What changed in this filing

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Item 1. Financial Statements

2022-05-05 compared with 2021-11-01 · 64 added, 143 removed, 485 unchanged (30% of the section changed)

3 unchanged sentences

Three Months Ended

September 30 Nine Months Ended

2021 2020 2021 2020

(thousands, except per-share data)

5 unchanged sentences

General and administrative expenses 26,052 25,262

Loss on curtailment of facility — — — 1,707

Other (income) expense, net ( 2,488 ) ( 97 )

1 unchanged sentence

Income from operations 405,628 205,261

Foreign currency exchange gain (loss) ( 353 ) 265 ( 52 ) ( 199 )

Foreign currency exchange gain 132 154

Pension expense (excluding service costs) ( 171 ) ( 19 )

2 unchanged sentences

Change in fair value of interest rate swaps 2,066 1,024

Loss on extinguishment of debt — ( 13,968 ) — ( 13,968 )

( 4,162 ) ( 4,657 )

13 unchanged sentences

Three Months Ended

September 30 Nine Months Ended

2021 2020 2021 2020

Net income $ 302,600 $ 149,156

2 unchanged sentences

Amortization of actuarial (gain) loss, net of tax of $ 5 and $( 1 ), respectively

( 3 ) 151 ( 10 ) 452

Effect of settlements, net of tax of $ 32 and $ — , respectively

4 unchanged sentences

Consolidated Balance Sheets

September 30,

2022 December 31,

19 unchanged sentences

Consolidated Balance Sheets (continued)

September 30,

2022 December 31,

33 unchanged sentences

Consolidated Statements of Cash Flows

Nine Months Ended

Three Months Ended

Cash provided by (used for) operations

6 unchanged sentences

Change in fair value of interest rate swaps ( 2,066 ) ( 1,024 )

Loss on curtailment of facility (excluding severance) — 1,476

Other ( 2,412 ) 4

Loss on extinguishment of debt — 13,968

Decrease (increase) in working capital

12 unchanged sentences

Cash provided by (used for) financing

Borrowings of long-term debt, including revolving credit facility 28,000 400,000

Payments of long-term debt, including revolving credit facility ( 28,000 ) ( 405,774 )

Payments of deferred financing costs — ( 6,222 )

Dividends paid on common stock ( 5,939 ) ( 4,440 )

12 unchanged sentences

Net income 302,600 302,600

Other comprehensive loss ( 4 ) ( 4 )

Other comprehensive income 114 114

Common stock issued 117 1 1

6 unchanged sentences

Balance at March 31, 2022 44,815 $ 448 5,367 $ ( 138,909 ) $ 541,737 $ ( 933 ) $ 1,246,346 $ 1,648,689

Net income 302,556 302,556

Other comprehensive loss ( 3 ) ( 3 )

Stock-based compensation 1,411 1,411

Common stock dividends ($ 2.10 per share)

( 83,514 ) ( 83,514 )

Other ( 1 ) ( 1 )

Balance at June 30, 2021 44,698 $ 447 5,367 $ ( 138,909 ) $ 538,841 $ ( 1,085 ) $ 816,416 $ 1,215,710

Net income 91,699 91,699

Other comprehensive loss ( 3 ) ( 3 )

Stock-based compensation 2,181 2,181

Common stock dividends ($ 0.10 per share)

( 3,982 ) ( 3,982 )

Balance at September 30, 2021 44,698 $ 447 5,367 $ ( 138,909 ) $ 541,022 $ ( 1,088 ) $ 904,133 $ 1,305,605

See accompanying condensed notes to unaudited quarterly consolidated financial statements.

5 unchanged sentences

Net income 149,156 149,156

Other comprehensive income 215 215

Other comprehensive loss ( 4 ) ( 4 )

Common stock issued 130 1 1

6 unchanged sentences

Balance at March 31, 2021 44,698 $ 447 5,367 $ ( 138,909 ) $ 537,431 $ ( 1,082 ) $ 597,374 $ 995,261

Net income 33,586 33,586

Other comprehensive income 150 150

Stock-based compensation 1,671 1,671

Common stock dividends ($ 0.10 per share)

( 3,970 ) ( 3,970 )

Balance at June 30, 2020 44,564 $ 446 5,367 $ ( 138,909 ) $ 533,406 $ ( 49,883 ) $ 394,648 $ 739,708

Net income 103,192 103,192

Other comprehensive income 151 151

Common stock issued 4 — —

Stock-based compensation 2,494 2,494

Common stock dividends ($ 1.70 per share)

( 67,534 ) ( 67,534 )

Proceeds from exercise of stock options 125 125

Balance at September 30, 2020 44,568 $ 446 5,367 $ ( 138,909 ) $ 536,025 $ ( 49,732 ) $ 430,306 $ 778,136

See accompanying condensed notes to unaudited quarterly consolidated financial statements.

44 unchanged sentences

In our Wood Products segment, we view our shipping and handling costs as a cost of the manufacturing process and the movement of product to our end customers.

For our BMD segment, costs related to shipping and handling of $ 48.3 million and $ 49.2 million, for the three months ended September 30, 2021 and 2020, respectively, and $ 144.5 million and $ 134.1 million for the nine months ended September 30, 2021 and 2020, respectively, are included in "Selling and distribution expenses" in our Consolidated Statements of Operations.

For our BMD segment, costs related to shipping and handling of $ 56.3 million and $ 46.5 million, for the three months ended March 31, 2022 and 2021, respectively, are included in "Selling and distribution expenses" in our Consolidated Statements of Operations.

In our BMD segment, our activities relate to the purchase and resale of finished product, and excluding shipping and handling costs from “Materials, labor, and other operating expenses (excluding depreciation)” provides us a clearer view of our operating performance and the effectiveness of our sales and purchasing functions.

2 unchanged sentences

We provide the rebates to increase the sell-through of our products.

Rebates are generally estimated based on the expected amount to be paid and recorded as a decrease in "Sales." At September 30, 2021, and December 31, 2020, we had $ 131.5 million and $ 56.3 million, respectively, of rebates payable to our customers recorded in "Accrued liabilities, Other" on our Consolidated Balance Sheets.

Rebates are generally estimated based on the expected amount to be paid and recorded as a decrease in "Sales." At March 31, 2022 and December 31, 2021, we had $ 147.2 million and $ 138.1 million, respectively, of rebates payable to our customers recorded in "Accrued liabilities, Other" on our Consolidated Balance Sheets.

We adjust our estimate of revenue at the earlier of when the probability of rebates paid changes or when the amounts become fixed.

2 unchanged sentences

We receive rebates and allowances from our vendors under a number of different programs, including vendor marketing programs.

At September 30, 2021, and December 31, 2020, we had $ 12.3 million and $ 9.9 million, respectively, of vendor rebates and allowances recorded in "Receivables, Other" on our Consolidated Balance Sheets.

At March 31, 2022 and December 31, 2021, we had $ 10.4 million and $ 13.0 million, respectively, of vendor rebates and allowances recorded in "Receivables, Other" on our Consolidated Balance Sheets.

Rebates and allowances received from our vendors are recognized as a reduction of "Materials, labor, and other operating expenses (excluding depreciation)" when the product is sold, unless the rebates and allowances are linked to a specific incremental cost to sell a vendor's product.

16 unchanged sentences

Variable lease expense generally includes reimbursement of actual costs for common area maintenance, property taxes, and insurance on leased real estate and are recorded as incurred.

Most of our operating lease expense is recorded in "Selling and distribution expenses" in our Consolidated Statements of Operations.

Most of our operating lease expense was recorded in "Selling and distribution expenses" in our Consolidated Statements of Operations.

In addition, we do not separate lease and non-lease components for all of our leases.

3 unchanged sentences

Inventories included the following (work in process is not material):

September 30,

2022 December 31,

5 unchanged sentences

Property and equipment consisted of the following asset classes:

September 30,

2022 December 31,

6 unchanged sentences

1,269,701 1,259,404

Less accumulated depreciation ( 750,499 ) ( 708,184 )

accumulated depreciation ( 778,306 ) ( 764,164 )

$ 491,395 $ 495,240

7 unchanged sentences

Our cash is recorded at cost, which approximates fair value, and our cash equivalents are money market funds.

As of September 30, 2021, and December 31, 2020, we held $ 710.7 million and $ 371.8 million, respectively, in money market funds that are measured at fair value on a recurring basis using Level 1 inputs.

As of March 31, 2022 and December 31, 2021, we held $ 859.1 million and $ 701.6 million, respectively, in money market funds that are measured at fair value on a recurring basis using Level 1 inputs.

The recorded values of accounts receivable and accounts payable approximate fair values based on their short-term nature.

At September 30, 2021, and December 31, 2020, the book value of our fixed-rate debt for each period was $ 400.0 million, and the fair value was estimated to be $ 428.0 million and $ 432.0 million, respectively.

At March 31, 2022 and December 31, 2021, the book value of our fixed-rate debt for each period was $ 400.0 million, and the fair value was estimated to be $ 391.0 million and $ 420.0 million, respectively.

The difference between the book value and the fair value is derived from the difference between the period-end market interest rate and the stated rate of our fixed-rate, long-term debt.

5 unchanged sentences

We are exposed to interest rate risk arising from fluctuations in variable-rate LIBOR on our term loan and when we have loan amounts outstanding on our Revolving Credit Facility.

At September 30, 2021, we had $ 50.0 million of variable-rate debt outstanding based on one-month LIBOR .

At March 31, 2022, we had $ 50.0 million of variable-rate debt outstanding based on one-month LIBOR .

Our objective is to limit the variability of interest payments on our debt.

2 unchanged sentences

We do not speculate using derivative instruments.

At September 30, 2021, we had two interest rate swap agreements.

At December 31, 2021, we had two interest rate swap agreements.

Under the interest rate swaps, we receive one-month LIBOR -based variable interest rate payments and make fixed interest rate payments, thereby fixing the interest rate on $ 50.0 million of variable rate debt exposure.

Payments on one interest rate swap, entered into in 2016, with a notional principal amount of $ 50.0 million are due on a monthly basis at an annual fixed rate of 1.007 %, and this swap expires in February 2022 (Initial Swap).

During second quarter 2020, we entered into another forward interest rate swap agreement which commences on the expiration date of the Initial Swap.

Payments on this interest rate swap with a notional principal amount of $ 50.0 million will be due on a monthly basis at an annual fixed rate of 0.39 %, and this swap expires in June 2025.

Payments on one interest rate swap, entered into in 2016, with a notional principal amount of $ 50.0 million were due on a monthly basis at an annual fixed rate of 1.007 %, and this swap expired in February 2022 (Initial Swap).

During 2020, we entered into another forward interest rate swap agreement which commenced on the expiration date of the Initial Swap.

Payments on this interest rate swap with a notional principal amount of $ 50.0 million are due on a monthly basis at an annual fixed rate of 0.39 %, and this swap expires in June 2025.

The interest rate swap agreements were not designated as cash flow hedges, and as a result, all changes in the fair value are recognized in "Change in fair value of interest rate swaps" in our Consolidated Statements of Operations rather than through other comprehensive income.

At September 30, 2021, we recorded a long-term asset of $ 0.7 million in "Other assets" on our Consolidated Balance Sheets, and we also recorded a long-term liability of $ 0.2 million in "Other long-term liabilities" on our Consolidated Balance Sheets, representing the fair value of the interest rate swap agreements.

At December 31, 2020, we recorded a long-term liability of $ 0.6 million in "Other long-term liabilities" on our Consolidated Balance Sheets, representing the fair value of the interest rate swap agreements.

At March 31, 2022, we recorded a long-term asset of $ 3.3 million in "Other assets" on our Consolidated Balance Sheets, representing the fair value of the interest rate swap agreement.

At December 31, 2021, we recorded a long-term asset of $ 1.2 million in "Other assets" on our Consolidated Balance Sheets, and we also recorded a long-term liability of $ 0.1 million in "Other long-term liabilities" on our Consolidated Balance Sheets, representing the fair value of the interest rate swap agreements.

The swaps were valued based on observable inputs for similar assets and liabilities and other observable inputs for interest rates and yield curves (Level 2 inputs).

2 unchanged sentences

In order to manage credit risk, we consider customer concentrations and current economic trends and monitor the creditworthiness of significant customers based on ongoing credit evaluations.

At September 30, 2021, receivables from two customers accounted for approximately 19 % and 12 % of total receivables.

At March 31, 2022, receivables from two customers accounted for approximately 18 % and 12 % of total receivables.

At December 31, 2021, receivables from these two customers accounted for approximately 20 % and 12 % of total receivables.

1 unchanged sentence

New and Recently Adopted Accounting Standards

In March 2020, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2020-04, Reference Rate Reform (Topic 848):

Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met.

In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848):

Scope, which refines the scope of Topic 848 and clarifies some of its guidance as it related to recent rate reform activities.

Our current contracts that reference LIBOR include certain debt instruments and interest rate swaps.

The amendments are effective for eligible contract modifications subsequent to March 12, 2020, and through December 31, 2022.

The adoption of these standards did not and are not expected to have a material effect on our financial statements, but we will assess any eligible contract modifications in the future.

In October 2021, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2021-08, Business Combinations (Topic 805):

Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, which is intended to improve the accounting for acquired revenue contracts with customers in a business combination by addressing diversity in practice and inconsistency related to recognition of an acquired contract liability and payment terms and their effect on subsequent revenue recognized by the acquirer.

This ASU requires an acquirer to account for revenue contracts in accordance with Topic 606 as if it had originated the contracts.

To achieve this, an acquirer may assess how the acquiree applied Topic 606 to determine what to record for the acquired revenue contracts.

The updated guidance is effective for fiscal years beginning after December 15, 2022, with early adoption permitted.

We are currently evaluating the effects of this ASU on our consolidated financial statements and disclosures.

There were no other accounting standards recently issued that had or are expected to have a material impact on our consolidated financial statements and associated disclosures.

For the three and nine months ended September 30, 2021, we recorded $ 31.2 million and $ 183.6 million, respectively, of income tax expense and had an effective rate of 25.4 % and 25.3 %, respectively.

For the three and nine months ended September 30, 2020, we recorded $ 34.6 million and $ 50.0 million, respectively, of income tax expense and had an effective rate of 25.1 % in both periods.

For all periods, the primary reason for the difference between the federal statutory income tax rate of 21 % and the effective tax rate was the effect of state taxes.

During the nine months ended September 30, 2021 and 2020, cash paid for taxes, net of refunds received, were $ 203.5 million and $ 35.3 million, respectively.

For the three months ended March 31, 2022 and 2021, we recorded $ 98.9 million and $ 51.4 million, respectively, of income tax expense and had an effective rate of 24.6 % and 25.6 %, respectively.

For both periods, the primary reason for the difference between the federal statutory income tax rate of 21 % and the effective tax rate was the effect of state taxes.

During the three months ended March 31, 2022 and 2021, cash paid for taxes, net of refunds received, were $ 4.2 million and $ 1.0 million, respectively.

Net Income Per Common Share

6 unchanged sentences

Three Months Ended

September 30 Nine Months Ended

2021 2020 2021 2020

(thousands, except per-share data)

5 unchanged sentences

Net income per common share - Diluted $ 7.61 $ 3.76

The computation of the dilutive effect of other potential common shares excludes stock awards representing no shares of common stock in both the three months ended September 30, 2021 and 2020, and 0.1 million and 0.2 million shares of common stock, respectively, in the nine months ended September 30, 2021 and 2020.

The computation of the dilutive effect of other potential common shares excludes stock awards representing an insignificant number of shares of common stock in both the three months ended March 31, 2022 and 2021.

Under the treasury stock method, the inclusion of these stock awards would have been antidilutive.

Curtailment of Manufacturing Facility

On February 20, 2020, we decided to permanently curtail I-joist production at our Roxboro, North Carolina facility by March 31, 2020.

As a result of the curtailment, we recorded $ 15.0 million of accelerated depreciation during first quarter 2020 to fully depreciate the curtailed I-joist assets.

In addition, we recorded $ 1.7 million of various closure-related costs in "Loss on curtailment of facility" in our Consolidated Statements of Operations.

Long-term debt consisted of the following:

September 30,

2022 December 31,

13 unchanged sentences

The Amended Agreement also contains a requirement that we meet a 1 :1 fixed-charge coverage ratio (FCCR), applicable only if Availability falls below 10 % of the aggregate revolving lending commitments (or $ 35 million).

Availability exceeded the minimum threshold amounts required for testing of the FCCR at all times since entering into the Amended Agreement, and Availability at September 30, 2021, was $ 345.3 million.

Availability exceeded the minimum threshold amounts required for testing of the FCCR at all times since entering into the Amended Agreement, and Availability at March 31, 2022 was $ 346.0 million.

The Amended Agreement permits us to pay dividends only if at the time of payment (i) no default has occurred or is continuing (or would result from such payment) under the Amended Agreement, and (ii) pro forma Excess Availability (as defined in the Amended Agreement) is equal to or exceeds 25 % of the aggregate Revolver Commitments (as defined in the Amended Agreement) or (iii) (x) pro forma Excess Availability is equal to or exceeds 15 % of the aggregate Revolver Commitment and (y) our fixed-charge coverage ratio is greater than or equal to 1 :1 on a pro forma basis.

4 unchanged sentences

In addition, we are required to pay an unused commitment fee at a rate of 0.25 % per annum of the average unused portion of the lending commitments.

At both September 30, 2021, and December 31, 2020, we had no borrowings outstanding under the Revolving Credit Facility and $ 4.7 million and $ 4.8 million, respectively, of letters of credit outstanding.

At both March 31, 2022 and December 31, 2021, we had no borrowings outstanding under the Revolving Credit Facility and $ 4.0 million of letters of credit outstanding.

These letters of credit and borrowings, if any, reduce availability under the Revolving Credit Facility by an equivalent amount.

During the nine months ended September 30, 2021, the minimum and maximum borrowings under the Revolving Credit Facility were zero and $ 28.0 million, respectively, and the average interest rate on borrowings was approximately 1.37 %.

ABL Term Loan

3 unchanged sentences

Interest rates under the ABL Term Loan are based, at our election, on either LIBOR or a base rate, as defined in the Amended Agreement, plus a spread over the index elected that ranges from 1.75 % to 2.00 % for LIBOR rate loans and from 0.75 % to 1.00 % for base rate loans, both dependent on the amount of Average Excess Availability (as defined in the Amended Agreement).

During the nine months ended September 30, 2021, the average interest rate on the ABL Term Loan was approximately 1.85 %.

During the three months ended March 31, 2022, the average interest rate on the ABL Term Loan was approximately 1.92 %.

We have received and expect to continue receiving patronage credits under the ABL Term Loan.

2 unchanged sentences

Patronage credits are recorded as a reduction to interest expense in the year earned.

After giving effect to expected patronage distributions, the effective average net interest rate on the ABL Term Loan was approximately 0.9 % during the nine months ended September 30, 2021.

After giving effect to expected patronage distributions, the effective average net interest rate on the ABL Term Loan was approximately 0.9 % during the three months ended March 31, 2022.

On July 27, 2020, we issued $ 400 million of 4.875 % senior notes due July 1, 2030 (2030 Notes) through a private placement that was exempt from the registration requirements of the Securities Act.

17 unchanged sentences

Cash Paid for Interest

For the nine months ended September 30, 2021 and 2020, cash payments for interest were $ 20.4 million and $ 21.2 million, respectively.

For the three months ended March 31, 2022 and 2021, cash payments for interest were $ 10.6 million and $ 8.7 million, respectively.

The components of lease expense were as follows:

Three Months Ended

September 30 Nine Months Ended

2021 2020 2021 2020

Operating lease cost $ 3,561 $ 3,363

8 unchanged sentences

Supplemental cash flow information related to leases was as follows:

Nine Months Ended

Three Months Ended

Cash paid for amounts included in the measurement of lease liabilities

6 unchanged sentences

Other information related to leases was as follows:

September 30, 2021 December 31, 2020

March 31, 2022 December 31, 2021

Weighted-average remaining lease term (years)

4 unchanged sentences

Finance leases 7.5 % 7.5 %

As of September 30, 2021, our minimum lease payment requirements for noncancelable operating and finance leases are as follows:

As of March 31, 2022, our minimum lease payment requirements for noncancelable operating and finance leases are as follows:

Operating Leases Finance Leases

10 unchanged sentences

Long-term lease obligations $ 52,449 $ 31,451

Retirement and Benefit Plans

The following table presents the pension benefit costs:

Three Months Ended

September 30 Nine Months Ended

2021 2020 2021 2020

Service cost $ — $ 167 $ — $ 501

Interest cost 24 1,474 71 4,420

Expected return on plan assets — ( 1,374 ) — ( 4,120 )

Amortization of actuarial (gain) loss ( 5 ) 202 ( 14 ) 605

Plan settlement loss — — — 86

Net periodic benefit expense $ 19 $ 469 $ 57 $ 1,492

Service cost is recorded in the same income statement line items as other employee compensation costs arising from services rendered, and the other components of net periodic benefit expense are recorded in "Pension expense (excluding service costs)" in our Consolidated Statements of Operations.

During the nine months ended September 30, 2021, we paid $ 0.2 million in cash to the nonqualified pension plan participants.

For the remainder of 2021, we expect to make approximately $ 0.1 million in cash payments to our nonqualified pension plan participants.

Stock-Based Compensation

2 unchanged sentences

PSU and RSU Awards

During the nine months ended September 30, 2021, we granted 73,265 PSUs to our officers and other employees, subject to performance and service conditions.

During the three months ended March 31, 2022, we granted 66,180 PSUs to our officers and other employees, subject to performance and service conditions.

For the officers, the number of shares actually awarded will range from 0 % and 200 % of the target amount, depending upon Boise Cascade's 2022 return on invested capital (ROIC), as approved by our Compensation Committee in accordance with the related grant agreement.

For the other employees, the number of shares actually awarded will range from 0 % to 200 % of the target amount, depending upon Boise Cascade’s 2021 EBITDA, defined as income before interest (interest expense and interest income), income taxes, and depreciation and amortization, determined in accordance with the related grant agreement.

Because the ROIC and EBITDA components contain a performance condition, we record compensation expense over the requisite service period based on the most probable number of shares expected to vest.

During the nine months ended September 30, 2020, we granted 94,850 PSUs to our officers and other employees, subject to performance and service conditions.

During the 2020 performance period, officers and other employees both earned 200 % of the target based on Boise Cascade’s 2020 ROIC and EBITDA, determined by our Compensation Committee in accordance with the related grant agreement.

We define ROIC as net operating profit after taxes (NOPAT) divided by average invested capital (based on a rolling thirteen-month average).

We define NOPAT as net income plus after-tax financing expense.

Invested capital is defined as total assets plus capitalized lease expense, less current liabilities, excluding short-term debt.

For our other employees, the number of shares actually awarded will range from 0 % to 200 % of the target amount, depending upon Boise Cascade’s 2022 EBITDA, defined as income before interest (interest expense and interest income), income taxes, and depreciation and amortization, as approved by executive management, determined in accordance with the related grant agreement.

Because the PSUs contain a performance condition, we record compensation expense over the requisite service period based on the most probable number of shares expected to vest.

During the three months ended March 31, 2021, we granted 73,265 PSUs to our officers and other employees, subject to performance and service conditions.

During the 2021 performance period, officers and other employees both earned 200 % of the target based on Boise Cascade’s 2021 ROIC and EBITDA, as applicable, determined by our Compensation Committee and executive management in accordance with the related grant agreements.

The PSUs granted to officers generally vest in a single installment three years from the date of grant, while the PSUs granted to other employees vest in three equal tranches each year after the grant date.

During the nine months ended September 30, 2021 and 2020, we granted an aggregate of 101,059 and 125,716 RSUs, respectively, to our officers, other employees, and nonemployee directors with only service conditions.

During the three months ended March 31, 2022 and 2021, we granted an aggregate of 81,523 and 96,622 RSUs, respectively, to our officers, other employees, and nonemployee directors with only service conditions.

The RSUs granted to officers and other employees vest in three equal tranches each year after the grant date.

1 unchanged sentence

We based the fair value of PSU and RSU awards on the closing market price of our common stock on the grant date.

During the nine months ended September 30, 2021 and 2020, the total fair value of PSUs and RSUs vested was $ 9.2 million and $ 11.1 million, respectively.

The following summarizes the activity of our PSUs and RSUs awarded under our incentive plan for the nine months ended September 30, 2021:

During the three months ended March 31, 2022 and 2021, the total fair value of PSUs and RSUs vested was $ 12.0 million and $ 9.2 million, respectively.

The following summarizes the activity of our PSUs and RSUs awarded under our incentive plan for the three months ended March 31, 2022:

Number of shares Weighted Average Grant-Date Fair Value Number of shares Weighted Average Grant-Date Fair Value

4 unchanged sentences

Forfeited — — — —

Outstanding, September 30, 2021 246,210 $ 39.50 161,300 $ 45.08

Outstanding, March 31, 2022 317,854 $ 51.46 151,496 $ 64.74

_______________________________

(a) Represents additional PSUs granted during the nine months ended September 30, 2021, related to the 2020 performance condition adjustment described above.

(a) Represents additional PSUs granted during the three months ended March 31, 2022, related to the 2021 performance condition adjustment described above.

Compensation Expense

1 unchanged sentence

Any shares not vested are forfeited.

We recognize stock awards with only service conditions on a straight-line basis over the requisite service period.

We recognize compensation expense for stock awards with only service conditions on a straight-line basis over the requisite service period.

Most of our share-based compensation expense was recorded in "General and administrative expenses" in our Consolidated Statements of Operations.

1 unchanged sentence

Three Months Ended

September 30 Nine Months Ended

2021 2020 2021 2020

PSUs $ 1,306 $ 1,089

1 unchanged sentence

Total $ 2,392 $ 2,092

The related tax benefit for the nine months ended September 30, 2021 and 2020, was $ 1.4 million and $ 1.5 million respectively.

As of September 30, 2021, total unrecognized compensation expense related to nonvested share-based compensation arrangements was $ 12.7 million.

The related tax benefit for the three months ended March 31, 2022 and 2021, was $ 0.6 million and $ 0.5 million respectively.

As of March 31, 2022, total unrecognized compensation expense related to nonvested share-based compensation arrangements was $ 20.5 million.

This expense is expected to be recognized over a weighted-average period of 2.2 years.

1 unchanged sentence

On November 14, 2017, we announced that our board of directors approved a dividend policy to pay quarterly cash dividends to holders of our common stock.

For more information regarding our dividend declarations and payments made during each of the nine months ended September 30, 2021 and 2020, see "Common stock dividends" on our Consolidated Statements of Stockholders' Equity.

On October 28, 2021 , our board of directors declared a quarterly dividend of $ 0.12 per share on our common stock, as well as a supplemental dividend of $ 3.00 per share on our common stock, both payable on December 15, 2021 , to stockholders of record on December 1, 2021 .

For more information regarding our dividend declarations and payments made during each of the three months ended March 31, 2022 and 2021, see "Common stock dividends" on our Consolidated Statements of Stockholders' Equity.

On May 5, 2022 , our board of directors declared a quarterly dividend of $ 0.12 per share on our common stock, as well as a supplemental dividend of $ 2.50 per share on our common stock, both payable on June 15, 2022 , to stockholders of record on June 1, 2022 .

For a description of the restrictions in our asset-based credit facility and the indenture governing our senior notes on our ability to pay dividends, see Note 5, Debt.

operations and earnings, general financial condition, contractual obligations, restrictions imposed by our asset-based credit facility and the indenture governing our senior notes, applicable laws, and other factors that our board of directors may deem relevant.

Future dividend declarations, including amount per share, record date and payment date, will be made at the discretion of our board of directors and will depend upon, among other things, legal capital requirements and surplus, our future operations and earnings, general financial condition, material cash requirements, restrictions imposed by our asset-based credit facility and the indenture governing our senior notes, applicable laws, and other factors that our board of directors may deem relevant.

Accumulated Other Comprehensive Loss

The following table details the changes in accumulated other comprehensive loss for the three and nine months ended September 30, 2021 and 2020:

The following table details the changes in accumulated other comprehensive loss for the three months ended March 31, 2022 and 2021:

Three Months Ended

September 30 Nine Months Ended

2021 2020 2021 2020

Beginning balance, net of taxes

7 unchanged sentences

These amounts are included in the computation of net periodic pension cost.

For additional information, see Note 8, Retirement and Benefit Plans.

Transactions With Related Party

4 unchanged sentences

Accordingly, we do not consolidate LTP's results in our financial statements.

Related-party sales to LTP from our Wood Products segment in our Consolidated Statements of Operations were $ 3.6 million and $ 2.8 million, respectively, during the three months ended September 30, 2021 and 2020, and $ 10.2 million and $ 9.5 million, respectively, during the nine months ended September 30, 2021 and 2020.

Related-party sales to LTP from our Wood Products segment in our Consolidated Statements of Operations were $ 3.7 million and $ 3.3 million, respectively, during the three months ended March 31, 2022 and 2021.

These sales are recorded in "Sales" in our Consolidated Statements of Operations.

Costs and Expenses

Related-party wood fiber purchases from LTP were $ 22.3 million and $ 15.6 million, respectively, during the three months ended September 30, 2021 and 2020, and $ 63.3 million and $ 52.0 million, respectively, during the nine months ended September 30, 2021 and 2020.

Related-party wood fiber purchases from LTP were $ 20.8 million and $ 20.3 million, respectively, during the three months ended March 31, 2022 and 2021.

These costs are recorded in "Materials, labor, and other operating expenses (excluding depreciation)" in our Consolidated Statements of Operations.

7 unchanged sentences

Three Months Ended

September 30 Nine Months Ended

2021 2020 2021 2020

Wood Products (a)

6 unchanged sentences

Other 5.2 5.8

158.3 151.6 615.3 380.7

Building Materials Distribution

7 unchanged sentences

Sales are calculated after intersegment sales eliminations to our BMD segment.

(b) Sales of EWP to external customers are net of the cost of all EWP rebates and sales allowances provided at various stages of the supply chain (including distributors, retail lumberyards, and professional builders).

For the nine months ended September 30, 2021 and 2020, approximately 78 % and 80 %, respectively, of Wood Products' EWP sales volumes were to our BMD segment.

(b) Sales of EWP to external customers are net of the cost of all EWP rebates and sales allowances provided at various stages of the supply chain (including distributors, dealers, and homebuilders).

For the three months ended March 31, 2022 and 2021, approximately 79 % and 78 %, respectively, of Wood Products' EWP sales volumes were to our BMD segment.

An analysis of our operations by segment is as follows:

Three Months Ended

September 30 Nine Months Ended

2021 2020 2021 2020

Net sales by segment

4 unchanged sentences

Segment operating income

Wood Products (b) $ 122,056 $ 66,035 $ 432,869 $ 86,872

Wood Products $ 190,116 $ 97,052

Building Materials Distribution 225,892 120,219

4 unchanged sentences

(a) Primarily represents intersegment sales from our Wood Products segment to our BMD segment.

(b) Wood Products segment operating income for the nine months ended September 30, 2020, included $ 15.0 million of accelerated depreciation and $ 1.7 million of other closure-related costs due to the permanent curtailment of I-joist production at our Roxboro, North Carolina facility.

For more information, see Note 5, Curtailment of Manufacturing Facility.

Commitments, Legal Proceedings and Contingencies, and Guarantees

2 unchanged sentences

In addition, we have purchase obligations for goods and services, capital expenditures, and raw materials entered into in the normal course of business.

As of September 30, 2021, there have been no material changes to the above commitments disclosed in the 2020 Form 10-K.

As of March 31, 2022, there have been no material changes to the above commitments disclosed in the 2021 Form 10-K.

Legal Proceedings and Contingencies

4 unchanged sentences

Financial Statements and Supplementary Data" in our 2021 Form 10-K describes the nature of our guarantees, including the approximate terms of the guarantees, how the guarantees arose, the events or circumstances that would require us to perform under the guarantees, and the maximum potential undiscounted amounts of future payments we could be required to make.

As of September 30, 2021, there have been no material changes to the guarantees disclosed in the 2020 Form 10-K.

As of March 31, 2022, there have been no material changes to the guarantees disclosed in the 2021 Form 10-K.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements