What changed in this filing

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Item 5. Market for Registrant’s Common Equity

2022-02-28 compared with 2021-02-22 · 3 added, 79 removed, 40 unchanged (67% of the section changed)

2 unchanged sentences

Our common stock has been listed on the New York Stock Exchange (NYSE) since April 8, 1999.

Between April 8, 1999 and November 22, 2009, it was listed under the symbol “TWP”.

Effective November 23, 2009, the symbol changed to “TREX”.

Effective November 23, 2009, our common stock is listed under the symbol “TREX”.

Dividend Policy

25 unchanged sentences

The Stock Repurchase Program was publicly announced on February 21, 2018.

The Company repurchased 232,385 shares of its common stock under the Stock Repurchase Program during the three months ended December 31, 2021.

Stockholder Return Performance Graph

7 unchanged sentences

Other Stockholder Matters

As of January 29, 2021, there were approximately 146 holders of record of our common stock, although we believe that there are a significantly larger number of beneficial owners of our common stock.

As of February 4, 2022, there were approximately 139 holders of record of our common stock, although we believe that there are a significantly larger number of beneficial owners of our common stock.

In 2021, we submitted to the NYSE in a timely manner the annual certification that our Chief Executive Officer was not aware of any violation by us of the NYSE corporate governance listing standards.

Selected Financial Data

The following table presents selected financial data as of December 31, 2020, 2019, 2018, 2017 and 2016 and for each year in the five-year period ended December 31, 2020.

The selected financial data should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our Consolidated Financial Statements and related notes thereto appearing elsewhere in this report.

Year Ended December 31, (1)

(In thousands, except share and per share data)

Statement of Comprehensive Income Data:

Cost of sales

Selling, general and administrative expenses

Income from operations

Interest (income) expense, net

Income before income taxes

Provision for income taxes

Basic earnings per share

Basic weighted average shares outstanding

Diluted earnings per share

Diluted weighted average shares outstanding

Cash Flow Data:

Cash provided by operating activities

Cash used in investing activities

Cash used in financing activities

EBITDA (non-GAAP)

Balance Sheet Data:

Cash and cash equivalents

Working capital

Total stockholders’ equity

All common stock share and per share data in the above table are presented on a post-split basis to reflect the two-for-one

stock split of our common stock in the form of a stock dividend distributed on September 14, 2020 to stockholders of record at the close of business on August 19, 2020.

On January 1, 2019, the Company adopted Financial Accounting Standards Board (FASB) Accounting Standards Update (ASU) No.

“ Leases (Topic 842),

” and subsequent amendments to the initial guidance within ASU Nos.

(collectively, the standard).

The standard requires lessees to recognize operating leases on the balance sheet as a right-of-use

(ROU) asset and a lease liability (current and non-current).

The liability is equal to the present value of the lease

payments over the remaining lease term.

The asset is based on the liability, subject to certain adjustments.

The Company elected the modified retrospective method of adoption, which allowed the Company to apply the standard as of the beginning of the period of adoption.

As a result, at December 31, 2019 the Company reported an ROU asset in total assets and included the current portion of the lease liability in working capital.

On July 31, 2017, the Company’s newly-formed, wholly-owned subsidiary, Trex Commercial Products, Inc.

acquired certain assets and assumed certain liabilities of Staging Concepts Acquisition, LLC.

The Consolidated Financial Statements include the accounts of Trex Commercial Products, Inc.

from the date of acquisition.

Also, the tax legislation H.R.1, “An Act to Provide for Reconciliation Pursuant to Titles II and V of the Concurrent Resolution on the Budget for Fiscal Year 2018,” known as the Tax Cuts and Jobs Act (Act), was enacted on December 22, 2017.

Accordingly, we have recognized the tax effects of the Act in our financial statements and related notes as of and for the year ended December 31, 2017.

Deferred tax assets that existed as of the enactment date and that reversed after the Act’s effective date of January 1, 2018 were adjusted to reflect the new Federal statutory tax rate of 21%.

The effect of the change in tax rate on the deferred tax assets was allocated to continuing operations as a discrete item.

We finalized our analysis of the Act in 2018, which did not give rise to new deferred tax amounts.

Year ended December 31, 2016 was materially affected by a pre-tax

increase of $9.8 million to the warranty reserve related to surface flaking.

Also, during 2016, the Company adopted FASB ASU No.

“ Income Taxes (Topic 740):

Balance Sheet Classification of Deferred Taxes.

EBITDA represents net income before interest, income taxes, depreciation and amortization.

EBITDA is not a measurement of financial performance under accounting principles generally accepted in the United States (GAAP).

The Company has included data with respect to EBITDA because management evaluates and projects the performance of the Company’s business using several measures, including EBITDA.

Management considers EBITDA to be an important supplemental indicator of the Company’s operating performance, particularly as compared to the operating performance of the Company’s competitors, because this measure eliminates many differences among companies in capitalization and tax structures, capital investment cycles and ages of related assets, as well as some recurring non-cash

and non-operating

charges to net income or loss.

For these reasons, management believes that EBITDA provides important supplemental information to investors regarding the operating performance of the Company and facilitates comparisons by investors between the operating performance of the Company and the operating performance of its competitors.

Management believes that consideration of EBITDA should be supplemental, because EBITDA has limitations as an analytical financial measure.

These limitations include the following:

EBITDA does not reflect the Company’s cash expenditures, or future requirements for capital expenditures, or contractual commitments;

EBITDA does not reflect the interest expense, or the cash requirements necessary to service interest or principal payments, on the Company’s indebtedness;

Although depreciation and amortization are non-cash

charges, the assets being depreciated and amortized will often have to be replaced in the future, and EBITDA does not reflect any cash requirements for such replacements;

EBITDA does not reflect the effect of earnings or charges resulting from matters the Company considers not to be indicative of its ongoing operations;

Not all entities in the Company’s industry may calculate EBITDA in the same manner in which the Company calculates EBITDA, which limits its usefulness as a comparative measure.

The Company compensates for these limitations by relying primarily on its GAAP results to evaluate its operating performance and by considering independently the economic effects of the foregoing items that are not reflected in EBITDA.

As a result of these limitations, EBITDA should not be considered as an alternative to net income, as calculated in accordance with GAAP, as a measure of operating performance, nor should it be considered as an alternative to cash flows as a measure of liquidity.

The following table sets forth, for the years indicated, a reconciliation of EBITDA to net income:

Year Ended December 31,

(In thousands)

Interest (income) expense, net

Income tax provision

Depreciation and amortization

EBITDA (non-GAAP)

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 5. Market for Registrant’s Common Equity