Simpson Manufacturing Co., Inc. 10-Q

Item 1. Financial Statements. Simpson Manufacturing Co., Inc. and Subsidiaries Condensed Consolidated Balance Sheets (In thousands, unaudited) September 30, December 31, 2023 2022 2022 ASSETS Current assets Cash and cash equivalents $ 571,006 $ 309,262 $ 300,742 Trade accounts receivable, net 351,164 334,449 269,124 Inventories 504,446 540,020 556,801 Other current assets 51,583 48,416 52,583 Total current assets 1,478,199 1,232,147 1,179,250 Property, plant and equipment, net 382,508 341,233 361,555 Operating lease right-of-use assets 66,144 48,196 57,652 Goodwill 483,413 467,990 495,672 Intangible assets, net 356,450 330,533 362,917 Other noncurrent assets 48,773 84,159 46,925 Total assets $ 2,815,487 $ 2,504,258 $ 2,503,971 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities Trade accounts payable $ 95,267 $ 98,646 $ 97,841 Income tax payable 87,569 15,804 7,897 Accrued liabilities and other current liabilities 222,233 209,216 220,325 Long-term debt, current portion 22,500 22,500 22,500 Total current liabilities 427,569 346,166 348,563 Operating lease liabilities 53,808 38,650 46,882 Long-term debt, net of issuance costs 539,073 660,164 554,539 Deferred income tax and other long-term liabilities 125,546 121,723 140,608 Total liabilities 1,145,996 1,166,703 1,090,592 Commitments and contingencies (see Note 13) Stockholders’ equity Common stock, at par value 426 433 425 Additional paid-in capital 307,149 296,956 298,983 Retained earnings 1,383,184 1,150,115 1,118,030 Treasury stock — ( 74,562 ) — Accumulated other comprehensive loss ( 21,268 ) ( 35,387 ) ( 4,059 ) Total stockholders’ equity 1,669,491 1,337,555 1,413,379 Total liabilities and stockholders’ equity $ 2,815,487 $ 2,504,258 $ 2,503,971 The accompanying notes are an integral part of these condensed consolidated financial statements 4 Simpson Manufacturing Co., Inc. and Subsidiaries Condensed Consolidated Statements of Earnings and Comprehensive Income (In thousands except per-share amounts, unaudited) Three Months Ended Nine Months Ended September 30, September 30, 2023 2022 2023 2022 Net sales $ 580,084 $ 553,662 $ 1,712,093 $ 1,640,464 Cost of sales 297,167 309,139 888,835 899,828 Gross profit 282,917 244,523 823,258 740,636 Operating expenses: Research and development and other engineering 24,751 17,084 67,035 49,892 Selling 52,391 42,539 151,497 124,449 General and administrative 64,793 60,319 197,267 172,511 Total operating expenses 141,935 119,942 415,799 346,852 Acquisition and integration related costs 785 1,866 4,086 14,681 Net gain on disposal of assets ( 16 ) ( 100 ) ( 223 ) ( 1,227 ) Income from operations 140,213 122,815 403,596 380,330 Interest income (expense), net and other finance costs 1,292 ( 2,983 ) 18 ( 6,568 ) Other & foreign exchange loss, net ( 1,429 ) ( 1,707 ) ( 1,471 ) ( 3,814 ) Income before taxes 140,076 118,125 402,143 369,948 Provision for income taxes 36,055 29,882 102,958 93,559 Net income $ 104,021 $ 88,243 $ 299,185 $ 276,389 Other comprehensive income Translation adjustment ( 13,238 ) ( 26,476 ) ( 8,729 ) ( 54,345 ) Unamortized pension adjustments ( 4 ) 459 396 1,147 Cash flow hedge adjustment, net of tax 1,087 26,823 ( 8,876 ) 35,416 Comprehensive net income $ 91,866 $ 89,049 $ 281,976 $ 258,607 Net income per common share: Basic $ 2.44 $ 2.06 $ 7.01 $ 6.42 Diluted $ 2.43 $ 2.06 $ 6.98 $ 6.40 Weighted average number of shares outstanding Basic 42,673 42,813 42,651 43,044 Diluted 42,882 42,916 42,893 43,173 Cash dividends declared per common share $ 0.27 $ 0.26 $ 0.80 $ 0.77 The accompanying notes are an integral part of these condensed consolidated financial statements 5 Simpson Manufacturing Co., Inc. and Subsidiaries Condensed Consolidated Statements of Stockholders’ Equity (In thousands except per-share data, unaudited) Three Months Ended September 30, 2023 and 2022 Common Stock Additional Paid-in Retained Accumulated Other Comprehensive Treasury Shares Par Value Capital Earnings Loss Stock Total Balance at June 30, 2023 42,673 $ 426 $ 301,612 $ 1,290,686 $ ( 9,113 ) $ — $ 1,583,611 Net income — — — 104,021 — — 104,021 Translation adjustment, net of tax — — — — ( 13,238 ) — ( 13,238 ) Pension adjustment and other, net of tax — — — — ( 4 ) — ( 4 ) Cash flow hedges, net of tax — — — — 1,087 — 1,087 Stock-based compensation — — 5,537 — — — 5,537 Cash dividends declared on common stock, $0.27 per share — — — ( 11,523 ) — — ( 11,523 ) Balance at September 30, 2023 42,673 $ 426 $ 307,149 $ 1,383,184 $ ( 21,268 ) $ — $ 1,669,491 Balance at June 30, 2022 42,906 $ 433 $ 293,720 $ 1,072,959 $ ( 36,193 ) $ ( 46,281 ) $ 1,284,638 Net income — — — 88,243 — — 88,243 Translation adjustment and other, net of tax — — — — ( 26,476 ) — ( 26,476 ) Derivative instrument adjustments, net of tax — — — — 26,823 — 26,823 Pension adjustment and other, net of tax — — — — 459 — 459 Stock-based compensation — — 3,236 — — — 3,236 Shares issued from release of Restricted Stock Units 1 — — — — — — Repurchase of common stock ( 309 ) — — — — ( 28,281 ) ( 28,281 ) Cash dividends declared on common stock, $0.26 per share — — — ( 11,087 ) — — ( 11,087 ) Balance at September 30, 2022 42,598 $ 433 $ 296,956 $ 1,150,115 $ ( 35,387 ) $ ( 74,562 ) $ 1,337,555 The accompanying notes are an integral part of these condensed consolidated financial statements 6 Simpson Manufacturing Co., Inc. and Subsidiaries Condensed Consolidated Statements of Stockholders’ Equity (In thousands except per-share data, unaudited) Nine Months Ended September 30, 2023 and 2022 Common Stock Additional Paid-in Retained Accumulated Other Comprehensive Treasury Shares Par Value Capital Earnings Loss Stock Total Balance at December 31, 2022 42,560 $ 425 $ 298,983 $ 1,118,030 $ ( 4,059 ) $ — $ 1,413,379 Net income — — — 299,185 — — 299,185 Translation adjustment, net of tax — — — — ( 8,729 ) — ( 8,729 ) Pension adjustment and other, net of tax — — — — 396 — 396 Cash flow hedges, net of tax — — — — ( 8,876 ) — ( 8,876 ) Stock-based compensation 15,564 — — — 15,564 Shares issued from release of Restricted Stock Units 113 1 ( 7,398 ) — — — ( 7,397 ) Cash dividends declared on common stock, $0.80 per share — — — ( 34,031 ) — — ( 34,031 ) Balance at September 30, 2023 42,673 $ 426 $ 307,149 $ 1,383,184 $ ( 21,268 ) $ — $ 1,669,491 Balance at December 31, 2021 43,217 $ 432 $ 294,330 $ 906,841 $ ( 17,605 ) $ — $ 1,183,998 Net income — — — 276,389 — — 276,389 Translation adjustment, net of tax — — — — ( 54,345 ) — ( 54,345 ) Pension adjustment and other, net of tax — — — — 1,147 — 1,147 Cash flow hedges, net of tax — — — — 35,416 — 35,416 Stock-based compensation — — 11,190 — — — 11,190 Shares issued from release of Restricted Stock Units 138 1 ( 9,524 ) — — — ( 9,523 ) Repurchase of common stock ( 764 ) — — — — ( 74,562 ) ( 74,562 ) Cash dividends declared on common stock, $0.77 per share — — — ( 33,115 ) — — ( 33,115 ) Common stock issued at $139.07 per share for stock bonus 7 — 960 — — — 960 Balance at September 30, 2022 42,598 $ 433 $ 296,956 $ 1,150,115 $ ( 35,387 ) $ ( 74,562 ) $ 1,337,555 The accompanying notes are an integral part of these condensed consolidated financial statements 7 Simpson Manufacturing Co., Inc. and Subsidiaries Condensed Consolidated Statements of Cash Flows (In thousands, unaudited) Nine Months Ended September 30, 2023 2022 Cash flows from operating activities Net income $ 299,185 $ 276,389 Adjustments to reconcile net income to net cash provided by operating activities: Gain on sale of assets and other ( 505 ) ( 1,227 ) Depreciation and amortization 54,224 44,521 Noncash lease expense 10,329 7,982 Inventory step-up expense — 12,151 (Gain) loss in equity method investment, before tax 531 ( 229 ) Deferred income taxes ( 10,829 ) ( 13,156 ) Noncash compensation related to stock plans 17,789 12,986 Provision for doubtful accounts 879 1,146 Deferred hedge gain ( 3,095 ) ( 1,571 ) Changes in operating assets and liabilities Trade accounts receivable ( 85,156 ) ( 55,037 ) Inventories 50,219 ( 27,732 ) Trade accounts payable ( 3,471 ) 4,960 Income taxes payable 79,542 12,930 Other current assets 438 ( 5,711 ) Accrued liabilities and other current liabilities 2,583 12,353 Other noncurrent assets and liabilities ( 14,486 ) ( 17,359 ) Net cash provided by operating activities 398,177 263,396 Cash flows from investing activities Capital expenditures ( 57,483 ) ( 41,571 ) Acquisitions, net of cash acquired ( 17,525 ) ( 806,544 ) Equity method investments ( 712 ) ( 2,768 ) Proceeds from sale of property and equipment 622 1,834 Proceeds from sale of business 8,544 — Terminated forward contract — 3,535 Net cash used in investing activities ( 66,554 ) ( 845,514 ) Cash flows from financing activities Termination of cash flow hedge — 21,252 Repurchase of common stock — ( 74,562 ) Proceeds from borrowing under lines of credit and term loan 264 716,721 Repayments of lines of credit and term loan ( 17,362 ) ( 27,816 ) Debt issuance costs — ( 6,804 ) Dividends paid ( 33,679 ) ( 32,819 ) Cash paid on behalf of employees for shares withheld ( 7,398 ) ( 9,523 ) Net cash provided by (used in) financing activities ( 58,175 ) 586,449 Effect of exchange rate changes on cash and cash equivalents ( 3,184 ) 3,776 Net increase in cash and cash equivalents 270,264 8,107 Cash and cash equivalents at beginning of period 300,742 301,155 Cash and cash equivalents at end of period $ 571,006 $ 309,262 Noncash activity during the period Noncash capital expenditures $ 4,150 $ 681 Dividends declared but not paid 11,518 11,223 Issuance of Company’s common stock for compensation — 960 The accompanying notes are an integral part of these condensed consolidated financial statements 8 Notes to Condensed Consolidated Financial Statements (Unaudited) 1. Basis of Presentation Principles of Consolidation The accompanying Condensed Consolidated Financial Statements include the accounts of Simpson Manufacturing Co., Inc. and its subsidiaries (collectively, the “Company”). Investments in 50% or less owned entities are accounted for using either the cost or the equity method. All significant intercompany transactions have been eliminated. Use of Estimates The preparation of the Condensed Consolidated Financial Statements in conformity with accounting principles generally accepted in the United States of America ("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Condensed Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. Management believes that these Condensed Consolidated Financial Statements include all normal and recurring adjustments necessary for a fair presentation under GAAP. Interim Reporting Period The accompanying unaudited quarterly Condensed Consolidated Financial Statements have been prepared in accordance with GAAP pursuant to the rules and regulations for reporting interim financial information and instructions on Form 10-Q. Accordingly, certain information and footnotes required by GAAP have been condensed or omitted. These interim statements should be read in conjunction with the audited consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022 (the “2022 Form 10-K”). The unaudited quarterly Condensed Consolidated Financial Statements have been prepared on the same basis as the audited consolidated financial statements and, in the opinion of management, contain all adjustments (consisting of only normal recurring adjustments) necessary to state fairly the financial information set forth therein in accordance with GAAP. The year-end Condensed Consolidated Balance Sheet data provided herein were derived from audited consolidated financial statements included in the 2022 Form 10-K, but do not include all disclosures required by GAAP. The Company’s quarterly results fluctuate. As a result, the Company believes the results of operations for the interim periods presented are not necessarily indicative of the results to be expected for any future periods. Revenue Recognition Generally, the Company's revenue contract with a customer exists when (1) the goods are shipped, services are rendered, and the related invoice is generated, (2) the duration of the contract does not extend beyond the promised goods or services already transferred and (3) the transaction price of each distinct promised product or service specified in the invoice is based on its relative stated standalone selling price. The Company recognizes revenue when it satisfies a performance obligation by transferring control of a product to a customer at a point in time. Our shipping terms provide the primary indicator of the transfer of control. The Company's general shipping terms are Incoterm C.P.T. (F.O.B. shipping point), where the title, and risk and rewards of ownership transfer at the point when the products are no longer on the Company's premises. Other Incoterms are allowed as exceptions depending on the product or service being sold and the nature of the sale. The Company recognizes revenue based on the consideration specified in the invoice with a customer, excluding any sales incentives, discounts, and amounts collected on behalf of third parties (i.e., governmental tax authorities). Based on historical experience with the customer, the customer's purchasing pattern, and its significant experience selling products, the Company concluded that a significant reversal in the cumulative amount of revenue recognized would not occur when the uncertainty (if any) is resolved (that is, when the total amount of purchases is known). Refer to Note 2 for additional information. 9 Net Income Per Common Share The Company calculates net income per common share based on the weighted-average number of shares of the Company's common stock outstanding during the period. Potentially dilutive securities are included in the diluted per-share calculations using the treasury stock method for all periods when the effect of their inclusion is dilutive. Accounting for Leases The Company has operating and finance leases for certain facilities, equipment, autos and data centers. As an accounting policy for short-term leases, the Company elected to not recognize a right-of-use ("ROU") asset and liability if, at the commencement date, the lease (1) has a term of 12 months or less and (2) does not include renewal and purchase options that the Company is reasonably certain to exercise. Monthly payments on short-term leases are recognized on a straight-line basis over the full lease term. Accounting for Stock-Based Compensation The Company recognizes stock-based compensation expense related to the estimated fair value of restricted stock awards on a straight-line basis, net of estimated forfeitures, over the requisite service period of the awards, which is generally the vesting term of three or four years . Stock-based expense related to performance share grants are measured based on grant date fair value and expensed on a graded basis over the service period of the awards, which is generally a performance period of three years . The performance conditions are based on the Company's achievement of revenue growth and return on invested capital over the performance period, and are evaluated for the probability of vesting at the end of each reporting period with changes in expected results recognized as an adjustment to expense. The assumptions used to calculate the fair value of restricted stock grants are evaluated and revised, as necessary, to reflect market conditions and the Company’s experience. Fair Value of Financial Instruments Fair value is an exit price representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between unrelated market participants. As such, fair value is a market-based measurement that is determined based on assumptions that unrelated market participants would use in pricing an asset or a liability. Assets and liabilities recorded at fair value are measured and classified under a three-tier fair valuation hierarchy based on the observability of the inputs available in the market: Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument; and Level 3 inputs are unobservable inputs based on the Company’s assumptions used to measure assets and liabilities at fair value. The fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The carrying amounts of trade accounts receivable, accounts payable, accrued liabilities and other current liabilities approximate fair value due to the short-term nature of these instruments. The fair values of the Company's interest rate and foreign currency contracts are classified as Level 2 within the fair value hierarchy. The fair values of the Company’s contingent consideration related to acquisitions and equity investments are classified as Level 3 within the fair value hierarchy, as these amounts are based on unobservable inputs developed using management's estimates and entity-specific assumptions, which reflect those that market participants would use, and are evaluated on an ongoing basis. 10 The following tables summarize financial assets and liabilities measured at fair value as of September 30, 2023 and 2022: 2023 2022 (in millions) Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Cash equivalents (1) $ 334.6 $ — $ — $ 31.9 $ — $ — Derivative instruments - assets (2) — 42.8 — — 82.1 — Derivative instruments - liabilities (2) — ( 9.5 ) — — — — Contingent considerations — — 5.4 — — — 1) The carrying amounts of cash equivalents, representing United States Treasury securities and money market funds traded in an active market with relatively short maturities, are reported on the consolidated balance sheet as of September 30, 2023 and 2022 as a component of "Cash and cash equivalents". (2) Derivatives for interest rate, foreign exchange and forward swap contracts are discussed in Note 8. The carrying amounts of the term loan and revolver approximate fair value as of September 30, 2023 based upon its terms and conditions in comparison to debt instruments with similar terms and conditions available on the same date. Derivative Instruments The Company uses derivative instruments as a risk management tool to mitigate the potential impact of certain market risks. Foreign currency and interest rate risk are the primary market risks the Company manages through the use of derivative instruments, which are accounted for as cash flow hedges or net investment hedges under the accounting standards and carried at fair value as other current or noncurrent assets or as other current or other long-term liabilities. Assets and liabilities with the legal right of offset have been netted. Net deferred gains and losses related to changes in fair value of cash flow hedges are included in accumulated other comprehensive income/loss ("OCI"), a component of stockholders' equity, and are reclassified into the line item in the Condensed Consolidated Statement of Earnings and Comprehensive Income in which the hedged items are recorded in the same period the hedged item affects earnings. The effective portion of gains and losses attributable to net investment hedges is recorded net of tax to OCI to offset the change in the carrying value of the net investment being hedged. Recognition in earnings of amounts previously recorded to OCI are limited to circumstances such as complete or substantially complete liquidation of the net investment in the hedged foreign operation. Changes in fair value of any derivatives that are determined to be ineffective are immediately reclassified from OCI into earnings. Cash and Cash Equivalents The Company classifies investments that are highly liquid and have maturities of three months or less at the date of purchase as cash equivalents. Current Estimated Credit Loss - Allowance for Doubtful Accounts The Company maintains an allowance for doubtful accounts receivable for estimated future expected credit losses resulting from customers' failure to make payments on its accounts receivable. The Company determines the estimate of the allowance for doubtful accounts receivable by considering several factors, including (1) specific information on the financial condition and the current creditworthiness of customers, (2) credit rating, (3) payment history and historical experience, (4) aging of the accounts receivable, (5) reasonable and supportable forecasts about collectability, and (6) current market and economic conditions, and expectations of the future market and economic conditions. The Company also reserves 100 % of the amounts deemed uncollectible due to a customer's deteriorating financial condition or bankruptcy. Every quarter, the Company evaluates the collectability based on customer group using the accounts receivable aging report and its best judgment when considering changes in customers' credit ratings, level of delinquency, customers' historical payments and loss experience, current market and economic conditions, and expectations of future market and economic conditions. The changes in the allowance for doubtful accounts receivable for the nine months ended September 30, 2023 are outlined in the table below: Balance at Balance at (in thousands) December 31, 2022 Expense (Deductions), net Write-Offs 1 September 30, 2023 Allowance for doubtful accounts $ 3,240 858 ( 197 ) $ 3,901 1 Amount is net of recoveries and the effect of foreign currency fluctuations. 11 Income Taxes Income taxes are calculated using an asset and liability approach. The provision for income taxes includes federal, state and foreign taxes currently payable, and deferred taxes arising from temporary differences between the financial statement and tax bases of assets and liabilities. In addition, future tax benefits are recognized to the extent that realization of such benefits is more likely than not. This method gives consideration to the future tax consequences of the deferred income tax items and immediately recognizes changes in income tax laws in the year of enactment. The Company uses an estimated annual tax rate to measure the tax benefit or tax expense recognized in each interim period. Prior years' income tax payable was separated in "Condensed Consolidated Balance Sheets" and "Condensed Consolidated Statements of Cash Flows" to conform to the 2023 presentation basis. The change had no effect on net income or stockholders' equity as previously reported. Accounting Standards Not Yet Adopted We believe that all recently issued accounting pronouncements from the Financial Accounting Standards Board ("FASB") do not apply to us or will not have a material impact to the Condensed Consolidated Financial Statements. 12 2. Revenue from Contracts with Customers Disaggregated Revenue The Company disaggregates net sales into the following major product groups as described in its segment information included in these interim financial statements under Note 14. Wood Construction Products Revenue . Wood construction products represented approximately 85 % and 87 % of total net sales for the nine months ended September 30, 2023 and 2022, respectively. Concrete Construction Products Revenue. Concrete construction products represented approximately 14 % and 13 % of total net sales for the nine months ended September 30, 2023 and 2022 respectively. Customer Acceptance Criteria. Generally, there are no customer acceptance criteria included in the Company's standard sales agreement with customers. When an arrangement with the customer does not meet the criteria to be accounted for as a revenue contract under the standard, the Company recognizes revenue in the amount of nonrefundable consideration received when the Company has transferred control of the goods or services and has stopped transferring (and has no obligation to transfer) additional goods or services. The Company offers certain customers discounts for paying invoices ahead of the due date, which are generally 30 to 60 days after the issue date. Other Revenue . Service sales, representing after-market repair and maintenance, engineering activities and software license sales and services were less than 0.5 % of total net sales and recognized as the services are completed or by transferring control over a product to a customer at a point in time. Services may be sold separately or in bundled packages. The typical contract length for a service is generally less than one year. For bundled packages, the Company accounts for individual services separately when they are distinct within the context of the contract. A distinct service is separately identifiable from other items in the bundled package if a customer can benefit from it on its own or with other resources that are readily available to the customer. The consideration (including any discounts) is allocated between separate services in a bundle based on their stand-alone selling prices. The stand-alone selling prices are determined based on the prices at which the Company separately sells the services. Reconciliation of contract balances Contract assets are the rights to consideration in exchange for goods or services that the Company has transferred to a customer when that right is conditional on something other than the passage of time. Contract liabilities are recorded for any services billed to customers and not yet recognizable if the contract period has commenced or for the amount collected from customers in advance of the contract period commencing. As of September 30, 2023, the Company had no contract assets or contract liabilities from contracts with customers . 3. Acquisition On April 1, 2022, the Company completed its acquisition (the "Acquisition") of 100 % of the outstanding equity interest of FIXCO Invest S.A.S. (together with its subsidiaries, "ETANCO") for total purchase consideration of $ 805.4 million, net of cash acquired. The Acquisition was completed pursuant to the securities purchase agreement dated January 26, 2022, as amended, by and among the Company, Fastco Investment, Fastco Financing, LRLUX and certain other security holders. The purchase price for the Acquisition was paid using cash on hand and borrowings in the amount of $ 250.0 million under the revolving credit facility and $ 450.0 million under the term loan facility. ETANCO is a manufacturer and distributor of fastener and fixing products headquartered in France and its primary product applications directly align with the addressable markets in which the Company operates. The Acquisition allows the Company to enter into new commercial building markets such as façades, waterproofing, safety and solar, as well as grow its share of direct business sales in Europe. ETANCO’s results of operations were included in the Company's Condensed Consolidated Financial Statements from April 1, 2022, the acquisition date. ETANCO had net sales of $ 67.5 million and net loss of $1.8 million, and net sales of $ 147.8 million and net loss of $ 3.7 million, for the three and nine months ended September 30, 2022, respectively, which includes costs related to the amortization of acquired intangible assets, and expenses incurred for integration. 13 Purchase price allocation The Acquisition was accounted for using the acquisition method of accounting in accordance with Accounting Standards Codification 805, Business Combinations ("ASC 805") which requires, among other things, that assets acquired and liabilities assumed in a business combination be recorded at fair value as of the acquisition date with limited exceptions. The allocation of the $ 824.4 million purchase price, including cash, to the fair values of the tangible and intangible assets acquired and liabilities assumed is as follows: (in thousands) Amount Cash and cash equivalents $ 19,010 Trade accounts receivable, net 63,607 Inventory 107,185 Other current assets 4,491 Property and equipment, net 89,695 Operating lease right-of-use assets 5,361 Goodwill 365,591 Intangible assets, net 357,327 Other noncurrent assets 2,881 Total assets 1,015,148 Trade accounts payable 46,457 Accrued liabilities and other current liabilities 22,079 Operating lease liabilities 5,176 Deferred income tax and other long-term liabilities 117,031 Total purchase price $ 824,405 Trade accounts receivable, net The gross amount of trade receivables acquired was approximately $ 67.4 million, of which $ 63.6 million was estimated to be recoverable based on ETANCO's historical trend for collections. Inventory Acquired inventory primarily consists of raw materials and finished goods consisting of building and construction materials products. The Company adjusted acquired finished goods higher by $ 12.8 million to estimated fair value based on expected selling prices less a reasonable amount for selling efforts. The fair value adjustment is recognized as a component of cost of sales over the inventory’s expected turnover period, and as a result, $ 2.9 million and $ 12.8 million of the adjustment was recognized during the three and nine months ended September 30, 2022, respectively. There were no such adjustments during the three and nine months ended September 30, 2023. Property and equipment, net Acquired property and equipment includes land of $ 22.3 million, buildings and site improvements of $ 29.4 million, and machinery, equipment, and software of $ 35.5 million. The estimated fair value of property and equipment was determined primarily using market and/or or cost approach methodologies. The acquired fair value for buildings and site improvements depreciate on a straight-line basis over the estimated useful lives of the assets for a period of up to sixteen years , machinery, equipment and software will depreciate on an accelerated basis over an estimated useful life of three to ten years . 14 Goodwill The excess of the purchase price over the net assets acquired was recognized as goodwill and relates to the value that is expected from the acquired assembled workforce as well as the increased scale and synergies resulting from the integration of both businesses. The goodwill recognized from the Acquisition is not deductible for local income tax purposes and has been allocated to components within the ETANCO reporting unit. Intangible assets, net The estimated fair value of intangible assets acquired was determined primarily using income approach methodologies. The values allocated to intangible assets and the useful lives were as follows: (in thousands, except useful lives) Weighted-average useful life (in years) Amount Customer relationships 15 $ 248,398 Trade names Indefinite 93,811 Developed technology 10 11,256 Patents 8 3,862 $ 357,327 The acquired definite-lived intangible assets are being amortized on a straight-line basis over estimated useful lives, which approximates the pattern in which these assets are utilized. Deferred taxes As a result of the increase in fair value of inventory, property and equipment, and intangible assets, deferred tax liabilities of $ 105.4 million were recognized, primarily due to intangible assets. Acquisition and integration related costs During the three and nine months ended September 30, 2022, the Company incurred acquisition and integration related expenses of $ 1.9 million and $ 14.7 million, respectively, for investment banking, legal, accounting, advisory, and consulting fees. These costs were included in the Company’s income from operations. 15 Unaudited pro forma results The following unaudited pro forma combined financial information presents estimated results as if the Company acquired ETANCO on January 1, 2021. The unaudited pro forma financial information as presented below is for informational purposes only and does not purport to actually represent what the Company’s combined results of operations would have been had the Acquisition occurred on January 1, 2021, or what those results will be for any future periods. The following unaudited pro forma consolidated financial information has been prepared using the acquisition method of accounting in accordance with U.S. GAAP: Three Months Ended September 30, Nine Months Ended September 30, (in thousands, except per share amounts) 2022 2022 Net sales $ 553,662 $ 1,719,648 Net income $ 92,327 $ 302,579 Pro forma earnings per common share: Basic $ 2.16 $ 7.03 Diluted $ 2.15 $ 7.01 Weighted average shares outstanding: Basic 42,813 43,044 Diluted 42,916 43,173 The unaudited pro forma results above includes the following adjustments to net income: 1) Acquisition and integration related costs of $ 1.9 million and $ 14.7 million and which were incurred during the three and nine months ended September 30, 2022, respectively, were adjusted as if such costs were incurred during the twelve months ended December 31, 2021. 2) The $ 2.9 million and $ 12.8 million of amortization related to the fair value adjustment for inventory and recognized during the three and nine months ended September 30, 2022, respectively, were adjusted as if incurred during the nine months ended September 30, 2021. 3) Net income for ETANCO includes adjustments of $ 0.6 million and $ 2.7 million to conform ETANCO’s historical financial results prepared under French GAAP to U.S. GAAP for the three and nine months ended September 30, 2021, respectively. The U.S. GAAP adjustments are primarily related to share-based payments expense on awards that were settled prior to the Acquisition, and costs incurred and capitalized by ETANCO on its historical acquisitions. 16 4. Net Income per Share The following shows a reconciliation of basic net earnings per share ("EPS") to diluted EPS: Three Months Ended September 30, Nine Months Ended September 30, (in thousands, except per share amounts) 2023 2022 2023 2022 Net income available to common stockholders $ 104,021 $ 88,243 $ 299,185 $ 276,389 Basic weighted-average shares outstanding 42,673 42,813 42,651 43,044 Dilutive effect of potential common stock equivalents — restricted stock units 209 103 242 129 Diluted weighted-average shares outstanding 42,882 42,916 42,893 43,173 Net earnings per common share: Basic $ 2.44 $ 2.06 $ 7.01 $ 6.42 Diluted $ 2.43 $ 2.06 $ 6.98 $ 6.40 5. Stock-Based Compensation The Company allocates stock-based compensation expense amongst cost of sales, research and development and other engineering expense, selling expense, or general and administrative expense based on the job functions performed by the employees to whom the stock-based compensation is awarded. Stock-based compensation capitalized in inventory was immaterial for all periods presented. The Company recognized stock-based compensation expense related to its equity plans for employees of $ 6.6 million and $ 3.5 million for the three months ended September 30, 2023 and 2022, respectively, and $ 17.8 million and $ 13.0 million for the nine months ended September 30, 2023 and 2022, respectively. During the nine months ended September 30, 2023, the Company granted an aggregate of 277,793 restricted stock units (RSUs) and performance stock units (PSUs) to the Company's employees, including officers at an estimated weighted average fair value of $ 99.66 per share based on the closing price (adjusted for the present value of dividends) of the Company's common stock on the grant date. The RSUs and PSUs granted to the Company's employees may be time-based or time and performance-based. Certain of the PSUs are granted to officers and key employees, where the number of performance-based awards to be issued is based on the achievement of certain Company performance criteria established in the award agreement over a cumulative three year period, after which time these awards cliff vest. In addition, these same officers and key employees also receive time-based RSUs, which vest pursuant to a three-year graded vesting schedule. Time-based RSUs that are granted to the Company's employees excluding officers and certain key employees, vest ratably over the four year vesting-term of the award. The Company’s nine non-employee directors are entitled to receive an aggregate of approximately $ 1.1 million in equity compensation annually. The number of shares ultimately granted are based on the average closing share price for the Company over the 60 day period prior to approval of the award in the second quarter of each year. In April 2023 and June 2023, the Company granted 9,776 shares of the Company's common stock to the non-employee directors, based on the average closing price of $ 122.50 per share and recognized $ 1.2 million of expense. As of September 30, 2023, the Company's aggregate unamortized stock compensation expense was approximately $ 27.2 million which is expected to be recognized in expense over a weighted-average period of 2.3 years. 17 6. Trade Accounts Receivable, net Trade accounts receivable consisted of the following: As of September 30, As of December 31, (in thousands) 2023 2022 2022 Trade accounts receivable $ 360,233 $ 341,293 $ 276,229 Allowance for doubtful accounts ( 3,901 ) ( 2,864 ) ( 3,240 ) Allowance for sales discounts and returns ( 5,168 ) ( 3,980 ) ( 3,865 ) $ 351,164 $ 334,449 $ 269,124 7. Inventories The components of inventories are as follows: As of September 30, As of December 31, (in thousands) 2023 2022 2022 Raw materials $ 144,268 $ 189,715 $ 187,149 In-process products 52,633 48,627 55,171 Finished products 307,545 301,678 314,481 $ 504,446 $ 540,020 $ 556,801 18 8. Derivative Instruments The Company enters into derivative instrument agreements, including forward foreign currency exchange contracts, interest rate swaps, and cross currency swaps to manage risk in connection with changes in foreign currency and interest rates. The Company hedges committed exposures and does not engage in speculative transactions. The Company only enters into derivative instrument agreements with counterparties who have highly rated credit. As of September 30, 2023, the aggregate notional amount of the Company's outstanding interest rate contracts, cross currency swap contracts, EUR forward contract and CNY forward contracts were $ 566.3 million, $ 436.4 million, $ 321.7 million and $ 4.6 million (CNY 31.7 million), respectively. Changes in fair value of any forward contracts that are determined to be ineffective are immediately reclassified from OCI into earnings. There were no amounts recognized due to ineffectiveness during the three and nine months ended September 30, 2023 and September 30, 2022. The effects of fair value and cash flow hedge accounting on the Condensed Consolidated Statement of Earnings and Comprehensive Income for the nine months ended September 30, were as follows: 2023 2022 (in thousands) Cost of sales Interest income (expense), net and other finance costs Other & foreign exchange loss, net Cost of sales Interest income (expense), net and other finance costs Other & foreign exchange loss, net Total amounts of income and expense line items presented in the Condensed Consolidated Statement of Earnings in which the effects of fair value or cash flow hedges are recorded $ 888,835 18 $ ( 1,471 ) 899,828 ( 6,568 ) ( 3,814 ) The effects of fair value and cash flow hedging Gain or (loss) on cash flow hedging relationships Interest contracts: Amount of gain or (loss) reclassified from OCI to earnings — 11,409 — — ( 3,315 ) — Cross currency swap contract Amount of gain or (loss) reclassified from OCI to earnings — 4,088 6,508 — ( 4,020 ) 57,560 Forward contract Amount of gain reclassified from OCI to earnings 60 — — 163 — — The effects of derivative instruments on the Condensed Consolidated Statement of Earnings and Comprehensive Income for the three months ended September 30, 2023 and 2022 were as follows: 19 Cash Flow Hedging Relationships Gain (Loss) Recognized in OCI Location of Gain (Loss) Reclassified from OCI into Earnings Gain (Loss) Reclassified from OCI into Earnings (in thousands) 2023 2022 2023 2022 Interest rate contracts $ 4,959 $ 18,696 Interest expense $ 4,302 $ ( 337 ) Cross currency contracts 12,156 23,977 Interest expense 1,483 ( 5,979 ) Forward contracts ( 122 ) — FX gain (loss) 11,753 28,437 Cost of goods sold ( 20 ) — Total $ 16,993 $ 42,673 $ 17,518 $ 22,121 The effects of derivative instruments on the Condensed Consolidated Statement of Earnings and Comprehensive Income for the nine months ended September 30, 2023 and 2022 were as follows: Cash Flow Hedging Relationships Gain (Loss) Recognized in OCI Location of Gain (Loss) Reclassified from OCI into Earnings Gain (Loss) Reclassified from OCI into Earnings (in thousands) 2023 2022 2023 2022 Interest rate contracts $ 11,505 $ 25,571 Interest expense $ 11,409 $ ( 3,315 ) Cross currency contracts 4,137 46,692 Interest expense 4,088 ( 4,020 ) Forward contracts ( 535 ) — FX gain (loss) 6,508 57,560 Cost of goods sold 60 163 Total $ 15,107 $ 72,263 $ 22,065 $ 50,388 For the three months ending September 30, 2023 and September 30, 2022 gains on the net investment hedge of $ 3.2 million and $ 16.9 million were included in OCI, respectively. For the three months ending September 30, 2023 and September 30, 2022, excluded gains of $ 1.3 million and $ 1.3 million were reclassified from OCI to interest expense, respectively. For the nine months ending September 30, 2023 losses on the net investment hedge, and September 30, 2022 gains on the net investment hedge of $ 1.1 million and $ 28.2 million were included in OCI, respectively. For the nine months ending September 30, 2023 and September 30, 2022, excluded gains of $ 3.8 million and $ 2.4 million were reclassified from OCI to interest expense, respectively. As of September 30, 2023, the aggregate fair values of the Company’s derivative instruments on the Condensed Consolidated Balance Sheet were comprised of an asset of $ 42.8 million, of which $ 19.5 million is included in other current assets, and the balance of $ 23.3 million as other non-current assets, and of a non-current liability of $ 9.5 million included as deferred income tax and other long-term liabilities. 9. Property, Plant and Equipment, net Property, plant and equipment consisted of the following: As of September 30, As of December 31, (in thousands) 2023 2022 2022 Land $ 50,995 $ 48,027 $ 50,025 Buildings and site improvements 233,694 220,684 233,123 Leasehold improvements 7,690 5,698 6,367 Machinery, equipment, and software 496,999 449,121 472,907 789,378 723,530 762,422 Less accumulated depreciation and amortization ( 460,625 ) ( 419,108 ) ( 432,392 ) 328,753 304,422 330,030 Capital projects in progress 53,755 36,811 31,525 Total $ 382,508 $ 341,233 $ 361,555 20 10. Goodwill and Intangible Assets, net Goodwill consisted of the following: As of September 30, As of December 31, (in thousands) 2023 2022 2022 North America $ 101,487 $ 96,087 $ 103,572 Europe 380,699 370,669 390,799 Asia/Pacific 1,227 1,234 1,301 Total $ 483,413 $ 467,990 $ 495,672 I ntangible assets, net, consisted of the following: As of September 30, 2023 Gross Net Carrying Accumulated Carrying (in thousands) Amount Amortization Amount North America $ 64,189 $ ( 32,876 ) $ 31,313 Europe 369,827 ( 48,510 ) 321,317 Asia/Pacific 4,025 ( 205 ) 3,820 Total $ 438,041 $ ( 81,591 ) $ 356,450 As of September 30, 2022 Gross Net (in thousands) Carrying Amount Accumulated Amortization Carrying Amount North America $ 46,717 $ ( 28,922 ) $ 17,795 Europe 342,407 ( 29,669 ) 312,738 Total $ 389,124 $ ( 58,591 ) $ 330,533 As of December 31, 2022 Gross Net (in thousands) Carrying Amount Accumulated Amortization Carrying Amount North America $ 53,498 $ ( 29,782 ) $ 23,716 Europe 373,538 ( 34,337 ) 339,201 Total $ 427,036 $ ( 64,119 ) $ 362,917 Intangible assets consist of definite-lived and indefinite-lived assets. Definite-lived intangible assets include customer relationships, patents, unpatented technology, and non-compete agreements. Amortization of definite-lived intangible assets was $ 5.9 million and $ 5.4 million for the three months ended September 30, 2023 and 2022, respectively, and was $ 17.5 million and $ 11.8 million for the nine months ended September 30, 2023 and 2022, respectively. The weighted-average amortization period for all amortizable intangibles on a combined basis is 8.7 years. Indefinite-lived intangible assets totaled $ 90.4 million, $ 83.4 million, and $ 91.7 million as of September 30, 2023, and 2022 and December 31, 2022, respectively. 21 At September 30, 2023, the estimated future amortization of definite-lived intangible assets was as follows: (in thousands) Remaining three months of 2023 $ 5,699 2024 22,303 2025 22,086 2026 21,967 2027 21,774 2028 21,515 Thereafter 150,674 $ 266,018 The changes in the carrying amount of goodwill and intangible assets for the nine months ended September 30, 2023, were as follows: Intangible (in thousands) Goodwill Assets Balance at December 31, 2022 $ 495,672 $ 362,917 Acquisition 1 ( 2,077 ) 14,916 Disposal ( 5,678 ) — Amortization — ( 17,517 ) Foreign exchange ( 4,504 ) ( 3,866 ) Balance at September 30, 2023 $ 483,413 $ 356,450 1 During the quarter ended September 30, 2023, the Company finalized a business acquisition that resulted in $ 2.1 million decrease in goodwill with $ 0.9 million reclassified to intangible asset, and a corresponding decrease of $ 1.2 million in a contingent consideration liability. 22 11. Leases The Company has operating leases for certain facilities, equipment and automobiles. The existing operating leases expire at various dates through 2027, some of which include options to extend the leases for up to five years . The Company measured the lease liability at the present value of the lease payments to be made over the lease term. The lease payments are discounted using the Company's incremental borrowing rate. The Company measured the ROU assets at the amount at which the lease liability is recognized plus initial direct costs incurred or prepayment amounts. The ROU assets are amortized on a straight-line basis over the lease term. The following table provides a summary of leases included on the Condensed Consolidated Balance Sheets as of September 30, 2023 and 2022 and December 31, 2022, Condensed Consolidated Statements of Earnings and Comprehensive Income, and Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2023 and 2022: Condensed Consolidated Balance Sheets Line Item September 30, December 31, (in thousands) 2023 2022 2022 Operating leases Assets Operating leases Operating lease right-of-use assets $ 66,144 $ 48,196 $ 57,652 Liabilities Operating - current Accrued expenses and other current liabilities $ 13,617 $ 10,163 $ 11,544 Operating - noncurrent Operating lease liabilities 53,808 38,650 46,882 Total operating lease liabilities $ 67,425 $ 48,813 $ 58,426 Finance leases Assets Property and equipment, gross Property, plant and equipment, net $ — $ 3,569 $ 3,569 Accumulated amortization Property, plant and equipment, net — ( 3,569 ) ( 3,569 ) Property and equipment, net Property, plant and equipment, net $ — $ — $ — The components of lease expense were as follows: Condensed Consolidated Statements of Earnings and Comprehensive Income Line Item Three Months Ended September 30, (in thousands) 2023 2022 Operating lease cost General administrative expenses and cost of sales $ 4,434 $ 3,436 23 Other Information Supplemental cash flow information related to leases is as follows: Three Months Ended September 30, (in thousands) 2023 2022 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases $ 4,166 $ 3,435 Operating right-of-use assets obtained in exchange for lease obligations during the current period 6,437 3,159 The following is a schedule, by years, of maturities of lease liabilities as of September 30, 2023: (in thousands) Operating Leases Remaining three months of 2023 $ 4,279 2024 16,032 2025 14,294 2026 11,697 2027 9,148 2028 8,663 Thereafter 13,917 Total lease payments 78,030 Less: Present value discount ( 10,605 ) Total lease liabilities $ 67,425 The following table summarizes the Company's lease terms and discount rates as of September 30, 2023 and 2022: Weighted-average remaining lease terms (in years): 2023 2022 Operating leases 5.8 6.1 Weighted-average discount rate: Operating leases 4.8 % 4.8 % 12. Debt As of September 30, 2023, the Company had $ 566.3 million, excluding deferred financing costs, outstanding under its Amended and Restated Credit Facility. The Company had outstanding balances of $ 688.8 million and $ 583.2 million under the Amended and Restated Credit Facility as of September 30, 2022, and December 31, 2022, respectively. The following is a schedule, by years, of maturities for the remaining term loan facility as of September 30, 2023: 24 (in thousands) 5-Year Term Loan Remaining three months of 2023 $ 5,625 2024 22,500 2025 22,500 2026 22,500 2027 343,125 Total loan outstanding $ 416,250 The $ 150.0 million outstanding under the revolving credit facility is due on March 31, 2027. The Company was in compliance with its financial covenants under the Amended and Restated Credit Facility as of September 30, 2023. Certain of the Company's domestic subsidiaries are guarantors for a credit agreement between certain of its foreign subsidiaries and institutional lenders that is in addition to the Amended and Restated Credit Facility. As of September 30, 2023, all of the Company's credit facilities provide a total of $ 306.5 million in available borrowing capacity and an irrevocable standby letter of credit in support of various insurance deductibles. 13. Commitments and Contingencies Environmental The Company’s policy with regard to environmental liabilities is to accrue for future environmental assessments and remediation costs when information becomes available that indicates that it is probable that the Company is liable for any related claims and assessments and the amount of the liability is reasonably estimable. The Company does not believe that any such matters will have a material adverse effect on the Company’s financial condition, cash flows or results of operations. Litigation and Potential Claims The Company is subject to various legal and regulatory proceedings relating to contract disputes, personal injury, property damage, employment, product liability, environmental, intellectual property and other matters from time to time in the ordinary course of business (“Proceedings”). The Company accrues a liability for Proceedings when payments associated with the claims become probable and the costs can be reasonably estimated. The Company also considers whether an insurance recovery receivable is applicable and appropriate based on the specific Proceeding. Because Proceedings are inherently uncertain, we are unable to predict the ultimate outcome of Proceedings, or amount of liability, if any, and the actual costs of resolving Proceedings may be substantially higher or lower than the amounts accrued for those activities. However, management believes that the outcome of any Proceedings that are pending or threatened, either individually or in the aggregate, or on a combined basis, will not have a material adverse impact on the Company’s results of operations, financial position or liquidity. 14. Segment Information The Company is organized into three reporting segments defined by the regions where the Company’s products are manufactured, marketed and distributed to its customers. The three reporting segments are the North America segment (comprised primarily of the Company’s operations in the U.S. and Canada), the Europe segment, which includes ETANCO, and the Asia/Pacific segment (comprised of the Company’s operations in Asia and the South Pacific). These segments are similar in several ways, including the types of materials used, the production processes, the distribution channels and the product applications. The Administrative & All Other line item primarily includes expenses such as self-insured workers compensation claims for employees, stock-based compensation for certain members of management, interest expense, foreign exchange gains or losses and income tax expense, as well as revenues and expenses related to real estate activities. 25 The following tables illustrate certain measurements used by management to assess the performance of its reportable segments as of or the following periods: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2023 2022 2023 2022 Net Sales North America $ 456,820 $ 437,770 $ 1,328,615 $ 1,332,911 Europe 119,043 111,903 371,074 296,592 Asia/Pacific 4,221 3,989 12,404 10,961 Total $ 580,084 $ 553,662 $ 1,712,093 $ 1,640,464 Sales to Other Segments* North America $ 1,064 $ 1,071 $ 3,756 $ 3,646 Europe 1,327 1,045 4,399 4,000 Asia/Pacific 8,022 8,736 21,880 25,242 Total $ 10,413 $ 10,852 $ 30,035 $ 32,888 Income (Loss) from Operations North America $ 135,633 $ 127,318 $ 393,456 $ 400,336 Europe 15,450 6,149 42,894 10,339 Asia/Pacific 477 234 718 898 Administrative and all other ( 11,347 ) ( 10,886 ) ( 33,472 ) ( 31,243 ) Total $ 140,213 $ 122,815 $ 403,596 $ 380,330 * Sales to other segments are eliminated in consolidation. At As of September 30, December 31, (in thousands) 2023 2022 2022 Total Assets North America $ 1,675,344 $ 1,311,102 $ 1,393,968 Europe 687,992 641,988 675,634 Asia/Pacific 36,416 34,333 34,599 Administrative and all other 415,735 516,835 399,770 Total $ 2,815,487 $ 2,504,258 $ 2,503,971 Cash collected by the Company’s U.S. subsidiaries is routinely transferred into the Company’s cash management accounts and, therefore is in the total assets of “Administrative and all other.” Cash and cash equivalent balances in the “Administrative and all other” segment were $ 465.3 million, $ 236.3 million, and $ 222.5 million, as of September 30, 2023 and 2022, and December 31, 2022, respectively. Also included in the total assets of "Administrative and all other" are intercompany borrowings due from the Europe segment. Included in the total assets of each segment are net intercompany borrowings due to and from the other segments. The Company’s wood construction products include connectors, truss plates, fastening systems, fasteners and pre-fabricated shearwalls that are used for connecting and strengthening wood-based construction primarily in residential and commercial construction. Its concrete construction products include adhesives, specialty chemicals, mechanical anchors, carbide drill bits, powder actuated tools and reinforcing fiber materials that are used for restoration, protection or strengthening concrete, masonry and steel construction in residential, industrial, commercial and infrastructure construction. The table below illustrates the distribution of the Company’s sales by product group as additional information for the following periods: 26 Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2023 2022 2023 2022 Wood construction products $ 491,308 $ 478,554 $ 1,461,442 $ 1,428,745 Concrete construction products 84,141 74,933 242,133 211,119 Other 4,635 175 8,518 600 Total $ 580,084 $ 553,662 $ 1,712,093 $ 1,640,464 15. Subsequent Events Share Repurchases From October 1, 2023 to November 6, 2023, the Company repurchased an additional 333,469 shares of the Company’s common stock in the open market at an average price of $ 138.09 per share, for a total of $ 46.1 million. As a res ult, as of November 6, 2023, approximately $ 53.9 million remained available for share repurchase through December 31, 2023 under the Company’s previously announced $ 100.0 million share repurchase authorization. Dividend Declared On October 19, 2023, the Company’s Board of Directors (the "Board") declared a quarterly cash dividend of $ 0.27 per share, estimated to be $ 11.4 million in total. The dividend will be payable on January 25, 2024, to the Company's stockholders of record on January 4, 2024. Share Repurchase Authorization On October 19, 2023, the Board authorized the Company to repurchase up to $ 100.0 million of the Company's common stock, effective January 1, 2024 through December 31, 2024. 27