|
British Columbia, Canada
|
|
98-0377314
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
Securities registered pursuant to Section 12(b) of the Act:
|
||
Common Stock (no par value)
|
DOOR
|
New York Stock Exchange
|
(Title of class)
|
(Trading symbol)
|
(Name of exchange on which registered)
|
Large accelerated filer
|
|
☑
|
|
Accelerated filer
|
|
☐
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|
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|
|||
Non-accelerated filer
|
|
☐
|
|
Smaller reporting company
|
|
☐
|
|
|
|
|
|||
Emerging growth company
|
|
☐
|
|
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|
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PART I
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|
|
Page
|
Item 1
|
|
|
|
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||
|
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||
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||
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Item 2
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Item 3
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Item 4
|
|
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PART II
|
|
|
|
Item 1
|
|
||
Item 1A
|
|
||
Item 2
|
|
||
Item 3
|
|
||
Item 4
|
|
||
Item 5
|
|
||
Item 6
|
|
•
|
downward trends in our end markets and in economic conditions;
|
•
|
reduced levels of residential new construction; residential repair, renovation and remodeling; and non-residential building construction activity due to increases in mortgage rates, changes in mortgage interest deductions and related tax changes and reduced availability of financing;
|
•
|
competition;
|
•
|
the continued success of, and our ability to maintain relationships with, certain key customers in light of customer concentration and consolidation;
|
•
|
new tariffs and evolving trade policy between the United States and other countries, including China;
|
•
|
increases in prices of raw materials and fuel;
|
•
|
increases in labor costs, the availability of labor, or labor relations (i.e., disruptions, strikes or work stoppages);
|
•
|
our ability to manage our operations including anticipating demand for our products, managing disruptions in our operations, managing manufacturing realignments (including related restructuring charges), managing customer credit risk and successful integration of acquisitions;
|
•
|
the continuous operation of our information technology and enterprise resource planning systems and management of potential cyber security threats and attacks;
|
•
|
our ability to generate sufficient cash flows to fund our capital expenditure requirements, to meet our pension obligations, and to meet our debt service obligations, including our obligations under our senior notes and our ABL Facility;
|
•
|
political, economic and other risks that arise from operating a multinational business;
|
•
|
uncertainty relating to the United Kingdom's anticipated exit from the European Union;
|
•
|
fluctuating exchange and interest rates;
|
•
|
our ability to innovate and keep pace with technological developments;
|
•
|
product liability claims and product recalls;
|
•
|
retention of key management personnel;
|
•
|
environmental and other government regulations, including the FCPA, and any changes in such regulations; and
|
•
|
limitations on operating our business as a result of covenant restrictions under our existing and future indebtedness, including our senior notes and our ABL Facility.
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
2019 |
|
July 1,
2018 |
|
June 30,
2019 |
|
July 1,
2018 |
||||||||
Net sales
|
$
|
562,943
|
|
|
$
|
566,726
|
|
|
$
|
1,093,254
|
|
|
$
|
1,084,605
|
|
Cost of goods sold
|
434,013
|
|
|
443,052
|
|
|
852,220
|
|
|
855,502
|
|
||||
Gross profit
|
128,930
|
|
|
123,674
|
|
|
241,034
|
|
|
229,103
|
|
||||
Selling, general and administration expenses
|
78,142
|
|
|
71,851
|
|
|
156,242
|
|
|
140,062
|
|
||||
Restructuring costs
|
1,361
|
|
|
—
|
|
|
5,101
|
|
|
—
|
|
||||
Asset impairment
|
3,142
|
|
|
—
|
|
|
13,767
|
|
|
—
|
|
||||
Loss on disposal of subsidiaries
|
—
|
|
|
—
|
|
|
4,605
|
|
|
—
|
|
||||
Operating income
|
46,285
|
|
|
51,823
|
|
|
61,319
|
|
|
89,041
|
|
||||
Interest expense, net
|
11,357
|
|
|
9,074
|
|
|
22,484
|
|
|
17,830
|
|
||||
Other income, net of expense
|
(456
|
)
|
|
(839
|
)
|
|
(1,586
|
)
|
|
(861
|
)
|
||||
Income before income tax expense
|
35,384
|
|
|
43,588
|
|
|
40,421
|
|
|
72,072
|
|
||||
Income tax expense
|
10,293
|
|
|
7,894
|
|
|
10,351
|
|
|
14,595
|
|
||||
Net income
|
25,091
|
|
|
35,694
|
|
|
30,070
|
|
|
57,477
|
|
||||
Less: net income attributable to non-controlling interests
|
849
|
|
|
953
|
|
|
2,039
|
|
|
1,910
|
|
||||
Net income attributable to Masonite
|
$
|
24,242
|
|
|
$
|
34,741
|
|
|
$
|
28,031
|
|
|
$
|
55,567
|
|
|
|
|
|
|
|
|
|
||||||||
Basic earnings per common share attributable to Masonite
|
$
|
0.96
|
|
|
$
|
1.26
|
|
|
$
|
1.11
|
|
|
$
|
1.99
|
|
Diluted earnings per common share attributable to Masonite
|
$
|
0.96
|
|
|
$
|
1.24
|
|
|
$
|
1.09
|
|
|
$
|
1.96
|
|
|
|
|
|
|
|
|
|
||||||||
Comprehensive income:
|
|
|
|
|
|
|
|
||||||||
Net income
|
$
|
25,091
|
|
|
$
|
35,694
|
|
|
$
|
30,070
|
|
|
$
|
57,477
|
|
Other comprehensive income:
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation gain (loss)
|
(5,178
|
)
|
|
(31,445
|
)
|
|
8,813
|
|
|
(25,671
|
)
|
||||
Amortization of actuarial net losses
|
403
|
|
|
299
|
|
|
807
|
|
|
599
|
|
||||
Income tax expense related to other comprehensive income
|
(92
|
)
|
|
(100
|
)
|
|
(185
|
)
|
|
(200
|
)
|
||||
Other comprehensive income (loss), net of tax:
|
(4,867
|
)
|
|
(31,246
|
)
|
|
9,435
|
|
|
(25,272
|
)
|
||||
Comprehensive income
|
20,224
|
|
|
4,448
|
|
|
39,505
|
|
|
32,205
|
|
||||
Less: comprehensive income attributable to non-controlling interests
|
981
|
|
|
584
|
|
|
2,387
|
|
|
1,298
|
|
||||
Comprehensive income attributable to Masonite
|
$
|
19,243
|
|
|
$
|
3,864
|
|
|
$
|
37,118
|
|
|
$
|
30,907
|
|
ASSETS
|
June 30,
2019 |
|
December 30,
2018 |
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
112,644
|
|
|
$
|
115,656
|
|
Restricted cash
|
10,644
|
|
|
10,485
|
|
||
Accounts receivable, net
|
308,236
|
|
|
283,580
|
|
||
Inventories, net
|
254,625
|
|
|
250,407
|
|
||
Prepaid expenses
|
33,233
|
|
|
32,970
|
|
||
Income taxes receivable
|
3,590
|
|
|
3,495
|
|
||
Total current assets
|
722,972
|
|
|
696,593
|
|
||
Property, plant and equipment, net
|
594,538
|
|
|
609,753
|
|
||
Operating lease right-of-use assets
|
143,613
|
|
|
—
|
|
||
Investment in equity investees
|
14,991
|
|
|
13,474
|
|
||
Goodwill
|
180,865
|
|
|
180,297
|
|
||
Intangible assets, net
|
199,597
|
|
|
212,045
|
|
||
Deferred income taxes
|
28,558
|
|
|
28,509
|
|
||
Other assets
|
40,664
|
|
|
37,794
|
|
||
Total assets
|
$
|
1,925,798
|
|
|
$
|
1,778,465
|
|
|
|
|
|
||||
LIABILITIES AND EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
101,920
|
|
|
$
|
96,362
|
|
Accrued expenses
|
172,175
|
|
|
147,345
|
|
||
Income taxes payable
|
1,642
|
|
|
1,599
|
|
||
Total current liabilities
|
275,737
|
|
|
245,306
|
|
||
Long-term debt
|
796,711
|
|
|
796,398
|
|
||
Long-term operating lease liabilities
|
132,949
|
|
|
—
|
|
||
Deferred income taxes
|
82,924
|
|
|
82,122
|
|
||
Other liabilities
|
22,906
|
|
|
32,334
|
|
||
Total liabilities
|
1,311,227
|
|
|
1,156,160
|
|
||
Commitments and Contingencies (Note 10)
|
|
|
|
|
|
||
Equity:
|
|
|
|
||||
Share capital: unlimited shares authorized, no par value, 25,019,940 and 25,835,664 shares issued and outstanding as of June 30, 2019, and December 30, 2018, respectively
|
561,543
|
|
|
575,207
|
|
||
Additional paid-in capital
|
215,418
|
|
|
218,988
|
|
||
Accumulated deficit
|
(30,225
|
)
|
|
(30,836
|
)
|
||
Accumulated other comprehensive loss
|
(143,832
|
)
|
|
(152,919
|
)
|
||
Total equity attributable to Masonite
|
602,904
|
|
|
610,440
|
|
||
Equity attributable to non-controlling interests
|
11,667
|
|
|
11,865
|
|
||
Total equity
|
614,571
|
|
|
622,305
|
|
||
Total liabilities and equity
|
$
|
1,925,798
|
|
|
$
|
1,778,465
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30, 2019
|
|
July 1, 2018
|
|
June 30, 2019
|
|
July 1, 2018
|
||||||||
Total equity, beginning of period
|
$
|
610,370
|
|
|
$
|
719,573
|
|
|
$
|
622,305
|
|
|
$
|
735,902
|
|
Share capital:
|
|
|
|
|
|
|
|
||||||||
Beginning of period
|
567,490
|
|
|
619,554
|
|
|
575,207
|
|
|
624,403
|
|
||||
Common shares issued for delivery of share based awards
|
931
|
|
|
834
|
|
|
7,083
|
|
|
10,698
|
|
||||
Common shares issued under employee stock purchase plan
|
—
|
|
|
(17
|
)
|
|
517
|
|
|
499
|
|
||||
Common shares repurchased and retired
|
(6,878
|
)
|
|
(6,000
|
)
|
|
(21,264
|
)
|
|
(21,229
|
)
|
||||
End of period
|
561,543
|
|
|
614,371
|
|
|
561,543
|
|
|
614,371
|
|
||||
Additional paid-in capital:
|
|
|
|
|
|
|
|
||||||||
Beginning of period
|
214,294
|
|
|
217,228
|
|
|
218,988
|
|
|
226,528
|
|
||||
Share based compensation expense
|
2,093
|
|
|
3,538
|
|
|
4,773
|
|
|
6,603
|
|
||||
Common shares issued for delivery of share based awards
|
(931
|
)
|
|
(834
|
)
|
|
(7,083
|
)
|
|
(10,698
|
)
|
||||
Common shares withheld to cover income taxes payable due to delivery of share based awards
|
(38
|
)
|
|
(1
|
)
|
|
(1,128
|
)
|
|
(2,423
|
)
|
||||
Common shares issued under employee stock purchase plan
|
—
|
|
|
—
|
|
|
(132
|
)
|
|
(79
|
)
|
||||
End of period
|
215,418
|
|
|
219,931
|
|
|
215,418
|
|
|
219,931
|
|
||||
Accumulated deficit:
|
|
|
|
|
|
|
|
||||||||
Beginning of period
|
(45,852
|
)
|
|
(26,286
|
)
|
|
(30,836
|
)
|
|
(18,150
|
)
|
||||
Net income attributable to Masonite
|
24,242
|
|
|
34,741
|
|
|
28,031
|
|
|
55,567
|
|
||||
Common shares repurchased and retired
|
(8,615
|
)
|
|
(10,478
|
)
|
|
(27,420
|
)
|
|
(39,440
|
)
|
||||
End of period
|
(30,225
|
)
|
|
(2,023
|
)
|
|
(30,225
|
)
|
|
(2,023
|
)
|
||||
Accumulated other comprehensive loss:
|
|
|
|
|
|
|
|
||||||||
Beginning of period
|
(138,833
|
)
|
|
(103,935
|
)
|
|
(152,919
|
)
|
|
(110,152
|
)
|
||||
Other comprehensive income attributable to Masonite, net of tax
|
(4,999
|
)
|
|
(30,877
|
)
|
|
9,087
|
|
|
(24,660
|
)
|
||||
End of period
|
(143,832
|
)
|
|
(134,812
|
)
|
|
(143,832
|
)
|
|
(134,812
|
)
|
||||
Equity attributable to non-controlling interests:
|
|
|
|
|
|
|
|
||||||||
Beginning of period
|
13,271
|
|
|
13,012
|
|
|
11,865
|
|
|
13,273
|
|
||||
Net income attributable to non-controlling interests
|
849
|
|
|
953
|
|
|
2,039
|
|
|
1,910
|
|
||||
Other comprehensive income (loss) attributable to non-controlling interests, net of tax
|
132
|
|
|
(369
|
)
|
|
348
|
|
|
(612
|
)
|
||||
Dividends to non-controlling interests
|
(2,585
|
)
|
|
(1,548
|
)
|
|
(2,585
|
)
|
|
(2,523
|
)
|
||||
End of period
|
11,667
|
|
|
12,048
|
|
|
11,667
|
|
|
12,048
|
|
||||
Total equity, end of period
|
$
|
614,571
|
|
|
$
|
709,515
|
|
|
$
|
614,571
|
|
|
$
|
709,515
|
|
|
|
|
|
|
|
|
|
||||||||
Common shares outstanding:
|
|
|
|
|
|
|
|
||||||||
Beginning of period
|
25,314,850
|
|
|
27,851,728
|
|
|
25,835,664
|
|
|
28,369,877
|
|
||||
Common shares issued for delivery of share based awards
|
12,876
|
|
|
15,149
|
|
|
129,128
|
|
|
181,397
|
|
||||
Common shares issued under employee stock purchase plan
|
—
|
|
|
—
|
|
|
9,036
|
|
|
7,386
|
|
||||
Common shares repurchased and retired
|
(307,786
|
)
|
|
(269,751
|
)
|
|
(953,888
|
)
|
|
(961,534
|
)
|
||||
End of period
|
25,019,940
|
|
|
27,597,126
|
|
|
25,019,940
|
|
|
27,597,126
|
|
|
Six Months Ended
|
||||||
Cash flows from operating activities:
|
June 30,
2019 |
|
July 1,
2018 |
||||
Net income
|
$
|
30,070
|
|
|
$
|
57,477
|
|
Adjustments to reconcile net income to net cash flow provided by operating activities:
|
|
|
|
||||
Loss on disposal of subsidiaries
|
4,605
|
|
|
—
|
|
||
Depreciation
|
36,486
|
|
|
27,634
|
|
||
Amortization
|
14,926
|
|
|
13,910
|
|
||
Share based compensation expense
|
4,773
|
|
|
6,603
|
|
||
Deferred income taxes
|
1,367
|
|
|
7,234
|
|
||
Unrealized foreign exchange loss (gain)
|
316
|
|
|
(2,079
|
)
|
||
Share of income from equity investees, net of tax
|
(1,517
|
)
|
|
(781
|
)
|
||
Pension and post-retirement funding, net of expense
|
(3,225
|
)
|
|
(3,302
|
)
|
||
Non-cash accruals and interest
|
(664
|
)
|
|
457
|
|
||
Loss on sale of property, plant and equipment
|
4,235
|
|
|
2,512
|
|
||
Asset impairment
|
13,767
|
|
|
—
|
|
||
Changes in assets and liabilities, net of acquisitions:
|
|
|
|
||||
Accounts receivable
|
(20,609
|
)
|
|
(39,982
|
)
|
||
Inventories
|
(5,165
|
)
|
|
(2,799
|
)
|
||
Prepaid expenses
|
(316
|
)
|
|
(1,941
|
)
|
||
Accounts payable and accrued expenses
|
10,571
|
|
|
27,623
|
|
||
Other assets and liabilities
|
(1,407
|
)
|
|
(4,589
|
)
|
||
Net cash flow provided by operating activities
|
88,213
|
|
|
87,977
|
|
||
Cash flows from investing activities:
|
|
|
|
||||
Additions to property, plant and equipment
|
(37,923
|
)
|
|
(33,835
|
)
|
||
Cash used in acquisitions, net of cash acquired
|
(219
|
)
|
|
(135,600
|
)
|
||
Cash disposed in sale of subsidiaries, net of cash proceeds
|
(230
|
)
|
|
—
|
|
||
Proceeds from sale of property, plant and equipment
|
90
|
|
|
1,367
|
|
||
Other investing activities
|
(955
|
)
|
|
(1,825
|
)
|
||
Net cash flow used in investing activities
|
(39,237
|
)
|
|
(169,893
|
)
|
||
Cash flows from financing activities:
|
|
|
|
||||
Repayments of long-term debt
|
(61
|
)
|
|
(196
|
)
|
||
Tax withholding on share based awards
|
(1,128
|
)
|
|
(2,423
|
)
|
||
Distributions to non-controlling interests
|
(2,585
|
)
|
|
(2,523
|
)
|
||
Repurchases of common shares
|
(48,684
|
)
|
|
(60,669
|
)
|
||
Net cash flow used in financing activities
|
(52,458
|
)
|
|
(65,811
|
)
|
||
Net foreign currency translation adjustment on cash
|
629
|
|
|
(201
|
)
|
||
Decrease in cash, cash equivalents and restricted cash
|
(2,853
|
)
|
|
(147,928
|
)
|
||
Cash, cash equivalents and restricted cash, beginning of period
|
126,141
|
|
|
188,564
|
|
||
Cash, cash equivalents and restricted cash, at end of period
|
$
|
123,288
|
|
|
$
|
40,636
|
|
(In thousands)
|
BWI
|
|
Graham & Maiman
|
|
DW3
|
|
Total 2018 Acquisitions
|
||||||||
Accounts receivable
|
$
|
9,215
|
|
|
$
|
—
|
|
|
$
|
8,590
|
|
|
$
|
17,805
|
|
Inventory
|
10,736
|
|
|
6,090
|
|
|
5,059
|
|
|
21,885
|
|
||||
Property, plant and equipment
|
2,222
|
|
|
19,557
|
|
|
8,196
|
|
|
29,975
|
|
||||
Goodwill
|
3,739
|
|
|
10,996
|
|
|
33,623
|
|
|
48,358
|
|
||||
Intangible assets
|
2,970
|
|
|
2,750
|
|
|
62,873
|
|
|
68,593
|
|
||||
Accounts payable and accrued expenses
|
(6,816
|
)
|
|
(426
|
)
|
|
(10,418
|
)
|
|
(17,660
|
)
|
||||
Deferred income taxes
|
—
|
|
|
—
|
|
|
(11,546
|
)
|
|
(11,546
|
)
|
||||
Other assets and liabilities, net
|
240
|
|
|
—
|
|
|
(68
|
)
|
|
172
|
|
||||
Cash consideration, net of cash acquired
|
$
|
22,306
|
|
|
$
|
38,967
|
|
|
$
|
96,309
|
|
|
$
|
157,582
|
|
(In thousands)
|
BWI
|
|
Expected Useful Life (Years)
|
|
Graham & Maiman
|
|
Expected Useful Life (Years)
|
|
DW3
|
|
Expected Useful Life (Years)
|
||||||
Customer relationships
|
$
|
1,200
|
|
|
10.0
|
|
$
|
2,400
|
|
|
10.0
|
|
$
|
49,554
|
|
|
10.0
|
Trademarks and trade names
|
900
|
|
|
10.0
|
|
350
|
|
|
1.5
|
|
11,785
|
|
|
10.0
|
|||
Patents
|
—
|
|
|
|
|
—
|
|
|
|
|
1,420
|
|
|
10.0
|
|||
Other
|
870
|
|
|
2.2
|
|
—
|
|
|
|
|
114
|
|
|
3.0
|
|||
Total intangible assets acquired
|
$
|
2,970
|
|
|
|
|
$
|
2,750
|
|
|
|
|
$
|
62,873
|
|
|
|
|
Three Months Ended June 30, 2019
|
||||||||||||||
(In thousands)
|
BWI
|
|
Graham & Maiman
|
|
DW3
|
|
Total 2018 Acquisitions
|
||||||||
Net sales
|
$
|
24,515
|
|
|
$
|
19,291
|
|
|
$
|
19,567
|
|
|
$
|
63,373
|
|
Net income attributable to Masonite
|
649
|
|
|
960
|
|
|
2,609
|
|
|
4,218
|
|
|
Six Months Ended June 30, 2019
|
||||||||||||||
(In thousands)
|
BWI
|
|
Graham & Maiman
|
|
DW3
|
|
Total 2018 Acquisitions
|
||||||||
Net sales
|
$
|
46,458
|
|
|
$
|
35,947
|
|
|
$
|
39,229
|
|
|
$
|
121,634
|
|
Net income attributable to Masonite
|
727
|
|
|
1,180
|
|
|
5,466
|
|
|
7,373
|
|
|
Three Months Ended July 1, 2018
|
||||||||||
(in thousands)
|
Graham & Maiman
|
|
DW3
|
|
Total 2018 Acquisitions
|
||||||
Net sales
|
$
|
6,266
|
|
|
$
|
18,351
|
|
|
$
|
24,617
|
|
Net income attributable to Masonite
|
302
|
|
|
1,145
|
|
|
1,447
|
|
|
Six Months Ended July 1, 2018
|
||||||||||
(in thousands)
|
Graham & Maiman
|
|
DW3
|
|
Total 2018 Acquisitions
|
||||||
Net sales
|
$
|
6,266
|
|
|
$
|
29,549
|
|
|
$
|
35,815
|
|
Net income attributable to Masonite
|
302
|
|
|
2,093
|
|
|
2,395
|
|
|
Three Months Ended July 1, 2018
|
|||||||||||||||||
(In thousands, except per share amounts)
|
Masonite
|
|
BWI
|
|
Graham & Maiman
|
|
Intercompany Eliminations
|
|
Pro Forma
|
|||||||||
Net sales
|
$
|
566,726
|
|
|
24,513
|
|
|
$
|
11,288
|
|
|
$
|
(11,777
|
)
|
|
$
|
590,750
|
|
Net income attributable to Masonite
|
34,741
|
|
|
139
|
|
|
(114
|
)
|
|
—
|
|
|
34,766
|
|
||||
|
|
|
|
|
|
|
|
|
|
|||||||||
Basic earnings per common share
|
$
|
1.26
|
|
|
|
|
|
|
|
|
$
|
1.26
|
|
|||||
Diluted earnings per common share
|
1.24
|
|
|
|
|
|
|
|
|
1.24
|
|
|
Six Months Ended July 1, 2018
|
||||||||||||||||||||||
(In thousands, except per share amounts)
|
Masonite
|
|
BWI
|
|
Graham & Maiman
|
|
DW3
|
|
Intercompany Eliminations
|
|
Pro Forma
|
||||||||||||
Net sales
|
$
|
1,084,605
|
|
|
$
|
47,573
|
|
|
$
|
26,887
|
|
|
$
|
4,918
|
|
|
$
|
(22,886
|
)
|
|
$
|
1,141,097
|
|
Net income attributable to Masonite
|
55,567
|
|
|
269
|
|
|
89
|
|
|
81
|
|
|
|
|
56,006
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Basic earnings per common share
|
$
|
1.99
|
|
|
|
|
|
|
|
|
|
|
$
|
2.01
|
|
||||||||
Diluted earnings per common share
|
1.96
|
|
|
|
|
|
|
|
|
|
|
1.97
|
|
(In thousands)
|
June 30,
2019 |
|
December 30,
2018 |
||||
Raw materials
|
$
|
183,240
|
|
|
$
|
189,145
|
|
Finished goods
|
80,577
|
|
|
69,026
|
|
||
Provision for obsolete or aged inventory
|
(9,192
|
)
|
|
(7,764
|
)
|
||
Inventories, net
|
$
|
254,625
|
|
|
$
|
250,407
|
|
(In thousands)
|
June 30,
2019 |
|
December 30,
2018 |
||||
Land
|
$
|
29,738
|
|
|
$
|
30,653
|
|
Buildings
|
179,313
|
|
|
179,888
|
|
||
Machinery and equipment
|
726,142
|
|
|
724,431
|
|
||
Property, plant and equipment, gross
|
935,193
|
|
|
934,972
|
|
||
Accumulated depreciation
|
(340,655
|
)
|
|
(325,219
|
)
|
||
Property, plant and equipment, net
|
$
|
594,538
|
|
|
$
|
609,753
|
|
(In thousands)
|
June 30, 2019
|
||
Operating lease right-of-use assets
|
$
|
143,613
|
|
|
|
||
Current portion of operating lease liabilities
|
21,271
|
|
|
Long-term operating lease liabilities
|
132,949
|
|
|
Total operating lease liabilities
|
$
|
154,220
|
|
|
|
||
Weighted average remaining lease term (years)
|
14.8
|
|
|
Weighted average discount rate
|
4.9
|
%
|
(In thousands)
|
June 30, 2019
|
||
Fiscal year:
|
|
||
2019 (remaining six months)
|
$
|
13,785
|
|
2020
|
27,180
|
|
|
2021
|
19,123
|
|
|
2022
|
15,427
|
|
|
2023
|
12,595
|
|
|
Thereafter
|
148,522
|
|
|
Total undiscounted lease payments
|
236,632
|
|
|
Less imputed interest
|
(82,412
|
)
|
|
Total
|
$
|
154,220
|
|
(In thousands)
|
North American Residential
|
|
Europe
|
|
Architectural
|
|
Total
|
||||||||
December 30, 2018
|
$
|
6,189
|
|
|
$
|
63,220
|
|
|
$
|
110,888
|
|
|
$
|
180,297
|
|
Measurement period adjustment
|
390
|
|
|
—
|
|
|
—
|
|
|
390
|
|
||||
Foreign exchange fluctuations
|
11
|
|
|
55
|
|
|
112
|
|
|
178
|
|
||||
June 30, 2019
|
$
|
6,590
|
|
|
$
|
63,275
|
|
|
$
|
111,000
|
|
|
$
|
180,865
|
|
|
June 30, 2019
|
|
December 30, 2018
|
||||||||||||||||||||
(In thousands)
|
Cost
|
|
Accumulated Amortization
|
|
Net Book Value
|
|
Cost
|
|
Accumulated Amortization
|
|
Net Book Value
|
||||||||||||
Definite life intangible assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Customer relationships
|
$
|
173,782
|
|
|
$
|
(90,916
|
)
|
|
$
|
82,866
|
|
|
$
|
173,637
|
|
|
$
|
(81,220
|
)
|
|
$
|
92,417
|
|
Patents
|
31,934
|
|
|
(22,978
|
)
|
|
8,956
|
|
|
31,363
|
|
|
(21,840
|
)
|
|
9,523
|
|
||||||
Software
|
33,358
|
|
|
(30,954
|
)
|
|
2,404
|
|
|
32,660
|
|
|
(29,296
|
)
|
|
3,364
|
|
||||||
Trademarks and tradenames
|
33,811
|
|
|
(5,694
|
)
|
|
28,117
|
|
|
33,784
|
|
|
(3,948
|
)
|
|
29,836
|
|
||||||
Other
|
972
|
|
|
(315
|
)
|
|
657
|
|
|
971
|
|
|
(97
|
)
|
|
874
|
|
||||||
Total definite life intangible assets
|
273,857
|
|
|
(150,857
|
)
|
|
123,000
|
|
|
272,415
|
|
|
(136,401
|
)
|
|
136,014
|
|
||||||
Indefinite life intangible assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Trademarks and tradenames
|
76,597
|
|
|
—
|
|
|
76,597
|
|
|
76,031
|
|
|
—
|
|
|
76,031
|
|
||||||
Total intangible assets
|
$
|
350,454
|
|
|
$
|
(150,857
|
)
|
|
$
|
199,597
|
|
|
$
|
348,446
|
|
|
$
|
(136,401
|
)
|
|
$
|
212,045
|
|
(In thousands)
|
June 30, 2019
|
|
|
Fiscal year:
|
|
||
2019 (remaining six months)
|
$
|
13,974
|
|
2020
|
22,392
|
|
|
2021
|
18,792
|
|
|
2022
|
15,345
|
|
|
2023
|
13,859
|
|
(In thousands)
|
June 30,
2019 |
|
December 30,
2018 |
||||
Accrued payroll
|
$
|
46,886
|
|
|
$
|
39,823
|
|
Accrued rebates
|
35,071
|
|
|
36,711
|
|
||
Current portion of operating lease liabilities
|
21,271
|
|
|
—
|
|
||
Accrued interest
|
13,667
|
|
|
14,570
|
|
||
Other accruals
|
55,280
|
|
|
56,241
|
|
||
Total accrued expenses
|
$
|
172,175
|
|
|
$
|
147,345
|
|
(In thousands)
|
June 30,
2019 |
|
December 30,
2018 |
||||
5.625% senior unsecured notes due 2023
|
$
|
500,000
|
|
|
$
|
500,000
|
|
5.75% senior unsecured notes due 2026
|
300,000
|
|
|
300,000
|
|
||
Unamortized premium on 2023 Notes
|
3,245
|
|
|
3,684
|
|
||
Debt issuance costs
|
(7,623
|
)
|
|
(8,394
|
)
|
||
Other long-term debt
|
1,089
|
|
|
1,108
|
|
||
Total long-term debt
|
$
|
796,711
|
|
|
$
|
796,398
|
|
Six Months Ended June 30, 2019
|
Stock Appreciation Rights
|
|
Aggregate Intrinsic Value (in thousands)
|
|
Weighted Average Exercise Price
|
|
Average Remaining Contractual Life (Years)
|
|||||
Outstanding, beginning of period
|
514,313
|
|
|
$
|
7,254
|
|
|
$
|
39.01
|
|
|
4.6
|
Granted
|
111,230
|
|
|
|
|
57.29
|
|
|
|
|||
Exercised
|
(32,088
|
)
|
|
1,150
|
|
|
18.73
|
|
|
|
||
Forfeited
|
(8,329
|
)
|
|
|
|
67.24
|
|
|
|
|||
Outstanding, end of period
|
585,126
|
|
|
$
|
8,386
|
|
|
$
|
43.20
|
|
|
4.2
|
|
|
|
|
|
|
|
|
|||||
Exercisable, end of period
|
411,119
|
|
|
$
|
8,386
|
|
|
$
|
35.59
|
|
|
2.1
|
|
2019 Grants
|
||
SAR value (model conclusion)
|
$
|
12.26
|
|
Risk-free rate
|
2.2
|
%
|
|
Expected dividend yield
|
0.0
|
%
|
|
Expected volatility
|
21.9
|
%
|
|
Expected term (years)
|
6.0
|
|
|
Six Months Ended
|
|||||
|
June 30, 2019
|
|||||
|
Total Restricted Stock Units Outstanding
|
|
Weighted Average Grant Date Fair Value
|
|||
Outstanding, beginning of period
|
429,027
|
|
|
$
|
66.03
|
|
Granted
|
289,945
|
|
|
56.16
|
|
|
Performance adjustment (1)
|
(21,953
|
)
|
|
57.51
|
|
|
Delivered
|
(112,709
|
)
|
|
|
||
Withheld to cover (2)
|
(19,061
|
)
|
|
|
||
Forfeited
|
(15,931
|
)
|
|
|
||
Outstanding, end of period
|
549,318
|
|
|
$
|
59.86
|
|
(2)
|
A portion of the vested RSUs delivered were net share settled to cover statutory requirements for income and other employment taxes. We remit the equivalent cash to the appropriate taxing authorities. These net share settlements had the effect of share repurchases by us as we reduced and retired the number of shares that would have otherwise been issued as a result of the vesting.
|
|
Three Months Ended June 30, 2019
|
||||||||||||||||||
(In thousands)
|
North American Residential
|
|
Europe
|
|
Architectural
|
|
Corporate & Other
|
|
Total
|
||||||||||
2019 Plan
|
$
|
945
|
|
|
$
|
5
|
|
|
$
|
(118
|
)
|
|
$
|
65
|
|
|
$
|
897
|
|
2018 Plan
|
368
|
|
|
96
|
|
|
—
|
|
|
—
|
|
|
464
|
|
|||||
Total Restructuring Costs
|
$
|
1,313
|
|
|
$
|
101
|
|
|
$
|
(118
|
)
|
|
$
|
65
|
|
|
$
|
1,361
|
|
|
Six Months Ended June 30, 2019
|
||||||||||||||||||
(In thousands)
|
North American Residential
|
|
Europe
|
|
Architectural
|
|
Corporate & Other
|
|
Total
|
||||||||||
2019 Plan
|
$
|
2,404
|
|
|
$
|
336
|
|
|
$
|
486
|
|
|
$
|
459
|
|
|
$
|
3,685
|
|
2018 Plan
|
789
|
|
|
627
|
|
|
—
|
|
|
—
|
|
|
1,416
|
|
|||||
Total Restructuring Costs
|
$
|
3,193
|
|
|
$
|
963
|
|
|
$
|
486
|
|
|
$
|
459
|
|
|
$
|
5,101
|
|
|
Cumulative Amount Incurred Through June 30, 2019
|
||||||||||||||||||
(In thousands)
|
North American Residential
|
|
Europe
|
|
Architectural
|
|
Corporate & Other
|
|
Total
|
||||||||||
2019 Plan
|
$
|
2,404
|
|
|
$
|
336
|
|
|
$
|
486
|
|
|
$
|
459
|
|
|
$
|
3,685
|
|
2018 Plan
|
1,064
|
|
|
1,976
|
|
|
—
|
|
|
—
|
|
|
3,040
|
|
|||||
2016 Plan
|
—
|
|
|
—
|
|
|
3,707
|
|
|
—
|
|
|
3,707
|
|
|||||
2014 Plan
|
—
|
|
|
—
|
|
|
—
|
|
|
7,993
|
|
|
7,993
|
|
|||||
Total Restructuring Costs
|
$
|
3,468
|
|
|
$
|
2,312
|
|
|
$
|
4,193
|
|
|
$
|
8,452
|
|
|
$
|
18,425
|
|
(In thousands)
|
December 30,
2018 |
|
Severance
|
|
Closure Costs
|
|
Cash Payments
|
|
June 30,
2019 |
||||||||||
2019 Plan
|
$
|
—
|
|
|
$
|
3,061
|
|
|
$
|
624
|
|
|
$
|
(2,664
|
)
|
|
$
|
1,021
|
|
2018 Plan
|
596
|
|
|
1,317
|
|
|
99
|
|
|
(1,801
|
)
|
|
211
|
|
|||||
Other
|
58
|
|
|
—
|
|
|
—
|
|
|
(39
|
)
|
|
19
|
|
|||||
Total
|
$
|
654
|
|
|
$
|
4,378
|
|
|
$
|
723
|
|
|
$
|
(4,504
|
)
|
|
$
|
1,251
|
|
(In thousands)
|
December 31,
2017 |
|
Cash Payments
|
|
July 1,
2018 |
||||||
2016 Plan
|
$
|
90
|
|
|
$
|
(90
|
)
|
|
$
|
—
|
|
Other
|
194
|
|
|
(70
|
)
|
|
124
|
|
|||
Total
|
$
|
284
|
|
|
$
|
(160
|
)
|
|
$
|
124
|
|
(In thousands, except share and per share information)
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
June 30, 2019
|
|
July 1, 2018
|
|
June 30, 2019
|
|
July 1, 2018
|
|||||||||
Net income attributable to Masonite
|
$
|
24,242
|
|
|
$
|
34,741
|
|
|
$
|
28,031
|
|
|
$
|
55,567
|
|
|
|
|
|
|
|
|
|
||||||||
Shares used in computing basic earnings per share
|
25,126,065
|
|
|
27,609,132
|
|
|
25,350,488
|
|
|
27,899,461
|
|
||||
Effect of dilutive securities:
|
|
|
|
|
|
|
|
||||||||
Incremental shares issuable under share compensation plans
|
250,553
|
|
|
420,454
|
|
|
295,035
|
|
|
502,753
|
|
||||
Shares used in computing diluted earnings per share
|
25,376,618
|
|
|
28,029,586
|
|
|
25,645,523
|
|
|
28,402,214
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Basic earnings per common share attributable to Masonite
|
$
|
0.96
|
|
|
$
|
1.26
|
|
|
$
|
1.11
|
|
|
$
|
1.99
|
|
Diluted earnings per common share attributable to Masonite
|
$
|
0.96
|
|
|
$
|
1.24
|
|
|
$
|
1.09
|
|
|
$
|
1.96
|
|
|
|
|
|
|
|
|
|
||||||||
Anti-dilutive instruments excluded from diluted earnings per common share:
|
|
|
|
|
|
|
|
||||||||
Stock appreciation rights
|
292,295
|
|
|
51,129
|
|
|
292,295
|
|
|
51,129
|
|
||||
Restricted stock units
|
62,847
|
|
|
—
|
|
|
63,407
|
|
|
—
|
|
|
Three Months Ended June 30, 2019
|
||||||||||||||||||
(In thousands)
|
North American Residential
|
|
Europe
|
|
Architectural
|
|
Corporate & Other
|
|
Total
|
||||||||||
Net sales
|
$
|
380,505
|
|
|
$
|
81,361
|
|
|
$
|
101,146
|
|
|
$
|
5,199
|
|
|
$
|
568,211
|
|
Intersegment sales
|
(895
|
)
|
|
(408
|
)
|
|
(3,965
|
)
|
|
—
|
|
|
(5,268
|
)
|
|||||
Net sales to external customers
|
$
|
379,610
|
|
|
$
|
80,953
|
|
|
$
|
97,181
|
|
|
$
|
5,199
|
|
|
$
|
562,943
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted EBITDA
|
$
|
63,401
|
|
|
$
|
13,408
|
|
|
$
|
12,778
|
|
|
$
|
(9,854
|
)
|
|
$
|
79,733
|
|
|
Three Months Ended July 1, 2018
|
||||||||||||||||||
(In thousands)
|
North American Residential
|
|
Europe
|
|
Architectural
|
|
Corporate & Other
|
|
Total
|
||||||||||
Net sales
|
$
|
378,936
|
|
|
$
|
101,389
|
|
|
$
|
86,552
|
|
|
$
|
6,317
|
|
|
$
|
573,194
|
|
Intersegment sales
|
(1,070
|
)
|
|
(643
|
)
|
|
(4,755
|
)
|
|
—
|
|
|
(6,468
|
)
|
|||||
Net sales to external customers
|
$
|
377,866
|
|
|
$
|
100,746
|
|
|
$
|
81,797
|
|
|
$
|
6,317
|
|
|
$
|
566,726
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted EBITDA
|
$
|
58,963
|
|
|
$
|
13,642
|
|
|
$
|
11,998
|
|
|
$
|
(6,317
|
)
|
|
$
|
78,286
|
|
|
Six Months Ended June 30, 2019
|
||||||||||||||||||
(In thousands)
|
North American Residential
|
|
Europe
|
|
Architectural
|
|
Corporate & Other
|
|
Total
|
||||||||||
Net sales
|
$
|
735,307
|
|
|
$
|
166,100
|
|
|
$
|
189,499
|
|
|
$
|
11,927
|
|
|
$
|
1,102,833
|
|
Intersegment sales
|
(1,972
|
)
|
|
(880
|
)
|
|
(6,727
|
)
|
|
—
|
|
|
(9,579
|
)
|
|||||
Net sales to external customers
|
$
|
733,335
|
|
|
$
|
165,220
|
|
|
$
|
182,772
|
|
|
$
|
11,927
|
|
|
$
|
1,093,254
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted EBITDA
|
$
|
117,022
|
|
|
$
|
23,405
|
|
|
$
|
20,392
|
|
|
$
|
(15,607
|
)
|
|
$
|
145,212
|
|
|
Six Months Ended July 1, 2018
|
||||||||||||||||||
(In thousands)
|
North American Residential
|
|
Europe
|
|
Architectural
|
|
Corporate & Other
|
|
Total
|
||||||||||
Net sales
|
$
|
739,478
|
|
|
$
|
189,141
|
|
|
$
|
158,116
|
|
|
$
|
10,741
|
|
|
$
|
1,097,476
|
|
Intersegment sales
|
(1,932
|
)
|
|
(1,291
|
)
|
|
(9,648
|
)
|
|
—
|
|
|
(12,871
|
)
|
|||||
Net sales to external customers
|
$
|
737,546
|
|
|
$
|
187,850
|
|
|
$
|
148,468
|
|
|
$
|
10,741
|
|
|
$
|
1,084,605
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted EBITDA
|
$
|
109,361
|
|
|
$
|
23,572
|
|
|
$
|
19,658
|
|
|
$
|
(12,891
|
)
|
|
$
|
139,700
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(In thousands)
|
June 30, 2019
|
|
July 1, 2018
|
|
June 30, 2019
|
|
July 1, 2018
|
||||||||
Adjusted EBITDA
|
$
|
79,733
|
|
|
$
|
78,286
|
|
|
$
|
145,212
|
|
|
$
|
139,700
|
|
Less (plus):
|
|
|
|
|
|
|
|
||||||||
Depreciation
|
18,201
|
|
|
13,700
|
|
|
36,486
|
|
|
27,634
|
|
||||
Amortization
|
7,329
|
|
|
7,325
|
|
|
14,926
|
|
|
13,910
|
|
||||
Share based compensation expense
|
2,093
|
|
|
3,538
|
|
|
4,773
|
|
|
6,603
|
|
||||
Loss on disposal of property, plant and equipment
|
1,322
|
|
|
1,900
|
|
|
4,235
|
|
|
2,512
|
|
||||
Restructuring costs
|
1,361
|
|
|
—
|
|
|
5,101
|
|
|
—
|
|
||||
Asset impairment
|
3,142
|
|
|
—
|
|
|
13,767
|
|
|
—
|
|
||||
Loss on disposal of subsidiaries
|
—
|
|
|
—
|
|
|
4,605
|
|
|
—
|
|
||||
Interest expense, net
|
11,357
|
|
|
9,074
|
|
|
22,484
|
|
|
17,830
|
|
||||
Other income, net of expense
|
(456
|
)
|
|
(839
|
)
|
|
(1,586
|
)
|
|
(861
|
)
|
||||
Income tax expense
|
10,293
|
|
|
7,894
|
|
|
10,351
|
|
|
14,595
|
|
||||
Net income attributable to non-controlling interest
|
849
|
|
|
953
|
|
|
2,039
|
|
|
1,910
|
|
||||
Net income attributable to Masonite
|
$
|
24,242
|
|
|
$
|
34,741
|
|
|
$
|
28,031
|
|
|
$
|
55,567
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(In thousands)
|
June 30, 2019
|
|
July 1, 2018
|
|
June 30, 2019
|
|
July 1, 2018
|
||||||||
Accumulated foreign currency translation losses, beginning of period
|
$
|
(116,143
|
)
|
|
$
|
(83,829
|
)
|
|
$
|
(129,930
|
)
|
|
$
|
(89,824
|
)
|
Foreign currency translation gain
|
(5,178
|
)
|
|
(31,445
|
)
|
|
7,812
|
|
|
(25,671
|
)
|
||||
Income tax benefit (expense) on foreign currency translation gain
|
13
|
|
|
(21
|
)
|
|
25
|
|
|
(43
|
)
|
||||
Cumulative translation adjustment recognized upon deconsolidation of subsidiary
|
—
|
|
|
—
|
|
|
1,001
|
|
|
—
|
|
||||
Less: foreign currency translation gain (loss) attributable to non-controlling interest
|
132
|
|
|
(369
|
)
|
|
348
|
|
|
(612
|
)
|
||||
Accumulated foreign currency translation losses, end of period
|
(121,440
|
)
|
|
(114,926
|
)
|
|
(121,440
|
)
|
|
(114,926
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Accumulated pension and other post-retirement adjustments, beginning of period
|
(22,690
|
)
|
|
(20,106
|
)
|
|
(22,989
|
)
|
|
(20,328
|
)
|
||||
Amortization of actuarial net losses
|
403
|
|
|
299
|
|
|
807
|
|
|
599
|
|
||||
Income tax expense on amortization of actuarial net losses
|
(105
|
)
|
|
(79
|
)
|
|
(210
|
)
|
|
(157
|
)
|
||||
Accumulated pension and other post-retirement adjustments
|
(22,392
|
)
|
|
(19,886
|
)
|
|
(22,392
|
)
|
|
(19,886
|
)
|
||||
|
|
|
|
|
|
|
|
|
|
||||||
Accumulated other comprehensive loss
|
$
|
(143,832
|
)
|
|
$
|
(134,812
|
)
|
|
$
|
(143,832
|
)
|
|
$
|
(134,812
|
)
|
|
|
|
|
|
|
|
|
||||||||
Other comprehensive income (loss), net of tax
|
$
|
(4,867
|
)
|
|
$
|
(31,246
|
)
|
|
$
|
9,435
|
|
|
$
|
(25,272
|
)
|
Less: other comprehensive income (loss) attributable to non-controlling interest
|
132
|
|
|
(369
|
)
|
|
348
|
|
|
(612
|
)
|
||||
Other comprehensive income (loss) attributable to Masonite
|
$
|
(4,999
|
)
|
|
$
|
(30,877
|
)
|
|
$
|
9,087
|
|
|
$
|
(24,660
|
)
|
|
Six Months Ended
|
||||||
(In thousands)
|
June 30, 2019
|
|
July 1, 2018
|
||||
Transactions involving cash:
|
|
|
|
||||
Interest paid
|
$
|
24,068
|
|
|
$
|
17,775
|
|
Interest received
|
1,158
|
|
|
504
|
|
||
Income taxes paid
|
8,392
|
|
|
4,380
|
|
||
Income tax refunds
|
—
|
|
|
81
|
|
||
Cash paid for operating lease liabilities
|
12,724
|
|
|
—
|
|
||
Non-cash transactions:
|
|
|
|
||||
Right-of-use assets acquired under operating leases
|
48,970
|
|
|
—
|
|
|
June 30, 2019
|
|
December 30, 2018
|
||||
Cash and cash equivalents
|
$
|
112,644
|
|
|
$
|
115,656
|
|
Restricted cash
|
10,644
|
|
|
10,485
|
|
||
Total cash, cash equivalents and restricted cash
|
$
|
123,288
|
|
|
$
|
126,141
|
|
•
|
the strength of the economy;
|
•
|
the amount and type of residential and commercial construction;
|
•
|
housing sales and home values;
|
•
|
the age of existing home stock, home vacancy rates and foreclosures;
|
•
|
non-residential building occupancy rates;
|
•
|
increases in the cost of raw materials or wages or any shortage in supplies or labor;
|
•
|
the availability and cost of credit;
|
•
|
employment rates and consumer confidence; and
|
•
|
demographic factors such as immigration and migration of the population and trends in household formation.
|
•
|
BWI: On November 1, 2018, we completed the acquisition of the operating assets of Bridgewater Wholesalers Inc. ("BWI") for total consideration of $22.3 million, subject to certain customary post-closing adjustments. BWI is headquartered in Branchburg, New Jersey, and is a fabricator and distributor of residential interior and exterior door systems, supporting customers in the Mid-Atlantic and Northeastern United States. Their product offerings include residential interior and exterior doors, commercial doors and hardware as well as value added pre-finishing services. Due to the timing of the acquisition, the purchase price allocation was not complete as of the date the financial statements were issued.
|
•
|
Graham and Maiman: On June 1, 2018, we completed the acquisition of the operating assets of the wood door companies of AADG, Inc., including the brands Graham Manufacturing Corporation and The Maiman Company (collectively, "Graham & Maiman"). We acquired the operating assets of Graham & Maiman for cash consideration of $39.0 million. Graham & Maiman are based in Mason City, Iowa, and Springfield, Missouri. Graham & Maiman provide the non-residential construction industry with a full range of architectural premium and custom grade flush wood doors, architectural stile and rail wood doors, thermal-fused flush wood doors and wood door frames.
|
•
|
DW3: On January 29, 2018, we completed the acquisition of DW3 Products Holdings Limited ("DW3"), a leading UK provider of high quality premium door solutions and window systems, supplying products under brand names such as Solidor, Residor, Nicedor and Residence. We acquired 100% of the equity interests in DW3, funded solely by cash on hand of $96.3 million, net of cash acquired. DW3 is based in Stoke-on-Trent and Gloucester, England, and their online quick ship capabilities and product portfolio both complement and expand the strategies we are pursuing with our business.
|
•
|
PDS: On March 21, 2019, we completed the sale of all of the capital stock of Performance Doorset Solutions Limited ("PDS") for nominal consideration. The disposition of this business resulted in a loss on deconsolidation of $4.6 million, which was recognized during the first quarter of 2019 in the Europe segment.
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(In thousands)
|
June 30, 2019
|
|
July 1, 2018
|
|
June 30, 2019
|
|
July 1, 2018
|
||||||||
Net sales
|
$
|
562,943
|
|
|
$
|
566,726
|
|
|
$
|
1,093,254
|
|
|
$
|
1,084,605
|
|
Cost of goods sold
|
434,013
|
|
|
443,052
|
|
|
852,220
|
|
|
855,502
|
|
||||
Gross profit
|
128,930
|
|
|
123,674
|
|
|
241,034
|
|
|
229,103
|
|
||||
Gross profit as a % of net sales
|
22.9
|
%
|
|
21.8
|
%
|
|
22.0
|
%
|
|
21.1
|
%
|
||||
Selling, general and administration expenses
|
78,142
|
|
|
71,851
|
|
|
156,242
|
|
|
140,062
|
|
||||
Selling, general and administration expenses as a % of net sales
|
13.9
|
%
|
|
12.7
|
%
|
|
14.3
|
%
|
|
12.9
|
%
|
||||
Restructuring costs
|
1,361
|
|
|
—
|
|
|
5,101
|
|
|
—
|
|
||||
Asset impairment
|
3,142
|
|
|
—
|
|
|
13,767
|
|
|
—
|
|
||||
Loss on disposal of subsidiaries
|
—
|
|
|
—
|
|
|
4,605
|
|
|
—
|
|
||||
Operating income
|
46,285
|
|
|
51,823
|
|
|
61,319
|
|
|
89,041
|
|
||||
Interest expense, net
|
11,357
|
|
|
9,074
|
|
|
22,484
|
|
|
17,830
|
|
||||
Other income, net of expense
|
(456
|
)
|
|
(839
|
)
|
|
(1,586
|
)
|
|
(861
|
)
|
||||
Income before income tax expense
|
35,384
|
|
|
43,588
|
|
|
40,421
|
|
|
72,072
|
|
||||
Income tax expense
|
10,293
|
|
|
7,894
|
|
|
10,351
|
|
|
14,595
|
|
||||
Net income
|
25,091
|
|
|
35,694
|
|
|
30,070
|
|
|
57,477
|
|
||||
Less: net income attributable to non-controlling interests
|
849
|
|
|
953
|
|
|
2,039
|
|
|
1,910
|
|
||||
Net income attributable to Masonite
|
$
|
24,242
|
|
|
$
|
34,741
|
|
|
$
|
28,031
|
|
|
$
|
55,567
|
|
|
Three Months Ended June 30, 2019
|
||||||||||||||||||
(In thousands)
|
North American Residential
|
|
Europe
|
|
Architectural
|
|
Corporate & Other
|
|
Total
|
||||||||||
Sales
|
$
|
380,505
|
|
|
$
|
81,361
|
|
|
$
|
101,146
|
|
|
$
|
5,199
|
|
|
$
|
568,211
|
|
Intersegment sales
|
(895
|
)
|
|
(408
|
)
|
|
(3,965
|
)
|
|
—
|
|
|
(5,268
|
)
|
|||||
Net sales to external customers
|
$
|
379,610
|
|
|
$
|
80,953
|
|
|
$
|
97,181
|
|
|
$
|
5,199
|
|
|
$
|
562,943
|
|
Percentage of consolidated external net sales
|
67.4
|
%
|
|
14.4
|
%
|
|
17.3
|
%
|
|
|
|
|
|
Three Months Ended July 1, 2018
|
||||||||||||||||||
(In thousands)
|
North American Residential
|
|
Europe
|
|
Architectural
|
|
Corporate & Other
|
|
Total
|
||||||||||
Sales
|
$
|
378,936
|
|
|
$
|
101,389
|
|
|
$
|
86,552
|
|
|
$
|
6,317
|
|
|
$
|
573,194
|
|
Intersegment sales
|
(1,070
|
)
|
|
(643
|
)
|
|
(4,755
|
)
|
|
—
|
|
|
(6,468
|
)
|
|||||
Net sales to external customers
|
$
|
377,866
|
|
|
$
|
100,746
|
|
|
$
|
81,797
|
|
|
$
|
6,317
|
|
|
$
|
566,726
|
|
Percentage of consolidated external net sales
|
66.7
|
%
|
|
17.8
|
%
|
|
14.4
|
%
|
|
|
|
|
|
Three Months Ended June 30, 2019
|
||||||||||||||||||
(In thousands)
|
North American Residential
|
|
Europe
|
|
Architectural
|
|
Corporate & Other
|
|
Total
|
||||||||||
Adjusted EBITDA
|
$
|
63,401
|
|
|
$
|
13,408
|
|
|
$
|
12,778
|
|
|
$
|
(9,854
|
)
|
|
$
|
79,733
|
|
Adjusted EBITDA as a percentage of segment net sales
|
16.7
|
%
|
|
16.6
|
%
|
|
13.1
|
%
|
|
|
|
14.2
|
%
|
|
Three Months Ended July 1, 2018
|
||||||||||||||||||
(In thousands)
|
North American Residential
|
|
Europe
|
|
Architectural
|
|
Corporate & Other
|
|
Total
|
||||||||||
Adjusted EBITDA
|
$
|
58,963
|
|
|
$
|
13,642
|
|
|
$
|
11,998
|
|
|
$
|
(6,317
|
)
|
|
$
|
78,286
|
|
Adjusted EBITDA as a percentage of segment net sales
|
15.6
|
%
|
|
13.5
|
%
|
|
14.7
|
%
|
|
|
|
13.8
|
%
|
|
Three Months Ended June 30, 2019
|
||||||||||||||||||
(In thousands)
|
North American Residential
|
|
Europe
|
|
Architectural
|
|
Corporate & Other
|
|
Total
|
||||||||||
Adjusted EBITDA
|
$
|
63,401
|
|
|
$
|
13,408
|
|
|
$
|
12,778
|
|
|
$
|
(9,854
|
)
|
|
$
|
79,733
|
|
Less (plus):
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation
|
9,800
|
|
|
2,354
|
|
|
3,505
|
|
|
2,542
|
|
|
18,201
|
|
|||||
Amortization
|
437
|
|
|
3,656
|
|
|
2,154
|
|
|
1,082
|
|
|
7,329
|
|
|||||
Share based compensation expense
|
—
|
|
|
—
|
|
|
—
|
|
|
2,093
|
|
|
2,093
|
|
|||||
Loss on disposal of property, plant and equipment
|
1,110
|
|
|
148
|
|
|
49
|
|
|
15
|
|
|
1,322
|
|
|||||
Restructuring costs
|
1,313
|
|
|
101
|
|
|
(118
|
)
|
|
65
|
|
|
1,361
|
|
|||||
Asset impairment
|
3,142
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,142
|
|
|||||
Interest expense, net
|
—
|
|
|
—
|
|
|
—
|
|
|
11,357
|
|
|
11,357
|
|
|||||
Other (income), net of expense
|
86
|
|
|
(35
|
)
|
|
2
|
|
|
(509
|
)
|
|
(456
|
)
|
|||||
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
10,293
|
|
|
10,293
|
|
|||||
Net income attributable to non-controlling interest
|
684
|
|
|
—
|
|
|
—
|
|
|
165
|
|
|
849
|
|
|||||
Net income (loss) attributable to Masonite
|
$
|
46,829
|
|
|
$
|
7,184
|
|
|
$
|
7,186
|
|
|
$
|
(36,957
|
)
|
|
$
|
24,242
|
|
|
Three Months Ended July 1, 2018
|
||||||||||||||||||
(In thousands)
|
North American Residential
|
|
Europe
|
|
Architectural
|
|
Corporate & Other
|
|
Total
|
||||||||||
Adjusted EBITDA
|
$
|
58,963
|
|
|
$
|
13,642
|
|
|
$
|
11,998
|
|
|
$
|
(6,317
|
)
|
|
$
|
78,286
|
|
Less (plus):
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation
|
7,090
|
|
|
2,575
|
|
|
2,192
|
|
|
1,843
|
|
|
13,700
|
|
|||||
Amortization
|
295
|
|
|
4,058
|
|
|
2,257
|
|
|
715
|
|
|
7,325
|
|
|||||
Share based compensation expense
|
—
|
|
|
—
|
|
|
—
|
|
|
3,538
|
|
|
3,538
|
|
|||||
Loss on disposal of property, plant and equipment
|
472
|
|
|
6
|
|
|
24
|
|
|
1,398
|
|
|
1,900
|
|
|||||
Interest expense, net
|
—
|
|
|
—
|
|
|
—
|
|
|
9,074
|
|
|
9,074
|
|
|||||
Other (income), net of expense
|
—
|
|
|
147
|
|
|
—
|
|
|
(986
|
)
|
|
(839
|
)
|
|||||
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
7,894
|
|
|
7,894
|
|
|||||
Net income attributable to non-controlling interest
|
891
|
|
|
—
|
|
|
—
|
|
|
62
|
|
|
953
|
|
|||||
Net income (loss) attributable to Masonite
|
$
|
50,215
|
|
|
$
|
6,856
|
|
|
$
|
7,525
|
|
|
$
|
(29,855
|
)
|
|
$
|
34,741
|
|
|
Six Months Ended June 30, 2019
|
||||||||||||||||||
(In thousands)
|
North American Residential
|
|
Europe
|
|
Architectural
|
|
Corporate & Other
|
|
Total
|
||||||||||
Sales
|
$
|
735,307
|
|
|
$
|
166,100
|
|
|
$
|
189,499
|
|
|
$
|
11,927
|
|
|
$
|
1,102,833
|
|
Intersegment sales
|
(1,972
|
)
|
|
(880
|
)
|
|
(6,727
|
)
|
|
—
|
|
|
(9,579
|
)
|
|||||
Net sales to external customers
|
$
|
733,335
|
|
|
$
|
165,220
|
|
|
$
|
182,772
|
|
|
$
|
11,927
|
|
|
$
|
1,093,254
|
|
Percentage of consolidated external net sales
|
67.1
|
%
|
|
15.1
|
%
|
|
16.7
|
%
|
|
|
|
|
|
Six Months Ended July 1, 2018
|
||||||||||||||||||
(In thousands)
|
North American Residential
|
|
Europe
|
|
Architectural
|
|
Corporate & Other
|
|
Total
|
||||||||||
Sales
|
$
|
739,478
|
|
|
$
|
189,141
|
|
|
$
|
158,116
|
|
|
$
|
10,741
|
|
|
$
|
1,097,476
|
|
Intersegment sales
|
(1,932
|
)
|
|
(1,291
|
)
|
|
(9,648
|
)
|
|
—
|
|
|
(12,871
|
)
|
|||||
Net sales to external customers
|
$
|
737,546
|
|
|
$
|
187,850
|
|
|
$
|
148,468
|
|
|
$
|
10,741
|
|
|
$
|
1,084,605
|
|
Percentage of consolidated external net sales
|
68.0
|
%
|
|
17.3
|
%
|
|
13.7
|
%
|
|
|
|
|
|
Six Months Ended June 30, 2019
|
||||||||||||||||||
(In thousands)
|
North American Residential
|
|
Europe
|
|
Architectural
|
|
Corporate & Other
|
|
Total
|
||||||||||
Adjusted EBITDA
|
$
|
117,022
|
|
|
$
|
23,405
|
|
|
$
|
20,392
|
|
|
$
|
(15,607
|
)
|
|
$
|
145,212
|
|
Adjusted EBITDA as a percentage of segment net sales
|
16.0
|
%
|
|
14.2
|
%
|
|
11.2
|
%
|
|
|
|
13.3
|
%
|
|
Six Months Ended July 1, 2018
|
||||||||||||||||||
(In thousands)
|
North American Residential
|
|
Europe
|
|
Architectural
|
|
Corporate & Other
|
|
Total
|
||||||||||
Adjusted EBITDA
|
$
|
109,361
|
|
|
$
|
23,572
|
|
|
$
|
19,658
|
|
|
$
|
(12,891
|
)
|
|
$
|
139,700
|
|
Adjusted EBITDA as a percentage of segment net sales
|
14.8
|
%
|
|
12.5
|
%
|
|
13.2
|
%
|
|
|
|
12.9
|
%
|
|
Six Months Ended June 30, 2019
|
||||||||||||||||||
(In thousands)
|
North American Residential
|
|
Europe
|
|
Architectural
|
|
Corporate & Other
|
|
Total
|
||||||||||
Adjusted EBITDA
|
$
|
117,022
|
|
|
$
|
23,405
|
|
|
$
|
20,392
|
|
|
$
|
(15,607
|
)
|
|
$
|
145,212
|
|
Less (plus):
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation
|
18,879
|
|
|
4,736
|
|
|
6,246
|
|
|
6,625
|
|
|
36,486
|
|
|||||
Amortization
|
886
|
|
|
7,621
|
|
|
4,247
|
|
|
2,172
|
|
|
14,926
|
|
|||||
Share based compensation expense
|
—
|
|
|
—
|
|
|
—
|
|
|
4,773
|
|
|
4,773
|
|
|||||
Loss on disposal of property, plant and equipment
|
1,451
|
|
|
2,617
|
|
|
146
|
|
|
21
|
|
|
4,235
|
|
|||||
Restructuring costs
|
3,193
|
|
|
963
|
|
|
486
|
|
|
459
|
|
|
5,101
|
|
|||||
Asset impairment
|
13,767
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13,767
|
|
|||||
Loss on disposal of subsidiaries
|
—
|
|
|
4,605
|
|
|
—
|
|
|
—
|
|
|
4,605
|
|
|||||
Interest expense, net
|
—
|
|
|
—
|
|
|
—
|
|
|
22,484
|
|
|
22,484
|
|
|||||
Other (income), net of expense
|
86
|
|
|
(174
|
)
|
|
2
|
|
|
(1,500
|
)
|
|
(1,586
|
)
|
|||||
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
10,351
|
|
|
10,351
|
|
|||||
Net income attributable to non-controlling interest
|
1,670
|
|
|
—
|
|
|
—
|
|
|
369
|
|
|
2,039
|
|
|||||
Net income (loss) attributable to Masonite
|
$
|
77,090
|
|
|
$
|
3,037
|
|
|
$
|
9,265
|
|
|
$
|
(61,361
|
)
|
|
$
|
28,031
|
|
|
Six Months Ended July 1, 2018
|
||||||||||||||||||
(In thousands)
|
North American Residential
|
|
Europe
|
|
Architectural
|
|
Corporate & Other
|
|
Total
|
||||||||||
Adjusted EBITDA
|
$
|
109,361
|
|
|
$
|
23,572
|
|
|
$
|
19,658
|
|
|
$
|
(12,891
|
)
|
|
$
|
139,700
|
|
Less (plus):
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation
|
14,434
|
|
|
4,878
|
|
|
4,222
|
|
|
4,100
|
|
|
27,634
|
|
|||||
Amortization
|
776
|
|
|
7,297
|
|
|
4,511
|
|
|
1,326
|
|
|
13,910
|
|
|||||
Share based compensation expense
|
—
|
|
|
—
|
|
|
—
|
|
|
6,603
|
|
|
6,603
|
|
|||||
Loss on disposal of property, plant and equipment
|
1,005
|
|
|
6
|
|
|
103
|
|
|
1,398
|
|
|
2,512
|
|
|||||
Interest expense, net
|
—
|
|
|
—
|
|
|
—
|
|
|
17,830
|
|
|
17,830
|
|
|||||
Other (income), net of expense
|
—
|
|
|
182
|
|
|
—
|
|
|
(1,043
|
)
|
|
(861
|
)
|
|||||
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
14,595
|
|
|
14,595
|
|
|||||
Net income attributable to non-controlling interest
|
1,861
|
|
|
—
|
|
|
—
|
|
|
49
|
|
|
1,910
|
|
|||||
Net income (loss) attributable to Masonite
|
$
|
91,285
|
|
|
$
|
11,209
|
|
|
$
|
10,822
|
|
|
$
|
(57,749
|
)
|
|
$
|
55,567
|
|
|
Total Number of Shares Purchased
|
|
Average Price Paid per Share
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
|
|
Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs
|
||||||
April 1, 2019, through April 28, 2019
|
166,167
|
|
|
$
|
50.85
|
|
|
166,167
|
|
|
$
|
162,351,900
|
|
April 29, 2019, through May 26, 2019
|
19,608
|
|
|
52.60
|
|
|
19,608
|
|
|
161,320,531
|
|
||
May 27, 2019, through June 30, 2019
|
122,011
|
|
|
49.27
|
|
|
122,011
|
|
|
155,309,247
|
|
||
Total
|
307,786
|
|
|
$
|
50.34
|
|
|
307,786
|
|
|
|
|
|
MASONITE INTERNATIONAL CORPORATION
|
|
|
|
|
(Registrant)
|
|
|
|
|
|
|
|
Date:
|
August 6, 2019
|
By
|
/s/ Russell T. Tiejema
|
|
|
|
Russell T. Tiejema
|
|
|
|
|
Executive Vice President and Chief Financial Officer
|
|
|
|
|
(Principal Financial Officer and Principal Accounting Officer)
|
|
1.
|
Employment Agreement.
|
2.
|
Term.
|
3.
|
Position and Duties.
|
4.
|
Place of Performance.
|
5.
|
Compensation and Benefits; Equity Awards.
|
6.
|
Relocation and Other Expenses.
|
7.
|
Confidentiality, Non-Disclosure, Non-Solicitation and Non-Competition Agreement.
|
8.
|
Termination of Employment.
|
9.
|
Compensation Upon Termination.
|
10.
|
280G Cutback.
|
11.
|
Indemnification.
|
12.
|
Attorney’s Fees.
|
13.
|
Notices.
|
14.
|
Severability.
|
15.
|
Survival.
|
16.
|
Assignment.
|
17.
|
Binding Effect.
|
18.
|
Amendment; Waiver.
|
19.
|
Headings.
|
20.
|
Governing Law.
|
21.
|
Dispute Resolution.
|
22.
|
Entire Agreement; Effectiveness of Agreement; Advice of Counsel; Cooperation.
|
23.
|
Counterparts.
|
24.
|
Withholding.
|
25.
|
Section 409A.
|
26.
|
Definitions.
|
(i)
|
I HAVE READ IT CAREFULLY;
|
(iii)
|
I VOLUNTARILY CONSENT TO EVERYTHING IN IT;
|
1.
|
I have reviewed this quarterly report on Form 10-Q for the quarter ended June 30, 2019, of Masonite International Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements and other financial information included in this report fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected or is reasonably likely to materially affect the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.
|
Date:
|
August 6, 2019
|
/s/
|
Howard C. Heckes
|
|
Howard C. Heckes
|
|
President and Chief Executive Officer
|
|
(Principal Executive Officer)
|
1.
|
I have reviewed this quarterly report on Form 10-Q for the quarter ended June 30, 2019, of Masonite International Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements and other financial information included in this report fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected or is reasonably likely to materially affect the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.
|
Date:
|
August 6, 2019
|
/s/
|
Russell T. Tiejema
|
|
Russell T. Tiejema
|
|
Executive Vice President and Chief Financial Officer
|
|
(Principal Financial Officer and Principal Accounting Officer)
|
1.
|
The Quarterly Report on Form 10-Q of the Company for the quarter ended June 30, 2019 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m); and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date:
|
August 6, 2019
|
/s/
|
Howard C. Heckes
|
|
Howard C. Heckes
|
|
President and Chief Executive Officer
|
|
(Principal Executive Officer)
|
1.
|
The Quarterly Report on Form 10-Q of the Company for the quarter ended June 30, 2019 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m); and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date:
|
August 6, 2019
|
/s/
|
Russell T. Tiejema
|
|
Russell T. Tiejema
|
|
Executive Vice President and Chief Financial Officer
|
|
(Principal Financial Officer and Principal Accounting Officer)
|