| Preliminary Proxy Statement | | | ☐ Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) | |
| Definitive Proxy Statement | | | ||
| ☐ Definitive Additional Materials | | | ||
| ☐ Soliciting Material Pursuant to §240.14a-12 | | |
| Sincerely, | | | ||
| James S. Metcalf Chairman of the NCI Board | | | Donald R. Riley President and Chief Executive Officer | |
| | | | | 1 | | | |
| | | | | 7 | | | |
| | | | | 25 | | | |
| | | | | 25 | | | |
| | | | | 28 | | | |
| | | | | 32 | | | |
| | | | | 32 | | | |
| | | | | 38 | | | |
| | | | | 40 | | | |
| | | | | 40 | | | |
| | | | | 40 | | | |
| | | | | 41 | | | |
| | | | | 41 | | | |
| | | | | 41 | | | |
| | | | | 41 | | | |
| | | | | 41 | | | |
| | | | | 42 | | | |
| | | | | 42 | | | |
| | | | | 42 | | | |
| | | | | 42 | | | |
| | | | | 42 | | | |
| | | | | 43 | | | |
| | | | | 43 | | | |
| | | | | 44 | | | |
| | | | | 44 | | | |
| | | | | 45 | | | |
| | | | | 45 | | | |
| | | | | 45 | | | |
| | | | | 45 | | | |
| | | | | 45 | | | |
| | | | | 45 | | | |
| | | | | 46 | | | |
| | | | | 47 | | | |
| | | | | 47 | | | |
| | | | | 47 | | | |
| | | | | 47 | | | |
| | | | | 54 | | | |
| | | | | 57 | | |
| | | | | 59 | | | |
| | | | | 70 | | | |
| | | | | 75 | | | |
| | | | | 76 | | | |
| | | | | 77 | | | |
| | | | | 77 | | | |
| | | | | | | ||
| | | | | 78 | | | |
| | | | | 78 | | | |
| | | | | 78 | | | |
| | | | | 78 | | | |
| | | | | 79 | | | |
| | | | | 79 | | | |
| | | | | 79 | | | |
| | | | | 80 | | | |
| | | | | 82 | | | |
| | | | | 86 | | | |
| | | | | 87 | | | |
| | | | | 88 | | | |
| | | | | 89 | | | |
| | | | | 89 | | | |
| | | | | 90 | | | |
| | | | | 90 | | | |
| | | | | 91 | | | |
| | | | | 92 | | | |
| | | | | 92 | | | |
| | | | | 93 | | | |
| | | | | 93 | | | |
| | | | | 93 | | | |
| | | | | 93 | | | |
| | | | | 94 | | | |
| | | | | 94 | | | |
| | | | | 96 | | | |
| | | | | 97 | | | |
| | | | | 98 | | | |
| | | | | 99 | | | |
| | | | | 100 | | | |
| | | | | 101 | | | |
| | | | | 101 | | | |
| | | | | 101 | | | |
| | | | | 102 | | | |
| | | | | 102 | | |
| | | | | 103 | | | |
| | | | | 103 | | | |
| | | | | 104 | | | |
| | | | | 104 | | | |
| | | | | 104 | | | |
| | | | | 104 | | | |
| | | | | 105 | | | |
| | | | | 105 | | | |
| | | | | 106 | | | |
| | | | | 106 | | | |
| | | | | 106 | | | |
| | | | 106 | | | ||
| | | | | 107 | | | |
| | | | | 107 | | | |
| | | | | 108 | | | |
| | | | | 108 | | | |
| | | | | 109 | | | |
| | | | | 111 | | | |
| | | | | 112 | | | |
| | | | | 113 | | | |
| | | | | 114 | | | |
| | | | | 130 | | | |
| | | | | 130 | | | |
| | | | | 130 | | | |
| | | | | 131 | | | |
| | | | | 132 | | | |
| | | | | 134 | | | |
| | | | | 137 | | | |
| | | | | 138 | | | |
| | | | | 139 | | |
| | | As of or for the nine months ended | | | Year ended | | | | | | | | | ||||||||||||||||||||||||||||||||||||||||||||
| | | July 29, 2018 | | | October 29, 2017 | | | October 30, 2016 | | | November 1, 2015 | | | November 2, 2014 | | | November 3, 2013(6) | | | | | | | | | ||||||||||||||||||||||||||||||||
| | | (Unaudited) | | | (Audited) | | | | | | | | | ||||||||||||||||||||||||||||||||||||||||||||
| | | (In thousands, except per share data) | | | | | | | | | |||||||||||||||||||||||||||||||||||||||||||||||
Sales | | | | $ | 1,426,943 | | | | | $ | 1,770,278 | | | | | $ | 1,684,928 | | | | | $ | 1,563,693 | | | | | $ | 1,370,540 | | | | | $ | 1,308,395 | | | | | | | | | | ||||||||||||||
Net income (loss) | | | | $ | 35,551(1) | | | | | $ | 54,724(2) | | | | | $ | 51,027(3) | | | | | $ | 17,818(4) | | | | | $ | 11,185(5) | | | | | $ | (12,885)(7) | | | | | | | | | | ||||||||||||||
Net income (loss) applicable to common shares | | | | $ | 35,303(1) | | | | | $ | 54,399(2) | | | | | $ | 50,638(3) | | | | | $ | 17,646(4) | | | | | $ | 11,085(5) | | | | | $ | (12,885)(7) | | | | | | | | | | ||||||||||||||
Earnings (loss) per common share: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||||||||
Basic | | | | $ | 0.53 | | | | | $ | 0.77 | | | | | $ | 0.70 | | | | | $ | 0.24 | | | | | $ | 0.15 | | | | | $ | (0.29) | | | | | | | | | | ||||||||||||||
Diluted | | | | $ | 0.53(1) | | | | | $ | 0.77(2) | | | | | $ | 0.70(3) | | | | | $ | 0.24(4) | | | | | $ | 0.15(5) | | | | | $ | (0.29)(7) | | | | | | | | | | ||||||||||||||
Cash flow from operating activities | | | | $ | 56,908 | | | | | $ | 63,874 | | | | | $ | 68,479 | | | | | $ | 105,785 | | | | | $ | 34,104 | | | | | $ | 65,119 | | | | | | | | | | ||||||||||||||
Total assets | | | | $ | 1,081,694 | | | | | $ | 1,031,112 | | | | | $ | 1,025,396 | | | | | $ | 1,049,317 | | | | | $ | 739,025 | | | | | $ | 750,489 | | | | | | | | | | ||||||||||||||
Total debt | | | | $ | 407,992 | | | | | $ | 387,290 | | | | | $ | 396,051 | | | | | $ | 434,542 | | | | | $ | 233,709 | | | | | $ | 235,737 | | | | | | | | | | ||||||||||||||
Stockholders’ equity | | | | $ | 299,086 | | | | | $ | 305,247 | | | | | $ | 281,317 | | | | | $ | 271,976 | | | | | $ | 246,542 | | | | | $ | 252,758 | | | | | | | | | | ||||||||||||||
Diluted average common shares | | | | | 66,477 | | | | | | 70,778 | | | | | | 72,857 | | | | | | 73,923 | | | | | | 74,709 | | | | | | 44,761(8) | | | | | | | | | | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Successor | | | Predecessor | | | Ply Gem Holdings Predecessor | | |||||||||||||||||||||
| | | As of and for the period from April 13, 2018 to June 30, 2018 | | | As of and for the period from January 1, 2018 to April 12, 2018 | | | Year ended December 31, | | |||||||||||||||||||||
| | | 2017 | | | 2016 | | | 2015(1) | | |||||||||||||||||||||
(Amounts in thousands, except per share data) | | | (Unaudited) | | | (Audited) | | ||||||||||||||||||||||||
Statement of operations data: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net sales | | | | $ | 597,936 | | | | | $ | 529,643 | | | | | $ | 2,056,303 | | | | | $ | 1,911,844 | | | | | $ | 1,839,726 | | |
Cost of products sold | | | | | 479,402 | | | | | | 426,674 | | | | | | 1,587,790 | | | | | | 1,449,570 | | | | | | 1,420,014 | | |
Gross profit | | | | | 118,534 | | | | | | 102,969 | | | | | | 468,513 | | | | | | 462,274 | | | | | | 419,712 | | |
Operating expenses: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Selling, general and administrative expenses | | | | | 69,812 | | | | | | 81,364 | | | | | | 272,984 | | | | | | 268,714 | | | | | | 271,874 | | |
Acquisition related expenses | | | | | 11,186 | | | | | | 67,802 | | | | | | — | | | | | | — | | | | | | — | | |
Amortization of intangible assets | | | | | 24,096 | | | | | | 6,105 | | | | | | 21,271 | | | | | | 25,064 | | | | | | 25,306 | | |
Total operating expenses | | | | | 105,094 | | | | | | 155,271 | | | | | | 294,255 | | | | | | 293,778 | | | | | | 297,180 | | |
Operating earnings | | | | | 13,440 | | | | | | (52,302) | | | | | | 174,258 | | | | | | 168,496 | | | | | | 122,532 | | |
Foreign currency gain (loss) | | | | | (1,516) | | | | | | (132) | | | | | | 1,363 | | | | | | 299 | | | | | | (3,166) | | |
Interest expense | | | | | (43,787) | | | | | | (19,054) | | | | | | (69,361) | | | | | | (72,718) | | | | | | (74,876) | | |
Interest income | | | | | 24 | | | | | | 22 | | | | | | 78 | | | | | | 36 | | | | | | 57 | | |
Tax receivable agreement liability adjustment | | | | | — | | | | | | (5,237) | | | | | | 10,749 | | | | | | (60,874) | | | | | | (12,947) | | |
Loss on modification or extinguishment of debt | | | | | — | | | | | | — | | | | | | (2,106) | | | | | | (11,747) | | | | | | — | | |
Income (loss) before benefit from income taxes | | | | | (31,839) | | | | | | (76,703) | | | | | | 114,981 | | | | | | 23,492 | | | | | | 31,600 | | |
Provision (Benefit) from income taxes | | | | | (11,428) | | | | | | (9,923) | | | | | | 46,654 | | | | | | (51,995) | | | | | | (688) | | |
Net income (loss) | | | | $ | (20,411) | | | | | $ | (66,780) | | | | | $ | 68,327 | | | | | $ | 75,487 | | | | | $ | 32,288 | | |
|
| | | Successor | | | Predecessor | | | Ply Gem Holdings Predecessor | | |||||||||||||||||||||
| | | As of and for the period from April 13, 2018 to June 30, 2018 | | | As of and for the period from January 1, 2018 to April 12, 2018 | | | Year ended December 31, | | |||||||||||||||||||||
| | | 2017 | | | 2016 | | | 2015(1) | | |||||||||||||||||||||
(Amounts in thousands, except per share data) | | | (Unaudited) | | | (Audited) | | ||||||||||||||||||||||||
Per basic common share: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net income (loss) applicable to common shares | | | | $ | (3.20) | | | | | $ | (0.97) | | | | | $ | 1.00 | | | | | $ | 1.11 | | | | | $ | 0.47 | | |
Per diluted common share: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net income (loss) applicable to common shares | | | | $ | (3.20) | | | | | $ | (0.97) | | | | | $ | 0.99 | | | | | $ | 1.10 | | | | | $ | 0.47 | | |
Total assets(2) | | | | $ | 3,886,246 | | | | | | N/A | | | | | $ | 1,319,567 | | | | | $ | 1,257,741(3) | | | | | $ | 1,266,572 | | |
Long-term debt, less current maturities(2) | | | | $ | 2,434,598 | | | | | | N/A | | | | | $ | 807,334 | | | | | $ | 836,086 | | | | | $ | 975,531 | | |
(Amounts in thousands, except per share data) | | | As of and for the three months ended March 31, 2018 | | | Year ended December 31, | | ||||||||||||||||||
| 2017 | | | 2016 | | | 2015 | | |||||||||||||||||
| (Unaudited) | | | (Audited) | | ||||||||||||||||||||
Statement of operations data: | | | | | | | | | | | | | | | | | | | | | | | | | |
Net sales | | | | $ | 72,369 | | | | | $ | 348,844 | | | | | $ | 312,628 | | | | | $ | 300,453 | | |
Cost of goods sold | | | | | 50,873 | | | | | | 234,451 | | | | | | 214,688 | | | | | | 201,015 | | |
Gross profit | | | | | 21,496 | | | | | | 114,393 | | | | | | 97,940 | | | | | | 99,438 | | |
Operating expenses: | | | | | | | | | | | | | | | | | | | | | | | | | |
Selling, delivery, general and administrative expenses | | | | | 16,694 | | | | | | 67,572 | | | | | | 63,364 | | | | | | 63,841 | | |
Amortization expense | | | | | 1,722 | | | | | | 6,723 | | | | | | 6,231 | | | | | | 6,432 | | |
Stock compensation expense | | | | | — | | | | | | 1 | | | | | | 11 | | | | | | 11 | | |
Total selling, delivery, general and administrative expenses | | | | | 18,416 | | | | | | 74,296 | | | | | | 69,606 | | | | | | 70,284 | | |
Impairment of trade name | | | | | — | | | | | | 1,560 | | | | | | 200 | | | | | | — | | |
Impaiment of goodwill and other intangible assets | | | | | — | | | | | | — | | | | | | — | | | | | | 300 | | |
Loss on disposal of assets, net | | | | | — | | | | | | (239) | | | | | | 288 | | | | | | 6 | | |
Total operating expenses | | | | | 18,416 | | | | | | 75,617 | | | | | | 70,094 | | | | | | 70,590 | | |
Operating income from continuing operations | | | | | 3,080 | | | | | | 38,776 | | | | | | 27,846 | | | | | | 28,848 | | |
Interest expense | | | | | 9,050 | | | | | | 35,903 | | | | | | 42,479 | | | | | | 39,804 | | |
Other expense (income), net | | | | | 61 | | | | | | 226 | | | | | | 546 | | | | | | (519) | | |
Income (loss) from continuing operations before income taxes | | | | | (6,031) | | | | | | 2,647 | | | | | | (15,179) | | | | | | (10,437) | | |
Income tax expense | | | | | (464) | | | | | | 1,521 | | | | | | 1,320 | | | | | | 2,229 | | |
Loss from continuing operations | | | | | (5,567) | | | | | | 1,126 | | | | | | (16,499) | | | | | | (12,666) | | |
Loss from discontinued operations, net of tax | | | | | (436) | | | | | | (1,148) | | | | | | (8,173) | | | | | | (13,402) | | |
Net (loss) | | | | $ | (6,003) | | | | | $ | (22) | | | | | $ | (24,672) | | | | | $ | (26,068) | | |
Total assets | | | | $ | 213,690 | | | | | $ | 213,630 | | | | | $ | 203,444 | | | | | $ | 214,829 | | |
Long-term debt, less current maturities | | | | $ | 302,549 | | | | | $ | 301,974 | | | | | $ | 299,543 | | | | | $ | 311,814 | | |
Long term debt due to related party | | | | $ | 79,709 | | | | | $ | 77,326 | | | | | $ | 68,371 | | | | | $ | 53,556 | | |
| | | Pro Forma | | |||
(in thousands) | | | As of July 29, 2018 | | |||
Assets | | | |||||
Current assets: | | | |||||
Cash and cash equivalents | | | | | 140,508 | | |
Restricted cash | | | | | 180 | | |
Accounts receivable, net | | | | | 551,205 | | |
Inventories, net | | | | | 517,104 | | |
Income taxes receivable | | | | | 1,171 | | |
Investments in debt and equity securities, at market | | | | | 5,785 | | |
Prepaid expenses and other current assets | | | | | 61,823 | | |
Assets held for sale | | | | | 7,272 | | |
Total current assets | | | | | 1,285,048 | | |
Property and equipment, net | | | | | 534,540 | | |
Other assets: | | | |||||
Goodwill | | | | | | | |
Intangible assets, net | | | | | 1,792,085 | | |
Deferred income tax assets | | | | | 1,701 | | |
Other assets, net | | | | | 19,610 | | |
Total other assets | | | | | | | |
Total assets | | | | | | | |
Liabilities | | | |||||
Current liabilities: | | | |||||
Notes payable | | | | | 994 | | |
Accounts payable | | | | | 293,493 | | |
Accrued compensation and benefits | | | | | 81,077 | | |
Accrued interest | | | | | 35,659 | | |
Other accrued expenses | | | | | 318,107 | | |
Accrued expenses | | | | | — | | |
Current portion of payable to related parties pursuant to tax receivable agreement | | | | | 24,894 | | |
Current portion of long-term debt | | | | | 22,300 | | |
Accrued income taxes | | | | | 7,925 | | |
Total current liabilities | | | | | 784,449 | | |
Long-term debt, net of deferred financing costs | | | | | 2,892,973 | | |
Deferred income taxes | | | | | 334,253 | | |
Long-term portion of payable to related parties pursuant to tax receivable agreement | | | | | 23,362 | | |
Other long-term liabilities | | | | | 109,187 | | |
Total long-term liabilities | | | | | 3,359,775 | | |
Total liabilities | | | | | 4,144,224 | | |
Stockholders’ Equity | | | |||||
Common stock | | | | | 1,257 | | |
Additional paid-in capital | | | | | | | |
Accumulated deficit | | | | | (249,963) | | |
Accumulated other comprehensive loss | | | | | (7,623) | | |
Treasury stock, at cost | | | | | (1,167) | | |
Total stockholders’ equity | | | | | | | |
Total liabilities and stockholders’ equity | | | | | | | |
|
| | | Pro Forma | | |||||||||
(in thousands, except for per share data) | | | For the nine months ended July 29, 2018 | | | For the year ended October 29, 2017 | | ||||||
Revenue | | | | | | | | | | | | | |
Net sales | | | | | 3,248,501 | | | | | | 4,175,425 | | |
Cost of sales | | | | | 2,540,218 | | | | | | 3,194,568 | | |
Loss (gain) on sale of assets and asset recovery | | | | | — | | | | | | 137 | | |
Gross profit | | | | | 708,283 | | | | | | 980,720 | | |
Engineering, selling, general and administrative expenses | | | | | 470,308 | | | | | | 608,817 | | |
Intangible asset amortization | | | | | 91,717 | | | | | | 122,260 | | |
Goodwill impairment | | | | | — | | | | | | 6,000 | | |
Strategic development and acquisition related costs | | | | | 5,503 | | | | | | 1,971 | | |
Restructuring and impairment charges | | | | | 1,143 | | | | | | 5,297 | | |
Gain on insurance recovery | | | | | (4,741) | | | | | | (9,749) | | |
Loss on disposition of business | | | | | 5,673 | | | | | | — | | |
Operating Earnings | | | | | 138,680 | | | | | | 246,124 | | |
Interest income | | | | | 236 | | | | | | 335 | | |
Interest expense | | | | | (152,684) | | | | | | (203,886) | | |
Foreign currency gain (loss) | | | | | (2,196) | | | | | | 1,864 | | |
Other income, net | | | | | 1,072 | | | | | | 1,472 | | |
Loss on extinguishment of debt | | | | | (21,875) | | | | | | — | | |
Tax receivable agreement liability adjustment | | | | | 5,512 | | | | | | 10,749 | | |
Income (loss) before income taxes | | | | | (31,255) | | | | | | 56,658 | | |
(Benefit) provision for income taxes | | | | | 8,193 | | | | | | 20,063 | | |
Net income (loss) from continuing operations | | | | | (39,448) | | | | | | 36,595 | | |
Net income allocated to participating securities | | | | | (248) | | | | | | (325) | | |
Net income (loss) applicable to common shares | | | | | (39,696) | | | | | | 36,270 | | |
Income (loss) per common share: | | | | | | | | | | | | | |
Basic | | | | $ | (0.32) | | | | | $ | 0.28 | | |
Diluted | | | | $ | (0.32) | | | | | $ | 0.28 | | |
Weighted average number of common shares outstanding: | | | | | | | | | | | | | |
Basic | | | | | 125,756 | | | | | | 130,024 | | |
Diluted | | | | | 125,872 | | | | | | 130,173 | | |
| | As of and for the nine months ended July 29, 2018 | | As of and for the six months ended June 30, 2018 | | As of and for the nine months ended July 29, 2018 | | As of and for the year ended October 29, 2017 | | As of and for the year ended December 31, 2017 | | As of and for the year ended October 29, 2017 | | | As of and for the nine months ended July 29, 2018 | | As of and for the six months ended June 30, 2018 | | As of and for the nine months ended July 29, 2018 | | As of and for the year ended October 29, 2017 | | As of and for the year ended December 31, 2017 | | As of and for the year ended October 29, 2017 | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(in thousands, except for per share data) | | Historical NCI | | Historical Ply Gem (successor) April 13, 2018 – June 30, 2018 | | Historical Ply Gem Holdings (predecessor) January 1, 2018 – April 12, 2018 | | Historical Atrium | | Pro Forma(1) | | Historical NCI | | Historical Ply Gem Holdings | | Historical Atrium | | Pro Forma(1) | | | Historical NCI | | Historical Ply Gem (successor) April 13, 2018 – June 30, 2018 | | Historical Ply Gem Holdings (predecessor) January 1, 2018 – April 12, 2018 | | Historical Atrium | | Pro Forma(1) | | Historical NCI | | Historical Ply Gem Holdings | | Historical Atrium | | Pro Forma(1) | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income per common share – basic | | | $ | 0.53 | | | Note 1 | | Note 1 | | Note 3 | | | $ | (0.32) | | | | $ | 0.77 | | | | $ | 1.00 | | | | $ | (0.00) | | | | $ | 0.28 | | | | | $ | 0.53 | | | Note 1 | | Note 1 | | Note 3 | | | $ | (0.32) | | | | $ | 0.77 | | | | $ | 1.00 | | | | $ | (0.00) | | | | $ | 0.28 | | | ||||||||||||||||||||||||||||||||||||
Income per common share – diluted | | | $ | 0.53 | | | Note 1 | | Note 1 | | Note 3 | | | $ | (0.32) | | | | $ | 0.77 | | | | $ | 0.99 | | | | $ | (0.00) | | | | $ | 0.28 | | | | | $ | 0.53 | | | Note 1 | | Note 1 | | Note 3 | | | $ | (0.32) | | | | $ | 0.77 | | | | $ | 0.99 | | | | $ | (0.00) | | | | $ | 0.28 | | | ||||||||||||||||||||||||||||||||||||
Weighted average number of common shares outstanding – basic | | | | 66,361 | | | | | 6,380 | | | | | 68,558 | | | Note 4 | | | | 125,756 | | | | | 70,629 | | | | | 68,443 | | | | | 2,010 | | | | | 130,024 | | | | | | 66,361 | | | | | 6,380 | | | | | 68,558 | | | Note 4 | | | | 125,756 | | | | | 70,629 | | | | | 68,443 | | | | | 2,010 | | | | | 130,024 | | | ||||||||||||||||||||||||
Weighted average number of common shares outstanding – diluted | | | | 66,477 | | | | | 6,380 | | | | | 68,558 | | | Note 4 | | | | 125,872 | | | | | 70,778 | | | | | 69,007 | | | | | 2,010 | | | | | 130,173 | | | | | | 66,477 | | | | | 6,380 | | | | | 68,558 | | | Note 4 | | | | 125,872 | | | | | 70,778 | | | | | 69,007 | | | | | 2,010 | | | | | 130,173 | | | ||||||||||||||||||||||||
Book value per share of common stock | | | $ | 4.52 | | | | $ | 0.10 | | | Note 2 | | Note 5 | | | $ | 9.80 | | | | $ | 4.46 | | | | $ | 1.20 | | | | $ | (113.23) | | | | | | | | | | $ | 4.52 | | | | $ | 0.10 | | | Note 2 | | Note 5 | | | $ | 9.41 | | | | $ | 4.46 | | | | $ | 1.20 | | | | $ | (113.23) | | | | | | | | ||||||||||||||||||||||||||||||
Dividends declared per share of common stock | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | |
| | | | | | Initial Case | | | Evaluated Case | | ||||||||||||||||||||||||||||||
| | | | | | 2018E | | | 2019E | | | 2020E | | | 2018E | | | 2019E | | | 2020E | | ||||||||||||||||||
Ply Gem | | | Revenue | | | | $ | 2,651* | | | | | $ | 2,841 | | | | | $ | 3,054 | | | | | $ | 2,649 | | | | | $ | 2,901 | | | | | $ | 3,148 | | |
| | | EBITDA | | | | $ | 355 | | | | | $ | 418 | | | | | $ | 485 | | | | | $ | 339 | | | | | $ | 410 | | | | | $ | 471 | | |
NCI | | | Revenue | | | | $ | 1,866 | | | | | $ | 1,959 | | | | | $ | 2,076 | | | | | $ | 1,950 | | | | | $ | 2,011 | | | | | $ | 2,108 | | |
| | | EBITDA | | | | $ | 199 | | | | | $ | 240 | | | | | $ | 290 | | | | | $ | 199 | | | | | $ | 231 | | | | | $ | 260 | | |
Prospective | | | Revenue | | | | $ | 4,517 | | | | | $ | 4,800 | | | | | $ | 5,130 | | | | | $ | 4,599 | | | | | $ | 4,911 | | | | | $ | 5,256 | | |
Operating | | | EBITDA (Pre-Synergies) | | | | $ | 554 | | | | | $ | 659 | | | | | $ | 774 | | | | | $ | 538 | | | | | $ | 640 | | | | | $ | 731 | | |
Projections | | | EBITDA (Post-Synergies) | | | | $ | 554 | | | | | $ | 694 | | | | | $ | 844 | | | | | $ | 538 | | | | | $ | 657 | | | | | $ | 766 | | |
Sector | | | Selected Public Company | | | TEV/ NTM EBITDA | | | TEV/ 2019E EBITDA | |
Windows, Doors & Siding Company | | | James Hardie Industries plc | | | 13.2x | | | 11.9x | |
Windows, Doors & Siding Company | | | PGT Innovations, Inc. | | | 11.9x | | | 11.4x | |
Windows, Doors & Siding Company | | | Masonite International Corporation | | | 8.9x | | | 8.4x | |
Windows, Doors & Siding Company | | | Quanex Building Products Corporation | | | 7.8x | | | 7.7x | |
Windows, Doors & Siding Company | | | JELD-WEN Holding, Inc. | | | 7.7x | | | 7.2x | |
Other Building Product Companies | | | Other Companies (Aggregated)(1) | | | 9.2x | | | 8.8x | |
Sector | | | Selected Public Company | | | TEV/ NTM EBITDA | | | TEV/ 2019E EBITDA | |
Select Building Product Company | | | Kingspan Group plc | | | 16.1x | | | 15.4x | |
Select Building Product Company | | | Simpson Manufacturing Co., Inc. | | | 12.2x | | | 11.3x | |
Select Building Product Company | | | Armstrong World Industries, Inc. | | | 11.5x | | | 11.1x | |
Select Building Product Company | | | USG Corporation | | | 10.4x | | | 9.8x | |
Select Building Product Company | | | Gibraltar Industries, Inc. | | | 9.3x | | | 8.8x | |
Select Building Product Company | | | Apogee Enterprises, Inc. | | | 8.3x | | | 7.7x | |
Select Building Product Company | | | Owens Corning | | | 7.2x | | | 6.9x | |
Metal Fabrication Company | | | Steel Dynamics, Inc. | | | 6.4x | | | 6.7x | |
Metal Fabrication Company | | | Nucor Corporation | | | 6.4x | | | 6.7x | |
Metal Fabrication Company | | | BlueScope Steel Limited | | | 6.1x | | | 6.1x | |
Date Announced | | | Acquiror | | | Target | | | TEV/ LTM EBITDA | |
January 2018 | | | The Sponsor Fund X Investor | | | Ply Gem Holdings, Inc. | | | 9.8x | |
January 2018 | | | The Sponsor Fund X Investor | | | Atrium Windows & Doors, Inc. | | | 8.1x | |
November 2016 | | | Boral Limited | | | Headwaters Incorporated | | | 11.8x | |
August 2016 | | | Headwaters Incorporated | | | Krestmark Industries LP | | | 11.6x | |
November 2015 | | | PGT, Inc. | | | WinDoor, Inc. | | | 11.8x | |
August 2014 | | | Ply Gem Industries, Inc. | | | Fortune Brands Windows, Inc. | | | 10.0x | |
July 2014 | | | PGT, Inc. | | | CGI Windows & Doors Holdings, Inc. | | | 11.9x | |
August 2013 | | | Ares Management LLC/Ontario Teachers’ Pension Plan | | | CPG International Inc. | | | 11.0x | |
September 2010 | | | Hellman & Friedman LLC | | | Associated Materials LLC | | | 11.4x | |
| | | NCI Contribution | | | Ply Gem Contribution | | | Run-Rate Synergies | | ||||||
EBITDA | | | | | | | | | | | | | | | | |
2018E | | | | | 33% | | | | | | 60% | | | | 7% | |
2019E | | | | | 33% | | | | | | 60% | | | | 6% | |
2020E | | | | | 34% | | | | | | 61% | | | | 6% | |
EBITDA – CapEx | | | | | | | | | | | | | | | | |
2018E | | | | | 30% | | | | | | 61% | | | | 9% | |
2019E | | | | | 30% | | | | | | 62% | | | | 8% | |
2020E | | | | | 31% | | | | | | 63% | | | | 7% | |
Relative Enterprise Value | | | | | | | | | | | | | | | | |
At Transaction | | | | | 33% | | | | | | 67% | | | | N/A | |
| | Golden Parachute Compensation | | | Golden Parachute Compensation | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Name | | Cash ($)(1) | | Equity ($)(2) | | Pension/ NQDC ($)(3) | | Perquisites/ Benefits ($)(4) | | Other ($)(5) | | Total ($) | | | Cash ($)(1) | | Equity ($)(2) | | Pension/ NQDC ($)(3) | | Perquisites/ Benefits ($)(4) | | Other ($)(5) | | Total ($) | | ||||||||||||||||||||||||||||||||||||||||||||||||
Donald R. Riley President and Chief Executive Officer | | | | 4,325,342 | | | | | 4,597,452 | | | | | 133,554 | | | | | 30,000 | | | | | — | | | | | 9,086,348 | | | | | | 4,442,466 | | | | | 4,597,452 | | | | | 133,554 | | | | | 30,000 | | | | | — | | | | | 9,203,472 | | | ||||||||||||
Todd R. Moore Executive Vice President, Chief Legal, Risk & Compliance Officer | | | | 1,536,404 | | | | | 1,871,726 | | | | | — | | | | | 30,000 | | | | | — | | | | | 3,438,130 | | | | | | 1,580,560 | | | | | 1,871,726 | | | | | — | | | | | 30,000 | | | | | — | | | | | 3,482,286 | | |
| | Golden Parachute Compensation | | | Golden Parachute Compensation | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Name | | Cash ($)(1) | | Equity ($)(2) | | Pension/ NQDC ($)(3) | | Perquisites/ Benefits ($)(4) | | Other ($)(5) | | Total ($) | | | Cash ($)(1) | | Equity ($)(2) | | Pension/ NQDC ($)(3) | | Perquisites/ Benefits ($)(4) | | Other ($)(5) | | Total ($) | | ||||||||||||||||||||||||||||||||||||||||||||||||
John L. Kuzdal President of Group Manufacturing Segment | | | | 1,695,342 | | | | | 2,093,198 | | | | | 98,816 | | | | | 30,000 | | | | | — | | | | | 3,917,356 | | | | | | 1,744,066 | | | | | 2,093,198 | | | | | 98,816 | | | | | 30,000 | | | | | — | | | | | 3,966,080 | | | ||||||||||||
Katy K. Theroux Executive Vice President, Corporate Marketing and Chief Human Resources Officer | | | | 1,630,137 | | | | | 1,749,282 | | | | | — | | | | | 30,000 | | | | | — | | | | | 3,409,419 | | | | | | 1,676,986 | | | | | 1,749,282 | | | | | — | | | | | 30,000 | | | | | — | | | | | 3,456,268 | | | ||||||||||||
Bradley S. Little Interim Chief Financial Officer and Treasurer | | | | 716,986 | | | | | 1,035,950 | | | | | 44,103 | | | | | 30,000 | | | | | 222,500 | | | | | 2,049,539 | | | | | | 755,051 | | | | | 1,035,950 | | | | | 44,103 | | | | | 30,000 | | | | | 222,500 | | | | | 2,087,604 | | | ||||||||||||
Norman C. Chambers Former Chief Executive Officer and Executive Chairman(6) | | | | — | | | | | 4,496,609 | | | | | — | | | | | — | | | | | — | | | | | 4,496,609 | | | | | | — | | | | | 4,496,609 | | | | | — | | | | | — | | | | | — | | | | | 4,496,609 | | |
Name | | Cash Severance($) | | Pro Rata Bonus($) | | Total($) | | | Cash Severance($) | | Pro Rata Bonus($) | | Total($) | | ||||||||||||||||||||||||
Donald R. Riley | | | | 3,750,000 | | | | | 575,342 | | | | | 4,325,342 | | | | | | 3,750,000 | | | | | 692,466 | | | | | 4,442,466 | | | ||||||
Todd R. Moore | | | | 1,319,500 | | | | | 216,904 | | | | | 1,536,404 | | | | | | 1,319,500 | | | | | 261,060 | | | | | 1,580,560 | | | ||||||
John L. Kuzdal | | | | 1,456,000 | | | | | 239,342 | | | | | 1,695,342 | | | | | | 1,456,000 | | | | | 288,066 | | | | | 1,744,066 | | | ||||||
Katy K. Theroux | | | | 1,400,000 | | | | | 230,137 | | | | | 1,630,137 | | | | | | 1,400,000 | | | | | 276,986 | | | | | 1,676,986 | | | ||||||
Bradley S. Little | | | | 530,000 | | | | | 186,986 | | | | | 716,986 | | | | | | 530,000 | | | | | 225,051 | | | | | 755,051 | | |
Name | | | Single-Trigger PSU Awards ($) | | | Single-Trigger RSU and Restricted Stock Awards ($) | | | Double-Trigger PSU Awards ($) | | | Double-Trigger RSU Awards ($) | | | Total ($) | | |||||||||||||||
Donald R. Riley | | | | | 1,259,070 | | | | | | 235,375 | | | | | | 1,776,161 | | | | | | 1,326,846 | | | | | | 4,597,452 | | |
Todd R. Moore | | | | | 854,386 | | | | | | 96,843 | | | | | | 593,493 | | | | | | 327,004 | | | | | | 1,871,726 | | |
John L. Kuzdal | | | | | 989,269 | | | | | | 112,123 | | | | | | 642,780 | | | | | | 349,026 | | | | | | 2,093,198 | | |
Katy K. Theroux | | | | | 719,469 | | | | | | 113,485 | | | | | | 544,206 | | | | | | 372,122 | | | | | | 1,749,282 | | |
Bradley S. Little | | | | | 449,668 | | | | | | 125,924 | | | | | | 299,184 | | | | | | 161,174 | | | | | | 1,035,950 | | |
Name | | | Age | | | Position | | |||
James S. Metcalf | | | | | 60 | | | | Chairman & Chief Executive Officer | |
Donald R. Riley | | | | | 54 | | | | Chief Executive Officer, NCI Division and Head of Supply Chain & Technology | |
Name | | | Age | | | Position | | |||
Shawn K. Poe | | | | | 56 | | | | Chief Financial Officer | |
Katy K. Theroux | | | | | 49 | | | | Executive Vice President, Chief Human Resources Officer | |
Todd R. Moore | | | | | 58 | | | | Executive Vice President, Chief Legal, Risk & Compliance Officer and Corporate Secretary | |
| | NCI Historical | | Ply Gem Historical | | Reclassifications (Note 5) | | Pro Forma Adjustments | | (Notes) | | Pro Forma | | | NCI Historical | | Ply Gem Historical | | Reclassifications (Note 5) | | Pro Forma Adjustments | | (Notes) | | Pro Forma | | ||||||||||||||||||||||||||||||||||||||||||||||||
Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||||||
Current assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||||||
Cash and cash equivalents | | | $ | 43,322 | | | | $ | 53,609 | | | | $ | — | | | | $ | 43,577 | | | | | 6.a | | | | $ | 140,508 | | | | | $ | 43,322 | | | | $ | 53,609 | | | | $ | — | | | | $ | 43,577 | | | | | 6.a | | | | $ | 140,508 | | | ||||||||||||
Restricted cash | | | | 180 | | | | | — | | | | | — | | | | | — | | | | | | | | | | 180 | | | | | | 180 | | | | | — | | | | | — | | | | | — | | | | | | | | | | 180 | | | ||||||||||||
Accounts receivable, net | | | | 211,098 | | | | | 340,107 | | | | | — | | | | | — | | | | | | | | | | 551,205 | | | | | | 211,098 | | | | | 340,107 | | | | | — | | | | | — | | | | | | | | | | 551,205 | | | ||||||||||||
Inventories, net | | | | 260,879 | | | | | 256,225 | | | | | — | | | | | — | | | | | | | | | | 517,104 | | | | | | 260,879 | | | | | 256,225 | | | | | — | | | | | — | | | | | | | | | | 517,104 | | | ||||||||||||
Income taxes receivable | | | | 1,171 | | | | | — | | | | | — | | | | | — | | | | | | | | | | 1,171 | | | | | | 1,171 | | | | | — | | | | | — | | | | | — | | | | | | | | | | 1,171 | | | ||||||||||||
Investments in debt and equity securities, at market | | | | 5,785 | | | | | — | | | | | — | | | | | — | | | | | | | | | | 5,785 | | | | | | 5,785 | | | | | — | | | | | — | | | | | — | | | | | | | | | | 5,785 | | | ||||||||||||
Prepaid expenses and other current assets | | | | 35,859 | | | | | 25,964 | | | | | — | | | | | — | | | | | | | | | | 61,823 | | | | | | 35,859 | | | | | 25,964 | | | | | — | | | | | — | | | | | | | | | | 61,823 | | | ||||||||||||
Assets held for sale | | | | 7,272 | | | | | — | | | | | — | | | | | — | | | | | | | | | | 7,272 | | | | | | 7,272 | | | | | — | | | | | — | | | | | — | | | | | | | | | | 7,272 | | | ||||||||||||
Total current assets | | | | 565,566 | | | | | 675,905 | | | | | — | | | | | 43,577 | | | | | | | | | | 1,285,048 | | | | | | 565,566 | | | | | 675,905 | | | | | — | | | | | 43,577 | | | | | | | | | | 1,285,048 | | | ||||||||||||
Property and equipment, net | | | | 230,851 | | | | | 303,689 | | | | | — | | | | | — | | | | | | | | | | 534,540 | | | | | | 230,851 | | | | | 303,689 | | | | | — | | | | | — | | | | | | | | | | 534,540 | | | ||||||||||||
Other assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||||||
Goodwill | | | | 148,291 | | | | | 1,232,392 | | | | | — | | | | | 360,944 | | | | | 6.b | | | | | 1,741,627 | | | | | | 148,291 | | | | | 1,232,392 | | | | | — | | | | | 312,803 | | | | | 6.b | | | | | 1,693,486 | | | ||||||||||||
Intangible assets, net | | | | 129,933 | | | | | 1,662,152 | | | | | — | | | | | — | | | | | | | | | | 1,792,085 | | | | | | 129,933 | | | | | 1,662,152 | | | | | — | | | | | — | | | | | | | | | | 1,792,085 | | | ||||||||||||
Deferred income tax assets | | | | 1,701 | | | | | — | | | | | — | | | | | — | | | | | | | | | | 1,701 | | | | | | 1,701 | | | | | — | | | | | — | | | | | — | | | | | | | | | | 1,701 | | | ||||||||||||
Other assets, net | | | | 5,352 | | | | | 12,108 | | | | | — | | | | | 2,150 | | | | | 6.c | | | | | 19,610 | | | | | | 5,352 | | | | | 12,108 | | | | | — | | | | | 2,150 | | | | | 6.c | | | | | 19,610 | | | ||||||||||||
Total other assets | | | | 285,277 | | | | | 2,906,652 | | | | | — | | | | | 363,094 | | | | | | | | | | 3,555,023 | | | | | | 285,277 | | | | | 2,906,652 | | | | | — | | | | | 314,953 | | | | | | | | | | 3,506,882 | | | ||||||||||||
Total assets | | | | 1,081,694 | | | | | 3,886,246 | | | | | — | | | | | 406,671 | | | | | | | | | | 5,374,611 | | | | | | 1,081,694 | | | | | 3,886,246 | | | | | — | | | | | 358,530 | | | | | | | | | | 5,326,470 | | | ||||||||||||
Liabilities | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||||||
Current liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||||||
Notes payable | | | | 994 | | | | | — | | | | | — | | | | | — | | | | | | | | | | 994 | | | | | | 994 | | | | | — | | | | | — | | | | | — | | | | | | | | | | 994 | | | ||||||||||||
Accounts payable | | | | 179,700 | | | | | 113,793 | | | | | — | | | | | — | | | | | | | | | | 293,493 | | | | | | 179,700 | | | | | 113,793 | | | | | — | | | | | — | | | | | | | | | | 293,493 | | | ||||||||||||
Accrued compensation and benefits | | | | 58,454 | | | | | — | | | | | 24,186 | | | | | (1,563) | | | | | 6.d | | | | | 81,077 | | | | | | 58,454 | | | | | — | | | | | 24,186 | | | | | (1,563) | | | | | 6.d | | | | | 81,077 | | | ||||||||||||
Accrued interest | | | | 1,488 | | | | | — | | | | | 35,659 | | | | | (1,488) | | | | | 6.e | | | | | 35,659 | | | | | | 1,488 | | | | | — | | | | | 35,659 | | | | | (1,488) | | | | | 6.e | | | | | 35,659 | | | ||||||||||||
Other accrued expenses | | | | 106,204 | | | | | — | | | | | 177,795 | | | | | 34,108 | | | | | 6.f,6.g | | | | | 318,107 | | | | | | 106,204 | | | | | — | | | | | 177,795 | | | | | 34,108 | | | | | 6.f,6.g | | | | | 318,107 | | | ||||||||||||
Accrued expenses | | | | — | | | | | 237,640 | | | | | (237,640) | | | | | — | | | | | | | | | | — | | | | | | — | | | | | 237,640 | | | | | (237,640) | | | | | — | | | | | | | | | | — | | | ||||||||||||
Current portion of payable to related parties pursuant to tax receivable agreement | | | | — | | | | | 24,894 | | | | | — | | | | | — | | | | | | | | | | 24,894 | | | | | | — | | | | | 24,894 | | | | | — | | | | | — | | | | | | | | | | 24,894 | | | ||||||||||||
Current portion of long-term debt | | | | 4,150 | | | | | 17,550 | | | | | — | | | | | 600 | | | | | 6.h | | | | | 22,300 | | | | | | 4,150 | | | | | 17,550 | | | | | — | | | | | 600 | | | | | 6.h | | | | | 22,300 | | | ||||||||||||
Accrued income taxes | | | | 7,925 | | | | | — | | | | | — | | | | | — | | | | | | | | | | 7,925 | | | | | | 7,925 | | | | | — | | | | | — | | | | | — | | | | | | | | | | 7,925 | | | ||||||||||||
Total current liabilities | | | | 358,915 | | | | | 393,877 | | | | | — | | | | | 31,657 | | | | | | | | | | 784,449 | | | | | | 358,915 | | | | | 393,877 | | | | | — | | | | | 31,657 | | | | | | | | | | 784,449 | | | ||||||||||||
Long-term debt, net of deferred financing costs | | | | 403,842 | | | | | 2,434,598 | | | | | — | | | | | 54,533 | | | | | 6.h | | | | | 2,892,973 | | | | | | 403,842 | | | | | 2,434,598 | | | | | — | | | | | 54,533 | | | | | 6.h | | | | | 2,892,973 | | | ||||||||||||
Deferred income taxes | | | | 1,740 | | | | | 332,513 | | | | | — | | | | | — | | | | | | | | | | 334,253 | | | | | | 1,740 | | | | | 332,513 | | | | | — | | | | | — | | | | | | | | | | 334,253 | | | ||||||||||||
Long-term portion of payable to related parties pursuant to tax receivable agreement | | | | — | | | | | 23,362 | | | | | — | | | | | — | | | | | | | | | | 23,362 | | | | | | — | | | | | 23,362 | | | | | — | | | | | — | | | | | | | | | | 23,362 | | | ||||||||||||
Other long-term liabilities | | | | 18,111 | | | | | 91,076 | | | | | — | | | | | — | | | | | | | | | | 109,187 | | | | | | 18,111 | | | | | 91,076 | | | | | — | | | | | — | | | | | | | | | | 109,187 | | | ||||||||||||
Total long-term liabilities | | | | 423,693 | | | | | 2,881,549 | | | | | — | | | | | 54,533 | | | | | | | | | | 3,359,775 | | | | | | 423,693 | | | | | 2,881,549 | | | | | — | | | | | 54,533 | | | | | | | | | | 3,359,775 | | | ||||||||||||
Total liabilities | | | | 782,608 | | | | | 3,275,426 | | | | | — | | | | | 86,190 | | | | | | | | | | 4,144,224 | | | | | | 782,608 | | | | | 3,275,426 | | | | | — | | | | | 86,190 | | | | | | | | | | 4,144,224 | | | ||||||||||||
Stockholders’ Equity | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||||||
Common stock | | | | 663 | | | | | 64 | | | | | — | | | | | 530 | | | | | 6.i | | | | | 1,257 | | | | | | 663 | | | | | 64 | | | | | — | | | | | 530 | | | | | 6.i | | | | | 1,257 | | | ||||||||||||
Additional paid-in capital | | | | 521,059 | | | | | 637,911 | | | ��� | | | — | | | | | 328,913 | | | | | 6.i | | | | | 1,487,883 | | | | | | 521,059 | | | | | 637,911 | | | | | — | | | | | 280,772 | | | | | 6.i | | | | | 1,439,742 | | | |||||||||||
Accumulated deficit | | | | (213,846) | | | | | (20,411) | | | | | — | | | | | (15,706) | | | | | 6.i | | | | | (249,963) | | | | | | (213,846) | | | | | (20,411) | | | | | — | | | | | (15,706) | | | | | 6.i | | | | | (249,963) | | | ||||||||||||
Accumulated other comprehensive loss | | | | (7,623) | | | | | (6,744) | | | | | — | | | | | 6,744 | | | | | | | | | | (7,623) | | | | | | (7,623) | | | | | (6,744) | | | | | — | | | | | 6,744 | | | | | | | | | | (7,623) | | | ||||||||||||
Treasury stock, at cost | | | | (1,167) | | | | | — | | | | | — | | | | | — | | | | | | | | | | (1,167) | | | | | | (1,167) | | | | | — | | | | | — | | | | | — | | | | | | | | | | (1,167) | | | ||||||||||||
Total stockholders’ equity | | | | 299,086 | | | | | 610,820 | | | | | — | | | | | 320,481 | | | | | | | | | | 1,230,387 | | | | | | 299,086 | | | | | 610,820 | | | | | — | | | | | 272,340 | | | | | | | | | | 1,182,246 | | | ||||||||||||
Total liabilities and stockholders’ equity | | | $ | 1,081,694 | | | | $ | 3,886,246 | | | | $ | — | | | | $ | 406,671 | | | | | | | | | $ | 5,374,611 | | | | | $ | 1,081,694 | | | | $ | 3,886,246 | | | | $ | — | | | | $ | 358,530 | | | | | | | | | $ | 5,326,470 | | | |
| | | NCI Historical | | | Ply Gem- Atrium Merger Pro Forma (Note 7) | | | Reclassifications (Note 5) | | | Pro Forma Adjustments | | | (Notes) | | | Pro Forma | | |||||||||||||||
Revenue | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net sales | | | | $ | 1,426,943 | | | | | $ | 1,821,558 | | | | | $ | — | | | | | $ | — | | | | | | | | $ | 3,248,501 | | |
Cost of sales | | | | | 1,097,542 | | | | | | 1,442,814 | | | | | | (138) | | | | | | — | | | | | | | | | 2,540,218 | | |
Gross profit | | | | | 329,401 | | | | | | 378,744 | | | | | | 138 | | | | | | — | | | | | | | | | 708,283 | | |
Engineering, selling, general and administrative expenses | | | | | 228,231 | | | | | | 245,739 | | | | | | 138 | | | | | | (3,800) | | | | 6.j | | | | | 470,308 | | |
Intangible asset amortization | | | | | 7,237 | | | | | | 84,480 | | | | | | — | | | | | | — | | | | | | | | | 91,717 | | |
Strategic development and acquisition related costs | | | | | 5,503 | | | | | | — | | | | | | — | | | | | | — | | | | | | | | | 5,503 | | |
Restructuring and impairment charges | | | | | 1,143 | | | | | | — | | | | | | — | | | | | | — | | | | | | | | | 1,143 | | |
Gain on insurance recovery | | | | | (4,741) | | | | | | — | | | | | | — | | | | | | — | | | | | | | | | (4,741) | | |
Loss on disposition of business | | | | | 5,673 | | | | | | — | | | | | | — | | | | | | — | | | | | | | | | 5,673 | | |
Operating earnings | | | | | 86,355 | | | | | | 48,525 | | | | | | — | | | | | | 3,800 | | | | | | | | | 138,680 | | |
Interest income | | | | | 118 | | | | | | 118 | | | | | | — | | | | | | — | | | | | | | | | 236 | | |
Interest expense | | | | | (16,913) | | | | | | (131,197) | | | | | | — | | | | | | (4,574) | | | | 6.k | | | | | (152,684) | | |
Foreign currency (loss) | | | | | (92) | | | | | | (2,104) | | | | | | — | | | | | | — | | | | | | | | | (2,196) | | |
Other income, net | | | | | 1,072 | | | | | | — | | | | | | — | | | | | | — | | | | | | | | | 1,072 | | |
Loss on extinguishment of debt | | | | | (21,875) | | | | | | — | | | | | | — | | | | | | — | | | | | | | | | (21,875) | | |
Tax receivable agreement liability adjustment | | | | | — | | | | | | 5,512 | | | | | | — | | | | | | — | | | | | | | | | 5,512 | | |
Income (loss) before income taxes | | | | | 48,665 | | | | | | (79,146) | | | | | | — | | | | | | (774) | | | | | | | | | (31,255) | | |
(Benefit) provision for income taxes | | | | | 13,114 | | | | | | (4,710) | | | | | | — | | | | | | (211) | | | | 6.l | | | | | 8,193 | | |
Net income (loss) | | | | | 35,551 | | | | | | (74,436) | | | | | | — | | | | | | (563) | | | | | | | | | (39,448) | | |
Net income allocated to participating securities | | | | | (248) | | | | | | — | | | | | | — | | | | | | — | | | | | | | | | (248) | | |
Net income (loss) applicable to common shares | | | | $ | 35,303 | | | | | $ | (74,436) | | | | | $ | — | | | | | $ | (563) | | | | | | | | $ | (39,696) | | |
Income (loss) per common share: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Basic | | | | $ | 0.53 | | | | | | | | | | | | | | | | | | | | | | | | | | $ | (0.32) | | |
Diluted | | | | $ | 0.53 | | | | | | | | | | | | | | | | | | | | | | | | | | $ | (0.32) | | |
Weighted average number of common shares outstanding: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Basic | | | | | 66,361 | | | | | | | | | | | | | | | | | | 59,395 | | | | 6.m | | | | | 125,756 | | |
Diluted | | | | | 66,477 | | | | | | | | | | | | | | | | | | 59,395 | | | | 6.m | | | | | 125,872 | | |
| | | NCI Historical | | | Ply Gem- Atrium Merger Pro Forma (Note 7) | | | Reclassifications (Note 5) | | | Pro Forma Adjustments | | | (Notes) | | | Pro Forma | | |||||||||||||||
Revenue | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net sales | | | | $ | 1,770,278 | | | | | $ | 2,405,147 | | | | | $ | — | | | | | $ | — | | | | | | | | $ | 4,175,425 | | |
Cost of sales | | | | | 1,354,077 | | | | | | 1,840,769 | | | | | | (278) | | | | | | — | | | | | | | | | 3,194,568 | | |
Loss on sale of assets and asset recovery | | | | | 137 | | | | | | — | | | | | | — | | | | | | — | | | | | | | | | 137 | | |
Gross profit | | | | | 416,064 | | | | | | 564,378 | | | | | | 278 | | | | | | — | | | | | | | | | 980,720 | | |
Engineering, selling, general and administrative expenses | | | | | 293,145 | | | | | | 315,394 | | | | | | 278 | | | | | | — | | | | | | | | | 608,817 | | |
Intangible asset amortization | | | | | 9,620 | | | | | | 112,640 | | | | | | — | | | | | | — | | | | | | | | | 122,260 | | |
Goodwill impairment | | | | | 6,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | | | | 6,000 | | |
Strategic development and acquisition related costs | | | | | 1,971 | | | | | | — | | | | | | — | | | | | | — | | | | | | | | | 1,971 | | |
Restructuring and impairment charges | | | | | 5,297 | | | | | | — | | | | | | — | | | | | | — | | | | | | | | | 5,297 | | |
Gain on insurance recovery | | | | | (9,749) | | | | | | — | | | | | | — | | | | | | — | | | | | | | | | (9,749) | | |
Operating earnings | | | | | 109,780 | | | | | | 136,344 | | | | | | — | | | | | | — | | | | | | | | | 246,124 | | |
Interest income | | | | | 238 | | | | | | 97 | | | | | | — | | | | | | — | | | | | | | | | 335 | | |
Interest expense | | | | | (28,899) | | | | | | (175,116) | | | | | | — | | | | | | 129 | | | | 6.k | | | | | (203,886) | | |
Foreign currency gain | | | | | 547 | | | | | | 1,317 | | | | | | — | | | | | | — | | | | | | | | | 1,864 | | |
Other income, net | | | | | 1,472 | | | | | | — | | | | | | — | | | | | | — | | | | | | | | | 1,472 | | |
Tax receivable agreement liability adjustment | | | | | — | | | | | | 10,749 | | | | | | — | | | | | | — | | | | | | | | | 10,749 | | |
Income (loss) before income taxes | | | | | 83,138 | | | | | | (26,609) | | | | | | — | | | | | | 129 | | | | | | | | | 56,658 | | |
(Benefit) provision for income taxes | | | | | 28,414 | | | | | | (8,401) | | | | | | — | | | | | | 50 | | | | 6.l | | | | | 20,063 | | |
Net income (loss) | | | | | 54,724 | | | | | | (18,208) | | | | | | — | | | | | | 79 | | | | | | | | | 36,595 | | |
Net income allocated to participating securities | | | | | (325) | | | | | | — | | | | | | — | | | | | | — | | | | | | | | | (325) | | |
Net income (loss) applicable to common shares | | | | $ | 54,399 | | | | | $ | (18,208) | | | | | $ | — | | | | | $ | 79 | | | | | | | | $ | 36,270 | | |
Income (loss) per common share: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Basic | | | | $ | 0.77 | | | | | | | | | | | | | | | | | | | | | | | | | | $ | 0.28 | | |
Diluted | | | | $ | 0.77 | | | | | | | | | | | | | | | | | | | | | | | | | | $ | 0.28 | | |
Weighted average number of common shares outstanding: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Basic | | | | | 70,629 | | | | | | | | | | | | | | | | | | 59,395 | | | | 6.m | | | | | 130,024 | | |
Diluted | | | | | 70,778 | | | | | | | | | | | | | | | | | | 59,395 | | | | 6.m | | | | | 130,173 | | |
| Number of NCI shares issued | | | | 58,709,067 | Number of NCI shares issued | | | | 58,709,067 | ||
| NCI common stock price | | | $ | 16.45 | NCI common stock price | | | $ | 15.63 | ||
| Estimated purchase price | | | $ | 965,764,152 | Estimated purchase price | | | $ | 917,622,717 | |
(in thousands, except stock price) | | Stock Price | | Estimated Purchase Price | | Total Goodwill (including acquirer goodwill) | | | Stock Price | | Estimated Purchase Price | | Total Goodwill (including acquirer goodwill) | | ||||||||||||||||||||||||
Change in stock price | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||
Increase of 35% | | | $ | 22.21 | | | | $ | 1,303,928 | | | | $ | 2,079,791 | | | | | $ | 21.10 | | | | $ | 1,238,761 | | | | $ | 2,014,624 | | | ||||||
Decrease of 35% | | | | 10.69 | | | | | 627,600 | | | | | 1,403,463 | | | | | | 10.16 | | | | | 596,484 | | | | | 1,372,347 | | |
(dollars in thousands) | | | | | ||||||||
Preliminary purchase price: | | | | | | | | | ||||
Ply Gem | | | $ | 965,764 | | | $ | 917,623 | ||||
Book value of net assets acquired | | | | | | | | | ||||
Book value of Ply Gem’s net assets | | | | 610,820 | | | | 610,820 | ||||
Less Ply Gem’s estimated merger related costs | | | | (6,000) | | | | (6,000) | ||||
Net assets to be acquired | | | | 604,820 | | | | 604,820 | ||||
Allocation of purchase price | | | | | | | | | ||||
Net assets to be acquired | | | | 604,820 | | | | 604,820 | ||||
Adjustment to goodwill | | | | 360,944 | | | | 312,803 | ||||
Total allocation of purchase price | | | | 965,764 | | | | 917,623 | ||||
Assets acquired | | | | 2,653,854 | | | | 2,653,854 | ||||
Liabilities assumed | | | | (3,281,426) | | | | (3,281,426) | ||||
Goodwill | | | | 1,593,336 | | | | 1,545,195 | ||||
Total preliminary purchase price allocation | | | $ | 965,764 | | | $ | 917,623 | |
(dollars in thousands) | | | As of July 29, 2018 | | |||
Increase/(Decrease) | | | | | | | |
Accrued expenses | | | | $ | (24,186) | | |
Accrued compensation and benefits | | | | | 24,186 | | |
Accrued expenses | | | | $ | (35,659) | | |
Accrued interest | | | | | 35,659 | | |
Accrued expenses | | | | $ | (177,795) | | |
Other accrued expenses | | | | | 177,795 | | |
(dollars in thousands) | | | For the year ended October 29, 2017 | | |||
Increase/(Decrease) | | | | | | | |
Cost of sales | | | | $ | (278) | | |
Engineering, selling, general and administrative expenses | | | | | 278 | | |
(dollars in thousands) | | | For the nine months to July 29, 2018 | | |||
Increase/(Decrease) | | | | | | | |
Cost of sales | | | | $ | (138) | | |
Engineering, selling, general and administrative expenses | | | | | 138 | | |
(dollars in thousands) | | | ||||
Proceeds from the incremental secured term loan facility | | | | $ | 475,000 | |
Less: estimated original issue discount on the incremental term loan facility | | | | | (2,375) | |
Less: payment of estimated debt issuance costs | | | | | (11,650) | |
Less: repayment of NCI existing term loan (current and non-current) | | | | | (413,963) | |
Less: repayment of accrued interest on the NCI existing term loan | | | | | (1,488) | |
Less: cash-settlement of accelerated NCI long-term incentive plan awards | | | | | (1,947) | |
Net adjustment to cash | | | | $ | 43,577 | |
|
(dollars in thousands) | | Goodwill | | Goodwill | ||||||
Goodwill in merger | | | $ | 1,593,336 | | | $ | 1,545,195 | ||
Pre-merger goodwill: | | | | | | | | | ||
Ply Gem acquisition goodwill | | | | 1,232,392 | | | | 1,232,392 | ||
Net adjustment to goodwill | | | $ | 360,944 | | | $ | 312,803 | |
(dollars in thousands) | | | ||||
Proceeds from the incremental secured term loan facility | | | | $ | 475,000 | |
Less: estimated original issue discount on the incremental term loan facility | | | | | (2,375) | |
Less: payment of estimated debt issuance costs | | | | | (9,500) | |
Less: repayment of NCI existing term loan (current and non-current) | | | | | (413,963) | |
Plus: debt issuance costs on NCI existing term loan | | | | | 5,971 | |
Net adjustment to long-term debt (current and non-current) | | | | $ | 55,133 | |
|
Current portion | | | |||||
Repayment of NCI existing term loan (current) | | | | | (4,150) | | |
Current portion of incremental secured term loan facility | | | | | 4,750 | | |
Net adjustment to current portion of long-term debt | | | | $ | 600 | | |
|
Non-current portion | | | |||||
Net adjustment to long-term debt | | | | $ | 54,533 | | |
|
(dollars in thousands) | | | Year ended October 29, 2017 | | | Nine months ended July 29, 2018 | | ||||||
Cash interest expense | | | | $ | (26,876) | | | | | $ | (20,034) | | |
Amortization of debt issuance cost | | | | | (1,601) | | | | | | (1,227) | | |
Amortization of original issue discount | | | | | (293) | | | | | | (226) | | |
Elimination of historical interest expense | | | | | 28,899 | | | | | | 16,913 | | |
Total adjustment to interest expense | | | | $ | 129 | | | | | $ | (4,574) | | |
|
(dollars in thousands) | | | ||||
Preliminary Purchase Price: | | | | | | |
Ply Gem Holdings | | | | $ | 3,064,313 | |
Total consideration | | | | $ | 3,064,313 | |
Preliminary Purchase Price Allocation: | | | | | | |
Accounts receivable | | | | $ | 270,758 | |
Inventory | | | | | 288,518 | |
Prepaid expenses and other current assets | | | | | 32,966 | |
Property and equipment | | | | | 301,963 | |
Intangible assets, net | | | | | 1,689,600 | |
Other assets | | | | | 12,923 | |
Goodwill | | | | | 1,235,096 | |
Accounts payable(1) | | | | | (119,882) | |
Tax receivable agreement liability | | | | | (48,256) | |
Other liabilities | | | | | (146,354) | |
Accrued long-term warranty | | | | | (67,364) | |
Deferred income taxes | | | | | (358,658) | |
Other long-term liabilities | | | | | (26,997) | |
Net assets acquired | | | | $ | 3,064,313 | |
|
| | | Successor | | | Predecessor | | | | | | | | ||||||||||||||||||||||||||||||
| | | Ply Gem Historical (April 13, 2018 – June 30, 2018) | | | Ply Gem Holdings Historical (October 1, 2017 – April 12, 2018) (Note 7.a) | | | Atrium Historical (October 1, 2017 to April 12, 2018) (Note 7.a, 7.b) | | | Ply Gem- Atrium Merger Adjustments | | | (Notes) | | | Ply Gem- Atrium Financing Adjustments | | | (Notes) | | | Ply Gem- Atrium Merger Pro Forma | | ||||||||||||||||||
Net sales | | | | $ | 597,936 | | | | | $ | 1,046,501 | | | | | $ | 177,121 | | | | | $ | — | | | | | | | | $ | — | | | | | | | | $ | 1,821,558 | | |
Cost of products sold | | | | | 479,402 | | | | | | 833,398 | | | | | | 132,967 | | | | | | (2,953) | | | | 7.c | | | | | — | | | | | | | | | 1,442,814 | | |
Gross profit | | | | | 118,534 | | | | | | 213,103 | | | | | | 44,154 | | | | | | 2,953 | | | | | | | | | — | | | | | | | | | 378,744 | | |
Operating expenses: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Selling, general and administrative expenses | | | | | 69,812 | | | | | | 151,738 | | | | | | 25,883 | | | | | | (1,694) | | | | 7.c,7.d | | | | | — | | | | | | | | | 245,739 | | |
Acquisition related expenses | | | | | 11,186 | | | | | | 67,802 | | | | | | 8,281 | | | | | | (87,269) | | | | 7.e | | | | | — | | | | | | | | | — | | |
Amortization of intangible assets | | | | | 24,096 | | | | | | 11,433 | | | | | | 3,677 | | | | | | 45,274 | | | | 7.f | | | | | — | | | | | | | | | 84,480 | | |
Total operating expenses | | | | | 105,094 | | | | | | 230,973 | | | | | | 37,841 | | | | | | (43,689) | | | | | | | | | — | | | | | | | | | 330,219 | | |
Operating earnings (loss) | | | | | 13,440 | | | | | | (17,870) | | | | | | 6,313 | | | | | | 46,642 | | | | | | | | | — | | | | | | | | | 48,525 | | |
Foreign currency (loss) | | | | | (1,516) | | | | | | (351) | | | | | | (237) | | | | | | — | | | | | | | | | — | | | | | | | | | (2,104) | | |
Interest expense | | | | | (43,787) | | | | | | (36,585) | | | | | | (27,092) | | | | | | 63,292 | | | | 7.g | | | | | (87,025) | | | | 7.h | | | | | (131,197) | | |
Interest income | | | | | 24 | | | | | | 40 | | | | | | 54 | | | | | | — | | | | | | | | | — | | | | | | | | | 118 | | |
Tax receivable agreement liability adjustment | | | | | — | | | | | | 5,512 | | | | | | — | | | | | | — | | | | | | | | | — | | | | | | | | | 5,512 | | |
Loss on modification or extinguishment of debt | | | | | — | | | | | | (2,106) | | | | | | — | | | | | | 2,106 | | | | 7.i | | | | | — | | | | | | | | | — | | |
Income (loss) before provision (benefit) for income taxes | | | | | (31,839) | | | | | | (51,360) | | | | | | (20,962) | | | | | | 112,040 | | | | | | | | | (87,025) | | | | | | | | | (79,146) | | |
Provision (benefit) for income taxes | | | | | (11,428) | | | | | | 849 | | | | | | (759) | | | | | | 29,690 | | | | 7.j | | | | | (23,062) | | | | 7.j | | | | | (4,710) | | |
Net income (loss) | | | | $ | (20,411) | | | | | $ | (52,209) | | | | | $ | (20,203) | | | | | $ | 82,350 | | | | | | | | $ | (63,963) | | | | | | | | $ | (74,436) | | |
| | | Ply Gem Holdings Historical (Note 7.a) | | | Atrium Historical (Note 7.a, 7.b) | | | Ply Gem- Atrium Merger Adjustments | | | (Notes) | | | Ply Gem- Atrium Financing Adjustments | | | (Notes) | | | Ply Gem- Atrium Merger Pro Forma (Note 7) | | |||||||||||||||
Net sales | | | | $ | 2,056,303 | | | | | $ | 348,844 | | | | | $ | — | | | | | | | | $ | — | | | | | | | | $ | 2,405,147 | | |
Cost of products sold | | | | | 1,587,790 | | | | | | 258,152 | | | | | | (5,173) | | | | 7.c | | | | | — | | | | | | | | | 1,840,769 | | |
Gross profit | | | | | 468,513 | | | | | | 90,692 | | | | | | 5,173 | | | | | | | | | — | | | | | | | | | 564,378 | | |
Operating expenses: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Selling, general and administrative expenses | | | | | 272,984 | | | | | | 45,392 | | | | | | (2,982) | | | | 7.c,7.d | | | | | — | | | | | | | | | 315,394 | | |
Amortization of intangible assets | | | | | 21,271 | | | | | | 6,723 | | | | | | 84,646 | | | | 7.f | | | | | — | | | | | | | | | 112,640 | | |
Total operating expenses | | | | | 294,255 | | | | | | 52,115 | | | | | | 81,664 | | | | | | | | | — | | | | | | | | | 428,034 | | |
Operating earnings | | | | | 174,258 | | | | | | 38,577 | | | | | | (76,491) | | | | | | | | | — | | | | | | | | | 136,344 | | |
Foreign currency gain (loss) | | | | | 1,363 | | | | | | (46) | | | | | | — | | | | | | | | | — | | | | | | | | | 1,317 | | |
Interest expense | | | | | (69,361) | | | | | | (35,903) | | | | | | 104,742 | | | | 7.g | | | | | (174,594) | | | | 7.h | | | | | (175,116) | | |
Interest income | | | | | 78 | | | | | | 19 | | | | | | — | | | | | | | | | — | | | | | | | | | 97 | | |
Tax receivable agreement liability adjustment | | | | | 10,749 | | | | | | — | | | | | | — | | | | | | | | | — | | | | | | | | | 10,749 | | |
Loss on modification or extinguishment of debt | | | | | (2,106) | | | | | | — | | | | | | 2,106 | | | | 7.i | | | | | — | | | | | | | | | — | | |
Income (loss) before provision (benefit) for income taxes | | | | | 114,981 | | | | | | 2,647 | | | | | | 30,357 | | | | | | | | | (174,594) | | | | | | | | | (26,609) | | |
Provision (benefit) for income taxes | | | | | 46,654 | | | | | | 1,521 | | | | | | 11,908 | | | | 7.j | | | | | (68,484) | | | | 7.j | | | | | (8,401) | | |
Net income (loss) | | | | $ | 68,327 | | | | | $ | 1,126 | | | | | $ | 18,449 | | | | | | | | $ | (106,110) | | | | | | | | $ | (18,208) | | |
|
| | | Predecessor | | | Predecessor | | | Predecessor | | | Predecessor | | | Predecessor | | | Predecessor | | ||||||||||||||||||
(dollars in thousands) | | | Year ended December 31, 2017 | | | Nine months ended September 30, 2017 | | | Three months ended December 31, 2017 | | | Three months ended March 31, 2018 | | | April 1, 2018 to April 12, 2018 | | | October 1, 2017 to April 12, 2018 | | ||||||||||||||||||
Net sales | | | | $ | 2,056,303 | | | | | $ | 1,539,445 | | | | | $ | 516,858 | | | | | $ | 459,904 | | | | | $ | 69,739 | | | | | $ | 1,046,501 | | |
Cost of products sold | | | | | 1,587,790 | | | | | | 1,181,066 | | | | | | 406,724 | | | | | | 371,854 | | | | | | 54,820 | | | | | | 833,398 | | |
Gross profit | | | | | 468,513 | | | | | | 358,379 | | | | | | 110,134 | | | | | | 88,050 | | | | | | 14,919 | | | | | | 213,103 | | |
Operating expenses: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Selling, general, and administrative | | | | | 272,984 | | | | | | 202,610 | | | | | | 70,374 | | | | | | 70,675 | | | | | | 10,689 | | | | | | 151,738 | | |
Acquisition related expenses | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 67,802 | | | | | | 67,802 | | |
Amortization of intangible assets | | | | | 21,271 | | | | | | 15,943 | | | | | | 5,328 | | | | | | 5,354 | | | | | | 751 | | | | | | 11,433 | | |
Total operating expenses | | | | | 294,255 | | | | | | 218,553 | | | | | | 75,702 | | | | | | 76,029 | | | | | | 79,242 | | | | | | 230,973 | | |
Income from operations | | | | | 174,258 | | | | | | 139,826 | | | | | | 34,432 | | | | | | 12,021 | | | | | | (64,323) | | | | | | (17,870) | | |
Foreign currency gain (loss) | | | | | 1,363 | | | | | | 1,582 | | | | | | (219) | | | | | | (741) | | | | | | 609 | | | | | | (351) | | |
Interest expense | | | | | (69,361) | | | | | | (51,830) | | | | | | (17,531) | | | | | | (16,455) | | | | | | (2,599) | | | | | | (36,585) | | |
Interest income | | | | | 78 | | | | | | 60 | | | | | | 18 | | | | | | 20 | | | | | | 2 | | | | | | 40 | | |
Tax receivable agreement liability adjustment | | | | | 10,749 | | | | | | — | | | | | | 10,749 | | | | | | — | | | | | | (5,237) | | | | | | 5,512 | | |
Loss on modification or extinguishment of debt | | | | | (2,106) | | | | | | — | | | | | | (2,106) | | | | | | — | | | | | | — | | | | | | (2,106) | | |
Income (loss) before provision (benefit) for income taxes | | | | | 114,981 | | | | | | 89,638 | | | | | | 25,343 | | | | | | (5,155) | | | | | | (71,548) | | | | | | (51,360) | | |
Provision (benefit) for income taxes | | | | | 46,654 | | | | | | 35,882 | | | | | | 10,772 | | | | | | (592) | | | | | | (9,331) | | | | | | 849 | | |
Net income (loss) | | | | $ | 68,327 | | | | | $ | 53,756 | | | | | $ | 14,571 | | | | | $ | (4,563) | | | | | $ | (62,217) | | | | | $ | (52,209) | | |
(dollars in thousands) | | | Year ended December 31, 2017 | | | Nine months ended September 30, 2017 | | | Three months ended December 31, 2017 | | | Three months ended March 31, 2018 | | | April 1, 2018 to April 12, 2018 | | | October 1, 2017 to April 12, 2018 | | ||||||||||||||||||
Net sales | | | | $ | 348,844 | | | | | $ | 257,113 | | | | | $ | 91,731 | | | | | $ | 72,369 | | | | | $ | 13,021 | | | | | $ | 177,121 | | |
Cost of products sold | | | | | 234,451 | | | | | | 173,824 | | | | | | 60,627 | | | | | | 50,873 | | | | | | 9,380 | | | | | | 120,880 | | |
Gross profit | | | | | 114,393 | | | | | | 83,289 | | | | | | 31,104 | | | | | | 21,496 | | | | | | 3,641 | | | | | | 56,241 | | |
Operating expenses: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Selling, delivery, general, and administrative | | | | | 67,572 | | | | | | 50,208 | | | | | | 17,364 | | | | | | 16,694 | | | | | | 2,452 | | | | | | 36,510 | | |
Acquisition-related costs | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 8,281 | | | | | | 8,281 | | |
Amortization expense | | | | | 6,723 | | | | | | 4,997 | | | | | | 1,726 | | | | | | 1,722 | | | | | | 229 | | | | | | 3,677 | | |
Stock compensation expense | | | | | 1 | | | | | | 1 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Total selling, delivery, general and administrative expenses | | | | | 74,296 | | | | | | 55,206 | | | | | | 19,090 | | | | | | 18,416 | | | | | | 10,962 | | | | | | 48,468 | | |
Impairment of trade name | | | | | 1,560 | | | | | | — | | | | | | 1,560 | | | | | | — | | | | | | — | | | | | | 1,560 | | |
Loss on disposal of assets, net | | | | | (239) | | | | | | (228) | | | | | | (11) | | | | | | — | | | | | | — | | | | | | (11) | | |
Total operating expenses | | | | | 75,617 | | | | | | 54,978 | | | | | | 20,639 | | | | | | 18,416 | | | | | | 10,962 | | | | | | 50,017 | | |
Operating income from continuing operations | | | | | 38,776 | | | | | | 28,311 | | | | | | 10,465 | | | | | | 3,080 | | | | | | (7,321) | | | | | | 6,224 | | |
Interest expense | | | | | 35,903 | | | | | | 20,259 | | | | | | 15,644 | | | | | | 9,050 | | | | | | 2,398 | | | | | | 27,092 | | |
Interest income | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 26 | | | | | | 26 | | |
Other expense, net | | | | | 226 | | | | | | 167 | | | | | | 59 | | | | | | 61 | | | | | | — | | | | | | 120 | | |
Income (loss) from continuing operations before income taxes | | | | | 2,647 | | | | | | 7,885 | | | | | | (5,238) | | | | | | (6,031) | | | | | | (9,693) | | | | | | (20,962) | | |
Provision (benefit) for income tax | | | | | 1,521 | | | | | | 1,880 | | | | | | (359) | | | | | | (464) | | | | | | 64 | | | | | | (759) | | |
Net income (loss) from continuing operations | | | | $ | 1,126 | | | | | $ | 6,005 | | | | | $ | (4,879) | | | | | $ | (5,567) | | | | | $ | (9,757) | | | | | $ | (20,203) | | |
(dollars in thousands) Presentation in Atrium’s Historical Financial Statements | | | Presentation in Unaudited Pro Forma Condensed Combined Financial Statements | | | Year Ended December 31, 2017 | | | October 1, 2017 to April 12, 2018 | | ||||||
Cost of goods sold | | | Cost of products sold | | | | $ | 234,451 | | | | | $ | 120,880 | | |
Selling, delivery, general and administrative expenses (Delivery expenses) | | | Cost of products sold | | | | | 23,701 | | | | | | 12,087 | | |
Selling, delivery, general and administrative expenses | | | Selling, general and administrative expenses | | | | | 45,392 | | | | | | 25,883 | | |
Amortization expense | | | Amortization of intangible assets | | | | | 6,723 | | | | | | 3,677 | | |
Stock compensation expense | | | Selling, general and administrative expenses | | | | | 1 | | | | | | — | | |
Impairment of trade names | | | Selling, general and administrative expenses | | | | | 1,560 | | | | | | 1,560 | | |
(Gain) Loss on disposal of assets, net | | | Selling, general and administrative expenses | | | | | (239) | | | | | | (11) | | |
Other expense, net | | | Selling, general and administrative expenses | | | | | 199 | | | | | | (89) | | |
Other expense, net (Realized Gains/Losses) | | | Foreign currency gain (loss) | | | | | (46) | | | | | | (237) | | |
Other expense, net (Interest income) | | | Interest income | | | | | 19 | | | | | | 28 | | |
Income tax expense | | | Provision (benefit) for income taxes | | | | | 1,521 | | | | | | (759) | | |
Description | | | Estimated Fair Value | | | Estimated Remaining Useful Life | | |||
Land | | | | $ | 7,007 | | | | N/A | |
Building and site improvements | | | | | 71,788 | | | | 15 years | |
Construction in progress | | | | | 30,768 | | | | N/A | |
Personal property | | | | | 192,400 | | | | 7 years | |
Total | | | | $ | 301,963 | | | | | |
|
(dollars in thousands) | | | Year ended December 31, 2017 | | | Nine months ended June 30, 2018 | | ||||||
Total Depreciation expense for property and equipment, net | | | | $ | 32,272 | | | | | $ | 24,204 | | |
Elimination of pre-acquisition historical depreciation expense | | | | | | | | | | | | | |
Ply Gem (Successor) | | | | | | | | | | | (6,985) | | |
Ply Gem (Predecessor) | | | | | (31,976) | | | | | | (17,296) | | |
Atrium | | | | | (6,701) | | | | | | (3,577) | | |
Net adjustments to depreciation expense | | | | $ | (6,405) | | | | | $ | (3,654) | | |
Allocation of adjustments: | | | | | | | | | | | | | |
Cost of products sold | | | | | (5,173) | | | | | | (2,953) | | |
Selling, general and administrative expenses | | | | | (1,232) | | | | | | (701) | | |
Total | | | | $ | (6,405) | | | | | $ | (3,654) | | |
|
(dollars in thousands) | | | Year ended December 31, 2017 | | | Nine months ended June 30, 2018 | | ||||||
Total Amortization expense for intangible assets | | | | $ | 112,640 | | | | | $ | 84,480 | | |
Elimination of pre-acquisition historical amortization expense | | | | | | | | | | | | | |
Ply Gem (Successor) | | | | | | | | | | | (24,096) | | |
Ply Gem (Predecessor) | | | | | (21,271) | | | | | | (11,433) | | |
Atrium | | | | | (6,723) | | | | | | (3,677) | | |
Net adjustments to amortization expense | | | | $ | 84,646 | | | | | $ | 45,274 | | |
|
(dollars in thousands) | | | Year ended December 31, 2017 | | | Nine months ended June 30, 2018 | | ||||||
Cash interest expense | | | | $ | 163,762 | | | | | $ | 122,326 | | |
Amortization of debt issuance cost | | | | | 9,770 | | | | | | 7,557 | | |
Amortization of original issue discount | | | | | 1,062 | | | | | | 822 | | |
Total pro forma interest expense on new debt | | | | $ | 174,594 | | | | | $ | 130,705 | | |
Less: interest expense on new debt already recorded (successor debt) | | | | | — | | | | | | (43,680) | | |
Net adjustment to Interest Expense | | | | $ | 174,594 | | | | | $ | 87,025 | | |
|
(dollars in thousands) | | | Principal Amount | | | Amount Drawn | | | Capacity | | | Coupon Rate plus Libor – Drawn | | | Undrawn Fee | | | Year ended December 31, 2017 | | | Nine months ended June 30, 2018 | | |||||||||||||||||||||
ABL and Cash Flows Revolvers | | | | | N/A | | | | | $ | 130,000 | | | | | $ | 360,000 | | | | | | 3.83% | | | | | | 0.25% | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | $ | 115,000 | | | | | | 5.33% | | | | | | 0.50% | | | | | | | | | | |||||
Cash interest expense | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | $ | 6,131 | | | | | $ | 4,598 | | |
Original issue discount amortization | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | — | | | | | | — | | |
Deferred financing costs amortization | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1,712 | | | | | | 1,284 | | |
Total | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | $ | 7,843 | | | | | $ | 5,882 | | |
Term Loan | | | | $ | 1,755,000 | | | | | | N/A | | | | | | N/A | | | | | | 6.08% | | | | | | N/A | | | | | | | | | | | | | | |
Cash interest expense | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | $ | 106,031 | | | | | $ | 79,028 | | |
Original issue discount amortization | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1,062 | | | | | | 822 | | |
Deferred financing costs amortization | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 5,625 | | | | | | 4,355 | | |
Total | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | $ | 112,718 | | | | | $ | 84,205 | | |
Senior notes | | | | $ | 645,000 | | | | | | N/A | | | | | | N/A | | | | | | 8.00% | | | | | | N/A | | | | | | | | | | | | | | |
Cash interest expense | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | $ | 51,600 | | | | | $ | 38,700 | | |
Original issue discount amortization | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | — | | | | | | — | | |
Deferred financing costs amortization | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 2,433 | | | | | | 1,918 | | |
Total | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | $ | 54,033 | | | | | $ | 40,618 | | |
Total interest expense | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | $ | 174,594 | | | | | $ | 130,705 | | |
|
| | Beneficial Ownership(1) | | | Beneficial Ownership(1) | | ||||||||||||||||||||
Name of Beneficial Owner or Group | | Number of Shares Common Stock | | Percent | | | Number of Shares Common Stock | | Percent | | ||||||||||||||||
Clayton Dubilier & Rice Fund VIII, L.P.(2) | | | | 22,744,822 | | | | | 34.36 | | | | | | 22,744,822 | | | | | 34.36 | | | ||||
CD&R Friends & Family Fund VIII, L.P.(2) | | | | 56,941 | | | | | * | | | | | | 56,941 | | | | | * | | | ||||
Kathleen J. Affeldt(3) | | | | 32,736 | | | | | * | | | | | | 32,736 | | | | | * | | | ||||
George L. Ball(3) | | | | 70,211 | | | | | * | | | | | | 70,211 | | | | | * | | | ||||
James G. Berges(3)(4) | | | | 34,630 | | | | | * | | | | | | 34,630 | | | | | * | | | ||||
Gary L. Forbes(3) | | | | 62,273 | | | | | * | | | | | | 62,273 | | | | | * | | | ||||
John J. Holland(3) | | | | 16,000 | | | | | * | | | | | | 16,000 | | | | | * | | | ||||
Lawrence J. Kremer(3) | | | | 30,014 | | | | | * | | | | | | 30,014 | | | | | * | | | ||||
John L. Kuzdal(3) | | | | 91,989 | | | | | * | | | | | | 91,989 | | | | | * | | | ||||
George Martinez(3) | | | | 51,345 | | | | | * | | | | | | 51,345 | | | | | * | | | ||||
James S. Metcalf(3) | | | | 30,000 | | | | | * | | | | | | 30,000 | | | | | * | | | ||||
Todd R. Moore(3) | | | | 35,639 | | | | | * | | | | | | 35,639 | | | | | * | | | ||||
Donald R. Riley(3) | | | | 72,603 | | | | | * | | | | | | 72,603 | | | | | * | | | ||||
Nathan K. Sleeper(3)(4) | | | | 34,630 | | | | | * | | | | | | 34,630 | | | | | * | | | ||||
Katy K. Theroux(3) | | | | 20,428 | | | | | * | | | | | | 20,428 | | | | | * | | | ||||
William R. VanArsdale(3) | | | | 0 | | | | | * | | | | | | 0 | | | | | * | | | ||||
Jonathan L. Zrebiec(3)(4) | | | | 34,630 | | | | | * | | | | | | 34,630 | | | | | * | | | ||||
All directors and executive officers as a group (19 persons)(4)(5) | | | | 545,126 | | | | | 8.23 | | | | | | 545,126 | | | | | 0.82 | | |
| | | Options | | | Unvested Restricted Stock (included in the table above) | | | Unvested Restricted Stock Units (not included in the table above) | | |||||||||||||||
| | | Exercisable (included in the table above) | | | Not Exercisable Within 60 Days (not included in the table above) | | ||||||||||||||||||
Kathleen J. Affeldt | | | | | — | | | | | | — | | | | | | 879 | | | | | | 5,580 | | |
George L. Ball | | | | | — | | | | | | — | | | | | | 879 | | | | | | 5,580 | | |
James G. Berges(4) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Gary L. Forbes | | | | | 12,405 | | | | | | 1,758 | | | | | | — | | | | | | 5,580 | | |
John J. Holland | | | | | 36,380 | | | | | | 879 | | | | | | 440 | | | | | | 5,580 | | |
Lawrence J. Kremer | | | | | 9,234 | | | | | | — | | | | | | 879 | | | | | | 5,580 | | |
John L. Kuzdal | | | | | 150,148 | | | | | | — | | | | | | — | | | | | | 27,433 | | |
George Martinez | | | | | — | | | | | | — | | | | | | 879 | | | | | | 5,580 | | |
James Metcalf | | | | | — | | | | | | — | | | | | | — | | | | | | 11,159 | | |
Todd R. Moore | | | | | — | | | | | | — | | | | | | — | | | | | | 25,214 | | |
Donald R. Riley | | | | | — | | | | | | — | | | | | | 5,513 | | | | | | 87,421 | | |
Nathan K. Sleeper(4) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Katy K. Theroux | | | | | — | | | | | | — | | | | | | 1,900 | | | | | | 26,988 | | |
William R. VanArsdale | | | | | — | | | | | | — | | | | | | — | | | | | | 5,580 | | |
Jonathan L. Zrebiec(4) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| | | Options | | | Unvested Restricted Stock (included in the table above) | | | Unvested Restricted Stock Units (not included in the table above) | | |||||||||||||||
| | | Exercisable (included in the table above) | | | Not Exercisable Within 60 Days (not included in the table above) | | ||||||||||||||||||
Bradley S. Little | | | | | — | | | | | | — | | | | | | — | | | | | | 17,079 | | |
Robert D. Ronchetto | | | | | — | | | | | | — | | | | | | — | | | | | | 14,811 | | |
NCI SEC Filings (File No. 001-32367) | | | Period or File Date | |
Annual Report on Form 10-K | | | Year ended October 29, 2017 | |
Quarterly Reports on Form 10-Q | | | Quarterly periods ended January 28, 2018, April 29, 2018 and July 29, 2018 | |
Current Reports on Form 8-K and 8-K/A | | | Filed on June 20, 2018, July 18, 2018, July 19, 2018, July 31, 2018, August 7, 2018 and August 28, 2018 | |
| | | | | F-3 | | | |
| Audited Financial Statements: | | | |||||
| | | | | F-4 | | | |
| | | | | F-5 | | | |
| | | | | F-6 | | | |
| | | | | F-7 | | | |
| | | | | F-8 | | | |
| | | | | F-9 | | | |
| | | | | F-57 | | | |
| Unaudited Financial Statements: | | | |||||
| | | | | F-85 | | | |
| | | | | F-86 | | | |
| | | | | F-87 | | | |
| | | | | F-88 | | | |
| | | | | F-89 | | | |
| | | | | F-121 | | | |
| | | | | | | ||
| | | | | | | ||
| Atrium Corporation | | | |||||
| | | | | | | ||
| Audited Financial Statements: | | | |||||
| | | | | | | ||
| | | | | | | ||
| | | | | | | ||
| | | | | | | ||
| | | | | | | ||
| | | | | | | ||
| | | | | | |
| Audited Financial Statements: | | | |||||
| | | | | | | ||
| | | | | | | ||
| | | | | | | ||
| | | | | | | ||
| | | | | | | ||
| Unaudited Financial Statements: | | | |||||
| | | | | | | ||
| | | | | | | ||
| | | | | | | ||
| | | | | | | ||
| | | | | | |
(Amounts in thousands, except share and per share data) | | | For the Year Ended December 31, | | |||||||||||||||
| | | 2017 | | | 2016 | | | 2015 | | |||||||||
Net sales | | | | $ | 2,056,303 | | | | | $ | 1,911,844 | | | | | $ | 1,839,726 | | |
Cost of products sold | | | | | 1,587,790 | | | | | | 1,449,570 | | | | | | 1,420,014 | | |
Gross profit | | | | | 468,513 | | | | | | 462,274 | | | | | | 419,712 | | |
Operating expenses: | | | | | |||||||||||||||
Selling, general and administrative expenses | | | | | 272,984 | | | | | | 268,714 | | | | | | 271,874 | | |
Amortization of intangible assets | | | | | 21,271 | | | | | | 25,064 | | | | | | 25,306 | | |
Total operating expenses | | | | | 294,255 | | | | | | 293,778 | | | | | | 297,180 | | |
Operating earnings | | | | | 174,258 | | | | | | 168,496 | | | | | | 122,532 | | |
Foreign currency gain (loss) | | | | | 1,363 | | | | | | 299 | | | | | | (3,166) | | |
Interest expense | | | | | (69,361) | | | | | | (72,718) | | | | | | (74,876) | | |
Interest income | | | | | 78 | | | | | | 36 | | | | | | 57 | | |
Tax receivable agreement liability adjustment | | | | | 10,749 | | | | | | (60,874) | | | | | | (12,947) | | |
Loss on modification or extinguishment of debt | | | | | (2,106) | | | | | | (11,747) | | | | | | — | | |
Income before provision (benefit) for income taxes | | | | | 114,981 | | | | | | 23,492 | | | | | | 31,600 | | |
Provision (benefit) for income taxes | | | | | 46,654 | | | | | | (51,995) | | | | | | (688) | | |
Net income | | | | $ | 68,327 | | | | | $ | 75,487 | | | | | $ | 32,288 | | |
Net income attributable to common shareholders: | | | | | |||||||||||||||
Basic | | | | $ | 1.00 | | | | | $ | 1.11 | | | | | $ | 0.47 | | |
Diluted | | | | $ | 0.99 | | | | | $ | 1.10 | | | | | $ | 0.47 | | |
Weighted average shares outstanding: | | | | | |||||||||||||||
Basic | | | | | 68,443,480 | | | | | | 68,176,801 | | | | | | 68,003,564 | | |
Diluted | | | | | 69,006,968 | | | | | | 68,324,146 | | | | | | 68,106,493 | | |
(Amounts in thousands) | | | For the Year Ended December 31, | | |||||||||||||||
| | | 2017 | | | 2016 | | | 2015 | | |||||||||
Net income | | | | $ | 68,327 | | | | | $ | 75,487 | | | | | $ | 32,288 | | |
Other comprehensive income (loss), net of tax: | | | | | |||||||||||||||
Currency translation | | | | | 3,765 | | | | | | 2,950 | | | | | | (14,690) | | |
Unrealized gain (loss) on derivative instruments | | | | | (853) | | | | | | 29 | | | | | | (465) | | |
Minimum pension liability for actuarial gain (loss) | | | | | 610 | | | | | | 295 | | | | | | (1,436) | | |
Other comprehensive income (loss) | | | | | 3,522 | | | | | | 3,274 | | | | | | (16,591) | | |
Comprehensive income | | | | $ | 71,849 | | | | | $ | 78,761 | | | | | $ | 15,697 | | |
|
(Amounts in thousands, except share amounts) | | | December 31, 2017 | | | December 31, 2016 | | ||||||
ASSETS | | | | ||||||||||
Current Assets: | | | | ||||||||||
Cash and cash equivalents | | | | $ | 71,416 | | | | | $ | 51,597 | | |
Accounts receivable, less allowances of $3,137 and $2,663, respectively | | | | | 249,533 | | | | | | 209,919 | | |
Inventories: | | | | ||||||||||
Raw materials | | | | | 79,330 | | | | | | 69,639 | | |
Work in process | | | | | 36,440 | | | | | | 24,621 | | |
Finished goods | | | | | 80,721 | | | | | | 67,696 | | |
Total inventory | | | | | 196,491 | | | | | | 161,956 | | |
Prepaid expenses and other current assets | | | | | 45,900 | | | | | | 26,850 | | |
Total current assets | | | | | 563,340 | | | | | | 450,322 | | |
Property and Equipment, at cost: | | | | ||||||||||
Land | | | | | 8,229 | | | | | | 8,249 | | |
Buildings and improvements | | | | | 68,005 | | | | | | 67,951 | | |
Machinery and equipment | | | | | 450,554 | | | | | | 413,565 | | |
Total property and equipment | | | | | 526,788 | | | | | | 489,765 | | |
Less accumulated depreciation | | | | | (352,256) | | | | | | (324,209) | | |
Total property and equipment, net | | | | | 174,532 | | | | | | 165,556 | | |
Other Assets: | | | | ||||||||||
Intangible assets, net | | | | | 83,675 | | | | | | 104,159 | | |
Goodwill | | | | | 480,563 | | | | | | 478,514 | | |
Deferred income taxes | | | | | 10,523 | | | | | | 50,347 | | |
Other | | | | | 6,934 | | | | | | 8,843 | | |
Total other assets | | | | | 581,695 | | | | | | 641,863 | | |
| | | | $ | 1,319,567 | | | | | $ | 1,257,741 | | |
LIABILITIES AND STOCKHOLDERS’ EQUITY | | | | ||||||||||
Current Liabilities: | | | | ||||||||||
Accounts payable | | | | $ | 85,720 | | | | | $ | 75,398 | | |
Accrued expenses | | | | | 185,857 | | | | | | 169,015 | | |
Current portion of payable to related parties pursuant to tax receivable agreement | | | | | 51,356 | | | | | | 25,383 | | |
Current portion of long term debt | | | | | 4,300 | | | | | | 4,300 | | |
Total current liabilities | | | | | 327,233 | | | | | | 274,096 | | |
Deferred income taxes | | | | | 1,530 | | | | | | 2,722 | | |
Long-term portion of payable to related parties pursuant to tax receivable agreement | | | | | 18,125 | | | | | | 54,336 | | |
Other long-term liabilities | | | | | 83,424 | | | | | | 86,395 | | |
Long-term debt | | | | | 807,334 | | | | | | 836,086 | | |
Commitments and contingencies | | | | ||||||||||
Stockholders’ Equity | | | | ||||||||||
Preferred stock $0.01 par, 50,000,000 shares authorized, none issued and outstanding | | | | | — | | | | | | — | | |
Common stock $0.01 par, 250,000,000 shares authorized, 68,515,697 and 68,269,749 issued and outstanding, respectively | | | | | 685 | | | | | | 683 | | |
Additional paid-in-capital | | | | | 756,096 | | | | | | 751,452 | | |
Accumulated deficit | | | | | (645,090) | | | | | | (714,737) | | |
Accumulated other comprehensive loss | | | | | (29,770) | | | | | | (33,292) | | |
Total stockholders’ equity | | | | | 81,921 | | | | | | 4,106 | | |
| | | | $ | 1,319,567 | | | | | $ | 1,257,741 | | |
(Amounts in thousands) | | | For the Year Ended December 31, | | |||||||||||||||
| | | 2017 | | | 2016 | | | 2015 | | |||||||||
Cash flows from operating activities: | | | | | |||||||||||||||
Net income | | | | $ | 68,327 | | | | | $ | 75,487 | | | | | $ | 32,288 | | |
Adjustments to reconcile net income to cash provided by operating activities | | | | | |||||||||||||||
Depreciation and amortization expense | | | | | 53,247 | | | | | | 56,403 | | | | | | 58,400 | | |
Fair-value premium on purchased inventory | | | | | — | | | | | | — | | | | | | 54 | | |
Non-cash restructuring costs | | | | | 1,321 | | | | | | 427 | | | | | | 704 | | |
Non-cash interest expense, net | | | | | 14,044 | | | | | | 13,710 | | | | | | 13,380 | | |
(Gain) loss on foreign currency transactions | | | | | (1,363) | | | | | | (299) | | | | | | 3,166 | | |
Non-cash litigation expense | | | | | 650 | | | | | | 1,875 | | | | | | — | | |
Loss on modification or extinguishment of debt | | | | | 2,106 | | | | | | 11,747 | | | | | | — | | |
Stock based compensation | | | | | 1,345 | | | | | | 1,067 | | | | | | 1,960 | | |
Deferred income taxes | | | | | 39,623 | | | | | | (57,989) | | | | | | (4,901) | | |
Tax receivable agreement liability adjustment | | | | | (10,749) | | | | | | 60,874 | | | | | | 12,947 | | |
Increase (reduction) in tax uncertainty, net of valuation allowance | | | | | 604 | | | | | | 1,059 | | | | | | (199) | | |
(Gain) loss on sale of building | | | | | (1,880) | | | | | | — | | | | | | — | | |
Other | | | | | (175) | | | | | | (190) | | | | | | (28) | | |
Changes in operating assets and liabilities: | | | | | |||||||||||||||
Accounts receivable, net | | | | | (39,431) | | | | | | (14,709) | | | | | | (4,562) | | |
Inventories | | | | | (34,483) | | | | | | (11,542) | | | | | | 29,921 | | |
Prepaid expenses and other assets | | | | | (2,066) | | | | | | (2,967) | | | | | | 6,729 | | |
Accounts payable | | | | | 10,473 | | | | | | 945 | | | | | | (10,563) | | |
Accrued expenses | | | | | (8,450) | | | | | | 9,037 | | | | | | 3,336 | | |
Cash payments on restructuring liabilities | | | | | (983) | | | | | | (540) | | | | | | (1,645) | | |
Insurance proceeds in advance of settlement | | | | | 8,725 | | | | | | — | | | | | | — | | |
Other | | | | | 1,043 | | | | | | 647 | | | | | | (1,624) | | |
Net cash provided by operating activities | | | | | 101,928 | | | | | | 145,042 | | | | | | 139,363 | | |
Cash flows from investing activities: | | | | | |||||||||||||||
Acquisitions, net of cash acquired and outstanding checks assumed | | | | | — | | | | | | — | | | | | | (21,000) | | |
Capital expenditures | | | | | (40,386) | | | | | | (36,001) | | | | | | (33,860) | | |
Proceeds from sale of assets | | | | | 2,514 | | | | | | 183 | | | | | | 122 | | |
Net cash used in investing activities | | | | | (37,872) | | | | | | (35,818) | | | | | | (54,738) | | |
Cash flows from financing activities: | | | | | |||||||||||||||
Payments on long-term debt | | | | | (44,300) | | | | | | (164,300) | | | | | | (4,300) | | |
Payments to tax authority for employee stock based compensation | | | | | (1,186) | | | | | | — | | | | | | — | | |
Proceeds from exercises of employee stock options | | | | | 1,203 | | | | | | 1,091 | | | | | | 2,198 | | |
Cash payments on tax receivable agreement | | | | | — | | | | | | (4,971) | | | | | | (48) | | |
Debt issuance costs paid | | | | | — | | | | | | — | | | | | | (1,412) | | |
Net cash used in financing activities | | | | | (44,283) | | | | | | (168,180) | | | | | | (3,562) | | |
Impact of exchange rate movements on cash | | | | | 46 | | | | | | 1,128 | | | | | | (4,800) | | |
Net cash increase (decrease) in cash and cash equivalents | | | | | 19,819 | | | | | | (57,828) | | | | | | 76,263 | | |
Cash and cash equivalents at the beginning of the period | | | | | 51,597 | | | | | | 109,425 | | | | | | 33,162 | | |
Cash and cash equivalents at the end of the period | | | | $ | 71,416 | | | | | $ | 51,597 | | | | | $ | 109,425 | | |
Supplemental Information | | | | | |||||||||||||||
Interest paid | | | | $ | 54,677 | | | | | $ | 58,745 | | | | | $ | 60,070 | | |
Income taxes paid, net | | | | $ | 7,169 | | | | | $ | 7,024 | | | | | $ | 2,607 | | |
(Amounts in thousands) | | | Common Stock | | | Additional Paid-in- Capital | | | Accumulated Deficit | | | Accumulated Other Comprehensive Income (Loss) | | | Total Stockholders’ Equity (Deficit) | | |||||||||||||||||||||
| | | Shares | | | Amount | | ||||||||||||||||||||||||||||||
Balance, December 31, 2014 | | | | | 67,877,587 | | | | | $ | 679 | | | | | $ | 745,140 | | | | | $ | (822,512) | | | | | $ | (19,975) | | | | | $ | (96,668) | | |
Comprehensive loss: | | | | | | | | ||||||||||||||||||||||||||||||
Net income | | | | | — | | | | | | — | | | | | | — | | | | | | 32,288 | | | | | | — | | | | | | 32,288 | | |
Other comprehensive loss | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (16,591) | | | | | | (16,591) | | |
Stock compensation | | | | | — | | | | | | — | | | | | | 1,960 | | | | | | — | | | | | | — | | | | | | 1,960 | | |
Stock option exercises | | | | | 249,904 | | | | | | 2 | | | | | | 2,196 | | | | | | — | | | | | | — | | | | | | 2,198 | | |
Balance, December 31, 2015 | | | | | 68,127,491 | | | | | $ | 681 | | | | | $ | 749,296 | | | | | $ | (790,224) | | | | | $ | (36,566) | | | | | $ | (76,813) | | |
Comprehensive income: | | | | | | | | ||||||||||||||||||||||||||||||
Net income | | | | | — | | | | | | — | | | | | | — | | | | | | 75,487 | | | | | | — | | | | | | 75,487 | | |
Other comprehensive income | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 3,274 | | | | | | 3,274 | | |
Stock compensation | | | | | — | | | | | | — | | | | | | 1,067 | | | | | | — | | | | | | — | | | | | | 1,067 | | |
Stock option exercises | | | | | 142,258 | | | | | | 2 | | | | | | 1,089 | | | | | | — | | | | | | — | | | | | | 1,091 | | |
Balance, December 31, 2016 | | | | | 68,269,749 | | | | | $ | 683 | | | | | $ | 751,452 | | | | | $ | (714,737) | | | | | $ | (33,292) | | | | | $ | 4,106 | | |
Comprehensive income: | | | | | | | | ||||||||||||||||||||||||||||||
Net income | | | | | — | | | | | | — | | | | | | — | | | | | | 68,327 | | | | | | — | | | | | | 68,327 | | |
Other comprehensive income | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 3,522 | | | | | | 3,522 | | |
Stock compensation | | | | | — | | | | | | — | | | | | | 1,345 | | | | | | — | | | | | | — | | | | | | 1,345 | | |
Cumulative-effect adjustment from adoption of ASU 2016-09 | | | | | — | | | | | | — | | | | | | — | | | | | | 1,320 | | | | | | — | | | | | | 1,320 | | |
Stock issued pursuant to the Long-Term Incentive Plan | | | | | 129,176 | | | | | | 1 | | | | | | 2,097 | | | | | | — | | | | | | — | | | | | | 2,098 | | |
Stock option exercises | | | | | 116,772 | | | | | | 1 | | | | | | 1,202 | | | | | | — | | | | | | — | | | | | | 1,203 | | |
Balance, December 31, 2017 | | | | | 68,515,697 | | | | | $ | 685 | | | | | $ | 756,096 | | | | | $ | (645,090) | | | | | $ | (29,770) | | | | | $ | 81,921 | | |
|
| Buildings and improvements | | | 10 – 37 years | |
| Machinery and equipment, including leases | | | 3 – 15 years | |
| Leasehold improvements | | | Term of lease or useful life, whichever is shorter | |
(Amounts in thousands) | | | December 31, 2017 | | | December 31, 2016 | | ||||||
Foreign currency hedge (included in other assets) | | | | $ | 6 | | | | | $ | 962 | | |
Description (Amounts in thousands) | | | Carrying Value | | | Fair Value Total | | | Quoted Prices in Active Markets for Identical Assets (Level 1) | | | Significant Other Observable Inputs (Level 2) | | | Significant Unobservable Inputs (Level 3) | | |||||||||||||||
Liabilities: | | | | | | | |||||||||||||||||||||||||
Senior Notes – 6.50% | | | | $ | 650,000 | | | | | $ | 671,970 | | | | | $ | 671,970 | | | | | $ | — | | | | | $ | — | | |
Term Loan Facility | | | | | 213,875 | | | | | | 215,479 | | | | | | — | | | | | | 215,479 | | | | | | — | | |
As of December 31, 2017 | | | | $ | 863,875 | | | | | $ | 887,449 | | | | | $ | 671,970 | | | | | $ | 215,479 | | | | | $ | — | | |
Liabilities: | | | | | | | |||||||||||||||||||||||||
Senior Notes – 6.50% | | | | $ | 650,000 | | | | | $ | 676,000 | | | | | $ | 676,000 | | | | | $ | — | | | | | $ | — | | |
Term Loan Facility | | | | | 258,175 | | | | | | 260,757 | | | | | | — | | | | | | 260,757 | | | | | | — | | |
As of December 31, 2016 | | | | $ | 908,175 | | | | | $ | 936,757 | | | | | $ | 676,000 | | | | | $ | 260,757 | | | | | $ | — | | |
|
(Amounts in thousands) | | | Foreign currency translation | | | Unrealized gain (loss) on derivative instruments | | | Minimum pension liability adjustments | | | Accumulated other comprehensive (loss) income | | ||||||||||||
Balance, December 31, 2014 | | | | $ | (6,731) | | | | | $ | 1,294 | | | | | $ | (14,538) | | | | | $ | (19,975) | | |
Net current period change | | | | | (14,690) | | | | | | (465) | | | | | | (1,436) | | | | | | (16,591) | | |
Balance, December 31, 2015 | | | | | (21,421) | | | | | | 829 | | | | | | (15,974) | | | | | | (36,566) | | |
Net current period change | | | | | 2,950 | | | | | | 29 | | | | | | 295 | | | | | | 3,274 | | |
Balance, December 31, 2016 | | | | | (18,471) | | | | | | 858 | | | | | | (15,679) | | | | | | (33,292) | | |
Net current period change | | | | | 3,765 | | | | | | (853) | | | | | | 610 | | | | | | 3,522 | | |
Balance, December 31, 2017 | | | | $ | (14,706) | | | | | $ | 5 | | | | | $ | (15,069) | | | | | $ | (29,770) | | |
|
(Amounts in thousands) | | | |||||
Accounts receivable | | | | $ | 3,559 | | |
Inventories | | | | | 712 | | |
Prepaid expenses and other current assets | | | | | 41 | | |
Property and equipment | | | | | 2,019 | | |
Intangible assets | | | | | 9,300 | | |
Goodwill | | | | | 7,642 | | |
Accounts payable, accrued expenses and other long-term liabilities | | | | | (2,273) | | |
| | | | $ | 21,000 | | |
|
(Amounts in thousands) (Unaudited) | | | December 31, 2015 | | |||
Net sales | | | | $ | 1,850,993 | | |
Net income | | | | | 32,712 | | |
(Amounts in thousands) | | | December 31, 2017 | | | December 31, 2016 | | ||||||
Siding, Fencing and Stone | | | | $ | 349,954 | | | | | $ | 348,553 | | |
Windows and Doors | | | | | 130,609 | | | | | | 129,961 | | |
| | | | $ | 480,563 | | | | | $ | 478,514 | | |
|
(Amounts in thousands) | | | Windows and Doors | | | Siding, Fencing and Stone | | ||||||
Balance as of January 1, 2016 | | | | ||||||||||
Goodwill | | | | $ | 457,554 | | | | | $ | 470,185 | | |
Accumulated impairment losses | | | | | (327,773) | | | | | | (122,227) | | |
| | | | $ | 129,781 | | | | | $ | 347,958 | | |
Currency translation adjustments | | | | | 180 | | | | | | 595 | | |
Balance as of December 31, 2016 | | | | ||||||||||
Goodwill | | | | | 457,734 | | | | | | 470,780 | | |
Accumulated impairment losses | | | | | (327,773) | | | | | | (122,227) | | |
| | | | $ | 129,961 | | | | | $ | 348,553 | | |
Currency translation adjustments | | | | | 648 | | | | | | 1,401 | | �� |
Balance as of December 31, 2017 | | | | ||||||||||
Goodwill | | | | | 458,382 | | | | | | 472,181 | | |
Accumulated impairment losses | | | | | (327,773) | | | | | | (122,227) | | |
| | | | $ | 130,609 | | | | | $ | 349,954 | | |
|
(Amounts in thousands) | | | Average Amortization Period (in Years) | | | Cost | | | Accumulated Amortization | | | Net Carrying Value | | ||||||||||||
As of December 31, 2017 | | | | | | ||||||||||||||||||||
Patents | | | | | 14 | | | | | $ | 12,770 | | | | | $ | (12,261) | | | | | $ | 509 | | |
Trademarks/Tradenames | | | | | 12 | | | | | | 117,473 | | | | | | (88,853) | | | | | | 28,620 | | |
Customer relationships | | | | | 13 | | | | | | 219,614 | | | | | | (166,086) | | | | | | 53,528 | | |
Other | | | | | 4 | | | | | | 5,750 | | | | | | (4,732) | | | | | | 1,018 | | |
Total intangible assets | | | | | 12 | | | | | $ | 355,607 | | | | | $ | (271,932) | | | | | $ | 83,675 | | |
As of December 31, 2016 | | | | | | ||||||||||||||||||||
Patents | | | | | 14 | | | | | $ | 12,770 | | | | | $ | (12,078) | | | | | $ | 692 | | |
Trademarks/Tradenames | | | | | 12 | | | | | | 117,124 | | | | | | (82,723) | | | | | | 34,401 | | |
Customer relationships | | | | | 13 | | | | | | 217,861 | | | | | | (150,310) | | | | | | 67,551 | | |
Other | | | | | 4 | | | | | | 5,661 | | | | | | (4,146) | | | | | | 1,515 | | |
Total intangible assets | | | | | 12 | | | | | $ | 353,416 | | | | | $ | (249,257) | | | | | $ | 104,159 | | |
|
(Amounts in thousands) | | | Amortization expense | | |||
2018 | | | | $ | 19,781 | | |
2019 | | | | | 15,734 | | |
2020 | | | | | 11,197 | | |
2021 | | | | | 6,718 | | |
2022 | | | | | 4,416 | | |
(Amounts in thousands) | | | December 31, 2017 | | | December 31, 2016 | | ||||||
Senior secured asset based revolving credit facility | | | | $ | — | | | | | $ | — | | |
Term Loan due 2021, net of unamortized early tender premium, discount, and debt issuance costs of $10,560 and $17,854, respectively | | | | | 203,315 | | | | | | 240,321 | | |
6.50% Senior notes due 2022, net of unamortized early tender premium, discount, and debt issuance costs of $41,681 and $49,935, respectively | | | | | 608,319 | | | | | | 600,065 | | |
| | | | $ | 811,634 | | | | | $ | 840,386 | | |
Less current portion of long-term debt | | | | | (4,300) | | | | | | (4,300) | | |
| | | | $ | 807,334 | | | | | $ | 836,086 | | |
|
(Amounts in thousands) | | | For the year ended | | |||||||||
| December 31, 2017 | | | December 31, 2016 | | ||||||||
Loss on modification of debt: | | | | ||||||||||
Term Loan Facility unamortized discount | | | | $ | (1,681) | | | | | $ | (9,375) | | |
Term Loan Facility unamortized debt issuance costs | | | | | (425) | | | | | | (2,372) | | |
Total loss on modification or extinguishment of debt | | | | $ | (2,106) | | | | | $ | (11,747) | | |
|
(Amounts in thousands) | | | As of December 31, 2017 | | |||
2018 | | | | $ | 4,300 | | |
2019 | | | | | 4,300 | | |
2020 | | | | | 4,300 | | |
2021 | | | | | 200,975 | | |
2022 | | | | | 650,000 | | |
Thereafter | | | | | — | | |
| | | | $ | 863,875 | | |
|
(Amounts in thousands) | | | December 31, 2017 | | | December 31, 2016 | | ||||||
Change in projected benefit obligation: | | | | ||||||||||
Benefit obligation at beginning of year | | | | $ | 47,138 | | | | | $ | 47,652 | | |
Service cost | | | | | — | | | | | | — | | |
Interest cost | | | | | 1,822 | | | | | | 1,914 | | |
Actuarial (gain) loss | | | | | 2,226 | | | | | | (227) | | |
Benefits and expenses paid | | | | | (2,669) | | | | | | (2,201) | | |
Projected benefit obligation at end of year | | | | $ | 48,517 | | | | | $ | 47,138 | | |
Change in plan assets: | | | | ||||||||||
Fair value of plan assets at beginning of year | | | | $ | 31,478 | | | | | $ | 31,972 | | |
Actual return on plan assets | | | | | 3,792 | | | | | | 1,060 | | |
Employer and participant contributions | | | | | 1,753 | | | | | | 647 | | |
Benefits and expenses paid | | | | | (2,669) | | | | | | (2,201) | | |
Fair value of plan assets at end of year | | | | $ | 34,354 | | | | | $ | 31,478 | | |
Funded status and financial position: | | | | ||||||||||
Fair value of plan assets | | | | $ | 34,354 | | | | | $ | 31,478 | | |
Benefit obligation at end of year | | | | | 48,517 | | | | | | 47,138 | | |
Funded status | | | | $ | (14,163) | | | | | $ | (15,660) | | |
|
(Amounts in thousands) | | | December 31, 2017 | | | December 31, 2016 | | ||||||
Amount recognized in the balance sheet consists of: | | | | ||||||||||
Current liability | | | | $ | (1,358) | | | | | $ | (1,753) | | |
Noncurrent liability | | | | | (12,805) | | | | | | (13,907) | | |
Liability recognized in the balance sheet | | | | $ | (14,163) | | | | | $ | (15,660) | | |
|
(Amounts in thousands) | | | December 31, 2017 | | | December 31, 2016 | | ||||||
Initial net asset (obligation) | | | | $ | — | | | | | $ | — | | |
Prior service credit (cost) | | | | | — | | | | | | — | | |
Net loss | | | | | 17,958 | | | | | | 18,817 | | |
Accumulated other comprehensive loss | | | | $ | 17,958 | | | | | $ | 18,817 | | |
|
| | | For the year ended December 31, | | |||||||||||||||
| | | 2017 | | | 2016 | | | 2015 | | |||||||||
Discount rate for projected benefit obligation | | | | | 3.50% | | | | | | 3.97% | | | | | | 4.18% | | |
Discount rate for pension costs | | | | | 3.97% | | | | | | 4.18% | | | | | | 4.25% | | |
Expected long-term average return on plan assets | | | | | 7.00% | | | | | | 7.00% | | | | | | 7.00% | | |
(Amounts in thousands) | | | For the year ended December 31, | | |||||||||||||||
| 2017 | | | 2016 | | | 2015 | | |||||||||||
Service cost | | | | $ | — | | | | | $ | — | | | | | $ | — | | |
Interest cost | | | | | 1,822 | | | | | | 1,914 | | | | | | 1,996 | | |
Expected return on plan assets | | | | | (2,184) | | | | | | (2,176) | | | | | | (2,309) | | |
Amortization of (gain) loss | | | | | 1,432 | | | | | | 1,348 | | | | | | 1,192 | | |
Net periodic benefit expense | | | | $ | 1,070 | | | | | $ | 1,086 | | | | | $ | 879 | | |
|
| | | Target Allocation | | | Actual allocation as of December 31, 2017 | | | Weighted Average Expected Long- Term Rate of Return(1) | | |||||||||
Asset Category | | | | | |||||||||||||||
U.S. Large Cap Funds | | | | | 25.0% | | | | | | 22.3% | | | | | | 3.7% | | |
U.S. Mid Cap Funds | | | | | 5.0% | | | | | | 8.1% | | | | | | 0.8% | | |
U.S. Small Cap Funds | | | | | 3.0% | | | | | | 3.0% | | | | | | 0.4% | | |
International Equity | | | | | 15.0% | | | | | | 15.2% | | | | | | 1.1% | | |
Fixed income | | | | | 45.0% | | | | | | 44.4% | | | | | | 0.9% | | |
Other investments | | | | | 7.0% | | | | | | 7.0% | | | | | | 0.1% | | |
| | | | | 100.0% | | | | | | 100.0% | | | | | | 7.0% | | |
| | | Target Allocation | | | Actual allocation as of December 31, 2016 | | | Weighted Average Expected Long- Term Rate of Return(1) | | |||||||||
Asset Category | | | | | |||||||||||||||
U.S. Large Cap Funds | | | | | 25.0% | | | | | | 21.6% | | | | | | 4.2% | | |
U.S. Mid Cap Funds | | | | | 5.0% | | | | | | 7.9% | | | | | | 0.7% | | |
U.S. Small Cap Funds | | | | | 3.0% | | | | | | 3.0% | | | | | | 0.5% | | |
International Equity | | | | | 15.0% | | | | | | 14.8% | | | | | | 1.0% | | |
Fixed income | | | | | 45.0% | | | | | | 44.3% | | | | | | 0.5% | | |
Other investments | | | | | 7.0% | | | | | | 8.4% | | | | | | 0.1% | | |
| | | | | 100.0% | | | | | | 100.0% | | | | | | 7.0% | | |
(Amounts in thousands) | | | Fair value as of December 31, 2017 | | | Quoted Prices in Active Markets for Identical Assets (Level 1) | | | Significant Other Observable Inputs (Level 2) | | | Significant Unobservable Inputs (Level 3) | | ||||||||||||
Equity Securities(1) | | | | | | ||||||||||||||||||||
U.S. Large Cap Funds | | | | $ | 7,660 | | | | | $ | 7,660 | | | | | $ | — | | | | | $ | — | | |
U.S. Mid Cap Funds | | | | | 2,797 | | | | | | 1,381 | | | | | | 1,416 | | | | | | — | | |
U.S. Small Cap Funds | | | | | 1,038 | | | | | | 515 | | | | | | 523 | | | | | | — | | |
International Funds | | | | | 5,203 | | | | | | 5,203 | | | | | | — | | | | | | — | | |
Fixed Income | | | | | | ||||||||||||||||||||
Domestic Bond Funds(2) | | | | | 15,261 | | | | | | — | | | | | | 15,261 | | | | | | — | | |
Other Investments | | | | | | ||||||||||||||||||||
Commodity Funds(3) | | | | | 1,765 | | | | | | — | | | | | | 1,765 | | | | | | — | | |
Cash & Cash Equivalents | | | | | 630 | | | | | | 630 | | | | | | — | | | | | | — | | |
| | | | $ | 34,354 | | | | | $ | 15,389 | | | | | $ | 18,965 | | | | | $ | — | | |
|
(Amounts in thousands) | | | Fair value as of December 31, 2016 | | | Quoted Prices in Active Markets for Identical Assets (Level 1) | | | Significant Other Observable Inputs (Level 2) | | | Significant Unobservable Inputs (Level 3) | | ||||||||||||
Equity Securities(1) | | | | | | ||||||||||||||||||||
U.S. Large Cap Funds | | | | $ | 6,784 | | | | | $ | 6,784 | | | | | $ | — | | | | | $ | — | | |
U.S. Mid Cap Funds | | | | | 2,477 | | | | | | 1,226 | | | | | | 1,251 | | | | | | — | | |
U.S. Small Cap Funds | | | | | 931 | | | | | | 470 | | | | | | 461 | | | | | | — | | |
International Funds | | | | | 4,662 | | | | | | 4,662 | | | | | | — | | | | | | — | | |
Fixed Income | | | | | | ||||||||||||||||||||
Domestic Bond Funds(2) | | | | | 13,954 | | | | | | — | | | | | | 13,954 | | | | | | — | | |
Other Investments | | | | | | ||||||||||||||||||||
Commodity Funds(3) | | | | | 1,584 | | | | | | — | | | | | | 1,584 | | | | | | — | | |
Cash & Cash Equivalents | | | | | 1,086 | | | | | | 1,086 | | | | | | — | | | | | | — | | |
| | | | $ | 31,478 | | | | | $ | 14,228 | | | | | $ | 17,250 | | | | | $ | — | | |
|
Fiscal Year | | | Expected Benefit Payments | | |||
(Amounts in thousands) | | | |||||
2018 | | | | $ | 2,404 | | |
2019 | | | | | 2,469 | | |
2020 | | | | | 2,568 | | |
2021 | | | | | 2,624 | | |
2022 | | | | | 2,681 | | |
2023-2027 | | | | | 14,119 | | |
(Amounts in thousands) | | | Lease Commitments | | | Sublease Income | | ||||||
2018 | | | | $ | 31,590 | | | | | $ | 437 | | |
2019 | | | | | 27,455 | | | | | | 445 | | |
2020 | | | | | 22,123 | | | | | | 454 | | |
2021 | | | | | 17,755 | | | | | | 463 | | |
2022 | | | | | 15,694 | | | | | | 473 | | |
Thereafter | | | | | 25,431 | | | | | | 974 | | |
(Amounts in thousands) | | | December 31, 2017 | | | December 31, 2016 | | ||||||
Product claim liabilities | | | | $ | 138 | | | | | $ | 138 | | |
Multiemployer pension plan withdrawal liability | | | | | 449 | | | | | | 808 | | |
Other | | | | | 439 | | | | | | 500 | | |
| | | | $ | 1,026 | | | | | $ | 1,446 | | |
|
(Amounts in thousands) | | | For the year ended December 31, | | |||||||||||||||
| 2017 | | | 2016 | | | 2015 | | |||||||||||
Balance, beginning of period | | | | $ | 77,279 | | | | | $ | 76,562 | | | | | $ | 84,423 | | |
Acquisitions – Canyon Stone (2015) | | | | | — | | | | | | — | | | | | | 100 | | |
Warranty expense during period | | | | | 22,309 | | | | | | 22,266 | | | | | | 21,264 | | |
Adjustments | | | | | — | | | | | | — | | | | | | (7,761) | | |
Settlements made during period | | | | | (22,271) | | | | | | (21,549) | | | | | | (21,464) | | |
Balance, end of period | | | | $ | 77,317 | | | | | $ | 77,279 | | | | | $ | 76,562 | | |
|
(Amounts in thousands) | | | December 31, 2017 | | | December 31, 2016 | | ||||||
Insurance | | | | $ | 7,637 | | | | | $ | 8,297 | | |
Employee compensation and benefits | | | | | 19,720 | | | | | | 27,749 | | |
Sales and marketing | | | | | 58,131 | | | | | | 59,655 | | |
Product warranty | | | | | 19,652 | | | | | | 19,718 | | |
Accrued freight | | | | | 3,696 | | | | | | 2,146 | | |
Accrued interest | | | | | 18,027 | | | | | | 17,977 | | |
Accrued environmental liability | | | | | 453 | | | | | | 434 | | |
Accrued pension | | | | | 1,358 | | | | | | 1,753 | | |
Accrued sales returns and discounts | | | | | 1,303 | | | | | | 1,199 | | |
Accrued taxes | | | | | 4,735 | | | | | | 4,966 | | |
Litigation accrual | | | | | 26,849 | | | | | | 2,575 | | |
Other | | | | | 24,296 | | | | | | 22,546 | | |
| | | | $ | 185,857 | | | | | $ | 169,015 | | |
|
(Amounts in thousands) | | | December 31, 2017 | | | December 31, 2016 | | ||||||
Insurance | | | | $ | 595 | | | | | $ | 605 | | |
Pension liabilities | | | | | 12,805 | | | | | | 13,907 | | |
Multi-employer pension withdrawal liability | | | | | 449 | | | | | | 808 | | |
Product warranty | | | | | 57,665 | | | | | | 57,575 | | |
Long-term product claim liability | | | | | 138 | | | | | | 138 | | |
Long-term environmental liability | | | | | 1,075 | | | | | | 1,158 | | |
Liabilities for tax uncertainties | | | | | 4,529 | | | | | | 3,925 | | |
Litigation accrual | | | | | 731 | | | | | | 731 | | |
Other | | | | | 5,437 | | | | | | 7,548 | | |
| | | | $ | 83,424 | | | | | $ | 86,395 | | |
|
(Amounts in thousands) | | | For the year ended December 31, | | |||||||||||||||
| 2017 | | | 2016 | | | 2015 | | |||||||||||
Domestic | | | | $ | 117,750 | | | | | $ | 35,258 | | | | | $ | 47,901 | | |
Foreign | | | | | (2,769) | | | | | | (11,766) | | | | | | (16,301) | | |
| | | | $ | 114,981 | | | | | $ | 23,492 | | | | | $ | 31,600 | | |
|
(Amounts in thousands) | | | For the year ended December 31, | | |||||||||||||||
| 2017 | | | 2016 | | | 2015 | | |||||||||||
Federal: | | | | | |||||||||||||||
Current | | | | $ | 989 | | | | | $ | 1,043 | | | | | $ | 692 | | |
Deferred | | | | | 39,692 | | | | | | (54,692) | | | | | | (2,833) | | |
| | | | | 40,681 | | | | | | (53,649) | | | | | | (2,141) | | |
State: | | | | | |||||||||||||||
Current | | | | $ | 5,204 | | | | | $ | 4,674 | | | | | $ | 2,688 | | |
Deferred | | | | | 1,259 | | | | | | (2,020) | | | | | | (779) | | |
| | | | | 6,463 | | | | | | 2,654 | | | | | | 1,909 | | |
Foreign: | | | | | |||||||||||||||
Current | | | | $ | 838 | | | | | $ | 277 | | | | | $ | 833 | | |
Deferred | | | | | (1,328) | | | | | | (1,277) | | | | | | (1,289) | | |
| | | | | (490) | | | | | | (1,000) | | | | | | (456) | | |
Total | | | | $ | 46,654 | | | | | $ | (51,995) | | | | | $ | (688) | | |
|
(Amounts in thousands) | | | For the year ended December 31, | | |||||||||||||||
| 2017 | | | 2016 | | | 2015 | | |||||||||||
Income tax provision at the federal statutory rate | | | | $ | 40,243 | | | | | $ | 8,222 | | | | | $ | 11,060 | | |
Net change from statutory rate: | | | | | |||||||||||||||
Valuation allowance – US | | | | | 165 | | | | | | (88,653) | | | | | | (30,446) | | |
Valuation allowance – Canada | | | | | 207 | | | | | | 1,714 | | | | | | 3,551 | | |
State income tax provision, net of federal income tax benefit | | | | | 4,462 | | | | | | 5,937 | | | | | | 4,986 | | |
Taxes at non-U.S. statutory rate | | | | | (283) | | | | | | 348 | | | | | | (153) | | |
Additional provisions/reversals of unrecognized tax benefits | | | | | (281) | | | | | | 187 | | | | | | (116) | | |
Canadian rate differential | | | | | 142 | | | | | | 808 | | | | | | 1,284 | | |
Attribute reduction | | | | | — | | | | | | (3,118) | | | | | | 3,118 | | |
Tax Receivable Agreement | | | | | 162 | | | | | | 21,306 | | | | | | 4,531 | | |
Alternative minimum tax | | | | | 1,463 | | | | | | 1,483 | | | | | | 1,298 | | |
Minimum tax credit | | | | | (1,463) | | | | | | (1,483) | | | | | | (1,298) | | |
Meals and entertainment | | | | | 676 | | | | | | 675 | | | | | | 595 | | |
Executive compensation | | | | | 748 | | | | | | 599 | | | | | | — | | |
Work opportunity tax credit | | | | | (474) | | | | | | (438) | | | | | | — | | |
Tax Reform – Deferred Taxes | | | | | 4,272 | | | | | | — | | | | | | — | | |
Tax Reform – Tax Receivable Agreement | | | | | (3,746) | | | | | | — | | | | | | — | | |
Other, net | | | | | 361 | | | | | | 418 | | | | | | 902 | | |
| | | | $ | 46,654 | | | | | $ | (51,995) | | | | | $ | (688) | | |
|
(Amounts in thousands) | | | 2017 | | | 2016 | | ||||||
Deferred tax assets: | | | | ||||||||||
Accounts receivable | | | | $ | 615 | | | | | $ | 824 | | |
Insurance reserves | | | | | 2,004 | | | | | | 3,302 | | |
Warranty reserves | | | | | 18,616 | | | | | | 26,826 | | |
Pension accrual | | | | | 3,837 | | | | | | 6,292 | | |
Deferred compensation | | | | | 4,683 | | | | | | 10,946 | | |
Inventories | | | | | 2,936 | | | | | | 4,898 | | |
Federal, net operating loss carry-forwards | | | | | 12,621 | | | | | | 48,732 | | |
State, net operating loss carry-forwards | | | | | 12,580 | | | | | | 10,496 | | |
Non-capital losses - foreign jurisdiction | | | | | 13,116 | | | | | | 11,743 | | |
Related party interest | | | | | 3,347 | | | | | | 18,055 | | |
Professional fees | | | | | 1,087 | | | | | | 2,031 | | |
Environmental reserves | | | | | 374 | | | | | | 576 | | |
Alternative minimum tax | | | | | 4,244 | | | | | | 2,782 | | |
Other assets, net | | | | | 5,008 | | | | | | 7,530 | | |
Valuation allowance | | | | | (26,553) | | | | | | (22,889) | | |
Total deferred tax assets | | | | | 58,515 | | | | | | 132,144 | | |
Deferred tax liabilities: | | | | ||||||||||
Property and equipment, net | | | | | (18,851) | | | | | | (27,589) | | |
Intangible assets, net | | | | | (20,873) | | | | | | (36,894) | | |
Deferred financing | | | | | (8,991) | | | | | | (18,063) | | |
Other liabilities, net | | | | | (807) | | | | | | (1,973) | | |
Total deferred tax liabilities | | | | | (49,522) | | | | | | (84,519) | | |
Net deferred tax asset | | | | $ | 8,993 | | | | | $ | 47,625 | | |
|
(Amounts in thousands) | | | |||||
Unrecognized tax benefits balance at January 1, 2016 | | | | $ | 15,910 | | |
Additions based on tax positions related to current year | | | | | 208 | | |
Additions for tax positions of prior years | | | | | 603 | | |
Reductions for tax positions of prior years | | | | | (13) | | |
Settlement or lapse of applicable statutes | | | | | (39) | | |
Unrecognized tax benefits balance at December 31, 2016 | | | | | 16,669 | | |
Additions based on tax positions related to current year | | | | | 182 | | |
Additions for tax positions of prior years | | | | | 161 | | |
Reductions for tax positions of prior years | | | | | (90) | | |
Settlement or lapse of applicable statutes | | | | | (400) | | |
Unrecognized tax benefits balance at December 31, 2017 | | | | $ | 16,522 | | |
|
| | | December 31, 2015 | | |||
Weighted average fair value of options granted | | | | $ | 2.62 | | |
Weighted average assumptions used: | | | |||||
Expected volatility | | | | | 34% | | |
Expected term (in years) | | | | | 7.00 | | |
Risk-free interest rate | | | | | 1.82% | | |
Expected dividend yield | | | | | —% | | |
| | | Stock Options | | | Weighted- Average Exercise Price | | | Weighted- Average Remaining Contractual Term (Years) | | | Aggregate Intrinsic Value | | ||||||||||||
| | | | | | | | | | | | | | | | | | | | | (in thousands) | | |||
Balance at January 1, 2016 | | | | | 2,613,793 | | | | | $ | 13.75 | | | | | | 5.22 | | | | | | 617 | | |
Granted | | | | | — | | | | | $ | — | | | | | | — | | | | |||||
Exercised | | | | | (116,594) | | | | | $ | 9.35 | | | | | | — | | | | |||||
Forfeited or expired | | | | | (1,666) | | | | | $ | 12.35 | | | | | | — | | | | |||||
Balance at December 31, 2016 | | | | | 2,495,533 | | | | | $ | 13.96 | | | | | | 4.35 | | | | | | 5,729 | | |
Granted | | | | | — | | | | | $ | — | | | | | | — | | | | |||||
Exercised | | | | | (97,352) | | | | | $ | 12.35 | | | | | | — | | | | |||||
Forfeited or expired | | | | | — | | | | | $ | — | | | | | | — | | | | |||||
Balance at December 31, 2017 | | | | | 2,398,181 | | | | | $ | 14.02 | | | | | | 3.43 | | | | | | 10,671 | | |
|
(Amounts in thousands) | | | For the year ended December 31, | | |||||||||||||||
| 2017 | | | 2016 | | | 2015 | | |||||||||||
Net sales | | | | | |||||||||||||||
Siding, Fencing, and Stone | | | | $ | 970,198 | | | | | $ | 886,851 | | | | | $ | 840,118 | | |
Windows and Doors | | | | | 1,086,105 | | | | | | 1,024,993 | | | | | | 999,608 | | |
| | | | $ | 2,056,303 | | | | | $ | 1,911,844 | | | | | $ | 1,839,726 | | |
Operating earnings (loss) | | | | | |||||||||||||||
Siding, Fencing, and Stone | | | | $ | 146,753 | | | | | $ | 157,058 | | | | | $ | 134,654 | | |
Windows and Doors | | | | | 56,435 | | | | | | 43,579 | | | | | | 18,195 | | |
Unallocated | | | | | (28,930) | | | | | | (32,141) | | | | | | (30,317) | | |
| | | | $ | 174,258 | | | | | $ | 168,496 | | | | | $ | 122,532 | | |
Interest (income) expense, net | | | | | |||||||||||||||
Siding, Fencing, and Stone | | | | $ | (29) | | | | | $ | (16) | | | | | $ | (22) | | |
Windows and Doors | | | | | (21) | | | | | | (12) | | | | | | (17) | | |
Unallocated | | | | | 69,333 | | | | | | 72,710 | | | | | | 74,858 | | |
| | | | $ | 69,283 | | | | | $ | 72,682 | | | | | $ | 74,819 | | |
Depreciation and amortization | | | | | |||||||||||||||
Siding, Fencing, and Stone | | | | $ | 22,562 | | | | | $ | 25,723 | | | | | $ | 26,539 | | |
Windows and Doors | | | | | 30,369 | | | | | | 30,516 | | | | | | 31,549 | | |
Unallocated | | | | | 316 | | | | | | 164 | | | | | | 312 | | |
| | | | $ | 53,247 | | | | | $ | 56,403 | | | | | $ | 58,400 | | |
|
(Amounts in thousands) | | | For the year ended December 31, | | |||||||||||||||
| 2017 | | | 2016 | | | 2015 | | |||||||||||
Income tax provision (benefit) | | | | | |||||||||||||||
Unallocated | | | | $ | 46,654 | | | | | $ | (51,995) | | | | | $ | (688) | | |
Capital expenditures | | | | | |||||||||||||||
Siding, Fencing, and Stone | | | | $ | 17,243 | | | | | $ | 16,472 | | | | | $ | 11,816 | | |
Windows and Doors | | | | | 20,613 | | | | | | 17,780 | | | | | | 19,196 | | |
Unallocated | | | | | 2,530 | | | | | | 1,749 | | | | | | 2,848 | | |
| | | | $ | 40,386 | | | | | $ | 36,001 | | | | | $ | 33,860 | | |
|
| | | As of December 31, | | | | | |||||||||
| | | 2017 | | | 2016 | | | | | ||||||
Total assets | | | | | ||||||||||||
Siding, Fencing, and Stone | | | | $ | 728,502 | | | | | $ | 691,930 | | | | | |
Windows and Doors | | | | | 500,278 | | | | | | 509,055 | | | | | |
Unallocated | | | | | 90,787 | | | | | | 56,756 | | | | | |
| | | | $ | 1,319,567 | | | | | $ | 1,257,741 | | | | | |
|
(Amounts in thousands, except per share data) | | | Quarter Ended December 31, 2017 | | | Quarter Ended September 30, 2017 | | | Quarter Ended July 1, 2017 | | | Quarter Ended April 1, 2017 | | ||||||||||||
Net sales | | | | $ | 516,858 | | | | | $ | 564,663 | | | | | $ | 544,767 | | | | | $ | 430,015 | | |
Gross profit | | | | | 110,134 | | | | | | 131,966 | | | | | | 136,888 | | | | | | 89,525 | | |
Net income (loss) | | | | | 14,571(2)(3) | | | | | | 27,534 | | | | | | 29,859 | | | | | | (3,637) | | |
Net income (loss) per share attributable to common shareholders: | | | | | | | | | | | | | | | | | | | | | | | | | |
Basic(1) | | | | $ | 0.21 | | | | | $ | 0.40 | | | | | $ | 0.44 | | | | | $ | (0.05) | | |
Diluted(1) | | | | $ | 0.21 | | | | | $ | 0.40 | | | | | $ | 0.43 | | | | | $ | (0.05) | | |
(Amounts in thousands, except per share data) | | | Quarter Ended December 31, 2016 | | | Quarter Ended October 1, 2016 | | | Quarter Ended July 2, 2016 | | | Quarter Ended April 2, 2016 | | ||||||||||||
Net sales | | | | $ | 462,293 | | | | | $ | 530,392 | | | | | $ | 510,545 | | | | | $ | 408,614 | | |
Gross profit | | | | | 103,484 | | | | | | 136,800 | | | | | | 135,289 | | | | | | 86,701 | | |
Net income (loss) | | | | | 6,663(4)(5) | | | | | | 54,755(4) | | | | | | 41,646 | | | | | | (27,577p)(4) | | |
Net income (loss) per share attributable to common shareholders: | | | | | | ||||||||||||||||||||
Basic(1) | | | | $ | 0.10 | | | | | $ | 0.80 | | | | | $ | 0.61 | | | | | $ | (0.40) | | |
Diluted(1) | | | | $ | 0.10 | | | | | $ | 0.80 | | | | | $ | 0.61 | | | | | $ | (0.40) | | |
(Amounts in thousands) | | | Guarantor Ply Gem Holdings, Inc. | | | Issuer Ply Gem Industries, Inc. | | | Guarantor Subsidiaries | | | Non- Guarantor Subsidiary | | | Consolidating Adjustments | | | Consolidated | | ||||||||||||||||||
Net sales | | | | $ | — | | | | | $ | — | | | | | $ | 1,832,925 | | | | | $ | 223,378 | | | | | $ | — | | | | | $ | 2,056,303 | | |
Cost of products sold | | | | | — | | | | | | — | | | | | | 1,419,980 | | | | | | 167,810 | | | | | | — | | | | | | 1,587,790 | | |
Gross profit | | | | | — | | | | | | — | | | | | | 412,945 | | | | | | 55,568 | | | | | | — | | | | | | 468,513 | | |
Operating expenses: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Selling, general and administrative expenses | | | | | — | | | | | | 28,930 | | | | | | 196,622 | | | | | | 47,432 | | | | | | — | | | | | | 272,984 | | |
Intercompany administrative charges | | | | | — | | | | | | — | | | | | | 37,437 | | | | | | 3,999 | | | | | | (41,436) | | | | | | | | |
Amortization of intangible assets | | | | | — | | | | | | — | | | | | | 16,872 | | | | | | 4,399 | | | | | | — | | | | | | 21,271 | | |
Total operating expenses | | | | | — | | | | | | 28,930 | | | | | | 250,931 | | | | | | 55,830 | | | | | | (41,436) | | | | | | 294,255 | | |
Operating earnings (loss) | | | | | — | | | | | | (28,930) | | | | | | 162,014 | | | | | | (262) | | | | | | 41,436 | | | | | | 174,258 | | |
Foreign currency gain | | | | | — | | | | | | — | | | | | | — | | | | | | 1,363 | | | | | | — | | | | | | 1,363 | | |
Intercompany interest | | | | | — | | | | | | 56,888 | | | | | | (52,995) | | | | | | (3,893) | | | | | | — | | | | | | — | | |
Interest expense | | | | | — | | | | | | (69,361) | | | | | | — | | | | | | — | | | | | | — | | | | | | (69,361) | | |
Interest income | | | | | — | | | | | | 28 | | | | | | 27 | | | | | | 23 | | | | | | — | | | | | | 78 | | |
Tax receivable agreement liability adjustment | | | | | — | | | | | | 10,749 | | | | | | — | | | | | | — | | | | | | — | | | | | | 10,749 | | |
Loss on modification or extinguishment of debt | | | | | — | | | | | | (2,106) | | | | | | — | | | | | | — | | | | | | — | | | | | | (2,106) | | |
Intercompany administrative income | | | | | — | | | | | | 41,436 | | | | | | — | | | | | | — | | | | | | (41,436) | | | | | | — | | |
Income (loss) before equity in subsidiaries’ income | | | | | — | | | | | | 8,704 | | | | | | 109,046 | | | | | | (2,769) | | | | | | — | | | | | | 114,981 | | |
Equity in subsidiaries’ income | | | | | 68,327 | | | | | | 59,623 | | | | | | — | | | | | | — | | | | | | (127,950) | | | | | | | | |
Income (loss) before provision (benefit) for income taxes | | | | | 68,327 | | | | | | 68,327 | | | | | | 109,046 | | | | | | (2,769) | | | | | | (127,950) | | | | | | 114,981 | | |
Provision (benefit) for income taxes | | | | | — | | | | | | — | | | | | | 47,144 | | | | | | (490) | | | | | | | | | | | | 46,654 | | |
Net income (loss) | | | | $ | 68,327 | | | | | $ | 68,327 | | | | | $ | 61,902 | | | | | $ | (2,279) | | | | | $ | (127,950) | | | | | $ | 68,327 | | |
Other comprehensive income (loss): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Foreign currency translation adjustments | | | | | — | | | | | | — | | | | | | — | | | | | | 3,765 | | | | | | — | | | | | | 3,765 | | |
Unrealized loss on derivative instruments | | | | | — | | | | | | — | | | | | | — | | | | | | (853) | | | | | | — | | | | | | (853) | | |
Minimum pension liability for actuarial gain | | | | | — | | | | | | — | | | | | | 610 | | | | | | — | | | | | | — | | | | | | 610 | | |
Total comprehensive income (loss) | | | | $ | 68,327 | | | | | $ | 68,327 | | | | | $ | 62,512 | | | | | $ | 633 | | | | | $ | (127,950) | | | | | $ | 71,849 | | |
|
(Amounts in thousands) | | Guarantor Ply Gem Holdings, Inc. | | Issuer Ply Gem Industries, Inc. | | Guarantor Subsidiaries | | Non- Guarantor Subsidiary | | Consolidating Adjustments | | Consolidated | | | Guarantor Ply Gem Holdings, Inc. | | Issuer Ply Gem Industries, Inc. | | Guarantor Subsidiaries | | Non- Guarantor Subsidiary | | Consolidating Adjustments | | Consolidated | | ||||||||||||||||||||||||||||||||||||||||||||||||
Net sales | | | $ | — | | | | $ | — | | | | $ | 1,713,112 | | | | $ | 198,732 | | | | $ | — | | | | $ | 1,911,844 | | | | | $ | — | | | | $ | — | | | | $ | 1,713,112 | | | | $ | 198,732 | | | | $ | — | | | | $ | 1,911,844 | | | ||||||||||||
Cost of products sold | | | | — | | | | | — | | | | | 1,298,281 | | | | | 151,289 | | | | | — | | | ��� | | 1,449,570 | | | | | | — | | | | | — | | | | | 1,298,281 | | | | | 151,289 | | | | | — | | | | | 1,449,570 | | | ||||||||||||
Gross profit | | | | — | | | | | — | | | | | 414,831 | | | | | 47,443 | | | | | — | | | | | 462,274 | | | | | | — | | | | | — | | | | | 414,831 | | | | | 47,443 | | | | | — | | | | | 462,274 | | | ||||||||||||
Operating expenses: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||||||
Selling, general and administrative expenses | | | | — | | | | | 32,141 | | | | | 190,444 | | | | | 46,129 | | | | | — | | | | | 268,714 | | | | | | — | | | | | 32,141 | | | | | 190,444 | | | | | 46,129 | | | | | — | | | | | 268,714 | | | ||||||||||||
Intercompany administrative charges | | | | — | | | | | — | | | | | 32,487 | | | | | 5,180 | | | | | (37,667) | | | | | — | | | | | | — | | | | | — | | | | | 32,487 | | | | | 5,180 | | | | | (37,667) | | | | | — | | | ||||||||||||
Amortization of intangible assets | | | | — | | | | | — | | | | | 20,707 | | | | | 4,357 | | | | | — | | | | | 25,064 | | | | | | — | | | | | — | | | | | 20,707 | | | | | 4,357 | | | | | — | | | | | 25,064 | | | ||||||||||||
Total operating expenses | | | | — | | | | | 32,141 | | | | | 243,638 | | | | | 55,666 | | | | | (37,667) | | | | | 293,778 | | | | | | — | | | | | 32,141 | | | | | 243,638 | | | | | 55,666 | | | | | (37,667) | | | | | 293,778 | | | ||||||||||||
Operating earnings (loss) | | | | — | | | | | (32,141) | | | | | 171,193 | | | | | (8,223) | | | | | 37,667 | | | | | 168,496 | | | | | | — | | | | | (32,141) | | | | | 171,193 | | | | | (8,223) | | | | | 37,667 | | | | | 168,496 | | | ||||||||||||
Foreign currency gain | | | | — | | | | | — | | | | | — | | | | | 299 | | | | | — | | | | | 299 | | | | | | — | | | | | — | | | | | — | | | | | 299 | | | | | — | | | | | 299 | | | ||||||||||||
Intercompany interest | | | | — | | | | | 63,716 | | | | | (59,859) | | | | | (3,857) | | | | | — | | | | | — | | | | | | — | | | | | 63,716 | | | | | (59,859) | | | | | (3,857) | | | | | — | | | | | — | | | ||||||||||||
Interest expense | | | | — | | | | | (72,716) | | | | | — | | | | | (2) | | | | | — | | | | | (72,718) | | | | | | — | | | | | (72,716) | | | | | — | | | | | (2) | | | | | — | | | | | (72,718) | | | ||||||||||||
Interest income | | | | — | | | | | 6 | | | | | 13 | | | | | 17 | | | | | — | | | | | 36 | | | | | | — | | | | | 6 | | | | | 13 | | | | | 17 | | | | | — | | | | | 36 | | | ||||||||||||
Tax receivable agreement liability adjustment | | | | — | | | | | (60,874) | | | | | — | | | | | — | | | | | — | | | | | (60,874) | | | | | | — | | | | | (60,874) | | | | | — | | | | | — | | | | | — | | | | | (60,874) | | | ||||||||||||
Loss on modification or extinguishment of debt | | | | — | | | | | (11,747) | | | | | — | | | | | — | | | | | — | | | | | (11,747) | | | | | | — | | | | | (11,747) | | | | | — | | | | | — | | | | | — | | | | | (11,747) | | | ||||||||||||
Intercompany administrative income | | | | — | | | | | 37,667 | | | | | — | | | | | — | | | | | (37,667) | | | | | — | | | | | | — | | | | | 37,667 | | | | | — | | | | | — | | | | | (37,667) | | | | | — | | | ||||||||||||
Income (loss) before equity in subsidiaries’ income | | | | — | | | | | (76,089) | | | | | 111,347 | | | | | (11,766) | | | | | — | | | | | 23,492 | | | | | | — | | | | | (76,089) | | | | | 111,347 | | | | | (11,766) | | | | | — | | | | | 23,492 | | | ||||||||||||
Equity in subsidiaries’ income | | | | 75,487 | | | | | 151,576 | | | | | — | | | | | — | | | | | (227,063) | | | | | — | | | | | | 75,487 | | | | | 151,576 | | | | | — | | | | | — | | | | | (227,063) | | | | | — | | | ||||||||||||
Income (loss) before provision (benefit) for income taxes | | | | 75,487 | | | | | 75,487 | | | | | 111,347 | | | | | (11,766) | | | | | (227,063) | | | | | 23,492 | | | | | | 75,487 | | | | | 75,487 | | | | | 111,347 | | | | | (11,766) | | | | | (227,063) | | | | | 23,492 | | | ||||||||||||
Provision (benefit) for income taxes | | | | — | | | | | — | | | | | (50,995) | | | | | (1,000) | | | | | | | | | | (51,995) | | | | | | — | | | | | — | | | | | (50,995) | | | | | (1,000) | | | | | | | | | | (51,995) | | | ||||||||||||
Net income (loss) | | | $ | 75,487 | | | | $ | 75,487 | | | | $ | 162,342 | | | | $ | (10,766) | | | | $ | (227,063) | | | | $ | 75,487 | | | | | $ | 75,487 | | | | $ | 75,487 | | | | $ | 162,342 | | | | $ | (10,766) | | | | $ | (227,063) | | | | $ | 75,487 | | | ||||||||||||
Other comprehensive income (loss): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||||||
Foreign currency translation adjustments | | | | — | | | | | — | | | | | — | | | | | 2,950 | | | | | — | | | | | 2,950 | | | | | | — | | | | | — | | | | | — | | | | | 2,950 | | | | | — | | | | | 2,950 | | | ||||||||||||
Unrealized loss on derivative instruments | | | | — | | | | | — | | | | | — | | | | | 29 | | | | | — | | | | | 29 | | | | | | — | | | | | — | | | | | — | | | | | 29 | | | | | — | | | | | 29 | | | ||||||||||||
Minimum pension liability for actuarial gain | | | | — | | | | | — | | | | | 295 | | | | | — | | | | | — | | | | | 295 | | | | | | — | | | | | — | | | | | 295 | | | | | — | | | | | — | | | | | 295 | | | ||||||||||||
Total comprehensive income (loss) | | | $ | 75,487 | | | | $ | 75,487 | | | | $ | 162,637 | | | | $ | (7,787) | | | | $ | (227,063) | | | | $ | 78,761 | | | | | $ | 75,487 | | | | $ | 75,487 | | | | $ | 162,637 | | | | $ | (7,787) | | | | $ | (227,063) | | | | $ | 78,761 | | | |
(Amounts in thousands) | | | Guarantor Ply Gem Holdings, Inc. | | | Issuer Ply Gem Industries, Inc. | | | Guarantor Subsidiaries | | | Non- Guarantor Subsidiary | | | Consolidating Adjustments | | | Consolidated | | ||||||||||||||||||
Net sales | | | | $ | — | | | | | $ | — | | | | | $ | 1,616,407 | | | | | $ | 223,319 | | | | | $ | — | | | | | $ | 1,839,726 | | |
Cost of products sold | | | | | — | | | | | | — | | | | | | 1,249,887 | | | | | | 170,127 | | | | | | — | | | | | | 1,420,014 | | |
Gross profit | | | | | — | | | | | | — | | | | | | 366,520 | | | | | | 53,192 | | | | | | — | | | | | | 419,712 | | |
Operating expenses: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Selling, general and administrative expenses | | | | | — | | | | | | 30,317 | | | | | | 189,477 | | | | | | 52,080 | | | | | | — | | | | | | 271,874 | | |
Intercompany administrative charges | | | | | — | | | | | | — | | | | | | 28,704 | | | | | | 5,943 | | | | | | (34,647) | | | | | | — | | |
Amortization of intangible assets | | | | | — | | | | | | — | | | | | | 20,737 | | | | | | 4,569 | | | | | | — | | | | | | 25,306 | | |
Total operating expenses | | | | | — | | | | | | 30,317 | | | | | | 238,918 | | | | | | 62,592 | | | | | | (34,647) | | | | | | 297,180 | | |
Operating earnings (loss) | | | | | — | | | | | | (30,317) | | | | | | 127,602 | | | | | | (9,400) | | | | | | 34,647 | | | | | | 122,532 | | |
Foreign currency loss | | | | | — | | | | | | — | | | | | | — | | | | | | (3,166) | | | | | | — | | | | | | (3,166) | | |
Intercompany interest | | | | | — | | | | | | 63,391 | | | | | | (59,641) | | | | | | (3,750) | | | | | | — | | | | | | — | | |
Interest expense | | | | | — | | | | | | (74,863) | | | | | | (4) | | | | | | (9) | | | | | | — | | | | | | (74,876) | | |
Interest income | | | | | — | | | | | | 5 | | | | | | 28 | | | | | | 24 | | | | | | — | | | | | | 57 | | |
Tax receivable agreement liability adjustment | | | | | — | | | | | | (12,947) | | | | | | — | | | | | | — | | | | | | — | | | | | | (12,947) | | |
Intercompany administrative income | | | | | — | | | | | | 34,647 | | | | | | — | | | | | | — | | | | | | (34,647) | | | | | | — | | |
Income (loss) before equity in subsidiaries’ income | | | | | — | | | | | | (20,084) | | | | | | 67,985 | | | | | | (16,301) | | | | | | — | | | | | | 31,600 | | |
Equity in subsidiaries’ income (loss) | | | | | 32,288 | | | | | | 52,372 | | | | | | — | | | | | | — | | | | | | (84,660) | | | | | | — | | |
Income (loss) before provision (benefit) for income taxes | | | | | 32,288 | | | | | | 32,288 | | | | | | 67,985 | | | | | | (16,301) | | | | | | (84,660) | | | | | | 31,600 | | |
Benefit for income taxes | | | | | — | | | | | | — | | | | | | (232) | | | | | | (456) | | | | | | — | | | | | | (688) | | |
Net income (loss) | | | | $ | 32,288 | | | | | $ | 32,288 | | | | | $ | 68,217 | | | | | $ | (15,845) | | | | | $ | (84,660) | | | | | $ | 32,288 | | |
Other comprehensive income (loss): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Foreign currency translation adjustments | | | | | — | | | | | | — | | | | | | — | | | | | | (14,690) | | | | | | — | | | | | | (14,690) | | |
Unrealized loss on derivative instruments | | | | | — | | | | | | — | | | | | | — | | | | | | (465) | | | | | | — | | | | | | (465) | | |
Minimum pension liability for actuarial gain | | | | | — | | | | | | — | | | | | | (1,436) | | | | | | — | | | | | | — | | | | | | (1,436) | | |
Total comprehensive income (loss) | | | | $ | 32,288 | | | | | $ | 32,288 | | | | | $ | 66,781 | | | | | $ | (31,000) | | | | | $ | (84,660) | | | | | $ | 15,697 | | |
|
(Amounts in thousands) | | | Guarantor Ply Gem Holdings, Inc. | | | Issuer Ply Gem Industries, Inc. | | | Guarantor Subsidiaries | | | Non- Guarantor Subsidiary | | | Consolidating Adjustments | | | Consolidated | | ||||||||||||||||||
ASSETS | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Current Assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Cash and cash equivalents | | | | $ | — | | | | | $ | 65,451 | | | | | $ | (12,905) | | | | | $ | 18,870 | | | | | $ | — | | | | | $ | 71,416 | | |
Accounts receivable, net | | | | | — | | | | | | — | | | | | | 222,847 | | | | | | 26,686 | | | | | | — | | | | | | 249,533 | | |
Inventories: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Raw materials | | | | | — | | | | | | — | | | | | | 72,688 | | | | | | 6,642 | | | | | | — | | | | | | 79,330 | | |
Work in process | | | | | — | | | | | | — | | | | | | 34,050 | | | | | | 2,390 | | | | | | — | | | | | | 36,440 | | |
Finished goods | | | | | — | | | | | | — | | | | | | 65,975 | | | | | | 14,746 | | | | | | — | | | | | | 80,721 | | |
Total inventory | | | | | — | | | | | | — | | | | | | 172,713 | | | | | | 23,778 | | | | | | — | | | | | | 196,491 | | |
Prepaid expenses and other current assets | | | | | — | | | | | | 19,741 | | | | | | 22,905 | | | | | | 3,254 | | | | | | — | | | | | | 45,900 | | |
Total current assets | | | | | — | | | | | | 85,192 | | | | | | 405,560 | | | | | | 72,588 | | | | | | — | | | | | | 563,340 | | |
Investments in subsidiaries | | | | | 81,921 | | | | | | (212,967) | | | | | | | | | | | | | | | | | | 131,046 | | | | | | — | | |
Property and Equipment, at cost: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Land | | | | | — | | | | | | — | | | | | | 7,553 | | | | | | 676 | | | | | | — | | | | | | 8,229 | | |
Buildings and improvements | | | | | — | | | | | | 518 | | | | | | 63,058 | | | | | | 4,429 | | | | | | — | | | | | | 68,005 | | |
Machinery and equipment | | | | | — | | | | | | 4,173 | | | | | | 422,255 | | | | | | 24,126 | | | | | | — | | | | | | 450,554 | | |
| | | | | — | | | | | | 4,691 | | | | | | 492,866 | | | | | | 29,231 | | | | | | — | | | | | | 526,788 | | |
Less accumulated depreciation | | | | | — | | | | | | (981) | | | | | | (337,546) | | | | | | (13,729) | | | | | | — | | | | | | (352,256) | | |
Total property and equipment, net | | | | | — | | | | | | 3,710 | | | | | | 155,320 | | | | | | 15,502 | | | | | | — | | | | | | 174,532 | | |
Other Assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Intangible assets, net | | | | | — | | | | | | — | | | | | | 74,943 | | | | | | 8,732 | | | | | | — | | | | | | 83,675 | | |
Goodwill | | | | | — | | | | | | — | | | | | | 449,366 | | | | | | 31,197 | | | | | | — | | | | | | 480,563 | | |
Deferred income taxes | | | | | — | | | | | | — | | | | | | 10,523 | | | | | | — | | | | | | — | | | | | | 10,523 | | |
Intercompany note receivable | | | | | — | | | | | | 1,139,073 | | | | | | | | | | | | — | | | | | | (1,139,073) | | | | | | | | |
Other | | | | | — | | | | | | 1,885 | | | | | | 5,049 | | | | | | — | | | | | | — | | | | | | 6,934 | | |
Total other assets | | | | | — | | | | | | 1,140,958 | | | | | | 539,881 | | | | | | 39,929 | | | | | | (1,139,073) | | | | | | 581,695 | | |
| | | | $ | 81,921 | | | | | $ | 1,016,893 | | | | | $ | 1,100,761 | | | | | $ | 128,019 | | | | | $ | (1,008,027) | | | | | $ | 1,319,567 | | |
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Current Liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Accounts payable | | | | $ | — | | | | | $ | 257 | | | | | $ | 69,439 | | | | | $ | 16,024 | | | | | $ | — | | | | | $ | 85,720 | | |
Accrued expenses | | | | | — | | | | | | 47,114 | | | | | | 120,335 | | | | | | 18,408 | | | | | | — | | | | | | 185,857 | | |
Current portion of payable to related parties pursuant to tax receivable agreement | | | | | — | | | | | | 51,356 | | | | | | — | | | | | | — | | | | | | — | | | | | | 51,356 | | |
Current portion of long-term debt | | | | | — | | | | | | 4,300 | | | | | | — | | | | | | — | | | | | | — | | | | | | 4,300 | | |
Total current liabilities | | | | | — | | | | | | 103,027 | | | | | | 189,774 | | | | | | 34,432 | | | | | | — | | | | | | 327,233 | | |
Deferred income taxes | | | | | — | | | | | | — | | | | | | — | | | | | | 1,530 | | | | | | — | | | | | | 1,530 | | |
Intercompany note payable | | | | | — | | | | | | — | | | | | | 1,022,988 | | | | | | 116,085 | | | | | | (1,139,073) | | | | | | — | | |
Long-term portion of payable to related parties pursuant to tax receivable agreement | | | | | — | | | | | | 18,125 | | | | | | — | | | | | | — | | | | | | — | | | | | | 18,125 | | |
Other long-term liabilities | | | | | — | | | | | | 6,486 | | | | | | 71,011 | | | | | | 5,927 | | | | | | — | | | | | | 83,424 | | |
Long-term debt | | | | | — | | | | | | 807,334 | | | | | | — | | | | | | | | | | | | | | | | | | 807,334 | | |
Commitments and contingencies | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Stockholders’ Equity (Deficit): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Preferred stock | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Common stock | | | | | 685 | | | | | | 685 | | | | | | — | | | | | | — | | | | | | (685) | | | | | | 685 | | |
Additional paid-in-capital | | | | | 756,096 | | | | | | 756,096 | | | | | | 192,777 | | | | | | 23,336 | | | | | | (972,209) | | | | | | 756,096 | | |
(Accumulated deficit) retained earnings | | | | | (645,090) | | | | | | (645,090) | | | | | | (360,720) | | | | | | (38,591) | | | | | | 1,044,401 | | | | | | (645,090) | | |
Accumulated other comprehensive loss | | | | | (29,770) | | | | | | (29,770) | | | | | | (15,069) | | | | | | (14,700) | | | | | | 59,539 | | | | | | (29,770) | | |
Total stockholder’s equity (deficit) | | | | | 81,921 | | | | | | 81,921 | | | | | | (183,012) | | | | | | (29,955) | | | | | | 131,046 | | | | | | 81,921 | | |
| | | | $ | 81,921 | | | | | $ | 1,016,893 | | | | | $ | 1,100,761 | | | | | $ | 128,019 | | | | | $ | (1,008,027) | | | | | $ | 1,319,567 | | |
|
(Amounts in thousands) | | | Guarantor Ply Gem Holdings, Inc. | | | Issuer Ply Gem Industries, Inc. | | | Guarantor Subsidiaries | | | Non- Guarantor Subsidiary | | | Consolidating Adjustments | | | Consolidated | | | ||||||||||||||||||||
ASSETS | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
Current Assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
Cash and cash equivalents | | | | $ | — | | | | | $ | 50,035 | | | | | $ | (10,918) | | | | | $ | 12,480 | | | | | $ | — | | | | | $ | 51,597 | | | | ||
Accounts receivable, net | | | | | — | | | | | | — | | | | | | 189,983 | | | | | | 19,936 | | | | | | — | | | | | | 209,919 | | | | ||
Inventories: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
Raw materials | | | | | — | | | | | | — | | | | | | 63,829 | | | | | | 5,810 | | | | | | — | | | | | | 69,639 | | | | ||
Work in process | | | | | — | | | | | | — | | | | | | 23,007 | | | | | | 1,614 | | | | | | — | | | | | | 24,621 | | | | ||
Finished goods | | | | | — | | | | | | — | | | | | | 54,346 | | | | | | 13,350 | | | | | | — | | | | | | 67,696 | | | | ||
Total inventory | | | | | — | | | | | | — | | | | | | 141,182 | | | | | | 20,774 | | | | | | — | | | | | | 161,956 | | | | ||
Prepaid expenses and other current assets | | | | | — | | | | | | 1,276 | | | | | | 21,940 | | | | | | 3,634 | | | | | | — | | | | | | 26,850 | | | | ||
Total current assets | | | | | — | | | | | | 51,311 | | | | | | 342,187 | | | | | | 56,824 | | | | | | — | | | | | | 450,322 | | | | ||
Investments in subsidiaries | | | | | 4,106 | | | | | | (231,236) | | | | | | — | | | | | | — | | | | | | 227,130 | | | | | | — | | | | ||
Property and Equipment, at cost: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
Land | | | | | — | | | | | | — | | | | | | 7,487 | | | | | | 762 | | | | | | — | | | | | | 8,249 | | | | ||
Buildings and improvements | | | | | — | | | | | | 510 | | | | | | 63,000 | | | | | | 4,441 | | | | | | — | | | | | | 67,951 | | | | ||
Machinery and equipment | | | | | — | | | | | | 1,675 | | | | | | 392,068 | | | | | | 19,822 | | | | | | — | | | | | | 413,565 | | | | ||
| | | | | — | | | | | | 2,185 | | | | | | 462,555 | | | | | | 25,025 | | | | | | — | | | | | | 489,765 | | | | ||
Less accumulated depreciation | | | | | — | | | | | | (665) | | | | | | (312,759) | | | | | | (10,785) | | | | | | — | | | | | | (324,209) | | | | ||
Total property and equipment, net | | | | | — | | | | | | 1,520 | | | | | | 149,796 | | | | | | 14,240 | | | | | | — | | | | | | 165,556 | | | | ||
Other Assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
Intangible assets, net | | | | | — | | | | | | — | | | | | | 91,748 | | | | | | 12,411 | | | | | | — | | | | | | 104,159 | | | | ||
Goodwill | | | | | — | | | | | | — | | | | | | 449,366 | | | | | | 29,148 | | | | | | — | | | | | | 478,514 | | | | ||
Deferred income taxes | | | | | — | | | | | | — | | | | | | 50,347 | | | | | | — | | | | | | — | | | | | | 50,347 | | | | ||
Intercompany note receivable | | | | | — | | | | | | 1,135,073 | | | | | | — | | | | | | — | | | | | | (1,135,073) | | | | | | — | | | | ||
Other | | | | | — | | | | | | 3,925 | | | | | | 4,918 | | | | | | — | | | | | | — | | | | | | 8,843 | | | | ||
Total other assets | | | | | — | | | | | | 1,138,998 | | | | | | 596,379 | | | | | | 41,559 | | | | | | (1,135,073) | | | | | | 641,863 | | | | ||
| | | | $ | 4,106 | | | | | $ | 960,593 | | | | | $ | 1,088,362 | | | | | $ | 112,623 | | | | | $ | (907,943) | | | | | $ | 1,257,741 | | | | ||
LIABILITIES AND STOCKHOLDERS’EQUITY (DEFICIT) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
Current Liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
Accounts payable | | | | | — | | | | | $ | 377 | | | | | $ | 64,206 | | | | | $ | 10,815 | | | | | $ | — | | | | | $ | 75,398 | | | | ||
Accrued expenses | | | | | — | | | | | | 29,812 | | | | | | 124,723 | | | | | | 14,480 | | | | | | — | | | | | | 169,015 | | | | ||
Current portion of payable to related parties pursuant to tax receivable agreement | | | | | — | | | | | | 25,383 | | | | | | — | | | | | | — | | | | | | — | | | | | | 25,383 | | | | ||
Current portion of long-term debt | | | | | — | | | | | | 4,300 | | | | | | — | | | | | | — | | | | | | — | | | | | | 4,300 | | | | ||
Total current liabilities | | | | | — | | | | | | 59,872 | | | | | | 188,929 | | | | | | 25,295 | | | | | | — | | | | | | 274,096 | | | | ||
Deferred income taxes | | | | | — | | | | | | — | | | | | | — | | | | | | 2,722 | | | | | | — | | | | | | 2,722 | | | | ||
Intercompany note payable | | | | | — | | | | | | — | | | | | | 1,026,657 | | | | | | 108,416 | | | | | | (1,135,073) | | | | | | — | | | | | |
Long-term portion of payable to related parties pursuant to tax receivable agreement | | | | | — | | | | | | 54,336 | | | | | | — | | | | | | — | | | | | | — | | | | | | 54,336 | | | | ||
Other long-term liabilities | | | | | — | | | | | | 6,193 | | | | | | 74,835 | | | | | | 5,367 | | | | | | — | | | | | | 86,395 | | | | ||
Long-term debt | | | | | — | | | | | | 836,086 | | | | | | — | | | | | | — | | | | | | — | | | | | | 836,086 | | | | ||
Commitments and contingencies | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
Stockholders’ Equity (Deficit): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
Preferred stock | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | ||
Common stock | | | | | 683 | | | | | | 683 | | | | | | — | | | | | | — | | | | | | (683) | | | | | | 683 | | | | ||
Additional paid-in-capital | | | | | 751,452 | | | | | | 751,452 | | | | | | 236,242 | | | | | | 26,464 | | | | | | (1,014,158) | | | | | | 751,452 | | | | ||
(Accumulated deficit) retained earnings | | | | | (714,737) | | | | | | (714,737) | | | | | | (422,622) | | | | | | (36,312) | | | | | | 1,173,671 | | | | | | (714,737) | | | | ||
Accumulated other comprehensive loss | | | | | (33,292) | | | | | | (33,292) | | | | | | (15,679) | | | | | | (19,329) | | | | | | 68,300 | | | | | | (33,292) | | | | ||
Total stockholder’s equity (deficit) | | | | | 4,106 | | | | | | 4,106 | | | | | | (202,059) | | | | | | (29,177) | | | | | | 227,130 | | | | | | 4,106 | | | | ||
| | | | $ | 4,106 | | | | | $ | 960,593 | | | | | $ | 1,088,362 | | | | | $ | 112,623 | | | | | $ | (907,943) | | | | | $ | 1,257,741 | | | | ||
|
(Amounts in thousands) | | | Guarantor Ply Gem Holdings, Inc. | | | Issuer Ply Gem Industries, Inc. | | | Guarantor Subsidiaries | | | Non- Guarantor Subsidiary | | | Consolidating Adjustments | | | Consolidated | | ||||||||||||||||||
Cash flows from operating activities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net income (loss) | | | | $ | 68,327 | | | | | $ | 68,327 | | | | | $ | 61,902 | | | | | $ | (2,279) | | | | | $ | (127,950) | | | | | $ | 68,327 | | |
Adjustments to reconcile net income (loss) to cash provided by (used in) operating activities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Depreciation and amortization expense | | | | | — | | | | | | 316 | | | | | | 45,892 | | | | | | 7,039 | | | | | | — | | | | | | 53,247 | | |
Non-cash restructuring costs | | | | | — | | | | | | — | | | | | | 1,321 | | | | | | — | | | | | | — | | | | | | 1,321 | | |
Non-cash interest expense, net | | | | | — | | | | | | 14,044 | | | | | | — | | | | | | — | | | | | | — | | | | | | 14,044 | | |
Gain on foreign currency transactions | | | | | — | | | | | | — | | | | | | — | | | | | | (1,363) | | | | | | — | | | | | | (1,363) | | |
Non-cash litigation expense | | | | | — | | | | | | 650 | | | | | | — | | | | | | — | | | | | | — | | | | | | 650 | | |
Loss on modification or extinguishment of debt | | | | | — | | | | | | 2,106 | | | | | | — | | | | | | — | | | | | | — | | | | | | 2,106 | | |
Stock based compensation | | | | | — | | | | | | 1,345 | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,345 | | |
Deferred income taxes | | | | | — | | | | | | — | | | | | | 40,951 | | | | | | (1,328) | | | | | | — | | | | | | 39,623 | | |
Tax receivable agreement liability adjustment | | | | | — | | | | | | (10,749) | | | | | | — | | | | | | — | | | | | | — | | | | | | (10,749) | | |
Increase in tax uncertainty, net of valuation allowance | | | | | — | | | | | | — | | | | | | 604 | | | | | | — | | | | | | — | | | | | | 604 | | |
Equity in subsidiaries’ net income | | | | | (68,327) | | | | | | (59,623) | | | | | | — | | | | | | — | | | | | | 127,950 | | | | | | — | | |
Gain on sale of building | | | | | — | | | | | | — | | | | | | — | | | | | | (1,880) | | | | | | — | | | | | | (1,880) | | |
Other | | | | | — | | | | | | — | | | | | | (175) | | | | | | — | | | | | | — | | | | | | (175) | | |
Changes in operating assets and liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Accounts receivable, net | | | | | — | | | | | | — | | | | | | (34,212) | | | | | | (5,219) | | | | | | — | | | | | | (39,431) | | |
Inventories | | | | | — | | | | | | — | | | | | | (32,989) | | | | | | (1,494) | | | | | | — | | | | | | (34,483) | | |
Prepaid expenses and other current assets | | | | | — | | | | | | (334) | | | | | | (1,497) | | | | | | (235) | | | | | | — | | | | | | (2,066) | | |
Accounts payable | | | | | — | | | | | | (120) | | | | | | 14,890 | | | | | | (4,297) | | | | | | — | | | | | | 10,473 | | |
Accrued expenses | | | | | — | | | | | | (4,762) | | | | | | (985) | | | | | | (2,703) | | | | | | — | | | | | | (8,450) | | |
Cash payments on restructuring liabilities | | | | | — | | | | | | — | | | | | | (983) | | | | | | — | | | | | | — | | | | | | (983) | | |
Insurance proceeds in advance of settlement | | | | | — | | | | | | 8,725 | | | | | | — | | | | | | — | | | | | | — | | | | | | 8,725 | | |
Other | | | | | — | | | | | | — | | | | | | — | | | | | | 1,043 | | | | | | — | | | | | | 1,043 | | |
Net cash provided by (used in) operating activities | | | | | — | | | | | | 19,925 | | | | | | 94,719 | | | | | | (12,716) | | | | | | — | | | | | | 101,928 | | |
Cash flows from investing activities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Capital expenditures | | | | | — | | | | | | (2,530) | | | | | | (34,687) | | | | | | (3,169) | | | | | | — | | | | | | (40,386) | | |
Proceeds from sale of assets | | | | | — | | | | | | — | | | | | | 236 | | | | | | 2,278 | | | | | | — | | | | | | 2,514 | | |
Net cash used in investing activities | | | | | — | | | | | | (2,530) | | | | | | (34,451) | | | | | | (891) | | | | | | — | | | | | | (37,872) | | |
Cash flows from financing activities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Payments on long-term debt | | | | | — | | | | | | (44,300) | | | | | | — | | | | | | — | | | | | | — | | | | | | (44,300) | | |
Proceeds from intercompany investment | | | | | — | | | | | | 42,304 | | | | | | (62,255) | | | | | | 19,951 | | | | | | — | | | | | | | | |
Proceeds from exercises of employee stock options | | | | | — | | | | | | 1,203 | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,203 | | |
Payments to tax authority for employee stock based compensation | | | | | — | | | | | | (1,186) | | | | | | — | | | | | | — | | | | | | — | | | | | | (1,186) | | |
Net cash provided by (used in) financing activities | | | | | — | | | | | | (1,979) | | | | | | (62,255) | | | | | | 19,951 | | | | | | — | | | | | | (44,283) | | |
Impact of exchange rate movement on cash | | | | | — | | | | | | — | | | | | | — | | | | | | 46 | | | | | | — | | | | | | 46 | | |
Net increase (decrease) in cash and cash equivalents | | | | | — | | | | | | 15,416 | | | | | | (1,987) | | | | | | 6,390 | | | | | | — | | | | | | 19,819 | | |
Cash and cash equivalents at the beginning of the period | | | | | — | | | | | | 50,035 | | | | | | (10,918) | | | | | | 12,480 | | | | | | — | | | | | | 51,597 | | |
Cash and cash equivalents at the end of the period | | | | $ | — | | | | | $ | 65,451 | | | | | $ | (12,905) | | | | | $ | 18,870 | | | | | $ | — | | | | | $ | 71,416 | | |
|
(Amounts in thousands) | | | Guarantor Ply Gem Holdings, Inc. | | | Issuer Ply Gem Industries, Inc. | | | Guarantor Subsidiaries | | | Non- Guarantor Subsidiary | | | Consolidating Adjustments | | | Consolidated | | ||||||||||||||||||
Cash flows from operating activities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net income (loss) | | | | $ | 75,487 | | | | | $ | 75,487 | | | | | $ | 162,342 | | | | | $ | (10,766) | | | | | $ | (227,063) | | | | | $ | 75,487 | | |
Adjustments to reconcile net income (loss) to cash provided by (used in) operating activities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Depreciation and amortization expense | | | | | — | | | | | | 164 | | | | | | 49,484 | | | | | | 6,755 | | | | | | — | | | | | | 56,403 | | |
Non-cash restructuring costs | | | | | — | | | | | | — | | | | | | — | | | | | | 427 | | | | | | — | | | | | | 427 | | |
Non-cash interest expense, net | | | | | — | | | | | | 13,710 | | | | | | — | | | | | | — | | | | | | — | | | | | | 13,710 | | |
Gain on foreign currency transactions | | | | | — | | | | | | — | | | | | | — | | | | | | (299) | | | | | | — | | | | | | (299) | | |
Non-cash litigation expense | | | | | — | | | | | | — | | | | | | 1,875 | | | | | | — | | | | | | — | | | | | | 1,875 | | |
Loss on modification or extinguishment of debt | | | | | — | | | | | | 11,747 | | | | | | — | | | | | | — | | | | | | — | | | | | | 11,747 | | |
Stock based compensation | | | | | — | | | | | | 1,067 | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,067 | | |
Deferred income taxes | | | | | — | | | | | | — | | | | | | (56,712) | | | | | | (1,277) | | | | | | — | | | | | | (57,989) | | |
Tax receivable agreement liability adjustment | | | | | — | | | | | | 60,874 | | | | | | — | | | | | | — | | | | | | — | | | | | | 60,874 | | |
Increase in tax uncertainty, net of valuation allowance | | | | | — | | | | | | — | | | | | | 1,059 | | | | | | — | | | | | | — | | | | | | 1,059 | | |
Equity in subsidiaries’ net income | | | | | (75,487) | | | | | | (151,576) | | | | | | — | | | | | | — | | | | | | 227,063 | | | | | | — | | |
Gain on sale of building | | | | | — | | | | | | — | | | | | | (190) | | | | | | — | | | | | | — | | | | | | (190) | | |
Other | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Changes in operating assets and liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Accounts receivable, net | | | | | — | | | | | | — | | | | | | (18,122) | | | | | | 3,413 | | | | | | — | | | | | | (14,709) | | |
Inventories | | | | | — | | | | | | — | | | | | | (12,355) | | | | | | 813 | | | | | | — | | | | | | (11,542) | | |
Prepaid expenses and other current assets | | | | | — | | | | | | (28) | | | | | | (3,166) | | | | | | 227 | | | | | | — | | | | | | (2,967) | | |
Accounts payable | | | | | — | | | | | | 142 | | | | | | (2,449) | | | | | | 3,252 | | | | | | — | | | | | | 945 | | |
Accrued expenses | | | | | — | | | | | | 201 | | | | | | 8,253 | | | | | | 583 | | | | | | — | | | | | | 9,037 | | |
Cash payments on restructuring liabilities | | | | | — | | | | | | — | | | | | | (112) | | | | | | (428) | | | | | | — | | | | | | (540) | | |
Other | | | | | — | | | | | | — | | | | | | — | | | | | | 647 | | | | | | — | | | | | | 647 | | |
Net cash provided by (used in) operating activities | | | | | — | | | | | | 11,788 | | | | | | 129,907 | | | | | | 3,347 | | | | | | — | | | | | | 145,042 | | |
Cash flows from investing activities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Capital expenditures | | | | | — | | | | | | (1,749) | | | | | | (31,070) | | | | | | (3,182) | | | | | | — | | | | | | (36,001) | | |
Proceeds from sale of assets | | | | | — | | | | | | — | | | | | | 55 | | | | | | 128 | | | | | | — | | | | | | 183 | | |
Net cash used in investing activities | | | | | — | | | | | | (1,749) | | | | | | (31,015) | | | | | | (3,054) | | | | | | — | | | | | | (35,818) | | |
Cash flows from financing activities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Payments on long-term debt | | | | | — | | | | | | (164,300) | | | | | | — | | | | | | — | | | | | | — | | | | | | (164,300) | | |
Proceeds from intercompany investment | | | | | — | | | | | | 113,484 | | | | | | (104,866) | | | | | | (8,618) | | | | | | — | | | | | | — | | |
Proceeds from exercises of employee stock options | | | | | — | | | | | | 1,091 | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,091 | | |
Cash payments on tax receivable agreement | | | | | — | | | | | | (4,971) | | | | | | — | | | | | | — | | | | | | — | | | | | | (4,971) | | |
Net cash used in financing activities | | | | | — | | | | | | (54,696) | | | | | | (104,866) | | | | | | (8,618) | | | | | | — | | | | | | (168,180) | | |
Impact of exchange rate movement on cash | | | | | — | | | | | | — | | | | | | — | | | | | | 1,128 | | | | | | — | | | | | | 1,128 | | |
Net decrease in cash and cash equivalents | | | | | — | | | | | | (44,657) | | | | | | (5,974) | | | | | | (7,197) | | | | | | — | | | | | | (57,828) | | |
Cash and cash equivalents at the beginning of the period | | | | | — | | | | | | 94,692 | | | | | | (4,944) | | | | | | 19,677 | | | | | | — | | | | | | 109,425 | | |
Cash and cash equivalents at the end of the period | | | | $ | — | | | | | $ | 50,035 | | | | | $ | (10,918) | | | | | $ | 12,480 | | | | | $ | — | | | | | $ | 51,597 | | |
|
(Amounts in thousands) | | | Guarantor Ply Gem Holdings, Inc. | | | Issuer Ply Gem Industries, Inc. | | | Guarantor Subsidiaries | | | Non- Guarantor Subsidiary | | | Consolidating Adjustments | | | Consolidated | | ||||||||||||||||||
Cash flows from operating activities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net income (loss) | | | | $ | 32,288 | | | | | $ | 32,288 | | | | | $ | 68,217 | | | | | $ | (15,845) | | | | | $ | (84,660) | | | | | $ | 32,288 | | |
Adjustments to reconcile net income (loss) to cash provided by (used in) operating activities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Depreciation and amortization expense | | | | | — | | | | | | 312 | | | | | | 51,079 | | | | | | 7,009 | | | | | | — | | | | | | 58,400 | | |
Fair-value premium on purchased inventory | | | | | — | | | | | | — | | | | | | 54 | | | | | | — | | | | | | — | | | | | | 54 | | |
Non-cash restructuring costs | | | | | — | | | | | | — | | | | | | — | | | | | | 704 | | | | | | — | | | | | | 704 | | |
Non-cash interest expense, net | | | | | — | | | | | | 13,380 | | | | | | — | | | | | | — | | | | | | — | | | | | | 13,380 | | |
Loss on foreign currency transactions | | | | | — | | | | | | — | | | | | | — | | | | | | 3,166 | | | | | | — | | | | | | 3,166 | | |
Stock based compensation | | | | | — | | | | | | 1,960 | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,960 | | |
Deferred income taxes | | | | | — | | | | | | — | | | | | | (3,612) | | | | | | (1,289) | | | | | | — | | | | | | (4,901) | | |
Tax receivable agreement liability adjustment | | | | | — | | | | | | 12,947 | | | | | | — | | | | | | — | | | | | | — | | | | | | 12,947 | | |
Reduction in tax uncertainty, net of valuation allowance | | | | | — | | | | | | — | | | | | | (199) | | | | | | — | | | | | | — | | | | | | (199) | | |
Equity in subsidiaries’ net income (loss) | | | | | (32,288) | | | | | | (52,372) | | | | | | — | | | | | | — | | | | | | 84,660 | | | | | | — | | |
Gain on sale of building | | | | | — | | | | | | — | | | | | | (28) | | | | | | — | | | | | | — | | | | | | (28) | | |
Other | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Changes in operating assets and liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Accounts receivable, net | | | | | — | | | | | | — | | | | | | (10,949) | | | | | | 6,387 | | | | | | — | | | | | | (4,562) | | |
Inventories | | | | | — | | | | | | — | | | | | | 27,963 | | | | | | 1,958 | | | | | | — | | | | | | 29,921 | | |
Prepaid expenses and other current assets | | | | | — | | | | | | 1,165 | | | | | | 5,348 | | | | | | 216 | | | | | | — | | | | | | 6,729 | | |
Accounts payable | | | | | — | | | | | | (4) | | | | | | (11,712) | | | | | | 1,153 | | | | | | — | | | | | | (10,563) | | |
Accrued expenses | | | | | — | | | | | | 1,682 | | | | | | 2,452 | | | | | | (798) | | | | | | — | | | | | | 3,336 | | |
Cash payments on restructuring liabilities | | | | | — | | | | | | — | | | | | | (201) | | | | | | (1,444) | | | | | | — | | | | | | (1,645) | | |
Other | | | | | — | | | | | | — | | | | | | (1,624) | | | | | | — | | | | | | — | | | | | | (1,624) | | |
Net cash provided by operating activities | | | | | — | | | | | | 11,358 | | | | | | 126,788 | | | | | | 1,217 | | | | | | — | | | | | | 139,363 | | |
Cash flows from investing activities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Acquisitions, net of cash acquired | | | | | | | | | | | — | | | | | | (21,000) | | | | | | — | | | | | | — | | | | | | (21,000) | | |
Capital expenditures | | | | | — | | | | | | (2,848) | | | | | | (28,181) | | | | | | (2,831) | | | | | | — | | | | | | (33,860) | | |
Proceeds from sale of assets | | | | | — | | | | | | — | | | | | | 85 | | | | | | 37 | | | | | | — | | | | | | 122 | | |
Net cash used in investing activities | | | | | | | | | | | (2,848) | | | | | | (49,096) | | | | | | (2,794) | | | | | | — | | | | | | (54,738) | | |
Cash flows from financing activities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Payments on long-term debt | | | | | — | | | | | | (4,300) | | | | | | — | | | | | | — | | | | | | — | | | | | | (4,300) | | |
Proceeds from intercompany investment | | | | | — | | | | | | 66,189 | | | | | | (76,791) | | | | | | 10,602 | | | | | | — | | | | | | — | | |
Proceeds from exercises of employee stock options | | | | | — | | | | | | 2,198 | | | | | | — | | | | | | — | | | | | | — | | | | | | 2,198 | | |
Cash payments on tax receivable agreement | | | | | — | | | | | | (48) | | | | | | — | | | | | | — | | | | | | — | | | | | | (48) | | |
Debt issuance costs paid | | | | | — | | | | | | (1,412) | | | | | | — | | | | | | — | | | | | | — | | | | | | (1,412) | | |
Net cash provided by (used in) financing activities | | | | | — | | | | | | 62,627 | | | | | | (76,791) | | | | | | 10,602 | | | | | | — | | | | | | (3,562) | | |
Impact of exchange rate movement on cash | | | | | — | | | | | | — | | | | | | — | | | | | | (4,800) | | | | | | — | | | | | | (4,800) | | |
Net decrease in cash and cash equivalents | | | | | — | | | | | | 71,137 | | | | | | 901 | | | | | | 4,225 | | | | | | — | | | | | | 76,263 | | |
Cash and cash equivalents at the beginning of the period | | | | | — | | | | | | 23,555 | | | | | | (5,845) | | | | | | 15,452 | | | | | | — | | | | | | 33,162 | | |
Cash and cash equivalents at the end of the period | | | | $ | — | | | | | $ | 94,692 | | | | | $ | (4,944) | | | | | $ | 19,677 | | | | | $ | — | | | | | $ | 109,425 | | |
|
| | | Siding, Fencing, and Stone | | |||||||||||||||
| | | As of November 25, 2017 | | | As of November 26, 2016 | | | As of November 28, 2015 | | |||||||||
Assumptions: | | | | | | | | | | | | | | | | | | | |
Income approach: | | | | | | | | | | | | | | | | | | | |
Estimated housing starts in terminal year | | | | | 1,049,000 | | | | | | 1,100,000 | | | | | | 1,100,000 | | |
Terminal growth rate | | | 3.0% | | | 3.0% | | | 3.0% | | |||||||||
Discount rate | | | 11.5% | | | 11.0% | | | 11.5% | | |||||||||
Market approach: | | | | | | | | | | | | | | | | | | | |
Control premiums | | | 5.0% | | | 5.0% | | | 5.0% | | |||||||||
Sensitivities: | | | | | | | | | | | | | | | | | | | |
(Amounts in thousands) | | | | | | | | | | | | | | | | | | | |
Estimated fair value decrease in the event of a 1% decrease in the terminal year growth | | | | $ | 121,553 | | | | | $ | 116,628 | | | | | $ | 104,863 | | |
Estimated fair value decrease in the event of a 1% increase in the discount rate | | | | | 203,109 | | | | | | 203,838 | | | | | | 189,363 | | |
Estimated fair value decrease in the event of a 1% decrease in the control premium | | | | | 17,141 | | | | | | 17,363 | | | | | | 16,790 | | |
| | | Windows and Doors | | |||||||||||||||
| | | As of November 25, 2017 | | | As of November 26, 2016 | | | As of November 28, 2015 | | |||||||||
Assumptions: | | | | | | | | | | | | | | | | | | | |
Income approach: | | | | | | | | | | | | | | | | | | | |
Estimated housing starts in terminal year | | | | | 1,049,000 | | | | | | 1,100,000 | | | | | | 1,100,000 | | |
Terminal growth rate | | | | | 3.5% | | | | | | 3.5% | | | | | | 3.5% | | |
Discount rate | | | | | 18.0% | | | | | | 16.0% | | | | | | 17.0% | | |
Market approach: | | | | | |||||||||||||||
Control premiums | | | | | 10.0% | | | | | | 10.0% | | | | | | 10.0% | | |
Sensitivities: | | | | | |||||||||||||||
(Amounts in thousands) | | | | | | | | | | | | | | | | | | | |
Estimated fair value decrease in the event of a 1% decrease in the terminal year growth | | | | $ | 18,582 | | | | | $ | 14,695 | | | | | $ | 12,554 | | |
Estimated fair value decrease in the event of a 1% increase in the discount rate | | | | | 43,485 | | | | | | 37,662 | | | | | | 35,285 | | |
Estimated fair value decrease in the event of a 1% decrease in the control premium | | | | | 5,568 | | | | | | 4,885 | | | | | | 4,451 | | |
(Amounts in thousands) | | | As of November 25, 2017 | | | As of November 26, 2016 | | | As of November 28, 2015 | | | |||||||||||
Estimated Windows and Doors reporting unit fair value increase (decrease) in the event of a 10% increase in the weighting of the market multiples method | | | | $ | (5,000) | | | | | $ | 4,000 | | | | | $ | 3,000 | | | | ||
Estimated Siding, Fencing, and Stone reporting unit fair value increase (decrease) in the event of a 10% increase in the weighting of the market multiples method | | | | | (10,000) | | | | | | 3,000 | | | | | | 2,000 | | | | | |
| | | Year ended December 31, | | |||||||||||||||
(Amounts in thousands) | | | 2017 | | | 2016 | | | 2015 | | |||||||||
Net Sales | | | | | | | | | | | | | | | | | | | |
Siding, Fencing, and Stone | | | | $ | 970,198 | | | | | $ | 886,851 | | | | | $ | 840,118 | | |
Windows and Doors | | | | | 1,086,105 | | | | | | 1,024,993 | | | | | | 999,608 | | |
Operating earnings (loss) | | | | | | | | | | | | | | | | | | | |
Siding, Fencing, and Stone | | | | | 146,753 | | | | | | 157,058 | | | | | | 134,654 | | |
Windows and Doors | | | | | 56,435 | | | | | | 43,579 | | | | | | 18,195 | | |
Unallocated | | | | | (28,930) | | | | | | (32,141) | | | | | | (30,317) | | |
Foreign currency gain (loss) | | | | | | | | | | | | | | | | | | | |
Siding, Fencing, and Stone | | | | | 303 | | | | | | 204 | | | | | | (954) | | |
Windows and Doors | | | | | 1,060 | | | | | | 95 | | | | | | (2,212) | | |
Interest income (expense), net | | | | | | | | | | | | | | | | | | | |
Siding, Fencing, and Stone | | | | | 29 | | | | | | 16 | | | | | | 22 | | |
Windows and Doors | | | | | 21 | | | | | | 12 | | | | | | 17 | | |
Unallocated | | | | | (69,333) | | | | | | (72,710) | | | | | | (74,858) | | |
Income tax benefit (expense) | | | | | | | | | | | | | | | | | | | |
Unallocated | | | | | (46,654) | | | | | | 51,995 | | | | | | 688 | | |
| | | Year ended December 31, | | |||||||||||||||
(Amounts in thousands) | | | 2017 | | | 2016 | | | 2015 | | |||||||||
Loss on modification or extinguishment of debt | | | | | | | | | | | | | | | | | | | |
Unallocated | | | | | (2,106) | | | | | | (11,747) | | | | | | — | | |
Tax receivable agreement liability adjustment | | | | | | | | | | | | | | | | | | | |
Unallocated | | | | | 10,749 | | | | | | (60,874) | | | | | | (12,947) | | |
Net income | | | | $ | 68,327 | | | | | $ | 75,487 | | | | | $ | 32,288 | | |
| | | Year ended December 31, | | |||||||||||||||||||||||||||||||||
(Amounts in thousands) | | | 2017 | | | 2016 | | | 2015 | | |||||||||||||||||||||||||||
Statement of operations data: | | | | | | | | ||||||||||||||||||||||||||||||
Net sales | | | | $ | 970,198 | | | | | | 100.0% | | | | | $ | 886,851 | | | | | | 100.0% | | | | | $ | 840,118 | | | | | | 100.0% | | |
Gross profit | | | | | 248,249 | | | | | | 25.6% | | | | | | 259,485 | | | | | | 29.3% | | | | | | 238,326 | | | | | | 28.4% | | |
SG&A expense | | | | | 92,541 | | | | | | 9.5% | | | | | | 89,704 | | | | | | 10.1% | | | | | | 90,760 | | | | | | 10.8% | | |
Amortization of intangible assets | | | | | 8,955 | | | | | | 0.9% | | | | | | 12,723 | | | | | | 1.4% | | | | | | 12,912 | | | | | | 1.5% | | |
Operating earnings | | | | | 146,753 | | | | | | 15.1% | | | | | | 157,058 | | | | | | 17.7% | | | | | | 134,654 | | | | | | 16.0% | | |
Currency transaction gain (loss) | | | | | 303 | | | | | | —% | | | | | | 204 | | | | | | —% | | | | | | (954) | | | | | | (0.1)% | | |
| | | Year ended December 31, | | |||||||||||||||||||||||||||||||||
(Amounts in thousands) | | | 2017 | | | 2016 | | | 2015 | | |||||||||||||||||||||||||||
Statement of operations data: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net sales | | | | $ | 1,086,105 | | | | | | 100.0% | | | | | $ | 1,024,993 | | | | | | 100.0% | | | | | $ | 999,608 | | | | | | 100.0% | | |
Gross profit | | | | | 220,264 | | | | | | 20.3% | | | | | | 202,789 | | | | | | 19.8% | | | | | | 181,386 | | | | | | 18.1% | | |
SG&A expense | | | | | 151,513 | | | | | | 14.0% | | | | | | 146,869 | | | | | | 14.3% | | | | | | 150,797 | | | | | | 15.1% | | |
Amortization of intangible assets | | | | | 12,316 | | | | | | 1.1% | | | | | | 12,341 | | | | | | 1.2% | | | | | | 12,394 | | | | | | 1.2% | | |
Operating earnings | | | | | 56,435 | | | | | | 5.2% | | | | | | 43,579 | | | | | | 4.3% | | | | | | 18,195 | | | | | | 1.8% | | |
Currency transaction gain (loss) | | | | | 1,060 | | | | | | 0.1% | | | | | | 95 | | | | | | —% | | | | | | (2,212) | | | | | | (0.2)% | | |
| | | Year ended December 31, | | |||||||||||||||||||||||||||||||||
(Amounts in thousands) | | | 2017 | | | 2016 | | | 2015 | | |||||||||||||||||||||||||||
Statement of operations data: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net sales | | | | $ | 1,086,105 | | | | | | 100.0% | | | | | $ | 1,024,993 | | | | | | 100.0% | | | | | $ | 999,608 | | | | | | 100.0% | | |
Gross profit | | | | | 220,264 | | | | | | 20.3% | | | | | | 202,789 | | | | | | 19.8% | | | | | | 181,386 | | | | | | 18.1% | | |
SG&A expense | | | | | 151,513 | | | | | | 14.0% | | | | | | 146,869 | | | | | | 14.3% | | | | | | 150,797 | | | | | | 15.1% | | |
Amortization of intangible assets | | | | | 12,316 | | | | | | 1.1% | | | | | | 12,341 | | | | | | 1.2% | | | | | | 12,394 | | | | | | 1.2% | | |
Operating earnings | | | | | 56,435 | | | | | | 5.2% | | | | | | 43,579 | | | | | | 4.3% | | | | | | 18,195 | | | | | | 1.8% | | |
Currency transaction gain (loss) | | | | | 1,060 | | | | | | 0.1% | | | | | | 95 | | | | | | —% | | | | | | (2,212) | | | | | | (0.2)% | | |
| | | Year ended December 31, | | |||||||||||||||
(Amounts in thousands) | | | 2017 | | | 2016 | | | 2015 | | |||||||||
Statement of operations data: | | | | | | | | | | | | | | | | | | | |
SG&A expense | | | | $ | (28,930) | | | | | $ | (32,141) | | | | | $ | (30,317) | | |
Operating loss | | | | | (28,930) | | | | | | (32,141) | | | | | | (30,317) | | |
Interest expense | | | | | (69,363) | | | | | | (72,716) | | | | | | (74,863) | | |
Interest income | | | | | 30 | | | | | | 6 | | | | | | 5 | | |
Tax receivable agreement liability adjustment | | | | | 10,749 | | | | | | (60,874) | | | | | | (12,947) | | |
Loss on modification or extinguishment of debt | | | | | (2,106) | | | | | | (11,747) | | | | | | — | | |
(Provision) benefit for income taxes | | | | $ | (46,654) | | | | | $ | 51,995 | | | | | $ | 688 | | |
(Amounts in thousands) | | | For the year ended | | |||||||||
| December 31, 2017 | | | December 31, 2016 | | ||||||||
Loss on modification of debt: | | | | | | | | | | | | | |
Term Loan Facility unamortized discount | | | | $ | (1,681) | | | | | $ | (9,375) | | |
Term Loan Facility unamortized debt issuance costs | | | | | (425) | | | | | | (2,372) | | |
Total loss on modification or extinguishment of debt | | | | $ | (2,106) | | | | | $ | (11,747) | | |
|
(Amounts in thousands) | | | Total Amount | | | Less Than 1 Year | | | 1 – 3 Years | | | 3 – 5 Years | | | More than 5 Years | | |||||||||||||||
Long-term debt(1) | | | | $ | 883,875 | | | | | $ | 4,300 | | | | | $ | 28,600 | | | | | $ | 850,975 | | | | | $ | — | | |
Interest payments(2) | | | | | 225,142 | | | | | | 53,841 | | | | | | 105,489 | | | | | | 65,812 | | | | | | — | | |
Non-cancelable lease commitments(3) | | | | | 140,048 | | | | | | 31,590 | | | | | | 49,578 | | | | | | 33,449 | | | | | | 25,431 | | |
Purchase obligations(4) | | | | | 120,600 | | | | | | 120,600 | | | | | | — | | | | | | — | | | | | | — | | |
Other long-term liabilities(5) | | | | | 13,581 | | | | | | 1,358 | | | | | | 2,716 | | | | | | 2,716 | | | | | | 6,791 | | |
| | | | $ | 1,383,246 | | | | | $ | 211,689 | | | | | $ | 186,383 | | | | | $ | 952,952 | | | | | $ | 32,222 | | |
|
(Amounts in thousands, except shares and per share data) | | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| April 13, 2018 – June 30, 2018 | | | | April 1, 2018 – April 12, 2018 | | | Three months ended July 1, 2017 | | |||||||||||
Net sales | | | | $ | 597,936 | | | | | | $ | 69,739 | | | | | $ | 544,767 | | |
Cost of products sold | | | | | 479,402 | | | | | | | 54,820 | | | | | | 407,879 | | |
Gross profit | | | | | 118,534 | | | | | | | 14,919 | | | | | | 136,888 | | |
Operating expenses: | | | | | | | | | | | | | | | | | | | | |
Selling, general and administrative expenses | | | | | 69,812 | | | | | | | 10,689 | | | | | | 65,531 | | |
Acquisition related expenses | | | | | 11,186 | | | | | | | 67,802 | | | | | | — | | |
Amortization of intangible assets | | | | | 24,096 | | | | | | | 751 | | | | | | 5,258 | | |
Total operating expenses | | | | | 105,094 | | | | | | | 79,242 | | | | | | 70,789 | | |
Operating earnings (loss) | | | | | 13,440 | | | | | | | (64,323) | | | | | | 66,099 | | |
Foreign currency gain (loss) | | | | | (1,516) | | | | | | | 609 | | | | | | 617 | | |
Interest expense | | | | | (43,787) | | | | | | | (2,599) | | | | | | (17,399) | | |
Interest income | | | | | 24 | | | | | | | 2 | | | | | | 19 | | |
Tax receivable agreement liability adjustment | | | | | — | | | | | | | (5,237) | | | | | | — | | |
Income (loss) before provision (benefit) for income taxes | | | | | (31,839) | | | | | | | (71,548) | | | | | | 49,336 | | |
Provision (benefit) for income taxes | | | | | (11,428) | | | | | | | (9,331) | | | | | | 19,477 | | |
Net income (loss) | | | | $ | (20,411) | | | | | | $ | (62,217) | | | | | $ | 29,859 | | |
Comprehensive income (loss) | | | | $ | (27,155) | | | | | | $ | (61,623) | | | | | $ | 30,708 | | |
Net income (loss) attributable to common shareholders per share: | | | | | | | | | | | | | | | | | | | | |
Basic | | | | $ | (3.20) | | | | | | $ | (0.91) | | | | | $ | 0.44 | | |
Diluted | | | | $ | (3.20) | | | | | | $ | (0.91) | | | | | $ | 0.43 | | |
Weighted average shares outstanding: | | | | | | | | | | | | | | | | | | | | |
Basic | | | | | 6,379,748 | | | | | | | 68,644,725 | | | | | | 68,435,315 | | |
Diluted | | | | | 6,379,748 | | | | | | | 68,644,725 | | | | | | 69,019,692 | | |
(Amounts in thousands, except shares and per share data) | | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | Six months ended July 1, 2017 | | |||||||||||
Net sales | | | | $ | 597,936 | | | | | | $ | 529,643 | | | | | $ | 974,782 | | |
Cost of products sold | | | | | 479,402 | | | | | | | 426,674 | | | | | | 748,369 | | |
Gross profit | | | | | 118,534 | | | | | | | 102,969 | | | | | | 226,413 | | |
Operating expenses: | | | | | | | | | | | | | | | | | | | | |
Selling, general and administrative expenses | | | | | 69,812 | | | | | | | 81,364 | | | | | | 137,886 | | |
Acquisition related expenses | | | | | 11,186 | | | | | | | 67,802 | | | | | | — | | |
Amortization of intangible assets | | | | | 24,096 | | | | | | | 6,105 | | | | | | 10,602 | | |
Total operating expenses | | | | | 105,094 | | | | | | | 155,271 | | | | | | 148,488 | | |
Operating earnings (loss) | | | | | 13,440 | | | | | | | (52,302) | | | | | | 77,925 | | |
Foreign currency gain (loss) | | | | | (1,516) | | | | | | | (132) | | | | | | 772 | | |
Interest expense | | | | | (43,787) | | | | | | | (19,054) | | | | | | (34,285) | | |
Interest income | | | | | 24 | | | | | | | 22 | | | | | | 33 | | |
Tax receivable agreement liability adjustment | | | | | — | | | | | | | (5,237) | | | | | | — | | |
Income (loss) before provision (benefit) for income taxes | | | | | (31,839) | | | | | | | (76,703) | | | | | | 44,445 | | |
Provision (benefit) for income taxes | | | | | (11,428) | | | | | | | (9,923) | | | | | | 18,223 | | |
Net income (loss) | | | | $ | (20,411) | | | | | | $ | (66,780) | | | | | $ | 26,222 | | |
Comprehensive income (loss) | | | | $ | (27,155) | | | | | | $ | (67,106) | | | | | $ | 27,090 | | |
Net income (loss) attributable to common shareholders per share: | | | | | | | | | | | | | | | | | | | | |
Basic | | | | $ | (3.20) | | | | | | $ | (0.97) | | | | | $ | 0.38 | | |
Diluted | | | | $ | (3.20) | | | | | | $ | (0.97) | | | | | $ | 0.38 | | |
Weighted average shares outstanding: | | | | | | | | | | | | | | | | | | | | |
Basic | | | | | 6,379,748 | | | | | | | 68,557,814 | | | | | | 68,417,602 | | |
Diluted | | | | | 6,379,748 | | | | | | | 68,557,814 | | | | | | 68,988,527 | | |
(Amounts in thousands, except share amounts) | | | Successor | | | Predecessor | | ||||||
| June 30, 2018 | | | December 31, 2017 | | ||||||||
ASSETS | | | | | | | | | | | | | |
Current Assets: | | | | | | | | | | | | | |
Cash and cash equivalents | | | | $ | 53,609 | | | | | $ | 71,416 | | |
Accounts receivable, less allowances of $4,287 and $3,137, respectively | | | | | 340,107 | | | | | | 249,533 | | |
Inventories: | | | | | | | | | | | | | |
Raw materials | | | | | 111,123 | | | | | | 79,330 | | |
Work in process | | | | | 41,882 | | | | | | 36,440 | | |
Finished goods | | | | | 103,220 | | | | | | 80,721 | | |
Total inventory | | | | | 256,225 | | | | | | 196,491 | | |
Prepaid expenses and other current assets | | | | | 25,964 | | | | | | 45,900 | | |
Total current assets | | | | | 675,905 | | | | | | 563,340 | | |
Property and Equipment: | | | | | | | | | | | | | |
Land | | | | | 7,007 | | | | | | 8,229 | | |
Buildings and improvements | | | | | 71,859 | | | | | | 68,005 | | |
Machinery and equipment | | | | | 231,808 | | | | | | 450,554 | | |
Total property and equipment | | | | | 310,674 | | | | | | 526,788 | | |
Less accumulated depreciation | | | | | (6,985) | | | | | | (352,256) | | |
Total property and equipment, net | | | | | 303,689 | | | | | | 174,532 | | |
Other Assets: | | | | | | | | | | | | | |
Intangible assets, net | | | | | 1,662,152 | | | | | | 83,675 | | |
Goodwill | | | | | 1,232,392 | | | | | | 480,563 | | |
Deferred income taxes | | | | | — | | | | | | 10,523 | | |
Other | | | | | 12,108 | | | | | | 6,934 | | |
Total other assets | | | | | 2,906,652 | | | | | | 581,695 | | |
| | | | $ | 3,886,246 | | | | | $ | 1,319,567 | | |
LIABILITIES AND STOCKHOLDERS’ EQUITY | | | | | | | | | | | | | |
Current Liabilities: | | | | | | | | | | | | | |
Accounts payable | | | | $ | 113,793 | | | | | $ | 85,720 | | |
Accrued expenses | | | | | 237,640 | | | | | | 185,857 | | |
Current portion of payable to related parties pursuant to tax receivable agreement | | | | | 24,894 | | | | | | 51,356 | | |
Current portion of long-term debt | | | | | 17,550 | | | | | | 4,300 | | |
Total current liabilities | | | | | 393,877 | | | | | | 327,233 | | |
Deferred income taxes | | | | | 332,513 | | | | | | 1,530 | | |
Long-term portion of payable to related parties pursuant to tax receivable agreement | | | | | 23,362 | | | | | | 18,125 | | |
Other long-term liabilities | | | | | 91,076 | | | | | | 83,424 | | |
Long-term debt | | | | | 2,434,598 | | | | | | 807,334 | | |
Commitments and contingencies | | | | | | | | | | | | | |
Stockholders’ Equity: | | | | | | | | | | | | | |
Preferred stock $0.01 par, 50,000,000 shares authorized, none issued and outstanding at December 31, 2017 (Predecessor) | | | | | — | | | | | | — | | |
Common stock $0.01 par, 6,379,748 issued and outstanding at June 30, 2018 (Successor) and common stock $0.01 par, 250,000,000 shares authorized 68,515,697 issued and outstanding at December 31, 2017 (Predecessor) | | | | | 64 | | | | | | 685 | | |
Additional paid-in-capital | | | | | 637,911 | | | | | | 756,096 | | |
Accumulated deficit | | | | | (20,411) | | | | | | (645,090) | | |
Accumulated other comprehensive loss | | | | | (6,744) | | | | | | (29,770) | | |
Total stockholders’ equity | | | | | 610,820 | | | | | | 81,921 | | |
| | | | $ | 3,886,246 | | | | | $ | 1,319,567 | | |
|
(Amounts in thousands) | | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | Six months ended July 1, 2017 | | |||||||||||
Cash flows from operating activities: | | | | | | | | | | | | | | | | | | | | |
Net income (loss) | | | | $ | (20,411) | | | | | | $ | (66,780) | | | | | $ | 26,222 | | |
Adjustments to reconcile net income (loss) to cash used in operating activities: | | | | | | | | | | | | | | | | | | | | |
Depreciation and amortization expense | | | | | 31,081 | | | | | | | 15,274 | | | | | | 26,555 | | |
Fair-value premium on purchased inventory | | | | | 35,443 | | | | | | | — | | | | | | — | | |
Non-cash acquisition costs | | | | | — | | | | | | | 37,922 | | | | | | — | | |
Non-cash restructuring costs | | | | | 1,121 | | | | | | | 127 | | | | | | 1,064 | | |
Non-cash interest expense, net | | | | | 8,004 | | | | | | | 3,748 | | | | | | 6,997 | | |
(Gain) loss on foreign currency transactions | | | | | 1,516 | | | | | | | 132 | | | | | | (772) | | |
Stock based compensation | | | | | — | | | | | | | 239 | | | | | | 422 | | |
Deferred income taxes | | | | | (22,944) | | | | | | | (108) | | | | | | 15,508 | | |
Tax receivable agreement liability adjustment | | | | | — | | | | | | | 5,237 | | | | | | — | | |
Increase (reduction) in tax uncertainty | | | | | 2 | | | | | | | 93 | | | | | | (65) | | |
Gain on sale of building | | | | | — | | | | | | | — | | | | | | (1,880) | | |
Other | | | | | 22 | | | | | | | (2) | | | | | | (54) | | |
Changes in operating assets and liabilities: | | | | | | | | | | | | | | | | | | | | |
Accounts receivable, net | | | | | (69,797) | | | | | | | 5,251 | | | | | | (85,918) | | |
Inventories | | | | | (3,326) | | | | | | | (38,638) | | | | | | (32,870) | | |
Prepaid expenses and other assets | | | | | 15,341 | | | | | | | 27,760 | | | | | | (1,858) | | |
Accounts payable | | | | | (6,188) | | | | | | | 14,253 | | | | | | 27,227 | | |
Accrued expenses | | | | | 49,619 | | | | | | | (7,372) | | | | | | (6,909) | | |
Cash payments on restructuring liabilities | | | | | (339) | | | | | | | (218) | | | | | | (257) | | |
Securities litigation settlement payment | | | | | — | | | | | | | (9,299) | | | | | | — | | |
Cash payments on acquisition related expenses | | | | | (52,673) | | | | | | | (20,343) | | | | | | — | | |
Other | | | | | (1,614) | | | | | | | (630) | | | | | | (311) | | |
Net cash used in operating activities | | | | | (35,143) | | | | | | | (33,354) | | | | | | (26,899) | | |
Cash flows from investing activities: | | | | | | | | | | | | | | | | | | | | |
Acquisitions, net of cash acquired | | | | | (2,754,799) | | | | | | | — | | | | | | — | | |
Capital expenditures | | | | | (10,008) | | | | | | | (11,288) | | | | | | (17,895) | | |
Proceeds from sale of assets | | | | | — | | | | | | | 11 | | | | | | 2,424 | | |
Net cash used in investing activities | | | | | (2,764,807) | | | | | | | (11,277) | | | | | | (15,471) | | |
Cash flows from financing activities: | | | | | | | | | | | | | | | | | | | | |
Proceeds from long-term debt | | | | | 2,376,712 | | | | | | | — | | | | | | — | | |
Net revolver borrowings | | | | | 130,000 | | | | | | | 40,000 | | | | | | — | | |
Payments on long-term debt | | | | | — | | | | | | | (1,075) | | | | | | (2,150) | | |
Cash payments on tax receivable agreement | | | | | — | | | | | | | (26,462) | | | | | | — | | |
Proceeds from equity contribution | | | | | 425,203 | | | | | | | — | | | | | | — | | |
Payments to tax authority for employee stock based compensation | | | | | — | | | | | | | — | | | | | | (1,186) | | |
Proceeds from exercises of employee stock options | | | | | — | | | | | | | 2,862 | | | | | | 745 | | |
Cash payments on appraisal shares liability | | | | | (19,537) | | | | | | | — | | | | | | — | | |
Debt issuance costs paid | | | | | (56,892) | | | | | | | — | | | | | | — | | |
Net cash provided by (used in) financing activities | | | | | 2,855,486 | | | | | | | 15,325 | | | | | | (2,591) | | |
Impact of exchange rate movements on cash | | | | | (1,927) | | | | | | | (55) | | | | | | 536 | | |
Net increase (decrease) in cash and cash equivalents | | | | | 53,609 | | | | | | | (29,361) | | | | | | (44,425) | | |
Cash and cash equivalents at the beginning of the period | | | | | — | | | | | | | 71,416 | | | | | | 51,597 | | |
Cash and cash equivalents at the end of the period | | | | $ | 53,609 | | | | | | $ | 42,055 | | | | | $ | 7,172 | | |
| | | | | | | | | | | |
Siding, Fencing, and Stone Net Sales Disaggregation | | | For the three months ended | | |||||||||
| June 30, 2018 | | | July 1, 2017 | | ||||||||
Vinyl siding | | | | $ | 145,014 | | | | | $ | 146,612 | | |
Metal | | | | | 76,846 | | | | | | 67,275 | | |
Injection molded | | | | | 22,049 | | | | | | 20,506 | | |
Stone | | | | | 3,664 | | | | | | 4,519 | | |
Other products | | | | | 29,414 | | | | | | 24,681 | | |
Total | | | | $ | 276,987 | | | | | $ | 263,593 | | |
|
Siding, Fencing, and Stone Net Sales Disaggregation | | | For the six months ended | | |||||||||
| June 30, 2018 | | | July 1, 2017 | | ||||||||
Vinyl siding | | | | $ | 250,495 | | | | | $ | 250,016 | | |
Metal | | | | | 126,439 | | | | | | 117,910 | | |
Injection molded | | | | | 34,540 | | | | | | 35,086 | | |
Stone | | | | | 12,636 | | | | | | 13,011 | | |
Other products | | | | | 49,022 | | | | | | 38,407 | | |
Total | | | | $ | 473,132 | | | | | $ | 454,430 | | |
|
Windows and Doors Net Sales Disaggregation | | | For the three months ended | | | For the three months ended | | ||||||||||||||||||
| June 30, 2018 | | | July 1, 2017 | | ||||||||||||||||||||
| New Construction | | | Repair & Remodel | | | New Construction | | | Repair & Remodel | | ||||||||||||||
Vinyl | | | | $ | 234,193 | | | | | $ | 139,254 | | | | | $ | 176,919 | | | | | $ | 83,700 | | |
Aluminum | | | | | 6,439 | | | | | | 40 | | | | | | 10,484 | | | | | | — | | |
Other | | | | | 9,403 | | | | | | 1,359 | | | | | | 10,023 | | | | | | 48 | | |
Total | | | | $ | 250,035 | | | | | $ | 140,653 | | | | | $ | 197,426 | | | | | $ | 83,748 | | |
|
Windows and Doors Net Sales Disaggregation | | | For the six months ended | | | For the six months ended | | ||||||||||||||||||
| June 30, 2018 | | | July 1, 2017 | | ||||||||||||||||||||
| New Construction | | | Repair & Remodel | | | New Construction | | | Repair & Remodel | | ||||||||||||||
Vinyl | | | | $ | 402,470 | | | | | $ | 207,269 | | | | | $ | 332,273 | | | | | $ | 146,618 | | |
Aluminum | | | | | 24,393 | | | | | | 40 | | | | | | 19,826 | | | | | | — | | |
Other | | | | | 18,861 | | | | | | 1,414 | | | | | | 21,564 | | | | | | 71 | | |
Total | | | | $ | 445,724 | | | | | $ | 208,723 | | | | | $ | 373,663 | | | | | $ | 146,689 | | |
|
| Buildings and improvements | | | 8 – 25 years | |
| Machinery and equipment, including leases | | | 5 – 8 years | |
| Leasehold improvements | | | Term of lease or useful life, whichever is shorter | |
(Amounts in thousands) | | | June 30, 2018 | | | December 31, 2017 | | ||||||
Foreign currency hedge included in other current assets | | | | $ | 988 | | | | | $ | 6 | | |
(Amounts in thousands) Description | | | Carrying Value | | | Fair Value Total | | | Quoted Prices in Active Markets for Identical Assets (Level 1) | | | Significant Other Observable Inputs (Level 2) | | | Significant Unobservable Inputs (Level 3) | | |||||||||||||||
Liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Senior Notes – 8.00% | | | | $ | 645,000 | | | | | $ | 665,963 | | | | | $ | 665,963 | | | | | $ | — | | | | | $ | — | | |
Term Loan Facility | | | | | 1,755,000 | | | | | | 1,749,524 | | | | | | — | | | | | | 1,749,524 | | | | | | — | | |
As of June 30, 2018 | | | | $ | 2,400,000 | | | | | $ | 2,415,487 | | | | | $ | 665,963 | | | | | $ | 1,749,524 | | | | | $ | — | | |
Liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Senior Notes – 6.50% | | | | $ | 650,000 | | | | | $ | 671,970 | | | | | $ | 671,970 | | | | | $ | — | | | | | $ | — | | |
Term Loan Facility | | | | | 213,875 | | | | | | 215,479 | | | | | | — | | | | | | 215,479 | | | | | | — | | |
As of December 31, 2017 | | | | $ | 863,875 | | | | | $ | 887,449 | | | | | $ | 671,970 | | | | | $ | 215,479 | | | | | $ | — | | |
|
(Amounts in thousands) | | | | | | | |
Assets acquired: | | | | | | | |
Accounts receivable | | | | $ | 270,758 | | |
Inventories | | | | | 288,518 | | |
Prepaid expenses and other current assets | | | | | 32,966 | | |
Property and equipment | | | | | 301,963 | | |
Intangible assets (tradenames/customer relationships) | | | | | 1,689,600 | | |
Goodwill | | | | | 1,235,096 | | |
Other assets | | | | | 12,923 | | |
Total assets acquired | | | | | 3,831,824 | | |
Liabilities assumed: | | | | | | | |
Accounts payable(1) | | | | | 119,882 | | |
Tax receivable agreement liability | | | | | 48,256 | | |
Other liabilities | | | | | 146,354 | | |
Accrued long-term warranty | | | | | 67,364 | | |
Deferred income taxes | | | | | 358,658 | | |
Other long-term liabilities | | | | | 26,997 | | |
Total liabilities assumed | | | | | 767,511 | | |
Net assets acquired | | | | $ | 3,064,313 | | |
|
| Professional fees | | | | $ | 32,059 | | |
| Long-term incentive plan liability acceleration based on change of control | | | | | 29,626 | | |
| Transaction bonuses | | | | | 8,900 | | |
| Other | | | | | 8,403 | | |
| | | | | $ | 78,988 | | |
|
| | | Successor | | | Predecessor | | ||||||
(Amounts in thousands) | | | June 30, 2018 | | | December 31, 2017 | | ||||||
Siding, Fencing and Stone | | | | $ | 713,649 | | | | | $ | 349,954 | | |
Windows and Doors | | | | | 518,743 | | | | | | 130,609 | | |
| | | | $ | 1,232,392 | | | | | $ | 480,563 | | |
|
(Amounts in thousands) | | | Windows and Doors | | | Siding, Fencing and Stone | | ||||||
Balance as of December 31, 2017 | | | | | | | | | | | | | |
Goodwill | | | | $ | 458,382 | | | | | $ | 472,181 | | |
Accumulated impairment losses | | | | | (327,773) | | | | | | (122,227) | | |
| | | | $ | 130,609 | | | | | $ | 349,954 | | |
Currency translation adjustments | | | | | (267) | | | | | | (577) | | |
Balance as of April 12, 2018 | | | | | | | | | | | | | |
Goodwill | | | | | 458,115 | | | | | | 471,604 | | |
Accumulated impairment losses | | | | | (327,773) | | | | | | (122,227) | | |
| | | | $ | 130,342 | | | | | $ | 349,377 | | |
Elimination of Predecessor goodwill | | | | | (130,342) | | | | | | (349,377) | | |
Goodwill recognized from Merger | | | | | 520,365 | | | | | | 714,731 | | |
Currency translation adjustments | | | | | (1,622) | | | | | | (1,082) | | |
Balance as of June 30, 2018 | | | | | | | | | | | | | |
Goodwill | | | | $ | 518,743 | | | | | $ | 713,649 | | |
|
(Amounts in thousands) | | | Average Amortization Period (in Years) | | | Cost | | | Accumulated Amortization | | | Net Carrying Value | | ||||||||||||
As of June 30, 2018 | | | | | | | | | | | | | | | | | | | | | | | | | |
Trademarks/Tradenames | | | | | 15 | | | | | $ | 182,700 | | | | | $ | (2,636) | | | | | $ | 180,064 | | |
Customer relationships | | | | | 15 | | | | | | 1,503,548 | | | | | | (21,460) | | | | | | 1,482,088 | | |
Total intangible assets | | | | | 15 | | | | | $ | 1,686,248 | | | | | $ | (24,096) | | | | | $ | 1,662,152 | | |
As of December 31, 2017 | | | | | | | | | | | | | | | | | | | | | | | | | |
Patents | | | | | 14 | | | | | $ | 12,770 | | | | | $ | (12,261) | | | | | $ | 509 | | |
Trademarks/Tradenames | | | | | 12 | | | | | | 117,473 | | | | | | (88,853) | | | | | | 28,620 | | |
Customer relationships | | | | | 13 | | | | | | 219,614 | | | | | | (166,086) | | | | | | 53,528 | | |
Other | | | | | 4 | | | | | | 5,750 | | | | | | (4,732) | | | | | | 1,018 | | |
Total intangible assets | | | | | 12 | | | | | $ | 355,607 | | | | | $ | (271,932) | | | | | $ | 83,675 | | |
|
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
(Amounts in thousands) | | | April 13, 2018 – June 30, 2018 | | | | April 1, 2018 – April 12, 2018 | | | Three months ended July 1, 2017 | | |||||||||
Amortization expense | | | | $ | 24,096 | | | | | | $ | 751 | | | | | $ | 5,258 | | |
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
(Amounts in thousands) | | | April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | Six months ended July 1, 2017 | | |||||||||
Amortization expense | | | | $ | 24,096 | | | | | | $ | 6,105 | | | | | $ | 10,602 | | |
(Amounts in thousands) | | | Amortization expense | | |||
2018 (remainder of year) | | | | $ | 57,067 | | |
2019 | | | | | 112,640 | | |
2020 | | | | | 112,640 | | |
2021 | | | | | 112,640 | | |
2022 | | | | | 112,640 | | |
(Amounts in thousands) | | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| April 13, 2018 – June 30, 2018 | | | | April 1, 2018 – April 12, 2018 | | | Three months ended July 1, 2017 | | |||||||||||
Net income (loss) | | | | $ | (20,411) | | | | | | $ | (62,217) | | | | | $ | 29,859 | | |
Foreign currency translation adjustment | | | | | (7,486) | | | | | | | 1,204 | | | | | | 1,279 | | |
Unrealized gain (loss) on derivative instruments | | | | | 742 | | | | | | | (610) | | | | | | (430) | | |
Comprehensive income (loss) | | | | $ | (27,155) | | | | | | $ | (61,623) | | | | | $ | 30,708 | | |
| | | | | | | | | | | |
(Amounts in thousands) | | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | Six months ended July 1, 2017 | | |||||||||||
Net income (loss) | | | | $ | (20,411) | | | | | | $ | (66,780) | | | | | $ | 26,222 | | |
Foreign currency translation adjustment | | | | | (7,486) | | | | | | | (643) | | | | | | 1,844 | | |
Unrealized gain (loss) on derivative instruments | | | | | 742 | | | | | | | 317 | | | | | | (976) | | |
Comprehensive income (loss) | | | | $ | (27,155) | | | | | | $ | (67,106) | | | | | $ | 27,090 | | |
| | | | | | | | | | | |
| | | Successor | | | Predecessor | | ||||||
(Amounts in thousands) | | | June 30, 2018 | | | December 31, 2017 | | ||||||
Senior secured asset based revolving credit facility | | | | $ | 130,000 | | | | | $ | — | | |
Term Loan Facility due 2021, net of unamortized early tender premium, discount, and debt issuance costs of $0 and $10,560, respectively | | | | | — | | | | | | 203,315 | | |
Cash Flow Revolver | | | | | — | | | | | | — | | |
6.50% Senior Notes due 2022, net of unamortized early tender premium, discount, and debt issuance costs of $0 and $41,681, respectively | | | | | — | | | | | | 608,319 | | |
Term Loan Facility due 2025, net of unamortized discount, and debt issuance costs of $51,144 and $0, respectively | | | | | 1,703,856 | | | | | | — | | |
8.00% Senior Notes due 2026, net of unamortized discount, and debt issuance costs of $26,708 and $0, respectively | | | | | 618,292 | | | | | | — | | |
| | | | $ | 2,452,148 | | | | | $ | 811,634 | | |
Less current portion of long-term debt | | | | | (17,550) | | | | | | (4,300) | | |
| | | | $ | 2,434,598 | | | | | $ | 807,334 | | |
|
| | | Rate | | |||
Interest rate | | | | | 6.09% | | |
Effective interest rate | | | | | 7.95% | | |
(in thousands) | | | June 30, 2018 | | |||
Excess availability | | | | $ | 183,812 | | |
Revolving loans outstanding | | | | | 130,000 | | |
Letters of credit outstanding | | | | | 14,341 | | |
(Amounts in thousands) | | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| April 13, 2018 – June 30, 2018 | | | | April 1, 2018 – April 12, 2018 | | | Three months ended July 1, 2017 | | |||||||||||
Service cost | | | | $ | — | | | | | | $ | — | | | | | $ | — | | |
Interest cost | | | | | 360 | | | | | | | 55 | | | | | | 459 | | |
Expected return on plan assets | | | | | (514) | | | | | | | (79) | | | | | | (546) | | |
Amortization of loss | | | | | 306 | | | | | | | 47 | | | | | | 351 | | |
Net periodic benefit expense | | | | $ | 152 | | | | | | $ | 23 | | | | | $ | 264 | | |
| | | | | | | | | | | |
(Amounts in thousands) | | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | Six months ended July 1, 2017 | | |||||||||||
Service cost | | | | $ | — | | | | | | $ | — | | | | | $ | — | | |
Interest cost | | | | | 360 | | | | | | | 470 | | | | | | 917 | | |
Expected return on plan assets | | | | | (514) | | | | | | | (672) | | | | | | (1,093) | | |
Amortization of loss | | | | | 306 | | | | | | | 400 | | | | | | 702 | | |
Net periodic benefit expense | | | | $ | 152 | | | | | | $ | 198 | | | | | $ | 526 | | |
| | | | | | | | | | | |
(Amounts in thousands) | | | June 30, 2018 | | | December 31, 2017 | | ||||||
Product claim liabilities | | | | $ | 138 | | | | | $ | 138 | | |
Multi-employer pension plan withdrawal liability | | | | | 269 | | | | | | 449 | | |
Other | | | | | 241 | | | | | | 439 | | |
| | | | $ | 648 | | | | | $ | 1,026 | | |
|
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
(Amounts in thousands) | | | April 13, 2018 – June 30, 2018 | | | | April 1, 2018 – April 12, 2018 | | | Three months ended July 1, 2017 | | |||||||||
Balance, beginning of period | | | | $ | 78,184 | | | | | | $ | 76,999 | | | | | $ | 78,451 | | |
Acquisition – Atrium | | | | | 8,047 | | | | | | | — | | | | | | — | | |
Warranty expense during period | | | | | 5,895 | | | | | | | 1,961 | | | | | | 5,545 | | |
Settlements made during period | | | | | (6,005) | | | | | | | (776) | | | | | | (5,782) | | |
Balance, end of period | | | | $ | 86,121 | | | | | | $ | 78,184 | | | | | $ | 78,214 | | |
| | | | | | | | | | | |
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
(Amounts in thousands) | | | April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | Six months ended July 1, 2017 | | |||||||||
Balance, beginning of period | | | | $ | 78,184 | | | | | | $ | 77,317 | | | | | $ | 77,293 | | |
Acquisition – Atrium | | | | | 8,047 | | | | | | | — | | | | | | — | | |
Warranty expense during period | | | | | 5,895 | | | | | | | 7,226 | | | | | | 11,708 | | |
Settlements made during period | | | | | (6,005) | | | | | | | (6,359) | | | | | | (10,787) | | |
Balance, end of period | | | | $ | 86,121 | | | | | | $ | 78,184 | | | | | $ | 78,214 | | |
| | | | | | | | | | | |
| | | Successor | | | Predecessor | | ||||||
(Amounts in thousands) | | | June 30, 2018 | | | December 31, 2017 | | ||||||
Insurance | | | | $ | 9,489 | | | | | $ | 7,637 | | |
Employee compensation and benefits | | | | | 24,186 | | | | | | 19,720 | | |
Sales and marketing | | | | | 51,405 | | | | | | 58,131 | | |
Product warranty | | | | | 21,923 | | | | | | 19,652 | | |
Accrued freight | | | | | 4,000 | | | | | | 3,696 | | |
Accrued interest | | | | | 35,659 | | | | | | 18,027 | | |
Accrued pension | | | | | 1,358 | | | | | | 1,358 | | |
Accrued sales returns and discounts | | | | | 2,022 | | | | | | 1,303 | | |
Accrued taxes | | | | | 12,416 | | | | | | 4,735 | | |
Undistributed appraisal shares liability | | | | | 25,362 | | | | | | — | | |
Litigation accrual | | | | | 700 | | | | | | 26,849 | | |
Other | | | | | 49,120 | | | | | | 24,749 | | |
| | | | $ | 237,640 | | | | | $ | 185,857 | | |
|
| | | Successor | | | Predecessor | | ||||||
(Amounts in thousands) | | | June 30, 2018 | | | December 31, 2017 | | ||||||
Insurance | | | | $ | 3,750 | | | | | $ | 595 | | |
Pension liabilities | | | | | 12,677 | | | | | | 12,805 | | |
Multi-employer pension withdrawal liability | | | | | 269 | | | | | | 449 | | |
Product warranty | | | | | 64,198 | | | | | | 57,665 | | |
Long-term environmental liability | | | | | 1,069 | | | | | | 1,075 | | |
Liabilities for tax uncertainties | | | | | 4,717 | | | | | | 4,529 | | |
Litigation accrual | | | | | 644 | | | | | | 731 | | |
Other | | | | | 3,752 | | | | | | 5,575 | | |
| | | | $ | 91,076 | | | | | $ | 83,424 | | |
|
| | | Stock Options | | | Weighted- Average Exercise Price | | | Weighted- Average Remaining Contractual Term (Years) | | |||||||||
Balance at January 1, 2018 | | | | | 2,398,181 | | | | | $ | 14.02 | | | | | | 3.43 | | |
Granted | | | | | — | | | | | | — | | | | | | — | | |
Exercised | | | | | (231,878) | | | | | | 12.35 | | | | | | — | | |
Forfeited or expired | | | | | — | | | | | | — | | | | | | — | | |
April 12, 2018 | | | | | 2,166,303 | | | | | $ | 14.20 | | | | | | 3.34 | | |
|
(Amounts in thousands) | | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| April 13, 2018 – June 30, 2018 | | | | April 1, 2018 – April 12, 2018 | | | Three months ended July 1, 2017 | | |||||||||||
Net sales | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | $ | 247,193 | | | | | | $ | 29,794 | | | | | $ | 263,593 | | |
Windows and Doors | | | | | 350,743 | | | | | ��� | | 39,945 | | | | | | 281,174 | | |
| | | | $ | 597,936 | | | | | | $ | 69,739 | | | | | $ | 544,767 | | |
Operating earnings (loss) | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | $ | 6,815 | | | | | | $ | 2,175 | | | | | $ | 47,580 | | |
Windows and Doors | | | | | 24,704 | | | | | | | 2,417 | | | | | | 24,725 | | |
Unallocated | | | | | (18,079) | | | | | | | (68,915) | | | | | | (6,206) | | |
| | | | $ | 13,440 | | | | | | $ | (64,323) | | | | | $ | 66,099 | | |
| | | | | | | | | | | |
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| | | April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | Six months ended July 1, 2017 | | |||||||||
Net sales | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | $ | 247,193 | | | | | | $ | 225,940 | | | | | $ | 454,430 | | |
Windows and Doors | | | | | 350,743 | | | | | | | 303,703 | | | | | | 520,352 | | |
| | | | $ | 597,936 | | | | | | $ | 529,643 | | | | | $ | 974,782 | | |
Operating earnings (loss) | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | $ | 6,815 | | | | | | $ | 15,974 | | | | | $ | 67,403 | | |
Windows and Doors | | | | | 24,704 | | | | | | | 7,625 | | | | | | 26,154 | | |
Unallocated | | | | | (18,079) | | | | | | | (75,901) | | | | | | (15,632) | | |
| | | | $ | 13,440 | | | | | | $ | (52,302) | | | | | $ | 77,925 | | |
| | | | | | | | | | | |
| | | Total assets as of | | |||||||||
| | | Successor | | | Predecessor | | ||||||
| | | June 30, 2018 | | | December 31, 2017 | | ||||||
Total assets | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | $ | 1,949,149 | | | | | $ | 728,502 | | |
Windows and Doors | | | | | 1,880,625 | | | | | | 500,278 | | |
Unallocated | | | | | 56,472 | | | | | | 90,787 | | |
| | | | $ | 3,886,246 | | | | | $ | 1,319,567 | | |
|
(Amounts in thousands, except shares and per share data) | | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| April 13, 2018 – June 30, 2018 | | | | April 1, 2018 – April 12, 2018 | | | Three months ended July 1, 2017 | | |||||||||||
Net sales | | | | $ | 597,936 | | | | | | $ | 69,739 | | | | | $ | 544,767 | | |
Cost of products sold | | | | | 479,402 | | | | | | | 54,820 | | | | | | 407,879 | | |
Gross profit | | | | | 118,534 | | | | | | | 14,919 | | | | | | 136,888 | | |
Operating expenses: | | | | | | | | | | | | | | | | | | | | |
Selling, general and administrative expenses | | | | | 69,812 | | | | | | | 10,689 | | | | | | 65,531 | | |
Acquisition related expenses | | | | | 11,186 | | | | | | | 67,802 | | | | | | — | | |
Amortization of intangible assets | | | | | 24,096 | | | | | | | 751 | | | | | | 5,258 | | |
Total operating expenses | | | | | 105,094 | | | | | | | 79,242 | | | | | | 70,789 | | |
Operating earnings (loss) | | | | | 13,440 | | | | | | | (64,323) | | | | | | 66,099 | | |
Foreign currency gain (loss) | | | | | (1,516) | | | | | | | 609 | | | | | | 617 | | |
Interest expense | | | | | (43,787) | | | | | | | (2,599) | | | | | | (17,399) | | |
Interest income | | | | | 24 | | | | | | | 2 | | | | | | 19 | | |
Tax receivable agreement liability adjustment | | | | | — | | | | | | | (5,237) | | | | | | — | | |
Income (loss) before provision (benefit) for income taxes | | | | | (31,839) | | | | | | | (71,548) | | | | | | 49,336 | | |
Provision (benefit) for income taxes | | | | | (11,428) | | | | | | | (9,331) | | | | | | 19,477 | | |
Net income (loss) | | | | $ | (20,411) | | | | | | $ | (62,217) | | | | | $ | 29,859 | | |
Comprehensive income (loss) | | | | $ | (27,155) | | | | | | $ | (61,623) | | | | | $ | 30,708 | | |
Net income (loss) attributable to common shareholders per share: | | | | | | | | | | | | | | | | | | | | |
Basic | | | | $ | (3.20) | | | | | | $ | (0.91) | | | | | $ | 0.44 | | |
Diluted | | | | $ | (3.20) | | | | | | $ | (0.91) | | | | | $ | 0.43 | | |
Weighted average shares outstanding: | | | | | | | | | | | | | | | | | | | | |
Basic | | | | | 6,379,748 | | | | | | | 68,644,725 | | | | | | 68,435,315 | | |
Diluted | | | | | 6,379,748 | | | | | | | 68,644,725 | | | | | | 69,019,692 | | |
(Amounts in thousands, except shares and per share data) | | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | Six months ended July 1, 2017 | | |||||||||||
Net sales | | | | $ | 597,936 | | | | | | $ | 529,643 | | | | | $ | 974,782 | | |
Cost of products sold | | | | | 479,402 | | | | | | | 426,674 | | | | | | 748,369 | | |
Gross profit | | | | | 118,534 | | | | | | | 102,969 | | | | | | 226,413 | | |
Operating expenses: | | | | | | | | | | | | | | | | | | | | |
Selling, general and administrative expenses | | | | | 69,812 | | | | | | | 81,364 | | | | | | 137,886 | | |
Acquisition related expenses | | | | | 11,186 | | | | | | | 67,802 | | | | | | — | | |
Amortization of intangible assets | | | | | 24,096 | | | | | | | 6,105 | | | | | | 10,602 | | |
Total operating expenses | | | | | 105,094 | | | | | | | 155,271 | | | | | | 148,488 | | |
Operating earnings (loss) | | | | | 13,440 | | | | | | | (52,302) | | | | | | 77,925 | | |
Foreign currency gain (loss) | | | | | (1,516) | | | | | | | (132) | | | | | | 772 | | |
Interest expense | | | | | (43,787) | | | | | | | (19,054) | | | | | | (34,285) | | |
Interest income | | | | | 24 | | | | | | | 22 | | | | | | 33 | | |
Tax receivable agreement liability adjustment | | | | | — | | | | | | | (5,237) | | | | | | — | | |
Income (loss) before provision (benefit) for income taxes | | | | | (31,839) | | | | | | | (76,703) | | | | | | 44,445 | | |
Provision (benefit) for income taxes | | | | | (11,428) | | | | | | | (9,923) | | | | | | 18,223 | | |
Net income (loss) | | | | $ | (20,411) | | | | | | $ | (66,780) | | | | | $ | 26,222 | | |
Comprehensive income (loss) | | | | $ | (27,155) | | | | | | $ | (67,106) | | | | | $ | 27,090 | | |
Net income (loss) attributable to common shareholders per share: | | | | | | | | | | | | | | | | | | | | |
Basic | | | | $ | (3.20) | | | | | | $ | (0.97) | | | | | $ | 0.38 | | |
Diluted | | | | $ | (3.20) | | | | | | $ | (0.97) | | | | | $ | 0.38 | | |
Weighted average shares outstanding: | | | | | | | | | | | | | | | | | | | | |
Basic | | | | | 6,379,748 | | | | | | | 68,557,814 | | | | | | 68,417,602 | | |
Diluted | | | | | 6,379,748 | | | | | | | 68,557,814 | | | | | | 68,988,527 | | |
(Amounts in thousands, except share amounts) | | | Successor | | | Predecessor | | ||||||
| June 30, 2018 | | | December 31, 2017 | | ||||||||
ASSETS | | | | | | | | | | | | | |
Current Assets: | | | | | | | | | | | | | |
Cash and cash equivalents | | | | $ | 53,609 | | | | | $ | 71,416 | | |
Accounts receivable, less allowances of $4,287 and $3,137, respectively | | | | | 340,107 | | | | | | 249,533 | | |
Inventories: | | | | | | | | | | | | | |
Raw materials | | | | | 111,123 | | | | | | 79,330 | | |
Work in process | | | | | 41,882 | | | | | | 36,440 | | |
Finished goods | | | | | 103,220 | | | | | | 80,721 | | |
Total inventory | | | | | 256,225 | | | | | | 196,491 | | |
Prepaid expenses and other current assets | | | | | 25,964 | | | | | | 45,900 | | |
Total current assets | | | | | 675,905 | | | | | | 563,340 | | |
Property and Equipment: | | | | | | | | | | | | | |
Land | | | | | 7,007 | | | | | | 8,229 | | |
Buildings and improvements | | | | | 71,859 | | | | | | 68,005 | | |
Machinery and equipment | | | | | 231,808 | | | | | | 450,554 | | |
Total property and equipment | | | | | 310,674 | | | | | | 526,788 | | |
Less accumulated depreciation | | | | | (6,985) | | | | | | (352,256) | | |
Total property and equipment, net | | | | | 303,689 | | | | | | 174,532 | | |
Other Assets: | | | | | | | | | | | | | |
Intangible assets, net | | | | | 1,662,152 | | | | | | 83,675 | | |
Goodwill | | | | | 1,232,392 | | | | | | 480,563 | | |
Deferred income taxes | | | | | — | | | | | | 10,523 | | |
Other | | | | | 12,108 | | | | | | 6,934 | | |
Total other assets | | | | | 2,906,652 | | | | | | 581,695 | | |
| | | | $ | 3,886,246 | | | | | $ | 1,319,567 | | |
LIABILITIES AND STOCKHOLDERS’ EQUITY | | | | | | | | | | | | | |
Current Liabilities: | | | | | | | | | | | | | |
Accounts payable | | | | $ | 113,793 | | | | | $ | 85,720 | | |
Accrued expenses | | | | | 237,640 | | | | | | 185,857 | | |
Current portion of payable to related parties pursuant to tax receivable agreement | | | | | 24,894 | | | | | | 51,356 | | |
Current portion of long-term debt | | | | | 17,550 | | | | | | 4,300 | | |
Total current liabilities | | | | | 393,877 | | | | | | 327,233 | | |
Deferred income taxes | | | | | 332,513 | | | | | | 1,530 | | |
Long-term portion of payable to related parties pursuant to tax receivable agreement | | | | | 23,362 | | | | | | 18,125 | | |
Other long-term liabilities | | | | | 91,076 | | | | | | 83,424 | | |
Long-term debt | | | | | 2,434,598 | | | | | | 807,334 | | |
Commitments and contingencies | | | | | | | | | | | | | |
Stockholders’ Equity: | | | | | | | | | | | | | |
Preferred stock $0.01 par, 50,000,000 shares authorized, none issued and outstanding at December 31, 2017 (Predecessor) | | | | | — | | | | | | — | | |
Common stock $0.01 par, 6,379,748 issued and outstanding at June 30, 2018 (Successor) and common stock $0.01 par, 250,000,000 shares authorized 68,515,697 issued and outstanding at December 31, 2017 (Predecessor) | | | | | 64 | | | | | | 685 | | |
Additional paid-in-capital | | | | | 637,911 | | | | | | 756,096 | | |
Accumulated deficit | | | | | (20,411) | | | | | | (645,090) | | |
Accumulated other comprehensive loss | | | | | (6,744) | | | | | | (29,770) | | |
Total stockholders’ equity | | | | | 610,820 | | | | | | 81,921 | | |
| | | | $ | 3,886,246 | | | | | $ | 1,319,567 | | |
|
(Amounts in thousands) | | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | Six months ended July 1, 2017 | | |||||||||||
Cash flows from operating activities: | | | | | | | | | | | | | | | | | | | | |
Net income (loss) | | | | $ | (20,411) | | | | | | $ | (66,780) | | | | | $ | 26,222 | | |
Adjustments to reconcile net income (loss) to cash used in operating activities: | | | | | | | | | | | | | | | | | | | | |
Depreciation and amortization expense | | | | | 31,081 | | | | | | | 15,274 | | | | | | 26,555 | | |
Fair-value premium on purchased inventory | | | | | 35,443 | | | | | | | — | | | | | | — | | |
Non-cash acquisition costs | | | | | — | | | | | | | 37,922 | | | | | | — | | |
Non-cash restructuring costs | | | | | 1,121 | | | | | | | 127 | | | | | | 1,064 | | |
Non-cash interest expense, net | | | | | 8,004 | | | | | | | 3,748 | | | | | | 6,997 | | |
(Gain) loss on foreign currency transactions | | | | | 1,516 | | | | | | | 132 | | | | | | (772) | | |
Stock based compensation | | | | | — | | | | | | | 239 | | | | | | 422 | | |
Deferred income taxes | | | | | (22,944) | | | | | | | (108) | | | | | | 15,508 | | |
Tax receivable agreement liability adjustment | | | | | — | | | | | | | 5,237 | | | | | | — | | |
Increase (reduction) in tax uncertainty | | | | | 2 | | | | | | | 93 | | | | | | (65) | | |
Gain on sale of building | | | | | — | | | | | | | — | | | | | | (1,880) | | |
Other | | | | | 22 | | | | | | | (2) | | | | | | (54) | | |
Changes in operating assets and liabilities: | | | | | | | | | | | | | | | | | | | | |
Accounts receivable, net | | | | | (69,797) | | | | | | | 5,251 | | | | | | (85,918) | | |
Inventories | | | | | (3,326) | | | | | | | (38,638) | | | | | | (32,870) | | |
Prepaid expenses and other assets | | | | | 15,341 | | | | | | | 27,760 | | | | | | (1,858) | | |
Accounts payable | | | | | (6,188) | | | | | | | 14,253 | | | | | | 27,227 | | |
Accrued expenses | | | | | 49,619 | | | | | | | (7,372) | | | | | | (6,909) | | |
Cash payments on restructuring liabilities | | | | | (339) | | | | | | | (218) | | | | | | (257) | | |
Securities litigation settlement payment | | | | | — | | | | | | | (9,299) | | | | | | — | | |
Cash payments on acquisition related expenses | | | | | (52,673) | | | | | | | (20,343) | | | | | | — | | |
Other | | | | | (1,614) | | | | | | | (630) | | | | | | (311) | | |
Net cash used in operating activities | | | | | (35,143) | | | | | | | (33,354) | | | | | | (26,899) | | |
Cash flows from investing activities: | | | | | | | | | | | | | | | | | | | | |
Acquisitions, net of cash acquired | | | | | (2,754,799) | | | | | | | — | | | | | | — | | |
Capital expenditures | | | | | (10,008) | | | | | | | (11,288) | | | | | | (17,895) | | |
Proceeds from sale of assets | | | | | — | | | | | | | 11 | | | | | | 2,424 | | |
Net cash used in investing activities | | | | | (2,764,807) | | | | | | | (11,277) | | | | | | (15,471) | | |
Cash flows from financing activities: | | | | | | | | | | | | | | | | | | | | |
Proceeds from long-term debt | | | | | 2,376,712 | | | | | | | — | | | | | | — | | |
Net revolver borrowings | | | | | 130,000 | | | | | | | 40,000 | | | | | | — | | |
Payments on long-term debt | | | | | — | | | | | | | (1,075) | | | | | | (2,150) | | |
Cash payments on tax receivable agreement | | | | | — | | | | | | | (26,462) | | | | | | — | | |
Proceeds from equity contribution | | | | | 425,203 | | | | | | | — | | | | | | — | | |
Payments to tax authority for employee stock based compensation | | | | | — | | | | | | | — | | | | | | (1,186) | | |
Proceeds from exercises of employee stock options | | | | | — | | | | | | | 2,862 | | | | | | 745 | | |
Cash payments on appraisal shares liability | | | | | (19,537) | | | | | | | — | | | | | | — | | |
Debt issuance costs paid | | | | | (56,892) | | | | | | | — | | | | | | — | | |
Net cash provided by (used in) financing activities | | | | | 2,855,486 | | | | | | | 15,325 | | | | | | (2,591) | | |
Impact of exchange rate movements on cash | | | | | (1,927) | | | | | | | (55) | | | | | | 536 | | |
Net increase (decrease) in cash and cash equivalents | | | | | 53,609 | | | | | | | (29,361) | | | | | | (44,425) | | |
Cash and cash equivalents at the beginning of the period | | | | | — | | | | | | | 71,416 | | | | | | 51,597 | | |
Cash and cash equivalents at the end of the period | | | | $ | 53,609 | | | | | | $ | 42,055 | | | | | $ | 7,172 | | |
| | | | | | | | | | | |
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
(Amounts in thousands) | | | April 13, 2018 – June 30, 2018 | | | | April 1, 2018 – April 12, 2018 | | | Three months ended July 1, 2017 | | |||||||||
| | | (unaudited) | | | | (unaudited) | | | (unaudited) | | |||||||||
Net sales | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | $ | 247,193 | | | | | | $ | 29,794 | | | | | $ | 263,593 | | |
Windows and Doors | | | | | 350,743 | | | | | | | 39,945 | | | | | | 281,174 | | |
Operating earnings (loss) | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | | 6,815 | | | | | | | 2,175 | | | | | | 47,580 | | |
Windows and Doors | | | | | 24,704 | | | | | | | 2,417 | | | | | | 24,725 | | |
Unallocated | | | | | (18,079) | | | | | | | (68,915) | | | | | | (6,206) | | |
Foreign currency gain (loss) | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | | (386) | | | | | | | 148 | | | | | | 224 | | |
Windows and Doors | | | | | (1,130) | | | | | | | 461 | | | | | | 393 | | |
Interest income (expense), net | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | | 5 | | | | | | | 2 | | | | | | 5 | | |
Windows and Doors | | | | | (39) | | | | | | | — | | | | | | 4 | | |
Unallocated | | | | | (43,729) | ��� | | | | | | (2,599) | | | | | | (17,389) | | |
Income tax benefit (expense) | | | | | | | | | | | | | | | | | | | | |
Unallocated | | | | | 11,428 | | | | | | | 9,331 | | | | | | (19,477) | | |
Tax Receivable Agreement liability adjustment | | | | | | | | | | | | | | | | | | | | |
Unallocated | | | | | — | | | | | | | (5,237) | | | | | | — | | |
Net income (loss) | | | | $ | (20,411) | | | | | | $ | (62,217) | | | | | $ | 29,859 | | |
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
(Amounts in thousands) | | | April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | Six months ended July 1, 2017 | | |||||||||
| | | (unaudited) | | | | (unaudited) | | | (unaudited) | | |||||||||
Net sales | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | $ | 247,193 | | | | | | $ | 225,940 | | | | | $ | 454,430 | | |
Windows and Doors | | | | | 350,743 | | | | | | | 303,703 | | | | | | 520,352 | | |
Operating earnings (loss) | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | | 6,815 | | | | | | | 15,974 | | | | | | 67,403 | | |
Windows and Doors | | | | | 24,704 | | | | | | | 7,625 | | | | | | 26,154 | | |
Unallocated | | | | | (18,079) | | | | | | | (75,901) | | | | | | (15,632) | | |
Foreign currency gain (loss) | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | | (386) | | | | | | | (103) | | | | | | 243 | | |
Windows and Doors | | | | | (1,130) | | | | | | | (29) | | | | | | 529 | | |
Interest income (expense), net | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | | 5 | | | | | | | 1 | | | | | | 13 | | |
Windows and Doors | | | | | (39) | | | | | | | 13 | | | | | | 8 | | |
Unallocated | | | | | (43,729) | | | | | | | (19,046) | | | | | | (34,273) | | |
Income tax benefit (expense) | | | | | | | | | | | | | | | | | | | | |
Unallocated | | | | | 11,428 | | | | | | | 9,923 | | | | | | (18,223) | | |
Tax Receivable Agreement liability adjustment | | | | | | | | | | | | | | | | | | | | |
Unallocated | | | | | — | | | | | | | (5,237) | | | | | | — | | |
Net income (loss) | | | | $ | (20,411) | | | | | | $ | (66,780) | | | | | $ | 26,222 | | |
| | | For the three months ended | | |||||||||
(Amounts in thousands) | | | June 30, 2018 | | | July 1, 2017 | | ||||||
Net income (loss) | | | | $ | (82,628) | | | | | $ | 29,859 | | |
Interest expense, net | | | | | 46,360 | | | | | | 17,380 | | |
Provision (benefit) for income taxes | | | | | (20,759) | | | | | | 19,477 | | |
Depreciation and amortization | | | | | 32,919 | | | | | | 13,102 | | |
EBITDA | | | | | (24,108) | | | | | | 79,818 | | |
Non cash loss (gain) on foreign currency transactions | | | | | 907 | | | | | | (617) | | |
Acquisition costs | | | | | 78,988 | | | | | | — | | |
Customer inventory buybacks | | | | | 406 | | | | | | 632 | | |
Restructuring/integration expense | | | | | 1,331 | | | | | | 455 | | |
Non cash charge of purchase price allocated to inventories | | | | | 35,443 | | | | | | — | | |
Public company costs | | | | | — | | | | | | 337 | | |
Retention expense | | | | | 89 | | | | | | 361 | | |
Long term incentive plan compensation | | | | | 229 | | | | | | 1,238 | | |
Stock option expense | | | | | — | | | | | | 92 | | |
Litigation – class action charges, net | | | | | — | | | | | | 825 | | |
Tax receivable agreement liability adjustment | | | | | 5,237 | | | | | | — | | |
Adjusted EBITDA | | | | $ | 98,522 | | | | | $ | 83,141 | | |
|
| | | For the six months ended | | |||||||||
(Amounts in thousands) | | | June 30, 2018 | | | July 1, 2017 | | ||||||
Net income (loss) | | | | $ | (87,191) | | | | | $ | 26,222 | | |
Interest expense, net | | | | | 62,795 | | | | | | 34,252 | | |
Provision (benefit) for income taxes | | | | | (21,351) | | | | | | 18,223 | | |
Depreciation and amortization | | | | | 46,354 | | | | | | 26,555 | | |
EBITDA | | | | | 607 | | | | | | 105,252 | | |
Non cash loss (gain) on foreign currency transactions | | | | | 1,648 | | | | | | (772) | | |
Acquisition costs | | | | | 78,988 | | | | | | — | | |
Customer inventory buybacks | | | | | 1,858 | | | | | | 1,198 | | |
Restructuring/integration expense | | | | | 1,549 | | | | | | 1,412 | | |
Non cash charge of purchase price allocated to inventories | | | | | 35,443 | | | | | | — | | |
Public company costs | | | | | 500 | | | | | | 774 | | |
Retention expense | | | | | 192 | | | | | | 722 | | |
Long term incentive plan compensation | | | | | 985 | | | | | | 2,672 | | |
Stock option expense | | | | | 36 | | | | | | 263 | | |
Litigation – class action charges, net | | | | | — | | | | | | 1,113 | | |
Tax receivable agreement liability adjustment | | | | | 5,237 | | | | | | — | | |
Adjusted EBITDA | | | | $ | 127,043 | | | | | $ | 112,634 | | |
|
| | | For the three months ended | | |||||||||||||||||||||
(Amounts in thousands) | | | June 30, 2018 | | | July 1, 2017 | | ||||||||||||||||||
| | | (unaudited) | | | (unaudited) | | ||||||||||||||||||
Statement of operations data: | | | | | | | | | | | | | | | | | | | | | | | | | |
Net sales | | | | $ | 276,987 | | | | | | 100.0% | | | | | $ | 263,593 | | | | | | 100.0% | | |
Gross profit | | | | | 44,579 | | | | | | 16.1% | | | | | | 73,032 | | | | | | 27.7% | | |
SG&A expense (including acquisition costs) | | | | | 23,209 | | | | | | 8.4% | | | | | | 23,270 | | | | | | 8.8% | | |
Amortization of intangible assets | | | | | 12,380 | | | | | | 4.5% | | | | | | 2,182 | | | | | | 0.8% | | |
Operating earnings | | | | | 8,990 | | | | | | 3.2% | | | | | | 47,580 | | | | | | 18.1% | | |
Currency transaction gain (loss) | | | | | (238) | | | | | | (0.1)% | | | | | | 224 | | | | | | 0.1% | | |
| | | For the six months ended | | |||||||||||||||||||||
(Amounts in thousands) | | | June 30, 2018 | | | July 1, 2017 | | ||||||||||||||||||
| | | (unaudited) | | | (unaudited) | | ||||||||||||||||||
Statement of operations data: | | | | | | | | | | | | | | | | | | | | | | | | | |
Net sales | | | | $ | 473,133 | | | | | | 100.0% | | | | | $ | 454,430 | | | | | | 100.0% | | |
Gross profit | | | | | 85,269 | | | | | | 18.0% | | | | | | 118,995 | | | | | | 26.2% | | |
SG&A expense (including acquisition costs) | | | | | 47,825 | | | | | | 10.1% | | | | | | 47,146 | | | | | | 10.4% | | |
Amortization of intangible assets | | | | | 14,732 | | | | | | 3.1% | | | | | | 4,446 | | | | | | 1.0% | | |
Operating earnings | | | | | 22,789 | | | | | | 4.8% | | | | | | 67,403 | | | | | | 14.8% | | |
Currency transaction gain (loss) | | | | | (489) | | | | | | (0.1)% | | | | | | 243 | | | | | | 0.1% | | |
| | | For the three months ended | | |||||||||||||||||||||
(Amounts in thousands) | | | June 30, 2018 | | | July 1, 2017 | | ||||||||||||||||||
| | | (unaudited) | | | (unaudited) | | ||||||||||||||||||
Statement of operations data: | | | | | | | | | | | | | | | | | | | | | | | | | |
Net sales | | | | $ | 390,688 | | | | | | 100.0% | | | | | $ | 281,174 | | | | | | 100.0% | | |
Gross profit | | | | | 88,874 | | | | | | 22.7% | | | | | | 63,856 | | | | | | 22.7% | | |
SG&A expense (including acquisition costs) | | | | | 49,286 | | | | | | 12.6% | | | | | | 36,055 | | | | | | 12.8% | | |
Amortization of intangible assets | | | | | 12,467 | | | | | | 3.2% | | | | | | 3,076 | | | | | | 1.1% | | |
Operating earnings | | | | | 27,121 | | | | | | 6.9% | | | | | | 24,725 | | | | | | 8.8% | | |
Currency transaction gain (loss) | | | | | (669) | | | | | | (0.2)% | | | | | | 393 | | | | | | 0.1% | | |
| | | For the six months ended | | |||||||||||||||||||||
(Amounts in thousands) | | | June 30, 2018 | | | July 1, 2017 | | ||||||||||||||||||
| | | (unaudited) | | | (unaudited) | | ||||||||||||||||||
Statement of operations data: | | | | | | | | | | | | | | | | | | | | | | | | | |
Net sales | | | | $ | 654,446 | | | | | | 100.0% | | | | | $ | 520,352 | | | | | | 100.0% | | |
Gross profit | | | | | 136,234 | | | | | | 20.8% | | | | | | 107,418 | | | | | | 20.6% | | |
SG&A expense (including acquisition costs) | | | | | 88,359 | | | | | | 13.5% | | | | | | 75,108 | | | | | | 14.4% | | |
Amortization of intangible assets | | | | | 15,469 | | | | | | 2.4% | | | | | | 6,156 | | | | | | 1.2% | | |
Operating earnings | | | | | 32,406 | | | | | | 5.0% | | | | | | 26,154 | | | | | | 5.0% | | |
Currency transaction gain (loss) | | | | | (1,159) | | | | | | (0.2)% | | | | | | 529 | | | | | | 0.1% | | |
| | | For the three months ended | | |||||||||
(Amounts in thousands) | | | June 30, 2018 | | | July 1, 2017 | | ||||||
| | | (unaudited) | | | (unaudited) | | ||||||
Statement of operations data: | | | | | | | | | | | | | |
SG&A expense | | | | $ | (9,706) | | | | | $ | (6,206) | | |
Acquisition related expenses | | | | | (77,288) | | | | | | — | | |
Operating loss | | | | | (86,994) | | | | | | (6,206) | | |
Interest expense | | | | | (46,335) | | | | | | (17,399) | | |
Interest income | | | | | 7 | | | | | | 10 | | |
Tax Receivable Agreement liability adjustment | | | | | (5,237) | | | | | | — | | |
Income tax benefit (provision) for income taxes | | | | $ | 20,759 | | | | | $ | (19,477) | | |
| | | For the six months ended | | |||||||||
(Amounts in thousands) | | | June 30, 2018 | | | July 1, 2017 | | ||||||
| | | (unaudited) | | | (unaudited) | | ||||||
Statement of operations data: | | | | | | | | | | | | | |
SG&A expense | | | | $ | (16,692) | | | | | $ | (15,632) | | |
Acquisition related expenses | | | | | (77,288) | | | | | | — | | |
Operating loss | | | | | (93,980) | | | | | | (15,632) | | |
Interest expense | | | | | (62,790) | | | | | | (34,285) | | |
Interest income | | | | | 15 | | | | | | 12 | | |
Tax receivable agreement liability adjustment | | | | | (5,237) | | | | | | — | | |
Income tax benefit (provision) for income taxes | | | | $ | 21,351 | | | | | $ | (18,223) | | |
Siding, Fencing, and Stone Net Sales Disaggregation | | | For the three months ended | | |||||||||
| June 30, 2018 | | | July 1, 2017 | | ||||||||
Vinyl siding | | | | $ | 145,014 | | | | | $ | 146,612 | | |
Metal | | | | | 76,846 | | | | | | 67,275 | | |
Injection molded | | | | | 22,049 | | | | | | 20,506 | | |
Stone | | | | | 3,664 | | | | | | 4,519 | | |
Other products | | | | | 29,414 | | | | | | 24,681 | | |
Total | | | | $ | 276,987 | | | | | $ | 263,593 | | |
|
Siding, Fencing, and Stone Net Sales Disaggregation | | | For the six months ended | | |||||||||
| June 30, 2018 | | | July 1, 2017 | | ||||||||
Vinyl siding | | | | $ | 250,495 | | | | | $ | 250,016 | | |
Metal | | | | | 126,439 | | | | | | 117,910 | | |
Injection molded | | | | | 34,540 | | | | | | 35,086 | | |
Stone | | | | | 12,636 | | | | | | 13,011 | | |
Other products | | | | | 49,022 | | | | | | 38,407 | | |
Total | | | | $ | 473,132 | | | | | $ | 454,430 | | |
|
Windows and Doors Net Sales Disaggregation | | | For the three months ended | | | For the three months ended | | ||||||||||||||||||
| June 30, 2018 | | | July 1, 2017 | | ||||||||||||||||||||
| New Construction | | | Repair & Remodel | | | New Construction | | | Repair & Remodel | | ||||||||||||||
Vinyl | | | | $ | 234,193 | | | | | $ | 139,254 | | | | | $ | 176,919 | | | | | $ | 83,700 | | |
Aluminum | | | | | 6,439 | | | | | | 40 | | | | | | 10,484 | | | | | | — | | |
Other | | | | | 9,403 | | | | | | 1,359 | | | | | | 10,023 | | | | | | 48 | | |
Total | | | | $ | 250,035 | | | | | $ | 140,653 | | | | | $ | 197,426 | | | | | $ | 83,748 | | |
|
Windows and Doors Net Sales Disaggregation | | | For the six months ended | | | For the six months ended | | ||||||||||||||||||
| June 30, 2018 | | | July 1, 2017 | | ||||||||||||||||||||
| New Construction | | | Repair & Remodel | | | New Construction | | | Repair & Remodel | | ||||||||||||||
Vinyl | | | | $ | 402,470 | | | | | $ | 207,269 | | | | | $ | 332,273 | | | | | $ | 146,618 | | |
Aluminum | | | | | 24,393 | | | | | | 40 | | | | | | 19,826 | | | | | | — | | |
Other | | | | | 18,861 | | | | | | 1,414 | | | | | | 21,564 | | | | | | 71 | | |
Total | | | | $ | 445,724 | | | | | $ | 208,723 | | | | | $ | 373,663 | | | | | $ | 146,689 | | |
|
| Buildings and improvements | | | 8 – 25 years | |
| Machinery and equipment, including leases | | | 5 – 8 years | |
| Leasehold improvements | | | Term of lease or useful life, whichever is shorter | |
(Amounts in thousands) | | | June 30, 2018 | | | December 31, 2017 | | ||||||
Foreign currency hedge included in other current assets | | | | $ | 988 | | | | | $ | 6 | | |
(Amounts in thousands) Description | | | Carrying Value | | | Fair Value Total | | | Quoted Prices in Active Markets for Identical Assets (Level 1) | | | Significant Other Observable Inputs (Level 2) | | | Significant Unobservable Inputs (Level 3) | | |||||||||||||||
Liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Senior Notes – 8.00% | | | | $ | 645,000 | | | | | $ | 665,963 | | | | | $ | 665,963 | | | | | $ | — | | | | | $ | — | | |
Term Loan Facility | | | | | 1,755,000 | | | | | | 1,749,524 | | | | | | — | | | | | | 1,749,524 | | | | | | — | | |
As of June 30, 2018 | | | | $ | 2,400,000 | | | | | $ | 2,415,487 | | | | | $ | 665,963 | | | | | $ | 1,749,524 | | | | | $ | — | | |
Liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Senior Notes – 6.50% | | | | $ | 650,000 | | | | | $ | 671,970 | | | | | $ | 671,970 | | | | | $ | — | | | | | $ | — | | |
Term Loan Facility | | | | | 213,875 | | | | | | 215,479 | | | | | | — | | | | | | 215,479 | | | | | | — | | |
As of December 31, 2017 | | | | $ | 863,875 | | | | | $ | 887,449 | | | | | $ | 671,970 | | | | | $ | 215,479 | | | | | $ | — | | |
|
(Amounts in thousands) | | | | | | | |
Assets acquired: | | | | | | | |
Accounts receivable | | | | $ | 270,758 | | |
Inventories | | | | | 288,518 | | |
Prepaid expenses and other current assets | | | | | 32,966 | | |
Property and equipment | | | | | 301,963 | | |
Intangible assets (tradenames/customer relationships) | | | | | 1,689,600 | | |
Goodwill | | | | | 1,235,096 | | |
Other assets | | | | | 12,923 | | |
Total assets acquired | | | | | 3,831,824 | | |
Liabilities assumed: | | | | | | | |
Accounts payable(1) | | | | | 119,882 | | |
Tax receivable agreement liability | | | | | 48,256 | | |
Other liabilities | | | | | 146,354 | | |
Accrued long-term warranty | | | | | 67,364 | | |
Deferred income taxes | | | | | 358,658 | | |
Other long-term liabilities | | | | | 26,997 | | |
Total liabilities assumed | | | | | 767,511 | | |
Net assets acquired | | | | $ | 3,064,313 | | |
|
| Professional fees | | | | $ | 32,059 | | |
| Long-term incentive plan liability acceleration based on change of control | | | | | 29,626 | | |
| Transaction bonuses | | | | | 8,900 | | |
| Other | | | | | 8,403 | | |
| | | | | $ | 78,988 | | |
|
| | | Successor | | | Predecessor | | ||||||
(Amounts in thousands) | | | June 30, 2018 | | | December 31, 2017 | | ||||||
Siding, Fencing and Stone | | | | $ | 713,649 | | | | | $ | 349,954 | | |
Windows and Doors | | | | | 518,743 | | | | | | 130,609 | | |
| | | | $ | 1,232,392 | | | | | $ | 480,563 | | |
|
(Amounts in thousands) | | | Windows and Doors | | | Siding, Fencing and Stone | | ||||||
Balance as of December 31, 2017 | | | | | | | | | | | | | |
Goodwill | | | | $ | 458,382 | | | | | $ | 472,181 | | |
Accumulated impairment losses | | | | | (327,773) | | | | | | (122,227) | | |
| | | | $ | 130,609 | | | | | $ | 349,954 | | |
Currency translation adjustments | | | | | (267) | | | | | | (577) | | |
Balance as of April 12, 2018 | | | | | | | | | | | | | |
Goodwill | | | | | 458,115 | | | | | | 471,604 | | |
Accumulated impairment losses | | | | | (327,773) | | | | | | (122,227) | | |
| | | | $ | 130,342 | | | | | $ | 349,377 | | |
Elimination of Predecessor goodwill | | | | | (130,342) | | | | | | (349,377) | | |
Goodwill recognized from Merger | | | | | 520,365 | | | | | | 714,731 | | |
Currency translation adjustments | | | | | (1,622) | | | | | | (1,082) | | |
Balance as of June 30, 2018 | | | | | | | | | | | | | |
Goodwill | | | | $ | 518,743 | | | | | $ | 713,649 | | |
|
(Amounts in thousands) | | | Average Amortization Period (in Years) | | | Cost | | | Accumulated Amortization | | | Net Carrying Value | | ||||||||||||
As of June 30, 2018 | | | | | | | | | | | | | | | | | | | | | | | | | |
Trademarks/Tradenames | | | | | 15 | | | | | $ | 182,700 | | | | | $ | (2,636) | | | | | $ | 180,064 | | |
Customer relationships | | | | | 15 | | | | | | 1,503,548 | | | | | | (21,460) | | | | | | 1,482,088 | | |
Total intangible assets | | | | | 15 | | | | | $ | 1,686,248 | | | | | $ | (24,096) | | | | | $ | 1,662,152 | | |
As of December 31, 2017 | | | | | | | | | | | | | | | | | | | | | | | | | |
Patents | | | | | 14 | | | | | $ | 12,770 | | | | | $ | (12,261) | | | | | $ | 509 | | |
Trademarks/Tradenames | | | | | 12 | | | | | | 117,473 | | | | | | (88,853) | | | | | | 28,620 | | |
Customer relationships | | | | | 13 | | | | | | 219,614 | | | | | | (166,086) | | | | | | 53,528 | | |
Other | | | | | 4 | | | | | | 5,750 | | | | | | (4,732) | | | | | | 1,018 | | |
Total intangible assets | | | | | 12 | | | | | $ | 355,607 | | | | | $ | (271,932) | | | | | $ | 83,675 | | |
|
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
(Amounts in thousands) | | | April 13, 2018 – June 30, 2018 | | | | April 1, 2018 – April 12, 2018 | | | Three months ended July 1, 2017 | | |||||||||
Amortization expense | | | | $ | 24,096 | | | | | | $ | 751 | | | | | $ | 5,258 | | |
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
(Amounts in thousands) | | | April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | Six months ended July 1, 2017 | | |||||||||
Amortization expense | | | | $ | 24,096 | | | | | | $ | 6,105 | | | | | $ | 10,602 | | |
(Amounts in thousands) | | | Amortization expense | | |||
2018 (remainder of year) | | | | $ | 57,067 | | |
2019 | | | | | 112,640 | | |
2020 | | | | | 112,640 | | |
2021 | | | | | 112,640 | | |
2022 | | | | | 112,640 | | |
(Amounts in thousands) | | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| April 13, 2018 – June 30, 2018 | | | | April 1, 2018 – April 12, 2018 | | | Three months ended July 1, 2017 | | |||||||||||
Net income (loss) | | | | $ | (20,411) | | | | | | $ | (62,217) | | | | | $ | 29,859 | | |
Foreign currency translation adjustment | | | | | (7,486) | | | | | | | 1,204 | | | | | | 1,279 | | |
Unrealized gain (loss) on derivative instruments | | | | | 742 | | | | | | | (610) | | | | | | (430) | | |
Comprehensive income (loss) | | | | $ | (27,155) | | | | | | $ | (61,623) | | | | | $ | 30,708 | | |
| | | | | | | | | | | |
(Amounts in thousands) | | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | Six months ended July 1, 2017 | | |||||||||||
Net income (loss) | | | | $ | (20,411) | | | | | | $ | (66,780) | | | | | $ | 26,222 | | |
Foreign currency translation adjustment | | | | | (7,486) | | | | | | | (643) | | | | | | 1,844 | | |
Unrealized gain (loss) on derivative instruments | | | | | 742 | | | | | | | 317 | | | | | | (976) | | |
Comprehensive income (loss) | | | | $ | (27,155) | | | | | | $ | (67,106) | | | | | $ | 27,090 | | |
| | | | | | | | | | | |
| | | Successor | | | Predecessor | | ||||||
(Amounts in thousands) | | | June 30, 2018 | | | December 31, 2017 | | ||||||
Senior secured asset based revolving credit facility | | | | $ | 130,000 | | | | | $ | — | | |
Term Loan Facility due 2021, net of unamortized early tender premium, discount, and debt issuance costs of $0 and $10,560, respectively | | | | | — | | | | | | 203,315 | | |
Cash Flow Revolver | | | | | — | | | | | | — | | |
6.50% Senior Notes due 2022, net of unamortized early tender premium, discount, and debt issuance costs of $0 and $41,681, respectively | | | | | — | | | | | | 608,319 | | |
Term Loan Facility due 2025, net of unamortized discount, and debt issuance costs of $51,144 and $0, respectively | | | | | 1,703,856 | | | | | | — | | |
8.00% Senior Notes due 2026, net of unamortized discount, and debt issuance costs of $26,708 and $0, respectively | | | | | 618,292 | | | | | | — | | |
| | | | $ | 2,452,148 | | | | | $ | 811,634 | | |
Less current portion of long-term debt | | | | | (17,550) | | | | | | (4,300) | | |
| | | | $ | 2,434,598 | | | | | $ | 807,334 | | |
|
| | | Rate | | |||
Interest rate | | | | | 6.09% | | |
Effective interest rate | | | | | 7.95% | | |
(in thousands) | | | June 30, 2018 | | |||
Excess availability | | | | $ | 183,812 | | |
Revolving loans outstanding | | | | | 130,000 | | |
Letters of credit outstanding | | | | | 14,341 | | |
(Amounts in thousands) | | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| April 13, 2018 – June 30, 2018 | | | | April 1, 2018 – April 12, 2018 | | | Three months ended July 1, 2017 | | |||||||||||
Service cost | | | | $ | — | | | | | | $ | — | | | | | $ | — | | |
Interest cost | | | | | 360 | | | | | | | 55 | | | | | | 459 | | |
Expected return on plan assets | | | | | (514) | | | | | | | (79) | | | | | | (546) | | |
Amortization of loss | | | | | 306 | | | | | | | 47 | | | | | | 351 | | |
Net periodic benefit expense | | | | $ | 152 | | | | | | $ | 23 | | | | | $ | 264 | | |
| | | | | | | | | | | |
(Amounts in thousands) | | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | Six months ended July 1, 2017 | | |||||||||||
Service cost | | | | $ | — | | | | | | $ | — | | | | | $ | — | | |
Interest cost | | | | | 360 | | | | | | | 470 | | | | | | 917 | | |
Expected return on plan assets | | | | | (514) | | | | | | | (672) | | | | | | (1,093) | | |
Amortization of loss | | | | | 306 | | | | | | | 400 | | | | | | 702 | | |
Net periodic benefit expense | | | | $ | 152 | | | | | | $ | 198 | | | | | $ | 526 | | |
| | | | | | | | | | | |
(Amounts in thousands) | | | June 30, 2018 | | | December 31, 2017 | | ||||||
Product claim liabilities | | | | $ | 138 | | | | | $ | 138 | | |
Multi-employer pension plan withdrawal liability | | | | | 269 | | | | | | 449 | | |
Other | | | | | 241 | | | | | | 439 | | |
| | | | $ | 648 | | | | | $ | 1,026 | | |
|
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
(Amounts in thousands) | | | April 13, 2018 – June 30, 2018 | | | | April 1, 2018 – April 12, 2018 | | | Three months ended July 1, 2017 | | |||||||||
Balance, beginning of period | | | | $ | 78,184 | | | | | | $ | 76,999 | | | | | $ | 78,451 | | |
Acquisition – Atrium | | | | | 8,047 | | | | | | | — | | | | | | — | | |
Warranty expense during period | | | | | 5,895 | | | | | | | 1,961 | | | | | | 5,545 | | |
Settlements made during period | | | | | (6,005) | | | | | | | (776) | | | | | | (5,782) | | |
Balance, end of period | | | | $ | 86,121 | | | | | | $ | 78,184 | | | | | $ | 78,214 | | |
| | | | | | | | | | | |
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
(Amounts in thousands) | | | April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | Six months ended July 1, 2017 | | |||||||||
Balance, beginning of period | | | | $ | 78,184 | | | | | | $ | 77,317 | | | | | $ | 77,293 | | |
Acquisition – Atrium | | | | | 8,047 | | | | | | | — | | | | | | — | | |
Warranty expense during period | | | | | 5,895 | | | | | | | 7,226 | | | | | | 11,708 | | |
Settlements made during period | | | | | (6,005) | | | | | | | (6,359) | | | | | | (10,787) | | |
Balance, end of period | | | | $ | 86,121 | | | | | | $ | 78,184 | | | | | $ | 78,214 | | |
| | | | | | | | | | | |
| | | Successor | | | Predecessor | | ||||||
(Amounts in thousands) | | | June 30, 2018 | | | December 31, 2017 | | ||||||
Insurance | | | | $ | 9,489 | | | | | $ | 7,637 | | |
Employee compensation and benefits | | | | | 24,186 | | | | | | 19,720 | | |
Sales and marketing | | | | | 51,405 | | | | | | 58,131 | | |
Product warranty | | | | | 21,923 | | | | | | 19,652 | | |
Accrued freight | | | | | 4,000 | | | | | | 3,696 | | |
Accrued interest | | | | | 35,659 | | | | | | 18,027 | | |
Accrued pension | | | | | 1,358 | | | | | | 1,358 | | |
Accrued sales returns and discounts | | | | | 2,022 | | | | | | 1,303 | | |
Accrued taxes | | | | | 12,416 | | | | | | 4,735 | | |
Undistributed appraisal shares liability | | | | | 25,362 | | | | | | — | | |
Litigation accrual | | | | | 700 | | | | | | 26,849 | | |
Other | | | | | 49,120 | | | | | | 24,749 | | |
| | | | $ | 237,640 | | | | | $ | 185,857 | | |
|
| | | Successor | | | Predecessor | | ||||||
(Amounts in thousands) | | | June 30, 2018 | | | December 31, 2017 | | ||||||
Insurance | | | | $ | 3,750 | | | | | $ | 595 | | |
Pension liabilities | | | | | 12,677 | | | | | | 12,805 | | |
Multi-employer pension withdrawal liability | | | | | 269 | | | | | | 449 | | |
Product warranty | | | | | 64,198 | | | | | | 57,665 | | |
Long-term environmental liability | | | | | 1,069 | | | | | | 1,075 | | |
Liabilities for tax uncertainties | | | | | 4,717 | | | | | | 4,529 | | |
Litigation accrual | | | | | 644 | | | | | | 731 | | |
Other | | | | | 3,752 | | | | | | 5,575 | | |
| | | | $ | 91,076 | | | | | $ | 83,424 | | |
|
| | | Stock Options | | | Weighted- Average Exercise Price | | | Weighted- Average Remaining Contractual Term (Years) | | |||||||||
Balance at January 1, 2018 | | | | | 2,398,181 | | | | | $ | 14.02 | | | | | | 3.43 | | |
Granted | | | | | — | | | | | | — | | | | | | — | | |
Exercised | | | | | (231,878) | | | | | | 12.35 | | | | | | — | | |
Forfeited or expired | | | | | — | | | | | | — | | | | | | — | | |
April 12, 2018 | | | | | 2,166,303 | | | | | $ | 14.20 | | | | | | 3.34 | | |
|
(Amounts in thousands) | | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| April 13, 2018 – June 30, 2018 | | | | April 1, 2018 – April 12, 2018 | | | Three months ended July 1, 2017 | | |||||||||||
Net sales | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | $ | 247,193 | | | | | | $ | 29,794 | | | | | $ | 263,593 | | |
Windows and Doors | | | | | 350,743 | | | | | ��� | | 39,945 | | | | | | 281,174 | | |
| | | | $ | 597,936 | | | | | | $ | 69,739 | | | | | $ | 544,767 | | |
Operating earnings (loss) | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | $ | 6,815 | | | | | | $ | 2,175 | | | | | $ | 47,580 | | |
Windows and Doors | | | | | 24,704 | | | | | | | 2,417 | | | | | | 24,725 | | |
Unallocated | | | | | (18,079) | | | | | | | (68,915) | | | | | | (6,206) | | |
| | | | $ | 13,440 | | | | | | $ | (64,323) | | | | | $ | 66,099 | | |
| | | | | | | | | | | |
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| | | April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | Six months ended July 1, 2017 | | |||||||||
Net sales | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | $ | 247,193 | | | | | | $ | 225,940 | | | | | $ | 454,430 | | |
Windows and Doors | | | | | 350,743 | | | | | | | 303,703 | | | | | | 520,352 | | |
| | | | $ | 597,936 | | | | | | $ | 529,643 | | | | | $ | 974,782 | | |
Operating earnings (loss) | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | $ | 6,815 | | | | | | $ | 15,974 | | | | | $ | 67,403 | | |
Windows and Doors | | | | | 24,704 | | | | | | | 7,625 | | | | | | 26,154 | | |
Unallocated | | | | | (18,079) | | | | | | | (75,901) | | | | | | (15,632) | | |
| | | | $ | 13,440 | | | | | | $ | (52,302) | | | | | $ | 77,925 | | |
| | | | | | | | | | | |
| | | Total assets as of | | |||||||||
| | | Successor | | | Predecessor | | ||||||
| | | June 30, 2018 | | | December 31, 2017 | | ||||||
Total assets | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | $ | 1,949,149 | | | | | $ | 728,502 | | |
Windows and Doors | | | | | 1,880,625 | | | | | | 500,278 | | |
Unallocated | | | | | 56,472 | | | | | | 90,787 | | |
| | | | $ | 3,886,246 | | | | | $ | 1,319,567 | | |
|
(Amounts in thousands, except shares and per share data) | | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| April 13, 2018 – June 30, 2018 | | | | April 1, 2018 – April 12, 2018 | | | Three months ended July 1, 2017 | | |||||||||||
Net sales | | | | $ | 597,936 | | | | | | $ | 69,739 | | | | | $ | 544,767 | | |
Cost of products sold | | | | | 479,402 | | | | | | | 54,820 | | | | | | 407,879 | | |
Gross profit | | | | | 118,534 | | | | | | | 14,919 | | | | | | 136,888 | | |
Operating expenses: | | | | | | | | | | | | | | | | | | | | |
Selling, general and administrative expenses | | | | | 69,812 | | | | | | | 10,689 | | | | | | 65,531 | | |
Acquisition related expenses | | | | | 11,186 | | | | | | | 67,802 | | | | | | — | | |
Amortization of intangible assets | | | | | 24,096 | | | | | | | 751 | | | | | | 5,258 | | |
Total operating expenses | | | | | 105,094 | | | | | | | 79,242 | | | | | | 70,789 | | |
Operating earnings (loss) | | | | | 13,440 | | | | | | | (64,323) | | | | | | 66,099 | | |
Foreign currency gain (loss) | | | | | (1,516) | | | | | | | 609 | | | | | | 617 | | |
Interest expense | | | | | (43,787) | | | | | | | (2,599) | | | | | | (17,399) | | |
Interest income | | | | | 24 | | | | | | | 2 | | | | | | 19 | | |
Tax receivable agreement liability adjustment | | | | | — | | | | | | | (5,237) | | | | | | — | | |
Income (loss) before provision (benefit) for income taxes | | | | | (31,839) | | | | | | | (71,548) | | | | | | 49,336 | | |
Provision (benefit) for income taxes | | | | | (11,428) | | | | | | | (9,331) | | | | | | 19,477 | | |
Net income (loss) | | | | $ | (20,411) | | | | | | $ | (62,217) | | | | | $ | 29,859 | | |
Comprehensive income (loss) | | | | $ | (27,155) | | | | | | $ | (61,623) | | | | | $ | 30,708 | | |
Net income (loss) attributable to common shareholders per share: | | | | | | | | | | | | | | | | | | | | |
Basic | | | | $ | (3.20) | | | | | | $ | (0.91) | | | | | $ | 0.44 | | |
Diluted | | | | $ | (3.20) | | | | | | $ | (0.91) | | | | | $ | 0.43 | | |
Weighted average shares outstanding: | | | | | | | | | | | | | | | | | | | | |
Basic | | | | | 6,379,748 | | | | | | | 68,644,725 | | | | | | 68,435,315 | | |
Diluted | | | | | 6,379,748 | | | | | | | 68,644,725 | | | | | | 69,019,692 | | |
(Amounts in thousands, except shares and per share data) | | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | Six months ended July 1, 2017 | | |||||||||||
Net sales | | | | $ | 597,936 | | | | | | $ | 529,643 | | | | | $ | 974,782 | | |
Cost of products sold | | | | | 479,402 | | | | | | | 426,674 | | | | | | 748,369 | | |
Gross profit | | | | | 118,534 | | | | | | | 102,969 | | | | | | 226,413 | | |
Operating expenses: | | | | | | | | | | | | | | | | | | | | |
Selling, general and administrative expenses | | | | | 69,812 | | | | | | | 81,364 | | | | | | 137,886 | | |
Acquisition related expenses | | | | | 11,186 | | | | | | | 67,802 | | | | | | — | | |
Amortization of intangible assets | | | | | 24,096 | | | | | | | 6,105 | | | | | | 10,602 | | |
Total operating expenses | | | | | 105,094 | | | | | | | 155,271 | | | | | | 148,488 | | |
Operating earnings (loss) | | | | | 13,440 | | | | | | | (52,302) | | | | | | 77,925 | | |
Foreign currency gain (loss) | | | | | (1,516) | | | | | | | (132) | | | | | | 772 | | |
Interest expense | | | | | (43,787) | | | | | | | (19,054) | | | | | | (34,285) | | |
Interest income | | | | | 24 | | | | | | | 22 | | | | | | 33 | | |
Tax receivable agreement liability adjustment | | | | | — | | | | | | | (5,237) | | | | | | — | | |
Income (loss) before provision (benefit) for income taxes | | | | | (31,839) | | | | | | | (76,703) | | | | | | 44,445 | | |
Provision (benefit) for income taxes | | | | | (11,428) | | | | | | | (9,923) | | | | | | 18,223 | | |
Net income (loss) | | | | $ | (20,411) | | | | | | $ | (66,780) | | | | | $ | 26,222 | | |
Comprehensive income (loss) | | | | $ | (27,155) | | | | | | $ | (67,106) | | | | | $ | 27,090 | | |
Net income (loss) attributable to common shareholders per share: | | | | | | | | | | | | | | | | | | | | |
Basic | | | | $ | (3.20) | | | | | | $ | (0.97) | | | | | $ | 0.38 | | |
Diluted | | | | $ | (3.20) | | | | | | $ | (0.97) | | | | | $ | 0.38 | | |
Weighted average shares outstanding: | | | | | | | | | | | | | | | | | | | | |
Basic | | | | | 6,379,748 | | | | | | | 68,557,814 | | | | | | 68,417,602 | | |
Diluted | | | | | 6,379,748 | | | | | | | 68,557,814 | | | | | | 68,988,527 | | |
(Amounts in thousands, except share amounts) | | | Successor | | | Predecessor | | ||||||
| June 30, 2018 | | | December 31, 2017 | | ||||||||
ASSETS | | | | | | | | | | | | | |
Current Assets: | | | | | | | | | | | | | |
Cash and cash equivalents | | | | $ | 53,609 | | | | | $ | 71,416 | | |
Accounts receivable, less allowances of $4,287 and $3,137, respectively | | | | | 340,107 | | | | | | 249,533 | | |
Inventories: | | | | | | | | | | | | | |
Raw materials | | | | | 111,123 | | | | | | 79,330 | | |
Work in process | | | | | 41,882 | | | | | | 36,440 | | |
Finished goods | | | | | 103,220 | | | | | | 80,721 | | |
Total inventory | | | | | 256,225 | | | | | | 196,491 | | |
Prepaid expenses and other current assets | | | | | 25,964 | | | | | | 45,900 | | |
Total current assets | | | | | 675,905 | | | | | | 563,340 | | |
Property and Equipment: | | | | | | | | | | | | | |
Land | | | | | 7,007 | | | | | | 8,229 | | |
Buildings and improvements | | | | | 71,859 | | | | | | 68,005 | | |
Machinery and equipment | | | | | 231,808 | | | | | | 450,554 | | |
Total property and equipment | | | | | 310,674 | | | | | | 526,788 | | |
Less accumulated depreciation | | | | | (6,985) | | | | | | (352,256) | | |
Total property and equipment, net | | | | | 303,689 | | | | | | 174,532 | | |
Other Assets: | | | | | | | | | | | | | |
Intangible assets, net | | | | | 1,662,152 | | | | | | 83,675 | | |
Goodwill | | | | | 1,232,392 | | | | | | 480,563 | | |
Deferred income taxes | | | | | — | | | | | | 10,523 | | |
Other | | | | | 12,108 | | | | | | 6,934 | | |
Total other assets | | | | | 2,906,652 | | | | | | 581,695 | | |
| | | | $ | 3,886,246 | | | | | $ | 1,319,567 | | |
LIABILITIES AND STOCKHOLDERS’ EQUITY | | | | | | | | | | | | | |
Current Liabilities: | | | | | | | | | | | | | |
Accounts payable | | | | $ | 113,793 | | | | | $ | 85,720 | | |
Accrued expenses | | | | | 237,640 | | | | | | 185,857 | | |
Current portion of payable to related parties pursuant to tax receivable agreement | | | | | 24,894 | | | | | | 51,356 | | |
Current portion of long-term debt | | | | | 17,550 | | | | | | 4,300 | | |
Total current liabilities | | | | | 393,877 | | | | | | 327,233 | | |
Deferred income taxes | | | | | 332,513 | | | | | | 1,530 | | |
Long-term portion of payable to related parties pursuant to tax receivable agreement | | | | | 23,362 | | | | | | 18,125 | | |
Other long-term liabilities | | | | | 91,076 | | | | | | 83,424 | | |
Long-term debt | | | | | 2,434,598 | | | | | | 807,334 | | |
Commitments and contingencies | | | | | | | | | | | | | |
Stockholders’ Equity: | | | | | | | | | | | | | |
Preferred stock $0.01 par, 50,000,000 shares authorized, none issued and outstanding at December 31, 2017 (Predecessor) | | | | | — | | | | | | — | | |
Common stock $0.01 par, 6,379,748 issued and outstanding at June 30, 2018 (Successor) and common stock $0.01 par, 250,000,000 shares authorized 68,515,697 issued and outstanding at December 31, 2017 (Predecessor) | | | | | 64 | | | | | | 685 | | |
Additional paid-in-capital | | | | | 637,911 | | | | | | 756,096 | | |
Accumulated deficit | | | | | (20,411) | | | | | | (645,090) | | |
Accumulated other comprehensive loss | | | | | (6,744) | | | | | | (29,770) | | |
Total stockholders’ equity | | | | | 610,820 | | | | | | 81,921 | | |
| | | | $ | 3,886,246 | | | | | $ | 1,319,567 | | |
|
(Amounts in thousands) | | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | Six months ended July 1, 2017 | | |||||||||||
Cash flows from operating activities: | | | | | | | | | | | | | | | | | | | | |
Net income (loss) | | | | $ | (20,411) | | | | | | $ | (66,780) | | | | | $ | 26,222 | | |
Adjustments to reconcile net income (loss) to cash used in operating activities: | | | | | | | | | | | | | | | | | | | | |
Depreciation and amortization expense | | | | | 31,081 | | | | | | | 15,274 | | | | | | 26,555 | | |
Fair-value premium on purchased inventory | | | | | 35,443 | | | | | | | — | | | | | | — | | |
Non-cash acquisition costs | | | | | — | | | | | | | 37,922 | | | | | | — | | |
Non-cash restructuring costs | | | | | 1,121 | | | | | | | 127 | | | | | | 1,064 | | |
Non-cash interest expense, net | | | | | 8,004 | | | | | | | 3,748 | | | | | | 6,997 | | |
(Gain) loss on foreign currency transactions | | | | | 1,516 | | | | | | | 132 | | | | | | (772) | | |
Stock based compensation | | | | | — | | | | | | | 239 | | | | | | 422 | | |
Deferred income taxes | | | | | (22,944) | | | | | | | (108) | | | | | | 15,508 | | |
Tax receivable agreement liability adjustment | | | | | — | | | | | | | 5,237 | | | | | | — | | |
Increase (reduction) in tax uncertainty | | | | | 2 | | | | | | | 93 | | | | | | (65) | | |
Gain on sale of building | | | | | — | | | | | | | — | | | | | | (1,880) | | |
Other | | | | | 22 | | | | | | | (2) | | | | | | (54) | | |
Changes in operating assets and liabilities: | | | | | | | | | | | | | | | | | | | | |
Accounts receivable, net | | | | | (69,797) | | | | | | | 5,251 | | | | | | (85,918) | | |
Inventories | | | | | (3,326) | | | | | | | (38,638) | | | | | | (32,870) | | |
Prepaid expenses and other assets | | | | | 15,341 | | | | | | | 27,760 | | | | | | (1,858) | | |
Accounts payable | | | | | (6,188) | | | | | | | 14,253 | | | | | | 27,227 | | |
Accrued expenses | | | | | 49,619 | | | | | | | (7,372) | | | | | | (6,909) | | |
Cash payments on restructuring liabilities | | | | | (339) | | | | | | | (218) | | | | | | (257) | | |
Securities litigation settlement payment | | | | | — | | | | | | | (9,299) | | | | | | — | | |
Cash payments on acquisition related expenses | | | | | (52,673) | | | | | | | (20,343) | | | | | | — | | |
Other | | | | | (1,614) | | | | | | | (630) | | | | | | (311) | | |
Net cash used in operating activities | | | | | (35,143) | | | | | | | (33,354) | | | | | | (26,899) | | |
Cash flows from investing activities: | | | | | | | | | | | | | | | | | | | | |
Acquisitions, net of cash acquired | | | | | (2,754,799) | | | | | | | — | | | | | | — | | |
Capital expenditures | | | | | (10,008) | | | | | | | (11,288) | | | | | | (17,895) | | |
Proceeds from sale of assets | | | | | — | | | | | | | 11 | | | | | | 2,424 | | |
Net cash used in investing activities | | | | | (2,764,807) | | | | | | | (11,277) | | | | | | (15,471) | | |
Cash flows from financing activities: | | | | | | | | | | | | | | | | | | | | |
Proceeds from long-term debt | | | | | 2,376,712 | | | | | | | — | | | | | | — | | |
Net revolver borrowings | | | | | 130,000 | | | | | | | 40,000 | | | | | | — | | |
Payments on long-term debt | | | | | — | | | | | | | (1,075) | | | | | | (2,150) | | |
Cash payments on tax receivable agreement | | | | | — | | | | | | | (26,462) | | | | | | — | | |
Proceeds from equity contribution | | | | | 425,203 | | | | | | | — | | | | | | — | | |
Payments to tax authority for employee stock based compensation | | | | | — | | | | | | | — | | | | | | (1,186) | | |
Proceeds from exercises of employee stock options | | | | | — | | | | | | | 2,862 | | | | | | 745 | | |
Cash payments on appraisal shares liability | | | | | (19,537) | | | | | | | — | | | | | | — | | |
Debt issuance costs paid | | | | | (56,892) | | | | | | | — | | | | | | — | | |
Net cash provided by (used in) financing activities | | | | | 2,855,486 | | | | | | | 15,325 | | | | | | (2,591) | | |
Impact of exchange rate movements on cash | | | | | (1,927) | | | | | | | (55) | | | | | | 536 | | |
Net increase (decrease) in cash and cash equivalents | | | | | 53,609 | | | | | | | (29,361) | | | | | | (44,425) | | |
Cash and cash equivalents at the beginning of the period | | | | | — | | | | | | | 71,416 | | | | | | 51,597 | | |
Cash and cash equivalents at the end of the period | | | | $ | 53,609 | | | | | | $ | 42,055 | | | | | $ | 7,172 | | |
| | | | | | | | | | | |
Siding, Fencing, and Stone Net Sales Disaggregation | | | For the three months ended | | |||||||||
| June 30, 2018 | | | July 1, 2017 | | ||||||||
Vinyl siding | | | | $ | 145,014 | | | | | $ | 146,612 | | |
Metal | | | | | 76,846 | | | | | | 67,275 | | |
Injection molded | | | | | 22,049 | | | | | | 20,506 | | |
Stone | | | | | 3,664 | | | | | | 4,519 | | |
Other products | | | | | 29,414 | | | | | | 24,681 | | |
Total | | | | $ | 276,987 | | | | | $ | 263,593 | | |
|
Siding, Fencing, and Stone Net Sales Disaggregation | | | For the six months ended | | |||||||||
| June 30, 2018 | | | July 1, 2017 | | ||||||||
Vinyl siding | | | | $ | 250,495 | | | | | $ | 250,016 | | |
Metal | | | | | 126,439 | | | | | | 117,910 | | |
Injection molded | | | | | 34,540 | | | | | | 35,086 | | |
Stone | | | | | 12,636 | | | | | | 13,011 | | |
Other products | | | | | 49,022 | | | | | | 38,407 | | |
Total | | | | $ | 473,132 | | | | | $ | 454,430 | | |
|
Windows and Doors Net Sales Disaggregation | | | For the three months ended | | | For the three months ended | | ||||||||||||||||||
| June 30, 2018 | | | July 1, 2017 | | ||||||||||||||||||||
| New Construction | | | Repair & Remodel | | | New Construction | | | Repair & Remodel | | ||||||||||||||
Vinyl | | | | $ | 234,193 | | | | | $ | 139,254 | | | | | $ | 176,919 | | | | | $ | 83,700 | | |
Aluminum | | | | | 6,439 | | | | | | 40 | | | | | | 10,484 | | | | | | — | | |
Other | | | | | 9,403 | | | | | | 1,359 | | | | | | 10,023 | | | | | | 48 | | |
Total | | | | $ | 250,035 | | | | | $ | 140,653 | | | | | $ | 197,426 | | | | | $ | 83,748 | | |
|
Windows and Doors Net Sales Disaggregation | | | For the six months ended | | | For the six months ended | | ||||||||||||||||||
| June 30, 2018 | | | July 1, 2017 | | ||||||||||||||||||||
| New Construction | | | Repair & Remodel | | | New Construction | | | Repair & Remodel | | ||||||||||||||
Vinyl | | | | $ | 402,470 | | | | | $ | 207,269 | | | | | $ | 332,273 | | | | | $ | 146,618 | | |
Aluminum | | | | | 24,393 | | | | | | 40 | | | | | | 19,826 | | | | | | — | | |
Other | | | | | 18,861 | | | | | | 1,414 | | | | | | 21,564 | | | | | | 71 | | |
Total | | | | $ | 445,724 | | | | | $ | 208,723 | | | | | $ | 373,663 | | | | | $ | 146,689 | | |
|
| Buildings and improvements | | | 8 – 25 years | |
| Machinery and equipment, including leases | | | 5 – 8 years | |
| Leasehold improvements | | | Term of lease or useful life, whichever is shorter | |
(Amounts in thousands) | | | June 30, 2018 | | | December 31, 2017 | | ||||||
Foreign currency hedge included in other current assets | | | | $ | 988 | | | | | $ | 6 | | |
(Amounts in thousands) Description | | | Carrying Value | | | Fair Value Total | | | Quoted Prices in Active Markets for Identical Assets (Level 1) | | | Significant Other Observable Inputs (Level 2) | | | Significant Unobservable Inputs (Level 3) | | |||||||||||||||
Liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Senior Notes – 8.00% | | | | $ | 645,000 | | | | | $ | 665,963 | | | | | $ | 665,963 | | | | | $ | — | | | | | $ | — | | |
Term Loan Facility | | | | | 1,755,000 | | | | | | 1,749,524 | | | | | | — | | | | | | 1,749,524 | | | | | | — | | |
As of June 30, 2018 | | | | $ | 2,400,000 | | | | | $ | 2,415,487 | | | | | $ | 665,963 | | | | | $ | 1,749,524 | | | | | $ | — | | |
Liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Senior Notes – 6.50% | | | | $ | 650,000 | | | | | $ | 671,970 | | | | | $ | 671,970 | | | | | $ | — | | | | | $ | — | | |
Term Loan Facility | | | | | 213,875 | | | | | | 215,479 | | | | | | — | | | | | | 215,479 | | | | | | — | | |
As of December 31, 2017 | | | | $ | 863,875 | | | | | $ | 887,449 | | | | | $ | 671,970 | | | | | $ | 215,479 | | | | | $ | — | | |
|
(Amounts in thousands) | | | | | | | |
Assets acquired: | | | | | | | |
Accounts receivable | | | | $ | 270,758 | | |
Inventories | | | | | 288,518 | | |
Prepaid expenses and other current assets | | | | | 32,966 | | |
Property and equipment | | | | | 301,963 | | |
Intangible assets (tradenames/customer relationships) | | | | | 1,689,600 | | |
Goodwill | | | | | 1,235,096 | | |
Other assets | | | | | 12,923 | | |
Total assets acquired | | | | | 3,831,824 | | |
Liabilities assumed: | | | | | | | |
Accounts payable(1) | | | | | 119,882 | | |
Tax receivable agreement liability | | | | | 48,256 | | |
Other liabilities | | | | | 146,354 | | |
Accrued long-term warranty | | | | | 67,364 | | |
Deferred income taxes | | | | | 358,658 | | |
Other long-term liabilities | | | | | 26,997 | | |
Total liabilities assumed | | | | | 767,511 | | |
Net assets acquired | | | | $ | 3,064,313 | | |
|
| Professional fees | | | | $ | 32,059 | | |
| Long-term incentive plan liability acceleration based on change of control | | | | | 29,626 | | |
| Transaction bonuses | | | | | 8,900 | | |
| Other | | | | | 8,403 | | |
| | | | | $ | 78,988 | | |
|
| | | Successor | | | Predecessor | | ||||||
(Amounts in thousands) | | | June 30, 2018 | | | December 31, 2017 | | ||||||
Siding, Fencing and Stone | | | | $ | 713,649 | | | | | $ | 349,954 | | |
Windows and Doors | | | | | 518,743 | | | | | | 130,609 | | |
| | | | $ | 1,232,392 | | | | | $ | 480,563 | | |
|
(Amounts in thousands) | | | Windows and Doors | | | Siding, Fencing and Stone | | ||||||
Balance as of December 31, 2017 | | | | | | | | | | | | | |
Goodwill | | | | $ | 458,382 | | | | | $ | 472,181 | | |
Accumulated impairment losses | | | | | (327,773) | | | | | | (122,227) | | |
| | | | $ | 130,609 | | | | | $ | 349,954 | | |
Currency translation adjustments | | | | | (267) | | | | | | (577) | | |
Balance as of April 12, 2018 | | | | | | | | | | | | | |
Goodwill | | | | | 458,115 | | | | | | 471,604 | | |
Accumulated impairment losses | | | | | (327,773) | | | | | | (122,227) | | |
| | | | $ | 130,342 | | | | | $ | 349,377 | | |
Elimination of Predecessor goodwill | | | | | (130,342) | | | | | | (349,377) | | |
Goodwill recognized from Merger | | | | | 520,365 | | | | | | 714,731 | | |
Currency translation adjustments | | | | | (1,622) | | | | | | (1,082) | | |
Balance as of June 30, 2018 | | | | | | | | | | | | | |
Goodwill | | | | $ | 518,743 | | | | | $ | 713,649 | | |
|
(Amounts in thousands) | | | Average Amortization Period (in Years) | | | Cost | | | Accumulated Amortization | | | Net Carrying Value | | ||||||||||||
As of June 30, 2018 | | | | | | | | | | | | | | | | | | | | | | | | | |
Trademarks/Tradenames | | | | | 15 | | | | | $ | 182,700 | | | | | $ | (2,636) | | | | | $ | 180,064 | | |
Customer relationships | | | | | 15 | | | | | | 1,503,548 | | | | | | (21,460) | | | | | | 1,482,088 | | |
Total intangible assets | | | | | 15 | | | | | $ | 1,686,248 | | | | | $ | (24,096) | | | | | $ | 1,662,152 | | |
As of December 31, 2017 | | | | | | | | | | | | | | | | | | | | | | | | | |
Patents | | | | | 14 | | | | | $ | 12,770 | | | | | $ | (12,261) | | | | | $ | 509 | | |
Trademarks/Tradenames | | | | | 12 | | | | | | 117,473 | | | | | | (88,853) | | | | | | 28,620 | | |
Customer relationships | | | | | 13 | | | | | | 219,614 | | | | | | (166,086) | | | | | | 53,528 | | |
Other | | | | | 4 | | | | | | 5,750 | | | | | | (4,732) | | | | | | 1,018 | | |
Total intangible assets | | | | | 12 | | | | | $ | 355,607 | | | | | $ | (271,932) | | | | | $ | 83,675 | | |
|
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
(Amounts in thousands) | | | April 13, 2018 – June 30, 2018 | | | | April 1, 2018 – April 12, 2018 | | | Three months ended July 1, 2017 | | |||||||||
Amortization expense | | | | $ | 24,096 | | | | | | $ | 751 | | | | | $ | 5,258 | | |
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
(Amounts in thousands) | | | April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | Six months ended July 1, 2017 | | |||||||||
Amortization expense | | | | $ | 24,096 | | | | | | $ | 6,105 | | | | | $ | 10,602 | | |
(Amounts in thousands) | | | Amortization expense | | |||
2018 (remainder of year) | | | | $ | 57,067 | | |
2019 | | | | | 112,640 | | |
2020 | | | | | 112,640 | | |
2021 | | | | | 112,640 | | |
2022 | | | | | 112,640 | | |
(Amounts in thousands) | | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| April 13, 2018 – June 30, 2018 | | | | April 1, 2018 – April 12, 2018 | | | Three months ended July 1, 2017 | | |||||||||||
Net income (loss) | | | | $ | (20,411) | | | | | | $ | (62,217) | | | | | $ | 29,859 | | |
Foreign currency translation adjustment | | | | | (7,486) | | | | | | | 1,204 | | | | | | 1,279 | | |
Unrealized gain (loss) on derivative instruments | | | | | 742 | | | | | | | (610) | | | | | | (430) | | |
Comprehensive income (loss) | | | | $ | (27,155) | | | | | | $ | (61,623) | | | | | $ | 30,708 | | |
| | | | | | | | | | | |
(Amounts in thousands) | | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | Six months ended July 1, 2017 | | |||||||||||
Net income (loss) | | | | $ | (20,411) | | | | | | $ | (66,780) | | | | | $ | 26,222 | | |
Foreign currency translation adjustment | | | | | (7,486) | | | | | | | (643) | | | | | | 1,844 | | |
Unrealized gain (loss) on derivative instruments | | | | | 742 | | | | | | | 317 | | | | | | (976) | | |
Comprehensive income (loss) | | | | $ | (27,155) | | | | | | $ | (67,106) | | | | | $ | 27,090 | | |
| | | | | | | | | | | |
| | | Successor | | | Predecessor | | ||||||
(Amounts in thousands) | | | June 30, 2018 | | | December 31, 2017 | | ||||||
Senior secured asset based revolving credit facility | | | | $ | 130,000 | | | | | $ | — | | |
Term Loan Facility due 2021, net of unamortized early tender premium, discount, and debt issuance costs of $0 and $10,560, respectively | | | | | — | | | | | | 203,315 | | |
Cash Flow Revolver | | | | | — | | | | | | — | | |
6.50% Senior Notes due 2022, net of unamortized early tender premium, discount, and debt issuance costs of $0 and $41,681, respectively | | | | | — | | | | | | 608,319 | | |
Term Loan Facility due 2025, net of unamortized discount, and debt issuance costs of $51,144 and $0, respectively | | | | | 1,703,856 | | | | | | — | | |
8.00% Senior Notes due 2026, net of unamortized discount, and debt issuance costs of $26,708 and $0, respectively | | | | | 618,292 | | | | | | — | | |
| | | | $ | 2,452,148 | | | | | $ | 811,634 | | |
Less current portion of long-term debt | | | | | (17,550) | | | | | | (4,300) | | |
| | | | $ | 2,434,598 | | | | | $ | 807,334 | | |
|
| | | Rate | | |||
Interest rate | | | | | 6.09% | | |
Effective interest rate | | | | | 7.95% | | |
(in thousands) | | | June 30, 2018 | | |||
Excess availability | | | | $ | 183,812 | | |
Revolving loans outstanding | | | | | 130,000 | | |
Letters of credit outstanding | | | | | 14,341 | | |
(Amounts in thousands) | | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| April 13, 2018 – June 30, 2018 | | | | April 1, 2018 – April 12, 2018 | | | Three months ended July 1, 2017 | | |||||||||||
Service cost | | | | $ | — | | | | | | $ | — | | | | | $ | — | | |
Interest cost | | | | | 360 | | | | | | | 55 | | | | | | 459 | | |
Expected return on plan assets | | | | | (514) | | | | | | | (79) | | | | | | (546) | | |
Amortization of loss | | | | | 306 | | | | | | | 47 | | | | | | 351 | | |
Net periodic benefit expense | | | | $ | 152 | | | | | | $ | 23 | | | | | $ | 264 | | |
| | | | | | | | | | | |
(Amounts in thousands) | | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | Six months ended July 1, 2017 | | |||||||||||
Service cost | | | | $ | — | | | | | | $ | — | | | | | $ | — | | |
Interest cost | | | | | 360 | | | | | | | 470 | | | | | | 917 | | |
Expected return on plan assets | | | | | (514) | | | | | | | (672) | | | | | | (1,093) | | |
Amortization of loss | | | | | 306 | | | | | | | 400 | | | | | | 702 | | |
Net periodic benefit expense | | | | $ | 152 | | | | | | $ | 198 | | | | | $ | 526 | | |
| | | | | | | | | | | |
(Amounts in thousands) | | | June 30, 2018 | | | December 31, 2017 | | ||||||
Product claim liabilities | | | | $ | 138 | | | | | $ | 138 | | |
Multi-employer pension plan withdrawal liability | | | | | 269 | | | | | | 449 | | |
Other | | | | | 241 | | | | | | 439 | | |
| | | | $ | 648 | | | | | $ | 1,026 | | |
|
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
(Amounts in thousands) | | | April 13, 2018 – June 30, 2018 | | | | April 1, 2018 – April 12, 2018 | | | Three months ended July 1, 2017 | | |||||||||
Balance, beginning of period | | | | $ | 78,184 | | | | | | $ | 76,999 | | | | | $ | 78,451 | | |
Acquisition – Atrium | | | | | 8,047 | | | | | | | — | | | | | | — | | |
Warranty expense during period | | | | | 5,895 | | | | | | | 1,961 | | | | | | 5,545 | | |
Settlements made during period | | | | | (6,005) | | | | | | | (776) | | | | | | (5,782) | | |
Balance, end of period | | | | $ | 86,121 | | | | | | $ | 78,184 | | | | | $ | 78,214 | | |
| | | | | | | | | | | |
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
(Amounts in thousands) | | | April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | Six months ended July 1, 2017 | | |||||||||
Balance, beginning of period | | | | $ | 78,184 | | | | | | $ | 77,317 | | | | | $ | 77,293 | | |
Acquisition – Atrium | | | | | 8,047 | | | | | | | — | | | | | | — | | |
Warranty expense during period | | | | | 5,895 | | | | | | | 7,226 | | | | | | 11,708 | | |
Settlements made during period | | | | | (6,005) | | | | | | | (6,359) | | | | | | (10,787) | | |
Balance, end of period | | | | $ | 86,121 | | | | | | $ | 78,184 | | | | | $ | 78,214 | | |
| | | | | | | | | | | |
| | | Successor | | | Predecessor | | ||||||
(Amounts in thousands) | | | June 30, 2018 | | | December 31, 2017 | | ||||||
Insurance | | | | $ | 9,489 | | | | | $ | 7,637 | | |
Employee compensation and benefits | | | | | 24,186 | | | | | | 19,720 | | |
Sales and marketing | | | | | 51,405 | | | | | | 58,131 | | |
Product warranty | | | | | 21,923 | | | | | | 19,652 | | |
Accrued freight | | | | | 4,000 | | | | | | 3,696 | | |
Accrued interest | | | | | 35,659 | | | | | | 18,027 | | |
Accrued pension | | | | | 1,358 | | | | | | 1,358 | | |
Accrued sales returns and discounts | | | | | 2,022 | | | | | | 1,303 | | |
Accrued taxes | | | | | 12,416 | | | | | | 4,735 | | |
Undistributed appraisal shares liability | | | | | 25,362 | | | | | | — | | |
Litigation accrual | | | | | 700 | | | | | | 26,849 | | |
Other | | | | | 49,120 | | | | | | 24,749 | | |
| | | | $ | 237,640 | | | | | $ | 185,857 | | |
|
| | | Successor | | | Predecessor | | ||||||
(Amounts in thousands) | | | June 30, 2018 | | | December 31, 2017 | | ||||||
Insurance | | | | $ | 3,750 | | | | | $ | 595 | | |
Pension liabilities | | | | | 12,677 | | | | | | 12,805 | | |
Multi-employer pension withdrawal liability | | | | | 269 | | | | | | 449 | | |
Product warranty | | | | | 64,198 | | | | | | 57,665 | | |
Long-term environmental liability | | | | | 1,069 | | | | | | 1,075 | | |
Liabilities for tax uncertainties | | | | | 4,717 | | | | | | 4,529 | | |
Litigation accrual | | | | | 644 | | | | | | 731 | | |
Other | | | | | 3,752 | | | | | | 5,575 | | |
| | | | $ | 91,076 | | | | | $ | 83,424 | | |
|
| | | Stock Options | | | Weighted- Average Exercise Price | | | Weighted- Average Remaining Contractual Term (Years) | | |||||||||
Balance at January 1, 2018 | | | | | 2,398,181 | | | | | $ | 14.02 | | | | | | 3.43 | | |
Granted | | | | | — | | | | | | — | | | | | | — | | |
Exercised | | | | | (231,878) | | | | | | 12.35 | | | | | | — | | |
Forfeited or expired | | | | | — | | | | | | — | | | | | | — | | |
April 12, 2018 | | | | | 2,166,303 | | | | | $ | 14.20 | | | | | | 3.34 | | |
|
(Amounts in thousands) | | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| April 13, 2018 – June 30, 2018 | | | | April 1, 2018 – April 12, 2018 | | | Three months ended July 1, 2017 | | |||||||||||
Net sales | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | $ | 247,193 | | | | | | $ | 29,794 | | | | | $ | 263,593 | | |
Windows and Doors | | | | | 350,743 | | | | | ��� | | 39,945 | | | | | | 281,174 | | |
| | | | $ | 597,936 | | | | | | $ | 69,739 | | | | | $ | 544,767 | | |
Operating earnings (loss) | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | $ | 6,815 | | | | | | $ | 2,175 | | | | | $ | 47,580 | | |
Windows and Doors | | | | | 24,704 | | | | | | | 2,417 | | | | | | 24,725 | | |
Unallocated | | | | | (18,079) | | | | | | | (68,915) | | | | | | (6,206) | | |
| | | | $ | 13,440 | | | | | | $ | (64,323) | | | | | $ | 66,099 | | |
| | | | | | | | | | | |
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
| | | April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | Six months ended July 1, 2017 | | |||||||||
Net sales | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | $ | 247,193 | | | | | | $ | 225,940 | | | | | $ | 454,430 | | |
Windows and Doors | | | | | 350,743 | | | | | | | 303,703 | | | | | | 520,352 | | |
| | | | $ | 597,936 | | | | | | $ | 529,643 | | | | | $ | 974,782 | | |
Operating earnings (loss) | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | $ | 6,815 | | | | | | $ | 15,974 | | | | | $ | 67,403 | | |
Windows and Doors | | | | | 24,704 | | | | | | | 7,625 | | | | | | 26,154 | | |
Unallocated | | | | | (18,079) | | | | | | | (75,901) | | | | | | (15,632) | | |
| | | | $ | 13,440 | | | | | | $ | (52,302) | | | | | $ | 77,925 | | |
| | | | | | | | | | | |
| | | Total assets as of | | |||||||||
| | | Successor | | | Predecessor | | ||||||
| | | June 30, 2018 | | | December 31, 2017 | | ||||||
Total assets | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | $ | 1,949,149 | | | | | $ | 728,502 | | |
Windows and Doors | | | | | 1,880,625 | | | | | | 500,278 | | |
Unallocated | | | | | 56,472 | | | | | | 90,787 | | |
| | | | $ | 3,886,246 | | | | | $ | 1,319,567 | | |
|
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
(Amounts in thousands) | | | April 13, 2018 – June 30, 2018 | | | | April 1, 2018 – April 12, 2018 | | | Three months ended July 1, 2017 | | |||||||||
| | | (unaudited) | | | | (unaudited) | | | (unaudited) | | |||||||||
Net sales | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | $ | 247,193 | | | | | | $ | 29,794 | | | | | $ | 263,593 | | |
Windows and Doors | | | | | 350,743 | | | | | | | 39,945 | | | | | | 281,174 | | |
Operating earnings (loss) | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | | 6,815 | | | | | | | 2,175 | | | | | | 47,580 | | |
Windows and Doors | | | | | 24,704 | | | | | | | 2,417 | | | | | | 24,725 | | |
Unallocated | | | | | (18,079) | | | | | | | (68,915) | | | | | | (6,206) | | |
Foreign currency gain (loss) | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | | (386) | | | | | | | 148 | | | | | | 224 | | |
Windows and Doors | | | | | (1,130) | | | | | | | 461 | | | | | | 393 | | |
Interest income (expense), net | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | | 5 | | | | | | | 2 | | | | | | 5 | | |
Windows and Doors | | | | | (39) | | | | | | | — | | | | | | 4 | | |
Unallocated | | | | | (43,729) | | | | | | | (2,599) | | | | | | (17,389) | | |
Income tax benefit (expense) | | | | | | | | | | | | | | | | | | | | |
Unallocated | | | | | 11,428 | | | | | | | 9,331 | | | | | | (19,477) | | |
Tax Receivable Agreement liability adjustment | | | | | | | | | | | | | | | | | | | | |
Unallocated | | | | | — | | | | | | | (5,237) | | | | | | — | | |
Net income (loss) | | | | $ | (20,411) | | | | | | $ | (62,217) | | | | | $ | 29,859 | | |
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
(Amounts in thousands) | | | April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | Six months ended July 1, 2017 | | |||||||||
| | | (unaudited) | | | | (unaudited) | | | (unaudited) | | |||||||||
Net sales | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | $ | 247,193 | | | | | | $ | 225,940 | | | | | $ | 454,430 | | |
Windows and Doors | | | | | 350,743 | | | | | | | 303,703 | | | | | | 520,352 | | |
Operating earnings (loss) | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | | 6,815 | | | | | | | 15,974 | | | | | | 67,403 | | |
Windows and Doors | | | | | 24,704 | | | | | | | 7,625 | | | | | | 26,154 | | |
Unallocated | | | | | (18,079) | | | | | | | (75,901) | | | | | | (15,632) | | |
Foreign currency gain (loss) | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | | (386) | | | | | | | (103) | | | | | | 243 | | |
Windows and Doors | | | | | (1,130) | | | | | | | (29) | | | | | | 529 | | |
Interest income (expense), net | | | | | | | | | | | | | | | | | | | | |
Siding, Fencing and Stone | | | | | 5 | | | | | | | 1 | | | | | | 13 | | |
Windows and Doors | | | | | (39) | | | | | | | 13 | | | | | | 8 | | |
Unallocated | | | | | (43,729) | | | | | | | (19,046) | | | | | | (34,273) | | |
Income tax benefit (expense) | | | | | | | | | | | | | | | | | | | | |
Unallocated | | | | | 11,428 | | | | | | | 9,923 | | | | | | (18,223) | | |
Tax Receivable Agreement liability adjustment | | | | | | | | | | | | | | | | | | | | |
Unallocated | | | | | — | | | | | | | (5,237) | | | | | | — | | |
Net income (loss) | | | | $ | (20,411) | | | | | | $ | (66,780) | | | | | $ | 26,222 | | |
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
(Amounts in thousands) | | | April 13, 2018 – June 30, 2018 | | | | April 1, 2018 – April 12, 2018 | | | Three months ended July 1, 2017 | | |||||||||
Net income (loss) | | | | $ | (20,411) | | | | | | $ | (62,217) | | | | | $ | 29,859 | | |
Interest expense, net | | | | | 43,763 | | | | | | | 2,597 | | | | | | 17,380 | | |
Provision (benefit) for income taxes | | | | | (11,428) | | | | | | | (9,331) | | | | | | 19,477 | | |
Depreciation and amortization | | | | | 31,081 | | | | | | | 1,839 | | | | | | 13,102 | | |
EBITDA | | | | | 43,005 | | | | | | | (67,112) | | | | | | 79,818 | | |
Non cash loss (gain) on foreign currency transactions | | | | | 1,516 | | | | | | | (609) | | | | | | (617) | | |
Acquisition costs | | | | | 11,186 | | | | | | | 67,802 | | | | | | — | | |
Customer inventory buybacks | | | | | 339 | | | | | | | 66 | | | | | | 632 | | |
Restructuring/integration expense | | | | | 1,325 | | | | | | | 6 | | | | | | 455 | | |
Non cash charge of purchase price allocated to inventories | | | | | 35,443 | | | | | | | — | | | | | | — | | |
Public company costs | | | | | — | | | | | | | — | | | | | | 337 | | |
Retention expense | | | | | 89 | | | | | | | — | | | | | | 361 | | |
Long term incentive plan compensation | | | | | — | | | | | | | 229 | | | | | | 1,238 | | |
Stock option expense | | | | | — | | | | | | | — | | | | | | 92 | | |
Litigation – class action charges, net | | | | | — | | | | | | | — | | | | | | 825 | | |
Tax receivable agreement liability adjustment | | | | | — | | | | | | | 5,237 | | | | | | — | | |
Adjusted EBITDA | | | | $ | 92,903 | | | | | | $ | 5,619 | | | | | $ | 83,141 | | |
| | | | | | | | | | | |
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
(Amounts in thousands) | | | April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | Six months ended July 1, 2017 | | |||||||||
Net income (loss) | | | | $ | (20,411) | | | | | | $ | (66,780) | | | | | $ | 26,222 | | |
Interest expense, net | | | �� | | 43,763 | | | | | | | 19,032 | | | | | | 34,252 | | |
Provision (benefit) for income taxes | | | | | (11,428) | | | | | | | (9,923) | | | | | | 18,223 | | |
Depreciation and amortization | | | | | 31,081 | | | | | | | 15,274 | | | | | | 26,555 | | |
EBITDA | | | | | 43,005 | | | | | | | (42,397) | | | | | | 105,252 | | |
Non cash loss (gain) on foreign currency transactions | | | | | 1,516 | | | | | | | 132 | | | | | | (772) | | |
Acquisition costs | | | | | 11,186 | | | | | | | 67,802 | | | | | | — | | |
Customer inventory buybacks | | | | | 339 | | | | | | | 1,518 | | | | | | 1,198 | | |
Restructuring/integration expense | | | | | 1,325 | | | | | | | 224 | | | | | | 1,412 | | |
Non cash charge of purchase price allocated to inventories | | | | | 35,443 | | | | | | | — | | | | | | — | | |
Public company costs | | | | | — | | | | | | | 500 | | | | | | 774 | | |
Retention expense | | | | | 89 | | | | | | | 103 | | | | | | 722 | | |
Long term incentive plan compensation | | | | | — | | | | | | | 985 | | | | | | 2,672 | | |
Stock option expense | | | | | — | | | | | | | 36 | | | | | | 263 | | |
Litigation – class action charges, net | | | | | — | | | | | | | — | | | | | | 1,113 | | |
Tax receivable agreement liability adjustment | | | | | — | | | | | | | 5,237 | | | | | | — | | |
Adjusted EBITDA | | | | $ | 92,903 | | | | | | $ | 34,140 | | | | | $ | 112,634 | | |
| | | | | | | | | | | |
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||||||||||||||||||||
(Amounts in thousands) | | | April 13, 2018 – June 30, 2018 | | | | April 1, 2018 – April 12, 2018 | | | For the three months ended July 1, 2017 | | |||||||||||||||||||||||||||
| | | (unaudited) | | | | (unaudited) | | | (unaudited) | | |||||||||||||||||||||||||||
Statement of operations data: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net sales | | | | $ | 247,193 | | | | | | 100.0% | | | | | | $ | 29,794 | | | | | | 100.0% | | | | | $ | 263,593 | | | | | | 100.0% | | |
Gross profit | | | | | 38,460 | | | | | | 15.6% | | | | | | | 6,119 | | | | | | 20.5% | | | | | | 73,032 | | | | | | 27.7% | | |
SG&A expense (including acquisition costs) | | | | | 19,589 | | | | | | 7.9% | | | | | | | 3,620 | | | | | | 12.2% | | | | | | 23,270 | | | | | | 8.8% | | |
Amortization of intangible assets | | | | | 12,056 | | | | | | 4.9% | | | | | | | 324 | | | | | | 1.1% | | | | | | 2,182 | | | | | | 0.8% | | |
Operating earnings | | | | | 6,815 | | | | | | 2.8% | | | | | | | 2,175 | | | | | | 7.3% | | | | | | 47,580 | | | | | | 18.1% | | |
Currency transaction gain (loss) | | | | | (386) | | | | | | (0.2)% | | | | | | | 148 | | | | | | 0.5% | | | | | | 224 | | | | | | 0.1% | | |
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||||||||||||||||||||
(Amounts in thousands) | | | April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | For the six months ended July 1, 2017 | | |||||||||||||||||||||||||||
| | | (unaudited) | | | | (unaudited) | | | (unaudited) | | |||||||||||||||||||||||||||
Statement of operations data: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net sales | | | | $ | 247,193 | | | | | | 100.0% | | | | | | $ | 225,940 | | | | | | 100.0% | | | | | $ | 454,430 | | | | | | 100.0% | | |
Gross profit | | | | | 38,460 | | | | | | 15.6% | | | | | | | 46,809 | | | | | | 20.7% | | | | | | 118,995 | | | | | | 26.2% | | |
SG&A expense (including acquisition costs) | | | | | 19,589 | | | | | | 7.9% | | | | | | | 28,236 | | | | | | 12.5% | | | | | | 47,146 | | | | | | 10.4% | | |
Amortization of intangible assets | | | | | 12,056 | | | | | | 4.9% | | | | | | | 2,599 | | | | | | 1.2% | | | | | | 4,446 | | | | | | 1.0% | | |
Operating earnings | | | | | 6,815 | | | | | | 2.8% | | | | | | | 15,974 | | | | | | 7.1% | | | | | | 67,403 | | | | | | 14.8% | | |
Currency transaction gain (loss) | | | | | (386) | | | | | | (0.2)% | | | | | | | (103) | | | | | | —% | | | | | | 243 | | | | | | 0.1% | | |
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||||||||||||||||||||
(Amounts in thousands) | | | April 13, 2018 – June 30, 2018 | | | | April 1, 2018 – April 12, 2018 | | | For the three months ended July 1, 2017 | | |||||||||||||||||||||||||||
| | | (unaudited) | | | | (unaudited) | | | (unaudited) | | |||||||||||||||||||||||||||
Statement of operations data: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net sales | | | | $ | 350,743 | | | | | | 100.0% | | | | | | $ | 39,945 | | | | | | 100.0% | | | | | $ | 281,174 | | | | | | 100.0% | | |
Gross profit | | | | | 80,074 | | | | | | 22.8% | | | | | | | 8,800 | | | | | | 22.0% | | | | | | 63,856 | | | | | | 22.7% | | |
SG&A expense (including acquisition costs) | | | | | 43,330 | | | | | | 12.4% | | | | | | | 5,956 | | | | | | 14.9% | | | | | | 36,055 | | | | | | 12.8% | | |
Amortization of intangible assets | | | | | 12,040 | | | | | | 3.4% | | | | | | | 427 | | | | | | 1.1% | | | | | | 3,076 | | | | | | 1.1% | | |
Operating earnings | | | | | 24,704 | | | | | | 7.0% | | | | | | | 2,417 | | | | | | 6.1% | | | | | | 24,725 | | | | | | 8.8% | | |
Currency transaction gain (loss) | | | | | (1,130) | | | | | | (0.3)% | | | | | | | 461 | | | | | | 1.2% | | | | | | 393 | | | | | | 0.1% | | |
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||||||||||||||||||||
(Amounts in thousands) | | | April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | For the six months ended July 1, 2017 | | |||||||||||||||||||||||||||
| | | (unaudited) | | | | (unaudited) | | | (unaudited) | | |||||||||||||||||||||||||||
Statement of operations data: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net sales | | | | $ | 350,743 | | | | | | 100.0% | | | | | | $ | 303,703 | | | | | | 100.0% | | | | | $ | 520,352 | | | | | | 100.0% | | |
Gross profit | | | | | 80,074 | | | | | | 22.8% | | | | | | | 56,160 | | | | | | 18.5% | | | | | | 107,418 | | | | | | 20.6% | | |
SG&A expense (including acquisition costs) | | | | | 43,330 | | | | | | 12.4% | | | | | | | 45,029 | | | | | | 14.8% | | | | | | 75,108 | | | | | | 14.4% | | |
Amortization of intangible assets | | | | | 12,040 | | | | | | 3.4% | | | | | | | 3,506 | | | | | | 1.2% | | | | | | 6,156 | | | | | | 1.2% | | |
Operating earnings | | | | | 24,704 | | | | | | 7.0% | | | | | | | 7,625 | | | | | | 2.5% | | | | | | 26,154 | | | | | | 5.0% | | |
Currency transaction gain (loss) | | | | | (1,130) | | | | | | (0.3)% | | | | | | | (29) | | | | | | —% | | | | | | 529 | | | | | | 0.1% | | |
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
(Amounts in thousands) | | | April 13, 2018 – June 30, 2018 | | | | April 1, 2018 – April 12, 2018 | | | For the three months ended July 1, 2017 | | |||||||||
| | | (unaudited) | | | | (unaudited) | | | (unaudited) | | |||||||||
Statement of operations data: | | | | | | | | | | | | | | | | | | | | |
SG&A expense | | | | $ | (8,557) | | | | | | $ | (1,149) | | | | | $ | (6,206) | | |
Acquisition related expenses | | | | | (9,522) | | | | | | | (67,766) | | | | | | — | | |
Operating loss | | | | | (18,079) | | | | | | | (68,915) | | | | | | (6,206) | | |
Interest expense | | | | | (43,736) | | | | | | | (2,599) | | | | | | (17,399) | | |
Interest income | | | | | 7 | | | | | | | — | | | | | | 10 | | |
Tax Receivable Agreement liability adjustment | | | | | — | | | | | | | (5,237) | | | | | | — | | |
Income tax benefit (provision) for income taxes | | | | $ | 11,428 | | | | | | $ | 9,331 | | | | | $ | (19,477) | | |
| | | Successor | | | | Predecessor | | | Predecessor | | |||||||||
(Amounts in thousands) | | | April 13, 2018 – June 30, 2018 | | | | January 1, 2018 – April 12, 2018 | | | For the six months ended July 1, 2017 | | |||||||||
| | | (unaudited) | | | | (unaudited) | | | (unaudited) | | |||||||||
Statement of operations data: | | | | | | | | | | | | | | | | | | | | |
SG&A expense | | | | $ | (8,557) | | | | | | $ | (8,135) | | | | | $ | (15,632) | | |
Acquisition related expenses | | | | | (9,522) | | | | | | | (67,766) | | | | | | — | | |
Operating loss | | | | | (18,079) | | | | | | | (75,901) | | | | | | (15,632) | | |
Interest expense | | | | | (43,736) | | | | | | | (19,054) | | | | | | (34,285) | | |
Interest income | | | | | 7 | | | | | | | 8 | | | | | | 12 | | |
Tax receivable agreement liability adjustment | | | | | — | | | | | | | (5,237) | | | | | | — | | |
Income tax benefit (provision) for income taxes | | | | $ | 11,428 | | | | | | $ | 9,923 | | | | | $ | (18,223) | | |
| REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS | | | Grant Thornton LLP 201 S College Street, Suite 2500 Charlotte, NC 28244-0100 T 704.632.3500 F 704.334.7701 www.GrantThornton.com | |
| | | 2017 | | | 2016 | | ||||||
ASSETS | | ||||||||||||
CURRENT ASSETS: | | | | | | | | | | | | | |
Cash and cash equivalents | | | | $ | 3,035 | | | | | $ | 1,810 | | |
Restricted cash | | | | | 100 | | | | | | 100 | | |
Accounts receivable, net of allowance for doubtful accounts of $373 and $237, respectively | | | | | 27,081 | | | | | | 24,997 | | |
Inventories | | | | | 15,765 | | | | | | 16,656 | | |
Prepaid expenses and other current assets | | | | | 3,873 | | | | | | 3,480 | | |
Assets of discontinued operations | | | | | 63 | | | | | | 324 | | |
Total current assets | | | | | 49,917 | | | | | | 47,367 | | |
LONG-TERM ASSETS: | | | | | | | | | | | | | |
Property, plant and equipment, net | | | | | 29,392 | | | | | | 29,692 | | |
Goodwill | | | | | 36,780 | | | | | | 31,492 | | |
Intangible assets, net | | | | | 92,509 | | | | | | 89,196 | | |
Other assets, net | | | | | 5,032 | | | | | | 5,697 | | |
Total long-term assets | | | | | 163,713 | | | | | | 156,077 | | |
Total assets | | | | $ | 213,630 | | | | | $ | 203,444 | | |
LIABILITIES AND STOCKHOLDERS’ DEFICIT | | ||||||||||||
CURRENT LIABILITIES: | | | | | | | | | | | | | |
Current portion of long-term debt | | | | $ | 42 | | | | | $ | 287 | | |
Accounts payable | | | | | 12,389 | | | | | | 16,030 | | |
Accrued liabilities | | | | | 21,570 | | | | | | 29,283 | | |
Liabilities of discontinued operations | | | | | 1,770 | | | | | | 2,599 | | |
Total current liabilities | | | | | 35,771 | | | | | | 48,199 | | |
LONG-TERM LIABILITIES: | | | | | | | | | | | | | |
Long-term debt, net of current | | | | | 301,974 | | | | | | 299,543 | | |
Long-term debt due to related party | | | | | 77,326 | | | | | | 68,371 | | |
Long-term liabilities of discontinued operations | | | | | 722 | | | | | | 1,939 | | |
Deferred tax liabilities | | | | | 17,145 | | | | | | 18,037 | | |
Other long-term liabilities | | | | | 8,274 | | | | | | 10,409 | | |
Total long-term liabilities | | | | | 405,441 | | | | | | 398,299 | | |
Total liabilities | | | | | 441,212 | | | | | | 446,498 | | |
COMMITMENTS AND CONTINGENCIES (see Notes 9, 10, 12, 13 and 15) | | | | | | | | | | | | | |
STOCKHOLDERS’ DEFICIT: | | | | | | | | | | | | | |
Series A Preferred stock $.01 par value, 600,000 shares authorized, 321,494 shares issued and outstanding | | | | | 2 | | | | | | 2 | | |
Series B Preferred stock $0.01 par and 22,141 shares issued and outstanding | | | | | — | | | | | | — | | |
Common stock $.01 par value, 3,000,000 shares authorized 2,009,964 shares issued and outstanding | | | | | 20 | | | | | | 20 | | |
Paid-in capital | | | | | 248,505 | | | | | | 240,005 | | |
Accumulated deficit | | | | | (453,615) | | | | | | (453,593) | | |
Accumulated other comprehensive loss | | | | | (22,494) | | | | | | (29,488) | | |
Total stockholders’ deficit | | | | | (227,582) | | | | | | (243,054) | | |
Total liabilities and stockholders’ deficit | | | | $ | 213,630 | | | | | $ | 203,444 | | |
|
| | | 2017 | | | 2016 | | ||||||
NET SALES | | | | $ | 348,844 | | | | | $ | 312,628 | | |
COST OF GOODS SOLD | | | | | 234,451 | | | | | | 214,688 | | |
Gross profit | | | | | 114,393 | | | | | | 97,940 | | |
OPERATING EXPENSES: | | | | | | | | | | | | | |
Selling, delivery, general and administrative expenses | | | | | 67,572 | | | | | | 63,364 | | |
Amortization expense | | | | | 6,723 | | | | | | 6,231 | | |
Stock compensation expense | | | | | 1 | | | | | | 11 | | |
Total selling, delivery, general and administrative expenses | | | | | 74,296 | | | | | | 69,606 | | |
Impairment of trade names | | | | | 1,560 | | | | | | 200 | | |
(Gain) loss on disposal of assets, net | | | | | (239) | | | | | | 288 | | |
Total operating expenses | | | | | 75,617 | | | | | | 70,094 | | |
OPERATING INCOME FROM CONTINUING OPERATIONS | | | | | 38,776 | | | | | | 27,846 | | |
Interest expense | | | | | 35,903 | | | | | | 42,479 | | |
Other expense, net | | | | | 226 | | | | | | 546 | | |
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | | | | | 2,647 | | | | | | (15,179) | | |
Income tax expense | | | | | 1,521 | | | | | | 1,320 | | |
INCOME (LOSS) FROM CONTINUING OPERATIONS | | | | | 1,126 | | | | | | (16,499) | | |
Loss from discontinued operations, net of tax | | | | | (1,148) | | | | | | (8,173) | | |
NET LOSS | | | | | (22) | | | | | | (24,672) | | |
Other comprehensive income, net of taxes: | | | | | | | | | | | | | |
Foreign currency translation adjustment | | | | | 6,994 | | | | | | 2,481 | | |
Comprehensive income (loss) | | | | $ | 6,972 | | | | | $ | (22,191) | | |
|
| | | Series A Preferred Stock | | | Series B Preferred Stock | | | Common Stock | | | Additional Paid-in Capital | | | Accumulated Deficit | | | Accumulated Other Comprehensive Income (Loss) | | | Total | | |||||||||||||||||||||||||||||||||||||||
| | | Shares | | | Amount | | | Shares | | | Amount | | | Shares | | | Amount | | ||||||||||||||||||||||||||||||||||||||||||
BALANCES, JANUARY 1, 2016 | | | | | 321,494 | | | | | $ | 2 | | | | | | — | | | | | $ | — | | | | | | 2,009,964 | | | | | $ | 20 | | | | | $ | 232,994 | | | | | $ | (428,921) | | | | | $ | (31,969) | | | | | $ | (227,874) | | |
Equity based compensation | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 11 | | | | | | — | | | | | | — | | | | | | 11 | | |
Issuance preferred stock | | | | | — | | | | | | — | | | | | | 10,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | 7,000 | | | | | | — | | | | | | — | | | | | | 7,000 | | |
Net loss | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | ��� | | | | | (24,672) | | | | | | — | | | | | | (24,672) | | |
Foreign currency translation gain | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 2,481 | | | | | | 2,481 | | |
BALANCES, DECEMBER 31, 2016 | | | | | 321,494 | | | | | | 2 | | | | | | 10,000 | | | | | | — | | | | | | 2,009,964 | | | | | | 20 | | | | | | 240,005 | | | | | | (453,593) | | | | | | (29,488) | | | | | | (243,054) | | |
Equity based compensation | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 1 | | | | | | — | | | | | | — | | | | | | 1 | | |
Issuance preferred stock | | | | | — | | | | | | — | | | | | | 12,141 | | | | | | — | | | | | | — | | | | | | — | | | | | | 8,499 | | | | | | — | | | | | | — | | | | | | 8,499 | | |
Net loss | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (22) | | | | | | — | | | | | | (22) | | |
Foreign currency translation gain | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 6,994 | | | | | | 6,994 | | |
BALANCES, DECEMBER 31, 2017 | | | | | 321,494 | | | | | $ | 2 | | | | | | 22,141 | | | | | $ | — | | | | | | 2,009,964 | | | | | $ | 20 | | | | | $ | 248,505 | | | | | $ | (453,615) | | | | | $ | (22,494) | | | | | $ | (227,582) | | |
|
| | | 2017 | | | 2016 | | ||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | | | | | | | | | | | | | |
Net loss | | | | $ | (22) | | | | | $ | (24,672) | | |
Adjustments to reconcile net loss to net cash provided by operating activities: | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 13,424 | | | | | | 13,776 | | |
Amortization of deferred financing costs | | | | | 1,620 | | | | | | 1,506 | | |
Accretion of notes discount | | | | | 903 | | | | | | 8,045 | | |
Non-cash interest | | | | | 8,955 | | | | | | 7,692 | | |
Impairment of trade names | | | | | 1,560 | | | | | | 200 | | |
Loss on sales of divisions | | | | | — | | | | | | 5,783 | | |
(Gain) loss on disposal of assets | | | | | (240) | | | | | | 301 | | |
Non-cash equity based compensation | | | | | 1 | | | | | | 11 | | |
Deferred taxes | | | | | (2,106) | | | | | | (2,004) | | |
Changes in assets and liabilities | | | | | | | | | | | | | |
Accounts receivable | | | | | (1,230) | | | | | | (3,748) | | |
Inventories | | | | | 1,287 | | | | | | (1,124) | | |
Prepaid expenses and other assets | | | | | (331) | | | | | | 1,414 | | |
Other long-term assets | | | | | 531 | | | | | | (68) | | |
Accounts payable | | | | | (3,480) | | | | | | 3,763 | | |
Accrued and other long-term liabilities | | | | | (9,617) | | | | | | 3,366 | | |
Net cash provided by operating activities | | | | | 11,255 | | | | | | 14,241 | | |
CASH FLOWS FROM INVESTING ACTIVITIES: | | | | | | | | | | | | | |
Purchases of property, plant and equipment | | | | | (6,862) | | | | | | (9,347) | | |
Proceeds from sales of assets | | | | | 361 | | | | | | 117 | | |
Proceeds from sales of divisions | | | | | — | | | | | | 12,939 | | |
Purchase of entry door company | | | | | (9,036) | | | | | | — | | |
Purchase of window and door company | | | | | (332) | | | | | | (6,703) | | |
Net cash used in investing activities | | | | | (15,869) | | | | | | (2,994) | | |
CASH FLOWS FROM FINANCING ACTIVITIES: | | | | | | | | | | | | | |
Borrowings under previous ABL credit facility | | | | | — | | | | | | 17,600 | | |
Payments on previous ABL credit facility | | | | | — | | | | | | (32,200) | | |
Borrowings under current ABL credit facility | | | | | 14,466 | | | | | | 275 | | |
Payments on current ABL credit facility | | | | | (14,741) | | | | | | — | | |
Proceeds stock issuances | | | | | 8,499 | | | | | | 7,000 | | |
Payments on term note | | | | | (1,500) | | | | | | (2,000) | | |
Payment on contingent consideration | | | | | (1,199) | | | | | | — | | |
Payments on capital leases | | | | | (33) | | | | | | (101) | | |
Net cash provided by (used in) financing activities | | | | | 5,492 | | | | | | (9,426) | | |
EFFECT OF EXCHANGE RATE CHANGES | | | | $ | 347 | | | | | $ | (66) | | |
NET INCREASE IN CASH AND CASH EQUIVALENTS | | | | | 1,225 | | | | | | 1,755 | | |
CASH AND CASH EQUIVALENTS – Beginning of period | | | | | 1,810 | | | | | | 55 | | |
CASH AND CASH EQUIVALENTS – End of period | | | | $ | 3,035 | | | | | $ | 1,810 | | |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | | | | | | | | | | | | | |
Cash paid for: | | | | | | | | | | | | | |
Interest | | | | $ | 23,758 | | | | | $ | 23,918 | | |
Income taxes | | | | $ | 3,187 | | | | | $ | 2,087 | | |
Non-cash investing activities: | | | | | | | | | | | | | |
Purchase of intangibles and goodwill through contingent consideration | | | | $ | — | | | | | $ | 1,882 | | |
Purchases of property, plant and equipment | | | | $ | 95 | | | | | $ | 334 | | |
Purchases of property, plant and equipment on capital lease | | | | $ | 83 | | | | | $ | 335 | | |
|
| | | Estimated Useful Life | |
Buildings and improvements | | | 20 – 30 years | |
Machinery and equipment | | | 3 – 10 years | |
Software implementation costs | | | 3 years | |
| | | 2017 | | | 2016 | | ||||||
Beginning reserve for warranties | | | | $ | (3,829) | | | | | $ | (3,267) | | |
Change in provision | | | | | (4,961) | | | | | | (5,169) | | |
Settlements | | | | | 4,923 | | | | | | 4,607 | | |
Ending reserve for warranties | | | | $ | (3,867) | | | | | $ | (3,829) | | |
|
| | | 2017 | | | 2016 | | ||||||
Beginning deferred revenue | | | | $ | (2,330) | | | | | $ | (1,813) | | |
Sales | | | | | (1,211) | | | | | | (1,214) | | |
Amortization | | | | | 834 | | | | | | 697 | | |
Ending deferred revenue | | | | $ | (2,707) | | | | | $ | (2,330) | | |
|
| | | 2017 | | | 2016 | | ||||||
Raw materials | | | | $ | 12,906 | | | | | $ | 13,422 | | |
Work in process | | | | | 336 | | | | | | 244 | | |
Finished goods | | | | | 2,523 | | | | | | 2,990 | | |
Total | | | | $ | 15,765 | | | | | $ | 16,656 | | |
|
| | | 2017 | | | 2016 | | ||||||
Land | | | | $ | 638 | | | | | $ | 596 | | |
Buildings and leasehold improvements | | | | | 11,799 | | | | | | 10,089 | | |
Machinery and equipment | | | | | 63,420 | | | | | | 58,258 | | |
Internally developed software | | | | | 2,688 | | | | | | 2,684 | | |
Construction-in-process | | | | | 1,059 | | | | | | 1,374 | | |
Total | | | | | 79,604 | | | | | | 73,001 | | |
Less accumulated depreciation | | | | | (50,212) | | | | | | (43,309) | | |
Net property, plant and equipment | | | | $ | 29,392 | | | | | $ | 29,692 | | |
|
| | | 2017 | | | 2016 | | ||||||
Hardware | | | | $ | 449 | | | | | $ | 449 | | |
Vehicles | | | | | 88 | | | | | | — | | |
Machinery and equipment | | | | | 29 | | | | | | 29 | | |
Office equipment | | | | | 44 | | | | | | 55 | | |
Total | | | | | 610 | | | | | | 533 | | |
Less accumulated depreciation | | | | | (527) | | | | | | (490) | | |
Net capital lease assets | | | | $ | 83 | | | | | $ | 43 | | |
|
| | | Goodwill | | |||
Balance, December 31, 2015 | | | | $ | 26,734 | | |
Foreign currency translation adjustments | | | | | 655 | | |
Goodwill on acquisition of window and door company | | | | | 4,103 | | |
Balance, December 31, 2016 | | | | | 31,492 | | |
Foreign currency translation adjustments | | | | | 2,016 | | |
Goodwill on acquisition of entry door company | | | | | 3,272 | | |
Balance, December 31, 2017 | | | | $ | 36,780 | | |
|
2017 | | ||||||||||||||||||||||||||||||||||||
| | | Beginning | | | Additions | | | Amortization | | | Impairment | | | Currency Translation Adjustments | | | Ending | | ||||||||||||||||||
Intangible assets with finite lives | | | | | | | | ||||||||||||||||||||||||||||||
Customer relationships | | | | $ | 105,653 | | | | | $ | 4,518 | | | | | $ | — | | | | | $ | — | | | | | $ | 5,661 | | | | | $ | 115,832 | | |
Accumulated amortization | | | | | (31,140) | | | | | | — | | | | | | (5,071) | | | | | | — | | | | | | (1,554) | | | | | | (37,765) | | |
Net intangible assets with finite lives | | | | | 74,513 | | | | | | 4,518 | | | | | | (5,071) | | | | | | — | | | | | | 4,107 | | | | | | 78,067 | | |
Intangible assets with indefinite lives | | | | | | | | | | | | | |||||||||||||||||||||||||
Trade names | | | | | 14,683 | | | | | | 580 | | | | | | — | | | | | | (1,560) | | | | | | 739 | | | | | | 14,442 | | |
Intangible assets, net | | | | $ | 89,196 | | | | | $ | 5,098 | | | | | $ | (5,071) | | | | | $ | (1,560) | | | | | $ | 4,846 | | | | | $ | 92,509 | | |
|
2016 | | ||||||||||||||||||||||||||||||||||||
| | | Beginning | | | Additions | | | Amortization | | | Impairment | | | Currency Translation Adjustments | | | Ending | | ||||||||||||||||||
Intangible assets with finite lives | | | | | | | | ||||||||||||||||||||||||||||||
Customer relationships | | | | $ | 103,352 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | 2,301 | | | | | $ | 105,653 | | |
Accumulated amortization | | | | | (25,948) | | | | | | — | | | | | | (4,711) | | | | | | — | | | | | | (481) | | | | | | (31,140) | | |
Net intangible assets with finite lives | | | | | 77,404 | | | | | | — | | | | | | (4,711) | | | | | | — | | | | | | 1,820 | | | | | | 74,513 | | |
Intangible assets with indefinite lives | | | | | | | | | | | | | |||||||||||||||||||||||||
Trade names | | | | | 10,599 | | | | | | 4,096 | | | | | | — | | | | | | (200) | | | | | | 188 | | | | | | 14,683 | | |
Intangible assets, net | | | | $ | 88,003 | | | | | $ | 4,096 | | | | | $ | (4,711) | | | | | $ | (200) | | | | | $ | 2,008 | | | | | $ | 89,196 | | |
|
| | | Amount | | |||
2018 | | | | $ | 5,167 | | |
2019 | | | | | 5,167 | | |
2020 | | | | | 5,167 | | |
2021 | | | | | 5,167 | | |
2022 | | | | | 5,167 | | |
Thereafter | | | | | 52,232 | | |
Total | | | | $ | 78,067 | | |
|
| | | 2017 | | | 2016 | | ||||||
Notes receivable | | | | $ | 289 | | | | | $ | 289 | | |
Deposits | | | | | 558 | | | | | | 1,322 | | |
Samples and displays, net | | | | | 2,481 | | | | | | 2,510 | | |
Insurance receivable | | | | | 1,143 | | | | | | 1,022 | | |
Deferred financing costs, net | | | | | 414 | | | | | | 554 | | |
Other | | | | | 147 | | | | | | — | | |
Total other assets, net | | | | $ | 5,032 | | | | | $ | 5,697 | | |
|
| | | 2017 | | | 2016 | | ||||||
Salaries and payroll taxes | | | | $ | 3,927 | | | | | $ | 3,777 | | |
Advertising allowances and customer rebates | | | | | 4,395 | | | | | | 3,225 | | |
Sales, use and property taxes | | | | | 336 | | | | | | 894 | | |
Warranty, current | | | | | 1,783 | | | | | | 1,312 | | |
Management fees, related party | | | | | — | | | | | | 8,750 | | |
Professional services | | | | | 637 | | | | | | 614 | | |
Restructuring charges | | | | | 162 | | | | | | 559 | | |
Interest | | | | | 3,994 | | | | | | 3,943 | | |
Insurance reserves, current | | | | | 1,880 | | | | | | 2,192 | | |
Unearned revenue, current | | | | | 1,953 | | | | | | 1,305 | | |
Contingent consideration, net | | | | | 1,080 | | | | | | 995 | | |
Income taxes | | | | | 1,001 | | | | | | 470 | | |
Other | | | | | 422 | | | | | | 1,247 | | |
Total accrued liabilities | | | | $ | 21,570 | | | | | $ | 29,283 | | |
|
| | | 2017 | | | 2016 | | ||||||
Warranty | | | | $ | 2,084 | | | | | $ | 2,517 | | |
Unearned revenue | | | | | 1,984 | | | | | | 1,706 | | |
Insurance reserves | | | | | 3,087 | | | | | | 3,860 | | |
Contingent consideration | | | | | — | | | | | | 887 | | |
Legal loss – contingencies | | | | | 380 | | | | | | 750 | | |
Deferred rent | | | | | 380 | | | | | | 252 | | |
Other | | | | | 359 | | | | | | 437 | | |
Total other long-term liabilities | | | | $ | 8,274 | | | | | $ | 10,409 | | |
|
| Present value of purchase price: | | | |||||
| Cash paid | | | | $ | 9,036 | | |
| Total purchase price | | | | $ | 9,036 | | |
| Fair value of assets acquired: | | | | | | | |
| Working capital | | | | $ | 75 | | |
| Fixed assets | | | | | 591 | | |
| Customer relationships | | | | | 4,518 | | |
| Trade name | | | | | 580 | | |
| Goodwill | | | | | 3,272 | | |
| Total fair value of assets acquired | | | | $ | 9,036 | | |
|
| Present value of purchase price: | | | | | | | |
| Cash paid | | | | $ | 6,703 | | |
| Contingent payable | | | | | 1,882 | | |
| Working capital adjustment | | | | | 827 | | |
| Total purchase price | | | | $ | 9,412 | | |
| Fair value of assets acquired: | | | | | | | |
| Accounts receivable | | | | $ | 1,186 | | |
| Inventories | | | | | 675 | | |
| Deposits and prepaid | | | | | 118 | | |
| Property, plant and equipment | | | | | 167 | | |
| Trade name | | | | | 4,096 | | |
| Goodwill | | | | | 4,103 | | |
| Accounts payable | | | | | (290) | | |
| Customer deposits | | | | | (643) | | |
| Total fair value of assets acquired | | | | $ | 9,412 | | |
|
| | | 2017 | | | 2016 | | ||||||
Senior secured asset based revolving credit facility | | | | $ | — | | | | | $ | 275 | | |
Senior Secured Notes, including net unamortized discount and deferred financing costs of $3,133 and $5,483, respectively | | | | | 301,867 | | | | | | 299,517 | | |
Related party notes, including paid-in-kind interest of $27,326 and $18,371 respectively | | | | | 77,326 | | | | | | 68,371 | | |
Other long-term payable | | | | | 50 | | | | | | — | | |
Capital lease obligations | | | | | 99 | | | | | | 38 | | |
Total debt | | | | | 379,342 | | | | | | 368,201 | | |
Less current portion of long-term debt: | | | | | | | | | | | | | |
Senior secured asset based revolving credit facility | | | | | — | | | | | | (275) | | |
Other long-term payable | | | | | (10) | | | | | | — | | |
Capital lease obligations | | | | | (32) | | | | | | (12) | | |
Current portion of long-term debt | | | | | (42) | | | | | | (287) | | |
Long-term debt | | | | $ | 379,300 | | | | | $ | 367,914 | | |
|
| 2018 | | | | $ | 1,292 | | |
| 2019 | | | | | 383,118 | | |
| 2020 | | | | | 36 | | |
| 2021 | | | | | 22 | | |
| 2022 | | | | | 7 | | |
| Thereafter | | | | | — | | |
| Total | | | | $ | 384,475 | | |
|
| | | 2017 | | | 2016 | |||||
Deferred income tax assets: | | | | | | | | | | | |
Accounts receivable allowance | | | | $ | 97 | | | | | $ | 299 |
Inventory cost capitalization and valuation | | | | | 226 | | | | | | 675 |
Accrued vacation and bonuses | | | | | 157 | | | | | | 267 |
Other accrued liabilities | | | | | 519 | | | | | | 978 |
Currency translation adjustment | | | | | 384 | | | | | | 344 |
Warranty | | | | | 1,049 | | | | | | 426 |
Workers’ compensation | | | | | 90 | | | | | | 359 |
Alternative minimum tax carryforwards and other | | | | | 319 | | | | | | 384 |
Related party interest | | | | | 6,386 | | | | | | 6,981 |
Net operating loss carryforwards | | | | | 128,248 | | | | | | 202,625 |
Total deferred income tax assets | | | | | 137,475 | | | | | | 213,338 |
Valuation allowance | | | | | (130,306) | | | | | | (204,817) |
Net deferred income tax assets | | | | | 7,169 | | | | | | 8,521 |
Deferred income tax liabilities: | | | | | | | | | | | |
Fixed and intangible assets | | | | | (24,314) | | | | | | (26,558) |
Total deferred income tax liabilities | | | | | (24,314) | | | | | | (26,558) |
Net deferred income taxes | | | | | (17,145) | | | | | | (18,037) |
Non-current deferred income tax liabilities | | | | $ | (17,145) | | | | | $ | (18,037) |
|
| | | 2017 | | | 2016 | | ||||||
Federal income tax provision (benefit): | | | | | | | | | | | | | |
Current | | | | $ | 45 | | | | | $ | — | | |
Deferred | | | | | (797) | | | | | | — | | |
State income tax provision (benefit): | | | | | | | | | | | | | |
Current | | | | | 177 | | | | | | 47 | | |
Deferred | | | | | 28 | | | | | | (228) | | |
Foreign income tax provision (benefit): | | | | | | | | | | | | | |
Current | | | | | 3,405 | | | | | | 2,308 | | |
Deferred | | | | | (1,337) | | | | | | (807) | | |
Income tax expense | | | | $ | 1,521 | | | | | $ | 1,320 | | |
|
| | | 2017 | | | 2016 | | ||||||
Tax benefit computed at statutory rate | | | | $ | 926 | | | | | $ | (5,313) | | |
State taxes, net of federal tax effects | | | | | 205 | | | | | | (181) | | |
Foreign rate difference | | | | | (795) | | | | | | (640) | | |
Impact of federal US rate change | | | | | (792) | | | | | | — | | |
Valuation allowance | | | | | 245 | | | | | | 5,966 | | |
Other permanent differences | | | | | 1,732 | | | | | | 1,488 | | |
Income tax expense | | | | $ | 1,521 | | | | | $ | 1,320 | | |
|
| | | | | | | | | Operating Leases | | | ||||||||||||||
| | | Capital Leases | | | Vehicle, Office and Warehouse Equipment | | | Facility and Real Property | | | Total | | ||||||||||||
2018 | | | | $ | 32 | | | | | $ | 811 | | | | | $ | 5,477 | | | | | $ | 6,320 | | |
2019 | | | | | 32 | | | | | | 594 | | | | | | 5,351 | | | | | | 5,977 | | |
2020 | | | | | 25 | | | | | | 469 | | | | | | 5,182 | | | | | | 5,676 | | |
2021 | | | | | 10 | | | | | | 421 | | | | | | 4,537 | | | | | | 4,968 | | |
2022 | | | | | — | | | | | | 420 | | | | | | 1,673 | | | | | | 2,093 | | |
Thereafter | | | | | — | | | | | | 2,111 | | | | | | 7,973 | | | | | | 10,084 | | |
Total | | | | $ | 99 | | | | | $ | 4,826 | | | | | $ | 30,193 | | | | | $ | 35,118 | | |
|
| | | 2017 | | | 2016 | | ||||||
Franchise tax | | | | $ | 378 | | | | | $ | 401 | | |
Other (income) expense | | | | | (152) | | | | | | 145 | | |
Total expense, net | | | | $ | 226 | | | | | $ | 546 | | |
|
| | | 2017 | | | 2016 | | ||||||
Assets: | | | | | | | | | | | | | |
Accounts receivable, net | | | | $ | 15 | | | | | $ | 251 | | |
Prepaid expenses and other current assets | | | | | 48 | | | | | | 69 | | |
Other long-term assets, net | | | | | — | | | | | | 4 | | |
Assets of discontinued operations | | | | $ | 63 | | | | | $ | 324 | | |
Liabilities: | | | | | | | | | | | | | |
Current portion of long-term debt | | | | $ | 1,250 | | | | | $ | 1,500 | | |
Accounts payable | | | | | 20 | | | | | | 8 | | |
Accrued liabilities | | | | | 500 | | | | | | 1,091 | | |
Current liabilities of discontinued operations | | | | | 1,770 | | | | | | 2,599 | | |
Long-term debt, net of current | | | | | 722 | | | | | | 1,939 | | |
Long-term liabilities of discontinued operations | | | | | 722 | | | | | | 1,939 | | |
Liabilities of discontinued operations | | | | $ | 2,492 | | | | | $ | 4,538 | | ��� |
|
| | | 2017 | | | 2016 | | ||||||
Net Sales | | | | $ | — | | | | | $ | 45,913 | | |
Loss on disposal | | | | $ | — | | | | | $ | 5,783 | | |
Loss before income taxes | | | | | 1,148 | | | | | | 3,354 | | |
Income tax expense | | | | | — | | | | | | (964) | | |
Loss from discontinued operations | | | | $ | 1,148 | | | | | $ | 8,173 | | |
Depreciation | | | | $ | — | | | | | $ | 1,069 | | |
Amortization | | | | $ | — | | | | | $ | 18 | | |
(dollars in thousands) | | | 2016 | | | 2017 | | ||||||||||||||||||
Net Sales | | | | $ | 312,628 | | | | | | 100.0% | | | | | $ | 348,844 | | | | | | 100.0% | | |
Cost of Goods Sold | | | | | 214,688 | | | | | | 68.7% | | | | | | 234,451 | | | | | | 67.2% | | |
Gross profit | | | | | 97,940 | | | | | | 31.3% | | | | | | 114,393 | | | | | | 32.8% | | |
Operating Expenses: | | | | | | ||||||||||||||||||||
Selling, delivery, general and administrative expenses | | | | | 63,364 | | | | | | 20.3% | | | | | | 67,572 | | | | | | 19.4% | | |
Amortization expense | | | | | 6,231 | | | | | | 2.0% | | | | | | 6,723 | | | | | | 1.9% | | |
Stock compensation expense | | | | | 11 | | | | | | 0.0% | | | | | | 1 | | | | | | 0.0% | | |
Total selling, delivery, general and administrative expenses | | | | | 69,606 | | | | | | 22.3% | | | | | | 74,296 | | | | | | 21.3% | | |
Impairment of trade names | | | | | 200 | | | | | | 0.1% | | | | | | 1,560 | | | | | | 0.4% | | |
(Gain) loss on disposal of assets, net | | | | | 288 | | | | | | 0.1% | | | | | | (239) | | | | | | (0.1%) | | |
Total operating expenses | | | | | 70,094 | | | | | | 22.4% | | | | | | 75,617 | | | | | | 21.7% | | |
Operating Income from Continuing Operations | | | | | 27,846 | | | | | | 8.9% | | | | | | 38,776 | | | | | | 11.1% | | |
Interest expense | | | | | 42,479 | | | | | | 13.6% | | | | | | 35,903 | | | | | | 10.3% | | |
Other expense, net | | | | | 546 | | | | | | 0.2% | | | | | | 226 | | | | | | 0.1% | | |
Income (Loss) from Continuing Operations before Taxes | | | | | (15,179) | | | | | | (4.9%) | | | | | | 2,647 | | | | | | 0.8% | | |
Income tax expense | | | | | 1,320 | | | | | | 0.4% | | | | | | 1,521 | | | | | | 0.4% | | |
Income (Loss) from Continuing Operations | | | | | (16,499) | | | | | | (5.3%) | | | | | | 1,126 | | | | | | 0.3% | | |
Loss from discontinued operations, net of tax | | | | | (8,173) | | | | | | (2.6%) | | | | | | (1,148) | | | | | | (0.3%) | | |
Net Loss | | | | | (24,672) | | | | | | (7.9%) | | | | | | (22) | | | | | | 0.0% | | |
|
(dollars in thousands) | | | 2015 | | | 2016 | | ||||||||||||||||||
Net Sales | | | | $ | 300,453 | | | | | | 100.0% | | | | | $ | 312,628 | | | | | | 100.0% | | |
Cost of Goods Sold | | | | | 201,015 | | | | | | 66.9% | | | | | | 214,688 | | | | | | 68.7% | | |
Gross profit | | | | | 99,438 | | | | | | 33.1% | | | | | | 97,940 | | | | | | 31.3% | | |
Operating Expenses: | | | | | | ||||||||||||||||||||
Selling, delivery, general and administrative expenses | | | | | 63,841 | | | | | | 21.2% | | | | | | 63,364 | | | | | | 20.3% | | |
Amortization expense | | | | | 6,432 | | | | | | 2.1% | | | | | | 6,231 | | | | | | 2.0% | | |
Stock compensation expense | | | | | 11 | | | | | | 0.0% | | | | | | 11 | | | | | | 0.0% | | |
Total selling, delivery, general and administrative expenses | | | | | 70,284 | | | | | | 23.4% | | | | | | 69,606 | | | | | | 22.3% | | |
Impairment of trade name | | | | | 300 | | | | | | 0.1% | | | | | | 200 | | | | | | 0.1% | | |
Loss on disposal of assets, net | | | | | 6 | | | | | | 0.0% | | | | | | 288 | | | | | | 0.1% | | |
Total operating expenses | | | | | 70,590 | | | | | | 23.5% | | | | | | 70,094 | | | | | | 22.4% | | |
Operating Income from Continuing Operations | | | | | 28,848 | | | | | | 9.6% | | | | | | 27,846 | | | | | | 8.9% | | |
Interest expense | | | | | 39,804 | | | | | | 13.2% | | | | | | 42,479 | | | | | | 13.6% | | |
Other expense (income), net | | | | | (519) | | | | | | (0.2%) | | | | | | 546 | | | | | | 0.2% | | |
Loss from Continuing Operations before Income Taxes | | | | | (10,437) | | | | | | (3.5%) | | | | | | (15,179) | | | | | | (4.9%) | | |
Income tax expense | | | | | 2,229 | | | | | | 0.7% | | | | | | 1,320 | | | | | | 0.4% | | |
Loss from Continuing Operations | | | | | (12,666) | | | | | | (4.2%) | | | | | | (16,499) | | | | | | (5.3%) | | |
Loss from discontinued operations, net of tax | | | | | (13,402) | | | | | | (4.5%) | | | | | | (8,173) | | | | | | (2.6%) | | |
Net Loss | | | | | (26,068) | | | | | | (8.7%) | | | | | | (24,672) | | | | | | (7.9%) | | |
|
(dollars in thousands) | | | 2015 | | | 2016 | | | 2017 | | |||||||||
Net cash flows provided by operating activities | | | | $ | 9,385 | | | | | $ | 14,241 | | | | | $ | 11,255 | | |
Net cash flows used in investing activities | | | | | (6,480) | | | | | | (2,994) | | | | | | (15,869) | | |
Net cash flows provided by (used in) financing activities | | | | | (3,915) | | | | | | (9,426) | | | | | | 5,492 | | |
Effect of exchange rate changes | | | | | (209) | | | | | | (66) | | | | | | 347 | | |
Total increase (decrease) in cash and cash equivalents | | | | $ | (1,219) | | | | | $ | 1,755 | | | | | $ | 1,225 | | |
(dollars in thousands) | | | Total | | | Less Than 1 Year | | | 1 – 3 Years | | | 3 – 5 Years | | | More Than 5 Years | | |||||||||||||||
Long-term debt obligations | | | | $ | 307,051 | | | | | $ | 1,260 | | | | | $ | 305,772 | | | | | $ | 19 | | | | | $ | — | | |
Cash interest(1) | | | | | 35,576 | | | | | | 23,692 | | | | | | 11,884 | | | | | | — | | | | | | — | | |
Capital lease obligations | | | | | 99 | | | | | | 32 | | | | | | 57 | | | | | | 10 | | | | | | — | | |
Operating lease obligations | | | | | 35,019 | | | | | | 6,288 | | | | | | 11,596 | | | | | | 7,051 | | | | | | 10,084 | | |
Purchase obligations(2) | | | | | 140,858 | | | | | | 23,826 | | | | | | 47,453 | | | | | | 46,386 | | | | | | 23,193 | | |
Other long-term liabilities reflected on the balance sheet(3) | | | | | 12,448 | | | | | | 4,456 | | | | | | 5,552 | | | | | | 1,647 | | | | | | 793 | | |
Total | | | | $ | 531,051 | | | | | $ | 59,554 | | | | | $ | 382,314 | | | | | $ | 55,113 | | | | | $ | 34,070 | | |
|
| | | 2016 | | | 2015 | | ||||||
ASSETS | | | | | | | | | | | | | |
CURRENT ASSETS: | | | | | | | | | | | | | |
Cash and cash equivalents | | | | $ | 1,810 | | | | | $ | 55 | | |
Restricted cash | | | | | 100 | | | | | | 100 | | |
Accounts receivable, net of allowance for doubtful accounts of $237 and $228, respectively | | | | | 24,997 | | | | | | 20,107 | | |
Inventories, net | | | | | 16,656 | | | | | | 14,898 | | |
Prepaid expenses and other current assets | | | | | 3,480 | | | | | | 4,422 | | |
Assets of discontinued operations | | | | | 324 | | | | | | 26,004 | | |
Total current assets | | | | | 47,367 | | | | | | 65,586 | | |
LONG-TERM ASSETS: | | | | | | | | | | | | | |
Property, plant and equipment, net | | | | | 29,692 | | | | | | 29,472 | | |
Goodwill | | | | | 31,492 | | | | | | 26,734 | | |
Intangible assets, net | | | | | 89,196 | | | | | | 88,003 | | |
Other assets, net | | | | | 5,697 | | | | | | 5,034 | | |
Total long-term assets | | | | | 156,077 | | | | | | 149,243 | | |
Total assets | | | | $ | 203,444 | | | | | $ | 214,829 | | |
LIABILITIES AND STOCKHOLDERS’ DEFICIT | | | | | | | | | | | | | |
CURRENT LIABILITIES: | | | | | | | | | | | | | |
Current portion of long-term debt | | | | $ | 287 | | | | | $ | 91 | | |
Accounts payable | | | | | 16,030 | | | | | | 14,368 | | |
Accrued liabilities | | | | | 29,283 | | | | | | 22,361 | | |
Liabilities of discontinued operations | | | | | 2,599 | | | | | | 7,564 | | |
Total current liabilities | | | | | 48,199 | | | | | | 44,384 | | |
LONG-TERM LIABILITIES: | | | | | | | | | | | | | |
Long-term debt, net of current | | | | | 299,543 | | | | | | 311,814 | | |
Long-term debt due to related party | | | | | 68,371 | | | | | | 53,556 | | |
Long-term liabilities of discontinued operations | | | | | 1,939 | | | | | | 3,645 | | |
Deferred tax liabilities | | | | | 18,037 | | | | | | 19,523 | | |
Other long-term liabilities | | | | | 10,409 | | | | | | 9,781 | | |
Total long-term liabilities | | | | | 398,299 | | | | | | 398,319 | | |
Total liabilities | | | | | 446,498 | | | | | | 442,703 | | |
COMMITMENTS AND CONTINGENCIES | | | | | | | | | | | | | |
STOCKHOLDERS’ DEFICIT: | | | | | | | | | | | | | |
Series A Preferred stock $.01 par value, 600,000 shares authorized, 321,494 shares issued and outstanding | | | | | 2 | | | | | | 2 | | |
Series B Preferred stock $0.01 par and 10,000 shares issued and outstanding | | | | | — | | | | | | — | | |
Common stock $.01 par value, 3,000,000 shares authorized 2,009,964 shares issued and outstanding | | | | | 20 | | | | | | 20 | | |
Paid-in capital | | | | | 240,005 | | | | | | 232,994 | | |
Accumulated deficit | | | | | (453,593) | | | | | | (428,921) | | |
Accumulated other comprehensive income (loss) | | | | | (29,488) | | | | | | (31,969) | | |
Total stockholders’ deficit | | | | | (243,054) | | | | | | (227,874) | | |
Total liabilities and stockholders’ deficit | | | | $ | 203,444 | | | | | $ | 214,829 | | |
|
| | | 2016 | | | 2015 | | ||||||
NET SALES | | | | $ | 312,628 | | | | | $ | 300,453 | | |
COST OF GOODS SOLD | | | | | 214,688 | | | | | | 201,015 | | |
Gross profit | | | | | 97,940 | | | | | | 99,438 | | |
OPERATING EXPENSES: | | | | | | | | | | | | | |
Selling, delivery, general and administrative expenses | | | | | 63,364 | | | | | | 63,841 | | |
Amortization expense | | | | | 6,231 | | | | | | 6,432 | | |
Stock compensation expense | | | | | 11 | | | | | | 11 | | |
Total selling, delivery, general and administrative expenses | | | | | 69,606 | | | | | | 70,284 | | |
Impairment of goodwill and other intangible assets | | | | | 200 | | | | | | 300 | | |
Loss on disposal of assets, net | | | | | 288 | | | | | | 6 | | |
Total operating expenses | | | | | 70,094 | | | | | | 70,590 | | |
OPERATING INCOME FROM CONTINUING OPERATIONS | | | | | 27,846 | | | | | | 28,848 | | |
Interest expense | | | | | 42,479 | | | | | | 39,804 | | |
Other expense (income), net | | | | | 546 | | | | | | (519) | | |
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | | | | | (15,179) | | | | | | (10,437) | | |
Income tax expense | | | | | 1,320 | | | | | | 2,229 | | |
LOSS FROM CONTINUING OPERATIONS | | | | | (16,499) | | | | | | (12,666) | | |
Loss from discontinued operations, net of tax | | | | | (8,173) | | | | | | (13,402) | | |
NET LOSS | | | | | (24,672) | | | | | | (26,068) | | |
Other comprehensive loss, net of taxes: | | | | | | | | | | | | | |
Foreign currency translation adjustment | | | | | 2,481 | | | | | | (15,729) | | |
Comprehensive loss | | | | $ | (22,191) | | | | | $ | (41,797) | | |
|
| | | Series A Preferred Stock | | | Series B Preferred Stock | | | Common Stock | | | Additional Paid-in Capital | | | Accumulated Deficit | | | Accumulated Other Comprehensive Income (Loss) | | | Total | | |||||||||||||||||||||||||||||||||||||||
| | | Shares | | | Amount | | | Shares | | | Amount | | | Shares | | | Amount | | ||||||||||||||||||||||||||||||||||||||||||
BALANCES, JANUARY 1, 2015 | | | | | 321,494 | | | | | $ | 2 | | | | | | — | | | | | $ | — | | | | | | 2,009,964 | | | | | $ | 20 | | | | | $ | 232,983 | | | | | $ | (402,853) | | | | | $ | (16,240) | | | | | $ | (186,088) | | |
Equity based compensation | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 11 | | | | | | — | | | | | | — | | | | | | 11 | | |
Net loss | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (26,068) | | | | | | — | | | | | | (26,068) | | |
Foreign currency translation gain | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (15,729) | | | | | | (15,729) | | |
BALANCES, DECEMBER 31, 2015 | | | | | 321,494 | | | | | | 2 | | | | | | — | | | | | | — | | | | | | 2,009,964 | | | | | | 20 | | | | | | 232,994 | | | | | | (428,921) | | | | | | (31,969) | | | | | | (227,874) | | |
Equity based compensation | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 11 | | | | | | — | | | | | | — | | | | | | 11 | | |
Issuance preferred stock | | | | | — | | | | | | — | | | | | | 10,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | 7,000 | | | | | | — | | | | | | — | | | | | | 7,000 | | |
Net loss | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (24,672) | | | | | | — | | | | | | (24,672) | | |
Foreign currency translation loss | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 2,481 | | | | | | 2,481 | | |
BALANCES, DECEMBER 31, 2016 | | | | | 321,494 | | | | | $ | 2 | | | | | | 10,000 | | | | | $ | — | | | | | | 2,009,964 | | | | | $ | 20 | | | | | $ | 240,005 | | | | | $ | (453,593) | | | | | $ | (29,488) | | | | | $ | (243,054) | | |
|
| | | 2016 | | | 2015 | | ||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | | | | | | | | | | | | | |
Net loss | | | | $ | (24,672) | | | | | $ | (26,068) | | |
Adjustments to reconcile net loss to net cash used in operating activities: | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 13,776 | | | | | | 15,940 | | |
Amortization of deferred financing costs | | | | | 1,506 | | | | | | 1,654 | | |
Accretion of notes discount | | | | | 8,045 | | | | | | 6,855 | | |
Non-cash interest | | | | | 7,692 | | | | | | 6,504 | | |
Impairment of property, plant and equipment | | | | | — | | | | | | 1,643 | | |
Impairment of goodwill and other intangible assets | | | | | 200 | | | | | | 300 | | |
Loss on sale of divisions | | | | | 5,783 | | | | | | — | | |
Loss (gain) on disposal of assets | | | | | 301 | | | | | | (83) | | |
Non-cash equity based compensation | | | | | 11 | | | | | | 11 | | |
Deferred taxes | | | | | (2,004) | | | | | | 191 | | |
Changes in assets and liabilities | | | | | | | | | | | | | |
Accounts receivable | | | | | (3,748) | | | | | | 7,474 | | |
Inventories | | | | | (1,124) | | | | | | 4,554 | | |
Prepaid expenses and other assets | | | | | 1,414 | | | | | | 2,092 | | |
Other long-term assets | | | | | (68) | | | | | | (6,656) | | |
Accounts payable | | | | | 3,763 | | | | | | (6,833) | | |
Long term vendor payable | | | | | — | | | | | | 1,927 | | |
Accrued and other long-term liabilities | | | | | 3,366 | | | | | | (120) | | |
Net cash provided by operating activities | | | | | 14,241 | | | | | | 9,385 | | |
CASH FLOWS FROM INVESTING ACTIVITIES: | | | | | | | | | | | | | |
Purchases of property, plant, and equipment | | | | | (9,347) | | | | | | (9,068) | | |
Proceeds from sales of assets | | | | | 117 | | | | | | 588 | | |
Proceeds from sale of divisions | | | | | 12,939 | | | | | | 2,000 | | |
Purchase of woindow and door company | | | | | (6,703) | | | | | | — | | |
Net cash used in investing activities | | | | | (2,994) | | | | | | (6,480) | | |
CASH FLOWS FROM FINANCING ACTIVITIES: | | | | | | | | | | | | | |
Borrowings under previous ABL credit facility | | | | | 17,600 | | | | | | 33,628 | | |
Payments on previous ABL credit facility | | | | | (32,200) | | | | | | (35,428) | | |
Borrowings under current ABL credit facility | | | | | 275 | | | | | | — | | |
Proceeds of series B preferred stock issuance | | | | | 7,000 | | | | | | — | | |
Payments on Term Note | | | | | (2,000) | | | | | | (2,000) | | |
Addition to capital leases | | | | | — | | | | | | 36 | | |
Payments on capital leases | | | | | (101) | | | | | | (151) | | |
Net cash used in financing activities | | | | | (9,426) | | | | | | (3,915) | | |
EFFECT OF EXCHANGE RATE CHANGES | | | | | (66) | | | | | | (209) | | |
NET DECREASE IN CASH AND CASH EQUIVALENTS | | | | | 1,755 | | | | | | (1,219) | | |
CASH AND CASH EQUIVALENTS – Beginning of period | | | | | 55 | | | | | | 1,274 | | |
CASH AND CASH EQUIVALENTS – End of period | | | | $ | 1,810 | | | | | $ | 55 | | |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | | | | | | | | | | | | | |
Cash paid for: | | | | | | | | | | | | | |
Interest | | | | $ | 23,918 | | | | | $ | 24,726 | | |
Income taxes | | | | $ | 2,087 | | | | | $ | 1,352 | | |
Non-cash investing activities: | | | | | | | | | | | | | |
Purchase of intangibles and goodwill through the Term Note | | | | $ | 1,882 | | | | | $ | — | | |
Purchases of property, plant and equipment | | | | $ | 334 | | | | | $ | 769 | | |
|
| | | Estimated Useful Life | |
Buildings and improvements | | | 20 – 30 years | |
Machinery and equipment | | | 3 – 10 years | |
Software implementation costs | | | 3 years | |
| | | 2016 | | | 2015 | | ||||||
Beginning reserve for warranties | | | | $ | (3,267) | | | | | $ | (4,635) | | |
Change in provision | | | | | (5,169) | | | | | | (2,411) | | |
Settlements | | | | | 4,607 | | | | | | 3,779 | | |
Ending reserve for warranties | | | | $ | (3,829) | | | | | $ | (3,267) | | |
|
| | | 2016 | | | 2015 | | ||||||
Beginning deferred revenue | | | | $ | (1,813) | | | | | $ | (1,309) | | |
Sales | | | | | (1,214) | | | | | | (970) | | |
Amortization | | | | | 697 | | | | | | 466 | | |
Ending deferred revenue | | | | $ | (2,330) | | | | | $ | (1,813) | | |
|
| | | 2016 | | | 2015 | | ||||||
Raw materials | | | | $ | 13,422 | | | | | $ | 11,052 | | |
Work in process | | | | | 244 | | | | | | 239 | | |
Finished goods | | | | | 2,990 | | | | | | 3,607 | | |
Total | | | | $ | 16,656 | | | | | $ | 14,898 | | |
|
| | | 2016 | | | 2015 | | ||||||
Land | | | | $ | 596 | | | | | $ | 578 | | |
Buildings and leasehold improvements | | | | | 10,089 | | | | | | 8,953 | | |
Machinery and equipment | | | | | 58,258 | | | | | | 52,485 | | |
Internally developed software | | | | | 2,684 | | | | | | 1,946 | | |
Construction-in-process | | | | | 1,374 | | | | | | 2,963 | | |
Total | | | | | 73,001 | | | | | | 66,925 | | |
Less accumulated depreciation | | | | | (43,309) | | | | | | (37,453) | | |
Net property, plant and equipment | | | | $ | 29,692 | | | | | $ | 29,472 | | |
|
| | | 2016 | | | 2015 | | ||||||
Hardware | | | | | 449 | | | | | | 449 | | |
Machinery and equipment | | | | | 29 | | | | | | 29 | | |
Office equipment | | | | | 55 | | | | | | 45 | | |
Total | | | | | 533 | | | | | | 523 | | |
Less accumulated depreciation | | | | | (490) | | | | | | (479) | | |
Net capital lease assets | | | | $ | 43 | | | | | $ | 44 | | |
|
| Balance, December 31, 2014 | | | | $ | 30,834 | | |
| Foreign currency translation adjustments | | | | | (4,100) | | |
| Balance, December 31, 2015 | | | | | 26,734 | | |
| Foreign currency translation adjustments | | | | | 655 | | |
| Goodwill on acquisition of window and door company | | | | | 4,103 | | |
| Balance, December 31, 2016 | | | | $ | 31,492 | | |
|
2016 | | ||||||||||||||||||||||||||||||||||||
| | | Beginning | | | Additions | | | Amortization | | | Impairment | | | Currency Translation Adjustments | | | Ending | | ||||||||||||||||||
Intangible assets with finite lives | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Customer relationships | | | | $ | 103,352 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | 2,301 | | | | | $ | 105,653 | | |
Accumulated amortization | | | | | (25,948) | | | | | | — | | | | | | (4,711) | | | | | | — | | | | | | (481) | | | | | | (31,140) | | |
Net intangible assets with finite lives | | | | | 77,404 | | | | | | — | | | | | | (4,711) | | | | | | — | | | | | | 1,820 | | | | | | 74,513 | | |
Intangible assets with indefinite lives Trade names | | | | | 10,599 | | | | | | 4,096 | | | | | | — | | | | | | (200) | | | | | | 188 | | | | | | 14,683 | | |
Intangible assets, net | | | | $ | 88,003 | | | | | $ | 4,096 | | | | | $ | (4,711) | | | | | $ | (200) | | | | | $ | 2,008 | | | | | $ | 89,196 | | |
|
2015 | | ||||||||||||||||||||||||||||||||||||
| | | Beginning | | | Additions | | | Amortization | | | Impairment | | | Currency Translation Adjustments | | | Ending | | ||||||||||||||||||
Intangible assets with finite lives | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Customer relationships | | | | $ | 117,747 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | (14,395) | | | | | $ | 103,352 | | |
Accumulated amortization | | | | | (24,056) | | | | | | — | | | | | | (4,829) | | | | | | — | | | | | | 2,937 | | | | | | (25,948) | | |
Net intangible assets with finite lives | | | | | 93,691 | | | | | | — | | | | | | (4,829) | | | | | | — | | | | | | (11,458) | | | | | | 77,404 | | |
Intangible assets with indefinite lives Trade names | | | | | 12,077 | | | | | | — | | | | | | — | | | | | | (300) | | | | | | (1,178) | | | | | | 10,599 | | |
Intangible assets, net | | | | $ | 105,768 | | | | | $ | — | | | | | $ | (4,829) | | | | | $ | (300) | | | | | $ | (12,636) | | | | | $ | 88,003 | | |
|
| 2017 | | | | $ | 4,829 | | |
| 2018 | | | | | 4,829 | | |
| 2019 | | | | | 4,829 | | |
| 2020 | | | | | 4,829 | | |
| 2021 | | | | | 4,829 | | |
| Thereafter | | | | | 50,368 | | |
| Total | | | | $ | 74,513 | | |
|
| | | 2016 | | | 2015 | | ||||||
Warranty | | | | $ | 2,517 | | | | | $ | 2,393 | | |
Unearned revenue | | | | | 1,706 | | | | | | 1,547 | | |
Insurance reserves | | | | | 3,860 | | | | | | 4,060 | | |
Contingent consideration | | | | | 887 | | | | | | — | | |
Legal loss-contingencies | | | | | 750 | | | | | | 1,500 | | |
Deferred rent | | | | | 252 | | | | | | 108 | | |
Other | | | | | 437 | | | | | | 173 | | |
Total other long-term liabilities | | | | $ | 10,409 | | | | | $ | 9,781 | | |
|
| | | 2016 | | | 2015 | | ||||||
Notes receivable | | | | $ | 289 | | | | | $ | 289 | | |
Deposits | | | | | 1,322 | | | | | | 1,049 | | |
Samples and displays, net | | | | | 2,510 | | | | | | 2,098 | | |
Insurance receivable | | | | | 1,022 | | | | | | 1,008 | | |
Deferred financing costs, net | | | | | 554 | | | | | | 580 | | |
Other | | | | | — | | | | | | 10 | | |
Total other assets, net | | | | $ | 5,697 | | | | | $ | 5,034 | | |
|
| Present value of purchase price: | | | | | | | |
| Cash paid | | | | $ | 6,703 | | |
| Contingent payable | | | | | 1,882 | | |
| Working capital adjustment | | | | | 827 | | |
| Total purchase price | | | | $ | 9,412 | | |
| Fair value of assets acquired: | | | | | | | |
| Accounts receivable | | | | $ | 1,186 | | |
| Inventories | | | | | 675 | | |
| Deposits and prepaid | | | | | 118 | | |
| Property, plant and equipment | | | | | 167 | | |
| Trade name | | | | | 4,096 | | |
| Goodwill | | | | | 4,103 | | |
| Accounts payable | | | | | (290) | | |
| Customer deposits | | | | | (643) | | |
| Total fair value of assets acquired: | | | | $ | 9,412 | | |
|
| | | 2016 | | | 2015 | | ||||||
Senior secured asset based revolving credit facility | | | | $ | 275 | | | | | $ | 14,600 | | |
Senior Secured Notes, including net unamortized discount and deffered financing costs of $5,483 and $4,932, respectively | | | | | 299,517 | | | | | | 297,168 | | |
Related party notes, including paid-in-kind interest of $18,371 and $10,679 respectively, and net of unamortized discount of $0 and $7,123, respectively | | | | | 68,371 | | | | | | 53,556 | | |
Capital lease obligations | | | | | 38 | | | | | | 137 | | |
Total debt | | | | | 368,201 | | | | | | 365,461 | | |
Less current portion of long-term debt: | | | | | | | | | | | | | |
Senior secured asset based revolving credit facility | | | | | (275) | | | | | | — | | |
Capital lease obligations | | | | | (12) | | | | | | (91) | | |
Current portion of long-term debt | | | | | (287) | | | | | | (91) | | |
Long-term debt | | | | $ | 367,914 | | | | | $ | 365,370 | | |
|
| 2017 | | | | $ | 1,512 | | |
| 2018 | | | | | 1,258 | | |
| 2019 | | | | | 374,129 | | |
| 2020 | | | | | 8 | | |
| 2021 | | | | | 277 | | |
| Thereafter | | | | | — | | |
| Total | | | | $ | 377,184 | | |
|
| | | 2016 | | | 2015 | | ||||||
Salaries and payroll taxes | | | | $ | 3,777 | | | | | $ | 4,281 | | |
Advertising allowances and customer rebates | | | | | 3,225 | | | | | | 1,464 | | |
Sales, use and property taxes | | | | | 894 | | | | | | 270 | | |
Warranty, current | | | | | 1,312 | | | | | | 874 | | |
Management fees, related party | | | | | 8,750 | | | | | | 7,000 | | |
Professional services | | | | | 614 | | | | | | 709 | | |
Restructuring charges | | | | | 559 | | | | | | 23 | | |
Interest | | | | | 3,943 | | | | | | 4,216 | | |
Insurance reserves, current | | | | | 2,192 | | | | | | 2,374 | | |
Unearned revenue, current | | | | | 1,305 | | | | | | 480 | | |
Contingent consideration, net | | | | | 995 | | | | | | — | | |
Income taxes | | | | | 470 | | | | | | 456 | | |
Other | | | | | 1,247 | | | | | | 214 | | |
Total accrued liabilities | | | | $ | 29,283 | | | | | $ | 22,361 | | |
|
| | | 2016 | | | 2015 | |||||
Deferred income tax assets: | | | | | | | | | | | |
Accounts receivable allowance | | | | $ | 299 | | | | | $ | 550 |
Inventory cost capitalization and valuation | | | | | 675 | | | | | | 1,067 |
Accrued vacation and bonuses | | | | | 267 | | | | | | 1,000 |
Other accrued liabilities | | | | | 978 | | | | | | 805 |
Currency translation adjustment | | | | | 344 | | | | | | 346 |
Warranty | | | | | 426 | | | | | | 1,529 |
Workers’ compensation | | | | | 359 | | | | | | 152 |
Alternative minimum tax carryforwards and other | | | | | 372 | | | | | | 373 |
Related party interest | | | | | 6,981 | | | | | | 4,058 |
Forward contract | | | | | 12 | | | | | | — |
Net operating loss carryforwards | | | | | 202,625 | | | | | | 195,127 |
Total deferred income tax assets | | | | | 213,338 | | | | | | 205,007 |
Valuation allowance | | | | | (204,817) | | | | | | (197,370) |
Net deferred income tax assets | | | | | 8,521 | | | | | | 7,637 |
Deferred income tax liabilities: | | | | | | | | | | | |
Fixed and intangible assets | | | | | (26,558) | | | | | | (27,160) |
Total deferred income tax liabilities | | | | | (26,558) | | | | | | (27,160) |
Net deferred income taxes | | | | $ | (18,037) | | | | | $ | (19,523) |
|
| | | 2016 | | | 2015 | | ||||||
Federal income tax provision (benefit): | | | | | | | | | | | | | |
Current | | | | $ | — | | | | | $ | — | | |
Deferred | | | | | — | | | | | | 309 | | |
State income tax provision (benefit): | | | | | | | | | | | | | |
Current | | | | | 47 | | | | | | 134 | | |
Deferred | | | | | (228) | | | | | | 770 | | |
Foreign income tax provision (benefit): | | | | | | | | | | | | | |
Current | | | | | 2,308 | | | | | | 1,839 | | |
Deferred | | | | | (807) | | | | | | (823) | | |
Income tax expense | | | | $ | 1,320 | | | | | $ | 2,229 | | |
|
| | | 2016 | | | 2015 | | ||||||
Tax benefit computed at statutory rate | | | | $ | (5,313) | | | | | $ | (3,658) | | |
State taxes, net of federal tax effects | | | | | (181) | | | | | | 857 | | |
Foreign rate difference | | | | | (640) | | | | | | (407) | | |
Valuation allowance | | | | | 5,966 | | | | | | 7,495 | | |
Other permanent differences | | | | | 1,488 | | | | | | (2,058) | | |
Income tax expense | | | | $ | 1,320 | | | | | $ | 2,229 | | |
|
| | | | | | | | | Operating Leases | | | ||||||||||||||
| | | Capital Leases | | | Vehicle, Office and Warehouse Equipment | | | Facility and Real Property | | | Total | | ||||||||||||
2017 | | | | $ | 12 | | | | | $ | 1,036 | | | | | $ | 5,676 | | | | | $ | 6,724 | | |
2018 | | | | | 8 | | | | | | 765 | | | | | | 4,994 | | | | | | 5,767 | | |
2019 | | | | | 8 | | | | | | 460 | | | | | | 4,914 | | | | | | 5,382 | | |
2020 | | | | | 8 | | | | | | 385 | | | | | | 4,927 | | | | | | 5,320 | | |
2021 | | | | | 2 | | | | | | 349 | | | | | | 4,426 | | | | | | 4,777 | | |
Thereafter | | | | | — | | | | | | 1,871 | | | | | | 9,595 | | | | | | 11,466 | | |
Total | | | | $ | 38 | | | | | $ | 4,866 | | | | | $ | 34,532 | | | | | $ | 39,436 | | |
|
| | | 2016 | | | 2015 | | ||||||
Franchise tax | | | | $ | 401 | | | | | $ | 173 | | |
Legal settlement, net of expenses | | | | | — | | | | | | (992) | | |
Other | | | | | 145 | | | | | | 300 | | |
Total expense (income), net | | | | $ | 546 | | | | | $ | (519) | | |
|
| | | 2016 | | | 2015 | | ||||||
Assets: | | | | | | | | | | | | | |
Accounts receivable, net | | | | $ | 251 | | | | | $ | 8,736 | | |
Inventories, net | | | | | — | | | | | | 6,444 | | |
Prepaid expenses and other current assets | | | | | 69 | | | | | | 643 | | |
Property, plant and equipment, net | | | | | — | | | | | | 6,015 | | |
Goodwill | | | | | — | | | | | | 2,663 | | |
Intangible assets, net | | | | | — | | | | | | 1,154 | | |
Other long-term assets, net | | | | | 4 | | | | | | 349 | | |
Assets of discontinued operations | | | | $ | 324 | | | | | $ | 26,004 | | |
Liabilities: | | | | | | | | | | | | | |
Current portion of long-term debt | | | | $ | 1,500 | | | | | $ | 2,000 | | |
Accounts payable | | | | | 8 | | | | | | 2,125 | | |
Accrued liabilities | | | | | 1,091 | | | | | | 3,439 | | |
Current liabilities of discontinued operations | | | | | 2,599 | | | | | | 7,564 | | |
Long-term debt, net of current | | | | | 1,939 | | | | | | 3,386 | | |
Other long-term liabilities | | | | | — | | | | | | 259 | | |
Long-term liabilities of discontinued operations | | | | | 1,939 | | | | | | 3,645 | | |
Liabilities of discontinued operations | | | | $ | 4,538 | | | | | $ | 11,209 | | |
|
| | | 2016 | | | 2015 | | ||||||
Net Sales | | | | $ | 45,913 | | | | | $ | 105,383 | | |
Loss on disposal | | | | $ | 5,783 | | | | | $ | 897 | | |
Loss before income taxes | | | | | 3,354 | | | | | | 12,482 | | |
Income tax (benefit)/expense | | | | | (964) | | | | | | 23 | | |
Loss from discontinued operations | | | | $ | 8,173 | | | | | $ | 13,402 | | |
Depreciation | | | | $ | 1,069 | | | | | $ | 2,398 | | |
Amortization | | | | $ | 18 | | | | | $ | 286 | | |
| | | March 31, 2018 | | | December 31, 2017 | | ||||||
ASSETS | | ||||||||||||
CURRENT ASSETS: | | | | | | | | | | | | | |
Cash and cash equivalents | | | | $ | 5,785 | | | | | $ | 3,035 | | |
Restricted cash | | | | | 99 | | | | | | 100 | | |
Accounts receivable, net of allowance for doubtful accounts of $392 and $373, respectively | | | | | 26,379 | | | | | | 27,081 | | |
Inventories | | | | | 19,309 | | | | | | 15,765 | | |
Prepaid expenses and other current assets | | | | | 3,671 | | | | | | 3,873 | | |
Assets of discontinued operations | | | | | 48 | | | | | | 63 | | |
Total current assets | | | | | 55,291 | | | | | | 49,917 | | |
LONG-TERM ASSETS: | | | | | | | | | | | | | |
Property, plant and equipment, net | | | | | 28,339 | | | | | | 29,392 | | |
Goodwill | | | | | 35,936 | | | | | | 36,780 | | |
Intangible assets, net | | | | | 89,274 | | | | | | 92,509 | | |
Other assets, net | | | | | 4,850 | | | | | | 5,032 | | |
Total long-term assets | | | | | 158,399 | | | | | | 163,713 | | |
Total assets | | | | $ | 213,690 | | | | | $ | 213,630 | | |
LIABILITIES AND STOCKHOLDERS’ DEFICIT | | ||||||||||||
CURRENT LIABILITIES: | | | | | | | | | | | | | |
Current portion of long-term debt | | | | $ | 42 | | | | | $ | 42 | | |
Accounts payable | | | | | 13,702 | | | | | | 12,389 | | |
Accrued liabilities | | | | | 26,894 | | | | | | 21,570 | | |
Liabilities of discontinued operations | | | | | 1,680 | | | | | | 1,770 | | |
Total current liabilities | | | | | 42,318 | | | | | | 35,771 | | |
LONG-TERM LIABILITIES: | | | | | | | | | | | | | |
Long-term debt, net of current | | | | | 302,549 | | | | | | 301,974 | | |
Long-term debt due to related party | | | | | 79,709 | | | | | | 77,326 | | |
Long-term liabilities of discontinued operations | | | | | 728 | | | | | | 722 | | |
Deferred tax liabilities | | | | | 16,223 | | | | | | 17,145 | | |
Other long-term liabilities | | | | | 8,641 | | | | | | 8,274 | | |
Total long-term liabilities | | | | | 407,850 | | | | | | 405,441 | | |
Total liabilities | | | | | 450,168 | | | | | | 441,212 | | |
COMMITMENTS AND CONTINGENCIES | | | | | | | | | | | | | |
STOCKHOLDERS’ DEFICIT: | | | | | | | | | | | | | |
Series A Preferred stock $.01 par value, 600,000 shares authorized, 321,494 shares issued and outstanding | | | | | 2 | | | | | | 2 | | |
Series B Preferred stock $0.01 par and 22,141 shares issued and outstanding | | | | | — | | | | | | — | | |
Common stock $.01 par value, 3,000,000 shares authorized 2,009,964 shares issued and outstanding | | | | | 20 | | | | | | 20 | | |
Paid-in capital | | | | | 248,505 | | | | | | 248,505 | | |
Accumulated deficit | | | | | (459,618) | | | | | | (453,615) | | |
Accumulated other comprehensive loss | | | | | (25,387) | | | | | | (22,494) | | |
Total stockholders’ deficit | | | | | (236,478) | | | | | | (227,582) | | |
Total liabilities and stockholders’ deficit | | | | $ | 213,690 | | | | | $ | 213,630 | | |
|
| | | March 31, 2018 | | | March 31, 2017 | |||||
NET SALES | | | | $ | 72,369 | | | | | $ | 69,465 |
COST OF GOODS SOLD | | | | | 50,873 | | | | | | 49,304 |
Gross profit | | | | | 21,496 | | | | | | 20,161 |
OPERATING EXPENSES: | | | | | | | | | | | |
Selling, delivery, general and administrative expenses | | | | | 16,694 | | | | | | 16,499 |
Amortization expense | | | | | 1,722 | | | | | | 1,588 |
Total selling, delivery, general and administrative expenses | | | | | 18,416 | | | | | | 18,087 |
Gain on disposal of assets, net | | | | | — | | | | | | (201) |
Total operating expenses | | | | | 18,416 | | | | | | 17,886 |
OPERATING INCOME FROM CONTINUING OPERATIONS | | | | | 3,080 | | | | | | 2,275 |
Interest expense | | | | | 9,050 | | | | | | 8,852 |
Other expense, net | | | | | 61 | | | | | | 64 |
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | | | | | (6,031) | | | | | | (6,641) |
Income tax expense (benefit) | | | | | (464) | | | | | | 120 |
LOSS FROM CONTINUING OPERATIONS | | | | | (5,567) | | | | | | (6,761) |
Loss from discontinued operations, net of tax | | | | | (436) | | | | | | (241) |
NET LOSS | | | | | (6,003) | | | | | | (7,002) |
Other comprehensive (loss) income, net of taxes: | | | | | | | | | | | |
Foreign currency translation adjustment | | | | | (2,893) | | | | | | 656 |
Comprehensive loss | | | | $ | (8,896) | | | | | $ | (6,346) |
|
| | | March 31, 2018 | | | March 31, 2017 | | ||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | | | | | | | | | | | | | |
Net loss | | | | $ | (6,003) | | | | | $ | (7,002) | | |
Adjustments to reconcile net loss to net cash provided by operating activities: | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 3,361 | | | | | | 3,207 | | |
Amortization of deferred financing costs | | | | | 414 | | | | | | 380 | | |
Accretion of notes discount | | | | | 223 | | | | | | 226 | | |
Non-cash interest | | | | | 2,383 | | | | | | 2,128 | | |
Gain on disposal of assets | | | | | — | | | | | | (201) | | |
Deferred taxes | | | | | (489) | | | | | | — | | |
Changes in assets and liabilities: | | | | | | | | | | | | | |
Accounts receivable | | | | | 609 | | | | | | (1,632) | | |
Inventories | | | | | (3,710) | | | | | | (1,650) | | |
Prepaid expenses and other assets | | | | | 164 | | | | | | 173 | | |
Other long-term assets | | | | | 26 | | | | | | 653 | | |
Accounts payable | | | | | 1,434 | | | | | | (219) | | |
Accrued and other long-term liabilities | | | | | 5,787 | | | | | | 6,481 | | |
Net cash provided by operating activities | | | | | 4,199 | | | | | | 2,544 | | |
CASH FLOWS FROM INVESTING ACTIVITIES: | | | | | | | | | | | | | |
Purchases of property, plant, and equipment | | | | | (1,339) | | | | | | (2,794) | | |
Proceeds from sales of assets | | | | | — | | | | | | 268 | | |
Purchase of entry door company | | | | | — | | | | | | (9,036) | | |
Net cash used in investing activities | | | | | (1,339) | | | | | | (11,562) | | |
CASH FLOWS FROM FINANCING ACTIVITIES: | | | | | | | | | | | | | |
Borrowings under ABL Credit Facility | | | | | — | | | | | | 5,058 | | |
Payments under ABL Credit Facility | | | | | — | | | | | | (3,050) | | |
Proceeds from capital contributions | | | | | — | | | | | | 6,700 | | |
Payments on capital leases | | | | | (8) | | | | | | (3) | | |
Net cash (used in) provided by financing activities | | | | | (8) | | | | | | 8,705 | | |
EFFECT OF EXCHANGE RATE CHANGES | | | | | (102) | | | | | | (75) | | |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | | | | | 2,750 | | | | | | (388) | | |
CASH AND CASH EQUIVALENTS – Beginning of period | | | | | 3,035 | | | | | | 1,810 | | |
CASH AND CASH EQUIVALENTS – End of period | | | | $ | 5,785 | | | | | $ | 1,422 | | |
|
| | | 31-Mar-18 | | | 31-Dec-17 | | ||||||
Raw materials | | | | $ | 14,705 | | | | | $ | 12,906 | | |
Work in process | | | | | 449 | | | | | | 336 | | |
Finished goods | | | | | 4,155 | | | | | | 2,523 | | |
Total | | | | $ | 19,309 | | | | | $ | 15,765 | | |
|
| | | 31-Mar-18 | | | 31-Dec-17 | | ||||||
Land | | | | $ | 620 | | | | | $ | 638 | | |
Buildings and leasehold improvements | | | | | 11,797 | | | | | | 11,799 | | |
Machinery and equipment | | | | | 63,486 | | | | | | 63,420 | | |
Internally developed software | | | | | 2,859 | | | | | | 2,688 | | |
Construction-in-process | | | | | 1,160 | | | | | | 1,059 | | |
Total | | | | | 79,922 | | | | | | 79,604 | | |
Less accumulated depreciation | | | | | (51,583) | | | | | | (50,212) | | |
Net property, plant and equipment | | | | $ | 28,339 | | | | | $ | 29,392 | | |
|
| | | 31-Mar-18 | | | 31-Dec-17 | | ||||||
Hardware | | | | $ | 449 | | | | | $ | 449 | | |
Vehicles | | | | | 86 | | | | | | 88 | | |
Machinery and equipment | | | | | 29 | | | | | | 29 | | |
Office equipment | | | | | 42 | | | | | | 44 | | |
Total | | | | | 606 | | | | | | 610 | | |
Less accumulated depreciation | | | | | (524) | | | | | | (527) | | |
Net capital lease assets | | | | $ | 82 | | | | | $ | 83 | | |
|
| | | Goodwill | | |||
Balance, December 31, 2017 | | | | $ | 36,780 | | |
Foreign currency translation adjustments | | | | | (844) | | |
Balance, March 31, 2018 | | | | $ | 35,936 | | |
|
| | 31-Dec-17 | | Additions | | Amortization | | Currency Translation Adjustments | | 31-Mar-18 | | | 31-Dec-17 | | Additions | | Amortization | | Currency Translation Adjustments | | 31-Mar-18 | | ||||||||||||||||||||||||||||||||||||||||
Intangible assets with finite lives | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||||
Customer relationships | | | $ | 115,832 | | | | $ | — | | | | $ | — | | | | $ | (2,348) | | | | $ | 113,484 | | | | | $ | 115,832 | | | | $ | — | | | | $ | — | | | | $ | (2,348) | | | | $ | 113,484 | | | ||||||||||
Accumulated amortization | | �� | | | (37,765) | | | | | — | | | | | (1,314) | | | | | 706 | | | | | (38,373) | | | | | | (37,765) | | | | | — | | | | | (1,314) | | | | | 706 | | | | | (38,373) | | | |||||||||
Net intangible assets with finite lives | | | | 78,067 | | | | | — | | | | | (1,314) | | | | | (1,642) | | | | | 75,111 | | | | | | 78,067 | | | | | — | | | | | (1,314) | | | | | (1,642) | | | | | 75,111 | | | ||||||||||
Intangible assets with indefinite lives | | | | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Trade names | | | | 14,442 | | | | | — | | | | | — | | | | | (279) | | | | | 14,163 | | | | | | 14,442 | | | | | — | | | | | — | | | | | (279) | | | | | 14,163 | | | ||||||||||
Intangible assets, net | | | $ | 92,509 | | | | $ | — | | | | $ | (1,314) | | | | $ | (1,921) | | | | $ | 89,274 | | | | | $ | 92,509 | | | | $ | — | | | | $ | (1,314) | | | | $ | (1,921) | | | | $ | 89,274 | | | |
| | | For the Three Months Ended | | |||||||||
| | | 31-Mar-18 | | | 31-Mar-17 | | ||||||
Net loss | | | | $ | (6,003) | | | | | $ | (7,002) | | |
Foreign currency translation (loss) gain | | | | | (2,893) | | | | | | 656 | | |
Comprehensive loss | | | | $ | (8,896) | | | | | $ | (6,346) | | |
|
| | | 31-Mar-18 | | | 31-Dec-17 | | ||||||
Salaries and payroll taxes | | | | $ | 5,763 | | | | | $ | 3,927 | | |
Advertising allowances and customer rebates | | | | | 2,281 | | | | | | 4,395 | | |
Sales, use and property taxes | | | | | 397 | | | | | | 336 | | |
Warranty, current | | | | | 1,760 | | | | | | 1,783 | | |
Management fees, related party | | | | | 438 | | | | | | — | | |
Professional services | | | | | 347 | | | | | | 637 | | |
Restructuring charges | | | | | 73 | | | | | | 162 | | |
Interest | | | | | 9,902 | | | | | | 3,994 | | |
Insurance reserves, current | | | | | 1,994 | | | | | | 1,880 | | |
Unearned revenue, current | | | | | 1,933 | | | | | | 1,953 | | |
Contingent consideration, net | | | | | 1,077 | | | | | | 1,080 | | |
Income taxes | | | | | 565 | | | | | | 1,001 | | |
Other | | | | | 364 | | | | | | 422 | | |
Total accrued liabilities | | | | $ | 26,894 | | | | | $ | 21,570 | | |
|
| | | 31-Mar-18 | | | 31-Dec-17 | | ||||||
Senior Secured Notes, including net unamortized discount and deferred financing fees of $2,546 and $3,133 respectively | | | | $ | 302,454 | | | | | $ | 301,867 | | |
Related party notes, including paid-in-kind interest of $29,709 and $27,326 respectively | | | | | 79,709 | | | | | | 77,326 | | |
Other long term payable | | | | | 48 | | | | | | 50 | | |
Capital lease obligations | | | | | 89 | | | | | | 99 | | |
Total debt | | | | | 382,300 | | | | | | 379,342 | | |
Less current portion of long-term debt: | | | | ||||||||||
Other long term payable | | | | | (10) | | | | | | (10) | | |
Capital lease obligations | | | | | (32) | | | | | | (32) | | |
Current portion of long-term debt | | | | | (42) | | | | | | (42) | | |
Long-term debt | | | | $ | 382,258 | | | | | $ | 379,300 | | |
|
| April 2018 – March 2019 | | | | $ | 1,282 | | |
| April 2019 – March 2020 | | | | | 385,488 | | |
| April 2020 – March 2021 | | | | | 21 | | |
| April 2021 – March 2022 | | | | | 7 | | |
| Total | | | | $ | 386,798 | | |
|
| | | Capital Leases | | | Operating Leases | | | Total | | |||||||||||||||
| | | Vehicle, Office and Warehouse Equipment | | | Facility and Real Property | | ||||||||||||||||||
Apr 2018 – Mar 2019 | | | | $ | 32 | | | | | $ | 748 | | | | | $ | 5,575 | | | | | $ | 6,355 | | |
Apr 2019 – Mar 2020 | | | | | 29 | | | | | | 577 | | | | | | 5,418 | | | | | | 6,024 | | |
Apr 2020 – Mar 2021 | | | | | 21 | | | | | | 472 | | | | | | 5,132 | | | | | | 5,625 | | |
Apr 2021 – Mar 2022 | | | | | 7 | | | | | | 434 | | | | | | 3,901 | | | | | | 4,342 | | |
Apr 2022 – Mar 2023 | | | | | — | | | | | | 433 | | | | | | 1,659 | | | | | | 2,092 | | |
Thereafter | | | | | — | | | | | | 1,021 | | | | | | 7,568 | | | | | | 8,589 | | |
Total | | | | $ | 89 | | | | | $ | 3,685 | | | | | $ | 29,253 | | | | | $ | 33,027 | | |
|
| | | 31-Mar-18 | | | 31-Dec-17 | | ||||||
Assets: | | | | | | | | | | | | | |
Accounts receivable, net | | | | $ | — | | | | | $ | 15 | | |
Prepaid expenses and other current assets | | | | | 48 | | | | | | 48 | | |
Assets of discontinued operations | | | | $ | 48 | | | | | $ | 63 | | |
Liabilities: | | | | | | | | | | | | | |
Current portion of long-term debt | | | | $ | 1,250 | | | | | $ | 1,250 | | |
Accounts payable | | | | | 4 | | | | | | 20 | | |
Accrued liabilities | | | | | 426 | | | | | | 500 | | |
Liabilities of discontinued operations | | | | | 1,680 | | | | | | 1,770 | | |
Long-term debt, net of current | | | | | 728 | | | | | | 722 | | |
Long-term liabilities of discontinued operations | | | | | 728 | | | | | | 722 | | |
Liabilities of discontinued operations | | | | $ | 2,408 | | | | | $ | 2,492 | | |
|
| | | For the Three Months Ended | | |||||||||
| | | 31-Mar-18 | | | 31-Mar-17 | | ||||||
Net sales | | | | $ | — | | | | | $ | — | | |
Loss before income taxes | | | | $ | (436) | | | | | $ | (241) | | |
Income tax expense | | | | | — | | | | | | — | | |
Loss from discontinued operations | | | | $ | (436) | | | | | $ | (241) | | |
Depreciation | | | | $ | — | | | | | $ | — | | |
Amortization | | | | $ | — | | | | | $ | — | | |
| Present value of purchase price: | | | | | | | |
| Cash paid | | | | $ | 9,036 | | |
| Total purchase price | | | | $ | 9,036 | | |
| Fair value of assets acquired: | | | | | | | |
| Working capital | | | | $ | 75 | | |
| Fixed assets | | | | | 591 | | |
| Customer relationships | | | | | 4,518 | | |
| Trade name | | | | | 580 | | |
| Goodwill | | | | | 3,272 | | |
| Total fair value of assets acquired | | | | $ | 9,036 | | |
|
| | | (Unaudited) | | |||||||||||||||||||||
| | | 31-Mar-18 | | | 31-Mar-17 | | ||||||||||||||||||
NET SALES | | | | $ | 72,369 | | | | | | 100.0% | | | | | $ | 69,465 | | | | | | 100.0% | | |
COST OF GOODS SOLD | | | | | 50,873 | | | | | | 70.3% | | | | | | 49,304 | | | | | | 71.0% | | |
Gross profit | | | | | 21,496 | | | | | | 29.7% | | | | | | 20,161 | | | | | | 29.0% | | |
OPERATING EXPENSES: | | | | | | | | | | | | | | | | | | | | | | | | | |
Selling, delivery, general and administrative expenses | | | | | 16,694 | | | | | | 23.1% | | | | | | 16,499 | | | | | | 23.8% | | |
Amortization expense | | | | | 1,722 | | | | | | 2.4% | | | | | | 1,588 | | | | | | 2.3% | | |
Total selling, delivery, general and administrative expenses | | | | | 18,416 | | | | | | 25.4% | | | | | | 18,087 | | | | | | 26.0% | | |
Gain on disposal of assets | | | | | — | | | | | | 0.0% | | | | | | (201) | | | | | | -0.3% | | |
Total operating expenses | | | | | 18,416 | | | | | | 25.4% | | | | | | 17,886 | | | | | | 25.7% | | |
OPERATING INCOME FROM CONTINUING OPERATIONS | | | | | 3,080 | | | | | | 4.3% | | | | | | 2,275 | | | | | | 3.3% | | |
Interest expense | | | | | 9,050 | | | | | | 12.5% | | | | | | 8,852 | | | | | | 12.7% | | |
Other expense, net | | | | | 61 | | | | | | 0.1% | | | | | | 64 | | | | | | 0.1% | | |
LOSS FROM CONTINUING OPERATIONS | | | | | | | | | | | | | | | | | | | | | | | | | |
BEFORE INCOME TAXES | | | | | (6,031) | | | | | | -8.3% | | | | | | (6,641) | | | | | | -9.6% | | |
Income tax (benefit) expense | | | | | (464) | | | | | | -0.6% | | | | | | 120 | | | | | | 0.2% | | |
LOSS FROM CONTINUING OPERATIONS | | | | | (5,567) | | | | | | -7.7% | | | | | | (6,761) | | | | | | -9.7% | | |
Loss from discontinued operations, net of tax | | | | | (436) | | | | | | -0.6% | | | | | | (241) | | | | | | -0.3% | | |
NET LOSS | | | | | (6,003) | | | | | | -8.3% | | | | | | (7,002) | | | | | | -10.1% | | |
|
| | | For the Three Months Ended | | |||||||||
| | | 31-Mar-18 | | | 31-Mar-17 | | ||||||
Net loss | | | | $ | (6,003) | | | | | $ | (7,002) | | |
Interest | | | | | 9,077 | | | | | | 8,861 | | |
Taxes | | | | | (464) | | | | | | 120 | | |
Depreciation and amortization | | | | | 3,361 | | | | | | 3,207 | | |
Reported EBITDA | | | | $ | 5,971 | | | | | $ | 5,186 | | |
Discontinued Operations(a) | | | | | 409 | | | | | | 233 | | |
Transaction, Management and Board fees(b) | | | | | 831 | | | | | | 811 | | |
Restructuring/Severance Expenses(c) | | | | | — | | | | | | 714 | | |
Foreign Currency and Asset Sale (Gain)/Loss(d) | | | | | (64) | | | | | | (133) | | |
Other(e) | | | | | 132 | | | | | | 171 | | |
Adjusted EBITDA | | | | $ | 7,279 | | | | | $ | 6,982 | | |
Pro Forma Impact of G&A Restructuring and acquisitions(f) | | | | | — | | | | | | 492 | | |
Impact of Extrusion Insourcing and Contracted Resin Savings(g) | | | | | 274 | | | | | | 524 | | |
Pro Forma Adjustments | | | | $ | 274 | | | | | $ | 1,016 | | |
Pro Forma Adjusted EBITDA | | | | $ | 7,553 | | | | | $ | 7,998 | | |
|
| | | 31-Mar-18 | | | 31-Mar-17 | | ||||||
Net cash flows provided by operating activities | | | | $ | 4,199 | | | | | $ | 2,544 | | |
Net cash flowzs used in investing activities | | | | | (1,339) | | | | | | (11,562) | | |
Net cash flows (used in) provided by financing activities | | | | | (8) | | | | | | 8,705 | | |
Effect of exchange rate changes | | | | | (102) | | | | | | (75) | | |
Total increase (decrease) in cash and cash equivalents | | | | $ | 2,750 | | | | | $ | (388) | | |
|
| | | Page | | |||
| | | | A-1 | | | |
| | | | A-1 | | | |
| | | | A-2 | | | |
| | | | A-2 | | | |
| | | | A-2 | | | |
| | | | A-2 | | | |
| | | | A-2 | | | |
| | | | A-2 | | | |
| | | | A-2 | | | |
| | | | A-3 | | | |
| | | | A-3 | | | |
| | | | A-3 | | | |
| | | | A-3 | | | |
| | | | A-3 | | | |
| | | | A-4 | | | |
| | | | A-4 | | | |
| | | | A-4 | | | |
| | | | A-5 | | | |
| | | | A-5 | | | |
| | | | A-6 | | | |
| | | | A-6 | | | |
| | | | A-7 | | | |
| | | | A-7 | | | |
| | | | A-8 | | | |
| | | | A-9 | | | |
| | | | A-10 | | | |
| | | | A-11 | | | |
| | | | A-11 | | | |
| | | | A-11 | | | |
| | | | A-12 | | | |
| | | | A-14 | | | |
| | | | A-14 | | | |
| | | | A-14 | | | |
| | | | A-15 | | | |
| | | | A-15 | | | |
| | | | A-15 | | | |
| | | | A-15 | | |
| | | Page | | |||
| | | | A-15 | | | |
| | | | A-15 | | | |
| | | | A-15 | | | |
| | | | A-16 | | | |
| | | | A-16 | | | |
| | | | A-16 | | | |
| | | | A-16 | | | |
| | | | A-17 | | | |
| | | | A-17 | | | |
| | | | A-18 | | | |
| | | | A-18 | | | |
| | | | A-19 | | | |
| | | | A-19 | | | |
| | | | A-20 | | | |
| | | | A-21 | | | |
| | | | A-21 | | | |
| | | | A-23 | | | |
| | | | A-23 | | | |
| | | | A-23 | | | |
| | | | A-24 | | | |
| | | | A-26 | | | |
| | | | A-26 | | | |
| | | | A-26 | | | |
| | | | A-26 | | | |
| | | | A-26 | | | |
| | | | A-26 | | | |
| | | | A-27 | | | |
| | | | A-27 | | | |
| | | | A-27 | | | |
| | | | A-27 | | | |
| | | | A-30 | | | |
| | | | A-32 | | | |
| | | | A-32 | | | |
| | | | A-35 | | | |
| | | | A-35 | | | |
| | | | A-36 | | | |
| | | | A-36 | | | |
| | | | A-38 | | | |
| | | | A-38 | | |
| | | Page | | |||
| | | | A-38 | | | |
| | | | A-39 | | | |
| | | | A-41 | | | |
| | | | A-41 | | | |
| | | | A-41 | | | |
| | | | A-41 | | | |
| | | | A-41 | | | |
| | | | A-42 | | | |
| | | | A-42 | | | |
| | | | A-42 | | | |
| | | | A-42 | | | |
| | | | A-43 | | | |
| | | | A-43 | | | |
| | | | A-44 | | | |
| | | | A-44 | | | |
| | | | A-45 | | | |
| | | | A-45 | | | |
| | | | A-46 | | | |
| | | | A-46 | | | |
| | | | A-46 | | | |
| | | | A-55 | | | |
| | | | A-55 | | | |
| | | | A-55 | | | |
| | | | A-55 | | | |
| | | | A-57 | | | |
| | | | A-57 | | | |
| | | | A-57 | | | |
| | | | A-57 | | | |
| | | | A-57 | | | |
| | | | A-57 | | | |
| | | | A-58 | | | |
| | | | A-59 | | | |
| | | | A-59 | | | |
| | | | A-59 | | | |
| | | | A-59 | | | |
| | | | A-59 | | |
| Exhibits | | | ||
| Exhibit A | | | Form of Certificate of Incorporation | |
| Exhibit B | | | Form of Bylaws | |
| Exhibit C | | | Form of Stockholders Agreement | |
| Exhibit D | | | Form of Registration Rights Agreement | |
| Schedules | | | ||
| Schedule I | | | Surviving Corporation Board | |
| Schedule II | | | Senior Management | |
| Schedule III | | | Percentage Interests of Holders | |
| Schedule IV | | | Recused Directors | |
| | | | PLY GEM PARENT, LLC | |
| | | | By: /s/ Gary E. Robinette Name: Gary E. Robinette Title: Chief Executive Officer | |
| | | | Clayton, Dubilier & Rice, LLC solely for the purposes of Sections 6.1(e), 6.5(a)(i), 6.5(a)(ii), 6.5(a)(iv), 6.5(b) and 6.5(c). | |
| | | | By: /s/ Theresa A. Gore Name: Theresa A. Gore Title: Vice President, Treasurer and Assistant Secretary | |
| | | | NCI BUILDING SYSTEMS, INC. | |
| | | | By: /s/ Todd R. Moore Name: Todd R. Moore Title: EVP & General Counsel | |
| | | Page | | |||
ARTICLE I DEFINITIONS | | | |||||
| | | | B-1 | | | |
ARTICLE II REPRESENTATIONS AND WARRANTIES | | | |||||
| | | | B-9 | | | |
| | | | B-10 | | | |
| | | | B-10 | | | |
ARTICLE III GOVERNANCE MATTERS; VOTING; STANDSTILL PROVISIONS | | | |||||
| | | | B-10 | | | |
| | | | B-15 | | | |
| | | | B-15 | | | |
ARTICLE IV TRANSFER AND HEDGING RESTRICTIONS | | | |||||
| | | | B-16 | | | |
| | | | B-18 | | | |
ARTICLE V SUBSCRIPTION RIGHTS | | | |||||
| | | | B-18 | | | |
| | | | B-18 | | | |
| | | | B-19 | | | |
| | | | B-20 | | | |
| | | | B-21 | | | |
| | | | B-21 | | | |
| | | | B-21 | | | |
| | | | B-21 | | | |
ARTICLE VI CONSENT RIGHTS | | | |||||
| | | | B-21 | | | |
ARTICLE VII EFFECTIVENESS AND TERMINATION | | | |||||
| | | | B-23 | | | |
ARTICLE VIII ACCESS, INFORMATION AND CONFIDENTIALITY | | | |||||
| | | | B-23 | | | |
| | | | B-24 | | |
| | | Page | | |||
ARTICLE IX MISCELLANEOUS | | | |||||
| | | | B-24 | | | |
| | | | B-24 | | | |
| | | | B-25 | | | |
| | | | B-25 | | | |
| | | | B-26 | | | |
| | | | B-26 | | | |
| | | | B-27 | | | |
| | | | B-27 | | | |
| | | | B-27 | | | |
| | | | B-27 | | | |
| | | | B-28 | | | |
| | | | B-28 | | | |
| | | | B-28 | | | |
| | | | B-28 | | | |
| | | | B-28 | | | |
| | | | B-29 | | |
| Name | | | Class | | | Director Designation | |
| | | Page | | |||
| | | | F-1 | | | |
| | | | F-1 | | | |
| | | | F-1 | | | |
| | | | F-1 | | | |
| | | | F-1 | | | |
| | | | F-1 | | | |
| | | | F-1 | | | |
| | | | F-1 | | | |
| | | | F-1 | | | |
| | | | F-1 | | | |
| | | | F-2 | | | |
| | | | F-2 | | | |
| | | | F-3 | | | |
| | | | F-4 | | | |
| | | | F-4 | | | |
| | | | F-4 | | | |
| | | | F-4 | | | |
| | | | F-4 | | | |
| | | | F-5 | | | |
| | | | F-5 | | | |
| | | | F-7 | | | |
| | | | F-7 | | | |
| | | | F-7 | | | |
| | | | F-7 | | | |
| | | | F-7 | | | |
| | | | F-7 | | | |
| | | | F-8 | | | |
| | | | F-8 | | | |
| | | | F-8 | | | |
| | | | F-8 | | | |
| | | | F-8 | | | |
| | | | F-9 | | | |
| | | | F-9 | | | |
| | | | F-9 | | | |
| | | | F-9 | | | |
| | | | F-9 | | | |
| | | | F-9 | | | |
| | | | F-9 | | | |
| | | | F-9 | | |
| | | Page | | |||
| | | | F-9 | | | |
| | | | F-9 | | | |
| | | | F-10 | | | |
| | | | F-10 | | | |
| | | | F-10 | | | |
| | | | F-10 | | | |
| | | | F-10 | | | |
| | | | F-10 | | | |
| | | | F-11 | | | |
| | | | F-11 | | | |
| | | | F-11 | | | |
| | | | F-11 | | | |
| | | | F-12 | | | |
| | | | F-12 | | | |
| | | | F-12 | | | |
| | | | F-12 | | | |
| | | | F-13 | | | |
| | | | F-13 | | | |
| | | | F-13 | | | |
| | | | F-13 | | | |
| | | | F-13 | | | |
| | | | F-13 | | | |
| | | | F-13 | | | |
| | | | F-13 | | | |
| | | | F-14 | | | |
| | | | F-14 | | | |
| | | | F-14 | | | |
| | | | F-14 | | | |
| | | | F-14 | | | |
| | | | F-15 | | | |
| | | | F-15 | | | |
| | | | F-15 | | | |
| | | | F-15 | | | |
| | | | F-15 | | | |
| | | | F-15 | | | |
| | | | F-15 | | | |
| | | | F-15 | | | |
| | | | F-15 | | | |
| | | | F-15 | | | |
| | | | F-15 | | | |
| | | | F-16 | | |