What changed in this filing

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Item 1. Financial Statements

2021-05-06 compared with 2020-11-05 · 187 added, 271 removed, 290 unchanged (61% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

Third Quarter Ended Nine Months Ended

(thousands except per share data) September 27, 2020 September 29, 2019 September 27, 2020 September 29, 2019

First Quarter Ended

(thousands except per share data) March 28, 2021 March 29, 2020

NET SALES $ 850,483 $ 589,232

18 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)

Third Quarter Ended Nine Months Ended

(thousands) September 27, 2020 September 29, 2019 September 27, 2020 September 29, 2019

First Quarter Ended

(thousands) March 28, 2021 March 29, 2020

NET INCOME $ 47,513 $ 21,187

Other comprehensive (loss) income, net of tax:

Other comprehensive income (loss), net of tax:

Unrealized gain (loss) of hedge derivatives 975 ( 3,006 )

4 unchanged sentences

PATRICK INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Unaudited)

(thousands) September 27, 2020 December 31, 2019

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

(thousands) March 28, 2021 December 31, 2020

Current Assets

33 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

Nine Months Ended

(thousands) September 27, 2020 September 29, 2019

First Quarter Ended

(thousands) March 28, 2021 March 29, 2020

CASH FLOWS FROM OPERATING ACTIVITIES

4 unchanged sentences

Amortization of convertible notes debt discount 1,769 1,723

Deferred income taxes ( 4,057 ) ( 794 )

Other 3,521 235

Other non-cash items 1,595 750

Change in operating assets and liabilities, net of acquisitions of businesses:

6 unchanged sentences

Capital expenditures ( 14,239 ) ( 7,580 )

Proceeds from sale of property, equipment and other investing activities 117 4,509

Proceeds from sale of property, plant and equipment 58 21

Business acquisitions, net of cash acquired ( 28,864 ) ( 24,281 )

Other ( 2,000 ) —

Net cash used in investing activities ( 45,045 ) ( 31,840 )

CASH FLOWS FROM FINANCING ACTIVITIES

Term debt borrowings — 7,500

Term debt repayments ( 2,500 ) ( 3,750 )

Borrowings on revolver 117,475 6,720

1 unchanged sentence

Stock repurchases under buyback program — ( 15,550 )

Proceeds from issuance of senior notes — 300,000

Cash dividends paid to shareholders ( 6,573 ) ( 5,837 )

Payments related to vesting of stock-based awards, net of shares tendered for taxes ( 2,910 ) ( 3,359 )

Payment of deferred financing costs ( 58 ) ( 7,214 )

Proceeds from exercise of stock options 642 6

Taxes paid for share-based payment arrangements ( 14,464 ) ( 2,747 )

Payment of deferred financing costs and other — ( 57 )

Payment of contingent consideration from a business acquisition — ( 2,000 )

Net cash (used in) provided by financing activities ( 44,377 ) 27,852

Increase (decrease) in cash and cash equivalents ( 77,043 ) 109,817

Proceeds from exercise of common stock options 4,194 —

Net cash used in financing activities ( 43,843 ) ( 26,191 )

Decrease in cash and cash equivalents ( 38,596 ) ( 44,867 )

Cash and cash equivalents at beginning of year 44,767 139,390

Cash and cash equivalents at end of period $ 6,171 $ 94,523

Supplemental Cash Flow Information:

Increase (decrease) in accrued capital expenditures $ ( 2,816 ) $ 57

See accompanying Notes to Condensed Consolidated Financial Statements.

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited)

Third Quarter Ended September 27, 2020

First Quarter Ended March 28, 2021

(thousands) Common

Stock Additional

Capital Accumulated

Comprehensive

Loss Retained

Stock Additional Paid-in-Capital Accumulated Other

Comprehensive Loss Retained

Earnings Total

Balance June 28, 2020 $ 173,178 $ 24,534 $ ( 8,292 ) $ 303,848 $ 493,268

Balance December 31, 2020 $ 180,892 $ 24,387 $ ( 6,052 ) $ 360,214 $ 559,441

— — — 47,513 47,513

2 unchanged sentences

Other comprehensive income, net of tax — — 916 — 916

— — 1,049 — 1,049

Share repurchases under buyback program ( 647 ) ( 94 ) — ( 3,995 ) ( 4,736 )

Shares used to pay taxes on stock grants

Repurchases of shares for tax payments related to the vesting and exercise of share-based grants ( 14,464 ) — — — ( 14,464 )

Issuance of shares upon exercise of common stock options

4,194 — — — 4,194

Stock-based compensation expense 4,298 — — — 4,298

Balance September 27, 2020 $ 177,308 $ 24,440 $ ( 7,243 ) $ 331,324 $ 525,829

Nine Months Ended September 27, 2020

Balance March 28, 2021 $ 174,920 $ 24,387 $ ( 5,136 ) $ 401,104 $ 595,275

First Quarter Ended March 29, 2020

(thousands) Common

Stock Additional

Capital Accumulated

Comprehensive

Loss Retained

Stock Additional Paid-in-Capital Accumulated Other

Comprehensive Loss Retained

Earnings Total

4 unchanged sentences

Share repurchases under buyback program ( 3,315 ) ( 480 ) — ( 11,755 ) ( 15,550 )

Issuance of shares upon exercise of common stock options

642 — — — 642

Shares used to pay taxes on stock grants ( 3,211 ) — — — ( 3,211 )

Stock-based compensation expense 11,177 — — — 11,177

Balance September 27, 2020 $ 177,308 $ 24,440 $ ( 7,243 ) $ 331,324 $ 525,829

Third Quarter Ended September 29, 2019

(thousands) Common

Stock Additional

Capital Accumulated

Comprehensive

Loss Retained

Earnings Total

Balance June 30, 2019 $ 166,086 $ 25,124 $ ( 5,732 ) $ 273,139 $ 458,617

— — — 21,317 21,317

Other comprehensive loss, net of tax

— — ( 221 ) — ( 221 )

Stock repurchases under buyback program ( 674 ) ( 104 ) — ( 2,805 ) ( 3,583 )

Shares used to pay taxes on stock grants

( 59 ) — — — ( 59 )

Stock-based compensation expense 3,867 — — — 3,867

Balance September 29, 2019 $ 169,220 $ 25,020 $ ( 5,953 ) $ 291,651 $ 479,938

PATRICK INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited) (cont.)

Nine Months Ended September 29, 2019

(thousands) Common

Stock Additional

Capital Accumulated

Comprehensive

Loss Retained

Earnings Total

Balance December 31, 2018 $ 161,436 $ 25,124 $ ( 2,680 ) $ 224,874 $ 408,754

— — — 69,582 69,582

Other comprehensive loss, net of tax

— — ( 3,273 ) — ( 3,273 )

Stock repurchases under buyback program ( 674 ) ( 104 ) — ( 2,805 ) ( 3,583 )

Shares used to pay taxes on stock grants ( 3,587 ) — — — ( 3,587 )

Issuance of shares upon exercise of common stock options 6 — — — 6

Repurchases of shares for tax payments related to the vesting and exercise of share-based grants ( 3,032 ) — — — ( 3,032 )

Stock-based compensation expense 4,311 — — — 4,311

Balance September 29, 2019 $ 169,220 $ 25,020 $ ( 5,953 ) $ 291,651 $ 479,938

Balance March 29, 2020 $ 170,626 $ 24,534 $ ( 8,741 ) $ 308,957 $ 495,376

See accompanying Notes to Condensed Consolidated Financial Statements

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The accompanying unaudited condensed consolidated financial statements of Patrick Industries, Inc.

(“Patrick”, the “Company”, "we", "our") contain all adjustments (consisting of normal recurring adjustments) that we believe are necessary to present fairly the Company’s financial position as of September 27, 2020 and December 31, 2019, its results of operations for the third quarter and nine months ended September 27, 2020 and September 29, 2019 and its statements of cash flows for the nine months ended September 27, 2020 and September 29, 2019.

(“Patrick”, the “Company”, "we", "our") contain all adjustments (consisting of normal recurring adjustments) that we believe are necessary to present fairly the Company’s financial position as of March 28, 2021 and December 31, 2020, and its results of operations and cash flows for the three months ended March 28, 2021 and March 29, 2020.

Patrick’s unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission and in accordance with accounting principles generally accepted in the United States of America (“U.S.

The preparation of the condensed consolidated financial statements in conformity with U.S.

GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes.

GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes.

Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S.

GAAP have been condensed or omitted pursuant to those rules or regulations.

Certain immaterial reclassifications have been made to the prior period presentation to conform to the current period presentation of accumulated other comprehensive income in Note 11.

For a description of significant accounting policies used by the Company in the preparation of its consolidated financial statements, please refer to Note 1 to the Consolidated Financial Statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020.

The December 31, 2019 condensed consolidated statement of financial position data was derived from audited financial statements, but does not include all disclosures required by U.S.

Operating results for the third quarter and nine months ended September 27, 2020 are not necessarily indicative of the results to be expected for the full year ending December 31, 2020.

The December 31, 2020 condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by U.S.

Operating results for the first quarter ended March 28, 2021 are not necessarily indicative of the results to be expected for the full year ending December 31, 2021.

The Company maintains its financial records on the basis of a fiscal year ending on December 31, with the fiscal quarters spanning approximately thirteen weeks.

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The second and third quarters are thirteen weeks in duration and the fourth quarter is the remainder of the year.

The third quarter of fiscal year 2020 ended on September 27, 2020 and the third quarter of fiscal year 2019 ended on September 29, 2019.

In preparation of Patrick’s condensed consolidated financial statements as of and for the third quarter and nine months ended September 27, 2020, management evaluated all subsequent events and transactions that occurred after the balance sheet date through the date of issuance of the Form 10-Q that required recognition or disclosure in the condensed consolidated financial statements.

The first quarter of fiscal year 2021 ended on March 28, 2021 and the first quarter of fiscal year 2020 ended on March 29, 2020.

In preparation of Patrick’s condensed consolidated financial statements as of and for the three months ended March 28, 2021, management evaluated all subsequent events and transactions that occurred after the balance sheet date through the date of issuance of the Form 10-Q that required recognition or disclosure in the condensed consolidated financial statements.

See Note 17 for more information.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

Goodwill Impairment

In January 2017, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2017-04, " Intangibles-Goodwill and Other (Topic 350):

Simplifying the Test for Goodwill Impairment ".

This ASU simplifies the accounting for goodwill impairments by eliminating step two from the goodwill impairment test.

The standard requires that the impairment loss be measured as the excess of the reporting unit's carrying amount over its fair value.

It eliminates the second step that requires the impairment to be measured between the implied value of a reporting unit's goodwill and its carrying value.

The Company adopted ASU 2017-04 on January 1, 2020 and the adoption did not have a material impact on the condensed consolidated financial statements.

Credit Losses

In June 2016, the FASB issued ASU 2016-13, “ Financial Instruments – Credit Losses:

Measurement of Credit Losses on Financial Instruments ”, which amends certain provisions of Accounting Standards Codification ("ASC") 326, “Financial Instruments-Credit Loss”.

The ASU changes the impairment model for most financial assets and certain other instruments.

For trade and other receivables, held to maturity debt securities, loans and other instruments, entities are required to use a

new forward-looking “expected loss” model that generally will result in the earlier recognition of allowances for losses.

Additionally, entities are required to disclose more information with respect to credit quality indicators, including information used to track credit quality by year of origination for most financing receivables.

The Company adopted ASU 2016-13 on January 1, 2020 and the adoption did not have a material impact on the condensed consolidated financial statements.

In December 2019, the FASB issued ASU 2019-12, " Income Taxes (Topic 740):

In December 2019, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2019-12, " Income Taxes (Topic 740):

Simplifying the Accounting for Income Taxes ", a new standard to simplify the accounting for income taxes.

2 unchanged sentences

The standard is effective for fiscal years beginning after December 15, 2020, with early adoption permitted.

We are currently evaluating the impact of this standard on our consolidated financial statements.

The Company adopted ASU 2019-12 on January 1, 2021 and the adoption did not have a material effect on its condensed consolidated financial statements.

Reference Rate Reform

5 unchanged sentences

The guidance is effective upon issuance and generally can be applied through December 31, 2022.

We are currently evaluating the impact of this standard on our consolidated financial statements.

We are currently evaluating the impact of this standard on our condensed consolidated financial statements.

Accounting for Convertible Instruments and Contracts in an Entity's Own Equity

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The guidance eliminates certain requirements that require separate accounting for embedded conversion features and simplifies the settlement assessment that entities are required to perform to determine whether a contract qualifies for equity classification.

In addition, the new guidance requires entities use the if-converted method for all convertible instruments in the diluted EPS calculation and include the effect of potential share settlement for instruments that may be settled in cash or shares, with certain exceptions.

In addition, the new guidance requires entities use the if-converted method for all convertible instruments in the diluted net income per share calculation and include the effect of potential share settlement for instruments that may be settled in cash or shares, with certain exceptions.

Furthermore, the guidance requires new disclosures about events that occur during the reporting period that cause conversion contingencies to be met and about the fair value of convertible debt at the instrument level, among other things.

The guidance is effective for fiscal years beginning after December 15, 2021, with early adoption permitted.

We are currently evaluating the impact of this standard on our consolidated financial statements.

We are currently evaluating the impact of this standard on our condensed consolidated financial statements.

At this point in time, we anticipate the primary impact on our condensed consolidated financial statements as a result of the adoption of ASU 2020-06 will be a reduction in non-cash interest expense as well as a reduction in diluted net income per share attributable to the application of the if-converted method for our convertible notes discussed in Note 9.

REVENUE RECOGNITION

In the following table, revenue from contracts with customers, net of intersegment sales, is disaggregated by market type and by reportable segment, consistent with how the Company believes the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors:

Third Quarter Ended September 27, 2020

First Quarter Ended March 28, 2021

(thousands) Manufacturing Distribution Total

Recreational Vehicle $ 329,612 $ 171,814 $ 501,426

Manufactured Housing 45,845 61,908 107,753

Industrial 69,242 9,090 78,332

Marine 132,338 4,471 136,809

Total $ 494,274 $ 206,433 $ 700,707

Nine Months Ended September 27, 2020

(thousands) Manufacturing Distribution Total

Recreational Vehicle $ 656,739 $ 288,778 $ 945,517

Manufactured Housing 56,634 64,084 120,718

Industrial 82,172 9,358 91,530

Marine 219,150 11,400 230,550

Total $ 600,756 $ 249,727 $ 850,483

Third Quarter Ended September 29, 2019

First Quarter Ended March 29, 2020

(thousands) Manufacturing Distribution Total

Recreational Vehicle $ 226,785 $ 93,435 $ 320,220

Manufactured Housing 44,159 64,959 109,118

Industrial 64,541 7,566 72,107

Marine 75,429 2,622 78,051

Total $ 399,712 $ 166,474 $ 566,186

Nine Months Ended September 29, 2019

(thousands) Manufacturing Distribution Total

Recreational Vehicle $ 694,261 $ 299,115 $ 993,376

Manufactured Housing 45,605 66,764 112,369

Industrial 71,447 7,145 78,592

Marine 246,017 9,712 255,729

Total $ 419,266 $ 169,966 $ 589,232

2 unchanged sentences

Inventories consist of the following:

(thousands) September 27, 2020 December 31, 2019

(thousands) March 28, 2021 December 31, 2020

Raw materials $ 174,676 $ 157,219

8 unchanged sentences

GOODWILL AND INTANGIBLE ASSETS

Changes in the carrying amount of goodwill for the nine months ended September 27, 2020 by segment are as follows:

Changes in the carrying amount of goodwill for the three months ended March 28, 2021 by segment are as follows:

(thousands) Manufacturing Distribution Total

2 unchanged sentences

Adjustments to preliminary purchase price allocations 5,688 — 5,688

Balance - September 27, 2020 $ 294,781 $ 61,652 $ 356,433

Intangible assets, net consist of the following as of September 27, 2020 and December 31, 2019:

(thousands) September 27,

2020 December 31,

Balance - March 28, 2021 $ 347,627 $ 57,755 $ 405,382

Intangible assets, net consist of the following as of March 28, 2021 and December 31, 2020:

(thousands) March 28, 2021 December 31, 2020

Customer relationships $ 466,458 $ 461,754

5 unchanged sentences

Intangible assets, net $ 451,269 $ 456,276

Changes in the carrying value of intangible assets for the nine months ended September 27, 2020 by segment are as follows:

Changes in the carrying value of intangible assets for the three months ended March 28, 2021 by segment are as follows:

(thousands) Manufacturing Distribution Total

Balance - December 31, 2020 $ 373,717 $ 82,559 $ 456,276

Acquisitions and other 36,409 13,096 49,505

Acquisitions 11,988 — 11,988

Amortization ( 9,874 ) ( 2,032 ) ( 11,906 )

Impairment of intangible assets (1)

( 119 ) ( 1,831 ) ( 1,950 )

Adjustments to preliminary purchase price allocations ( 5,089 ) — ( 5,089 )

Balance - September 27, 2020 $ 300,195 $ 80,724 $ 380,919

(1) Certain immaterial operations permanently ceased activities during the nine months ended September 27, 2020.

As a result, we recorded a $ 2.0 million pre-tax impairment of customer relationships and trademarks of these operations after determining the net carrying value of the assets was no longer recoverable.

The impairment was calculated using our internal projections of discounted cash flows, which rely on Level 3 inputs in the fair value hierarchy based on the unobservable nature of the underlying data.

The impairment was recorded in selling, general and administrative in our condensed consolidated statements of income for the nine months ended September 27, 2020.

Valuation of Goodwill and Indefinite-Lived Intangibles

We test goodwill and indefinite-lived intangible assets (trademarks) for impairment on an annual basis (as of September 30, 2019 for our most recent annual tests) and, if certain events or circumstances indicate that an impairment loss may have been incurred, on an interim basis.

Our 2019 tests indicated that there was no impairment, as fair value exceeded carrying values, and we concluded that none of our reporting units or trademarks were at risk of failing the impairment test.

Despite the excess fair value identified in our 2019 impairment tests, we assessed during the quarter and nine months ended September 27, 2020 whether the impact of the COVID-19 pandemic on overall macroeconomic conditions and our results of operations for the third quarter and nine months ended September 27, 2020 indicated that at September 27, 2020 it was more likely than not that our goodwill and trademarks were impaired.

We evaluated among other factors (i) the results of our 2019 impairment tests;

(ii) our market capitalization at September 27, 2020 in relation to the carrying amount of shareholders’ equity at September 27, 2020 and to fair values determined during our 2019 impairment tests;

(iii) the results of our operations during the third quarter and nine months ended September 27, 2020 in relation to our projections;

and (iv) our analysis of the impact on the fair values determined during our 2019 impairment tests using more recent projections and discount rates that account for various risks and uncertainties, including the duration and extent of impact to our business, related to the COVID-19 pandemic.

Based on the results of our assessment, and other than immaterial impairments discussed above, we concluded that no triggering events had occurred which would indicate the fair values of our goodwill and trademarks may be less than the carrying values at September 27, 2020.

However, we are unable to predict how long the COVID-19-related conditions will persist, what additional measures may be introduced by governments or private parties, or what effect any such additional measures may have on demand for our products or those of our customers in each of our end markets.

As such, the outcome of our 2020 impairment tests, which we will perform in the fourth quarter of 2020, could result in an impairment of our goodwill or our trademarks.

The Company completed six acquisitions in the third quarter of 2020 and completed nine acquisitions in the first nine months of 2020 (the "2020 Acquisitions").

For the third quarter and nine months ended September 27, 2020, net sales included in the Company's condensed consolidated statements of income related to the 2020 Acquisitions were $ 19.6 million and $ 23.3 million, respectively.

Operating income related to the 2020 Acquisitions for the third quarter and nine months ended September 27, 2020 was approximately $ 2.1 million and $ 2.2 million, respectively.

Acquisition-related costs incurred in the first nine months of 2020 were immaterial.

The Company completed two acquisitions in the first nine months of 2019.

For the third quarter and first nine months ended September 29, 2019, revenue and operating income included in the Company's condensed consolidated statements of income were immaterial.

Acquisition-related costs incurred in the first nine months of 2019 were immaterial.

As of September 27, 2020, the aggregate fair value of the estimated contingent consideration payments was $ 8.0 million, $ 6.1 million of which is included in the line item "Accrued liabilities" and $ 1.9 million is included in “Other long-term liabilities” on the condensed consolidated statement of financial position.

Balance - March 28, 2021 $ 370,742 $ 80,527 $ 451,269

The Company completed four acquisitions in the first quarter of 2021 (the "2021 Acquisitions").

For the first quarter ended March 28, 2021, net sales included in the Company's condensed consolidated statement of income related to the 2021 Acquisitions were $ 5.4 million and operating income was immaterial.

Acquisition-related costs associated with the businesses acquired in the first quarter of 2021 were immaterial.

Assets acquired and liabilities assumed in the individual acquisitions were recorded on the Company’s condensed consolidated balance sheet at their estimated fair values as of the respective dates of acquisition.

For each acquisition, the Company completes its allocation of the purchase price to the fair value of acquired assets and liabilities within the one year measurement period.

The Company completed three acquisitions in the first quarter of 2020.

Net sales and operating income included in the Company's condensed consolidated statement of income related to the 2020 Acquisitions in the first quarter ended March 29, 2020 were immaterial.

For each acquisition, the excess of the purchase consideration over the fair value of the net assets acquired is recorded as goodwill, which generally represents the combined value of the Company’s existing purchasing, manufacturing, sales, and systems resources with the organizational talent and expertise of the acquired companies’ respective management teams to maximize efficiencies, revenue impact, market share growth and net income.

In connection with certain acquisitions, if certain financial targets for the acquired businesses are achieved, the Company is required to pay additional cash consideration.

The Company records a liability for the fair value of the contingent consideration related to each of these acquisitions as part of the initial purchase price based on the present value of the expected future cash flows and the probability of future payments at the date of acquisition.

As of March 28, 2021, the aggregate fair value of the estimated contingent consideration payments was $ 6.9 million, $ 3.3 million of which is included in the line item "Accrued liabilities" and $ 3.6 million is included in “Other long-term liabilities” on the condensed consolidated balance sheet.

At December 31, 2020, the aggregate fair value of the estimated contingent consideration payments was $ 6.9 million, $ 1.6 million of which was included in the line item "Accrued liabilities" and $ 5.3 million was included in "Other long-term liabilities".

The liabilities for contingent consideration expire at various dates through December 2023.

The liabilities for contingent

consideration expire at various dates through December 2023.

The contingent consideration arrangements are subject to a maximum payment amount of up to $ 14.5 million in the aggregate.

In the first nine months of 2020, the Company made cash payments of $ 2.0 million related to contingent consideration arrangements, recording a corresponding reduction to accrued liabilities.

In the first quarter of 2021, the Company made no cash payments related to contingent consideration liabilities.

2021 Acquisitions

Acquisitions completed in the first nine months of 2020 include the following previously announced acquisitions:

Company Description

Maple City Woodworking Corporation Manufacturer of hardwood cabinet doors and fascia for the recreational vehicle ("RV") market based in Goshen, Indiana

SEI Manufacturing, Inc.

Manufacturer of towers, T-Tops, hardtops, rails, gates and other aluminum exterior products for the marine market located in Cromwell, Indiana

Inland Plywood Company Supplier, laminator, and wholesale distributor of treated, untreated, and laminated plywood, medium density overlay panels, and other specialty products, primarily serving the marine market as well as the RV and industrial markets headquartered in Pontiac, Michigan with an additional facility in Cocoa, Florida

Synergy RV Transport Transportation and logistics service provider primarily for original equipment manufacturers and dealers in the RV market located in Goshen, Indiana

Front Range Stone Fabricator and installer of natural stone, quartz, solid surface, and laminate countertops, primarily serving big box home improvement retailers, home builders and commercial contractors in the industrial market based in Englewood, Colorado

Inclusive of four immaterial acquisitions not discussed above, total cash consideration for the 2020 Acquisitions was approximately $ 124 million, plus contingent consideration over a maximum of a one-year period based on future performance in connection with certain acquisitions.

The Company completed the following previously announced acquisition in the three months ended March 28, 2021:

Company Segment Description

Sea-Dog Corporation & Sea-Lect Plastics

(collectively, "Sea-Dog") Distribution & Manufacturing Distributor of a variety of marine and powersports hardware and accessories to distributors, wholesalers, retailer, and manufacturers

Manufacturer that provides plastic injection molding, design, product development and expert tooling to companies and government entities

Inclusive of three immaterial acquisitions not discussed above, total cash consideration for the 2021 Acquisitions was approximately $ 29.5 million.

The preliminary purchase price allocations are subject to valuation activities being finalized, and thus all required purchase accounting adjustments are subject to change within the measurement period as the Company finalizes its estimates.

Changes to preliminary purchase accounting estimates recorded in the third quarter and first nine months of 2020 related to the 2020 Acquisitions were immaterial.

The 2020 Acquisitions are included in the Manufacturing segment except for Synergy RV Transport, which is included in the Distribution segment.

Changes to preliminary purchase accounting estimates recorded in the first quarter ended March 28, 2021 related to the 2021 Acquisitions were immaterial.

2020 Acquisitions

The Company completed four acquisitions in 2019 (the "2019 Acquisitions"), including the previously announced acquisitions of Topline Counters, LLC ("Topline Counters"), a Sumner, Washington-based designer and manufacturer of

kitchen and bathroom countertops for residential and commercial markets, and G.G.

Schmitt & Sons, Inc.

Schmitt"), a Sarasota, Florida-based designer and manufacturer of customized hardware and structural components for the marine industry.

The total cash consideration for the 2019 Acquisitions was $ 53.1 million, plus contingent consideration over a one-year period based on future performance in connection with the acquisition of G.G.

Valuation activities and purchase accounting adjustments have been finalized on all 2019 Acquisitions, except for the finalization of tangible assets for Topline Counters.

Changes to preliminary purchase accounting estimates recorded in the third quarter and first nine months of 2020 related to the 2019 Acquisitions were immaterial.

The 2019 Acquisitions are included in the Manufacturing segment.

The following table summarizes the fair values of the consideration paid, assets acquired, and the liabilities assumed as of the date of acquisition for the 2020 Acquisitions and the 2019 Acquisitions:

The Company completed the following seven previously announced acquisitions in the year ended December 31, 2020 (the "2020 Acquisitions"):

Company Segment Description

Maple City Woodworking Corporation Manufacturing Manufacturer of hardwood cabinet doors and fascia for the RV market based in Goshen, Indiana

SEI Manufacturing, Inc.

Manufacturing Manufacturer of towers, T-Tops, hardtops, rails, gates and other aluminum exterior products for the marine market located in Cromwell, Indiana

Inland Plywood Company Manufacturing Supplier, laminator, and wholesale distributor of treated, untreated, and laminated plywood, medium density overlay panels, and other specialty products, primarily serving the marine market as well as the RV and industrial markets headquartered in Pontiac, Michigan with an additional facility in Cocoa, Florida

Synergy RV Transport Distribution Transportation and logistics service provider primarily for original equipment manufacturers ("OEMs") and dealers in the RV market located in Goshen, Indiana

Front Range Stone Manufacturing Fabricator and installer of natural stone, quartz, solid surface, and laminate countertops, primarily serving big box home improvement retailers, home builders and commercial contractors in the industrial market based in Englewood, Colorado

Geremarie Corporation Manufacturing Designer, manufacturer, and fabricator of a full suite of high-precision aluminum components serving the marine industry, in addition to the medical, aerospace, defense, commercial and industrial markets located in Lake Zurich, Illinois

Taco Metals, LLC Manufacturing Manufacturer of boating products including rub rail systems, canvas and tower components, sport fishing and outrigger systems, helm chairs and pedestals, and specialty hardware for OEMs in the recreational boating industry and the related aftermarket headquartered in Miami, Florida, with manufacturing facilities in Tennessee and Florida, and distribution centers in Tennessee, Florida, South Carolina, and Massachusetts

Inclusive of four immaterial acquisitions not discussed above, total cash consideration for the 2020 Acquisitions was approximately $ 306.4 million, plus contingent consideration over a one to three-year period based on future performance in connection with certain acquisitions.

One acquisition in 2020 accounted for $ 129.7 million of cash consideration, $ 49.3 million of fixed assets, $ 49.1 million of intangible assets and $ 32.6 million of goodwill.

The measurement periods for Maple City Woodworking Corporation and SEI Manufacturing, Inc.

Preliminary purchase price allocations on the remainder are substantially complete, pending valuation activities being finalized on fixed assets in connection with certain acquisitions.

All required purchase accounting adjustments are subject to change within the measurement period as the Company finalizes its estimates.

Changes to preliminary purchase accounting estimates recorded in the first quarter ended March 28, 2021 related to the 2020 Acquisitions were immaterial and relate primarily to the valuation of intangible assets.

The following table summarizes the fair values of the assets acquired and the liabilities assumed as of the date of acquisition for the 2021 Acquisitions and the 2020 Acquisitions:

(thousands) 2021 Acquisitions 2020 Acquisitions

1 unchanged sentence

Cash, net of cash acquired $ 29,539 $ 306,353

Working capital holdback and other, net (1)

Contingent consideration (2)

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Liabilities Assumed

Current portion of operating lease obligations ( 1,068 ) ( 2,721 )

Accounts payable & accrued liabilities ( 2,547 ) ( 12,402 )

Operating lease obligations ( 2,893 ) ( 17,308 )

Deferred tax liabilities, net ( 3,415 ) ( 1,922 )

Deferred tax liabilities — ( 4,322 )

Total fair value of net assets acquired 26,188 222,162

$ 30,082 $ 310,988

$ 125,826 $ 54,467

(1) These amounts reflect the preliminary estimated liability pertaining to the fair value of contingent consideration based on future performance relating to certain acquisitions.

(2) Goodwill is tax-deductible for the 2020 Acquisitions, except Front Range Stone (approximately $ 14.1 million), and for the 2019 Acquisitions, except GG Schmitt (approximately $ 5.4 million).

For acquisitions, the excess of purchase price consideration over the fair value of net assets acquired is recorded as goodwill, which generally represents the combined value of the Company's existing purchasing, manufacturing, sales, industry relationships, and systems resources with the organizational talent and expertise of the acquired companies' respective management teams to maximize efficiencies, revenue impact, market share growth, and net income.

(1) Certain acquisitions contain working capital holdbacks which are typically settled in a 90-day period following the close of the acquisition.

This value represents the remaining amounts due to (from) sellers as of March 28, 2021.

(2) These amounts reflect the acquisition date fair value of contingent consideration based on future performance relating to certain acquisitions.

(3) Goodwill is tax-deductible for the 2021 Acquisitions and the 2020 Acquisitions, except Front Range Stone (approximately $ 10.1 million).

We estimate the value of acquired property, plant, and equipment using a combination of the income, cost, and market approaches, such as estimates of future income growth, capitalization rates, discount rates, and capital expenditure needs of the acquired businesses.

The following table presents our estimates of identifiable intangibles for the 2020 Acquisitions and the 2019 Acquisitions:

Estimated Useful Life (in years) 2020 Acquisitions 2019 Acquisitions

The following table presents our estimates of identifiable intangible assets for the 2021 Acquisitions and the 2020 Acquisitions:

(thousands, except year info) Estimated Useful Life (in years) 2021 Acquisitions 2020 Acquisitions

Customer relationships 10 $ 9,597 $ 99,897

Non-compete agreements 5 393 1,150

Patents 10 — 6,470

Trademarks Indefinite 1,945 23,464

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Pro Forma Information

The following pro forma information for the third quarter and nine months ended September 27, 2020 and September 29, 2019 assumes the 2020 Acquisitions and the 2019 Acquisitions occurred as of the beginning of the year immediately preceding each such acquisition.

The following pro forma information for the first quarter ended March 28, 2021 and March 29, 2020 assumes the 2021 Acquisitions and the 2020 Acquisitions occurred as of the beginning of the year immediately preceding each such acquisition.

The pro forma information contains the actual operating results of the 2021 Acquisitions and 2020 Acquisitions combined with the results prior to their respective acquisition dates, adjusted to reflect the pro forma impact of the acquisitions occurring as of the beginning of the year immediately preceding each such acquisition.

The pro forma information includes financing and interest expense charges based on incremental borrowings incurred in connection with each transaction.

In addition, the pro forma information includes amortization expense, in the aggregate, related to intangible assets acquired in connection with the transactions of $ 0.5 million and $ 2.2 million for the third quarter and nine months ended September 27, 2020, respectively, and $ 1.4 million and $ 4.0 million for the third quarter and nine months ended September 29, 2019, respectively.

Third Quarter Ended Nine Months Ended

(thousands except per share data) September 27, 2020 September 29, 2019 September 27, 2020 September 29, 2019

In addition, the pro forma information includes amortization expense, in the aggregate, related to intangible assets acquired in connection with the transactions of $ 0.1 million and $ 3.0 million for the first quarter ended March 28, 2021 and the first quarter ended March 29, 2020, respectively.

First Quarter Ended

(thousands except per share data) March 28, 2021 March 29, 2020

Revenue $ 857,009 $ 656,107

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STOCK-BASED COMPENSATION

The Company recorded expense of $ 4.9 million and $ 11.2 million for the third quarter and nine months ended September 27, 2020, respectively, for its stock-based compensation plans in the condensed consolidated statements of income.

Stock-based compensation expense for the nine months ended September 27, 2020 includes a reduction of expense due to certain forfeitures and adjustments in the amount of $ 2.3 million.

For the third quarter and nine months ended September 29, 2019, the Company recorded stock-based compensation expense of $ 3.8 million and $ 12.0 million, respectively.

The Board approved various stock-based grants under the Company’s 2009 Omnibus Incentive Plan in the first nine months of 2020 totaling 275,740 shares in the aggregate at an average fair value of $ 53.78 per share at grant date for a total fair value at grant date of $ 14.8 million.

In addition, in the second quarter of 2020, the Board approved stock option grants representing 465,000 shares in the aggregate at an exercise price of $ 41.33 per share.

The total cost to be expensed over the three-year vesting period will be $ 6.6 million, or $ 14.25 per share, with an underlying volatility of 42 % under the Black Scholes option pricing model.

As of September 27, 2020, there was approximately $ 25.5 million of total unrecognized compensation cost related to stock-based compensation arrangements granted under incentive plans.

The Company recorded expense of approximately $ 4.3 million for each of the first quarters ended March 28, 2021 and March 29, 2020, for its stock-based compensation plans in the condensed consolidated statements of income.

The Board approved various stock-based grants under the Company’s 2009 Omnibus Incentive Plan in the first quarter of 2021 totaling 218,254 shares in the aggregate at an average fair value of $ 72.63 at grant date for a total fair value at grant date of $ 15.9 million.

As of March 28, 2021, there was approximately $ 33.9 million of total unrecognized compensation cost related to stock-based compensation arrangements granted under incentive plans.

That cost is expected to be recognized over a weighted-average period of 22.8 months.

NET INCOME PER COMMON SHARE

Net income per common share calculated for the third quarter and nine months of 2020 and 2019 is as follows:

Third Quarter Ended Nine Months Ended

(thousands except per share data) September 27, 2020 September 29, 2019 September 27, 2020 September 29, 2019

Net income per common share calculated for the first quarter of 2021 and 2020 is as follows:

First Quarter Ended

(thousands except per share data) March 28, 2021 March 29, 2020

Net income for basic and diluted per share calculation $ 47,513 $ 21,187

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An immaterial amount of securities was not included in the computation of diluted income per share as they are considered anti-dilutive under the treasury stock method.

A summary of total debt outstanding at September 27, 2020 and December 31, 2019 is as follows:

(thousands) September 27, 2020 December 31, 2019

A summary of total debt outstanding at March 28, 2021 and December 31, 2020 is as follows:

(thousands) March 28, 2021 December 31, 2020

Long-term debt:

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Total long-term debt, less current maturities, net $ 785,849 $ 810,907

There were no material changes to any of our debt arrangements during the third quarter and nine months ended September 27, 2020.

There were no material changes to any of our debt arrangements during the quarter ended March 28, 2021.

See Note 17 for a description of changes to our debt arrangements subsequent to March 28, 2021.

Interest rates for borrowings under the revolver and term loan are the prime rate or LIBOR plus a margin.

At September 27, 2020, all of the Company's borrowings under the revolver and term loan were under the LIBOR-based option.

The interest rate for incremental borrowings at September 27, 2020 was LIBOR plus 1.5 % (or 1.69 %) for the LIBOR-based option.

The fee payable on committed but unused portions of the revolver was 0.20 % at September 27, 2020.

Total cash interest paid was $ 3.2 million and $ 6.9 million for the third quarter of 2020 and 2019, respectively, and $ 21.4 million and $ 19.7 million for the first nine months of 2020 and 2019, respectively.

At March 28, 2021, all of the Company's borrowings under the revolver and term loan were under the LIBOR-based option.

The interest rate for incremental borrowings at March 28, 2021 was LIBOR plus 1.5 % (or 1.63 %) for the LIBOR-based option.

The fee payable on committed but unused portions of the revolver was 0.20 % at March 28, 2021.

Total cash interest paid for the first quarter of 2021 and 2020 was $ 3.3 million and $ 2.6 million, respectively.

DERIVATIVE FINANCIAL INSTRUMENTS

The Company's credit facility exposes the Company to risks associated with the variability in interest expense associated with fluctuations in LIBOR.

To partially mitigate this risk, the Company has historically entered into interest rate swaps.

As of September 27, 2020, the Company had a combined notional principal amount of $ 200.0 million of interest rate swap agreements, all of which are designated as cash flow hedges.

To partially mitigate this risk, the Company entered into interest rate swaps.

As of March 28, 2021, the Company had a combined notional principal amount of $ 200 million of interest rate swap agreements, all of which are designated as cash flow hedges.

These swap agreements effectively convert the interest expense associated with a portion of the Company's variable rate debt from variable interest rates to fixed interest rates and have maturities ranging from February 2022 to March 2022.

The following table summarizes the fair value of derivative contracts included in the condensed consolidated statements of financial position (in thousands):

The following table summarizes the fair value of derivative contracts included in the condensed consolidated balance sheets (in thousands):

Fair value of derivative instruments

Derivatives accounted for as cash flow hedges Balance sheet location September 27, 2020 December 31, 2019

Derivatives accounted

for as cash flow hedges

Balance sheet location March 28, 2021 December 31, 2020

Interest rate swaps Accrued liabilities $ 5,258 $ —

Interest rate swaps Other long-term liabilities $ — $ 6,567

The interest rate swaps are comprised of over-the-counter derivatives, which are valued using models that primarily rely on observable inputs such as yield curves, which are classified as Level 2 in the fair value hierarchy.

See Note 11 for information regarding accumulated other comprehensive loss on interest rate swaps.

The interest rate swaps are comprised of over-the-counter derivatives, which are valued using models that primarily rely on observable inputs such as yield curves and are classified as Level 2 in the fair value hierarchy.

See Note 11 for information regarding accumulated other comprehensive loss on interest rate swaps, which qualify as cash flow hedges.

ACCUMULATED OTHER COMPREHENSIVE LOSS

Accumulated other comprehensive loss includes unrealized gains and losses on derivatives that qualify as hedges of cash flows, cumulative foreign currency translation and other adjustments.

The activity in accumulated other comprehensive loss during the third quarter and nine months ended September 27, 2020 and September 29, 2019 was as follows:

Third Quarter Ended September 27, 2020

(thousands) Cash Flow Hedges Other Foreign Currency Items Total

Balance at June 28, 2020 $ ( 6,916 ) $ ( 1,270 ) $ ( 106 ) $ ( 8,292 )

Other comprehensive income (net of tax of $ 340 , $ 0 and $ 0 )

989 — 60 1,049

Balance at September 27, 2020 $ ( 5,927 ) $ ( 1,270 ) $ ( 46 ) $ ( 7,243 )

Nine Months Ended September 27, 2020

(thousands) Cash Flow Hedges Other Foreign Currency Items Total

Accumulated other comprehensive loss includes unrealized gains and losses on derivatives that qualify as cash flow hedges, cumulative foreign currency translation and other adjustments.

The activity in accumulated other comprehensive loss during the three months ended March 28, 2021 and March 29, 2020 was as follows:

First Quarter Ended March 28, 2021

(thousands) Cash Flow Hedges Other Foreign Currency Translation Total

Balance at December 31, 2020 $ ( 4,889 ) $ ( 1,263 ) $ 100 $ ( 6,052 )

Other comprehensive income (loss) (net of tax benefit of $ 542 , $ 0 and $ 0 )

( 1,553 ) — 8 ( 1,545 )

Balance at September 27, 2020 $ ( 5,927 ) $ ( 1,270 ) $ ( 46 ) $ ( 7,243 )

Third Quarter Ended September 29, 2019

(thousands) Cash Flow Hedges Other Foreign Currency Items Total

Balance at June 30, 2019 $ ( 4,958 ) $ ( 675 ) $ ( 99 ) $ ( 5,732 )

Other comprehensive income (loss) (net of tax benefit of $ 83 , $ 0 and $ 0 )

( 240 ) — 19 ( 221 )

Balance at September 29, 2019 $ ( 5,198 ) $ ( 675 ) $ ( 80 ) $ ( 5,953 )

Nine Months Ended September 29, 2019

Other comprehensive loss before reclassifications, net of tax ( 96 ) — ( 59 ) ( 155 )

Amounts reclassified from accumulated other comprehensive loss, net of tax 1,071 — — 1,071

Net current period other comprehensive income (loss) 975 — ( 59 ) 916

Balance at March 28, 2021 $ ( 3,914 ) $ ( 1,263 ) $ 41 $ ( 5,136 )

First Quarter Ended March 29, 2020

(thousands) Cash Flow Hedges Other Foreign Currency Items Total

Balance at December 31, 2019 $ ( 4,374 ) $ ( 1,270 ) $ ( 54 ) $ ( 5,698 )

Other comprehensive loss (net of tax benefit of $ 1,098 , $ 0 and $ 0 )

( 3,225 ) — ( 48 ) ( 3,273 )

Balance at September 29, 2019 $ ( 5,198 ) $ ( 675 ) $ ( 80 ) $ ( 5,953 )

Reclassification adjustments out of accumulated other comprehensive loss were immaterial for all periods presented.

Other comprehensive loss before reclassifications, net of tax ( 4,077 ) — ( 37 ) ( 4,114 )

Amounts reclassified from accumulated other comprehensive loss, net of tax 1,071 — — 1,071

Net current period other comprehensive loss ( 3,006 ) — ( 37 ) ( 3,043 )

Balance at March 29, 2020 $ ( 7,380 ) $ ( 1,270 ) $ ( 91 ) $ ( 8,741 )

Lease expense, supplemental cash flow information, and other information related to leases were as follows:

Third Quarter Ended

(thousands) September 27, 2020 September 29, 2019

Operating lease cost $ 8,525 $ 7,848

Cash paid for amounts included in the measurement of lease liabilities:

Operating cash flows for operating leases $ 8,317 $ 6,946

Right-of-use assets obtained in exchange for lease obligations:

Operating leases $ 17,091 $ 5,522

Nine Months Ended

(thousands) September 27, 2020 September 29, 2019

First Quarter Ended

(thousands) March 28, 2021 March 29, 2020

Operating lease cost $ 9,585 $ 8,176

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Balance sheet information related to leases was as follows:

(thousands, except lease term and discount rate) September 27, 2020 December 31, 2019

(thousands, except lease term and discount rate) March 28, 2021 December 31, 2020

Operating lease right-of-use assets $ 124,384 $ 117,816

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Weighted average discount rate, operating leases 4.0 % 4.1 %

Maturities of lease liabilities were as follows at September 27, 2020:

2020 (excluding the nine months ended September 27, 2020) $ 8,561

Maturities of lease liabilities were as follows at March 28, 2021:

2021 (excluding the three months ended March 28, 2021)

Thereafter 18,862

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Total $ 125,840

Leases have remaining lease terms of one year to ten years .

As of March 28, 2021, outstanding leases have remaining lease terms ranging from one year to 18 years.

FAIR VALUE MEASUREMENTS

The carrying amounts of cash equivalents, representing government and other money market funds traded in an active market, are reported on the condensed consolidated statements of financial position as a component of "Cash and cash equivalents".

The carrying amount of cash equivalents, valued using Level 1 inputs and approximating fair value because of their relatively short maturities, was approximately $ 31.0 million and $ 132.6 million at September 27, 2020 and December 31, 2019, respectively.

The estimated fair value of our senior notes, calculated using Level 2 inputs, was approximately $ 326.1 million and $ 320.3 million at September 27, 2020 and December 31, 2019, respectively.

The carrying amounts of our term loan and our revolver, valued using Level 2 inputs, approximated fair value as of September 27, 2020 and December 31, 2019 based upon terms and conditions available to the Company at those dates in comparison to the terms and conditions of its outstanding debt.

The estimated fair value of our convertible notes, calculated using Level 2 inputs, was approximately $ 166.9 million and $ 162.5 million as of September 27, 2020 and December 31, 2019, respectively.

The effective tax rate in the third quarter of 2020 and 2019 was 24.3 % and 26.0 %, respectively, and the effective tax rate for the comparable nine month periods was 25.4 % and 24.6 %, respectively.

The effective tax rate for the third quarter of 2020 reflects the impact of certain federal and state income tax benefits and the first nine months of 2020 reflects the impact of $ 2.2 million of permanent tax differences due to certain Coronavirus Aid, Relief, and Economic Security Act payroll tax credits.

In addition, the effective tax rate for the first nine months of 2019 includes the impact of the recognition of excess tax benefits on share-based compensation that was recorded as a reduction to income tax expense upon realization in the amount of $ 0.9 million.

Cash paid for income taxes, net of refunds, was $ 1.8 million and $ 1.6 million for the third quarter and nine months of 2020, respectively, and $ 7.4 million and $ 30.0 million in the third quarter and nine months of 2019, respectively.

The following table presents fair values of certain assets and liabilities at March 28, 2021 and December 31, 2020:

March 28, 2021 December 31, 2020

(in millions) Level 1 Level 2 Level 3 Level 1 Level 2 Level 3

Senior Note (1)

— $ 351.6 — — $ 329.0 —

Convertible Note (1)

— 188.3 — — 180.0 —

Interest Rate Swaps (2)

— 5.3 — — 6.6 —

Contingent consideration (3)

— — $ 6.9 — — $ 6.9

(1) The amounts of these notes listed above are the current fair values for disclosure purposes only, and they are recorded in the Company's condensed consolidated balance sheets as of March 28, 2021 and December 31, 2020 using the interest rate method as described in Note 9.

(2) The interest rate swaps are comprised of over-the-counter derivatives, which are valued using models that primarily rely on observable inputs such as yield curves, and are classified as Level 2 in the fair value hierarchy and discussed further in Note 10.

(3) The estimated fair value of the Company's contingent consideration is valued using Level 3 inputs and is discussed further in Note 6.

The effective tax rate in the first quarter of 2021 and 2020 was 17.1 % and 26.4 %, respectively.

The effective tax rate for the first quarter of 2021 includes the impact of the recognition of excess tax benefits on share-based compensation that was recorded as a reduction to income tax expense upon realization in the amount of $ 5.7 million.

The Company made no income tax payments in the first quarters of 2021 and 2020.

SEGMENT INFORMATION

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The tables below present information about the sales and operating income of those segments.

Third Quarter Ended September 27, 2020

(thousands) Manufacturing Distribution Total

Net outside sales $ 494,274 $ 206,433 $ 700,707

Intersegment sales 12,004 1,640 13,644

Total sales 506,278 208,073 714,351

Operating income 63,312 16,444 79,756

Third Quarter Ended September 29, 2019

(thousands) Manufacturing Distribution Total

Net outside sales $ 399,712 $ 166,474 $ 566,186

Intersegment sales 8,102 1,078 9,180

Total sales 407,814 167,552 575,366

Operating income 42,353 9,041 51,394

Nine Months Ended September 27, 2020

First Quarter Ended March 28, 2021

(thousands) Manufacturing Distribution Total

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Operating income 78,429 21,175 99,604

Nine Months Ended September 29, 2019

First Quarter Ended March 29, 2020

(thousands) Manufacturing Distribution Total

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The following table presents a reconciliation of segment operating income to consolidated operating income:

Third Quarter Ended Nine Months Ended

(thousands) September 27, 2020 September 29, 2019 September 27, 2020 September 29, 2019

First Quarter Ended

(thousands) March 28, 2021 March 29, 2020

Operating income for reportable segments $ 99,604 $ 55,672

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In March 2020, the Board approved a new stock repurchase program for up to $ 50 million of its common stock, including amounts remaining under previous authorizations.

Approximately $ 38.8 million remains available in the amount of the Company's common stock that may be acquired under the current stock repurchase program as of September 27, 2020.

In the third quarter of 2020, the Company repurchased 88,950 shares of its common stock at an average price of $ 53.24 for an aggregate cost of approximately $ 4.7 million.

In the first nine months of 2020, the Company repurchased 545,105 shares of its common stock at an average price of $ 37.22 per share for an aggregate cost of approximately $ 20.3 million.

During the third quarter and first nine months of 2019, the Company repurchased 98,201 shares at an average price of $ 36.50 per share for an aggregate cost of approximately $ 3.6 million.

Approximately $ 36.0 million remains in the amount of the Company's common stock that may be acquired under the current stock repurchase program as of March 28, 2021.

The Company did no t repurchase any of its common stock in the first quarter of 2021.

In the first quarter ended March 29, 2020, the Company repurchased 456,155 shares of its common stock at an average price of $ 34.09 per share at an aggregate cost of $ 15.6 million.

SUBSEQUENT EVENTS

In April 2021, we completed the acquisition of Hyperform Inc., a manufacturer of high-quality, non-slip foam flooring, operating under the SeaDek brand name, for the marine OEM market and aftermarket.

Hyperform also serves the pool and spa, powersports and utility markets under the SwimDek and EndeavorDek brand names (collectively, “SeaDek”).

SeaDek operates out of two manufacturing facilities located in Rockledge, Florida and in Cocoa, Florida.

In April 2021, we completed the acquisition of Alpha Systems, LLC, a manufacturer and distributor of component products and accessories for the recreational vehicle, marine, manufactured housing and industrial end markets.

Products include adhesives, sealants, rubber roofing, roto/blow molding, injection molding, flooring, insulation,

shutters, skylights, and various other products and accessories.

Alpha Systems LLC operates out of nine manufacturing and distribution facilities located in Elkhart, Indiana.

On April 20, 2021, we completed the issuance of $ 350 million aggregate principal amount of senior notes due 2029 in a private placement exempt from registration under the Securities Act of 1933.

The notes, which were priced at par, carry an interest rate of 4.75 %.

Following the completion of the offering, the Company amended and restated the credit agreement governing its existing $ 650 million senior secured credit facility to establish a new $ 700 million senior secured credit facility consisting of a $ 550 million revolving credit facility and a $ 150 million term loan facility.

The maturity date for borrowings under the new senior secured credit facility was extended to April 2026.

The new senior secured credit facility replaced the Company’s previously existing credit facility that was due to mature in September 2024.

In addition to being used to repay a portion of existing borrowings, the net proceeds resulting from these transactions were used for general corporate purposes, including in connection with the acquisitions completed subsequent to the end of the first quarter, and will support the Company's strategic objectives and other general business needs.

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

What changed 10-Q

Item 1. Financial Statements