NOTE 2. SEGMENT RESULTS Our operating segments are as follows: Mineral Fiber, Architectural Specialties and Unallocated Corporate. Our Mineral Fiber and Architectural Specialties segment net sales represent the product-based group offerings we sell to external customers. Our Chief Operating Decision Maker (“CODM”) is our President and Chief Executive Officer. Effective April 1, 2026, our President and Chief Executive Officer (“CEO”), Victor Grizzle, transitioned to Executive Chair of our Board of Directors, and Mark Hershey, formerly our Senior Vice President and Chief Operating Officer, succeeded Victor Grizzle as President and CEO. Segment operating income (loss) is the measure of segment profit or loss reviewed by the CODM. The following tables are presented at the level of disaggregation regularly reviewed by the CODM to evaluate operating performance and allocate resources to segments:
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For the three months ended September 30, 2026 |
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Mineral Fiber |
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Architectural Specialties |
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Unallocated Corporate |
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Total |
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Net sales to external customers |
|
$ |
292.1 |
|
|
$ |
183.7 |
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$ |
- |
|
|
$ |
475.8 |
|
Cost of goods sold |
|
|
171.7 |
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|
|
113.1 |
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|
|
0.3 |
|
|
|
285.1 |
|
Gross profit (loss) |
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|
120.4 |
|
|
|
70.6 |
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|
|
(0.3 |
) |
|
|
190.7 |
|
SG&A expenses |
|
|
46.2 |
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|
|
44.9 |
|
|
|
0.2 |
|
|
|
91.3 |
|
(Gain) related to change in fair value of contingent consideration |
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|
- |
|
|
|
(0.1 |
) |
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|
- |
|
|
|
(0.1 |
) |
Equity (earnings) loss from unconsolidated affiliates, net |
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(31.8 |
) |
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- |
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|
|
0.1 |
|
|
|
(31.7 |
) |
Segment operating income (loss) |
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$ |
106.0 |
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$ |
25.8 |
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$ |
(0.6 |
) |
|
$ |
131.2 |
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Depreciation and amortization |
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$ |
22.4 |
|
|
$ |
9.8 |
|
|
$ |
- |
|
|
$ |
32.2 |
|
Purchases of property, plant and equipment |
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|
18.3 |
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|
|
6.4 |
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|
|
- |
|
|
|
24.7 |
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For the three months ended September 30, 2025 |
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Mineral Fiber |
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Architectural Specialties |
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|
Unallocated Corporate |
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Total |
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Net sales to external customers |
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$ |
274.0 |
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|
$ |
151.2 |
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|
$ |
- |
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|
$ |
425.2 |
|
Cost of goods sold |
|
|
155.3 |
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|
|
91.1 |
|
|
|
0.3 |
|
|
|
246.7 |
|
Gross profit (loss) |
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|
118.7 |
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|
|
60.1 |
|
|
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(0.3 |
) |
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|
178.5 |
|
SG&A expenses |
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|
49.1 |
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|
|
40.7 |
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|
|
0.3 |
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|
|
90.1 |
|
Loss related to change in fair value of contingent consideration |
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- |
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|
0.1 |
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- |
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|
0.1 |
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(Gain) on sales of fixed assets, net |
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(0.9 |
) |
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- |
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|
- |
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(0.9 |
) |
Equity (earnings) loss from unconsolidated affiliates, net |
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(28.2 |
) |
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- |
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|
0.2 |
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|
(28.0 |
) |
Segment operating income (loss) |
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$ |
98.7 |
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$ |
19.3 |
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|
$ |
(0.8 |
) |
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$ |
117.2 |
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|
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Depreciation and amortization |
|
$ |
21.6 |
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|
$ |
8.5 |
|
|
$ |
- |
|
|
$ |
30.1 |
|
Purchases of property, plant and equipment |
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|
18.5 |
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|
|
4.1 |
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|
- |
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22.6 |
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For the nine months ended September 30, 2026 |
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Mineral Fiber |
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Architectural Specialties |
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Unallocated Corporate |
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Total |
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Net sales to external customers |
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$ |
837.5 |
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|
$ |
520.2 |
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$ |
- |
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$ |
1,357.7 |
|
Cost of goods sold |
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|
493.8 |
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|
321.9 |
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|
1.0 |
|
|
|
816.7 |
|
Gross profit (loss) |
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|
343.7 |
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|
|
198.3 |
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(1.0 |
) |
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|
541.0 |
|
SG&A expenses |
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|
138.7 |
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|
134.0 |
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|
0.7 |
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|
|
273.4 |
|
Loss (gain) related to change in fair value of contingent consideration, net |
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|
1.0 |
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(0.2 |
) |
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- |
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|
0.8 |
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Equity (earnings) loss from unconsolidated affiliates, net |
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(92.8 |
) |
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|
- |
|
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|
0.4 |
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|
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(92.4 |
) |
Segment operating income (loss) |
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$ |
296.8 |
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$ |
64.5 |
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|
$ |
(2.1 |
) |
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$ |
359.2 |
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|
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|
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Depreciation and amortization |
|
$ |
66.4 |
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$ |
25.7 |
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$ |
- |
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$ |
92.1 |
|
Purchases of property, plant and equipment |
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|
50.0 |
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|
16.4 |
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|
- |
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|
66.4 |
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For the nine months ended September 30, 2025 |
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Mineral Fiber |
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Architectural Specialties |
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Unallocated Corporate |
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Total |
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Net sales to external customers |
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$ |
786.1 |
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$ |
446.4 |
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$ |
- |
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$ |
1,232.5 |
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Cost of goods sold |
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|
460.0 |
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|
|
267.3 |
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|
1.0 |
|
|
|
728.3 |
|
Gross profit (loss) |
|
|
326.1 |
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|
|
179.1 |
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(1.0 |
) |
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|
504.2 |
|
SG&A expenses |
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|
132.3 |
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|
119.0 |
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|
0.8 |
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|
252.1 |
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Loss related to change in fair value of contingent consideration |
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|
0.2 |
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|
0.3 |
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|
- |
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|
0.5 |
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(Gain) loss on sales of fixed assets, net |
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(0.9 |
) |
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|
0.1 |
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|
- |
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(0.8 |
) |
Equity (earnings) loss from unconsolidated affiliates, net |
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(87.1 |
) |
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|
- |
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|
0.6 |
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(86.5 |
) |
Segment operating income (loss) |
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$ |
281.6 |
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|
$ |
59.7 |
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|
$ |
(2.4 |
) |
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$ |
338.9 |
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|
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Depreciation and amortization |
|
$ |
64.5 |
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$ |
25.4 |
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|
$ |
- |
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$ |
89.9 |
|
Purchases of property, plant and equipment |
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|
49.9 |
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|
|
11.7 |
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|
- |
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|
61.6 |
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During the third quarter of 2025, we sold a parcel of land at a Mineral Fiber plant for total proceeds of $1.0 million, with a $0.9 million gain recorded upon sale. The impact of the transaction was recorded within (gain) on sales of fixed assets, net on our Condensed Consolidated Statements of Earnings and Comprehensive Income. The following table reconciles our total segment operating income to earnings before income taxes. These items are only measured and managed on a consolidated basis:
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Three Months Ended |
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Nine Months Ended |
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September 30, |
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September 30, |
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2026 |
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2025 |
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|
2026 |
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|
2025 |
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Total segment operating income |
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$ |
131.2 |
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$ |
117.2 |
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$ |
359.2 |
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$ |
338.9 |
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Interest expense |
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|
7.5 |
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|
8.2 |
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|
22.6 |
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|
25.3 |
|
Other non-operating (income), net |
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(0.7 |
) |
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(0.5 |
) |
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(3.1 |
) |
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|
(1.9 |
) |
Earnings before income taxes |
|
$ |
124.4 |
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$ |
109.5 |
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$ |
339.7 |
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$ |
315.5 |
|
The following tables present balance sheet information by segment:
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As of September 30, 2026 |
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Mineral Fiber |
|
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Architectural Specialties |
|
|
Unallocated Corporate |
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Total |
|
Segment assets |
|
$ |
1,099.4 |
|
|
$ |
718.0 |
|
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$ |
187.0 |
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$ |
2,004.4 |
|
Investments in unconsolidated affiliates |
|
|
26.2 |
|
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|
- |
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3.3 |
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|
29.5 |
|
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As of December 31, 2025 |
|
Mineral Fiber |
|
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Architectural Specialties |
|
|
Unallocated Corporate |
|
|
Total |
|
Segment assets |
|
$ |
1,095.6 |
|
|
$ |
612.7 |
|
|
$ |
216.4 |
|
|
$ |
1,924.7 |
|
Investments in unconsolidated affiliates |
|
|
22.9 |
|
|
|
- |
|
|
|
3.7 |
|
|
|
26.6 |
|
|