Delaware
|
|
94-3196943
|
(State or other jurisdiction of
|
|
(I.R.S. Employer
|
incorporation or organization)
|
|
Identification No.)
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Title of Each Class
|
Trading Symbol
|
Name of Each Exchange on Which Registered
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Common Stock, par value $0.01
|
SSD
|
New York Stock Exchange
|
Large accelerated filer
|
x
|
Accelerated filer
|
☐
|
Non-accelerated filer
|
☐
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Smaller reporting company
|
☐
|
|
|
Emerging growth company
|
☐
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Page
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PART I
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Item 1.
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||
Item 1A.
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||
Item 1B.
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Item 2.
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Item 3.
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Item 4.
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PART II
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Item 5.
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||
Item 6.
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Item 7.
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||
Item 7A.
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||
Item 8.
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Item 9.
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||
Item 9A.
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Item 9B.
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PART III
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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PART 1V
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Item 15.
|
||
Item 16.
|
•
|
the impact, execution and effectiveness of the Company’s current strategic plan, the 2020 Plan, and initiatives the realization of the assumptions made under the plan and the efforts and costs to implement the plan and initiatives;
|
•
|
general economic cycles and construction business conditions including changes in U.S. housing starts;
|
•
|
customer acceptance of our products;
|
•
|
product liability claims, contractual liability, engineering and design liability and similar liabilities or claims,
|
•
|
relationships with partners, suppliers and customers and their financial condition;
|
•
|
materials and manufacturing costs;
|
•
|
technological developments, including system updates and conversions;
|
•
|
increased competition;
|
•
|
changes in laws or industry practices;
|
•
|
litigation risks and actions by activist shareholders;
|
•
|
changes in market conditions;
|
•
|
governmental and business conditions in countries where our products are manufactured and sold;
|
•
|
natural disasters and other factors that are beyond the Company’s reasonable control;
|
•
|
changes in trade regulations, treaties or agreements or in U.S. and international taxes, tariffs and duties including those imposed on the Company’s income, imports, exports and repatriation of funds;
|
•
|
effects of merger or acquisition activities;
|
•
|
actual or potential takeover or other change-of-control threats; and
|
•
|
changes in our plans, strategies, objectives, expectations or intentions.
|
•
|
maintaining frequent customer contacts and service levels;
|
•
|
continuing to sponsor seminars to inform architects, engineers, contractors and building officials on appropriate use, proper installation and identification of the Company’s products;
|
•
|
continuing to invest in mobile, web and software applications for customers to help them do their jobs more efficiently and connect with customers utilizing social media, blog posts and videos;
|
•
|
continuing to invest in Building Information Modeling ("BIM") software services and solutions for home builders and lumber-building material suppliers; and
|
•
|
continuing to innovate and diversify our product offerings.
|
•
|
complement the Company’s existing product lines;
|
•
|
can be marketed through the Company’s existing distribution channels;
|
•
|
might benefit from use of the Company’s brand names and expertise;
|
•
|
are responsive to needs of the Company’s customers;
|
•
|
expand the Company’s markets geographically; and
|
•
|
reduce the Company’s dependence on the United States residential construction market.
|
•
|
new connectors and lateral products for wood framing applications;
|
•
|
new connectors for timber & offsite constructions;
|
•
|
new steel connections for mid-rise steel construction;
|
•
|
new connectors for cold formed steel applications;
|
•
|
new fastener products for wood construction; and
|
•
|
new mechanical anchors for concrete and masonry construction.
|
•
|
Distributors. The Company regularly evaluates its distribution coverage and the service levels provided by its distributors, and from time to time implements changes. The Company evaluates distributor product mix and conducts promotions to encourage distributors to add the Company’s products that complement the mix of product offerings in their markets.
|
•
|
Home Centers. The Company intends to increase penetration of the DIY markets by continuing to expand its product offerings through home centers. The Company’s sales force maintains on-going contact with home centers to work with them in a broad range of areas, including inventory levels, retail display maintenance and product knowledge training. The Company’s strategy is to ensure that the home center retail stores are fully stocked with adequate supplies of the Company’s products carried by those stores. The Company has further developed extensive bar coding and merchandising aids and has devoted a portion of its research and development efforts to DIY products. The Company’s sales to home centers increased year-over-year in 2019, 2018 and 2017.
|
•
|
Dealers. In some markets, the Company sells its products directly to lumber dealers and cooperatives.
|
•
|
OEM Relationships. The Company works closely with manufacturers of engineered wood, Composite Laminated Timber and OEMs for off-site construction to develop and expand the application and sales of its engineered wood connector, fastener, anchor and truss products. The Company has relationships with many of the leaders in these industries.
|
•
|
International Sales. The Company has established a presence in the European Community through acquisition of companies with existing customer bases and through servicing United States-based customers operating in Europe. The Company also distributes connector, anchor and epoxy products in Mexico, Chile, Australia, New Zealand, and the Middle East.
|
•
|
Connectors - Connectors are prefabricated metal products that attach wood, concrete, masonry or steel together and are essential for tying wood construction elements together and create safer and stronger buildings;
|
•
|
Truss Connector Plates - Truss connector plates are toothed metal plates that join wood members together to form a truss and are marketed under the name Integrated Component Systems. The Company continues to develop software to assist truss and component manufacturers in modeling, designing trusses and selecting the appropriate truss plates for the applicable jobs;
|
•
|
Fastening Line - The fastening line includes various nails, screws and staples, which are complemented by the Company's Quik Drive auto-feed screw driving system, which is used in numerous applications such as decking, subfloors, drywall and roofing; and
|
•
|
Lateral Resistive System - Lateral resistive systems are assemblies used to resist earthquake or wind forces and include steel and wood shearwalls, Anchor Tiedown Systems and steel moment frames.
|
•
|
Anchor Products - Anchor products include adhesives, mechanical anchors, carbide drill bits and powder-actuated pins and tools used for numerous applications of anchoring or attaching elements onto concrete, brick, masonry and steel; and
|
•
|
Construction, Repair, Protection and Strengthening Products - Concrete construction repair, protection and strengthening products include grouts, coatings, sealers, mortars, fiberglass and fiber-reinforced polymer systems and asphalt products.
|
•
|
uncertainty about the housing and residential construction and home improvement markets;
|
•
|
changes in economic conditions or the political climate that adversely impact our customers’ confidence or financial condition;
|
•
|
unemployment and foreclosure rates;
|
•
|
inventory loss;
|
•
|
interest rate fluctuations;
|
•
|
raw material and energy costs;
|
•
|
labor and healthcare costs;
|
•
|
the availability of financing, or lack thereof, to builders, developers, and consumers;
|
•
|
the state of the credit markets, including mortgages and home equity loans;
|
•
|
weather; natural disasters; and
|
•
|
acts of terrorism.
|
◦
|
Eliminate at least 25% to 30% of our product SKUs, implement Lean principles in our factories, and achieve an additional 30% reduction of our raw materials and finished goods inventory by fiscal 2020.
|
•
|
changes in duties, taxes, tariffs and other charges on imports;
|
•
|
requirements as to where products and/or inputs are manufactured or sourced;
|
•
|
creation of export licensing requirements, imposition of restrictions on export quantities or specifications of minimum export pricing/and or export prices or duties;
|
•
|
limitations on foreign owned business; or
|
•
|
government actions to cancel contracts, re-denominate the official currency, renounce or default on obligations, renegotiate terms unilaterally or expropriate assets.
|
|
|
Number
|
|
|
|
|
|
|
||||
|
|
Of
|
|
Approximate Square Footage
|
||||||||
|
|
Properties
|
|
Owned
|
|
Leased
|
|
Total
|
||||
|
|
|
|
(in thousands of square feet)
|
||||||||
North America
|
|
28
|
|
|
2,287
|
|
|
683
|
|
|
2,970
|
|
Europe
|
|
18
|
|
|
533
|
|
|
342
|
|
|
875
|
|
Asia/Pacific
|
|
10
|
|
|
175
|
|
|
41
|
|
|
216
|
|
Administrative and all other
|
|
1
|
|
|
89
|
|
|
—
|
|
|
89
|
|
Total
|
|
57
|
|
|
3,084
|
|
|
1,066
|
|
|
4,150
|
|
|
(a)
|
|
(b)
|
|
(c)
|
|
(d)
|
|
|||||
Period
|
Total Number of Shares Purchased
|
|
Average Price Paid per Share
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
|
|
Approximate Value of Shares that May Yet Be Purchased Under the Plans or Programs (1)
|
|
|||||
October 1 - October 31, 2019
|
—
|
|
|
$
|
—
|
|
—
|
|
—
|
|
|
$48.6 million
|
|
November 1 - November 30, 2019
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$48.6 million
|
|
|
December 1 - December 31, 2019
|
117,988
|
|
|
$
|
79.49
|
|
|
117,988
|
|
|
$39.2 million
|
|
|
Total
|
117,988
|
|
|
|
|
|
|
|
|
|
Years Ended December 31,
|
||||||||||||||
(in thousands, except per-share data)
|
2019
|
2018
|
2017
|
2016
|
2015
|
||||||||||
Statement of Operations Data:
|
|
|
|
|
|
|
|
|
|
|
|||||
Net sales
|
$
|
1,136,539
|
|
$
|
1,078,809
|
|
$
|
977,025
|
|
$
|
860,661
|
|
$
|
794,059
|
|
Gross profit
|
492,130
|
|
480,287
|
|
443,381
|
|
409,880
|
|
356,406
|
|
|||||
Gross profit margin
|
43.3
|
%
|
44.5
|
%
|
45.4
|
%
|
47.6
|
%
|
44.9
|
%
|
|||||
Total operating expenses
|
316,900
|
|
311,555
|
|
305,268
|
|
268,990
|
|
247,474
|
|
|||||
Percentage of sales
|
27.9
|
%
|
28.9
|
%
|
31.2
|
%
|
31.3
|
%
|
31.2
|
%
|
|||||
Income from operations
|
181,254
|
|
172,625
|
|
138,273
|
|
141,670
|
|
109,320
|
|
|||||
Percentage of sales
|
15.9
|
%
|
16.0
|
%
|
14.2
|
%
|
16.5
|
%
|
13.8
|
%
|
|||||
Net income
|
$
|
133,982
|
|
$
|
126,633
|
|
$
|
92,617
|
|
$
|
89,734
|
|
$
|
67,888
|
|
Percentage of sales
|
11.8
|
%
|
11.7
|
%
|
9.5
|
%
|
10.4
|
%
|
8.5
|
%
|
|||||
Earnings per share of common stock:
|
|
|
|
|
|
|
|
|
|
|
|||||
Basic
|
$
|
3.00
|
|
$
|
2.74
|
|
$
|
1.95
|
|
$
|
1.87
|
|
$
|
1.39
|
|
Diluted
|
$
|
2.98
|
|
$
|
2.72
|
|
$
|
1.94
|
|
$
|
1.86
|
|
$
|
1.38
|
|
Cash dividends declared per share of common stock
|
$
|
0.91
|
|
$
|
0.87
|
|
$
|
0.81
|
|
$
|
0.70
|
|
$
|
0.62
|
|
|
|
||||||||||||||
(in thousands)
|
2019
|
2018
|
2017
|
2016
|
2015
|
||||||||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
|||||
Working capital
|
$
|
482,000
|
|
$
|
447,949
|
|
$
|
447,450
|
|
$
|
476,451
|
|
$
|
494,308
|
|
Property, plant and equipment, net
|
249,012
|
|
254,597
|
|
273,020
|
|
232,810
|
|
213,716
|
|
|||||
Goodwill
|
131,879
|
|
130,250
|
|
137,140
|
|
124,479
|
|
123,950
|
|
|||||
Total assets
|
1,095,366
|
|
1,021,663
|
|
1,037,523
|
|
979,974
|
|
961,309
|
|
|||||
Line of credit and long-term liabilities, including current portion
|
46,329
|
|
16,443
|
|
17,310
|
|
5,336
|
|
16,521
|
|
|||||
Total liabilities
|
203,409
|
|
166,149
|
|
152,745
|
|
114,132
|
|
111,485
|
|
|||||
Total stockholders’ equity
|
891,957
|
|
855,514
|
|
884,778
|
|
865,842
|
|
849,824
|
|
•
|
increasing our market share and profitability in Europe;
|
•
|
increasing our market share in the concrete space; and
|
•
|
continuing to develop our software to support our core wood products offering while leveraging our strengths in engineering, sales and distribution, and our strong brand name.
|
•
|
First, a continued focus on organic growth with a goal to achieve a net sales compounded annual growth rate of approximately 8% (from $860.7 million reported in fiscal 2016) through fiscal 2020.
|
•
|
Second, rationalizing our cost structure to improve company-wide profitability by reducing total operating expenses as a percentage of net sales from 31.8% in fiscal 2016 to a range of 26.0% to 27.0% by the end of fiscal 2020. We expect to achieve this initiative, aside from top-line growth, through cost reduction measures in Europe and our concrete product line, zero-based budgeting for certain expense categories, a SKU reduction program to right-size our product offering and a commitment to remaining headcount neutral (except in the production and sales departments to meet demands from sales growth). These reductions were to be offset by the Company’s ongoing investment in its software initiatives as well as the expenses associated with our ongoing SAP implementation, which includes increasing headcount when necessary.
|
•
|
Third, improving our working capital management and overall balance sheet discipline primarily through the reduction of inventory levels in connection with the implementation of Lean principles in many of our factories. This included improving our inventory turn rate from two-times a year for fiscal 2016 to four-times by the end of 2020. With these efforts, we believed we could achieve an additional 25% to 30% reduction of our raw materials and finished goods inventory through 2020 without adversely impacting day-to-day production and shipping procedures.
|
•
|
we pro-actively increased our anchor inventory in anticipation of potential tariffs on our mechanical anchor finished goods from China, as well as in anticipation of additional demand related to The Home Depot, Inc. (“Home Depot”) rollout;
|
•
|
we bought an additional allotment of steel in order to mitigate the potential impact of availability; and
|
•
|
we have inventory levels to ensure we can meet our customer needs as we continue our SAP roll-out.
|
•
|
Gross margin will be between approximately 43.5% and 44.5%.
|
•
|
Effective tax rate will be approximately 25.0% and 26.0%, including both federal and state income tax rates.
|
|
Years Ended December 31,
|
|||||||
|
2019
|
|
2018
|
|
2017
|
|||
Net sales
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
Cost of sales
|
56.7
|
%
|
|
55.5
|
%
|
|
54.6
|
%
|
Gross profit
|
43.3
|
%
|
|
44.5
|
%
|
|
45.4
|
%
|
Research and development and other engineering
|
4.1
|
%
|
|
4.0
|
%
|
|
4.9
|
%
|
Selling expense
|
9.9
|
%
|
|
10.2
|
%
|
|
11.8
|
%
|
General and administrative expense
|
13.9
|
%
|
|
14.7
|
%
|
|
14.6
|
%
|
Total operating expense
|
27.9
|
%
|
|
28.9
|
%
|
|
31.3
|
%
|
Net gain on disposal of assets
|
(0.5
|
)%
|
|
(1.0
|
)%
|
|
—
|
%
|
Impairment of goodwill
|
—
|
%
|
|
0.6
|
%
|
|
—
|
%
|
Income from operations
|
15.9
|
%
|
|
16.0
|
%
|
|
14.1
|
%
|
Loss in equity investment, before tax
|
(0.2
|
)%
|
|
—
|
%
|
|
—
|
%
|
Foreign exchange gain (loss)
|
(0.1
|
)%
|
|
—
|
%
|
|
0.1
|
%
|
Interest expense, net
|
(0.2
|
)%
|
|
(0.1
|
)%
|
|
(0.1
|
)%
|
Gain on bargain purchase of a business
|
—
|
%
|
|
—
|
%
|
|
0.6
|
%
|
Income before taxes
|
15.7
|
%
|
|
15.9
|
%
|
|
14.8
|
%
|
Provision for income taxes
|
3.9
|
%
|
|
4.2
|
%
|
|
5.3
|
%
|
Net income
|
11.8
|
%
|
|
11.7
|
%
|
|
9.5
|
%
|
|
|
|
Increase (Decrease) in Operating Segment
|
|
|
||||||||||||||||||
|
|
|
North America
|
|
|
|
Asia/
Pacific
|
|
Admin &
All Other
|
|
|
||||||||||||
(in thousands)
|
2018
|
|
|
Europe
|
|
|
|
2019
|
|||||||||||||||
Net sales
|
$
|
1,078,809
|
|
|
$
|
62,262
|
|
|
$
|
(3,883
|
)
|
|
$
|
(649
|
)
|
|
$
|
—
|
|
|
$
|
1,136,539
|
|
Cost of sales
|
598,522
|
|
|
48,344
|
|
|
(1,638
|
)
|
|
(1,256
|
)
|
|
437
|
|
|
644,409
|
|
||||||
Gross profit
|
480,287
|
|
|
13,918
|
|
|
(2,245
|
)
|
|
607
|
|
|
(437
|
)
|
|
492,130
|
|
||||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Research and development and other engineering expense
|
43,056
|
|
|
4,546
|
|
|
(191
|
)
|
|
(340
|
)
|
|
(13
|
)
|
|
47,058
|
|
||||||
Selling expense
|
109,931
|
|
|
4,006
|
|
|
(1,044
|
)
|
|
(391
|
)
|
|
66
|
|
|
112,568
|
|
||||||
General and administrative expense
|
158,568
|
|
|
1,624
|
|
|
(3,995
|
)
|
|
52
|
|
|
1,025
|
|
|
157,274
|
|
||||||
Operating expenses
|
311,555
|
|
|
10,176
|
|
|
(5,230
|
)
|
|
(679
|
)
|
|
1,078
|
|
|
316,900
|
|
||||||
Net gain (loss) on disposal of assets
|
(10,579
|
)
|
|
(4,448
|
)
|
|
198
|
|
|
(12
|
)
|
|
8,817
|
|
|
(6,024
|
)
|
||||||
Impairment of goodwill
|
6,686
|
|
|
—
|
|
|
(6,686
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Income from operations
|
172,625
|
|
|
8,190
|
|
|
9,473
|
|
|
1,298
|
|
|
(10,332
|
)
|
|
181,254
|
|
||||||
Interest expense, net and other
|
(634
|
)
|
|
(1,451
|
)
|
|
(123
|
)
|
|
169
|
|
|
302
|
|
|
(1,737
|
)
|
||||||
Foreign exchange gain
|
137
|
|
|
(1,576
|
)
|
|
844
|
|
|
(1,041
|
)
|
|
476
|
|
|
(1,160
|
)
|
||||||
Income before income taxes
|
172,128
|
|
|
5,163
|
|
|
10,194
|
|
|
426
|
|
|
(9,554
|
)
|
|
178,357
|
|
||||||
Provision for income taxes
|
45,495
|
|
|
814
|
|
|
(1,013
|
)
|
|
463
|
|
|
(1,384
|
)
|
|
44,375
|
|
||||||
Net income
|
$
|
126,633
|
|
|
$
|
4,349
|
|
|
$
|
11,207
|
|
|
$
|
(37
|
)
|
|
$
|
(8,170
|
)
|
|
$
|
133,982
|
|
(in thousands)
|
North
America
|
|
Europe
|
|
Asia/
Pacific
|
|
Total
|
||||||||
December 31, 2018
|
$
|
910,587
|
|
|
$
|
159,027
|
|
|
$
|
9,195
|
|
|
$
|
1,078,809
|
|
December 31, 2019
|
972,849
|
|
|
155,144
|
|
|
8,546
|
|
|
1,136,539
|
|
||||
Increase (decrease)
|
$
|
62,262
|
|
|
$
|
(3,883
|
)
|
|
$
|
(649
|
)
|
|
$
|
57,730
|
|
Percentage increase (decrease)
|
6.8
|
%
|
|
(2.4
|
)%
|
|
(7.1
|
)%
|
|
5.4
|
%
|
|
North
America
|
|
Europe
|
|
Asia/
Pacific
|
|
Total
|
||||
Percentage of total 2018 net sales
|
84
|
%
|
|
15
|
%
|
|
1
|
%
|
|
100
|
%
|
Percentage of total 2019 net sales
|
86
|
%
|
|
14
|
%
|
|
—
|
%
|
|
100
|
%
|
(in thousands)
|
North
America
|
|
Europe
|
|
Asia/
Pacific
|
|
Admin &
All Other
|
|
Total
|
||||||||||
December 31, 2018
|
$
|
421,820
|
|
|
$
|
56,151
|
|
|
$
|
2,085
|
|
|
$
|
231
|
|
|
$
|
480,287
|
|
December 31, 2019
|
435,738
|
|
|
53,906
|
|
|
2,692
|
|
|
(206
|
)
|
|
492,130
|
|
|||||
Increase (decrease)
|
$
|
13,918
|
|
|
$
|
(2,245
|
)
|
|
$
|
607
|
|
|
$
|
(437
|
)
|
|
$
|
11,843
|
|
Percentage increase (decrease)
|
3.3
|
%
|
|
(4.0
|
)%
|
|
*
|
|
*
|
|
2.5
|
%
|
|
North
America
|
|
Europe
|
|
Asia/
Pacific
|
|
Admin &
All Other
|
|
Total
|
||||
2018 gross profit percentage
|
46.3
|
%
|
|
35.3
|
%
|
|
22.7
|
%
|
|
*
|
|
44.5
|
%
|
2019 gross profit percentage
|
44.8
|
%
|
|
34.7
|
%
|
|
31.5
|
%
|
|
*
|
|
43.3
|
%
|
•
|
Net sales increased 6.8% primarily due to increased sales volume and average unit price in the United States. Canada's net sales were negatively affected by approximately $1.2 million due to foreign currency translation. In local currency, Canada net sales increased primarily due to increases in sales volume.
|
•
|
Gross profit margin decreased to 44.8% from 46.3%, primarily due to increased raw material and labor costs.
|
•
|
Research and development and engineering expense increased $4.5 million, primarily due to increases of $5.0 million in personnel costs, which was mostly due to moving certain employees, whose primary responsibilities changed during 2019, from general and administrative to research and development and engineering. This was partly offset by decreases of $0.5 million in cash profit sharing expense and $0.3 million in stock-based compensation.
|
•
|
Selling expense increased $4.0 million, primarily due to increases of $5.5 million in personnel costs, $0.6 million in advertising and promotional costs and $0.5 million in professional fees, which was partly offset by decreases of $1.7 million in sales and agent commissions.
|
•
|
General and administrative expense increased $1.6 million, primarily due to increases of $1.7 million in personnel costs, $1.0 million in computer costs including software subscription and licensing fees, $0.9 million in facilities expense and $0.5 million in bad debt expense, which was partly offset by decreases of $1.8 million in consulting and legal expenses and $0.9 million in cash profit sharing expense. Included in general and administrative expense are costs associated with the SAP implementation of $10.5 million, an increase of $2.9 million over the prior year.
|
•
|
Gain on sale of assets - In November 2019, the Company sold a sales and distribution facility. The Company received proceeds net of closing costs of $9.4 million, which resulted in a gain of $5.6 million.
|
•
|
Income from operations increased $8.2 million, mostly due to higher net sales and a gain on sale of assets, which was partially offset by higher operating expenses.
|
•
|
Net sales decreased 2.4%, primarily due to approximately $9.2 million of negative foreign currency translations resulting from some Europe currencies weakening against the United States dollar. In local currency, Europe net sales increased primarily due to increases in both sales volume and average product prices.
|
•
|
Gross profit margin decreased to 34.7% from 35.3%, primarily due to increased factory and overhead, labor and warehouse costs.
|
•
|
Selling expense decreased $1.0 million primarily due to decreases of $0.4 million in personnel costs, $0.4 million in cash profit sharing expense and $0.2 million in sales and agent commission expense.
|
•
|
General and administrative expense decreased $4.0 million, primarily due to decreases of $1.9 million in severance expense, $1.1 million in personnel expense, $0.4 million in cash profit sharing expense and $0.3 million in consulting and legal expenses. Included in general and administrative expense are costs associated with the SAP implementation of $2.4 million, an increase of $0.5 million over the prior year quarter. These expenses were primarily for professional fees.
|
•
|
Impairment of goodwill - The impairment charge of $6.7 million taken in 2018 was associated with assets acquired in Denmark in 2001, and as a result, the goodwill of the Denmark reporting unit was fully impaired. See “Critical Accounting Policies and Estimates — Goodwill Impairment Testing."
|
•
|
Income from operations increased $9.5 million, mostly due to a non-recurring $6.7 million impairment of goodwill taken in 2018 and decreased operating expenses.
|
•
|
For information about the Company’s Asia/Pacific segment, please refer to the table above setting forth changes in our operating results for the years ended December 31, 2019 and 2018.
|
•
|
General and administrative expense increased $1.0 million, primarily due to increases of $1.5 million in personal expense as well as a $0.6 million reduction of rental income, net of expenses, which was partly offset by a decrease of $0.7 million in cash profit sharing expense.
|
•
|
Gain on sale of assets - In November 2018, the Company sold a facility that was previously leased exclusively to a third party. The Company received net proceeds of $17.5 million, which resulted in a gain of $8.8 million.
|
|
|
|
Increase (Decrease) in Operating Segment
|
|
|
||||||||||||||||||
|
|
|
North America
|
|
|
|
Asia/
Pacific
|
|
Admin &
All Other
|
|
|
||||||||||||
(in thousands)
|
2017
|
|
|
Europe
|
|
|
|
2018
|
|||||||||||||||
Net sales
|
$
|
977,025
|
|
|
$
|
106,891
|
|
|
$
|
(6,128
|
)
|
|
$
|
1,021
|
|
|
$
|
—
|
|
|
$
|
1,078,809
|
|
Cost of sales
|
533,644
|
|
|
68,352
|
|
|
(3,307
|
)
|
|
(93
|
)
|
|
(74
|
)
|
|
598,522
|
|
||||||
Gross profit
|
443,381
|
|
|
38,539
|
|
|
(2,821
|
)
|
|
1,115
|
|
|
74
|
|
|
480,287
|
|
||||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Research and development and other engineering expense
|
47,616
|
|
|
(3,728
|
)
|
|
(1,167
|
)
|
|
244
|
|
|
91
|
|
|
43,056
|
|
||||||
Selling expense
|
114,903
|
|
|
(1,418
|
)
|
|
(3,917
|
)
|
|
169
|
|
|
194
|
|
|
109,931
|
|
||||||
General and administrative expense
|
142,749
|
|
|
12,919
|
|
|
2,195
|
|
|
187
|
|
|
518
|
|
|
158,568
|
|
||||||
Operating expenses
|
305,268
|
|
|
7,773
|
|
|
(2,889
|
)
|
|
600
|
|
|
803
|
|
|
311,555
|
|
||||||
Net gain (loss) on disposal of assets
|
(160
|
)
|
|
(1,009
|
)
|
|
(624
|
)
|
|
32
|
|
|
(8,818
|
)
|
|
(10,579
|
)
|
||||||
Impairment of goodwill
|
—
|
|
|
—
|
|
|
6,686
|
|
|
—
|
|
|
—
|
|
|
6,686
|
|
||||||
Income from operations
|
138,273
|
|
|
31,775
|
|
|
(5,994
|
)
|
|
482
|
|
|
8,089
|
|
|
172,625
|
|
||||||
Interest income (expense), net and other
|
(874
|
)
|
|
(318
|
)
|
|
126
|
|
|
(185
|
)
|
|
617
|
|
|
(634
|
)
|
||||||
Foreign exchange gain (loss), net
|
894
|
|
|
2,042
|
|
|
(2,781
|
)
|
|
424
|
|
|
(442
|
)
|
|
137
|
|
||||||
Gain on bargain purchase of a business
|
6,336
|
|
|
—
|
|
|
(6,336
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Loss on disposal of a business
|
(211
|
)
|
|
—
|
|
|
211
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Income before income taxes
|
144,418
|
|
|
33,499
|
|
|
(14,774
|
)
|
|
721
|
|
|
8,264
|
|
|
172,128
|
|
||||||
Provision for income taxes
|
51,801
|
|
|
(7,796
|
)
|
|
822
|
|
|
(305
|
)
|
|
973
|
|
|
45,495
|
|
||||||
Net income
|
$
|
92,617
|
|
|
$
|
41,295
|
|
|
$
|
(15,596
|
)
|
|
$
|
1,026
|
|
|
$
|
7,291
|
|
|
$
|
126,633
|
|
(in thousands)
|
North
America
|
|
Europe
|
|
Asia/
Pacific
|
|
Total
|
||||||||
December 31, 2017
|
$
|
803,697
|
|
|
$
|
165,155
|
|
|
$
|
8,173
|
|
|
$
|
977,025
|
|
December 31, 2018
|
910,588
|
|
|
159,027
|
|
|
9,195
|
|
|
1,078,809
|
|
||||
Increase (decrease)
|
$
|
106,891
|
|
|
$
|
(6,128
|
)
|
|
$
|
1,022
|
|
|
$
|
101,784
|
|
Percentage increase (decrease)
|
13.3
|
%
|
|
(3.7
|
)%
|
|
12.5
|
%
|
|
10.4
|
%
|
|
North
America
|
|
Europe
|
|
Asia/
Pacific
|
|
Total
|
||||
Percentage of total 2017 net sales
|
82
|
%
|
|
17
|
%
|
|
1
|
%
|
|
100
|
%
|
Percentage of total 2018 net sales
|
84
|
%
|
|
15
|
%
|
|
1
|
%
|
|
100
|
%
|
(in thousands)
|
North
America
|
|
Europe
|
|
Asia/
Pacific
|
|
Admin &
All Other
|
|
Total
|
||||||||||
December 31, 2017
|
$
|
383,282
|
|
|
$
|
58,973
|
|
|
$
|
971
|
|
|
$
|
155
|
|
|
$
|
443,381
|
|
December 31, 2018
|
421,821
|
|
|
56,152
|
|
|
2,085
|
|
|
229
|
|
|
480,287
|
|
|||||
Increase (decrease)
|
$
|
38,539
|
|
|
$
|
(2,821
|
)
|
|
$
|
1,114
|
|
|
$
|
74
|
|
|
$
|
36,906
|
|
Percentage increase (decrease)
|
10.1
|
%
|
|
(4.8
|
)%
|
|
*
|
|
*
|
|
8.3
|
%
|
|
North
America
|
|
Europe
|
|
Asia/
Pacific
|
|
Admin &
All Other
|
|
Total
|
||||
2017 gross profit percentage
|
47.7
|
%
|
|
35.7
|
%
|
|
11.9
|
%
|
|
*
|
|
45.4
|
%
|
2018 gross profit percentage
|
46.3
|
%
|
|
35.3
|
%
|
|
22.7
|
%
|
|
*
|
|
44.5
|
%
|
•
|
Net sales increased 13.3% primarily due to higher sales volume and average unit price in the United States. Canada's net sales increased primarily due to increased sales volumes and were not significantly affected by foreign currency translation.
|
•
|
Gross profit margin decreased to 46.3% from 47.7%, primarily due to increased material, labor and shipping costs, as a percentage of net sales, partly offset by decreased factory and overhead costs as a percentage of net sales.
|
•
|
Research and development and engineering expense decreased $3.7 million primarily due to decreases of $2.1 million in personnel costs, $0.5 million in severance expense, $0.5 million in cash profit sharing expense and $0.4 million in professional fees.
|
•
|
Selling expense decreased $1.4 million, primarily due to decreases of $1.7 million in advertising expense, $0.8 million in stock-based compensation expense, $0.8 million in severance expense and $0.3 million in personnel costs, partly offset by an increase of $1.6 million in sales and agent commissions.
|
•
|
General and administrative expense increased $12.9 million, primarily due to increases of $13.9 million in consulting and legal expenses, $3.3 million in depreciation expense, $1.1 million mostly in software subscription, licensing, maintenance and hosting fees and $0.2 million in bad debt expense, partly offset by decreases of $1.8 million in severance expense, $1.7 million in stock-based compensation and $1.1 million in personnel costs. Included in general and administrative expense are costs associated with the SAP implementation of $6.4 million, an increase of $4.1 million over the prior year quarter. These expenses were primarily for professional fees.
|
•
|
Income from operations increased $31.5 million, mostly due to increased gross profit, which were partially offset by higher operating expenses. Severance expenses of $3.6 million were recorded in 2017.
|
•
|
Net sales decreased 3.7% primarily due to reduced sales volume as a result of the late 2017 sale of Gbo Fastening Systems' Poland and Romania subsidiaries (acquired in January 2017), which contributed $12.8 million in net sales for the year ended December 31, 2017. Net sales were positively affected by approximately $4.9 million in foreign currency translations, primarily related to the strengthening of the Euro, British pound, Danish Kroner and Polish zloty against the United States dollar.
|
•
|
Gross profit margin decreased to 35.3% from 35.7% primarily due to increased factory and overhead and warehousing costs, partly offset by decreased material and labor costs.
|
•
|
Research and development and engineering expense decreased $1.2 million primarily due to decreases of $0.5 million in personnel costs and $0.5 million in severance expenses, partly offset by an increase of $0.2 million in professional fees.
|
•
|
Selling expense decreased $3.9 million primarily due to decreases of $2.2 million in personnel costs, $1.2 million in severance expenses, $0.4 million mostly for advertising costs and $0.2 million in stock-based compensation expense.
|
•
|
General and administrative expense increased $1.9 million primarily due to increases of $2.5 million in personnel costs, including $1.7 million in severance expense, $0.5 million in amortization expenses and $0.2 million in bad debt expense, partly offset by decreases of $1.1 million of consulting fees and $0.5 million mostly for software subscription, licensing, maintenance and hosting fees. Included in general and administrative expense are costs associated with the SAP implementation of $1.9 million, an increase of $0.8 million over the prior year quarter. These expenses were primarily for professional fees.
|
•
|
Impairment of goodwill - The impairment charge of $6.7 million taken in the fourth quarter of 2018 was associated with assets acquired in Denmark in 2001, and as a result, the goodwill of the Denmark reporting unit was fully impaired. The impairment resulted from a reduction in expected future operating profits of the reporting unit, but not for Europe as a whole. The Company’s 2018 annual goodwill impairment analysis did not result in additional impairment of goodwill for other reporting units. See “Critical Accounting Policies and Estimates — Goodwill Impairment Testing."
|
•
|
Income from operations decreased $5.8 million, mostly due to a $6.7 million impairment of goodwill.
|
•
|
For information about the Company’s Asia/Pacific segment, please refer to the table above setting forth changes in our operating results for the years ended December 31, 2018 and 2017.
|
•
|
Gain on sale of assets - In November 2018, the Company sold a facility that was previously leased exclusively to a third party. The Company received net proceeds of $17.5 million, which resulted in a gain of $8.8 million.
|
•
|
Raw materials and purchased finished goods — principally valued at cost determined on a weighted average basis; and
|
•
|
In-process products and finished goods — cost of direct materials and labor plus attributable overhead based on a normal level of activity.
|
|
|
At December 31,
|
||||||||||
(in thousands)
|
|
2019
|
|
2018
|
|
2017
|
||||||
|
|
|
|
|
|
|
||||||
Cash and cash equivalents
|
|
$
|
230,210
|
|
|
$
|
160,180
|
|
|
$
|
168,514
|
|
Property, plant and equipment, net
|
|
249,012
|
|
|
254,597
|
|
|
273,020
|
|
|||
Equity investment, goodwill and intangible assets
|
|
159,430
|
|
|
157,139
|
|
|
169,015
|
|
|||
Working capital
|
|
482,000
|
|
|
447,949
|
|
|
447,450
|
|
|
|
Years Ended December 31,
|
||||||||||
(in thousands)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Net cash provided by (used in):
|
|
|
|
|
|
|
||||||
Operating activities
|
|
$
|
205,662
|
|
|
$
|
160,080
|
|
|
$
|
119,065
|
|
Investing activities
|
|
(28,021
|
)
|
|
(10,249
|
)
|
|
(75,815
|
)
|
|||
Financing activities
|
|
(108,154
|
)
|
|
(155,393
|
)
|
|
(106,671
|
)
|
•
|
Our asset acquisitions, net of cash acquired and proceeds from sales of businesses, in 2017, 2018 and 2019 were $27.9 million, $2.0 million and $2.7 million, respectively. In January 2017, we acquired Gbo Fastening Systems for approximately $10.2 million, and sold two of its subsidiaries in late 2017 for approximately $9.5 million, retaining the Gbo Fastening Systems operations in Sweden and Norway for less than $1.0 million in cash. Also in January 2017, we acquired CG Visions for approximately $20.8 million. The acquisitions in 2018 and 2019 were to extend product lines and acquire intellectual property.
|
•
|
Our capital spending in 2017, 2018 and 2019 was $58.0 million, $29.3 million and $32.7 million, respectively, which was primarily used for real estate improvements, machinery and equipment purchases and software in development. Also in 2019, we purchased intellectual property of $4.8 million. Based on current information and subject to future events and circumstances, we estimate that our full-year 2020 capital spending will be approximately $40 million to $43 million, including $7 to $10 million on maintenance type capital expenditures, assuming all such projects will be completed by the end of 2020. Based on current information and subject to future events and circumstances, we estimate that our full-year 2020 depreciation and amortization expense to be approximately $39 million to $41 million, of which approximately $33 million to $35 million is related to depreciation.
|
•
|
In April 2019, our Board of Directors raised the quarterly cash dividend by 4.5% to $0.23 per share. On January 21, 2020, the Board declared a cash dividend of $0.23 per share, estimated to be $10.1 million in total. Such dividend is scheduled to be paid on April 23, 2020, to stockholders of record on April 2, 2020.
|
•
|
For 2019, we purchased and received 972,337 shares of the Company’s common stock on the open market at an average price of $62.55 per share, for a total of $60.8 million under a previously announced $100.0 million share repurchase authorization (which expired at the end of 2019).
|
•
|
In total, as illustrated in the table below, we have repurchased over six million shares of the Company’s common stock, which represents approximately 13.6% of our shares of common stock outstanding at the beginning of 2015. Including dividends, we have returned cash of $521.2 million, which represents 74.3% of our total cash flow from operations during the same period.
|
•
|
On December 9, 2019, our Board of Directors authorized the Company to repurchase up to $100.0 million of the Company’s common stock. The authorization is in effect from January 1, 2019 through December 31, in 2019.
|
(in thousands)
|
Number of Shares Repurchased
|
|
Cash Paid for Repurchases
|
|
Cash Paid for Dividends
|
|
Total
|
|||||||
January 1 - December 31, 2019
|
972
|
|
|
$
|
60,816
|
|
|
$
|
40,258
|
|
|
$
|
101,074
|
|
January 1 - December 31, 2018
|
1,955
|
|
|
110,540
|
|
|
39,891
|
|
|
150,431
|
|
|||
January 1 - December 31, 2017
|
1,138
|
|
|
70,000
|
|
|
36,981
|
|
|
106,981
|
|
|||
January 1 - December 31, 2016
|
1,244
|
|
|
53,502
|
|
|
32,711
|
|
|
86,213
|
|
|||
January 1 - December 31, 2015
|
1,339
|
|
|
47,144
|
|
|
29,352
|
|
|
76,496
|
|
|||
Total
|
6,648
|
|
|
$
|
342,002
|
|
|
$
|
179,193
|
|
|
$
|
521,195
|
|
|
Payments Due by Period
|
||||||||||||||
|
Total
all
periods
|
Less
than 1
year
|
1 — 3
years
|
3 — 5
years
|
More
than 5
years
|
||||||||||
|
|||||||||||||||
Contractual Obligation (in thousands)
|
|||||||||||||||
Long-term debt interest obligations (1)
|
$
|
675
|
|
$
|
450
|
|
$
|
225
|
|
$
|
—
|
|
$
|
—
|
|
Operating lease obligations, including imputed interest (2)
|
35,322
|
|
9,425
|
|
13,812
|
|
7,254
|
|
4,831
|
|
|||||
Capital lease obligations, including imputed interest(3)
|
1,511
|
|
1,160
|
|
351
|
|
—
|
|
—
|
|
|||||
Purchase obligations (4)
|
51,449
|
|
50,187
|
|
1,262
|
|
|
|
—
|
|
|||||
Total
|
$
|
88,957
|
|
$
|
61,222
|
|
$
|
15,650
|
|
$
|
7,254
|
|
$
|
4,831
|
|
Consolidated financial statements
|
|
|
|
Financial Statement Schedule
|
|
•
|
We tested the design and operating effectiveness of controls related to the calculation of the net realizable value of inventory, including controls over the review of the demand forecast.
|
•
|
We tested the completeness and accuracy of the underlying data used in the calculation of net realizable value.
|
•
|
We evaluated the reasonableness of management’s demand forecasts by performing the following:
|
◦
|
Compared prior year forecasts with actual results to evaluate management’s ability to estimate future demand.
|
◦
|
Assessed forecasted demand for consistency with evidence obtained in other areas of the audit.
|
◦
|
Performed a sensitivity analysis on demand assumptions to determine the impact on the net realizable value.
|
•
|
We recalculated and assessed the appropriateness of the formulaic calculation and management adjustments by making inquiries of management and various individuals outside of the accounting team to obtain support for selected adjustments and obtain supporting documentation when applicable.
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
ASSETS
|
|
|
|
|
|
||
Current assets
|
|
|
|
|
|
||
Cash and cash equivalents
|
$
|
230,210
|
|
|
$
|
160,180
|
|
Trade accounts receivable, net
|
139,364
|
|
|
146,052
|
|
||
Inventories
|
251,907
|
|
|
276,088
|
|
||
Other current assets
|
19,426
|
|
|
17,209
|
|
||
Total current assets
|
640,907
|
|
|
599,529
|
|
||
Property, plant and equipment, net
|
249,012
|
|
|
254,597
|
|
||
Goodwill
|
131,879
|
|
|
130,250
|
|
||
Operating lease right-of-use assets
|
35,436
|
|
|
—
|
|
||
Equity investment (see Note 11)
|
2,480
|
|
|
2,487
|
|
||
Intangible assets, net
|
25,071
|
|
|
24,402
|
|
||
Other noncurrent assets
|
10,581
|
|
|
10,398
|
|
||
Total assets
|
$
|
1,095,366
|
|
|
$
|
1,021,663
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Trade accounts payable
|
$
|
33,351
|
|
|
$
|
34,361
|
|
Accrued liabilities and other current liabilities
|
125,556
|
|
|
117,219
|
|
||
Total current liabilities
|
158,907
|
|
|
151,580
|
|
||
Operating lease liabilities, net of current portion
|
27,930
|
|
|
—
|
|
||
Deferred income tax and other long-term liabilities
|
16,572
|
|
|
14,569
|
|
||
Total liabilities
|
203,409
|
|
|
166,149
|
|
||
Commitments and contingencies (see Note 14)
|
|
|
|
|
|
||
Stockholders’ equity
|
|
|
|
||||
Preferred stock, par value $0.01; authorized shares, 5,000; issued and outstanding shares, none
|
—
|
|
|
—
|
|
||
Common stock, par value $0.01; authorized shares, 160,000; issued and outstanding shares, 44,209, and 44,998 at December 31, 2019 and 2018, respectively
|
442
|
|
|
453
|
|
||
Additional paid-in capital
|
280,216
|
|
|
276,504
|
|
||
Retained earnings
|
645,507
|
|
|
628,207
|
|
||
Treasury stock
|
(9,379
|
)
|
|
(25,000
|
)
|
||
Accumulated other comprehensive loss
|
(24,829
|
)
|
|
(24,650
|
)
|
||
Total stockholders’ equity
|
891,957
|
|
|
855,514
|
|
||
Total liabilities and stockholders’ equity
|
$
|
1,095,366
|
|
|
$
|
1,021,663
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Net sales
|
$
|
1,136,539
|
|
|
$
|
1,078,809
|
|
|
$
|
977,025
|
|
Cost of sales
|
644,409
|
|
|
598,522
|
|
|
533,644
|
|
|||
Gross profit
|
492,130
|
|
|
480,287
|
|
|
443,381
|
|
|||
Operating expenses:
|
|
|
|
|
|
|
|
|
|||
Research and development and other engineering
|
47,058
|
|
|
43,056
|
|
|
47,616
|
|
|||
Selling
|
112,568
|
|
|
109,931
|
|
|
114,903
|
|
|||
General and administrative
|
157,274
|
|
|
158,568
|
|
|
142,749
|
|
|||
Total operating expenses
|
316,900
|
|
|
311,555
|
|
|
305,268
|
|
|||
Net gain on disposal of assets
|
(6,024
|
)
|
|
(10,579
|
)
|
|
(160
|
)
|
|||
Impairment of goodwill
|
—
|
|
|
6,686
|
|
|
—
|
|
|||
Income from operations
|
181,254
|
|
|
172,625
|
|
|
138,273
|
|
|||
Interest income (expense), net and other
|
(1,737
|
)
|
|
(634
|
)
|
|
(874
|
)
|
|||
Foreign exchange gain (loss), net
|
(1,160
|
)
|
|
137
|
|
|
894
|
|
|||
Gain on bargain purchase of a business
|
—
|
|
|
—
|
|
|
6,336
|
|
|||
Loss on disposal of a business
|
—
|
|
|
—
|
|
|
(211
|
)
|
|||
Income before taxes
|
178,357
|
|
|
172,128
|
|
|
144,418
|
|
|||
Provision for income taxes
|
44,375
|
|
|
45,495
|
|
|
51,801
|
|
|||
Net income
|
$
|
133,982
|
|
|
$
|
126,633
|
|
|
$
|
92,617
|
|
Other comprehensive income
|
|
|
|
|
|
||||||
Translation adjustment, net of tax expense
|
885
|
|
|
(12,911
|
)
|
|
21,418
|
|
|||
Unamortized pension adjustments, net of tax benefit (expense) of ($0), ($59) and $37, for 2019, 2018 and 2017, respectively
|
(1,064
|
)
|
|
376
|
|
|
(944
|
)
|
|||
Comprehensive income
|
$
|
133,803
|
|
|
$
|
114,098
|
|
|
$
|
113,091
|
|
|
|
|
|
|
|
||||||
Basic
|
$
|
3.00
|
|
|
$
|
2.74
|
|
|
$
|
1.95
|
|
Diluted
|
$
|
2.98
|
|
|
$
|
2.72
|
|
|
$
|
1.94
|
|
Weighted average number of shares of common stock outstanding
|
|
|
|
|
|
|
|
|
|||
Basic
|
44,735
|
|
|
46,213
|
|
|
47,486
|
|
|||
Diluted
|
44,921
|
|
|
46,540
|
|
|
47,774
|
|
|
|
|
Additional
Paid-in Capital |
|
Accumulated
Other Comprehensive Income (Loss) |
|
|
|||||||||||||
|
Common Stock
|
Retained
Earnings |
Treasury
Stock |
|
||||||||||||||||
|
Shares
|
Par Value
|
Total
|
|||||||||||||||||
Balance at January 1, 2017
|
47,437
|
|
$
|
473
|
|
$
|
255,917
|
|
$
|
642,422
|
|
$
|
(32,970
|
)
|
—
|
|
$
|
865,842
|
|
|
Net income
|
—
|
|
—
|
|
—
|
|
92,617
|
|
—
|
|
—
|
|
92,617
|
|
||||||
Translation adjustment, net of tax
|
—
|
|
—
|
|
—
|
|
—
|
|
21,418
|
|
—
|
|
21,418
|
|
||||||
Pension adjustment, net of tax
|
—
|
|
—
|
|
—
|
|
—
|
|
(944
|
)
|
—
|
|
(944
|
)
|
||||||
Options exercised
|
223
|
|
3
|
|
6,607
|
|
—
|
|
—
|
|
—
|
|
6,610
|
|
||||||
Stock-based compensation expense
|
—
|
|
—
|
|
12,565
|
|
—
|
|
—
|
|
—
|
|
12,565
|
|
||||||
Repurchase of common stock
|
(1,138
|
)
|
—
|
|
(10,000
|
)
|
—
|
|
—
|
|
(60,000
|
)
|
(70,000
|
)
|
||||||
Retirement of common stock
|
|
|
(5
|
)
|
—
|
|
(19,995
|
)
|
|
|
20,000
|
|
—
|
|
||||||
Cash dividends declared on common stock, $0.81per share
|
—
|
|
—
|
|
—
|
|
(38,400
|
)
|
—
|
|
—
|
|
(38,400
|
)
|
||||||
Shares issued from release of restricted stock units
|
214
|
|
2
|
|
(5,343
|
)
|
—
|
|
—
|
|
—
|
|
(5,341
|
)
|
||||||
Common stock issued at $44.26 per share
|
9
|
|
—
|
|
411
|
|
—
|
|
—
|
|
—
|
|
411
|
|
||||||
Balance at December 31, 2017
|
46,745
|
|
473
|
|
260,157
|
|
676,644
|
|
(12,496
|
)
|
(40,000
|
)
|
884,778
|
|
||||||
Net income
|
—
|
|
—
|
|
—
|
|
126,633
|
|
—
|
|
|
|
126,633
|
|
||||||
Translation adjustment, net of tax
|
—
|
|
—
|
|
—
|
|
—
|
|
(12,911
|
)
|
—
|
|
(12,911
|
)
|
||||||
Pension adjustment, net of tax
|
—
|
|
—
|
|
—
|
|
—
|
|
376
|
|
—
|
|
376
|
|
||||||
Adoption of new accounting standards
|
—
|
|
—
|
|
—
|
|
410
|
|
381
|
|
—
|
|
791
|
|
||||||
Options exercised
|
23
|
|
—
|
|
695
|
|
—
|
|
—
|
|
—
|
|
695
|
|
||||||
Stock-based compensation expense
|
—
|
|
—
|
|
10,334
|
|
—
|
|
—
|
|
—
|
|
10,334
|
|
||||||
Repurchase of common stock
|
(1,955
|
)
|
—
|
|
10,000
|
|
—
|
|
—
|
|
(120,540
|
)
|
(110,540
|
)
|
||||||
Retirement of common stock
|
—
|
|
(22
|
)
|
—
|
|
(135,518
|
)
|
—
|
|
135,540
|
|
—
|
|
||||||
Cash dividends declared on common stock, $0.87 per share
|
—
|
|
—
|
|
—
|
|
(39,962
|
)
|
—
|
|
—
|
|
(39,962
|
)
|
||||||
Shares issued from release of restricted stock units
|
177
|
|
2
|
|
(5,147
|
)
|
—
|
|
—
|
|
—
|
|
(5,145
|
)
|
||||||
Common stock issued at $57.41 per share
|
8
|
|
—
|
|
465
|
|
—
|
|
—
|
|
—
|
|
465
|
|
||||||
Balance at December 31, 2018
|
44,998
|
|
453
|
|
276,504
|
|
628,207
|
|
(24,650
|
)
|
(25,000
|
)
|
855,514
|
|
||||||
Net income
|
—
|
|
—
|
|
—
|
|
133,982
|
|
—
|
|
|
|
133,982
|
|
||||||
Translation adjustment, net of tax
|
—
|
|
—
|
|
—
|
|
—
|
|
885
|
|
—
|
|
885
|
|
||||||
Pension adjustment, net of tax
|
—
|
|
—
|
|
—
|
|
—
|
|
(1,064
|
)
|
—
|
|
(1,064
|
)
|
||||||
Stock-based compensation expense
|
—
|
|
—
|
|
9,325
|
|
—
|
|
—
|
|
—
|
|
9,325
|
|
||||||
Repurchase of common stock
|
(972
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
(60,816
|
)
|
(60,816
|
)
|
||||||
Retirement of common stock
|
—
|
|
(13
|
)
|
—
|
|
(76,424
|
)
|
—
|
|
76,437
|
|
—
|
|
||||||
Cash dividends declared on common stock, $0.91 per share
|
—
|
|
—
|
|
—
|
|
(40,258
|
)
|
—
|
|
—
|
|
(40,258
|
)
|
||||||
Shares issued from release of restricted stock units
|
178
|
|
2
|
|
(5,905
|
)
|
—
|
|
—
|
|
—
|
|
(5,903
|
)
|
||||||
Common stock issued at $54.31 per share
|
5
|
|
—
|
|
292
|
|
—
|
|
—
|
|
—
|
|
292
|
|
||||||
Balance at December 31, 2019
|
44,209
|
|
$
|
442
|
|
$
|
280,216
|
|
$
|
645,507
|
|
$
|
(24,829
|
)
|
$
|
(9,379
|
)
|
$
|
891,957
|
|
|
|||||||||||
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Cash flows from operating activities
|
|
|
|
|
|
|
|
|
|||
Net income
|
$
|
133,982
|
|
|
$
|
126,633
|
|
|
$
|
92,617
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
|
|
|||
Gain (loss) on sale of assets and other
|
(6,023
|
)
|
|
(10,516
|
)
|
|
602
|
|
|||
Depreciation and amortization
|
38,402
|
|
|
39,393
|
|
|
33,724
|
|
|||
Noncash lease expense
|
7,136
|
|
|
—
|
|
|
—
|
|
|||
Gain on bargain purchase of a business
|
—
|
|
|
—
|
|
|
(6,336
|
)
|
|||
Loss on disposal of a business
|
—
|
|
|
—
|
|
|
211
|
|
|||
Impairment of goodwill
|
—
|
|
|
6,686
|
|
|
—
|
|
|||
Deferred income taxes
|
2,557
|
|
|
4,950
|
|
|
6,299
|
|
|||
Noncash compensation related to stock plans
|
10,434
|
|
|
11,176
|
|
|
13,908
|
|
|||
Provision of doubtful accounts
|
977
|
|
|
569
|
|
|
66
|
|
|||
Foreign exchange gain
|
—
|
|
|
(1,841
|
)
|
|
—
|
|
|||
Changes in operating assets and liabilities, net of effects of acquisitions and dispositions:
|
|
|
|
|
|
|
|
|
|||
Trade accounts receivable
|
6,096
|
|
|
(12,573
|
)
|
|
(17,822
|
)
|
|||
Inventories
|
23,655
|
|
|
(26,425
|
)
|
|
(6,580
|
)
|
|||
Other current assets
|
(3,808
|
)
|
|
5,297
|
|
|
(2,016
|
)
|
|||
Trade accounts payable
|
(845
|
)
|
|
4,670
|
|
|
1,157
|
|
|||
Accrued liabilities and other current liabilities
|
(145
|
)
|
|
13,804
|
|
|
3,440
|
|
|||
Other noncurrent assets and liabilities
|
(6,756
|
)
|
|
(1,743
|
)
|
|
(205
|
)
|
|||
Net cash provided by operating activities
|
205,662
|
|
|
160,080
|
|
|
119,065
|
|
|||
Cash flows from investing activities
|
|
|
|
|
|
|
|
|
|||
Capital expenditures
|
(32,699
|
)
|
|
(29,310
|
)
|
|
(58,041
|
)
|
|||
Acquisitions, net of cash acquired
|
(2,650
|
)
|
|
(2,007
|
)
|
|
(27,921
|
)
|
|||
Purchases of intangible assets
|
(4,827
|
)
|
|
—
|
|
|
—
|
|
|||
Proceeds from sale of property and equipment
|
12,155
|
|
|
21,068
|
|
|
681
|
|
|||
Proceeds from sale of a business
|
—
|
|
|
—
|
|
|
9,466
|
|
|||
Net cash used in investing activities
|
(28,021
|
)
|
|
(10,249
|
)
|
|
(75,815
|
)
|
|||
Cash flows from financing activities
|
|
|
|
|
|
|
|
|
|||
Proceeds from line of credits
|
16,647
|
|
|
—
|
|
|
—
|
|
|||
Repayments of line of credit and capital leases
|
(17,883
|
)
|
|
(147
|
)
|
|
(754
|
)
|
|||
Deferred and contingent consideration paid for acquisitions
|
—
|
|
|
(364
|
)
|
|
(205
|
)
|
|||
Repurchase of common stock
|
(60,816
|
)
|
|
(110,540
|
)
|
|
(70,000
|
)
|
|||
Issuance of Company’s common stock
|
—
|
|
|
695
|
|
|
6,610
|
|
|||
Dividends paid
|
(40,197
|
)
|
|
(39,891
|
)
|
|
(36,981
|
)
|
|||
Cash paid on behalf of employees for shares withheld
|
(5,905
|
)
|
|
(5,146
|
)
|
|
(5,341
|
)
|
|||
Net cash used in financing activities
|
(108,154
|
)
|
|
(155,393
|
)
|
|
(106,671
|
)
|
|||
Effect of exchange rate changes on cash
|
543
|
|
|
(2,772
|
)
|
|
5,398
|
|
|||
Net decrease in cash and cash equivalents
|
70,030
|
|
|
(8,334
|
)
|
|
(58,023
|
)
|
|||
Cash and cash equivalents at beginning of year
|
160,180
|
|
|
168,514
|
|
|
226,537
|
|
|||
Cash and cash equivalents at end of year
|
$
|
230,210
|
|
|
$
|
160,180
|
|
|
$
|
168,514
|
|
Supplemental Disclosure of Cash Flow Information
|
|||||||||||
Cash paid during the year for
|
|
|
|
|
|
|
|
|
|||
Interest
|
$
|
143
|
|
|
$
|
160
|
|
|
$
|
121
|
|
Income taxes
|
37,730
|
|
|
40,123
|
|
|
50,832
|
|
|||
Noncash activity during the year for
|
|
|
|
|
|
|
|
|
|||
Noncash capital expenditures
|
$
|
557
|
|
|
$
|
908
|
|
|
$
|
1,533
|
|
Capital lease obligations
|
—
|
|
|
—
|
|
|
3,750
|
|
|||
Contingent consideration for acquisition
|
—
|
|
|
—
|
|
|
1,314
|
|
|||
Issuance of Company’s common stock for compensation
|
292
|
|
|
465
|
|
|
411
|
|
|||
Dividends declared but not paid
|
10,170
|
|
|
9,988
|
|
|
9,954
|
|
1.
|
Operations and Summary of Significant Accounting Policies
|
•
|
Raw materials and purchased finished goods for resale — principally valued at a cost determined on a weighted average basis; and
|
•
|
In-process products and finished goods — the cost of direct materials and labor plus attributable overhead based on a normal level of activity.
|
2.
|
Revenue from Contracts with Customers
|
•
|
Wood Construction Products Revenue. Wood construction products represented almost 84% and 85% of total net sales in the year ended December 31, 2019 and 2018.
|
•
|
Concrete Construction Products Revenue. Concrete construction products represented 16% and 15% of total net sales in the year ended December 31, 2019 and 2018.
|
3.
|
Net Income per Share
|
|
For the Year Ended December 31,
|
||||||||||
(in thousands, except per-share amounts)
|
2019
|
|
2018
|
|
2017
|
||||||
Net income available to common stockholders
|
$
|
133,982
|
|
|
$
|
126,633
|
|
|
$
|
92,617
|
|
|
|
|
|
|
|
||||||
Basic weighted average shares outstanding
|
44,735
|
|
|
46,213
|
|
|
47,486
|
|
|||
Dilutive effect of potential common stock equivalents
|
186
|
|
|
327
|
|
|
288
|
|
|||
Diluted weighted average shares outstanding
|
44,921
|
|
|
46,540
|
|
|
47,774
|
|
|||
Net earnings per share:
|
|
|
|
|
|
|
|
|
|||
Basic
|
$
|
3.00
|
|
|
$
|
2.74
|
|
|
$
|
1.95
|
|
Diluted
|
$
|
2.98
|
|
|
$
|
2.72
|
|
|
$
|
1.94
|
|
4.
|
Stockholders' Equity
|
|
Foreign Currency Translation
|
|
Pension Benefit
|
|
Total
|
||||||
(in thousands)
|
|
|
|||||||||
Balance at January 1, 2017
|
$
|
(31,472
|
)
|
|
$
|
(1,498
|
)
|
|
$
|
(32,970
|
)
|
Other comprehensive loss net of tax benefit (expense) of ($0) and $37, respectively
|
21,273
|
|
|
(944
|
)
|
|
20,329
|
|
|||
Amounts reclassified from accumulative other comprehensive income, net of $0 tax
|
145
|
|
|
—
|
|
|
145
|
|
|||
Balance at December 31, 2017
|
(10,054
|
)
|
|
(2,442
|
)
|
|
(12,496
|
)
|
|||
Other comprehensive loss net of tax benefit (expense) of ($0) and $ (59), respectively
|
(12,911
|
)
|
|
757
|
|
|
(12,154
|
)
|
|||
Balance at December 31, 2018
|
(22,965
|
)
|
|
(1,685
|
)
|
|
(24,650
|
)
|
|||
Other comprehensive loss net of tax benefit (expense) of ($0) and $95, respectively
|
885
|
|
|
(1,064
|
)
|
|
(179
|
)
|
|||
Balance at December 31, 2019
|
$
|
(22,080
|
)
|
|
$
|
(2,749
|
)
|
|
$
|
(24,829
|
)
|
5.
|
Stock-Based Compensation
|
|
Fiscal Years Ended December 31,
|
||||||||||
(in thousands)
|
2019
|
|
2018
|
|
2017
|
||||||
Stock-based compensation expense recognized in operating expenses
|
$
|
9,480
|
|
|
$
|
10,356
|
|
|
$
|
12,744
|
|
Tax benefit of stock-based compensation expense in provision for income taxes
|
2,330
|
|
|
2,476
|
|
|
4,575
|
|
|||
Stock-based compensation expense, net of tax
|
$
|
7,150
|
|
|
$
|
7,880
|
|
|
$
|
8,169
|
|
Fair value of shares vested
|
$
|
16,760
|
|
|
$
|
15,372
|
|
|
$
|
11,043
|
|
Proceeds to the Company from the exercise of stock options
|
$
|
—
|
|
|
$
|
695
|
|
|
$
|
6,610
|
|
|
Shares
(in thousands) |
|
Weighted-
Average Price |
|
Aggregate
Intrinsic Value * (in thousands) |
|||||
Unvested Restricted Stock Units (RSUs)
|
|
|
||||||||
Outstanding at January 1, 2019
|
604
|
|
|
$
|
41.37
|
|
|
$
|
32,669
|
|
Awarded
|
221
|
|
|
57.73
|
|
|
|
|
||
Vested
|
(275
|
)
|
|
37.71
|
|
|
|
|
||
Forfeited
|
(87
|
)
|
|
57.06
|
|
|
|
|
||
Outstanding at December 31, 2019
|
462
|
|
|
$
|
47.75
|
|
|
$
|
37,065
|
|
Outstanding and expected to vest at December 31, 2019
|
458
|
|
|
$
|
47.69
|
|
|
$
|
36,763
|
|
6.
|
Trade Accounts Receivable, net
|
|
December 31,
|
||||||
(in thousands)
|
2019
|
|
2018
|
||||
Trade accounts receivable
|
$
|
144,729
|
|
|
$
|
149,886
|
|
Allowance for doubtful accounts
|
(1,935
|
)
|
|
(1,364
|
)
|
||
Allowance for sales discounts
|
(3,430
|
)
|
|
(2,470
|
)
|
||
|
$
|
139,364
|
|
|
$
|
146,052
|
|
7.
|
Inventories
|
|
December 31,
|
||||||
(in thousands)
|
2019
|
|
2018
|
||||
Raw materials
|
$
|
95,575
|
|
|
$
|
98,058
|
|
In-process products
|
23,672
|
|
|
24,645
|
|
||
Finished products
|
132,660
|
|
|
153,385
|
|
||
|
$
|
251,907
|
|
|
$
|
276,088
|
|
8.
|
Property, Plant and Equipment, net
|
|
December 31,
|
||||||
(in thousands)
|
2019
|
|
2018
|
||||
Land
|
$
|
28,092
|
|
|
$
|
30,034
|
|
Buildings and site improvements
|
195,210
|
|
|
198,809
|
|
||
Leasehold improvements
|
4,911
|
|
|
4,826
|
|
||
Machinery and equipment
|
351,379
|
|
|
330,076
|
|
||
|
579,592
|
|
|
563,745
|
|
||
Less accumulated depreciation and amortization
|
(346,594
|
)
|
|
(318,388
|
)
|
||
|
232,998
|
|
|
245,357
|
|
||
Capital projects in progress
|
16,014
|
|
|
9,240
|
|
||
|
$
|
249,012
|
|
|
$
|
254,597
|
|
9.
|
Goodwill and Intangible Assets
|
(in thousands)
|
North
America |
|
Europe
|
|
Asia
Pacific |
|
Total
|
||||||||
Balance as of January 1, 2018
|
|
|
|
|
|
|
|
||||||||
Goodwill
|
$
|
106,421
|
|
|
$
|
53,311
|
|
|
$
|
1,489
|
|
|
$
|
161,221
|
|
Accumulated impairment losses
|
(10,666
|
)
|
|
(13,415
|
)
|
|
—
|
|
|
(24,081
|
)
|
||||
|
95,755
|
|
|
39,896
|
|
|
1,489
|
|
|
137,140
|
|
||||
Goodwill acquired
|
913
|
|
|
—
|
|
|
—
|
|
|
913
|
|
||||
Foreign exchange
|
(233
|
)
|
|
(739
|
)
|
|
(145
|
)
|
|
(1,117
|
)
|
||||
Impairment
|
—
|
|
|
(6,686
|
)
|
|
—
|
|
|
(6,686
|
)
|
||||
Balance as of December 31, 2018
|
|
|
|
|
|
|
0
|
|
|||||||
Goodwill
|
107,101
|
|
|
52,573
|
|
|
1,344
|
|
|
161,018
|
|
||||
Accumulated impairment losses
|
(10,666
|
)
|
|
(20,102
|
)
|
|
—
|
|
|
(30,768
|
)
|
||||
|
96,435
|
|
|
32,471
|
|
|
1,344
|
|
|
130,250
|
|
||||
Goodwill acquired
|
—
|
|
|
1,815
|
|
|
—
|
|
|
1,815
|
|
||||
Foreign exchange
|
129
|
|
|
14
|
|
|
(9
|
)
|
|
134
|
|
||||
Reclassifications(1)
|
(320
|
)
|
|
—
|
|
|
—
|
|
|
(320
|
)
|
||||
Balance as of December 31, 2019
|
|
|
|
|
|
|
0
|
|
|||||||
Goodwill
|
106,910
|
|
|
54,402
|
|
|
1,335
|
|
|
162,647
|
|
||||
Accumulated impairment losses
|
(10,666
|
)
|
|
(20,102
|
)
|
|
—
|
|
|
(30,768
|
)
|
||||
|
$
|
96,244
|
|
|
$
|
34,300
|
|
|
$
|
1,335
|
|
|
$
|
131,879
|
|
(in thousands)
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
||||||
Patents
|
|
|
|||||||||
Balance at January 1, 2018
|
$
|
2,350
|
|
|
$
|
(545
|
)
|
|
$
|
1,805
|
|
Amortization
|
—
|
|
|
(107
|
)
|
|
(107
|
)
|
|||
Removal of fully amortized assets
|
(241
|
)
|
|
241
|
|
|
—
|
|
|||
Balance at December 31, 2018
|
2,109
|
|
|
(411
|
)
|
|
1,698
|
|
|||
Purchases of intangible assets
|
2,550
|
|
|
—
|
|
|
2,550
|
|
|||
Amortization
|
—
|
|
|
(150
|
)
|
|
(150
|
)
|
|||
Balance at December 31, 2019
|
$
|
4,659
|
|
|
$
|
(561
|
)
|
|
$
|
4,098
|
|
(in thousands)
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
||||||
Unpatented Technology
|
|
|
|||||||||
Balance at January 1, 2018
|
$
|
21,667
|
|
|
$
|
(10,979
|
)
|
|
$
|
10,688
|
|
Amortization
|
—
|
|
|
(2,557
|
)
|
|
(2,557
|
)
|
|||
Reclassifications (1)
|
277
|
|
|
—
|
|
|
277
|
|
|||
Foreign exchange
|
(90
|
)
|
|
—
|
|
|
(90
|
)
|
|||
Removal of fully amortized assets
|
(1,192
|
)
|
|
1,192
|
|
|
—
|
|
|||
Balance at December 31, 2018
|
20,662
|
|
|
(12,344
|
)
|
|
8,318
|
|
|||
Amortization
|
—
|
|
|
(2,017
|
)
|
|
(2,017
|
)
|
|||
Foreign exchange
|
166
|
|
|
$
|
—
|
|
|
166
|
|
||
Balance at December 31, 2019
|
$
|
21,616
|
|
|
$
|
(14,361
|
)
|
|
$
|
7,255
|
|
(in thousands)
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
||||||
Non-Compete Agreements,
Trademarks and Other
|
|
|
|||||||||
|
|
||||||||||
Balance at January 1, 2018
|
$
|
12,225
|
|
|
(2,817
|
)
|
|
9,408
|
|
||
Assets acquisitions, net of cash acquired
|
879
|
|
|
—
|
|
|
879
|
|
|||
Amortization
|
—
|
|
|
(1,757
|
)
|
|
(1,757
|
)
|
|||
Reclassifications(1)
|
(24
|
)
|
|
—
|
|
|
(24
|
)
|
|||
Removal of fully amortized assets
|
(855
|
)
|
|
855
|
|
|
—
|
|
|||
Balance at December 31, 2018
|
12,225
|
|
|
(3,719
|
)
|
|
8,506
|
|
|||
Purchases of intangible assets
|
2,081
|
|
|
—
|
|
|
2,081
|
|
|||
Assets acquisitions, net of cash acquired
|
6
|
|
|
—
|
|
|
—
|
|
|||
Amortization
|
—
|
|
|
(1,910
|
)
|
|
(1,910
|
)
|
|||
Reclassifications(2)
|
481
|
|
|
—
|
|
|
481
|
|
|||
Foreign exchange
|
10
|
|
|
—
|
|
|
10
|
|
|||
Removal of fully amortized asset
|
(100
|
)
|
|
100
|
|
|
—
|
|
|||
Balance at December 31, 2019
|
$
|
14,703
|
|
|
$
|
(5,529
|
)
|
|
$
|
9,174
|
|
(in thousands)
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
||||||
Customer Relationships
|
|
|
|||||||||
Balance at January 1, 2018
|
$
|
17,678
|
|
|
(10,869
|
)
|
|
6,809
|
|
||
Amortization
|
—
|
|
|
(1,430
|
)
|
|
(1,430
|
)
|
|||
Foreign exchange
|
(115
|
)
|
|
—
|
|
|
(115
|
)
|
|||
Balance at December 31, 2018
|
17,563
|
|
|
(12,299
|
)
|
|
5,264
|
|
|||
Amortization
|
—
|
|
|
(1,433
|
)
|
|
(1,433
|
)
|
|||
Foreign exchange
|
(27
|
)
|
|
—
|
|
|
(27
|
)
|
|||
Balance at December 31, 2019
|
$
|
17,660
|
|
|
$
|
(13,732
|
)
|
|
$
|
3,928
|
|
2020
|
$
|
5,933
|
|
2021
|
5,341
|
|
|
2022
|
3,436
|
|
|
2023
|
2,616
|
|
|
2024
|
1,665
|
|
|
Thereafter
|
5,464
|
|
|
|
$
|
24,455
|
|
|
December 31, 2018
|
||||||||||
|
Gross
Carrying Amount |
|
Accumulated
Amortization |
|
Net
Carrying Amount |
||||||
(in thousands)
|
|
|
|||||||||
Total Intangible Assets
|
|
|
|||||||||
North America
|
$
|
30,825
|
|
|
$
|
(16,002
|
)
|
|
$
|
14,823
|
|
Europe
|
22,353
|
|
|
(12,774
|
)
|
|
9,579
|
|
|||
Total
|
$
|
53,178
|
|
|
$
|
(28,776
|
)
|
|
$
|
24,402
|
|
|
At December 31, 2019
|
||||||||||
|
Gross
Carrying Amount |
|
Accumulated
Amortization |
|
Net
Carrying Amount |
||||||
(in thousands)
|
|
|
|||||||||
Total Intangible Assets
|
|
|
|||||||||
North America
|
$
|
33,756
|
|
|
$
|
(19,173
|
)
|
|
$
|
14,583
|
|
Europe
|
25,500
|
|
|
(15,012
|
)
|
|
10,488
|
|
|||
Total
|
$
|
59,256
|
|
|
$
|
(34,185
|
)
|
|
$
|
25,071
|
|
10.
|
Leases
|
|
Consolidated Balance Sheets Line Item
|
At December 31, 2019
|
||
(in thousands)
|
|
|
||
Operating leases
|
|
|
||
Assets
|
|
|
||
Operating leases
|
Operating lease right-of-use assets
|
$
|
35,436
|
|
Liabilities
|
|
|
||
Operating-current
|
Accrued expenses and other current liabilities
|
$
|
7,392
|
|
Operating-noncurrent
|
Operating lease liabilities
|
27,930
|
|
|
Total operating lease liabilities
|
|
$
|
35,322
|
|
Finance leases
|
|
|
||
Assets
|
|
|
||
Property and equipment, gross
|
Property, plant and equipment, net
|
$
|
3,569
|
|
Accumulated amortization
|
Property, plant and equipment, net
|
(2,739
|
)
|
|
Property and equipment, net
|
Property, plant and equipment, net
|
$
|
830
|
|
Liabilities
|
|
|
||
Other current liabilities
|
Accrued expenses and other current liabilities
|
$
|
1,125
|
|
Other long-term liabilities
|
Deferred income tax and other long-term liabilities
|
386
|
|
|
Total finance lease liabilities
|
|
$
|
1,511
|
|
|
Consolidated Statements of Operations Line Item
|
Twelve Months Ended December 31, 2019
|
||
(in thousands)
|
|
|
||
Operating lease cost
|
General administrative expenses and
cost of sales
|
$
|
9,234
|
|
Finance lease cost:
|
|
|
||
Amortization of right-of-use assets
|
General administrative expenses
|
$
|
872
|
|
Interest on lease liabilities
|
Interest expense, net
|
68
|
|
|
Total finance lease cost
|
|
$
|
940
|
|
|
Twelve Months Ended December 31, 2019
|
||
(in thousands)
|
|
||
Cash paid for amounts included in the measurement of lease liabilities:
|
|
||
Operating cash flows for operating leases
|
$
|
8,988
|
|
Finance cash flows for finance leases
|
1,160
|
|
|
Operating right-of-use assets obtained in exchange for new lease liabilities
|
|
||
Operating leases
|
5,920
|
|
(in thousands)
|
Operating Leases
|
Finance Leases
|
||||
2020
|
$
|
9,425
|
|
$
|
1,160
|
|
2021
|
7,978
|
|
386
|
|
||
2022
|
5,834
|
|
—
|
|
||
2023
|
3,978
|
|
—
|
|
||
2024
|
3,275
|
|
—
|
|
||
Thereafter
|
11,563
|
|
—
|
|
||
Total lease payments
|
42,053
|
|
1,546
|
|
||
Less: Present value discount
|
(6,731
|
)
|
(35
|
)
|
||
Total lease liabilities
|
$
|
35,322
|
|
$
|
1,511
|
|
Weighted-average remaining lease terms (in years):
|
|
|
Operating leases
|
6.54
|
|
Finance leases
|
1.44
|
|
Weighted-average discount rate:
|
|
|
Operating leases
|
5.37
|
%
|
Finance leases
|
3.23
|
%
|
11.
|
Acquisitions and Dispositions
|
12.
|
Accrued Liabilities
|
|
December 31,
|
||||||
(in thousands)
|
2019
|
|
2018
|
||||
Labor related liabilities
|
$
|
41,991
|
|
|
$
|
44,831
|
|
Sales incentives & advertising allowances
|
36,595
|
|
|
36,312
|
|
||
Accrued cash profit sharing and commissions
|
10,210
|
|
|
10,843
|
|
||
Sales tax payable and other
|
10,175
|
|
|
7,405
|
|
||
Dividends payable
|
10,146
|
|
|
10,024
|
|
||
Accrued profit sharing trust contributions
|
$
|
9,047
|
|
|
$
|
7,804
|
|
Operating lease - current portion
|
$
|
7,392
|
|
|
$
|
—
|
|
|
$
|
125,556
|
|
|
$
|
117,219
|
|
13.
|
Debt
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Interest costs incurred
|
$
|
2,172
|
|
|
$
|
1,224
|
|
|
$
|
1,249
|
|
Less: Interest capitalized
|
(144
|
)
|
|
(160
|
)
|
|
(72
|
)
|
|||
Interest expense
|
$
|
2,028
|
|
|
$
|
1,064
|
|
|
$
|
1,177
|
|
14.
|
Commitments and Contingencies
|
15.
|
Income Taxes
|
|
Years Ended December 31,
|
||||||||||
(in thousands)
|
2019
|
|
2018
|
|
2017
|
||||||
Domestic
|
$
|
163,257
|
|
|
$
|
169,109
|
|
|
$
|
132,105
|
|
Foreign
|
15,100
|
|
|
3,019
|
|
|
12,313
|
|
|||
|
$
|
178,357
|
|
|
$
|
172,128
|
|
|
$
|
144,418
|
|
|
Years Ended December 31,
|
|||||||
(in thousands)
|
2019
|
|
2018
|
|
2017
|
|||
Federal tax rate
|
21.0
|
%
|
|
21.0
|
%
|
|
35.0
|
%
|
State taxes, net of federal benefit
|
3.6
|
%
|
|
4.5
|
%
|
|
3.2
|
%
|
Tax benefit of domestic manufacturing deduction
|
—
|
%
|
|
—
|
%
|
|
(2.0
|
)%
|
Mandatory deemed repatriation of foreign earnings
|
—
|
%
|
|
—
|
%
|
|
2.7
|
%
|
Change in U.S. tax rate applied to deferred taxes
|
—
|
%
|
|
—
|
%
|
|
(1.9
|
)%
|
Change in valuation allowance
|
(0.1
|
)%
|
|
1.3
|
%
|
|
1.3
|
%
|
True-up of prior year tax returns to tax provision
|
(0.3
|
)%
|
|
(1.2
|
)%
|
|
(0.5
|
)%
|
Difference between United States statutory and foreign local tax rates
|
0.8
|
%
|
|
0.5
|
%
|
|
(0.8
|
)%
|
Change in uncertain tax position
|
0.1
|
%
|
|
(0.1
|
)%
|
|
—
|
%
|
Other
|
(0.2
|
)%
|
|
0.4
|
%
|
|
(1.1
|
)%
|
Effective income tax rate
|
24.9
|
%
|
|
26.4
|
%
|
|
35.9
|
%
|
|
|||||||
|
December 31,
|
||||||
(in thousands)
|
2019
|
|
2018
|
||||
Deferred asset taxes
|
|
|
|
|
|
||
State tax
|
$
|
721
|
|
|
$
|
919
|
|
Workers’ compensation
|
828
|
|
|
785
|
|
||
Health claims
|
775
|
|
|
445
|
|
||
Vacation liability
|
341
|
|
|
370
|
|
||
Allowance for doubtful accounts
|
324
|
|
|
171
|
|
||
Inventories
|
4,275
|
|
|
5,659
|
|
||
Sales incentive and advertising allowances
|
1,150
|
|
|
799
|
|
||
Lease obligations
|
8,812
|
|
|
—
|
|
||
Stock-based compensation
|
2,695
|
|
|
3,074
|
|
||
Unrealized foreign exchange gain or loss
|
327
|
|
|
440
|
|
||
Foreign tax credit carryforwards
|
4,945
|
|
|
5,043
|
|
||
Uncertain tax positions’ unrecognized tax benefits
|
68
|
|
|
39
|
|
||
Foreign tax loss carry forward
|
7,763
|
|
|
8,091
|
|
||
Other
|
1,026
|
|
|
1,813
|
|
||
|
$
|
34,050
|
|
|
$
|
27,648
|
|
Less valuation allowances
|
(11,617
|
)
|
|
(13,254
|
)
|
||
Total deferred asset taxes
|
$
|
22,433
|
|
|
$
|
14,394
|
|
|
|
|
|
||||
Deferred tax liabilities
|
|
|
|
|
|
||
Depreciation
|
$
|
(10,416
|
)
|
|
$
|
(9,189
|
)
|
Goodwill and other intangibles amortization
|
(13,737
|
)
|
|
(13,027
|
)
|
||
Tax effect on cumulative translation adjustment
|
(523
|
)
|
|
(497
|
)
|
||
Right of use assets
|
(8,764
|
)
|
|
—
|
|
||
Total deferred tax liabilities
|
(33,440
|
)
|
|
(22,713
|
)
|
||
|
|
|
|
||||
Total Deferred tax asset/(liability)
|
$
|
(11,007
|
)
|
|
$
|
(8,319
|
)
|
Reconciliation of Unrecognized Tax Benefits
|
2019
|
|
2018
|
|
2017
|
||||||
Balance at January 1
|
$
|
1,757
|
|
|
$
|
1,895
|
|
|
$
|
1,119
|
|
Additions based on tax positions related to prior years
|
8
|
|
|
—
|
|
|
660
|
|
|||
Reductions based on tax positions related to prior years
|
(30
|
)
|
|
(171
|
)
|
|
(1
|
)
|
|||
Additions for tax positions of the current year
|
167
|
|
|
100
|
|
|
319
|
|
|||
Lapse of statute of limitations
|
(196
|
)
|
|
(67
|
)
|
|
(202
|
)
|
|||
Balance at December 31
|
$
|
1,706
|
|
|
$
|
1,757
|
|
|
$
|
1,895
|
|
16.
|
Retirement Plans
|
17.
|
Related Party Transactions
|
18.
|
Segment Information
|
(in thousands)
|
North
America |
|
Europe
|
|
Asia/
Pacific |
|
Administrative
& All Other |
|
Total
|
||||||||||
2019
|
|
|
|
|
|||||||||||||||
Net sales
|
$
|
972,849
|
|
|
$
|
155,144
|
|
|
$
|
8,546
|
|
|
$
|
—
|
|
|
$
|
1,136,539
|
|
Sales to other segments *
|
1,977
|
|
|
2,068
|
|
|
26,764
|
|
|
—
|
|
|
30,809
|
|
|||||
Income from operations
|
176,329
|
|
|
6,817
|
|
|
(731
|
)
|
|
(1,161
|
)
|
|
181,254
|
|
|||||
Depreciation and amortization
|
30,652
|
|
|
5,457
|
|
|
1,698
|
|
|
595
|
|
|
38,402
|
|
|||||
Significant non-cash charges
|
5,273
|
|
|
1,141
|
|
|
211
|
|
|
4,157
|
|
|
10,782
|
|
|||||
Provision for income taxes
|
40,452
|
|
|
1,934
|
|
|
577
|
|
|
1,412
|
|
|
44,375
|
|
|||||
Capital expenditures, including purchases of
intangible assets, and business acquisitions, net of
cash acquired
|
31,695
|
|
|
8,245
|
|
|
236
|
|
|
—
|
|
|
40,176
|
|
|||||
Total assets
|
1,269,545
|
|
|
169,785
|
|
|
30,055
|
|
|
(374,019
|
)
|
|
1,095,366
|
|
(in thousands)
|
North
America
|
|
Europe
|
|
Asia/
Pacific
|
|
Administrative
& All Other
|
|
Total
|
||||||||||
2018
|
|
|
|
|
|||||||||||||||
Net sales
|
$
|
910,587
|
|
|
$
|
159,027
|
|
|
$
|
9,195
|
|
|
$
|
—
|
|
|
$
|
1,078,809
|
|
Sales to other segments *
|
2,279
|
|
|
1,773
|
|
|
28,292
|
|
|
—
|
|
|
32,344
|
|
|||||
Income (loss) from operations
|
168,139
|
|
|
(2,656
|
)
|
|
(2,029
|
)
|
|
9,171
|
|
|
172,625
|
|
|||||
Depreciation and amortization
|
30,505
|
|
|
6,297
|
|
|
1,794
|
|
|
797
|
|
|
39,393
|
|
|||||
Impairment of goodwill
|
—
|
|
|
6,686
|
|
|
—
|
|
|
—
|
|
|
6,686
|
|
|||||
Significant non-cash charges
|
6,340
|
|
|
1,169
|
|
|
48
|
|
|
3,619
|
|
|
11,176
|
|
|||||
Provision for income taxes
|
39,638
|
|
|
2,947
|
|
|
113
|
|
|
2,797
|
|
|
45,495
|
|
|||||
Capital expenditures and business acquisitions, net of
cash acquired |
27,059
|
|
|
2,556
|
|
|
1,702
|
|
|
—
|
|
|
31,317
|
|
|||||
Total assets
|
1,119,012
|
|
|
157,437
|
|
|
25,644
|
|
|
(280,430
|
)
|
|
1,021,663
|
|
(in thousands)
|
North
America
|
|
Europe
|
|
Asia/
Pacific
|
|
Administrative
& All Other
|
|
Total
|
||||||||||
2017
|
|
|
|
|
|||||||||||||||
Net sales
|
$
|
803,697
|
|
|
$
|
165,155
|
|
|
$
|
8,173
|
|
|
$
|
—
|
|
|
$
|
977,025
|
|
Sales to other segments *
|
3,237
|
|
|
959
|
|
|
20,715
|
|
|
—
|
|
|
24,911
|
|
|||||
Income (loss) from operations
|
132,995
|
|
|
2,723
|
|
|
1,296
|
|
|
1,259
|
|
|
138,273
|
|
|||||
Depreciation and amortization
|
25,745
|
|
|
5,832
|
|
|
1,246
|
|
|
901
|
|
|
33,724
|
|
|||||
Gain on bargain purchase of a business
|
—
|
|
|
6,336
|
|
|
—
|
|
|
—
|
|
|
6,686
|
|
|||||
Significant non-cash charges
|
9,861
|
|
|
1,509
|
|
|
65
|
|
|
2,473
|
|
|
13,908
|
|
|||||
Provision for (benefit from) income taxes
|
47,434
|
|
|
2,124
|
|
|
419
|
|
|
1,824
|
|
|
51,801
|
|
|||||
Capital expenditures and business acquisitions, net of
cash acquired |
70,040
|
|
|
11,411
|
|
|
4,511
|
|
|
—
|
|
|
85,962
|
|
|||||
Total assets
|
953,033
|
|
|
208,640
|
|
|
26,820
|
|
|
(150,970
|
)
|
|
1,037,523
|
|
|
2019
|
|
2018
|
|
2017
|
||||||||||||||||||
(in thousands)
|
Net
Sales |
|
Long-Lived
Assets |
|
Net
Sales |
|
Long-Lived
Assets |
|
Net
Sales |
|
Long-Lived
Assets |
||||||||||||
United States
|
$
|
921,703
|
|
|
$
|
210,349
|
|
|
$
|
860,482
|
|
|
$
|
210,063
|
|
|
$
|
758,181
|
|
|
$
|
223,184
|
|
Canada
|
47,948
|
|
|
1,181
|
|
|
46,874
|
|
|
4,257
|
|
|
43,176
|
|
|
4,650
|
|
||||||
United Kingdom
|
26,376
|
|
|
1,683
|
|
|
27,194
|
|
|
1,417
|
|
|
23,157
|
|
|
1,459
|
|
||||||
Germany
|
22,357
|
|
|
10,529
|
|
|
22,950
|
|
|
13,221
|
|
|
21,821
|
|
|
14,153
|
|
||||||
France
|
39,969
|
|
|
7,010
|
|
|
40,182
|
|
|
7,891
|
|
|
36,677
|
|
|
9,152
|
|
||||||
Poland
|
11,826
|
|
|
2,770
|
|
|
10,200
|
|
|
2,794
|
|
|
20,409
|
|
|
2,471
|
|
||||||
Sweden
|
13,792
|
|
|
1,762
|
|
|
15,461
|
|
|
1,154
|
|
|
16,421
|
|
|
1,068
|
|
||||||
Denmark
|
10,761
|
|
|
2,235
|
|
|
11,682
|
|
|
1,454
|
|
|
14,723
|
|
|
1,601
|
|
||||||
Norway
|
11,238
|
|
|
—
|
|
|
12,324
|
|
|
—
|
|
|
12,902
|
|
|
229
|
|
||||||
Switzerland
|
5,600
|
|
|
7,781
|
|
|
6,939
|
|
|
8,067
|
|
|
5,593
|
|
|
8,748
|
|
||||||
Australia
|
4,939
|
|
|
110
|
|
|
6,119
|
|
|
199
|
|
|
5,501
|
|
|
268
|
|
||||||
Belgium
|
5,605
|
|
|
1,913
|
|
|
5,547
|
|
|
1,961
|
|
|
5,050
|
|
|
2,065
|
|
||||||
The Netherlands
|
4,019
|
|
|
93
|
|
|
5,068
|
|
|
81
|
|
|
4,834
|
|
|
110
|
|
||||||
New Zealand
|
3,606
|
|
|
166
|
|
|
3,061
|
|
|
111
|
|
|
2,604
|
|
|
130
|
|
||||||
Chile
|
3,198
|
|
|
28
|
|
|
3,233
|
|
|
41
|
|
|
2,314
|
|
|
61
|
|
||||||
Other countries
|
3,602
|
|
|
10,647
|
|
|
1,493
|
|
|
11,635
|
|
|
3,662
|
|
|
12,710
|
|
||||||
|
$
|
1,136,539
|
|
|
$
|
258,257
|
|
|
$
|
1,078,809
|
|
|
$
|
264,346
|
|
|
$
|
977,025
|
|
|
$
|
282,059
|
|
(in thousands)
|
2019
|
|
2018
|
|
2017
|
||||||
Wood Construction
|
$
|
948,768
|
|
|
$
|
913,202
|
|
|
$
|
833,200
|
|
Concrete Construction
|
187,462
|
|
|
165,317
|
|
|
143,102
|
|
|||
Other
|
309
|
|
|
290
|
|
|
723
|
|
|||
Total
|
$
|
1,136,539
|
|
|
$
|
1,078,809
|
|
|
$
|
977,025
|
|
19.
|
Subsequent Events
|
20.
|
Selected Quarterly Financial Data (Unaudited)
|
|
2019
|
|
2018
|
||||||||||||||||||||||||||||
|
Fourth
Quarter |
|
Third
Quarter |
|
Second
Quarter |
|
First
Quarter |
|
Fourth
Quarter |
|
Third
Quarter |
|
Second
Quarter |
|
First
Quarter |
||||||||||||||||
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Net sales
|
$
|
262,510
|
|
|
$
|
309,932
|
|
|
$
|
304,853
|
|
|
$
|
259,244
|
|
|
$
|
241,845
|
|
|
$
|
284,178
|
|
|
$
|
308,007
|
|
|
$
|
244,780
|
|
Cost of sales
|
152,457
|
|
|
172,288
|
|
|
170,674
|
|
|
148,990
|
|
|
143,641
|
|
|
150,282
|
|
|
167,442
|
|
|
137,157
|
|
||||||||
Gross profit
|
110,053
|
|
|
137,644
|
|
|
134,179
|
|
|
110,254
|
|
|
98,204
|
|
|
133,896
|
|
|
140,565
|
|
|
107,623
|
|
||||||||
Research and development and other engineering
|
11,771
|
|
|
11,972
|
|
|
11,055
|
|
|
12,260
|
|
|
10,216
|
|
|
10,441
|
|
|
11,249
|
|
|
11,150
|
|
||||||||
Selling
|
28,097
|
|
|
27,672
|
|
|
28,687
|
|
|
28,112
|
|
|
26,278
|
|
|
26,879
|
|
|
29,201
|
|
|
27,573
|
|
||||||||
General and administrative
|
39,333
|
|
|
37,047
|
|
|
41,345
|
|
|
39,549
|
|
|
45,004
|
|
|
37,358
|
|
|
38,807
|
|
|
37,399
|
|
||||||||
Total operating expenses
|
79,201
|
|
|
76,691
|
|
|
81,087
|
|
|
79,921
|
|
|
81,498
|
|
|
74,678
|
|
|
79,257
|
|
|
76,122
|
|
||||||||
Net gain on disposal of assets
|
(5,759
|
)
|
|
(14
|
)
|
|
(561
|
)
|
|
310
|
|
|
(8,810
|
)
|
|
(460
|
)
|
|
(125
|
)
|
|
(1,184
|
)
|
||||||||
Impairment of goodwill
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,686
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Income from operations
|
36,611
|
|
|
60,967
|
|
|
53,653
|
|
|
30,023
|
|
|
18,830
|
|
|
59,678
|
|
|
61,433
|
|
|
32,685
|
|
||||||||
Interest income (expense), net and other
|
(594
|
)
|
|
(711
|
)
|
|
(260
|
)
|
|
(172
|
)
|
|
(250
|
)
|
|
(88
|
)
|
|
(182
|
)
|
|
(114
|
)
|
||||||||
Foreign exchange gain (loss), net
|
91
|
|
|
(1,067
|
)
|
|
407
|
|
|
(591
|
)
|
|
(530
|
)
|
|
1,244
|
|
|
(689
|
)
|
|
112
|
|
||||||||
Income before income taxes
|
36,108
|
|
|
59,189
|
|
|
53,800
|
|
|
29,260
|
|
|
18,050
|
|
|
60,834
|
|
|
60,562
|
|
|
32,683
|
|
||||||||
Provision for
income taxes
|
8,051
|
|
|
15,503
|
|
|
14,223
|
|
|
6,598
|
|
|
5,293
|
|
|
16,473
|
|
|
16,476
|
|
|
7,253
|
|
||||||||
Net income
|
$
|
28,057
|
|
|
$
|
43,686
|
|
|
$
|
39,577
|
|
|
$
|
22,662
|
|
|
$
|
12,757
|
|
|
$
|
44,361
|
|
|
$
|
44,086
|
|
|
$
|
25,430
|
|
Earnings per share of common stock:
|
|
|
|
|
|
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.63
|
|
|
$
|
0.98
|
|
|
$
|
0.89
|
|
|
$
|
0.50
|
|
|
$
|
0.28
|
|
|
$
|
0.96
|
|
|
$
|
0.95
|
|
|
$
|
0.55
|
|
Diluted
|
0.63
|
|
|
0.97
|
|
|
0.88
|
|
|
0.50
|
|
|
0.28
|
|
|
0.95
|
|
|
0.94
|
|
|
0.54
|
|
||||||||
Cash dividends declared per
share of common stock
|
$
|
0.23
|
|
|
$
|
0.23
|
|
|
$
|
0.23
|
|
|
$
|
0.22
|
|
|
$
|
0.22
|
|
|
$
|
0.22
|
|
|
$
|
0.22
|
|
|
$
|
0.21
|
|
Column A
|
Column B
|
|
Column C
|
|
Column D
|
|
Column E
|
||||||||||||
|
|
|
Additions
|
|
|
|
|
||||||||||||
|
|
|
Charged
|
|
Charged
|
|
|
|
|
||||||||||
|
Balance at
|
|
to Costs
|
|
to Other
|
|
|
|
Balance
|
||||||||||
(in thousands)
|
Beginning
|
|
and
|
|
Accounts —
|
|
|
|
at End
|
||||||||||
Classification
|
of Year
|
|
Expenses
|
|
Write-offs
|
|
Deductions
|
|
of Year
|
||||||||||
Year to date December 31, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Allowance for doubtful accounts
|
$
|
1,364
|
|
|
$
|
977
|
|
|
$
|
406
|
|
|
$
|
—
|
|
|
$
|
1,935
|
|
Allowance for sales discounts
|
3,317
|
|
|
1,431
|
|
|
—
|
|
|
—
|
|
|
4,748
|
|
|||||
Allowance for deferred tax assets
|
13,254
|
|
|
1,423
|
|
|
|
|
|
3,060
|
|
|
11,617
|
|
|||||
Year to date December 31, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Allowance for doubtful accounts
|
996
|
|
|
569
|
|
|
201
|
|
|
—
|
|
|
1,364
|
|
|||||
Allowance for sales discounts
|
2,956
|
|
|
361
|
|
|
—
|
|
|
—
|
|
|
3,317
|
|
|||||
Allowance for deferred tax assets
|
11,114
|
|
|
2,477
|
|
|
—
|
|
|
337
|
|
|
13,254
|
|
|||||
Year to date December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Allowance for doubtful accounts
|
895
|
|
|
66
|
|
|
—
|
|
|
(35
|
)
|
|
996
|
|
|||||
Allowance for sales discounts
|
3,050
|
|
|
(94
|
)
|
|
—
|
|
|
—
|
|
|
2,956
|
|
|||||
Allowance for deferred tax assets
|
6,868
|
|
|
5,765
|
|
|
—
|
|
|
1,519
|
|
|
11,114
|
|
3.2
|
3.3
|
4.1
|
10.1*
|
10.2
|
10.3
|
10.4*
|
10.5*
|
10.6*
|
10.7*
|
Form of Simpson Manufacturing Co., Inc. Director Time Based Restricted Stock Unit Agreement is filed herewith. *Management contract or compensatory plan or arrangement.
|
10.8*
|
10.9*
|
21.
|
23
|
31.1
|
31.2
|
32.
|
101
|
Financial statements from the annual report on Form 10-K of Simpson Manufacturing Co., Inc. for the year ended December 31, 2019, formatted in XBRL, are filed herewith and include: (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations, (iii) the Statement of Comprehensive Income, (iv) the Consolidated Statements of Stockholders’ Equity, (v) the Consolidated Statements of Cash Flows and (vi) the Notes to Consolidated Financial Statements.
|
104
|
Cover Page Interactive Data File (embedded within the Inline XBRL document).
|
Dated:
|
February 25, 2020
|
|
Simpson Manufacturing Co., Inc.
|
|
|
|
(Registrant)
|
|
|
By
|
/s/Brian J. Magstadt
|
|
|
|
Brian J. Magstadt
|
|
|
|
Chief Financial Officer
|
|
|
|
and Duly Authorized Officer
|
|
|
|
of the Registrant
|
|
|
|
(principal accounting and financial officer)
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
Chief Executive Officer:
|
|
|
|
|
|
|
|
|
|
/s/Karen Colonias
|
|
President, Chief Executive
|
|
February 25, 2020
|
(Karen Colonias)
|
|
Officer and Director
|
|
|
|
|
(principal executive officer)
|
|
|
|
|
|
|
|
Chief Financial Officer:
|
|
|
|
|
|
|
|
|
|
/s/Brian J. Magstadt
|
|
Chief Financial Officer and Treasurer
|
|
February 25, 2020
|
(Brian J. Magstadt)
|
|
(principal accounting and financial officer)
|
|
|
|
|
|
|
|
Directors:
|
|
|
|
|
|
|
|
|
|
/s/James S. Andrasick
|
|
Chairman of the Board and Director
|
|
February 25, 2020
|
(James S. Andrasick)
|
|
|
|
|
|
|
|
|
|
/s/Michael A. Bless
|
|
Director
|
|
February 25, 2020
|
(Michael A. Bless)
|
|
|
|
|
|
|
|
|
|
/s/Jennifer A. Chatman
|
|
Director
|
|
February 25, 2020
|
(Jennifer A. Chatman)
|
|
|
|
|
|
|
|
|
|
/s/Gary M. Cusumano
|
|
Director
|
|
February 25, 2020
|
(Gary M. Cusumano)
|
|
|
|
|
|
|
|
|
|
/s/Celeste Volz Ford
|
|
Director
|
|
February 25, 2020
|
(Celeste Volz Ford)
|
|
|
|
|
|
|
|
|
|
/s/Robin G. MacGillivray
|
|
Director
|
|
February 25, 2020
|
(Robin G. MacGillivray)
|
|
|
|
|
|
|
|
|
|
/s/Philip E. Donaldson
|
|
Director
|
|
February 25, 2020
|
(Philip E. Donaldson)
|
|
|
|
|
•
|
prior to the time the stockholder became an interested stockholder, the corporation’s board of directors approved either the applicable business combination or the transaction which resulted in the stockholder becoming an interested stockholder;
|
•
|
upon consummation of the transaction which resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes of determining the voting stock outstanding (but not the voting stock owned by the interested stockholder) shares owned by directors who are also officers of the corporation and shares owned by employee stock plans in which the employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or
|
•
|
at or subsequent to the time that the stockholder became an interested stockholder, the business combination is approved by the corporation’s board of directors and authorized at an annual or special meeting of stockholders by the affirmative vote of at least 66-2/3% of the outstanding voting stock which is not owned by the interested stockholder.
|
•
|
authorize our board of directors, without vote or other action by our stockholders, to cause the issuance of preferred stock in one or more series from time to time and, with respect to each series, to establish the number of shares constituting that series and to fix the rights and other terms of that series, which may include, without limitation, voting rights, dividend rights and preferences, liquidation rights and preferences and rights to convert the preferred stock of such series into other securities or property;
|
•
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provide that, subject to the rights of any series of our preferred stock that may be outstanding, vacancies on our board of directors or newly created directorships resulting from an increase in the number of our directors may be filled only by a majority of directors then in office, even though less than a quorum, or by the sole remaining director;
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•
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provide that the number of directors constituting our board of directors shall be fixed from time to time by resolution adopted by our board of directors;
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•
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require that actions to be taken by our stockholders must be taken at an annual or special meeting of our stockholders and not by written consent;
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•
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establish advance notice procedures and other requirements for stockholders to submit nominations of candidates for election to our board of directors and other proposals to be brought before a stockholders meeting;
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•
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provide that, subject to the rights of any series of preferred stock that may be outstanding and except as may be required by law, special meetings of stockholders may be called only by our board of directors; and
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•
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do not give the holders of our common stock cumulative voting rights with respect to the election of directors, which means that the holders of a majority of our outstanding shares of common stock can elect all directors standing for election by our common stockholders.
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Company:
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Simpson Manufacturing Co., Inc.
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Recipient:
|
The recipient’s name (the “Recipient”) is set forth on the Recipient’s online award acceptance page on Morgan Stanley Smith Barney’s StockPlan Connect website (the “Acceptance Page”) at https://www.stockplanconnect.com, which is incorporated by reference to this Agreement.
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The Number of Shares of Common Stock Subject to RSUs Granted Hereunder
(the “RSU Shares”):
|
The aggregate number of shares of Common Stock as stated on the Acceptance Page.
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The Effective Date of the Award (the “Award Date”):
|
A date in _____ as determined by the Committee in its absolute discretion and as set forth on the Acceptance Page.
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Vesting Schedule
(the “Vesting Schedule”):
|
100% of the RSU Shares will vest on the Award Date.
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|
|
Company:
|
Simpson Manufacturing Co., Inc.
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Recipient:
|
The recipient’s name (the “Recipient”) is set forth on the Recipient’s online award acceptance page on Morgan Stanley Smith Barney’s StockPlan Connect website (the “Acceptance Page”) at https://www.stockplanconnect.com, which is incorporated by reference to this Agreement.
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Target PSU Shares:
|
The aggregate number of shares of Common Stock as stated on the Acceptance Page.
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|
|
The Number of Shares of Common Stock Subject to PSUs Granted Hereunder
(the “PSU Shares”):
|
200% of the Target PSU Shares.
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The Effective Date of the Award (the “Award Date”):
|
A date in ______ as determined by the Committee in its absolute discretion and as set forth on the Acceptance Page.
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Measurement Period
(the “Measurement Period”):
|
A three-year period beginning on _____________, and ending on ________________.
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The Date the PSU Shares Vest
(the “Vesting Date”):
|
A date subsequent to the Measurement Period as determined by the Committee in its absolute discretion and as set forth on the Acceptance Page.
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Vesting Period
(the “Vesting Period”):
|
A period beginning on the Award Date, and ending on the Vesting Date; provided, however, that if the Vesting Date falls on a weekend or federal holiday, such period shall end on the immediately following business day. For example, if the Award Date is determined by the Committee to be March 11, 2020 and the Vesting Date is determined by the Committee to be February 15, 2023, then the PSU Shares, if any (based on the Specific Performance Goals), will vest on February 15, 2023 and the Vesting Period will be from March 11, 2020 to February 15, 2023.
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Specific Performance Goals
(the “Specific Performance Goals”):
|
The Specific Performance Goals are set forth on Exhibit A.
|
Company:
|
Simpson Manufacturing Co., Inc.
|
|
|
Recipient:
|
The recipient’s name (the “Recipient”) is set forth on the Recipient’s online award acceptance page on Morgan Stanley Smith Barney’s StockPlan Connect website (the “Acceptance Page”) at https://www.stockplanconnect.com, which is incorporated by reference to this Agreement.
|
|
|
The Number of Shares of Common Stock Subject to RSUs Granted Hereunder
(the “RSU Shares”):
|
The aggregate number of shares of Common Stock as stated on the Acceptance Page.
|
|
|
The Effective Date of the Award (the “Award Date”):
|
A date in _________ as determined by the Committee in its absolute discretion and as set forth on the Acceptance Page.
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|
|
The Date the RSU Shares Start To Vest
(the “Vesting Start Date”):
|
A date subsequent to the Award Date as determined by the Committee in its absolute discretion and as set forth on the Acceptance Page.
|
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|
Vesting Schedule
(the “Vesting Schedule”):
|
One fifth of the RSU Shares will vest on the first anniversary of the Vesting Start Date and two fifths of the RSU Shares will vest on each of the second and third anniversaries of the Vesting Start Date; provided, however, that if any of such dates falls on a weekend or federal holiday, the applicable portion of the RSU Shares shall vest on the immediately following business day. For example, if the Vesting Start Date is determined by the Committee to be February 15, 2020, then 1/5 of the RSU Shares will vest on February 16, 2021 (because February 15, 2021 is a federal holiday, President’s Day, the immediately following business day is February 16, 2021), 2/5 of the RSU Shares will vest on each of February 15, 2022 and February 15, 2023.
|
|
|
Vesting Period
(the “Vesting Period”):
|
A period beginning on the Vesting Start Date, and ending on the third anniversary of the Vesting Start Date; provided, however, that if such anniversary date falls on a weekend or federal holiday, such period shall end on the immediately following business day. See footnote 1, supra.
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|
|
•
|
the Recipient owns 5% or more of all outstanding Common Stock;
|
•
|
the Recipient owns 1% or more of all outstanding Common Stock and has an annual compensation of more than $150,000; and/or
|
1.
|
Simpson Strong-Tie Company Inc., a California corporation
|
2.
|
Simpson Strong-Tie International, Inc., a California corporation
|
3.
|
Simpson Strong-Tie Canada, Limited, a Canadian corporation
|
4.
|
Simpson Strong-Tie Europe EURL, a French corporation
|
5.
|
Simpson Strong-Tie, S.A.S., a French corporation
|
6.
|
Simpson Strong-Tie Australia, Inc., a California corporation
|
7.
|
Simpson Strong-Tie A/S, a Danish corporation
|
8.
|
Simpson Strong-Tie GmbH, a German corporation
|
9.
|
Simpson Strong-Tie Sp. z.o.o., a Polish corporation
|
10.
|
Simpson France SCI, a French corporation
|
11.
|
Simpson Strong-Tie Australia Pty Limited, an Australian corporation
|
12.
|
Simpson Strong-Tie Asia Limited, a Hong Kong company
|
13.
|
Simpson Strong-Tie Asia Holding Limited, a Hong Kong company
|
14.
|
Simpson Strong-Tie (Zhangjiagang) Co., Ltd., a Chinese company
|
15.
|
Simpson Strong-Tie (New Zealand) Limited, a New Zealand company
|
16.
|
Simpson Strong-Tie Switzerland GmbH, a Switzerland company
|
17.
|
S&P Clever Reinforcement Company AG, a Switzerland company
|
18.
|
S&P Handels GmbH, an Austrian company
|
19.
|
S&P Clever Reinforcement GmbH, a Germany company
|
20.
|
S&P Clever Reinforcement Company Benelux B.V., a Dutch company
|
21.
|
S&P Polska Sp. z.o.o., a Polish corporation
|
22.
|
Clever Reinforcement Iberica - Materiais de Construção, Lda., a Portugal company
|
23.
|
S&P Reinforcement France SAS, a French company
|
24.
|
Simpson Strong-Tie Vietnam Company Limited, a Vietnam company
|
25.
|
Simpson Strong-Tie South Africa (PTY) Ltd, a South Africa company
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26.
|
Simpson Strong-Tie Chile Limitada, a Chile company
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27.
|
S&P Reinforcement Nordic ApS, a Danish company
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28.
|
Simpson Strong-Tie Structural Connectors Ireland Ltd, an Ireland company
|
29.
|
Multi Services Dêcoupe S.A., a Belgium company
|
30.
|
CG Visions, LLC, an Indiana corporation
|
31.
|
Gbo Fastening Systems AB, a Swedish corporation
|
32.
|
Christiania Spigerverk AS, a Norwegian company
|
33.
|
Simpson LotSpec, LLC, a Delware Company
|
34.
|
D.P.P. B.V Limited, a Dutch Company
|
1.
|
I have reviewed this annual report on Form 10-K of Simpson Manufacturing Co., Inc.;
|
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(s) 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(s) 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 control over financial reporting.
|
DATE:
|
February 25, 2020
|
|
|
By /s/Karen Colonias
|
|
|
Karen Colonias
|
||
|
|
Chief Executive Officer
|
1.
|
I have reviewed this annual report on Form 10-K of Simpson Manufacturing Co., Inc.;
|
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(s) 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(s) 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 control over financial reporting.
|
DATE:
|
February 25, 2020
|
|
|
By /s/Brian J. Magstadt
|
|
|
Brian J. Magstadt
|
||
|
|
Chief Financial Officer
|
DATE:
|
February 25, 2020
|
|
|
By /s/Karen Colonias
|
|
|
Karen Colonias
|
||
|
|
Chief Executive Officer
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
By /s/Brian J. Magstadt
|
|
|
|
|
Brian J. Magstadt
|
|
|
|
|
Chief Financial Officer
|
|
|
|
|
|