Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter)during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes☑ No☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑ .

The number of shares outstanding of the issuer’s common stock, without par value, as of July ~~31, 2019~~24, 2020 was ~~35,493,582~~35,794,830 shares.

	For the Quarter Ended June 30,					For the Six Months Ended June 30,						For the Quarter Ended June 30,					For the Six Months Ended June 30,
	2019			2018		2019			2018			2020		2019			2020			2019
Net sales	$	134,285		$	140,560	$	273,400		$	293,128		$	118,394	$	134,285		$	240,644		$	273,400
Cost of sales		87,349			92,569		180,905			198,022			75,821		87,349			155,588			180,905
Gross profit		46,936			47,991		92,495			95,106			42,573		46,936			85,056			92,495
Selling, general and administrative expenses		36,809			34,506		71,277			69,979			30,317		36,809			61,433			71,277
(Gain) loss on disposal of fixed assets		(55	)		66		(98	)		(314	)
Gain on disposal of fixed assets													—		(55	)		(7	)		(98	)
Impairment charges		—			308		916			308			—		—			—			916
Gain on sale of notes receivable													—		—			(11,924	)		—
Operating income		10,182			13,111		20,400			25,133			12,256		10,182			35,554			20,400
Interest expense, net		1,017			1,313		2,066			2,952			1,194		1,017			2,263			2,066
Income from continuing operations before income taxes		9,165			11,798		18,334			22,181			11,062		9,165			33,291			18,334
Income tax expense		2,559			3,190		5,085			5,818			2,694		2,559			8,197			5,085
Income from continuing operations		6,606			8,608		13,249			16,363			8,368		6,606			25,094			13,249
Income (loss) from discontinued operations, net of income tax		—			—		127			(911	)
Income from discontinued operations, net of income tax													—		—			—			127
Net income	$	6,606		$	8,608	$	13,376		$	15,452		$	8,368	$	6,606		$	25,094		$	13,376
Income per common share from continuing operations:
Basic	$	0.19		$	0.26	$	0.37		$	0.52		$	0.23	$	0.19		$	0.70		$	0.37
Diluted	$	0.18		$	0.26	$	0.37		$	0.51		$	0.23	$	0.18		$	0.70		$	0.37
Income (loss) per common share from discontinued operations:
Basic	$	—		$	—	$	—		$	(0.03	)	$	—	$	—		$	—		$	—
Diluted	$	—		$	—	$	—		$	(0.03	)	$	—	$	—		$	—		$	—
Net income per common share:
Basic	$	0.19		$	0.26	$	0.37		$	0.49		$	0.23	$	0.19		$	0.70		$	0.37
Diluted	$	0.18		$	0.26	$	0.37		$	0.48		$	0.23	$	0.18		$	0.70		$	0.37

~~Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited)~~

	June 30,			December 31,			June 30,			December 31,
	2019			2018			2020			2019
Assets
Current Assets
Cash	$	75,205		$	58,894		$	72,322		$	75,527
Accounts receivable, less allowances of $1,947 and $2,259, respectively		73,120			72,939
Accounts receivable, less allowances of $2,542 and $1,945, respectively								71,270			62,279
Income tax receivable		—			4,892			—			142
Inventories, net		42,341			43,596			49,551			44,260
Prepaid expenses and other current assets		4,600			2,534			5,746			2,834
Total Current Assets		195,266			182,855			198,889			185,042
Other Assets
Property, plant, and equipment, net		57,216			65,460			54,328			54,964
Right of use asset - operating leases		5,983			—			4,801			5,901
Goodwill		59,505			59,068			66,202			66,774
Intangible assets, net		26,583			30,280			26,366			30,754
Deferred income taxes		6,490			5,270			856			5,807
Other		1,953			5,712			3,403			3,897
Total Assets	$	352,996		$	348,645		$	354,845		$	353,139

Liabilities and Shareholders’ Equity
Current Liabilities
Accounts payable	$	52,827		$	60,849		$	44,857		$	46,867
Accrued expenses
Employee compensation		12,859			16,531
Income taxes		1,182			—
Taxes, other than income taxes		1,273			1,403
Accrued employee compensation								10,424			12,488
Income taxes payable								2,834			—
Accrued taxes payable, other than income taxes								1,315			1,104
Accrued interest		1,785			1,939			1,785			1,785
Other current liabilities		14,639			16,701			17,726			18,324
Operating lease liability - short-term		2,000			—			1,546			2,057
Long-term debt - current portion								39,956			—
Total Current Liabilities		86,565			97,423			120,443			82,625
Long-term debt		76,983			76,790			37,420			77,176
Operating lease liability - long-term		4,225			—			3,478			4,074
Other liabilities		22,813			19,794			11,809			22,582
Shareholders’ Equity
Serial Preferred Shares (authorized 1,000,000 shares; none issued and outstanding)		—			—
Common Shares, without par value (authorized 60,000,000 shares; outstanding 35,484,312 and 35,374,121; net of treasury shares of 7,068,145 and 7,178,336, respectively)		21,646			21,547
Serial Preferred Shares (authorized 1,000,000 shares;NaN issued and outstanding)								—			—
Common Shares, without par value (authorized 60,000,000 shares; outstanding 35,784,525 and 35,710,934; net of treasury shares of 6,767,932 and 6,841,523, respectively)								21,845			21,785
Additional paid-in capital		294,066			292,558			297,522			296,363
Accumulated other comprehensive loss		(16,745	)		(18,280	)		(17,884	)		(16,349	)
Retained deficit		(136,557	)		(141,187	)		(119,788	)		(135,117	)
Total Shareholders’ Equity		162,410			154,638			181,695			166,682
Total Liabilities and Shareholders’ Equity	$	352,996		$	348,645		$	354,845		$	353,139

														Quarter Ended June 30, 2020
														Common Shares		Additional Paid-In Capital		Accumulated Other Comprehensive Income (Loss)			Retained Deficit			Total Shareholders' Equity
Balance at April 1, 2020														$	21,828	$	296,736	$	(19,104	)	$	(123,237	)	$	176,223
Net income															—		—		—			8,368			8,368
Foreign currency translation adjustment															—		—		1,220			—			1,220
Shares issued under incentive plans, net of shares withheld for tax															17		93		—			—			110
Stock compensation expense															—		693		—			—			693
Declared dividends - $0.135 per share															—		—		—			(4,919	)		(4,919	)
Balance at June 30, 2020														$	21,845	$	297,522	$	(17,884	)	$	(119,788	)	$	181,695

	Quarter Ended June 30, 2019													Quarter Ended June 30, 2019
	Common Shares		Additional Paid-In Capital		Accumulated Other Comprehensive Income (Loss)			Retained Deficit			Total Shareholders' Equity			Common Shares		Additional Paid-In Capital		Accumulated Other Comprehensive Income (Loss)			Retained Deficit			Total Shareholders' Equity
Balance at April 1, 2019	$	21,627	$	292,608	$	(17,503	)	$	(138,306	)	$	158,426		$	21,627	$	292,608	$	(17,503	)	$	(138,306	)	$	158,426
Net income		—		—		—			6,606			6,606			—		—		—			6,606			6,606
Foreign currency translation adjustment		—		—		758			—			758			—		—		758			—			758
Shares issued under incentive plans, net of shares withheld for tax		19		196		—			—			215			19		196		—			—			215
Stock compensation expense		—		1,262		—			—			1,262			—		1,262		—			—			1,262
Declared dividends - $0.14 per share		—		—		—			(4,857	)		(4,857	)
Declared dividends - $0.135 per share															—		—		—			(4,857	)		(4,857	)
Balance at June 30, 2019	$	21,646	$	294,066	$	(16,745	)	$	(136,557	)	$	162,410		$	21,646	$	294,066	$	(16,745	)	$	(136,557	)	$	162,410

	Quarter Ended June 30, 2018
	Common Shares		Additional Paid-In Capital		Accumulated Other Comprehensive Income (Loss)			Retained Deficit			Total Shareholders' Equity
Balance at April 1, 2018	$	18,598	$	210,248	$	(16,375	)	$	(116,545	)	$	95,926
Net income		—		—		—			8,608			8,608
Foreign currency translation adjustment		—		—		(123	)		—			(123	)
Shares issued under incentive plans, net of shares withheld for tax		26		385		—			—			411
Stock compensation expense		—		1,739		—			—			1,739
Shares issued in public offering, net of equity issuance costs		2,806		76,716		—			—			79,522
Declared dividends - $0.14 per share		—		—		—			(4,822	)		(4,822	)
Balance at June 30, 2018	$	21,430	$	289,088	$	(16,498	)	$	(112,759	)	$	181,261

Six Months Ended June 30, 2019

Common Shares

Additional
Paid-In Capital

Accumulated
Other
Comprehensive Income (Loss)

Retained
Deficit

Total
Shareholders'
Equity

Balance at January 1, 2019

$
21,547

$
292,558

$
(18,280
)

$
(141,187
)

$
154,638

Net income

—

—

—

13,376

13,376

Adoption of ASU 2016-02, net of
   tax of $332

—

—

—

905

905

Foreign currency translation
   adjustment

—

—

1,535

—

1,535

Shares issued under incentive plans,
   net of shares withheld for tax

99

(712
)

—

—

(613
)
Stock compensation expense

—

2,220

—

—

2,220

Declared dividends - $0.27 per share

—

—

—

(9,651
)

(9,651
)
Balance at June 30, 2019

$
21,646

$
294,066

$
(16,745
)

$
(136,557
)

$
162,410

Six Months Ended June 30, 2018

Common Shares

Additional
Paid-In Capital

Accumulated
Other
Comprehensive
Income (Loss)

Retained
Deficit

Total
Shareholders'
Equity

Balance at January 1, 2018

$
18,547

$
209,253

$
(14,541
)

$
(119,507
)

$
93,752

Net income

—

—

—

15,452

15,452

Adoption of ASU 2018-02

—

—

(315
)

315

—

Foreign currency translation
   adjustment

—

—

(1,843
)

—

(1,843
)
Shares issued under incentive plans,
   net of shares withheld for tax

77

427

—

—

504

Stock compensation expense

—

2,692

—

—

2,692

Pension liability, net of tax of $67

—

—

201

—

201

Shares issued in public offering, net
   of equity issuance costs

2,806

76,716

—

—

79,522

Declared dividends - $0.27 per share

—

—

—

(9,019
)

(9,019
)
Balance at June 30, 2018

$
21,430

$
289,088

$
(16,498
)

$
(112,759
)

$
181,261

For the Six Months Ended June 30,

2019

2018

Cash Flows From Operating Activities

Net income

$
13,376

$
15,452

Income (loss) from discontinued operations, net of income taxes

127

(911
)
Income from continuing operations

13,249

16,363

Adjustments to reconcile income (loss) from continuing operations to net cash provided
by (used for) operating activities

Depreciation

8,051

9,042

Amortization

4,046

4,315

Accelerated depreciation associated with restructuring activities

—

16

Non-cash stock-based compensation expense

2,220

2,305

(Gain) loss on disposal of fixed assets

(98
)

(314
)
Impairment charges

916

308

Other

340

(215
)
Payments on performance based compensation

(413
)

(1,249
)
Other long-term liabilities

3,514

(63
)
Cash flows provided by (used for) working capital

Accounts receivable

(56
)

9,106

Inventories

1,450

(2,454
)
Prepaid expenses and other current assets

(2,041
)

(1,807
)
Accounts payable and accrued expenses

(15,005
)

(8,130
)
Net cash provided by (used for) operating activities - continuing operations

16,173

27,223

Net cash provided by (used for) operating activities - discontinued operations

7,297

981

Net cash provided by (used for) operating activities

23,470

28,204

Cash Flows From Investing Activities

Capital expenditures

(4,406
)

(2,318
)
Proceeds from sale of property, plant and equipment

7,514

2,633

Net cash provided by (used for) investing activities - continuing operations

3,108

315

Net cash provided by (used for) investing activities - discontinued operations

—

—

Net cash provided by (used for) investing activities

3,108

315

Cash Flows From Financing Activities

Net borrowings (repayments) on credit facility

—

(72,491
)
Cash dividends paid

(9,733
)

(8,287
)
Proceeds from issuance of common stock

365

875

Proceeds from public offering of common stock, net of equity issuance costs

—

79,522

Shares withheld for employee taxes on equity awards

(978
)

(371
)
Net cash provided by (used for) financing activities - continuing operations

(10,346
)

(752
)
Net cash provided by (used for) financing activities - discontinued operations

—

—

Net cash provided by (used for) financing activities

(10,346
)

(752
)
Foreign exchange rate effect on cash

79

(6
)
Net increase in cash and restricted cash

16,311

27,761

Cash and restricted cash at January 1

58,894

11,179

Cash and restricted cash at June 30

$
75,205

$
38,940

	Six Months Ended June 30, 2020
	Common Shares		Additional Paid-In Capital			Accumulated Other Comprehensive Income (Loss)			Retained Deficit			Total Shareholders' Equity
Balance at January 1, 2020	$	21,785	$	296,363		$	(16,349	)	$	(135,117	)	$	166,682
Net income		—		—			—			25,094			25,094
Foreign currency translation adjustment		—		—			(1,535	)		—			(1,535	)
Shares issued under incentive plans, net of shares withheld for tax		60		(187	)		—			—			(127	)
Stock compensation expense		—		1,346			—			—			1,346
Declared dividends - $0.27 per share		—		—			—			(9,765	)		(9,765	)
Balance at June 30, 2020	$	21,845	$	297,522		$	(17,884	)	$	(119,788	)	$	181,695

	Six Months Ended June 30, 2019
	Common Shares		Additional Paid-In Capital			Accumulated Other Comprehensive Income (Loss)			Retained Deficit			Total Shareholders' Equity
Balance at January 1, 2019	$	21,547	$	292,558		$	(18,280	)	$	(141,187	)	$	154,638
Net income		—		—			—			13,376			13,376
Adoption of ASU 2016-02		—		—			—			905			905
Foreign currency translation adjustment		—		—			1,535			—			1,535
Shares issued under incentive plans, net of shares withheld for tax		99		(712	)		—			—			(613	)
Stock compensation expense		—		2,220			—			—			2,220
Declared dividends - $0.27 per share		—		—			—			(9,651	)		(9,651	)
Balance at June 30, 2019	$	21,646	$	294,066		$	(16,745	)	$	(136,557	)	$	162,410

	For the Six Months Ended June 30,
	2020			2019
Cash Flows From Operating Activities
Net income (loss)	$	25,094		$	13,376
Income (loss) from discontinued operations, net of income taxes		—			127
Income (loss) from continuing operations		25,094			13,249
Adjustments to reconcile income (loss) from continuing operations to net cash provided by (used for) operating activities
Depreciation		7,243			8,051
Amortization		4,518			4,046
Non-cash stock-based compensation expense		1,346			2,220
Gain on disposal of fixed assets		(7	)		(98	)
Gain on sale of notes receivable		(11,924	)		—
Impairment charges		—			916
Other		407			340
Payments on long-term performance based compensation		—			(413	)
Other long-term liabilities		478			3,514
Cash flows provided by (used for) working capital
Accounts receivable		(9,672	)		(56	)
Inventories		(5,453	)		1,450
Prepaid expenses and other current assets		(2,926	)		(2,041	)
Accounts payable and accrued expenses		2,681			(15,005	)
Net cash provided by (used for) operating activities - continuing operations		11,785			16,173
Net cash provided by (used for) operating activities - discontinued operations		—			7,297
Net cash provided by (used for) operating activities		11,785			23,470
Cash Flows From Investing Activities
Capital expenditures		(5,589	)		(4,406	)
Acquisition of business		(691	)		—
Proceeds from sale of property, plant and equipment		—			7,514
Proceeds on sale of notes receivable		1,200			—
Net cash provided by (used for) investing activities - continuing operations		(5,080	)		3,108
Net cash provided by (used for) investing activities - discontinued operations		—			—
Net cash provided by (used for) investing activities		(5,080	)		3,108
Cash Flows From Financing Activities
Cash dividends paid		(9,736	)		(9,733	)
Proceeds from issuance of common stock		235			365
Shares withheld for employee taxes on equity awards		(362	)		(978	)
Net cash provided by (used for) financing activities - continuing operations		(9,863	)		(10,346	)
Net cash provided by (used for) financing activities - discontinued operations		—			—
Net cash provided by (used for) financing activities		(9,863	)		(10,346	)
Foreign exchange rate effect on cash		(47	)		79
Net (decrease) increase in cash		(3,205	)		16,311
Cash at January 1		75,527			58,894
Cash at June 30	$	72,322		$	75,205

The accompanying unaudited condensed consolidated financial statements include the accounts of Myers Industries, Inc. and all wholly owned subsidiaries (collectively, the “Company”), and have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures are adequate to make the information not misleading. These interim financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, ~~2018.~~2019.

Results from our former Brazil Business, which was sold in 2017, are presented as discontinued operations. Net cash flows provided by discontinued operations in 2019 resulted from the remaining receipt of the tax benefit from a worthless stock deduction, which was recognized as part of the sale. Net income from discontinued operations for the six months ended June 30, 2019 related to interest income net of tax recognized on the receipt of the tax benefit in the first quarter of 2019. There was 0 discontinued operations activity for the quarter and six months ended June 30, 2020.

In the opinion of the Company, the accompanying condensed consolidated financial statements contain all adjustments (consisting of normal recurring accruals) necessary to present fairly the financial position as of June 30, ~~2019,~~2020, and the results of operations and cash flows for the periods presented. The results of operations for the quarter and six months ended June 30, ~~2019~~2020 are not necessarily indicative of the results of operations that will occur for the year ending December 31, ~~2019.~~2020.

In ~~February 2016,~~March 2020, the FASB issued ASU ~~2016-02,~~ ~~Leases,~~ ~~which created Accounting Standards Codification (“ASC”) Topic 842. Under~~2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. This ASU ~~2016-02, an entity recognizes right-of-use assets and lease liabilities~~provides optional guidance for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on ~~its balance sheet, and discloses key information about~~financial reporting due to the ~~amount, timing and uncertainty~~cessation of ~~cash flows arising from leasing arrangements.~~the London Interbank Offered Rate (LIBOR). The amendments in this update are effective for the Company as of March 12, 2020 through December 31, 2022. The Company adopted this standard effective March 12, 2020. The adoption of this standard had no effect in the ~~new guidance effective January 1, 2019, using~~quarter or six months ended June 30, 2020, and its future impact will depend on the ~~optional transition method,~~manner in which ~~required application of the new guidance to only those leases that existed at the date of adoption. The Company elected the “package of practical expedients,” which permitted~~ the Company ~~to not reassess under the new standard~~and its prior conclusions about lease identification, lease classification and initial direct costs. The Company also elected to apply the guidance at a portfolio level and use the discount rate corresponding to the remaining lease term at transition. Adoption of the new standard resulted in the recognition of right-of-use assets and lease liabilities of $5.9 million and $6.2 million, respectively, on January 1, 2019. The difference between the right-of-use assets and lease liabilities related primarily tolenders ultimately address the removal of ~~previously recorded accrued rent balances~~LIBOR as a result of recording straight-line rent expense for certain leases. In addition, the adoption resulted in an adjustment to opening retained earnings (deficit) of approximately $0.9 million, net of tax, on January 1, 2019. This cumulative-effect transition adjustment to opening retained earnings (deficit) relatedit relates to the ~~recognition of the remaining deferred gain on the sale-leaseback transaction that occurred~~Loan Agreement described in ~~2018. The standard did not have a material impact on the Company’s condensed consolidated results of operations or cash flows.~~

~~The following tables summarize the impacts of ASC 842 on the Company’s condensed consolidated financial statements:~~

~~Notes to Unaudited Condensed Consolidated Financial Statements – (Continued)~~

For the Six Months Ended June 30, 2019

As Reported

Adjustments

Balances Without
Adoption of
ASC 842

Net sales

$
273,400

$
—

$
273,400

Cost of sales

180,905

—

180,905

Gross profit

92,495

—

92,495

Selling, general and administrative expenses

71,277

(67
)

71,210

(Gain) loss on disposal of fixed assets

(98
)

—

(98
)
Impairment charges

916

—

916

Operating income

20,400

67

20,467

Interest expense, net

2,066

—

2,066

Income from continuing operations before income taxes

18,334

67

18,401

Income tax expense

5,085

18

5,103

Income from continuing operations

$
13,249

$
49

$
13,298

As of June 30, 2019

As Reported

Adjustments

Balances Without
Adoption of
ASC 842

Assets

Right of use asset - operating leases

$
5,983

$
(5,983
)

$
—

Deferred tax asset

6,490

316

6,806

Liabilities

Other current liabilities

$
14,639

$
242

$
14,881

Operating lease liability - short-term

2,000

(2,000
)

—

Operating lease liability - long-term

4,225

(4,225
)

—

Other liabilities

22,813

1,169

23,982

Shareholders’ Equity

Retained deficit

$
(136,557
)

$
(853
)

$
(137,410
)

In August 2018, the FASB issued ASU 2018-15, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40). This ASU aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). The ~~ASU is~~Company adopted this standard effective ~~for annual periods beginning after December 15, 2019,~~January 1, 2020 and interim periods within those annual periods. Early adoption is permitted and this ASU should be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. The Company is currently evaluating the impact the adoption of this standard ~~will~~did not have a material impact on its consolidated financial statements.

In August 2018, the FASB issued ASU 2018-14, Compensation – Retirement Benefits – Defined Benefit Plans – General (Subtopic 715-20). This ASU modifies the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans. ~~The~~For the Company, the ASU is effective retrospectively beginning with the 2020 annual financial statements, but is not applicable to its interim financial statements. The Company adopted this standard effective January 1, 2020 and the adoption of this standard is not expected to have a material impact on its annual consolidated financial statements.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for ~~annual periods ending after December 15, 2020, with early adoption permitted and should~~Fair Value Measurement. This ASU modifies the disclosure requirements on fair value measurements by removing, modifying, or adding certain disclosures. Certain disclosures in this ASU are required to be applied on a retrospective basis ~~to all periods presented.~~and others on a prospective basis. The Company ~~is currently evaluating the impact~~adopted this standard effective January 1, 2020 and the adoption of this standard ~~will~~did not have a material impact on its consolidated financial statements.

~~In August 2018, the FASB issued ASU 2018-13,~~ ~~Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement.~~ This ASU modifies the disclosure requirements on fair value measurements by removing, modifying, or adding certain disclosures. This guidance is effective for annual periods beginning after December 15, 2019, and interim periods within those annual periods. Early adoption is permitted. Certain disclosures in this ASU are required to be applied on a retrospective basis and others on a prospective basis. The Company is currently evaluating the impact the adoption of this standard will have on its consolidated financial statements.

In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350) - Simplifying the Test for Goodwill Impairment. This ASU eliminates Step 2 of the goodwill impairment test and requires goodwill impairment to be measured as the amount by which a reporting unit’s carrying amount exceeds its fair value, not to exceed the carrying amount of its goodwill. The ~~ASU is~~Company adopted this standard effective ~~for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. The guidance allows for early adoption for impairment testing dates after~~ January 1, ~~2017. The Company does not believe that~~2020 and the adoption of this ~~guidance will~~standard did not have a material impact on its consolidated financial ~~statements unless a goodwill impairment were to occur.~~statements.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments, which introduces new guidance for theaccounting for credit losses on instruments. The new guidance introduces an approach based on expected losses to estimate credit losses on certain types of financial instruments. The Company adopted the new guidance effective January 1, 2020. Adoption of the new standard resulted in changes to the Company’s accounting policy and disclosures related to its allowance for expected credit losses for accounts receivable. The impact of adopting this standard on the Company’s consolidated financial statements was not material and no cumulative transition adjustment was required.

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. This ASU is intended to simplify the accounting for income taxes by removing certain exceptions to the general principles in Topic 740 and by clarifying and amending existing guidance to improve consistent application. For the Company, this ASU is effective ~~for fiscal years~~ beginning ~~after December 15, 2019 including interim periods~~with the first quarter of 2021. Early adoption is permitted. Certain amendments within ~~that reporting period, with early adoption permitted for fiscal years beginning after December 15, 2018.~~this ASU are required to be applied on a retrospective basis, certain other amendments are required to be applied on a modified retrospective basis and all other amendments on a prospective basis. The Company is currently evaluating the impact the adoption of this standard will have on its consolidated financial statements.

The Company follows guidance included in ASC 820, Fair Value Measurements and Disclosures, for its financial assets and liabilities, as required. Under ASC 820, the hierarchy that prioritizes the inputs to valuation techniques used to measure fair value is divided into three levels:

~~Financial assets that are measured at net asset value, which is a practical expedient to estimating fair value, are not classified in the fair value hierarchy.~~

The Company has financial instruments, including cash, accounts receivable, accounts payable and accrued expenses. The fair value of these financial instruments approximates carrying value due to the nature and relative short maturity of these assets and liabilities.

The fair value of debt under the Company’s Loan Agreement, as defined in Note 13, approximates carrying value due to the floating rates and relative short maturity (less than 90 days) of ~~the~~any revolving borrowings under this agreement. The fair value of the Company’s fixed rate senior unsecured notes was estimated using market observable inputs for the Company’s comparable peers with public debt, including quoted prices in active markets and interest rate measurements which are considered Level 2 inputs. At June 30, ~~2019~~2020 and December 31, ~~2018,~~2019, the aggregate fair value of the Company's outstanding fixed rate senior unsecured notes was estimated ~~at $78.9~~to be $80.5 million and ~~$76.8~~$79.0 million, respectively.

9The purchase price allocation associated with the August 26, 2019 acquisition of Tuffy Manufacturing Industries, Inc., as described in Note 3, required fair value measurements using unobservable inputs which are considered Level 3 inputs. The fair value of the acquired intangible assets was determined using the income approach.

Management has established certain requirements that customers must meet before credit is extended. The financial condition of customers is continually monitored and collateral is usually not required. The Company evaluates the collectability of accounts receivable based on a combination of factors. The Company reviews historical trends for credit loss as well as current economic conditions in determining an estimate for its allowance for credit losses. Additionally, in circumstances where the Company is aware of a specific customer’s inability to meet its financial obligations, a specific allowance for credit losses is recorded against amounts due to reduce the net recognized receivable to the amount the Company reasonably expects will be collected.

The change in the allowance for credit losses for the six months ended June 30, 2020 was as follows:

The ~~following tables disaggregate the~~ Company’s revenue by major ~~market:~~market is as follows:

	For the Six Months Ended June 30, 2018									For the Six Months Ended June 30, 2020
	Material Handling		Distribution		Inter-company			Consolidated		Material Handling		Distribution		Inter-company			Consolidated
Consumer	$	44,277	$	—	$	—		$	44,277	$	51,498	$	—	$	—		$	51,498
Vehicle		52,301		—		—			52,301		30,125		—		—			30,125
Food and beverage		52,965		—		—			52,965		26,491		—		—			26,491
Industrial		70,396		—		(69	)		70,327		56,817		—		(23	)		56,794
Auto aftermarket		—		73,258		—			73,258		—		75,736		—			75,736
Total net sales	$	219,939	$	73,258	$	(69	)	$	293,128	$	164,931	$	75,736	$	(23	)	$	240,644

Revenue is recognized when obligations under the terms of a contract with customers are satisfied. In both the Distribution and Material Handling segments, this generally occurs with the transfer of control of the ~~Company’s~~ products. This transfer of control may occur at either the time of shipment from a Company facility, or at the time of delivery to a designated customer location. Obligations under contracts with customers are typically fulfilled within 90 days of receiving a purchase order from a customer, and generally no other future obligations are required to be performed. The Company generally does not enter into any long-term contracts with customers greater than one year. Based on the nature of the Company’s products and customer contracts, ~~the Company~~no deferred revenue has ~~not~~been recorded, ~~any deferred revenue,~~ with the exception of cash advances or deposits received from customers prior to transfer of control of the product. These advances are typically fulfilled within the ~~90 day~~90-day time frame mentioned above.

Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring the products. Certain contracts with customers include variable consideration, such as rebates or discounts. The Company recognizes estimates of this variable consideration each period, primarily based on the most likely level of consideration to be paid to the customer under the specific terms of the underlying programs. While the Company’s contracts with customers do not generally include explicit rights to return product, the Company will in practice allow returns in the normal course of business and as part of the customer relationship. ~~Thus, the Company estimates the expected~~Expected returns allowances are recognized each period based on an analysis of historical ~~experience. For certain businesses where~~experience, and when physical recovery of the product from returns occurs, ~~the Company records~~ an estimated right to return asset ~~from such recovery,~~is also recorded based on the approximate cost of the product.

Amounts included in the Condensed Consolidated ~~Statement~~Statements of Financial Position (Unaudited) related to revenue recognition include:

Sales, value added, and other taxes ~~the Company collects concurrent~~collected with revenue from customers are excluded from net sales. The ~~Company has elected to recognize the~~ cost for shipments to customers is recognized when control over products has transferred to the ~~customer. Costs for shipments to customers are~~customer and is classified as Selling, General and Administrative ~~Expenses~~expenses for the Company’s manufacturing business and as Cost of Sales for the Company’s distribution ~~business in the accompanying Condensed Consolidated Statements of Operations (Unaudited). The Company incurred costs~~business. Costs for shipments to customers in Selling, General and Administrative ~~Expenses of~~ expenses were approximately ~~$2.0~~$1.7 million and ~~$2.6~~$2.0 million for the quarters ended June 30, ~~2019~~2020 and ~~2018,~~2019, respectively, and ~~$4.1~~$3.3 million and ~~$5.3~~$4.1 million for the six months ended June 30, ~~2019~~2020 and ~~2018,~~2019, respectively, and in Cost of Sales of were approximately ~~$1.5 million and $1.4~~$1.5 million for each of the quarters ended June 30, ~~2019~~2020 and ~~2018, respectively,~~2019 and $2.9 million ~~and $2.8 million~~ for each of the six months ended June 30, ~~2019~~2020 and ~~2018, respectively. All other internal distribution costs are recorded in Selling, General and Administrative Expenses.~~2019.

Based on the ~~short term~~short-term nature of contracts described above, ~~the Company does not incur significant~~ contract acquisition ~~costs.~~costs are not significant. These costs, as well as other incidental items that are immaterial in the context of the contract, are recognized as expense as incurred.

On August 26, 2019, the Company acquired the assets of Tuffy Manufacturing Industries, Inc. (“Tuffy”), a warehouse distributor of tire repair equipment and supplies, which is included in the Distribution Segment. The Tuffy acquisition aligns with the Company’s strategy to grow in key niche markets and focus on strategic account customers. The purchase price for the acquisition was $18.7 million, which includes a working capital adjustment of $0.7 million that was paid during the quarter ended March 31, 2020. The Company funded the acquisition using available cash.

The acquisition of Tuffy was accounted for using the acquisition method, whereby all of the assets acquired and liabilities assumed were recognized at their fair value on the acquisition date, with any excess of the purchase price over the estimated fair value recorded as goodwill. The following table summarizes the allocation of the purchase price based on the estimated fair value of assets acquired and liabilities assumed based on their preliminary estimated fair values at the acquisition date, which are subject to adjustment. The purchase accounting will be finalized within one year from the acquisition date.

The goodwill represents the future economic benefits arising from other assets acquired that could not be individually and separately recognized, and the Company expects that the goodwill recognized for the acquisition will be deductible for tax purposes.

As ~~part~~ of ~~its ongoing strategy, the Company continues to evaluate its various real estate holdings. As~~June 30, 2020 and December 31, 2019, a ~~result of these initiatives, certain buildings were reclassified as held for sale in 2018 and 2019. Based on the estimated fair~~building with a carrying value of ~~these buildings (using primarily third party offers considered to be Level 2 inputs), less estimated costs to sell, the Company recorded impairment charges of $0.3~~$1.9 million during the quarter ended June 30, 2018. No impairment charges were recorded during the quarter ended June 30, 2019. Impairment charges of $0.9 million and $0.3 million were recorded during the six months ended June 30, 2019 and 2018, respectively. As of December 31, 2018, the Company had classified $4.4 million of buildings as held for sale, in Other Assets in the Condensed Consolidated Statements of Financial Position (Unaudited). No assets werewas classified as held for sale ~~as of June 30, 2019.~~and is included in Other Assets. During the first half of 2019, the Company sold two buildings, which had previously been held for sale, for total net proceeds of $7.4 million. These buildings were ~~included~~ in ~~the Company’s Material Handling Segment.~~

On December 18, 2017, the Company, collectively with its wholly owned subsidiary, Myers Holdings Brasil, Ltda. (“Holdings”), completed the sale of its subsidiaries, Myers do Brasil Embalagens Plasticas Ltda. and Plasticos Novel do Nordeste Ltda. (collectively, the “Brazil Business”), to Novel Holdings – Eireli (“Buyer”), an entity controlled by a member of the Brazil Business’ management team. The Brazil Business was part of the Material Handling Segment.

~~The Company has agreed~~When a facility meets held for sale classification criteria, it is also evaluated for impairment by comparing its carrying value to ~~be the guarantor under a factoring arrangement between the Buyer and Banco Alfa de Investimento S.A. until December 31, 2019 for up~~its estimated fair value less estimated costs to $7 million, in the event the Buyer is unable to meet its obligations under this arrangement. The Company also holds a first lien against certain machinery and equipment, exercisable only upon default by the Buyer under the guaranty. Based on the nature of the guaranty, as well as the existence of the lien, the Company believes thesell. Estimated fair value of ~~the guaranty is immaterial (based primarily~~these buildings was based on third party offers, which are Level ~~3 inputs), and thus has recorded no liability~~2 inputs. NaN impairment related to ~~this guaranty~~assets held for sale was recognized in the ~~Condensed Consolidated Statements~~quarters ended June 30, 2020 or 2019 or for the six months ended June 30, 2020. An impairment charge of ~~Financial Position (Unaudited). This guaranty also creates~~$0.9 million was recorded during the six months ended June 30, 2019 in connection with a ~~variable interest to~~building meeting the ~~Company in the Brazil Business. Based on the terms~~held for sale criteria.

5. Settlement of ~~the transaction~~Note Receivable and the fact that the Company has no management involvement or voting interests in the Brazil Business following the sale, the Company does not have any power to direct the significant activities of the Brazil Business, and is thus not the primary beneficiary.Lease Guarantee

~~On February 17,~~In 2015, the Company sold its Lawn and Garden business to an entity controlled by Wingate Partners V, L.P. (“L&G Buyer”), which later became HC Companies, Inc. (“HC”). The terms of the sale included promissory notes ~~totaling $20 million that were originally set~~from HC. Due to ~~mature in August 2020 with a 6% interest rate. During the third quarter~~uncertainty of 2018, management of the Lawn and Garden business, now named HC Companies, Inc. (“HC”), requested an extension to the maturity of the notes as part of an effort to restructure their debt. The Company believes there is uncertainty about the ability to collect on the notes and corresponding accrued interest, and as a result, the Company recordedcollection, a provision for expected loss of $23.0 million was recorded within continuing operations during the third quarter of ~~2018.~~2018 to fully impair the notes and corresponding interest receivable. The Company also ceased recognizing interest income ~~as of September 30, 2018~~ following ~~the~~ recognition of the provision.

Also, in connection with the sale of the Lawn and Garden business, the Company became a guarantor for any remaining rent payments under one of HC’s facility leases expiring in September 2025. Annual rent for the facility is approximately $2 million. Due to the financial risk associated with HC, the Company assessed its range of potential obligations under the lease guarantee, and recorded a liability and related pre-tax charge of $10.3 million during the third quarter of 2018. The carrying value of the lease contingency as of December 31, 2019 was $10.7 million, which represented the initial liability recorded plus accretion and was included inOther Liabilities.

In ~~April~~January 2020, the Company sold to HC the fully-reserved promissory notes and related accrued interest receivable in exchange for $1.2 million and the release from the lease guarantee resulting in an $11.9 million pre-tax gain.

In March 2019, the Company committed to implementing a restructuring plan involving its Ameri-Kart Corp. subsidiary (“Ameri-Kart”) that operates within the Material Handling Segment. The Company plans to consolidate manufacturing operations currently conducted at Ameri-Kart’s Cassopolis, Michigan and Bristol, Indiana facilities with expanded operations in a new facility in Bristol, Indiana (the “Ameri-Kart Plan”). In December 2019, the Company entered into an agreement ~~with HC to amend~~where a new manufacturing and ~~restate~~distribution facility in Bristol, Indiana will be constructed, and when substantially complete, the ~~notes (“Amended~~Company will lease that new facility and ~~Restated Notes”). The Amended and Restated Notes maintain~~sell its existing facility in Bristol, Indiana. In December 2019, the amounts due under the original terms of the notes, including interest, and extend the maturity to August 2022. The agreement to amend and restate the notes did not change management’s assessment of the uncertainty to collectCompany also provided one year advance termination notice on the ~~notes.~~

~~In addition,~~lease of its Cassopolis, Michigan facility. The Ameri-Kart Plan is expected to be substantially completed in the first quarter of 2021 and total restructuring costs expected to be incurred are approximately ~~$8.6~~$1.1 million, ~~of the purchase price~~primarily related to ~~the Lawn~~equipment relocation and Garden sale was placed in escrow that was due to be settled by August 2016. The release of these funds had been extended pending the resolution of indemnification claims, as further described in Note 12. In April 2018, the Company reached agreement on the material terms of a settlement, and, as a result, recorded a pre-tax charge of $1.225 million to discontinued operations for the quarter ended March 31, 2018. The settlement was finalized and paid in May 2018, and upon settlement and release of any further obligation on behalf of the Company, the remaining $7.4 million was released from escrow to the Company.

In connection with the financial risk described above with HC, the Company further assessed its potential obligations under a lease guarantee granted as part of the sale of the Lawn and Garden business. Refer to Note 12 for further information with regards to this guarantee.facility shut down costs.

~~Summarized selected financial information for discontinued operations for the quarters and six months ended June 30, 2019 and 2018 are presented in the following table:~~

Net cash flows provided by discontinued operations in 2019 resulted from the remaining receipt of the tax benefit from a worthless stock deduction, which was recognized as part of the sale of the Brazil Business. Net cash flows provided by discontinued operations in 2018 resulted from the partial receipt of the tax benefit from the worthless stock deduction related to the Brazil Business. The worthless stock deduction allowed the Company to reduced its estimated U.S. federal tax payments in 2018 by $4.3 million. This was partially offset by the payment of expenses related to the sale of the Brazil Business and the payment of the settlement with the L&G Buyer noted above.

OnIn March ~~20,~~ 2019, the Company committed to implementing a restructuring plan involving its Ameri-Kart Corp. subsidiary (“Ameri-Kart”) that operates within the Company’s Material Handling Segment. The Company plans to consolidate manufacturing operations currently conducted at Ameri-Kart’s Cassopolis, Michigan facility with expanded operations in Indiana, and eliminate up to 30 positions in connection with the consolidation (the “Ameri-Kart Plan”). Total restructuring costs expected to be incurred are approximately $0.9 million, which include employee severance and other employee-related costs of approximately $0.2 million, equipment relocation and facility shut down costs of approximately $0.6 million and non-cash charges, primarily accelerated depreciation charges on property, plant and equipment, of approximately $0.1 million. No costs were incurred during the quarter and six months ended June 30, 2019 related to the Ameri-Kart Plan. The Ameri-Kart Plan is expected to be substantially completed in the first half of 2020.

~~On March 18, 2019, the Company committed to implementing a restructuring plan relating to~~ transformation initiatives within the ~~Company’s~~ Distribution Segment (the “Distribution Transformation Plan”) that are intended to increase sales force effectiveness, reduce costs and improve contribution margins. The Company ~~plans to realign~~realigned its Distribution Segment’s commercial sales structure, which ~~includes~~included the elimination of certain sales and administrative positions, ~~as well as~~and put into place plans to expand its e-commerce platform. Total restructuring costs expected to be incurred are approximately $0.9 million, primarily related to employee severance and other employee-related costs. No restructuring charges were incurred during the quarter ended June 30, 2019. During the six months ended June 30, 2019, the Company incurred restructuring charges of $0.9 million and does not expect to incur any additional restructuring charges in connection withAll actions under the Distribution Transformation ~~Plan. The Distribution Transformation~~ Plan ~~is expected to be~~were substantially completed by the end of 2019.

On March 9, 2017, the Company announced a restructuring plan to improve the Company’s organizational structure and operational efficiency within the Material Handling Segment (the “Material Handling Plan”), which related primarily to anticipated facility shutdowns and associated activities. Total restructuring costs incurred related to the Material Handling Plan were approximately $7.7 million, which includes employee severance and other employee-related costs of approximately $3.1 million, $2.6 million related to equipment relocation and facility shut down costs and non-cash charges, primarily accelerated depreciation charges on property, plant and equipment, of approximately $2.0 million. All actions under the Material Handling Plan are completed. The Company incurred $0.1 million of

NaN restructuring charges ~~associated with the Material Handling Plan during the six months ended June 30, 2018. No costs~~ were ~~incurred during 2019.~~

~~Notes to Unaudited Condensed Consolidated Financial Statements – (Continued)~~

~~As noted above, there were no restructuring charges~~ incurred during the quarters ended June 30, ~~2019~~2020 and ~~2018. The~~2019. Charges for the above restructuring ~~charges noted above~~plans for the six months ended June 30, 2020 and 2019 ~~and 2018~~ are ~~presented in the Condensed Consolidated Statements of Operations (Unaudited)~~ as follows:

~~The table below summarizes restructuring activity for the six months ended June 30, 2019:~~

During the quarter ended March 31, 2019, the Company reclassified a facility that was closed in connection with the Material Handling Plan as held for sale. Based on the estimated fair value of this facility (using primarily a third party offer considered to be a Level 2 input), less estimated costs to sell, the Company recognized an impairment charge of $0.9 million during the quarter ended March 31, 2019. The facility was sold in May 2019 for net proceeds of $2.9 million, which are included in the net proceeds discussed in Note 3.

In addition to the restructuring charges noted above, the Company has also incurred $0.1 million and $0.2 million of other associated costs of the Distribution Transformation Plan during the quarter and six months ended June 30, 2019, respectively, which are included in Selling, General, and Administrative expenses in the accompanying Condensed Consolidated Statements of Operations (Unaudited), and are primarily related to third party consulting costs. Additional estimated costs of $0.2 million and $0.6 million are expected to be incurred throughout the remainder of 2019 related to the Ameri-Kart Plan and the Distribution Transformation Plan, respectively.

Inventories are valued at the lower of cost or market for last-in, first-out (“LIFO”) inventory and lower of cost or net realizable value for first-in, first-out (“FIFO”) inventory. Approximately 3050 percent of inventories are valued using the LIFO method of determining cost. All other inventories are valued atusing the FIFO method of determining cost. An actual valuation of inventory under the LIFO method can be made only at the end of each year based on inventory levels and costs at that time. Accordingly, interim LIFO calculations must be based on management’s estimates of expected year-end inventory levels and costs. Because these calculations are subject to many factors beyond management’s control, annual results may differ from interim results as they are subject to the final year-end LIFO inventory valuation. Based on management’s projections of inventory levels and costs, 0 adjustment to the LIFO reserve was recorded for the quarter or six months ended June 30, 2020. During 2019, ~~and 2018,~~ one inventory pool had a reduction in inventory quantities that was expected to ~~hold~~remain through year-end, and therefore, ana LIFO liquidation adjustment of $0.3 million was recorded ~~for~~to decrease cost of sales in the ~~quarters~~quarter and six months ended June 30, ~~2019 and 2018 to decrease cost of sales by $0.3 million and $0.5 million, respectively, as a result of the liquidation of LIFO inventories.~~2019.

~~The balance~~In August 2019, a manufacturing defect was identified for certain boxes produced within the Material Handling segment in ~~other current liabilities is comprised~~May and June 2019. Certain of the ~~following:~~affected boxes require replacement. The total range of cost to replace these boxes is estimated to be $3.5 million to $4.0 million. In the quarter ended September 30, 2019, $3.5 million of estimated costs were recorded related to this matter, of which $0.7 million remains accrued as of June 30, 2020 and is included within Other Current Liabilities.

The balance in ~~other liabilities~~Other Liabilities (long-term) is comprised of the following:

The change in goodwill for the six months ended June 30, ~~2019~~2020 was as follows:

Intangible assets other than goodwill primarily consist of trade names, customer relationships, patents, non-competition agreements and technology assets established in connection with acquisitions. These intangible assets, other than certain trade names, are amortized over their estimated useful lives. ~~The Company has indefinite-lived~~Indefinite-lived trade names ~~which~~ had a carrying value of $9.8 million at both June 30, ~~2019~~2020 and December 31, ~~2018.~~2019. Refer to Note 3 for the intangible assets acquired through the Tuffy acquisition during the quarter ended September 30, 2019.

Net income per common share, as shown on the accompanying Condensed Consolidated Statements of Operations (Unaudited), is determined on the basis of the weighted average number of common shares outstanding during the periods as follows:

~~Notes to Unaudited Condensed Consolidated Financial Statements – (Continued)~~

Options to purchase ~~643,813~~455,958 and ~~648,313~~466,658 shares of common stock that were outstanding for the for the quarter and six months endedJune 30, 2020, respectively, and 643,813 and 648,313 for the quarter and six months ended June 30, 2019, respectively, ~~and 252,132~~ ~~for the six months ended June 30, 2018,~~ were not included in the computation of diluted earnings per share as the exercise prices of these options were greater than the average market price of common shares, and were therefore anti-dilutive. ~~There were no options~~

Notes to ~~purchase shares of common stock excluded from the computation of diluted earnings per share for the quarter ended June 30, 2018.~~Unaudited Condensed Consolidated Financial Statements – (Continued)

The Company’s Amended and Restated 2017 Incentive Stock Plan (the “2017 Plan”) authorizes the Compensation Committee of the Board of Directors to issue up to 5,126,950 shares of various stock awards including stock options, performance stock units, restricted stock units and other forms of equity-based awards to key employees and directors. Options granted and outstanding vest over the requisite service period and expire ten years from the date of grant.

In March 2019, the Company granted 235,474 stock options with a weighted average exercise price of $18.54 per share and a weighted average fair value of $5.78 per share. The fair value of options granted is estimated using a binomial lattice option pricing model. Also in March 2019, the Company granted 77,810 and 101,500 time-based and performance-based restricted stock units, respectively, with a weighted average fair value of $18.54 per share. In April 2019, the Company granted 33,152 time-based restricted stock units with a weighted average fair value of $18.10 per share.

Stock compensation expense was approximately ~~$1.3~~$0.7 million and ~~$1.2~~$1.3 million for the quarters ended June 30, ~~2019~~2020 and ~~2018,~~2019, respectively, and ~~$2.2~~$1.3 million and ~~$2.3~~$2.2 million for the six months ended June 30, ~~2019~~2020 and ~~2018,~~2019, respectively. These expenses are included in Selling, General and Administrative ~~expenses in the accompanying Condensed Consolidated Statements of Operations (Unaudited).~~ expenses. Total unrecognized compensation cost related to non-vested stock-based compensation arrangements at June 30, ~~2019~~2020 was approximately ~~$7.6~~$7.1 million, which will be recognized over the next three years, as such compensation is earned.

In May 2018, the Company completed a public offering of 4,600,000 shares of its common stock at a price to the public of $18.50 per share. The net proceeds from the offering were approximately $79.5 million, after deducting underwriting discounts and commissions and $0.5 million of offering expenses paid by the Company. The Company used a portion of the net proceeds received from the offering to repay a portion of its outstanding indebtedness during the second quarter of 2018.

The Company is a defendant in various lawsuits and a party to various other legal proceedings arising in the ordinary course of business, some of which are covered in whole or in part by insurance. When a loss arising from these matters is probable and can reasonably be estimated, ~~we record~~ the most likely amount of the estimated ~~loss, or the minimum estimated liability when the~~probable loss is ~~estimated using~~recorded, or if a range of probable loss can be estimated and no ~~point~~amount within the range is ~~more probable of occurrence~~a better estimate than ~~another.~~any other amount, the minimum amount in the range is recorded. As additional information becomes available, any potential liability related to these matters ~~will be~~is assessed and the estimates ~~will be~~are revised, if necessary.

Based on current available information, management believes that the ultimate outcome of these matters, including those described below, will not have a material adverse effect on our financial position, cash flows or overall trends in our results of operations. However, these matters are subject to inherent ~~uncertainties.~~uncertainties, and unfavorable rulings could occur. If ~~new information becomes available or~~ an unfavorable ruling were to occur, there exists the possibility of a material adverse impact on the financial position and results of operations of the period in which the ruling occurs, or in future periods.

In September 2015, the U.S. Environmental Protection Agency (“EPA”) informed a subsidiary of the Company, Buckhorn, Inc. (“Buckhorn”) via a notice letter and related documents (the “Notice Letter”) that it considers Buckhorn to be a potentially responsible party (“PRP”) in connection with the New Idria Mercury Mine site (“New Idria Mine”). New Idria Mining & Chemical Company (“NIMCC”), which owned and/or operated the New Idria Mine through 1976, was merged into Buckhorn Metal Products Inc. in 1981, which was subsequently acquired by Myers Industries in 1987. As a result of the EPA Notice Letter, Buckhorn and the Company engaged in negotiations with the EPA with respect to a draft Administrative Order of Consent (“AOC”) proposed by the EPA for the Remedial Investigation/Feasibility Study (“RI/FS”) to determine the extent of remediation necessary and the screening of alternatives.

~~Notes to Unaudited Condensed Consolidated Financial Statements – (Continued)~~

During the fourth quarter of 2018, the Company and the EPA finalized the AOC and related Statement of Work (“SOW”) with regards to the New Idria Mine. The AOC is effective as of November 27, 2018, the date that it was executed by the EPA. The AOC and accompanying SOW document the terms, conditions and procedures for the Company’s performance of the RI/FS. In addition, the AOC requires the Company to provide $2 million of financial assurance to the EPA to secure its performance during the estimated life of the RI/FS. In January 2019, the Company provided this assurance as a letter of credit. The AOC also includes provisions for payment by the Company of the EPA’s costs of oversight of the RI/FS, including a prepayment in the amount of $0.2 million, which was paid in January 2019.

A draft work plan for the RI/FS, in accordance with the AOC and related SOW, was submitted to the EPA for review and approval in July 2019. Upon preparation of the draft work plan for the RI/FS, the Company received preliminary estimates from its consultants for the cost of the execution of the work plan. Based on these preliminary estimates, the Company recognized additional expense of $4.0 million during the second quarter ~~and six months ended June 30,~~of 2019. These preliminary estimates will continue to be refined through the finalization and approval of the draft work plan, which is anticipated to occur ~~by the end of 2019.~~in 2020. The Company believes it has insurance coverage that applies to the New Idria Mine and thus may be able to recover a portion of the estimated costs; however, ~~to date,~~as of June 30, 2020, the Company has not recognized ~~any~~ potential recovery in its consolidated financial statements. ~~No expenses were recorded related~~

Notes to ~~the New Idria Mine~~Unaudited Condensed Consolidated Financial Statements – (Continued)

(Dollars in ~~the quarter or six months ended June 30, 2018.~~thousands, except where otherwise indicated)

Since October 2011, when New Idria was added to the Superfund National Priorities List by the EPA, the Company has recognized $9.9 million of costs, of which approximately ~~$3.2~~$3.4 million has been paid to date. These costs are comprised primarily of estimates to perform the RI/FS, negotiation of the AOC, identification of possible insurance resources and other PRPs, EPA oversight fees, past cost claims made by the EPA (who, as of April 2020, is represented by the U.S. Department of Justice), periodic monitoring, and responses to unilateral administrative orders issued by the EPA. NaN expenses were recorded related to the New Idria Mine in the quarter and six months ended June 30, 2020. Expenses of $4.0 million were recorded in the quarter and six months ended June 30, 2019. As of June 30, ~~2019,~~2020, the Company has a total reserve of ~~$6.7~~$6.5 million related to the New Idria Mine, of which $1.1 million is classified in Other Current Liabilities and ~~$5.6~~$5.4 million in Other Liabilities ~~on the Condensed Consolidated Statements of Financial Position (Unaudited)~~ (long-term).

It is possible that adjustments to the aforementioned reserves will be necessary as new information is obtained, including after finalization and EPA approval of the work plan for the RI/FS. Estimates of the Company’s liability are based on current facts, laws, regulations and technology. Estimates of the Company’s environmental liabilities are further subject to uncertainties regarding the nature and extent of site contamination, the range of remediation alternatives available, evolving remediation standards, imprecise engineering evaluation and cost estimates, the extent of remedial actions that may be required, the extent of oversight by the EPA and the number and financial condition of other PRPs that may be named, as well as the extent of their responsibility for the remediation.

At this time, we have not accrued for remediation costs in connection with this site as we are unable to estimate the liability, given the circumstances referred to above, including the fact that the final remediation strategy has not yet been determined.

A number of parties, including the Company and its subsidiary, Buckhorn (as successor to NIMCC), were alleged by trustee agencies of the United States and the State of California to be responsible for natural resource damages due to environmental contamination of areas comprising the historical New Almaden mercury mines located in the Guadalupe River Watershed region in Santa Clara County, California (“County”). In 2005, Buckhorn and the Company, without admitting liability or chain of ownership of NIMCC, resolved the trustees’ claim against them through a consent decree that required them to contribute financially to the implementation by the County of an environmentally beneficial project within the impacted area. Buckhorn and the Company negotiated an agreement with the County, whereby Buckhorn and the Company agreed to reimburse one-half of the County’s costs of implementing the project, originally estimated to be approximately $1.6 million. As a result, in 2005, the Company recognized expense of $0.8 million representing its share of the initial estimated project costs, of which approximately $0.5 million has been paid to date. In April 2016, the Company was notified by the County that the original cost estimate may no longer be appropriate due to expanded scope and increased costs of construction and provided a revised estimate of between $3.3 million and $4.4 million. The Company completed a detailed review of the support provided by the County for the revised estimate, and as a result, recognized additional expense of $1.2 million in 2016. NoNaN costs were incurred related to New Almaden in the quarters or six months ended June 30, ~~2019~~2020 or ~~2018.~~2019. As of June 30, ~~2019,~~2020, the Company has a total reserve of $1.5 million related to the New Almaden Mine, of which $0.3 million is classified in Other Current Liabilities and $1.2 million in Other Liabilities ~~on the Condensed Consolidated Statements of Financial Position (Unaudited)~~ (long-term).

~~Notes to Unaudited Condensed Consolidated Financial Statements – (Continued)~~

The project has not yet been implemented though significant work on design and planning has been performed. The Company is currently awaiting notice from Santa Clara County on the expected timing of fieldwork to commence. As work on the project occurs, it is possible that adjustments to the aforementioned reserves will be necessary to reflect new information. In addition, the Company may have claims against and defenses to claims by the County under the 2005 agreement that could reduce or offset its obligation for reimbursement of some of these potential additional costs. With the assistance of environmental consultants, the Company will closely monitor this matter and will continue to assess its reserves as additional information becomes available.

In connection with the sale of the Lawn and Garden business, as described in Note 4, the Company received Notices of Indemnification Claims in April 2015 and July 2016 (collectively, the “Claims”), alleging breaches of certain representations and warranties under the agreement resulting in alleged losses in the amount of approximately $10 million. As described in Note 4, approximately $8.6 million of the sale proceeds that were placed in escrow were due to be settled in August 2016; however, the release of these funds had been extended pending the resolution of the Claims, which were the subject of a lawsuit in the Delaware Chancery Court.

In April 2018, the Company reached agreement on the material terms of a settlement, and as a result, recorded a pre-tax charge of $1.225 million to discontinued operations for the quarter ended March 31, 2018. The settlement agreement was finalized in May 2018, and the settlement amount was funded from the escrow account. In addition, upon settlement and release of any further obligation on behalf of the Company, the remaining $7.4 million was released from escrow to the Company in the second quarter of 2018.

In connection with the sale of the Lawn and Garden business, as described in Note 4, the Company is a guarantor for one of HC’s facility leases expiring in September 2025 for any remaining rent payments under the lease for which HC is unable to meet its obligations. Current annual rent for the facility is approximately $2 million, and is subject to annual CPI increases throughout the lease term. In connection with the financial risk associated with HC, as described in Note 4, the Company assessed its range of potential obligations under the lease guarantee, and as a result of this analysis, recorded a liability and related pre-tax charge of $10.3 million during the third quarter of 2018. The carrying value of the lease contingency as of ~~June 30, 2019~~ ~~and December 31, 2018 was $10.6 million and $10.4 million, respectively, which represents the initial liability recorded plus accretion and is included in~~ ~~Other Liabilities on the Condensed Consolidated Statements of Financial Position (Unaudited)~~.

On December 11, 2018, No Spill Inc. filed suit against Scepter Manufacturing LLC and Scepter Corporation (“Scepter”) in the United States District Court for the District of Kansas asserting infringement of two patents, breach of contract, and trade dress claims in relation to plastic gasoline containers Scepter manufactures and sells in the United States. A full schedule in the case has not yet issued. Scepter intends to defend itself vigorously in this matter. On December 28, 2019, Scepter filed petitions for inter partes review (“IPR”) of the two patents asserted by No Spill, Inc. in the District of Kansas litigation. The U.S. Patent & Trademark Office (“USPTO”) instituted one IPR and denied the other. For the instituted IPR, a final decision on the validity of the patent is expected by July 2021. Due to the inherent uncertainties of litigation, the Company cannot accurately predict the ultimate outcome of this matter, and is unable at this time to determine whether the outcome of the litigation will have a material impact on its results of operations, financial condition, or cash flows. Accordingly, the Company has not recorded any reserves for this matter.

June 30,

December 31,

2019

2018

Loan Agreement

$
��

$
—

4.67% Senior Unsecured Notes due 2021

40,000

40,000

5.25% Senior Unsecured Notes due 2024

11,000

11,000

5.30% Senior Unsecured Notes due 2024

15,000

15,000

5.45% Senior Unsecured Notes due 2026

12,000

12,000

78,000

78,000

Less unamortized deferred financing costs

1,017

1,210

$
76,983

$
76,790

	June 30,		December 31,
	2020		2019
Loan Agreement	$	—	$	—
4.67% Senior Unsecured Notes due January 15, 2021		40,000		40,000
5.25% Senior Unsecured Notes due January 15, 2024		11,000		11,000
5.30% Senior Unsecured Notes due January 15, 2024		15,000		15,000
5.45% Senior Unsecured Notes due January 15, 2026		12,000		12,000
		78,000		78,000
Less unamortized deferred financing costs		624		824
		77,376		77,176
Less current portion long-term debt		39,956		—
Long-term debt	$	37,420	$	77,176

~~Under the terms of the Loan Agreement, the Company may borrow up to $200 million, reduced for letters of credit issued.~~ As of June 30, ~~2019,~~2020, the Company had $194.2 million available under the Loan Agreement. The Company had $5.8 million of letters of credit issued related to insurance and other contracts requiring financial assurance in the ordinary course of business, ~~at June 30, 2019.~~including the $2 million provided to the EPA as discussed in Note 12. Borrowings under the Loan Agreement bear interest at the LIBOR rate, prime rate, federal funds effective rate, the Canadian deposit offered rate, or the euro currency reference rate depending on the type of loan requested by the Company, plus the applicable margin as set forth in the Loan Agreement.

The Company also holds Senior Unsecured Notes (“Notes”), which range in face value from $11 million to $40 million, with interest rates ranging from 4.67% to 5.45%, payable semiannually, and maturing between January 2021 and January 2026. At June 30, 2020, $78.0 million of the Notes were outstanding.

The weighted average interest rate on borrowings under the Company’s long-term debt was ~~6.27%~~6.28% and ~~5.82%~~6.27% for the quarters ended June 30, ~~2019~~2020 and ~~2018,~~2019, respectively, and ~~6.25%~~6.26% and ~~5.55%~~6.25% for the six months ended June 30, ~~2019~~2020 and ~~2018,~~2019, respectively, which includes a quarterly facility fee on the used and unused portion, as well as amortization of deferred financing costs.

As of June 30, ~~2019,~~2020, the Company was in compliance with all of its debt covenants associated with its Loan Agreement and Notes. The most restrictive financial covenants for all of the Company’s debt are an interest coverage ratio (defined as earnings before interest, taxes, depreciation and amortization, as adjusted, divided by interest expense) and a leverage ratio (defined as total debt divided by earnings before interest, taxes, depreciation and amortization, as adjusted).

The Company and certain of its subsidiaries have pension and profit sharing plans covering substantially all of their employees. The Company’s defined benefit pension plan, The Pension Agreement between Akro-Mils and United Steelworkers of America Local No. 1761-02, provides benefits primarily based upon a fixed amount for each year of service. The plan was frozen in 2007, and ~~thus~~no benefits for service were ~~no longer~~ accumulated after this date.

The Company expects to make ~~a contribution~~contributions to the plan ~~of $30~~totaling $150 in ~~2019~~2020.

The Company’s effective tax rate was 24.4% and 24.6% for the quarter and six months ended June 30, 2020, respectively, compared to 27.9% and 27.7% for the quarter and six months ended June 30, 2019, ~~respectively, compared to 27.0% and 26.2% for the quarter and six months ended June 30, 2018,~~ respectively. The effective income tax rate for both periods was different than the Company’s statutory rate, primarily due to state taxes and non-deductible expenses.

The total amount of gross unrecognized tax benefits that would reduce the Company’s effective tax rate was ~~$1.0~~$1.1 million at June 30, ~~2019~~2020 and December 31, ~~2018.~~2019.

The Company and its subsidiaries file U.S. Federal, state and local, and non-U.S. income tax returns. As of June 30, ~~2019,~~2020, the Company is no longer subject to U.S. Federal examination by tax authorities for tax years before 2015. The Company’s 2017 U.S. Federal tax return is currently under audit by the Internal Revenue Service (“IRS”). The Company is subject to state and local examinations for tax years of ~~2013~~2015 through 2018. In addition, the Company is subject to non-U.S. income tax examinations for tax years of ~~2014~~2015 through ~~2018.~~2019.

On March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”) was signed into law. The CARES Act, among other things, includes provisions relating to refundable payroll tax credits, deferment of employer side social security payments, net operating loss carryback periods, alternative minimum tax credit refunds, modifications to the net interest deduction limitations and technical corrections to tax depreciation methods for qualified improvement property. While the Company expects to realize certain benefits under the CARES Act and is continuing to evaluate its impacts, it does not believe the CARES Act will materially affect its consolidated financial statements.

The Company determines if an arrangement is a lease at inception. The Company has leases for manufacturing facilities, distribution centers, warehouses, office space and equipment, with remaining lease terms of one to ~~nine~~eight years. Certain of these leases include options to extend the lease for up to five years, and some include options to terminate the lease early. Leases with an initial term of 12 months or less are not recorded on the statement of financial position; the Company recognizes lease expense for these short-term leases on a straight-line basis over the lease term. Operating leases with an initial term greater than 12 months are included in right of use asset – operating leases (“ROU assets”), operating lease liability ~~–short~~– short term, and operating lease liability – long term in the Condensed Consolidated Statement of Financial Position (Unaudited).

The ROU assets represent the right to use an underlying asset for the lease term and the lease liabilities represent the ~~Company’s~~ obligation to make lease ~~payments arising from the lease.~~payments. ROU assets and lease liabilities are recognized at commencement date based on the present value of the lease payments over the lease term. ~~As most of the Company’s~~When leases do not provide an implicit rate, the ~~Company uses its~~Company’s incremental borrowing rate is used, which is then applied at the portfolio level, based on the information available at commencement date in determining the present value of lease payments. The Company ~~uses the implicit rate when readily determinable. The Company~~ has also elected not to separate lease and non-lease components. The lease terms ~~may~~ include options to extend or terminate the lease when it is reasonably certain ~~that~~ the ~~Company~~option will ~~exercise that option.~~be exercised. Lease expense is recognized on a straight-line basis over the lease term.

Amounts included in the Condensed Consolidated Statement of Financial Position (Unaudited) related to leases include:

~~Future minimum rental commitments (undiscounted) as of~~In December ~~31, 2018 under ASC 840 were as follows:~~

On February 27, 2018, the Company completed a sale-leaseback transaction for its distribution center in Pomona, California for a net purchase price of $2.3 million. The Company realized a gain on the sale of $2.0 million, of which $0.7 million was recognized during the quarter ended March 31, 2018. The remaining $1.3 million was recognized ratably over the term of the ten-year lease at approximately $0.1 million per year, until January 1, 2019, ~~upon the adoption of ASU 2016-02 as discussed in Note 1. Simultaneous with closing the sale,~~ the Company entered into an agreement where a ~~ten-year operating~~new manufacturing and distribution facility in Bristol, Indiana will be constructed, and when it is substantially complete, the Company will lease ~~arrangement~~that new facility and sell its existing facility in Bristol, Indiana. As described in Note 6, this agreement was in connection with the Ameri-Kart Plan, which includes facility consolidation for this business within the Material Handling Segment. This lease is not included in the tables disclosed above because it has not yet commenced; it commences when the facility is substantially complete, which is expected to be in the second half of 2020. Upon commencement, the lease has an initial term of fifteen years with base annual rent of approximately ~~$0.1~~$0.8 million during the first ~~year, followed by annual~~year. Inclusive of scheduled increases ~~of 3% through~~ the ~~remainder~~total expected future minimum lease payments during the initial term of the lease ~~period. This facility~~ is ~~included in~~approximately $13.5 million, but may vary depending on the ~~Company’s Distribution Segment.~~actual cost of certain construction activities. At commencement of this lease, the Company expects assets and liabilities within the Consolidated Statement of Financial Position to each increase by approximately $9 million.

~~Using the criteria of ASC 280,~~ ~~Segment Reporting, the~~The Company manages its business under ~~two~~2 operating segments, Material Handling and Distribution, consistent with the manner in which ~~our~~the Chief Operating Decision Maker (“CODM”) evaluates performance and makes resource allocation decisions. None of the reportable segments include operating segments that have been aggregated. These segments contain individual business components that have been combined on the basis of common management, customers, products, production processes and other economic characteristics. The Company accounts for intersegment sales and transfers at cost plus a specified mark-up.

The Material Handling Segment manufactures a broad selection of plastic reusable containers, pallets, small parts bins, bulk shipping containers, storage and organization products and rotationally-molded plastic tanks for water, fuel and waste handling. This segment conducts its primary operations in the United States and Canada. Markets served ~~encompass various niches of~~include industrial manufacturing, food processing, retail/wholesale products distribution, agriculture, automotive, recreational vehicles, marine vehicles, healthcare, appliance, bakery, electronics, textiles, consumer, and others. Products are sold both directly to end-users and through distributors.

The Distribution Segment is engaged in the distribution of equipment, tools, and supplies used for tire servicing and automotive undervehicle repair and the manufacture of tire repair and retreading products. The product line includes categories such as tire valves and accessories, tire changing and balancing equipment, lifts and alignment equipment, service equipment and tools, and tire repair/retread supplies. The Distribution Segment also manufactures and sells certain traffic markings, including reflective highway marking tape. The Distribution Segment operates domestically through its sales offices and ~~four~~five regional distribution centers in the United States, and in certain foreign countries through export sales. In addition, the Distribution Segment operates directly in certain foreign markets, principally Central America, through foreign branch operations. Markets served include retail and truck tire dealers, commercial auto and truck fleets, auto dealers, general service and repair centers, tire retreaders, and government agencies. The acquisition of Tuffy, described in Note 3, is included in the Distribution Segment.

Total sales from foreign business units were approximately ~~$11.4~~$9.2 million and ~~$13.1~~$11.4 million for the quarters ended June 30, ~~2019~~2020 and ~~2018,~~2019, respectively, and ~~$24.2~~$18.2 million and ~~$24.6~~$24.2 million for the six months ended June 30, ~~2019~~2020 and ~~2018, respectively.~~2019.

Summarized segment detail for the quarters and six months ended June 30, ~~2019~~2020 and ~~2018~~2019 are presented in the following table:

	For the Quarter Ended June 30,						For the Six Months Ended June 30,						For the Quarter Ended June 30,						For the Six Months Ended June 30,
	2019			2018			2019			2018			2020			2019			2020			2019
Net Sales
Material Handling	$	95,902		$	103,130		$	198,853		$	219,939		$	80,855		$	95,902		$	164,931		$	198,853
Distribution		38,395			37,477			74,569			73,258			37,541			38,395			75,736			74,569
Inter-company sales		(12	)		(47	)		(22	)		(69	)		(2	)		(12	)		(23	)		(22	)
Total net sales	$	134,285		$	140,560		$	273,400		$	293,128		$	118,394		$	134,285		$	240,644		$	273,400

Income (loss) from continuing operations before income taxes
Operating income
Material Handling	$	17,589		$	17,323		$	33,796		$	34,053		$	15,796		$	17,589		$	30,963		$	33,796
Distribution		3,328			2,786			3,541			4,524			1,636			3,328			3,486			3,541
Corporate(1)		(10,735	)		(6,998	)		(16,937	)		(13,444	)		(5,176	)		(10,735	)		1,105			(16,937	)
Total operating income		10,182			13,111			20,400			25,133			12,256			10,182			35,554			20,400
Interest expense, net		(1,017	)		(1,313	)		(2,066	)		(2,952	)		(1,194	)		(1,017	)		(2,263	)		(2,066	)
Income from continuing operations before income taxes	$	9,165		$	11,798		$	18,334		$	22,181		$	11,062		$	9,165		$	33,291		$	18,334

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

This Quarterly Report on Form 10-Q and the information incorporated by reference contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, including information regarding the Company’s financial outlook, future plans, objectives, business prospects and anticipated financial performance. Forward-looking statements can be identified by words such as “will,” “believe,” “anticipate,” “expect,” “estimate,” “intend,” “plan,” or variations of these words, or similar expressions. These forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on the Company’s current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, these statements inherently involve a wide range of inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. The Company’s actual actions, results, and financial condition may differ materially from what is expressed or implied by the forward-looking statements.

Specific factors that could cause such a difference include, without limitation, impacts from the novel coronavirus (COVID-19) pandemic on our business, operations, customers and capital position; the impact of COVID-19 on local, national and global economic conditions; the effects of various governmental responses to the COVID-19 pandemic; raw material availability, increases in raw material costs, or other production costs; risks associated with our strategic growth initiatives or the failure to achieve the anticipated benefits of such initiatives; unanticipated downturn in business relationships with customers or their purchases; competitive pressures on sales and pricing; changes in the markets for the Company’s business segments; changes in trends and demands in the markets in which the Company competes; operational problems at our manufacturing facilities or unexpected failures at those facilities; future economic and financial conditions in the United States and around the world; inability of the Company to meet future capital requirements; claims, litigation and regulatory actions against the Company; changes in laws and regulations affecting the Company; and other risks and uncertainties detailed from time to time in the Company’s filings with the Securities and Exchange Commission, including without limitation, the risk factors disclosed in Item 1A, “Risk Factors,” in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2018.~~2019 as updated in Item 1A, “Risk Factors,” in this Quarterly Report on Form 10-Q. Given these factors, as well as other variables that may affect our operating results, readers should not rely on forward-looking statements, assume that past financial performance will be a reliable indicator of future performance, nor use historical trends to anticipate results or trends in future periods. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date thereof. The Company expressly disclaims any obligation or intention to provide updates to the forward-looking statements and the estimates and assumptions associated with them.

The Company conducts its business activities in two ~~distinct~~reportable segments: The Material Handling Segment and the Distribution Segment. The former Brazil Business, which was sold in December 2017, ~~and the Lawn and Garden business, which was sold in February 2015, are~~is classified as discontinued operations in all periods presented.

The Company designs, manufactures, and markets a variety of plastic and rubber products. The Material Handling Segment manufactures products that range from plastic reusable material handling containers and small parts storage bins to plastic OEM parts, custom plastic products, consumer fuel containers, military water containers as well as ammunition packaging and shipping containers. The Distribution Segment is engaged in the distribution of tools, equipment and supplies used for tire, wheel and under vehicle service on passenger, heavy truck and off-road vehicles, as well as the manufacturing of tire repair and retreading ~~products~~products.

The Company’s results of operations for the quarter and six months ended June 30, 2020 are discussed below. However, the Company’s past results of operations may not reflect its future operating trends. In March 2020, the COVID-19 pandemic began to affect the U.S. economy and has created additional uncertainty for the Company’s operations, particularly for the remainder of 2020. Regulatory actions in response to COVID-19 have varied across jurisdictions and have included closure of nonessential businesses. The duration and extent of these measures is unknown, including possible reimplementation of any measures that have been removed or relaxed. Through the date of this report, most of the Company’s businesses are considered essential because they supply food and agricultural, automotive, healthcare, industrial and consumer end markets. Accordingly, those businesses have continued to operate. However, two manufacturing facilities of our Ameri-Kart business in the Material Handling segment and our Distribution business in Central America were temporarily closed in part of March and April 2020 due to the regulatory requirements resulting from the pandemic. Beyond the impact of these temporary closures, some of our businesses have been and may continue to be affected by the broader economic effects from COVID-19 and related regulatory actions, including customer demand for our products. The Company’s results in the second quarter of 2020 reflect this volatility with lower demand for our products in the beginning of the quarter and then improving towards the end of the quarter for most end-markets. The Company believes it is well-positioned to manage through this uncertainty – it has a strong balance sheet, with sufficient liquidity and borrowing capacity, and a diverse product offering and customer base.

Comparison of the Quarter Ended June 30, ~~2019~~2020 to the Quarter Ended June 30, ~~2018~~2019

Net sales for the quarter ended June 30, ~~2019~~2020 were ~~$134.3~~$118.4 million, a decrease of ~~$6.3~~$15.9 million or 4%12% compared to the quarter ended June 30, ~~2018.~~2019. Net sales were negatively impacted by lower ~~sales~~ volume, primarily in the Material Handling Segment, of ~~$7.1~~$19.9 million, lower pricing of $0.7 million, and the effect of unfavorable currency translation of $0.3 million, and were partially offset by ~~higher pricing~~$5.0 million of incremental sales due to the Tuffy acquisition in the Distribution Segment on August 26, 2019. Tuffy’s historical annual sales are approximately ~~$1.1~~$20 million.

Net sales in the Material Handling Segment decreased ~~$7.2~~$15.0 million or 7%16% for the quarter ended June 30, ~~2019~~2020 compared to the quarter ended June 30, ~~2018.~~2019. The decrease in net sales was due to lower ~~sales~~ volume of ~~$7.9~~$14.0 million, lower pricing of $0.7 million, and the effect of unfavorable ~~foreign~~ currency translation of $0.3 ~~million, partially offset by higher pricing of $1.0~~ million. The lower ~~sales~~ volume was primarily due to declines in the ~~consumer~~vehicle market, food and beverage market and the ~~vehicle~~industrial market ~~(mainly~~and was partially offset by higher volume in the ~~recreational vehicle market).~~consumer market.

Net sales in the Distribution Segment ~~increased~~decreased $0.9 million or 2% for the quarter ended June 30, ~~2019~~2020 compared to the quarter ended June 30, ~~2018,~~2019, primarily ~~the~~as a result of ~~higher sales~~lower volume of ~~$0.8~~$5.9 million ~~and higher pricing~~partially offset by $5.0 million of ~~$0.1 million.~~

Gross profit margin increased to ~~35.0%~~36.0% in the quarter ended June 30, ~~2019~~2020 compared to ~~34.1%~~35.0% for the quarter ended June 30, ~~2018,~~2019, primarily due to ~~higher pricing of $1.1 million and~~ lower commodity raw material ~~costs. This was partially~~costs offsetting the effect of lower volumes.

Gross profit decreased $4.3 million, or 9%, primarily due to lower volume as described under Net Sales above, partly offset by ~~unfavorable mix within the~~ lower ~~sales volumes noted above.~~commodity raw material costs.

Selling, general and administrative (“SG&A”) expenses for the quarter ended June 30, ~~2019~~2020 were ~~$36.8~~$30.3 million, ~~an increase~~a decrease of ~~$2.3~~$6.5 million or 7%18% compared to the same period in the prior year. SG&A expenses in the second quarter 2019 ~~were impacted primarily by~~included a $4.0 million charge related to the environmental contingencies discussed in Note 12. ~~This was partially offset by~~Year-over-year comparisons were also affected by: lower compensation and benefit costs of ~~$1.2~~$1.0 million, ~~mainly due to actions taken under~~lower travel expenses of $0.9 million, lower freight of $0.3 million and savings from the Distribution Transformation Plan, that were partly offset by $0.9 million of incremental SG&A from the August 26, 2019 Tuffy acquisition.

Net interest expense for the quarter ended June 30, 2020 was $1.2 million, an increase of $0.2 million, or 20%, compared with $1.0 million for the quarter ended June 30, 2019. The higher net interest expense was due primarily to lower interest income in the current year.

The Company’s effective tax rate was 24.4% for the quarter ended June 30, 2020, compared to 27.9% for the quarter ended June 30, 2019. The decrease in the effective tax rate was primarily the result of lower non-deductible expenses. Refer to Note 15.

Comparison of the Six Months Ended June 30, 2020 to the Six Months Ended June 30, 2019

Net sales for the six months ended June 30, 2020 were $240.6 million, a decrease of $32.8 million or 12% compared to the six months ended June 30, 2019. Net sales were negatively impacted by lower volume, primarily in the Material Handling Segment, of $40.4 million, lower pricing of $1.9 million, and the effect of unfavorable currency translation of $0.4 million, and were partially offset by $9.9 million of incremental sales due to the Tuffy acquisition, in the Distribution Segment, on August 26, 2019. Tuffy’s historical annual sales are approximately $20 million.

Net sales in the Material Handling Segment decreased $33.9 million or 17% for the six months ended June 30, 2020 compared to the six months ended June 30, 2019. The decrease in net sales was due to lower volume of $31.6 million, lower pricing of $1.9 million, and the effect of unfavorable currency translation of $0.4 million. The lower volume was primarily due to declines in the vehicle market, food and beverage market and the industrial market and was partially offset by higher volume in the consumer market

Net sales in the Distribution Segment increased $1.1 million or 1% for the six months ended June 30, 2020 compared to the six months ended June 30, 2019, primarily the result of $9.9 million of incremental sales due to the August 26, 2019 Tuffy acquisition partly offset by $8.8 million of lower volume.

Gross profit margin increased to 35.3% in the six months ended June 30, 2020 compared to 33.8% for the six months ended June 30, 2019, primarily due to lower commodity raw material costs offsetting the effect of lower volumes.

Gross profit decreased $7.4 million, or 8%, primarily due to lower volume as described under Net Sales above, partly offset by lower commodity raw material costs.

SG&A expenses for the six months ended June 30, 2020 were $61.4 million, a decrease of $9.9 million or 14% compared to the same period in the prior year. SG&A expenses in the second quarter 2019 included a $4.0 million charge related to the environmental contingencies discussed in Note 12 and $0.9 million of restructuring costs incurred in the prior year related to the implementation of the Distribution Transformation Plan that did not reoccur in 2020. Year-over-year comparisons were also affected by: lower compensation and benefit costs of $3.0 million, lower travel expenses of $1.0 million, lower freight ~~costs~~ of ~~$0.6 million.~~$0.8 million and savings from the Distribution Transformation Plan, that were partly offset by $1.8 million of incremental SG&A from the August 26, 2019 Tuffy acquisition.

As discussed in Note 5,6, the Company has implemented various restructuring programs.

~~The~~In the Material Handling Segment, the Ameri-Kart Plan ~~was announced during the first quarter~~involves consolidation of ~~2019~~two manufacturing facilities into a single new manufacturing facility, and is expected to be substantially completed in the first ~~half~~quarter of ~~2020. No~~2021. In connection with this plan, the Company plans to commence a new facility lease once construction of the new facility is substantially completed, as described in Note 16. Although construction has commenced, no restructuring costs were incurred during the ~~quarter~~six months ended June 30, 2020 or 2019 related to the Ameri-Kart Plan. As previously announced, the Company expects annualized benefits of approximately $1.5 million upon completion.

The Distribution Transformation Plan was announced during the first quarter of 2019 and ~~is expected to be~~was substantially completed by the end of 2019. No costs were incurred ~~in connection with the Distribution Transformation Plan~~ during ~~the quarter ended June 30, 2019. As previously announced, the Company expects annualized benefits of $5 to $7 million after 2019.~~

~~The Material Handling Plan was initiated in the first quarter of 2017 and is completed.~~

Net interest expense for the quarter ended June 30, 2019 was $1.0 million, a decrease of $0.3 million, or 23%, compared with $1.3 million for the quarter ended June 30, 2018. The lower interest expense was due primarily to the lower average outstanding borrowings for the period. The lower borrowings were driven by cash flow from operations and the proceeds generated by the public equity offering completed in the second quarter of 2018.

The Company’s effective tax rate was 27.9% for the quarter ended June 30, 2019, compared to 27.0% for the quarter ended June 30, 2018. The effective tax rate was slightly higher in 2019, primarily due to higher estimates of state taxes and non-deductible expenses.

~~Comparison of the Six Months Ended June 30, 2019 to the Six Months Ended June 30, 2018~~

~~Net sales for~~ the six months ended June 30, 2019 were $273.4 million, a decrease of $19.7 million or 7% compared to the six months ended June 30, 2018. Net sales were negatively impacted by lower sales volume of $21.6 million and the effect of unfavorable currency translation of $1.0 million, and were partially offset by higher pricing of approximately $2.9 million.

Net sales in the Material Handling Segment decreased $21.1 million or 10% for the six months ended June 30, 2019 compared to the six months ended June 30, 2018. The decrease in net sales was due to lower sales volume of $22.7 million and the effect of unfavorable foreign currency translation of $1.0 million, partially offset by higher pricing of approximately $2.6 million. The lower sales volume was primarily due to declines in the food and beverage market and the vehicle market (mainly in the recreational vehicle market).

Net sales in the Distribution Segment increased $1.3 million or 2% for the six months ended June 30, 2019 compared to the six months ended June 30, 2018, primarily the result of higher sales volume of $1.0 million and higher pricing of $0.3 million.

Gross profit margin increased to 33.8% in the six months ended June 30, 2019 compared to 32.4% for the six months ended June 30, 2018, primarily due to higher pricing of $2.9 million and lower raw material costs. This was partially offset by unfavorable mix within the lower sales volumes noted above.

SG&A expenses for the six months ended June 30, 2019 were $71.3 million, an increase of $1.3 million or 2% compared to the same period in the prior year. SG&A expenses in 2019 were primarily impacted by a $4.0 million charge related to the environmental contingencies discussed in Note 12 and by restructuring2020. Restructuring costs of $0.9 million incurred in the current year related to the Distribution Transformation Plan. This was partially offset by lower compensation and benefit costs of $1.9 million, mainly due to actions taken under the Distribution Transformation Plan, as well as lower freight costs of $1.1 million and lower legal and professional fees of $0.7 million.

~~As discussed in Note 5, the Company has implemented various restructuring programs.~~

~~The Ameri-Kart Plan was announced during the first quarter of 2019 and is expected to be substantially completed in the first half of 2020. No costs~~ were incurred during the six months ended June 30, ~~2019 related to the Ameri-Kart Plan. As previously announced, the Company expects annualized benefits of approximately $1.5 million upon completion.~~

~~The Distribution Transformation Plan was announced during the first quarter of 2019 and is expected to be substantially completed by the end of~~ 2019. The Company incurred $0.9 million of restructuring costs in connection with the Distribution Transformation Plan during the six months ended June 30, 2019. As previously announced, the Company expects annualized benefits of $5 to $7 million after 2019.

The Material Handling Plan was initiated in the first quarter of 2017 and is completed. No costs were incurred during the six months ended June 30, 2019 compared to $0.1 million of restructuring costs incurred in connection with the Material Handling Plan during the six months ended June 30, 2018.

The gain on disposal of fixed assets for the six months ended June 30, 2019 was $0.1 million compared to a gain of $0.3 million in the prior year. The gain in 2018 was primarily due to the sale and leaseback of the distribution center in Pomona, California, as discussed in Note 16.

During the six months ended June 30, 2019, the Company recognized ana $0.9 million impairment charge ~~of $0.9 million compared to $0.3 million in the prior year. The impairment in 2019 primarily related to a facility that was previously closed~~ in connection with ~~the Material Handling Plan and reclassified~~classifying a previously-closed facility as held for sale. See further discussion in Note 4.

During the six months ended June 30, 2020, the Company recorded a pre-tax gain of $11.9 million related to the sale ~~during~~to HC of the ~~first quarter~~fully-reserved promissory notes and related accrued interest receivable in exchange for $1.2 million and the release from a lease guarantee with a carrying value of ~~2019,~~$10.7 million related to one of HC’s facilities as discussed in Note 5.

Net interest expense for the six months ended June 30, ~~2019~~2020 was ~~$2.1~~$2.3 million, ~~a decrease~~an increase of ~~$0.9~~$0.2 million, or ~~30%~~10%, compared with ~~$3.0~~$2.1 million during the six months ended June 30, ~~2018.~~2019. The ~~lower~~higher interest expense was due primarily to ~~the~~ lower average outstanding borrowings during the six months ended June 30, 2019 as compared to the same period in 2018. The lower borrowings were driven by cash flow from operations and the proceeds generated by the public equity offering completedinterest income in the ~~second quarter of 2018.~~

The Company’s effective tax rate was 24.6% for the six months ended June 30, 2020, compared to 27.7% for the six months ended June 30, ~~2019, compared to 26.2% for~~2019. The decrease in the ~~six months ended June 30, 2018. The~~ effective tax rate was ~~slightly higher in 2019,~~ primarily ~~due to higher estimates~~the result of ~~state taxes and~~lower non-deductible expenses. Refer to Note 15.

Income from discontinued operations, net of income taxes was $0.1 million for the six months ended June 30, 2019 compared to a loss of $0.9 million for the six months ended June 30, 2018. The loss in 2018 related to a charge of $0.9 million, net of tax of $0.3 million, as a result of agreement on the material terms of a settlement with the L&G Buyer related to the indemnification claims discussed in Note 12.

The Company’s primary sources of liquidity are cash on hand, cash generated from ~~its operating~~operations and ~~financing activities. The cash flows from operating activities are driven primarily by~~availability under the ~~Company’s operating results and changes in its working capital requirements which is supplemented by the Company’s utilization of its current credit facilities. In addition,~~Loan Agreement (defined below). At June 30, 2020, the Company ~~completed a public equity offering in the second quarter of 2018 that generated $79.5~~had $72.3 million of ~~net proceeds. The~~cash, $194.2 million available under the Loan Agreement and outstanding debt with face value of $78.0 million. Based on this liquidity and borrowing capacity, the Company ~~used a portion of~~believes it is well-positioned to manage through the net proceeds received from the offering to repay a portion of its outstanding indebtedness during the second quarter of 2018 and intends to use the remaining proceeds to fund the growth of the business, including selective acquisitions, and for other general corporate purposes.

uncertainty caused by COVID-19. The Company believes that cash on hand, cash flows from operations and available ~~borrowing~~capacity under its Loan Agreement will be sufficient to meet expected business requirements including capital expenditures, dividends, working capital, debt service, and to fund future ~~growth.~~growth, including selective acquisitions.

Net cash provided by operating activities from continuing operations was ~~$16.2~~$11.8 million for the six months ended June 30, ~~2019,~~2020, compared to ~~$27.2~~$16.2 million in the same period in ~~2018.~~2019. The decrease was primarily due to ~~changes in working capital of $12.4 million, which was primarily driven by a higher variable compensation payout, timing of collections from customers and~~ lower volume ~~with third party subcontractors in 2019.~~of sales.

Net cash provided by operating activities from discontinued operations was $7.3 million in 2019 and resulted from the remaining receipt of the tax benefit from the worthless stock deduction related to the Brazil Business (see Note 4). Net cash flows provided by discontinued operations in 2018 resulted from the the partial receipt of the tax benefit from the worthless stock deduction related to the Brazil Business. The worthless stock deduction allowed the Company to reduce its estimated federal tax payments in 2018 by $4.3 million. This was partially offset by the payment of expenses related to the sale of the Brazil Business ~~and the payment of the settlement with the L&G Buyer.~~in 2017.

Net cash ~~provided~~used by investing activities ~~from~~of continuing operations was $5.1 million for the six months ended June 30, 2020 compared to cash provided of $3.1 million for the six months ended June 30, 2019. In 2020, the Company paid the working capital adjustment of $0.7 million related to the 2019 ~~compared~~acquisition of Tuffy discussed in Note 3, and received proceeds from the sale of notes receivable of $1.2 million as discussed in Note 5. In 2019, the Company received proceeds from the sale of fixed assets of $7.5 million, substantially all of which related to ~~cash provided~~the sale of ~~$0.3~~two buildings as discussed in Note 4. Capital expenditures were $5.6 million and $4.4 million for the six months ended June 30, ~~2018. Capital expenditures were $4.4 million~~2020 and ~~$2.3 million for the six months ended June 30,~~ 2019, ~~and 2018,~~ respectively. Full year 2020 capital expenditures ~~in 2019~~ are expected to be approximately ~~$10~~$15 million. The Company received proceeds of $7.5 million in the first half of 2019 from the sale of fixed assets, substantially all of which was derived from the sale of two buildings previously classified as held for sale, as discussed in Note 3 and Note 5. The Company received proceeds of $2.6 million in the first half of 2018 from the sale of fixed assets, which were primarily due to the sale and leaseback of the distribution center in Pomona, California, as discussed in Note 16.

~~The Company received net proceeds of $79.5 million from the public offering of common stock in 2018. Net payments on the credit facility were $72.5 million for the six months ended June 30, 2018.~~ There were no net payments or borrowings on the credit facility for the six months ended June 30, 2020 or 2019. The Company used cash to pay dividends of $9.7 million ~~and $8.3 million~~ for each of the six months ended June 30, ~~2019~~2020 and ~~2018, respectively.~~2019.

In March 2017, the Company entered into a Fifth Amended and Restated Loan Agreement (the “Loan Agreement”). The Loan Agreement ~~replaced~~amended the pre-existing ~~$300 million~~ senior revolving credit ~~facility with a~~facility’s borrowing limit to $200 million, ~~facility~~inclusive of letters of credit, and extended the ~~term~~maturity date from December 2018 to March 2022. ~~The~~As of June 30, 2020, the Company ~~also holds~~had $5.8 million of letters of letters of credit issued related to insurance and other financing contracts in the ordinary course of business, including the $2 million provided to the EPA as described in Note 12, and there was $194.2 million available under our Loan Agreement. Borrowings under the Loan Agreement bear interest at the LIBOR rate, prime rate, federal funds effective rate, the Canadian deposit offered rate, or the eurocurrency reference rate depending on the type of loan requested by the Company, in each case plus the applicable margin as set forth in the Loan Agreement.

At June 30, 2020, $78 million face value of Senior Unsecured Notes ~~(“Notes”), which~~are outstanding. The series of four notes range in face value from $11 million to $40 million, with interest rates ranging from 4.67% to 5.45%, payable semiannually, and maturing between January 15, 2021 and 2026. ~~At June 30, 2019, $78~~The $40 million note of ~~the~~these Senior Unsecured Notes ~~were outstanding.~~

Total debt outstanding at June 30, 2019 was $77.0 million, net of $1.0 million of deferred financing costs, compared with $76.8 million at December 31, 2018. The Company’s Loan Agreement provides available borrowing up to $200 million, reduced for letters of credit issued. As of June 30, 2019, the Company had $5.8 million of letters of credit issued related to insurance and other contracts requiring financial assurance in the ordinary course of business and there was $194.2 million available under our Loan Agreement.is due January 15, 2021.

As of June 30, ~~2019,~~2020, the Company was in compliance with all of its debt covenants. The most restrictive financial covenants for all of the Company’s debt are an interest coverage ratio (defined as earnings before interest, taxes, depreciation and amortization, as adjusted, divided by interest expense) and a leverage ratio (defined as total debt divided by earnings before interest, taxes, depreciation and amortization, as adjusted). The ratios as of and for the period ended June 30, ~~2019~~2020 are shown in the following table:

The Company does not have any off-balance sheet arrangements that have, or are ~~reasonable~~reasonably expected to have, a material current or future effect on its financial condition, ~~changes in financial condition, revenues~~results of operations, liquidity, capital expenditures or capital ~~resources that are material.~~resources.

Item 3. Quantitative and ~~Qualitative~~Qualitative Disclosures About Market Risk

The Company has certain financing arrangements that require interest payments based on floating interest ~~rates. The~~rates, and to that extent, the Company’s financial results are subject to changes in the market rate of interest. At present, the Company has not entered into any interest rate swaps or other derivative instruments to fix the interest rate on any portion of its financing arrangements with floating rates. As of June 30, ~~2019,~~2020, the Company has no borrowings outstanding under its floating rate debt.

Some of the Company’s subsidiaries operate in foreign countries and their financial results are subject to exchange rate movements. The Company has operations in Canada with foreign currency exposure, primarily due to U.S. dollar sales made from businesses in Canada to customers in the United ~~States (“U.S.”). These sales are denominated in U.S. dollars.~~States. The Company has a systematic program to limit its exposure to fluctuations in exchange rates related to certain assets and liabilities of its operations in Canada that are denominated in U.S. dollars. The net exposure generally ranges from $1 million to $3 million. The foreign currency contracts and arrangements created under this program are not designated as hedged items under ASC 815, Derivatives and Hedging, and accordingly, the changes in the fair value of the foreign currency arrangements, which have been immaterial, are recorded in the Condensed Consolidated Statements of Operations (Unaudited). The Company’s foreign currency arrangements are typically three months or less and are settled before the end of a reporting period. At June 30, ~~2019,~~2020, the Company had no foreign currency arrangements or contracts in place.

The Company uses certain commodities, primarily plastic resins, in its manufacturing processes. The cost of operations can be affected as the market for these commodities changes. The Company currently has no derivative contracts to hedge this risk; however, the Company also has no significant purchase obligations to purchase fixed quantities of such commodities in future periods. Significant future increases in the cost of plastic resin or other adverse changes in the general economic environment could have a material adverse impact on the Company’s financial position, results of operations or cash flows.

The Company maintains disclosure controls and procedures, as defined under Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended, that are designed to ensure that information required to be disclosed in the Company’s reports under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the Commission’s rules and forms and that such information is accumulated and communicated to the Company’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure.

The Company carries out a variety of on-going procedures, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, to evaluate the effectiveness of the design and operation of the Company’s disclosure controls and procedures. Based on the foregoing, the Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of June 30, ~~2019.~~2020.

During the six months ended June 30, ~~2019,~~2020, there have been no changes in our internal control over financial reporting during the period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Certain legal proceedings in which the Company is involved are discussed in Note 12, Contingencies, in the Unaudited Condensed Consolidated Financial Statements in Part I of this report, and Part I, Item 3 of the Company's Annual Report on Form 10-K for the year ended December 31, ~~2018.~~2019. The Company’s disclosures relating to legal proceedings in Note 12, Contingencies, in the Unaudited Condensed Consolidated Financial Statements in Part I of this report is incorporated into Part II of this report by reference. The Company is a defendant in various lawsuits and a party to various other legal proceedings, in the ordinary course of business, some of which are covered in whole or in part by insurance. We believe that the outcome of these lawsuits and other proceedings will not individually or in the aggregate have a future material adverse effect on our consolidated financial position, results of operations or cash flows.

For a discussion of risk factors related to the Company, refer to Part 1, Item 1A, “Risk Factors,” contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. The following risk factor should be read in conjunction with the risk factors described in the Annual Report on Form 10-K.

The COVID-19 pandemic could negatively affect our business, financial position, results of operations and/or liquidity.

In December 2019, a strain of coronavirus (COVID-19) first surfaced in Wuhan, China, and has since been labeled a pandemic and has spread rapidly to other areas of the world, including our primary markets. Regulatory actions in response to the COVID-19 pandemic have included closure of nonessential businesses and other requirements to maintain social distance and limit further spread of the coronavirus. Through the date of this report, most of our businesses are considered essential because they supply food and agricultural, automotive, healthcare, industrial and consumer end markets. Accordingly, these businesses have continued to operate. However, two manufacturing facilities of our Ameri-Kart business in the Material Handling segment and our Distribution business in Central America were temporarily closed due to the regulatory requirements resulting from the pandemic. Beyond the impact of these temporary closures, some of our businesses have been and may continue to be affected by the broader economic effects from the COVID-19 and related regulatory actions, including customer demand for our products. While we have so far been able to source required materials and products at reasonable cost, the pandemic may also affect our supply chain in ways that are beyond our control. We may also incur costs or experience further disruption to comply with new or changing regulations in response to the pandemic.

The overall magnitude of the COVID-19 pandemic, including the extent of its direct and indirect impact on our business, financial position, results of operations or liquidity is inherently uncertain due to the rapid development and fluidity of the situation. Further, the ultimate impact of the COVID-19 pandemic depends on many factors that are not within our control, including, but not limited, to: governmental, business and individuals’ actions that have been and continue to be taken in response to the COVID-19 pandemic; the severity and duration of outbreaks of the virus; the impact of the COVID-19 pandemic and actions taken in response on global and regional economies, travel, and economic activity; the availability of federal, state, local or non-U.S. funding programs; general economic uncertainty in key global markets and financial market volatility; global economic conditions and levels of economic growth; and the pace of recovery, particularly in our end markets, when the COVID-19 pandemic subsides.

(c)The following table presents information regarding the Company’s stock repurchase plan during the quarter ended June 30, ~~2019~~2020.

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Ohio	34-0778636
(State or other jurisdiction of	(IRS Employer Identification
incorporation or organization)	Number)

1293 South Main Street
Akron, Ohio	44301
(Address of principal executive offices)	(Zip code)

Title of Each Class		Trading Symbol		Name of Exchange on Which Registered
Common Stock, without par value		MYE		New York Stock Exchange

Part I — Financial Information
	��
~~Item 1. Financial Statements~~

~~Condensed Consolidated Statements of Operations (Unaudited)~~	1

Item 1. Financial Statements	1

Condensed Consolidated Statements of Operations (Unaudited)	1

Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited)	2

Condensed Consolidated Statements of Financial Position (Unaudited)	3

Condensed Consolidated Statements of Shareholders’ Equity (Unaudited)	4

Condensed Consolidated Statements of Cash Flows (Unaudited)	6

Notes to Unaudited Condensed Consolidated Financial Statements	7

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	2321

Item 3. Quantitative and Qualitative Disclosures About Market Risk	27

Item 4. Controls and Procedures	27

Part II — Other Information	28

Item 1. Legal Proceedings	28
Item 1A. Risk Factors	28

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	28

Item 6. Exhibits	29

~~Item 4. Controls and Procedures~~Signature	30

~~Part II — Other Information~~	31

~~Item 1. Legal Proceedings~~	31

~~Item 2. Unregistered Sales of Equity Securities and Use of Proceeds~~	31

~~Item 6. Exhibits~~	31

~~Signatures~~	32

Exhibit 31.1
Exhibit 31.2
Exhibit 32.1
Exhibit 101

	2020
Balance at January 1	$	1,356
Provision for expected credit loss, net of recoveries		447
Write-offs and other		(286	)
Balance at June 30	$	1,517

Assets acquired:
Accounts receivable	$	2,105
Inventories		2,719
Prepaid expenses		43
Property, plant and equipment		124
Right of use asset - operating leases		229
Intangible assets		8,400
Goodwill		7,143
Assets acquired	$	20,763

Liabilities assumed:
Accounts payable	$	1,675
Accrued expenses		143
Operating lease liability - short term		112
Operating lease liability - long term		117
Total liabilities assumed		2,047

Net acquisition cost	$	18,716




☑	Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934




☐	Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Large accelerated filer	☐	Accelerated filer	☑
Non-Accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

	For the Quarter Ended June 30, 2019
	As Reported			Adjustments			Balances Without Adoption of ASC 842
Net sales	$	134,285		$	—		$	134,285
Cost of sales		87,349			—			87,349
Gross profit		46,936			—			46,936
Selling, general and administrative expenses		36,809			(34	)		36,775
(Gain) loss on disposal of fixed assets		(55	)		—			(55	)
Operating income		10,182			34			10,216
Interest expense, net		1,017			—			1,017
Income from continuing operations before income taxes		9,165			34			9,199
Income tax expense		2,559			9			2,568
Income from continuing operations	$	6,606		$	25		$	6,631

	For the Six Months Ended June 30, 2019
	As Reported			Adjustments			Balances Without Adoption of ASC 842
Net sales	$	273,400		$	—		$	273,400
Cost of sales		180,905			—			180,905
Gross profit		92,495			—			92,495
Selling, general and administrative expenses		71,277			(67	)		71,210
(Gain) loss on disposal of fixed assets		(98	)		—			(98	)
Impairment charges		916			—			916
Operating income		20,400			67			20,467
Interest expense, net		2,066			—			2,066
Income from continuing operations before income taxes		18,334			67			18,401
Income tax expense		5,085			18			5,103
Income from continuing operations	$	13,249		$	49		$	13,298

	As of June 30, 2019
	As Reported			Adjustments			Balances Without Adoption of ASC 842
Assets
Right of use asset - operating leases	$	5,983		$	(5,983	)	$	—
Deferred tax asset		6,490			316			6,806

Liabilities
Other current liabilities	$	14,639		$	242		$	14,881
Operating lease liability - short-term		2,000			(2,000	)		—
Operating lease liability - long-term		4,225			(4,225	)		—
Other liabilities		22,813			1,169			23,982

Shareholders’ Equity
Retained deficit	$	(136,557	)	$	(853	)	$	(137,410	)

	Foreign Currency			Defined Benefit Pension Plans			Total			Foreign Currency			Defined Benefit Pension Plans			Total
Balance at January 1, 2019	$	(16,251	)	$	(2,029	)	$	(18,280	)
Balance at January 1, 2020										$	(14,602	)	$	(1,747	)	$	(16,349	)
Other comprehensive income (loss) before reclassifications		1,535			—			1,535			(1,535	)		—			(1,535	)
Net current-period other comprehensive income (loss)		1,535			—			1,535			(1,535	)		—			(1,535	)
Balance at June 30, 2019	$	(14,716	)	$	(2,029	)	$	(16,745	)
Balance at June 30, 2020										$	(16,137	)	$	(1,747	)	$	(17,884	)


	For the Quarter Ended June 30, 2020
	Material Handling		Distribution		Inter-company			Consolidated
Consumer	$	31,211	$	—	$	—		$	31,211
Vehicle		13,813		—		—			13,813
Food and beverage		9,072		—		—			9,072
Industrial		26,759		—		(2	)		26,757
Auto aftermarket		—		37,541		—			37,541
Total net sales	$	80,855	$	37,541	$	(2	)	$	118,394

	For the Quarter Ended June 30, 2018
	Material Handling		Distribution		Inter-company			Consolidated
Consumer	$	27,046	$	—	$	—		$	27,046
Vehicle		26,758		—		—			26,758
Food and beverage		15,308		—		—			15,308
Industrial		34,018		—		(47	)		33,971
Auto aftermarket		—		37,477		—			37,477
Total net sales	$	103,130	$	37,477	$	(47	)	$	140,560

	June 30,			December 31,			Statement of Financial Position	June 30,			December 31,			Statement of Financial Position
	2019			2018			Classification	2020			2019			Classification
Returns, discounts and other allowances	$	(606	)	$	(1,169	)	Accounts receivable	$	(1,025	)	$	(589	)	Accounts receivable
Right of return asset		322			535		Inventories, net		377			312		Inventories, net
Customer deposits		(115	)		(806	)	Other current liabilities		(19	)		(269	)	Other current liabilities
Accrued rebates		(2,023	)		(2,559	)	Other current liabilities		(3,174	)		(2,349	)	Other current liabilities

	Fair Value		Weighted Average Estimated Useful Life
Customer relationships	$	7,300	7.3 years
Trade name		500	5.0 years
Non-competition agreements		600	5.0 years
Total amortizable intangible assets	$	8,400

	Employee Reduction			Accelerated Depreciation		Other Exit Costs		Total
Balance at January 1, 2019	$	30		$	—	$	—	$	30
Charges to expense		901			—		—		901
Cash payments		(582	)		—		—		(582	)
Non-cash utilization		—			—		—		—
Balance at June 30, 2019	$	349		$	—	$	—	$	349

			June 30,		December 31,
	June 30, 2019		2020		2019
Right of use asset - operating leases	$	5,983	$	4,801	$	5,901

Operating lease liability - short-term	$	2,000	$	1,546	$	2,057
Operating lease liability - long-term		4,225		3,478		4,074
Total operating lease liabilities	$	6,225	$	5,024	$	6,131

		Quarter Ended		Six Months Ended
Lease Cost	Classification	June 30, 2019		June 30, 2019
Operating lease cost ⁽¹⁾	Cost of sales	$	442	$	857
Operating lease cost ⁽¹⁾	Selling, general and administrative expenses		426		897
Total lease cost		$	868	$	1,754

	Six Months Ended		For the Six Months Ended June 30,
Supplemental Cash Flow Information	June 30, 2019		2020		2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	1,149	$	1,244	$	1,149
Right-of-use assets obtained in exchange for new lease liabilities:
Operating leases		1,037	$	—	$	1,037

Lease Term and Discount Rate	June 30, 2020			December 31, 2019
Weighted-average remaining lease term (years):
Operating leases		4.13			4.23
Weighted-average discount rate:
Operating leases		5.0	%		5.0	%

Maturity of Lease Liabilities - As of June 30, 2020	Operating Leases
2020 ⁽¹⁾	$	1,060
2021		1,339
2022		1,189
2023		1,016
2024		339
After 2024		621
Total lease payments		5,564
Less: Interest		(540	)
Present value of lease liabilities	$	5,024

~~Lease Term and Discount Rate~~	~~June 30, 2019~~
~~Weighted-average remaining lease term (years)~~
~~Operating leases~~		~~4.53~~
~~Weighted-average discount rate~~
~~Operating leases~~		~~5.0~~	%

Maturity of Lease Liabilities - As of June 30, 2019	Operating Leases
2019 ⁽¹⁾	$	1,203
2020		1,805
2021		1,107
2022		1,051
2023		906
After 2023		897
Total lease payments		6,969
Less: Interest		(744	)
Present value of lease liabilities	$	6,225

Year Ended December 31,
2019	$	2,492
2020		1,739
2021		982
2022		966
2023		841
Thereafter		811
Total	$	7,831

(dollars in millions)	Quarter Ended June 30,										Quarter Ended June 30,
Segment	2019		2018		Change			% Change			2020		2019		Change			% Change
Material Handling	$	95.9	$	103.1	$	(7.2	)		(7	)%	$	80.9	$	95.9	$	(15.0	)		(16	)%
Distribution		38.4		37.5		0.9			2	%		37.5		38.4		(0.9	)		(2	)%
Inter-company sales		—		—		—						—		—		—
Total net sales	$	134.3	$	140.6	$	(6.3	)		(4	)%	$	118.4	$	134.3	$	(15.9	)		(12	)%

(dollars in millions)	Six Months Ended June 30,
Segment	2020		2019		Change			% Change
Material Handling	$	164.9	$	198.8	$	(33.9	)		(17	)%
Distribution		75.7		74.6		1.1			1	%
Inter-company elimination		—		—		—
Total net sales	$	240.6	$	273.4	$	(32.8	)		(12	)%

	Required Level	Actual Level
Interest Coverage Ratio	3.00 to 1 (minimum)		~~14.42~~13.47
Leverage Ratio	3.25 to 1 (maximum)		~~1.18~~1.27

	Total Number of Shares Purchased		Average Price Paid per Share		Total Number of Shares Purchased as Part of the Publicly Announced Plans or Programs		Maximum number of Shares that may yet be Purchased Under the Plans or Programs (1)
4/1/2019 to 4/30/2019		—	$	—		5,547,665		2,452,335
5/1/2019 to 5/31/2019		—		—		5,547,665		2,452,335
6/1/2019 to 6/30/2019		—		—		5,547,665		2,452,335

3(a)		Myers Industries, Inc. Amended and Restated Articles of Incorporation. Reference is made to Exhibit 3(a) to Form 10-K filed with the Commission on March 16, 2005.
3(b)		Myers Industries, Inc. Amended and Restated Code of Regulations. Reference is made to Exhibit 3.1 to Form 8-K filed with the Commission on April ~~12, 2013.~~30, 2020.
10(a)		Form of 2020 Restricted Stock Unit Award Agreement under the Amended and Restated 2017 Incentive Stock Plan of Myers Industries, Inc.* (filed herewith)
10(b)		Form of 2020 Performance Stock Unit Award Agreement under the Amended and Restated 2017 Incentive Stock Plan of Myers Industries, Inc.* (filed herewith)
31.1		Certification of ~~R. David Banyard,~~Michael P. McGaugh, President and Chief Executive Officer of Myers Industries, Inc., pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2		Certification of Kevin L. Brackman, Executive Vice President and Chief Financial Officer of Myers Industries, Inc., pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1		Certifications of ~~R. David Banyard,~~Michael P. McGaugh, President and Chief Executive Officer, and Kevin L. Brackman, Executive Vice President and Chief Financial Officer, of Myers Industries, Inc. pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101		The following financial information from Myers Industries, Inc. Quarterly Report on Form 10-Q for the quarterly period ended June 30, ~~2019,~~2020, formatted in inline XBRL includes: (i) Condensed Consolidated Statements of Operations, (ii) Condensed Consolidated Statements of Comprehensive Income (Loss), (iii) Condensed Consolidated Statements of Financial Position, (iv) Condensed Consolidated Statements of Shareholders' Equity, (v) Condensed Consolidated Statements of Cash Flows and (vi) the Notes to Condensed Consolidated Financial Statements.
104		Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101).


	MYERS INDUSTRIES, INC.

~~August 2, 2019~~July 30, 2020	/s/ Kevin L. Brackman
	Kevin L. Brackman
	Executive Vice President and Chief Financial Officer (Principal Financial and Accounting Officer)