Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2014 | Apr. 21, 2014 | |
Document And Entity Information [Abstract] | ' | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 31-Mar-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
Entity Registrant Name | 'TREX CO INC | ' |
Entity Central Index Key | '0001069878 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 16,797,224 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $3,729 | $3,772 |
Accounts receivable, net | 116,470 | 37,338 |
Inventories | 30,213 | 22,428 |
Prepaid expenses and other assets | 2,969 | 3,145 |
Deferred income taxes | 9,145 | 9,497 |
Total current assets | 162,526 | 76,180 |
Property, plant, and equipment, net | 100,278 | 100,783 |
Goodwill and other intangibles | 10,539 | 10,542 |
Other assets | 652 | 652 |
Total assets | 273,995 | 188,157 |
Current liabilities: | ' | ' |
Accounts payable | 10,999 | 14,891 |
Accrued expenses | 16,478 | 23,295 |
Accrued warranty | 9,000 | 9,000 |
Line of credit | 80,000 | ' |
Total current liabilities | 116,477 | 47,186 |
Deferred income taxes | 360 | 360 |
Non-current accrued warranty | 29,802 | 31,812 |
Other long-term liabilities | 2,134 | 2,183 |
Total liabilities | 148,773 | 81,541 |
Stockholders' equity: | ' | ' |
Preferred stock, $0.01 par value, 3,000,000 shares authorized; none issued and outstanding | ' | ' |
Common stock, $0.01 par value, 40,000,000 shares authorized; 17,339,036 and 17,299,062 shares issued and 16,777,781 and 16,737,807 shares outstanding at March 31, 2014 and December 31, 2013, respectively | 173 | 173 |
Additional paid-in capital | 107,978 | 101,667 |
Retained earnings | 42,071 | 29,776 |
Treasury stock, at cost, 561,255 shares | -25,000 | -25,000 |
Total stockholders' equity | 125,222 | 106,616 |
Total liabilities and stockholders' equity | $273,995 | $188,157 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Parenthetical) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
Statement Of Financial Position [Abstract] | ' | ' |
Preferred stock, par value | $0.01 | $0.01 |
Preferred stock, shares authorized | 3,000,000 | 3,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $0.01 | $0.01 |
Common stock, shares authorized | 40,000,000 | 40,000,000 |
Common stock, shares issued | 17,339,036 | 17,299,062 |
Common stock, shares outstanding | 16,777,781 | 16,737,807 |
Treasury stock, shares | 561,255 | 561,255 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Comprehensive Income (USD $) | 3 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Income Statement [Abstract] | ' | ' |
Net sales | $100,645 | $107,880 |
Cost of sales | 62,478 | 66,020 |
Gross profit | 38,167 | 41,860 |
Selling, general and administrative expenses | 18,222 | 19,842 |
Income from operations | 19,945 | 22,018 |
Interest expense, net | 323 | 251 |
Income before income taxes | 19,622 | 21,767 |
Provision for income taxes | 7,327 | 198 |
Net income | 12,295 | 21,569 |
Basic earnings per common share | $0.74 | $1.28 |
Basic weighted average common shares outstanding | 16,564,338 | 16,883,111 |
Diluted earnings per common share | $0.73 | $1.25 |
Diluted weighted average common shares outstanding | 16,799,719 | 17,280,445 |
Comprehensive income | $12,295 | $21,569 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Cash Flows (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Operating Activities | ' | ' |
Net income | $12,295 | $21,569 |
Adjustments to reconcile net income to net cash used in operating activities: | ' | ' |
Depreciation and amortization | 3,797 | 4,164 |
Stock-based compensation | 1,170 | 895 |
Deferred income taxes | 352 | -237 |
Gain on disposal of property, plant and equipment | -37 | -67 |
Excess tax benefits from stock compensation | -6,507 | ' |
Changes in operating assets and liabilities: | ' | ' |
Accounts receivable | -79,152 | -90,840 |
Inventories | -7,785 | 2,487 |
Prepaid expenses and other assets | -82 | 850 |
Accounts payable | -3,892 | 1,874 |
Accrued expenses and other liabilities | -9,068 | -7,004 |
Income taxes receivable/payable | 6,884 | 356 |
Net cash used in operating activities | -82,025 | -65,953 |
Investing Activities | ' | ' |
Expenditures for property, plant and equipment | -3,188 | -1,910 |
Proceeds from sales of property, plant and equipment | 37 | 67 |
Purchase of acquired company, net of cash acquired | -44 | ' |
Notes receivable, net | 19 | 31 |
Net cash used in investing activities | -3,176 | -1,812 |
Financing Activities | ' | ' |
Financing costs | ' | -73 |
Borrowings under line of credit | 85,000 | 67,000 |
Principal payments under line of credit | -5,000 | ' |
Repurchases of common stock | -1,433 | -1,996 |
Proceeds from employee stock purchase and option plans | 84 | 2,577 |
Excess tax benefits from stock compensation | 6,507 | ' |
Net cash provided by financing activities | 85,158 | 67,508 |
Net decrease in cash and cash equivalents | -43 | -257 |
Cash and cash equivalents at beginning of period | 3,772 | 2,159 |
Cash and cash equivalents at end of period | 3,729 | 1,902 |
Supplemental Disclosure: | ' | ' |
Cash paid for interest, net of capitalized interest | 99 | 96 |
Cash paid for income taxes, net | $91 | $79 |
Business_and_Organization
Business and Organization | 3 Months Ended |
Mar. 31, 2014 | |
Accounting Policies [Abstract] | ' |
Business and Organization | ' |
1. BUSINESS AND ORGANIZATION | |
Trex Company, Inc. (the “Company”) is the world’s largest manufacturer of wood-alternative decking and railing products, which are marketed under the brand name Trex®. The Company is incorporated in Delaware. The principal executive offices are located at 160 Exeter Drive, Winchester, Virginia 22603, and the telephone number at that address is (540) 542-6300. The Company operates in one business segment. |
Basis_of_Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2014 | |
Accounting Policies [Abstract] | ' |
Basis of Presentation | ' |
2. BASIS OF PRESENTATION | |
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, the accompanying condensed consolidated financial statements do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. In the opinion of management, all adjustments (consisting of normal and recurring adjustments) considered necessary for a fair presentation have been included in the accompanying condensed consolidated financial statements. Certain prior year amounts in the accompanying condensed consolidated financial statements have been reclassified to conform to the current year presentation. The consolidated results of operations for the three months ended March 31, 2014 are not necessarily indicative of the results that may be expected for the full fiscal year. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements as of December 31, 2013 and 2012 and for each of the three years in the period ended December 31, 2013 included in the annual report of Trex Company, Inc. on Form 10-K, as filed with the Securities and Exchange Commission. | |
The Company’s critical accounting policies are included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013. |
Inventories
Inventories | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Inventory Disclosure [Abstract] | ' | ||||||||
Inventories | ' | ||||||||
3. INVENTORIES | |||||||||
Inventories, at LIFO (last-in, first-out) value, consist of the following (in thousands): | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Finished goods | $ | 39,339 | $ | 30,423 | |||||
Raw materials | 15,371 | 16,502 | |||||||
Total FIFO inventories | 54,710 | 46,925 | |||||||
Reserve to adjust inventories to LIFO value | (24,497 | ) | (24,497 | ) | |||||
Total LIFO inventories | $ | 30,213 | $ | 22,428 | |||||
Under the LIFO method, reductions in inventory cause a portion of the Company’s cost of sales to be based on historical costs rather than current year costs. There were no LIFO inventory liquidations in the three months ended March 31, 2014 or 2013. | |||||||||
An actual valuation of inventory under the LIFO method can be made only at the end of each year based on the inventory levels and costs at that time. Accordingly, interim LIFO calculations are based on management’s estimates of expected year-end inventory levels and costs. Since inventory levels and costs are subject to factors beyond management’s control, interim results are subject to the final year-end LIFO inventory valuation. |
Accrued_Expenses
Accrued Expenses | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Payables And Accruals [Abstract] | ' | ||||||||
Accrued Expenses | ' | ||||||||
4. ACCRUED EXPENSES | |||||||||
Accrued expenses consist of the following (in thousands): | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Accrued sales and marketing | $ | 4,157 | $ | 5,269 | |||||
Accrued compensation and benefits | 3,919 | 9,135 | |||||||
Accrued rent obligations | 2,227 | 1,787 | |||||||
Accrued legal contingency | 1,586 | 3,174 | |||||||
Accrued manufacturing expenses | 1,434 | 1,107 | |||||||
Other | 3,155 | 2,823 | |||||||
Total accrued expenses | $ | 16,478 | $ | 23,295 | |||||
Debt
Debt | 3 Months Ended |
Mar. 31, 2014 | |
Debt Disclosure [Abstract] | ' |
Debt | ' |
5. DEBT | |
The Company’s outstanding debt consists of a revolving credit facility. | |
Revolving Credit Facility | |
The Company currently has an Amended Credit Agreement which provides the Company with one or more revolving loans in a collective maximum principal amount of $100 million. On December 17, 2013, the Company entered into a Second Amendment (“Second Amendment”) to the Amended Credit Agreement dated as of January 6, 2012, as amended by the First Amendment dated February 26, 2013 (the “Credit Agreement”). Pursuant to the Second Amendment, the Credit Agreement was amended to temporarily increase the maximum amount of the Revolver Loans from $100 million to $125 million during the period from January 1, 2014 through and including June 30, 2014 to meet seasonal cash requirements. No other material changes were made to the terms of the Credit Agreement. | |
Amounts drawn under the Credit Agreement are subject to a borrowing base consisting of certain accounts receivables, inventories, machinery and equipment and real estate. At March 31, 2014, the Company had $80 million of outstanding borrowings under its revolving credit facility and remaining available borrowing capacity of approximately $45 million. | |
Compliance with Debt Covenants and Restrictions | |
The Company’s ability to make scheduled principal and interest payments and to borrow and repay amounts under any outstanding revolving credit facility, and continue to comply with any loan covenants depends primarily on the Company’s ability to generate sufficient cash flow from operations. | |
As of March 31, 2014, the Company was in compliance with all of the covenants contained in its debt agreements. Failure to comply with the loan covenants might cause lenders to accelerate the repayment obligations under the credit facility, which may be declared payable immediately based on a default. |
Financial_Instruments
Financial Instruments | 3 Months Ended |
Mar. 31, 2014 | |
Investments All Other Investments [Abstract] | ' |
Financial Instruments | ' |
6. FINANCIAL INSTRUMENTS | |
The Company considers the recorded value of its financial assets and liabilities, consisting primarily of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and other current liabilities to approximate the fair value of the respective assets and liabilities at March 31, 2014 and December 31, 2013. |
Stockholders_Equity
Stockholders' Equity | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Equity [Abstract] | ' | ||||||||
Stockholders' Equity | ' | ||||||||
7. STOCKHOLDERS’ EQUITY | |||||||||
Earnings Per Share | |||||||||
The following table sets forth the computation of basic and diluted earnings per share (in thousands, except share and per share data): | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
Numerator: | |||||||||
Net income available to common shareholders | $ | 12,295 | $ | 21,569 | |||||
Denominator: | |||||||||
Basic weighted average shares outstanding | 16,564,338 | 16,883,111 | |||||||
Effect of dilutive securities: | |||||||||
SARs and options | 151,457 | 330,075 | |||||||
Restricted stock | 83,924 | 67,259 | |||||||
Diluted weighted average shares outstanding | 16,799,719 | 17,280,445 | |||||||
Basic earnings per share | $ | 0.74 | $ | 1.28 | |||||
Diluted earnings per share | $ | 0.73 | $ | 1.25 | |||||
Diluted earnings per share is computed using the weighted average number of shares determined for the basic earnings per share computation plus the dilutive effect of common stock equivalents using the treasury stock method. The computation of diluted earnings per share excludes the following potentially dilutive securities because the effect would be anti-dilutive: | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
Restricted stock and stock options | 44 | 32,872 | |||||||
Stock appreciation rights | 598 | 30,753 | |||||||
Stock Repurchase Programs | |||||||||
On October 24, 2013, the Company’s Board of Directors authorized a common stock repurchase program, expiring on February 10, 2014, of up to $30 million of the Company’s outstanding common stock (the “October 2013 Stock Repurchase Program”). The Company made no repurchases under the October 2013 Stock Repurchase Program before it expired. | |||||||||
On February 19, 2014, the Company’s Board of Directors authorized an additional common stock repurchase program of up to $50 million of the Company’s outstanding common stock (the “February 2014 Stock Repurchase Program”). This authorization has no expiration date. During the three months ended March 31, 2014, the Company made no repurchases under the February 2014 Stock Repurchase Program. |
StockBased_Compensation
Stock-Based Compensation | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' | ||||||||
Stock-Based Compensation | ' | ||||||||
8. STOCK-BASED COMPENSATION | |||||||||
As of March 31, 2014, the Company has one stock-based compensation plan, the 2005 Stock Incentive Plan (the “Plan”). The Plan is administered by the Compensation Committee of the Company’s Board of Directors. Stock-based compensation is granted to officers, directors and certain key employees in accordance with the provisions of the Plan. The Plan provides for grants of stock options, stock appreciation rights (“SARs”), restricted stock and performance share awards. As of March 31, 2014, the total aggregate number of shares of the Company’s common stock that may be issued under the Plan is 3,150,000. | |||||||||
In 2014, the Company began granting performance-based restricted stock in addition to the time-based restricted stock it previously granted. The performance-based restricted shares have a three-year vesting period, vesting one-third each year based on target earnings before interest, taxes, depreciation and amortization, or “EBITDA”, for 1 year, cumulative 2 years and cumulative 3 years, respectively. With respect to each vesting, the number of shares that will vest will be between 0% and 200% of the target number of shares. | |||||||||
The fair value of each SAR is estimated on the date of grant using a Black-Scholes option-pricing formula. For SARs issued in the three months ended March 31, 2014 and 2013, respectively, the assumptions shown in the following table were used: | |||||||||
Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
Weighted-average fair value of grants | $ | 37.4 | $ | 23.34 | |||||
Dividend yield | 0 | % | 0 | % | |||||
Average risk-free interest rate | 1.8 | % | 0.7 | % | |||||
Expected term (years) | 5 | 5 | |||||||
Expected volatility | 54 | % | 64 | % | |||||
The following table summarizes the Company’s stock-based compensation grants for the three months ended March 31, 2014: | |||||||||
Stock Awards Granted | Weighted-Average | ||||||||
Grant Price | |||||||||
Per Share | |||||||||
Stock appreciation rights | 1,562 | $ | 78.15 | ||||||
Time-based restricted stock | 27,062 | $ | 67.45 | ||||||
Performance-based restricted stock | 21,338 | $ | 67.43 | ||||||
The Company recognizes stock-based compensation expense ratably over the period from grant date to the earlier of: (1) the vesting date of the award, or (2) the date the grantee is eligible to retire without forfeiting the award. For performance-based restricted stock, expense is recognized ratably over the performance and vesting period of each tranche based on management’s judgment of the ultimate award that is likely to be paid out based on the achievement of the predetermined performance measures. The following table summarizes the Company’s stock-based compensation expense for the three months ended March 31, 2014 and 2013 (in thousands): | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
Stock appreciation rights | $ | 370 | $ | 331 | |||||
Time-based restricted stock | 708 | 537 | |||||||
Performance-based restricted stock | 82 | — | |||||||
Employee stock purchase plan | 10 | 27 | |||||||
Total stock-based compensation | $ | 1,170 | $ | 895 | |||||
Total unrecognized compensation cost related to unvested awards as of March 31, 2014 was $7.2 million. The cost of these unvested awards is being recognized over the requisite vesting period of each award. |
Income_Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2014 | |
Income Tax Disclosure [Abstract] | ' |
Income Taxes | ' |
9. INCOME TAXES | |
As of December 31, 2013, the Company determined that it more likely than not will realize most of its deferred tax assets and, as a result, reversed a significant portion of its valuation allowance. As of March 31, 2014, the Company has a valuation allowance of $4.2 million, primarily related to certain state tax credits the Company estimates will expire before they are realized. The Company analyzes its position in each reporting period, considering all available positive and negative evidence, in determining the expected realization of its deferred tax assets. | |
The Company’s effective tax rate for the three months ended March 31, 2014 and 2013 was 37.3% and 0.9% respectively, which resulted in expense of $7.3 million and $0.2 million, respectively. The lower effective tax rate for the three months ended March 31, 2013 was a direct result of the Company maintaining a full valuation allowance against its deferred tax assets. | |
During the three months ended March 31, 2014, the Company realized $6.5 million of excess tax benefits from stock-based awards and, accordingly, recorded an increase to additional paid-in capital. | |
The Company operates in multiple tax jurisdictions and, in the normal course of business, its tax returns are subject to examination by various taxing authorities. Such examinations may result in future assessments by these taxing authorities, and the Company accrues a liability when it believes that it is more likely than not that benefits of tax positions will not be realized. The Company believes that adequate provisions have been made for all tax returns subject to examination. As of March 31, 2014, federal tax years 2010 through 2013 remain subject to examination, while tax returns in certain state tax jurisdictions for years 2008 through 2013 remain subject to examination. The Company’s returns filed with the state of Michigan for tax years 2008 through 2011 are currently under examination. No material adjustments are expected as a result of the audit. | |
In September 2013, the Internal Revenue Service issued Treasury Decision 9636, which enacted final tax regulations regarding the capitalization and expensing of amounts paid to acquire, produce, or improve tangible property. The regulations also include guidance regarding the retirement of depreciable property. The Company has assessed the impact of the final regulations on its financial statements and does not expect any material adjustments or changes. |
Seasonality
Seasonality | 3 Months Ended |
Mar. 31, 2014 | |
Text Block [Abstract] | ' |
Seasonality | ' |
10. SEASONALITY | |
The Company’s operating results have historically varied from quarter to quarter, often attributable to seasonal trends in the demand for Trex®. The Company has historically experienced lower net sales during the fourth quarter because holidays and adverse weather conditions in certain regions reduce the level of home improvement and construction activity. |
Commitments_and_Contingencies
Commitments and Contingencies | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Commitments And Contingencies Disclosure [Abstract] | ' | ||||||||
Commitments and Contingencies | ' | ||||||||
11. COMMITMENTS AND CONTINGENCIES | |||||||||
Contract Termination Costs | |||||||||
In anticipation of relocating its corporate headquarters, the Company entered into a lease agreement in 2005. The Company reconsidered and decided not to move its headquarters. The lease obligates the Company to lease 55,047 square feet of office space through June 30, 2019. As of March 31, 2014, the Company has executed subleases for 41,701 square feet of the leased space, 16,969 of which expires on December 31, 2014, and is currently marketing the remaining portion of the space to find a suitable tenant. The Company estimates that the present value of the estimated future sublease receipts, net of transaction costs, will be less than the Company’s remaining minimum lease payment obligations under its lease and has recorded a liability for the expected shortfall. During the three months ended March 31, 2014, due primarily to an increase in available commercial office space, the Company revised its estimate of future sublease receipts and recorded a charge of $0.6 million to selling, general and administrative expenses. | |||||||||
To estimate future sublease receipts, the Company has assumed that existing subleases will be renewed or new subleases will be executed at rates consistent with rental rates in the current subleases or estimated market rates. However, management cannot be certain that the timing of future subleases or the rental rates contained in future subleases will not differ from current estimates. Factors such as the availability of commercial office space, poor market conditions and subtenant preferences will influence the terms achieved in future subleases. The inability to sublet the office space in the future or unfavorable changes to key management assumptions used in the estimate of the future sublease receipts may result in material charges to selling, general and administrative expenses in future periods. | |||||||||
As of March 31, 2014, the minimum payments remaining under the Company’s lease relating to its reconsidered corporate relocation over the years ending December 31, 2014, 2015, 2016, 2017 and 2018 are $1.3 million, $1.7 million, $1.8 million, $1.8 million and $1.8 million, respectively, and $0.9 million thereafter. The minimum receipts remaining under the Company’s existing subleases over the years ending December 31, 2014, 2015, 2016, 2017 and 2018 are $1.0 million, $0.8 million, $0.7 million, $0.7 million and $0.7 million, respectively, and $0.4 million thereafter. | |||||||||
The following table provides information about the Company’s liability related to the lease (in thousands): | |||||||||
2014 | 2013 | ||||||||
Beginning balance, January 1 | $ | 1,787 | $ | 1,103 | |||||
Net rental receipts (payments) | (162 | ) | (110 | ) | |||||
Accretion of discount | 35 | 21 | |||||||
Increase in net estimated contract termination costs | 567 | — | |||||||
Ending balance, March 31 | $ | 2,227 | $ | 1,014 | |||||
Product Warranty | |||||||||
The Company warrants that its products will be free from material defects in workmanship and materials. This warranty generally extends for a period of 25 years for residential use and 10 years for commercial use. (With respect to TrexTrim™ and Trex Reveal® Railing, the warranty period is 25 years for both residential and commercial use.) With respect to the Company’s Transcend®, Enhance®, Select® and Universal Fascia product, the Company further warrants that the product will not fade in color more than a certain amount and will be resistant to permanent staining from food substances or mold (provided the stain is cleaned within seven days of appearance). This warranty extends for a period of 25 years for residential use and 10 years for commercial use. If there is a breach of such warranties, the Company has an obligation either to replace the defective product or refund the purchase price. | |||||||||
Historically, the Company has not had material numbers of claims submitted or settled under the provisions of its product warranties, with the exception of claims related to material produced at its Nevada facility prior to 2007 that exhibits surface flaking. The Company continues to receive and settle surface flaking claims and maintains a warranty reserve to provide for the settlement of these claims. Estimating the warranty reserve for surface flaking claims requires management to estimate (1) the number of claims to be settled with payment and (2) the average cost to settle each claim, both of which are subject to variables that are difficult to estimate. | |||||||||
To estimate the number of claims to be settled with payment, the Company utilizes actuarial techniques to quantify both the expected number of claims to be received and the percentage of those claims that will ultimately require payment. Estimates for both of these elements (number and percentage of claims that will ultimately require payment) are quantified using a range of assumptions derived from the recent claim count history and the identification of factors influencing the claim counts, including the downward trend in received claims due to the passage of time since production of the suspect material. For each of the various parameters used in the analysis, the assumed values in the actuarial valuation produce results that represent the Company’s best estimate for the ultimate number of claims to be settled with payment. The cost per claim varies due to a number of factors, including the size of affected decks, the type of replacement material used, the cost of production of replacement material and the method of claim settlement. | |||||||||
The Company monitors surface flaking claims activity each quarter for indications that its estimates require revision. Due to extensive use of decks during the summer outdoor season, variances to annual claims expectations are typically more meaningful during the latter part of the fiscal year. Through the first quarter of 2014, the number of claims received was slightly lower than the Company’s expectations. Average cost per claim was lower than the 2013 quarter but higher than the cost expected for 2014. The Company expects the average cost per claim to decline throughout the year. At March 31, 2014, the Company believes that its reserve is sufficient to cover future surface flaking obligations. | |||||||||
The Company’s analysis is based on currently known facts and a number of assumptions. Projecting future events such as the number of claims to be received, the number of claims that will require payment and the average cost of claims could cause the actual warranty liabilities to be higher or lower than those projected which could materially affect the Company’s financial condition, results of operations or cash flow. The Company estimates that the number of claims received and average cost per claim will continue to decline over time. If the level of claims received or average cost per claim do not diminish as expected, it could result in additional increases to the warranty reserve and reduced earnings and cash flows in future periods. The Company estimates that a 10% change in the expected number of remaining claims to be settled with payment or the expected cost to settle claims may result in approximately a $3.9 million change in the warranty reserve. | |||||||||
The following is a reconciliation of the Company’s warranty reserve (in thousands): | |||||||||
2014 | 2013 | ||||||||
Beginning balance, January 1 | $ | 40,812 | $ | 28,987 | |||||
Changes in estimates related to pre-existing warranties | — | — | |||||||
Settlements made during the period | (2,010 | ) | (1,681 | ) | |||||
Ending balance, March 31 | $ | 38,802 | $ | 27,306 | |||||
Legal Matters | |||||||||
As reported in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013, on January 19, 2009, a purported class action case was commenced against the Company in the Superior Court of California, Santa Cruz County, by the lead law firm of Lieff, Cabraser, Heimann & Bernstein, LLP and certain other law firms (the “Lieff Cabraser Group”) on behalf of Eric Ross and Bradley S. Hureth and similarly situated plaintiffs. These plaintiffs generally alleged certain defects in the Company’s products, and that the Company failed to provide adequate remedies for defective products. On February 13, 2009, the Company removed this case to the United States District Court, Northern District of California. On January 21, 2009, a purported class action case was commenced against the Company in the United States District Court, Western District of Washington by the law firm of Hagens Berman Sobol Shapiro LLP (“Hagens Berman”) on behalf of Mark Okano and similarly situated plaintiffs, generally alleging certain product defects in the Company’s products, and that the Company failed to provide adequate remedies for defective products. This case was transferred by the Washington Court to the California Court as a related case to the Lieff Cabraser Group’s case. | |||||||||
On July 30, 2009, the U.S. District Court for the Northern District of California preliminarily approved a settlement of the claims of the lawsuit commenced by the Lieff Cabraser Group involving surface flaking of the Company’s product, and on March 15, 2010, it granted final approval of the settlement. | |||||||||
On March 25, 2010, the Lieff Cabraser Group amended its complaint to add claims relating to alleged defects in the Company’s products and alleged misrepresentations relating to mold growth. Hagens Berman alleged similar claims in its original complaint. In its Final Order approving the surface flaking settlement, the District Court consolidated these pending actions relating to the mold claims, and appointed Hagens Berman as lead counsel in this case. On December 3, 2010, Hagens Berman filed an amended consolidated complaint in the United States District Court, Northern District of California relating to the mold growth claims (now on behalf of Dean Mahan and other named plaintiffs). | |||||||||
On December 15, 2010, a purported class action case was commenced against the Company in the United States District Court, Western District of Kentucky, by Cohen & Malad, LLP (“Cohen & Malad”) on behalf of Richard Levin and similarly situated plaintiffs in Kentucky, and on June 13, 2011, a purported class action was commenced against the Company in the Marion Circuit/Superior Court of Indiana by Cohen & Malad on behalf of Ellen Kopetsky and similarly situated plaintiffs in Indiana. On June 28, 2011, the Company removed the Kopetsky case to the United States District Court, Southern District of Indiana. (On September 3, 2013, the two lawsuits commenced by Cohen & Malad were settled.) On August 11, 2011, a purported class action was commenced against the Company in the 50 th Circuit Court for the County of Chippewa, Michigan on behalf of Joel and Lori Peffers and similarly situated plaintiffs in Michigan. On August 26, 2011, the Company removed the Peffers case to the United States District Court, Western District of Michigan. (The plaintiffs in the Peffers case voluntarily dismissed the lawsuit on April 11, 2014.) On April 4, 2012, a purported class action was commenced against the Company in Superior Court of New Jersey, Essex County by the lead law firm of Stull, Stull & Brody (the “Stull Group”) on behalf of Caryn Borger, M.D. and similarly situated plaintiffs in New Jersey. On May 1, 2012, the Company removed the Borger case to the United States District Court, District of New Jersey. (On December 5, 2013, the lawsuit commenced by the Stull Group was settled.) The plaintiffs in these purported class actions alleged certain defects in the Company’s products and alleged misrepresentations relating to mold growth. | |||||||||
On April 5, 2013, the Company signed a settlement agreement with Hagens Berman that settled the case pending in the United States District Court, Northern District of California on a nationwide basis, and the parties filed for preliminary approval of such settlement (the “nationwide settlement”). The material terms of the nationwide settlement, as amended by an amended settlement agreement signed on September 3, 2013, are as follows: | |||||||||
• | Trex will make a one-time cash payment or the opportunity to receive other relief, including a rebate certificate on its newer-generation shelled product (Trex Transcend® and Trex Enhance®). This relief would be available for any consumer whose first-generation composite decking product has a certain defined level of mold growth, color fading or color variation. | ||||||||
• | Trex agreed to discontinue the manufacture of non-shelled decking, railing and fencing products (other than Trex Traditional Railing and Trex Seclusions Fencing) by December 31, 2013. | ||||||||
• | Trex agreed to provide a video demonstrating cleaning instructions for non-shelled products on its website, and to distribute warranty pads to retailers. | ||||||||
• | The cost to Trex is capped at $8.25 million plus $1.45 million in attorneys’ fees to be paid to the Plaintiffs’ counsel upon final approval of the nationwide settlement by the Court. | ||||||||
The settlement agreement provides that the nationwide settlement applies to any Trex first-generation non-shelled composite decking, railing and fencing product purchased between August 1, 2004 and August 27, 2013, the date of preliminary approval of the nationwide settlement. | |||||||||
On August 27, 2013, the Court entered an Order granting preliminary approval of the settlement agreement and on December 16, 2013, the Court granted final approval of the settlement. During the three months ended March 31, 2014, the Company paid $1.6 million related to this litigation, representing payment of attorneys’ fees and named plaintiff awards in the nationwide settlement, and the settlements of the Stull Group and Cohen & Malad litigation. At March 31, 2014, the Company has a remaining accrual of $1.6 million related to this litigation. It is reasonably possible that the Company may incur costs in excess of the recorded amounts; however, the Company expects that the total net cost to resolve the lawsuit will not exceed approximately $10 million. | |||||||||
The Company has other lawsuits, as well as other claims, pending against it which are ordinary routine litigation and claims incidental to the business. Management has evaluated the merits of these other lawsuits and claims, and believes that their ultimate resolution will not have a material effect on the Company’s consolidated financial condition, results of operations, liquidity or competitive position. |
Subsequent_Events
Subsequent Events | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Subsequent Events [Abstract] | ' | ||||||||
Subsequent Events | ' | ||||||||
12. SUBSEQUENT EVENTS | |||||||||
On February 19, 2014, the Board of Directors approved a two-for-one stock split of the Company’s common stock, par value $0.01 per share. The stock split will be in the form of a stock dividend to be distributed on May 7, 2014 to stockholders of record at the close of business on April 7, 2014. The stock split entitles each stockholder to receive one additional share of common stock, par value $0.01, for each share they hold as of the record date. Upon completion of the stock split, the Company’s outstanding shares of common stock will increase from approximately 16.8 million shares to approximately 33.6 million shares. Additionally, on April 30, 2014, the Company’s stockholders’ approved an amendment to the Company’s Restated Certificate of Incorporation to increase the number of authorized shares of common stock from 40 million shares to 80 million shares. | |||||||||
All share and per share data presented in the accompanying unaudited condensed consolidated financial statements have not been adjusted for the stock split, but will be retroactively adjusted during the second quarter of 2014. | |||||||||
Pro forma share and per share data, giving retroactive effect to the stock split, are as follows: | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
Weighted average shares outstanding: | |||||||||
Basic weighted average shares outstanding, as reported (pre-stock split) | 16,564,338 | 16,883,111 | |||||||
Basic weighted average shares outstanding, pro forma (post-stock split) | 33,128,676 | 33,766,222 | |||||||
Diluted weighted average shares outstanding, as reported (pre-stock split) | 16,799,719 | 17,280,445 | |||||||
Diluted weighted average shares outstanding, pro forma (post-stock split) | 33,599,438 | 34,560,890 | |||||||
Earnings per common share: | |||||||||
Basic earnings per share, as reported (pre-stock split) | $ | 0.74 | $ | 1.28 | |||||
Basic earnings per share, pro forma (post-stock split) | $ | 0.37 | $ | 0.64 | |||||
Diluted earnings per share, as reported (pre-stock split) | $ | 0.73 | $ | 1.25 | |||||
Diluted earnings per share, pro forma (post-stock split) | $ | 0.37 | $ | 0.62 | |||||
The pro forma impact as a result of the stock split on the Company’s stockholders’ equity is an increase of $0.2 million to common stock and an offsetting reduction in additional paid-in capital. |
StockBased_Compensation_Polici
Stock-Based Compensation (Policies) | 3 Months Ended |
Mar. 31, 2014 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' |
Share-based Compensation | ' |
As of March 31, 2014, the Company has one stock-based compensation plan, the 2005 Stock Incentive Plan (the “Plan”). The Plan is administered by the Compensation Committee of the Company’s Board of Directors. Stock-based compensation is granted to officers, directors and certain key employees in accordance with the provisions of the Plan. The Plan provides for grants of stock options, stock appreciation rights (“SARs”), restricted stock and performance share awards. As of March 31, 2014, the total aggregate number of shares of the Company’s common stock that may be issued under the Plan is 3,150,000. | |
The Company recognizes stock-based compensation expense ratably over the period from grant date to the earlier of: (1) the vesting date of the award, or (2) the date the grantee is eligible to retire without forfeiting the award. For performance-based restricted stock, expense is recognized ratably over the performance and vesting period of each tranche based on management’s judgment of the ultimate award that is likely to be paid out based on the achievement of the predetermined performance measures. | |
Contract Termination Costs | ' |
Contract Termination Costs | |
In anticipation of relocating its corporate headquarters, the Company entered into a lease agreement in 2005. The Company reconsidered and decided not to move its headquarters. The lease obligates the Company to lease 55,047 square feet of office space through June 30, 2019. As of March 31, 2014, the Company has executed subleases for 41,701 square feet of the leased space, 16,969 of which expires on December 31, 2014, and is currently marketing the remaining portion of the space to find a suitable tenant. The Company estimates that the present value of the estimated future sublease receipts, net of transaction costs, will be less than the Company’s remaining minimum lease payment obligations under its lease and has recorded a liability for the expected shortfall. During the three months ended March 31, 2014, due primarily to an increase in available commercial office space, the Company revised its estimate of future sublease receipts and recorded a charge of $0.6 million to selling, general and administrative expenses. | |
To estimate future sublease receipts, the Company has assumed that existing subleases will be renewed or new subleases will be executed at rates consistent with rental rates in the current subleases or estimated market rates. However, management cannot be certain that the timing of future subleases or the rental rates contained in future subleases will not differ from current estimates. Factors such as the availability of commercial office space, poor market conditions and subtenant preferences will influence the terms achieved in future subleases. The inability to sublet the office space in the future or unfavorable changes to key management assumptions used in the estimate of the future sublease receipts may result in material charges to selling, general and administrative expenses in future periods. | |
Product Warranty | ' |
Product Warranty | |
The Company warrants that its products will be free from material defects in workmanship and materials. This warranty generally extends for a period of 25 years for residential use and 10 years for commercial use. (With respect to TrexTrim™ and Trex Reveal® Railing, the warranty period is 25 years for both residential and commercial use.) With respect to the Company’s Transcend®, Enhance®, Select® and Universal Fascia product, the Company further warrants that the product will not fade in color more than a certain amount and will be resistant to permanent staining from food substances or mold (provided the stain is cleaned within seven days of appearance). This warranty extends for a period of 25 years for residential use and 10 years for commercial use. If there is a breach of such warranties, the Company has an obligation either to replace the defective product or refund the purchase price. | |
Historically, the Company has not had material numbers of claims submitted or settled under the provisions of its product warranties, with the exception of claims related to material produced at its Nevada facility prior to 2007 that exhibits surface flaking. The Company continues to receive and settle surface flaking claims and maintains a warranty reserve to provide for the settlement of these claims. Estimating the warranty reserve for surface flaking claims requires management to estimate (1) the number of claims to be settled with payment and (2) the average cost to settle each claim, both of which are subject to variables that are difficult to estimate. | |
To estimate the number of claims to be settled with payment, the Company utilizes actuarial techniques to quantify both the expected number of claims to be received and the percentage of those claims that will ultimately require payment. Estimates for both of these elements (number and percentage of claims that will ultimately require payment) are quantified using a range of assumptions derived from the recent claim count history and the identification of factors influencing the claim counts, including the downward trend in received claims due to the passage of time since production of the suspect material. For each of the various parameters used in the analysis, the assumed values in the actuarial valuation produce results that represent the Company’s best estimate for the ultimate number of claims to be settled with payment. The cost per claim varies due to a number of factors, including the size of affected decks, the type of replacement material used, the cost of production of replacement material and the method of claim settlement. |
Inventories_Tables
Inventories (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Inventory Disclosure [Abstract] | ' | ||||||||
Summary of Inventories, at LIFO Value | ' | ||||||||
Inventories, at LIFO (last-in, first-out) value, consist of the following (in thousands): | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Finished goods | $ | 39,339 | $ | 30,423 | |||||
Raw materials | 15,371 | 16,502 | |||||||
Total FIFO inventories | 54,710 | 46,925 | |||||||
Reserve to adjust inventories to LIFO value | (24,497 | ) | (24,497 | ) | |||||
Total LIFO inventories | $ | 30,213 | $ | 22,428 | |||||
Accrued_Expenses_Tables
Accrued Expenses (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Payables And Accruals [Abstract] | ' | ||||||||
Summary of Accrued Expenses | ' | ||||||||
Accrued expenses consist of the following (in thousands): | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Accrued sales and marketing | $ | 4,157 | $ | 5,269 | |||||
Accrued compensation and benefits | 3,919 | 9,135 | |||||||
Accrued rent obligations | 2,227 | 1,787 | |||||||
Accrued legal contingency | 1,586 | 3,174 | |||||||
Accrued manufacturing expenses | 1,434 | 1,107 | |||||||
Other | 3,155 | 2,823 | |||||||
Total accrued expenses | $ | 16,478 | $ | 23,295 | |||||
Stockholders_Equity_Tables
Stockholders' Equity (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Equity [Abstract] | ' | ||||||||
Computation of Basic and Diluted Earnings Per Share | ' | ||||||||
The following table sets forth the computation of basic and diluted earnings per share (in thousands, except share and per share data): | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
Numerator: | |||||||||
Net income available to common shareholders | $ | 12,295 | $ | 21,569 | |||||
Denominator: | |||||||||
Basic weighted average shares outstanding | 16,564,338 | 16,883,111 | |||||||
Effect of dilutive securities: | |||||||||
SARs and options | 151,457 | 330,075 | |||||||
Restricted stock | 83,924 | 67,259 | |||||||
Diluted weighted average shares outstanding | 16,799,719 | 17,280,445 | |||||||
Basic earnings per share | $ | 0.74 | $ | 1.28 | |||||
Diluted earnings per share | $ | 0.73 | $ | 1.25 | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ' | ||||||||
The computation of diluted earnings per share excludes the following potentially dilutive securities because the effect would be anti-dilutive: | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
Restricted stock and stock options | 44 | 32,872 | |||||||
Stock appreciation rights | 598 | 30,753 |
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' | ||||||||
Summary of Assumptions Used to Estimate Fair Value of Each SAR | ' | ||||||||
The fair value of each SAR is estimated on the date of grant using a Black-Scholes option-pricing formula. For SARs issued in the three months ended March 31, 2014 and 2013, respectively, the assumptions shown in the following table were used: | |||||||||
Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
Weighted-average fair value of grants | $ | 37.4 | $ | 23.34 | |||||
Dividend yield | 0 | % | 0 | % | |||||
Average risk-free interest rate | 1.8 | % | 0.7 | % | |||||
Expected term (years) | 5 | 5 | |||||||
Expected volatility | 54 | % | 64 | % | |||||
Summary of Stock-Based Compensation Grants | ' | ||||||||
The following table summarizes the Company’s stock-based compensation grants for the three months ended March 31, 2014: | |||||||||
Stock Awards Granted | Weighted-Average | ||||||||
Grant Price | |||||||||
Per Share | |||||||||
Stock appreciation rights | 1,562 | $ | 78.15 | ||||||
Time-based restricted stock | 27,062 | $ | 67.45 | ||||||
Performance-based restricted stock | 21,338 | $ | 67.43 | ||||||
Summary of Stock-Based Compensation Expense | ' | ||||||||
The following table summarizes the Company’s stock-based compensation expense for the three months ended March 31, 2014 and 2013 (in thousands): | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
Stock appreciation rights | $ | 370 | $ | 331 | |||||
Time-based restricted stock | 708 | 537 | |||||||
Performance-based restricted stock | 82 | — | |||||||
Employee stock purchase plan | 10 | 27 | |||||||
Total stock-based compensation | $ | 1,170 | $ | 895 | |||||
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Commitments And Contingencies Disclosure [Abstract] | ' | ||||||||
Summary of Liability Related to Lease | ' | ||||||||
The following table provides information about the Company’s liability related to the lease (in thousands): | |||||||||
2014 | 2013 | ||||||||
Beginning balance, January 1 | $ | 1,787 | $ | 1,103 | |||||
Net rental receipts (payments) | (162 | ) | (110 | ) | |||||
Accretion of discount | 35 | 21 | |||||||
Increase in net estimated contract termination costs | 567 | — | |||||||
Ending balance, March 31 | $ | 2,227 | $ | 1,014 | |||||
Summary of Reconciliation of Company's Warranty Reserve | ' | ||||||||
The following is a reconciliation of the Company’s warranty reserve (in thousands): | |||||||||
2014 | 2013 | ||||||||
Beginning balance, January 1 | $ | 40,812 | $ | 28,987 | |||||
Changes in estimates related to pre-existing warranties | — | — | |||||||
Settlements made during the period | (2,010 | ) | (1,681 | ) | |||||
Ending balance, March 31 | $ | 38,802 | $ | 27,306 | |||||
Subsequent_Events_Tables
Subsequent Events (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Subsequent Events [Abstract] | ' | ||||||||
Pro Forma Share and Per Share Data, Giving Retroactive Effect to the Stock Split | ' | ||||||||
Pro forma share and per share data, giving retroactive effect to the stock split, are as follows: | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
Weighted average shares outstanding: | |||||||||
Basic weighted average shares outstanding, as reported (pre-stock split) | 16,564,338 | 16,883,111 | |||||||
Basic weighted average shares outstanding, pro forma (post-stock split) | 33,128,676 | 33,766,222 | |||||||
Diluted weighted average shares outstanding, as reported (pre-stock split) | 16,799,719 | 17,280,445 | |||||||
Diluted weighted average shares outstanding, pro forma (post-stock split) | 33,599,438 | 34,560,890 | |||||||
Earnings per common share: | |||||||||
Basic earnings per share, as reported (pre-stock split) | $ | 0.74 | $ | 1.28 | |||||
Basic earnings per share, pro forma (post-stock split) | $ | 0.37 | $ | 0.64 | |||||
Diluted earnings per share, as reported (pre-stock split) | $ | 0.73 | $ | 1.25 | |||||
Diluted earnings per share, pro forma (post-stock split) | $ | 0.37 | $ | 0.62 |
Business_and_Organization_Addi
Business and Organization - Additional Information (Detail) | 3 Months Ended |
Mar. 31, 2014 | |
Segment | |
Business And Organization [Abstract] | ' |
Number of operating segments of business | 1 |
Inventories_Summary_of_Invento
Inventories - Summary of Inventories, at LIFO Value (Detail) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Inventory Net [Abstract] | ' | ' |
Finished goods | $39,339 | $30,423 |
Raw materials | 15,371 | 16,502 |
Total FIFO inventories | 54,710 | 46,925 |
Reserve to adjust inventories to LIFO value | -24,497 | -24,497 |
Total LIFO inventories | $30,213 | $22,428 |
Inventories_Additional_Informa
Inventories - Additional Information (Detail) (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Inventory Disclosure [Abstract] | ' | ' |
LIFO inventory liquidations | $0 | $0 |
Accrued_Expenses_Summary_of_Ac
Accrued Expenses - Summary of Accrued Expenses (Detail) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Accrued Liabilities Current [Abstract] | ' | ' |
Accrued sales and marketing | $4,157 | $5,269 |
Accrued compensation and benefits | 3,919 | 9,135 |
Accrued rent obligations | 2,227 | 1,787 |
Accrued legal contingency | 1,586 | 3,174 |
Accrued manufacturing expenses | 1,434 | 1,107 |
Other | 3,155 | 2,823 |
Total accrued expenses | $16,478 | $23,295 |
Debt_Additional_Information_De
Debt - Additional Information (Detail) (Revolving Credit Facility [Member], USD $) | Mar. 31, 2014 | Dec. 17, 2013 | Dec. 17, 2013 | Mar. 31, 2014 |
In Millions, unless otherwise specified | Revolver Loans Second Amendment Portion Effective One January Two Zero One Four [Member] | Revolver Loans Second Amendment Portion Effective Thirty June Two Zero One Four [Member] | Revolver Loans [Member] | |
Line of Credit Facility [Line Items] | ' | ' | ' | ' |
Revolving loans in a collective maximum principal amount | ' | $125 | $100 | $100 |
Remaining available borrowing capacity | 45 | ' | ' | ' |
Outstanding borrowings under its revolving credit facility | $80 | ' | ' | ' |
Stockholders_Equity_Computatio
Stockholders' Equity - Computation of Basic and Diluted Earnings Per Share (Detail) (USD $) | 3 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Numerator: | ' | ' |
Net income available to common shareholders | $12,295 | $21,569 |
Denominator: | ' | ' |
Basic weighted average shares outstanding | 16,564,338 | 16,883,111 |
Effect of dilutive securities: | ' | ' |
SARs and options | 151,457 | 330,075 |
Restricted stock | 83,924 | 67,259 |
Diluted weighted average shares outstanding | 16,799,719 | 17,280,445 |
Basic earnings per share | $0.74 | $1.28 |
Diluted earnings per share | $0.73 | $1.25 |
Stockholders_Equity_Antidiluti
Stockholders' Equity - Antidilutive Securities Excluded from Computation of Earnings Per Share (Detail) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Restricted Stock and Stock Options [Member] | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Anti-dilutive securities excluded from the computation of diluted earnings per share | 44 | 32,872 |
Stock Appreciation Rights [Member] | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Anti-dilutive securities excluded from the computation of diluted earnings per share | 598 | 30,753 |
Stockholders_Equity_Additional
Stockholders' Equity - Additional Information (Detail) (USD $) | 0 Months Ended | 3 Months Ended | 0 Months Ended | 3 Months Ended |
In Millions, except Share data, unless otherwise specified | Oct. 24, 2013 | Mar. 31, 2014 | Feb. 19, 2014 | Mar. 31, 2014 |
October 2013 Stock Repurchase Program [Member] | October 2013 Stock Repurchase Program [Member] | February 2014 Stock Repurchase Program [Member] | February 2014 Stock Repurchase Program [Member] | |
Equity, Class of Treasury Stock [Line Items] | ' | ' | ' | ' |
Stock repurchase authorized amount | $30 | ' | $50 | ' |
Value of shares repurchased by the Company | ' | 0 | ' | 0 |
Expiration date of authorized common stock repurchase program | 10-Feb-14 | ' | ' | ' |
StockBased_Compensation_Additi
Stock-Based Compensation - Additional Information (Detail) (USD $) | 3 Months Ended |
In Millions, except Share data, unless otherwise specified | Mar. 31, 2014 |
Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Number of stock based compensation plan | 1 |
Unrecognized compensation cost related to unvested awards | $7.20 |
Performance Based Restricted Stock [Member] | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Vesting Period | '3 years |
Share Based Compensation Award Tranche One [Member] | Performance Based Restricted Stock [Member] | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Stock based Compensation vesting percentage | 33.33% |
Share Based Compensation Award Tranche Two [Member] | Performance Based Restricted Stock [Member] | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Stock based Compensation vesting percentage | 33.33% |
Share Based Compensation Award Tranche Three [Member] | Performance Based Restricted Stock [Member] | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Stock based Compensation vesting percentage | 33.33% |
Minimum [Member] | Performance Based Restricted Stock [Member] | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Percentage of target number of shares that will vest | 0.00% |
Maximum [Member] | Performance Based Restricted Stock [Member] | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Percentage of target number of shares that will vest | 200.00% |
2005 Stock Incentive Plan [Member] | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Total aggregate number of shares of common stock that may be issued | 3,150,000 |
StockBased_Compensation_Summar
Stock-Based Compensation - Summary of Assumptions Used to Estimate Fair Value of Each SAR (Detail) (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Share Based Compensation Arrangement By Share Based Payment Award Fair Value Assumptions And Methodology [Abstract] | ' | ' |
Weighted-average fair value of grants | $37.40 | $23.34 |
Dividend yield | 0.00% | 0.00% |
Average risk-free interest rate | 1.80% | 0.70% |
Expected term (years) | '5 years | '5 years |
Expected volatility | 54.00% | 64.00% |
StockBased_Compensation_Summar1
Stock-Based Compensation - Summary of Stock-Based Compensation Grants (Detail) (USD $) | 3 Months Ended |
Mar. 31, 2014 | |
Stock Appreciation Rights [Member] | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Stock Awards Granted | 1,562 |
Weighted-Average Grant Price Per Share | $78.15 |
Time Based Restricted Stock [Member] | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Stock Awards Granted | 27,062 |
Weighted-Average Grant Price Per Share | $67.45 |
Performance Based Restricted Stock [Member] | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Stock Awards Granted | 21,338 |
Weighted-Average Grant Price Per Share | $67.43 |
StockBased_Compensation_Summar2
Stock-Based Compensation - Summary of Stock-Based Compensation Expense (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Stock-based compensation expense | $1,170 | $895 |
Stock Appreciation Rights [Member] | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Stock-based compensation expense | 370 | 331 |
Time Based Restricted Stock [Member] | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Stock-based compensation expense | 708 | 537 |
Performance Based Restricted Stock [Member] | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Stock-based compensation expense | 82 | ' |
Employee Stock Purchase Plan [Member] | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Stock-based compensation expense | $10 | $27 |
Income_Taxes_Additional_Inform
Income Taxes - Additional Information (Detail) (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Income Taxes And Tax Related [Line Items] | ' | ' |
Valuation allowance | $4,200,000 | ' |
Effective tax rate | 37.30% | 0.90% |
Income tax expense | 7,327,000 | 198,000 |
Excess tax benefits from stock-based awards | $6,500,000 | ' |
Minimum [Member] | Federal Tax Jurisdiction [Member] | ' | ' |
Income Taxes And Tax Related [Line Items] | ' | ' |
Years subject to income tax examination | '2010 | ' |
Minimum [Member] | State and Local Jurisdiction [Member] | ' | ' |
Income Taxes And Tax Related [Line Items] | ' | ' |
Years subject to income tax examination | '2008 | ' |
Minimum [Member] | Michigan [Member] | ' | ' |
Income Taxes And Tax Related [Line Items] | ' | ' |
Tax examination year under examination | '2008 | ' |
Maximum [Member] | Federal Tax Jurisdiction [Member] | ' | ' |
Income Taxes And Tax Related [Line Items] | ' | ' |
Years subject to income tax examination | '2013 | ' |
Maximum [Member] | State and Local Jurisdiction [Member] | ' | ' |
Income Taxes And Tax Related [Line Items] | ' | ' |
Years subject to income tax examination | '2013 | ' |
Maximum [Member] | Michigan [Member] | ' | ' |
Income Taxes And Tax Related [Line Items] | ' | ' |
Tax examination year under examination | '2011 | ' |
Commitments_and_Contingencies_1
Commitments and Contingencies - Additional Information (Detail) (USD $) | 0 Months Ended | 3 Months Ended | |
Sep. 03, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | |
Lawsuits | |||
Schedule Of Commitments And Contingencies [Line Items] | ' | ' | ' |
Charge recorded due to revised estimate of sublease receipts | ' | $567,000 | ' |
Percentage change in warranty claims used as a threshold for disclosure | ' | 10.00% | ' |
Change in warranty reserve for disclosure purposes only | ' | 3,900,000 | ' |
Number of lawsuits settled | 2 | ' | ' |
Capped cost to Trex, excluding attorneys' fees, upon final approval of the settlement by the Court | ' | 8,250,000 | ' |
Capped attorneys' fees to be paid to Plaintiffs' counsel upon final approval of the settlement by the Court | ' | 1,450,000 | ' |
Payments related to mold growth litigation | ' | 1,600,000 | ' |
Remaining accrual related to litigation | ' | 1,586,000 | 3,174,000 |
Expected total net cost to resolve the lawsuit will not exceed | ' | 10,000,000 | ' |
Residential Use [Member] | ' | ' | ' |
Schedule Of Commitments And Contingencies [Line Items] | ' | ' | ' |
Warranty period | ' | '25 years | ' |
Commercial Use [Member] | ' | ' | ' |
Schedule Of Commitments And Contingencies [Line Items] | ' | ' | ' |
Warranty period | ' | '10 years | ' |
Transcend, Enhance, Select and Universal Fascia Product [Member] | Residential Use [Member] | ' | ' | ' |
Schedule Of Commitments And Contingencies [Line Items] | ' | ' | ' |
Warranty period | ' | '25 years | ' |
Transcend, Enhance, Select and Universal Fascia Product [Member] | Commercial Use [Member] | ' | ' | ' |
Schedule Of Commitments And Contingencies [Line Items] | ' | ' | ' |
Warranty period | ' | '10 years | ' |
TrexTrim and Trex Reveal Railing [Member] | Commercial and Residential Use [Member] | ' | ' | ' |
Schedule Of Commitments And Contingencies [Line Items] | ' | ' | ' |
Warranty period | ' | '25 years | ' |
Contract Termination [Member] | ' | ' | ' |
Schedule Of Commitments And Contingencies [Line Items] | ' | ' | ' |
Lease square feet | ' | 55,047 | ' |
Charge recorded due to revised estimate of sublease receipts | ' | 600,000 | ' |
Minimum payments remaining under the Company's lease relating to its reconsidered corporate relocation for remainder of 2014 | ' | 1,300,000 | ' |
Minimum payments remaining under the Company's lease relating to its reconsidered corporate relocation for 2015 | ' | 1,700,000 | ' |
Minimum payments remaining under the Company's lease relating to its reconsidered corporate relocation for 2016 | ' | 1,800,000 | ' |
Minimum payments remaining under the Company's lease relating to its reconsidered corporate relocation for 2017 | ' | 1,800,000 | ' |
Minimum payments remaining under the Company's lease relating to its reconsidered corporate relocation for 2018 | ' | 1,800,000 | ' |
Minimum payments remaining under the Company's lease relating to its reconsidered corporate relocation, thereafter | ' | 900,000 | ' |
Minimum receipts remaining under the Company's existing subleases for remainder of 2014 | ' | 1,000,000 | ' |
Minimum receipts remaining under the Company's existing subleases for 2015 | ' | 800,000 | ' |
Minimum receipts remaining under the Company's existing subleases for 2016 | ' | 700,000 | ' |
Minimum receipts remaining under the Company's existing subleases for 2017 | ' | 700,000 | ' |
Minimum receipts remaining under the Company's existing subleases for 2018 | ' | 700,000 | ' |
Minimum receipts remaining under the Company's existing subleases, thereafter | ' | $400,000 | ' |
Sublease [Member] | ' | ' | ' |
Schedule Of Commitments And Contingencies [Line Items] | ' | ' | ' |
Lease square feet | ' | 41,701 | ' |
Subleases Expiring December 31, 2014 Member [Member] | ' | ' | ' |
Schedule Of Commitments And Contingencies [Line Items] | ' | ' | ' |
Lease square feet | ' | 16,969 | ' |
Commitments_and_Contingencies_2
Commitments and Contingencies - Summary of Liability Related to Lease (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Commitments And Contingencies Disclosure [Abstract] | ' | ' |
Beginning balance | $1,787 | $1,103 |
Net rental receipts (payments) | -162 | -110 |
Accretion of discount | 35 | 21 |
Increase in net estimated contract termination costs | 567 | ' |
Ending balance | $2,227 | $1,014 |
Commitments_and_Contingencies_3
Commitments and Contingencies - Summary of Reconciliation of Company's Warranty Reserve (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Commitments And Contingencies Disclosure [Abstract] | ' | ' |
Beginning balance | $40,812 | $28,987 |
Changes in estimates related to pre-existing warranties | ' | ' |
Settlements made during the period | -2,010 | -1,681 |
Ending balance | $38,802 | $27,306 |
Subsequent_Events_Additional_I
Subsequent Events - Additional Information (Detail) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | 7-May-14 | Apr. 30, 2014 | Mar. 31, 2014 | Feb. 19, 2014 |
In Millions, except Share data, unless otherwise specified | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | ||
Subsequent Event [Line Items] | ' | ' | ' | ' | ' | ' |
Company's common stock, par value per share | $0.01 | $0.01 | $0.01 | ' | ' | $0.01 |
Company's common stock, Shares, Outstanding | 16,777,781 | 16,737,807 | 33,600,000 | ' | ' | 16,800,000 |
Increase number of authorized share of common stock | 40,000,000 | 40,000,000 | ' | 80,000,000 | 40,000,000 | ' |
Stock split ratio | ' | ' | 2 | ' | ' | ' |
Pro forma increase to common stock as a result of the stock split | ' | ' | $0.20 | ' | ' | ' |
Pro forma offsetting reduction to additional paid-in capital as a result of the stock split | ' | ' | $0.20 | ' | ' | ' |
Subsequent_Events_Pro_Forma_Sh
Subsequent Events - Pro Forma Share and Per Share Data, Giving Retroactive Effect to the Stock Split (Detail) (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Weighted average shares outstanding: | ' | ' |
Basic weighted average shares outstanding, as reported (pre-stock split) | 16,564,338 | 16,883,111 |
Diluted weighted average shares outstanding, as reported (pre-stock split) | 16,799,719 | 17,280,445 |
Earnings per common share: | ' | ' |
Basic earnings per share, as reported (pre-stock split) | $0.74 | $1.28 |
Diluted earnings per share, as reported (pre-stock split) | $0.73 | $1.25 |
Subsequent Event [Member] | ' | ' |
Weighted average shares outstanding: | ' | ' |
Basic weighted average shares outstanding, pro forma (post-stock split) | 33,128,676 | 33,766,222 |
Diluted weighted average shares outstanding, pro forma (post-stock split) | 33,599,438 | 34,560,890 |
Earnings per common share: | ' | ' |
Basic earnings per share, pro forma (post-stock split) | $0.37 | $0.64 |
Diluted earnings per share, pro forma (post-stock split) | $0.37 | $0.62 |