TRINITY INDUSTRIES INCTRN

TRINITY INDUSTRIES INC Fair Value Disclosure

10-KFiled Feb 19, 20262 min read
Fair Value Measurements
Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for that asset or liability in an orderly transaction between market participants on the measurement date. An entity is required to establish a fair value hierarchy that maximizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value. The three levels of inputs that may be used to measure fair value are listed below.
Level 1 – This level is defined as quoted prices in active markets for identical assets or liabilities. Our cash equivalents and restricted cash are instruments of the U.S. Treasury or highly-rated money market mutual funds. The assets measured on a recurring basis as Level 1 in the fair value hierarchy are summarized below:
Level 1
 December 31, 2025December 31, 2024
(in millions)
Assets:
Cash equivalents$172.4 $209.6 
Restricted cash122.3 146.2 
Total assets$294.7 $355.8 
Level 2 – This level is defined as observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Interest rate hedges and interest rate derivatives are valued at exit prices obtained from each counterparty. Foreign currency hedges are valued at exit prices obtained from each counterparty, which are based on currency spot and forward rates and forward points. The assets and liabilities measured on a recurring basis as Level 2 in the fair value hierarchy are summarized below:
Level 2
 December 31, 2025December 31, 2024
(in millions)
Assets (1):
Derivatives designated as hedging instruments:
Interest rate hedges$— $10.4 
Foreign currency hedges3.6 0.4 
Derivatives not designated as hedging instruments:
Interest rate derivatives7.3 23.3 
Total assets$10.9 $34.1 
Liabilities (2):
Derivatives designated as hedging instruments:
Interest rate hedges$6.7 $— 
Foreign currency hedges— 9.5 
Derivatives not designated as hedging instruments:
Interest rate derivatives7.3 23.3 
Total liabilities$14.0 $32.8 
(1) Included in other assets in our Consolidated Balance Sheets.
(2) Included in accrued liabilities in our Consolidated Balance Sheets.
Level 3 – This level is defined as unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. As of December 31, 2025 and 2024, we have no assets or liabilities measured on a recurring basis as Level 3 in the fair value hierarchy.
See Note 9 for the estimated fair values of our debt instruments. The fair values of all other financial instruments are estimated to approximate carrying value.

Historical Timeline

Fiscal YearFiled
2025Feb 19, 2026Showing above
2024Feb 20, 2025
2023Feb 22, 2024
2022Feb 21, 2023
2021Feb 17, 2022
2020Feb 24, 2021
2019Feb 20, 2020
2018Feb 21, 2019
2017Feb 22, 2018
2016Feb 17, 2017
2015Feb 19, 2016

About Fair Value Disclosures

Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.

Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.

Other Available Disclosures

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