What changed in this filing

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Item 7. Management’s Discussion and Analysis

2024-03-27 compared with 2023-03-24 · 118 added, 114 removed, 340 unchanged (41% of the section changed)

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of the following year.

References to “2022” refer to the fiscal year ended January 28, 2023 and references to“2021” refer to the fiscal year ended January 29, 2022.

2022 and 2021 each consisted of 52 weeks.

References to “2023” refer to the 53-week

fiscal year ending February 3, 2024.

Ollie’s is a highly differentiated and fast-growing, extreme value retailer of brand name merchandise at drastically reduced prices.

Known for our assortment of “Good Stuff Cheap®,”

we offer customers a broad selection of brand name products, including housewares, bed and bath, food, floor coverings, health and beauty aids, books and stationery, toys, and electronics.

Our differentiated go-to market strategy is characterized

by a unique, fun and engaging treasure hunt shopping experience, compelling customer value proposition and witty, humorous in-store signage and advertising campaigns.

These attributes have driven our rapid

growth and strong store performance as evidenced by our store base expansion from 303 stores to 468 stores and net sales growth from $1.241 billion to $1.827 billion from 2018 to 2022 and average annual net sales per store of $4.3 million for the

five-year period.

References to “2023” refer to the 53 week fiscal year ended February 3, 2024 and references to “2022” refer to the 52 week fiscal year ended January 28, 2023.

References to “2024” refer to the 52-week fiscal year ending

February 1, 2025.

Ollie’s is America’s largest retailer of closeout merchandise and excess inventory.

Our stores sell name brand household related items that consumers use in their everyday lives at

prices that are typically 20% to 70% below traditional retailers.

Known for our assortment of “Good Stuff Cheap®,” we offer customers a broad selection of brand name products, including housewares, bed and bath, food, floor coverings, health and

beauty aids, books and stationery, toys, and electronics.

Our differentiated go-to market strategy is characterized by a unique, fun, and engaging treasure hunt shopping experience, compelling customer value proposition and witty, humorous in-store signage and advertising campaigns.

These attributes have driven our rapid growth and strong store performance as evidenced by our store base expansion from 345 stores to 512 stores and net sales growth

from $1.408 billion to $2.103 billion from 2019 to 2023 and average annual net sales per store of $4.3 million for the five-year period.

Our Growth Strategy

Since the founding of Ollie’s in 1982, we have grown organically by backfilling existing markets and leveraging our brand awareness, marketing, and infrastructure to expand into new markets in contiguous states.

have expanded to 468 stores located in 29 states as of January 28, 2023.

have expanded to 512 stores located in 30 states as of February 3, 2024.

Our stores are supported by three distribution centers, one each in York, PA, Commerce, GA, and Lancaster, TX.

We are in the process of expanding our York, PA distribution center, which will provide an additional

201,000 square feet of distribution capacity and is expected to be completed in the first half of 2023.

On October 17, 2022, the Company entered into a purchase agreement to acquire a parcel of land in Princeton, IL for the construction of its fourth

distribution center.

The purchase agreement is subject to customary post-execution, pre-closing activities with an anticipated closing date in the first quarter of fiscal 2023.

With the expansion of our York, PA distribution center and the addition

of our fourth distribution center, we believe our distribution capabilities will support over 700 stores.

We completed the expansion of our York, PA distribution center in

fiscal 2023 providing an additional 201,000 square feet of distribution capacity.

In addition, we broke ground on construction of our fourth distribution center in Princeton, IL in April 2023, the distribution center is expected to be operational

in the second half of fiscal 2024.

With the expansion of our York, PA distribution center and the addition of our fourth distribution center, we believe our distribution capabilities will support up to

We have invested in our associates, infrastructure, distribution network, and information systems to allow us to continue to rapidly grow our store footprint, including:

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Our ability to grow and our results of operations may be impacted by additional factors and uncertainties, such as consumer spending habits, which are subject to macroeconomic conditions and changes in discretionary

Our customers’ discretionary income is primarily impacted by gas prices, wages, rising interest rates, and consumer trends and preferences, which fluctuate depending on the environment.

The potential consolidation of our competitors or other

changes in our competitive landscape could also impact our results of operations or our ability to grow, even though we compete with a broad range of retailers.

Our key competitive advantage is our direct buying relationships with many major manufacturers, wholesalers, distributors, brokers, and retailers for our brand name and closeout products and unbranded goods.

Our customers’ discretionary income is primarily impacted by gas prices, wages, rising interest rates, inflation, and consumer trends and preferences, which fluctuate depending on the environment.

The potential consolidation of our

competitors or other changes in our competitive landscape could also impact our results of operations or our ability to grow, even though we compete with a broad range of retailers.

Our key competitive advantage is our direct buying relationships with many major manufacturers, wholesalers, distributors, brokers, and retailers for our brand name closeout products and unbranded goods.

augment our product mix with private label brands.

As we continue to grow, we believe our increased scale will provide us with even greater access to brand name and closeout products as major manufacturers seek a single buyer to acquire an entire

As we continue to grow, we believe our increased scale will provide us with even greater access to brand name closeout products as major manufacturers seek a single buyer to acquire an entire deal.

How We Assess the Performance of Our Business and Key Line Items

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net sales is primarily driven by the expansion of our store base in existing and new markets.

As we continue to grow, we believe we will have greater access to brand name and closeout merchandise and an increased deal selection, resulting in more

As we continue to grow, we believe we will have greater access to brand name closeout merchandise and an increased deal selection, resulting in more

potential offerings for our customers.

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The spending habits of our customers are subject to macroeconomic conditions and changes in discretionary income.

Our customers’ discretionary income is primarily impacted by gas prices, wages and consumer trends and

preferences, which fluctuate depending on the environment.

However, because we offer a broad selection of merchandise at extreme values, we believe we are generally less impacted than other retailers by economic cycles that correspond with declines

in general consumer spending habits.

Our customers’ discretionary income is primarily impacted by gas prices, wages, inflation, and consumer

trends and preferences, which fluctuate depending on the environment.

However, because we offer a broad selection of merchandise at extreme values, we believe we are generally less impacted than other retailers by economic cycles that correspond

with declines in general consumer spending habits.

We believe we also benefit from periods of increased consumer spending.

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Pre-Opening Expenses

Pre-opening expenses consist of expenses of opening new stores and distribution centers, as well as store closing costs.

For opening new stores, pre-opening expenses include grand opening advertising costs, payroll

expenses, travel expenses, employee training costs, rent expenses, and store setup costs.

Pre-opening expenses consist of expenses of opening new stores and distribution centers, as well as store remodel and store closing costs.

For opening new stores, pre-opening expenses include grand opening advertising

costs, payroll expenses, travel expenses, employee training costs, rent expenses, and store setup costs.

Pre-opening expenses for new stores are expensed as they are incurred, which is typically within 30 to 45 days of opening a new store.

For opening distribution

centers, pre-opening expenses primarily include inventory transportation costs, employee travel expenses, and occupancy costs.

opening distribution centers, pre-opening expenses primarily include inventory transportation costs, employee travel expenses, and occupancy costs.

Store remodel costs primarily consist of payroll expenses, travel expenses, and store setup costs

expensed as they are incurred.

Store closing costs primarily consist of insurance deductibles, rent, and store payroll.

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Components may not add to totals due to rounding.

(2) Average net sales per store represents the weighted average of total net weekly sales divided by the number

of stores open at the end of each week for the respective periods presented.

Average net sales per store represents the weighted average of total net weekly sales divided by the number of stores open at the end of each week for the respective periods presented.

The following table provides a reconciliation of our net income to Adjusted EBITDA for the periods presented:

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Net sales increased to $2.103 billion in 2023 from $1.827 billion in 2022, an increase of $275.7 million, or 15.1%.

The increase was the result of a non-comparable store sales increase of $124.1 million, partially

offset by a comparable store sales decrease of $50.1 million.

The increase in non-comparable store sales was driven by sales from new stores that have not been open for a full 15 months during 2022.

Comparable store sales decreased 3.0% in 2022 compared with 11.1% in 2021.

The decrease in comparable store sales consisted of a decrease in the number of transactions partially offset by an increase in average

transaction size.

The increase in net sales was the result of new store unit growth, a comparable store sales increase

of 5.7%, and $34.0 million of sales in the 53rd week.

Excluding the 53rd week, sales increased 13.2% year over year.

Comparable store sales increased 5.7% in 2023 compared with a 3.0% decrease in 2022.

The increase in comparable store sales consisted of an increase in the number of transactions.

Gross Profit and Gross Margin

Gross profit decreased to $656.1 million in 2022 from $681.2 million in 2021, a decrease of $25.1 million, or 3.7%.

Gross margin decreased 300 basis points to 35.9% in 2022 from 38.9% in 2021.

The decrease in gross

margin in fiscal 2022 is due to increased supply chain costs, primarily the result of higher import and trucking costs and, to a lesser extent, higher wage rates in the Company’s distribution centers.

Gross profit increased to $832.4 million in 2023 from $656.1 million in 2022, an increase of $176.3 million, or 26.9%.

Gross margin increased 370 basis points to 39.6% in 2023 from 35.9% in 2022.

The increase in

gross margin in fiscal 2023 is primarily due to favorable supply chain costs.

Selling, General and Administrative Expenses

SG&A increased to $562.7 million in 2023 from $490.6 million in 2022, an increase of $72.1 million, or 14.7%.

The dollar increase in SG&A was primarily driven by higher selling expenses associated with a net

increase of 37 stores, partially offset by tight expense controls throughout the organization.

As a percentage of net sales, SG&A increased 140 basis points to 26.9% in 2022 from 25.5% in 2021.

This increase was primarily driven by higher

selling expenses associated with our new store unit growth, as well as investments in wages and higher utility costs, partially offset by tight expense controls throughout the organization.

Included in SG&A in 2022 and 2021 is $0.9 million and $0.4 million, respectively, of income related to gains from insurance settlements.

Excluding the gains in both years, SG&A increased 130 basis points as a

percentage of net sales in 2022.

The dollar increase in SG&A was primarily driven by higher selling expenses associated with our new

store unit growth, as well as higher incentive compensation.

As a percentage of net sales, SG&A decreased 10 basis points to 26.8% in 2023 from 26.9% in 2022.

This decrease is primarily the result of leverage of fixed expenses, partially offset

by higher incentive compensation expense.

Included in SG&A in 2022 is $0.9 million, respectively, of income related to gains from insurance settlements.

Excluding the gains in both years, SG&A decreased 10 basis points as a percentage of net sales in

Depreciation and Amortization Expenses

Depreciation and amortization expenses increased to $27.8 million in 2023 from $22.9 million in 2022, an increase of $4.9 million, or 21.4%, the result of the i ncreased asset base

due to new store growth .

due to new store growth and investments in existing stores .

Pre-Opening Expenses

Pre-opening expenses increased to $14.1 million in 2023 from $11.7 million in 2022, an increase of $2.4 million, or 20.3%.

The increase is primarily due to higher costs and the timing of store openings.

new stores and closed three stores in 2022 compared with having opened 46 new stores and closed three stores in 2021.

As a percentage of net sales, pre-opening expenses were 0.6% in both 2022 and 2021.

The increase is primarily due to additional store openings and remodels.

We opened 45 new

stores and closed one store in 2023 compared with having opened 40 new stores and closed three stores in 2022.

As a percentage of net sales, pre-opening expenses was 0.7% in 2023 from 0.6% in 2022.

Interest (Income) Expense, Net

Net interest income was $3.0 million in 2022 compared with net interest expense of $0.2 million in 2021.

Due to favorable interest rates and higher average cash balance in 2022.

Interest income, net was $14.7 million in 2023 compared with $3.0 million in 2022.

The increase in interest income, net in 2023 is primarily due to favorable interest rates and higher average cash and cash equivalent

and short-term investments balances compared to 2022.

Income Tax Expense

Income tax expense decreased to $31.1 million in 2022 from $46.9 million in 2021, a decrease of $15.8 million, or 33.7%.

Income tax expense increased to $61.0 million in 2023 from $31.1 million in 2022, an increase of $29.9 million, or 96.3%.

The effective tax rates for 2023 and 2022 were 25.2% and 23.2%, respectively.

The variance in

the effective tax rates between the periods was primarily due to a decrease in the overall state tax rate, offset by a decrease in excess tax benefits related to stock-based compensation.

Discrete tax benefits totaled $0.3 million and $4.2 million

in 2022 and 2021, respectively.

the effective tax rates between the periods was primarily due to state tax rate changes, offset by an increase in discrete tax benefits related to stock-based compensation.

Discrete tax benefits totaled $1.1 million and $0.3 million in 2023 and 2022,

respectively.

For further information, see Note 8 under “Notes to Consolidated Financial Statements.”

As a result of the foregoing, net income decreased to $102.8 million in 2022 from $157.5 million in 2021, a decrease of $54.7 million, or 34.7%.

As a result of the foregoing, net income increased to $181.4 million in 2023 from $102.8 million in 2022, an increase of $78.6 million, or 76.5%.

Adjusted EBITDA

Adjusted EBITDA decreased to $168.9 million in 2022 from $237.3 million in 2021, a decrease of $68.4 million, or 28.8%.

Adjusted EBITDA increased to $275.2 million in 2023 from $168.9 million in 2022, an increase of $106.3 million, or 62.9%.

Liquidity and Capital Resources

Our primary sources of liquidity are net cash flows provided by operating activities and available borrowings under our $100.0 million Revolving Credit Facility.

As of January 28, 2023, we had $270.8 million of cash

As of February 3, 2024, we had $353.2 million of cash

and cash equivalents and short-term investments on hand and $90.0 million available to borrow under our Revolving Credit Facility.

For further information regarding our Revolving Credit Facility, see Note 7 under “Notes to the Consolidated Financial

Our primary cash needs are for capital expenditures and working capital.

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We opened 45 new

stores and closed three stores, two in connection with relocations during 2022.

Capital expenditures in 2023 are planned to be approximately $125 million, primarily for the construction of our fourth distribution center and the expansion of the Company’s York, PA distribution center, as well as

the opening of 45 new stores, store-level initiatives at our existing stores, as well as general corporate capital expenditures, including information technology.

Once complete, the 201,000 square foot expansion of our York, PA distribution center,

will provide us the capacity for an additional 50 stores upon completion.

We have experienced, and may continue to experience, delays in construction and permitting of new stores and other projects.

stores and closed one store in 2023.

Capital expenditures in 2024 are planned to be approximately $85 million, primarily for the construction of our fourth distribution center, which is anticipated to be operational in

the second half of fiscal 2024 , as well as the opening of 50 new stores, store-level initiatives at our existing stores, as well as general corporate capital expenditures, including information technology.

We have experienced, and may

continue to experience, delays in construction and permitting of new stores and other projects.

Our primary working capital requirements are for the purchase of merchandise inventories, payroll, store rent associated with our operating leases, other store operating costs, distribution costs, and general and

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pursuant to the Company’s share repurchase program, expiring on December 15, 2023.

The shares to be repurchased may be purchased from time to time in open market conditions (including blocks), privately negotiated transactions, accelerated share

repurchase programs or other derivative transactions, issuer self-tender offers or any combination of the foregoing.

The timing of repurchases and the actual amount purchased will depend on a variety of factors, including the market price of our

shares, general market, economic and business conditions, and other corporate considerations.

Repurchases may be made pursuant to plans intended to comply with Rule 10b5-1 under the Securities Exchange Act of 1934, which could allow us to purchase

our shares during periods when we otherwise might be prevented from doing so under insider trading laws or because of self-imposed trading blackout periods.

Repurchases are expected to be funded from cash on hand or through the utilization of our

Revolving Credit Facility.

The repurchase authorization does not require the purchase of a specific number of shares and is subject to suspension or termination by our Board of Directors at any time.

On November 30, 2023, the Company’s Board of Directors authorized an extension to the existing share repurchase program set to expire on December 15, 2023, until

March 31, 2026.

The shares to be repurchased may be purchased from time to time in open market conditions (including blocks), privately negotiated transactions, accelerated share repurchase programs or other derivative transactions, issuer

self-tender offers or any combination of the foregoing.

The timing of repurchases and the actual amount purchased will depend on a variety of factors, including the market price of our shares, general market, economic and business conditions, and

other corporate considerations.

Repurchases may be made pursuant to plans intended to comply with Rule 10b5-1 under the Securities Exchange Act of 1934, which could allow us to purchase our shares during periods when we otherwise might be prevented

from doing so under insider trading laws or because of self-imposed trading blackout periods.

Repurchases are expected to be funded from cash on hand or through the utilization of our Revolving Credit Facility.

The repurchase authorization does not

require the purchase of a specific number of shares and is subject to suspension or termination by our Board of Directors at any time.

During 2023, we repurchased 808,669 shares of our common stock for $52.5 million, inclusive of transaction costs, pursuant to our share repurchase program, and during 2022, we repurchased 848,133 shares of our common

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These expenditures were funded by cash generated from operations.

As of January 28, 2023, we had approximately $138.2 million remaining under our share repurchase authorization.

be no assurances that any additional repurchases will be completed, or as to the timing or amount of any repurchases.

As of February 3, 2024, we had approximately $85.7 million remaining under our share repurchase authorization.

no assurances that any additional repurchases will be completed, or as to the timing or amount of any repurchases.

Summary of Cash Flows

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Net cash used in financing activities

Net decrease in cash and cash equivalents

Net increase (decrease) in cash and cash equivalents

Cash Provided by Operating Activities

Net cash provided by operating activities in 2023 totaled $254.5 million compared with $114.3 million in 2022.

The increase in net cash provided by operating activities in 2022 was primarily due to decreased working

capital needs, largely due to a substantial increase in capitalized costs in inventory, as well as the timing of inventory receipts and payments, partially offset a decrease in net income year over year.

The increase in net cash provided by operating activities in 2023 was primarily due to higher net income

year over year.

Cash Used in Investing Activities

Net cash used in investing activities totaled $150.1 million in 2023 compared with $111.5 million in 2022.

The increase in cash used in investing activities is primarily due to purchases of short-term investments of

$60.2 million in addition to an increase in cash used for capital expenditures in the current year.

The increase in cash used in investing activities is primarily due to a larger investment in capital

expenditures related to the completion of the Company’s distribution center expansion in York, PA and the construction of our new distribution center in Princeton, IL, and purchases of short-term investments of $273.5 million in the current year,

partially offset by maturities of short-term investments of $247.4 million.

Cash Used in Financing Activities

Net cash used in financing activities totaled $48.7 million in 2023 compared with $39.3 million in 2022.

The change in cash outflow in 2022 is primarily due to $41.8 million paid for the repurchase of the Company’s

shares in fiscal 2022 as compared to share repurchases of $220.0 million in fiscal 2021.

The change in cash outflow in 2023 is primarily due to $52.5 million of shares repurchased in fiscal 2023 as

compared to share repurchases of $41.8 million in fiscal 2022.

Credit Facilities

The Company’s credit facility (the “Credit Facility”) provides for a five-year $100.0 million revolving credit facility (the “Revolving Credit Facility”), which includes a $45.0 million sub-facility for

letters of credit and a $25.0 million sub-facility for swingline loans.

The loans under the Revolving Credit Facility mature on May 22, 2024.

In addition, we may at any time add term loan facilities or additional revolving commitments up to $150.0

million pursuant to terms and conditions set out in the Credit Facility.

As a result of the anticipated discontinuation of LIBOR in 2023, on January 24, 2023, we amended our Credit Facility to replace the LIBOR-based interest rates included therein with SOFR-based interest rates and to

modify the provisions for determining an alternative rate of interest upon the occurrence of certain events relating to the availability of interest rate benchmarks.

The Company’s credit facility (the “Credit Facility”) provides for a five-year $100.0 million revolving credit facility, which includes a $45.0 million sub-facility for letters of credit and a $25.0

million sub-facility for swingline loans (the “Revolving Credit Facility”).

In addition, the Company may at any time add term loan facilities or additional revolving commitments up to $150.0 million pursuant to terms and conditions set out in the

Credit Facility.

On January 9, 2024, the Company refinanced its credit facility (the “Credit Facility”), pursuant to which the maturity date for any loans under the revolving credit facility was extended for a period of five years and a zero percent

(0.0%) interest rate floor was added to the option for the SOFR Loan Rate (as defined in the Amendment).

Loans under the Revolving Credit Facility mature on January 9, 2029.

The interest rates for the Credit Facility are calculated as follows:

for ABR Loans,

the highest of the Prime Rate, the Federal Funds Effective Rate plus 0.50% and Term SOFR with a term of one-month in effect on such day plus the SOFR Spread Adjustment plus 1.0%, plus the Applicable Margin, or, for SOFR Loans, the SOFR Loan Rate plus

the Applicable Margin plus the SOFR Spread Adjustment.

The Applicable Margin will vary from 0.00% to 0.50% for an ABR Loan and 1.00% to 1.50% for a SOFR Loan, based on availability under the Credit Facility.

The SOFR Loan Rate is subject to a 0%

Under the terms of the Revolving Credit Facility, as of January 28, 2023, we could borrow up to 90.0% of the most recent appraised value (valued at cost, discounted for the current net orderly liquidation value) of our

for ABR Loans, the highest of the Prime Rate, the Federal Funds Effective Rate plus 0.50% and Term SOFR with a term of one-month in effect on such

day plus the SOFR Spread Adjustment plus 1.0%, plus the Applicable Margin, or, for SOFR Loans, the SOFR Loan Rate plus the Applicable Margin plus the SOFR Spread Adjustment.

The Applicable Margin will vary from 0.00% to 0.50% for an ABR Loan and

1.00% to 1.50% for a SOFR Loan, based on availability under the Credit Facility.

The SOFR Loan Rate is subject to a 0% floor.

Under the terms of the Revolving Credit Facility, as of February 3, 2024, we could borrow up to 90.0% of the most recent appraised value (valued at cost, discounted for the current net orderly liquidation value) of our

eligible inventory, as defined, up to $100.0 million.

As of January 28, 2023, we had no outstanding borrowings under the Revolving Credit Facility, with $87.0 million of borrowing availability, outstanding letters of credit commitments of $12.8 million and $0.2 million of

As of February 3, 2024, we had no outstanding borrowings under the Revolving Credit Facility, with $90.0 million of borrowing availability, outstanding letters of credit commitments of $9.7 million and $0.2 million of

rent reserves.

The Revolving Credit Facility also contains a variable unused line fee ranging from 0.125% to 0.250% per annum.

We incurred unused line fees of $0.1 million in each of 2022 and 2021.

We incurred unused line fees of approximately $0.1 million in each of 2023 and 2022.

The Credit Facility is collateralized by the Company’s assets and equity and contains a financial covenant, as well as certain business covenants, including restrictions on dividend payments, which we must comply with

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Credit Facility during 2023.

The provisions of the Credit Facility restrict all of the net assets of the Company’s consolidated subsidiaries, which constitutes all of the net assets on our consolidated balance sheet as of January 28, 2023 from

being used to pay any dividends or make other restricted payments to the Company without prior written consent from the financial institutions that are a party to the Credit Facility, subject to material exceptions including proforma compliance with

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We enter into long-term contractual obligations and commitments in the normal course of business, primarily operating leases.

The following table summarizes our material cash requirements over the next several periods

from known contractual obligations, including contractual lease obligations:

Less than 1 year

The following table summarizes our material cash requirements over the next several periods from known contractual

obligations, including contractual lease obligations:

(in thousands)

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Operating lease payments exclude $26.6 million of legally binding minimum lease payments for leases signed, but not yet commenced.

Purchase obligations represent $3.0 million associated with a construction agreement for the expansion of our York, PA distribution center (entered into on March 7, 2022) and

$1.3 million associated with the purchase agreement for the purchase of a parcel of land in Princeton, IL for our fourth distribution center (fully executed on October 17, 2022).

Purchase obligations are primarily for materials and construction agreement for our fourth distribution center in Princeton, IL.

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial

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higher than anticipated levels of shrinkage were to occur, it could have a material effect on our results of operations.

We calculate our shrink provision based on actual physical inventory results during the fiscal period and an accrual for

estimated shrink occurring subsequent to a physical inventory through the end of the fiscal reporting period.

This accrual is calculated as a percentage of sales for each retail store, at a department level, based on the company’s most recent

historical shrink rate adjusted, if necessary, for current economic conditions and business trends.

To the extent that subsequent physical inventories yield different results than the estimated accrual, our effective shrink rate for a given reporting

period will include the impact of adjusting to the actual results.

We have not made any material changes in the methodology used to recognize permanent markdowns or inventory shrinkage in the financial periods presented nor do we anticipate material changes in

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As previously stated, however, if our actual experience does not accurately reflect our assumptions and forecasts, we may be exposed to losses or gains that could be material.

10% change in our assumptions as of January 28, 2023 would have impacted net income by approximately $0.8 million in 2022.

10% change in our assumptions as of February 3, 2024 would have impacted net income by approximately $1.0 million in 2023.

Goodwill/Intangible Assets

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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-K

Item 7. Management’s Discussion and Analysis