What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2022-02-28 compared with 2021-02-26 · 49 added, 41 removed, 187 unchanged (32% of the section changed)

Company Background

Simpson Manufacturing Co,.

Simpson Manufacturing Co., Inc.

("Simpson," the "Company," "we," "us," or "our,") through our wholly-owned subsidiary, Simpson Strong-Tie Company Inc.

("SST"), design, engineer and are a leading manufacturer of high quality wood and concrete building construction products designed to make structures safer and more secure, and that perform at high levels.

Our products are designed to be easy to use and cost-effective for customers.

("SST"), designs, engineers and is a leading manufacturer of high quality wood and concrete construction products designed to make structures safer and more secure.

Our products are designed to perform at high levels and be easy to use and cost-effective for customers.

Our wood construction products are used in light-frame construction and include connectors, truss plates, fastening systems, fasteners and pre-fabricated lateral resistive systems.

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The Company attracts and retains customers by designing, manufacturing and selling high quality products that perform well, are easy to use and cost-effective for customers.

The Company manufactures and warehouses its products in geographic proximity to its markets to provide availability and rapid delivery of products to customers and prompt response to customer requests for specially designed products and services.

The Company manufactures and warehouses its products in geographic proximity to its markets to help ensure availability and facilitate rapid delivery to customers, which enables us to promptly respond to customer requests for specially designed products and services.

The Company maintains levels of inventory intended to operate with minimum backlog and fill most customer orders within a few days.

High levels of manufacturing automation and flexibility allow the Company to maintain its quality standards while continuing to provide prompt delivery.

High levels of manufacturing automation and flexibility allow the Company to maintain its high quality standards while continuing to provide prompt delivery to meet our customers' needs.

The Company intends to continue efforts to increase market share in both the wood construction and concrete construction product groups by:

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• continuing to sponsor seminars to inform architects, engineers, contractors and building officials on appropriate use, proper installation and identification of the Company’s products;

• continuing to invest in mobile, web and software applications for customers to help them do their jobs more efficiently and connect with customers utilizing social media, blog posts and videos;

• continuing to invest in mobile, web and software applications for customers to both help them do their jobs more efficiently and allow us to connect with them utilizing social media, blog posts and videos;

• continuing to invest in Building Information Modeling ("BIM") software services and solutions for home builders and lumber-building material suppliers;

• continuing to innovate and diversify our product offerings.

• continuing to innovate, advance and diversify our product offerings.

Products and Services

Historically, the Company’s product lines historically have encompassed connectors, anchors, fasteners, lateral resistive systems, truss plates, as well as repair and strengthening product lines for the marine, industrial and transportation markets.

Historically, the Company’s product lines have encompassed connectors, anchors, fasteners, lateral resistive systems, and truss plates, as well as repair and strengthening product lines for the industrial and transportation markets.

See “Item 7 — Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and “Note 18 — Segment Information” to the Company’s Consolidated Financial Statements for financial information regarding revenues by product category.

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To achieve these approvals, the Company conducts extensive product testing, which is witnessed and certified by independent testing laboratories.

The tests also provide the basis of load ratings for the Company’s structural products.

This test and load information is used by architects, engineers, contractors, building officials, and homeowners and is useful across all applications of the Company’s products, ranging from the deck constructed by a homeowner to a multi-story structure designed by an architect or engineer.

These tests also provide the basis of load ratings for the Company’s structural products.

This test and load information is used by architects, engineers, contractors, building officials, and homeowners in selecting our products and comparing them to those of competitors, and is useful across all applications of the Company’s products, ranging from the deck constructed by a homeowner to a multi-story structure designed by an architect or engineer.

Wood Construction Products.

The Company produces and markets over 14,000 standard and custom wood construction products.

These products are used primarily to strengthen, support and connect wood applications in residential and commercial construction and DIY projects.

The Company’s wood construction products contribute to structural integrity and resistance to seismic, wind and gravity forces.

These products are used primarily to strengthen, support and connect wood applications in residential and commercial

construction and DIY projects.

The Company’s wood construction products contribute to structural integrity and resistance to seismic, wind and gravitational forces.

As described below, the Company’s wood construction products include:

• Connectors - Connectors are prefabricated metal products that attach wood, concrete, masonry or steel together and are essential for tying wood construction elements together and create safer and stronger buildings.

Included in this category are connectors, holddowns, and truss connector plates, for example;

Included in this category are connectors, holddowns, and truss connector plates.

• Fasteners - The fastening line includes various nails, screws and staples, which are complemented by the Company's Quik Drive auto-feed screw driving system, which is used in numerous applications such as decking, subfloors, drywall and roofing;

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They are used primarily to anchor, protect and strengthen concrete, brick and masonry applications in industrial, infrastructure, residential, commercial and DIY projects.

The Company’s concrete construction products contribute to structural integrity and resistance to seismic, wind and gravity forces.

The Company’s concrete construction products contribute to structural integrity and resistance to seismic, wind and gravitational forces.

These products are sold in all segments of the Company.

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• OEM Relationships.

The Company works closely with manufacturers of engineered wood, composite laminated timber and OEMs for off-site construction to develop and expand the application and sales of its engineered wood connector, fastener, anchor, and truss products.

The Company works closely with manufacturers of engineered wood, composite laminated timber and original equipment manufacturers ("OEMs") for off-site construction to develop and expand the application and sales of its engineered wood connector, fastener, anchor, and truss products.

The Company has relationships with many of the leaders in these industries.

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The Company has established a presence in Europe through acquisition of companies with existing customer bases and through servicing U.S.-based customers operating in Europe.

The Company also distributes connector, anchor and epoxy products in Mexico, Chile, Australia and New Zealand.

The Company also distributes connector, anchor and epoxy products in Canada, Mexico, Chile, Australia and New Zealand.

The Company seeks to expand existing and identify new distributions channels in the markets we serve, and expand into new markets.

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These segments are similar in several ways, including similarities in the products manufactured and distributed, the types of materials used, the production processes, the distribution channels and the product applications.

The Company commits substantial resources to new product development.

As previously disclosed, on January 26, 2022, the Company, via its wholly-owned subsidiary Simpson Strong-Tie Europe, entered into a securities purchase agreement providing for the Company’s acquisition of the Etanco Group ( “Etanco”).

Etanco is a leading designer, manufacturer and distributor of fixing and fastening solutions for the European building and construction market.

Etanco’s business model and core product offerings align with the Company, and we anticipate that the acquisition of Etanco will support continued growth in our European business, including expansion into new geographies, sales channels and commercial building offerings.

For more information about the pending acquisition, see “Item 7 — Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

In order to innovate, advance and diversify our product offerings, the Company commits substantial resources to new product development.

The majority of SST’s products have been developed through its internal research and development program.

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The Company’s product research and development is based largely on products or solutions that are identified within the Company, feedback or requests from customers for new or specialty products and in connection with the Company’s strategic initiatives to expand into new markets and/or develop new product lines.

The Company’s strategy is to develop new products on a proprietary basis, to seek patents when appropriate and to rely on trade secret protection for others.

The Company’s strategy is to develop new products on a proprietary basis, to seek patents when appropriate and to rely on trade secret protection for others or depending on availability and circumstances, the Company will acquire products or solutions meeting our strategic initiatives.

Since at least 2006, the Company has developed 15 to 25 new products each year.

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• new connectors and lateral products for wood framing applications;

• new connectors for timber & offsite constructions;

• new steel connections for mid-rise steel construction;

• new connectors and fasteners for mass timber & offsite constructions;

• connections for structural steel construction;

• new connectors for cold formed steel applications;

• new fastener products for wood construction;

• new fastener products and tools for wood construction;

• new mechanical and adhesive anchors for concrete and masonry construction;

• new repair and strengthening systems for concrete, masonry and wood pile applications.

The Company intends to continue to expand its product offering.

By executing on its research and development strategy, the Company intends to continue to expand its product offerings.

The Company provides expertise and resources to offer software solutions and services to builders and lumber building material dealers, and supports efforts to further develop integrated software component solutions for the building industry.

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Our mission is to provide solutions that help people design and build safer, stronger structures.

Our products improve the performance and integrity of the structures they are installed in, helping to make those structures more sustainable, and often helping to save lives in times of natural disasters.

Today, we offer over 14,000 wood construction products, and over 1,000 concrete construction products for the residential construction, light industrial and commercial construction, remodeling, and repair & remodel markets.

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Currently, 22 of the top 25 U.S.

builders are engaged on our builders program.

builders (based on number of housing starts per year) are engaged in our builder program.

In terms of home centers, we were pleased to welcome back Lowe’s as a home center customer in the second quarter of 2020.

By the end of the year, we had successfully completed the rollout of our product sets in over 1,700 Lowe’s stores.

By the end of the fiscal year 2020, we had successfully completed the rollout of our product sets in over 1,700 Lowe’s stores.

We encounter a variety of competitors that vary by product line, end market and geographic area.

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While we do not believe that any single company competes with us across all of our product lines and distribution channels, certain companies compete in one or more product categories and/or distribution channels.

For over 60 years, through our wholly-owned subsidiary, Simpson Strong-Tie Company Inc., we have led the industry with a majority market share in the wood connectors products space and a growing presence in both the concrete and fastener markets in the US and Europe.

For over 65 years, through our wholly-owned subsidiary, Simpson Strong-Tie Company Inc., we have led the industry with a majority market share in the wood connectors products space and a growing presence in both the concrete and fastener markets in the U.S.

We’ve successfully increased our market share over the years through:

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• active involvement with code officials to improve building codes and construction practices.

We believe these value-added services are competitive differentiators and provide us with a competitive advantage, helping us to achieve industry-leading margins, strong brand recognition and a trusted reputation.

We believe these value-added services are competitive differentiators for us and provide us with a competitive advantage, helping us to achieve industry-leading margins, strong brand recognition and a trusted reputation.

We also provide engineering services in support of some of our products and increasingly offer design and other software that facilitates the specification, selection and use of our products.

We are also investing in software technology, such as 3D visualization software tools, truss design and specification software and Building Information Modeling software (“BIM”), in order to drive increased specification and use of our building material products with homeowners, truss component manufacturers, builders and distributors as well as to support our customers with additional solutions and services.

We are also investing in software technology, such as 3D visualization software tools, truss design and specification software and BIM software, in order to drive increased specification and use of our building material products with homeowners, truss component manufacturers, builders and distributors as well as to support our customers with additional solutions and services.

housing starts are a leading indicator for a significant portion of our business.

In an effort to help mitigate our exposure to the cyclicality of the U.S.

housing market, as well as to respond to the needs of our customers, we’ve made investments over the years in adjacent products such as anchors, fasteners and software solutions as well as expanded operations into Europe through acquisitions.

housing market, as well as to respond to the needs of our customers, we’ve made investments over the years in adjacent products such as anchors, fasteners and software solutions and expanded operations into Europe through acquisitions.

Raw Materials

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The Company purchases raw materials from a variety of commercial sources.

The Company’s practice is to seek cost savings and enhanced quality by purchasing from a limited number of suppliers.

The Company’s practice is to seek cost savings and enhanced quality by developing business relationships with and purchasing from a limited number of suppliers.

The steel industry is highly cyclical and prices for the Company’s raw materials are influenced by numerous factors beyond the Company’s control.

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Given current conditions, including significant import tariffs and duties, and unsettled international trade disputes, the Company currently expects that the high degree of uncertainty regarding steel prices will continue.

Numerous factors may cause steel prices to increase in the future.

Numerous factors may cause steel prices to remain high in the future.

In addition to increases in steel prices, steel mills may add surcharges for zinc, energy and freight in response to increases in their costs.

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These patents, and applications for new patents, cover various design aspects of the Company’s products, as well as processes used in their manufacture.

The Company continues to develop new potentially patentable products, product enhancements and product designs.

The Company continues to develop new potentially patentable products, product enhancements and product designs as well as acquire patented product.

Although the Company does not intend to apply for additional foreign patents covering existing products, the Company has developed an international patent program to protect new products that it may develop.

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Human Capital Resources

Successful execution of our strategy is dependent on attracting, developing and retaining key employees and members of our management team.

Successful execution of our strategy is largely dependent on attracting, developing and retaining key employees and members of our management team.

The skills, experience and industry knowledge of our employees significantly benefit our operations and performance.

We continuously evaluate, modify, and enhance our internal processes and technologies to increase employee engagement, productivity, and efficiency opportunities, skills, and resources they need to be successful.

We continuously evaluate, modify, and enhance our internal processes and technologies to increase employee engagement, productivity, and efficiency and provide the opportunities, skills, and resources they need to be successful.

At December 31, 2021, our employees, including those employed by consolidated subsidiaries, by region were approximately:

North America

Inclusion & Diversity

We strive to have a diverse culture of employees representing different genders, ages, ethnicities and abilities.

Our commitment to diversity and inclusion starts at the top with a highly skilled and diverse board.

At December 31, 2021, we had the following global gender demographics:

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Senior Leadership

Inclusion & Diversity

We strive to have a diverse culture of employees representing different genders, ages, ethnicities and abilities.

Our commitment to diversity and inclusion starts at the top with a highly skilled and diverse board.

At December 31, 2021, our U.S.

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56 % 51 % 79 % 91 %

Not disclosed 6 % 7 % 1 % — %

Talent Development

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We believe our compensation philosophy and strategy are strongly aligned with our corporate strategic priorities and our vision for stockholder value creation.

In addition to our financial compensation we offer a health and wellness package to our employees, which is designed to provide employees with options for their individual and/or family needs.

In addition to our financial compensation we offer a health and wellness package to our employees, which is designed to provide employees with a range of options that are customizable to suit their individual and/or family needs.

In addition, in an effort to continue to attract, retain, and motivate our workforce, in the U.S., we offer remote and flexible work packages for positions which allow for remote work.

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Importantly during 2021, our experience and continuing focus on workplace safety have enabled us to preserve business continuity without sacrificing our commitment to keeping our colleagues and workplace visitors safe during the COVID-19 pandemic.

In response to the COVID-19 pandemic, we have implemented various measures in an effort to better protect our employees.

At the onset of the pandemic we established a Crisis Management Team (the "CMT") to monitor new COVID-19 related developments and support our operations to respond to the ever-changing landscape:

• The CMT consists of senior members of management including our CEO, CFO, President of Sales, General Counsel, and Heads of HR, Manufacturing, IT, Internal Communications, and Safety.

• Currently the CMT meets weekly and at onset of the pandemic met daily.

• Currently the CMT meets approximately every other week and at onset of the pandemic met daily.

• The CMT provides updates to the Board of Directors on a regular basis.

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These actions, in addition to generally being deemed an essential business, have enabled us to continue operating our business with minimal disruptions during the pandemic.

We continue to monitor the ongoing impacts of the COVID-19 pandemic and remain committed to the health, safety and well-being of our employees.

Labor Relations

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In Stockton, California, two union contracts will expire in June 2023 and September 2023, respectively.

Also, we have two contracts in San Bernardino County, California that will expire by the end of March 2021 and June 2022, respectively.

Also, we have two union contracts in San Bernardino County, California that will expire in June 2022 and in February 2025.

Based on current information and subject to future events and circumstances, we believe that, even if new agreements are not reached before the existing labor union contracts expire, it is not expected to have a material adverse effect on the Company’s ability to provide products to customers or on the Company’s profitability.

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The Company's website address is www.simpsonmfg.com .

We file or furnish annual, quarterly and current reports, proxy statements and other information with the Unites States Securities and Exchange Commission (the “SEC”).

We file or furnish annual, quarterly and current reports, proxy statements and other information with the SEC.

You may obtain a copy of any of these reports, free of charge, on the "Investor Relations" page our website, as soon as reasonably practicable after we file such material with, or furnish it to the SEC.

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

What changed 10-K

Item 1. Business