GIBRALTAR INDUSTRIES, INC. 10-K

Item 8. Financial Statements and Supplementary Data Page Number Financial Statements: Report of Independent Registered Public Accounting Firm (PCAOB ID: 42 ) 33 Consolidated Statements of Income for the Years Ended December 31, 202 4 , 202 3 , and 202 2 35 Consolidated Statements of Comprehensive Income for the Years Ended December 31, 202 4 , 202 3 , and 202 2 36 Consolidated Balance Sheets as of December 31, 202 4 and 202 3 37 Consolidated Statements of Cash Flows for the Years Ended December 31, 202 4 , 202 3 , and 202 2 38 Consolidated Statements of Stockholders’ Equity for the Years Ended December 31, 202 4 , 202 3 , and 202 2 39 Notes to Consolidated Financial Statements 40 Index for Notes to Consolidated Financial Statements: Note 1. Summary of Significant Accounting Policies 40 Note 2 . Revenue 45 Note 3 . Inventories, Net 46 Note 4 . Property, Plant, and Equipment, Net 47 Note 5 . Acquisition s and Divesti ture s 47 Note 6 . Goodwill and Related Intangible Assets 49 Note 7 . Accrued Expenses 50 Note 8 . Debt 51 Note 9 . Equity-Based Compensation 51 Note 1 0 . Fair Value Measurements 53 Note 1 1 . Exit Activity Costs and Asset Impairments 54 Note 1 2 . Income Taxes 55 Note 1 3 . Earnings per Share 58 Note 1 4 . Leases 58 Note 1 5 . Commitments and Contingencies 59 Note 1 6 . Segment Information 59 Note 1 7 . S ub seq uent Event 62 32 Table of Contents Report of Independent Registered Public Accounting Firm To the Stockholders and the Board of Directors of Gibraltar Industries, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Gibraltar Industries, Inc. (the Company) as of December 31, 2024 and 2023, the related consolidated statements of income, comprehensive income, stockholders' equity and cash flows for each of the three years in the period ended December 31, 2024, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024, in conformity with U.S. generally accepted accounting principles. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control–Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated February 19, 2025 expressed an unqualified opinion thereon. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. 33 Table of Contents Revenue Recognition on Contracts Description of the Matter During the year ended December 31, 2024, the amount of revenue recognized over time was $465 million. As discussed in Note 1 to the consolidated financial statements, for contracts with customers with respect to which the Company satisfies a performance obligation over time, the Company recognizes revenue based on the extent of progress towards completion of the performance obligation using the cost-to-cost measure of progress. Auditing management’s estimates to complete for certain components is especially subjective due to significant judgment required in estimating the remaining costs to complete. Factors inherent in the estimation process include direct labor hours, direct material costs, and other direct costs. Due to uncertainties attributed to such factors, a significant change in an estimate on one or more contracts could have a material effect on the Company’s results of operations. How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design and tested the operating effectiveness of controls that address the risks of material misstatement relating to the measurement and valuation of the Company’s review of estimated costs to complete, including the determination of the underlying significant assumptions and the completeness and accuracy of the contracts reviewed. For example, we tested controls over management’s quarterly review of the cost estimates, monthly review of open contracts and completed contracts, and review over the cost estimates used to develop initial cost estimates on projects. To test the amount of revenue recognized from contracts, our audit procedures included, among others, assessing whether the performance obligations identified were appropriately recognized on an over time basis through inspection of the contract and inquiry from management regarding the nature and scope of work and testing the completeness and accuracy of the data underlying the determination of the amount of revenue recognized in the current period. To assess the over time revenue recognition, we tested that the actual costs incurred on the project are complete and accurate through agreement to supporting evidence. Our testing of the assumptions included a combination of inquiries of the project management and financial personnel, inspection of evidence to support future estimated costs, performance of an analysis of actual gross margin on completed contracts compared to prior estimates, evaluation of subsequent year-end expenses incurred on projects, and assessment of the historical accuracy of management’s estimates by analyzing changes in project gross margins during project lifecycles and determining if those changes were driven by cost factors that should have been known or could have been reasonably estimated at project inception. /s/ Ernst & Young LLP We have served as the Company‘s auditor since 2005. Boston, Massachusetts February 19, 2025 34 Table of Contents GIBRALTAR INDUSTRIES, INC. CONSOLIDATED STATEMENTS OF INCOME (in thousands, except per share data) Years Ended December 31, 2024 2023 2022 Net sales $ 1,308,764 $ 1,377,736 $ 1,389,966 Cost of sales 956,936 1,015,770 1,071,272 Gross profit 351,828 361,966 318,694 Selling, general, and administrative expense 197,505 207,440 188,592 Intangible asset impairment 11,300 3,797 — Income from operations 143,023 150,729 130,102 Interest (income) expense, net ( 6,171 ) 3,002 4,047 Other (income) expense ( 24,731 ) ( 1,265 ) 14,565 Income before taxes 173,925 148,992 111,490 Provision for income taxes 36,585 38,459 29,084 Net income $ 137,340 $ 110,533 $ 82,406 Net earnings per share: Basic $ 4.50 $ 3.61 $ 2.57 Diluted $ 4.46 $ 3.59 $ 2.56 Weighted average shares outstanding: Basic 30,538 30,626 32,096 Diluted 30,769 30,785 32,192 See accompanying notes to consolidated financial statements. 35 Table of Contents GIBRALTAR INDUSTRIES, INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (in thousands) Years Ended December 31, 2024 2023 2022 Net income $ 137,340 $ 110,533 $ 82,406 Other comprehensive (loss) income: Foreign currency translation adjustment ( 3,337 ) 1,204 ( 5,022 ) Adjustment to postretirement benefit liability, net of tax 125 114 1,403 Other comprehensive (loss) income ( 3,212 ) 1,318 ( 3,619 ) Total comprehensive income $ 134,128 $ 111,851 $ 78,787 See accompanying notes to consolidated financial statements. 36 Table of Contents GIBRALTAR INDUSTRIES, INC. CONSOLIDATED BALANCE SHEETS (in thousands) December 31, 2024 December 31, 2023 Assets Current assets: Cash and cash equivalents $ 269,480 $ 99,426 Trade receivables, net of allowance of $ 3,394 and $ 5,351 , respectively 169,350 172,736 Costs in excess of billings, net 34,570 51,814 Inventories, net 138,140 120,503 Prepaid expenses and other current assets 39,792 17,772 Total current assets 651,332 462,251 Property, plant, and equipment, net 109,820 107,603 Operating lease assets 45,021 44,918 Goodwill 507,419 513,383 Acquired intangibles 103,882 125,980 Other assets 1,936 2,316 $ 1,419,410 $ 1,256,451 Liabilities and Stockholders’ Equity Current liabilities: Accounts payable $ 117,408 $ 92,124 Accrued expenses 95,664 88,719 Billings in excess of costs 41,790 44,735 Total current liabilities 254,862 225,578 Deferred income taxes 56,655 57,103 Non-current operating lease liabilities 35,125 35,989 Other non-current liabilities 24,734 22,783 Stockholders’ equity: Preferred stock, $ 0.01 par value; authorized 10,000 shares; none outstanding — — Common stock, $ 0.01 par value; authorized 100,000 shares; 34,313 and 34,219 shares issued and outstanding in 2024 and 2023 343 342 Additional paid-in capital 343,583 332,621 Retained earnings 875,851 738,511 Accumulated other comprehensive loss ( 5,326 ) ( 2,114 ) Cost of 3,960 and 3,778 common shares held in treasury in 2024 and 2023 ( 166,417 ) ( 154,362 ) Total stockholders’ equity 1,048,034 914,998 $ 1,419,410 $ 1,256,451 See accompanying notes to consolidated financial statements. 37 Table of Contents GIBRALTAR INDUSTRIES, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) Years Ended December 31, 2024 2023 2022 Cash Flows from Operating Activities Net income $ 137,340 $ 110,533 $ 82,406 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 27,312 27,378 26,167 Intangible asset impairment 11,300 3,797 — Stock compensation expense 10,963 9,750 8,334 Gain on sale of business ( 25,265 ) — — Exit activity costs, non-cash 31 2,771 16,266 (Benefit of) provision for deferred income taxes ( 486 ) 10,800 6,337 Other, net 5,865 12,492 1,506 Changes in operating assets and liabilities net of effects from acquisitions: Trade receivables and costs in excess of billings 17,914 ( 15,375 ) 32,754 Inventories ( 18,623 ) 45,908 14,377 Other current assets and other assets ( 22,515 ) 514 2,062 Accounts payable 26,528 ( 14,387 ) ( 76,260 ) Accrued expenses and other non-current liabilities 3,900 24,295 ( 11,258 ) Net cash provided by operating activities 174,264 218,476 102,691 Cash Flows from Investing Activities Purchases of property, plant, and equipment, net ( 19,930 ) ( 13,906 ) ( 20,062 ) Acquisitions, net of cash acquired — ( 9,863 ) ( 51,621 ) Net proceeds from sale of business 28,474 8,047 — Net cash provided by (used in) investing activities 8,544 ( 15,722 ) ( 71,683 ) Cash Flows from Financing Activities Long-term debt payments — ( 141,000 ) ( 138,000 ) Proceeds from long-term debt — 50,000 204,500 Payment of debt issuance costs — — ( 2,013 ) Purchase of common stock at market prices ( 12,189 ) ( 29,329 ) ( 89,494 ) Net cash used in financing activities ( 12,189 ) ( 120,329 ) ( 25,007 ) Effect of exchange rate changes on cash ( 565 ) ( 607 ) ( 1,242 ) Net increase in cash and cash equivalents 170,054 81,818 4,759 Cash and cash equivalents at beginning of year 99,426 17,608 12,849 Cash and cash equivalents at end of year $ 269,480 $ 99,426 $ 17,608 Supplemental disclosure of cash flow information Cash paid for interest $ 1,050 $ 3,553 $ 3,542 Cash paid for income taxes $ 31,044 $ 23,447 $ 27,017 See accompanying notes to consolidated financial statements. 38 Table of Contents GIBRALTAR INDUSTRIES, INC. CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (in thousands) Common Stock Additional Paid-In Capital Retained Earnings Accumulated Other Comprehensive (Loss) Income Treasury Stock Total Stockholders’ Equity Shares Amount Shares Amount Balance at December 31, 2021 33,799 $ 338 $ 314,541 $ 545,572 $ 187 1,107 $ ( 35,380 ) $ 825,258 Net income — — — 82,406 — — — 82,406 Foreign currency translation adjustment — — — — ( 5,022 ) — — ( 5,022 ) Postretirement benefit plan adjustments, net of taxes of $ 449 — — — — 1,403 — — 1,403 Stock compensation expense — — 8,334 — — — — 8,334 Net settlement of restricted stock units 245 2 ( 2 ) — — 95 ( 4,404 ) ( 4,404 ) Awards of common stock 16 — — — — — — — Common stock repurchased under stock repurchase program — — — — — 1,997 ( 85,876 ) ( 85,876 ) Balance at December 31, 2022 34,060 $ 340 $ 322,873 $ 627,978 $ ( 3,432 ) 3,199 $ ( 125,660 ) $ 822,099 Net income — — — 110,533 — — — 110,533 Foreign currency translation adjustment — — — — 1,204 — — 1,204 Postretirement benefit plan adjustments, net of taxes of $ 36 — — — — 114 — — 114 Stock compensation expense — — 9,750 — — — — 9,750 Net settlement of restricted stock units 151 2 ( 2 ) — — 58 ( 3,362 ) ( 3,362 ) Awards of common stock 8 — — — — — — — Excise tax on repurchase of common shares — — — — — — ( 159 ) ( 159 ) Common stock repurchased under stock repurchase program — — — — — 521 ( 25,181 ) ( 25,181 ) Balance at December 31, 2023 34,219 $ 342 $ 332,621 $ 738,511 $ ( 2,114 ) 3,778 $ ( 154,362 ) $ 914,998 Net income — — — 137,340 — — — 137,340 Foreign currency translation adjustment — — — — ( 3,337 ) — — ( 3,337 ) Postretirement benefit plan adjustments, net of taxes of $ 41 — — — — 125 — — 125 Stock compensation expense — — 10,963 — — — — 10,963 Net settlement of restricted stock units 86 1 ( 1 ) — — 27 ( 2,035 ) ( 2,035 ) Awards of common stock 8 — — — — — — — Excise tax on repurchase of common shares — — — — — — ( 34 ) ( 34 ) Common stock repurchased under stock repurchase program — — — — — 155 ( 9,986 ) ( 9,986 ) Balance at December 31, 2024 34,313 $ 343 $ 343,583 $ 875,851 $ ( 5,326 ) 3,960 $ ( 166,417 ) $ 1,048,034 See accompanying notes to consolidated financial statements. 39 Table of Contents GIBRALTAR INDUSTRIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of consolidation The consolidated financial statements include the accounts of Gibraltar Industries, Inc. and subsidiaries (the "Company"). All intercompany accounts and transactions have been eliminated in consolidation. Reclassification The Company has presented costs in excess of billings, net separately on its consolidated balance sheet as of December 31, 2023 to conform with current year presentation. Historically, the Company included costs in excess of billings, net within accounts receivable on its consolidated balance sheet. This reclassification had no impact on the Company's net income, earnings per share, cash flows, segment reporting or financial position. Use of estimates The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates due to uncertainty in the current economic environment. Segment reporting The Company has four reportable segments: Residential, Renewables, Agtech and Infrastructure. For further disclosure regarding the Company's reportable segments, refer to Note 16 "Segment Information." Revenue recognition Revenue is recognized when, or as, the Company transfers control of promised products or services to a customer in an amount that reflects the consideration the Company expects to be entitled in exchange for transferring those products or services. Performance obligations satisfied at a point in time and significant judgments Revenue from contracts with customers is recognized when the Company transfers control of the promised product at a point in time, which is determined when the customer has legal title and the significant risks and rewards of ownership of the asset, and the Company has a present right to payment for the product. The Company allocates the transaction price, which is generally the quoted price per terms of the contract and the consideration the Company expects to receive, to each performance obligation. These products are generally sold with rights of return and these contracts may provide other credits or incentives, which are accounted for as variable consideration. Sales returns, allowances, and customer incentives, including rebates, are treated as reductions to the sales transaction price and based largely on an assessment of all information (i.e., historical, current and forecasted) that is reasonably available to the Company, and estimated at contract inception and updated at the end of each reporting period as additional information becomes available. Performance obligations satisfied over time and significant judgments For a contract to construct an asset that the customer controls as it is being created or enhanced, or a promise to provide a product that has no alternative use to the Company and the Company has enforceable rights to payment, the Company recognizes revenue over time. For the contracts to construct a certain asset, the Company determines that the customer controls the asset while it is being constructed. For the contracts for products that have no alternative use and for which the Company has an enforceable right to payment, the Company identifies these products as products that are not a standard inventory item or the Company cannot readily direct the product to another customer for use without incurring a significant economic loss, or significant costs to rework the product. The Company determines the transaction price for each contract based on the consideration the Company expects to receive for the promised products and services under the entire contract, which is generally the stated contract price based on an expected cost plus a margin. For the above contracts with customers with respect to which the Company satisfies a performance obligation over time, the Company recognizes revenue based on the extent of progress towards completion of the performance obligation using the cost-to-cost measure of progress. Under the cost-to-cost measure of progress, the extent of 40 Table of Contents progress toward completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation. Revenues are recognized proportionally as costs are incurred. Costs to fulfill a contract include all direct costs related to contract performance. On a regular basis for substantially all contracts, the Company reviews its estimates and progress towards completion of its performance obligations. When the Company determines there is a change to any individual contract's estimated total costs to be incurred, the Company recognizes the impact to revenues using the cumulative catch-up method. When any individual contract's estimated total costs to be incurred exceeds the contract's transaction price, the Company recognizes the contract loss in the period in which such loss is determined. The Company also recognizes revenues from services contracts over time. The Company recognizes revenue over time during the term of the agreement as the customer is simultaneously receiving and consuming the benefits provided throughout the Company's performance. Therefore, due to control transferring over time, the Company recognizes revenue on a straight-line basis throughout the contract period. Contract assets and contract liabilities Contract assets primarily represents revenue recognized for performance obligations that have been satisfied but for which amounts receivable have not been billed. Contract liabilities include payments received from customers in advance of the satisfaction of performance obligations for a contract. The Company does not consider contract advances to be significant financing components as the intent of these payments in advance are for reasons other than providing a significant financing benefit and are customary in the Company's industry. Unearned revenue relates to payments received in advance of performance under the contract and is recognized when the Company performs under the contract. Costs to obtain a contract with a customer The Company expenses incremental costs of obtaining a contract as incurred when the benefit of those costs is less than twelve months. These incremental costs include, but are not limited to, sales commissions incurred to obtain a contract with a customer. If the Company expects the benefit of the incremental costs to be greater than twelve months, the Company records an asset for those costs which is amortized over the duration of the contract. Cash and cash equivalents All highly liquid investments with a maturity of three months or less are considered cash equivalents. Trade receivables and allowance for expected credit losses Trade receivables are stated at the amount invoiced to customers less an allowance for expected credit losses. In general, the Company's policy is to not charge interest on trade receivables after the invoice becomes past due. A trade receivable is considered past due if payment has not been received within the agreed upon invoice terms. The Company’s expected credit losses methodology is developed using estimates and historical collection experience, current and future economic and market conditions, and a review of the current status of customers' trade receivables. The Company is exposed to credit losses through sales of products and services. Due to the short-term nature of such trade receivables, the estimated amount of trade receivables that may not be collected is based on aging of the trade receivable balances. Additionally, specific allowance amounts are established to record the appropriate provision for customers that no longer share risk characteristics similar with other trade receivables. The Company’s monitoring activities include timely account reconciliation, dispute resolution, payment confirmation, consideration of customers' financial condition and macroeconomic conditions. Trade receivables are written off when determined to be u ncollectible after all means of collection have been exhausted and the potential for recovery is considered remote. The following table provides a roll-forward of the allowance for expected credit losses for the years ended December 31 (in thousands): 2024 2023 2022 Beginning balance $ 5,351 $ 3,527 $ 3,409 Bad debt expense, net of recoveries 1,093 3,146 1,331 Accounts written off against allowance and other adjustments ( 3,050 ) ( 1,322 ) ( 1,213 ) Ending balance $ 3,394 $ 5,351 $ 3,527 41 Table of Contents Concentrations of credit risk in trade receivable are limited to those from significant customers that are believed to be financially sound. As of December 31, 2024 and 2023, the Company's most significant customer is a home improvement retailer. The home improvement retailer purchases from the Residential segment. Trade receivables as a percentage of consolidated trade receivables from the home improvement retailer was 16 % and 17 % as of December 31, 2024 and 2023, respectively. Net sales to the home improvement retailer as a percentage of consolidated net sales were 12 %, 13 %, and 14 % during the years ended December 31, 2024, 2023 and 2022, respectively. Inventories Inventories are valued at the lower of cost or net realizable value. Cost is determined using either the first-in, first-out method or the average costing method. Shipping and handling costs are recognized as a component of cost of sales. Property, plant, and equipment Property, plant, and equipment are stated at cost and depreciated over their estimated useful lives using the straight-line method. Interest is capitalized in connection with construction of qualified assets. Expenditures that exceed an established dollar threshold and that extend the useful lives of assets are capitalized, while repair and maintenance costs are expensed as incurred. The estimated useful lives of land improvements, buildings, and building improvements are 15 to 40 years, while the estimated useful lives for machinery and equipment are 3 to 20 years. The table below sets forth the depreciation expense recognized during the years ended December 31 (in thousands): 2024 2023 2022 Depreciation expense $ 16,656 $ 16,139 $ 14,583 Acquisition related assets and liabilities Accounting for the acquisition of a business as a purchase transaction requires an allocation of the purchase price to the assets acquired and the liabilities assumed in the transaction at their respective estimated fair values. The most complex estimations of individual fair values are those involving long-lived assets, such as property, plant, and equipment and intangible assets. The Company uses all available information to make these fair value determinations and engages independent valuation specialists to assist in the fair value determination of the acquired long-lived assets. Goodwill and other intangible assets The Company tests goodwill for impairment at the reporting unit level on an annual basis at October 31, or more frequently if an event occurs, or circumstances change, that indicate that the fair value of a reporting unit could be below its carrying value. The reporting units are at the component level, or one level below the operating segment level. Goodwill is assigned to each reporting unit as of the date the reporting unit is acquired. The Company may elect to perform a qualitative assessment that considers economic, industry and company-specific factors for some or all of the Company's selected reporting units. If, after completing the assessment, it is determined that it is more likely than not that the fair value of a reporting unit is less than its carrying value, the Company proceeds to a quantitative test. The Company may also elect to perform a quantitative test instead of a qualitative test for any or all of the Company's reporting units. The quantitative impairment test consists of comparing the fair value of a reporting unit, determined using two valuation techniques, to its carrying value. If the carrying value of the reporting unit exceeds its fair value, goodwill is considered impaired, and a loss measured by the excess of the carrying value of the reporting unit over the fair value of the reporting unit must be recorded. The fair value of reporting units evaluated under the quantitative test are determined using two valuation techniques: an income approach and a market approach. Each valuation approach relies on significant assumptions including a weighted average cost of capital ("WACC") based upon the capital structure of market participants in the Company’s peer groups, projected revenue growth, forecasted cash flows, and earnings multiples based on the market value of the Company and market participants within its peer groups. The Company also tests its indefinite-lived intangible assets for impairment on an annual basis as of October 31, or more frequently if an event occurs, or circumstances change, that indicate that the fair value of an indefinite-lived intangible asset could be below its carrying value. The impairment test consists of comparing the fair value of the indefinite-lived intangible asset, determined using discounted cash flows on a relief-from-royalty basis, with its 42 Table of Contents carrying amount. An impairment loss would be recognized for the carrying amount in excess of its fair value. Acquired identifiable intangible assets are recorded at cost. Identifiable intangible assets with finite useful lives are amortized over their estimated useful lives. For additional disclosure of the Company's goodwill and other intangible assets refer to Note 6 "Goodwill and Related Intangible Assets." Impairment of long-lived assets Long-lived assets, including acquired identifiable intangible assets with finite useful lives, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of those assets may not be recoverable. In specific situations, when the Company has selected individual assets to be sold or scrapped, the Company obtains market value data for those specific assets and measures and records the impairment loss based on such data. Otherwise, the Company uses undiscounted cash flows to determine whether impairment exists and measures any impairment loss by approximating fair value using acceptable valuation techniques, including discounted cash flow models and third-party appraisals. For additional disclosure on impairment of the Company's long-lived assets refer to Note 6 "Goodwill and Related Intangible Assets" and Note 11 "Exit Activity Costs and Asset Impairments." Leases The Company determines if an agreement is, or contains, a lease at the inception of the agreement. At lease commencement, the Company recognizes a right-of-use asset and a lease liability for leases with terms greater than twelve months. The initial lease liability is recognized at the present value of remaining lease payments over the lease term. Leases with an initial term of twelve months or less are not recorded on the Company's consolidated balance sheets. The Company recognizes lease expense for operating leases on a straight-line basis over the lease term. The Company combines lease and non-lease components, such as common area maintenance costs, in calculating the related asset and lease liabilities for all underlying asset groups. Operating lease cost is included in income from operations and includes short-term leases and variable lease costs which are immaterial. Current operating lease liabilities are represented within accrued expenses on the Company's consolidated balance sheets. Deferred charges Deferred charges associated with initial costs incurred to enter into new debt arrangements are included as a component of long-term debt and are amortized as a part of interest expense over the terms of the associated debt agreements. Advertising The Company expenses advertising and marketing costs as incurred. For the years ended December 31, 2024, 2023 and 2022, advertising and marketing costs were $ 10.1 million, $ 10.0 million, and $ 10.9 million, respectively. Foreign currency transactions and translation The assets and liabilities of the Company’s foreign subsidiaries are translated into U.S. dollars at the rate of exchange in effect at the balance sheet date. Income and expense items are translated at the average exchange rates prevailing during the period. Defined Benefit Pension and Other Postretirement Plans The Company has a 401(k) plan in which all employees of U.S. subsidiaries are eligible to participate. Total expense for the 401(k) plan for the years ended December 31 was (in thousands): 2024 2023 2022 401(k) plan $ 4,360 $ 3,804 $ 3,580 The Company contributes to a multiemployer defined benefit pension plan under the terms of a collective-bargaining agreement that covers union-represented employees. The Company's one multiemployer plan is underfunded and has a rehabilitation plan in place. The rehabilitation plan requires minimum contributions from the Company. Given the status of this plan, it is reasonably possible that future contributions to the plan will increase although the Company cannot reasonably estimate a possible range of increased contributions as of December 31, 2024. The Company has an unfunded postretirement healthcare plan which provides health insurance to certain retired employees and their spouses. This plan has been frozen, no current employees participate and no additional participants will be added to the plan in the future. The Company's postretirement health care costs adjustments 43 Table of Contents are reclassified when realized from accumulated other comprehensive loss to other expense in the Company's consolidated statements of income. Income taxes The provision for income taxes is determined using the asset and liability approach. Under this approach, deferred income taxes represent the expected future tax consequences of temporary differences between the carrying amounts and tax basis of assets and liabilities. The Company records a valuation allowance to reduce deferred tax assets when uncertainty exists regarding their realization. Equity-based compensation The Company measures the cost of equity-based compensation based on grant date fair value and recognizes the cost over the period in which the employee is required to provide service in exchange for the award reduced by forfeitures. Equity-based compensation consists of grants of stock options, deferred stock units, common stock, restricted stock units, and performance stock units. Equity-based compensation expense is included as a component of selling, general, and administrative expenses. Earnings per share Basic earnings per share is calculated by dividing net income by the weighted average number of common shares outstanding during the period. Diluted earnings per share is calculated by adjusting the weighted average number of common shares outstanding, as well as dilutive common shares which include shares issuable pursuant to equity based incentive compensation awards under the equity compensation plans described in Note 9 "Equity-Based Compensation." Recent accounting pronouncements The Company evaluated all recently issued Financial Accounting Standards Board ("FASB") Accounting Standard Updates ("ASU"), including those that are currently effective in or after 2024, and determined that the adoption of these pronouncements would not have a material effect on the financial position, results of operations or cash flows of the Company, with the exception of the following adopted and not yet adopted recent accounting principles. Standard Description Financial Statement Effect or Other Significant Matters Recent Accounting Pronouncements Adopted ASU No. 2023-07 Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures In November 2023, the FASB issued ASU No. 2023-07, which requires a public entity to disclose significant segment expenses and other segment items on an annual and interim basis and provide in interim periods all disclosures about a reportable segment’s profit or loss and assets that are currently required annually. Additionally, it requires a public entity to disclose the title and position of the Chief Operating Decision Maker ("CODM"). The ASU does not change how a public entity identifies its operating segments, aggregates them, or applies the quantitative thresholds to determine its reportable segments. The amendments in the ASU are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. The Company adopted this ASU and the required disclosures in these financial statements and has applied the amendments in this ASU retrospectively to all prior periods presented in these financial statements. The adoption of this ASU only affected the Company's disclosures in Note 16 "Segment Information" and there was no material impact to the Company's results of operations, cash flows or financial condition. 44 Table of Contents Recent Accounting Pronouncements Not Yet Adopted ASU No. 2023-09 Income Taxes (Topic 740): Improvements to Income Tax Disclosures In December 2023, the FASB issued ASU No. 2023-09, which focuses on the rate reconciliation and income taxes paid. This ASU requires a public business entity to disclose, on an annual basis, a tabular rate reconciliation using both percentages and currency amounts, broken out into specified categories with certain reconciling items further broken out by nature and jurisdiction to the extent those items exceed a specified threshold. In addition, all entities are required to disclose income taxes paid, net of refunds received disaggregated by federal, state/local, and foreign and by jurisdiction if the amount is at least 5% of total income tax payments, net of refunds received. The amendments in this ASU are effective for the Company in its annual reporting period beginning after December 15, 2024, with early adoption permitted. The Company may apply the amendments in this ASU prospectively by providing the revised disclosures for the period ending December 31, 2025 and continuing to provide the pre-ASU disclosures for the prior periods, or may apply the amendments retrospectively by providing the revised disclosures for all period presented. The Company expects this ASU to impact the Company's disclosures with no material impacts to the Company's results of operations, cash flows, and financial condition. The Company's planned date of adoption of these required disclosures in its financial statements for annual reporting period ending December 31, 2025. ASU No. 2024-03 Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses and ASU No. 2025-01 Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date In November 2024, the FASB issued ASU No. 2024-03, which includes amendments that require disaggregated information about certain income statement expense line items to be disclosed in the notes to the financial statements on an annual and interim basis. Additionally, in January 2025, the FASB issued ASU No. 2025-01, which amended the effective date of ASU 2024-03. The amendments in ASU 2024-03 are effective for the Company in its first annual reporting period beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is required to apply the amendments in this ASU prospectively and may apply it retrospectively. The Company expects this ASU to impact the Company's disclosures with no material impacts to the Company's results of operations, cash flows, and financial condition. The Company's planned date of adoption of these required disclosures in its financial statements for annual reporting period ending December 31, 2027. (2) REVENUE Sales includes revenue from contracts with customers for roof and foundation ventilation products, centralized mail systems, rain dispersion products, trims and flashings and other accessories, retractable awnings and gutter guards; designing, engineering, manufacturing and installation of solar racking systems and electrical balance of systems; designing, engineering, manufacturing and installation of greenhouses; structural bearings, expansion joints, pavement sealant, elastomeric concrete and bridge cable protection systems. Refer to Note 16 "Segment Information" for disclosures related to disaggregation of revenue. Payment terms and conditions vary by contract, although terms generally include a requirement of payment within a range from 30 to 60 days, or in certain cases, up front deposits. In circumstances where the timing of revenue recognition differs from the timing of invoicing, the Company has determined that the Company's contracts generally 45 Table of Contents do not include a significant financing component. Taxes collected from customers, which are subsequently remitted to governmental authorities, are excluded from sales. As of December 31, 2024, the Company's remaining performance obligations are part of contracts that have an original expected duration of one year or less. Additionally, as of December 31, 2024 and 2023, there were no assets recognized related to incremental costs of obtaining a contract with a customer as the benefits of these costs are not expected to exceed one year . Contract assets consist of net costs in excess of billings, classified as current assets in the Company's consolidated balance sheets. Contract liabilities consist of billings in excess of costs, classified as current liabilities, and unearned revenue, presented within accrued expenses, in the Company's consolidated balance sheets. Unearned revenue at December 31, 2024 and 2023 was $ 3.1 million and $ 3.9 million, respectively. The Company recognized revenue of $ 42.9 million, $ 35.5 million, and $ 44.4 million during the years ended December 31, 2024, 2023, and 2022, respectively, that was included in the contract liabilities balance of $ 48.7 million, $ 39.6 million, and $ 50.4 million at December 31, 2023, 2022 and 2021, respectively. The decreases in costs in excess of billings and billings in excess of costs as of December 31, 2024 compared to December 31, 2023, respectively, were primarily due to decline in volume in the Renewables segment in 2024 compared to 2023. For the years ended December 31, 2024, 2023, and 2022, there were no changes to estimated total costs to be incurred related to any individual contract that materially impacted the Company's consolidated financial statements. (3) INVENTORIES, NET Inventories, net of reserves, consisted of the following at December 31 (in thousands): 2024 2023 Raw material $ 78,888 $ 71,981 Work-in-process 18,195 9,508 Finished goods 41,057 39,014 Inventories, net $ 138,140 $ 120,503 The Company's gross inventory balances are reduced by reserves for excess, obsolete and slow moving inventory and estimates for determining net realizable value of the inventory that are reported on a net basis on the Company's consolidated balance sheets. The following table summarizes activity recorded within the reserve for excess, obsolete and slow moving inventory for the years ended December 31 (in thousands): 2024 2023 2022 Beginning balance $ 9,378 $ 6,179 $ 4,400 Excess, obsolete and slow moving inventory expense 692 4,243 1,582 Scrapped inventory and other adjustments ( 4,746 ) ( 1,044 ) 197 Ending balance $ 5,324 $ 9,378 $ 6,179 46 Table of Contents (4) PROPERTY, PLANT, AND EQUIPMENT, NET Components of property, plant, and equipment at December 31 consisted of the following (in thousands): 2024 2023 Land and land improvements $ 4,474 $ 4,544 Building and improvements 44,320 43,732 Machinery and equipment 248,741 231,275 Construction in progress 16,378 17,391 Property, plant, and equipment, gross 313,913 296,942 Less: accumulated depreciation ( 204,093 ) ( 189,339 ) Property, plant, and equipment, net $ 109,820 $ 107,603 (5) ACQUISITIONS AND DIVESTITURES 2023 Acquisition On July 5, 2023, the Company acquired the assets of a privately held Utah-based company that manufactures and distributes roof flashing and accessory products, and sells direct to roofing wholesalers. The results of this acquisition have been included in the Company's consolidated financial results since the date of acquisition within the Company's Residential segment. The purchase consideration for this acquisition was $ 10.4 million, which includes a working capital adjustment and certain other adjustments provided for in the asset purchase agreement. The purchase price for the acquisition was allocated to the assets acquired and liabilities assumed based upon their respective fair values estimated as of the date of acquisition. The Company has completed the process to confirm the existence, condition, and completeness of the assets acquired and liabilities assumed to establish fair value of such assets and liabilities and to determine the amount of goodwill to be recognized as of the date of acquisition. The excess consideration was recorded as goodwill and approximated $ 3.0 million, all of which is deductible for tax purposes. Goodwill represents future economic benefits arising from other assets acquired that could not be individually identified including workforce additions, growth opportunities, and increased presence in the domestic building products markets. The allocation of the purchase consideration to the estimated fair value of the assets acquired and liabilities assumed is as follows as of the date of the acquisition (in thousands): Working capital $ 827 Property, plant, and equipment 195 Acquired intangible assets 6,310 Other assets 134 Other liabilities ( 72 ) Goodwill 3,023 Fair value of purchase consideration $ 10,417 The intangible assets acquired in this acquisition consisted of the following (in thousands): Fair Value Weighted-Average Amortization Period Trademarks $ 250 3 years Customer relationships 6,060 12 years Total $ 6,310 2022 Acquisition On August 22, 2022, the Company purchased all the issued and outstanding membership interests of Quality Aluminum Products ("QAP"), a manufacturer of aluminum and steel products including soffit, fascia, trim coil, rain carrying products and aluminum siding. The results of QAP have been included in the Company's consolidated financial results since the date of acquisition within the Company's Residential segment. The purchase 47 Table of Contents consideration for the acquisition of QAP was $ 52.1 million, which includes a working capital adjustment and certain other adjustments provided for in the membership interest purchase agreement. The purchase price for the acquisition was allocated to the assets acquired and liabilities assumed based upon their respective fair values estimated as of the date of acquisition. The Company has completed the process to confirm the existence, condition, and completeness of the assets acquired and liabilities assumed to establish fair value of such assets and liabilities and to determine the amount of goodwill to be recognized as of the date of acquisition. The excess consideration was recorded as goodwill and approximated $ 4.0 million, all of which is deductible for tax purposes. Goodwill represents future economic benefits arising from other assets acquired that could not be individually identified including workforce additions, growth opportunities, and increased presence in the domestic building products markets. The allocation of the purchase consideration to the estimated fair value of the assets acquired and liabilities assumed is as follows as of the date of the acquisition (in thousands): Cash $ 1,018 Working capital 23,372 Property, plant, and equipment 8,486 Acquired intangible assets 14,700 Other assets 1,813 Other liabilities ( 1,295 ) Goodwill 3,991 Fair value of purchase consideration $ 52,085 The intangible assets acquired in this acquisition consisted of the following as of the date of acquisition (in thousands): Fair Value Weighted-Average Amortization Period Trademarks $ 2,800 Indefinite Customer relationships 11,900 12 years Total $ 14,700 The acquisition of the privately held Utah-based company and the acquisition of QAP were financed primarily through borrowings under the Company's revolving credit facility. The Company recognized costs as a component of cost of sales related to the sale of inventory at fair value as a result of allocating the purchase price of recent acquisitions. The Company also incurred certain acquisition-related costs comprised of legal and consulting fees. These costs were recognized as a component of selling, general, and administrative expenses in the consolidated statements of income. The acquisition-related costs consisted of the following for the years ended December 31 (in thousands): 2024 2023 2022 Cost of sales $ — $ 12 $ 1,427 Selling, general and administrative costs 491 253 545 Total acquisition related costs $ 491 $ 265 $ 1,972 2024 Divestiture On December 17, 2024, the Company sold its electronic locker business within its Residential segment to a third party. The $ 28.1 million net proceeds from the sale resulted in a pre-tax net gain of $ 25.3 million and has been presented within other (income) expense in the consolidated statements of income. This divestiture did not meet the criteria to be recorded as a discontinued operation nor did it have a major effect on the Company's operations. 48 Table of Contents 2023 Divestiture On December 1, 2023, the Company sold its Japan-based solar racking business within its Renewables segment to a third party. The $ 8.0 million net proceeds from the sale resulted in a pre-tax net loss of $ 0.6 million and has been presented within other (income) expense in the consolidated statements of income. This divestiture did not meet the criteria to be recorded as a discontinued operation nor did it have a major effect on the Company's operations. (6) GOODWILL AND RELATED INTANGIBLE ASSETS Goodwill The changes in the carrying amount of goodwill for the years ended December 31 were as follows (in thousands): Residential Renewables Agtech Infrastructure Total Balance at December 31, 2022 $ 209,056 $ 188,030 $ 83,599 $ 31,678 $ 512,363 Acquired goodwill 4,133 — — — 4,133 Other changes (1) 387 ( 3,800 ) 300 — ( 3,113 ) Balance at December 31, 2023 213,576 184,230 83,899 31,678 513,383 Other changes (1) ( 4,406 ) — ( 1,558 ) — ( 5,964 ) Balance at December 31, 2024 $ 209,170 $ 184,230 $ 82,341 $ 31,678 $ 507,419 (1) Other changes in the carrying amounts of goodwill includes adjustment to prior year acquisitions, foreign currency translation and sale of business. Goodwill is recognized net of accumulated impairment losses of $ 133.2 million as of December 31, 2024 and 2023, respectively. No goodwill impairment charges were recognized during the years ended December 31, 2024, 2023, and 2022. Annual and Interim Impairment Testing The Company tests goodwill and indefinite-lived intangible assets for impairment on an annual basis as of October 31 and at interim dates when indicators of impairment are present. In 2024, 2023, and 2022, no indicators of impairment were identified as of interim dates; therefore, no interim tests were performed. The Company conducted its annual goodwill impairment test for its six reporting units as of October 31, 2024. A quantitative test was conducted for one of reporting units, and a qualitative analysis for the remaining five reporting units. Both the quantitative and qualitative impairment tests consist of comparing the fair value of a reporting unit with its carrying value including goodwill. For additional disclosure of the Company's assessment approach, refer to Note 1 "Summary of Significant Accounting Policies". As a result of the Company's annual testing for 2024, 2023, and 2022, none of the reporting units with goodwill as of the testing date had carrying values in excess of their fair values. Acquired Intangible Assets Acquired intangible assets consisted of the following (in thousands): December 31, 2024 December 31, 2023 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Indefinite-lived intangible assets: Trademarks $ 40,400 $ — $ 52,300 $ — Finite-lived intangible assets: Trademarks 2,550 1,773 5,773 4,714 Unpatented technology 30,329 23,199 34,133 24,295 Customer relationships 99,060 43,560 110,649 48,088 Non-compete agreements 709 634 2,376 2,154 132,648 69,166 152,931 79,251 Total acquired intangible assets $ 173,048 $ 69,166 $ 205,231 $ 79,251 49 Table of Contents The following table summarizes intangible asset impairment for the years ended December 31 (in thousands): 2024 2023 2022 Indefinite-lived trademarks (1) $ 11,300 $ 3,200 $ — Amortizing trademarks (2) — 597 — Total $ 11,300 $ 3,797 $ — (1) Rebranding initiatives that resulted in the discontinuation of certain indefinite-lived trademarks in both the Renewables and Agtech segments in 2024 and only the Agtech segment in 2023. (2) Write-off of amortizing intangibles related to a discontinued product line in the Renewables segment. The Company recognized amortization expense related to the definite-lived intangible assets. The following table summarizes amortization expense for the years ended December 31 (in thousands): 2024 2023 2022 Amortization expense $ 10,656 $ 11,239 $ 11,584 Amortization expense related to acquired intangible assets for the next five years ended December 31 is estimated as follows (in thousands): 2025 2026 2027 2028 2029 Amortization expense $ 10,351 $ 9,318 $ 8,033 $ 7,270 $ 7,221 (7) ACCRUED EXPENSES Accrued expenses at December 31 consisted of the following (in thousands): 2024 2023 Compensation $ 20,193 $ 22,893 Customer rebates 18,066 18,497 Product warranties 17,463 9,139 Current operating lease liability 11,473 10,278 Insurance 5,773 6,307 Interest and taxes 5,571 5,167 Other 17,125 16,438 Total accrued expenses $ 95,664 $ 88,719 Accrued expenses for compensation includes salaries, benefits, and short-term or current portions of incentives and bonuses. Accrued expenses for insurance are primarily for general liability, workers’ compensation and employee healthcare policies for which the Company is self-insured up to certain per-occurrence and aggregate limits. Product Warranties The Company generally warrants that its products will be free from material defects in workmanship and materials. Warranty reserve estimates are based on management’s judgment, considering such factors as historical experience, anticipated rates of claims, and other available information. Management reviews and adjusts these estimates, if necessary, based on the differences between actual experience and historical estimates. The reserve for product warranties is presented within accrued expenses on the Company’s consolidated balance sheets. Activity in the product warranties is summarized as follows for the years ended December 31, (in thousands): 2024 2023 Beginning balance $ 9,139 $ 6,251 Provisions/accruals during the period 16,048 6,190 Settlements made during the period ( 7,724 ) ( 3,302 ) Ending balance $ 17,463 $ 9,139 50 Table of Contents (8) DEBT The Company had no outstanding debt as of December 31, 2024 and 2023. Unamortized debt issuance costs, included in other assets on the consolidated balance sheets, as of December 31, 2024 and 2023 were $ 1.3 million and $ 1.7 million, respectively. Revolving Credit Facility On December 8, 2022, the Company entered into a Credit Agreement (the "Credit Agreement") which provides for a revolving credit facility and letters of credit in an aggregate amount equal to $ 400 million. The Company can request additional financing to increase the revolving credit facility to $ 700 million or enter into a term loan of up to $ 300 million subject to conditions set forth in the Credit Agreement. The Credit Agreement contains two financial covenants. As of December 31, 2024, the Company was in compliance with all financial covenants. The Credit Agreement terminates on December 8, 2027. Borrowings under the Credit Agreement bear interest, at the Company’s option, at a rate equal to the applicable margin plus (a) a base rate, (b) a daily simple secured overnight financing rate ("SOFR") rate, (c) a term SOFR rate or (d) for certain foreign currencies, a foreign currency rate, in each case subject to a 0% floor. Through March 31, 2023, the Credit Agreement had an initial applicable margin of 0.125 % for base rate loans and 1.125 % for SOFR and alternative currency loans. Thereafter, the applicable margin ranges from 0.125 % to 1.00 % for base rate loans and from 1.125 % to 2.00 % for SOFR and alternative currency loans based on the Company’s Total Net Leverage Ratio, as defined in the Credit Agreement. In addition, the Credit Agreement is subject to an annual commitment fee, payable quarterly, which was initially 0.20 % of the daily average undrawn balance of the revolving credit facility and, from and after April 1, 2023, ranges between 0.20 % and 0.25 % of the daily average undrawn balance of the revolving credit facility based on the Company’s Total Net Leverage Ratio. Borrowings under the Credit Agreement are secured by the trade receivables, inventory, personal property, equipment, and general intangibles of the Company’s significant domestic subsidiaries. Capital distributions are subject to certain Total Net Leverage Ratio requirements and capped by an annual aggregate limit under the Credit Agreement. The Company's Sixth Amended and Restated Credit Agreement (the "Prior Credit Agreement") dated as of January 24, 2019 provided a revolving credit facility and letters of credit in an aggregate amount equal to $ 400 million. Interest rates on the revolving credit facility under the Prior Credit Agreement were based on LIBOR plus an additional margin that ranges from 1.125 % to 2.00 %. In addition, the revolving credit facility under the Prior Credit Agreement was subject to an undrawn commitment fee ranging between 0.15 % and 0.25 % based on the Total Leverage Ratio and the daily average undrawn balance. The Prior Credit Agreement terminated on December 8, 2022. Standby letters of credit of $ 4.9 million have been issued under the Credit Agreement to third parties on behalf of the Company as of December 31, 2024. These letters of credit reduce the amount otherwise available under the Credit Agreement's revolving credit facility. The Company had $ 395.1 million and $ 396.1 million of availability under the revolving credit facility as of December 31, 2024 and 2023, respectively. (9) EQUITY-BASED COMPENSATION The Company awards equity-based compensation to employees and non-employee directors, which is recognized in the consolidated statements of income based on the grant-date fair value of the award. The Company uses the straight-line method for recording compensation expense over a vesting period generally up to four years with either graded or cliff vesting. Stock compensation expense recognized during the period is based on the value of the portion of equity-based awards that is ultimately expected to vest during the period reduced by the expense on unvested awards forfeited during the period. The Gibraltar Industries, Inc. Amended and Restated 2018 Equity Incentive Plan (the "Amended 2018 Plan") which includes a total of 1,631,707 shares available for issuance, allows the Company to grant equity-based incentive compensation awards, in the form of non-qualified options, restricted shares, restricted stock units, performance shares, performance stock units, and stock rights to eligible participants. 51 Table of Contents The Gibraltar Industries, Inc. Amended and Restated 2016 Stock Plan for Non-Employee Directors ("Non-Employee Directors Plan") which includes 200,000 shares available for issuance, allows the Company to grant awards of shares of the Company's common stock to current non-employee Directors of the Company, and permits the Directors to defer receipt of such shares pursuant to the terms of the Non-Employee Directors Plan. At December 31, 2024, approximately 684,000 shares were available for issuance under the Amended 2018 Plan as incentive stock options or other stock awards, and approximately 75,000 shares were available for issuance under the Non-Employee Directors Plan as awards of shares of the Company's common stock. The compensation cost for employee and non-employee director equity-based compensation plans for all current and prior year awards granted along with the related tax benefits recognized during the years ended December 31 were as follows (in thousands): 2024 2023 2022 Total stock compensation expense $ 10,963 $ 9,750 $ 8,334 Tax benefits recognized related to stock compensation expense $ 2,302 $ 2,516 $ 2,175 Equity Based Awards - Settled in Stock The following table provides the number of stock units and common stock granted during the years ended December 31, along with the weighted-average grant-date fair value of each award: 2024 2023 2022 Awards Number of Awards Weighted Average Grant Date Fair Value Number of Awards Weighted Average Grant Date Fair Value Number of Awards Weighted Average Grant Date Fair Value Deferred stock units 3,340 $ 68.86 6,351 $ 54.33 2,460 $ 42.69 Common stock 7,564 $ 68.64 8,468 $ 54.33 15,652 $ 42.49 Restricted stock units 82,930 $ 71.77 99,820 $ 61.93 132,430 $ 43.92 Performance stock units (1) 60,765 $ 77.28 85,323 $ 53.22 108,464 $ 47.00 (1) The Company’s performance stock units (“PSUs”) represent shares granted for which the final number of shares earned depends on financial performance. The number of shares to be issued may vary between 0 % and 200 % of the number of PSUs granted depending on the relative achievement to targeted thresholds. The Company's PSUs with a financial performance condition are based on the Company’s return on invested capital (“ROIC”) over a one-year period performance period. Stock Units and Common Stock The following table summarizes information about non-vested restricted stock units and performance stock units (that will convert to shares upon vesting), deferred stock units and common stock: Restricted Stock Units Weighted Average Grant Date Fair Value Common Stock Weighted Average Grant Date Fair Value Performance Stock Units Weighted Average Grant Date Fair Value Deferred Stock Units (2) Weighted Average Grant Date Fair Value Balance at December 31, 2023 232,970 $ 53.75 — $ — 136,246 $ 52.27 44,479 $ 46.90 Granted 82,930 $ 71.77 7,564 $ 68.64 60,765 $ 77.28 3,340 $ 68.86 Adjustments (1) — $ — — $ — 76,734 $ 53.04 — $ — Vested ( 63,451 ) $ 60.34 ( 7,564 ) $ 68.64 ( 10,148 ) $ 68.73 ( 13,329 ) $ 36.47 Forfeited ( 20,109 ) $ 60.75 — $ — — $ — — $ — Balance at December 31, 2024 232,340 $ 57.78 — $ — 263,597 $ 57.62 34,490 $ 53.06 (1) Adjustments during the first quarter of 2024 for (i) an additional 77,498 units for PSUs granted in 2023 to reflect 200.0 % of the target amount granted based on the Company's actual ROIC compared to ROIC target for the performance period ended December 31, 2023, and (ii) a reduction of 764 units for PSUs granted in 2020 to reflect 93.0 % of the target amount granted based on individual performance goals ended December 31, 2023. 52 Table of Contents (2) Vested and issuable upon termination from service as a member of the Company's Board of Directors. The fair value of the restricted stock units, common stock, performance stock units with a financial performance condition, and deferred stock units granted during the three years ended December 31, 2024 was based on the Company's stock price at grant date of the award. The following table sets forth the aggregate fair value of restricted stock units, common stock, performance stock units with a financial performance condition, and deferred stock units that vested during the years ended December 31 (in thousands): 2024 2023 2022 Aggregate fair value of vested restricted stock units $ 4,626 $ 4,740 $ 3,920 Aggregate fair value of vested common stock $ 519 $ 460 $ 665 Aggregate fair value of vested performance stock units $ 788 $ 3,999 $ 6,729 Aggregate fair value of vested deferred stock units $ 230 $ 345 $ 105 As of December 31, 2024, there was $ 9.5 million of total unrecognized compensation cost related to non-vested restricted stock units and performance stock units. This cost is expected to be recognized over a weighted average period of 2.0 years. Equity Based Awards - Settled in Cash Management Stock Purchase Plan The Company's equity-based awards that are settled in cash are the awards under the Management Stock Purchase Plan (the "MSPP") which is authorized under the Company's equity incentive plans. The MSPP provides participants the ability to defer a portion of their compensation, convertible to unrestricted investments, restricted stock units, or a combination of both, or defer a portion of their directors’ fees, convertible to restricted stock units. Employees eligible to defer a portion of their compensation also receive a company-matching award in restricted stock units equal to a percentage of their deferred compensation. The deferrals and related company match are credited to an account that represents a share-based liability. The portion of the account deferred to unrestricted investments is measured at fair market value of the unrestricted investments, and the portion of the account deferred to restricted stock units and company-matching restricted stock units is measured at a 200-day average of the Company's stock price. The account will be converted to and settled in cash payable to participants upon retirement or a termination of their service to the Company. Total MSPP liabilities recorded on the consolidated balance sheet as of December 31, 2024 were $ 23.7 million, of which $ 3.2 million was included in accrued expenses and $ 20.5 million was included in other non-current liabilities. Total MSPP liabilities recorded on the consolidated balance sheet as of December 31, 2023 were $ 20.0 million, of which $ 2.0 million was included in accrued expenses and $ 18.0 million was included in other non-current liabilities. The value of the restricted stock units within the MSPP liabilities was $ 18.1 million and $ 17.3 million at December 31, 2024 and 2023, respectively. The following table provides the number of restricted stock units credited to active participant accounts, balance of vested and unvested restricted stock units within active participant accounts, payments made with respect to MSPP liabilities and MSPP expense during years ended December 31: 2024 2023 2022 Restricted stock units credited 43,566 48,921 12,365 Restricted stock units balance, vested and unvested 205,221 199,946 158,644 Share-based liabilities paid (in thousands) $ 2,821 $ 2,392 $ 3,689 MSPP expense (recovery) (in thousands) $ 3,890 $ 4,710 $ ( 4,459 ) (10) FAIR VALUE MEASUREMENTS Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Depending on the nature of the asset or liability, various techniques and assumptions can be used to estimate fair value. A financial asset or liability’s classification 53 Table of Contents within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement as follows: • Level 1 - Quoted prices in active markets for identical assets or liabilities. • Level 2 - Observable inputs other than quoted prices in active markets for similar assets and liabilities. • Level 3 - Inputs that are unobservable inputs for the asset or liability. The Company had no financial assets or liabilities measured at fair value on a recurring basis and did not have any financial instruments for which carrying value differed from its fair value at December 31, 2024 and 2023. As of December 31, 2024, the Company had no outstanding indebtedness on its revolving credit facility under its Credit Agreement. The Company’s other financial instruments primarily consist of cash and cash equivalents, accounts receivable, and accounts payable. The carrying values for these financial instruments approximate fair value. The Company did not have any other material assets or liabilities carried at fair value and measured on a recurring basis as of December 31, 2024 and 2023. Other non-recurring fair value measurements The Company recognized intangible asset impairment during the years ended December 31, 2024 and 2023 as noted in Note 6, "Goodwill and Related Intangible Assets." The fair values of the impaired intangible assets for 2024 and 2023 was zero , and the carrying values were $ 11.3 million and $ 3.8 million, respectively. The Company used unobservable inputs, classified as Level 3 inputs, in determining the fair value of these assets. No impairment charges were recognized during the year ended December 31, 2022. The Company also applied fair value principles for the goodwill impairment tests performed during 2024, 2023, and 2022. In 2024, the Company elected to performed a quantitative test using two valuation models to estimate the fair values for one of its reporting units and qualitative tests for the remaining five reporting units. In 2023 and 2022, the Company performed quantitative test using two valuation models to estimate the fair values for all its reporting units. Both models primarily use Level 3 inputs. See Note 6 "Goodwill and Related Intangible Assets" of the consolidated financial statements for the results of the Company’s goodwill impairment tests. Additionally, as described in Note 5 "Acquisitions and Divestitures," the Company used Level 3 inputs to estimate fair values allocated to the assets acquired and liabilities assumed related to acquisitions. (11) EXIT ACTIVITY COSTS AND ASSET IMPAIRMENTS The Company has incurred exit activity costs and asset impairment charges as a result of its 80/20 simplification and portfolio management initiatives. These initiatives have resulted in the identification of low-volume, low margin, internally-produced products which have been or will be outsourced or discontinued, the simplification of processes, the sale and exiting of less profitable businesses or products lines, and the reduction in the Company's manufacturing footprint. As a result of process simplification initiatives, the Company has incurred exit activity costs (recoveries) related to moving and closing costs, severance and contract terminations, along with asset impairment charges (recoveries) related to the write-down of inventory and other charges such as warranty costs associated with discontinued product lines. Additionally, the Company has incurred the aforementioned costs resulting from the sale, relocation and/or closure of facilities including two closures and one relocation in 2022. The following table sets forth the exit activity costs (recoveries) and asset impairment charges (recoveries) incurred by segment during the years ended December 31 related to the restructuring activities described above (in thousands): 54 Table of Contents 2024 2023 2022 Exit Activity Asset Impairment Total Exit Activity Asset Impairment Total Exit Activity Asset Impairment Total Residential $ 678 $ ( 72 ) $ 606 $ 960 $ 3,851 $ 4,811 $ 1,825 $ 12 $ 1,837 Renewables 9,792 103 9,895 7,558 1,136 8,694 3,256 1,198 4,454 Agtech 477 — 477 718 — 718 771 1,066 1,837 Infrastructure — — — — — — ( 63 ) — ( 63 ) Corporate 83 — 83 ( 32 ) — ( 32 ) 250 — 250 Total $ 11,030 $ 31 $ 11,061 $ 9,204 $ 4,987 $ 14,191 $ 6,039 $ 2,276 $ 8,315 The following table provides a summary of where the above exit activity costs and asset impairments are recorded in the consolidated statements of income for the years ended December 31 (in thousands): 2024 2023 2022 Cost of sales $ 8,514 $ 12,634 $ 5,258 Selling, general, and administrative expense 2,547 1,557 3,057 Total exit activity costs and asset impairments $ 11,061 $ 14,191 $ 8,315 The following table reconciles the beginning and ending liability for exit activity costs recorded in current accrued expenses on the consolidated balance sheet relating to the Company’s restructuring efforts (in thousands): 2024 2023 Balance as of January 1 $ 6,725 $ 2,417 Exit activity costs recognized 11,030 9,204 Cash payments ( 5,744 ) ( 4,896 ) Balance as of December 31 $ 12,011 $ 6,725 (12) INCOME TAXES The Company uses the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to reverse. The components of income before taxes consisted of the following for the years ended December 31 (in thousands): 2024 2023 2022 Domestic $ 167,870 $ 149,348 $ 112,635 Foreign 6,055 ( 356 ) ( 1,145 ) Income before taxes $ 173,925 $ 148,992 $ 111,490 55 Table of Contents The provision for income taxes for the years ended December 31 consisted of the following (in thousands): 2024 2023 2022 Current: U.S. Federal $ 28,126 $ 21,579 $ 17,014 State 7,838 6,048 5,647 Foreign 1,103 32 86 Total current 37,067 27,659 22,747 Deferred: U.S. Federal ( 440 ) 8,617 5,259 State ( 244 ) 2,112 1,381 Foreign 202 71 ( 303 ) Total deferred ( 482 ) 10,800 6,337 Provision for income taxes $ 36,585 $ 38,459 $ 29,084 The provision for income taxes differs from the federal statutory rate of 21 % due to the following for the years ended December 31 (in thousands, except for percentages) : 2024 2023 2022 Statutory rate $ 36,524 21.0 % $ 31,288 21.0 % $ 23,413 21.0 % State taxes, less federal effect 5,990 3.5 % 6,446 4.3 % 5,541 5.0 % Federal tax credits ( 2,194 ) ( 1.3 ) % ( 787 ) ( 0.5 ) % ( 549 ) ( 0.5 ) % Excess tax benefit on stock based compensation ( 292 ) ( 0.2 ) % ( 203 ) ( 0.1 ) % ( 214 ) ( 0.2 ) % Executive compensation 1,756 1.0 % 1,369 0.9 % 960 0.9 % Valuation allowance ( 6,027 ) ( 3.5 ) % — — % — — % Other 828 0.5 % 346 0.2 % ( 67 ) ( 0.1 ) % $ 36,585 21.0 % $ 38,459 25.8 % $ 29,084 26.1 % Deferred tax liabilities at December 31 consisted of the following (in thousands): 2024 2023 Depreciation $ 13,523 $ 13,838 Goodwill 69,155 65,967 Operating leases 11,265 11,325 Intangible assets — 1,919 Other 1,890 1,847 Gross deferred tax liabilities 95,833 94,896 Capitalized research and development costs ( 8,184 ) ( 6,286 ) Equity compensation ( 7,148 ) ( 6,907 ) Operating leases ( 11,670 ) ( 11,678 ) Intangible assets ( 854 ) — Capital loss carryforward ( 19,392 ) ( 26,527 ) Warranty reserves ( 3,901 ) ( 1,790 ) Other ( 7,476 ) ( 11,215 ) Gross deferred tax assets ( 58,625 ) ( 64,403 ) Valuation allowances 19,434 26,593 Deferred tax assets, net of valuation allowances ( 39,191 ) ( 37,810 ) Net deferred tax liabilities $ 56,642 $ 57,086 At December 31, 2024, the Company had total net operating loss carry forwards of $ 16.9 million, which included $ 0.2 million for federal and $ 16.7 million for state. There was no foreign net operating loss carry forward. The federal and state net operating loss carry forwards expire between 2031 and 2044. The Company recognized a 56 Table of Contents total of $ 0.8 million of deferred tax assets, net of the federal tax benefit, related to these net operating losses prior to any valuation allowances, which included $ 0.1 million of federal and $ 0.8 million of state deferred tax assets. As a result of the sale of the Industrial business during 2021, the Company generated a capital loss of $ 113.7 million for federal and state purposes to the extent allowable under state tax regulations. Amended Federal returns were filed to carry back $ 3.7 million of capital loss. As a result of the sale of the Company's electronic locker business within its Residential segment in 2024, $ 28.7 million of the capital loss was utilized to offset the capital gain from the sale, and the valuation allowance was subsequently adjusted. As of December 31, 2024, the remaining capital loss carry forward is $ 81.3 million. The capital loss carryforward will expire in 2026. The Company recognized a total of $ 19.4 million of deferred tax assets, net of the federal benefit, related to this carryforward prior to any valuation allowances, which included $ 16.5 million of federal and $ 2.9 million of state deferred tax assets. The Company has a full valuation allowance on the capital loss carry forward and as a result there is no deferred tax asset related to the capital loss. Deferred taxes include net deferred tax assets relating to certain state and foreign tax jurisdictions. A reduction of the carrying amount of deferred tax assets by a valuation allowance is required if it is more likely than not that such assets will not be realized. The following sets forth a reconciliation of the beginning and ending amount of the Company’s valuation allowance (in thousands): 2024 2023 2022 Balance as of January 1 $ 26,593 $ 26,488 $ 26,581 Cost charged to the tax provision 11 105 10 Reductions ( 7,170 ) — ( 103 ) Balance as of December 31 $ 19,434 $ 26,593 $ 26,488 At December 31, 2024, the Company had approximately $ 3.7 million of undistributed earnings of foreign subsidiaries. The Company continues to maintain its assertion that all remaining foreign earnings will be indefinitely reinvested. Any excess earnings could be used to grow the Company's foreign operations through launches of new capital projects or additional acquisitions. Determination of the amount of unrecognized deferred U.S. income tax liability related to the Company's remaining unremitted foreign earnings is not practicable due to the complexities associated with its hypothetical calculation. The Company did not have any unrecognized tax benefits or activity related to such benefits in any of the years presented in the consolidated financial statements. The Company classifies accrued interest and penalties related to unrecognized tax benefits in income tax expense. No interest or penalties have been recognized during the years presented. The Company and its U.S. subsidiaries file a U.S. federal consolidated income tax return. Foreign and U.S. state jurisdictions have statute of limitations generally ranging from four to ten years . In December 2021, the Organization for Economic Cooperation and Development introduced Base Erosion and Profit Shifting ("BEPS") Pillar 2 rules that impose a global minimum tax rate of 15%. Numerous countries, including European Union member states, have enacted or are expected to enact legislation to be effective for tax years beginning as early as January 1, 2024, with general implementation of global minimum tax by January 1, 2025. The Company considered the impacts of BEPS Pillar 2 on its consolidated financial statements and determined that it meets the revenue threshold to be a BEPS taxpayer, however, the Company has met the safe harbor tests such that no additional tax liability applies. 57 Table of Contents (13) EARNINGS PER SHARE Weighted average shares outstanding for basic and diluted earnings were as follows for the years ended December 31 (in thousands): 2024 2023 2022 Basic weighted average shares outstanding 30,538 30,626 32,096 Dilutive effect of common stock options and stock units 231 159 96 Diluted weighted average shares outstanding 30,769 30,785 32,192 The following table provides the potential anti-dilutive common stock units not included in the diluted weighted average shares calculations for the years ended December 31 (in thousands): 2024 2023 2022 Common stock units — 26 43 (14) LEASES The Company's leases are classified as operating leases and consist of manufacturing facilities, distribution centers, office space, vehicles and equipment. Most of the Company's leases include one or more options to renew, with renewal terms that can extend the respective lease term from one month to ten years . The exercise of lease renewal options is at the Company's sole discretion. As of December 31, 2024 and 2023, the Company's renewal options are not part of the Company's operating lease assets and operating lease liabilities. Certain leases also include options to purchase at fair value the underlying leased asset at the Company's sole discretion. The components of lease costs for the years ended December 31 were as follows (in thousands): 2024 2023 2022 Operating lease cost $ 16,370 $ 12,940 $ 11,191 Short-term lease cost 5,679 4,645 5,694 Total lease cost $ 22,049 $ 17,585 $ 16,885 Information related to the Company's operating right-of-use assets and related operating lease liabilities for the years ended December 31 were as follows (in thousands): 2024 2023 2022 Cash paid for amounts included in the measurement of operating liabilities $ 12,876 $ 10,628 $ 8,835 Right-of-use assets obtained in exchange for new lease liabilities $ 10,939 $ 27,468 $ 17,008 Information related to the Company's lease terms and discount rates as of December 31 were as follows: 2024 2023 Weighted-average remaining lease term - operating leases 5.8 years 6.6 years Weighted-average discount rate - operating leases 5.2 % 5.0 % 58 Table of Contents The future maturity of the Company's lease liabilities as of December 31, 2024 were as follows (in thousands): 2025 $ 13,571 2026 10,959 2027 6,013 2028 5,165 2029 4,698 After 2029 13,753 Total lease payments 54,159 Less: present value discount ( 7,561 ) Present value of lease liabilities $ 46,598 The Company uses its incremental borrowing rate based on information available at the commencement date of a lease in determining the present value of lease payments as the rates implicit in most of the Company's leases are not readily determinable. (15) COMMITMENTS AND CONTINGENCIES The Company is a party to certain claims and legal actions generally incidental to its business. Management does not believe that the outcome of any claims, or other claims which are not clearly determinable at the present time, would result in a material adverse effect on the Company's financial condition or results of operations. (16) SEGMENT INFORMATION The Company has four reportable segments: Residential, Renewables, Agtech and Infrastructure. The Company's reportable segments are each managed separately because they design, engineer, manufacture, and where applicable install, distinct products with different production processes. • Residential consists of operating segments that sell the following products and services to major retail home centers, building material wholesalers, building product distributors, roofing distributors, residential contractors, property management companies, manufactured housing dealers, postal services distributors and providers, and online direct to end consumers: roof and foundation ventilation products, single point and centralized mail systems and electronic package solutions, outdoor living space products (sun-shading), rain dispersion systems, metal roofing job site services, and other construction accessories. • Renewables consists of an operating segment that sells the following products and services to developers, EPCs and owners / operators of solar fields: design, manufacture and install solar energy mounting systems including foundation, racking, and electrical balance of system. • Agtech consists of an operating segment that sells the following products and services to large-scale indoor commercial growers and agricultural research and development facilities: design, manufacture and build advanced-technology turnkey greenhouse growing facilities. • Infrastructure consists of an operating segment that sells the following products to commercial and transportation contractors and fabricators: expansion joints, structural bearings, rubber pre-formed seals and other sealants, elastomeric concrete, and bridge cable protection systems. When determining the Company's Residential reportable segment, the Company aggregated operating segments to be one reportable segment as the aggregation is consistent with the objectives and principles of Topic 280, Segment Reporting, and on the basis that the operating segments have similar economic and operating characteristics. The accounting policies of the Company's segments are the same as those described in Note 1 "Summary of Significant Accounting Policies." The Company evaluates performance of all its reportable segments on income or loss from operations before interest and income taxes. The following tables illustrate certain measurements used by management to assess the performance of the segments described above for the years ended December 31 (in thousands): 59 Table of Contents 2024 Residential Renewables Agtech Infrastructure Total Net sales $ 782,519 $ 285,405 $ 152,811 $ 88,029 $ 1,308,764 Less (1): Operating expenses (2) 633,735 282,056 141,771 66,734 1,124,296 Segment profit 148,784 3,349 11,040 21,295 184,468 Reconciliation of segment profit Unallocated corporate expenses ( 41,445 ) Interest income, net 6,171 Other income, net 24,731 Income before taxes $ 173,925 2023 Residential Renewables Agtech Infrastructure Total Net sales $ 814,803 $ 330,738 $ 144,967 $ 87,228 $ 1,377,736 Less (1): Operating expenses (2) 671,735 300,578 145,895 68,699 1,186,907 Segment profit (loss) 143,068 30,160 ( 928 ) 18,529 190,829 Reconciliation of segment profit Unallocated corporate expenses ( 40,100 ) Interest expense, net ( 3,002 ) Other income, net 1,265 Income before taxes $ 148,992 2022 Residential Renewables Agtech Infrastructure Total Net sales $ 767,248 $ 377,567 $ 168,868 $ 76,283 $ 1,389,966 Less (1): Operating expenses (2) 640,790 352,324 165,954 67,280 1,226,348 Segment profit 126,458 25,243 2,914 9,003 163,618 Reconciliation of segment profit Unallocated corporate expenses ( 33,516 ) Interest expense, net ( 4,047 ) Other expense, net ( 14,565 ) Income before taxes $ 111,490 Footnotes: (1) The significant expense category and amounts align with the segment-level information that is regularly provided to the CODM. (2) Operating expenses for each reportable segment includes inventory and manufacturing expenses, employee compensation, depreciation and amortization, freight services, other costs of sales expenses, and other selling, general and administrative expenses. Additionally, operating expenses includes intangible asset impairment recognized in the Renewables and Agtech reportable segments during the year ended December 31, 2024 and intangible asset impairment in Agtech reportable segment during year ended December 31, 2023. There was no intangible asset impairment recognized during the year ended December 31, 2022. The Company’s CODM consisted of the Company’s chief executive officer during the years ended December 31, 2024, 2023 and 2022. For the Company’s reportable segments, the CODM uses segment income (loss) from operations before interest and income taxes to assess segment performance and allocate resources (including employees, property, and capital resources) for each segment mainly in the annual budget and forecasting process. The CODM considers forecast-to-actual variances on a monthly basis using the income (loss) from operation before 60 Table of Contents interest and taxes for each segment when making decisions about allocating capital and personnel to the segments. The CODM also uses income (loss) from operations before interest and income taxes, along with net sales, to assess the performance for each segment by comparing the results of each segment with one another and in the compensation of certain employees. The following tables are the reported segment’s and unallocated corporate reported depreciation and amortization, and capital expenditures for the years ended December 31 (in thousands): 2024 2023 2022 Depreciation and Amortization Residential $ 10,416 $ 10,080 $ 8,983 Renewables 8,192 8,671 8,467 Agtech 3,165 3,789 4,377 Infrastructure 2,972 3,137 3,150 Unallocated corporate expenses 2,567 1,701 1,190 Total depreciation and amortization $ 27,312 $ 27,378 $ 26,167 Capital expenditures Residential $ 10,508 $ 6,913 $ 10,050 Renewables 3,101 1,113 3,589 Agtech 684 1,419 3,177 Infrastructure 1,152 1,313 1,898 Unallocated corporate expenditures 5,030 4,239 1,424 Total capital expenditures $ 20,475 $ 14,997 $ 20,138 The following table is the reported segment’s and unallocated corporate assets at December 31 (in thousands): 2024 2023 2022 Residential $ 497,317 $ 515,739 $ 519,567 Renewables 390,881 377,694 392,368 Agtech 156,929 168,213 193,966 Infrastructure 78,366 77,518 80,264 Unallocated corporate assets 295,917 117,287 24,448 Total assets $ 1,419,410 $ 1,256,451 $ 1,210,613 61 Table of Contents The following presents disaggregated revenue by timing of transfer of control to customers by reported segment for the years ended December 31 (in thousands): 2024 Residential Renewables Agtech Infrastructure Total Point in Time $ 775,541 $ 30,985 $ 2,862 $ 34,393 $ 843,781 Over Time 6,978 254,420 149,949 53,636 464,983 Total net sales $ 782,519 $ 285,405 $ 152,811 $ 88,029 $ 1,308,764 2023 Residential Renewables Agtech Infrastructure Total Point in Time $ 808,225 $ 49,123 $ 4,920 $ 31,547 $ 893,815 Over Time 6,578 281,615 140,047 55,681 483,921 Total net sales $ 814,803 $ 330,738 $ 144,967 $ 87,228 $ 1,377,736 2022 Residential Renewables Agtech Infrastructure Total Point in Time $ 761,576 $ 27,317 $ 13,011 $ 32,983 $ 834,887 Over Time 5,672 350,250 155,857 43,300 555,079 Total net sales $ 767,248 $ 377,567 $ 168,868 $ 76,283 $ 1,389,966 Net sales by region or origin and long-lived assets by region of domicile for the years ended and as of December 31 were as follows (in thousands): 2024 2023 2022 Net sales North America $ 1,308,764 $ 1,366,012 $ 1,373,907 Asia — 11,724 16,059 Total net sales $ 1,308,764 $ 1,377,736 $ 1,389,966 Long-lived assets North America $ 156,707 $ 154,778 $ 136,553 Asia 70 59 234 Total long-lived assets $ 156,777 $ 154,837 $ 136,787 (17) SUBSEQUENT EVENT On February 11, 2025, the Company purchased all the outstanding stock of Lane Supply, Inc., a privately held company that designs, manufactures and installs structural canopies serving the convenience store, travel center, food retail, and quick serve restaurant markets, for $ 120 million in an all cash transaction, subject to customary working capital and other adjustments, and for which the preliminary purchase price allocation has not yet been determined. Lane Supply, Inc. will be reported as part of the Company's Agtech segment. 62 Table of Contents Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure Not applicable.