9.5 million and gross margin improved 180 basis points, largely the result of increased pricing of $21.4 million across the material product lines that outpaced increased costs and improved margins on contracting services work contributing $4.1 million additional gross profit from EDGE-related initiatives including disciplined project bidding and favorable project execution. Partially offsetting the improvement was reduced volumes in the asphalt and ready-mix product lines.

EBITDA and EBITDA margin

Index

Results of Operations - Energy Services

	Three Months Ended							~~Nine Months Ended~~
	September 30,							September 30,
	March 31,
	2024			2023			% Change	2024			2023			% Change
	2025			2024			% Change
	(In millions)
Revenue	$	~~125~~13.9		$	~~140~~12.68		~~(10)~~9%	$	~~214.9~~		$	~~234.1~~		~~(8)%~~
Gross profit	$	34.7		$	46.7		(26)%	$	53.7		$	68.2		(21)%
EBITDA	$	(7.8)		$	(2.5)		(214)%
Gross margin	27.5		%	33.3		%		25.0		%	29.1		%
EBITDA margin	(56.0)		%	(19.4)		%
EBITDA	$	33.7		$	45.7		(26)%	$	50.6		$	64.5		(22)%
EBITDA margin	26.8		%	32.5		%		23.5		%	27.6		%

	Three Months Ended				~~Nine Months Ended~~
	September 30,				September 30,
	March 31,
	2024		2023		2024		2023
	2025		2024
	(In millions)
Revenues:
Liquid Asphalt	$	~~110~~12.92	$	~~122~~11.60	$	~~187.3~~	$	~~203.8~~
Other*	203.90		213.81		~~38.3~~		~~37.8~~
Internal sales	(51.93)		(31.83)		~~(10.7)~~		~~(7.5)~~
	$	~~125~~13.9	$	~~140~~12.68	$	~~214.9~~	$	~~234.1~~

*Other includes fabric and spreading, burner fuels, merchandise and other products that individually are not considered to be a core line of business for the segment.

Three Months Ended ~~September~~March 3031, ~~2024~~2025, Compared to Three Months Ended ~~September~~March 3031, ~~2023~~2024

Revenue increased $1.1 million primarily due to contributions from the acquisition of Albina Asphalt in November 2024, partially offset by lower volumes in the Texas markets mainly due to below normal temperatures in the first two months of the quarter.

~~Revenue~~EBITDA decreased $145.73 million, as a result of higher operating costs of $3.8 million due ~~largely~~to the addition of seasonal costs to ~~lower~~prepare ~~pricing~~for the upcoming paving season at Albina. Additionally, planned maintenance activities for required railcar maintenance, as awell ~~result~~as ofcontinued ~~reduced~~tank ~~supply~~and ~~input~~equipment repair costs ~~across~~at our ~~market~~California ~~areas.~~terminals, ~~The~~contributed ~~decrease~~an additional $750,000 in ~~pricing~~expenses. ~~was~~We ~~slightly~~also ~~offset~~experienced byhigher ~~favorable~~selling, ~~market~~general ~~conditions~~and inadministrative ~~California~~costs ~~and~~of ~~Texas~~$2.2 inmillion compared to last year, primarily related to the ~~third~~addition ~~quarter~~of the Albina operations in 2024.

Gross profit and gross margin

Gross profit decreased $12.0 million and gross margin decreased 580 basis points, driven by the reduced market pricing and higher operating costs associated with plant repairs at our California terminal.

EBITDA and EBITDA margin

EBITDA decreased $12.0 million and EBITDA margin decreased 570 basis points, which was related to decreased gross profit, as previously discussed.

Nine Months Ended September 30, 2024, Compared to Nine Months Ended September 30, 2023

Revenue

Revenue decreased $19.2 million due to lower pricing as a result of reduced supply input costs across our market areas. Liquid asphalt sales volumes were up slightly, primarily from strong demand in California and Texas, which were partially offset by decreased volumes in the Midwest due to less carryover jobs year-over-year.

Gross profit and gross margin

Gross profit decreased $14.5 million and gross margin decreased 410 basis points, driven by the reduced market pricing in addition to increased operating costs.

EBITDA and EBITDA margin

EBITDA decreased $13.9 million and EBITDA margin decreased 410 basis points, which was related to decreased gross profit, as previously discussed, offset in part by lower selling, general and administrative costs related to lower payroll-related costs.

Index

Corporate Services and Eliminations

Corporate Services includes all expenses related to the corporate functions of ~~the~~our ~~Company~~company, as well as insurance activity at our captive insurer; interest expense on a majority of ~~the~~our ~~Company's~~ long-term debt; interest income; and unrealized gains or losses on investments for ~~the Company's~~ nonqualified benefit plans.

Three Months Ended ~~September~~March 3031, ~~2024~~2025, Compared to Three Months Ended ~~September~~March 3031, ~~2023~~2024

During the ~~third~~first quarter of ~~2024~~2025, Corporate Services contributed negative EBITDA of $1318.70 million, compared to negative EBITDA of $1512.67 million in the prior year. ~~EBITDA~~Corporate ~~was~~Services ~~positively~~had ~~impacted by~~ higher ~~gains~~selling, ongeneral ~~nonqualified~~and ~~benefit~~administrative ~~plans~~costs of $1.3 .8 million ~~and~~in ~~additional~~the ~~income~~quarter, ~~from~~driven ~~third-party~~largely ~~training~~by ~~courses~~higher atdue ~~the~~diligence ~~Knife~~and ~~River~~integration ~~Training~~costs ~~Center~~of $5.8 ~~Partially~~million ~~offsetting~~related ~~these~~to ~~benefits~~corporate ~~was~~development aand ~~slight~~completed ~~increase~~acquisitions, inas ~~selling,~~well ~~general~~as ~~and~~higher ~~administrative~~labor-related costs ~~consisting~~for ~~primarily~~additional ofstaff ~~$2.2 million of due diligence~~ and ~~integration~~stock-based ~~costs~~compensation ~~related~~expense. toOffsetting ~~corporate~~these ~~development,~~increased ~~higher~~costs ~~health~~was ~~care~~the ~~costs~~absence of ~~$1.9 million~~one-time ~~and~~Separation ~~additional~~costs ~~information~~in ~~technology~~2024 ~~costs~~ of $1.17 million. ~~Offsetting~~and ~~these~~lower ~~costs~~health ~~were~~care ~~less~~costs ~~one-time~~due ~~Separation~~to ~~costs~~the absence of ~~$3.6~~a ~~million,~~high ~~primarily~~dollar ~~related~~claim toin ~~insurance~~2024. ~~costs~~Corporate ~~and~~Services ~~the~~also ~~transition~~had ~~services~~lower ~~agreement~~returns ~~with~~on ~~MDU~~our ~~Resources,~~nonqualified ~~and~~benefit aplan ~~reduction~~investments in ~~insurance~~2025, ~~loss~~which ~~reserves~~reduced atEBITDA ~~our~~by ~~captive~~$1.8 ~~insurer~~million.

Nine Months Ended September 30, 2024, Compared to Nine Months Ended September 30, 2023

Corporate Services contributed negative EBITDA of $42.3 million, or $10.5 million less EBITDA compared to the prior year. Corporate Services had increased selling, general and administrative costs of $11.5 million. The increase in costs for non-Separation related expenses include higher health care costs of $4.6 million, partly due to 2023 claims being paid from the MDU Resources health and welfare trust, due diligence and integration costs related to corporate development of $2.6 million and higher information technology costs of $1.0 million, partially offset by a reduction in insurance loss reserves at our captive insurer of $2.6 million. As a result of the Separation, Corporate Services experienced higher recurring costs as a publicly traded company of $6.6 million, including payroll-related costs of $9.5 million, largely due to additional staff and stock-based compensation expenses for the management team and board of directors; information technology costs of $2.8 million; professional services of $2.0 million; fees of $870,000 primarily related to fees on new debt issued in conjunction with the Separation; and insurance costs of $600,000. These recurring costs were partially offset by a reduction in general corporate expenses from MDU Resources of $9.0 million, as discussed in Note 2. Also, as part of the Separation, we incurred less one-time costs of $2.8 million, primarily related to insurance costs and the transition services agreement with MDU Resources.

Liquidity and Capital Resources

At ~~September~~March 3031, ~~2024~~2025, we had unrestricted cash and cash equivalents of $~~220~~86.41 million, working capital of $~~733~~624.56 million and borrowing capacity of $~~329~~477.41 million on our revolving credit agreement, net of our outstanding letters of credit. Working capital is calculated as current assets less current liabilities. As of ~~September~~March 3031, ~~2024~~2025, we ~~have~~had sufficient liquid assets, ~~cash flows from operations~~ and borrowing capacity to meet our financial commitments, debt obligations and anticipated capital expenditures for at least the next 12 months.

Index

Given the seasonality of our business, we typically experience significant fluctuations in working capital needs and balances throughout the year. Working capital requirements generally increase in the first half of the year as we build up inventory and focus on preparing our equipment, facilities and crews for our construction season. Working capital levels then decrease as the construction season winds down and we collect on receivables.

~~Knife~~The ~~River’s~~ ability to fund ~~its~~our cash needs will depend on the ongoing ability to generate cash from operations and obtain debt financing with competitive rates. ~~Knife~~We ~~River~~rely ~~relies~~ on access to capital markets as sources of liquidity for capital requirements not satisfied by cash flows from operations, particularly in the first half of the year due to the seasonal nature of the business. Our principal uses of cash in the future will be to fund our operations, working capital needs, capital expenditures, repayment of debt and strategic business development transactions.

On March 7, 2025, we entered into an amendment to our senior secured credit agreement to increase our revolving credit agreement from $350 million to $500 million and extend the maturity to March 7, 2030, refinance our existing $275 million Term Loan A with a maturity of March 7, 2030, and provide for a new Term Loan B in an aggregate principal amount of $500.0 million with a maturity date of March 8, 2032. For more information on the debt agreements and covenant restrictions, see Note 13.

Capital expenditures

We are committed to a disciplined ~~use of~~ capital allocation, including reinvesting in ~~the~~our company to maintain fixed assets, improve operations and grow our ~~operations~~business. ~~We allocate capital expenditures in two categories, which align with our EDGE strategy, as follows:~~

~~•Discipline~~We -currently ~~Support~~estimate total 2025 capital expenditures for maintenance and ~~Improve~~improvement ~~Existing~~to ~~Operations~~be between $155 million and $215 million. For the three months ended March 31, 2025, we spent $63.9 million, largely on the replacement of depleting aggregate reserves, construction equipment and plant improvements.

~~◦Maintenance:~~Additionally, ~~Plant~~for the three months ended March 31, 2025, we spent $454.5 million on growth initiatives, including $433.4 million on Strata (net of working capital adjustments and ~~equipment;~~cash acquired), $10.0 million on an aggregate ~~reserve~~quarry ~~replacement~~operation and $11.1 million on greenfield projects. As part of the Strata acquisition, we also received proceeds of $14.5 million on the sale of four ready-mix plant operations. For the remainder of 2025, we estimate to spend an additional $57 million on organic growth projects. Capital expenditures for future acquisitions and future organic growth opportunities would be incremental to our outlined capital program. It is anticipated that capital expenditures for 2025 will be funded by various sources, including internally generated cash and debt facilities.

~~◦Improvements:~~In ~~Productivity~~addition to cash on hand, ~~safety~~we used the proceeds from the issuance of a new $500 million Term Loan B facility to fund a portion of Strata's purchase price. Separately, ~~quality~~we ~~and~~also ~~environmental~~increased ~~improvements~~the ~~that~~total ~~drive~~commitments ~~return~~under onour ~~invested~~existing ~~capital~~revolving credit facility from $350 million to $500 million for future expenditures and ~~support~~extended the maturity date of our ~~core~~existing ~~values~~senior secured credit facilities from 2028 to 2030.

We estimate 2024 capital expenditures for our Discipline category to be between $170 million and $200 million, with $127.2 million spent as of September 30, 2024. The majority has been spent on routine replacement of vehicles and equipment, plant improvements and buildings.

Index

•Growth - Expand Operations

◦Organic: Greenfield growth in new markets; additional operations in existing markets.

◦Acquisition: Purchase bolt-on or new platform operations in mid-sized, high-growth markets; focused on materials.

As of November 4, 2024, we have invested $129.3 million in our Growth category on six acquisitions which include aggregate reserves, ready-mix and liquid asphalt operations. Within the Growth category, we have $23.1 million approved for the remainder of 2024 for the initial stages of approved greenfield projects.

Capital expenditures for future acquisitions and organic opportunities would be incremental to the outlined capital program; these opportunities are dependent upon economic and other competitive conditions. It is anticipated that capital expenditures for 2024 will be funded by various sources, including internally generated cash and debt.

Cash flows

	Nine Months Ended
	Three Months Ended
	September 30,
	March 31,
	2024		2023
	2025		2024
	(In millions)
Net cash provided by (used in)
Operating activities	$	~~149~~(125.93)	$	~~152~~(43.92)
Investing activities	(~~137~~503.86)		(8245.91)
Financing activities	(7486.0)3		36(3.13)
Increase in cash, cash equivalents and restricted cash	5.1		106.1
Decrease in cash, cash equivalents and restricted cash	(142.6)		(91.6)
Cash, cash equivalents and restricted cash -- beginning of year	~~262~~281.31		10262.13
Cash, cash equivalents and restricted cash -- end of period	$	~~267~~138.45	$	~~116~~170.27

~~Operating activities~~ 33

	Nine Months Ended
	September 30,
	2024		2023		Variance
	(In millions)
Components of net cash provided by operating activities:
Net income	$	178.4	$	162.2	$	16.2
Adjustments to reconcile net income to net cash provided by operating activities	115.1		93.0		22.1
Changes in current assets and liabilities, net of acquisitions:
Receivables	(224.8)		(302.5)		77.7
Due from related-party	—		16.1		(16.1)
Inventories	(27.3)		8.6		(35.9)
Other current assets	11.1		(20.2)		31.3
Accounts payable	77.2		91.6		(14.4)
Due to related-party	—		(7.3)		7.3
Other current liabilities	17.3		78.0		(60.7)
Pension and postretirement benefit plan contributions	(2.5)		(1.6)		(.9)
Other noncurrent charges	5.4		35.0		(29.6)
Net cash provided by operating activities	$	149.9	$	152.9	$	(3.0)

Cash provided by operating activities at September 30, 2024, decreased $3.0 million, largely related to higher working capital needs. Cash used by working capital components totaled $146.5 million for the nine months ended September 30, 2024, compared to $135.7 million for the nine months ended September 30, 2023. This increase in cash usage in 2024 was the result of higher accrued compensation due in part to additional employees associated with the Separation; higher liquid asphalt and aggregate inventory balances, due in part to higher costs of aggregate inventory; timing of prepaid insurance due to the Separation; the removal of all related-party balances due to the Separation; and fluctuations in the timing of payment on accounts payable. Partially offsetting these decreases were stronger collections on receivables balances during 2024 and higher net income.

Index

Operating activities


	Three Months Ended
	March 31,
	2025		2024		Variance
	(In millions)
Components of net cash used in operating activities:
Net loss	$	(68.7)	$	(47.6)	$	(21.1)
Adjustments to reconcile net loss to net cash used by operating activities	38.2		32.2		6.0
Changes in current assets and liabilities, net of acquisitions:
Receivables	41.1		76.8		(35.7)
Inventories	(50.4)		(56.2)		5.8
Other current assets	(35.5)		(16.5)		(19.0)
Accounts payable	(12.8)		(4.2)		(8.6)
Other current liabilities	(40.3)		(39.7)		(.6)
Pension and postretirement benefit plan contributions	(.1)		(.1)		—
Other noncurrent charges	3.2		12.1		(8.9)
Net cash used in operating activities	$	(125.3)	$	(43.2)	$	(82.1)

Cash used in operating activities at March 31, 2025, increased $82.1 million, largely related to higher working capital needs and higher net loss in the period. Cash used by working capital components totaled $97.9 million for the three months ended March 31, 2025, compared to $39.8 million for the three months ended March 31, 2024. The change in cash was primarily the result of higher receivables due to lower collections and higher revenues in first quarter 2025; timing of prepaid insurance and income taxes; and fluctuations in the timing of payment on accounts payable. Partially offsetting these changes was lower aggregates inventory due to lower production in the quarter, offset in part by higher liquid asphalt with the addition of Albina in November of 2024.

Investing activities

	Nine Months Ended
	Three Months Ended
	September 30,
	March 31,
	2024		2023		Variance
	2025		2024		Variance
	(In millions)
Capital expenditures	$	(~~127~~75.20)	$	(8643.47)	$	(4031.83)
Acquisitions, net of cash acquired	(15443.04)		—		(15443.04)
Net proceeds from sale or disposition of property and other	717.65		51.26		215.49
Investments	(3.2.7)		(13.70)		(1.5)3
Net cash used in investing activities	$	(~~137~~503.86)	$	(8245.91)	$	(54458.95)

The increase in cash used in investing activities for the ~~nine~~three months ended ~~September~~March 3031, ~~2024~~2025, compared to the ~~nine~~three months ended ~~September~~March 3031, ~~2023~~2024, was primarily due to ~~higher~~the ~~capital~~acquisition ~~expenditures~~of Strata and an aggregates quarry operation in the first quarter of 2025, ~~including~~as adiscussed ~~liquid~~in ~~asphalt~~Note ~~expansion~~10, ~~project~~as ~~and~~well as higher capital expenditures, including routine replacement of vehicles and equipment, plant improvements and the replenishment of depleting aggregate reserves. InThe ~~addition,~~increase ~~three~~in ~~acquisitions~~cash ~~were~~usage ~~completed~~was offset in part by proceeds from the ~~first~~sale ~~nine~~of ~~months~~ready-mix operations in the Central segment in the first quarter of ~~2024~~2025, as discussed in Note 10.

Index

Financing activities

	Nine Months Ended
	Three Months Ended
	September 30,
	March 31,
	2024		2023		Variance
	2025		2024		Variance
	(In millions)
Issuance of long-term related-party notes, net	$	—	$	205.3	$	(205.3)
Issuance of long-term debt	$	500.0	$	—	$	500.0
Issuance of long-term debt	—		700.0		(700.0)
Repayment of long-term debt	—		(1.7)		1.7
Repayment of long-term debt	(5.3)		(1.9)		(3.4)
Debt issuance costs	(11.1)		—		(11.1)
Debt issuance costs	—		(16.7)		16.7
Tax withholding on stock-based compensation	(2.6)		(1.6)		(1.0)
Tax withholding on stock-based compensation	(1.7)		—		(1.7)
Net cash provided by (used in) financing activities	$	486.3	$	(3.3)	$	489.6
Net transfers to Centennial	—		(850.6)		850.6
Net cash provided by (used in) financing activities	$	(7.0)	$	36.1	$	(43.1)

The ~~decrease~~increase in cash flows provided by financing activities for the ~~nine~~three months ended ~~September~~March 3031, ~~2024~~2025, compared to the ~~nine~~three months ended ~~September~~March 3031, ~~2023~~2024, was largely related to ~~changes~~the infunding ~~the~~of ~~Company's~~a ~~debt~~new ~~structure~~Term asLoan aB ~~result~~in March of ~~the Separation~~2025, ~~which~~as ~~included~~discussed in Note 13. Offsetting the cash provided by long-term debt were higher debt issuance costs associated with the amendment of our senior ~~notes,~~secured ~~term~~credit ~~loans~~agreement ~~and~~to aincrease our revolving credit facility capacity, ~~and~~extend athe ~~transfer~~maturity date of the ~~majority~~revolving ofcredit facility and Term Loan A, and the ~~proceeds~~issuance toof ~~Centennial.~~a new Term Loan B.

Material cash requirements

There were no material changes in the contractual obligations from those reported in the ~~2023~~2024 Annual Report other than as set forth below. For more information on our contractual obligations on long-term debt, operating leases and purchase commitments, see Part II, Item 78 in the ~~2023~~2024 Annual Report.

Our material short-term and long-term cash requirements include repayment of third-party long-term debt and related interest payments, payments on operating lease agreements, payments of obligations on purchase commitments and asset retirement obligations.

At ~~September~~March 3031, ~~2024~~2025, our ~~purchase~~long-term ~~commitments~~debt reflected aan ~~decrease~~increase of approximately 22$500.0 ~~percent~~million from the balance at December 31, ~~2023~~2024. This ~~decrease~~increase is ~~primarily~~due ~~related~~ to ~~our~~issuing ~~fulfillment~~a ofnew ~~part~~$500 million ofTerm ~~the~~Loan ~~three-year~~B ~~cement~~facility ~~contract~~with ~~entered into during 2023. In addition, due to~~ the ~~seasonality~~proceeds ~~of work and the third quarter~~ being ~~its~~used ~~peak construction season, our purchase commitments saw an expected decrease from the balance at June 30, 2024. We expect purchase commitments~~ to ~~continue~~fund toa ~~decrease~~portion ~~throughout the remainder~~ of ~~2024~~Strata's aspurchase ~~obligations continue to be satisfied during the construction season~~price.

At March 31, 2025, our total estimated interest payments over the life of our debt reflected an increase of approximately $243.0 million from the total estimated interest payments at December 31, 2024. This increase is due to the change in long-term debt outstanding related to the new Term Loan B previously mentioned.

Defined benefit pension plans

We have noncontributory qualified defined benefit pension plans for certain employees. Various assumptions are used in calculating the benefit expense (income) and liability (asset) related to these plans. Costs of providing these benefits are dependent upon assumptions of future conditions and bear the risk of changing.

There were no ~~other~~ material changes to our qualified noncontributory defined benefit pension plans from those reported in the ~~2023~~2024 Annual Report. ~~other~~We ~~than~~do ~~increased~~not ~~contributions~~expect ofto ~~approximately~~make ~~$2.1 million~~any ~~made~~pension toplan ~~our~~contributions ~~pension~~in ~~plans~~2025 ~~during~~as the ~~third~~plan ~~quarter~~is offully ~~2024~~funded. ~~The increase was driven by additional discretionary contributions.~~ For more information, see ~~Note 17 and~~ Part II, Item 78 in the ~~2023~~2024 Annual Report.

Index

Non-GAAP Financial Measures

The Business Segment Financial and Operating Data includes financial information prepared in accordance with GAAP, as well as EBITDA, EBITDA margin, Adjusted EBITDA and Adjusted EBITDA margin, ~~financial~~as ~~measures.~~well ~~These~~as ~~non-GAAP~~total ~~financial~~segment measures, ~~including those measures by segment,~~ as applicable, that are considered non-GAAP measures of financial performance. These non-GAAP financial measures are not measures of financial performance under GAAP. The items excluded from these non-GAAP financial measures are significant components in understanding and assessing financial performance. Therefore, these non-GAAP financial measures should not be considered substitutes for the applicable GAAP metric.

EBITDA, EBITDA margin, Adjusted EBITDA and Adjusted EBITDA margin are most directly comparable to the corresponding GAAP measures of net income and net income margin. We believe these non-GAAP financial measures, in addition to corresponding GAAP measures, are useful to investors by providing meaningful information about operational efficiency compared to our peers by excluding the impacts of differences in tax jurisdictions and structures, debt levels and capital investment. We believe Adjusted EBITDA and Adjusted EBITDA margin are useful performance measures because they allow for an effective evaluation of our operating performance by excluding stock-based compensation and unrealized gains and losses on benefit plan investments as they are considered non-cash and not part of our core operations. We also exclude the one-time, non-recurring costs associated with the Separation as those are not expected to continue. We believe EBITDA and Adjusted EBITDA assist rating agencies and investors in comparing operating performance across operating periods on a consistent basis by excluding items management does not believe are indicative of the Company's operating performance. Additionally, EBITDA and Adjusted EBITDA are important financial metrics for debt investors who utilize debt to EBITDA and debt to Adjusted EBITDA ratios. We believe these non-GAAP financial measures, including those measures by segment, are useful performance measures because they provide clarity as to the operational results of the Company. Our management uses these non-GAAP financial measures in conjunction with GAAP results when evaluating our operating results internally and calculating employee incentive compensation.

EBITDA is calculated by adding back income taxes, interest expense (net of interest income) and depreciation, depletion and amortization expense to net income. EBITDA margin is calculated by dividing EBITDA by revenues. Adjusted EBITDA is calculated by adding back unrealized gains and losses on benefit plan investments, stock-based compensation and one-time Separation costs, to EBITDA. Adjusted EBITDA margin is calculated by dividing Adjusted EBITDA by revenues. These non-GAAP financial measures are calculated the same for both the segment and consolidated metrics and should not be considered as alternatives to, or more meaningful than, GAAP financial measures such as net income or net income margin, and are intended to be helpful supplemental financial measures for investors’ understanding of our operating performance. Our non-GAAP financial measures are not standardized; therefore, it may not be possible to compare these financial measures with other companies’ EBITDA, EBITDA margin, Adjusted EBITDA and Adjusted EBITDA margin measures having the same or similar names.35

The following information reconciles segment and consolidated net income (loss) to EBITDA and Adjusted EBITDA and provides the calculation of EBITDA margin and Adjusted EBITDA margin. Interest expense, net, is net of interest income that is included in other income on the Consolidated Statements of Operations.

Three Months Ended September 30, 2024	Pacific			Northwest			Mountain			Central			Energy Services			Corporate Services and Eliminations		Consolidated
	(In millions)
Net income (loss)	$	23.4		$	45.2		$	52.7		$	70.1		$	32.4		$	(75.7)	$	148.1
Depreciation, depletion and amortization	6.1			10.7			6.7			9.7			1.3			.3		34.8
Interest expense, net	—			—			—			—			—			12.1		12.1
Income taxes	—			—			—			—			—			49.6		49.6
EBITDA	$	29.5		$	55.9		$	59.4		$	79.8		$	33.7		$	(13.7)	$	244.6
Unrealized (gains) losses on benefit plan investments																$	(1.2)	$	(1.2)
Stock-based compensation expense																1.8		1.8
Adjusted EBITDA																$	(13.1)	$	245.2
Revenue	$	165.0		$	218.1		$	261.1		$	354.9		$	125.9		$	(19.7)	$	1,105.3
Net income margin	14.2		%	20.7		%	20.2		%	19.8		%	25.8		%	N.M.		13.4		%
EBITDA margin	17.9		%	25.6		%	22.8		%	22.5		%	26.8		%	N.M.		22.1		%
Adjusted EBITDA margin																N.M.		22.2		%

*N.M. - not meaningful

Index

Three Months Ended September 30, 2023	Pacific			Northwest			Mountain			Central			Energy Services			Corporate Services and Eliminations		Consolidated
	(In millions)
Net income (loss)	$	23.1		$	38.7		$	53.1		$	66.1		$	44.5		$	(78.8)	$	146.7
Depreciation, depletion and amortization	5.5			9.8			6.3			8.7			1.2			.3		31.8
Interest expense, net	—			—			—			—			—			14.7		14.7
Income taxes	—			—			—			—			—			48.2		48.2
EBITDA	$	28.6		$	48.5		$	59.4		$	74.8		$	45.7		$	(15.6)	$	241.4
Unrealized (gains) losses on benefit plan investments																$	.6	$	.6
Stock-based compensation expense																1.5		1.5
One-time separation costs																4.0		4.0
Adjusted EBITDA																$	(9.5)	$	247.5
Revenue	$	157.3		$	209.4		$	255.1		$	354.9		$	140.6		$	(26.9)	$	1,090.4
Net income margin	14.7		%	18.5		%	20.8		%	18.6		%	31.6		%	N.M.		13.4		%
EBITDA margin	18.2		%	23.2		%	23.3		%	21.1		%	32.5		%	N.M.		22.1		%
Adjusted EBITDA margin																N.M.		22.7		%

are indicative of our operating performance. Additionally, EBITDA and Adjusted EBITDA are important financial metrics for debt investors who utilize debt to EBITDA and debt to Adjusted EBITDA ratios. We believe these non-GAAP financial measures, including total segment measures, as applicable, are useful performance measures because they provide clarity as to our operational results. Our management uses these non-GAAP financial measures in conjunction with GAAP results when evaluating our operating results internally and calculating employee incentive compensation.

*NEBITDA is calculated by adding back income taxes, interest expense (net of interest income) and depreciation, depletion and amortization expense to net income (loss).M EBITDA margin is calculated by dividing EBITDA by revenues. Adjusted EBITDA is calculated by adding back unrealized gains and losses on benefit plan investments, stock-based compensation and one-time Separation costs, to EBITDA. Adjusted EBITDA margin is calculated by dividing Adjusted EBITDA by revenues. These non-GAAP financial measures are calculated the same for both the total segment and consolidated metrics and should not be considered as alternatives to, or more meaningful than, GAAP financial measures such as net income or net income margin, and are intended to be helpful supplemental financial measures for investors’ understanding of our operating performance. Our non-GAAP financial measures are not standardized; therefore, it may not be possible to compare these financial measures with other companies’ EBITDA, EBITDA margin, Adjusted EBITDA and Adjusted EBITDA margin measures having the same or similar names.

Nine Months Ended September 30, 2024	Pacific			Northwest			Mountain			Central			Energy Services			Corporate Services and Eliminations		Consolidated
	(In millions)
Net income (loss)	$	28.5		$	95.1		$	76.8		$	69.7		$	46.8		$	(138.5)	$	178.4
Depreciation, depletion and amortization	18.0			31.7			19.6			27.6			3.8			.8		101.5
Interest expense, net	—			—			.1			—			—			36.0		36.1
Income taxes	—			—			—			—			—			59.4		59.4
EBITDA	$	46.5		$	126.8		$	96.5		$	97.3		$	50.6		$	(42.3)	$	375.4
Unrealized (gains) losses on benefit plan investments																$	(2.8)	$	(2.8)
Stock-based compensation expense																5.4		5.4
One-time separation costs																3.8		3.8
Adjusted EBITDA																$	(35.9)	$	381.8
Revenue	$	375.2		$	539.7		$	514.9		$	630.5		$	214.9		$	(33.4)	$	2,241.8
Net income margin	7.6		%	17.6		%	14.9		%	11.1		%	21.8		%	N.M.		8.0		%
EBITDA margin	12.4		%	23.5		%	18.7		%	15.4		%	23.5		%	N.M.		16.7		%
Adjusted EBITDA margin																N.M.		17.0		%

The following information reconciles segment and consolidated net loss to EBITDA and Adjusted EBITDA and provides the calculation of EBITDA margin and Adjusted EBITDA margin. Interest expense, net, is net of interest income that is included in other income on the Consolidated Statements of Operations.

*N.M. - not meaningful


	Three Months Ended
	March 31,
	2025			2024
	(In millions)
Net loss	$	(68.7)		$	(47.6)
Depreciation, depletion and amortization	38.8			32.2


Interest expense, net	13.1			11.1
Income taxes	(24.7)			(16.3)
EBITDA	$	(41.5)		$	(20.6)
Unrealized (gains) losses on benefit plan investments	.7			(1.2)
Stock-based compensation expense	2.8			1.8

One-time separation costs	—			2.3
Adjusted EBITDA	$	(38.0)		$	(17.7)

Revenue	$	353.5		$	329.6
Net loss margin	(19.4)		%	(14.5)		%
EBITDA margin	(11.7)		%	(6.2)		%
Adjusted EBITDA margin	(10.7)		%	(5.4)		%

Index

Nine Months Ended September 30, 2023	Pacific			Northwest			Mountain			Central			Energy Services			Corporate Services and Eliminations		Consolidated
	(In millions)
Net income (loss)	$	30.2		$	72.9		$	67.4		$	61.1		$	60.8		$	(130.2)	$	162.2
Depreciation, depletion and amortization	15.9			28.4			18.5			25.2			3.7			0.8		92.5
Interest expense, net	—			—			0.1			—			—			41.3		41.4
Income taxes	—			—			—			—			—			56.3		56.3
EBITDA	$	46.1		$	101.3		$	86.0		$	86.3		$	64.5		$	(31.8)	$	352.4
Unrealized (gains) losses on benefit plan investments																$	(1.1)	$	(1.1)
Stock-based compensation expense																2.3		2.3
One-time separation costs																6.4		6.4
Adjusted EBITDA																$	(24.2)	$	360.0
Revenue	$	348.1		$	504.2		$	491.5		$	643.6		$	234.1		$	(38.0)	$	2,183.5
Net income margin	8.7		%	14.5		%	13.7		%	9.5		%	26.0		%	N.M.		7.4		%
EBITDA margin	13.3		%	20.1		%	17.5		%	13.4		%	27.6		%	N.M.		16.1		%
Adjusted EBITDA margin																N.M.		16.5		%

*N.M. - not meaningful

New Accounting Standards

For information regarding new accounting standards, see Note 3, which is incorporated by reference.

Critical Accounting Estimates

~~Knife~~Our ~~River's~~ critical accounting estimates include revenue recognized using the cost-to-cost measure of progress for contracts; fair values of acquired assets and liabilities assumed under the acquisition method of accounting; impairment testing of goodwill; and impairment testing of long-lived assets excluding goodwill. There were no material changes in the Company's critical accounting estimates from those that were previously reported in the Company's ~~2023~~2024 Annual Report.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

~~The~~We ~~Company~~are is exposed to the impact of market fluctuations associated with interest rates and commodity prices. We have policies and procedures to assist in controlling these market risks and from time to time have utilized derivatives to manage a portion of our risk.

Interest rate risk

As of ~~September~~March 3031, ~~2024~~2025, ~~the~~we ~~Company~~ had $~~266~~764.47 million in term loans outstanding which bear interest at a variable rate. As of ~~September~~March 3031, ~~2024~~2025, the weighted-average rate in effect was 6.4520 percent, therefore, a hypothetical increase of 1.00 percent to the interest rate at September 30, 2024, would increase the all-in rate to 7.45 percent, the effect of which would increase the Company's interest expense by $2.7 million over the next 12 months based on the balances outstanding for these borrowings as of September 30, 2024.

~~At September 30, 2024, the Company had no outstanding interest rate hedges.~~36

Index

at March 31, 2025, would increase the all-in rate to 7.20 percent, the effect of which would increase the Company's interest expense by $7.6 million over the next 12 months based on the balances outstanding for these borrowings as of March 31, 2025.

At March 31, 2025, we had no outstanding interest rate hedges.

Commodity price risk

There were no material changes to commodity price risk ~~faced~~that bywe ~~the~~faced ~~Company~~ from those reported in the ~~2023~~2024 Annual Report.

Item 4. Controls and Procedures

Evaluation of disclosure controls and procedures

The term "disclosure controls and procedures" is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. The Company's disclosure controls and other procedures are designed to provide reasonable assurance that information required to be disclosed in the reports that the Company files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms. The Company's disclosure controls and other procedures are designed to provide reasonable assurance that information required to be disclosed is accumulated and communicated to management, including the Company's chief executive officer and chief financial officer, to allow timely decisions regarding required disclosure. The Company's management, with the participation of the Company's chief executive officer and chief financial officer, has evaluated the effectiveness of the Company's disclosure controls and other procedures as of the end of the period covered by this report. Based upon that evaluation, the chief executive officer and the chief financial officer have concluded that, as of the end of the period covered by this report, such controls and procedures were effective at a reasonable assurance level.

Index

officer, has evaluated the effectiveness of the Company's disclosure controls and other procedures as of the end of the period covered by this report. Based upon that evaluation, the chief executive officer and the chief financial officer have concluded that, as of the end of the period covered by this report, such controls and procedures were effective at a reasonable assurance level.

Changes in internal controls

NoWe ~~change~~completed inthe acquisitions of Albina Asphalt and Strata Corporation on November 2, 2024 and March 7, 2025, respectively. Under the ~~Company's~~guidelines established by the SEC, companies are permitted to exclude acquisitions from their assessment of internal control over financial reporting ~~(as~~during ~~defined~~the infirst ~~Rules 13a-15(f)~~year ~~and~~of ~~15d-15(f)~~an ~~under~~acquisition while integrating the ~~Exchange~~acquired ~~Act)~~company. ~~occurred~~We ~~during~~are in the ~~three~~process ~~months~~of ~~ended~~assessing ~~September 30,~~the ~~2024,~~internal ~~that~~control ~~has~~over ~~materially~~financial ~~affected,~~reporting orof isthe ~~reasonably~~acquired ~~likely~~companies toand ~~materially~~integrating ~~affect,~~them ~~the~~with ~~Company's~~our existing internal ~~control~~controls over financial reporting.

45Except as noted above, there were no changes in our internal controls over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the quarter ended March 31, 2025, that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.

Index

Part II -- Other Information

Item 1. Legal Proceedings

There were no material changes to the Company's legal proceedings that were previously reported in Part 1, Item 3 - Legal Proceedings in the ~~2023~~2024 Annual Report.

Item 1A. Risk Factors

Refer to the Company's risk factors that are disclosed in Part I, Item 1A. Risk Factors in its ~~2023~~2024 Annual Report that could be materially harmful to the Company's business, prospects, financial condition or financial results if they occur.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

For information regarding mine safety violations or other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K, see Exhibit 95 to this Form 10-Q, which is incorporated herein by reference.

Item 5. Other Information

During the three months ended ~~September~~March 3031, ~~2024~~2025, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

Item 6. Exhibits

See the index to exhibits immediately preceding the signature page to this report.

4638

Index

Exhibits Index

Incorporated by Reference

Exhibit Number

Exhibit Description

FiledHerewith

FurnishedHerewith

Form

PeriodEnded

Exhibit

FilingDate

File Number

3(a)

Amended and Restated Certificate of Incorporation of Knife River Corporation

8-K

3.1

6/01/23

1-41642

3.1

Amended and Restated Certificate of Incorporation of Knife River Corporation

8-K

3.1

6/01/23

1-41642

3(b)

Amended and Restated Bylaws of Knife River Corporation

8-K

3.2

6/01/23

1-41642

3.2

Amended and Restated Bylaws of Knife River Corporation

8-K

3.2

6/01/23

1-41642

10.1+

Knife River Corporation Change in Control Severance Plan

8-K

10.1

8/20/24

1-41642

*10.1

First Amendment, dated as of March 7, 2025, among Knife River Corporation, as borrower, the guarantors party thereto, the lenders and other parties party thereto, and JPMorgan Chase Bank, N.A., as administrative agent

8-K

10.1

3/10/25

1-41642

31(a)

Certification of Chief Executive Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

10.2+

Form of Restricted Stock Unit Award Agreement under the Long-Term Performance-Based Incentive Plan, effective February 27, 2025

31(b)

Certification of Chief Financial Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

10.3+

Form of Performance Stock Unit Award Agreement under the Long-Term Performance-Based Incentive Plan, effective February 27, 2025

10.4+

Knife River Corporation, 401(k) Retirement Plan, as amended March 17, 2025

10.5+

Knife River Corporation Section 16 Officers and Directors with Indemnification Agreements Chart, as of April 19, 2025

10.6+

Form of Knife River Corporation Director and/or Executive Officer Indemnification Agreement

31.1

Certification of Chief Executive Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2

Certification of Chief Financial Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

Certification of Chief Executive Officer and Chief Financial Officer furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Mine Safety Disclosures

101.INS

XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document

101.SCH

XBRL Taxonomy Extension Schema Document

101.CAL

XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF

XBRL Taxonomy Extension Definition Linkbase Document

101.LAB

XBRL Taxonomy Extension Label Linkbase Document

101.PRE

XBRL Taxonomy Extension Presentation Linkbase Document

104

Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

+ Management contract, compensatory plan or arrangement.

* Certain schedules and exhibits have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Company agrees to furnish supplementally a copy of any omitted schedule or exhibit to the SEC upon its request.

4739

Index

Signatures

Pursuant to the requirements of the Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		Knife River Corporation
DATE:	~~November~~May 46, ~~2024~~2025	BY:	/s/ Nathan W. Ring
			Nathan W. Ring
			Vice President and Chief Financial Officer
		BY:	/s/ Marney L. Kadrmas
			Marney L. Kadrmas
			Chief Accounting Officer
			Vice President and Chief Accounting Officer

4840

Filing Compare · Knife River Corp