Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2016 | Feb. 07, 2017 | Jun. 30, 2016 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2016 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | TREX | ||
Entity Registrant Name | TREX CO INC | ||
Entity Central Index Key | 1,069,878 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 29,384,211 | ||
Entity Public Float | $ 1.3 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Statement [Abstract] | |||
Net sales | $ 479,616 | $ 440,804 | $ 391,660 |
Cost of sales | 292,521 | 285,935 | 251,464 |
Gross profit | 187,095 | 154,869 | 140,196 |
Selling, general and administrative expenses | 83,140 | 77,463 | 72,370 |
Income from operations | 103,955 | 77,406 | 67,826 |
Interest expense, net | 1,125 | 619 | 878 |
Income before income taxes | 102,830 | 76,787 | 66,948 |
Provision for income taxes | 34,983 | 28,689 | 25,427 |
Net income | $ 67,847 | $ 48,098 | $ 41,521 |
Basic earnings per common share | $ 2.31 | $ 1.53 | $ 1.28 |
Basic weighted average common shares outstanding | 29,394,559 | 31,350,542 | 32,319,649 |
Diluted earnings per common share | $ 2.29 | $ 1.52 | $ 1.27 |
Diluted weighted average common shares outstanding | 29,612,669 | 31,682,509 | 32,751,074 |
Comprehensive income | $ 67,847 | $ 48,098 | $ 41,521 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Current Assets: | ||
Cash and cash equivalents | $ 18,664 | $ 5,995 |
Accounts receivable, net | 48,039 | 47,386 |
Inventories | 28,546 | 23,104 |
Prepaid expenses and other assets | 10,400 | 13,409 |
Deferred income taxes | 9,136 | |
Total current assets | 105,649 | 99,030 |
Property, plant and equipment, net | 103,286 | 100,924 |
Goodwill and other intangibles | 10,523 | 10,526 |
Other assets | 1,972 | 1,518 |
Total Assets | 221,430 | 211,998 |
Current Liabilities: | ||
Accounts payable | 10,767 | 17,733 |
Accrued expenses | 34,693 | 28,891 |
Accrued warranty | 5,925 | 6,825 |
Line of Credit | 7,000 | |
Total current liabilities | 51,385 | 60,449 |
Deferred income taxes | 894 | 4,597 |
Non-current accrued warranty | 31,767 | 26,698 |
Other long-term liabilities | 3,223 | 3,791 |
Total Liabilities | 87,269 | 95,535 |
Commitments and contingencies | ||
Stockholders' Equity: | ||
Preferred stock, $0.01 par value, 3,000,000 shares authorized; none issued and outstanding | ||
Common stock, $0.01 par value, 80,000,000 shares authorized; 34,894,233 and 34,819,259 shares issued and 29,400,552 and 30,904,530 shares outstanding at December 31, 2016 and 2015, respectively | 349 | 348 |
Additional paid-in capital | 120,082 | 116,947 |
Retained earnings | 187,242 | 119,395 |
Treasury stock, at cost, 5,493,681 and 3,914,729 shares at December 31, 2016 and 2015, respectively | (173,512) | (120,227) |
Total Stockholders' Equity | 134,161 | 116,463 |
Total Liabilities and Stockholders' Equity | $ 221,430 | $ 211,998 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2016 | Dec. 31, 2015 |
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 | 80,000,000 | 80,000,000 |
Common stock, shares issued | 34,894,233 | 34,819,259 |
Common stock, shares outstanding | 29,400,552 | 30,904,530 |
Treasury stock, shares | 5,493,681 | 3,914,729 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock [Member] | Additional Paid-In Capital [Member] | Retained Earnings (Deficit) [Member] | Treasury Stock [Member] |
Beginning Balance at Dec. 31, 2013 | $ 106,616 | $ 346 | $ 101,494 | $ 29,776 | $ (25,000) |
Beginning Balance, Shares at Dec. 31, 2013 | 33,475,614 | 1,122,510 | |||
Net income | 41,521 | 41,521 | |||
Employee stock purchase and option plans | 747 | $ 1 | 746 | ||
Employee stock purchase and option plans, Shares | 133,133 | ||||
Shares withheld for taxes on share-based payment awards | (3,189) | (3,189) | |||
Shares withheld for taxes on share-based payment awards, Shares | (36,610) | ||||
Stock-based compensation | 4,807 | $ 1 | 4,806 | ||
Stock-based compensation, Shares | 105,905 | ||||
Excess tax benefits from stock compensation | 12,883 | 12,883 | |||
Shares repurchased under our publicly announced share repurchase programs | (50,000) | $ (50,000) | |||
Shares repurchased under our publicly announced share repurchase programs, Shares | 1,657,919 | ||||
Shares repurchased under our publicly announced share repurchase programs, Shares | (1,657,919) | ||||
Ending Balance at Dec. 31, 2014 | 113,385 | $ 348 | 116,740 | 71,297 | $ (75,000) |
Ending Balance, Shares at Dec. 31, 2014 | 32,020,123 | 2,780,429 | |||
Net income | 48,098 | 48,098 | |||
Employee stock purchase and option plans | 315 | $ 1 | 314 | ||
Employee stock purchase and option plans, Shares | 113,996 | ||||
Shares withheld for taxes on share-based payment awards | (8,086) | $ (1) | (8,085) | ||
Shares withheld for taxes on share-based payment awards, Shares | (115,453) | ||||
Stock-based compensation | 4,861 | 4,861 | |||
Stock-based compensation, Shares | 20,164 | ||||
Excess tax benefits from stock compensation | 3,117 | 3,117 | |||
Shares repurchased under our publicly announced share repurchase programs | (45,227) | $ (45,227) | |||
Shares repurchased under our publicly announced share repurchase programs, Shares | 1,134,300 | ||||
Shares repurchased under our publicly announced share repurchase programs, Shares | (1,134,300) | ||||
Ending Balance at Dec. 31, 2015 | 116,463 | $ 348 | 116,947 | 119,395 | $ (120,227) |
Ending Balance, Shares at Dec. 31, 2015 | 30,904,530 | 3,914,729 | |||
Net income | 67,847 | 67,847 | |||
Employee stock purchase and option plans | 280 | $ 1 | 279 | ||
Employee stock purchase and option plans, Shares | 79,175 | ||||
Shares withheld for taxes on share-based payment awards | (1,933) | $ (1) | (1,932) | ||
Shares withheld for taxes on share-based payment awards, Shares | (13,193) | ||||
Stock-based compensation | 4,789 | $ 1 | 4,788 | ||
Stock-based compensation, Shares | 8,992 | ||||
Shares repurchased under our publicly announced share repurchase programs | (53,285) | $ (53,285) | |||
Shares repurchased under our publicly announced share repurchase programs, Shares | 1,578,952 | ||||
Shares repurchased under our publicly announced share repurchase programs, Shares | (1,578,952) | ||||
Ending Balance at Dec. 31, 2016 | $ 134,161 | $ 349 | $ 120,082 | $ 187,242 | $ (173,512) |
Ending Balance, Shares at Dec. 31, 2016 | 29,400,552 | 5,493,681 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Operating Activities | |||
Net income | $ 67,847 | $ 48,098 | $ 41,521 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 14,498 | 14,384 | 15,204 |
Deferred income taxes | 5,433 | 1,024 | 3,574 |
Stock-based compensation | 4,788 | 4,861 | 4,807 |
(Gain) Loss on disposal of property, plant and equipment | (185) | 649 | 158 |
Excess tax benefits from stock compensation | (3,147) | (12,898) | |
Other non-cash adjustments | (284) | (271) | (245) |
Changes in operating assets and liabilities: | |||
Accounts receivable | (653) | (10,995) | 867 |
Inventories | (5,442) | 643 | (1,319) |
Prepaid expenses and other assets | (4,256) | 905 | (624) |
Accounts payable | (6,966) | (2,317) | 5,159 |
Accrued expenses and other liabilities | 9,403 | 7,554 | (7,535) |
Income taxes receivable/payable | 1,110 | 1,246 | 9,973 |
Net cash provided by operating activities | 85,293 | 62,634 | 58,642 |
Investing Activities | |||
Expenditures for property, plant and equipment | (14,551) | (23,333) | (12,974) |
Proceeds from sales of property, plant and equipment | 4,349 | 35 | 66 |
Purchase of acquired company, net of cash acquired | (31) | (44) | |
Notes receivable, net | 79 | ||
Net cash used in investing activities | (10,202) | (23,329) | (12,873) |
Financing Activities | |||
Financing costs | (485) | (3) | (453) |
Borrowings under line of credit | 242,700 | 225,500 | 143,000 |
Principal payments under line of credit | (249,700) | (218,500) | (143,000) |
Repurchases of common stock | (55,216) | (53,313) | (53,189) |
Proceeds from employee stock purchase and option plans | 279 | 315 | 747 |
Excess tax benefits from stock compensation | 3,147 | 12,898 | |
Net cash used in financing activities | (62,422) | (42,854) | (39,997) |
Net increase (decrease) in cash and cash equivalents | 12,669 | (3,549) | 5,772 |
Cash and cash equivalents at beginning of year | 5,995 | 9,544 | 3,772 |
Cash and cash equivalents at end of year | 18,664 | 5,995 | 9,544 |
Supplemental disclosures of cash flow information: | |||
Cash paid for interest | 852 | 625 | 520 |
Cash paid for income taxes, net | $ 28,626 | $ 26,327 | $ 11,919 |
Business and Organization
Business and Organization | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business and Organization | 1. BUSINESS AND ORGANIZATION Trex Company, Inc. (together with its subsidiary, the Company), a Delaware corporation, was incorporated on September 4, 1998. The Company manufactures and distributes wood/plastic composite products, as well as related accessories, primarily for residential and commercial decking and railing applications. A majority of its products are manufactured in a proprietary process that combines reclaimed wood fibers and scrap polyethylene. The Company operates in a single reportable segment. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Accounting The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States and include the accounts of the Company and its wholly-owned subsidiary, Trex Wood-Polymer Espana, S.L. (TWPE). Intercompany accounts and transactions have been eliminated in consolidation. TWPE was formed to hold the Company’s 35% equity interest in Denplax, S.A. (Denplax), a venture with a Spanish company responsible for public environmental programs in southern Spain and with an Italian equipment manufacturer. The venture was formed to recycle polyethylene at a facility in El Ejido, Spain. The Company’s investment in Denplax is accounted for using the equity method. During 2010, the Company determined that its investment in Denplax and a related note receivable were no longer recoverable and recorded a $2.4 million charge to earnings to fully reserve the equity investment and note. Both the equity investment and note remain fully reserved as of December 31, 2016. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and the accompanying notes. Actual results could differ from those estimates. Cash and Cash Equivalents Cash equivalents consist of highly liquid investments purchased with original maturities of three months or less. Concentrations and Credit Risk The Company’s financial instruments that are exposed to concentrations of credit risk consist primarily of cash and cash equivalents and trade accounts receivable. The Company from time to time may have bank deposits in excess of insurance limits of the Federal Deposit Insurance Corporation. As of December 31, 2016, substantially all deposits are maintained in one financial institution. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk related to its cash and cash equivalents. The Company routinely assesses the financial strength of its customers and believes that its trade receivables credit risk exposure is limited. Trade receivables are carried at the original invoice amount less an estimate made for payment discounts and doubtful accounts. A valuation allowance is provided for known and anticipated credit losses and disputed amounts, as determined by management in the course of regularly evaluating individual customer receivables. This evaluation takes into consideration a customer’s financial condition and credit history, as well as current economic conditions. There was no valuation allowance recorded as of December 31, 2016 and 2015. In the years ended December 31, 2016, 2015 and 2014, sales to certain customers accounted for 10% or more of the Company’s total net sales. For the year ended December 31, 2016, two customers of the Company represented approximately 39% of the Company’s net sales. For the year ended December 31, 2015, one customer of the Company represented approximately 27% of the Company’s net sales. For the year ended December 31, 2014, one customer of the Company represented approximately 24% of the Company’s net sales. At December 31, 2016, four customers represented 30%, 16%, 14%, and 13%, respectively, of the Company’s accounts receivable balance. Approximately 33%, 35%, and 38% of the Company’s materials purchases for the years ended December 31, 2016, 2015 and 2014, respectively, were purchased from its four largest suppliers. Inventories Inventories are stated at the lower of cost (last-in, first-out, or LIFO, method) or market value. The Company periodically reviews its inventory for slow moving or obsolete items and writes down the related products to estimated realizable value. The Company’s reserves for estimated slow moving products or obsolescence are not material. At December 31, 2016, the excess of the replacement cost of inventory over the LIFO value of inventory was approximately $21.4 million. Due to the nature of the LIFO valuation methodology, liquidations of inventories will result in a portion of the Company’s cost of sales being based on historical rather than current year costs. A majority of the Company’s products are made in a proprietary process that combines reclaimed wood fibers and scrap polyethylene. The Company grinds up scrap materials generated from its manufacturing process and inventories deemed no longer salable and reintroduces the reclaimed material into the manufacturing process as a substitute for raw materials. The reclaimed material is valued at the costs of the raw material components of the material. Property, Plant and Equipment Property, plant and equipment are stated at historical cost. The costs of additions and improvements are capitalized, while maintenance and repairs are expensed as incurred. Depreciation is provided using the straight-line method over the following estimated useful lives: Buildings 40 years Machinery and equipment 3-11 years Furniture and equipment 10 years Forklifts and tractors 5 years Computer equipment and software 5 years Leasehold improvements are amortized over the shorter of the lease term or the estimated useful life of the asset. The Company reviews its long-lived assets, including property, plant and equipment, whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. To determine the recoverability of its long-lived assets, the Company evaluates the probability that future estimated undiscounted net cash flows will be less than the carrying amount of the long-lived assets. If the estimated cash flows are less than the carrying amount of the long-lived assets, the assets are written down to their fair value. The Company’s estimates of anticipated cash flows and the remaining estimated useful lives of long-lived assets could be reduced in the future. As a result, the carrying amount of long-lived assets could be reduced in the future. Long-lived assets held for sale are stated at the lower of cost or fair value less cost to sell. Fair Value Measurement Assets and liabilities measured at fair value are measured at the amount that would be received for selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date and classified into one of the following fair value hierarchy: • Level 1 – Quoted prices for identical instruments in active markets. • Level 2 – Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model derived valuations in which all significant inputs and significant value drivers are observable in active markets. • Level 3 – Valuations derived from management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. Contract Termination Costs The Company leases 55,047 square feet of office and storage space in Dulles, Virginia, that it does not occupy, but has sublet all of the office space for the remainder of the term of its lease obligation, which ends June 30, 2019. The future sublease receipts are less than the remaining minimum lease payment obligations under the Company’s lease. Accordingly, the Company has recorded a liability for the present value of the shortfall. Goodwill Goodwill represents the excess of cost over net assets acquired resulting from the Company’s 1996 purchase of the Mobil Composite Products Division and the 2011 purchase of the assets of the Iron Deck Corporation. The Company evaluates the recoverability of goodwill in accordance with Accounting Standard Codification Topic 350, “ Intangibles – Goodwill and Other The Company first assesses qualitative factors to determine if it is more likely than not that the fair value of the reporting unit is less than its carrying amount to determine if it should proceed with the evaluation of goodwill for impairment. If the Company proceeds with the two-step impairment test, the Company first compares the fair value of the reporting unit to its carrying value. If the carrying value of a reporting unit exceeds its fair value, the goodwill of that reporting unit is potentially impaired and step two of the impairment analysis is performed. In step two of the analysis, an impairment loss is recorded equal to the excess of the carrying value of the reporting unit’s goodwill over its implied fair value should such a circumstance arise. The Company measures fair value of the reporting unit based on a present value of future discounted cash flows and a market valuation approach. The discounted cash flows model indicates the fair value of the reporting unit based on the present value of the cash flows that the reporting unit is expected to generate in the future. Significant estimates in the discounted cash flows model include: the weighted average cost of capital; long-term rate of growth and profitability of the business; and working capital effects. The market valuation approach indicates the fair value of the business based on a comparison of the Company against certain market information. Significant estimates in the market approach model include identifying appropriate market multiples and assessing earnings before interest, income taxes, depreciation and amortization (EBITDA) in estimating the fair value of the reporting unit. For the years ended December 31, 2016, 2015 and 2014, the Company completed its annual impairment test of goodwill and noted no impairment. The Company performs the annual impairment testing of its goodwill as of October 31 of each year. However, actual results could differ from the Company’s estimates and projections, which would affect the assessment of impairment. As of December 31, 2016, the Company had goodwill of $10.5 million that is reviewed annually for impairment. 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 Trex Signature ® ® ® ® Treasury Stock The Company records the repurchase of shares of its common stock at cost. These shares are considered treasury stock, which is a reduction to stockholders’ equity. Treasury stock is included in authorized and issued shares but excluded from outstanding shares. Revenue Recognition The Company recognizes revenue when title is transferred to customers, which is generally upon shipment of the product to the customer. The Company does not grant contractual product return rights to customers other than pursuant to its product warranty. The Company does not expect future product returns to be material and, consequently, does not maintain an allowance for product returns. The Company records all shipping and handling fees in sales and records all of the related costs in cost of sales. The Company offers sales incentive programs to dealers and distributors, including rebates, pricing discounts, favorable payment terms and cooperative advertising, many of which result in cash consideration made to dealers and distributors. The Company accounts for consideration made pursuant to these programs in accordance with accounting guidance that governs consideration given by a vendor to a customer . Stock-Based Compensation The Company measures stock-based compensation at the grant date of the award based on the fair value. For stock options, stock appreciation rights and time-based restricted stock and time-based restricted stock units, stock-based compensation is recognized on a straight line basis over the vesting periods of the award. The Company recognizes forfeitures as they occur. For performance-based restricted stock and performance-based restricted stock units, expense is recognized ratably over the performance and vesting period of each tranche based on management’s judgment of the ultimate award that is probable to be paid out based on the achievement of predetermined performance measures. Stock-based compensation expense is included in “Selling, general and administrative expenses” in the accompanying Consolidated Statements of Comprehensive Income. Income Taxes The Company recognizes deferred tax assets and liabilities based on the difference between the financial statement basis and tax basis of assets and liabilities using enacted rates expected to be in effect during the year in which the differences reverse. The Company assesses the likelihood that its deferred tax assets will be realized. Deferred tax assets are reduced by a valuation allowance when, after considering all available positive and negative evidence, it is determined that it is more likely than not that some portion, or all, of the deferred tax asset will not be realized. As of December 31, 2016, the Company has a valuation allowance of $4.1 million against these deferred tax assets. The Company analyzes its position in subsequent reporting periods, considering all available positive and negative evidence, in determining the expected realization of its deferred tax assets. Research and Development Costs Research and development costs are expensed as incurred. For the years ended December 31, 2016, 2015 and 2014, research and development costs were $3.7 million, $1.5 million and $2.3 million, respectively, and have been included in “Selling, general and administrative expenses” in the accompanying Consolidated Statements of Comprehensive Income. Advertising Costs The Company expenses its branding and advertising communication costs as incurred. Significant production costs are deferred and recognized as expense in the period that the related advertisement is first used. At December 31, 2016 and December 31, 2015, $2.4 million and $0.8 million, respectively, were included in prepaid expenses for production costs. For the years ended December 31, 2016, 2015 and 2014, branding expenses, including advertising expenses as described above, were $24.8 million, $23.4 million and $20.8 million, respectively. Fair Value of 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 December 31, 2016 and 2015. Recently Adopted Accounting Standards In November 2015, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2015-17, “ Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes In March 2016, the FASB issued ASU No. 2016-09, “ Compensation – Stock Compensation (Topic 718) Improvements to Employee Share-Based Payment Accounting • The Company recorded a tax benefit of $1.7 million within income tax expense related to the excess tax benefits of the settlement or vesting of time-based restricted stock or time-based restricted stock units and performance-based restricted stock or performance-based restricted stock units. The Company applied this guidance prospectively as of January 1, 2016 and, accordingly, data for the prior years ended December 31, 2015 and 2014 were not adjusted. Prior to adoption this amount would have been recorded as an increase in additional paid-in capital. Going forward, this change could create volatility in the Company’s effective tax rate. • The Company elected to change its policy on accounting for forfeitures and recognize forfeitures as they occur. The Company applied this guidance on a modified retrospective transition method. The Company determined that the cumulative effect of applying the guidance under the modified retrospective transition method was not material to its Consolidated Financial Statements • Excess tax benefits are now reported as an operating activity in the Company’s Consolidated Statements of Cash Flows, rather than as a financing activity as was previously reported. As the Company applied this guidance prospectively as of January 1, 2016, excess tax benefits for the years ended December 31, 2015 and December 31, 2014 were not adjusted and continue to be reported in financing activities in the Consolidated Statements of Cash Flows. • The standard requires the presentation of employee taxes as a financing activity in the Consolidated Statements of Cash Flows. This provision did not impact the Company’s Consolidated Financial Statements as the Company currently presents employee taxes as a financing activity in its Consolidated Statements of Cash Flows. The Company excluded the excess tax benefits from the assumed proceeds available to repurchase shares in the computation of diluted earnings per share for 2016, which did not materially increase the diluted weighted average common shares outstanding. Data reported in Note 14, “ Interim Financial Data (Unaudited), New Accounting Standards Not Yet Adopted In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers, In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842).” The standard requires lessees to recognize leases on the balance sheet as a right-of-use asset and a lease liability, other than leases that meet the definition of a short-term lease. The liability will be equal to the present value of the lease payments. The asset will be based on the liability, subject to adjustment. For income statement purposes, the leases will continue to be classified as either operating or finance. Operating leases will result in straight-line expense (similar to current operating leases) and finance leases will result in a front-loaded expense pattern (similar to current capital leases). The standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted. The standard must be adopted using the modified retrospective transition method and provides for the option to elect a package of practical expedients upon adoption. The Company intends to adopt the standard in the first quarterly period of fiscal 2019, and is currently assessing the impact of adoption of the standard on its consolidated financial statements and related note disclosures. The Company has not made any decision on the option to elect adoption of the practical expedients. In August 2016, the FASB issued ASU No. 2016-15, “ Statement of Cash flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments Reclassifications Certain prior year amounts have been reclassified to conform to the current year presentation. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Inventories | 3. INVENTORIES Inventories (at LIFO value) consist of the following as of December 31 (in thousands): 2016 2015 Finished goods $ 29,686 $ 24,961 Raw materials 20,231 21,384 Total FIFO (first-in, first out) inventories 49,917 46,345 Reserve to adjust inventories to LIFO value (21,371 ) (23,241 ) Total LIFO inventories $ 28,546 $ 23,104 Inventory is stated at the lower of LIFO cost or net realizable value. The Company periodically reviews its inventory for slow moving or obsolete items and writes down the related products to estimated net realizable value. 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 was no inventory reduction during 2016. There was an inventory reduction in 2015. However, the impact on the Company’s cost of sales was not material due the fact that the historical costs expensed during 2015 closely approximated the current year costs. |
Prepaid Expenses and Other Asse
Prepaid Expenses and Other Assets | 12 Months Ended |
Dec. 31, 2016 | |
Text Block [Abstract] | |
Prepaid Expenses and Other Assets | 4. PREPAID EXPENSES AND OTHER ASSETS Prepaid expenses and other assets consist of the following as of December 31 (in thousands): 2016 2015 Prepaid expenses $ 6,209 $ 1,897 Income tax receivable 4,024 5,134 Assets held for sale — 6,154 Other 167 224 Total prepaid expenses and other assets $ 10,400 $ 13,409 At December 31, 2015, assets held for sale consisted of assets at the idle Olive Branch, Mississippi facility (Olive Branch assets) consisting of land and buildings and measured at the lower of their carrying amount or fair value less cost to sell. Fair value was determined using the Level 3 fair value hierarchy classification and was based on management’s best estimate of market participants’ pricing of the assets, including input from broker and industry specialists, and considered the condition of the assets. |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | 5. PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consist of the following as of December 31 (in thousands): 2016 2015 Building and improvements $ 47,859 $ 47,209 Machinery and equipment 223,450 210,880 Furniture and fixtures 2,710 2,221 Forklifts and tractors 10,167 7,607 Computer equipment 10,481 9,575 Construction in process 4,172 11,032 Land 11,417 8,532 Total property, plant and equipment 310,256 297,056 Accumulated depreciation (206,970 ) (196,132 ) Total property, plant and equipment, net $ 103,286 $ 100,924 The Company had construction in process as of December 31, 2016 of approximately $4.2 million. The Company expects that the construction in process will be completed and put into service in the year ending December 31, 2017. Depreciation expense for the years ended December 31, 2016, 2015, and 2014 totaled $14.2 million, $14.3 million and $14.8 million, respectively. During December 2015, the Company reclassified the Olive Branch assets from “Property, plant and equipment, net,” to assets held for sale in “Prepaid expenses and other assets” in the Consolidated Balance Sheet. The transfer to a held for sale category was due to the signing of letters of intent to sell certain of the Olive Branch assets. Upon transfer during December 2015, the Company measured the Olive Branch assets at the lower of their carrying amount or fair value less cost to sell, and recognized a loss of $0.5 million, which is reported in “Selling, general and administrative expenses” in the Consolidated Statements of Comprehensive Income for the year ended December 31, 2015. In January 2016, the Company sold a portion of the Olive Branch facility that contained the buildings for $4.2 million and recognized a $0.1 million gain on sale, which is reported in “Selling, general and administrative expenses” in the Consolidated Statements of Comprehensive Income. As of December 31, 2016, the Company continues to own approximately 62 acres of undeveloped land that is reported in “Property, plant and equipment, net” in the Consolidated Balance Sheet. |
Accrued Expenses
Accrued Expenses | 12 Months Ended |
Dec. 31, 2016 | |
Payables and Accruals [Abstract] | |
Accrued Expenses | 6. ACCRUED EXPENSES Accrued expenses consist of the following (in thousands): 2016 2015 Sales and marketing costs $ 16,707 $ 11,928 Compensation and benefits 13,298 11,217 Manufacturing costs 1,799 1,732 Rent obligations 632 664 Other 2,257 3,350 Total accrued expenses $ 34,693 $ 28,891 |
Debt
Debt | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Debt | 7. DEBT The Company’s debt consists of a revolving credit facility. At December 31, 2016, the Company had no outstanding indebtedness. Available borrowing capacity at December 31, 2016, was $200 million. At December 31, 2015, the Company had $7.0 million of outstanding indebtedness, and the interest rate on the revolving credit facility was 1.39%. Revolving Credit Facility Indebtedness after December 31, 2015 Under the Third Amended Credit Agreement, the Lenders agree to provide the Company with one or more revolving loans in a collective maximum principal amount of $250 million from January 1 through June 30 of each year and a maximum principal amount of $200 million from July 1 through December 31 of each year throughout the term, which ends January 12, 2021. Included within the revolving loan limit are sublimits for a letter of credit facility in an amount not to exceed $15 million and swing line loans in an aggregate principal amount at any time outstanding not to exceed $5 million. The revolving loans, the letter of credit facility and the swing line loans are for the purpose of funding working capital needs and supporting general business operations. Additionally, within the Revolving Loan Limit, the Company could borrow, repay, and reborrow, at any time or from time to time while the Third Amended Credit Agreement is in effect. The Company has the option to select interest rates for each loan request at the Base Rate or Eurodollar Rate. Base rate loans under the revolving loans and the swing line loans accrue interest at the Base Rate plus the Applicable Rate. Eurodollar Rate Loans for the revolving loans and swing line loans accrue interest at the Adjusted London InterBank Offered Rate plus the Applicable Rate. The Base Rate for any day is a fluctuating rate per annum equal to the highest of (a) the Federal Funds Rate plus 0.50%, (b) the rate of interest in effect for such day as publicly announced from time to time by BOA as its prime rate, and (c) the Eurodollar Rate plus 1.0%. Repayment of all then outstanding principal, interest, fees and costs is due on January 12, 2021. The Company shall reimburse BOA for all amounts payable, including interest, under a letter of credit at the earlier of (i) the date set forth in the application, or (ii) one business day after the payment under such letter of credit by BOA. The Third Amended Credit Agreement is secured by property with respect to which liens in favor of the Administrative Agent, for the benefit of itself and the other holders of the obligations, are purported to be granted pursuant to and in accordance with the terms of the collateral documents as referenced in the Third Amended Credit Agreement. Indebtedness through December 31, 2015 The Second Amended Credit Agreement provided the Company with one or more revolving loans in a collective maximum principal amount of $150 million from January 1 through June 30 of each year and a maximum principal amount of $100 million from July 1 through December 31 of each year (Revolving Loan Limit) throughout the term of November 20, 2019. Included within the Revolving Loan Limit were sublimits for a letter of credit facility in an amount not to exceed $15 million and swing advances in an aggregate principal amount at any time outstanding not to exceed $5 million. The Revolver Loans, the Letter of Credit Facility and the Swing Advance loans were for the purpose of raising working capital and supporting general business operations. The Company was not obligated to borrow any amount under the Revolving Loan Limit. Additionally, within the Revolving Loan Limit, the Company could borrow, repay, and reborrow, at any time or from time to time while the Second Amended Credit Agreement is in effect. Base Rate Advances (as defined in the Second Amended Credit Agreement) under the Revolver Loans and the Swing Advances accrued interest at the Base Rate plus the Applicable Margin (as defined in the Second Amended Credit Agreement) and Euro-dollar Advances for the Revolver Loans and Swing Advances accrued interest at the Adjusted London InterBank Offered Rate plus the Applicable Margin (as defined in the Second Amended Credit Agreement). The Company was required to reimburse BB&T for all amounts payable, including interest, under a Letter of Credit at the earlier of (i) the date set forth in the application, or (ii) one business day after the payment under such Letter of Credit by BB&T. The Second Amended Credit Agreement was secured by interest in real property owned by us and certain collateral (as described in the Second Amended and Restated Security Agreement and Intellectual Property Security Agreement). Compliance with Debt Covenants and Restrictions . |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Stockholders' Equity | 8. 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): Year Ended December 31, 2016 2015 2014 Numerator: Net income $ 67,847 $ 48,098 $ 41,521 Denominator: Basic weighted average shares outstanding 29,394,559 31,350,542 32,319,649 Effect of dilutive securities: SARS and options 125,119 197,299 262,730 Restricted stock 92,991 134,668 168,695 Diluted weighted average shares outstanding 29,612,669 31,682,509 32,751,074 Basic earnings per share $ 2.31 $ 1.53 $ 1.28 Diluted earnings per share $ 2.29 $ 1.52 $ 1.27 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: Year Ended December 31, 2016 2015 2014 Restricted stock and stock options 12 501 2,633 Stock appreciation rights 4,631 5,828 1,969 Stock Repurchase Programs On February 19, 2014, the Board of Directors authorized a common stock repurchase program of up to $50 million shares of the Company’s outstanding common stock (February 2014 Stock Repurchase Program). This authorization had no expiration date. During 2014, the Company repurchased 1,657,919 shares for $50.0 million, which completed the authorization under the February 2014 Stock Repurchase Program. On October 23, 2014, the Board of Directors authorized a common stock repurchase program of up to 2.0 million shares of the Company’s outstanding common stock (October 2014 Stock Repurchase Program). This authorization had no expiration date. During 2015, the Company repurchased 1,134,300 shares for $45.2 million under the October 2014 Stock Repurchase Program. On October 22, 2015, the Board of Directors terminated the October 2014 Stock Repurchase Program and adopted a new stock repurchase program of up to 3.15 million shares of the Company’s outstanding common stock (October 2015 Stock Repurchase Program). This authorization terminated on December 31, 2016. During 2016, the Company repurchased 1,578,952 shares for $53.3 million under the October 2015 Stock Repurchase Program. On February 16, 2017, the Board of Directors authorized a common stock repurchase program of up to 2.961 million shares of the Company’s outstanding common stock (February 2017 Stock Repurchase Program). As of the date of this report, the Company has made no repurchases under the February 2017 Stock Repurchase Program. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | 9. STOCK-BASED COMPENSATION On April 30, 2014, the Company’s stockholders approved the Trex Company, Inc. 2014 Stock Incentive Plan (Plan), which was previously approved by the Board of Directors on February 19, 2014. The Plan amended and restated in its entirety the Trex Company, Inc. 2005 Stock Incentive Plan, as previously disclosed. 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, restricted stock, restricted stock units, stock appreciation rights (SARs), and unrestricted stock. The total aggregate number of shares of the Company’s common stock that may be issued under the Plan is 6,420,000. 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 for 1 year, cumulative 2 years and cumulative 3 years, respectively. The number of shares that vest, with respect to each vesting, will be between 0% and 200% of the target number of shares. In 2015, the Company began issuing restricted stock units in lieu of restricted stock. Accordingly, time-based restricted stock units replaced time-based restricted stock and performance-based restricted stock units replaced performance-based restricted stock. The vesting terms of the restricted stock units are identical to the vesting provisions of the restricted stock. 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 and performance-based restricted stock units, expense is recognized ratably over the performance and vesting period of each tranche based on management’s judgment of the ultimate award that is probable to be paid out based on the achievement of the predetermined performance measures. For the employee stock purchase plan, compensation expense is recognized related to the discount on purchases. The following table summarizes the Company’s stock-based compensation expense for the years ended December 31, 2016, 2015 and 2014 (in thousands): Year Ended December 31, 2016 2015 2014 Time-based restricted stock and time-based restricted stock units $ 2,281 $ 2,704 $ 2,974 Performance-based restricted stock and performance-based restricted stock units 2,210 1,562 727 Stock appreciation rights 184 525 1,035 Employee stock purchase plan 113 70 71 Total stock-based compensation $ 4,788 $ 4,861 $ 4,807 Stock-based compensation expense is included in “Selling, general and administrative expenses” in the accompanying Consolidated Statements of Comprehensive Income. Time-Based Restricted Stock and Time-Based Restricted Stock Units The fair value of time-based restricted stock and time-based restricted stock units is determined based on the closing price of the Company’s shares on the grant date. Time-based restricted stock and time-based restricted stock units vest based on the terms of the awards. Unvested time-based restricted stock and unvested time-based restricted stock units are generally forfeitable upon the resignation of employment or termination of employment with cause. The total fair value of vested time-based restricted shares and vested time-based restricted stock units for the years ended December 31, 2016, 2015 and 2014 was $1.7 million, $9.8 million, and $3.9 million, respectively. At December 31, 2016, there was $1.5 million of total compensation expense related to unvested time-based restricted stock and unvested time-based restricted stock units remaining to be recognized over a weighted-average period of approximately 1.6 years. Time-based restricted stock activity under the Plan and all predecessor stock incentive plans is as follows: Time-based Weighted-Average Nonvested at December 31, 2013 382,974 $ 13.78 Granted 66,511 $ 32.70 Vested (116,641 ) $ 33.73 Forfeited (3,282 ) $ 16.61 Nonvested at December 31, 2014 329,562 $ 18.89 Granted 57,598 $ 43.81 Vested (230,704 ) $ 42.37 Forfeited (48,549 ) $ 20.20 Nonvested at December 31, 2015 107,907 $ 29.43 Granted 57,874 $ 37.64 Vested (43,848 ) $ 42.34 Forfeited (133 ) $ 43.89 Nonvested at December 31, 2016 121,800 $ 31.59 Performance-based Restricted Stock and Performance-Based Restricted Stock Units The fair value of performance-based restricted stock and performance-based restricted stock units is determined based on the closing price of the Company’s shares on the grant date. Unvested performance-based restricted stock and unvested performance-based restricted stock units are generally forfeitable upon the resignation of employment or termination of employment with cause. The performance-based restricted shares and performance-based restricted stock units have a three-year vesting period, vesting one-third each year based on target earnings before interest, taxes, depreciation and amortization (EBITDA) for 1 year, cumulative 2 years and cumulative 3 years, respectively. The number of shares that will vest, with respect to each vesting, will be between 0% and 200% of the target number of shares. At December 31, 2016 and 2015, there was $1.2 million and $0.6 million, respectively, of total compensation expense related to unvested performance-based restricted stock and unvested performance-based restricted stock units remaining to be recognized over a weighted-average period of approximately 2.0 years. Performance-based restricted stock activity under the Plan is as follows: Performance-based Performance-based Weighted-Average Nonvested at December 31, 2014 42,676 $ 33.72 Granted 34,638 $ 43.89 Vested (35,679 ) $ 41.91 Forfeited (12,538 ) $ 38.12 Nonvested at December 31, 2015 29,097 $ 39.38 Granted 44,925 $ 35.83 Vested (14,949 ) $ 35.71 Forfeited (657 ) $ 33.72 Nonvested at December 31, 2016 58,416 $ 36.63 Stock Appreciation Rights SARs are granted with a grant price equal to the closing market price of the Company’s common stock on the date of grant. These awards expire ten years after the date of grant and vest based on the terms of the individual awards. The SARs are generally forfeitable upon the resignation of employment or termination of employment with cause. The Company recognizes compensation cost on a straight-line basis over the vesting period for the award. As of December 31, 2016, there was no unrecognized compensation cost related to SARs. The fair value of each SAR is estimated on the date of grant using a Black-Scholes option-pricing model. There were no SARs issued in the year ended December 31, 2016. For SARs issued in the years ended December 31, 2015 and 2014, respectively, the assumptions shown in the following table were used: December 31, 2015 2014 Dividend yield 0 % 0 % Average risk-free interest rate 1.6 % 1.7 % Expected term (years) 5 5 Expected volatility 42.9 % 52.6 % Dividend Yield. Average Risk-Free Interest Rate. Expected Term. Expected Volatility. The Company recognizes forfeitures as they occur. The weighted-average grant date fair value of SARs granted during the years ended December 31, 2015 and 2014 was $16.26, and $17.78, respectively. SAR activity under the Plan and all predecessor stock incentive plans is as follows: SARs Weighted-Average Weighted- Average Aggregate 2016 Outstanding at December 31, 2013 739,194 $ 12.93 Granted 3,866 $ 37.88 Exercised (218,826 ) $ 10.96 Canceled (8,404 ) $ 4.74 Outstanding at December 31, 2014 515,830 $ 13.98 Granted 15,585 $ 41.19 Exercised (263,626 ) $ 13.86 Canceled (5,712 ) $ 21.94 Outstanding at December 31, 2015 262,077 $ 13.13 Granted — $ — Exercised (124,352 ) $ 11.09 Canceled — $ — Outstanding at December 31, 2016 137,725 $ 19.57 5.6 $ 6,174,886 Vested at December 31, 2016 127,469 $ 17.83 5.4 $ 5,936,639 Exercisable at December 31, 2016 127,469 $ 17.83 5.4 $ 5,936,639 Employee Stock Purchase Plan The Company has an employee stock purchase plan (ESPP) that permits eligible employees to purchase shares of common stock of the Company at a purchase price which is the lesser of 85% of the market price on either the first day of the calendar quarter or the last day of the calendar quarter. Eligible employees may elect to participate in the plan by authorizing payroll deductions of up to 15% of gross compensation for each payroll period. On the last day of each quarter, each participant’s contribution account is used to purchase the maximum number of whole shares of common stock determined by dividing the contribution account balance by the purchase price. The aggregate number of shares of common stock that may be purchased under the plan is 600,000. Through December 31, 2016, employees had purchased approximately 422,687 shares under the plan. Stock Options Stock options are granted with an exercise price equal to the closing market price of the Company’s common stock on the date of grant. These awards expire ten years after the date of grant and vest based on the terms of the individual awards. The options are generally forfeitable upon termination of a holder’s service as an employee or director, unless the individual’s service is terminated due to retirement, death or permanent disability. The fair value of each stock option award is estimated on the date of grant using a Black-Scholes option-pricing model. The Company recognizes compensation cost on a straight-line basis over the vesting period for the award. All outstanding options were exercised during fiscal 2015 and there were no stock options outstanding at December 31, 2015 and 2016. Stock option activity under the Plan and all predecessor stock incentive plans is as follows: Options Weighted-Average Outstanding at December 31, 2013 42,288 $ 20.05 Granted — $ — Exercised (27,942 ) $ 35.73 Canceled (1,188 ) $ 17.92 Outstanding at December 31, 2014 13,158 $ 23.36 Granted — $ — Exercised (13,158 ) $ 50.37 Canceled — $ — Outstanding at December 31, 2015 — $ — |
Leases
Leases | 12 Months Ended |
Dec. 31, 2016 | |
Leases [Abstract] | |
Leases | 10. LE SES The Company leases office space, storage warehouses and certain office and plant equipment under various operating leases. Minimum annual payments under these non-cancelable leases as of December 31, 2016 were as follows (in thousands): Year Ending December 31, 2017 $ 9,606 2018 9,271 2019 8,205 2020 6,477 2021 6,170 Thereafter 18,659 Total minimum lease payments $ 58,388 For the years ended December 31, 2016, 2015 and 2014, the Company recognized rental expenses of approximately $9.9 million, $7.7 million and $7.5 million, respectively. For information related to the Company’s reconsidered corporate headquarters lease agreement, see Note 13. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2016 | |
Postemployment Benefits [Abstract] | |
Employee Benefit Plans | 11. EMPLOYEE BENEFIT PLANS The Company has a 401(k) Profit Sharing Plan for the benefit of all employees who meet certain eligibility requirements. The plan covers substantially all of the Company’s full-time employees. The plan documents provide for the Company to match contributions equal to 100% of an employee’s contribution to the plan up to 6% of base salary. The Company’s contributions to the plan totaled $2.5 million, $2.2 million and $2.0 million for the years ended December 31, 2016, 2015 and 2014. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 12. INCOME TAXES Income tax provision (benefit) for the years ended December 31, 2016, 2015 and 2014 consists of the following (in thousands): Year Ended December 31, 2016 2015 2014 Current income tax provision: Federal $ 26,752 $ 25,105 $ 18,722 State 2,798 2,560 3,131 29,550 27,665 21,853 Deferred income tax provision: Federal 5,217 987 3,118 State 216 37 456 5,433 1,024 3,574 Total income tax provision $ 34,983 $ 28,689 $ 25,427 The income tax provision differs from the amount of income tax determined by applying the U.S. Federal statutory rate to income before taxes as a result of the following (in thousands): Year Ended December 31, 2016 2015 2014 U.S. Federal statutory taxes $ 35,990 $ 26,876 $ 23,432 State and local taxes, net of U.S. Federal benefit 3,747 2,806 2,856 Permanent items 396 1,308 249 Excess tax benefits from vesting or settlement of stock compensation awards (1,749 ) — — Domestic production activities deduction (2,740 ) (2,262 ) (1,117 ) Federal credits (488 ) (328 ) (214 ) Other (173 ) 289 221 Total income tax provision $ 34,983 $ 28,689 $ 25,427 Deferred tax assets and liabilities as of December 31, 2016 and 2015 consist of the following (in thousands): As of December 31, 2016 2015 Deferred tax assets: Net operating losses $ 93 $ 138 Warranty reserve 14,510 12,904 Stock-based compensation 2,186 1,554 Accruals not currently deductible and other 2,261 6,195 Inventories 5,785 4,406 State tax credit carryforwards 4,020 4,350 Gross deferred tax assets, before valuation allowance 28,855 29,547 Valuation allowance (4,061 ) (4,582 ) Gross deferred tax assets, after valuation allowance 24,794 24,965 Deferred tax liabilities: Depreciation and other (25,688 ) (20,426 ) Gross deferred tax liabilities (25,688 ) (20,426 ) Net deferred tax (liability) asset $ (894 ) $ 4,539 The Company recognizes deferred tax assets and liabilities based on the difference between the financial statement basis and tax basis of assets and liabilities using enacted rates expected to be in effect during the year in which the differences reverse. In accordance with accounting standards, the Company assesses the likelihood that its deferred tax assets will be realized. Deferred tax assets are reduced by a valuation allowance when, after considering all available positive and negative evidence, it is determined that it is more likely than not that some portion, or all, of the deferred tax asset will not be realized. As of December 31, 2016, the Company had a valuation allowance of $4.1 million against deferred tax assets it estimates will not be realized. The Company will analyze its position in subsequent reporting periods, considering all available positive and negative evidence, in determining the expected realization of its deferred tax assets. In 2016, the Company adopted ASU No. 2016-09, “ Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting The Company recognizes interest and penalties related to tax matters as a component of “Selling, general and administrative expenses” in the accompanying Consolidated Statements of Comprehensive Income. As of December 31, 2016, the Company has identified no uncertain tax position and, accordingly, has not recorded any unrecognized tax benefits or associated interest and penalties. 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 has accrued a liability when it believes that it is not more likely than not that it will realize the benefits of tax positions that it has taken or for the amount of any tax benefit that exceeds the cumulative probability threshold in accordance with accounting standards. As of December 31, 2016, Federal tax years 2013 through 2016 remain subject to examination. The Company believes that adequate provisions have been made for all tax returns subject to examination. Sales made to foreign distributors are not taxable in any foreign jurisdictions as the Company does not have a taxable presence. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 13. COMMITMENTS AND CONTINGENCIES Legal Matters The Company has 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 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. Purchase Commitments The Company fulfills requirements for raw materials under both purchase orders and supply contracts. In the year ended December 31, 2016, the Company purchased substantially all of its reclaimed wood fiber requirements under purchase orders which do not involve long-term supply commitments. All of the Company’s scrap polyethylene purchases are under short-term supply contracts that average approximately one to two years, for which pricing is negotiated as needed, or under purchase orders that do not involve long-term supply commitments. The wood and polyethylene supply contracts generally provide that the Company is obligated to purchase all of the wood or polyethylene a supplier provides, if the wood or polyethylene meets certain specifications. The amount of wood and polyethylene the Company is required to purchase under these contracts varies with the production of its suppliers and, accordingly, is not fixed or determinable. As of December 31, 2016, the Company has purchase commitments under material supply contracts of $20.2 million, $3.2 million, $0.35 million and $0.05 million for the years ending December 31, 2017, 2018, 2019 and 2020, respectively. Contract Termination Costs The Company leases 55,047 square feet of office and storage space in Dulles, Virginia, that it does not occupy, but has sublet all of the office space for the remainder of the term of its lease obligation, which ends June 30, 2019. The future sublease receipts are less than the remaining minimum lease payment obligations under the Company’s lease. Accordingly, the Company has recorded a liability for the present value of the shortfall. As of December 31, 2016, the minimum payments remaining under the Company’s lease over the years ending December 31, 2017, 2018, and 2019 are $1.9 million, $2.0 million, and $1.0 million, respectively. The net minimum receipts remaining under the Company’s existing subleases over the years ending December 31, 2017, 2018, and 2019 are $1.3 million, $1.3 million, and $0.7 million, respectively. The following table provides information about the Company’s liability under the lease (in thousands): 2016 2015 Beginning balance, January 1 $ 2,106 $ 3,033 Net rental payments (691 ) (1,352 ) Accretion of discount 145 220 (Decrease) increase in net estimated contract termination costs (85 ) 205 Ending balance, December 31 $ 1,475 $ 2,106 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, excluding Trex Signature™ Railing, which has a warranty period of 25 years for both residential and commercial use. The Company further warrants that Trex Transcend ® ® ® The Company continues to receive and settle claims for products manufactured at its Nevada facility prior to 2007 that exhibit surface flaking 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. To estimate the number of claims to be settled with payment, the Company utilizes actuarial techniques to determine a reasonable possible range of claims to be received and the percentage of those claims that will ultimately require payment. Management utilizes a range of assumptions derived from claim count history and the identification of factors influencing the claim counts to determine its best estimate of future claims for which to record a related liability. The number of claims received has declined each year since peaking in 2009, although the rate of decline has decelerated in recent years. Additionally, events such as the 2009 settlement of a class action lawsuit covering the surface defect and communications by the Company in 2013 informing homeowners of potential hazards associated with products exhibiting surface flaking that are not timely replaced, have obscured observable trends in historical claims activity. The cost per claim varies due to a number of factors, including the size of affected decks, the availability and 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. Typically, a majority of surface flaking claims received in a year are received during the summer outdoor season, which spans the second and third quarters. It has been the Company’s practice to utilize the actuarial techniques discussed above during the third quarter, after a significant portion of all claims has been received for the fiscal year and variances to annual claims expectations are more meaningful. The number of claims received in the year ended December 31, 2016 was lower than claims received in the year ended December 31, 2015, continuing the historical year-over-year decline in incoming claims, but was higher than the Company’s expectations. Also, the average settlement cost per claim experienced in the year ended December 31, 2016 was higher than the average settlement cost per claim experienced during the year ended December 31, 2015 and higher than the Company’s expectation for 2016. As a result and after actuarial review, the Company revised its estimate and recorded an increase to the warranty reserve of $9.8 million during the third quarter of 2016. Based on the facts and circumstances at December 31, 2016, the Company believes its reserve is sufficient to cover future surface flaking obligations. The Company notes that its annual cash outflows for surface flaking claims declined by $1.5 million, or 21%, in 2016 compared to 2015, and declined by $1.7 million, or 19%, in 2015 compared to 2014. The Company’s analysis is based on currently known facts and a number of assumptions, as discussed above, and current expectations. 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 flows. The Company estimates that the annual number of claims received will continue to decline over time and that the average cost per claim will increase slightly, primarily due to inflation. If the level of claims received or average cost per claim differs materially from expectations, it could result in additional increases or decreases to the warranty reserve and a decrease or increase in 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 $3.4 million change in the surface flaking warranty reserve. The following is a reconciliation of the Company’s warranty reserve that represents amounts accrued for surface flaking claims (in thousands): 2016 2015 Beginning balance, January 1 $ 29,673 $ 31,419 Changes in estimates related to pre-existing warranties 9,835 5,426 Settlements made during the period (5,661 ) (7,172 ) Ending balance, December 31 $ 33,847 $ 29,673 The remainder of the Company’s warranty reserve represents amounts accrued for non-surface flaking claims. |
Interim Financial Data (Unaudit
Interim Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Interim Financial Data (Unaudited) | 14. INTERIM FINANCIAL DATA (Unaudited) Three Months Ended December 31, September 30, June 30, March 31, December 31, September 30, June 30, March 31, (In thousands, except share and per share data) Net sales 95,322 106,168 146,450 131,676 89,202 94,023 136,779 120,800 Gross profit 38,113 29,945 61,410 57,627 31,955 22,143 52,524 48,247 Net income 12,629 7,787 23,725 23,706 8,086 3,744 18,715 17,553 Basic net income per share $ 0.43 $ 0.27 $ 0.81 $ 0.80 $ 0.26 $ 0.12 $ 0.59 $ 0.55 Basic weighted average common shares outstanding 29,318,915 29,295,284 29,264,362 29,697,722 30,766,943 31,227,643 31,735,333 31,683,672 Diluted net income per share $ 0.43 $ 0.26 $ 0.80 $ 0.79 $ 0.26 $ 0.12 $ 0.58 $ 0.55 Diluted weighted average common shares outstanding 29,543,842 29,516,718 29,477,870 29,910,292 30,966,682 31,537,010 32,142,939 32,094,828 The Company’s net sales, gross profit and income from operations have historically varied from quarter to quarter. Such variations are often attributable to seasonal trends in the demand for Trex products. 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. The Company elected to early adopt ASU No. 2016-09, “ Compensation – Stock Compensation (Topic 718) Improvements to Employee Share-Based Payment Accounting Summary of Significant Accounting Policies: Recently Adopted Accounting Standards, Three Months Ended September 30, 2016 June 30, 2016 March 31, 2016 As Reported Adjusted As Reported Adjusted As Reported Adjusted (In thousands, except share and per share data) Net income $ 6,898 $ 7,787 $ 23,279 $ 23,725 $ 23,402 $ 23,706 Basic net income per share $ 0.24 $ 0.27 $ 0.80 $ 0.81 $ 0.79 $ 0.80 Diluted net income per share $ 0.23 $ 0.26 $ 0.79 $ 0.80 $ 0.78 $ 0.79 Diluted weighted average common shares outstanding 29,457,653 29,516,718 29,423,845 29,477,870 29,860,730 29,910,292 |
Schedule II - Valuation and Qua
Schedule II - Valuation and Qualifying Accounts and Reserves | 12 Months Ended |
Dec. 31, 2016 | |
Valuation and Qualifying Accounts [Abstract] | |
Schedule II - Valuation and Qualifying Accounts and Reserves | TREX COMPANY, INC. (In Thousands) Descriptions Balance at Additions Deductions Balance Year ended December 31, 2016: Warranty reserve $ 33,522 $ 10,852 $ (6,682 ) $ 37,692 Income tax valuation allowance $ 4,582 $ — $ (521 ) $ 4,061 Year ended December 31, 2015: Warranty reserve $ 33,841 $ 8,515 $ (8,834 ) $ 33,522 Income tax valuation allowance $ 4,465 $ 117 $ — $ 4,582 Year ended December 31, 2014: Warranty reserve $ 40,812 $ 3,774 $ (10,745 ) $ 33,841 Income tax valuation allowance $ 4,201 $ 388 $ (124 ) $ 4,465 |
Summary of Significant Accoun22
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Basis of Accounting | Basis of Accounting The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States and include the accounts of the Company and its wholly-owned subsidiary, Trex Wood-Polymer Espana, S.L. (TWPE). Intercompany accounts and transactions have been eliminated in consolidation. TWPE was formed to hold the Company’s 35% equity interest in Denplax, S.A. (Denplax), a venture with a Spanish company responsible for public environmental programs in southern Spain and with an Italian equipment manufacturer. The venture was formed to recycle polyethylene at a facility in El Ejido, Spain. The Company’s investment in Denplax is accounted for using the equity method. During 2010, the Company determined that its investment in Denplax and a related note receivable were no longer recoverable and recorded a $2.4 million charge to earnings to fully reserve the equity investment and note. Both the equity investment and note remain fully reserved as of December 31, 2016. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and the accompanying notes. Actual results could differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash equivalents consist of highly liquid investments purchased with original maturities of three months or less. |
Concentrations and Credit Risk | Concentrations and Credit Risk The Company’s financial instruments that are exposed to concentrations of credit risk consist primarily of cash and cash equivalents and trade accounts receivable. The Company from time to time may have bank deposits in excess of insurance limits of the Federal Deposit Insurance Corporation. As of December 31, 2016, substantially all deposits are maintained in one financial institution. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk related to its cash and cash equivalents. The Company routinely assesses the financial strength of its customers and believes that its trade receivables credit risk exposure is limited. Trade receivables are carried at the original invoice amount less an estimate made for payment discounts and doubtful accounts. A valuation allowance is provided for known and anticipated credit losses and disputed amounts, as determined by management in the course of regularly evaluating individual customer receivables. This evaluation takes into consideration a customer’s financial condition and credit history, as well as current economic conditions. There was no valuation allowance recorded as of December 31, 2016 and 2015. In the years ended December 31, 2016, 2015 and 2014, sales to certain customers accounted for 10% or more of the Company’s total net sales. For the year ended December 31, 2016, two customers of the Company represented approximately 39% of the Company’s net sales. For the year ended December 31, 2015, one customer of the Company represented approximately 27% of the Company’s net sales. For the year ended December 31, 2014, one customer of the Company represented approximately 24% of the Company’s net sales. At December 31, 2016, four customers represented 30%, 16%, 14%, and 13%, respectively, of the Company’s accounts receivable balance. Approximately 33%, 35%, and 38% of the Company’s materials purchases for the years ended December 31, 2016, 2015 and 2014, respectively, were purchased from its four largest suppliers. |
Inventories | Inventories Inventories are stated at the lower of cost (last-in, first-out, or LIFO, method) or market value. The Company periodically reviews its inventory for slow moving or obsolete items and writes down the related products to estimated realizable value. The Company’s reserves for estimated slow moving products or obsolescence are not material. At December 31, 2016, the excess of the replacement cost of inventory over the LIFO value of inventory was approximately $21.4 million. Due to the nature of the LIFO valuation methodology, liquidations of inventories will result in a portion of the Company’s cost of sales being based on historical rather than current year costs. A majority of the Company’s products are made in a proprietary process that combines reclaimed wood fibers and scrap polyethylene. The Company grinds up scrap materials generated from its manufacturing process and inventories deemed no longer salable and reintroduces the reclaimed material into the manufacturing process as a substitute for raw materials. The reclaimed material is valued at the costs of the raw material components of the material. |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment are stated at historical cost. The costs of additions and improvements are capitalized, while maintenance and repairs are expensed as incurred. Depreciation is provided using the straight-line method over the following estimated useful lives: Buildings 40 years Machinery and equipment 3-11 years Furniture and equipment 10 years Forklifts and tractors 5 years Computer equipment and software 5 years Leasehold improvements are amortized over the shorter of the lease term or the estimated useful life of the asset. The Company reviews its long-lived assets, including property, plant and equipment, whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. To determine the recoverability of its long-lived assets, the Company evaluates the probability that future estimated undiscounted net cash flows will be less than the carrying amount of the long-lived assets. If the estimated cash flows are less than the carrying amount of the long-lived assets, the assets are written down to their fair value. The Company’s estimates of anticipated cash flows and the remaining estimated useful lives of long-lived assets could be reduced in the future. As a result, the carrying amount of long-lived assets could be reduced in the future. Long-lived assets held for sale are stated at the lower of cost or fair value less cost to sell. |
Fair Value Measurement | Fair Value Measurement Assets and liabilities measured at fair value are measured at the amount that would be received for selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date and classified into one of the following fair value hierarchy: • Level 1 – Quoted prices for identical instruments in active markets. • Level 2 – Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model derived valuations in which all significant inputs and significant value drivers are observable in active markets. • Level 3 – Valuations derived from management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. |
Contract Termination Costs | Contract Termination Costs The Company leases 55,047 square feet of office and storage space in Dulles, Virginia, that it does not occupy, but has sublet all of the office space for the remainder of the term of its lease obligation, which ends June 30, 2019. The future sublease receipts are less than the remaining minimum lease payment obligations under the Company’s lease. Accordingly, the Company has recorded a liability for the present value of the shortfall. |
Goodwill | Goodwill Goodwill represents the excess of cost over net assets acquired resulting from the Company’s 1996 purchase of the Mobil Composite Products Division and the 2011 purchase of the assets of the Iron Deck Corporation. The Company evaluates the recoverability of goodwill in accordance with Accounting Standard Codification Topic 350, “ Intangibles – Goodwill and Other The Company first assesses qualitative factors to determine if it is more likely than not that the fair value of the reporting unit is less than its carrying amount to determine if it should proceed with the evaluation of goodwill for impairment. If the Company proceeds with the two-step impairment test, the Company first compares the fair value of the reporting unit to its carrying value. If the carrying value of a reporting unit exceeds its fair value, the goodwill of that reporting unit is potentially impaired and step two of the impairment analysis is performed. In step two of the analysis, an impairment loss is recorded equal to the excess of the carrying value of the reporting unit’s goodwill over its implied fair value should such a circumstance arise. The Company measures fair value of the reporting unit based on a present value of future discounted cash flows and a market valuation approach. The discounted cash flows model indicates the fair value of the reporting unit based on the present value of the cash flows that the reporting unit is expected to generate in the future. Significant estimates in the discounted cash flows model include: the weighted average cost of capital; long-term rate of growth and profitability of the business; and working capital effects. The market valuation approach indicates the fair value of the business based on a comparison of the Company against certain market information. Significant estimates in the market approach model include identifying appropriate market multiples and assessing earnings before interest, income taxes, depreciation and amortization (EBITDA) in estimating the fair value of the reporting unit. For the years ended December 31, 2016, 2015 and 2014, the Company completed its annual impairment test of goodwill and noted no impairment. The Company performs the annual impairment testing of its goodwill as of October 31 of each year. However, actual results could differ from the Company’s estimates and projections, which would affect the assessment of impairment. As of December 31, 2016, the Company had goodwill of $10.5 million that is reviewed annually for impairment. |
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 Trex Signature ® ® ® ® |
Treasury Stock | Treasury Stock The Company records the repurchase of shares of its common stock at cost. These shares are considered treasury stock, which is a reduction to stockholders’ equity. Treasury stock is included in authorized and issued shares but excluded from outstanding shares. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue when title is transferred to customers, which is generally upon shipment of the product to the customer. The Company does not grant contractual product return rights to customers other than pursuant to its product warranty. The Company does not expect future product returns to be material and, consequently, does not maintain an allowance for product returns. The Company records all shipping and handling fees in sales and records all of the related costs in cost of sales. The Company offers sales incentive programs to dealers and distributors, including rebates, pricing discounts, favorable payment terms and cooperative advertising, many of which result in cash consideration made to dealers and distributors. The Company accounts for consideration made pursuant to these programs in accordance with accounting guidance that governs consideration given by a vendor to a customer . |
Stock-Based Compensation | Stock-Based Compensation The Company measures stock-based compensation at the grant date of the award based on the fair value. For stock options, stock appreciation rights and time-based restricted stock and time-based restricted stock units, stock-based compensation is recognized on a straight line basis over the vesting periods of the award. The Company recognizes forfeitures as they occur. For performance-based restricted stock and performance-based restricted stock units, expense is recognized ratably over the performance and vesting period of each tranche based on management’s judgment of the ultimate award that is probable to be paid out based on the achievement of predetermined performance measures. Stock-based compensation expense is included in “Selling, general and administrative expenses” in the accompanying Consolidated Statements of Comprehensive Income. On April 30, 2014, the Company’s stockholders approved the Trex Company, Inc. 2014 Stock Incentive Plan (Plan), which was previously approved by the Board of Directors on February 19, 2014. The Plan amended and restated in its entirety the Trex Company, Inc. 2005 Stock Incentive Plan, as previously disclosed. 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, restricted stock, restricted stock units, stock appreciation rights (SARs), and unrestricted stock. The total aggregate number of shares of the Company’s common stock that may be issued under the Plan is 6,420,000. 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 In 2015, the Company began issuing restricted stock units in lieu of restricted stock. Accordingly, time-based restricted stock units replaced time-based restricted stock and performance-based restricted stock units replaced performance-based restricted stock. The vesting terms of the restricted stock units are identical to the vesting provisions of the restricted stock. |
Income Taxes | Income Taxes The Company recognizes deferred tax assets and liabilities based on the difference between the financial statement basis and tax basis of assets and liabilities using enacted rates expected to be in effect during the year in which the differences reverse. The Company assesses the likelihood that its deferred tax assets will be realized. Deferred tax assets are reduced by a valuation allowance when, after considering all available positive and negative evidence, it is determined that it is more likely than not that some portion, or all, of the deferred tax asset will not be realized. As of December 31, 2016, the Company has a valuation allowance of $4.1 million against these deferred tax assets. The Company analyzes its position in subsequent reporting periods, considering all available positive and negative evidence, in determining the expected realization of its deferred tax assets. |
Research and Development Costs | Research and Development Costs Research and development costs are expensed as incurred. For the years ended December 31, 2016, 2015 and 2014, research and development costs were $3.7 million, $1.5 million and $2.3 million, respectively, and have been included in “Selling, general and administrative expenses” in the accompanying Consolidated Statements of Comprehensive Income. |
Advertising Costs | Advertising Costs The Company expenses its branding and advertising communication costs as incurred. Significant production costs are deferred and recognized as expense in the period that the related advertisement is first used. At December 31, 2016 and December 31, 2015, $2.4 million and $0.8 million, respectively, were included in prepaid expenses for production costs. For the years ended December 31, 2016, 2015 and 2014, branding expenses, including advertising expenses as described above, were $24.8 million, $23.4 million and $20.8 million, respectively. |
Fair Value of Financial Instruments | Fair Value of 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 December 31, 2016 and 2015. |
Recently Adopted Accounting Standards | Recently Adopted Accounting Standards In November 2015, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2015-17, “ Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes In March 2016, the FASB issued ASU No. 2016-09, “ Compensation – Stock Compensation (Topic 718) Improvements to Employee Share-Based Payment Accounting • The Company recorded a tax benefit of $1.7 million within income tax expense related to the excess tax benefits of the settlement or vesting of time-based restricted stock or time-based restricted stock units and performance-based restricted stock or performance-based restricted stock units. The Company applied this guidance prospectively as of January 1, 2016 and, accordingly, data for the prior years ended December 31, 2015 and 2014 were not adjusted. Prior to adoption this amount would have been recorded as an increase in additional paid-in capital. Going forward, this change could create volatility in the Company’s effective tax rate. • The Company elected to change its policy on accounting for forfeitures and recognize forfeitures as they occur. The Company applied this guidance on a modified retrospective transition method. The Company determined that the cumulative effect of applying the guidance under the modified retrospective transition method was not material to its Consolidated Financial Statements • Excess tax benefits are now reported as an operating activity in the Company’s Consolidated Statements of Cash Flows, rather than as a financing activity as was previously reported. As the Company applied this guidance prospectively as of January 1, 2016, excess tax benefits for the years ended December 31, 2015 and December 31, 2014 were not adjusted and continue to be reported in financing activities in the Consolidated Statements of Cash Flows. • The standard requires the presentation of employee taxes as a financing activity in the Consolidated Statements of Cash Flows. This provision did not impact the Company’s Consolidated Financial Statements as the Company currently presents employee taxes as a financing activity in its Consolidated Statements of Cash Flows. The Company excluded the excess tax benefits from the assumed proceeds available to repurchase shares in the computation of diluted earnings per share for 2016, which did not materially increase the diluted weighted average common shares outstanding. Data reported in Note 14, “ Interim Financial Data (Unaudited), |
New Accounting Standards Not Yet Adopted | New Accounting Standards Not Yet Adopted In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers, In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842).” The standard requires lessees to recognize leases on the balance sheet as a right-of-use asset and a lease liability, other than leases that meet the definition of a short-term lease. The liability will be equal to the present value of the lease payments. The asset will be based on the liability, subject to adjustment. For income statement purposes, the leases will continue to be classified as either operating or finance. Operating leases will result in straight-line expense (similar to current operating leases) and finance leases will result in a front-loaded expense pattern (similar to current capital leases). The standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted. The standard must be adopted using the modified retrospective transition method and provides for the option to elect a package of practical expedients upon adoption. The Company intends to adopt the standard in the first quarterly period of fiscal 2019, and is currently assessing the impact of adoption of the standard on its consolidated financial statements and related note disclosures. The Company has not made any decision on the option to elect adoption of the practical expedients. In August 2016, the FASB issued ASU No. 2016-15, “ Statement of Cash flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments |
Reclassifications | Reclassifications Certain prior year amounts have been reclassified to conform to the current year presentation. |
Summary of Significant Accoun23
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Estimated Useful Lives of Property Plant and Equipment | Property, plant and equipment are stated at historical cost. The costs of additions and improvements are capitalized, while maintenance and repairs are expensed as incurred. Depreciation is provided using the straight-line method over the following estimated useful lives: Buildings 40 years Machinery and equipment 3-11 years Furniture and equipment 10 years Forklifts and tractors 5 years Computer equipment and software 5 years |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Summary of Inventories, at LIFO Value | Inventories (at LIFO value) consist of the following as of December 31 (in thousands): 2016 2015 Finished goods $ 29,686 $ 24,961 Raw materials 20,231 21,384 Total FIFO (first-in, first out) inventories 49,917 46,345 Reserve to adjust inventories to LIFO value (21,371 ) (23,241 ) Total LIFO inventories $ 28,546 $ 23,104 |
Prepaid Expenses and Other As25
Prepaid Expenses and Other Assets (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Text Block [Abstract] | |
Summary of Prepaid Expenses and Other Assets | Prepaid expenses and other assets consist of the following as of December 31 (in thousands): 2016 2015 Prepaid expenses $ 6,209 $ 1,897 Income tax receivable 4,024 5,134 Assets held for sale — 6,154 Other 167 224 Total prepaid expenses and other assets $ 10,400 $ 13,409 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property, Plant and Equipment | Property, plant and equipment consist of the following as of December 31 (in thousands): 2016 2015 Building and improvements $ 47,859 $ 47,209 Machinery and equipment 223,450 210,880 Furniture and fixtures 2,710 2,221 Forklifts and tractors 10,167 7,607 Computer equipment 10,481 9,575 Construction in process 4,172 11,032 Land 11,417 8,532 Total property, plant and equipment 310,256 297,056 Accumulated depreciation (206,970 ) (196,132 ) Total property, plant and equipment, net $ 103,286 $ 100,924 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Payables and Accruals [Abstract] | |
Summary of Accrued Expenses | Accrued expenses consist of the following (in thousands): 2016 2015 Sales and marketing costs $ 16,707 $ 11,928 Compensation and benefits 13,298 11,217 Manufacturing costs 1,799 1,732 Rent obligations 632 664 Other 2,257 3,350 Total accrued expenses $ 34,693 $ 28,891 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
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): Year Ended December 31, 2016 2015 2014 Numerator: Net income $ 67,847 $ 48,098 $ 41,521 Denominator: Basic weighted average shares outstanding 29,394,559 31,350,542 32,319,649 Effect of dilutive securities: SARS and options 125,119 197,299 262,730 Restricted stock 92,991 134,668 168,695 Diluted weighted average shares outstanding 29,612,669 31,682,509 32,751,074 Basic earnings per share $ 2.31 $ 1.53 $ 1.28 Diluted earnings per share $ 2.29 $ 1.52 $ 1.27 |
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: Year Ended December 31, 2016 2015 2014 Restricted stock and stock options 12 501 2,633 Stock appreciation rights 4,631 5,828 1,969 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Summary of Stock-Based Compensation Expense | The following table summarizes the Company’s stock-based compensation expense for the years ended December 31, 2016, 2015 and 2014 (in thousands): Year Ended December 31, 2016 2015 2014 Time-based restricted stock and time-based restricted stock units $ 2,281 $ 2,704 $ 2,974 Performance-based restricted stock and performance-based restricted stock units 2,210 1,562 727 Stock appreciation rights 184 525 1,035 Employee stock purchase plan 113 70 71 Total stock-based compensation $ 4,788 $ 4,861 $ 4,807 |
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 model. There were no SARs issued in the year ended December 31, 2016. For SARs issued in the years ended December 31, 2015 and 2014, respectively, the assumptions shown in the following table were used: December 31, 2015 2014 Dividend yield 0 % 0 % Average risk-free interest rate 1.6 % 1.7 % Expected term (years) 5 5 Expected volatility 42.9 % 52.6 % |
SAR Activity | SAR activity under the Plan and all predecessor stock incentive plans is as follows: SARs Weighted-Average Weighted- Average Aggregate 2016 Outstanding at December 31, 2013 739,194 $ 12.93 Granted 3,866 $ 37.88 Exercised (218,826 ) $ 10.96 Canceled (8,404 ) $ 4.74 Outstanding at December 31, 2014 515,830 $ 13.98 Granted 15,585 $ 41.19 Exercised (263,626 ) $ 13.86 Canceled (5,712 ) $ 21.94 Outstanding at December 31, 2015 262,077 $ 13.13 Granted — $ — Exercised (124,352 ) $ 11.09 Canceled — $ — Outstanding at December 31, 2016 137,725 $ 19.57 5.6 $ 6,174,886 Vested at December 31, 2016 127,469 $ 17.83 5.4 $ 5,936,639 Exercisable at December 31, 2016 127,469 $ 17.83 5.4 $ 5,936,639 |
Stock Option Activity | Stock option activity under the Plan and all predecessor stock incentive plans is as follows: Options Weighted-Average Outstanding at December 31, 2013 42,288 $ 20.05 Granted — $ — Exercised (27,942 ) $ 35.73 Canceled (1,188 ) $ 17.92 Outstanding at December 31, 2014 13,158 $ 23.36 Granted — $ — Exercised (13,158 ) $ 50.37 Canceled — $ — Outstanding at December 31, 2015 — $ — |
Time-Based Restricted Stock [Member] | |
Restricted Stock Activity | Time-based restricted stock activity under the Plan and all predecessor stock incentive plans is as follows: Time-based Weighted-Average Nonvested at December 31, 2013 382,974 $ 13.78 Granted 66,511 $ 32.70 Vested (116,641 ) $ 33.73 Forfeited (3,282 ) $ 16.61 Nonvested at December 31, 2014 329,562 $ 18.89 Granted 57,598 $ 43.81 Vested (230,704 ) $ 42.37 Forfeited (48,549 ) $ 20.20 Nonvested at December 31, 2015 107,907 $ 29.43 Granted 57,874 $ 37.64 Vested (43,848 ) $ 42.34 Forfeited (133 ) $ 43.89 Nonvested at December 31, 2016 121,800 $ 31.59 |
Performance-Based Restricted Stock [Member] | |
Restricted Stock Activity | Performance-based restricted stock activity under the Plan is as follows: Performance-based Performance-based Weighted-Average Nonvested at December 31, 2014 42,676 $ 33.72 Granted 34,638 $ 43.89 Vested (35,679 ) $ 41.91 Forfeited (12,538 ) $ 38.12 Nonvested at December 31, 2015 29,097 $ 39.38 Granted 44,925 $ 35.83 Vested (14,949 ) $ 35.71 Forfeited (657 ) $ 33.72 Nonvested at December 31, 2016 58,416 $ 36.63 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Leases [Abstract] | |
Minimum Annual Payments Under Non-Cancelable Leases | Minimum annual payments under these non-cancelable leases as of December 31, 2016 were as follows (in thousands): Year Ending December 31, 2017 $ 9,606 2018 9,271 2019 8,205 2020 6,477 2021 6,170 Thereafter 18,659 Total minimum lease payments $ 58,388 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Tax Provision (Benefit) | Income tax provision (benefit) for the years ended December 31, 2016, 2015 and 2014 consists of the following (in thousands): Year Ended December 31, 2016 2015 2014 Current income tax provision: Federal $ 26,752 $ 25,105 $ 18,722 State 2,798 2,560 3,131 29,550 27,665 21,853 Deferred income tax provision: Federal 5,217 987 3,118 State 216 37 456 5,433 1,024 3,574 Total income tax provision $ 34,983 $ 28,689 $ 25,427 |
Reconciliation of Differences between Income Tax Provision and Income Tax Determined by Applying US Federal Statutory Rate | The income tax provision differs from the amount of income tax determined by applying the U.S. Federal statutory rate to income before taxes as a result of the following (in thousands): Year Ended December 31, 2016 2015 2014 U.S. Federal statutory taxes $ 35,990 $ 26,876 $ 23,432 State and local taxes, net of U.S. Federal benefit 3,747 2,806 2,856 Permanent items 396 1,308 249 Excess tax benefits from vesting or settlement of stock compensation awards (1,749 ) — — Domestic production activities deduction (2,740 ) (2,262 ) (1,117 ) Federal credits (488 ) (328 ) (214 ) Other (173 ) 289 221 Total income tax provision $ 34,983 $ 28,689 $ 25,427 |
Schedule of Deferred Tax Assets and Liabilities | Deferred tax assets and liabilities as of December 31, 2016 and 2015 consist of the following (in thousands): As of December 31, 2016 2015 Deferred tax assets: Net operating losses $ 93 $ 138 Warranty reserve 14,510 12,904 Stock-based compensation 2,186 1,554 Accruals not currently deductible and other 2,261 6,195 Inventories 5,785 4,406 State tax credit carryforwards 4,020 4,350 Gross deferred tax assets, before valuation allowance 28,855 29,547 Valuation allowance (4,061 ) (4,582 ) Gross deferred tax assets, after valuation allowance 24,794 24,965 Deferred tax liabilities: Depreciation and other (25,688 ) (20,426 ) Gross deferred tax liabilities (25,688 ) (20,426 ) Net deferred tax (liability) asset $ (894 ) $ 4,539 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Summary of Liability Related to Lease | The following table provides information about the Company’s liability under the lease (in thousands): 2016 2015 Beginning balance, January 1 $ 2,106 $ 3,033 Net rental payments (691 ) (1,352 ) Accretion of discount 145 220 (Decrease) increase in net estimated contract termination costs (85 ) 205 Ending balance, December 31 $ 1,475 $ 2,106 |
Summary of Reconciliation of Company's Warranty Reserve that Represents Amounts Accrued for Surface Flaking Claims | The following is a reconciliation of the Company’s warranty reserve that represents amounts accrued for surface flaking claims (in thousands): 2016 2015 Beginning balance, January 1 $ 29,673 $ 31,419 Changes in estimates related to pre-existing warranties 9,835 5,426 Settlements made during the period (5,661 ) (7,172 ) Ending balance, December 31 $ 33,847 $ 29,673 |
Interim Financial Data (Unaud33
Interim Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Summary of Interim Financial Data | Three Months Ended December 31, September 30, June 30, March 31, December 31, September 30, June 30, March 31, (In thousands, except share and per share data) Net sales 95,322 106,168 146,450 131,676 89,202 94,023 136,779 120,800 Gross profit 38,113 29,945 61,410 57,627 31,955 22,143 52,524 48,247 Net income 12,629 7,787 23,725 23,706 8,086 3,744 18,715 17,553 Basic net income per share $ 0.43 $ 0.27 $ 0.81 $ 0.80 $ 0.26 $ 0.12 $ 0.59 $ 0.55 Basic weighted average common shares outstanding 29,318,915 29,295,284 29,264,362 29,697,722 30,766,943 31,227,643 31,735,333 31,683,672 Diluted net income per share $ 0.43 $ 0.26 $ 0.80 $ 0.79 $ 0.26 $ 0.12 $ 0.58 $ 0.55 Diluted weighted average common shares outstanding 29,543,842 29,516,718 29,477,870 29,910,292 30,966,682 31,537,010 32,142,939 32,094,828 |
Schedule of Effect on Previously Reported Quarterly Data | The effect on previously reported data for the quarterly periods ended September 30, June 30, and March 31, 2016 is presented in the below table. Also, see the related discussion in Note 2, “ Summary of Significant Accounting Policies: Recently Adopted Accounting Standards, Three Months Ended September 30, 2016 June 30, 2016 March 31, 2016 As Reported Adjusted As Reported Adjusted As Reported Adjusted (In thousands, except share and per share data) Net income $ 6,898 $ 7,787 $ 23,279 $ 23,725 $ 23,402 $ 23,706 Basic net income per share $ 0.24 $ 0.27 $ 0.80 $ 0.81 $ 0.79 $ 0.80 Diluted net income per share $ 0.23 $ 0.26 $ 0.79 $ 0.80 $ 0.78 $ 0.79 Diluted weighted average common shares outstanding 29,457,653 29,516,718 29,423,845 29,477,870 29,860,730 29,910,292 |
Business and Organization - Add
Business and Organization - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2016Segment | |
Accounting Policies [Abstract] | |
Number of reportable segments | 1 |
Summary of Significant Accoun35
Summary of Significant Accounting Policies - Additional Information (Detail) | 12 Months Ended | |||
Dec. 31, 2016USD ($)ft²CustomerInstitutionSupplier | Dec. 31, 2015USD ($)Customer | Dec. 31, 2014USD ($)Customer | Dec. 31, 2010USD ($) | |
Schedule Of Significant Accounting Policies [Line Items] | ||||
Charge to earning to fully reserve the equity investment and note | $ 2,400,000 | |||
Maximum term of original maturities to classify as cash equivalent | 3 months | |||
Number of financial institutions where deposits are maintained | Institution | 1 | |||
Valuation allowance | $ 0 | $ 0 | ||
Number of customers that accounted for 10% or more of net sales | Customer | 2 | 1 | 1 | |
Number of customer accounted for 10% or more account receivable | Customer | 4 | |||
Number of largest raw material suppliers | Supplier | 4 | |||
Excess of the replacement cost of inventory over the LIFO value of inventory | $ 21,371,000 | $ 23,241,000 | ||
Annual impairment test of goodwill | 0 | 0 | $ 0 | |
Goodwill | 10,500,000 | |||
Valuation allowance | 4,061,000 | 4,582,000 | ||
Research and Development costs | 3,700,000 | 1,500,000 | 2,300,000 | |
Prepaid expenses for production costs of advertising | 2,400,000 | 800,000 | ||
Branding Expenses | 24,800,000 | 23,400,000 | 20,800,000 | |
Income tax expense (benefit) | 34,983,000 | $ 28,689,000 | $ 25,427,000 | |
Accounting Standards Update 2016-09 [Member] | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Income tax expense (benefit) | $ (1,700,000) | |||
Contract Termination [Member] | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Lease square feet | ft² | 55,047 | |||
Contract Termination [Member] | Dulles, Virginia [Member] | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Expiration date of reconsidered corporate headquarters lease | Jun. 30, 2019 | |||
Lease square feet | ft² | 55,047 | |||
Residential Use [Member] | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Warranty period | 25 years | |||
Commercial Use [Member] | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Warranty period | 10 years | |||
Trex Signature Railing [Member] | Residential Use [Member] | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Warranty period | 25 years | |||
Trex Signature Railing [Member] | Commercial Use [Member] | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Warranty period | 25 years | |||
Transcend, Enhance, Select and Universal Fascia Product [Member] | Residential Use [Member] | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Warranty period | 25 years | |||
Transcend, Enhance, Select and Universal Fascia Product [Member] | Commercial Use [Member] | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Warranty period | 10 years | |||
Sales Revenue, Net [Member] | Customer Concentration Risk [Member] | Minimum [Member] | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Concentration risk as percentage of total | 10.00% | 10.00% | 10.00% | |
Sales Revenue, Net [Member] | Customer Concentration Risk [Member] | Customer One [Member] | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Concentration risk as percentage of total | 39.00% | 27.00% | 24.00% | |
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer One [Member] | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Concentration risk as percentage of total | 30.00% | |||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer Two [Member] | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Concentration risk as percentage of total | 16.00% | |||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer Three [Member] | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Concentration risk as percentage of total | 14.00% | |||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer Four [Member] | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Concentration risk as percentage of total | 13.00% | |||
Raw Materials [Member] | Supplier Concentration Risk [Member] | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Concentration risk as percentage of total | 33.00% | 35.00% | 38.00% | |
Denplax [Member] | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Holding company's interest in Denplax | 35.00% |
Summary of Significant Accoun36
Summary of Significant Accounting Policies - Estimated Useful Lives of Property Plant and Equipment (Detail) | 12 Months Ended |
Dec. 31, 2016 | |
Buildings [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, plant, and equipment estimated useful life | 40 years |
Furniture and Fixtures [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, plant, and equipment estimated useful life | 10 years |
Forklifts and Tractors [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, plant, and equipment estimated useful life | 5 years |
Computer Equipment and Software [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, plant, and equipment estimated useful life | 5 years |
Minimum [Member] | Machinery and Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, plant, and equipment estimated useful life | 3 years |
Maximum [Member] | Machinery and Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, plant, and equipment estimated useful life | 11 years |
Inventories - Summary of Invent
Inventories - Summary of Inventories, at LIFO Value (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 29,686 | $ 24,961 |
Raw materials | 20,231 | 21,384 |
Total FIFO (first-in, first out) inventories | 49,917 | 46,345 |
Reserve to adjust inventories to LIFO value | (21,371) | (23,241) |
Total LIFO inventories | $ 28,546 | $ 23,104 |
Inventories - Additional Inform
Inventories - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Inventory Disclosure [Abstract] | |
Benefit recognized, to cost of sales, under the LIFO method due to reduction in inventory | $ 0 |
Prepaid Expenses and Other As39
Prepaid Expenses and Other Assets - Summary of Prepaid Expenses and Other Assets (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Prepaid Expense and Other Assets [Abstract] | ||
Prepaid expenses | $ 6,209 | $ 1,897 |
Income tax receivable | 4,024 | 5,134 |
Assets held for sale | 6,154 | |
Other | 167 | 224 |
Total prepaid expenses and other assets | $ 10,400 | $ 13,409 |
Property, Plant and Equipment -
Property, Plant and Equipment - Summary of Property, Plant and Equipment (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 310,256 | $ 297,056 |
Accumulated depreciation | (206,970) | (196,132) |
Total property, plant and equipment, net | 103,286 | 100,924 |
Building and Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 47,859 | 47,209 |
Machinery and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 223,450 | 210,880 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 2,710 | 2,221 |
Forklifts and Tractors [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 10,167 | 7,607 |
Computer Equipment and Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 10,481 | 9,575 |
Construction in Process [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 4,172 | 11,032 |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 11,417 | $ 8,532 |
Property, Plant and Equipment41
Property, Plant and Equipment - Additional Information (Detail) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Jan. 31, 2016USD ($) | Dec. 31, 2016USD ($)a | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Property, Plant and Equipment [Line Items] | ||||
Property, Plant and Equipment, Gross | $ 310,256 | $ 297,056 | ||
Depreciation expense | 14,200 | 14,300 | $ 14,800 | |
Proceeds from sales of property, plant and equipment | 4,349 | 35 | 66 | |
Gain (loss) on disposal of property, plant and equipment | $ 185 | (649) | $ (158) | |
Olive Branch Assets [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Loss on asset reclassification | 500 | |||
Proceeds from sales of property, plant and equipment | $ 4,200 | |||
Gain (loss) on disposal of property, plant and equipment | $ 100 | |||
Area of land owned | a | 62 | |||
Construction in Process [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Property, Plant and Equipment, Gross | $ 4,172 | $ 11,032 |
Accrued Expenses - Summary of A
Accrued Expenses - Summary of Accrued Expenses (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Payables and Accruals [Abstract] | ||
Sales and marketing costs | $ 16,707 | $ 11,928 |
Compensation and benefits | 13,298 | 11,217 |
Manufacturing costs | 1,799 | 1,732 |
Rent obligations | 632 | 664 |
Other | 2,257 | 3,350 |
Total accrued expenses | $ 34,693 | $ 28,891 |
Debt - Additional Information (
Debt - Additional Information (Detail) | Jan. 12, 2016 | Dec. 31, 2016USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Nov. 20, 2014USD ($) | Jan. 06, 2012USD ($) |
Line of Credit Facility [Line Items] | ||||||
Remaining available borrowing capacity | $ 200,000,000 | $ 200,000,000 | ||||
Company indebtedness | 0 | $ 0 | $ 7,000,000 | |||
Third Amended and Restated Credit Agreement [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Termination date of the Credit Agreement | Jan. 12, 2021 | |||||
Third Amended and Restated Credit Agreement [Member] | Federal Funds Rate [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Interest rate | 0.50% | |||||
Third Amended and Restated Credit Agreement [Member] | Eurodollar Rate Loans [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Interest rate | 1.00% | |||||
Second Amended and Restated Credit Agreement [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Termination date of the Credit Agreement | Nov. 20, 2019 | |||||
Credit facility covenant terms | The material financial covenants and restrictions do not permit the Company's fixed charge coverage ratio to be less than 1.5 to 1.0 and do not permit the Company's consolidated debt to consolidated EBITDA ratio to exceed 3.0 to 1.0, measured as of the end of each fiscal quarter (and in the case of Consolidated EBITDA, for the four-quarter period ending on such date). | |||||
Revolver Loans [Member] | As Reported [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Revolving loans in a collective maximum principal amount | $ 100,000,000 | |||||
Revolver Loans Portion Effective January 1 through June 30 [Member] | Third Amended and Restated Credit Agreement [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Revolving loans in a collective maximum principal amount | 250,000,000 | $ 250,000,000 | ||||
Revolver Loans Portion Effective January 1 through June 30 [Member] | Second Amended and Restated Credit Agreement [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Revolving loans in a collective maximum principal amount | 150,000,000 | 150,000,000 | ||||
Revolver Loans Portion Effective July 1 through December 31 [Member] | Third Amended and Restated Credit Agreement [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Revolving loans in a collective maximum principal amount | 200,000,000 | 200,000,000 | ||||
Revolver Loans Portion Effective July 1 through December 31 [Member] | Second Amended and Restated Credit Agreement [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Revolving loans in a collective maximum principal amount | $ 100,000,000 | 100,000,000 | ||||
Revolving Credit Facility [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Interest rate on the revolving credit facility | 1.39% | |||||
Revolving Credit Facility [Member] | Second Amended and Restated Credit Agreement [Member] | Minimum [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Fixed charge coverage ratio as per credit agreement | 1.5 | |||||
Revolving Credit Facility [Member] | Second Amended and Restated Credit Agreement [Member] | Maximum [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Consolidated debt to earnings before interest taxes depreciation amortization ratio as per the credit agreement | 3 | |||||
Revolving Credit Facility [Member] | Letter of Credit Facility Sublimit [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Revolving loans in a collective maximum principal amount | $ 15,000,000 | 15,000,000 | $ 15,000,000 | |||
Revolving Credit Facility [Member] | Swing Advance Loan Sublimit [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Revolving loans in a collective maximum principal amount | $ 5,000,000 | $ 5,000,000 | $ 5,000,000 |
Stockholders' Equity - Computat
Stockholders' Equity - Computation of Basic and Diluted Earnings Per Share (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Numerator: | |||||||||||
Net income | $ 12,629 | $ 7,787 | $ 23,725 | $ 23,706 | $ 8,086 | $ 3,744 | $ 18,715 | $ 17,553 | $ 67,847 | $ 48,098 | $ 41,521 |
Denominator: | |||||||||||
Basic weighted average shares outstanding | 29,318,915 | 29,295,284 | 29,264,362 | 29,697,722 | 30,766,943 | 31,227,643 | 31,735,333 | 31,683,672 | 29,394,559 | 31,350,542 | 32,319,649 |
Effect of dilutive securities: | |||||||||||
Diluted weighted average shares outstanding | 29,543,842 | 29,516,718 | 29,477,870 | 29,910,292 | 30,966,682 | 31,537,010 | 32,142,939 | 32,094,828 | 29,612,669 | 31,682,509 | 32,751,074 |
Basic earnings per share | $ 0.43 | $ 0.27 | $ 0.81 | $ 0.80 | $ 0.26 | $ 0.12 | $ 0.59 | $ 0.55 | $ 2.31 | $ 1.53 | $ 1.28 |
Diluted earnings per share | $ 0.43 | $ 0.26 | $ 0.80 | $ 0.79 | $ 0.26 | $ 0.12 | $ 0.58 | $ 0.55 | $ 2.29 | $ 1.52 | $ 1.27 |
Stock Appreciation Rights and Options [Member] | |||||||||||
Effect of dilutive securities: | |||||||||||
Dilutive securities | 125,119 | 197,299 | 262,730 | ||||||||
Restricted Stock [Member] | |||||||||||
Effect of dilutive securities: | |||||||||||
Dilutive securities | 92,991 | 134,668 | 168,695 |
Stockholders' Equity - Antidilu
Stockholders' Equity - Antidilutive Securities Excluded from Computation of Earnings Per Share (Detail) - shares | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
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 | 12 | 501 | 2,633 |
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 | 4,631 | 5,828 | 1,969 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Detail) - USD ($) | Feb. 16, 2017 | Oct. 22, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Oct. 23, 2014 | Feb. 19, 2014 |
Equity, Class of Treasury Stock [Line Items] | |||||||
Common stock repurchase program, termination date | Oct. 22, 2015 | ||||||
Subsequent Event [Member] | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Number of shares repurchased by the Company | 0 | ||||||
Common Stock [Member] | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Common stock repurchase program, authorized shares | 2,000,000 | ||||||
Common Stock [Member] | Subsequent Event [Member] | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Common stock repurchase program, authorized shares | 2,961,000 | ||||||
October 2014 Stock Repurchase Program [Member] | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Number of shares repurchased by the Company | 1,134,300 | ||||||
Value of shares repurchased by the Company | $ 45,200,000 | ||||||
October 2015 Stock Repurchase Program | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Number of shares repurchased by the Company | 1,578,952 | ||||||
Value of shares repurchased by the Company | $ 53,300,000 | ||||||
Common stock repurchase program, termination date | Dec. 31, 2016 | ||||||
October 2015 Stock Repurchase Program | Common Stock [Member] | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Common stock repurchase program, authorized shares | 3,150,000 | ||||||
February 2014 Stock Repurchase Program [Member] | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Common stock repurchase program, authorized amount | $ 50,000,000 | ||||||
Number of shares repurchased by the Company | 1,657,919 | ||||||
Value of shares repurchased by the Company | $ 50,000,000 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Detail) - USD ($) | Dec. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Approximate number of shares employees purchased under the Employee Stock Purchase Plan | 422,687 | |||
Stock Options Outstanding, Number | 0 | 0 | 0 | |
2014 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 | 6,420,000 | 6,420,000 | ||
Performance-Based Restricted Stock [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 3 years | |||
Unrecognized compensation cost related to unvested awards | $ 1,200,000 | $ 1,200,000 | $ 600,000 | |
Compensation cost recognition period for unvested awards | 2 years | |||
Number of shares or rights issued | 44,925 | 34,638 | ||
Performance-Based Restricted Stock [Member] | Share-Based Compensation Award, Tranche One [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based Compensation vesting percentage | 33.33% | |||
Performance-Based Restricted Stock [Member] | Share-Based Compensation Award, Tranche Two [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based Compensation vesting percentage | 33.33% | |||
Performance-Based Restricted Stock [Member] | Share-Based Compensation Award, Tranche Three [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based Compensation vesting percentage | 33.33% | |||
Stock Appreciation Rights [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Unrecognized compensation cost related to unvested awards | $ 0 | $ 0 | ||
Maximum contractual term | 10 years | |||
Fair value assumptions method used | Black-Scholes option-pricing model | |||
Number of shares or rights issued | 0 | |||
Weighted-average fair value of grants | $ 16.26 | $ 17.78 | ||
Time-Based Restricted Stock [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Unrecognized compensation cost related to unvested awards | $ 1,500,000 | $ 1,500,000 | ||
Compensation cost recognition period for unvested awards | 1 year 7 months 6 days | |||
Total fair value of restricted shares vested | $ 1,700,000 | $ 9,800,000 | $ 3,900,000 | |
Number of shares or rights issued | 57,874 | 57,598 | 66,511 | |
Employee Stock Purchase 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 | 600,000 | 600,000 | ||
Percentage of market price on lesser of either first day of calendar quarter or last day of calendar quarter for purchase price | 85.00% | |||
Percentage of gross compensation eligible employees may elect to participate in the plan | 15.00% | 15.00% | ||
Stock Options [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Maximum contractual term | 10 years | |||
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% | 200.00% |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Stock-Based Compensation Expense (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 4,788 | $ 4,861 | $ 4,807 |
Time Based Restricted Stock and Time Based Restricted Stock Units [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | 2,281 | 2,704 | 2,974 |
Performance Based Restricted Stock and Performance Based Restricted Stock Units [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | 2,210 | 1,562 | 727 |
Stock Appreciation Rights [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | 184 | 525 | 1,035 |
Employee Stock Purchase Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 113 | $ 70 | $ 71 |
Stock-Based Compensation - Time
Stock-Based Compensation - Time-Based Restricted Stock Activity (Detail) - Time-Based Restricted Stock [Member] - $ / shares | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Schedule Of Restricted Stock Activity [Line Items] | |||
Nonvested, Shares, Beginning Balance | 107,907 | 329,562 | 382,974 |
Time-based Restricted Stock, Granted | 57,874 | 57,598 | 66,511 |
Time-based Restricted Stock, Vested | (43,848) | (230,704) | (116,641) |
Time-based Restricted Stock, Forfeited | (133) | (48,549) | (3,282) |
Nonvested, Shares, Ending Balance | 121,800 | 107,907 | 329,562 |
Nonvested, Weighted-Average Grant Price Per Share, Beginning Balance | $ 29.43 | $ 18.89 | $ 13.78 |
Weighted-Average Grant Price Per Share, Granted | 37.64 | 43.81 | 32.70 |
Weighted-Average Grant Price Per Share, Vested | 42.34 | 42.37 | 33.73 |
Weighted-Average Grant Price Per Share, Forfeited | 43.89 | 20.20 | 16.61 |
Nonvested, Weighted-Average Grant Price Per Share, Ending Balance | $ 31.59 | $ 29.43 | $ 18.89 |
Stock-Based Compensation - Perf
Stock-Based Compensation - Performance-Based Restricted Stock Activity (Detail) - Performance-Based Restricted Stock [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Schedule Of Restricted Stock Activity [Line Items] | ||
Nonvested, Shares, Beginning Balance | 29,097 | 42,676 |
Performance-based Restricted Stock, Granted | 44,925 | 34,638 |
Performance-based Restricted Stock, Vested | (14,949) | (35,679) |
Performance-based Restricted Stock, Forfeited | (657) | (12,538) |
Nonvested, Shares, Ending Balance | 58,416 | 29,097 |
Nonvested, Weighted-Average Grant Price Per Share, Beginning Balance | $ 39.38 | $ 33.72 |
Weighted-Average Grant Price Per Share, Granted | 35.83 | 43.89 |
Weighted-Average Grant Price Per Share, Vested | 35.71 | 41.91 |
Weighted-Average Grant Price Per Share, Forfeited | 33.72 | 38.12 |
Nonvested, Weighted-Average Grant Price Per Share, Ending Balance | $ 36.63 | $ 39.38 |
Stock-Based Compensation - Su51
Stock-Based Compensation - Summary of Assumptions Used to Estimate Fair Value of Each SAR (Detail) - Stock Appreciation Rights [Member] | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Share Based Compensation Arrangement by Share Based Payment Award Fair Value Assumptions and Methodology [Line Items] | ||
Dividend yield | 0.00% | 0.00% |
Average risk-free interest rate | 1.60% | 1.70% |
Expected term (years) | 5 years | 5 years |
Expected volatility | 42.90% | 52.60% |
Stock-Based Compensation - SAR
Stock-Based Compensation - SAR Activity (Detail) - Stock Appreciation Rights [Member] - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Schedule Of Stock Appreciation Rights Activity [Line Items] | |||
SARs Outstanding, Beginning Balance | 262,077 | 515,830 | 739,194 |
Granted, SARs | 15,585 | 3,866 | |
Exercised, SARs | (124,352) | (263,626) | (218,826) |
Canceled, SARs | (5,712) | (8,404) | |
Shares Outstanding, SARs, Ending Balance | 137,725 | 262,077 | 515,830 |
Outstanding, Weighted Average Grant Price Per Share, Beginning Balance | $ 13.13 | $ 13.98 | $ 12.93 |
Vested, SARs | 127,469 | ||
Granted, Weighted Average Grant Price Per Share | 41.19 | 37.88 | |
Exercisable, SARs | 127,469 | ||
Exercised, Weighted Average Grant Price Per Share | $ 11.09 | 13.86 | 10.96 |
Canceled, Weighted Average Grant Price Per Share | 21.94 | 4.74 | |
Outstanding, Weighted Average Grant Price Per Share, Ending Balance | 19.57 | $ 13.13 | $ 13.98 |
Vested, Weighted Average Grant Price Per Share | 17.83 | ||
Exercisable, Weighted Average Grant Price Per Share | $ 17.83 | ||
Weighted Average Remaining Contractual Life, Outstanding | 5 years 7 months 6 days | ||
Weighted Average Remaining Contractual Life, Vested | 5 years 4 months 24 days | ||
Weighted Average Remaining Contractual Life, Exercisable | 5 years 4 months 24 days | ||
Aggregate Intrinsic Value, Outstanding | $ 6,174,886 | ||
Aggregate Intrinsic Value, Vested | 5,936,639 | ||
Aggregate Intrinsic Value, Exercisable | $ 5,936,639 |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock Option Activity (Detail) - $ / shares | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||
Outstanding Options, Beginning Balance | 13,158 | 42,288 |
Options Granted | 0 | 0 |
Options Exercised | (13,158) | (27,942) |
Options Canceled | (1,188) | |
Outstanding Options, Ending Balance | 13,158 | |
Weighted Average Exercise Price Per Share, Outstanding, Beginning Balance | $ 23.36 | $ 20.05 |
Weighted Average Exercise Price Per Share, Granted | 0 | 0 |
Weighted Average Exercise Price Per Share, Exercised | $ 50.37 | 35.73 |
Weighted Average Exercise Price Per Share, Canceled | 17.92 | |
Weighted Average Exercise Price Per Share, Outstanding, Ending Balance | $ 23.36 |
Leases - Minimum Annual Payment
Leases - Minimum Annual Payments Under Non-Cancelable Leases (Detail) $ in Thousands | Dec. 31, 2016USD ($) |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |
2,017 | $ 9,606 |
2,018 | 9,271 |
2,019 | 8,205 |
2,020 | 6,477 |
2,021 | 6,170 |
Thereafter | 18,659 |
Total minimum lease payments | $ 58,388 |
Leases - Additional Information
Leases - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Leases [Abstract] | |||
Recognized rental expenses | $ 9.9 | $ 7.7 | $ 7.5 |
Employee Benefit Plans - Additi
Employee Benefit Plans - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Compensation and Retirement Disclosure [Abstract] | |||
Percentage of employee's contribution to the plan up to 6% of base salary matched by the Company | 100.00% | ||
Employer's contribution percentage | 6.00% | ||
Employer's contribution | $ 2.5 | $ 2.2 | $ 2 |
Income Taxes - Income Tax Provi
Income Taxes - Income Tax Provision (Benefit) (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Current income tax provision: | |||
Federal | $ 26,752 | $ 25,105 | $ 18,722 |
State | 2,798 | 2,560 | 3,131 |
Total | 29,550 | 27,665 | 21,853 |
Deferred income tax provision: | |||
Federal | 5,217 | 987 | 3,118 |
State | 216 | 37 | 456 |
Total | 5,433 | 1,024 | 3,574 |
Total income tax provision | $ 34,983 | $ 28,689 | $ 25,427 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Differences between Income Tax Provision and Income Tax Determined by Applying US Federal Statutory Rate (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Effective Income Tax Rate Reconciliation, Amount [Abstract] | |||
U.S. Federal statutory taxes | $ 35,990 | $ 26,876 | $ 23,432 |
State and local taxes, net of U.S. Federal benefit | 3,747 | 2,806 | 2,856 |
Permanent items | 396 | 1,308 | 249 |
Excess tax benefits from vesting or settlement of stock compensation awards | (1,749) | ||
Domestic production activities deduction | (2,740) | (2,262) | (1,117) |
Federal credits | (488) | (328) | (214) |
Other | (173) | 289 | 221 |
Total income tax provision | $ 34,983 | $ 28,689 | $ 25,427 |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred tax assets: | ||
Net operating losses | $ 93 | $ 138 |
Warranty reserve | 14,510 | 12,904 |
Stock-based compensation | 2,186 | 1,554 |
Accruals not currently deductible and other | 2,261 | 6,195 |
Inventories | 5,785 | 4,406 |
State tax credit carryforwards | 4,020 | 4,350 |
Gross deferred tax assets, before valuation allowance | 28,855 | 29,547 |
Valuation allowance | (4,061) | (4,582) |
Gross deferred tax assets, after valuation allowance | 24,794 | 24,965 |
Deferred tax liabilities: | ||
Depreciation and other | (25,688) | (20,426) |
Gross deferred tax liabilities | (25,688) | (20,426) |
Net deferred tax liability | $ (894) | |
Net deferred tax asset | $ 4,539 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) | 12 Months Ended | ||
Dec. 31, 2016USD ($)Tax_Positions | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Income Tax Contingency [Line Items] | |||
Valuation allowance | $ 4,061,000 | $ 4,582,000 | |
Income tax expense (benefit) | $ 34,983,000 | $ 28,689,000 | $ 25,427,000 |
Unrecognized tax benefits number of tax matters | Tax_Positions | 0 | ||
Unrecognized tax benefits related to identified uncertain tax positions | $ 0 | ||
Accounting Standards Update 2016-09 [Member] | |||
Income Tax Contingency [Line Items] | |||
Income tax expense (benefit) | $ (1,700,000) | ||
Earliest Tax Year [Member] | Federal Tax Jurisdiction [Member] | |||
Income Tax Contingency [Line Items] | |||
Tax years subject to examination | 2,013 | ||
Latest Tax Year [Member] | Federal Tax Jurisdiction [Member] | |||
Income Tax Contingency [Line Items] | |||
Tax years subject to examination | 2,016 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($)ft² | Dec. 31, 2015USD ($) | |
Schedule Of Commitments And Contingencies [Line Items] | |||
Minimum payments, 2017 | $ 9,606 | ||
Minimum payments, 2018 | 9,271 | ||
Minimum payments, 2019 | 8,205 | ||
Change in warranty reserve for disclosure purposes only | $ 3,400 | ||
Minimum [Member] | |||
Schedule Of Commitments And Contingencies [Line Items] | |||
Average period for PE material purchases under short-term supply contracts for which pricing is negotiated as needed | 1 year | ||
Maximum [Member] | |||
Schedule Of Commitments And Contingencies [Line Items] | |||
Average period for PE material purchases under short-term supply contracts for which pricing is negotiated as needed | 2 years | ||
Surface Flaking Warranty Reserve [Member] | |||
Schedule Of Commitments And Contingencies [Line Items] | |||
Increase in warranty reserve | $ 9,800 | $ 9,835 | $ 5,426 |
Change in percentage of annual cash outflow for surface flaking claims declined | 21.00% | 19.00% | |
Change in annual cash outflow for surface flaking claims declined | $ 1,500 | $ 1,700 | |
Percentage change in warranty claims used as a threshold for disclosure | 10.00% | ||
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 | ||
Trex Signature Railing [Member] | Residential Use [Member] | |||
Schedule Of Commitments And Contingencies [Line Items] | |||
Warranty period | 25 years | ||
Trex Signature Railing [Member] | Commercial Use [Member] | |||
Schedule Of Commitments And Contingencies [Line Items] | |||
Warranty period | 25 years | ||
Sublease [Member] | |||
Schedule Of Commitments And Contingencies [Line Items] | |||
Net minimum receipts remaining under the Company's existing subleases for 2017 | $ 1,300 | ||
Net minimum receipts remaining under the Company's existing subleases for 2018 | 1,300 | ||
Net minimum receipts remaining under the Company's existing subleases for 2019 | $ 700 | ||
Contract Termination [Member] | |||
Schedule Of Commitments And Contingencies [Line Items] | |||
Lease square feet | ft² | 55,047 | ||
Minimum payments, 2017 | $ 1,900 | ||
Minimum payments, 2018 | 2,000 | ||
Minimum payments, 2019 | 1,000 | ||
Waste Wood And Pe Material Supply Contracts [Member] | |||
Schedule Of Commitments And Contingencies [Line Items] | |||
Purchase commitment | 20,200 | ||
Purchase commitment, due in second year | 3,200 | ||
Purchase commitment, due in third year | 350 | ||
Purchase commitment, due in fourth year | $ 50 |
Commitments and Contingencies62
Commitments and Contingencies - Summary of Liability Related to Lease (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Beginning balance | $ 2,106 | $ 3,033 |
Net rental payments | (691) | (1,352) |
Accretion of discount | 145 | 220 |
(Decrease) increase in net estimated contract termination costs | (85) | 205 |
Ending balance | $ 1,475 | $ 2,106 |
Commitments and Contingencies63
Commitments and Contingencies - Summary of Reconciliation of Company's Warranty Reserve that Represents Amounts Accrued for Surface Flaking Claims (Detail) - Surface Flaking Warranty Reserve [Member] - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Sep. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | |
Product Warranty Liability [Line Items] | |||
Beginning balance | $ 29,673 | $ 31,419 | |
Changes in estimates related to pre-existing warranties | $ 9,800 | 9,835 | 5,426 |
Settlements made during the period | (5,661) | (7,172) | |
Ending balance | $ 33,847 | $ 29,673 |
Interim Financial Data (Unaud64
Interim Financial Data (Unaudited) - Summary of Interim Financial Data (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Quarterly Financial Data [Abstract] | |||||||||||
Net sales | $ 95,322 | $ 106,168 | $ 146,450 | $ 131,676 | $ 89,202 | $ 94,023 | $ 136,779 | $ 120,800 | $ 479,616 | $ 440,804 | $ 391,660 |
Gross profit | 38,113 | 29,945 | 61,410 | 57,627 | 31,955 | 22,143 | 52,524 | 48,247 | 187,095 | 154,869 | 140,196 |
Net income | $ 12,629 | $ 7,787 | $ 23,725 | $ 23,706 | $ 8,086 | $ 3,744 | $ 18,715 | $ 17,553 | $ 67,847 | $ 48,098 | $ 41,521 |
Basic net income per share | $ 0.43 | $ 0.27 | $ 0.81 | $ 0.80 | $ 0.26 | $ 0.12 | $ 0.59 | $ 0.55 | $ 2.31 | $ 1.53 | $ 1.28 |
Basic weighted average common shares outstanding | 29,318,915 | 29,295,284 | 29,264,362 | 29,697,722 | 30,766,943 | 31,227,643 | 31,735,333 | 31,683,672 | 29,394,559 | 31,350,542 | 32,319,649 |
Diluted net income per share | $ 0.43 | $ 0.26 | $ 0.80 | $ 0.79 | $ 0.26 | $ 0.12 | $ 0.58 | $ 0.55 | $ 2.29 | $ 1.52 | $ 1.27 |
Diluted weighted average common shares outstanding | 29,543,842 | 29,516,718 | 29,477,870 | 29,910,292 | 30,966,682 | 31,537,010 | 32,142,939 | 32,094,828 | 29,612,669 | 31,682,509 | 32,751,074 |
Interim Financial Data (Unaud65
Interim Financial Data (Unaudited) - Schedule of Effect on Previously Reported Quarterly Data (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Interim Reporting [Line Items] | |||||||||||
Net income | $ 12,629 | $ 7,787 | $ 23,725 | $ 23,706 | $ 8,086 | $ 3,744 | $ 18,715 | $ 17,553 | $ 67,847 | $ 48,098 | $ 41,521 |
Basic net income per share | $ 0.43 | $ 0.27 | $ 0.81 | $ 0.80 | $ 0.26 | $ 0.12 | $ 0.59 | $ 0.55 | $ 2.31 | $ 1.53 | $ 1.28 |
Diluted net income per share | $ 0.43 | $ 0.26 | $ 0.80 | $ 0.79 | $ 0.26 | $ 0.12 | $ 0.58 | $ 0.55 | $ 2.29 | $ 1.52 | $ 1.27 |
Diluted weighted average common shares outstanding | 29,543,842 | 29,516,718 | 29,477,870 | 29,910,292 | 30,966,682 | 31,537,010 | 32,142,939 | 32,094,828 | 29,612,669 | 31,682,509 | 32,751,074 |
As Reported [Member] | |||||||||||
Interim Reporting [Line Items] | |||||||||||
Net income | $ 6,898 | $ 23,279 | $ 23,402 | ||||||||
Basic net income per share | $ 0.24 | $ 0.80 | $ 0.79 | ||||||||
Diluted net income per share | $ 0.23 | $ 0.79 | $ 0.78 | ||||||||
Diluted weighted average common shares outstanding | 29,457,653 | 29,423,845 | 29,860,730 |
Schedule II - Valuation and Q66
Schedule II - Valuation and Qualifying Accounts and Reserves (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Warranty Reserve [Member] | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance at Beginning of Period | $ 33,522 | $ 33,841 | $ 40,812 |
Additions (Reductions) Charged to Cost and Expenses | 10,852 | 8,515 | 3,774 |
Deductions | (6,682) | (8,834) | (10,745) |
Balance at End of Period | 37,692 | 33,522 | 33,841 |
Valuation Allowance of Deferred Tax Assets [Member] | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance at Beginning of Period | 4,582 | 4,465 | 4,201 |
Additions (Reductions) Charged to Cost and Expenses | 117 | 388 | |
Deductions | (521) | (124) | |
Balance at End of Period | $ 4,061 | $ 4,582 | $ 4,465 |