What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2022-03-04 compared with 2021-09-03 · 53 added, 161 removed, 164 unchanged (57% of the section changed)

Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis should be read in conjunction with the accompanying unaudited condensed consolidated financial statements and related notes as of July 31, 2021, and for the three and nine months ended July 31, 2021 and 2020, included elsewhere herein.

The following discussion and analysis should be read in conjunction with the accompanying unaudited condensed consolidated financial statements and related notes as of January 31, 2022, and for the three months ended January 31, 2022 and 2021, included elsewhere herein.

For additional information pertaining to our business, including risk factors which should be considered before investing in our common stock, refer to our Annual Report on Form 10-K for the fiscal year ended October 31, 2021.

38 unchanged sentences

residential wood cabinet demand.

In August 2021, the NAHB forecasted calendar-year housing starts to be 1.6 million for the 2021, 2022 and 2023 calendar-years.

In August 2021, the Ducker forecast indicated that total window shipments are expected to increase approximately 10.2% for calendar-year 2021 and approximately 3% in 2022 and 2% in 2023.

In January 2022, the NAHB forecasted calendar-year housing starts to be 1.6 million for the 2022 and 2023 calendar-years.

In February 2022, the Ducker forecast indicated that total window shipments are expected to increase approximately 9% for calendar-year 2021 and approximately 6% in 2022 and 2% in 2023.

The estimated increase in window shipments for the year ended December 31, 2022 includes an increase in new construction shipments of approximately 5% and an increase in R&R shipments of approximately 6%.

In August 2021, Catalina Research estimated that residential semi-custom cabinet demand in the U.S.

In February 2022, Catalina Research estimated that residential semi-custom cabinet demand in the U.S.

is estimated to increase 9% in 2021 and 4% in 2022.

28 unchanged sentences

We continue to monitor our exposure to changes in exchange rates.

Results of Operations

Three Months Ended July 31, 2021 Compared to Three Months Ended July 31, 2020

Three Months Ended July 31,

Three Months Ended January 31, 2022 Compared to Three Months Ended January 31, 2021

Three Months Ended January 31,

2022 2021 Change $ % Variance

3 unchanged sentences

Selling, general and administrative 30.8 30.9 (0.1) — %

Restructuring charges — 0.1 (0.1) 100 %

Depreciation and amortization 10.3 11.0 (0.7) 6 %

7 unchanged sentences

NA Fenestration

Three Months Ended July 31,

Three Months Ended January 31,

2022 2021 $ Change % Variance

3 unchanged sentences

Selling, general and administrative 14.4 12.4 2.0 (16)%

Restructuring charges — 0.1 (0.1) 100%

Depreciation and amortization 4.1 5.1 (1.0) 20%

1 unchanged sentence

Operating income margin 8 % 9 %

Net sales increased $25.3 million, or 21%, for the three months ended July 31, 2021 compared to the same period in 2020, which was primarily driven by a $17.6 million increase in volumes, including a recovery from prior year COVID-19 impacts, and an increase in price and raw material surcharges of $7.9 million.

Net sale s increased $18.5 million, or 14%, for the three months ended January 31, 2022 compared to the same period in 2021, which was primarily driven by an increase in price and raw material surcharges of $10.6 million and a $7.9 million increase in volumes.

Cost of Sales.

The cost of sales increased $23.9 million, or 26%, for the three months ended July 31, 2021 compared to the same period in 2020.

The cost of sales increased $16.6 million, or 17%, for the three months ended January 31, 2022 as compared to the same period in 2021.

Cost of sales, including labor, increased primarily due to higher volumes during the period as well as the inflation of raw materials.

Selling, General and Administrative.

S elling, general and administrative expenses increased $1.4 million, or 12%, for the three months ended July 31, 2021 compared to the sam e period in 2020, primarily due to increased general expenses year-over-year.

Restructuring Charges.

Restructuring charges for the three months ended July 31, 2020 relate to facility lease expense for a U.S.

vinyl extrusion plant which was closed in January 2017.

We exited the lease during December 2020.

S elling, general and administrative expenses increased $2.0 million, or 16%, for the three months ended January 31, 2022 as compared to the same period in 2021.

This increase was due primarily to higher professional fees and compensation year-over-year.

Depreciation and Amortization.

Depreciation and amortization expense decreased $1.0 million for the three months ended July 31, 2021 compared to the same period in 2020, reflecti ng the run-off of depreciation expense related to existing assets and disposals during the period.

Depreciation and amortization expense decreased $1.0 million, or 20%, for the three months ended January 31, 2022 as compared to the same period in 2021, reflecting the run-off of depreciation expense related to existing assets and disposals during the period.

EU Fenestration

Three Months Ended July 31,

Three Months Ended January 31,

2022 2021 $ Change Variance %

6 unchanged sentences

Operating income margin 13 % 17 %

Net sales increased $33.0 million, or 86%, for the three months ended July 31, 2021 compared to the same period in 2020, which was primarily driven by a $26.8 million increase in volumes, including a recovery from prior year COVID-19 impacts, $4.1 million of foreign currency rate changes, and $2.2 million of base price increases.

These increases were partially offset by a temporary closure of our manufacturing facility in Germany due to flooding in July 2021.

Net sales increased $9.8 million, o r 20%, comparing the three months ended January 31, 2022 to the same period in 2021, which was primarily driven by a $8.7 million increase in volumes, including a recovery from prior year COVID-19 impacts, and $1.7 million of base price increases partially offset by $0.6 million of foreign currency rate changes.

Cost of Sales.

The cost of sales increased $23.6 million, or 91%, for the three months ended July 31, 2021 compared to the same period in 2020.

Cost of sales increased primarily due to higher volumes during the period.

The cost of sales increased $9.4 million, or 30%, for the three months ended January 31, 2022 compared to the same period in 2021.

Cost of sales increased primarily due to higher volumes during the period as well as the inflation of raw materials.

Selling, General and Administrative.

Selling, general and administrative expense increased $2.8 million, or 58%, for the three months ended July 31, 2021 compared to the same period in 2020.

Selling, general an d administrative expense increased $0.7 million, or 11%, for the three months ended January 31, 2022 compared to the same period in 2021.

The increase is primarily due to higher compensation, general expenses and foreign currency impacts year-over-year.

NA Cabinet Components

Three Months Ended July 31,

Three Months Ended January 31,

2022 2021 $ Change Variance %

6 unchanged sentences

Operating loss margin (2) % — %

N et sales increased $10.0 million, or 19%, for the three months ended July 31, 2021 compared to the same period in 2020, which was driven by an increase in price and raw material indexes of $5.9 million and a $4.1 million increase in volumes.

Net sales increased $8.4 million, or 16%, for the three months ended January 31, 2022 compared to the same period in 2021, which was driven by a $14.3 million increase in price and raw material indexes partially offset by $6.0 million decrease in volumes.

Cost of Sales .

Cost of sales increased $10.2 million, or 23%, for the three months ended July 31, 2021 compared to the same period in 2020.

Cost of sales increased primarily due to rising lumber prices, which are recovered on a lag, and higher volumes during the period.

Cost of sales increased $9.1 million, or 20%, for the three months ended January 31, 2022 compared with the same period in 2021, primarily as a result of higher volumes and lumber price inflation, which are recovered on a lag, partially offset by a decrease in volumes.

Selling, General and Administrative .

Selling, general and administrative expense increased $0.6 million, or 13%, for the three months ended July 31, 2021 compared to the same period in 2020, primari ly due to higher compensation and general expenses year-over-year.

Selling, general and administrative expense increased $0.3 million, or 6%, for the three months ended January 31, 2022 compared to the same period in 2021 due to an increase in general expenses year-over-year.

Unallocated Corporate & Other

Three Months Ended July 31,

2021 2020 $ Change Variance %

(Dollars in millions)

Net sales $ (0.9) $ (0.4) $ (0.5) 125%

Cost of sales (excluding depreciation and amortization) (0.5) (0.2) (0.3) 150%

Selling, general and administrative 1.7 0.7 1.0 143%

Depreciation and amortization 0.1 0.1 — —%

Operating (loss) income $ (2.2) $ (1.0) $ (1.2) 120%

Net sales for Unallocated Corporate & Other represents the elimination of inter-segment sales for the three months ended July 31, 2021 and 2020.

Cost of Sales .

Cost of sales for Unallocated Corporate & Other consists of the elimination of inter-segment sales, profit in inventory, and other costs.

Selling, General and Administrative .

Selling, gen eral and administrative expenses increased $1.0 million, or 143%, for the three months ended July 31, 2021 compared to the same period in 2020.

This increase is attributable to $1.7 million of medical expenses due to a higher claims experience partially offset by $0.4 million of lower compensation expense related to the valuations of our stock based compensation awards and executive bonuses during the three months ended July 31, 2021 as compared to the prior year period.

Changes related to Non-Operating Items:

Interest Expense .

Interest expense decreased $0.6 million for the three months ended July 31, 2021 compared to the same period in 2020 as a re sult of lower interest rates and lower borrowings outstanding during the period.

Income Taxes .

We recorded income tax expense of $7.5 million on pre-tax income of $21.2 million for the three months ended July 31, 2021, an effective rate of 35.3%, and income tax expense of $4.4 million on pre-tax income of $15.2 million for the three months ended July 31, 2020, an effective rate of 28.6% .

The $3.1 million increase in income tax expense year-over-year was primarily driven by the remeasurement of our deferred income tax assets and liabilities related to the increase in the corporate tax rate in the U.K.

from 19% to 25%.

Nine Months Ended July 31, 2021 Compared to Nine Months Ended July 31, 2020

Nine Months Ended July 31,

2021 2020 Change $ % Variance

(Dollars in millions)

Net sales $ 780.4 $ 596.1 $ 184.3 31 %

Cost of sales (excluding depreciation and amortization) 604.7 469.6 135.1 (29) %

Selling, general and administrative 88.3 62.8 25.5 (41) %

Restructuring charges — 0.5 (0.5) 100 %

Depreciation and amortization 32.5 35.8 (3.3) 9 %

Operating income 54.9 27.4 27.5 100 %

Interest expense (2.0) (4.3) 2.3 53 %

Other, net 0.6 0.1 0.5 500 %

Income tax expense (17.4) (6.9) (10.5) (152) %

Net income $ 36.1 $ 16.3 $ 19.8 121 %

Our period-over-period results by reportable segment follow.

Changes Related to Operating Income by Reportable Segment:

NA Fenestration

Nine Months Ended July 31,

2021 2020 $ Change % Variance

(Dollars in millions)

Net sales $ 422.0 $ 341.4 $ 80.6 24%

Cost of sales (excluding depreciation and amortization) 328.3 266.5 61.8 (23)%

Selling, general and administrative 38.9 35.0 3.9 (11)%

Restructuring charges — 0.2 (0.2) 100%

Depreciation and amortization 14.4 18.3 (3.9) 21%

Operating income $ 40.4 $ 21.4 $ 19.0 89%

Operating income margin 10 % 6 %

Net sale s increased $80.6 million, or 24%, for the nine months ended July 31, 2021 compared to the same period in 2020, which was primarily driven by a $66.8 million increase in volumes, including a recovery from prior year COVID-19 impacts, and an increase in price and raw material surcharges of $13.9 million.

Cost of Sales.

The cost of sales increased $61.8 million, or 23%, for the nine months ended July 31, 2021 as compared to the same period in 2020.

Cost of sales, including labor, increased primarily due to higher volumes during the period as well as the inflation of raw materials.

Selling, General and Administrative.

S elling, general and administrative expenses increased $3.9 million, or 11%, for the nine months ended July 31, 2021 as compared to the same period in 2020.

This increase was due primarily to higher compensation year-over-year.

Restructuring Charges.

Restru cturing charges for the nine months ended July 31, 2020 relate to facility lease expense for a U.S.

vinyl extrusion plant which was closed in January 2017.

We exited the lease during December 2020.

Depreciation and Amortization.

Depreciation and amortization expense decreased $3.9 million for the nine months ended July 31, 2021 as compared to the same period in 2020 , reflectin g the run-off of depreciation expense related to existing assets and disposals during the period.

EU Fenestration

Nine Months Ended July 31,

2021 2020 $ Change Variance %

(Dollars in millions)

Net sales $ 181.9 $ 104.2 $ 77.7 75%

Cost of sales (excluding depreciation and amortization) 122.6 72.1 50.5 (70)%

Selling, general and administrative 21.6 16.0 5.6 (35)%

Depreciation and amortization 7.8 7.0 0.8 (11)%

Operating income $ 29.9 $ 9.1 $ 20.8 229%

Operating income margin 16 % 9 %

Net sales increased $77.7 million, or 75%, comparing the nine months ended July 31, 2021 to the same period in 2020, which was primarily driven by a $64.4 million increase in volumes, including a recovery from prior year COVID-19 impacts and the reopening of manufacturing facilities in the U.K.

which were forced to close for several weeks in the second quarter of 2020, $8.6 million of foreign currency rate changes, and $4.6 million of base price increases.

Cost of Sales.

The cos t of sales increased $50.5 million, or 70%, for the nine months ended July 31, 2021 compared to the same period in 2020.

Cost of sales increased primarily due to higher volumes during the period.

Selling, General and Administrative.

Selling, general and administrative expense increased $5.6 million, or 35%, for the nine months ended July 31, 2021 compared to the same period in 2020.

The increase is primarily du e to higher compensation, general expenses and foreign currency impacts year-over-year.

NA Cabinet Components

Nine Months Ended July 31,

Three Months Ended January 31,

2022 2021 $ Change Variance %

3 unchanged sentences

Selling, general and administrative 3.9 7.0 (3.1) (44)%

Restructuring charges — 0.3 (0.3) 100%

Depreciation and amortization 0.1 0.1 — —%

Operating loss $ (4.5) $ (7.5) $ 3.0 40%

Operating loss margin (1) % (2) %

Net sales increased $26.9 million , or 18% , for the nine months ended July 31, 2021 compared to the same period in 2020 , which was driven by a $19.8 million increase in volumes and an increase in price and raw material indexes of $7.1 million.

Cost of Sales .

Cost of sales increased $23.2 million, or 18%, for the nine months ended July 31, 2021 compared with the same period in 2020, primarily as a result of higher volumes and rising lumber prices, which are recovered on a lag.

Selling, General and Administrative .

Selling, general and administrative expense increased $2.0 million, or 15%, for the nine months ended July 31, 2021 compared to the same period in 2020, primarily due to higher compensation and general expenses year-over-year.

Restructuring Charges .

Restructuring charges of $0.3 million in the nine months ended July 31, 2020 related to severance, equipment moving, and other charges incurred for a plant closure.

Unallocated Corporate & Other

Nine Months Ended July 31,

2021 2020 $ Change Variance %

(Dollars in millions)

Net sales $ (3.0) $ (2.1) $ (0.9) (43)%

Cost of sales (excluding depreciation and amortization) (1.6) (1.2) (0.4) (33)%

Selling, general and administrative 12.4 (1.6) 14.0 (875)%

Depreciation and amortization 0.3 0.4 (0.1) 25%

Operating (loss) income $ (14.1) $ 0.3 $ (14.4) (4,800)%

Net sales for Unallocated Corporate & Other represents the elimination of inter-segment sales for the nine months ended July 31, 2021 and 2020.

Net sales for Unallocated Corporate & Other represents the elimination of inter-segment sales for the three months ended January 31, 2022 and 2021.

Cost of Sales .

1 unchanged sentence

Selling, General and Administrative .

Selling, general and administrative expenses increased $14.0 million, or 875%, for the nine months ended July 31, 2021 compared to the same period in 2020.

This increase is attributable to $9.3 million of higher compensation expense related to the valuations of our stock based compensation awards and executive bonuses, $4.8 million of medical expenses due to a higher claims experience during nine months ended July 31, 2021 as compared to the prior year period, and $1.4 million of loss on the sale of a plant.

These increases were partially offset by a reduction in executive severance and legal charges.

Selling, general and administrative expenses decreased $3.1 million, or 44%, for the three months ended January 31, 2022 compared to the same period in 2021.

This decrease is attributable to $2.3 million of decreased compensation expense related to the valuations of our stock based compensation awards during the three months ended January 31, 2022 as compared to the prior year period.

Additionally, we recorded a $1.4 million loss on the sale of a plant during the three months ended January 31, 2021, for which we did not have a comparable expense in the corresponding three months ended January 31, 2022.

These decreases were partially offset by an increase in medical expenses of $0.5 million due to higher claims activity year over year.

Changes related to Non-Operating Items:

Interest Exp ense .

Interest expense decreased $2.3 million for the nine months ended July 31, 2021 compared to the same period in 2020 as a result of lower interest rates and lower borrowings outstanding during the period.

Interest expense decreased $0.2 million for the three months ended January 31, 2022 compared to the same period in 2021 as a result of lower borrowings outstanding during the period and lower interest rates.

Income Taxes .

We recorded income tax expense of $17.4 million on pre-tax income of $53.5 million for the nine months ended July 31, 2021, an effective rate of 32.5%, and income tax expense of $6.9 million on a pre-tax income of $23.2 million for the nine months ended July 31, 2020, an effective rate of 29.7%.

The $10.5 million increase in income tax expense year-over-year was primarily driven by the increase in pre-tax book income as well as the remeasurement of our deferred income tax assets and liabilities related to the increase in the corporate tax rate in the U.K.

from 19% to 25%.

We recorded income tax expense of $2.4 million on pre-tax income of $13.6 million for the three months ended January 31, 2022, an effective rate of 17.7%, and income tax expense of $3.4 million on a pre-tax income of $11.3 million for the three months ended January 31, 2021, an effective rate of 30.4%.

The $1.0 million decrease in income tax expense year-over-year was primarily driven by the benefit from the vesting or exercise of equity-based compensation awards.

Liquidity and Capital Resources

1 unchanged sentence

We maintain a $325.0 million revolving credit facility (the Credit Facility) that matures in 2023 (5-year term) and requires interest payments calculated at a variable market rate depending upon our Consolidated Leverage Ratio.

The applicable rate during the nine months ended July 31, 2021 ranged from LIBOR + 1.50% to LIBOR + 1.25%.

The applicable rate during the three months ended January 31, 2022 was LIBOR + 1.25%.

Our cost of capital could increase depending upon the Consolidated Leverage Ratio at the end of any given quarter.

In addition to the Consolidated Leverage Ratio covenant, we are required to meet a Consolidated Interest Coverage Ratio covenant, and there are limitations on certain transactions including our ability to incur indebtedness, incur liens, dispose of material assets, acquire businesses, make restricted payments and pay dividends (limited to $20.0 million per year).

In addition to the Con solidated Leverage Ratio covenant, we are required to meet a Consolidated Interest Coverage Ratio covenant, and there are limitations on certain transactions including our ability to incur indebtedness, incur liens, dispose of material assets, acquire businesses, make restricted payments and pay dividends (limited to $20.0 million per year).

We are amortizing deferred financing fees of $0.5 million straight-line over the remaining term of the facility.

For further details of the Credit Facility, refer to Note 4, “Debt and Finance Lease Obligations” to the accompanying unaudited condensed consolidated financial statements contained elsewhere herein.

As of July 31, 2021, w e had $43.7 million of cash and equivalents, $58.0 million outstanding under the Credit Facility, $4.5 million of outstanding letters of credit and $16.0 million outstanding under finance leases and other debt.

We had $262.5 million available for use under the Credit Facility at July 31, 2021.

We repatriated $17.7 million and $12.6 million of f oreign cash during the nine months ended July 31, 2021 and 2020, respectively.

As of January 31, 2022, w e had $31.7 million of cash and equivalents, $63.0 million outstanding under the Credit Facility, $4.5 million of outstanding letters of credit and $15.0 million outstanding under finance leases and other debt.

We had $257.5 million available for use under the Credit Facility at January 31, 2022.

In December 2021, our Board of Directors approved a stock repurchase program that authorized the repurchase of up to $75.0 million worth of shares of our common stock.

Repurchases under the new program will be made in open market transactions or privately negotiated transactions, subject to market conditions, applicable legal requirements and other relevant factors.

The program does not have an expiration date or a limit on the number of shares that may be purchased.

We repatriated $1.2 million and $1.0 million of f oreign cash during the three months ended January 31, 2022 and 2021, respectively.

We expect to repatriate excess cash moving forward and use the funds to retire debt or meet current working capital needs.

2 unchanged sentences

Analysis of Cash Flow

The following table summarizes our cash flow results for the nine months ended July 31, 2021 and 2020:

Nine Months Ended

The following table summarizes our cash flow results for the three months ended January 31, 2022 and 2021:

Three Months Ended

(In millions)

Cash provided by operating activities $ 47.4 $ 47.6

Cash used for operating activities $ (21.7) $ (3.4)

Cash used for investing activities $ (7.4) $ (5.2)

Cash used for financing activities $ (43.5) $ (17.4)

Operating Activities .

Cash provided by operating activities for the nine months ended July 31, 2021 decreased $0.2 million compared to the nine months ended July 31, 2020.

The decrease in cash provided by operating activities is primarily due to an increase in working capital partially offset by higher net income year-over-year due to increased demand.

The increase in working capital was largely driven by an inventory build and raw material price inflation.

Cash provided by (used for) financing activities $ 20.9 $ (0.6)

Operating A ctivities .

Cash used for operating activities for the three months ended January 31, 2022 increased $18.3 million compared to the three months ended January 31, 2021.

The increase in cash used for operating activities is primarily due to an increase in working capital partially offset by higher net income year-over-year due to increased demand.

The increase in working capital was largely driven by an inventory build and raw material price inflation and a higher payout of accrued incentives.

Investing Activities.

Cash used f or investing activities decreased $7.6 million for the nine months ended July 31, 2021 compared to the same period in 2020, primarily as a result of lower capital expenditures and an increase in proceeds from disposition of capital assets.

Cash used f or investing activities increased $2.2 million for the three months ended January 31, 2022 compared to the same period in 2021, primarily as a result an increase in capital expenditures.

Financing Activities.

Cash used for financing activities was $43.5 million for the nine months ended July 31, 2021, which included $45.5 million of debt repayments, $8.0 million of dividends paid to our shareholders, and $5.7 million of treasury stock repurchases.

Our use of cash was partially offset by $16.3 million of proceeds from stock option exercises.

Cash provided by financing activities was $20.9 million for the three months ended January 31, 2022, which included $24.8 million of net debt borrowings partially offset by $2.6 million of dividends paid to our shareholders and $1.4 million of payroll tax paid to settle shares forfeited upon vesting of stock.

Liquidity Requirements

1 unchanged sentence

Other uses of cash include paying cash dividends to our shareholders and repurchasing our common stock.

During the nine months ended July 31, 2021 and 2020, we repatriated $17.7 million and $12.6 million, respectively, of foreign earnings from our foreign locations.

We maintain cash balances in foreign countries which total $16.8 million as of July 31, 2021.

During the three months ended January 31, 2022 and 2021, we repatriated $1.2 million and $1.0 million, respectively, of foreign earnings from our foreign locations.

We maintain cash balances in foreign countries which total $9.0 million as of January 31, 2022.

Critical Accounting Policies and Estimates

7 unchanged sentences

For a description of our critical accounting policies and estimates, see our Annual Report on Form 10-K for the fiscal year ended October 31, 2021.

Our critical accounting policies and estimates have not changed materially during the nine months ended July 31, 2021.

Our critical accounting policies and estimates have not changed materially during the three months ended January 31, 2022.

While there have been no changes in the application of principles, methods, and assumptions used to determine our significant estimates, we may be required to revise certain accounting estimates and judgments related to the economic and business impact of the COVID-19 pandemic, such as, but not limited to, those related to the valuation of goodwill, intangibles, long-lived assets, accounts receivable, and inventory, which could have a material adverse effect on our financial position and results of operations.

1 unchanged sentence

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (FASB) or other standards setting bodies that we adopt as of the specified effective date.

Unless otherwise discussed, we believe the impact of any recently issued standards that are not yet effective are either not applicable to us at this time or will not have a material impact on our condensed consolidated financial statements upon adoption.

In June 2016, the FASB issued Accounting Standards Update No.

2016-13, Financial Instruments - Credit Losses (Topic 326) .

This ASU sets forth a “current expected credit loss” model, which requires the measurement of all expected credit losses for financial instruments or other assets (e.g., trade receivables), held at the reporting date based on historical experience, current conditions, and reasonable supportable forecasts.

We adopted this amendment on November 1, 2020, with no material impact on our condensed consolidated financial statements.

Refer to our Annual Report on Form 10-K for the fiscal year ended October 31, 2020 for additional standards we are currently evaluating.

We did not adopt any new accounting pronouncements during the three months ended January 31, 2022.

As of January 31, 2022, we believe the impact of any recently issued standards that are not yet effective are either not applicable to us at this time or will not have a material impact on our condensed consolidated financial statements upon adoption.

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 2. Management’s Discussion and Analysis