Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Jan. 31, 2020 | Mar. 03, 2020 | |
Class of Stock [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jan. 31, 2020 | |
Document Transition Report | false | |
Entity File Number | 1-33913 | |
Entity Registrant Name | QUANEX BUILDING PRODUCTS CORPORATION | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 26-1561397 | |
Entity Address, Address Line One | 1800 West Loop South | |
Entity Address, Address Line Two | Suite 1500 | |
Entity Address, City or Town | Houston | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 77027 | |
City Area Code | 713 | |
Local Phone Number | 961-4600 | |
Title of 12(b) Security | Common Stock, par value $0.01 per share | |
Trading Symbol | NX | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Shell Company | false | |
Entity Central Index Key | 0001423221 | |
Current Fiscal Year End Date | --10-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Entity Common Stock, Shares Outstanding | 32,947,975 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Jan. 31, 2020 | Oct. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Current operating lease liabilities | $ 6,532 | $ 0 |
Current assets: | ||
Cash and cash equivalents | 23,114 | 30,868 |
Accounts receivable, net of allowance for doubtful accounts of $549 and $393 | 64,036 | 82,946 |
Inventories, net | 78,117 | 67,159 |
Prepaid and other current assets | 7,931 | 9,353 |
Total current assets | 173,198 | 190,326 |
Property, plant and equipment, net of accumulated depreciation of $322,403 and $317,568 | 192,148 | 193,600 |
Operating lease right-of-use assets | 41,661 | 0 |
Goodwill | 146,590 | 145,563 |
Intangible assets, net | 104,338 | 107,297 |
Other assets | 9,265 | 8,324 |
Total assets | 667,200 | 645,110 |
Current liabilities: | ||
Accounts payable | 49,092 | 63,604 |
Accrued liabilities | 28,982 | 39,221 |
Income taxes payable | 5,265 | 6,183 |
Current maturities of long-term debt | 707 | 746 |
Total current liabilities | 90,578 | 109,754 |
Long-term debt | 166,711 | 156,414 |
Noncurrent operating lease liabilities | 35,505 | 0 |
Deferred pension and postretirement benefits | 11,251 | 13,322 |
Deferred income taxes | 19,741 | 19,363 |
Other liabilities | 13,481 | 16,070 |
Total liabilities | 337,267 | 314,923 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Preferred stock, no par value, shares authorized 1,000,000; issued and outstanding - none | 0 | 0 |
Common stock, $0.01 par value, shares authorized 125,000,000; issued 37,319,866 and 37,370,402, respectively; outstanding 32,963,475 and 33,021,789, respectively | 373 | 374 |
Additional paid-in-capital | 252,495 | 254,673 |
Retained earnings | 182,989 | 185,703 |
Accumulated other comprehensive loss | (29,164) | (33,817) |
Less: Treasury stock at cost, 4,356,391 and 4,348,613 shares, respectively | (76,760) | (76,746) |
Total stockholders’ equity | 329,933 | 330,187 |
Total liabilities and stockholders' equity | $ 667,200 | $ 645,110 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Jan. 31, 2020 | Oct. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 549 | $ 393 |
Accumulated depreciation of property, plant and equipment | $ 322,403 | $ 317,568 |
Preferred stock, no par value | $ 0 | $ 0 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 125,000,000 | 125,000,000 |
Common stock, shares issued | 37,319,866 | 37,370,402 |
Common stock, shares outstanding | 32,963,475 | 33,021,789 |
Treasury stock, shares | 4,356,391 | 4,348,613 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income (Loss) (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Jan. 31, 2020 | Jan. 31, 2019 | |
Income Statement [Abstract] | ||
Net sales | $ 196,597 | $ 196,808 |
Cost and expenses: | ||
Cost of sales (excluding depreciation and amortization) | 157,427 | 158,557 |
Selling, general and administrative | 24,132 | 28,026 |
Restructuring charges | 153 | 103 |
Depreciation and amortization | 12,905 | 12,572 |
Operating income (loss) | 1,980 | (2,450) |
Non-operating (expense) income: | ||
Interest expense | (1,582) | (2,442) |
Other, net | 36 | 256 |
Income (loss) before income taxes | 434 | (4,636) |
Income tax (expense) benefit | (424) | 987 |
Net Income (Loss) | $ 10 | $ (3,649) |
Basic income (loss) per common share | $ 0 | $ (0.11) |
Diluted income (loss) per common share | $ 0 | $ (0.11) |
Weighted-average common shares outstanding: | ||
Basic (in shares) | 32,861 | 33,098 |
Diluted (in shares) | 33,078 | 33,098 |
Cash dividends per share (in usd per share) | $ 0.08 | $ 0.08 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Jan. 31, 2020 | Jan. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | ||
Net Income (Loss) | $ 10 | $ (3,649) |
Other comprehensive income: | ||
Foreign currency translation gain | 2,743 | 4,066 |
Change in pension from net unamortized loss adjustment (pretax) | 2,519 | (11) |
Change in pension from net unamortized gain tax (expense) | (609) | 7 |
Other comprehensive gain | 4,653 | 4,062 |
Comprehensive income | $ 4,663 | $ 413 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flow (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Jan. 31, 2020 | Jan. 31, 2019 | |
Operating activities: | ||
Net income (loss) | $ 10 | $ (3,649) |
Adjustments to reconcile net income (loss) to cash used for operating activities: | ||
Depreciation and amortization | 12,905 | 12,572 |
Stock-based compensation | (239) | 224 |
Deferred income tax | (413) | (1,877) |
Other, net | 1,096 | 785 |
Changes in assets and liabilities: | ||
Decrease in accounts receivable | 18,641 | 12,679 |
Increase in inventory | (10,657) | (11,601) |
Decrease in other current assets | 1,200 | 15 |
Decrease in accounts payable | (12,063) | (11,738) |
Decrease in accrued liabilities | (12,519) | (18,850) |
(Decrease) increase in income taxes payable | (936) | 422 |
Increase in deferred pension and postretirement benefits | 448 | 684 |
Decrease in other long-term liabilities | (405) | (27) |
Other, net | (725) | 118 |
Cash used for operating activities | (3,657) | (20,243) |
Investing activities: | ||
Capital expenditures | (9,312) | (6,271) |
Proceeds from disposition of capital assets | 0 | 74 |
Cash used for investing activities | (9,312) | (6,197) |
Financing activities: | ||
Borrowings under credit facility | 34,500 | 43,000 |
Repayments of credit facility borrowings | (24,500) | (23,000) |
Repayments of other long-term debt | (285) | (454) |
Common stock dividends paid | (2,659) | (2,675) |
Issuance of common stock | 3,075 | 27 |
Cash paid for payroll tax for shares forfeited upon vesting | 454 | 322 |
Purchase of treasury stock | (4,639) | (2,016) |
Cash provided by financing activities | 5,038 | 14,560 |
Effect of exchange rate changes on cash and cash equivalents | 177 | 333 |
Decrease in cash and cash equivalents | (7,754) | (11,547) |
Cash and cash equivalents at beginning of period | 30,868 | 29,003 |
Cash and cash equivalents at end of period | $ 23,114 | $ 17,456 |
Condensed Consolidated Statem_4
Condensed Consolidated Statement of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Treasury Stock |
Balance at beginning of period at Oct. 31, 2018 | $ 395,222 | $ 374 | $ 254,678 | $ 243,904 | $ (30,705) | $ (73,029) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (3,649) | (3,649) | ||||
Foreign currency translation adjustment | 4,066 | 4,066 | ||||
Common dividends ($0.08 per share) | (2,675) | (2,675) | ||||
Treasury Stock, Value, Acquired, Cost Method | (2,016) | (2,016) | ||||
Stock-based compensation activity: | ||||||
Expense related to stock-based compensation | 224 | 224 | ||||
Stock Issued During Period, Value, Stock Options Exercised | 27 | (35) | 62 | |||
Restricted stock awards granted | 0 | (1,649) | (496) | 2,145 | ||
Other | (326) | (322) | 4 | |||
Balance at end of period at Jan. 31, 2019 | 390,873 | 374 | 252,931 | 237,049 | (26,643) | (72,838) |
Balance at beginning of period at Oct. 31, 2019 | 330,187 | 374 | 254,673 | 185,703 | (33,817) | (76,746) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | 10 | 10 | ||||
Foreign currency translation adjustment | 2,743 | 2,743 | ||||
Common dividends ($0.08 per share) | (2,659) | (2,659) | ||||
Treasury Stock, Value, Acquired, Cost Method | (4,639) | (4,639) | ||||
Stock-based compensation activity: | ||||||
Expense related to stock-based compensation | (239) | (239) | ||||
Stock Issued During Period, Value, Stock Options Exercised | 3,075 | 92 | (159) | 3,142 | ||
Restricted stock awards granted | 0 | (1,082) | 94 | 988 | ||
Other | (455) | 1 | (454) | |||
Balance at end of period at Jan. 31, 2020 | 329,933 | $ 373 | 252,495 | $ 182,989 | (29,164) | (76,760) |
Stock-based compensation activity: | ||||||
Other Comprehensive Income (Loss), Defined Benefit Plan, Gain (Loss) Arising During Period, after Tax | $ 1,910 | $ 1,910 | ||||
Stock Issued During Period, Treasury Shares, Performance Shares Vested | $ (495) | $ 495 |
Condensed Consolidated Statem_5
Condensed Consolidated Statement of Stockholders' Equity (Parenthetical) - $ / shares | 3 Months Ended | |
Jan. 31, 2020 | Jan. 31, 2019 | |
Statement of Stockholders' Equity [Abstract] | ||
Common stock, dividends per share (in usd per share) | $ 0.08 | $ 0.08 |
Nature of Operations and Basis
Nature of Operations and Basis of Presentation | 3 Months Ended |
Jan. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Operations and Basis of Presentation | Nature of Operations and Basis of Presentation Quanex Building Products Corporation is a component supplier to original equipment manufacturers (OEMs) in the building products industry. These components can be categorized as window and door (fenestration) components and kitchen and bath cabinet components. Examples of fenestration components include: (1) energy-efficient flexible insulating glass spacers, (2) extruded vinyl profiles, (3) window and door screens, and (4) precision-formed metal and wood products. We also manufacture cabinet doors and other components for OEMs in the kitchen and bathroom cabinet industry. In addition, we provide certain other non-fenestration components and products, which include solar panel sealants, trim moldings, vinyl decking, fencing, water retention barriers, and conservatory roof components. We have organized our business into three reportable business segments. For additional discussion of our reportable business segments, see Note 13, "Segment Information." We use low-cost, short lead-time production processes and engineering expertise to provide our customers with specialized products for their specific window, door, and cabinet applications. We believe these capabilities provide us with unique competitive advantages. We serve a primary customer base in North America and the United Kingdom (U.K.), and also serve customers in international markets through our operating plants in the U.K. and Germany, as well as through sales and marketing efforts in other countries. Unless the context indicates otherwise, references to "Quanex", the "Company", "we", "us" and "our" refer to the consolidated business operations of Quanex Building Products Corporation and its subsidiaries. The accompanying interim condensed consolidated financial statements include the accounts of Quanex Building Products Corporation. All intercompany accounts and transactions have been eliminated in consolidation. These financial statements have been prepared by us, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) have been condensed or omitted pursuant to such rules and regulations. The condensed consolidated balance sheet as of October 31, 2019 was derived from audited financial information, but does not include all disclosures required by U.S. GAAP. The accompanying financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto, included in our Annual Report on Form 10-K for the fiscal year ended October 31, 2019 . In our opinion, the accompanying financial statements contain all adjustments (which consist of normal recurring adjustments, except as disclosed herein) necessary to fairly present our financial position, results of operations and cash flows for the interim periods. The results of operations for the periods presented are not necessarily indicative of the results to be expected for the full year or for any future periods. In preparing financial statements, we make informed judgments and estimates that affect the reported amounts of assets and liabilities as of the date of the financial statements and affect the reported amounts of revenues and expenses during the reporting period. We review our estimates on an on-going basis, including those related to impairment of long lived assets and goodwill, contingencies and income taxes. Changes in facts and circumstances may result in revised estimates and actual results may differ from these estimates. Revenue from Contracts with Customers Revenue recognition We recognize revenue that reflects only the consideration we expect to receive for product sales upon transfer to customers. Revenue for product sales is recognized when control of the promised products is actually transferred to our customers, and we expect to be entitled to consideration in exchange for such transfer. We account for a contract when a customer provides us with a firm purchase order that identifies the products to be provided, the payment terms for those services, and when collectability of the consideration due is probable. Performance obligations A performance obligation is a promise to provide the customer with a good or service. Our performance obligations include product sales, with each product included in a customer contract being recognized as a separate performance obligation. For contracts with multiple performance obligations, the standalone selling price of each product is generally readily observable. Revenue from product sales is recognized at a point in time when the product is transferred to the customer, in accordance with the shipping terms, which is generally upon shipment. We estimate a provision for sales returns and warranty allowances to account for product returns related to general returns and product nonconformance. Pricing and sales incentives Pricing is established at or prior to the time of sale with our customers and we record sales at the agreed-upon net selling price, reflective of current and prospective discounts. Practical expedients and exemptions We generally expense incremental costs of obtaining a contract when incurred because the amortization period would be less than one year. Additionally, we do not disclose the value of unsatisfied performance obligations for contracts with an original expected length of one year or less. Shipping and handling costs We account for shipping and handling services as fulfillment services; accordingly, freight revenue is combined with the product deliverable rather than being accounted for as a distinct performance obligation within the terms of the agreement. Shipping and handling costs incurred by us for the delivery of goods to customers are considered a cost to fulfill the contract and are included in Cost of sales in the accompanying Condensed Consolidated Statements of Income. Contract assets and liabilities Deferred revenue, which is not significant, is recorded when we have remaining unsatisfied performance obligations for which we have received consideration. Disaggregation of revenue We produce a wide variety of products that are used in the fenestration industry, including window spacer systems; extruded vinyl products; metal fabricated products; and astragals, thresholds and screens. In addition, we produce certain non-fenestration products, including kitchen and bath cabinet doors and components, flooring and trim moldings, solar edge tape, plastic decking, fencing, water retention barriers, conservatory roof components, and other products. The following table summarizes our product sales for the three months ended January 31, 2020 and 2019 into groupings by segment which we believe depicts how the nature, amount, timing and uncertainty of our revenues and cash flows are affected by economic factors. For further details regarding our results by segment, refer to Note 13, “Segment Information”. Three Months Ended January 31, 2020 2019 (In thousands) North American Fenestration: United States - fenestration $ 96,847 $ 93,884 International - fenestration 6,434 8,207 United States - non-fenestration 4,563 3,505 International - non-fenestration 2,608 3,453 $ 110,452 $ 109,049 European Fenestration: International - fenestration $ 30,964 $ 30,724 International - non-fenestration 5,802 4,530 $ 36,766 $ 35,254 North American Cabinet Components: United States - fenestration $ 3,147 $ 3,352 United States - non-fenestration 46,450 49,962 International - non-fenestration 447 539 $ 50,044 $ 53,853 Unallocated Corporate & Other Eliminations $ (665 ) $ (1,348 ) $ (665 ) $ (1,348 ) Net sales $ 196,597 $ 196,808 Restructuring We accrue one-time severance costs pursuant to an approved plan of restructuring at the communication date, when affected employees have been notified of the potential severance and sufficient information has been provided for the employee to calculate severance benefits, in the event the employee is involuntarily terminated. In addition, we accrue costs associated with the termination of contractual commitments including operating leases at the time the lease is terminated pursuant to the lease provisions or in accordance with another agreement with the landlord. Otherwise, we continue to recognize operating lease expense through the cease-use date. After the cease-use date, we determine if our operating lease payments are at market. We assume sublet of the facility at the market rate. To the extent our lease obligations exceed the fair value rentals, we discount to arrive at the present value and record a liability. If the facility is not sublet, we expense the amount of the rental in the current period. For other costs directly related to the restructuring effort, such as equipment moving costs, we expense in the period incurred. We closed a kitchen and bathroom cabinet door business in Mexico in October 2016 and another plant in Lansing, Kansas in September 2017. We closed two U.S. vinyl operations plants in November 2016 and January 2017. Pursuant to these restructuring efforts, we expensed $0.1 million during the three months ended January 31, 2020 and 2019. We have not negotiated an exit from our lease obligation, which is deemed to be at fair market value, at one remaining closed plant location. We expect to continue to incur costs related to this operating lease during fiscal 2020 until we are able to sublet or otherwise exit the lease. During the year ended October 31, 2019, our North American Cabinet Components segment experienced declines in current and forecasted demand as a result of an industry-wide shift from semi-custom cabinets to stock cabinets, and received notice about a change in strategy at one of our large customers that may result in lower sales volumes in the future. As a result, during the first quarter of fiscal 2020, we began to restructure our operations within that segment by announcing the closure of one of our plants. We incurred severance expense of less than $0.1 million related to this plant closure during the three months ended January 31, 2020 and we expect to incur costs related to additional restructuring activities in future periods. |
Leases
Leases | 3 Months Ended |
Jan. 31, 2020 | |
Leases [Abstract] | |
Leases | Leases Effective November 1, 2019, we adopted Accounting Standards Codification Topic 842, "Leases" (ASC Topic 842), which requires leases to be recognized on the balance sheet. We recognize a right-of-use (ROU) asset and lease liability for each operating and finance lease with a contractual term greater than 12 months at the time of lease inception. We include ROU assets and lease liabilities for leases that exist within other contracts. Leases with an original term of 12 months or less are not recognized on the balance sheet, and the rent expense related to those short-term leases is recognized over the lease term. We do not account for lease and non-lease (e.g. common area maintenance) components of contracts separately for any underlying asset class. We lease certain manufacturing plants, warehouses, office space, vehicles and equipment under finance and operating leases. Lease commencement occurs on the date we take possession or control of the property or equipment. Original terms for our real estate-related leases are generally between five and twenty years . Original terms for equipment-related leases, primarily manufacturing equipment and vehicles, are generally between one and ten years . Some of our leases also include rental escalation clauses. Renewal options are included in the determination of lease payments when management determines the options are reasonably certain of exercise, considering financial performance, strategic importance and/or invested capital. If readily determinable, the rate implicit in the lease is used to discount lease payments to present value; however, substantially all of our leases do not provide a readily determinable implicit rate. When the implicit rate is not determinable, our estimated incremental borrowing rate is utilized, determined on a collateralized basis, to discount lease payments based on information available at lease commencement. Total lease costs recorded include fixed operating lease costs and variable lease costs. Most of our real estate leases require we pay certain expenses, such as CAM costs, of which the fixed portion is included in operating lease costs. We recognize operating lease costs on a straight-line basis over the lease term. In addition to the above costs, variable lease costs are recognized when probable and are not included in determining the present value of our lease liability. The ROU asset is measured at the initial amount of the lease liability adjusted for lease payments made at or before the lease commencement date and initial direct costs. For operating leases, ROU assets are reduced over the lease term by the recognized straight-line lease expense less the amount of accretion of the lease liability determined using the effective interest method. For finance leases, ROU assets are amortized on a straight-line basis over the shorter of the useful life of the leased asset or the lease term. Interest expense on each finance lease liability is recognized utilizing the effective interest method. ROU assets are tested for impairment in the same manner as long-lived assets. Additionally, we monitor for events or changes in circumstances that may require a reassessment of one of our leases and determine if a remeasurement is required. The table below presents the lease-related assets and liabilities recorded on the balance sheet at January 31, 2020 (in thousands): Leases Classification January 31, 2020 Assets Operating lease assets Operating lease right-of-use assets $ 41,661 Finance lease assets Property, plant and equipment (less accumulated depreciation of $308) 16,317 Total lease assets $ 57,978 Liabilities Current Operating Current operating lease liabilities $ 6,532 Finance Current maturities of long-term debt 975 Noncurrent Operating Noncurrent operating lease liabilities 35,505 Finance Long-term debt 14,921 Total lease liabilities $ 57,933 The table below presents the components of the lease costs for the three months ended January 31, 2020 (in thousands): Three months ended January 31, 2020 Components of lease costs Operating lease cost $ 2,058 Finance lease cost Amortization of leased assets 316 Interest on lease liabilities 144 Variable lease costs 125 Total lease cost $ 2,643 The table below presents supplemental cash flow information related to leases for the three months ended January 31, 2020 (in thousands): Three months ended January 31, 2020 Supplemental Cash Flow Information Cash paid for amounts included in the measurement of lease liabilities: Finance leases - financing cash flows $ 322 Finance leases - operating cash flows $ 144 Operating leases - operating cash flows $ 2,071 Right-of-use assets obtained in exchange for lease liabilities Operating leases $ 3,082 Finance Leases $ — The table below presents the weighted average remaining lease terms and weighted average discount rates for the Company's leases as of January 31, 2020: January 31, 2020 Weighted average remaining lease term (in years) Operating leases 8.2 Financing leases 16.4 Weighted average discount rate Operating leases 4.08 % Financing leases 3.64 % The table below presents the maturity of the lease liabilities as of January 31, 2020 (in thousands): Operating Leases Finance Leases (in thousands) 2020 (remaining nine months) $ 6,141 $ 1,177 2021 7,195 1,425 2022 6,531 1,391 2023 6,220 1,294 2024 5,516 1,190 Thereafter 17,730 14,208 Total lease payments 49,333 20,685 Less: present value discount 7,296 4,789 Total lease liabilities $ 42,037 $ 15,896 As a result of the adoption of ASC Topic 842, we are required to present future minimum lease payments for operating and financing obligations having initial or remaining non-cancelable lease terms in excess of one year. These future minimum lease payments were previously disclosed in our 2019 Annual Report on Form 10-K and accounted for under previous lease guidance. Commitments as of October 31, 2019 were as follows: Operating Leases Capital Leases (in thousands) 2020 $ 9,121 $ 1,020 2021 6,981 810 2022 6,012 815 2023 5,506 973 2024 4,699 713 Thereafter 15,220 11,392 Total 47,539 15,723 Less: amount representing interest 5,064 Present value of minimum lease payments 10,659 |
Leases | Leases Effective November 1, 2019, we adopted Accounting Standards Codification Topic 842, "Leases" (ASC Topic 842), which requires leases to be recognized on the balance sheet. We recognize a right-of-use (ROU) asset and lease liability for each operating and finance lease with a contractual term greater than 12 months at the time of lease inception. We include ROU assets and lease liabilities for leases that exist within other contracts. Leases with an original term of 12 months or less are not recognized on the balance sheet, and the rent expense related to those short-term leases is recognized over the lease term. We do not account for lease and non-lease (e.g. common area maintenance) components of contracts separately for any underlying asset class. We lease certain manufacturing plants, warehouses, office space, vehicles and equipment under finance and operating leases. Lease commencement occurs on the date we take possession or control of the property or equipment. Original terms for our real estate-related leases are generally between five and twenty years . Original terms for equipment-related leases, primarily manufacturing equipment and vehicles, are generally between one and ten years . Some of our leases also include rental escalation clauses. Renewal options are included in the determination of lease payments when management determines the options are reasonably certain of exercise, considering financial performance, strategic importance and/or invested capital. If readily determinable, the rate implicit in the lease is used to discount lease payments to present value; however, substantially all of our leases do not provide a readily determinable implicit rate. When the implicit rate is not determinable, our estimated incremental borrowing rate is utilized, determined on a collateralized basis, to discount lease payments based on information available at lease commencement. Total lease costs recorded include fixed operating lease costs and variable lease costs. Most of our real estate leases require we pay certain expenses, such as CAM costs, of which the fixed portion is included in operating lease costs. We recognize operating lease costs on a straight-line basis over the lease term. In addition to the above costs, variable lease costs are recognized when probable and are not included in determining the present value of our lease liability. The ROU asset is measured at the initial amount of the lease liability adjusted for lease payments made at or before the lease commencement date and initial direct costs. For operating leases, ROU assets are reduced over the lease term by the recognized straight-line lease expense less the amount of accretion of the lease liability determined using the effective interest method. For finance leases, ROU assets are amortized on a straight-line basis over the shorter of the useful life of the leased asset or the lease term. Interest expense on each finance lease liability is recognized utilizing the effective interest method. ROU assets are tested for impairment in the same manner as long-lived assets. Additionally, we monitor for events or changes in circumstances that may require a reassessment of one of our leases and determine if a remeasurement is required. The table below presents the lease-related assets and liabilities recorded on the balance sheet at January 31, 2020 (in thousands): Leases Classification January 31, 2020 Assets Operating lease assets Operating lease right-of-use assets $ 41,661 Finance lease assets Property, plant and equipment (less accumulated depreciation of $308) 16,317 Total lease assets $ 57,978 Liabilities Current Operating Current operating lease liabilities $ 6,532 Finance Current maturities of long-term debt 975 Noncurrent Operating Noncurrent operating lease liabilities 35,505 Finance Long-term debt 14,921 Total lease liabilities $ 57,933 The table below presents the components of the lease costs for the three months ended January 31, 2020 (in thousands): Three months ended January 31, 2020 Components of lease costs Operating lease cost $ 2,058 Finance lease cost Amortization of leased assets 316 Interest on lease liabilities 144 Variable lease costs 125 Total lease cost $ 2,643 The table below presents supplemental cash flow information related to leases for the three months ended January 31, 2020 (in thousands): Three months ended January 31, 2020 Supplemental Cash Flow Information Cash paid for amounts included in the measurement of lease liabilities: Finance leases - financing cash flows $ 322 Finance leases - operating cash flows $ 144 Operating leases - operating cash flows $ 2,071 Right-of-use assets obtained in exchange for lease liabilities Operating leases $ 3,082 Finance Leases $ — The table below presents the weighted average remaining lease terms and weighted average discount rates for the Company's leases as of January 31, 2020: January 31, 2020 Weighted average remaining lease term (in years) Operating leases 8.2 Financing leases 16.4 Weighted average discount rate Operating leases 4.08 % Financing leases 3.64 % The table below presents the maturity of the lease liabilities as of January 31, 2020 (in thousands): Operating Leases Finance Leases (in thousands) 2020 (remaining nine months) $ 6,141 $ 1,177 2021 7,195 1,425 2022 6,531 1,391 2023 6,220 1,294 2024 5,516 1,190 Thereafter 17,730 14,208 Total lease payments 49,333 20,685 Less: present value discount 7,296 4,789 Total lease liabilities $ 42,037 $ 15,896 As a result of the adoption of ASC Topic 842, we are required to present future minimum lease payments for operating and financing obligations having initial or remaining non-cancelable lease terms in excess of one year. These future minimum lease payments were previously disclosed in our 2019 Annual Report on Form 10-K and accounted for under previous lease guidance. Commitments as of October 31, 2019 were as follows: Operating Leases Capital Leases (in thousands) 2020 $ 9,121 $ 1,020 2021 6,981 810 2022 6,012 815 2023 5,506 973 2024 4,699 713 Thereafter 15,220 11,392 Total 47,539 15,723 Less: amount representing interest 5,064 Present value of minimum lease payments 10,659 |
Inventories
Inventories | 3 Months Ended |
Jan. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consisted of the following at January 31, 2020 and October 31, 2019 : January 31, October 31, (In thousands) Raw materials $ 40,423 $ 32,818 Finished goods and work in process 39,461 35,538 Supplies and other 2,644 2,593 Total 82,528 70,949 Less: Inventory reserves 4,411 3,790 Inventories, net $ 78,117 $ 67,159 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 3 Months Ended |
Jan. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill The change in the carrying amount of goodwill for the three months ended January 31, 2020 was as follows: Three Months Ended January 31, 2020 (In thousands) Beginning balance as of November 1, 2019 $ 145,563 Foreign currency translation adjustment 1,027 Balance as of the end of the period $ 146,590 During the year ended October 31, 2019, we recorded impairment charges of $74.6 million associated with our NA Cabinet Components segment, which reduced the goodwill balance applicable to this reporting unit from $113.7 million to $39.1 million . Our other reporting units were not deemed to be impaired at our annual goodwill impairment testing date, August 31, 2019. As of January 31, 2020, there were no further indicators of impairment. Should our actual results for our NA Cabinet Components operating segment be lower than expected in the future, the corresponding goodwill could become impaired and the impairment could be material. For a summary of the change in the carrying amount of goodwill by segment, see Note 13, "Segment Information." Identifiable Intangible Assets Amortizable intangible assets consisted of the following as of January 31, 2020 and October 31, 2019 : January 31, 2020 October 31, 2019 Gross Carrying Amount Accumulated Amortization Gross Carrying Accumulated (In thousands) Customer relationships $ 154,727 $ 73,029 $ 153,950 $ 70,103 Trademarks and trade names 55,988 35,811 55,745 35,210 Patents and other technology 22,397 19,934 22,386 19,471 Total $ 233,112 $ 128,774 $ 232,081 $ 124,784 We had aggregate amortization expense related to intangible assets for the three months ended January 31, 2020 of $3.7 million and $4.0 million for the comparable prior year period. Estimated remaining amortization expense, based on current intangible balances, for each of the fiscal years ending October 31, is as follows (in thousands): Estimated Amortization Expense 2020 (remaining nine months) $ 10,594 2021 12,619 2022 11,998 2023 11,251 2024 10,520 Thereafter 47,356 Total $ 104,338 |
Debt and Capital Lease Obligati
Debt and Capital Lease Obligations | 3 Months Ended |
Jan. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt and Capital Lease Obligations | Debt and Capital Lease Obligations Debt consisted of the following at January 31, 2020 and October 31, 2019 : January 31, October 31, (In thousands) Revolving Credit Facility $ 152,500 $ 142,500 Finance lease obligations and other 16,047 15,865 Unamortized deferred financing fees (1,129 ) (1,205 ) Total debt $ 167,418 $ 157,160 Less: Current maturities of long-term debt 707 746 Long-term debt $ 166,711 $ 156,414 As more fully described in our Annual Report on Form 10-K for the year ended October 31, 2019, on October 18, 2018, we amended and extended our prior credit facility by entering into a $325.0 million revolving credit facility (the “Credit Facility”), with Wells Fargo Bank, National Association, as Agent, Swingline Lender and Issuing Lender, and Bank of America, N.A. serving as Syndication Agent. The Credit Facility has a five-year term, maturing on October 18, 2023, and requires interest payments calculated, at our election and depending upon our Consolidated Leverage Ratio, at either a Base Rate plus an applicable margin or the LIBOR Rate plus an applicable margin. The Credit Facility contains appropriate provisions to substitute LIBOR with a replacement rate if necessary. In addition, we are subject to commitment fees for the unused portion of the Credit Facility. The applicable margin and commitment fees are outlined in the following table: Pricing Level Consolidated Leverage Ratio Commitment Fee LIBOR Rate Loans Base Rate Loans I Less than or equal to 1.50 to 1.00 0.200% 1.25% 0.25% II Greater than 1.50 to 1.00, but less than or equal to 2.25 to 1.00 0.225% 1.50% 0.50% III Greater than 2.25 to 1.00, but less than or equal to 3.00 to 1.00 0.250% 1.75% 0.75% IV Greater than 3.00 to 1.00 0.300% 2.00% 1.00% In the event of default, outstanding borrowings would accrue interest at the Default Rate, as defined, whereby the obligations will bear interest at a per annum rate equal to 2% above the total per annum rate otherwise applicable. The Credit Facility contains a: (1) Consolidated Interest Coverage Ratio requirement whereby we must not permit the Consolidated Interest Coverage Ratio, as defined, to be less than 2.25 to 1.00, and (2) Consolidated Leverage Ratio requirement, whereby we must not permit the Consolidated Leverage Ratio, as defined, to be greater than 3.25 to 1.00. In addition to maintaining these financial covenants, the Credit Facility also limits our ability to enter into certain business transactions, such as to incur indebtedness or liens, to acquire businesses or dispose of material assets, make restricted payments, pay dividends (limited to $20.0 million per year) and other transactions as further defined in the Credit Facility. Substantially all of our domestic assets, with the exception of real property, are utilized as collateral for the Credit Facility. As of January 31, 2020 , we had $152.5 million of borrowings outstanding under the Credit Agreement (reduced by unamortized debt issuance costs of $1.1 million ), $4.8 million of outstanding letters of credit and $16.0 million outstanding primarily under finance leases and other debt. We had $167.7 million available for use under the Credit Agreement at January 31, 2020 . Outstanding borrowings under the Credit Agreement accrue interest at 3.15% per annum. Our weighted average borrowing rate for borrowings outstanding during the three months ended January 31, 2020 and 2019 was 3.27% and 4.03% , respectively. We were in compliance with our debt covenants as of January 31, 2020 . Other Debt Instruments |
Retirement Plans
Retirement Plans | 3 Months Ended |
Jan. 31, 2020 | |
Retirement Benefits [Abstract] | |
Retirement Plans | Retirement Plans Pension Plan Our non-contributory, single employer defined benefit pension plan covers a majority of our employees in the U.S. The net periodic pension cost for this plan for the three months ended January 31, 2020 and 2019 was as follows: Three Months Ended January 31, 2020 2019 (In thousands) Service cost $ 538 $ 977 Interest cost 293 283 Expected return on plan assets (491 ) (543 ) Amortization of net loss 108 16 Net periodic pension cost $ 448 $ 733 On January 1, 2020, we enacted changes to our pension plan whereby the benefits for all participants were frozen and thereafter those participants will receive increased benefits in the company sponsored defined contribution plan in lieu of participation in a defined benefit plan. As a result of this action, we have remeasured the pension assets and obligations for the pension plan as of December 31, 2019. This resulted in a decrease in our projected benefit obligation and recognition of a net actuarial gain of approximately $2.5 million that was recorded in accumulated other comprehensive income. The decrease in the projected benefit obligation was impacted by our asset performance through December 31, 2019, the impact of the pension plan freeze and an increase in the discount rate since October 31, 2019. The remeasurement described above is in addition to our annual year-end measurement of the funded status of our benefit plans that we will record as of October 31, 2020. As a result, the change in our pension benefit obligation and net actuarial loss will differ from the $2.5 million discussed above primarily as a result of any changes in interest rates and actual asset performance different from our expected return on assets during the year. During September 2019, we contributed $0.7 million to fund our plan, and we expect to make a contribution to our plan in September 2020 of approximately $3.7 million . Other Plans We also have a supplemental benefit plan covering certain executive officers and key employees and a non-qualified deferred compensation plan covering members of the Board of Directors and certain key employees. As of January 31, 2020 and October 31, 2019 , our liability under the supplemental benefit plan was approximately $4.3 million and $4.2 million , respectively. As of January 31, 2020 and October 31, 2019 , the liability associated with the deferred compensation plan was approximately $3.7 million and $3.8 million , respectively. We record the current portion of liabilities associated with these plans under the caption "Accrued Liabilities," and the long-term portion under the caption "Other Liabilities" in the accompanying condensed consolidated balance sheets. |
Warranty Obligations
Warranty Obligations | 3 Months Ended |
Jan. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Warranty Obligations | Warranty Obligations We accrue warranty obligations as we recognize revenue associated with certain products. We make provisions for our warranty obligations based upon historical experience of costs incurred for such obligations adjusted, as necessary, for current conditions and factors. There are significant uncertainties and judgments involved in estimating our warranty obligations, including changing product designs, differences in customer installation processes and future claims experience which may vary from historical claims experience. Therefore, the ultimate amount we incur as warranty costs in the near and long-term may not be consistent with our current estimate. A reconciliation of the activity related to our accrued warranty, including both the current and long-term portions (reported in accrued liabilities and other liabilities, respectively, on the accompanying condensed consolidated balance sheets) follows: Three Months Ended January 31, 2020 (In thousands) Beginning balance as of November 1, 2019 $ 260 Warranty costs paid (20 ) Total accrued warranty as of January 31, 2020 $ 240 Less: Current portion of accrued warranty 136 Long-term portion of accrued warranty $ 104 |
Income Taxes
Income Taxes | 3 Months Ended |
Jan. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes To determine our income tax expense or benefit for interim periods, consistent with accounting standards, we apply the estimated annual effective income tax rate to year-to-date results. Our estimated annual effective tax rates for the three months ended January 31, 2020 and 2019 was 20.5% and 24.0% , respectively, excluding discrete items. The 2020 effective rate was impacted by an additional discrete charge of $0.4 million related to the vesting or exercise of equity-based compensation awards. The 2019 effective rate was primarily impacted by a net charge of $1.4 million related to global intangible low-taxed income and foreign-derived intangible income, as well as discrete charges of $0.6 million for the adjustment of the one-time mandatory transition tax on deemed repatriation of previously tax-deferred and unremitted foreign earnings and $0.3 million related to the vesting or exercise of equity-based compensation awards. As of January 31, 2020 , our liability for uncertain tax positions (UTP) of $0.6 million relates to certain state tax items regarding the interpretation of tax laws and regulations. Judgment is required in assessing the future tax consequences of events that have been recognized in our financial statements or tax returns. The final outcome of the future tax consequences of legal proceedings, if any, as well as the outcome of competent authority proceedings, changes in regulatory tax laws, or interpretation of those tax laws could impact our financial statements. We are subject to the effect of these matters occurring in various jurisdictions. The disallowance of the UTP would not materially affect the annual effective tax rate. We do not believe any of the UTP at January 31, 2020 will be recognized within the next twelve months. We evaluate the likelihood of realization of our deferred tax assets by considering both positive and negative evidence. We maintain a valuation allowance for certain state net operating losses which totaled $1.6 million at January 31, 2020 and October 31, 2019. Final regulations were published by the Internal Revenue Service and U.S. Department of the Treasury regarding Uniform Capitalization (UNICAP) that became effective during fiscal 2020. We are evaluating the regulations but do not believe there will be a material impact on our consolidated financial statements. |
Contingencies
Contingencies | 3 Months Ended |
Jan. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | Contingencies Remediation and Environmental Compliance Costs Under applicable state and federal laws, we may be responsible for, among other things, all or part of the costs required to remove or remediate wastes or hazardous substances at locations we, or our predecessors, have owned or operated. From time to time, we also have been alleged to be liable for all or part of the costs incurred to clean up third-party sites where there might have been an alleged improper disposal of hazardous substances. At present, we are not involved in any such matters. From time to time, we incur routine expenses and capital expenditures associated with compliance with existing environmental regulations, including control of air emissions and water discharges, and plant decommissioning costs. We have not incurred any material expenses or capital expenditures related to environmental matters during the past three fiscal years, and do not expect to incur a material amount of such costs in fiscal 2020 . While we will continue to have future expenditures related to environmental matters, any such amounts are impossible to reasonably estimate at this time. Based upon our experience to date, we do not believe that our compliance with environmental requirements will have a material adverse effect on our operations, financial condition or cash flows. Litigation From time to time, we, along with our subsidiaries, are involved in various litigation matters arising in the ordinary course of our business, including those arising from or related to contractual matters, commercial disputes, intellectual property, personal injury, environmental matters, product performance or warranties, product liability, insurance coverage and personnel and employment disputes. We regularly review with legal counsel the status of all ongoing proceedings, and we maintain insurance against these risks to the extent deemed prudent by our management and to the extent such insurance is available. However, there is no assurance that we will prevail in these matters or that our insurers will accept full coverage of these matters, and we could, in the future, incur judgments, enter into settlements of claims, or revise our expectations regarding the outcome or insurability of matters we face, which could materially impact our results of operations. We have been and are currently party to multiple claims, some of which are in litigation, relating to alleged defects in a commercial sealant product that was manufactured and sold during the 2000's. While we believe that our product was not defective and that we would prevail in these commercial sealant product claims if taken to trial, the timing, ultimate resolution and potential impact of these claims is not currently determinable. Nevertheless, after taking into account all currently available information, including our defenses, the advice of our counsel, and the extent and currently-expected availability of our existing insurance coverage, we believe that the eventual outcome of these commercial sealant claims will not have a material adverse effect on our overall financial condition, results of operations or cash flows, and we have not recorded any accrual with regard to these claims. |
Fair Value Measurement of Asset
Fair Value Measurement of Assets and Liabilities | 3 Months Ended |
Jan. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurement of Assets and Liabilities | Fair Value Measurement of Assets and Liabilities Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity's own assumptions about market data developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to Level 1 and the lowest priority to Level 3. The three levels of the fair value hierarchy are described below: • Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. • Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability either directly or indirectly including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates) and inputs that are derived principally from or corroborated by observable market data by correlation or other means. • Level 3 - Inputs that are both significant to the fair value measurement and unobservable. As of January 31, 2020 and October 31, 2019 , foreign currency derivatives were being measured on a recurring basis. Less than $0.1 million of foreign currency derivatives were included in total assets as of January 31, 2020 and October 31, 2019 . All of our derivative contracts are valued using quoted market prices from brokers or exchanges and are classified within Level 2 of the fair value hierarchy. Carrying amounts reported on the balance sheet for cash, cash equivalents, accounts receivable and accounts payable approximate fair value due to the short-term maturity of these instruments. Our outstanding debt is variable rate debt that re-prices frequently, thereby limiting our exposure to significant change in interest rate risk. As a result, the fair value of our debt instrument approximates carrying value at January 31, 2020 , and October 31, 2019 (Level 2 measurement). The liability portion of our performance share awards are marked-to-market on a quarterly basis during a three-year vesting period based on market data (Level 2 measurement). For further information, refer to Note 11, "Stock-Based Compensation -Performance Share Awards." |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Jan. 31, 2020 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation We have established and maintain an Omnibus Incentive Plan (2008 Plan) that provides for the granting of restricted stock awards, stock options, restricted stock units, performance share awards, performance restricted stock units, and other stock-based and cash-based awards. The 2008 Plan is administered by the Compensation and Management Development Committee of the Board of Directors. The aggregate number of shares of common stock authorized for grant under the 2008 Plan is 7,650,000 as approved by shareholders. In February 2020, shareholders authorized an increase of 1,300,000 shares for grant under a new 2020 plan, which became effective at that time. Any officer, key employee and/or non-employee director is eligible for awards under the 2008 Plan. We grant restricted stock units to non-employee directors on the first business day of each fiscal year. As approved by the Compensation & Management Development Committee of our Board of Directors annually, we grant a mix of restricted stock awards, restricted stock units, performance shares and/or performance restricted stock units to officers, management and key employees. We also historically granted stock options to certain officers, directors and key employees. Occasionally, we may make additional grants to key employees at other times during the year. Restricted Stock Awards Restricted stock awards are granted to key employees and officers annually, and typically cliff vest over a three year period with service and continued employment as the only vesting criteria. The recipient of the restricted stock award is entitled to all of the rights of a shareholder, except that the award is nontransferable during the vesting period. The fair value of the restricted stock award is established on the grant date and then expensed over the vesting period resulting in an increase in additional paid-in-capital. Shares are generally issued from treasury stock at the time of grant. A summary of non-vested restricted stock awards activity during the three months ended January 31, 2020 is presented below: Restricted Stock Awards Weighted Average Non-vested at October 31, 2019 230,100 $ 17.02 Granted 56,000 $ 19.40 Forfeited (27,300 ) $ 17.31 Vested (55,000 ) $ 19.45 Non-vested at January 31, 2020 203,800 $ 16.98 The total weighted average grant-date fair value of restricted stock awards that vested during each of the three month periods ended January 31, 2020 and 2019 was $1.1 million and $1.3 million , respectively. As of January 31, 2020 , total unrecognized compensation cost related to unamortized restricted stock awards was $2.2 million . We expect to recognize this expense over the remaining weighted average vesting period of 2.2 years . Stock Options Historically, stock options have been awarded to key employees, officers and non-employee directors. Effective May 2015, the director compensation structure was revised to eliminate the annual grant of stock options to non-employee directors. During December 2017, the Compensation & Management Development Committee of the Board of Directors approved a change to the long-term incentive award program eliminating the grant of stock options and replacing this award with a grant of performance restricted stock units as further described below. As a result, stock options were not granted during the years ended October 31, 2018, 2019 or during the three months ended January 31, 2020 . Employee stock options typically vest ratably over a three -year period with service and continued employment as the vesting conditions. Our stock options may be exercised up to a maximum of ten years from the date of grant. The fair value of the stock options is determined on the grant date and expensed over the vesting period resulting in an increase in additional paid-in-capital. For employees who are nearing retirement-eligibility, we recognize stock option expense ratably over the shorter of the vesting period or the period from the grant-date to the retirement-eligibility date. We use a Black-Scholes pricing model to estimate the fair value of stock options. A description of the methodology for the valuation assumptions was disclosed in our Annual Report on Form 10-K for the fiscal year ended October 31, 2019 . The following table summarizes our stock option activity for the three months ended January 31, 2020 : Stock Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (000s) Outstanding at October 31, 2019 1,416,186 $ 18.71 Granted — $ — Exercised (178,033 ) $ 16.93 Forfeited/Expired (58,734 ) $ 20.61 Outstanding at January 31, 2020 1,179,419 $ 18.89 4.2 $ 395 Vested or expected to vest at January 31, 2020 1,179,419 $ 18.89 4.2 $ 395 Exercisable at January 31, 2020 1,179,419 $ 18.89 4.2 $ 395 Intrinsic value is the amount by which the market price of the common stock on the date of exercise exceeds the exercise price of the stock option. The total intrinsic value of stock options exercised during the three months ended January 31, 2020 and 2019 was $0.5 million and less than $0.1 million , respectively. The weighted-average grant date fair value of stock options that vested during the three months ended January 31, 2020 and 2019 was $0.4 million and $1.1 million , respectively. As of January 31, 2020 , all compensation cost related to stock options has been recognized. Restricted Stock Units Restricted stock units may be awarded to key employees and officers from time to time, and annually to non-employee directors. The non-employee director restricted stock units vest immediately but are payable only upon the director's cessation of service unless an election is made by the non-employee director to settle and pay the award on an earlier specified date. Restricted stock units awarded to employees and officers typically cliff vest after a three -year period with service and continued employment as the vesting conditions. Restricted stock units are not considered outstanding shares and do not have voting rights, although the holder does receive a cash payment equivalent to the dividend paid, on a one-for-one basis, on our outstanding common shares. Once the criteria is met, each restricted stock unit is payable to the holder in cash based on the market value of one share of our common stock. Accordingly, we record a liability for the restricted stock units on our balance sheet and recognize any changes in the market value during each reporting period as compensation expense. During the three months ended January 31, 2020 and 2019 , non-employee directors received 25,326 and 25,920 restricted stock units, respectively, at a grant date fair value of $19.02 per share and $15.31 per share, respectively, which vested immediately. As of January 31, 2020 , there were 26,390 non-vested restricted stock units, which were awarded in June 2019 and January 2020 to key employees at a weighted average grant date fair value of $17.01 . During the three months ended January 31, 2019 , we paid approximately $0.1 million to settle previously vested restricted stock units; there were no corresponding payments to settle vested restricted stock units during the three months ended January 31, 2020 . Performance Share Awards We have awarded annual grants of performance shares to key employees and officers. These awards cliff vest after a three -year period. Performance share awards issued prior to fiscal 2019 vest with service and performance measures (relative total shareholder return (R-TSR) and earnings per share (EPS) growth), as vesting conditions. The number of shares earned is variable depending on the metrics achieved, and the settlement method is 50% in cash and 50% in our common stock. Performance share awards issued during fiscal 2019 and 2020 vest with return on net assets (RONA) as the vesting condition and pay out 100% in cash. To account for these awards, we have bifurcated the portion subject to a market condition (R-TSR) and the portion subject to an internal performance measure (EPS or RONA). We have further bifurcated these awards based on the settlement method, as the portion expected to settle in stock (equity component) and the portion expected to settle in cash (liability component). To value the shares subject to the market condition, we utilized a Monte Carlo simulation model to arrive at a grant-date fair value. This amount will be expensed over the three-year term of the award with a credit to additional paid-in-capital. To value the shares subject to the EPS and RONA performance measures, we used the value of our common stock on the date of grant as the grant-date fair value per share. This amount is being expensed over the three -year term of the award, with a credit to additional paid-in-capital, and could fluctuate depending on the number of shares ultimately expected to vest based on our assessment of the probability that the performance conditions will be achieved. The portion of the awards expected to settle in cash is recorded as a liability and is being marked to market over the three -year term of the award, and can fluctuate depending on the number of shares ultimately expected to vest. Depending on the achievement of the performance conditions, 0% to 200% of the awarded performance shares may ultimately vest. The following table summarizes our performance share grants and the grant date fair value for the EPS, R-TSR and RONA performance metrics: Grant Date Fair Value Grant Date Shares Awarded EPS R-TSR RONA Shares Forfeited December 7, 2017 146,500 $ 20.70 $ 21.81 $ — 46,608 December 5, 2018 131,500 $ — $ — $ 13.63 33,500 December 5, 2019 55,900 $ — $ — $ 19.40 — On November 30, 2019, a total of 56,103 shares vested pursuant to the November 2016 grant, which were settled with 28,051 shares of common stock and a cash payment of $0.6 million . We recorded a decrease in compensation expense of $0.5 million for the three months ended January 31, 2020 related to the expected payout of our performance share awards that are outstanding as of January 31, 2020 . During the three months ended January 31, 2019 , we recorded a decrease in compensation expense of $0.3 million related to the expected payouts of performance share awards that were outstanding as of January 31, 2019 . Performance share awards are not considered outstanding shares and do not have voting rights, although dividends are accrued over the performance period and will be payable in cash based upon the number of performance shares ultimately earned. The performance shares are excluded from the diluted weighted-average shares used to calculate earnings per share until the performance criteria is probable to result in the issuance of contingent shares. As of January 31, 2020 , we have deemed 18,730 shares related to the December 2017 grants of performance shares as probable to vest. Performance Restricted Stock Units We awarded performance restricted stock units to key employees and officers beginning in December 2017. These awards cliff vest upon a three-year service period with the absolute total shareholder return of our common stock over this three-year term as the vesting criteria. The number of shares earned is variable depending on the metric achieved, and the settlement method is 100% in our common stock, with accrued dividends paid in cash at the time of vesting, assuming the shares had been outstanding throughout the performance period. To value the performance restricted stock units, we utilized a Monte Carlo simulation model to arrive at a grant-date fair value. This amount will be adjusted for forfeitures and expensed over the three-year term of the award with a credit to additional paid-in-capital. Depending on the achievement of the performance conditions, a minimum of 0% and a maximum of 150% of the awarded performance restricted stock units may vest. Specifically, the awards vest on a continuum with the following Absolute Total Shareholder Return (A-TSR) milestones: Vesting Level Vesting Criteria Percentage of Award Vested Level 1 A-TSR greater than or equal to 50% 150% Level 2 A-TSR less than 50% and greater than or equal to 20% 100% Level 3 A-TSR less than 20% and greater than or equal to -20% 50% Level 4 A-TSR less than -20% —% The following table summarizes our performance restricted stock unit grants and the grant date fair value for the A-TSR performance metric: Grant Date Shares Awarded Grand Date Fair Value Shares Forfeited December 7, 2017 78,200 $ 17.76 24,854 December 5, 2018 89,200 $ 13.63 25,500 December 5, 2019 35,000 $ 19.40 — During the three months ended January 31, 2020 , we recorded compensation expense of approximately $0.1 million and $0.2 million , respectively, for the comparable prior year period related to our performance share restricted units. Similar to performance shares, the performance restricted stock units are not considered outstanding shares, do not have voting rights, and are excluded from diluted weighted-average shares used to calculate earnings per share until the performance criteria is probable to result in the issuance of contingent shares. As of January 31, 2020 , we have deemed 28,449 shares related to the December 2017 grants of performance restricted stock units as probable to vest. Treasury Shares We record treasury stock purchases under the cost method whereby the entire cost of the acquired stock is recorded as treasury stock. Shares are generally issued from treasury stock at the time of grant of restricted stock awards, upon the exercise of stock options, and upon the vesting of performance shares and performance restricted stock units. On the subsequent issuance of treasury shares, we record proceeds in excess of cost as an increase in additional paid in capital. A deficiency of such proceeds relative to costs would be applied to reduce paid-in-capital associated with prior issuances to the extent available, with the remainder recorded as a charge to retained earnings. We recorded a charge to retained earnings of $0.1 million during the three months ended January 31, 2020 . The following table summarizes the treasury stock activity during the three months ended January 31, 2020 : Three Months Ended January 31, 2020 Beginning balance as of November 1, 2019 4,348,613 Restricted stock awards granted (56,000 ) Performance share awards vested (28,051 ) Stock options exercised (178,033 ) Treasury stock repurchases 269,862 Balance at January 31, 2020 4,356,391 |
Other Income (Expense)
Other Income (Expense) | 3 Months Ended |
Jan. 31, 2020 | |
Other Income and Expenses [Abstract] | |
Other Income (Expense) | Other Income Other income, included under the caption "Other, net" on the accompanying condensed consolidated statements of income (loss), consisted of the following for the three months ended January 31, 2020 and 2019 : Three Months Ended January 31, 2020 2019 (In thousands) Foreign currency transaction losses $ (49 ) $ (32 ) Foreign currency derivative (losses) gains (11 ) 11 Pension service benefit 90 244 Interest income 5 30 Other 1 3 Other, net $ 36 $ 256 |
Segment Information (Notes)
Segment Information (Notes) | 3 Months Ended |
Jan. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment Reporting Disclosure [Text Block] | Segment Information We present three reportable business segments in accordance with ASC Topic 280-10-50, "Segment Reporting" (ASC 280): (1) North American Fenestration segment (NA Fenestration), comprising three operating segments primarily focused on the fenestration market in North America including vinyl profiles, insulating glass spacers, screens & other fenestration components; (2) European Fenestration segment (EU Fenestration), comprising our U.K.-based vinyl extrusion business, manufacturing vinyl profiles & conservatories, and the European insulating glass business manufacturing insulating glass spacers; and (3) North American Cabinet Components segment (NA Cabinet Components), comprising our cabinet door and components operations. We maintain an Unallocated Corporate & Other grouping which includes corporate office charges, and inter-segment eliminations, less an allocation of a portion of the general and administrative costs associated with the corporate office which have been allocated to the reportable business segments, based upon relative share of revenue, in order to more accurately reflect each reportable business segment's administrative cost. Certain costs are not allocated to the reportable operating segments, but remain in Unallocated Corporate & Other, including transaction expenses, stock-based compensation, long-term incentive awards based on the performance of our common stock and other factors, certain severance and legal costs not deemed to be allocable to all segments, depreciation of corporate assets, interest expense, other, net, income taxes, inter-segment eliminations, and executive incentive compensation and medical expense fluctuations relative to planned costs as determined during the annual planning process. The accounting policies of our operating segments are the same as those used to prepare the accompanying condensed consolidated financial statements. Corporate general and administrative expense allocated during the three month period ended January 31, 2020 was $5.5 million and $4.8 million for the prior year comparable period. ASC 280 permits aggregation of operating segments based on factors including, but not limited to: (1) similar nature of products serving the building products industry, primarily the fenestration business; (2) similar production processes, although there are some differences in the amount of automation amongst operating plants; (3) similar types or classes of customers, namely the primary OEMs; (4) similar distribution methods for product delivery, although the extent of the use of third-party distributors will vary amongst the businesses; (5) similar regulatory environment; and (6) converging long-term economic similarities. Segment information for the three months ended January 31, 2020 and 2019 , and total assets as of January 31, 2020 and October 31, 2019 are summarized in the following table (in thousands): NA Fenestration EU Fenestration NA Cabinet Comp. Unallocated Corp. & Other Total Three Months Ended January 31, 2020 Net sales $ 110,452 $ 36,766 $ 50,044 $ (665 ) $ 196,597 Depreciation and amortization 6,979 2,408 3,402 116 12,905 Operating income (loss) 1,631 3,164 (2,115 ) (700 ) 1,980 Capital expenditures 6,928 1,219 1,075 90 9,312 Three Months Ended January 31, 2019 Net sales $ 109,049 $ 35,254 $ 53,853 $ (1,348 ) $ 196,808 Depreciation and amortization 6,873 2,236 3,339 124 12,572 Operating income (loss) 1,843 2,781 (2,267 ) (4,807 ) (2,450 ) Capital expenditures 3,436 1,708 1,127 — 6,271 As of January 31, 2020 Total assets $ 247,396 $ 219,133 $ 181,746 $ 18,925 $ 667,200 As of October 31, 2019 Total assets $ 226,243 $ 212,239 $ 181,416 $ 25,212 $ 645,110 The following table summarizes the change in the carrying amount of goodwill by reportable business segment for the three months ended January 31, 2020 (in thousands): NA Fenestration EU Fenestration NA Cabinet Comp. Unallocated Corp. & Other Total Balance as of October 31, 2019 $ 38,712 $ 67,704 $ 39,147 $ — $ 145,563 Foreign currency translation adjustment — 1,027 — — 1,027 Balance as of January 31, 2020 $ 38,712 $ 68,731 $ 39,147 $ — $ 146,590 For further details of Goodwill, see Note 4, "Goodwill & Intangible Assets", located herewith. We did not allocate non-operating loss or income tax benefit to the reportable segments. The following table reconciles operating income (loss) as reported above to net income (loss) for the three months ended January 31, 2020 and 2019 : Three Months Ended January 31, 2020 2019 (In thousands) Operating income (loss) $ 1,980 $ (2,450 ) Interest expense (1,582 ) (2,442 ) Other, net 36 256 Income tax (expense) benefit (424 ) 987 Net income (loss) $ 10 $ (3,649 ) |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Jan. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share We compute basic earnings (loss) per share by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted earnings per common and potential common shares include the weighted average of additional shares associated with the incremental effect of dilutive employee stock options, non-vested restricted stock as determined using the treasury stock method prescribed by U.S. GAAP and contingent shares associated with performance share awards, if dilutive. Basic and diluted earnings (loss) per share for the three months ended January 31, 2020 and 2019 were calculated as follows (in thousands, except per share data): Net Income (Loss) Weighted Average Shares Per Share Three Months Ended January 31, 2020 Basic earnings per common share $ 10 32,861 $ — Effect of dilutive securities: Stock options 77 Restricted stock awards 93 Performance shares 28 Performance restricted stock units 19 Diluted earnings per common share $ 10 33,078 $ — Three Months Ended January 31, 2019 Basic loss per common share $ (3,649 ) 33,098 $ (0.11 ) Diluted loss per common share (1) $ (3,649 ) 33,098 $ (0.11 ) (1) The computation of diluted earnings per share excludes outstanding stock options and other common stock equivalents when their inclusion would be anti-dilutive. This is always the case when an entity incurs a net loss. During the three months ended January 31, 2019, 6,775 shares of common stock equivalent and 96,507 shares of restricted stock were excluded from the computation of diluted earnings per share. In addition 15,735 potentially dilutive contingent shares related to performance share awards for the three months ended 2019 were excluded. We had common stock equivalents that were potentially dilutive in future earnings per share calculations of 772,756 for the three months ended January 31, 2020 and 1,694,464 for the comparable prior year period. We also had 56,000 restricted stock award equivalents that were potentially dilutive in future earnings per calculations for the three months ended January 31, 2020 and no corresponding equivalents for the corresponding prior year. Such dilution will be dependent on the excess of the market price of our stock over the exercise price and other components of the treasury stock method. |
New Accounting Guidance Adopted
New Accounting Guidance Adopted | 3 Months Ended |
Jan. 31, 2020 | |
Accounting Changes and Error Corrections [Abstract] | |
New Accounting Guidance Adopted | New Accounting Guidance Accounting Standards Recently Adopted Effective November 1, 2019, we adopted Accounting Standards Update (ASU) 2016-02, Leases (Topic 842), using the modified retrospective approach and did not have a cumulative-effect adjustment in retained earnings as a result of the adoption. Topic 842 significantly changes accounting for leases by requiring that lessees recognize a liability representing the obligation to make lease payments and a related right-of-use (ROU) asset for virtually all lease transactions. Upon adoption, we implemented policy elections and practical expedients which include the following: • package of practical expedients which allows us to avoid reassessing contracts that commenced prior to adoption that were properly evaluated under legacy lease accounting guidance; • excluding ROU assets and lease liabilities for leases with terms that are less than one year; • combining lease and non-lease components and accounting for them as a single lease (elected by asset class); • excluding land easements that existed or expired prior to adoption; and • policy election that eliminates the need for adjusting prior period comparable financial statements prepared under legacy (Accounting Standards Codification Topic 840) lease accounting guidance. As a result of adopting Topic 842, we recorded additional lease liabilities of approximately $39.3 million and ROU assets of approximately $38.9 million on our consolidated balance sheet. The difference between the lease liabilities and ROU assets is due to rent holiday and lease build-out incentives that were recorded as deferred lease liabilities under legacy accounting guidance. The adoption of Topic 842 did not materially change our consolidated statements of income or consolidated statements of cash flow. See Note 2, "Leases" for further discussion. Accounting Standards Recently Not Yet Adopted In June 2016, the Financial Accounting Standards Board issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326). This amendment replaces the incurred loss impairment methodology in current U.S. GAAP and requires that financial assets be measured on an amortized cost basis and presented at the net amount expected to be collected. This new methodology reflects expected credit losses (rather than probable credit losses) and requires consideration of a broader range of supportable information when determining these estimated credit losses, including relevant experience, current conditions and supportable forecasts to determine collectability. In addition, the amendment provides guidance with regard to the use of an allowance for credit losses for purchased financial assets and available-for-sale debt securities. This amendment becomes effective for fiscal years beginning after December 15, 2019, including interim periods within that fiscal year. We expect to adopt this amendment during fiscal 2021, with no material impact on our consolidated financial statements. |
Nature of Operations and Basi_2
Nature of Operations and Basis of Presentation (Tables) | 3 Months Ended |
Jan. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Disaggregation of Revenue [Table Text Block] | Three Months Ended January 31, 2020 2019 (In thousands) North American Fenestration: United States - fenestration $ 96,847 $ 93,884 International - fenestration 6,434 8,207 United States - non-fenestration 4,563 3,505 International - non-fenestration 2,608 3,453 $ 110,452 $ 109,049 European Fenestration: International - fenestration $ 30,964 $ 30,724 International - non-fenestration 5,802 4,530 $ 36,766 $ 35,254 North American Cabinet Components: United States - fenestration $ 3,147 $ 3,352 United States - non-fenestration 46,450 49,962 International - non-fenestration 447 539 $ 50,044 $ 53,853 Unallocated Corporate & Other Eliminations $ (665 ) $ (1,348 ) $ (665 ) $ (1,348 ) Net sales $ 196,597 $ 196,808 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Jan. 31, 2020 | |
Leases [Abstract] | |
Schedule of Lease-Related Assets and Liabilities | The table below presents the lease-related assets and liabilities recorded on the balance sheet at January 31, 2020 (in thousands): Leases Classification January 31, 2020 Assets Operating lease assets Operating lease right-of-use assets $ 41,661 Finance lease assets Property, plant and equipment (less accumulated depreciation of $308) 16,317 Total lease assets $ 57,978 Liabilities Current Operating Current operating lease liabilities $ 6,532 Finance Current maturities of long-term debt 975 Noncurrent Operating Noncurrent operating lease liabilities 35,505 Finance Long-term debt 14,921 Total lease liabilities $ 57,933 |
Schedule of Components of Lease Costs | The table below presents the components of the lease costs for the three months ended January 31, 2020 (in thousands): Three months ended January 31, 2020 Components of lease costs Operating lease cost $ 2,058 Finance lease cost Amortization of leased assets 316 Interest on lease liabilities 144 Variable lease costs 125 Total lease cost $ 2,643 The table below presents supplemental cash flow information related to leases for the three months ended January 31, 2020 (in thousands): Three months ended January 31, 2020 Supplemental Cash Flow Information Cash paid for amounts included in the measurement of lease liabilities: Finance leases - financing cash flows $ 322 Finance leases - operating cash flows $ 144 Operating leases - operating cash flows $ 2,071 Right-of-use assets obtained in exchange for lease liabilities Operating leases $ 3,082 Finance Leases $ — |
Schedule of Weighted Average Remaining Lease Terms and Weighted Average Discount Rates | The table below presents the weighted average remaining lease terms and weighted average discount rates for the Company's leases as of January 31, 2020: January 31, 2020 Weighted average remaining lease term (in years) Operating leases 8.2 Financing leases 16.4 Weighted average discount rate Operating leases 4.08 % Financing leases 3.64 % |
Schedule of Maturity of Lease Liabilities | The table below presents the maturity of the lease liabilities as of January 31, 2020 (in thousands): Operating Leases Finance Leases (in thousands) 2020 (remaining nine months) $ 6,141 $ 1,177 2021 7,195 1,425 2022 6,531 1,391 2023 6,220 1,294 2024 5,516 1,190 Thereafter 17,730 14,208 Total lease payments 49,333 20,685 Less: present value discount 7,296 4,789 Total lease liabilities $ 42,037 $ 15,896 |
Schedule of Maturity of Lease Liabilities | The table below presents the maturity of the lease liabilities as of January 31, 2020 (in thousands): Operating Leases Finance Leases (in thousands) 2020 (remaining nine months) $ 6,141 $ 1,177 2021 7,195 1,425 2022 6,531 1,391 2023 6,220 1,294 2024 5,516 1,190 Thereafter 17,730 14,208 Total lease payments 49,333 20,685 Less: present value discount 7,296 4,789 Total lease liabilities $ 42,037 $ 15,896 |
Schedule of Future Minimum Lease Payments | These future minimum lease payments were previously disclosed in our 2019 Annual Report on Form 10-K and accounted for under previous lease guidance. Commitments as of October 31, 2019 were as follows: Operating Leases Capital Leases (in thousands) 2020 $ 9,121 $ 1,020 2021 6,981 810 2022 6,012 815 2023 5,506 973 2024 4,699 713 Thereafter 15,220 11,392 Total 47,539 15,723 Less: amount representing interest 5,064 Present value of minimum lease payments 10,659 |
Schedule of Future Minimum Lease Payments | These future minimum lease payments were previously disclosed in our 2019 Annual Report on Form 10-K and accounted for under previous lease guidance. Commitments as of October 31, 2019 were as follows: Operating Leases Capital Leases (in thousands) 2020 $ 9,121 $ 1,020 2021 6,981 810 2022 6,012 815 2023 5,506 973 2024 4,699 713 Thereafter 15,220 11,392 Total 47,539 15,723 Less: amount representing interest 5,064 Present value of minimum lease payments 10,659 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Jan. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories consisted of the following at January 31, 2020 and October 31, 2019 : January 31, October 31, (In thousands) Raw materials $ 40,423 $ 32,818 Finished goods and work in process 39,461 35,538 Supplies and other 2,644 2,593 Total 82,528 70,949 Less: Inventory reserves 4,411 3,790 Inventories, net $ 78,117 $ 67,159 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 3 Months Ended |
Jan. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in the Carrying Amount of Goodwill | The change in the carrying amount of goodwill for the three months ended January 31, 2020 was as follows: Three Months Ended January 31, 2020 (In thousands) Beginning balance as of November 1, 2019 $ 145,563 Foreign currency translation adjustment 1,027 Balance as of the end of the period $ 146,590 The following table summarizes the change in the carrying amount of goodwill by reportable business segment for the three months ended January 31, 2020 (in thousands): NA Fenestration EU Fenestration NA Cabinet Comp. Unallocated Corp. & Other Total Balance as of October 31, 2019 $ 38,712 $ 67,704 $ 39,147 $ — $ 145,563 Foreign currency translation adjustment — 1,027 — — 1,027 Balance as of January 31, 2020 $ 38,712 $ 68,731 $ 39,147 $ — $ 146,590 |
Schedule of Acquired Finite-Lived Intangible Assets by Major Class | Identifiable Intangible Assets Amortizable intangible assets consisted of the following as of January 31, 2020 and October 31, 2019 : January 31, 2020 October 31, 2019 Gross Carrying Amount Accumulated Amortization Gross Carrying Accumulated (In thousands) Customer relationships $ 154,727 $ 73,029 $ 153,950 $ 70,103 Trademarks and trade names 55,988 35,811 55,745 35,210 Patents and other technology 22,397 19,934 22,386 19,471 Total $ 233,112 $ 128,774 $ 232,081 $ 124,784 |
Estimated Amortization Expense Related to Intangible Assets | Estimated remaining amortization expense, based on current intangible balances, for each of the fiscal years ending October 31, is as follows (in thousands): Estimated Amortization Expense 2020 (remaining nine months) $ 10,594 2021 12,619 2022 11,998 2023 11,251 2024 10,520 Thereafter 47,356 Total $ 104,338 |
Debt and Capital Lease Obliga_2
Debt and Capital Lease Obligations (Tables) | 3 Months Ended |
Jan. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt and Capital Lease Obligations | Debt consisted of the following at January 31, 2020 and October 31, 2019 : January 31, October 31, (In thousands) Revolving Credit Facility $ 152,500 $ 142,500 Finance lease obligations and other 16,047 15,865 Unamortized deferred financing fees (1,129 ) (1,205 ) Total debt $ 167,418 $ 157,160 Less: Current maturities of long-term debt 707 746 Long-term debt $ 166,711 $ 156,414 |
Schedule Of Applicable Margin And Commitment Fees | The applicable margin and commitment fees are outlined in the following table: Pricing Level Consolidated Leverage Ratio Commitment Fee LIBOR Rate Loans Base Rate Loans I Less than or equal to 1.50 to 1.00 0.200% 1.25% 0.25% II Greater than 1.50 to 1.00, but less than or equal to 2.25 to 1.00 0.225% 1.50% 0.50% III Greater than 2.25 to 1.00, but less than or equal to 3.00 to 1.00 0.250% 1.75% 0.75% IV Greater than 3.00 to 1.00 0.300% 2.00% 1.00% |
Schedule Of Consolidated Leverage Ratio Requirements | The Credit Facility contains a: (1) Consolidated Interest Coverage Ratio requirement whereby we must not permit the Consolidated Interest Coverage Ratio, as defined, to be less than 2.25 to 1.00, and (2) Consolidated Leverage Ratio requirement, whereby we must not permit the Consolidated Leverage Ratio, as defined, to be greater than 3.25 to 1.00. |
Retirement Plans (Tables)
Retirement Plans (Tables) | 3 Months Ended |
Jan. 31, 2020 | |
Retirement Benefits [Abstract] | |
Net Periodic Pension Cost | he net periodic pension cost for this plan for the three months ended January 31, 2020 and 2019 was as follows: Three Months Ended January 31, 2020 2019 (In thousands) Service cost $ 538 $ 977 Interest cost 293 283 Expected return on plan assets (491 ) (543 ) Amortization of net loss 108 16 Net periodic pension cost $ 448 $ 733 |
Warranty Obligations (Tables)
Warranty Obligations (Tables) | 3 Months Ended |
Jan. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Reconciliation of Activity Related to Accrued Warranty | A reconciliation of the activity related to our accrued warranty, including both the current and long-term portions (reported in accrued liabilities and other liabilities, respectively, on the accompanying condensed consolidated balance sheets) follows: Three Months Ended January 31, 2020 (In thousands) Beginning balance as of November 1, 2019 $ 260 Warranty costs paid (20 ) Total accrued warranty as of January 31, 2020 $ 240 Less: Current portion of accrued warranty 136 Long-term portion of accrued warranty $ 104 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Jan. 31, 2020 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Nonvested Restricted Share Activity | A summary of non-vested restricted stock awards activity during the three months ended January 31, 2020 is presented below: Restricted Stock Awards Weighted Average Non-vested at October 31, 2019 230,100 $ 17.02 Granted 56,000 $ 19.40 Forfeited (27,300 ) $ 17.31 Vested (55,000 ) $ 19.45 Non-vested at January 31, 2020 203,800 $ 16.98 |
Schedule of Stock Option Activity | The following table summarizes our stock option activity for the three months ended January 31, 2020 : Stock Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (000s) Outstanding at October 31, 2019 1,416,186 $ 18.71 Granted — $ — Exercised (178,033 ) $ 16.93 Forfeited/Expired (58,734 ) $ 20.61 Outstanding at January 31, 2020 1,179,419 $ 18.89 4.2 $ 395 Vested or expected to vest at January 31, 2020 1,179,419 $ 18.89 4.2 $ 395 Exercisable at January 31, 2020 1,179,419 $ 18.89 4.2 $ 395 |
Schedule of Performance Share Awards | The following table summarizes our performance share grants and the grant date fair value for the EPS, R-TSR and RONA performance metrics: Grant Date Fair Value Grant Date Shares Awarded EPS R-TSR RONA Shares Forfeited December 7, 2017 146,500 $ 20.70 $ 21.81 $ — 46,608 December 5, 2018 131,500 $ — $ — $ 13.63 33,500 December 5, 2019 55,900 $ — $ — $ 19.40 — |
Schedule of Performance Restricted Stock Vesting Conditions | Depending on the achievement of the performance conditions, a minimum of 0% and a maximum of 150% of the awarded performance restricted stock units may vest. Specifically, the awards vest on a continuum with the following Absolute Total Shareholder Return (A-TSR) milestones: Vesting Level Vesting Criteria Percentage of Award Vested Level 1 A-TSR greater than or equal to 50% 150% Level 2 A-TSR less than 50% and greater than or equal to 20% 100% Level 3 A-TSR less than 20% and greater than or equal to -20% 50% Level 4 A-TSR less than -20% —% |
Performance Restricted Stock Units by Grant [Table Text Block] | Grant Date Shares Awarded Grand Date Fair Value Shares Forfeited December 7, 2017 78,200 $ 17.76 24,854 December 5, 2018 89,200 $ 13.63 25,500 December 5, 2019 35,000 $ 19.40 — |
Treasury Stock Activity | The following table summarizes the treasury stock activity during the three months ended January 31, 2020 : Three Months Ended January 31, 2020 Beginning balance as of November 1, 2019 4,348,613 Restricted stock awards granted (56,000 ) Performance share awards vested (28,051 ) Stock options exercised (178,033 ) Treasury stock repurchases 269,862 Balance at January 31, 2020 4,356,391 |
Other Income (Expense) (Tables)
Other Income (Expense) (Tables) | 3 Months Ended |
Jan. 31, 2020 | |
Other Income and Expenses [Abstract] | |
Schedule of Other Non-operating Income (Expense) | 12. Other Income Other income, included under the caption "Other, net" on the accompanying condensed consolidated statements of income (loss), consisted of the following for the three months ended January 31, 2020 and 2019 : Three Months Ended January 31, 2020 2019 (In thousands) Foreign currency transaction losses $ (49 ) $ (32 ) Foreign currency derivative (losses) gains (11 ) 11 Pension service benefit 90 244 Interest income 5 30 Other 1 3 Other, net $ 36 $ 256 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Jan. 31, 2020 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Segment information for the three months ended January 31, 2020 and 2019 , and total assets as of January 31, 2020 and October 31, 2019 are summarized in the following table (in thousands): NA Fenestration EU Fenestration NA Cabinet Comp. Unallocated Corp. & Other Total Three Months Ended January 31, 2020 Net sales $ 110,452 $ 36,766 $ 50,044 $ (665 ) $ 196,597 Depreciation and amortization 6,979 2,408 3,402 116 12,905 Operating income (loss) 1,631 3,164 (2,115 ) (700 ) 1,980 Capital expenditures 6,928 1,219 1,075 90 9,312 Three Months Ended January 31, 2019 Net sales $ 109,049 $ 35,254 $ 53,853 $ (1,348 ) $ 196,808 Depreciation and amortization 6,873 2,236 3,339 124 12,572 Operating income (loss) 1,843 2,781 (2,267 ) (4,807 ) (2,450 ) Capital expenditures 3,436 1,708 1,127 — 6,271 As of January 31, 2020 Total assets $ 247,396 $ 219,133 $ 181,746 $ 18,925 $ 667,200 As of October 31, 2019 Total assets $ 226,243 $ 212,239 $ 181,416 $ 25,212 $ 645,110 |
Changes in the Carrying Amount of Goodwill | The change in the carrying amount of goodwill for the three months ended January 31, 2020 was as follows: Three Months Ended January 31, 2020 (In thousands) Beginning balance as of November 1, 2019 $ 145,563 Foreign currency translation adjustment 1,027 Balance as of the end of the period $ 146,590 The following table summarizes the change in the carrying amount of goodwill by reportable business segment for the three months ended January 31, 2020 (in thousands): NA Fenestration EU Fenestration NA Cabinet Comp. Unallocated Corp. & Other Total Balance as of October 31, 2019 $ 38,712 $ 67,704 $ 39,147 $ — $ 145,563 Foreign currency translation adjustment — 1,027 — — 1,027 Balance as of January 31, 2020 $ 38,712 $ 68,731 $ 39,147 $ — $ 146,590 |
Reconciliation of Operating Profit (Loss) from Segments to Consolidated [Table Text Block] | We did not allocate non-operating loss or income tax benefit to the reportable segments. The following table reconciles operating income (loss) as reported above to net income (loss) for the three months ended January 31, 2020 and 2019 : Three Months Ended January 31, 2020 2019 (In thousands) Operating income (loss) $ 1,980 $ (2,450 ) Interest expense (1,582 ) (2,442 ) Other, net 36 256 Income tax (expense) benefit (424 ) 987 Net income (loss) $ 10 $ (3,649 ) |
Earnings Per Share Earnings Per
Earnings Per Share Earnings Per Share (Tables) | 3 Months Ended |
Jan. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | Basic and diluted earnings (loss) per share for the three months ended January 31, 2020 and 2019 were calculated as follows (in thousands, except per share data): Net Income (Loss) Weighted Average Shares Per Share Three Months Ended January 31, 2020 Basic earnings per common share $ 10 32,861 $ — Effect of dilutive securities: Stock options 77 Restricted stock awards 93 Performance shares 28 Performance restricted stock units 19 Diluted earnings per common share $ 10 33,078 $ — Three Months Ended January 31, 2019 Basic loss per common share $ (3,649 ) 33,098 $ (0.11 ) Diluted loss per common share (1) $ (3,649 ) 33,098 $ (0.11 ) (1) The computation of diluted earnings per share excludes outstanding stock options and other common stock equivalents when their inclusion would be anti-dilutive. This is always the case when an entity incurs a net loss. During the three months ended January 31, 2019, 6,775 shares of common stock equivalent and 96,507 shares of restricted stock were excluded from the computation of diluted earnings per share. In addition 15,735 potentially dilutive contingent shares related to performance share awards for the three months ended 2019 were excluded. |
Nature of Operations and Basi_3
Nature of Operations and Basis of Presentation (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jan. 31, 2020 | Oct. 31, 2019 | |
Restructuring Cost and Reserve [Line Items] | ||
Accounts receivable, net of allowance for doubtful accounts of $549 and $393 | $ 64,036 | $ 82,946 |
NA Fenestration [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring costs | 100 | |
NA Cabinet Components | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring costs | $ 100 |
Nature of Operations and Basi_4
Nature of Operations and Basis of Presentation Summary of Product Sales (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jan. 31, 2020 | Jan. 31, 2019 | |
Product Information [Line Items] | ||
Total sales | $ 196,597 | $ 196,808 |
Operating Segments | NA Engineered Components | ||
Product Information [Line Items] | ||
Total sales | 110,452 | 109,049 |
Operating Segments | NA Engineered Components | International [Member] | Non-fenestration [Member] | ||
Product Information [Line Items] | ||
Total sales | 2,608 | 3,453 |
Operating Segments | NA Engineered Components | International [Member] | Fenestration [Member] | ||
Product Information [Line Items] | ||
Total sales | 6,434 | 8,207 |
Operating Segments | NA Engineered Components | United States | Non-fenestration [Member] | ||
Product Information [Line Items] | ||
Total sales | 4,563 | 3,505 |
Operating Segments | NA Engineered Components | United States | Fenestration [Member] | ||
Product Information [Line Items] | ||
Total sales | 96,847 | 93,884 |
Operating Segments | EU Engineered Components | ||
Product Information [Line Items] | ||
Total sales | 36,766 | 35,254 |
Operating Segments | EU Engineered Components | International [Member] | Non-fenestration [Member] | ||
Product Information [Line Items] | ||
Total sales | 5,802 | 4,530 |
Operating Segments | EU Engineered Components | International [Member] | Fenestration [Member] | ||
Product Information [Line Items] | ||
Total sales | 30,964 | 30,724 |
Operating Segments | NA Cabinet Components | ||
Product Information [Line Items] | ||
Total sales | 50,044 | 53,853 |
Operating Segments | NA Cabinet Components | International [Member] | Non-fenestration [Member] | ||
Product Information [Line Items] | ||
Total sales | 447 | 539 |
Operating Segments | NA Cabinet Components | United States | Non-fenestration [Member] | ||
Product Information [Line Items] | ||
Total sales | 46,450 | 49,962 |
Operating Segments | NA Cabinet Components | United States | Fenestration [Member] | ||
Product Information [Line Items] | ||
Total sales | 3,147 | 3,352 |
Corporate Non-Segment | ||
Product Information [Line Items] | ||
Total sales | $ (665) | $ (1,348) |
Leases - Additional Information
Leases - Additional Information (Details) | Jan. 31, 2020 |
Real Estate-Related | Minimum | |
Lessee, Lease, Description [Line Items] | |
Term of contract | 5 years |
Real Estate-Related | Maximum | |
Lessee, Lease, Description [Line Items] | |
Term of contract | 20 years |
Equipment-Related | Minimum | |
Lessee, Lease, Description [Line Items] | |
Term of contract | 1 year |
Equipment-Related | Maximum | |
Lessee, Lease, Description [Line Items] | |
Term of contract | 10 years |
Leases - Lease-Related Assets a
Leases - Lease-Related Assets and Liabilities (Details) - USD ($) $ in Thousands | Jan. 31, 2020 | Oct. 31, 2019 |
Assets | ||
Operating lease right-of-use assets | $ 41,661 | $ 0 |
Property, plant and equipment | 16,317 | |
Property, plant and equipment, accumulated depreciation | 308 | |
Total lease assets | 57,978 | |
Current | ||
Current operating lease liabilities | 6,532 | 0 |
Current maturities of long-term debt | 975 | |
Noncurrent | ||
Noncurrent operating lease liabilities | 35,505 | $ 0 |
Long-term debt | 14,921 | |
Total lease liabilities | $ 57,933 |
Leases - Lease Costs (Details)
Leases - Lease Costs (Details) $ in Thousands | 3 Months Ended |
Jan. 31, 2020USD ($) | |
Components of lease costs | |
Operating lease cost | $ 2,058 |
Finance lease cost, Amortization of leased assets | 316 |
Finance lease cost, Interest on lease liabilities | 144 |
Variable lease costs | 125 |
Total lease cost | $ 2,643 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) $ in Thousands | 3 Months Ended |
Jan. 31, 2020USD ($) | |
Cash paid for amounts included in the measurement of lease liabilities: | |
Finance leases - financing cash flows | $ 322 |
Finance leases - operating cash flows | 144 |
Operating leases - operating cash flows | 2,071 |
Right-of-use assets obtained in exchange for lease liabilities | |
Operating leases | 3,082 |
Finance Leases | $ 0 |
Leases - Weighted Average Remai
Leases - Weighted Average Remaining Lease Terms and Weighted Average Discount Rates (Details) | Jan. 31, 2020 |
Weighted average remaining lease term (in years) | |
Operating leases | 8 years 2 months 12 days |
Financing leases | 16 years 4 months 24 days |
Weighted average discount rate | |
Operating leases | 4.08% |
Financing leases | 3.64% |
Leases - Present Maturity of Le
Leases - Present Maturity of Lease Liabilities (Details) $ in Thousands | Jan. 31, 2020USD ($) |
Operating Leases | |
2020 (remaining nine months) | $ 6,141 |
2021 | 7,195 |
2022 | 6,531 |
2023 | 6,220 |
2024 | 5,516 |
Thereafter | 17,730 |
Total lease payments | 49,333 |
Less: Imputed interest | 7,296 |
Total lease liabilities | 42,037 |
Finance Leases | |
2020 (remaining nine months) | 1,177 |
2021 | 1,425 |
2022 | 1,391 |
2023 | 1,294 |
2024 | 1,190 |
Thereafter | 14,208 |
Total lease payments | 20,685 |
Less: Imputed interest | 4,789 |
Total lease liabilities | $ 15,896 |
Leases - Future Minimum Lease P
Leases - Future Minimum Lease Payments (Details) $ in Thousands | Oct. 31, 2019USD ($) |
Operating Leases | |
2020 | $ 9,121 |
2021 | 6,981 |
2022 | 6,012 |
2023 | 5,506 |
2024 | 4,699 |
Thereafter | 15,220 |
Total | 47,539 |
Capital Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |
2020 | 1,020 |
2021 | 810 |
2022 | 815 |
2023 | 973 |
2024 | 713 |
Thereafter | 11,392 |
Total | 15,723 |
Less: amount representing interest | 5,064 |
Present value of minimum lease payments | $ 10,659 |
Inventories (Detail)
Inventories (Detail) - USD ($) $ in Thousands | Jan. 31, 2020 | Oct. 31, 2019 |
Inventories, net | $ 78,117 | $ 67,159 |
Deferred income taxes | 19,741 | 19,363 |
Retained earnings | 182,989 | 185,703 |
Inventory, Raw Materials and Supplies, Net of Reserves [Abstract] | ||
Raw materials | 40,423 | 32,818 |
Finished goods and work in process | 39,461 | 35,538 |
Supplies and other | 2,644 | 2,593 |
Total | 82,528 | 70,949 |
Less: Inventory reserves | 4,411 | 3,790 |
Inventories, net | $ 78,117 | $ 67,159 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Goodwill (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jan. 31, 2020 | Jan. 31, 2019 | |
Goodwill [Line Items] | ||
Goodwill, Impairment Loss | $ (30,000) | $ (74,600) |
Goodwill [Roll Forward] | ||
Beginning balance | 145,563 | |
Foreign currency translation adjustment | 1,027 | |
Balance as of the end of the period | 146,590 | |
NA Cabinet Components | ||
Goodwill [Roll Forward] | ||
Beginning balance | $ 39,100 | $ 113,700 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Identifiable Intangible Assets (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||
Jan. 31, 2020 | Jan. 31, 2019 | Oct. 31, 2019 | |
Finite-Lived Intangible Assets [Line Items] | |||
Accumulated amortization | $ 128,774 | $ 124,784 | |
Finite-Lived Intangible Assets, Gross | 233,112 | 232,081 | |
Intangible assets amortization expense | 3,700 | $ 4,000 | |
Estimated Amortization Expense | |||
2020 (remaining nine months) | 10,594 | ||
2016 | 12,619 | ||
2017 | 11,998 | ||
2018 | 11,251 | ||
2019 | 10,520 | ||
Thereafter | 47,356 | ||
Total | 104,338 | 107,297 | |
Customer relationships | |||
Finite-Lived Intangible Assets [Line Items] | |||
Accumulated amortization | 73,029 | 70,103 | |
Finite-Lived Intangible Assets, Gross | 154,727 | 153,950 | |
Trademarks and trade names | |||
Finite-Lived Intangible Assets [Line Items] | |||
Accumulated amortization | 35,811 | 35,210 | |
Finite-Lived Intangible Assets, Gross | 55,988 | 55,745 | |
Patents And Other Technology [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Accumulated amortization | 19,934 | 19,471 | |
Finite-Lived Intangible Assets, Gross | $ 22,397 | $ 22,386 |
Debt and Capital Lease Obliga_3
Debt and Capital Lease Obligations (Detail) - USD ($) | 3 Months Ended | ||
Jan. 31, 2020 | Jan. 31, 2019 | Oct. 31, 2019 | |
Debt Disclosure [Line Items] | |||
Borrowings under credit facility | $ 34,500,000 | $ 43,000,000 | |
Document Period End Date | Jan. 31, 2020 | ||
City of Richmond, Kentucky Industrial Building Revenue Bonds | $ 16,000,000 | ||
Deferred Finance Costs, Own-share Lending Arrangement, Issuance Costs, Net | (1,129,000) | $ (1,205,000) | |
Total debt | 167,418,000 | 157,160,000 | |
Less: Current maturities of long-term debt | 707,000 | 746,000 | |
Long-term Debt | $ 166,711,000 | 156,414,000 | |
Debt Instrument, Interest Rate During Period | 3.27% | 4.03% | |
Repayments of Lines of Credit | $ 24,500,000 | $ 23,000,000 | |
Debt Instrument, Unamortized Discount (Premium), Net | 1,100,000 | ||
Other assets | 9,265,000 | 8,324,000 | |
Debt Disclosure [Abstract] | |||
Credit Facility, amount available | 167,700,000 | ||
Letters of credit, outstanding | $ 4,800,000 | ||
Term Loan Facility [Member] | |||
Debt Disclosure [Line Items] | |||
Debt Instrument, Interest Rate, Stated Percentage | 3.15% | ||
Capital Lease Obligations | |||
Debt Disclosure [Line Items] | |||
Finance lease obligations and other | $ 16,047,000 | 15,865,000 | |
Revolving Credit Facility [Member] | |||
Debt Disclosure [Line Items] | |||
Revolving Credit Facility | 152,500,000 | $ 142,500,000 | |
2018 Credit Facility [Member] | |||
Debt Disclosure [Line Items] | |||
Revolving Credit Facility | 152,500,000 | ||
2018 Credit Facility [Member] | Line of Credit [Member] | |||
Debt Disclosure [Line Items] | |||
Line of Credit Facility, Maximum Borrowing Capacity, Committed Amount | $ 325,000,000 | ||
Debt Instrument, Debt Default, Interest Accrual Rate | 2.00% | ||
Debt Instrument, Required Leverage Ratio | 0.0325 | ||
Debt Instrument, Limitation on Annual Dividend | $ 20,000,000 | ||
Debt Instrument, Maximum Fixed Charge Coverage Ratio | 2.25% | ||
Less Than One and One Half Leverage Ratio [Member] | 2018 Credit Facility [Member] | Line of Credit [Member] | |||
Debt Disclosure [Line Items] | |||
Commitment Fee Percentage | 0.20% | ||
Less Than One and One Half Leverage Ratio [Member] | Base Rate [Member] | 2018 Credit Facility [Member] | Line of Credit [Member] | |||
Debt Disclosure [Line Items] | |||
Debt Instrument, Basis Spread on Variable Rate | 0.25% | ||
Less Than One and One Half Leverage Ratio [Member] | London Interbank Offered Rate (LIBOR) [Member] | 2018 Credit Facility [Member] | Line of Credit [Member] | |||
Debt Disclosure [Line Items] | |||
Debt Instrument, Basis Spread on Variable Rate | 1.25% | ||
Between One and One Half and Two and One Quarter Leverage Ratio [Member] | 2018 Credit Facility [Member] | Line of Credit [Member] | |||
Debt Disclosure [Line Items] | |||
Commitment Fee Percentage | 0.225% | ||
Between One and One Half and Two and One Quarter Leverage Ratio [Member] | Base Rate [Member] | 2018 Credit Facility [Member] | Line of Credit [Member] | |||
Debt Disclosure [Line Items] | |||
Debt Instrument, Basis Spread on Variable Rate | 0.50% | ||
Between One and One Half and Two and One Quarter Leverage Ratio [Member] | London Interbank Offered Rate (LIBOR) [Member] | 2018 Credit Facility [Member] | Line of Credit [Member] | |||
Debt Disclosure [Line Items] | |||
Debt Instrument, Basis Spread on Variable Rate | 1.50% | ||
Between Two and One Quarter and Three Leverage Ratio [Member] | 2018 Credit Facility [Member] | Line of Credit [Member] | |||
Debt Disclosure [Line Items] | |||
Commitment Fee Percentage | 0.25% | ||
Between Two and One Quarter and Three Leverage Ratio [Member] | Base Rate [Member] | 2018 Credit Facility [Member] | Line of Credit [Member] | |||
Debt Disclosure [Line Items] | |||
Debt Instrument, Basis Spread on Variable Rate | 0.75% | ||
Between Two and One Quarter and Three Leverage Ratio [Member] | London Interbank Offered Rate (LIBOR) [Member] | 2018 Credit Facility [Member] | Line of Credit [Member] | |||
Debt Disclosure [Line Items] | |||
Debt Instrument, Basis Spread on Variable Rate | 1.75% | ||
Greater Than Three Leverage Ratio [Member] | 2018 Credit Facility [Member] | Line of Credit [Member] | |||
Debt Disclosure [Line Items] | |||
Commitment Fee Percentage | 0.30% | ||
Greater Than Three Leverage Ratio [Member] | Base Rate [Member] | 2018 Credit Facility [Member] | Line of Credit [Member] | |||
Debt Disclosure [Line Items] | |||
Debt Instrument, Basis Spread on Variable Rate | 1.00% | ||
Greater Than Three Leverage Ratio [Member] | London Interbank Offered Rate (LIBOR) [Member] | 2018 Credit Facility [Member] | Line of Credit [Member] | |||
Debt Disclosure [Line Items] | |||
Debt Instrument, Basis Spread on Variable Rate | 2.00% |
Retirement Plans (Detail)
Retirement Plans (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Jan. 31, 2020 | Jan. 31, 2019 | Oct. 31, 2018 | Oct. 31, 2019 | |
Retirement Benefits [Abstract] | ||||
Defined Benefit Plan, Benefit Obligation, Actuarial Gain (Loss) | $ 2,500 | |||
Defined benefit plan, contributions by employer | $ 700 | |||
Defined Benefit Plan, Expected Future Employer Contributions, Next Fiscal Year | 3,700 | |||
Supplemental benefit plan liability | 4,300 | $ 4,200 | ||
Deferred compensation liability | 3,700 | $ 3,800 | ||
Net periodic benefit cost: | ||||
Service cost | 538 | $ 977 | ||
Interest cost | 293 | 283 | ||
Expected return on plan assets | (491) | (543) | ||
Amortization of net loss | 108 | 16 | ||
Net periodic benefit cost | $ 448 | $ 733 |
Warranty Obligations (Detail)
Warranty Obligations (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Jan. 31, 2020 | Jan. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Standard Product Warranty Accrual, Increase (Decrease) for Preexisting Warranties | $ 0 | |
Movement in Standard Product Warranty Accrual [Roll Forward] | ||
Accrued warranty at beginning of period | 260 | |
Warranty costs paid | (20) | |
Accrued warranty at end of period | 240 | |
Total accrued warranty | $ 240 | $ 240 |
Less: Current portion of accrued warranty | 136 | |
Long-term portion of accrued warranty | $ 104 |
Income Taxes (Detail)
Income Taxes (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2020 | Jan. 31, 2019 | |
Income Tax Disclosure | ||
Document Period End Date | Jan. 31, 2020 | |
Estimated annual effective tax rate (benefit) expense | (20.50%) | (24.00%) |
Deemed Repatriation, Impact of Tax Reform | $ (0.6) | |
Tax Cuts and Jobs Act of 2017, Excess Tax Benefits | 0.3 | |
Tax Cuts and Jobs Act of 2017, GILTI and FDII | $ 1.4 | |
Liability for uncertain tax positions | $ 0.6 | |
Valuation allowance | $ 1.6 |
Fair Value Measurement of Ass_2
Fair Value Measurement of Assets and Liabilities (Details) $ in Millions | Jan. 31, 2020USD ($) |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Debt Instrument, Unamortized Discount (Premium), Net | $ 1.1 |
Fair Value, Inputs, Level 2 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Foreign currency derivatives, asset | $ 0.1 |
Stock Based Compensation (Detai
Stock Based Compensation (Detail) | 3 Months Ended |
Jan. 31, 2020shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Document Period End Date | Jan. 31, 2020 |
Number of shares authorized, originally | 7,650,000 |
Stock-Based Compensation - Rest
Stock-Based Compensation - Restricted Stock Awards (Details) - Restricted Stock Awards (RSAs) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
Jan. 31, 2020 | Jan. 31, 2019 | |
Number of Shares | ||
Non-vested at beginning of the period (in shares) | 230,100 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 56,000 | |
Cancelled (in shares) | (27,300) | |
Vested (in shares) | (55,000) | |
Non-vested at end of the period (in shares) | 203,800 | |
Weighted Average Grant Date Fair Value per Share | ||
Non-vested at beginning of the period (in usd per share) | $ 17.02 | |
Granted (in usd per share) | 19.40 | |
Cancelled (in usd per share) | 17.31 | |
Vested (in usd per share) | 19.45 | |
Non-vested at end of the period (in usd per share) | $ 16.98 | |
Fair value of restricted stock awards vested | $ 1.1 | $ 1.3 |
Unrecognized compensation cost - non vested restricted stock awards | $ 2.2 | |
Weighted-average period over which unrecognized cost is expected to be recognized | 2 years 2 months 12 days |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock Options (Details) - USD ($) | 3 Months Ended | |
Jan. 31, 2020 | Jan. 31, 2019 | |
Stock Options, [Roll Forward] | ||
Outstanding at beginning of period (in shares) | 1,416,186 | |
Granted (in shares) | 0 | |
Exercised (in shares) | (178,033) | |
Forfeited/Expired (in shares) | (58,734) | |
Outstanding at end of period (in shares) | 1,179,419 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Number | 1,179,419 | |
Exercisable at end of period (in shares) | 1,179,419 | |
Weighted Average Exercise Price | ||
Outstanding at beginning of period (in usd per share) | $ 18.71 | |
Granted (in usd per share) | 0 | |
Exercised (in usd per share) | 16.93 | |
Forfeited/Expired (in usd per share) | 20.61 | |
Outstanding at end of period (in usd per share) | 18.89 | |
Vested or expected to vest at end of period (in usd per share) | 18.89 | |
Exercisable at end of period (in usd per share) | $ 18.89 | |
Weighted Average Remaining Contractual Life | ||
Outstanding at end of period | 4 years 2 months 12 days | |
Vested or expected to vest at end of period | 4 years 2 months 12 days | |
Exercisable at end of period | 4 years 2 months 12 days | |
Aggregate Intrinsic Value | ||
Outstanding at end of period | $ 395,000 | |
Vested or expected to vest at end of period | 395,000 | |
Exercisable at end of period | 395,000 | |
Stock Options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total intrinsic value of options exercised | 500,000 | $ 100,000 |
Fair value of stock options vested | $ 400,000 | $ 1,100,000 |
Stock-Based Compensation - Re_2
Stock-Based Compensation - Restricted Stock Units (Details) - USD ($) | 3 Months Ended | |
Jan. 31, 2020 | Jan. 31, 2019 | |
Restricted Stock Units (RSUs) | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 25,326 | 25,920 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value | $ 19.02 | $ 15.31 |
Restricted Stock or Unit Expense | $ 100,000 | |
Key Employee Restricted Stock Units [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 26,390 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value | $ 17.01 |
Stock-Based Compensation - Perf
Stock-Based Compensation - Performance Share Awards (Details) - USD ($) $ / shares in Units, $ in Millions | Dec. 05, 2019 | Dec. 05, 2018 | Dec. 07, 2017 | Jan. 31, 2020 | Jan. 31, 2019 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Employee Service Share-based Compensation, Cash Flow Effect, Cash Used to Settle Awards | $ 0.6 | ||||
2016 Performance Shares Vested | 56,103 | ||||
Shares granted for performance share vesting | 28,051 | ||||
Earnings Per Share, Basic and Diluted | $ 0 | $ 0 | $ 20.70 | ||
Relative Total Share Return | 0 | 0 | 21.81 | ||
Return On Net Assets | $ 19.40 | $ 13.63 | $ 0 | ||
Performance Shares | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Performance shares settled in cash | 50.00% | ||||
Performance shares settled in stock | 50.00% | ||||
Performance shares granted | 55,900 | 131,500 | 146,500 | ||
Performance shares forfeited | 0 | 33,500 | 46,608 | ||
Performance shares compensation expense | $ 0.5 | $ 0.3 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Number | 18,730 | ||||
Performance Shares | Minimum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Performance shares vesting percentage maximum | 0.00% | ||||
Performance Shares | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Performance shares vesting percentage maximum | 200.00% | ||||
Performance Restricted Stock Units [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Performance shares granted | 35,000 | 89,200 | 78,200 | ||
Performance shares forfeited | 0 | 25,500 | 24,854 | ||
Performance shares compensation expense | $ 0.1 | $ 0.2 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Number | 28,449 | ||||
Performance Restricted Stock Units [Member] | Minimum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Performance shares vesting percentage maximum | 0.00% | ||||
Performance Restricted Stock Units [Member] | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Performance shares vesting percentage maximum | 150.00% |
Stock-Based Compensation - Pe_2
Stock-Based Compensation - Performance Restricted Stock Units (Details) - USD ($) $ / shares in Units, $ in Millions | Dec. 05, 2019 | Dec. 05, 2018 | Dec. 07, 2017 | Jan. 31, 2020 | Jan. 31, 2019 |
Key Employee Restricted Stock Units [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Granted (in usd per share) | $ 17.01 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 26,390 | ||||
Performance Restricted Stock Units [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Performance Restricted Stock Units Granted | 35,000 | 89,200 | 78,200 | ||
Granted (in usd per share) | $ 19.40 | $ 13.63 | $ 17.76 | ||
Performance restricted stock units shares forfeited | 0 | 25,500 | 24,854 | ||
Allocated Share-based Compensation Expense | $ 0.1 | $ 0.2 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding, Number | 28,449 | ||||
Performance Restricted Stock Units [Member] | Level 1 [Member] | A-TSR greater than or equal to 50% [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Performance restricted stock units vesting percentage maximum | 150.00% | ||||
Performance Restricted Stock Units [Member] | Level 2 [Member] | A-TSR less than 50% and greater than or equal to 20% [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Performance restricted stock units vesting percentage maximum | 100.00% | ||||
Performance Restricted Stock Units [Member] | Level 3 [Member] | A-TSR less than 20% and greater than or equal to -20% [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Performance restricted stock units vesting percentage maximum | 50.00% | ||||
Performance Restricted Stock Units [Member] | Level 4 [Member] | A-TSR less than -20% [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Performance restricted stock units vesting percentage maximum | 0.00% | ||||
Performance Restricted Stock Units [Member] | Minimum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Performance restricted stock units vesting percentage maximum | 0.00% | ||||
Performance Restricted Stock Units [Member] | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Performance restricted stock units vesting percentage maximum | 150.00% |
Stock-Based Compensation - Trea
Stock-Based Compensation - Treasury Shares (Details) $ in Millions | 3 Months Ended |
Jan. 31, 2020USD ($)shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Document Period End Date | Jan. 31, 2020 |
Deficiency of stock option proceeds recorded to retained earnings | $ | $ 0.1 |
Treasury Stock [Abstract] | |
Beginning balance as of November 1, 2019 | 4,348,613 |
Shares, Issued | (178,033) |
Stock Repurchased During Period, Shares | 269,862 |
Balance at January 31, 2020 | 4,356,391 |
Restricted Stock Awards (RSAs) | |
Treasury Stock [Abstract] | |
Restricted stock awards granted | (56,000) |
Performance Shares | |
Treasury Stock [Abstract] | |
Restricted stock awards granted | (28,051) |
Other Income (Expense) (Detail)
Other Income (Expense) (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Jan. 31, 2020 | Jan. 31, 2019 | |
Other Income and Expenses [Abstract] | ||
Foreign currency transaction losses | $ (49) | $ (32) |
Foreign currency derivative (losses) gains | (11) | 11 |
Pension Service Benefit | 90 | 244 |
Interest income | 5 | 30 |
Other | 1 | 3 |
Other, net | $ 36 | $ 256 |
Segment Information (Details)
Segment Information (Details) $ in Millions | 3 Months Ended | |
Jan. 31, 2020USD ($)segment | Jan. 31, 2019USD ($) | |
Segment Reporting Information [Line Items] | ||
Number of reportable segments | 3 | |
Allocated corporate general and administrative expense | $ | $ 5.5 | $ 4.8 |
Operating Segments | NA Engineered Components | ||
Segment Reporting Information [Line Items] | ||
Number of operating segments | 3 |
Segment Information Segment Rep
Segment Information Segment Reporting Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Jan. 31, 2020 | Jan. 31, 2019 | Oct. 31, 2019 | |
Segment Reporting Information [Line Items] | |||
Net sales | $ 196,597 | $ 196,808 | |
General and Administrative Expense | 5,500 | 4,800 | |
Depreciation and amortization | 12,905 | 12,572 | |
Operating income (loss) | 1,980 | (2,450) | |
Capital expenditures | 9,312 | 6,271 | |
Total assets | 667,200 | $ 645,110 | |
Operating Segments | NA Fenestration [Member] | |||
Segment Reporting Information [Line Items] | |||
Net sales | 110,452 | 109,049 | |
Depreciation and amortization | 6,979 | 6,873 | |
Operating income (loss) | 1,631 | 1,843 | |
Capital expenditures | 6,928 | 3,436 | |
Total assets | 247,396 | 226,243 | |
Operating Segments | EU Engineered Components | |||
Segment Reporting Information [Line Items] | |||
Net sales | 36,766 | 35,254 | |
Depreciation and amortization | 2,408 | 2,236 | |
Operating income (loss) | 3,164 | 2,781 | |
Capital expenditures | 1,219 | 1,708 | |
Total assets | 219,133 | 212,239 | |
Operating Segments | NA Cabinet Components | |||
Segment Reporting Information [Line Items] | |||
Net sales | 50,044 | 53,853 | |
Depreciation and amortization | 3,402 | 3,339 | |
Operating income (loss) | (2,115) | (2,267) | |
Capital expenditures | 1,075 | 1,127 | |
Total assets | 181,746 | 181,416 | |
Corporate Non-Segment | |||
Segment Reporting Information [Line Items] | |||
Net sales | (665) | (1,348) | |
Depreciation and amortization | 116 | 124 | |
Operating income (loss) | (700) | (4,807) | |
Capital expenditures | 90 | $ 0 | |
Total assets | $ 18,925 | $ 25,212 |
Segment Information Goodwill by
Segment Information Goodwill by Segment (Details) $ in Thousands | 3 Months Ended |
Jan. 31, 2020USD ($) | |
Goodwill [Line Items] | |
Beginning balance | $ 145,563 |
Foreign currency translation adjustment | 1,027 |
Balance as of the end of the period | 146,590 |
NA Cabinet Components | |
Goodwill [Line Items] | |
Beginning balance | 39,100 |
Operating Segments | NA Engineered Components | |
Goodwill [Line Items] | |
Beginning balance | 38,712 |
Foreign currency translation adjustment | 0 |
Balance as of the end of the period | 38,712 |
Operating Segments | EU Engineered Components | |
Goodwill [Line Items] | |
Beginning balance | 67,704 |
Balance as of the end of the period | 68,731 |
Operating Segments | NA Cabinet Components | |
Goodwill [Line Items] | |
Beginning balance | 39,147 |
Foreign currency translation adjustment | 0 |
Balance as of the end of the period | 39,147 |
Corporate Non-Segment | |
Goodwill [Line Items] | |
Beginning balance | 0 |
Foreign currency translation adjustment | 0 |
Balance as of the end of the period | $ 0 |
Segment Information Reconcillia
Segment Information Reconcilliation of Operating Loss to Net Income (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jan. 31, 2020 | Jan. 31, 2019 | |
Segment Reporting [Abstract] | ||
Operating loss | $ 1,980 | $ (2,450) |
Interest expense | (1,582) | (2,442) |
Other, net | 36 | 256 |
Income tax (expense) benefit | (424) | 987 |
Net Income (Loss) | $ 10 | $ (3,649) |
Earnings Per Share (Detail)
Earnings Per Share (Detail) - USD ($) $ / shares in Units, $ in Thousands | Dec. 05, 2019 | Dec. 05, 2018 | Dec. 07, 2017 | Jan. 31, 2020 | Jan. 31, 2019 |
Earnings Per Share Disclosure [Line Items] | |||||
Basic earnings per common share | $ 10 | $ (3,649) | |||
Diluted earnings per common share | $ 10 | $ (3,649) | |||
Basic (in shares) | 32,861,000 | 33,098,000 | |||
Earnings Per Share, Basic | $ 0 | $ 0.11 | |||
Diluted (in shares) | 33,078,000 | 33,098,000 | |||
Earnings Per Share, Diluted | $ 0 | $ (0.11) | |||
Earnings Per Share, Basic and Diluted | $ 0 | $ 0 | $ 20.70 | ||
Earnings Per Share, Diluted | $ 0 | $ (0.11) | |||
Stock Options | |||||
Earnings Per Share Disclosure [Line Items] | |||||
Antidilutive securities (in shares) | 772,756 | 1,694,464 | |||
Restricted Stock Awards (RSAs) | |||||
Earnings Per Share Disclosure [Line Items] | |||||
Antidilutive securities (in shares) | 56,000 | ||||
Stock Options | |||||
Earnings Per Share Disclosure [Line Items] | |||||
Weighted Average Number Diluted Shares Outstanding Adjustment | 77,000 | 6,775 | |||
Restricted Stock Awards (RSAs) | |||||
Earnings Per Share Disclosure [Line Items] | |||||
Weighted Average Number Diluted Shares Outstanding Adjustment | 93,000 | 96,507 | |||
Performance Shares | |||||
Earnings Per Share Disclosure [Line Items] | |||||
Weighted Average Number Diluted Shares Outstanding Adjustment | 28,000 | 15,735 | |||
Performance Restricted Stock Units [Member] | |||||
Earnings Per Share Disclosure [Line Items] | |||||
Weighted Average Number Diluted Shares Outstanding Adjustment | 19,000 |
New Accounting Guidance Adopt_2
New Accounting Guidance Adopted (Details) - USD ($) $ in Thousands | Jan. 31, 2020 | Nov. 01, 2019 | Oct. 31, 2019 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Total lease liabilities | $ 42,037 | ||
Operating lease right-of-use assets | $ 41,661 | $ 0 | |
Accounting Standards Update 2016-02 [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Total lease liabilities | $ 39,300 | ||
Operating lease right-of-use assets | $ 38,900 |