What changed in this filing

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Item 2. Management’s Discussion and Analysis

2023-06-02 compared with 2023-03-10 · 139 added, 58 removed, 142 unchanged (58% 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 January 31, 2023, and for the three months ended January 31, 2023 and 2022, 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 April 30, 2023, and for the three and six months ended April 30, 2023 and 2022, 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, 2022.

22 unchanged sentences

Under the Purchase Agreement, we acquired substantially all of the operating assets comprising LMI’s polymer mixing and rubber compound production business and also agreed to assume certain liabilities relating to the Acquisition.

As consideration for the Purchased Assets, we agreed to pay LMI $92 million in cash, with $7.1 million of this amount funded into escrow substantially as security for the seller parties’ indemnification obligations.

As consideration for the Purchased Assets, we paid $91.3 million in cash utilizing funds borrowed under our Credit Facility.

In connection with the Acquisition, we amended our existing finance lease with Lauren Real Estate Holding LLC for the purpose of adding an additional lease renewal option and increasing rental space by approximately 60,000 square feet of rental space which was added to the 313,595 square feet of rentable area located in Cambridge, Ohio.

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We continue to monitor these situations and their impact on our business.

On March 11, 2020, the WHO declared the outbreak of COVID-19 to be a global pandemic and recommended containment and mitigation measures.

Many of the limitations and mandates on operations have been lifted, however, the COVID-19 pandemic and its related effects continue to have an adverse effect on many sectors of the economy and we may be further impacted.

The war in Ukraine and the impact of COVID-19 on the global economy including inflation and the price of raw materials, supply chain disruptions, and the volatility in interest rates including home mortgage rates are unpredictable and there may be developments outside our control requiring us to adjust our operating plan.

The war in Ukraine and the impact on the global economy including inflation and the price of raw materials, supply chain disruptions, and the volatility in interest rates including home mortgage rates are unpredictable and there may be developments outside our control requiring us to adjust our operating plan.

Market Overview and Outlook

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residential wood cabinet demand.

In February 2023 , the NAHB forecasted calendar-year housing starts to be 1.1 million in the 2023 calendar-year and 1.3 million in 2024.

In February 2023 , the Ducker forecast indicated that total window shipments are expected to increase 1% for calendar-year 2022 and decrease 5.7% in 2023.

In February 2023 , Catalina Research estimated that residential semi-custom cabinet sales in the U.S.

is estimated to decrease 3.6% in 2023 and increase 1.9% in 2024.

In May 2023 , the NAHB forecasted calendar-year housing starts to be 1.3 million in the 2023 and 2024 calendar-years and 1.5 million in 2025.

In May 2023 , the Ducker forecast indicated that total window shipments are expected to decrease 5.9% in calendar-year 2023 and 2.8% in 2024.

Several commodities in our business are subject to pricing fluctuations, including polyvinyl resin (PVC), titanium dioxide (TiO2), petroleum products, aluminum and wood.

For the majority of our customers and critical suppliers, we have price adjusters in place which effectively share the base pass-through price changes for our primary commodities with our customers commensurate with the market at large.

For the majority of our customers and critical suppliers, we have price adjusters in place which effectively share the impact of pass-through price changes for our primary commodities with our customers commensurate with the market at large.

Our long -term exposure to these price fluctuations is somewhat mitigated due to the contractual component of the adjuster programs.

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Results of Operations

Three Months Ended January 31, 2023 Compared to Three Months Ended January 31, 2022

Three Months Ended July 31,

Three Months Ended April 30, 2023 Compared to Three Months Ended April 30, 2022

Three Months Ended April 30,

2023 2022 Change $ % Variance

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NA Fenestration

Three Months Ended July 31,

Three Months Ended April 30,

2023 2022 $ Change % Variance

6 unchanged sentences

Operating income margin 10 % 12 %

Ne t sales increased $6.3 million, or 4%, for the three months ended January 31, 2023 compared to the same period in 2022, which was primarily driven by a $16.5 million contribution from LMI in 2023 and an increase in price and raw material surcharges of $5.1 million partially offset by a $15.2 million decrease in volumes due to customer destocking, softer market demand driven by weaker consumer confidence and a return to normal seasonality.

Net sales decreased $20.9 million, or 12%, for the three months ended April 30, 2023 compared to the same period in 2022, which was primarily driven by a $33.1 million decrease in volumes mainly due to softer market demand, a return to normal seasonality, customer destocking, and a decrease in price and raw material surcharges of $5.6 million, partially offset by a $17.8 million contribution from the addition of LMI in 2023.

Cost of Sales.

The cost of sales increased $8.8 million, or 8%, for the three months ended January 31, 2023 as compared to the same period in 2022.

Cost of sales, including labor, increased primarily due to LMI’s cost of sales in 2023 and inflation of raw materials partially offset by lower volumes during the period.

The cost of sales decreased $15.1 million, or 11%, for the three months ended April 30, 2023 compared to the same period in 2022.

Cost of sales, including labor, decreased primarily due to lower volumes and deflation of raw materials during the period partially offset by LMI’s cost of sales in 2023.

Selling, General and Administrative.

S elling, general and administrative expenses decreased $1.1 million, or 8%, for the three months ended January 31, 2023 as compared to the same period in 2022.

This decrease was primarily due to a decrease in labor costs and professional fees partially offset by an increase in miscellaneous general expenses year-over-year.

S elling, general and administrative expenses increased $0.1 million, or 1%, for the three months ended April 30, 2023 compared to the sam e period in 2022, which was essentially flat year-over-year.

Depreciation and Amortization.

Depreciation and amortization expense increased $1.1 million, or 27%, for the three months ended January 31, 2023 as compared to the same period in 2022, primarily due to the Acquisition of LMI’s property, plant and equipment and intangible assets.

Depreciation and amortization expense increased $1.0 million, or 25%, for the three months ended April 30, 2023 as compared to the same period in 2022, primarily due to the acquisition of LMI’s property, plant and equipment and intangible assets.

EU Fenestration

Three Months Ended July 31,

Three Months Ended April 30,

2023 2022 $ Change % Variance

6 unchanged sentences

Operating income margin 20 % 17 %

Net sales decreased $4.0 million, or 7%, comparing the three months ended January 31, 2023 to the same period in 2022, which was primarily driven by $6.0 million of foreign currency rate changes and a $4.4 million decrease in volumes due to customer destocking, softer market demand driven by weaker consumer confidence and a return to normal seasonality, partially offset by $6.4 million of base price increases.

Net sales decreased $9.7 million, or 13%, for the three months ended April 30, 2023 compared to the same period in 2022, which was primarily driven by a $7.7 million decrease in volumes largely due to softer market demand, a return to normal seasonality, customer destocking, and $4.8 million of foreign currency rate change, partially offset by $2.8 million of base price increases.

Cost of Sales.

The cost of sales decreased $3.5 million, or 9%, for the three months ended January 31, 2023 compared to the same period in 2022.

The cost of sales decreased $9.3 million, or 19%, for the three months ended April 30, 2023 compared to the same period in 2022.

Cost of sales decreased primarily due to lower volumes and foreign currency rate changes during the period partially offset by inflation of raw materials.

Selling, General and Administrative.

Selling, general and administrative expense decreased $0.1 million, or 2%, for the three months ended April 30, 2023 compared to the same period in 2022.

The decrease is primarily due to a decrease in professional fees, labor costs and foreign currency impacts year-over-year.

NA Cabinet Components

Three Months Ended April 30,

2023 2022 $ Change Variance %

(Dollars in thousands)

Net sales $ 53,518 $ 72,878 $ (19,360) (27)%

Cost of sales (excluding depreciation and amortization) 43,731 63,175 (19,444) 31%

Selling, general and administrative 5,971 5,218 753 (14)%

Depreciation and amortization 2,970 3,917 (947) 24%

Operating income $ 846 $ 568 $ 278 49%

Operating income margin 2 % 1 %

N et sales decreased $19.4 million, or 27%, for the three months ended April 30, 2023 compared to the same period in 2022, which was driven by an $18.1 million decrease in volumes due to softer market demand driven by weaker consumer confidence and a $1.3 million decrease in price and raw material indexes.

Cost of Sales .

Cost of sales decreased $19.4 million, or 31%, for the three months ended April 30, 2023 compared to the same period in 2022.

Cost of sales decreased primarily due to lower volumes during the period and lumber price deflation.

Selling, General and Administrative .

Selling, general and administrative expense increased $0.8 million, or 14%, for the three months ended April 30, 2023 compared to the same period in 2022.

The increase is primarily due to a loss on an asset caused by wind damage to a manufacturing facility and an increase in professional fees partially offset by a decrease in labor costs.

Depreciation and Amortization.

Depreciation and amortization expense decreased $0.9 million , or 24% , for the three months ended April 30, 2023 as compared to the same period in 2022, reflecting the run-off of depreciation expense related to

existing assets.

Unallocated Corporate & Other

Three Months Ended April 30,

2023 2022 $ Change Variance %

(Dollars in thousands)

Net sales $ (721) $ (1,320) $ 599 45%

Cost of sales (excluding depreciation and amortization) (283) (803) 520 (65)%

Selling, general and administrative (1,210) 232 (1,442) 622%

Depreciation and amortization 83 86 (3) 3%

Operating income (loss) $ 689 $ (835) $ 1,524 183%

Net sales for Unallocated Corporate & Other represents the elimination of inter-segment sales for the three months ended April 30, 2023 and 2022.

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, general and administrative expenses decreased $1.4 million, or 622%, for the three months ended April 30, 2023 compared to the same period in 2022.

This decrease is primarily attributable to a decrease in medical expense claims and lower compensation expense including the valuations of our stock-based compensation awards during the three months ended April 30, 2023 as compared to the prior year period.

Changes related to Non-Operating Items:

Interest Exp ense .

Interest expense increased $1.6 million for the three months ended April 30, 2023 compared to the same period in 2022 as a result of higher borrowings outstanding during the period and an increase in interest rates.

Income Taxes .

We recorded inco me tax expense of $5.6 million on pre-tax income of $27.1 million for the three months ended April 30, 2023, an effective rate of 20.5%, and income tax expense of $7.9 million on pre-tax income of $34.4 million for the three months ended April 30, 2022, an effective rate of 22.9%.

The decrease in income tax expense year-over-year was primarily driven by the decrease in pre-tax book income during the three months ended April 30, 2023, relative to the three months ended April 30, 2022.

Six Months Ended April 30, 2023 Compared to Six Months Ended April 30, 2022

Six Months Ended April 30,

2023 2022 Change $ % Variance

(Dollars in thousands)

Net sales $ 535,451 $ 589,933 $ (54,482) (9) %

Cost of sales (excluding depreciation and amortization) 416,521 461,485 (44,964) 10 %

Selling, general and administrative 64,115 58,952 5,163 (9) %

Depreciation and amortization 21,076 20,820 256 (1) %

Operating income 33,739 48,676 (14,937) (31) %

Interest expense (4,503) (1,125) (3,378) (300) %

Other, net 189 507 (318) (63) %

Income tax expense (6,004) (10,297) 4,293 42 %

Net income $ 23,421 $ 37,761 $ (14,340) (38) %

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

Changes Related to Operating Income by Reportable Segment:

NA Fenestration

Six Months Ended April 30,

2023 2022 $ Change % Variance

(Dollars in thousands)

Net sales $ 309,955 $ 324,539 $ (14,584) (4)%

Cost of sales (excluding depreciation and amortization) 247,189 253,535 (6,346) 3%

Selling, general and administrative 27,453 28,455 (1,002) 4%

Depreciation and amortization 10,295 8,177 2,118 (26)%

Operating income $ 25,018 $ 34,372 $ (9,354) (27)%

Operating income margin 8 % 11 %

Ne t sales decreased $14.6 million, or 4%, for the six months ended April 30, 2023 compared to the same period in 2022, which was primarily driven by a $48.3 million decrease in volumes mainly due to softer market demand, a return to normal seasonality, customer destocking, and an decrease in price and raw material surcharges of $0.5 million, partially offset by a $34.2 million contribution from the addition of LMI in 2023.

Cost of Sales.

The cost of sales decreased $6.3 million, or 3%, for the six months ended April 30, 2023 as compared to the same period in 2022.

Cost of sales, including labor, decreased primarily due to lower volumes and deflation of raw materials during the period partially offset by LMI’s cost of sales in 2023.

Selling, General and Administrative.

S elling, general and administrative expenses decreased $1.0 million, or 4%, for the six months ended April 30, 2023 as compared to the same period in 2022.

This decrease was primarily due to a decrease in labor costs year-over-year.

Depreciation and Amortization.

Depreciation and amortization expense increased $2.1 million, or 26%, for the six months ended April 30, 2023 as compared to the same period in 2022, primarily due to the acquisition of LMI’s property, plant and equipment and intangible assets.

EU Fenestration

Six Months Ended April 30,

2023 2022 $ Change Variance %

(Dollars in thousands)

Net sales $ 118,715 $ 132,341 $ (13,626) (10)%

Cost of sales (excluding depreciation and amortization) 78,155 90,935 (12,780) 14%

Selling, general and administrative 15,957 15,904 53 —%

Depreciation and amortization 4,701 5,091 (390) 8%

Operating income $ 19,902 $ 20,411 $ (509) (2)%

Operating income margin 17 % 15 %

Net sales decreased $13.6 million, or 10%, comparing the six months ended April 30, 2023 to the same period in 2022, which was primarily driven by a $12.0 million decrease in volumes largely due to softer market demand, a return to normal seasonality, customer destocking, and $10.8 million of foreign currency rate change, partially offset by $9.2 million of base price increases.

Cost of Sales.

The cost of sales decreased $12.8 million, or 14%, for the six months ended April 30, 2023 compared to the same period in 2022.

Cost of sales decreased primarily due to a decrease in volumes and foreign currency impacts partially offset by inflation of raw materials.

Selling, General and Administrative.

Selling, general and administrative expense increased $0.2 million, or 3%, for the three months ended January 31, 2023 compared to the same period in 2022.

The increase is primarily due to higher compensation and miscellaneous general expenses partially offset by a decrease in professional fees and foreign currency impacts year-over-year.

Selling, general and administrative expense increased $0.1 million, for the six months ended April 30, 2023 compared to the same period in 2022, which was essentially flat year-over-year.

NA Cabinet Components

Three Months Ended July 31,

Six Months Ended April 30,

2023 2022 $ Change Variance %

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Operating loss margin — % (1) %

Net sales decreased $7.7 million, or 12%, for the three months ended January 31, 2023 compared to the same period in 2022, which was driven by an $11.0 million decrease in volumes due to softer market demand driven by weaker consumer confidence and a return to normal seasonality partially offset by a $3.3 million increase in price and raw material indexes.

Net sales decreased $27.0 million, or 20%, for the six months ended April 30, 2023 compared to the same period in 2022, which was driven by a $29.1 million decrease in volumes due to softer market demand driven by weaker consumer confidence partially offset by a $2.1 million increase in price and raw material indexes.

Cost of Sales .

Cost of sales decreased $7.0 million, or 13%, for the three months ended January 31, 2023 compared with the same period in 2022, primarily as a result of lower volumes year-over-year partially offset by lumber price inflation, which is recovered on a lag.

Cost of sales decreased $26.5 million, or 22%, for the six months ended April 30, 2023 compared with the same period in 2022, primarily as a result of lower volumes year-over-year and lumber price deflation.

Selling, General and Administrative .

Selling, general and administrative expense decreased $0.4 million, or 8%, for the three months ended January 31, 2023 compared to the same period in 2022 due to a decrease in labor costs partially offset by an increase in miscellaneous general expenses year-over-year.

Selling, general and administrative expense increased $0.4 million, or 3%, for the six months ended April 30, 2023 compared to the same period in 2022 primarily due to a loss on an asset caused by wind damage to a manufacturing facility and an increase in professional fees partially offset by a decrease in labor costs.

Depreciation and Amortization.

Depreciation and amortization expense decreased $1.5 million , or 20%, for the six months ended April 30, 2023 as compared to the same period in 2022, reflecting the run-off of depreciation expense related to

existing assets.

Unallocated Corporate & Other

Three Months Ended July 31,

Six Months Ended April 30,

2023 2022 $ Change Variance %

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Operating loss $ (10,838) $ (5,222) $ (5,616) (108)%

Net sales for Unallocated Corporate & Other represents the elimination of inter-segment sales for the three months ended January 31, 2023 and 2022.

Net sales for Unallocated Corporate & Other represents the elimination of inter-segment sales for the six months ended April 30, 2023 and 2022.

Cost of Sales .

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Selling, General and Administrative .

Selling, general and administrative expenses increased $7.2 million, or 186%, for the three months ended January 31, 2023 compared to the same period in 2022.

This increase is primarily attributable to $5.4 million of transaction fees and a $2.0 million increase in compensation expense including the valuations of our stock based compensation awards, partially offset by a decrease of $0.6 million related to medical expense claims during the three months ended January 31, 2023 as compared to the prior year period.

Selling, general and administrative expenses increased $5.8 million, or 140%, for the six months ended April 30, 2023 compared to the same period in 2022.

This increase is primarily attributable an increase in transaction fees and compensation expense including the valuations of our stock-based compensation awards, partially offset by a decrease related to medical expense claims during the six months ended April 30, 2023 as compared to the prior year period.

Changes related to Non-Operating Items:

Interest Exp ense .

Interest expense increased $1.7 million for the three months ended January 31, 2023 compared to the same period in 2022 as a result of higher borrowings outstanding during the period and an increase in interest rates.

Interest expense increased $3.4 million for the six months ended April 30, 2023 compared to the same period in 2022 as a result of higher borrowings outstanding during the period and an increase in interest rates.

Income Taxes .

We recorded income tax expense of $0.5 million on pre-tax income of $2.4 million for the three months ended January 31, 2023, an effective rate of 19.2%, and income tax expense of $2.4 million on a pre-tax income of $13.6 million for the three months ended January 31, 2022, an effective rate of 17.7%.

The decrease in income tax expense year-over-year was primarily driven by the decrease in pre-tax book income during the three months ended January 31, 2023, relative to the three months ended January 31, 2022.

We recorded income tax expense of $6.0 million on pre-tax income of $29.4 million for the six months ended April 30, 2023, an effective rate of 20.4%, and income tax expense of $10.3 million on a pre-tax income of $48.1 million for the six months ended April 30, 2022, an effective rate of 21.4%.

The decrease in income tax expense year-over-year was primarily driven by the decrease in pre-tax book income during the six months ended April 30, 2023, relative to the six months ended April 30, 2022.

Liquidity and Capital Resources

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We maintain a $325.0 million revolving credit facility (the Credit Facility) that matures in 2027 (5-year term) and requires interest payments calculated at a variable market rate depending upon our Consolidated Net Leverage Ratio.

The applicable rate during the three months ended January 31, 2023 was RFR Rate + 1.25%.

The applicable rate during the six months ended April 30, 2023 was RFR Rate + 1.25%.

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

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For further details of the Credit Facility, refer to Note 6, “Debt and Finance Lease Obligations” to the accompanying unaudited condensed consolidated financial statements contained elsewhere herein.

As of January 31, 2023, we had $43.1 million of cash and equivalents, $100.0 million outstanding under the Credit Facility, $5.1 million of outstanding letters of credit and $55.1 million outstanding under finance leases and other debt.

As of April 30, 2023, we had $43.5 million of cash and equivalents, $80.0 million outstanding under the Credit Facility, $5.1 million of outstanding letters of credit and $55.6 million outstanding under finance leases and other debt.

Of the $55.6 million outstanding under finance leases and other debt, $53.1 million relates to real estate leases.

We had $219.9 million available for use under the Credit Facility at January 31, 2023.

During December 2021, our Board of Directors appro ved 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.

During the three months ended January 31, 2023, we did not purchase any shares under this program and as of

January 31, 2023 we had a maximum of $68.4 million available to purchase shares under this program.

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

We repatriated $4.3 million and $1.2 million of f oreign cash during the three months ended January 31, 2023 and 2022, respectively.

We had $239.9 million available for use under the Credit Facility at April 30, 2023.

We repatriated $21.2 million and $4.1 million of f oreign cash during the six months ended April 30, 2023 and 2022, respectively.

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

In the U.K., we insure against a portion of our credit losses.

We believe our business model, our current cash reserves and the recent steps we have taken to strengthen our balance sheet leave us well-positioned to manage our business and remain in compliance with our debt covenants.

We believe our business model, our current cash reserves and our strong balance sheet leave us well-positioned to manage our business and remain in compliance with our debt covenants.

Analysis of Cash Flow

The following table summarizes our cash flow results for the three months ended January 31, 2023 and 2022:

Three Months Ended

The following table summarizes our cash flow results for the six months ended April 30, 2023 and 2022:

Six Months Ended

(Dollars in thousands)

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Operating A ctivities .

Cash provided by operating activities increased $24.8 million for the three months ended January 31, 2023 compared to the three months ended January 31, 2022.

Cash provided by operating activities increased $40.3 million for the six months ended April 30, 2023 compared to the six months ended April 30, 2022.

The increase in operating cash flows is primarily due to favorable changes to working capital partially offset by lower net income year-over-year due to a decrease in customer demand.

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Investing Activities.

Cash used f or investing activities increased $92.1 million for the three months ended January 31, 2023 compared to the same period in 2022, primarily as a result of the Acquisition of LMI.

Cash used f or investing activities increased $92.5 million for the six months ended April 30, 2023 compared to the same period in 2022, primarily as a result of the Acquisition of LMI.

Financing Activities.

Cash provided by financing activities was $83.3 million for the three months ended January 31, 2023, which included $86.4 million of net borrowings of long-term debt, $2.7 million of dividends paid to our shareholders, and $0.6 million of payroll tax paid to settle shares forfeited upon vesting of stock.

Cash provided by financing activities was $54.3 million for the six months ended April 30, 2023, which included $65.7 million of net borrowings of long-term debt, $5.6 million related to the purchase of treasury stock $5.3 million of dividends paid to our shareholders, and $0.6 million of payroll tax paid to settle shares forfeited upon vesting of stock.

Liquidity Requirements

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

During the three months ended January 31, 2023 and 2022, we repatriated $4.3 million and $1.2 million, respectively, of foreign earnings from our foreign locations.

We maintain cash balances in foreign countries which total $12.9 million as of January 31, 2023.

During the six months ended April 30, 2023 and 2022, we repatriated $21.2 million and $4.1 million, respectively, of foreign earnings from our foreign locations.

We maintain cash balances in foreign countries which total $13.1 million as of April 30, 2023.

Critical Accounting Policies and Estimates

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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, 2022.

Our critical accounting policies and estimates have not changed materially during the three months ended January 31, 2023.

Our critical accounting policies and estimates have not changed materially during the six months ended April 30, 2023.

New Accounting Pronouncements

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 consolidated financial statements upon adoption.

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.

We did not adopt any new accounting pronouncements during the three months ended January 31, 2023.

As of January 31, 2023, 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.

We did not adopt any new accounting pronouncements during the three and six months ended April 30, 2023.

As of April 30, 2023, 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