Page 152 - Martin Marietta - 2025 Proxy Statement

NOTES TO FINANCIAL STATEMENTS (Continued)
Purchase Commitments. The Company hadpurchasecommitments forproperty, plantand equipmentof $162 millionasof
December 31, 2024. The Companyalsohad otherpurchaseobligations relatedtoenergyand servicecontracts of $158 millionas
of December 31,2024. The Company’scontractual purchase commitments as of December 31,2024 are as follows:
(in millions)
2025 $ 215
2026 21
2027 15
2028 12
2029 12
Thereafter 45
Total $ 320

Capitalexpenditures in2024, 2023 and 2022 that were purchase commitments as of the prioryear end were $139 million, $111
millionand $90 million, respectively.
Contracts of Affreightment and Royalty Commitments. Future minimumcontracts of affreightmentand royalty commitments for
all noncancelableagreementsthatare notaccounted forasleasesonthe Company’sconsolidated balancesheet as of
December31, 2024 areas follows:

Contracts of Royalty
(in millions) Affreightment Commitments
2025 $ 17 $ 27
2026 17 15
2027 18 14
2028 — 13
2029 — 10
Thereafter — 86
Total $ 52 $ 165

Employees. Approximately 13% of the Company’s employees are represented by alabor union.All such employeesare hourly
employees. The Company maintains collectivebargaining agreements relating to theunion employees within the Building
Materials businessand Magnesia Specialtiessegment.All of thehourly employees of the MagnesiaSpecialties segment, located in
Manistee, Michigan, and Woodville,Ohio, are represented by laborunions. TheWoodville collective bargaining agreementexpires
in June 2026. The Manistee collectivebargaining agreementexpires in August 2027.

Note O: Segments
As of December 31,2024, the Building Materials business iscomprised offour divisionsthat represent individual operating
segments. These operating segmentsare consolidated into two reportablesegments, the East Group andthe West Group,for
financial reporting purposes, astheymeetthe aggregationcriteria. The MagnesiaSpecialties business represents an individual
operating and reportable segment. Theaccountingpoliciesused for segment reporting arethe same as thosedescribed in Note A.
The Company’s Chief Operating Decision Maker (CODM) is the Chair,President and Chief ExecutiveOfficer. The CODM reviews
results by reportable segmentona quarterly basisand allocates resources to achievethe Company’sstrategic objectives basedon
anevaluationof each reportablesegment’s performance. This evaluation is largely based on segmentearnings fromoperations,
as management believes this is thebest metricof segment profitabilityand operatingperformance.Segment earningsfrom
operations is also a measure in thedetermination of incentivecompensationtargets andawards. Segmentearnings from
operations include revenueslesscostofrevenues; selling, generaland administrative expenses;otheroperating incomeand
expenses, net; andexclude interest income andexpense;other nonoperating income andexpenses, net; and incometax expense.
The significantexpense categories shownbelow align withthe segment-level information regularly providedtothe CODM.Other
costsofrevenues for each reportable segment include mainly repairsand maintenance, contract services, suppliesand royalties.
Corporate loss from operations primarily includesdepreciationand amortization;expenses for corporateadministrative functions;
acquisition,divestiture and integration expenses; and othernonrecurring income andexpensesnot attributable to operations of
the Company'sother operating segments.

age44 ♦ 2024 Annual Report