Derivatives

3 Months Ended

Mar. 31, 2026

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivatives

NOTE 15—DERIVATIVES:

Diesel Price Risk Management Positions

The Company may sell or purchase forward contracts, swaps and options in the over-the-counter diesel market in order to manage its exposure to diesel prices. The Company has exposure to the risk of fluctuating diesel prices related to the amount of diesel fuel consumed during its operations. As of March 31, 2026 and December 31, 2025, the Company held diesel-related financial contracts to buy an aggregate notional volume of 1.8 million gallons and 3.6 million gallons, respectively, which will be settled throughout 2026.

The Company has master netting agreements with all of its counterparties that allow for the settlement of contracts in an asset position with contracts in a liability position in the event of default or termination. Such netting arrangements reduce the Company's credit exposure related to these counterparties to the extent the Company has any liability to such counterparties. For classification purposes, the Company records the net fair value of all the positions with a given counterparty as a net asset or liability in the Condensed Consolidated Balance Sheets. At March 31, 2026 and December 31, 2025, the net fair value of derivatives was $3,084 and $345, respectively, which were included in Other Current Assets in the accompanying Condensed Consolidated Balance Sheets.

The Company did not apply cash flow hedge accounting treatment for its commodity derivative financial instruments; therefore, changes in fair value are reflected in current earnings. During the three months ended March 31, 2026, the Company settled a portion of its commodity derivatives at a gain of $233 and recognized unrealized mark-to-market gains on its commodity derivatives of $2,932. The Company had no derivative activity during the three months ended March 31, 2025. Realized gains and unrealized mark-to-market gains are included in Cost of Sales and Other Operating Income and Expense, Net, respectively, on the accompanying Condensed Consolidated Statements of Income (Loss).

The Company classifies the cash effects of its derivatives within the Cash Flows from Operating Activities section of the Condensed Consolidated Statements of Cash Flows.