Cover
Cover - USD ($) | 12 Months Ended | ||
Oct. 31, 2022 | Dec. 08, 2022 | Apr. 30, 2022 | |
Entity Information [Line Items] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Oct. 31, 2022 | ||
Current Fiscal Year End Date | --10-31 | ||
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, $0.01 par value | ||
Trading Symbol | NX | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 630,566,743 | ||
Entity Common Stock, Shares Outstanding | 33,130,250 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Central Index Key | 0001423221 | ||
Documents Incorporated by Reference | Portions of the Registrant’s definitive Proxy Statement for its 2023 Annual Meeting of Stockholders to be filed with the Commission within 120 days of October 31, 2022 are incorporated herein by reference in Part III of this Annual Report on Form 10-K. | ||
ICFR Auditor Attestation Flag | true |
Audit Information
Audit Information | 12 Months Ended |
Oct. 31, 2022 | |
Audit Information [Abstract] | |
Auditor Name | Grant Thornton LLP |
Auditor Location | Houston, Texas |
Auditor Firm ID | 248 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Oct. 31, 2022 | Oct. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 55,093 | $ 40,061 |
Accounts receivable, net of allowance for credit losses of $289 and $340 | 96,018 | 108,309 |
Inventories, net | 120,890 | 92,529 |
Prepaid and other current assets | 8,664 | 8,148 |
Total current assets | 280,665 | 249,047 |
Property, plant and equipment, net of accumulated depreciation of $348,528 and $336,493 | 180,400 | 178,630 |
Operating lease right-of-use assets | 56,000 | 52,708 |
Goodwill | 137,855 | 149,205 |
Intangible assets, net | 65,035 | 82,410 |
Other assets | 4,662 | 5,323 |
Total assets | 724,617 | 717,323 |
Current liabilities: | ||
Accounts payable | 77,907 | 86,765 |
Accrued liabilities | 52,114 | 56,156 |
Income taxes payable | 1,049 | 6,038 |
Current maturities of long-term debt | 1,046 | 846 |
Current operating lease liabilities | 7,727 | 8,196 |
Total current liabilities | 139,843 | 158,001 |
Long-term debt | 29,628 | 52,094 |
Noncurrent operating lease liabilities | 49,286 | 45,367 |
Deferred pension and postretirement benefits | 3,917 | 4,737 |
Deferred income taxes | 22,277 | 21,965 |
Liability for uncertain tax positions | 1,361 | 1,388 |
Other liabilities | 13,470 | 13,989 |
Total liabilities | 259,782 | 297,541 |
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 37,211,056 and 37,273,510 respectively; outstanding 33,129,250 and 33,274,785, respectively | 372 | 373 |
Additional paid-in-capital | 251,947 | 254,162 |
Retained earnings | 337,456 | 259,718 |
Accumulated other comprehensive loss | (49,422) | (21,770) |
Less: Treasury stock at cost, 4,081,806 and 3,998,725 shares, respectively | (75,518) | (72,701) |
Total stockholders’ equity | 464,835 | 419,782 |
Total liabilities and stockholders' equity | $ 724,617 | $ 717,323 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Oct. 31, 2022 | Oct. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 289 | $ 340 |
Accumulated Depreciation of Property, Plant, and Equipment | $ 348,528 | $ 336,493 |
Preferred stock, par value (usd per share) | $ 0 | $ 0 |
Preferred stock, shares authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 125,000,000 | 125,000,000 |
Common stock, shares, issued (in shares) | 37,211,056 | 37,273,510 |
Common stock, shares, outstanding (in shares) | 33,129,250 | 33,274,785 |
Treasury shares (in shares) | 4,081,806 | 3,998,725 |
Consolidated Statements of Inco
Consolidated Statements of Income (Loss) - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Income Statement [Abstract] | |||
Net sales | $ 1,221,502 | $ 1,072,149 | $ 851,573 |
Cost and expenses: | |||
Cost of sales (excluding depreciation and amortization) | 953,004 | 831,541 | 658,750 |
Selling, general and administrative | 117,108 | 115,967 | 89,707 |
Restructuring charges | 0 | 39 | 622 |
Depreciation and amortization | 40,109 | 42,732 | 47,229 |
Operating income | 111,281 | 81,870 | 55,265 |
Non-operating (expense) income: | |||
Interest expense | (2,559) | (2,530) | (5,245) |
Other, net | 1,041 | 754 | 280 |
Income before income taxes | 109,763 | 80,094 | 50,300 |
Income tax expense | (21,427) | (23,114) | (11,804) |
Net income | $ 88,336 | $ 56,980 | $ 38,496 |
Earnings Per Share [Abstract] | |||
Basic earnings per common share | $ 2.67 | $ 1.72 | $ 1.18 |
Diluted earnings per common share | $ 2.66 | $ 1.70 | $ 1.17 |
Weighted-average common shares outstanding: | |||
Basic (in shares) | 33,048 | 33,193 | 32,689 |
Diluted (in shares) | 33,205 | 33,495 | 32,821 |
Cash dividends paid per common share (usd per share) | $ 0.32 | $ 0.32 | $ 0.32 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 88,336 | $ 56,980 | $ 38,496 |
Foreign currency translation adjustments (loss) gain | (28,334) | 7,152 | 1,078 |
Change in pension from net unamortized gain (loss) (pretax) | 897 | 5,477 | (376) |
Change in pension from net unamortized gain (loss) tax (expense) benefit | (215) | (1,375) | 91 |
Total other comprehensive (loss) income, net of tax | (27,652) | 11,254 | 793 |
Comprehensive income | $ 60,684 | $ 68,234 | $ 39,289 |
Consolidated Statement of Stock
Consolidated Statement of Stockholders' Equity - USD ($) | Total | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Treasury Stock |
Common stock, shares at Oct. 31, 2019 | 37,370,402 | |||||
Stockholders' equity, value at Oct. 31, 2019 | $ 330,187,000 | $ 374,000 | $ 254,673,000 | $ 185,703,000 | $ (33,817,000) | $ (76,746,000) |
Treasury shares (in shares) at Oct. 31, 2019 | (4,348,613) | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | 38,496,000 | 38,496,000 | ||||
Foreign currency translation adjustment (net of taxes) | 1,078,000 | 1,078,000 | ||||
Change in pension from net unamortized (loss) gain, net of tax benefit (expense) | (285,000) | (285,000) | ||||
Common dividends ($0.32 per share) | (10,534,000) | (10,534,000) | ||||
Stock repurchased during period, shares (in shares) | (450,000) | |||||
Stock repurchased during period, value | (7,233,000) | $ (7,233,000) | ||||
Stock-based compensation activity: | ||||||
Expense related to stock-based compensation | 879,000 | 879,000 | ||||
Stock options exercised | $ 3,625,000 | 66,000 | (242,000) | $ 3,801,000 | ||
Stock options exercised (in shares) | 215,733 | 215,733 | ||||
Restricted stock awards granted | (1,212,000) | 94,000 | $ 1,118,000 | |||
Restricted stock awards granted (in shares) | 63,400 | |||||
Performance share awards vested | (495,000) | $ 495,000 | ||||
Performance share awards vested (in shares) | 28,051 | |||||
Other (in shares) | (74,236) | |||||
Other | $ (454,000) | $ (1,000) | (453,000) | |||
Common stock, shares at Oct. 31, 2020 | 37,296,166 | |||||
Stockholders' equity, value at Oct. 31, 2020 | 355,759,000 | $ 373,000 | 253,458,000 | 213,517,000 | (33,024,000) | $ (78,565,000) |
Treasury shares (in shares) at Oct. 31, 2020 | (4,491,429) | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | 56,980,000 | 56,980,000 | ||||
Foreign currency translation adjustment (net of taxes) | 7,152,000 | 7,152,000 | ||||
Change in pension from net unamortized (loss) gain, net of tax benefit (expense) | 4,102,000 | 4,102,000 | ||||
Common dividends ($0.32 per share) | $ (10,779,000) | (10,779,000) | ||||
Stock repurchased during period, shares (in shares) | (478,311) | (478,311) | ||||
Stock repurchased during period, value | $ (11,182,000) | $ (11,182,000) | ||||
Stock-based compensation activity: | ||||||
Expense related to stock-based compensation | 1,970,000 | 1,970,000 | ||||
Stock options exercised | $ 16,272,000 | 1,073,000 | $ 15,199,000 | |||
Stock options exercised (in shares) | 865,393 | 865,393 | ||||
Restricted stock awards granted | (1,282,000) | $ 1,282,000 | ||||
Restricted stock awards granted (in shares) | 73,300 | |||||
Performance share awards vested | (565,000) | $ (565,000) | ||||
Performance share awards vested (in shares) | 32,322 | |||||
Other (in shares) | (22,656) | |||||
Other | $ (492,000) | (492,000) | ||||
Common stock, shares at Oct. 31, 2021 | 37,273,510 | 37,273,510 | ||||
Stockholders' equity, value at Oct. 31, 2021 | $ 419,782,000 | $ 373,000 | 254,162,000 | 259,718,000 | (21,770,000) | $ (72,701,000) |
Treasury shares (in shares) at Oct. 31, 2021 | (3,998,725) | (3,998,725) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | $ 88,336,000 | 88,336,000 | ||||
Foreign currency translation adjustment (net of taxes) | (28,334,000) | (28,334,000) | ||||
Change in pension from net unamortized (loss) gain, net of tax benefit (expense) | 682,000 | 682,000 | ||||
Common dividends ($0.32 per share) | $ (10,598,000) | (10,598,000) | ||||
Stock repurchased during period, shares (in shares) | (291,000) | (291,000) | ||||
Stock repurchased during period, value | $ (6,600,000) | $ (6,600,000) | ||||
Stock-based compensation activity: | ||||||
Expense related to stock-based compensation | 2,291,000 | 2,291,000 | ||||
Stock options exercised | $ 689,000 | 38,000 | $ 651,000 | |||
Stock options exercised (in shares) | 35,600 | 35,600 | ||||
Restricted stock awards granted | (1,534,000) | $ 1,534,000 | ||||
Restricted stock awards granted (in shares) | 84,400 | |||||
Performance share awards vested | (1,598,000) | $ 87,919 | ||||
Recognition of unrecognized tax benefit | 1,598,000 | |||||
Other (in shares) | (62,454) | |||||
Other | $ (1,413,000) | $ (1,000) | (1,412,000) | |||
Common stock, shares at Oct. 31, 2022 | 37,211,056 | 37,211,056 | ||||
Stockholders' equity, value at Oct. 31, 2022 | $ 464,835,000 | $ 372,000 | $ 251,947,000 | $ 337,456,000 | $ (49,422,000) | $ (75,518,000) |
Treasury shares (in shares) at Oct. 31, 2022 | (4,081,806) | (4,081,806) |
Consolidated Statement of Sto_2
Consolidated Statement of Stockholders' Equity (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2022 | Jul. 31, 2022 | Apr. 30, 2022 | Jan. 31, 2022 | Oct. 31, 2021 | Jul. 31, 2021 | Apr. 30, 2021 | Jan. 31, 2021 | Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Statement of Stockholders' Equity [Abstract] | |||||||||||
Change in pension from net unamortized gain (loss) tax (expense) benefit | $ (215) | $ (1,375) | $ 91 | ||||||||
Cash dividends paid per common share (usd per share) | $ 0.08 | $ 0.08 | $ 0.08 | $ 0.08 | $ 0.08 | $ 0.08 | $ 0.08 | $ 0.08 | $ 0.32 | $ 0.32 | $ 0.32 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flow - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Operating activities: | |||
Net income | $ 88,336 | $ 56,980 | $ 38,496 |
Adjustments to reconcile net income to cash provided by operating activities: | |||
Depreciation and amortization | 40,109 | 42,732 | 47,229 |
Loss on disposition of capital assets | 109 | 3,039 | 0 |
Stock-based compensation | 2,291 | 1,970 | 879 |
Deferred income tax | 2,097 | 1,785 | (189) |
Other, net | 1,905 | 2,126 | 1,689 |
Changes in assets and liabilities: | |||
Decrease (increase) in accounts receivable | 6,945 | (19,017) | (5,766) |
(Increase) decrease in inventory | (32,035) | (31,382) | 6,119 |
(Increase) decrease in other current assets | (970) | (1,817) | 2,896 |
(Decrease) increase in accounts payable | (3,047) | 7,097 | 15,922 |
(Decrease) increase in accrued liabilities | (3,159) | 16,212 | (3,156) |
(Decrease) increase in income taxes payable | (5,192) | (378) | 237 |
Increase (decrease) in deferred pension and postretirement benefits | 77 | (708) | (2,775) |
Increase (decrease) in other long-term liabilities | 305 | 477 | (236) |
Other, net | 194 | (528) | (549) |
Cash provided by operating activities | 97,965 | 78,588 | 100,796 |
Investing activities: | |||
Capital expenditures | (33,121) | (24,008) | (25,726) |
Proceeds from disposition of capital assets | 159 | 5,300 | 502 |
Cash used for investing activities | (32,962) | (18,708) | (25,224) |
Financing activities: | |||
Borrowings under credit facility | 70,500 | 0 | 114,500 |
Repayments of credit facility borrowings | (95,500) | (65,000) | (154,000) |
Debt issuance costs | (1,210) | 0 | 0 |
Repayments of other long-term debt | (1,747) | (680) | (1,027) |
Common stock dividends paid | (10,598) | (10,779) | (10,534) |
Issuance of common stock | 689 | 16,272 | 3,626 |
Payroll tax paid to settle shares forfeited upon vesting of stock | (1,413) | (492) | (454) |
Purchase of treasury stock | (6,600) | (11,182) | (7,233) |
Cash used for financing activities | (45,879) | (71,861) | (55,122) |
Effect of exchange rate changes on cash and cash equivalents | (4,092) | 421 | 303 |
Increase (decrease) in cash and cash equivalents | 15,032 | (11,560) | 20,753 |
Cash and cash equivalents at beginning of period | 40,061 | 51,621 | 30,868 |
Cash and cash equivalents at end of period | $ 55,093 | $ 40,061 | $ 51,621 |
Nature of Operations, Basis of
Nature of Operations, Basis of Presentation and Significant Accounting Policies | 12 Months Ended |
Oct. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Operations, Basis of Presentation and Significant Accounting Policies | Nature of Operations, Basis of Presentation and Significant Accounting Policies Nature of Operations 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: (1) North American Fenestration (NA Fenestration), (2) European Fenestration (EU Fenestration) and (3) North American Cabinet Components (NA Cabinet Components). For additional discussion of our reportable business segments, see Note 16, “Segment Information.” We use low-cost 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. Basis of Presentation and Principles of Consolidation Our consolidated financial statements have been prepared by us in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). We consolidate our wholly-owned subsidiaries and eliminate intercompany sales and transactions. We have no cost or equity investments in companies that are not wholly-owned. In our opinion, these audited financial statements contain all adjustments necessary to fairly present our financial position, results of operations and cash flows for the periods presented. Use of Estimates 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 ongoing basis, including those related to impairment of long lived assets and goodwill, pension and retirement liabilities, contingencies and income taxes. Changes in facts and circumstances may result in revised estimates and actual results may differ from these estimates. A summary of our significant accounting policies consistently applied in the preparation of the accompanying consolidated financial statements follows: Revenue from Contracts with Customers Revenue recognition We recognize revenue that reflects 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 transferred to our customers, and we are 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 products, 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 acc ount for product returns related to general returns and product nonconformance. 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. Pricing and sales i ncentives 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. Shipping and handling cost s 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 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 insulating glass 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 years ended October 31, 2022, 2021, and 2020 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 16, “Segment Information.” Year Ended October 31, 2022 2021 2020 (in thousands) NA Fenestration: United States - fenestration $ 609,572 $ 507,634 $ 427,616 International - fenestration 35,906 34,610 28,585 United States - non-fenestration 29,039 24,534 19,279 International - non-fenestration 12,941 11,554 7,935 $ 687,458 $ 578,332 $ 483,415 EU Fenestration: International - fenestration $ 194,854 $ 199,511 $ 134,432 International - non-fenestration 67,204 52,088 26,622 $ 262,058 $ 251,599 $ 161,054 NA Cabinet Components: United States - fenestration $ 17,696 $ 13,326 $ 11,842 United States - non-fenestration 254,726 230,559 196,479 International - non-fenestration 3,282 2,190 1,778 $ 275,704 $ 246,075 $ 210,099 Unallocated Corporate & Other: Eliminations $ (3,718) $ (3,857) $ (2,995) $ (3,718) $ (3,857) $ (2,995) Net sales $ 1,221,502 $ 1,072,149 $ 851,573 Cash and Cash Equivalents Cash equivalents include all highly liquid investments with an original maturity of three months or less. Such securities with an original maturity which exceeds three months are deemed to be short-term investments. We maintain cash and cash equivalents at several financial institutions, which at times may not be federally insured or may exceed federally insured limits. We have not experienced any losses in such accounts and believe we are not exposed to any significant credit risks on such accounts. Concentration of Credit Risk and Allowance for Credit Losses Certain of our businesses or product lines are largely dependent on a relatively few large customers. Although we believe we have an exte nsive customer base, the loss of one of these large customers or if such customers were to incur a prolonged period of decline in business, our financial condition and results of operations could be adversely affected. For the years ended October 31, 2022 and 2020, one customer provided more than 10% of our consolidated net sales. For the year ended October 31, 2021, no customer provided more than 10% of our consolidated net sales. We have establishe d an allowance for credit losses to estimate the risk of loss associated with our accounts receivable balances. Our policy for determining the allowance is based on factors that affect collectability, including: (a) historical trends of write-offs, recoveries and credit losses; (b) the credit quality of our customers; and (c) projected economic and market conditions. We believe our allowance is adequate to absorb any known or probable lo sses as of October 31, 2022. Different assumptions or changes in economic circumstances could result in changes to the allowance. Business Combinations We apply the acquisition method of accounting for business combinations, which requires us to make use of estimates and judgments to allocate the purchase price paid for acquisitions to the fair value of the assets and liabilities acquired. We account for contingent assets and liabilities at fair value on the acquisition date, and record changes to fair value associated with these asse ts and liabilities as a period cost as incurred. We use established valuation techniques and engage reputable valuation specialists to assist us with these valuations. However, there is a risk that we may not identify all pre-acquisition contingencies or that our estimates may not reflect the actual results when realized. We use a reasonable measurement period to record any adjustment related to the opening balance sheet (generally, less than one year). After the measurement period, changes to the opening balance sheet can result in the recognition of income or expense as period costs. To the extent these items stem from contingencies that existed at the balance sheet date, but are contingent upon the realization of future events, the cost is charged to expense at the time the future event becomes known. Inventory We record inventory at the lower of cost or net realizable value. Inventories are valued using the first-in first-out (FIFO) method. Fixed costs related to excess manufacturing capacity are evaluated and expensed in the period, to ensure that inventory is properly capitalized. Inventory quantities are regularly reviewed and provisions for excess or obsolete inventory are recorded primarily based on our forecast of future demand and our estimates regarding current and future market conditions. Significant unanticipated variances to our forecasts could require a change in the provision for excess or obsolete inventory, resulting in a charge to net income during the period of the change. Long-Lived Assets Property, Plant and Equipment and Intangible Assets with Defined Lives We make judgments and estimates related to the carrying value of property, plant and equipment, intangible assets with defined lives, and long-lived assets, which include determining when to capitalize costs, the depreciation and amortization methods to use and the useful lives of these assets. We evaluate these assets for impairment when there are indicators that the carrying values of these assets might not be recoverable. Such indicators of impairment may include changes in technology, significant market fluctuations, historical losses or loss of a significant customer, or other changes in circumstance that could affect the assets’ ability to generate future cash flows. When we evaluate these assets for impairment, we compare the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset to its carrying value. If the carrying value exceeds the sum of the undiscounted cash flows, and there is no alternative use for the asset, we determine that the asset is impaired. To measure the impairment charge, we compare the carrying amount of the long-lived asset to its fair value, as determined by quoted market prices in active markets, if available, or by discounting the projected future cash flows. This calculation of fair value requires us to develop and employ long-term forecasts of future operating results related to these assets. These forecasts are based on assumptions about demand for our products and future market conditions. Future events and unanticipated changes to these assumptions could require a provision for impairment, resulting in a charge to net income during the period of the change. We monitor relevant circumstances, including industry trends, general economic conditions, and the potential impact that such circumstances might have on the valuation of our identifiable intangible assets with finite lives. Events and changes in circumstance that may cause a triggering event and necessitate such a review include, but are not limited to: a decrease in sales for certain customers, improvements or changes in technology, and/or a decision to discontinue the use of a trademark or trade name, or to allow a patent to lapse. Such events could negatively impact the fair value of our identifiable intangible assets. In such circumstances, we may evaluate the underlying assumptions and estimates made by us in order to assess the appropriate valuation of these identifiable intangible assets and compare to the carrying value of the assets. We may be required to write down these identifiable intangible assets and record a non-cash impairment charge. When we originally value our intangible assets, we use a variety of techniques to establish the carrying value of the assets, including the relief from royalty method, excess current year earnings method and income method. The World Health Organization's (WHO), declaration of COVID-19 as a global pandemic also created significant changes in market conditions throughout 2020 that have continued into 2021. We determined that these conditions were indicators of a triggering event in 2020 which necessitated an evaluation of certain long-term assets used in these businesses for potential impairment. We compared the projected undiscounted cash flows we expected to realize associated with these assets over the remaining useful lives of the primary operating assets to the net book value of the long-term assets, including goodwill, and determined that these assets were not impaired. During the year ended October 31, 2022, our North American vinyl extrusion operations in our NA Fenestration segment experienced lower-than-expected operating results due to the continued impact of inflation and historical customer contracts which prevent us from passing on the full impact of higher costs to our customers. We determined that this condition was an indicator of a triggering event which necessitated an evaluation of certain long-term assets used in this business for potential impairment. We compared the projected undiscounted cash flows we expected to realize associated with these assets over the remaining useful lives of the primary operating assets to the net book value of the long-term assets and determined that these assets were not impaired. Should we be unable to successfully increase prices to offset inflation, it is possible that we could incur an impairment in the future. There were no indicators of triggering events noted for any period in the year ended October 31, 2021. Therefore, we did not record an impairment charge related to property, plant and equipment or intangible assets with defined lives during the years ended October 31, 2022, 2021 and 2020. Software development costs, including costs incurred to purchase third-party software, are capitalized when we have determined that the technology is capable of meeting our performance requirements, and we have authorized funding for the project. We cease capitalization of software costs when the software is substantially complete and is ready for its intended use. The software is then amortized over its estimated useful life. When events or circumstances indicate the carrying value of internal use software might not be recoverable, we assess the recoverability of these assets by comparing the carrying value of the asset to the undiscounted future cash flows expected to be generated from the asset’s use, consistent with the methodology to test other property, plant and equipment for impairment. Property, plant and equipment is stated at cost and is depreciated using the straight-line method over the estimated useful lives of the assets. We capitalize betterments which extend the useful lives or significantly improve the operational efficiency of assets. We expense repair and maintenance costs as incurred. The estimated useful lives of our primary asset categories at October 31, 2022 were as follows: Useful Life (in Years) Land improvements 7 to 25 Buildings 25 to 40 Building improvements 5 to 20 Machinery and equipment 2 to 15 Leasehold improvements are depreciated over the shorter of their estimated useful lives or the term of the lease. Goodwill We use the acquisition method to account for business combinations and, to the extent that the purchase price exceeds the fair value of the net assets acquired, we record goodwill. In accordance with U.S. GAAP, we are required to evaluate our goodwill at least annually. We perform our annual goodwill assessment as of August 31, or more frequently if indicators of impairment exist. Qualitative factors that indicate impairment could include, but are not limited to, (i) macroeconomic conditions, (ii) industry and market considerations, (iii) cost factors, (iv) overall financial performance of the reporting unit, and (v) other relevant entity-specific events. The first step in our annual goodwill assessment is to perform the optional qualitative assessment allowed by ASC Topic 350 “Intangibles - Goodwill and Other” (ASC 350). In our qualitative assessment, we evaluate relevant events or circumstances to determine whether it is more likely than not (i.e., greater than 50%) that the fair value of a reporting unit is less than its carrying amount. If we determine that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, ASC 350 requires us to compare the fair value of such reporting unit to its carrying value including goodwill. To determine the fair value of our reporting units, we use multiple valuation techniques including a discounted cash flow analysis, using the applicable weighted average cost of capital, in combination with a market approach that uses market multiples and a selection of guideline public companies. This test requires us to make assumptions about the future growth of our business and the market in general, as well as other variables such as the level of investment in capital expenditure, growth in working capital requirements and the terminal or residual value of our reporting units beyond the periods of estimated annual cash flows. We use a third-party valuation firm to assist us with this analysis. If the fair value of each reporting unit exceeds its carrying value, no action is required. Otherwise, an impairment loss is recorded to the extent that the carrying amount of the reporting unit including goodwill exceeds the fair value of that reporting unit. We believe the estimates and assumptions used in our impairment assessment are reasonable based on available market information, but variations in any of the assumptions could result in materially different calculations of fair value and determinations of whether or not an impairment is indicated during current or future periods. At our annual testing date, August 31, 2022, we had five reporting units with goodwill balances: two reporting units included in our NA Fenestration operating segment, two reporting units included in our EU Fenestration operating segment, and one reporting unit included in our NA Cabinet Components operating segment. We performed a qualitative assessment of one of the reporting units in the NA Fenestration segment and two of the reporting units in the EU Fenestration segment. This review included an analysis of historical goodwill test results, operating results relative to forecast, projected results over the next five years, and other measures and concluded that there were no indicators of potential impairment associated with these reporting units. Therefore, no additional testing was deemed necessary for these three reporting units. Also, at our annual testing date, we performed a quantitative assessment of the reporting unit in our NA Cabinet Components segment primarily due to the impairment of goodwill during the second and fourth quarters of 2019 and the history of a narrow margin of fair value above carrying value in quantitative assessments performed in prior years. We determined that the fair value of this reporting unit exceeded their carrying values by approximat ely 12.0%. We also elected to update the quantitative assessment of the other reportable unit in the NA Fenestration operating segment. We determined that the fair value of this reporting unit exceeded their carrying values by approximat ely 384.9%. We concluded that no impairment was necessary. 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 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 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 assumed sublet in the current period. For other costs directly related to the restructuring effort, such as equipment moving costs, we expense in the period incurred. Insurance We manage our exposure to losses for workers’ compensation, group medical, property, casualty and other insurance claims through a combination of self-insurance retentions and insurance coverage with third-party carriers. We record undiscounted liabilities associated with our portion of these exposures, which we estimate by considering various factors such as our historical claims experience, severity factors and estimated claims incurred but not reported, for which we have developed loss development factors, which are estimates as to how claims will develop over time until closed. While we consider a number of factors in preparing the estimates, sensitive assumptions using significant judgment are made in determining the amounts that are accrued in the financial statements. Actual claims could differ significantly from these estimated liabilities, depending on future claims experience. We do not record insurance recoveries until any contingencies relating to the claim have been resolved. Retirement Plans We sponsor a defined benefit pension plan and an unfunded postretirement plan that provides health care and life insurance benefits for a limited pool of eligible retirees and dependents. To measure our liabilities associated with these plans, we make assumptions related to future events, including expected return on plan assets, rate of compensation increases, and healthcare cost trend rates. The discount rate reflects the rate at which benefits could be effectively settled on the measurement date. We determine our discount rate using a FTSE Above Median pension discount curve whereby target yields are developed from bonds across a range of maturity points, and a curve is fitted to those targets. Spot rates (zero coupon bond yields) are developed from the curve and used to discount benefit payments associated with each future year. Actual pension plan asset investment performance, as well as other economic experience such as discount rate and demographic experience, will either reduce or increase unamortized pension losses at the end of any fiscal year, which ultimately affects future pension costs. Warranty Obligations We accrue warranty obligations when we recognize revenue for certain products. Our provision for warranty obligations is based on historical costs incurred for such obligations and is adjusted, where appropriate, based on current conditions and factors. Our ability to estimate our warranty obligations is subject to significant uncertainties, including changes in product design and our overall product sales mix. Income Taxes We record the estimated future tax effects of temporary differences between the tax basis of assets and liabilities and the amounts reported in our consolidated balance sheets, as well as net operating losses and tax credit carry forwards. We evaluate the carrying value of the net deferred tax assets and determine whether we will be able to generate sufficient future taxable income to realize our deferred tax assets. We perform this review for recoverability on a jurisdictional basis, whereby we consider both positive and negative evidence related to the likelihood of realization of the deferred tax assets. The weight given to the positive and negative evidence is commensurate with the extent to which the evidence can be objectively verified. Cumulative losses in recent years is a significant piece of negative evidence that is difficult to overcome in determining that a valuation allowance is not needed against deferred tax assets. Thus, it is generally difficult for positive evidence regarding projected future taxable income exclusive of reversing taxable temporary differences to outweigh objective negative evidence of recent financial reporting losses. We believe we will fully realize our deferred tax assets, net of a recorded valuation allowance. We project future taxable income using the same forecasts used to test long-lived assets and intangibles for impairment, scheduling out the future reversal of existing taxable temporary differences and reviewing our most recent financial operations. In the event the estimates and assumptions indicate we will not generate sufficient future taxable income to realize our deferred tax assets, we record a valuation allowance against a portion of our deferred tax assets. We evaluate our ongoing tax positions to determine if it is more-likely-than-not we will be successful in defending such positions if challenged by taxing authorities. To the extent that our tax positions do not meet the more-likely-than-not criteria, we record a liability for uncertain tax positions. We have recorded a liability for uncertain tax positions which stem from certain federal and state tax items related to the interpretation of tax laws and regulations. We continue to evaluate our positions regarding various state tax interpretations at each reporting date, until the applicable statute of limitations lapse. On August 16, 2022, the Inflation Reduction Act of 2022 was enacted into U.S. law. We are continuing to evaluate the regulation but do not anticipate a material impact to our consolidated financial statements. Derivative Instruments We have historically used financial and commodity-based derivative contracts to manage our exposure to fluctuations in foreign currency exchange rates and aluminum prices. All derivatives are measured at fair value on a recurring basis. We have not designated the derivative instruments we use as cash flow hedges under ASC Topic 815 “Derivatives and Hedging” (ASC 815). Therefore, all gains and losses, both realized and unrealized, are recognized in the consolidated statements of income (loss) in the period of the change as the underlying assets and liabilities are marked-to-market. We do not enter into derivative instruments for speculative or trading purposes. As such, these instruments are considered economic hedges, and are reflected in the operating activities section of the consolidated statements of cash flow. Foreign Currency Translation Our consolidated financial statements are presented in our reporting currency, the United States Dollar. Our German and U.K. operations are measured using the local currency as the functional currency. The assets and liabilities of our foreign operations which are denominated in other currencies are translated to United States Dollars using the prevailing exchange rates as of the balance sheet date. Revenues and expenses are translated at the average exchange rates for the applicable period. The resulting translation adjustments are recorded as a component of accumulated other comprehensive loss on the consolidated balance sheets. Occasionally, we enter into transactions that are denominated in currencies other than our functional currency. At each balance sheet date, we translate these asset or liability accounts to our functional currency and record unrealized transaction gains or losses. When these assets or liabilities settle, we record realized transaction gains or losses. These realized and unrealized gains or losses are included in the accompanying consolidated statements of income under the caption, “Other, net.” Stock–Based Compensation We have issued stock-based compensation in the form of stock options to directors, employees and officers, and non-vested restricted stock awards to certain key employees and officers. We apply the provisions of ASC Topic 718 “Compensation - Stock Compensation” (ASC 718), to determine the fair value of stock option awards on the date of grant using the Black-Scholes valuation model. We recognize the fair value as compensation expense on a straight-line basis over the requisite service period of the award based on awards ultimately expected to vest. Stock options granted to directors vest immediately while the stock options granted to our employees and officers typically vest ratably over a three-year period with service and continued employment as the vesting conditions. For new option grants to retirement-eligible employees, we recognize expense and vest immediately upon grant, consistent with the retirement vesting acceleration provisions of these grants. For employees near retirement age, we amortize such grants over the period from the grant date to the retirement-eligibility date if such period is shorter than the standard vesting schedule. For grants of non-vested restricted stock, we calculate the compensation expense at the grant date as the number of shares granted multiplied by the closing stock price of our common stock on the date of grant. This expense is recognized ratably over the vesting period. Our non-vested restricted stock grants to officers and employees cliff vest over a three-year period with service and continued employment as the only vesting criteria. Our fair value determination of stock-based payment awards on the date of grant using an option-pricing model is affected by our stock price as well as assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to, our expected stock price volatility over the term of the awards, actual and projected employee stock option exercise behavior over the expected term, our dividend rate, risk-free rate and expectation with regards to forfeitures. Option-pricing models were developed for use in estimating the value of traded options that have no vesting or hedging restrictions and are fully transferable. Because our employee stock options have certain characteristics that are significantly different from traded options, and because changes in the subjective assumptions can materially affect the estimated value, the valuation models may not provide an accurate measure of the fair value of our employee stock options. Accordingly, that value may not be indicative of the fair value observed in a willing buyer/willing seller market transaction. We have granted other awards which are linked to the per |
Receivables & Allowance
Receivables & Allowance | 12 Months Ended |
Oct. 31, 2022 | |
Receivables [Abstract] | |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Credit Losses Accounts receivable consisted of the following as of October 31, 2022 and 2021 (in thousands): October 31, 2022 2021 Trade receivables $ 95,851 $ 107,725 Other 456 924 Total 96,307 108,649 Less: Allowance for credit losses 289 340 Accounts receivable, net $ 96,018 $ 108,309 The changes in our allowance for credit losses were as follows (in thousands): Year Ended October 31, 2022 2021 2020 Beginning balance as of November 1, 2021, 2020 and 2019 $ 340 $ 161 $ 393 Current period provision for expected credit 314 267 262 Amounts written off (299) (88) (494) Recoveries 10 — — Foreign currency translation adjustments (76) — — Balance as of October 31, 2022, 2021 and 2020 $ 289 $ 340 $ 161 |
Inventories
Inventories | 12 Months Ended |
Oct. 31, 2022 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consisted of the following at October 31, 2022 and 2021 (in thousands): October 31, 2022 2021 Raw materials $ 68,455 $ 49,867 Finished goods and work in process 54,013 43,499 Supplies and other 1,551 2,099 Total 124,019 95,465 Less: Inventory reserves 3,129 2,936 Inventories, net $ 120,890 $ 92,529 The changes in our inventory reserve accounts were as follows (in thousands): Year Ended October 31, 2022 2021 2020 Beginning balance as of November 1, 2021, 2020 and 2019 $ 2,936 $ 6,484 $ 3,790 Charged to cost of sales 494 (568) 2,713 Write-offs (133) (3,060) — Other (168) 80 (19) Balance as of October 31, 2022, 2021 and 2020 $ 3,129 $ 2,936 $ 6,484 |
Property, Plant & Equipment
Property, Plant & Equipment | 12 Months Ended |
Oct. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment Disclosure | Property, Plant and Equipment Property, plant and equipment consisted of the following at October 31, 2022 and 2021 (in thousands): October 31, 2022 2021 Land and land improvements $ 10,702 $ 10,285 Buildings and building improvements 105,696 101,740 Machinery and equipment 384,023 386,996 Construction in progress 28,507 16,102 Property, plant and equipment, gross 528,928 515,123 Less: Accumulated depreciation 348,528 336,493 Property, plant and equipment, net $ 180,400 $ 178,630 Depreciation expense for the years ended October 31, 2022, 2021, and 2020 was $26.9 million , $28.8 million and $31.8 million, respectively. If there are indicators of potential impairment, we evaluate our property, plant and equipment for recoverability over the remaining useful lives of the assets. We did not incur impairment losses associated with these assets for the years ended October 31, 2022, 2021, and 2020. See further discussion at Note 1, “Nature of Operations, Basis of Presentation and Significant Accounting Policies - Long-Lived Assets - Property, Plant and Equipment and Intangible Assets with Defined Lives.” |
Leases
Leases | 12 Months Ended |
Oct. 31, 2022 | |
Leases [Abstract] | |
Leases | Leases 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 one 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 common area maintenance 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 (calculated as the present value of lease payments over the term of the lease) 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 and we determined there have been no triggering events for impairment. 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 October 31, 2022 and 2021 (in thousands): October 31, Leases Classification 2022 2021 Assets Operating lease assets Operating lease right-of-use assets $ 56,000 $ 52,708 Finance lease assets Property, plant and equipment (less accumulated depreciation of $3,726 and $2,300) 22,003 16,921 Total lease assets $ 78,003 $ 69,629 Liabilities Current Operating Current operating lease liabilities $ 7,727 $ 8,196 Finance Current maturities of long-term debt 1,336 1,114 Noncurrent Operating Noncurrent operating lease liabilities 49,286 45,367 Finance Long-term debt 17,816 14,335 Total lease liabilities $ 76,165 $ 69,012 The table below presents the components of lease costs for the year ended October 31, 2022 and 2021 (in thousands): Year Ended October 31, 2022 2021 Operating lease cost $ 9,934 $ 10,125 Finance lease cost Amortization of leased assets 1,332 1,165 Interest on lease liabilities 583 561 Variable lease costs 977 983 Total lease cost $ 12,826 $ 12,834 The table below presents supplemental cash flow information related to leases for the year ended October 31, 2022 and 2021 (in thousands): Year Ended October 31, 2022 2021 Cash paid for amounts included in the measurement of lease liabilities: Finance leases - financing cash flows $ 1,162 $ 1,003 Finance leases - operating cash flows $ 583 $ 561 Operating leases - operating cash flows $ 9,955 $ 9,621 Right-of-use assets obtained in exchange for lease liabilities: Operating leases $ 13,872 $ 8,737 Finance leases $ 6,467 $ 469 The table below presents the weighted average remaining lease terms and weighted average discount rates for the Company's leases as of October 31, 2022 and 2021: October 31, 2022 2021 Weighted average remaining lease term (in years) Operating leases 10.8 7.7 Financing leases 13.7 15.1 Weighted average discount rate Operating leases 3.84 % 3.23 % Financing leases 3.78 % 3.72 % The table below presents the maturity of the lease liabilities as of October 31, 2022 (in thousands): Operating Leases Finance Leases 2023 $ 9,668 $ 2,027 2024 8,920 1,980 2025 7,213 1,922 2026 6,229 1,807 2027 5,589 1,709 Thereafter 33,769 15,123 Total lease payments 71,388 24,568 Less: present value discount 14,378 5,418 Total lease liabilities $ 57,010 $ 19,150 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Oct. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Acquired Intangible Assets | Goodwill and Intangible Assets Goodwill The change in the carrying amount of goodwill for the years ended October 31, 2022 and 2021 was as follows (in thousands): Year Ended October 31, 2022 2021 Beginning balance as of November 1, 2021 and 2020 $ 149,205 $ 146,154 Foreign currency translation adjustment (11,350) 3,051 Balance as of October 31, 2022 and 2021 $ 137,855 $ 149,205 At our annual testing date, August 31, 2022, we ha d five reporting units with goodwill balances. Two of these units were included in our NA Fenestration segment and had goodwill balances of $35.9 million and $2.8 million, two units were included in our EU Fenestration segment with goodwill balances of $45.1 million and $14.9 million, and our NA Cabinet Components segment had one unit with a goodwill balance of $39.2 million. The details of the results of our goodwill assessments during the year ended October 31, 2022 are more fully described at Note 1, “Nature of Operations, Basis of Presentation and Significant Accounting Policies - Long-Lived Assets - Goodwill.” For a summary of the change in the carrying amount of goodwill by segment, see Note 16, “Segment Information.” Identifiable Intangible Assets Amortizable intangible assets consisted of the following as of October 31, 2022 and 2021 (in thousands): October 31, 2022 October 31, 2022 October 31, 2021 Remaining Weighted Average Useful Life Gross Carrying Accumulated Gross Carrying Accumulated Customer relationships 8 years $ 139,607 $ 88,646 $ 146,207 $ 81,086 Trademarks and trade names 7 years 54,389 40,610 56,437 39,589 Patents and other technology 5 years 22,390 22,095 22,525 22,084 Total $ 216,386 $ 151,351 $ 225,169 $ 142,759 We do not estimate a residual value associated with these intangible assets. See additional disclosure at Note 1, "Nature of Operations, Basis of Presentation and Significant Accounting Policies - Restructuring." During the years ended October 31, 2022 and 2021, we retired fully amortized identifiable intangible assets of zero and $9.9 million, respectively, related to customer relationships. The aggregate amortization expense associated with identifiable intangible assets for the years ended October 31, 2022, 2021, and 2020 was $11.9 million , $12.8 million and $14.3 million, respectively. Estimated remaining amortization expense, assuming current intangible balances and no new acquisitions, for future fiscal years as of October 31, 2022 (in thousands): Estimated 2023 $ 10,908 2024 10,156 2025 8,930 2026 8,855 2027 8,856 Thereafter 17,330 Total $ 65,035 We did not incur impairment losses related to our identifiable intangible assets during the years ended October 31, 2022, 2021, and 2020. |
Accrued Liabilities
Accrued Liabilities | 12 Months Ended |
Oct. 31, 2022 | |
Accrued Liabilities [Abstract] | |
Accrued Liabilities | Accrued Liabilities Accrued liabilities consisted of the following at October 31, 2022 and 2021 (in thousands): October 31, 2022 2021 Payroll, payroll taxes and employee benefits $ 23,878 $ 30,039 Accrued insurance and workers compensation 7,232 6,340 Sales allowances 7,456 8,590 Deferred compensation (current portion) — 395 Deferred revenue 792 627 Warranties 13 77 Audit, legal, and other professional fees 3,136 1,886 Accrued taxes 2,864 3,258 Other 6,743 4,944 Accrued liabilities $ 52,114 $ 56,156 |
Debt and Capital Lease Obligati
Debt and Capital Lease Obligations | 12 Months Ended |
Oct. 31, 2022 | |
Debt Disclosure [Abstract] | |
Debt and Capital Lease Obligations | Debt Long-term debt consisted of the following at October 31, 2022 and 2021 (in thousands): October 31, 2022 2021 Revolving Credit Facility $ 13,000 $ 38,000 Finance lease obligations and other 19,202 15,537 Unamortized deferred financing fees (1,528) (597) Total debt 30,674 52,940 Less: Current maturities of long-term debt 1,046 846 Long-term debt $ 29,628 $ 52,094 Revolving Credit Facility On July 6, 2022, we entered into our Second Amended and Restated Credit Agreement (the “Credit Facility”) with Wells Fargo Securities, LLC, as Agent, Swingline Lender and Issuing Lender, and BofA Securities, Inc. serving as Syndication Agent. We capitalized $1.2 million of deferred financing fees related to the Credit Facility during the year ended October 31, 2022 . This $325.0 million revolving credit facility has a five Interest payments for the Credit Facility are calculated, at our election and depending upon the Consolidated Net Leverage Ratio, at a Base Rate plus an applicable margin or at the same rate as Risk-Free Rate (“RFR”) Loans for domestic borrowings or Eurocurrency Rate Loans plus an applicable margin. In addition, we are subject to commitment fees for the unused portion of the Credit Facility. As of October 31, 2022, the applicable rate was RFR + 1.25%. The applicable margin and commitment fees are outlined in the following table: Pricing Level Consolidated Leverage Ratio Commitment Fee Eurocurrency Rate Loans and RFR Loans Base Rate Loans I Less than or equal to 1.50 to 1.00 0.150% 1.25% 0.25% II Greater than 1.50 to 1.00, but less than or equal to 2.25 to 1.00 0.175% 1.50% 0.50% III Greater than 2.25 to 1.00, but less than or equal to 3.00 to 1.00 0.200% 1.75% 0.75% IV Greater than 3.00 to 1.00 0.250% 2.00% 1.00% In the event of default, outstanding borrowings 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 provides for incremental revolving credit commitments for a minimum principal amount of $10.0 million, up to an aggregate amount of $150.0 million or 100% of Consolidated EBITDA, subject to the lender's discretion to elect or decline the incremental increase. We can also borrow up to the lesser of $15.0 million or the revolving credit commitment, as defined, under a Swingline feature of the Credit Agreement. 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 3.00 to 1.00, and (2) Consolidated Net Leverage Ratio requirement whereby the Consolidated Net Leverage Ratio, as defined, must 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 $25.0 million per year) and other transactions as further defined in the Credit Facility. Some of these limitations, however, do not take effect so long as total leverage is less than or equal to 2.75 to 1.00 and available liquidity exceeds $25.0 million. Substantially all of our domestic assets, with the exception of real property were used as collateral for the Credit Agreement. As of October 31, 2022, we had $13.0 million of borrowings outstanding under the Credit Facility (reduced by unamortized debt issuance costs of $1.5 million), $5.0 million of outstanding letters of credit and $19.2 million outstanding under finance leases. We had $307.0 million available for use under the Credit Facility at October 31, 2022. The borrowings outstanding as of October 31, 2022 under the Credit Facility accrue inter est at 5.08% per annum, and our weighted average borrowing rate for borrowings outstanding during the years ended October 31, 2022 and 2021 was 2.16% and 1.42%, respectively. We were in compliance with our debt covenants as of October 31, 2022. We maintain certain finance lease obligations related to equipment purchases, vehicles, and warehouse space. Refer to Note 5 “Leases” for further information regarding our finance leases. The table below presents the scheduled maturity dates of our long-term debt outstanding (excluding deferred financing fees of $1.5 million) at October 31, 2022 (in thousands): Revolving Credit Facility Finance Leases and Other Obligations Aggregate Maturities 2023 $ — $ 2,065 $ 2,065 2024 — 1,992 1,992 2025 — 1,922 1,922 2026 — 1,807 1,807 2027 13,000 1,709 14,709 Thereafter — 15,125 15,125 Total debt payments 13,000 24,620 37,620 Less: present value discount of finance leases — (5,418) (5,418) Total $ 13,000 $ 19,202 $ 32,202 |
Retirement Plans
Retirement Plans | 12 Months Ended |
Oct. 31, 2022 | |
Retirement Benefits [Abstract] | |
Retirement Plans | Retirement Plans We have a number of retirement plans covering substantially all employees. We provide both defined benefit and defined contribution plans. In general, an employee’s coverage for retirement benefits depends on the location of employment. Defined Benefit Plan Our non-contributory, single employer defined benefit pension plan covers certain of our employees in the U.S. 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 freezing the plan on January 1, 2020, we remeasured the pension assets and obligations for the pension plan, which resulted in a decrease to our projected benefit obligation and a corresponding net actuarial gain that was recorded in accumulated other comprehensive income. During the three months ended October 31, 2022, we notified participants that our pension plan will be terminated effective November 1, 2022, with final settlement expected to occur in fiscal 2024. Until such time that the termination is complete, the participants will receive an interest related credit on their respective balance equivalent to the prevailing 30-year Treasury rate. The majority of our pension plan participants have their benefit determined pursuant to the cash balance formula. For the remaining participants, the benefit formula is a traditional formula for retirement benefits, whereby the plan pays benefits to employees upon retirement, using a formula which considers years of service and pensionable compensation prior to retirement. The Medicare Prescription Drug, Improvement and Modernization Act of 2003 was signed into law on December 8, 2003. This Act introduces a Medicare prescription-drug benefit beginning in 2006 as well as a federal subsidy to sponsors of retiree health care plans that provide a benefit at least “actuarially equivalent” to the Medicare benefit. We concluded that our plans are at least “actuarially equivalent” to the Medicare benefit. For those who are otherwise eligible for the subsidy, we have not included this subsidy per the Act in our benefit calculations. The impact to net periodic benefit cost and to benefits paid did not have a material impact on the consolidated financial statements. Funded Status and Net periodic Benefit Cost The changes in benefit obligation and plan assets, and our funded status (reported in deferred pension and postretirement benefits on the consolidated balance sheets) were as follows (in thousands): October 31, Change in Benefit Obligation: 2022 2021 Beginning balance as of November 1, 2021 and 2020 $ 42,379 $ 44,825 Service cost 860 850 Interest cost 806 756 Actuarial loss (6,944) (849) Benefits paid (349) (359) Administrative expenses (604) (732) Settlements (3,619) (2,112) Projected benefit obligation at October 31, 2022 and 2021 $ 32,529 $ 42,379 Change in Plan Assets: Beginning balance as of November 1, 2021 and 2020 $ 37,642 $ 34,120 Actual return on plan assets (4,458) 6,225 Employer contributions — 500 Benefits paid (349) (359) Administrative expenses (604) (732) Settlements (3,619) (2,112) Fair value of plan assets at October 31, 2022 and 2021 $ 28,612 $ 37,642 Noncurrent liability - Funded Status $ (3,917) $ (4,737) As of October 31, 2022 and 2021, included in our accumulated comprehensive loss was a net actuarial loss of $3.6 million and $4.5 million, respectively. There were no net prior service costs or transition obligations for the years ended October 31, 2022 and 2021. As of October 31, 2022 and 2021, the accumulated benefit obligation was $32.5 million and $42.4 million, respectively. The accumulated benefit obligation is the present value of pension benefits (whether vested or unvested) attributed to employee service rendered before the measurement date, and based on employee service and compensation prior to that date. The accumulated benefit obligation differs from the projected benefit obligation in that it includes no assumption about future compensation levels. The net periodic benefit cost for the years ended October 31, 2022, 2021 and 2020, was as follows (in thousands): Year Ended October 31, 2022 2021 2020 Service cost $ 860 $ 850 $ 1,262 Interest cost 806 756 1,139 Expected return on plan assets (1,991) (1,960) (2,006) Amortization of net loss 6 143 162 Settlements 396 222 462 Net periodic benefit cost $ 77 $ 11 $ 1,019 The changes in plan assets and projected benefit obligations which were recognized in our other comprehensive loss for the years ended October 31, 2022, 2021 and 2020 were as follows (in thousands): Year Ended October 31, 2022 2021 2020 Net (gain) loss arising during the period $ (495) $ (5,112) $ 2,141 Less: Amortization of net loss 6 143 162 Less: Curtailments — — 1,141 Less: Settlements 396 222 462 Total recognized in other comprehensive (income) loss $ (897) $ (5,477) $ 376 Measurement Date and Assumptions We generally determine our actuarial assumptions on an annual basis, with a measurement date of October 31. The following table presents our assumptions for pension benefit calculations for the years ended October 31, 2022, 2021 and 2020: For the Year Ended October 31, 2022 2021 2020 2022 2021 2020 Weighted Average Assumptions: Benefit Obligation Net Periodic Benefit Cost Discount rate 5.36% 2.77% 3.22% 2.77% 2.60% 3.10% Rate of compensation increase —% —% —% —% —% —% Expected return on plan assets n/a n/a n/a 5.50% 6.00% 6.50% The discount rate was used to calculate the present value of the projected benefit obligation for pension benefits. The rate reflects the amount at which benefits could be effectively settled on the measurement date. We used the FTSE Above Median Model whereby target yields are developed from bonds across a range of maturity points, and a curve is fitted to those targets. Spot rates (zero coupon bond yields) are developed from the curve and used to discount benefit payments associated with each future year. This model assumes spot rates will remain level beyond the 30-year point. We determine the present value of plan benefits by applying the discount rates to projected benefit cash flows. The expected return on plan assets was used to determine net periodic pension expense. The rate of return assumptions were based on projected long-term market returns for the various asset classes in which the plans were invested, weighted by the target asset allocations. We review the return assumption at least annually. The rate of compensation increase represents the long-term assumption for expected increases in salaries. Plan Assets The following tables provide our target allocation for the year ended October 31, 2022, as well as the actual asset allocation by asset category and fair value measurements as of October 31, 2022 and 2021: Target Allocation Actual Allocation October 31, 2022 October 31, 2022 October 31, 2021 Equity securities — % — % 51.0 % Fixed income 100.0 % 100.0 % 49.0 % Fair Value Measurements at October 31, 2022 October 31, 2021 (In thousands) Money market fund $ 22,508 $ 300 Large capitalization — 8,231 Small capitalization — 1,493 International equity — 6,992 Other — 2,236 Equity securities $ — $ 18,952 High-quality core bond 4,980 13,787 High-quality government bond 547 2,301 High-yield bond 577 2,302 Fixed income $ 6,104 $ 18,390 Total securities (1) $ 28,612 $ 37,642 (1) Quoted prices in active markets for identical assets (Level 1). Inputs and valuation techniques used to measure the fair value of plan assets vary according to the type of security being valued. All of the equity and debt securities held directly by the plans were actively traded and fair values were determined based on quoted market prices. Our investment objective for defined benefit plan assets is to meet the plans’ benefit obligations, while minimizing the potential for future required plan contributions. As steps were initiated to implement the termination of the defined benefit plan, the investments were transitioned to more liquid assets in order to reflect the upcoming settlement charges which will be incurred upon finalization of the termination plan. Expected Benefit Payments and Funding Our pension funding policy is to make the minimum annual contributions required pursuant to the plan. For the fiscal years ended October 31, 2022, 2021 and 2020, we made total pension contributio ns of zero, $0.5 million and $3.7 million, respectively. During fiscal year 2024, we expect to make a contribution which will fully fund the remaining liability and complete the pension plan termination process. This expected contribution will be dependent on many variables, including the market value of the assets compared to the obligation, as well as other market or regulatory conditions. Accordingly, actual funding amounts and the timing of such funding may differ from current estimates. The following table presents the total benefit payments expected to be paid to participants by year, which includes payments funded from our assets, as well as payments paid from the plan for the year ended October 31, (in thousands): Pension Benefits 2023 $ 22,880 2024 729 2025 770 2026 750 2027 704 2028 - 2032 3,415 Total $ 29,248 Defined Contribution Plan We also sponsor two defined contribution plans into which we and our employees make contributions. As of January 1, 2020, we match 100% up to the first 5% of employee annual salary deferrals under our plan for all employees excluding NA Cabinet Components participants, who receive a 100% match up to 4% of employee annual salary deferrals. Between January 1, 2018 and January 1, 2020, we matched 50% up to the first 5% of employee salary deferrals. We do not offer our common stock as a direct investment option under these plans. For the years ended October 31, 2022, 2021 and 2020, we contributed approximately $6.8 million , $6.3 million and $4.8 million for these plans, respectively. Other Plans We have supplemental benefit plans covering certain executive officers and a non-qualified deferred compensation plan covering members of the Board of Directors and certain key employees. Our liability under the supplemental benefit plan was approximately $1.9 million and $2.9 million as of October 31, 2022 and 2021, and our liability under the deferred compensation plan was approximately $3.3 million a |
Income Taxes
Income Taxes | 12 Months Ended |
Oct. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The provision or benefit for income taxes includes U.S. federal income taxes (determined on a consolidated return basis), foreign income taxes and state income taxes. We provide for income taxes on taxable income at the applicable statutory rates. The following table summarizes the components of income tax expense for the years ended October 31, 2022, 2021 and 2020 (in thousands): Year Ended October 31, 2022 2021 2020 Current Federal $ 11,553 $ 10,993 $ 6,043 State and local 740 3,447 1,505 Non-United States 7,037 6,889 4,445 Total current 19,330 21,329 11,993 Deferred Federal 2,127 (842) (64) State and local (229) (277) (315) Non-United States 199 2,904 190 Total deferred 2,097 1,785 (189) Total income tax expense $ 21,427 $ 23,114 $ 11,804 For financial reporting purposes, income before income taxes for the years ended October 31, 2022, 2021 and 2020 includes the following components (in thousands): Year Ended October 31, 2022 2021 2020 Domestic $ 64,850 $ 36,879 $ 26,229 Foreign 44,913 43,215 24,071 Total income before income taxes $ 109,763 $ 80,094 $ 50,300 The following table reconciles our effective income tax rate to the federal statutory rate for the years ended October 31, 2022, 2021 and 2020: Year Ended October 31, 2022 2021 2020 United States tax at statutory rate 21.0 % 21.0 % 21.0 % State and local income tax 0.4 % 3.1 % 1.7 % Non-United States income tax (0.8) % 2.3 % 1.2 % U.K. patent box benefit (1.2) % (1.4) % (2.0) % U.S. income tax credits (3.2) % (4.2) % (2.3) % Net U.S. tax on non-United States earnings 3.2 % 4.2 % 2.5 % Non-cash compensation (1.7) % 1.9 % (0.3) % Other 1.8 % 2.0 % 1.7 % Effective tax rate 19.5 % 28.9 % 23.5 % Our earnings from our foreign subsidiaries are not subject to significant withholding taxes upon remittances to the U.S.. As a result, we do not anticipate any significant future tax impacts from any potential repatriation of previously unremitted foreign earnings. The amount of undistributed foreign earnings from international operations as of the years ended October 31, 2022 and 2021, respectively, was $19.8 million and $15.1 million. Significant components of our net deferred tax liabilities and assets were as follows (in thousands): October 31, 2022 2021 Deferred tax assets: Employee benefit obligations $ 8,046 $ 7,591 Accrued liabilities and reserves 1,430 1,425 Pension and other benefit obligations 1,426 1,934 Inventory 1,409 894 Loss and tax credit carry forwards 1,589 1,857 Other — 107 Total gross deferred tax assets 13,900 13,808 Less: Valuation allowance 534 1,174 Total deferred tax assets, net of valuation allowance 13,366 12,634 Deferred tax liabilities: Property, plant and equipment 15,467 11,187 Goodwill and intangibles 20,162 23,412 Other 14 — Total deferred tax liabilities 35,643 34,599 Net deferred tax liabilities $ 22,277 $ 21,965 At October 31, 2022, state operating loss carry forwards totaled $31.3 million . The majority of these losses begin to expire in 2033. We evaluate tax benefits of operating losses and tax credit carry forwards on an ongoing basis, including a review of historical and projected future operating results, the eligible carry forward period and other circumstances. We have recorded a valuation allowance for certain state net operating losses as of October 31, 2022 and 2021, totaling $0.5 million and $1.2 million, respectively. During the year ended October 31, 2022, we recorded a net $0.7 million decrease in our state va luation allowances. The valuation allowances can be affected in future periods by changes to tax laws, changes to statutory tax rates, and changes in estimates of future taxable income. To fully realize these net deferred tax assets, we will need to generate sufficient future taxable income in the countries where these tax attributes exist during the periods in which the attributes can be utilized. As of each reporting date, management considers the weight of all evidence, both positive and negative, to determine if a valuation allowance is necessary for each jurisdiction’s net deferred tax assets. We place greater weight on historical evidence over future predictions of our ability to utilize net deferred tax assets. We consider future reversals of existing taxable temporary differences, future taxable income exclusive of reversing temporary differences, and taxable income in prior carryback year(s) if carryback is permitted under applicable law. The following table shows the change in the unrecognized income tax benefit associated with uncertain tax positions for the years ended October 31, 2022, 2021 and 2020 (in thousands): Unrecognized Balance at October 31, 2019 $ 556 Additions for tax positions related to the prior year 15 Reassessment of position (49) Balance at October 31, 2020 $ 522 Additions for tax positions related to the prior year 953 Reassessment of position (87) Balance at October 31, 2021 $ 1,388 Reassessment of position (27) Balance at October 31, 2022 $ 1,361 As of October 31, 2022, our liability for unrecognized tax benefits of $1.4 million related to certain U.S. federal and state tax items regarding the interpretation of tax laws and regulations, including a minimal amount of interest and penalties. We include all interest and penalties related to uncertain tax benefits within our income tax provision account. To the extent interest and penalties are not assessed with respect to uncertain tax positions or the uncertainty of deductions in the future, amounts accrued will be reduced and reflected as a reduction of the overall income tax provision. We, along with our su bsidiaries, file income tax returns in the U.S. and various state jurisdictions as well as in the U.K., Germany and Canada. In certain jurisdictions, the statute of limitations has not yet expired. We generally remain subject to examination of our U.S. income tax returns for 2018 and subsequent years. We generally remain subject to examination of our various state and foreign income tax returns for a period of four to five years from the date the return was filed. The state impact of any federal changes remains subject to examination by various stat es for a period of up to one year after formal notification to the state of the federal change. 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, 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. Our total unrecognized tax benefits, if recognized, would not materially affect our effective tax rate. The recorded amount of unrecognized tax benefits may decrease by approximately $1.0 million with in the next twelve months as a result of the upcoming closing of a statute of limitations. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Oct. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Purchase Obligations We are a party to non-cancelable purchase obligations primarily for door hardware, primary and secondary steel and primary and se condary aluminum used in our manufacturing processes, as well as expenditures related to capital projects in progress. We paid $11.0 million and $9.9 million pursuant to these arrangements for the years ended October 31, 2022 and 2021, respectively. These obligations total $7.6 million and $23.4 million at October 31, 2022 and 2021, respectively, and extend through fiscal 2023. Future amounts paid pursuant to th ese arrangements will depend, to some extent, on our usage. Asset Retirement Obligation We maintain an asset retirement obligation associated with a leased facility in Kent, Washington. We have estimated our future cash flows associated with this asset retirement obligation and recorded an asset and corresponding liability. We are depreciating the asset and accreting the liabilit y over a seven-year term, to culminate in an asset retirement obligation of $2.3 million as of February 2025, which is located in Other Liabilities on the Consolidated Balance Sheets. 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 fi scal 2023. Wh ile 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 | 12 Months Ended |
Oct. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurement of Assets and Liabilities | Fair Value Measurements 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 participant assumptions 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 b y correlation or other means. • Level 3 - Inputs that are both significant to the fair value measurement and unobservable. Carrying amounts reported on the balance sheets for cash, cash equivalen ts, 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 changes in interest rate risk. As a result, the fair value of our debt instruments approximates carrying value at October 31, 2022 and 2021 (Level 2 measurement). Our restricted stock units and 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 13. Stock-Based Compensation - Performance Share Awards. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Oct. 31, 2022 | |
Share-based Payment Arrangement, Noncash Expense [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation We have established and maintain an Omnibus Incentive Plan (2020 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 2020 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 2020 Plan is 3,139,895 as approved by the shareholders. Any officer, key employee and/or non-employee director is eligible for awards under the 2020 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, 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 a restricted stock award is entitled to all of the rights of a shareholder, except that the awards are 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 award activity during the years ended October 31, 2022, 2021 and 2020, follows: Restricted Stock Awards Weighted Average Non-vested at October 31, 2019 230,100 $ 17.02 Granted 63,400 18.82 Vested (55,000) 19.45 Forfeited (51,000) 17.30 Non-vested at October 31, 2020 187,500 16.82 Granted 73,300 20.68 Vested (44,400) 20.70 Forfeited — — Non-vested at October 31, 2021 216,400 17.28 Granted 84,400 22.54 Vested (88,700) 13.74 Forfeited — — Non-vested at October 31, 2022 212,100 $ 20.86 The total weighted average grant-date fair value of restricted stock awards that vested during the years ended October 31, 2022, 2021 and 2020 wa s $1.2 million, $0.9 million and $1.1 million, respectively. As of October 31, 2022, total unrecognized compensation cost related to unamortized restricted stock awards totaled $1.9 million. We expect to recognize this expense over the remaining weighted average period of 1.8 years. Stock Options Historically, stock options have been awarded to key employees, officers and non-employee directors. In 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, 2020, 2019, and 2018. Stock options typically vested 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 was determined on the grant date and expensed over the vesting period resulting in an increase in additional paid-in-capital. We used the Black-Scholes pricing model to estimate the grant date fair value. The inputs to this model included expected volatility, expected term, a risk-free rate and expected dividend rate at the time of grant. For employees who were nearing retirement-eligibility, we recognized stock option expense ratably over the shorter of the vesting period or the period from the grant-date to the retirement-eligibility date. The following table summarizes our stock option activity for the years ended October 31, 2022, 2021 and 2020. Stock Options Weighted Average Weighted Average Aggregate Outstanding at October 31, 2019 1,416,186 $ 18.71 4.2 $ 1,449 Granted — — Exercised (215,733) 17.09 Forfeited/Expired (105,124) 20.28 Outstanding at October 31, 2020 1,095,329 $ 18.88 3.6 $ 561 Granted — — Exercised (865,393) 18.80 Forfeited/Expired (11,632) 18.22 Outstanding at October 31, 2021 218,304 $ 19.37 3.4 $ 297 Granted — — Exercised (35,600) 19.36 Forfeited/Expired (7,587) 19.04 Outstanding at October 31, 2022 175,117 $ 19.39 2.9 $ 485 Vested at October 31, 2022 175,117 $ 19.39 2.9 $ 485 Exercisable at October 31, 2022 175,117 $ 19.39 2.9 $ 485 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. For the years ended October 31, 2022, 2021 and 2020, the total intrinsic value of our stock options that were exercised to taled $0.2 million, $4.2 million and $0.5 million, respectively. The total fair value of stock options vested during the years ended October 31, 2022, 2021 and 2020, was zero, zero and $0.6 million, respectively. 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 vesting 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 years ended October 31, 2022, 2021 and 2020, 36,669, 28,826 and 25,621 restricted stock units, respectively, were granted with corresponding weighted average grant date fair value of $22.52, $18.79, and $18.18, respectively. As of October 31, 2022 there were 21,774 unvested restricted stock units from the fiscal 2020 grant with corresponding weighted average grant date fair value of $17.08 . During the years ended October 31, 2022, 2021 and 2020, we paid $1.0 million, $0.8 million and $0.2 million to settle restricted stock units. Performance Share Award s We have awarded annual grants of performance shares to key employees and officers. Beginning with the fiscal year ended October 31, 2019, performance share awards vest with return on net assets (RONA) as the vesting condition, pay out 100% in cash, and are accounted for as liability. The expected cash settlement of the performance share award is recorded as a liability and is being marked to market over the three-year term of the award, and could 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 RONA performance metric: Grant Date Shares Awarded Grant Date Fair Value Shares Forfeited December 5, 2019 55,900 $ 19.40 5,300 December 2, 2020 65,300 $ 20.68 — December 9, 2021 80,900 $ 22.54 — In December 2021, 183,000 shares vested pursuant to the December 2018 grant, which were settled with a cash payment of $3.8 million. In December 2020, the December 2017 grant vested, however, no shares were awarded as performance criteria were not met. Performance share awards are payable in cash based upon the number of performance shares ultimately earned, and are therefore not considered outstanding shares. Performance Restricted Stock Units We awarded performance restricted stock units to key employees and officers. 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 performance restricted stock units 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 Grant Date Fair Value Shares Forfeited December 5, 2019 35,000 $ 19.40 — December 2, 2020 38,400 $ 20.68 — December 9, 2021 50,900 $ 21.06 — 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. The following table summarizes amounts expensed as selling, general and administrative expense related to restricted stock awards, stock options, restricted stock units, performance share awards and performance restricted stock units for the years ended October 31, 2022, 2021 and 2020 (in thousands): Year Ended October 31, 2022 2021 2020 Restricted stock awards $ 1,452 $ 1,235 $ 625 Stock options — — 10 Restricted stock units 1,167 1,197 186 Performance share awards 2,373 4,039 (170) Performance restricted stock units 840 729 515 Total compensation expense 5,832 7,200 1,166 Income tax effect 1,138 2,078 274 Net compensation expense $ 4,694 $ 5,122 $ 892 |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Oct. 31, 2022 | |
Stockholders' Equity Attributable to Parent [Abstract] | |
Stockholders' Equity | Stockholders' Equity As of October 31, 2022, our authorized capital stock consists of 125,000,000 shares of common stock, at par value of $0.01 per s hare, and 1,000,000 shares of preferred stock, with no par value. As of October 31, 2022 and 2021, we had 37,211,056 and 37,273,510 shares of common stock issued, respectively, and 33,129,250 and 33,274,785 shares of common stock outstanding, respectively. T here were no shares of preferred stock issued or outstanding at October 31, 2022 and 2021. Stock Repurchase Program and Treasury Stock On August 30, 2018, our Board of Directors approved a stock repurchase program that authorized the repurchase of up to $60.0 million worth of shares of our common stock. As of October 31, 2021, this share repurchase authorization was exhausted and the program was complete. During December 2021, our Board of Directors approved a new stock repurchase program that authorized the repurchase of up to $75.0 million worth of shares of our common stock. Repurchases under the program are made in open market transactions or privately negotiated transactions, subject to market conditions, applicable legal requirements and other relevant factors. The program does not have an expiration date or a limit on the number of shares that may be purchased. During the years ended October 31, 2022 and 2021, we p urchased 291,000 shares and 478,311 shares, respectively, at a cost of $6.6 million and $11.2 million respectively, under these programs. 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 zero, zero and $0.1 million, in the years ended October 31, 2022, 2021, and 2020, respectively. For a summary of treasury stock activity for the years ended October 31, 2022, 2021 and 2020, refer to the Consolidated Statement of Stockholders' Equity |
Other Income (Expense)
Other Income (Expense) | 12 Months Ended |
Oct. 31, 2022 | |
Other Income and Expenses [Abstract] | |
Other Income (Expense) | Other, net Other income included under the caption “Other, net” on the accompanying consolidated statements of income (loss), consisted of the following (in thousands): Year Ended October 31, 2022 2021 2020 Foreign currency transaction gains (losses) $ 386 $ (98) $ (42) Foreign currency exchange derivative gains (losses) 19 — (15) Pension service benefit 783 839 243 Interest income 19 5 28 Other (166) 8 66 Other income $ 1,041 $ 754 $ 280 |
Segment Information
Segment Information | 12 Months Ended |
Oct. 31, 2022 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information We present three reportable business segments: (1) 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) 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) NA Cabinet Components, comprising our cabinet door and components segment. We maintain a grouping called Unallocated Corporate & Other, which includes 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 and inter-segment eliminations, and executive incentive compensation and medical expense fluctuations relative to planned costs as determined during the annual planning process. Other general and administrative costs associated with the corporate office are allocated to the reportable segments, based upon a relative measure of profitability in order to more accurately reflect each reportable business segment's administrative costs. We allocate corporate expenses to businesses acquired mid-year from the date of acquisition. The accounting policies of our operating segments are the same as those used to prepare the accompanying consolidated financial statements. Corporate general and administrative expenses allocated during the years ended October 31, 2022, 2021 and 2020 were $24.5 million , $21.6 million and $21.7 million, respectively. ASC Topic 280-10-50, “Segment Reporting” (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 years ended October 31, 2022, 2021 and 2020 was as follows (in thousands): NA Fenestration EU Fenestration NA Cabinet Comp. Unallocated Corp. & Other Total Year Ended October 31, 2022 Net sales $ 687,458 $ 262,058 $ 275,704 $ (3,718) $ 1,221,502 Depreciation and amortization 16,253 9,674 13,830 352 40,109 Operating income (loss) 74,570 40,270 3,245 (6,804) 111,281 Capital expenditures 18,758 7,810 6,454 99 33,121 Total assets $ 279,139 $ 223,729 $ 176,154 $ 45,595 $ 724,617 Year Ended October 31, 2021 Net sales $ 578,332 $ 251,599 $ 246,075 $ (3,857) $ 1,072,149 Depreciation and amortization 18,730 10,373 13,263 366 42,732 Operating income (loss) 56,248 39,299 896 (14,573) 81,870 Capital expenditures 9,966 8,155 5,559 328 24,008 Total assets $ 268,773 $ 236,755 $ 178,671 $ 33,124 $ 717,323 Year Ended October 31, 2020 Net sales $ 483,415 $ 161,054 $ 210,099 $ (2,995) $ 851,573 Depreciation and amortization 23,555 9,468 13,732 474 47,229 Operating income (loss) 39,909 20,076 (2,502) (2,218) 55,265 Capital expenditures $ 15,761 $ 5,435 $ 4,423 $ 107 $ 25,726 The following table summarizes the change in the carrying amount of goodwill by segment for the years ended October 31, 2022 and 2021 (in thousands): NA Fenestration EU Fenestration NA Cabinet Comp. Unallocated Corp. & Other Total Balance as of October 31, 2020 $ 38,712 $ 68,295 $ 39,147 $ — $ 146,154 Foreign currency translation adjustment — 3,051 — — 3,051 Balance as of October 31, 2021 $ 38,712 $ 71,346 $ 39,147 $ — $ 149,205 Foreign currency translation adjustment — (11,350) — — (11,350) Balance as of October 31, 2022 $ 38,712 $ 59,996 $ 39,147 $ — $ 137,855 For further details of Goodwill, see Note 6, “Goodwill and Intangible Assets”, located herewith. We did not allocate non-operating expense or income tax expense to the reportable segments. The following table reconciles operating income as reported above to net income for the years ended October 31, 2022, 2021 and 2020 (in thousands): Year Ended October 31, 2022 2021 2020 Operating income $ 111,281 $ 81,870 $ 55,265 Interest expense (2,559) (2,530) (5,245) Other, net 1,041 754 280 Income tax expense (21,427) (23,114) (11,804) Net income $ 88,336 $ 56,980 $ 38,496 Geographic Information Our manufacturing facilities and all long-lived assets are located in the U.S., U.K. and Germany. We attribute our net sales to a geographic region based on the location of the customer. The following tables provide information concerning our net sales for the years ended October 31, 2022, 2021 and 2020, and our long-lived assets as of October 31, 2022 and 2021 (in thousands): Year Ended October 31, Net sales 2022 2021 2020 United States $ 911,180 $ 778,486 $ 654,802 Europe 255,400 244,308 158,831 Canada 31,442 25,007 18,213 Asia 15,021 18,445 11,504 Other foreign countries 8,459 5,903 8,223 Total net sales $ 1,221,502 $ 1,072,149 $ 851,573 October 31, Long-lived assets, net 2022 2021 United States $ 279,616 $ 291,282 Germany 41,669 25,513 United Kingdom 118,005 146,158 Total long-lived assets, net $ 439,290 $ 462,953 |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Oct. 31, 2022 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share We compute basic earnings per share by dividing net income 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 and contingent shares associated with performance share awards, if dilutive. The computation of basic and diluted earnings per share for the years ended October 31, 2022, 2021 and 2020 follows (in thousands, except per share data): Year Ended October 31, 2022 Net Income Weighted Average Shares Per Share Basic earnings per common share $ 88,336 33,048 $ 2.67 Effect of dilutive securities: Stock options 25 Restricted stock awards 100 Performance restricted stock units 32 Diluted earnings per common share $ 88,336 33,205 $ 2.66 Year Ended October 31, 2021 Basic earnings per common share $ 56,980 33,193 $ 1.72 Effect of dilutive securities: Stock options 82 Restricted stock awards 132 Performance restricted stock units 88 Diluted earnings per common share $ 56,980 33,495 $ 1.70 Year Ended October 31, 2020 Basic earnings per common share $ 38,496 32,689 $ 1.18 Effect of dilutive securities: Stock options 10 Restricted stock awards 90 Performance restricted stock units 32 Diluted earnings per common share $ 38,496 32,821 $ 1.17 We do not include equity instruments in our calculation of diluted earnings per share if those instruments would be antidilutive. Such dilution is dependent on the excess of the market price of our stock over the exercise price and other components of the treasury stock method. The following table shows anti-dilutive instruments for the three years ended October 31, 2022, 2021 and 2020 (shares in thousands): Year Ended October 31, 2022 2021 2020 Stock options — — 1,032 Restricted stock awards — — — Performance share awards — — — Total — — 1,032 |
Unaudited Quarterly Data
Unaudited Quarterly Data | 12 Months Ended |
Oct. 31, 2022 | |
Quarterly Financial Information Disclosure [Abstract] | |
Unaudited Quarterly Data | Unaudited Quarterly Data Selected quarterly financial data for the years ended October 31, 2022 and 2021 was as follows (amounts in thousands, except per share amounts): For the Quarter Ended January 31, 2022 April 30, 2022 July 31, 2022 October 31, 2022 Net sales $ 267,040 $ 322,893 $ 324,037 $ 307,532 Cost of sales (excluding depreciation and amortization) 211,834 249,651 251,446 240,073 Depreciation and amortization 10,257 10,563 9,734 9,555 Operating income 14,126 34,550 34,035 28,570 Net income 11,239 26,522 25,908 24,667 Basic earnings per share 0.34 0.80 0.79 0.75 Diluted earnings per share 0.34 0.80 0.78 0.75 Cash dividends paid per common share 0.08 0.08 0.08 0.08 For the Quarter Ended January 31, 2021 April 30, 2021 July 31, 2021 October 31, 2021 Net sales $ 230,147 $ 270,357 $ 279,877 $ 291,768 Cost of sales (excluding depreciation and amortization) 176,397 208,460 219,866 226,818 Depreciation and amortization 11,015 10,845 10,683 10,189 Operating income 11,835 21,380 21,562 27,093 Net income 7,852 14,551 13,679 20,898 Basic earnings per share 0.24 0.44 0.41 0.63 Diluted earnings per share 0.24 0.43 0.41 0.62 Cash dividends paid per common share 0.08 0.08 0.08 0.08 Qu arterly earnings per share results may not sum to the consolidated earnings per share results on the accompanying consolidated statements of income due to roun |
New Accounting Guidance
New Accounting Guidance | 12 Months Ended |
Oct. 31, 2022 | |
Accounting Changes and Error Corrections [Abstract] | |
New Accounting Guidance | New Accounting Guidance From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (FASB) or other standards setting bodies that we adopt as of the specified effective date. We did not adopt any new accounting pronouncements during the twelve months ended October 31, 2022. As of October 31, 2022, we believe the impact of any recently issued standards that are not yet effective are either not applicable to us at this time or will not have a material impact on our condensed consolidated financial statements upon adoption. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Oct. 31, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events |
Nature of Operations, Basis o_2
Nature of Operations, Basis of Presentation and Significant Accounting Policies (Policies) | 12 Months Ended |
Oct. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Principles of Consolidation, Policy | Basis of Presentation and Principles of ConsolidationOur consolidated financial statements have been prepared by us in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). We consolidate our wholly-owned subsidiaries and eliminate intercompany sales and transactions. We have no cost or equity investments in companies that are not wholly-owned. In our opinion, these audited financial statements contain all adjustments necessary to fairly present our financial position, results of operations and cash flows for the periods presented. |
Use of Estimates, Policy | Use of Estimates 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 ongoing basis, including those related to impairment of long lived assets and goodwill, pension and retirement liabilities, contingencies and income taxes. Changes in facts and circumstances may result in revised estimates and actual results may differ from these estimates. A summary of our significant accounting policies consistently applied in the preparation of the accompanying consolidated financial statements follows: |
Revenue From Contracts with Customers, Policy | Revenue from Contracts with Customers Revenue recognition We recognize revenue that reflects 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 transferred to our customers, and we are 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 products, 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 acc ount for product returns related to general returns and product nonconformance. 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. Pricing and sales i ncentives 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. Shipping and handling cost s 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 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 insulating glass 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 years ended October 31, 2022, 2021, and 2020 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 16, “Segment Information.” Year Ended October 31, 2022 2021 2020 (in thousands) NA Fenestration: United States - fenestration $ 609,572 $ 507,634 $ 427,616 International - fenestration 35,906 34,610 28,585 United States - non-fenestration 29,039 24,534 19,279 International - non-fenestration 12,941 11,554 7,935 $ 687,458 $ 578,332 $ 483,415 EU Fenestration: International - fenestration $ 194,854 $ 199,511 $ 134,432 International - non-fenestration 67,204 52,088 26,622 $ 262,058 $ 251,599 $ 161,054 NA Cabinet Components: United States - fenestration $ 17,696 $ 13,326 $ 11,842 United States - non-fenestration 254,726 230,559 196,479 International - non-fenestration 3,282 2,190 1,778 $ 275,704 $ 246,075 $ 210,099 Unallocated Corporate & Other: Eliminations $ (3,718) $ (3,857) $ (2,995) $ (3,718) $ (3,857) $ (2,995) Net sales $ 1,221,502 $ 1,072,149 $ 851,573 |
Cash and Cash Equivalents, Policy | Cash and Cash Equivalents Cash equivalents include all highly liquid investments with an original maturity of three months or less. Such securities with an original maturity which exceeds three months are deemed to be short-term investments. We maintain cash and cash equivalents at several financial institutions, which at times may not be federally insured or may exceed federally insured limits. We have not experienced any losses in such accounts and believe we are not exposed to any significant credit risks on such accounts. |
Concentraction Credit Risk and Allowance Policy | Concentration of Credit Risk and Allowance for Credit Losses Certain of our businesses or product lines are largely dependent on a relatively few large customers. Although we believe we have an exte nsive customer base, the loss of one of these large customers or if such customers were to incur a prolonged period of decline in business, our financial condition and results of operations could be adversely affected. For the years ended October 31, 2022 and 2020, one customer provided more than 10% of our consolidated net sales. For the year ended October 31, 2021, no customer provided more than 10% of our consolidated net sales. We have establishe d an allowance for credit losses to estimate the risk of loss associated with our accounts receivable balances. Our policy for determining the allowance is based on factors that affect collectability, including: (a) historical trends of write-offs, recoveries and credit losses; (b) the credit quality of our customers; and (c) projected economic and market conditions. We believe our allowance is adequate to absorb any known or probable lo |
Business Combinations Policy | Business CombinationsWe apply the acquisition method of accounting for business combinations, which requires us to make use of estimates and judgments to allocate the purchase price paid for acquisitions to the fair value of the assets and liabilities acquired. We account for contingent assets and liabilities at fair value on the acquisition date, and record changes to fair value associated with these assets and liabilities as a period cost as incurred. We use established valuation techniques and engage reputable valuation specialists to assist us with these valuations. However, there is a risk that we may not identify all pre-acquisition contingencies or that our estimates may not reflect the actual results when realized. We use a reasonable measurement period to record any adjustment related to the opening balance sheet (generally, less than one year). After the measurement period, changes to the opening balance sheet can result in the recognition of income or expense as period costs. To the extent these items stem from contingencies that existed at the balance sheet date, but are contingent upon the realization of future events, the cost is charged to expense at the time the future event becomes known. |
Inventory, Policy | Inventory We record inventory at the lower of cost or net realizable value. Inventories are valued using the first-in first-out (FIFO) method. Fixed costs related to excess manufacturing capacity are evaluated and expensed in the period, to ensure that inventory is properly capitalized. Inventory quantities are regularly reviewed and provisions for excess or obsolete inventory are recorded primarily based on our forecast of future demand and our estimates regarding current and future market conditions. Significant unanticipated variances to our forecasts could require a change in the provision for excess or obsolete inventory, resulting in a charge to net income during the period of the change. |
Impairment or Disposal of Long-Lived Assets, Policy | Long-Lived Assets Property, Plant and Equipment and Intangible Assets with Defined Lives We make judgments and estimates related to the carrying value of property, plant and equipment, intangible assets with defined lives, and long-lived assets, which include determining when to capitalize costs, the depreciation and amortization methods to use and the useful lives of these assets. We evaluate these assets for impairment when there are indicators that the carrying values of these assets might not be recoverable. Such indicators of impairment may include changes in technology, significant market fluctuations, historical losses or loss of a significant customer, or other changes in circumstance that could affect the assets’ ability to generate future cash flows. When we evaluate these assets for impairment, we compare the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset to its carrying value. If the carrying value exceeds the sum of the undiscounted cash flows, and there is no alternative use for the asset, we determine that the asset is impaired. To measure the impairment charge, we compare the carrying amount of the long-lived asset to its fair value, as determined by quoted market prices in active markets, if available, or by discounting the projected future cash flows. This calculation of fair value requires us to develop and employ long-term forecasts of future operating results related to these assets. These forecasts are based on assumptions about demand for our products and future market conditions. Future events and unanticipated changes to these assumptions could require a provision for impairment, resulting in a charge to net income during the period of the change. We monitor relevant circumstances, including industry trends, general economic conditions, and the potential impact that such circumstances might have on the valuation of our identifiable intangible assets with finite lives. Events and changes in circumstance that may cause a triggering event and necessitate such a review include, but are not limited to: a decrease in sales for certain customers, improvements or changes in technology, and/or a decision to discontinue the use of a trademark or trade name, or to allow a patent to lapse. Such events could negatively impact the fair value of our identifiable intangible assets. In such circumstances, we may evaluate the underlying assumptions and estimates made by us in order to assess the appropriate valuation of these identifiable intangible assets and compare to the carrying value of the assets. We may be required to write down these identifiable intangible assets and record a non-cash impairment charge. When we originally value our intangible assets, we use a variety of techniques to establish the carrying value of the assets, including the relief from royalty method, excess current year earnings method and income method. The World Health Organization's (WHO), declaration of COVID-19 as a global pandemic also created significant changes in market conditions throughout 2020 that have continued into 2021. We determined that these conditions were indicators of a triggering event in 2020 which necessitated an evaluation of certain long-term assets used in these businesses for potential impairment. We compared the projected undiscounted cash flows we expected to realize associated with these assets over the remaining useful lives of the primary operating assets to the net book value of the long-term assets, including goodwill, and determined that these assets were not impaired. During the year ended October 31, 2022, our North American vinyl extrusion operations in our NA Fenestration segment experienced lower-than-expected operating results due to the continued impact of inflation and historical customer contracts which prevent us from passing on the full impact of higher costs to our customers. We determined that this condition was an indicator of a triggering event which necessitated an evaluation of certain long-term assets used in this business for potential impairment. We compared the projected undiscounted cash flows we expected to realize associated with these assets over the remaining useful lives of the primary operating assets to the net book value of the long-term assets and determined that these assets were not impaired. Should we be unable to successfully increase prices to offset inflation, it is possible that we could incur an impairment in the future. There were no indicators of triggering events noted for any period in the year ended October 31, 2021. Therefore, we did not record an impairment charge related to property, plant and equipment or intangible assets with defined lives during the years ended October 31, 2022, 2021 and 2020. Software development costs, including costs incurred to purchase third-party software, are capitalized when we have determined that the technology is capable of meeting our performance requirements, and we have authorized funding for the project. We cease capitalization of software costs when the software is substantially complete and is ready for its intended use. The software is then amortized over its estimated useful life. When events or circumstances indicate the carrying value of internal use software might not be recoverable, we assess the recoverability of these assets by comparing the carrying value of the asset to the undiscounted future cash flows expected to be generated from the asset’s use, consistent with the methodology to test other property, plant and equipment for impairment. Property, plant and equipment is stated at cost and is depreciated using the straight-line method over the estimated useful lives of the assets. We capitalize betterments which extend the useful lives or significantly improve the operational efficiency of assets. We expense repair and maintenance costs as incurred. The estimated useful lives of our primary asset categories at October 31, 2022 were as follows: Useful Life (in Years) Land improvements 7 to 25 Buildings 25 to 40 Building improvements 5 to 20 Machinery and equipment 2 to 15 Leasehold improvements are depreciated over the shorter of their estimated useful lives or the term of the lease. |
Goodwill and Intangible Assets, Goodwill, Policy | Goodwill We use the acquisition method to account for business combinations and, to the extent that the purchase price exceeds the fair value of the net assets acquired, we record goodwill. In accordance with U.S. GAAP, we are required to evaluate our goodwill at least annually. We perform our annual goodwill assessment as of August 31, or more frequently if indicators of impairment exist. Qualitative factors that indicate impairment could include, but are not limited to, (i) macroeconomic conditions, (ii) industry and market considerations, (iii) cost factors, (iv) overall financial performance of the reporting unit, and (v) other relevant entity-specific events. The first step in our annual goodwill assessment is to perform the optional qualitative assessment allowed by ASC Topic 350 “Intangibles - Goodwill and Other” (ASC 350). In our qualitative assessment, we evaluate relevant events or circumstances to determine whether it is more likely than not (i.e., greater than 50%) that the fair value of a reporting unit is less than its carrying amount. If we determine that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, ASC 350 requires us to compare the fair value of such reporting unit to its carrying value including goodwill. To determine the fair value of our reporting units, we use multiple valuation techniques including a discounted cash flow analysis, using the applicable weighted average cost of capital, in combination with a market approach that uses market multiples and a selection of guideline public companies. This test requires us to make assumptions about the future growth of our business and the market in general, as well as other variables such as the level of investment in capital expenditure, growth in working capital requirements and the terminal or residual value of our reporting units beyond the periods of estimated annual cash flows. We use a third-party valuation firm to assist us with this analysis. If the fair value of each reporting unit exceeds its carrying value, no action is required. Otherwise, an impairment loss is recorded to the extent that the carrying amount of the reporting unit including goodwill exceeds the fair value of that reporting unit. We believe the estimates and assumptions used in our impairment assessment are reasonable based on available market information, but variations in any of the assumptions could result in materially different calculations of fair value and determinations of whether or not an impairment is indicated during current or future periods. At our annual testing date, August 31, 2022, we had five reporting units with goodwill balances: two reporting units included in our NA Fenestration operating segment, two reporting units included in our EU Fenestration operating segment, and one reporting unit included in our NA Cabinet Components operating segment. We performed a qualitative assessment of one of the reporting units in the NA Fenestration segment and two of the reporting units in the EU Fenestration segment. This review included an analysis of historical goodwill test results, operating results relative to forecast, projected results over the next five years, and other measures and concluded that there were no indicators of potential impairment associated with these reporting units. Therefore, no additional testing was deemed necessary for these three reporting units. Also, at our annual testing date, we performed a quantitative assessment of the reporting unit in our NA Cabinet Components segment primarily due to the impairment of goodwill during the second and fourth quarters of 2019 and the history of a narrow margin of fair value above carrying value in quantitative assessments performed in prior years. We determined that the fair value of this reporting unit exceeded their carrying values by approximat ely 12.0%. We also elected to update the quantitative assessment of the other reportable unit in the NA Fenestration operating segment. We determined that the fair value of this reporting unit exceeded their carrying values by approximat ely 384.9%. We concluded that no impairment was necessary. |
Restructurings, Policy | RestructuringWe 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 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 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 assumed sublet in the current period. For other costs directly related to the restructuring effort, such as equipment moving costs, we expense in the period incurred. |
Liability Reserve Estimate, Policy | Insurance We manage our exposure to losses for workers’ compensation, group medical, property, casualty and other insurance claims through a combination of self-insurance retentions and insurance coverage with third-party carriers. We record undiscounted liabilities associated with our portion of these exposures, which we estimate by considering various factors such as our historical claims experience, severity factors and estimated claims incurred but not reported, for which we have developed loss development factors, which are estimates as to how claims will develop over time until closed. While we consider a number of factors in preparing the estimates, sensitive assumptions using significant judgment are made in determining the amounts that are accrued in the financial statements. Actual claims could differ significantly from these estimated liabilities, depending on future claims experience. We do not record insurance recoveries until any contingencies relating to the claim have been resolved. |
Pension and Other Postretirement Plans, Pensions, Policy | Retirement Plans We sponsor a defined benefit pension plan and an unfunded postretirement plan that provides health care and life insurance benefits for a limited pool of eligible retirees and dependents. To measure our liabilities associated with these plans, we make assumptions related to future events, including expected return on plan assets, rate of compensation increases, and healthcare cost trend rates. The discount rate reflects the rate at which benefits could be effectively settled on the measurement date. We determine our discount rate using a FTSE Above Median pension discount curve whereby target yields are developed from bonds across a range of maturity points, and a curve is fitted to those targets. Spot rates (zero coupon bond yields) are developed from the curve and used to discount benefit payments associated with each future year. Actual pension plan asset investment performance, as well as other economic experience such as discount rate and demographic experience, will either reduce or increase unamortized pension losses at the end of any fiscal year, which ultimately affects future pension costs. |
Standard Product Warranty, Policy | Warranty Obligations We accrue warranty obligations when we recognize revenue for certain products. Our provision for warranty obligations is based on historical costs incurred for such obligations and is adjusted, where appropriate, based on current conditions and factors. Our ability to estimate our warranty obligations is subject to significant uncertainties, including changes in product design and our overall product sales mix. |
Income Tax, Policy | Income Taxes We record the estimated future tax effects of temporary differences between the tax basis of assets and liabilities and the amounts reported in our consolidated balance sheets, as well as net operating losses and tax credit carry forwards. We evaluate the carrying value of the net deferred tax assets and determine whether we will be able to generate sufficient future taxable income to realize our deferred tax assets. We perform this review for recoverability on a jurisdictional basis, whereby we consider both positive and negative evidence related to the likelihood of realization of the deferred tax assets. The weight given to the positive and negative evidence is commensurate with the extent to which the evidence can be objectively verified. Cumulative losses in recent years is a significant piece of negative evidence that is difficult to overcome in determining that a valuation allowance is not needed against deferred tax assets. Thus, it is generally difficult for positive evidence regarding projected future taxable income exclusive of reversing taxable temporary differences to outweigh objective negative evidence of recent financial reporting losses. We believe we will fully realize our deferred tax assets, net of a recorded valuation allowance. We project future taxable income using the same forecasts used to test long-lived assets and intangibles for impairment, scheduling out the future reversal of existing taxable temporary differences and reviewing our most recent financial operations. In the event the estimates and assumptions indicate we will not generate sufficient future taxable income to realize our deferred tax assets, we record a valuation allowance against a portion of our deferred tax assets. We evaluate our ongoing tax positions to determine if it is more-likely-than-not we will be successful in defending such positions if challenged by taxing authorities. To the extent that our tax positions do not meet the more-likely-than-not criteria, we record a liability for uncertain tax positions. We have recorded a liability for uncertain tax positions which stem from certain federal and state tax items related to the interpretation of tax laws and regulations. We continue to evaluate our positions regarding various state tax interpretations at each reporting date, until the applicable statute of limitations lapse. |
Derivatives, Policy | Derivative InstrumentsWe have historically used financial and commodity-based derivative contracts to manage our exposure to fluctuations in foreign currency exchange rates and aluminum prices. All derivatives are measured at fair value on a recurring basis. We have not designated the derivative instruments we use as cash flow hedges under ASC Topic 815 “Derivatives and Hedging” (ASC 815). Therefore, all gains and losses, both realized and unrealized, are recognized in the consolidated statements of income (loss) in the period of the change as the underlying assets and liabilities are marked-to-market. We do not enter into derivative instruments for speculative or trading purposes. As such, these instruments are considered economic hedges, and are reflected in the operating activities section of the consolidated statements of cash flow. |
Foreign Currency Transactions and Translations Policy | Foreign Currency Translation Our consolidated financial statements are presented in our reporting currency, the United States Dollar. Our German and U.K. operations are measured using the local currency as the functional currency. The assets and liabilities of our foreign operations which are denominated in other currencies are translated to United States Dollars using the prevailing exchange rates as of the balance sheet date. Revenues and expenses are translated at the average exchange rates for the applicable period. The resulting translation adjustments are recorded as a component of accumulated other comprehensive loss on the consolidated balance sheets. |
Share-based Compensation, Option and Incentive Plans Policy | Stock–Based Compensation We have issued stock-based compensation in the form of stock options to directors, employees and officers, and non-vested restricted stock awards to certain key employees and officers. We apply the provisions of ASC Topic 718 “Compensation - Stock Compensation” (ASC 718), to determine the fair value of stock option awards on the date of grant using the Black-Scholes valuation model. We recognize the fair value as compensation expense on a straight-line basis over the requisite service period of the award based on awards ultimately expected to vest. Stock options granted to directors vest immediately while the stock options granted to our employees and officers typically vest ratably over a three-year period with service and continued employment as the vesting conditions. For new option grants to retirement-eligible employees, we recognize expense and vest immediately upon grant, consistent with the retirement vesting acceleration provisions of these grants. For employees near retirement age, we amortize such grants over the period from the grant date to the retirement-eligibility date if such period is shorter than the standard vesting schedule. For grants of non-vested restricted stock, we calculate the compensation expense at the grant date as the number of shares granted multiplied by the closing stock price of our common stock on the date of grant. This expense is recognized ratably over the vesting period. Our non-vested restricted stock grants to officers and employees cliff vest over a three-year period with service and continued employment as the only vesting criteria. Our fair value determination of stock-based payment awards on the date of grant using an option-pricing model is affected by our stock price as well as assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to, our expected stock price volatility over the term of the awards, actual and projected employee stock option exercise behavior over the expected term, our dividend rate, risk-free rate and expectation with regards to forfeitures. Option-pricing models were developed for use in estimating the value of traded options that have no vesting or hedging restrictions and are fully transferable. Because our employee stock options have certain characteristics that are significantly different from traded options, and because changes in the subjective assumptions can materially affect the estimated value, the valuation models may not provide an accurate measure of the fair value of our employee stock options. Accordingly, that value may not be indicative of the fair value observed in a willing buyer/willing seller market transaction. We have granted other awards which are linked to the performance of our common stock, but will settle in cash rather than the issuance of shares of our common stock. The value of these awards fluctuates with changes in our stock price, with the resulting gains or losses reflected in the period of the change. We have recorded current and non-current liabilities related to these awards reflected in the accompanying consolidated balance sheets at October 31, 2022 and 2021. See Note 13, “Stock-based Compensation.” In addition, we have granted performance share awards which use return on net assets as the vesting condition and the awards settle in cash. We use a Monte Carlo simulation model to value the market condition and our stock price on the date of grant to value the internal performance condition and recognize expense ratably over the vesting period of three years. We esti mate that the performance measures will be met and shares will vest at target until the year of settlement (third year of cliff vesting). As of October 31, 2022 , we have deemed 101,200 performance share awards related to the December 2019 grants as probable to vest. We have also granted performance restricted stock units which settle in shares upon vesting. These awards cliff vest upon a three-year service period with the absolute performance of our common stock as the vesting criteria. The number of performance restricted stock units 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 use 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. 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 October 31, 2022, we have deemed 32,680 shares related to the December 2019 |
Stockholders' Equity, Policy | Treasury Stock We use the cost method to record treasury stock purchases whereby the entire cost of the acquired shares of our common stock is recorded as treasury stock (at cost). When we subsequently reissue these shares, proceeds in excess of cost upon the issuance of treasury shares are credited to additional paid-in-capital, while any deficiency is charged to retained earnings. |
Earnings Per Share, Policy | Earnings per Share Data We calculate basic earnings per share based on the weighted average number of our common shares outstanding for the applicable period. We calculate diluted earnings per share based on the weighted average number of our common shares outstanding for the period plus all potentially dilutive securities using the treasury stock method, whereby we assume that all such shares are converted into common shares at the beginning of the period, if deemed to be dilutive. If we incur a loss from continuing operations, the effects of potentially dilutive common stock equivalents (stock options and unvested restricted stock awards) are excluded from the calculation of diluted earnings per share because the effect would be anti-dilutive. Performance shares and performance restricted stock units are excluded from contingent shares for purposes of calculating diluted weighted average shares until the performance measure criteria is probable and shares are likely to be issued. |
Subsequent Events, Policy | Subsequent Events We have evaluated events occurring after the balance sheet date for possible disclosure as a subsequent event through the |
Nature of Operations, Basis o_3
Nature of Operations, Basis of Presentation and Significant Accounting Policies (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Product Sales | The following table summarizes our product sales for the three years ended October 31, 2022, 2021, and 2020 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 16, “Segment Information.” Year Ended October 31, 2022 2021 2020 (in thousands) NA Fenestration: United States - fenestration $ 609,572 $ 507,634 $ 427,616 International - fenestration 35,906 34,610 28,585 United States - non-fenestration 29,039 24,534 19,279 International - non-fenestration 12,941 11,554 7,935 $ 687,458 $ 578,332 $ 483,415 EU Fenestration: International - fenestration $ 194,854 $ 199,511 $ 134,432 International - non-fenestration 67,204 52,088 26,622 $ 262,058 $ 251,599 $ 161,054 NA Cabinet Components: United States - fenestration $ 17,696 $ 13,326 $ 11,842 United States - non-fenestration 254,726 230,559 196,479 International - non-fenestration 3,282 2,190 1,778 $ 275,704 $ 246,075 $ 210,099 Unallocated Corporate & Other: Eliminations $ (3,718) $ (3,857) $ (2,995) $ (3,718) $ (3,857) $ (2,995) Net sales $ 1,221,502 $ 1,072,149 $ 851,573 |
Property Assets Useful Life | The estimated useful lives of our primary asset categories at October 31, 2022 were as follows: Useful Life (in Years) Land improvements 7 to 25 Buildings 25 to 40 Building improvements 5 to 20 Machinery and equipment 2 to 15 |
Cash Flow, Supplemental Disclosures | The following table summarizes our supplemental cash flow information for the years ended October 31, 2022, 2021 and 2020 (in thousands): Year Ended October 31, 2022 2021 2020 Cash paid for interest $ 1,982 $ 1,993 $ 4,715 Cash paid for income taxes 26,410 22,160 12,118 Cash received from income tax refunds 2,235 381 352 Noncash investing and financing activities: (Decrease) increase in capitalized expenditures in accounts payable $ (1,692) $ 1,124 $ 2,370 |
Receivables & Allowance (Tables
Receivables & Allowance (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Receivables [Abstract] | |
Accounts Receivable | Accounts receivable consisted of the following as of October 31, 2022 and 2021 (in thousands): October 31, 2022 2021 Trade receivables $ 95,851 $ 107,725 Other 456 924 Total 96,307 108,649 Less: Allowance for credit losses 289 340 Accounts receivable, net $ 96,018 $ 108,309 |
Financing Receivable, Current, Allowance for Credit Loss | The changes in our allowance for credit losses were as follows (in thousands): Year Ended October 31, 2022 2021 2020 Beginning balance as of November 1, 2021, 2020 and 2019 $ 340 $ 161 $ 393 Current period provision for expected credit 314 267 262 Amounts written off (299) (88) (494) Recoveries 10 — — Foreign currency translation adjustments (76) — — Balance as of October 31, 2022, 2021 and 2020 $ 289 $ 340 $ 161 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories consisted of the following at October 31, 2022 and 2021 (in thousands): October 31, 2022 2021 Raw materials $ 68,455 $ 49,867 Finished goods and work in process 54,013 43,499 Supplies and other 1,551 2,099 Total 124,019 95,465 Less: Inventory reserves 3,129 2,936 Inventories, net $ 120,890 $ 92,529 |
Inventory Reserve Rollforward | The changes in our inventory reserve accounts were as follows (in thousands): Year Ended October 31, 2022 2021 2020 Beginning balance as of November 1, 2021, 2020 and 2019 $ 2,936 $ 6,484 $ 3,790 Charged to cost of sales 494 (568) 2,713 Write-offs (133) (3,060) — Other (168) 80 (19) Balance as of October 31, 2022, 2021 and 2020 $ 3,129 $ 2,936 $ 6,484 |
Property, Plant & and Equipment
Property, Plant & and Equipment (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property, plant and equipment consisted of the following at October 31, 2022 and 2021 (in thousands): October 31, 2022 2021 Land and land improvements $ 10,702 $ 10,285 Buildings and building improvements 105,696 101,740 Machinery and equipment 384,023 386,996 Construction in progress 28,507 16,102 Property, plant and equipment, gross 528,928 515,123 Less: Accumulated depreciation 348,528 336,493 Property, plant and equipment, net $ 180,400 $ 178,630 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Leases [Abstract] | |
Assets and Liabilities, Lessee | The table below presents the lease-related assets and liabilities recorded on the balance sheet at October 31, 2022 and 2021 (in thousands): October 31, Leases Classification 2022 2021 Assets Operating lease assets Operating lease right-of-use assets $ 56,000 $ 52,708 Finance lease assets Property, plant and equipment (less accumulated depreciation of $3,726 and $2,300) 22,003 16,921 Total lease assets $ 78,003 $ 69,629 Liabilities Current Operating Current operating lease liabilities $ 7,727 $ 8,196 Finance Current maturities of long-term debt 1,336 1,114 Noncurrent Operating Noncurrent operating lease liabilities 49,286 45,367 Finance Long-term debt 17,816 14,335 Total lease liabilities $ 76,165 $ 69,012 |
Lease, Cost | The table below presents the components of lease costs for the year ended October 31, 2022 and 2021 (in thousands): Year Ended October 31, 2022 2021 Operating lease cost $ 9,934 $ 10,125 Finance lease cost Amortization of leased assets 1,332 1,165 Interest on lease liabilities 583 561 Variable lease costs 977 983 Total lease cost $ 12,826 $ 12,834 The table below presents supplemental cash flow information related to leases for the year ended October 31, 2022 and 2021 (in thousands): Year Ended October 31, 2022 2021 Cash paid for amounts included in the measurement of lease liabilities: Finance leases - financing cash flows $ 1,162 $ 1,003 Finance leases - operating cash flows $ 583 $ 561 Operating leases - operating cash flows $ 9,955 $ 9,621 Right-of-use assets obtained in exchange for lease liabilities: Operating leases $ 13,872 $ 8,737 Finance leases $ 6,467 $ 469 |
Lease Term and Discount Rate, Lessee | The table below presents the weighted average remaining lease terms and weighted average discount rates for the Company's leases as of October 31, 2022 and 2021: October 31, 2022 2021 Weighted average remaining lease term (in years) Operating leases 10.8 7.7 Financing leases 13.7 15.1 Weighted average discount rate Operating leases 3.84 % 3.23 % Financing leases 3.78 % 3.72 % |
Lessee, Operating Lease, Liability, Maturity | The table below presents the maturity of the lease liabilities as of October 31, 2022 (in thousands): Operating Leases Finance Leases 2023 $ 9,668 $ 2,027 2024 8,920 1,980 2025 7,213 1,922 2026 6,229 1,807 2027 5,589 1,709 Thereafter 33,769 15,123 Total lease payments 71,388 24,568 Less: present value discount 14,378 5,418 Total lease liabilities $ 57,010 $ 19,150 |
Finance Lease, Liability, Fiscal Year Maturity | The table below presents the maturity of the lease liabilities as of October 31, 2022 (in thousands): Operating Leases Finance Leases 2023 $ 9,668 $ 2,027 2024 8,920 1,980 2025 7,213 1,922 2026 6,229 1,807 2027 5,589 1,709 Thereafter 33,769 15,123 Total lease payments 71,388 24,568 Less: present value discount 14,378 5,418 Total lease liabilities $ 57,010 $ 19,150 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in the Carrying Amount of Goodwill | The change in the carrying amount of goodwill for the years ended October 31, 2022 and 2021 was as follows (in thousands): Year Ended October 31, 2022 2021 Beginning balance as of November 1, 2021 and 2020 $ 149,205 $ 146,154 Foreign currency translation adjustment (11,350) 3,051 Balance as of October 31, 2022 and 2021 $ 137,855 $ 149,205 |
Schedule of Acquired Finite-Lived Intangible Assets by Major Class | Amortizable intangible assets consisted of the following as of October 31, 2022 and 2021 (in thousands): October 31, 2022 October 31, 2022 October 31, 2021 Remaining Weighted Average Useful Life Gross Carrying Accumulated Gross Carrying Accumulated Customer relationships 8 years $ 139,607 $ 88,646 $ 146,207 $ 81,086 Trademarks and trade names 7 years 54,389 40,610 56,437 39,589 Patents and other technology 5 years 22,390 22,095 22,525 22,084 Total $ 216,386 $ 151,351 $ 225,169 $ 142,759 |
Estimated Amortization Expense Related to Intangible Assets | Estimated remaining amortization expense, assuming current intangible balances and no new acquisitions, for future fiscal years as of October 31, 2022 (in thousands): Estimated 2023 $ 10,908 2024 10,156 2025 8,930 2026 8,855 2027 8,856 Thereafter 17,330 Total $ 65,035 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Accrued Liabilities [Abstract] | |
Accrued Liabilities | Accrued liabilities consisted of the following at October 31, 2022 and 2021 (in thousands): October 31, 2022 2021 Payroll, payroll taxes and employee benefits $ 23,878 $ 30,039 Accrued insurance and workers compensation 7,232 6,340 Sales allowances 7,456 8,590 Deferred compensation (current portion) — 395 Deferred revenue 792 627 Warranties 13 77 Audit, legal, and other professional fees 3,136 1,886 Accrued taxes 2,864 3,258 Other 6,743 4,944 Accrued liabilities $ 52,114 $ 56,156 |
Debt and Capital Lease Obliga_2
Debt and Capital Lease Obligations (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Debt Disclosure [Abstract] | |
Debt & Capital Lease Obligations | Long-term debt consisted of the following at October 31, 2022 and 2021 (in thousands): October 31, 2022 2021 Revolving Credit Facility $ 13,000 $ 38,000 Finance lease obligations and other 19,202 15,537 Unamortized deferred financing fees (1,528) (597) Total debt 30,674 52,940 Less: Current maturities of long-term debt 1,046 846 Long-term debt $ 29,628 $ 52,094 |
Schedule of Margin and Commitment Fee | The applicable margin and commitment fees are outlined in the following table: Pricing Level Consolidated Leverage Ratio Commitment Fee Eurocurrency Rate Loans and RFR Loans Base Rate Loans I Less than or equal to 1.50 to 1.00 0.150% 1.25% 0.25% II Greater than 1.50 to 1.00, but less than or equal to 2.25 to 1.00 0.175% 1.50% 0.50% III Greater than 2.25 to 1.00, but less than or equal to 3.00 to 1.00 0.200% 1.75% 0.75% IV Greater than 3.00 to 1.00 0.250% 2.00% 1.00% |
Schedule of Maturities of Long-term Debt | The table below presents the scheduled maturity dates of our long-term debt outstanding (excluding deferred financing fees of $1.5 million) at October 31, 2022 (in thousands): Revolving Credit Facility Finance Leases and Other Obligations Aggregate Maturities 2023 $ — $ 2,065 $ 2,065 2024 — 1,992 1,992 2025 — 1,922 1,922 2026 — 1,807 1,807 2027 13,000 1,709 14,709 Thereafter — 15,125 15,125 Total debt payments 13,000 24,620 37,620 Less: present value discount of finance leases — (5,418) (5,418) Total $ 13,000 $ 19,202 $ 32,202 |
Retirement Plans (Tables)
Retirement Plans (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Retirement Benefits [Abstract] | |
Funded Status and Net periodic Benefit Cost | The changes in benefit obligation and plan assets, and our funded status (reported in deferred pension and postretirement benefits on the consolidated balance sheets) were as follows (in thousands): October 31, Change in Benefit Obligation: 2022 2021 Beginning balance as of November 1, 2021 and 2020 $ 42,379 $ 44,825 Service cost 860 850 Interest cost 806 756 Actuarial loss (6,944) (849) Benefits paid (349) (359) Administrative expenses (604) (732) Settlements (3,619) (2,112) Projected benefit obligation at October 31, 2022 and 2021 $ 32,529 $ 42,379 Change in Plan Assets: Beginning balance as of November 1, 2021 and 2020 $ 37,642 $ 34,120 Actual return on plan assets (4,458) 6,225 Employer contributions — 500 Benefits paid (349) (359) Administrative expenses (604) (732) Settlements (3,619) (2,112) Fair value of plan assets at October 31, 2022 and 2021 $ 28,612 $ 37,642 Noncurrent liability - Funded Status $ (3,917) $ (4,737) |
Net Periodic Pension Cost | The net periodic benefit cost for the years ended October 31, 2022, 2021 and 2020, was as follows (in thousands): Year Ended October 31, 2022 2021 2020 Service cost $ 860 $ 850 $ 1,262 Interest cost 806 756 1,139 Expected return on plan assets (1,991) (1,960) (2,006) Amortization of net loss 6 143 162 Settlements 396 222 462 Net periodic benefit cost $ 77 $ 11 $ 1,019 |
Amounts Recognized in Other Comprehensive Income (Loss) | The changes in plan assets and projected benefit obligations which were recognized in our other comprehensive loss for the years ended October 31, 2022, 2021 and 2020 were as follows (in thousands): Year Ended October 31, 2022 2021 2020 Net (gain) loss arising during the period $ (495) $ (5,112) $ 2,141 Less: Amortization of net loss 6 143 162 Less: Curtailments — — 1,141 Less: Settlements 396 222 462 Total recognized in other comprehensive (income) loss $ (897) $ (5,477) $ 376 |
Assumptions Used in Benefit Calculations | The following table presents our assumptions for pension benefit calculations for the years ended October 31, 2022, 2021 and 2020: For the Year Ended October 31, 2022 2021 2020 2022 2021 2020 Weighted Average Assumptions: Benefit Obligation Net Periodic Benefit Cost Discount rate 5.36% 2.77% 3.22% 2.77% 2.60% 3.10% Rate of compensation increase —% —% —% —% —% —% Expected return on plan assets n/a n/a n/a 5.50% 6.00% 6.50% |
Allocation and Fair Value of Pension Assets | The following tables provide our target allocation for the year ended October 31, 2022, as well as the actual asset allocation by asset category and fair value measurements as of October 31, 2022 and 2021: Target Allocation Actual Allocation October 31, 2022 October 31, 2022 October 31, 2021 Equity securities — % — % 51.0 % Fixed income 100.0 % 100.0 % 49.0 % Fair Value Measurements at October 31, 2022 October 31, 2021 (In thousands) Money market fund $ 22,508 $ 300 Large capitalization — 8,231 Small capitalization — 1,493 International equity — 6,992 Other — 2,236 Equity securities $ — $ 18,952 High-quality core bond 4,980 13,787 High-quality government bond 547 2,301 High-yield bond 577 2,302 Fixed income $ 6,104 $ 18,390 Total securities (1) $ 28,612 $ 37,642 |
Expected Benefit Payments | The following table presents the total benefit payments expected to be paid to participants by year, which includes payments funded from our assets, as well as payments paid from the plan for the year ended October 31, (in thousands): Pension Benefits 2023 $ 22,880 2024 729 2025 770 2026 750 2027 704 2028 - 2032 3,415 Total $ 29,248 |
Income Tax (Tables)
Income Tax (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Components of Income Tax Expense (Benefit) | The following table summarizes the components of income tax expense for the years ended October 31, 2022, 2021 and 2020 (in thousands): Year Ended October 31, 2022 2021 2020 Current Federal $ 11,553 $ 10,993 $ 6,043 State and local 740 3,447 1,505 Non-United States 7,037 6,889 4,445 Total current 19,330 21,329 11,993 Deferred Federal 2,127 (842) (64) State and local (229) (277) (315) Non-United States 199 2,904 190 Total deferred 2,097 1,785 (189) Total income tax expense $ 21,427 $ 23,114 $ 11,804 |
Schedule of Income before Income Tax, Domestic and Foreign [Table Text Block] | For financial reporting purposes, income before income taxes for the years ended October 31, 2022, 2021 and 2020 includes the following components (in thousands): Year Ended October 31, 2022 2021 2020 Domestic $ 64,850 $ 36,879 $ 26,229 Foreign 44,913 43,215 24,071 Total income before income taxes $ 109,763 $ 80,094 $ 50,300 |
Effective Income Tax Rate | The following table reconciles our effective income tax rate to the federal statutory rate for the years ended October 31, 2022, 2021 and 2020: Year Ended October 31, 2022 2021 2020 United States tax at statutory rate 21.0 % 21.0 % 21.0 % State and local income tax 0.4 % 3.1 % 1.7 % Non-United States income tax (0.8) % 2.3 % 1.2 % U.K. patent box benefit (1.2) % (1.4) % (2.0) % U.S. income tax credits (3.2) % (4.2) % (2.3) % Net U.S. tax on non-United States earnings 3.2 % 4.2 % 2.5 % Non-cash compensation (1.7) % 1.9 % (0.3) % Other 1.8 % 2.0 % 1.7 % Effective tax rate 19.5 % 28.9 % 23.5 % |
Deferred Tax Assets and Liabilities | Significant components of our net deferred tax liabilities and assets were as follows (in thousands): October 31, 2022 2021 Deferred tax assets: Employee benefit obligations $ 8,046 $ 7,591 Accrued liabilities and reserves 1,430 1,425 Pension and other benefit obligations 1,426 1,934 Inventory 1,409 894 Loss and tax credit carry forwards 1,589 1,857 Other — 107 Total gross deferred tax assets 13,900 13,808 Less: Valuation allowance 534 1,174 Total deferred tax assets, net of valuation allowance 13,366 12,634 Deferred tax liabilities: Property, plant and equipment 15,467 11,187 Goodwill and intangibles 20,162 23,412 Other 14 — Total deferred tax liabilities 35,643 34,599 Net deferred tax liabilities $ 22,277 $ 21,965 |
Unrecognized Tax Benefits | The following table shows the change in the unrecognized income tax benefit associated with uncertain tax positions for the years ended October 31, 2022, 2021 and 2020 (in thousands): Unrecognized Balance at October 31, 2019 $ 556 Additions for tax positions related to the prior year 15 Reassessment of position (49) Balance at October 31, 2020 $ 522 Additions for tax positions related to the prior year 953 Reassessment of position (87) Balance at October 31, 2021 $ 1,388 Reassessment of position (27) Balance at October 31, 2022 $ 1,361 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Share-based Payment Arrangement, Noncash Expense [Abstract] | |
Schedule of Nonvested Restricted Share Activity | A summary of non-vested restricted stock award activity during the years ended October 31, 2022, 2021 and 2020, follows: Restricted Stock Awards Weighted Average Non-vested at October 31, 2019 230,100 $ 17.02 Granted 63,400 18.82 Vested (55,000) 19.45 Forfeited (51,000) 17.30 Non-vested at October 31, 2020 187,500 16.82 Granted 73,300 20.68 Vested (44,400) 20.70 Forfeited — — Non-vested at October 31, 2021 216,400 17.28 Granted 84,400 22.54 Vested (88,700) 13.74 Forfeited — — Non-vested at October 31, 2022 212,100 $ 20.86 |
Schedule of Stock Option Activity | The following table summarizes our stock option activity for the years ended October 31, 2022, 2021 and 2020. Stock Options Weighted Average Weighted Average Aggregate Outstanding at October 31, 2019 1,416,186 $ 18.71 4.2 $ 1,449 Granted — — Exercised (215,733) 17.09 Forfeited/Expired (105,124) 20.28 Outstanding at October 31, 2020 1,095,329 $ 18.88 3.6 $ 561 Granted — — Exercised (865,393) 18.80 Forfeited/Expired (11,632) 18.22 Outstanding at October 31, 2021 218,304 $ 19.37 3.4 $ 297 Granted — — Exercised (35,600) 19.36 Forfeited/Expired (7,587) 19.04 Outstanding at October 31, 2022 175,117 $ 19.39 2.9 $ 485 Vested at October 31, 2022 175,117 $ 19.39 2.9 $ 485 Exercisable at October 31, 2022 175,117 $ 19.39 2.9 $ 485 |
Schedule of Valuation Assumptions and Fair Value for Stock Options | The following table summarizes our performance share grants and the grant date fair value for the RONA performance metric: Grant Date Shares Awarded Grant Date Fair Value Shares Forfeited December 5, 2019 55,900 $ 19.40 5,300 December 2, 2020 65,300 $ 20.68 — December 9, 2021 80,900 $ 22.54 — |
Share-based Compensation Arrangements by Share-based Payment Award, Performance-Based Units, Vested and Expected to 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% —% |
Share-based Payment Arrangement, Performance Shares, Outstanding Activity | 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 Grant Date Fair Value Shares Forfeited December 5, 2019 35,000 $ 19.40 — December 2, 2020 38,400 $ 20.68 — December 9, 2021 50,900 $ 21.06 — |
Schedule of Compensation Cost for Share-based Payment Arrangements, Allocation of Share-based Compensation Costs | The following table summarizes amounts expensed as selling, general and administrative expense related to restricted stock awards, stock options, restricted stock units, performance share awards and performance restricted stock units for the years ended October 31, 2022, 2021 and 2020 (in thousands): Year Ended October 31, 2022 2021 2020 Restricted stock awards $ 1,452 $ 1,235 $ 625 Stock options — — 10 Restricted stock units 1,167 1,197 186 Performance share awards 2,373 4,039 (170) Performance restricted stock units 840 729 515 Total compensation expense 5,832 7,200 1,166 Income tax effect 1,138 2,078 274 Net compensation expense $ 4,694 $ 5,122 $ 892 |
Other Income (Expense) (Tables)
Other Income (Expense) (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Other Income and Expenses [Abstract] | |
Schedule of Other Non-operating Income (Expense) | Other income included under the caption “Other, net” on the accompanying consolidated statements of income (loss), consisted of the following (in thousands): Year Ended October 31, 2022 2021 2020 Foreign currency transaction gains (losses) $ 386 $ (98) $ (42) Foreign currency exchange derivative gains (losses) 19 — (15) Pension service benefit 783 839 243 Interest income 19 5 28 Other (166) 8 66 Other income $ 1,041 $ 754 $ 280 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Segment Reporting [Abstract] | |
Segment Information | NA Fenestration EU Fenestration NA Cabinet Comp. Unallocated Corp. & Other Total Year Ended October 31, 2022 Net sales $ 687,458 $ 262,058 $ 275,704 $ (3,718) $ 1,221,502 Depreciation and amortization 16,253 9,674 13,830 352 40,109 Operating income (loss) 74,570 40,270 3,245 (6,804) 111,281 Capital expenditures 18,758 7,810 6,454 99 33,121 Total assets $ 279,139 $ 223,729 $ 176,154 $ 45,595 $ 724,617 Year Ended October 31, 2021 Net sales $ 578,332 $ 251,599 $ 246,075 $ (3,857) $ 1,072,149 Depreciation and amortization 18,730 10,373 13,263 366 42,732 Operating income (loss) 56,248 39,299 896 (14,573) 81,870 Capital expenditures 9,966 8,155 5,559 328 24,008 Total assets $ 268,773 $ 236,755 $ 178,671 $ 33,124 $ 717,323 Year Ended October 31, 2020 Net sales $ 483,415 $ 161,054 $ 210,099 $ (2,995) $ 851,573 Depreciation and amortization 23,555 9,468 13,732 474 47,229 Operating income (loss) 39,909 20,076 (2,502) (2,218) 55,265 Capital expenditures $ 15,761 $ 5,435 $ 4,423 $ 107 $ 25,726 The following table summarizes the change in the carrying amount of goodwill by segment for the years ended October 31, 2022 and 2021 (in thousands): NA Fenestration EU Fenestration NA Cabinet Comp. Unallocated Corp. & Other Total Balance as of October 31, 2020 $ 38,712 $ 68,295 $ 39,147 $ — $ 146,154 Foreign currency translation adjustment — 3,051 — — 3,051 Balance as of October 31, 2021 $ 38,712 $ 71,346 $ 39,147 $ — $ 149,205 Foreign currency translation adjustment — (11,350) — — (11,350) Balance as of October 31, 2022 $ 38,712 $ 59,996 $ 39,147 $ — $ 137,855 We did not allocate non-operating expense or income tax expense to the reportable segments. The following table reconciles operating income as reported above to net income for the years ended October 31, 2022, 2021 and 2020 (in thousands): Year Ended October 31, 2022 2021 2020 Operating income $ 111,281 $ 81,870 $ 55,265 Interest expense (2,559) (2,530) (5,245) Other, net 1,041 754 280 Income tax expense (21,427) (23,114) (11,804) Net income $ 88,336 $ 56,980 $ 38,496 |
Schedule of Product Sales | The following table summarizes our product sales for the three years ended October 31, 2022, 2021, and 2020 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 16, “Segment Information.” Year Ended October 31, 2022 2021 2020 (in thousands) NA Fenestration: United States - fenestration $ 609,572 $ 507,634 $ 427,616 International - fenestration 35,906 34,610 28,585 United States - non-fenestration 29,039 24,534 19,279 International - non-fenestration 12,941 11,554 7,935 $ 687,458 $ 578,332 $ 483,415 EU Fenestration: International - fenestration $ 194,854 $ 199,511 $ 134,432 International - non-fenestration 67,204 52,088 26,622 $ 262,058 $ 251,599 $ 161,054 NA Cabinet Components: United States - fenestration $ 17,696 $ 13,326 $ 11,842 United States - non-fenestration 254,726 230,559 196,479 International - non-fenestration 3,282 2,190 1,778 $ 275,704 $ 246,075 $ 210,099 Unallocated Corporate & Other: Eliminations $ (3,718) $ (3,857) $ (2,995) $ (3,718) $ (3,857) $ (2,995) Net sales $ 1,221,502 $ 1,072,149 $ 851,573 |
Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas | The following tables provide information concerning our net sales for the years ended October 31, 2022, 2021 and 2020, and our long-lived assets as of October 31, 2022 and 2021 (in thousands): Year Ended October 31, Net sales 2022 2021 2020 United States $ 911,180 $ 778,486 $ 654,802 Europe 255,400 244,308 158,831 Canada 31,442 25,007 18,213 Asia 15,021 18,445 11,504 Other foreign countries 8,459 5,903 8,223 Total net sales $ 1,221,502 $ 1,072,149 $ 851,573 October 31, Long-lived assets, net 2022 2021 United States $ 279,616 $ 291,282 Germany 41,669 25,513 United Kingdom 118,005 146,158 Total long-lived assets, net $ 439,290 $ 462,953 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Earnings Per Share [Abstract] | |
Earnings Per Share, Basic and Diluted | The computation of basic and diluted earnings per share for the years ended October 31, 2022, 2021 and 2020 follows (in thousands, except per share data): Year Ended October 31, 2022 Net Income Weighted Average Shares Per Share Basic earnings per common share $ 88,336 33,048 $ 2.67 Effect of dilutive securities: Stock options 25 Restricted stock awards 100 Performance restricted stock units 32 Diluted earnings per common share $ 88,336 33,205 $ 2.66 Year Ended October 31, 2021 Basic earnings per common share $ 56,980 33,193 $ 1.72 Effect of dilutive securities: Stock options 82 Restricted stock awards 132 Performance restricted stock units 88 Diluted earnings per common share $ 56,980 33,495 $ 1.70 Year Ended October 31, 2020 Basic earnings per common share $ 38,496 32,689 $ 1.18 Effect of dilutive securities: Stock options 10 Restricted stock awards 90 Performance restricted stock units 32 Diluted earnings per common share $ 38,496 32,821 $ 1.17 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following table shows anti-dilutive instruments for the three years ended October 31, 2022, 2021 and 2020 (shares in thousands): Year Ended October 31, 2022 2021 2020 Stock options — — 1,032 Restricted stock awards — — — Performance share awards — — — Total — — 1,032 |
Unaudited Quarterly Data (Table
Unaudited Quarterly Data (Tables) | 12 Months Ended |
Oct. 31, 2022 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Information | Selected quarterly financial data for the years ended October 31, 2022 and 2021 was as follows (amounts in thousands, except per share amounts): For the Quarter Ended January 31, 2022 April 30, 2022 July 31, 2022 October 31, 2022 Net sales $ 267,040 $ 322,893 $ 324,037 $ 307,532 Cost of sales (excluding depreciation and amortization) 211,834 249,651 251,446 240,073 Depreciation and amortization 10,257 10,563 9,734 9,555 Operating income 14,126 34,550 34,035 28,570 Net income 11,239 26,522 25,908 24,667 Basic earnings per share 0.34 0.80 0.79 0.75 Diluted earnings per share 0.34 0.80 0.78 0.75 Cash dividends paid per common share 0.08 0.08 0.08 0.08 For the Quarter Ended January 31, 2021 April 30, 2021 July 31, 2021 October 31, 2021 Net sales $ 230,147 $ 270,357 $ 279,877 $ 291,768 Cost of sales (excluding depreciation and amortization) 176,397 208,460 219,866 226,818 Depreciation and amortization 11,015 10,845 10,683 10,189 Operating income 11,835 21,380 21,562 27,093 Net income 7,852 14,551 13,679 20,898 Basic earnings per share 0.24 0.44 0.41 0.63 Diluted earnings per share 0.24 0.43 0.41 0.62 Cash dividends paid per common share 0.08 0.08 0.08 0.08 |
Nature of Operations, Basis o_4
Nature of Operations, Basis of Presentation and Significant Accounting Policies, Revenue from Contracts with Customers (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2022 | Jul. 31, 2022 | Apr. 30, 2022 | Jan. 31, 2022 | Oct. 31, 2021 | Jul. 31, 2021 | Apr. 30, 2021 | Jan. 31, 2021 | Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | $ 307,532 | $ 324,037 | $ 322,893 | $ 267,040 | $ 291,768 | $ 279,877 | $ 270,357 | $ 230,147 | $ 1,221,502 | $ 1,072,149 | $ 851,573 |
United States | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 911,180 | 778,486 | 654,802 | ||||||||
Operating Segments | NA Fenestration | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 687,458 | 578,332 | 483,415 | ||||||||
Operating Segments | EU Fenestration | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 262,058 | 251,599 | 161,054 | ||||||||
Operating Segments | NA Cabinet Components | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 275,704 | 246,075 | 210,099 | ||||||||
Intersegment Eliminations | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | (3,718) | (3,857) | (2,995) | ||||||||
Corporate, Non-segment | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | (3,718) | (3,857) | (2,995) | ||||||||
Fenestration | Operating Segments | NA Fenestration | United States | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 609,572 | 507,634 | 427,616 | ||||||||
Fenestration | Operating Segments | NA Fenestration | International | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 35,906 | 34,610 | 28,585 | ||||||||
Fenestration | Operating Segments | EU Fenestration | International | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 194,854 | 199,511 | 134,432 | ||||||||
Fenestration | Operating Segments | NA Cabinet Components | United States | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 17,696 | 13,326 | 11,842 | ||||||||
Non-fenestration | Operating Segments | NA Fenestration | United States | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 29,039 | 24,534 | 19,279 | ||||||||
Non-fenestration | Operating Segments | NA Fenestration | International | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 12,941 | 11,554 | 7,935 | ||||||||
Non-fenestration | Operating Segments | EU Fenestration | International | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 67,204 | 52,088 | 26,622 | ||||||||
Non-fenestration | Operating Segments | NA Cabinet Components | United States | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 254,726 | 230,559 | 196,479 | ||||||||
Non-fenestration | Operating Segments | NA Cabinet Components | International | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | $ 3,282 | $ 2,190 | $ 1,778 |
Nature of Operations, Basis o_5
Nature of Operations, Basis of Presentation and Significant Accounting Policies, Concentration (Details) - customer | 12 Months Ended | |
Oct. 31, 2022 | Oct. 31, 2021 | |
Sales | ||
Concentration Risk [Line Items] | ||
Number of major customers whose business, if lost, could adversely affect business | 1 | |
Net sales | Number of major customers whose business, if lost, could adversely affect business | ||
Concentration Risk [Line Items] | ||
Number of customers | 1 | 0 |
Net sales | One Customer | Number of major customers whose business, if lost, could adversely affect business | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 10% |
Nature of Operations, Basis o_6
Nature of Operations, Basis of Presentation and Significant Accounting Policies, Long Lived Assets (Details) | 12 Months Ended |
Oct. 31, 2022 | |
Land Improvements | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 7 years |
Land Improvements | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 25 years |
Building | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 25 years |
Building | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 40 years |
Building Improvements | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 5 years |
Building Improvements | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 20 years |
Machinery and Equipment | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 2 years |
Machinery and Equipment | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 15 years |
Nature of Operations, Basis o_7
Nature of Operations, Basis of Presentation and Significant Accounting Policies, Goodwill (Details) | Aug. 31, 2020 reporting_unit |
Goodwill [Line Items] | |
Number of Reporting Units | 5 |
Number Of Reporting Units, Performed Quantitative Assessment | 3 |
NA Cabinet Components | |
Goodwill [Line Items] | |
Number of Reporting Units | 1 |
Reporting Unit, Percentage of Fair Value in Excess of Carrying Amount | 12% |
EU Fenestration | |
Goodwill [Line Items] | |
Number of Reporting Units | 2 |
Number Of Reporting Units, Performed Quantitative Assessment | 2 |
Reporting Unit, Percentage of Fair Value in Excess of Carrying Amount | 384.90% |
NA Fenestration | |
Goodwill [Line Items] | |
Number of Reporting Units | 2 |
Number Of Reporting Units, Performed Quantitative Assessment | 1 |
Nature of Operations, Basis o_8
Nature of Operations, Basis of Presentation and Significant Accounting Policies, Stock-Based Compensation (Details) | 12 Months Ended |
Oct. 31, 2022 shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Vesting period | 3 years |
Performance Shares | |
Class of Stock [Line Items] | |
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding, Number | 101,200 |
Performance Restricted Stock Units | |
Class of Stock [Line Items] | |
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding, Number | 32,680 |
Stock options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Vesting period | 3 years |
Restricted stock | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Vesting period | 3 years |
Performance Shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Vesting period | 3 years |
Restricted Stock Units (RSUs) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Vesting period | 3 years |
Nature of Operations, Basis o_9
Nature of Operations, Basis of Presentation and Significant Accounting Policies, Cash Flow (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Cash paid for interest | $ 1,982 | $ 1,993 | $ 4,715 |
Cash paid for income taxes | 26,410 | 22,160 | 12,118 |
Cash received for income tax refunds | 2,235 | 381 | 352 |
(Decrease) increase in capitalized expenditures in accounts payable | $ (1,692) | $ 1,124 | $ 2,370 |
Nature of Operations, Basis _10
Nature of Operations, Basis of Presentation and Significant Accounting Policies, Related Party Transactions (Details) $ in Thousands | 12 Months Ended |
Oct. 31, 2022 USD ($) | |
Related Party Transaction [Line Items] | |
Revenue from Related Parties | $ 1,900 |
No single transaction or series of related transactions exceeded $120,000 | |
Related Party Transaction [Line Items] | |
Revenue from Related Parties | $ 120 |
Receivables & Allowance (Detail
Receivables & Allowance (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | Oct. 31, 2018 | |
Receivables [Abstract] | ||||
Trade receivables | $ 95,851 | $ 107,725 | ||
Other | 456 | 924 | ||
Accounts receivable, gross | 96,307 | 108,649 | ||
Allowance for accounts receivable | 289 | 340 | $ 161 | $ 393 |
Accounts receivable, net | 96,018 | 108,309 | ||
Allowance for Doubtful Accounts Receivable [Roll Forward] | ||||
Allowance for accounts receivable | 340 | 161 | ||
Current period provision for expected credit losses | 314 | 267 | 262 | |
Amounts written off | (299) | (88) | (494) | |
Recoveries | 10 | 0 | 0 | |
Allowance for accounts receivable | $ 289 | $ 340 | $ 161 |
Inventories (Detail)
Inventories (Detail) - USD ($) $ in Thousands | 12 Months Ended | |||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | Oct. 31, 2018 | |
Inventory, Net [Abstract] | ||||
Raw materials | $ 68,455 | $ 49,867 | ||
Finished goods and work in process | 54,013 | 43,499 | ||
Supplies and other | 1,551 | 2,099 | ||
Total | 124,019 | 95,465 | ||
Inventory reserves | 3,129 | 2,936 | $ 6,484 | $ 3,790 |
Inventories, net | 120,890 | 92,529 | ||
Inventory Reserve Rollforward | ||||
Inventory reserves, beginning balance | 2,936 | 6,484 | ||
Charged (credited) to costs & expenses | 494 | (568) | 2,713 | |
Write-offs | (133) | (3,060) | 0 | |
Other | 168 | (80) | 19 | |
Inventory reserves, ending balance | $ 3,129 | $ 2,936 | $ 6,484 |
Property, Plant & and Equipme_2
Property, Plant & and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |||
Land and land improvements | $ 10,702 | $ 10,285 | |
Buildings and building improvements | 105,696 | 101,740 | |
Machinery and equipment | 384,023 | 386,996 | |
Construction in progress | 28,507 | 16,102 | |
Property, plant and equipment, gross | 528,928 | 515,123 | |
Less: Accumulated depreciation | (348,528) | (336,493) | |
Property, plant and equipment, net | 180,400 | 178,630 | |
Depreciation | $ 26,900 | $ 28,800 | $ 31,800 |
Leases (Details)
Leases (Details) - USD ($) | 12 Months Ended | |
Oct. 31, 2022 | Oct. 31, 2021 | |
Lessee, Lease, Description [Line Items] | ||
Operating lease right-of-use assets | $ 56,000,000 | $ 52,708,000 |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Property, plant and equipment, net of accumulated depreciation of $348,528 and $336,493 | Property, plant and equipment, net of accumulated depreciation of $348,528 and $336,493 |
Finance Lease, Right-of-Use Asset, after Accumulated Amortization | $ 22,003,000 | $ 16,921,000 |
Leases, Right-of-Use Asset | 78,003,000 | 69,629,000 |
Current operating lease liabilities | 7,727,000 | 8,196,000 |
Finance Lease, Liability, Current | 1,336,000 | 1,114,000 |
Noncurrent operating lease liabilities | $ 49,286,000 | $ 45,367,000 |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Long-term debt | Long-term debt |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | $ 17,816,000 | $ 14,335,000 |
Leases, Liability | $ 76,165,000 | $ 69,012,000 |
Operating Lease, Weighted Average Remaining Lease Term | 10 years 9 months 18 days | 7 years 8 months 12 days |
Finance Lease, Weighted Average Remaining Lease Term | 13 years 8 months 12 days | 15 years 1 month 6 days |
Operating Lease, Weighted Average Discount Rate, Percent | 3.84% | 3.23% |
Finance Lease, Weighted Average Discount Rate, Percent | 3.78% | 3.72% |
Finance Lease, Liability | $ 19,150,000 | |
Finance Lease, Right-of-Use Asset, Accumulated Amortization | $ 3,726,000 | $ 2,300,000 |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Current maturities of long-term debt | Current maturities of long-term debt |
Operating lease right-of-use assets | $ 56,000,000 | $ 52,708,000 |
Finance Lease, Right-of-Use Asset, after Accumulated Amortization | 22,003,000 | 16,921,000 |
Leases, Right-of-Use Asset | 78,003,000 | 69,629,000 |
Current operating lease liabilities | 7,727,000 | 8,196,000 |
Finance Lease, Liability, Current | 1,336,000 | 1,114,000 |
Noncurrent operating lease liabilities | 49,286,000 | 45,367,000 |
Leases, Liability | 76,165,000 | 69,012,000 |
Operating Lease, Cost | 9,934,000 | 10,125,000 |
Finance Lease, Right-of-Use Asset, Amortization | 1,332,000 | 1,165,000 |
Finance Lease, Interest Expense | 583,000 | 561,000 |
Variable Lease, Cost | 977,000 | 983,000 |
Lease, Cost | 12,826,000 | 12,834,000 |
Finance Lease, Principal Payments | 1,162 | 1,003 |
Finance Lease, Interest Payment on Liability | 583 | 561 |
Operating Lease, Payments | 9,955 | 9,621 |
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability | 13,872 | 8,737 |
Right-of-Use Asset Obtained in Exchange for Finance Lease Liability | $ 6,467 | $ 469 |
Operating Lease, Weighted Average Remaining Lease Term | 10 years 9 months 18 days | 7 years 8 months 12 days |
Finance Lease, Weighted Average Remaining Lease Term | 13 years 8 months 12 days | 15 years 1 month 6 days |
Operating Lease, Weighted Average Discount Rate, Percent | 3.84% | 3.23% |
Finance Lease, Weighted Average Discount Rate, Percent | 3.78% | 3.72% |
Lessee, Operating Lease, Liability, to be Paid, Year One | $ 9,668,000 | |
Lessee, Operating Lease, Liability, to be Paid, Year Two | 8,920,000 | |
Lessee, Operating Lease, Liability, to be Paid, Year Three | 7,213,000 | |
Lessee, Operating Lease, Liability, to be Paid, Year Four | 6,229,000 | |
Lessee, Operating Lease, Liability, to be Paid, Year Five | 5,589,000 | |
Lessee, Operating Lease, Liability, to be Paid, after Year Five | 33,769,000 | |
Lessee, Operating Lease, Liability, to be Paid | 71,388,000 | |
Lessee, Operating Lease, Liability, Undiscounted Excess Amount | 14,378,000 | |
Operating Lease, Liability | 57,010,000 | |
Finance Lease, Liability, to be Paid, Year One | 2,027,000 | |
Finance Lease, Liability, to be Paid, Year Two | 1,980,000 | |
Finance Lease, Liability, to be Paid, Year Three | 1,922,000 | |
Finance Lease, Liability, to be Paid, Year Four | 1,807,000 | |
Finance Lease, Liability, to be Paid, Year Five | 1,709,000 | |
Finance Lease, Liability, to be Paid, after Year Five | 15,123,000 | |
Finance Lease, Liability, Payment, Due | 24,568,000 | |
Finance Lease, Liability, Undiscounted Excess Amount | 5,418,000 | |
Finance Lease, Liability | $ 19,150,000 | |
Equipment and Vehicles | Minimum | ||
Lessee, Lease, Description [Line Items] | ||
Term | 1 year | |
Equipment and Vehicles | Maximum | ||
Lessee, Lease, Description [Line Items] | ||
Term | 10 years | |
Real Estate-Related Leases | Minimum | ||
Lessee, Lease, Description [Line Items] | ||
Term | 5 years | |
Real Estate-Related Leases | Maximum | ||
Lessee, Lease, Description [Line Items] | ||
Term | 20 years |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets (Detail) | 12 Months Ended | ||
Oct. 31, 2022 USD ($) unit | Oct. 31, 2021 USD ($) | Oct. 31, 2020 USD ($) | |
Goodwill [Roll Forward] | |||
Beginning balance | $ 149,205,000 | $ 146,154,000 | |
Foreign currency translation adjustment | (11,350,000) | 3,051,000 | |
Ending balance | $ 137,855,000 | 149,205,000 | $ 146,154,000 |
Finite-Lived Intangible Assets [Line Items] | |||
Number of reportable units with goodwill balances | unit | 5 | ||
Goodwill | $ 137,855,000 | 149,205,000 | 146,154,000 |
Gross Carrying Amount | 216,386,000 | 225,169,000 | |
Accumulated Amortization | (151,351,000) | (142,759,000) | |
Intangible assets amortization expense | 11,900,000 | 12,800,000 | 14,300,000 |
Impairment of intangible assets | 0 | 0 | $ 0 |
Estimated Amortization Expense | |||
2018 | 10,908,000 | ||
2019 | 10,156,000 | ||
2020 | 8,930,000 | ||
2021 | 8,855,000 | ||
2022 | 8,856,000 | ||
Thereafter | 17,330,000 | ||
Intangible assets, net | $ 65,035,000 | 82,410,000 | |
Customer relationships | |||
Finite-Lived Intangible Assets [Line Items] | |||
Remaining Weighted Average Useful Life | 8 years | ||
Gross Carrying Amount | $ 139,607,000 | 146,207,000 | |
Accumulated Amortization | (88,646,000) | (81,086,000) | |
Retirement of fully amortized intangible assets | $ 0 | 9,900,000 | |
Trademarks and trade names | |||
Finite-Lived Intangible Assets [Line Items] | |||
Remaining Weighted Average Useful Life | 7 years | ||
Gross Carrying Amount | $ 54,389,000 | 56,437,000 | |
Accumulated Amortization | $ (40,610,000) | (39,589,000) | |
Patents and other technology | |||
Finite-Lived Intangible Assets [Line Items] | |||
Remaining Weighted Average Useful Life | 5 years | ||
Gross Carrying Amount | $ 22,390,000 | 22,525,000 | |
Accumulated Amortization | (22,095,000) | (22,084,000) | |
Woodcraft | |||
Goodwill [Roll Forward] | |||
Ending balance | 39,200,000 | ||
Finite-Lived Intangible Assets [Line Items] | |||
Goodwill | $ 39,200,000 | ||
NA Fenestration | |||
Finite-Lived Intangible Assets [Line Items] | |||
Number of reportable units with goodwill balances | unit | 2 | ||
NA Engineered Components Unit One | |||
Goodwill [Roll Forward] | |||
Ending balance | $ 35,900,000 | ||
Finite-Lived Intangible Assets [Line Items] | |||
Goodwill | 35,900,000 | ||
NA Engineered Components Unit Three | |||
Goodwill [Roll Forward] | |||
Ending balance | 2,800,000 | ||
Finite-Lived Intangible Assets [Line Items] | |||
Goodwill | 2,800,000 | ||
EU Fenestration | |||
Goodwill [Roll Forward] | |||
Foreign currency translation adjustment | $ (11,350,000) | $ 3,051,000 | |
Finite-Lived Intangible Assets [Line Items] | |||
Number of reportable units with goodwill balances | unit | 2 | ||
EU Engineered Components Unit One [Member] | |||
Goodwill [Roll Forward] | |||
Ending balance | $ 45,100,000 | ||
Finite-Lived Intangible Assets [Line Items] | |||
Goodwill | 45,100,000 | ||
EU Engineered Components Unit Two [Member] | |||
Goodwill [Roll Forward] | |||
Ending balance | 14,900,000 | ||
Finite-Lived Intangible Assets [Line Items] | |||
Goodwill | $ 14,900,000 | ||
NA Cabinet Components | |||
Finite-Lived Intangible Assets [Line Items] | |||
Number of reportable units with goodwill balances | unit | 1 |
Accrued Liabilities (Details)
Accrued Liabilities (Details) - USD ($) $ in Thousands | Oct. 31, 2022 | Oct. 31, 2021 |
Accrued Liabilities [Abstract] | ||
Payroll, payroll taxes and employee benefits | $ 23,878 | $ 30,039 |
Accrued insurance and workers compensation | 7,232 | 6,340 |
Sales allowances | 7,456 | 8,590 |
Deferred compensation (current portion) | 0 | 395 |
Deferred revenue | 792 | 627 |
Warranties | 13 | 77 |
Audit, legal, and other professional fees | 3,136 | 1,886 |
Accrued taxes | 2,864 | 3,258 |
Other | 6,743 | 4,944 |
Accrued liabilities | $ 52,114 | $ 56,156 |
Debt and Capital Lease Obliga_3
Debt and Capital Lease Obligations - Schedule of Debt Obligations (Details) - USD ($) $ in Thousands | Oct. 31, 2022 | Oct. 31, 2021 |
Debt Instrument [Line Items] | ||
Debt and Capital Lease Obligations | $ 30,674 | $ 52,940 |
Debt Instrument, Unamortized Discount (Premium), Net | 1,528 | 597 |
Less: Current maturities of long-term debt | 1,046 | 846 |
Long-term debt | 29,628 | 52,094 |
Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Debt and Capital Lease Obligations | 13,000 | 38,000 |
Capital Lease Obligations And Other | ||
Debt Instrument [Line Items] | ||
Debt and Capital Lease Obligations | $ 19,202 | $ 15,537 |
Debt and Capital Lease Obliga_4
Debt and Capital Lease Obligations - Narrative (Details) - USD ($) | 12 Months Ended | |||
Jul. 06, 2022 | Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Debt Instrument [Line Items] | ||||
Debt Instrument, Unamortized Discount (Premium), Net | $ (1,528,000) | $ (597,000) | ||
Letters of credit, outstanding | 5,000,000 | |||
Debt and capital lease obligations | 30,674,000 | $ 52,940,000 | ||
Credit facility, amount available | $ 307,000,000 | |||
Debt instrument, interest rate during period | 2.16% | 1.42% | ||
Payments of Debt Issuance Costs | $ 1,210,000 | $ 0 | $ 0 | |
Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Debt and capital lease obligations | $ 13,000,000 | $ 38,000,000 | ||
Term Loan Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate, stated percentage | 5.08% | |||
Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Payments of Debt Issuance Costs | $ 1,200,000 | |||
Revolving Credit Facility | Line of Credit | ||||
Debt Instrument [Line Items] | ||||
Debt Instrument, Term | 5 years | |||
Margin on base rate | 1.25% | |||
Line of Credit Facility, Maximum Borrowing Capacity, Committed Amount | $ 325,000,000 | |||
Credit Agreement | Line of Credit | ||||
Debt Instrument [Line Items] | ||||
Secured leverage ratio | 3.25 | |||
LIBOR stipulation (less than) | 2% | |||
Minimum incremental borrowing | $ 10,000,000 | |||
Maximum incremental borrowing | 150,000,000 | |||
Debt instrument, limitation on annual dividend | $ 25,000,000 | |||
Debt Instrument, Leverage Ratio Threshold for Limitations to Take Effect | 2.75 | |||
Debt Instrument, Liquidity Threshold for Limitations to Take Effect | $ 25,000,000 | |||
Required coverage ratio | 3 | |||
Credit Agreement | Line of Credit | Less than or equal to 1.50 to 1.00 | ||||
Debt Instrument [Line Items] | ||||
Commitment fee | 0.15% | |||
Credit Agreement | Line of Credit | Greater than 3.00 to 1.00 | ||||
Debt Instrument [Line Items] | ||||
Commitment fee | 0.25% | |||
Swing Line [Member] | Line of Credit | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, unused borrowing capacity, amount | $ 15,000,000 | |||
Base Rate | Credit Agreement | Line of Credit | Less than or equal to 1.50 to 1.00 | ||||
Debt Instrument [Line Items] | ||||
Margin on base rate | 0.25% | |||
Base Rate | Credit Agreement | Line of Credit | Greater than 3.00 to 1.00 | ||||
Debt Instrument [Line Items] | ||||
Margin on base rate | 1% | |||
London Interbank Offered Rate (LIBOR) | Credit Agreement | Line of Credit | Less than or equal to 1.50 to 1.00 | ||||
Debt Instrument [Line Items] | ||||
Margin on base rate | 1.25% | |||
London Interbank Offered Rate (LIBOR) | Credit Agreement | Line of Credit | Greater than 3.00 to 1.00 | ||||
Debt Instrument [Line Items] | ||||
Margin on base rate | 2% |
Debt and Capital Lease Obliga_5
Debt and Capital Lease Obligations - Schedule of Applicable Margins and Commitment Fees (Details) - Credit Agreement - Line of Credit | 12 Months Ended |
Oct. 31, 2022 | |
Less than or equal to 1.50 to 1.00 | |
Debt Instrument [Line Items] | |
Commitment Fee | 0.15% |
Less than or equal to 1.50 to 1.00 | LIBOR Rate Loans | |
Debt Instrument [Line Items] | |
Margin on base rate | 1.25% |
Less than or equal to 1.50 to 1.00 | Base Rate Loans | |
Debt Instrument [Line Items] | |
Margin on base rate | 0.25% |
Greater than 1.50 to 1.00, but less than or equal to 2.25 to 1.00 | |
Debt Instrument [Line Items] | |
Commitment Fee | 0.175% |
Greater than 1.50 to 1.00, but less than or equal to 2.25 to 1.00 | LIBOR Rate Loans | |
Debt Instrument [Line Items] | |
Margin on base rate | 1.50% |
Greater than 1.50 to 1.00, but less than or equal to 2.25 to 1.00 | Base Rate Loans | |
Debt Instrument [Line Items] | |
Margin on base rate | 0.50% |
Greater than 2.25 to 1.00, but less than or equal to 3.00 to 1.00 | |
Debt Instrument [Line Items] | |
Commitment Fee | 0.20% |
Greater than 2.25 to 1.00, but less than or equal to 3.00 to 1.00 | LIBOR Rate Loans | |
Debt Instrument [Line Items] | |
Margin on base rate | 1.75% |
Greater than 2.25 to 1.00, but less than or equal to 3.00 to 1.00 | Base Rate Loans | |
Debt Instrument [Line Items] | |
Margin on base rate | 0.75% |
Greater than 3.00 to 1.00 | |
Debt Instrument [Line Items] | |
Commitment Fee | 0.25% |
Greater than 3.00 to 1.00 | LIBOR Rate Loans | |
Debt Instrument [Line Items] | |
Margin on base rate | 2% |
Greater than 3.00 to 1.00 | Base Rate Loans | |
Debt Instrument [Line Items] | |
Margin on base rate | 1% |
Debt and Capital Lease Obliga_6
Debt and Capital Lease Obligations - Schedule of Debt Maturities (Details) - USD ($) $ in Thousands | Oct. 31, 2022 | Oct. 31, 2021 |
Revolving Credit Facility | ||
2023 | $ 0 | |
2024 | 0 | |
2025 | 0 | |
2026 | 0 | |
2027 | 13,000 | |
Thereafter | 0 | |
Debt and Capital Lease Obligations | 30,674 | $ 52,940 |
Finance Leases and Other Obligations | ||
2023 | 2,065 | |
2024 | 1,992 | |
2025 | 1,922 | |
2026 | 1,807 | |
2027 | 1,709 | |
Thereafter | 15,125 | |
Total debt payments | 24,620 | |
Total, Capital Lease Obligations | 19,202 | |
Aggregate Maturities | ||
2023 | 2,065 | |
2024 | 1,992 | |
2025 | 1,922 | |
2026 | 1,807 | |
2027 | 14,709 | |
Thereafter | 15,125 | |
Long-term debt | 37,620 | |
Total | 32,202 | |
Finance Lease, Liability, Undiscounted Excess Amount | $ (5,418) |
Retirement Plans (Detail)
Retirement Plans (Detail) | 12 Months Ended | 22 Months Ended | 24 Months Ended | ||
Oct. 31, 2022 USD ($) plan | Oct. 31, 2021 USD ($) | Oct. 31, 2020 USD ($) | Oct. 31, 2022 USD ($) plan | Jan. 01, 2020 | |
Defined Benefit Plan, Change in Benefit Obligation [Roll Forward] | |||||
Projected benefit obligation | $ 42,379,000 | $ 44,825,000 | |||
Service cost | 860,000 | 850,000 | $ 1,262,000 | ||
Interest cost | 806,000 | 756,000 | 1,139,000 | ||
Actuarial loss | (6,944,000) | (849,000) | |||
Benefits paid | (349,000) | (359,000) | |||
Administrative expenses | (604,000) | (732,000) | |||
Settlements | (3,619,000) | (2,112,000) | |||
Projected benefit obligation | 32,529,000 | 42,379,000 | 44,825,000 | $ 32,529,000 | |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | |||||
Fair value of plan assets | 28,612,000 | 37,642,000 | 34,120,000 | 28,612,000 | |
Actual return on plan assets | (4,458,000) | 6,225,000 | |||
Employer contributions | 0 | 500,000 | 3,700,000 | ||
Benefits paid | (349,000) | (359,000) | |||
Administrative expenses | (604,000) | (732,000) | |||
Settlements | (3,619,000) | (2,112,000) | |||
Noncurrent liability - Funded Status | (3,917,000) | (4,737,000) | (3,917,000) | ||
Accumulated other comprehensive income (loss), net gains (losses), before tax | 3,600,000 | 4,500,000 | 3,600,000 | ||
Aggregate accumulated benefit obligation | 32,500,000 | 42,400,000 | $ 32,500,000 | ||
Net periodic benefit cost: | |||||
Service cost | 860,000 | 850,000 | 1,262,000 | ||
Interest cost | 806,000 | 756,000 | $ 1,139,000 | ||
Defined Benefit Plan, Net Periodic Benefit (Cost) Credit, Expected Return (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Other, net | ||||
Expected return on plan assets | (1,991,000) | (1,960,000) | $ (2,006,000) | ||
Amortization of net loss | 6,000 | 143,000 | $ 162,000 | ||
Defined Benefit Plan, Net Periodic Benefit Cost (Credit) Excluding Service Cost, Statement of Income or Comprehensive Income [Extensible Enumeration] | Other, net | ||||
Defined Benefit Plan, Net Periodic Benefit (Cost) Credit, Curtailment Gain (Loss), Statement of Income or Comprehensive Income [Extensible List] | Other, net | ||||
Settlements | (396,000) | (222,000) | $ (462,000) | ||
Net periodic benefit cost | 77,000 | 11,000 | 1,019,000 | ||
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, before Tax [Abstract] | |||||
Net (gain) loss arising during the period | (495,000) | (5,112,000) | 2,141,000 | ||
Less: Amortization of net loss | 6,000 | 143,000 | 162,000 | ||
Less: Curtailments | 0 | 0 | 1,141,000 | ||
Settlements | (396,000) | (222,000) | (462,000) | ||
Total recognized in other comprehensive (income) loss | $ (897,000) | $ (5,477,000) | $ 376,000 | ||
Defined Benefit Plan, Assumptions Used in Calculations [Abstract] | |||||
Benefit Obligation, Discount rate | 5.36% | 2.77% | 3.22% | 5.36% | |
Benefit Obligation, Rate of compensation increase | 0% | 0% | 0% | 0% | |
Net Periodic Benefit Cost, Discount rate | 2.77% | 2.60% | 3.10% | ||
Net Periodic Benefit Cost, Rate of compensation increase | 0% | 0% | 0% | ||
Net Periodic Benefit Cost, Expected long-term return on assets | 5.50% | 6% | 6.50% | ||
Fair value of plan assets | $ 28,612,000 | $ 37,642,000 | $ 34,120,000 | $ 28,612,000 | |
Employer contributions | 0 | 500,000 | 3,700,000 | ||
Fiscal Year Maturity [Abstract] | |||||
2023 | 22,880,000 | 22,880,000 | |||
2024 | 729,000 | 729,000 | |||
2025 | 770,000 | 770,000 | |||
2026 | 750,000 | 750,000 | |||
2027 | 704,000 | 704,000 | |||
2028 - 2032 | 3,415,000 | 3,415,000 | |||
Total | $ 29,248,000 | $ 29,248,000 | |||
Number Of Defined Contribution Plans | plan | 2 | 2 | |||
Defined Contribution Plan, Employer Matching Contribution, Percent of Match | 100% | 50% | |||
Employer matching contribution, percent of employees' gross pay | 5% | 5% | |||
Employer discretionary contribution amount | $ 6,800,000 | 6,300,000 | $ 4,800,000 | ||
Supplemental benefit plan liability | 1,900,000 | 2,900,000 | $ 1,900,000 | ||
Deferred compensation liability | 3,300,000 | 3,400,000 | $ 3,300,000 | ||
Defined Benefit Plan, Benefit Obligation, (Increase) Decrease for Settlement | (3,619,000) | (2,112,000) | |||
NA Cabinet Components | |||||
Fiscal Year Maturity [Abstract] | |||||
Employer matching contribution, percent of employees' gross pay | 4% | ||||
Money market fund | |||||
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | |||||
Fair value of plan assets | 22,508,000 | 300,000 | $ 22,508,000 | ||
Defined Benefit Plan, Assumptions Used in Calculations [Abstract] | |||||
Fair value of plan assets | 22,508,000 | 300,000 | 22,508,000 | ||
Equity securities | |||||
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | |||||
Fair value of plan assets | $ 0 | $ 18,952,000 | $ 0 | ||
Defined Benefit Plan, Assumptions Used in Calculations [Abstract] | |||||
Target Allocation | 0% | 0% | |||
Actual Allocation | 0% | 51% | 0% | ||
Fair value of plan assets | $ 0 | $ 18,952,000 | $ 0 | ||
Large capitalization | |||||
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | |||||
Fair value of plan assets | 0 | 8,231,000 | 0 | ||
Defined Benefit Plan, Assumptions Used in Calculations [Abstract] | |||||
Fair value of plan assets | 0 | 8,231,000 | 0 | ||
Small capitalization | |||||
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | |||||
Fair value of plan assets | 0 | 1,493,000 | 0 | ||
Defined Benefit Plan, Assumptions Used in Calculations [Abstract] | |||||
Fair value of plan assets | 0 | 1,493,000 | 0 | ||
International equity | |||||
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | |||||
Fair value of plan assets | 0 | 6,992,000 | 0 | ||
Defined Benefit Plan, Assumptions Used in Calculations [Abstract] | |||||
Fair value of plan assets | 0 | 6,992,000 | 0 | ||
Other | |||||
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | |||||
Fair value of plan assets | 0 | 2,236,000 | 0 | ||
Defined Benefit Plan, Assumptions Used in Calculations [Abstract] | |||||
Fair value of plan assets | 0 | 2,236,000 | 0 | ||
Fixed income | |||||
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | |||||
Fair value of plan assets | $ 6,104,000 | $ 18,390,000 | $ 6,104,000 | ||
Defined Benefit Plan, Assumptions Used in Calculations [Abstract] | |||||
Target Allocation | 100% | 100% | |||
Actual Allocation | 100% | 49% | 100% | ||
Fair value of plan assets | $ 6,104,000 | $ 18,390,000 | $ 6,104,000 | ||
High-quality core bond | |||||
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | |||||
Fair value of plan assets | 4,980,000 | 13,787,000 | 4,980,000 | ||
Defined Benefit Plan, Assumptions Used in Calculations [Abstract] | |||||
Fair value of plan assets | 4,980,000 | 13,787,000 | 4,980,000 | ||
High-quality government bond | |||||
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | |||||
Fair value of plan assets | 547,000 | 2,301,000 | 547,000 | ||
Defined Benefit Plan, Assumptions Used in Calculations [Abstract] | |||||
Fair value of plan assets | 547,000 | 2,301,000 | 547,000 | ||
High-yield bond | |||||
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | |||||
Fair value of plan assets | 577,000 | 2,302,000 | 577,000 | ||
Defined Benefit Plan, Assumptions Used in Calculations [Abstract] | |||||
Fair value of plan assets | $ 577,000 | $ 2,302,000 | $ 577,000 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Current | |||
Federal | $ 11,553 | $ 10,993 | $ 6,043 |
State and local | 740 | 3,447 | 1,505 |
Non-United States | 7,037 | 6,889 | 4,445 |
Total current | 19,330 | 21,329 | 11,993 |
Deferred | |||
Federal | 2,127 | (842) | (64) |
State and local | (229) | (277) | (315) |
Non-United States | 199 | 2,904 | 190 |
Total deferred | 2,097 | 1,785 | (189) |
Total income tax expense | 21,427 | 23,114 | 11,804 |
Domestic | 64,850 | 36,879 | 26,229 |
Foreign | 44,913 | 43,215 | 24,071 |
Total income before income taxes | $ 109,763 | $ 80,094 | $ 50,300 |
Effective Income Tax Rate Reconciliation, Percent [Abstract] | |||
United States tax at statutory rate | 21% | 21% | 21% |
State and local income tax | 0.40% | 3.10% | 1.70% |
Non-United States income tax | (0.80%) | 2.30% | 1.20% |
U.K. patent box benefit | (1.20%) | (1.40%) | (2.00%) |
U.S. income tax credits | (3.20%) | (4.20%) | (2.30%) |
Net U.S. tax on non-United States earnings | 3.20% | 4.20% | 2.50% |
Non-cash compensation | (1.70%) | 1.90% | (0.30%) |
Effective Income Tax Rate Reconciliation, Other Adjustments, Percent | 1.80% | 2% | 1.70% |
Effective tax rate | 19.50% | 28.90% | 23.50% |
Deferred tax assets: | |||
Employee benefit obligations | $ 8,046 | $ 7,591 | |
Accrued liabilities and reserves | 1,430 | 1,425 | |
Pension and other benefit obligations | 1,426 | 1,934 | |
Inventory | 1,409 | 894 | |
Loss and tax credit carry forwards | 1,589 | 1,857 | |
Other | 0 | 107 | |
Total gross deferred tax assets | 13,900 | 13,808 | |
Less: Valuation allowance | 534 | 1,174 | |
Total deferred tax assets, net of valuation allowance | 13,366 | 12,634 | |
Deferred tax liabilities: | |||
Property, plant and equipment | 15,467 | 11,187 | |
Goodwill and intangibles | 20,162 | 23,412 | |
Deferred Tax Liabilities, Other | 14 | 0 | |
Total deferred tax liabilities | 35,643 | 34,599 | |
Net deferred tax liabilities | 22,277 | 21,965 | |
Unrecognized Tax Benefits [Roll Forward] | |||
Unrecognized Tax Benefits | 1,388 | 522 | $ 556 |
Additions for tax positions related to the prior year | 953 | 15 | |
Reassessment of position | (27) | (87) | (49) |
Unrecognized Tax Benefits | 1,361 | 1,388 | 522 |
Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items] | |||
Unrecognized Tax Benefits, Reduction Resulting from Lapse of Applicable Statute of Limitations | $ 27 | $ 87 | $ 49 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Income Tax Examination [Line Items] | |||
Operating loss carryforwards | $ 31,300 | ||
United States tax at statutory rate | 21% | 21% | 21% |
Liability for uncertain tax positions | $ 1,361 | $ 1,388 | |
Foreign earnings repatriated | 19,800 | 15,100 | |
State | |||
Income Tax Examination [Line Items] | |||
Operating loss carryforwards, valuation allowance | $ 500 | $ 1,200 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Millions | 12 Months Ended | |
Oct. 31, 2022 | Oct. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Amount purchased under purchase obligations | $ 11 | $ 9.9 |
Purchased obligation amount due within the next fiscal year | $ 7.6 | $ 23.4 |
Deprecation and accretion period | 7 years | |
Cumulative asset retirement obligation | $ 2.3 |
Stock Based Compensation (Detai
Stock Based Compensation (Detail) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||||||
Dec. 09, 2021 | Dec. 02, 2020 | Dec. 05, 2019 | Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | Oct. 31, 2019 | |
Stock Options, [Roll Forward] | |||||||
Outstanding at beginning of period (in shares) | 218,304 | 1,095,329 | 1,416,186 | ||||
Granted (in shares) | 0 | 0 | 0 | ||||
Exercised (in shares) | (35,600) | (865,393) | (215,733) | ||||
Forfeited/Expired (in shares) | (7,587) | (11,632) | (105,124) | ||||
Outstanding at end of period (in shares) | 175,117 | 218,304 | 1,095,329 | 1,416,186 | |||
Vested or expected to vest at end of period | 175,117 | ||||||
Exercisable at end of period | 175,117 | ||||||
Weighted Average Exercise Price Per Share | |||||||
Outstanding at beginning of period (in dollars per share) | $ 19.37 | $ 18.88 | $ 18.71 | ||||
Granted (in dollars per share) | 0 | 0 | 0 | ||||
Exercised (in dollars per share) | 19.36 | 18.80 | 17.09 | ||||
Forfeited/Expired (in dollars per share) | 19.04 | 18.22 | 20.28 | ||||
Outstanding at end of period (in dollars per share) | 19.39 | $ 19.37 | $ 18.88 | $ 18.71 | |||
Vested or expected to vest at end of period | 19.39 | ||||||
Exercisable at end of period | $ 19.39 | ||||||
Weighted Average Remaining Contractual Life | |||||||
Outstanding at end of period | 2 years 10 months 24 days | 3 years 4 months 24 days | 3 years 7 months 6 days | 4 years 2 months 12 days | |||
Vested or expected to vest at end of period | 2 years 10 months 24 days | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Exercisable, Aggregate Intrinsic Value | $ 485 | ||||||
Aggregate Intrinsic Value | |||||||
Outstanding at end of period | 485 | $ 297 | $ 561 | $ 1,449 | |||
Vested or expected to vest at end of period | $ 485 | ||||||
Additional Disclosures [Abstract] | |||||||
Number of shares authorized, originally | 3,139,895 | ||||||
Vesting period | 3 years | ||||||
Total intrinsic value of options exercised | $ 200 | 4,200 | 500 | ||||
Total compensation expense | 5,832 | 7,200 | 1,166 | ||||
Income tax effect | 1,138 | 2,078 | 274 | ||||
Net compensation expense | $ 4,694 | $ 5,122 | $ 892 | ||||
Return On Net Assets | $ 22.54 | $ 20.68 | $ 19.40 | ||||
Performance shares settled in cash | 100% | ||||||
Restricted stock | |||||||
Number of Shares | |||||||
Period start, non-vested (in shares) | 216,400 | 187,500 | 230,100 | ||||
Granted (in shares) | 84,400 | 73,300 | 63,400 | ||||
Vested (in shares) | (88,700) | (44,400) | (55,000) | ||||
Forfeited (in shares) | 0 | 0 | (51,000) | ||||
Period end, non-vested (in shares) | 212,100 | 216,400 | 187,500 | 230,100 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||||||
Period start, non-vested (in dollars per share) | $ 17.28 | $ 16.82 | $ 17.02 | ||||
Grant Date Fair Value (in dollars per share) | 22.54 | 20.68 | 18.82 | ||||
Vested in Period, Weighted Average Grant Date Fair Value (in dollars per share) | 13.74 | 20.70 | 19.45 | ||||
Forfeitures, Weighted Average Grant Date Fair Value (in dollars per share) | 0 | 0 | 17.30 | ||||
Period end, non-vested (in dollars per shares) | $ 20.86 | $ 17.28 | $ 16.82 | $ 17.02 | |||
Additional Disclosures [Abstract] | |||||||
Vesting period | 3 years | ||||||
Fair value of restricted stock awards vested | $ 1,200 | $ 900 | $ 1,100 | ||||
Unrecognized compensation cost - non vested restricted stock awards | $ 1,900 | ||||||
Weighted-average period over which unrecognized cost is expected to be recognized | 1 year 9 months 18 days | ||||||
Total compensation expense | $ 1,452 | 1,235 | 625 | ||||
Stock options | |||||||
Additional Disclosures [Abstract] | |||||||
Vesting period | 3 years | ||||||
Expiration period | 10 years | ||||||
Total compensation expense | $ 0 | 0 | 10 | ||||
Fair value of stock options vested | $ 0 | $ 0 | $ 600 | ||||
Restricted Stock Units (RSUs) | |||||||
Number of Shares | |||||||
Vested (in shares) | (36,669) | (28,826) | (25,621) | ||||
Period end, non-vested (in shares) | 21,774 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||||||
Vested in Period, Weighted Average Grant Date Fair Value (in dollars per share) | $ 22.52 | $ 18.79 | $ 18.18 | ||||
Period end, non-vested (in dollars per shares) | $ 17.08 | ||||||
Additional Disclosures [Abstract] | |||||||
Vesting period | 3 years | ||||||
Total compensation expense | $ 1,167 | $ 1,197 | $ 186 | ||||
Payment For Settlement Of Share-Based Compensation | $ 1,000 | 800 | 200 | ||||
Performance Shares | |||||||
Number of Shares | |||||||
Vested (in shares) | (183,000) | ||||||
Additional Disclosures [Abstract] | |||||||
Vesting period | 3 years | ||||||
Total compensation expense | $ 2,373 | 4,039 | (170) | ||||
Performance shares granted | 80,900 | 65,300 | 55,900 | ||||
Payment For Settlement Of Share-Based Compensation | $ 3,800 | ||||||
Performance shares forfeited | 0 | 0 | 5,300 | ||||
Performance Restricted Stock Units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||||||
Grant Date Fair Value (in dollars per share) | $ 21.06 | $ 20.68 | $ 19.40 | ||||
Additional Disclosures [Abstract] | |||||||
Vesting period | 3 years | ||||||
Total compensation expense | $ 840 | $ 729 | $ 515 | ||||
Performance shares granted | 50,900 | 38,400 | 35,000 | ||||
Performance shares forfeited | 0 | 0 | 0 | ||||
Minimum | |||||||
Additional Disclosures [Abstract] | |||||||
Performance shares vesting percentage | 0% | ||||||
Minimum | Performance Restricted Stock Units | |||||||
Additional Disclosures [Abstract] | |||||||
Performance shares vesting percentage | 0% | ||||||
Maximum | |||||||
Additional Disclosures [Abstract] | |||||||
Performance shares vesting percentage | 200% | ||||||
Maximum | Performance Restricted Stock Units | |||||||
Additional Disclosures [Abstract] | |||||||
Performance shares vesting percentage | 150% | ||||||
Share-based Compensation Award, Tranche One [Member] | Performance Restricted Stock Units | |||||||
Additional Disclosures [Abstract] | |||||||
Performance shares vesting percentage | 150% | ||||||
Share-based Compensation Award, Tranche Two [Member] | Performance Restricted Stock Units | |||||||
Additional Disclosures [Abstract] | |||||||
Performance shares vesting percentage | 100% | ||||||
Share-based Compensation Award, Tranche Three [Member] | Performance Restricted Stock Units | |||||||
Additional Disclosures [Abstract] | |||||||
Performance shares vesting percentage | 50% | ||||||
Share-Based Compensation Award, Tranche Four [Member] | Performance Restricted Stock Units | |||||||
Additional Disclosures [Abstract] | |||||||
Performance shares vesting percentage | 0% |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) | 12 Months Ended | ||||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | Dec. 10, 2021 | Aug. 30, 2018 | |
Class of Stock [Line Items] | |||||
Stock Repurchase Program, Authorized Amount | $ 75,000,000 | $ 60,000,000 | |||
Common stock, shares authorized (in shares) | 125,000,000 | 125,000,000 | |||
Common stock, par value (usd per share) | $ 0.01 | $ 0.01 | |||
Preferred stock, shares authorized (in shares) | 1,000,000 | 1,000,000 | |||
Preferred stock, par value (usd per share) | $ 0 | ||||
Common stock, shares, issued (in shares) | 37,211,056 | 37,273,510 | |||
Common stock, shares, outstanding (in shares) | 33,129,250 | 33,274,785 | |||
Stock repurchased during period, shares (in shares) | 291,000 | 478,311 | |||
Stock repurchased during period, value | $ 6,600,000 | $ 11,182,000 | $ 7,233,000 | ||
Retained Earnings | |||||
Class of Stock [Line Items] | |||||
Deficiency of stock option proceeds recorded to retained earnings | $ 0 | $ 0 | $ 100,000 |
Other Income (Expense) (Detail)
Other Income (Expense) (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Other Income and Expenses [Abstract] | |||
Foreign currency transaction gains (losses) | $ 386 | $ (98) | $ (42) |
Foreign currency exchange derivative gains (losses) | 19 | 0 | (15) |
Pension service benefit | 783 | 839 | 243 |
Interest income | 19 | 5 | 28 |
Other | (166) | 8 | 66 |
Other Nonoperating Gains (Losses) | $ 1,041 | $ 754 | $ 280 |
Segment Information (Detail)
Segment Information (Detail) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2022 USD ($) | Jul. 31, 2022 USD ($) | Apr. 30, 2022 USD ($) | Jan. 31, 2022 USD ($) | Oct. 31, 2021 USD ($) | Jul. 31, 2021 USD ($) | Apr. 30, 2021 USD ($) | Jan. 31, 2021 USD ($) | Oct. 31, 2022 USD ($) segment | Oct. 31, 2021 USD ($) | Oct. 31, 2020 USD ($) | |
Segment Reporting Information [Line Items] | |||||||||||
Number of segments | segment | 3 | ||||||||||
General and Administrative Expense | $ 24,500 | $ 21,600 | $ 21,700 | ||||||||
Net sales | $ 307,532 | $ 324,037 | $ 322,893 | $ 267,040 | $ 291,768 | $ 279,877 | $ 270,357 | $ 230,147 | 1,221,502 | 1,072,149 | 851,573 |
Depreciation and amortization | 9,555 | 9,734 | 10,563 | 10,257 | 10,189 | 10,683 | 10,845 | 11,015 | 40,109 | 42,732 | 47,229 |
Operating income (loss) | 28,570 | $ 34,035 | $ 34,550 | $ 14,126 | 27,093 | $ 21,562 | $ 21,380 | $ 11,835 | 111,281 | 81,870 | 55,265 |
Interest Expense | 2,559 | 2,530 | 5,245 | ||||||||
Other, net | 1,041 | 754 | 280 | ||||||||
Income tax expense | (21,427) | (23,114) | (11,804) | ||||||||
Income (loss) from continuing operations | 88,336 | 56,980 | 38,496 | ||||||||
Capital expenditures | 33,121 | 24,008 | 25,726 | ||||||||
Long-lived assets, net | 439,290 | 462,953 | 439,290 | 462,953 | |||||||
Goodwill | 137,855 | 149,205 | 137,855 | 149,205 | 146,154 | ||||||
Assets | 724,617 | 717,323 | 724,617 | 717,323 | |||||||
Goodwill, Translation Adjustments | (11,350) | 3,051 | |||||||||
Woodcraft | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Goodwill | 39,200 | 39,200 | |||||||||
EU Fenestration | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Goodwill, Translation Adjustments | (11,350) | 3,051 | |||||||||
United States | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 911,180 | 778,486 | 654,802 | ||||||||
Long-lived assets, net | 279,616 | 291,282 | 279,616 | 291,282 | |||||||
Europe | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 255,400 | 244,308 | 158,831 | ||||||||
Canada | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 31,442 | 25,007 | 18,213 | ||||||||
Asia | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 15,021 | 18,445 | 11,504 | ||||||||
Other foreign countries | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 8,459 | 5,903 | 8,223 | ||||||||
Germany | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Long-lived assets, net | 41,669 | 25,513 | 41,669 | 25,513 | |||||||
United Kingdom | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Long-lived assets, net | 118,005 | 146,158 | $ 118,005 | 146,158 | |||||||
Operating Segments | NA Fenestration | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Number of segments | segment | 3 | ||||||||||
Net sales | $ 687,458 | 578,332 | 483,415 | ||||||||
Depreciation and amortization | 16,253 | 18,730 | 23,555 | ||||||||
Operating income (loss) | 74,570 | 56,248 | 39,909 | ||||||||
Capital expenditures | 18,758 | 9,966 | 15,761 | ||||||||
Goodwill | 38,712 | 38,712 | 38,712 | 38,712 | 38,712 | ||||||
Assets | 279,139 | 268,773 | 279,139 | 268,773 | |||||||
Goodwill, Translation Adjustments | 0 | 0 | |||||||||
Operating Segments | EU Fenestration | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 262,058 | 251,599 | 161,054 | ||||||||
Depreciation and amortization | 9,674 | 10,373 | 9,468 | ||||||||
Operating income (loss) | 40,270 | 39,299 | 20,076 | ||||||||
Capital expenditures | 7,810 | 8,155 | 5,435 | ||||||||
Goodwill | 59,996 | 71,346 | 59,996 | 71,346 | 68,295 | ||||||
Assets | 223,729 | 236,755 | 223,729 | 236,755 | |||||||
Operating Segments | NA Cabinet Components | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 275,704 | 246,075 | 210,099 | ||||||||
Depreciation and amortization | 13,830 | 13,263 | 13,732 | ||||||||
Operating income (loss) | 3,245 | 896 | (2,502) | ||||||||
Capital expenditures | 6,454 | 5,559 | 4,423 | ||||||||
Goodwill | 39,147 | 39,147 | 39,147 | 39,147 | 39,147 | ||||||
Assets | 176,154 | 178,671 | 176,154 | 178,671 | |||||||
Goodwill, Translation Adjustments | 0 | 0 | |||||||||
Operating Segments | Non-fenestration | United States | NA Fenestration | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 29,039 | 24,534 | 19,279 | ||||||||
Operating Segments | Non-fenestration | United States | NA Cabinet Components | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 254,726 | 230,559 | 196,479 | ||||||||
Operating Segments | Non-fenestration | International | NA Fenestration | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 12,941 | 11,554 | 7,935 | ||||||||
Operating Segments | Non-fenestration | International | EU Fenestration | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 67,204 | 52,088 | 26,622 | ||||||||
Operating Segments | Non-fenestration | International | NA Cabinet Components | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 3,282 | 2,190 | 1,778 | ||||||||
Operating Segments | Fenestration | United States | NA Fenestration | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 609,572 | 507,634 | 427,616 | ||||||||
Operating Segments | Fenestration | United States | NA Cabinet Components | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 17,696 | 13,326 | 11,842 | ||||||||
Operating Segments | Fenestration | International | NA Fenestration | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 35,906 | 34,610 | 28,585 | ||||||||
Operating Segments | Fenestration | International | EU Fenestration | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 194,854 | 199,511 | 134,432 | ||||||||
Intersegment Eliminations | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | (3,718) | (3,857) | (2,995) | ||||||||
Corporate, Non-segment | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | (3,718) | (3,857) | (2,995) | ||||||||
Depreciation and amortization | 352 | 366 | 474 | ||||||||
Operating income (loss) | (6,804) | (14,573) | (2,218) | ||||||||
Capital expenditures | 99 | 328 | 107 | ||||||||
Goodwill | 0 | 0 | 0 | 0 | $ 0 | ||||||
Assets | $ 45,595 | $ 33,124 | 45,595 | 33,124 | |||||||
Goodwill, Translation Adjustments | $ 0 | $ 0 |
Earnings Per Share (Detail)
Earnings Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2022 | Jul. 31, 2022 | Apr. 30, 2022 | Jan. 31, 2022 | Oct. 31, 2021 | Jul. 31, 2021 | Apr. 30, 2021 | Jan. 31, 2021 | Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Earnings Per Share Disclosure [Line Items] | |||||||||||
Income (loss) from continuing operations | $ 88,336 | $ 56,980 | $ 38,496 | ||||||||
Weighted average number of shares outstanding, basic | 33,048 | 33,193 | 32,689 | ||||||||
Weighted average number of shares outstanding, diluted | 33,205 | 33,495 | 32,821 | ||||||||
Basic earnings per common share | $ 0.75 | $ 0.79 | $ 0.80 | $ 0.34 | $ 0.63 | $ 0.41 | $ 0.44 | $ 0.24 | $ 2.67 | $ 1.72 | $ 1.18 |
Diluted earnings per common share | $ 0.75 | $ 0.78 | $ 0.80 | $ 0.34 | $ 0.62 | $ 0.41 | $ 0.43 | $ 0.24 | $ 2.66 | $ 1.70 | $ 1.17 |
Antidilutive securities | 0 | 0 | 1,032 | ||||||||
Stock options | |||||||||||
Earnings Per Share Disclosure [Line Items] | |||||||||||
Weighted Average Dilutive Securities | 25 | 82 | 10 | ||||||||
Antidilutive securities | 0 | 0 | 1,032 | ||||||||
Restricted stock | |||||||||||
Earnings Per Share Disclosure [Line Items] | |||||||||||
Weighted Average Dilutive Securities | 100 | 132 | 90 | ||||||||
Antidilutive securities | 0 | 0 | 0 | ||||||||
Performance Shares | |||||||||||
Earnings Per Share Disclosure [Line Items] | |||||||||||
Weighted Average Dilutive Securities | 32 | 88 | 32 | ||||||||
Antidilutive securities | 0 | 0 | 0 |
Unaudited Quarterly Data (Detai
Unaudited Quarterly Data (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2022 | Jul. 31, 2022 | Apr. 30, 2022 | Jan. 31, 2022 | Oct. 31, 2021 | Jul. 31, 2021 | Apr. 30, 2021 | Jan. 31, 2021 | Oct. 31, 2022 | Oct. 31, 2021 | Oct. 31, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Net sales | $ 307,532 | $ 324,037 | $ 322,893 | $ 267,040 | $ 291,768 | $ 279,877 | $ 270,357 | $ 230,147 | $ 1,221,502 | $ 1,072,149 | $ 851,573 |
Cost of sales (excluding depreciation and amortization) | 240,073 | 251,446 | 249,651 | 211,834 | 226,818 | 219,866 | 208,460 | 176,397 | 953,004 | 831,541 | 658,750 |
Depreciation and amortization | 9,555 | 9,734 | 10,563 | 10,257 | 10,189 | 10,683 | 10,845 | 11,015 | 40,109 | 42,732 | 47,229 |
Operating income | 28,570 | 34,035 | 34,550 | 14,126 | 27,093 | 21,562 | 21,380 | 11,835 | 111,281 | 81,870 | 55,265 |
Net income | $ 24,667 | $ 25,908 | $ 26,522 | $ 11,239 | $ 20,898 | $ 13,679 | $ 14,551 | $ 7,852 | $ 88,336 | $ 56,980 | $ 38,496 |
Basic earnings (loss) per share (usd per share) | $ 0.75 | $ 0.79 | $ 0.80 | $ 0.34 | $ 0.63 | $ 0.41 | $ 0.44 | $ 0.24 | $ 2.67 | $ 1.72 | $ 1.18 |
Diluted earnings (loss) per share (usd per share) | 0.75 | 0.78 | 0.80 | 0.34 | 0.62 | 0.41 | 0.43 | 0.24 | 2.66 | 1.70 | 1.17 |
Cash dividends paid per common share (usd per share) | $ 0.08 | $ 0.08 | $ 0.08 | $ 0.08 | $ 0.08 | $ 0.08 | $ 0.08 | $ 0.08 | $ 0.32 | $ 0.32 | $ 0.32 |
Subsequent Events (Details)
Subsequent Events (Details) $ in Millions | Nov. 01, 2022 USD ($) ft² | Oct. 31, 2022 USD ($) |
Subsequent Event [Line Items] | ||
Credit facility, amount available | $ 307 | |
Subsequent Event | Ohio | ||
Subsequent Event [Line Items] | ||
Increase in net rentable area | ft² | 60,000 | |
Net rentable area | ft² | 313,595 | |
Subsequent Event | Line of Credit | ||
Subsequent Event [Line Items] | ||
Credit facility, amount available | $ 215 | |
Subsequent Event | LMI Custom Mixing, LLC | ||
Subsequent Event [Line Items] | ||
Payments to acquire productive assets | 92 | |
Indemnification asset | $ 7.1 |