Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2023 | Apr. 27, 2023 | |
Cover page. | ||
Entity Registrant Name | TopBuild Corp | |
Entity Central Index Key | 0001633931 | |
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-36870 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 47-3096382 | |
Entity Address, Address Line One | 475 North Williamson Boulevard | |
Entity Address, City or Town | Daytona Beach | |
Entity Address, State or Province | FL | |
Entity Address, Postal Zip Code | 32114 | |
City Area Code | 386 | |
Local Phone Number | 304-2200 | |
Title of 12(b) Security | Common stock, par value $0.01 per share | |
Trading Symbol | BLD | |
Security Exchange Name | NYSE | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 31,749,321 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 333,778 | $ 240,069 |
Receivables, net of an allowance for credit losses of $16,007 at March 31, 2023, and $16,281 at December 31, 2022 | 833,959 | 836,071 |
Inventories, net | 422,229 | 438,644 |
Prepaid expenses and other current assets | 22,861 | 34,257 |
Total current assets | 1,612,827 | 1,549,041 |
Right of use assets | 211,381 | 205,892 |
Property and equipment, net | 260,146 | 253,484 |
Goodwill | 1,992,394 | 1,966,994 |
Other intangible assets, net | 607,683 | 614,967 |
Other assets | 16,483 | 16,453 |
Total assets | 4,700,914 | 4,606,831 |
Current liabilities: | ||
Accounts payable | 450,963 | 487,114 |
Current portion of long-term debt | 42,371 | 40,068 |
Accrued liabilities | 193,347 | 199,370 |
Short-term operating lease liabilities | 62,110 | 60,880 |
Short-term finance lease liabilities | 2,452 | 2,207 |
Total current liabilities | 751,243 | 789,639 |
Long-term debt | 1,405,931 | 1,417,257 |
Deferred tax liabilities, net | 252,044 | 251,481 |
Long-term portion of insurance reserves | 61,466 | 59,783 |
Long-term operating lease liabilities | 154,844 | 149,943 |
Long-term finance lease liabilities | 4,983 | 6,673 |
Other liabilities | 5,259 | 2,349 |
Total liabilities | 2,635,770 | 2,677,125 |
Commitments and contingencies | ||
Equity: | ||
Preferred stock, $0.01 par value: 10,000,000 shares authorized; 0 shares issued and outstanding | ||
Common stock, $0.01 par value: 250,000,000 shares authorized; 39,465,688 shares issued and 31,750,010 outstanding at March 31, 2023, and 39,325,916 shares issued and 31,642,832 outstanding at December 31, 2022 | 395 | 393 |
Treasury stock, 7,715,678 shares at March 31, 2023, and 7,683,084 shares at December 31, 2022, at cost | (699,149) | (692,799) |
Additional paid-in capital | 891,530 | 887,367 |
Retained earnings | 1,892,535 | 1,756,665 |
Accumulated other comprehensive loss | (20,167) | (21,920) |
Total equity | 2,065,144 | 1,929,706 |
Total liabilities and equity | $ 4,700,914 | $ 4,606,831 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Allowance for credit losses | $ 16,007 | $ 16,281 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares, issued | 0 | 0 |
Preferred stock, shares, outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 250,000,000 | 250,000,000 |
Common stock, shares issued | 39,465,688 | 39,325,916 |
Common stock, shares outstanding | 31,750,010 | 31,642,832 |
Treasury stock, shares at cost | 7,715,678 | 7,683,084 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||
Net sales | $ 1,265,238 | $ 1,168,918 |
Cost of sales | 895,023 | 837,717 |
Gross profit | 370,215 | 331,201 |
Selling, general, and administrative expense | 170,784 | 167,247 |
Operating profit | 199,431 | 163,954 |
Other income (expense), net: | ||
Interest expense | (18,039) | (11,966) |
Other, net | 1,923 | 684 |
Other expense, net | (16,116) | (11,282) |
Income before income taxes | 183,315 | 152,672 |
Income tax expense | (47,445) | (37,961) |
Net income | $ 135,870 | $ 114,711 |
Net income per common share: | ||
Basic | $ 4.31 | $ 3.50 |
Diluted | $ 4.28 | $ 3.47 |
Weighted average shares outstanding: | ||
Basic | 31,550,658 | 32,738,525 |
Diluted | 31,713,239 | 33,042,490 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||
Net income | $ 135,870 | $ 114,711 |
Other comprehensive income: | ||
Foreign currency translation adjustment | 1,753 | 3,218 |
Comprehensive income | $ 137,623 | $ 117,929 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Cash Flows Provided by (Used in) Operating Activities: | ||
Net income | $ 135,870 | $ 114,711 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 32,100 | 30,499 |
Share-based compensation | 3,135 | 3,727 |
Loss on sale of property and equipment | 185 | 207 |
Amortization of debt issuance costs | 720 | 706 |
Provision for bad debt expense | 1,338 | 2,512 |
Loss from inventory obsolescence | 1,642 | 868 |
Deferred income taxes, net | 563 | (81) |
Change in certain assets and liabilities: | ||
Receivables, net | (10,847) | (65,031) |
Inventories, net | 20,096 | (38,570) |
Prepaid expenses and other current assets | 11,579 | (2,347) |
Accounts payable | (25,480) | 12,663 |
Accrued liabilities | (3,339) | 29,523 |
Other, net | 2,239 | 96 |
Net cash provided by operating activities | 169,801 | 89,483 |
Cash Flows Provided by (Used in) Investing Activities: | ||
Purchases of property and equipment | (15,580) | (18,413) |
Acquisition of businesses, net of cash acquired | (45,845) | (13,967) |
Proceeds from sale of property and equipment | 455 | 253 |
Net cash used in investing activities | (60,970) | (32,127) |
Cash Flows Provided by (Used in) Financing Activities: | ||
Repayment of long-term debt | (9,743) | (9,634) |
Taxes withheld and paid on employees' equity awards | (6,350) | (11,658) |
Exercise of stock options | 1,029 | 808 |
Repurchase of shares of common stock | (50,000) | |
Payment of contingent consideration | (23) | |
Net cash used in financing activities | (15,064) | (70,507) |
Cash and Cash Equivalents | ||
Impact of exchange rate changes on cash | (58) | (75) |
Net increase (decrease) in cash and cash equivalents | 93,709 | (13,226) |
Cash and cash equivalents- Beginning of period | 240,069 | 139,779 |
Cash and cash equivalents- End of period | 333,778 | 126,553 |
Supplemental disclosure of noncash activities: | ||
Leased assets obtained in exchange for new operating lease liabilities | 18,271 | 22,449 |
Accruals for property and equipment | $ 835 | $ 213 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) $ in Thousands | Common Stock | Treasury Stock at Cost | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income | Total |
Balance at Dec. 31, 2021 | $ 391 | $ (431,030) | $ 873,031 | $ 1,200,676 | $ (6,634) | $ 1,636,434 |
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 114,711 | 114,711 | ||||
Share-based compensation | 3,727 | 3,727 | ||||
Issuance of restricted share awards under long-term equity incentive plan | 2 | (2) | ||||
Repurchase of shares | (50,000) | (50,000) | ||||
Shares withheld to pay taxes on employees' equity awards | (11,658) | (11,658) | ||||
Shares issued upon exercise of stock options | 808 | 808 | ||||
Other comprehensive income, net of tax | 3,218 | 3,218 | ||||
Balance at Mar. 31, 2022 | 393 | (492,688) | 877,564 | 1,315,387 | (3,416) | 1,697,240 |
Balance at Dec. 31, 2022 | 393 | (692,799) | 887,367 | 1,756,665 | (21,920) | 1,929,706 |
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 135,870 | 135,870 | ||||
Share-based compensation | 3,135 | 3,135 | ||||
Issuance of restricted share awards under long-term equity incentive plan | 2 | 2 | ||||
Shares withheld to pay taxes on employees' equity awards | (6,350) | (6,350) | ||||
Shares issued upon exercise of stock options | 1,028 | 1,028 | ||||
Other comprehensive income, net of tax | 1,753 | 1,753 | ||||
Balance at Mar. 31, 2023 | $ 395 | $ (699,149) | $ 891,530 | $ 1,892,535 | $ (20,167) | $ 2,065,144 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Parenthetical) - $ / shares | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY | ||
Common stock, par value (in dollars per share) | $ 0.01 | |
Issuance of restricted share awards under long-term equity incentive plan (in shares) | 95,012 | 52,940 |
Repurchase of shares (in shares) | 238,154 | |
Number of shares withheld to pay taxes on employees' equity awards (in shares) | 32,594 | 53,073 |
Shares issued upon exercise of stock options (in shares) | 28,840 | 12,269 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2023 | |
Summary of Significant Accounting Policies | |
Basis of Presentation | 1. BASIS OF PRESENTATION TopBuild was formed on June 30, 2015, and is listed on the NYSE under the ticker symbol “BLD.” We report our business in two segments: Installation and Specialty Distribution. Our Installation segment primarily installs insulation and other building products. Our Specialty Distribution segment primarily sells and distributes insulation and other building products. Our segments are based on our operating units, for which financial information is regularly evaluated by our chief operating decision maker. We believe the accompanying unaudited condensed consolidated financial statements contain all adjustments, of a normal recurring nature, necessary to state fairly our financial position as of March 31, 2023, our results of operations, comprehensive income and cash flows for the three months ended March 31, 2023 and 2022. The condensed consolidated balance sheet at December 31, 2022 was derived from our audited financial statements, but does not include all disclosures required by GAAP. These condensed consolidated financial statements and related notes should be read in conjunction with the audited Consolidated Financial Statements included in the Company’s Annual Report for the year ended December 31, 2022 as filed with the SEC on February 23, 2023. |
Accounting Policies
Accounting Policies | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies | |
Accounting Policies | 2. ACCOUNTING POLICIES Financial Statement Presentation. Our condensed consolidated financial statements have been developed in conformity with GAAP, which requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosures of contingent liabilities at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting periods. Actual results could differ materially from these estimates. All intercompany transactions between TopBuild entities have been eliminated. Recently Adopted Accounting Pronouncements In October 2021, the FASB issued ASU 2021-08, “Accounting for Contract Assets and Contract Liabilities from Contracts with Customers”. This standard improves the accounting for acquired revenue contracts with customers in a business combination by addressing diversity in practice and inconsistency related to recognition of an acquired contract liability, as well as payment terms and their effect on subsequent revenue recognized by the acquirer. This standard became effective for us on January 1, 2023, and did not have a material impact to our financial statements upon adoption. |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Mar. 31, 2023 | |
Revenue Recognition | |
Revenue Recognition | 3. REVENUE RECOGNITION Revenue is disaggregated between our Installation and Specialty Distribution segments and further based on market and product, as we believe this best depicts how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors. The following table presents our revenues disaggregated by market (in thousands): Three Months Ended March 31, 2023 2022 Installation Specialty Distribution Eliminations Total Installation Specialty Distribution Eliminations Total Residential $ 645,703 $ 224,326 $ (51,390) $ 818,639 $ 563,303 $ 236,411 $ (43,421) $ 756,293 Commercial/Industrial 121,387 334,049 (8,837) 446,599 113,390 307,451 (8,216) 412,625 Net sales $ 767,090 $ 558,375 $ (60,227) $ 1,265,238 $ 676,693 $ 543,862 $ (51,637) $ 1,168,918 The following table presents our revenues disaggregated by product (in thousands): Three Months Ended March 31, 2023 2022 Installation Specialty Distribution Eliminations Total Installation Specialty Distribution Eliminations Total Insulation and accessories $ 600,767 $ 502,802 $ (51,973) $ 1,051,596 $ 536,341 $ 479,760 $ (43,810) $ 972,291 Glass and windows 63,442 - - 63,442 51,196 - - 51,196 Gutters 28,278 39,842 (7,165) 60,955 22,957 46,631 (7,002) 62,586 All other 74,603 15,731 (1,089) 89,245 66,199 17,471 (825) 82,845 Net sales $ 767,090 $ 558,375 $ (60,227) $ 1,265,238 $ 676,693 $ 543,862 $ (51,637) $ 1,168,918 The following table represents our contract assets and contract liabilities with customers, in thousands: Included in Line Item on As of Condensed Consolidated March 31, December 31, Balance Sheets 2023 2022 Contract Assets: Receivables, unbilled Receivables, net $ 78,034 $ 75,481 Contract Liabilities: Deferred revenue Accrued liabilities $ 20,738 $ 21,940 The aggregate amount remaining on uncompleted performance obligations was $395.5 million as of March 31, 2023. We expect to satisfy the performance obligations and recognize revenue on substantially all of these uncompleted contracts over the next 18 months . On certain of our long-term contracts, a percentage of the total project cost is withheld and not invoiced to the customer and collected until satisfactory completion of the customer ’ s project, typically within a year. This amount is referred to as retainage and is common practice in the construction industry. |
Goodwill and Other Intangibles
Goodwill and Other Intangibles | 3 Months Ended |
Mar. 31, 2023 | |
Goodwill and Other Intangibles | |
Goodwill and Other Intangibles | 4. GOODWILL AND OTHER INTANGIBLES We have two reporting units which are also our operating and reporting segments: Installation and Specialty Distribution. Both reporting units contain goodwill. Assets acquired and liabilities assumed are assigned to the applicable reporting unit based on whether the acquired assets and liabilities relate to the operations of and determination of the fair value of such unit. Goodwill assigned to the reporting unit is the excess of the fair value of the acquired business over the fair value of the individual assets acquired and liabilities assumed for the reporting unit. In the fourth quarter of 2022, we performed an annual assessment on our goodwill resulting in no impairment and there were no indicators of impairment for the three months ended March 31, 2023. Changes in the carrying amount of goodwill for three months ended March 31, 2023, by segment, were as follows, in thousands: Accumulated Gross Goodwill Fx Translation Gross Goodwill Impairment Net Goodwill December 31, 2022 Additions Adjustment March 31, 2023 Losses March 31, 2023 Goodwill, by segment: Installation $ 1,826,979 $ 25,384 $ - $ 1,852,363 $ (762,021) $ 1,090,342 Specialty Distribution 902,036 - 16 902,052 - 902,052 Total goodwill $ 2,729,015 $ 25,384 $ 16 $ 2,754,415 $ (762,021) $ 1,992,394 See Note 11 – Business Combinations Other intangible assets, net includes customer relationships, non-compete agreements, and trademarks / trade names. The following table sets forth our other intangible assets, in thousands: As of March 31, 2023 December 31, 2022 Gross definite-lived intangible assets $ 791,939 $ 782,316 Accumulated amortization (184,256) (167,349) Net definite-lived intangible assets $ 607,683 $ 614,967 The following table sets forth our amortization expense, in thousands: Three Months Ended March 31, 2023 2022 Amortization expense $ 16,896 $ 17,825 |
Long-Term Debt
Long-Term Debt | 3 Months Ended |
Mar. 31, 2023 | |
Long-Term Debt | |
Long-Term Debt | 5. LONG-TERM DEBT The following table reconciles the principal balances of our outstanding debt to our condensed consolidated balance sheets, in thousands: As of March 31, 2023 December 31, 2022 3.625% Senior Notes due 2029 $ 400,000 $ 400,000 4.125% Senior Notes due 2032 500,000 500,000 Term loan 558,750 566,250 Equipment notes 6,185 8,427 Unamortized debt issuance costs (16,633) (17,352) Total debt, net of unamortized debt issuance costs 1,448,302 1,457,325 Less: current portion of long-term debt 42,371 40,068 Total long-term debt $ 1,405,931 $ 1,417,257 The following table sets forth our remaining principal payments for our outstanding debt balances as of March 31, 2023, in thousands: 2023 2024 2025 2026 2027 Thereafter Total 3.625% Senior Notes $ - $ - $ - $ - $ - $ 400,000 $ 400,000 4.125% Senior Notes - - - - - 500,000 500,000 Term loan 26,250 45,000 48,750 438,750 - - 558,750 Equipment notes 4,076 2,109 - - - - 6,185 Total $ 30,326 $ 47,109 $ 48,750 $ 438,750 $ - $ 900,000 $ 1,464,935 Credit Agreement The following table outlines the key terms of the Credit Agreement (dollars in thousands): Senior secured term loan facility $ 300,000 Additional delayed draw term loan $ 300,000 Additional term loan and/or revolver capacity available under incremental facility (a) $ 300,000 Revolving facility $ 500,000 Sublimit for issuance of letters of credit under revolving facility (b) $ 100,000 Sublimit for swingline loans under revolving facility (b) $ 35,000 Interest rate as of March 31, 2023 5.91 % Scheduled maturity date 10/7/2026 (a) Additional borrowing capacity is available under the incremental facility, subject to certain terms and conditions (including existing or new lenders providing commitments in respect of such additional borrowing capacity). (b) Use of the sublimits for the issuance of letters of credit and swingline loans reduces the availability under the Revolving Facility. Interest payable on borrowings under the Credit Agreement is based on an applicable margin rate plus, at our option, either: ● A base rate determined by reference to the highest of either (i) the federal funds rate plus 0.50 percent, (ii) BofA’s “prime rate,” and (iii) the SOFR rate for U.S. dollar deposits with a term of one month , plus 1.00 percent; or ● A SOFR rate determined by reference to the costs of funds for deposits in U.S. dollars for the interest period relevant to such borrowings, subject to a floor of 0% . The applicable margin rate is determined based on our Secured Leverage Ratio. In the case of base rate borrowings, the applicable margin rate ranges from 0.00 percent to 1.50 percent and in the case of SOFR rate borrowings, the applicable margin ranges from 1.00 percent to 2.50 percent. Borrowings under the Credit Agreement are prepayable at the Company’s option without premium or penalty. The Company is required to make prepayments with the net cash proceeds of certain asset sales and certain extraordinary receipts. Revolving Facility The Company has outstanding standby letters of credit that secure our financial obligations related to our workers’ compensation, general insurance, and auto liability programs. These standby letters of credit, as well as any outstanding amount borrowed under our Revolving Facility, reduce the availability under the Revolving Facility. The following table summarizes our availability under the Revolving Facility, in thousands: As of March 31, 2023 December 31, 2022 Revolving facility $ 500,000 $ 500,000 Less: standby letters of credit (67,689) (67,689) Availability under revolving facility $ 432,311 $ 432,311 We are required to pay commitment fees to the Lenders in respect of any unutilized commitments. The commitment fees range from 0.15 percent to 0.275 percent per annum, depending on our Secured Leverage Ratio. We must also pay customary fees on outstanding letters of credit. 3.625% Senior Notes The 3.625% Senior Notes are $400.0 million senior unsecured obligations and bear interest at 3.625% per year, payable semiannually in arrears on March 15 and September 15, beginning on September 15, 2021. The 3.625% Senior Notes mature on March 15, 2029, unless redeemed early or repurchased. If we undergo a change in control, we must make an offer to repurchase all of the 3.625% Senior Notes then outstanding at a repurchase price equal to 101% of their aggregate principal amount, plus accrued and unpaid interest (if any) to, but not including, the repurchase date. The Company may redeem the 3.625% Senior Notes, in whole or in part, at any time on or after March 15, 2024 at the redemption prices specified in the notes. The Company may also redeem all or part of the 3.625% Senior Notes at any time prior to March 15, 2024 at a redemption price equal to 100% of the principal amount of the notes to be redeemed, plus the Applicable Premium (as defined in the notes), as of, and accrued and unpaid interest to, the redemption date. Additionally, the Company may redeem up to 40% of the aggregate principal amount of the 3.625% Senior Notes prior to March 15, 2024 with the net cash proceeds of certain sales of its capital stock at 103.625% of the principal amount of the notes, plus accrued and unpaid interest, if any, to the date of redemption only if, after the redemption, at least 60% of the aggregate principal amount of the 3.625% Senior Notes originally issued remains outstanding. 4.125% Senior Notes The 4.125% Senior Notes are $500.0 million senior unsecured obligations and bear interest at 4.125% per year, payable semiannually in arrears on February 15 and August 15, beginning on August 15, 2022. The 4.125% Senior Notes mature on February 15, 2032, unless redeemed early or repurchased. If we undergo a change in control, we must make an offer to repurchase all of the 4.125% Senior Notes then outstanding at a repurchase price equal to 101% of their aggregate principal amount, plus accrued and unpaid interest (if any) to, but not including, the repurchase date. The Company may redeem the 4.125% Senior Notes, in whole or in part, at any time on or after October 15, 2026 at the redemption prices specified in the notes plus accrued and unpaid interest if redeemed during the 12 month period commencing on October 15 of the years set for: 2026 – 102.063%, 2027 – 101.375%, 2028 – 100.688%, 2029 and thereafter – 100.000%. The Company may also redeem a make-whole redemption of the 4.125% Senior Notes at any time prior to October 15, 2026 at the treasury rate plus 50 basis points. Additionally, the Company may redeem up to 40% of the aggregate principal amount of the 4.125% Senior Notes prior to October 15, 2024 with the net cash proceeds of certain sales of its capital stock at 104.125% of the principal amount of the notes, plus accrued and unpaid interest, if any, to the date of redemption only if, after the redemption, at least 60% of the aggregate principal amount of the notes originally issued remains outstanding. Equipment Notes We did not issue equipment notes during the three months ended March 31, 2023. The company has issued $41.6 million of equipment notes for the purpose of financing the purchase of vehicles and equipment. The Company’s equipment notes each have a five year term maturing in 2023 and 2024 and bear interest at fixed rates between 2.8% and 4.4% . Covenant Compliance The indentures governing our 3.625% Senior Notes and our 4.125% Senior Notes (together, our “Senior Notes”) contain restrictive covenants that, among other things, generally limit the ability of the Company and certain of its subsidiaries (subject to certain exceptions) to (i) create liens, (ii) pay dividends, acquire shares of capital stock and make payments on subordinated debt, (iii) place limitations on distributions from certain subsidiaries, (iv) issue or sell the capital stock of certain subsidiaries, (v) sell assets, (vi) enter into transactions with affiliates and (vii) effect mergers. The indentures provide for customary events of default which include (subject in certain cases to customary grace and cure periods), among others: nonpayment of principal or interest; breach of covenants or other agreements in the indenture; defaults in failure to pay certain other indebtedness; and certain events of bankruptcy or insolvency. Generally, if an event of default occurs and is continuing under the indenture, the trustee or the holders of at least 30% in aggregate principal amount of each of our Senior Notes then outstanding may declare the principal of, premium, if any, and accrued interest on the Senior Notes subject to such declaration immediately due and payable. The Senior Notes and related guarantees have not been registered under the Securities Act of 1933, and we are not required to register either the Senior Notes or the guarantees in the future. The Credit Agreement contains certain covenants that limit, among other things, the ability of the Company to incur additional indebtedness or liens; to make certain investments or loans; to make certain restricted payments; to enter into consolidations, mergers, sales of material assets, and other fundamental changes; to transact with affiliates; to enter into agreements restricting the ability of subsidiaries to incur liens or pay dividends; or to make certain accounting changes. The Credit Agreement contains customary affirmative covenants and events of default. The Credit Agreement requires that we maintain a Net Leverage Ratio and minimum Interest Coverage Ratio throughout the term of the agreement. The following table outlines the key financial covenants effective for the period covered by this Quarterly Report: As of March 31, 2023 Maximum Net Leverage Ratio 3.50:1.00 Minimum Interest Coverage Ratio 3.00:1.00 Compliance as of period end In Compliance |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Measurements | |
Fair Value Measurements | 6 FAIR VALUE MEASUREMENTS Fair Value on Recurring Basis The carrying values of cash and cash equivalents, receivables, net, and accounts payable are considered to be representative of their respective fair values due to the short-term nature of these instruments. Fair Value on Non-Recurring Basis Fair value measurements were applied to our long-term debt portfolio. As of March 31, 2023 Fair Value Gross Carrying Value 3.625% Senior Notes $ 348,580 $ 400,000 4.125% Senior Notes $ 427,500 $ 500,000 |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2023 | |
Segment Information | |
Segment Information | 7. SEGMENT INFORMATION The following tables set forth our net sales and operating results by segment, in thousands: Three Months Ended March 31, 2023 2022 2023 2022 Net Sales Operating Profit (b) Operations by segment (a): Installation $ 767,090 $ 676,693 $ 146,897 $ 112,679 Specialty Distribution 558,375 543,862 73,333 70,420 Intercompany eliminations (60,227) (51,637) (9,971) (8,708) Total $ 1,265,238 $ 1,168,918 210,259 174,391 General corporate expense, net (c) (10,828) (10,437) Operating profit, as reported 199,431 163,954 Other expense, net (16,116) (11,282) Income before income taxes $ 183,315 $ 152,672 (a) All of our operations are located primarily in the U.S and to a lesser extent Canada. (b) Segment operating profit includes an allocation of general corporate expenses attributable to the operating segments which is based on direct benefit or usage (such as salaries of corporate employees who directly support the segment). (c) General corporate expense, net includes expenses not specifically attributable to our segments for functions such as corporate human resources, finance, and legal, including salaries, benefits, and other related costs . |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2023 | |
Income Taxes | |
Income Taxes | 8. INCOME TAXES Our effective tax rates were 25.9 percent and 24.9 percent for the three months ended March 31, 2023 and 2022, respectively. The higher 2023 tax rate was primarily related to a decrease in the benefit related to share-based compensation. A tax benefit of $1.6 million related to share-based compensation was recognized in our condensed consolidated statements of operations as a discrete item in income tax expense for the three months ended March 31, 2022. |
Net Income Per Share
Net Income Per Share | 3 Months Ended |
Mar. 31, 2023 | |
Net Income Per Share | |
Net Income Per Share | 9. NET INCOME PER SHAR E Basic net income per share is calculated by dividing net income by the number of weighted average shares outstanding during the period, without consideration for common stock equivalents. Diluted net income per share is calculated by adjusting the number of weighted average shares outstanding for the dilutive effect of common stock equivalents outstanding for the period, determined using the treasury stock method. Basic and diluted net income per share were computed as follows: Three Months Ended March 31, 2023 2022 Net income (in thousands) $ 135,870 $ 114,711 Weighted average number of common shares outstanding - basic 31,550,658 32,738,525 Dilutive effect of common stock equivalents: RSAs with service-based conditions 22,643 15,127 RSAs with market-based conditions 24,861 100,158 RSAs with performance-based conditions 29,031 64,025 Stock options 86,046 124,655 Weighted average number of common shares outstanding - diluted 31,713,239 33,042,490 Basic net income per common share $ 4.31 $ 3.50 Diluted net income per common share $ 4.28 $ 3.47 The following table summarizes shares excluded from the calculation of diluted net income per share because their effect would have been anti-dilutive: Three Months Ended March 31, 2023 2022 Anti-dilutive common stock equivalents: RSAs with service-based conditions 11,163 10,244 RSAs with market-based conditions 8,933 382 RSAs with performance-based conditions - 7,908 Stock options 22,280 16,587 Total anti-dilutive common stock equivalents 42,376 35,121 |
Share-Based Compensation
Share-Based Compensation | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Compensation. | |
Share-Based Compensation | 10. SHARE-BASED COMPENSATION Effective July 1, 2015, our eligible employees commenced participation in the 2015 LTIP. The 2015 LTIP authorizes the Board to grant stock options, stock appreciation rights, restricted shares, restricted share units, performance awards, and dividend equivalents. All grants are made by issuing new shares and no more than 4.0 million shares of common stock may be issued under the 2015 LTIP. As of March 31, 2023, we had 1.8 million shares remaining available for issuance under the 2015 LTIP. Share-based compensation expense is included in selling, general, and administrative expense. The income tax effect associated with share-based compensation awards is included in income tax expense. The following table presents share-based compensation amounts recognized in our condensed consolidated statements of operations, in thousands: Three Months Ended March 31, 2023 2022 Share-based compensation expense $ 3,135 $ 3,727 Income tax (expense)/benefit $ (45) $ 1,605 The following table presents a summary of our share-based compensation activity for three months ended March 31, 2023, in thousands, except per share amounts: RSAs Stock Options Number of Shares Weighted Average Grant Date Fair Value Per Share Number of Shares Weighted Average Grant Date Fair Value Per Share Weighted Average Exercise Price Per Share Aggregate Intrinsic Value Balance December 31, 2022 173.2 $ 195.06 182.2 $ 32.25 $ 86.79 $ 13,992.3 Granted 95.4 $ 202.24 — $ — $ — — Converted/Exercised (95.0) $ 145.57 (28.8) $ 13.07 $ 35.67 $ 4,504.8 Forfeited/Expired (5.3) $ 242.76 — $ — $ — — Balance March 31, 2023 168.3 $ 225.41 153.4 $ 35.98 $ 96.40 $ 17,277.2 Exercisable March 31, 2023 (a) 145.9 $ 33.25 $ 90.39 $ 17,277.2 (a) The weighted average remaining contractual term for vested stock options is approximately 5.9 years. We had unrecognized share-based compensation expense related to unvested awards is shown in the following table, dollars in thousands: As of March 31, 2023 Unrecognized Compensation Expense on Unvested Awards Weighted Average Remaining Compensation Expense Period RSAs $ 24,835 1.2 Stock options 397 0.5 Total unrecognized compensation expense related to unvested awards $ 25,232 Our RSAs with performance-based conditions are evaluated on a quarterly basis with adjustments to compensation expense based on the likelihood of the performance target being achieved or exceeded. The following table shows the range of payouts and the related expense for our outstanding RSAs with performance-based conditions, in thousands: Payout Ranges and Related Expense RSAs with Performance-Based Conditions Grant Date Fair Value 0% 25% 100% 200% February 16, 2021 $ 2,197 $ - $ 549 $ 2,197 $ 4,394 February 15, 2022 $ 3,097 $ - $ 774 $ 3,097 $ 6,194 February 21, 2023 $ 4,192 $ - $ 1,048 $ 4,192 $ 8,384 During the first quarter of 2023, RSAs with performance-based conditions that were granted on February 17, 2020 vested based on cumulative three-year achievement of 200%. Total compensation expense recognized over the three-year performance period, net of forfeitures, was $5.0 million. The fair value of our RSAs with a market-based condition granted under the 2015 LTIP was determined using a Monte Carlo simulation. The following are key inputs in the Monte Carlo analysis for awards granted in 2023 and 2022: 2023 2022 Measurement period (years) 2.86 2.87 Risk free interest rate 4.42 % 1.76 % Dividend yield 0.00 % 0.00 % Estimated fair value of market-based RSAs at grant date $ 270.64 $ 298.20 |
Business Combinations
Business Combinations | 3 Months Ended |
Mar. 31, 2023 | |
Business Combinations | |
Business Combinations | 11. BUSINESS COMBINATIONS Acquiring businesses is a key part of our ongoing strategy to grow our company and expand our market share. Each acquisition has been accounted for as a business combination under ASC 805, “Business Combinations.” Acquisition related costs for the three months ended March 31, 2023 and 2022, were $1.7 million and $0.9 million, respectively. Acquisition related costs are included in selling, general, and administrative expense in our condensed consolidated statements of operations. On January 26, 2023, we acquired the assets of the residential insulation business of SRI. This installation acquisition enhanced our presence in Georgia, Michigan, Ohio, Florida, Alabama and South Carolina. The purchase price of $45.8 million was funded by cash on hand and we recognized goodwill of $25.4 in connection with this acquisition. As third-party or internal valuations are finalized, certain tax aspects of the foregoing transactions are completed, and customer post-closing reviews are concluded, adjustments may be made to the fair value of assets acquired, and in some cases total purchase price, through the end of each measurement period, generally one year following the applicable acquisition date. The table below provides a summary as of March 31, 2023 for the businesses acquired and paid for with cash during the three months ended March 31, 2022, in thousands: 2022 Acquisitions Date Cash Paid Goodwill Acquired Billings 2/3/2022 $ 7,005 $ 3,313 All others Various 1,500 780 Total $ 8,505 $ 4,093 Goodwill to be recognized in connection with acquisitions is attributable to the synergies expected to be realized and improvements in the businesses after the acquisitions. Primarily all of the $25.4 million and $4.1 million of goodwill recorded from acquisitions completed in the three months ended March 31, 2023 and 2022, respectively, is expected to be deductible for income tax purposes. |
Accrued Liabilities
Accrued Liabilities | 3 Months Ended |
Mar. 31, 2023 | |
Accrued Liabilities. | |
Accrued Liabilities | 12. ACCRUED LIABILITIES The following table sets forth the components of accrued liabilities, in thousands: As of March 31, 2023 December 31, 2022 Accrued liabilities: Salaries, wages, and bonus/commissions $ 52,742 $ 75,901 Income taxes payable 40,740 2,134 Insurance liabilities 28,199 28,870 Customer rebates 11,169 21,561 Deferred revenue 20,738 21,940 Sales and property taxes 15,850 15,757 Interest payable on long-term debt 3,193 12,146 Other 20,716 21,061 Total accrued liabilities $ 193,347 $ 199,370 See Note 3 – Revenue Recognition |
Other Commitments and Contingen
Other Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2023 | |
Other Commitments and Contingencies | |
Other Commitments and Contingencies | 13. OTHER COMMITMENTS AND CONTINGENCIES Litigation Other Matters We also maintain indemnification agreements with our directors and officers that may require us to indemnify them against liabilities that arise by reason of their status or service as directors or officers, except as prohibited by applicable law. We occasionally use performance bonds to ensure completion of our work on certain larger customer contracts that can span multiple accounting periods. Performance bonds generally do not have stated expiration dates; rather, we are released from the bonds as the contractual performance is completed. We also have bonds outstanding for license and insurance. The following table summarizes our outstanding performance, licensing, insurance and other bonds, in thousands: As of March 31, 2023 December 31, 2022 Outstanding bonds: Performance bonds $ 147,468 $ 152,434 Licensing, insurance, and other bonds 25,527 25,439 Total bonds $ 172,995 $ 177,873 |
Accounting Policies (Policies)
Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies | |
Financial Statement Presentation | Financial Statement Presentation. Our condensed consolidated financial statements have been developed in conformity with GAAP, which requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosures of contingent liabilities at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting periods. Actual results could differ materially from these estimates. All intercompany transactions between TopBuild entities have been eliminated. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements In October 2021, the FASB issued ASU 2021-08, “Accounting for Contract Assets and Contract Liabilities from Contracts with Customers”. This standard improves the accounting for acquired revenue contracts with customers in a business combination by addressing diversity in practice and inconsistency related to recognition of an acquired contract liability, as well as payment terms and their effect on subsequent revenue recognized by the acquirer. This standard became effective for us on January 1, 2023, and did not have a material impact to our financial statements upon adoption. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Revenue Recognition | |
Schedule of revenues disaggregated by market and product | Three Months Ended March 31, 2023 2022 Installation Specialty Distribution Eliminations Total Installation Specialty Distribution Eliminations Total Residential $ 645,703 $ 224,326 $ (51,390) $ 818,639 $ 563,303 $ 236,411 $ (43,421) $ 756,293 Commercial/Industrial 121,387 334,049 (8,837) 446,599 113,390 307,451 (8,216) 412,625 Net sales $ 767,090 $ 558,375 $ (60,227) $ 1,265,238 $ 676,693 $ 543,862 $ (51,637) $ 1,168,918 The following table presents our revenues disaggregated by product (in thousands): Three Months Ended March 31, 2023 2022 Installation Specialty Distribution Eliminations Total Installation Specialty Distribution Eliminations Total Insulation and accessories $ 600,767 $ 502,802 $ (51,973) $ 1,051,596 $ 536,341 $ 479,760 $ (43,810) $ 972,291 Glass and windows 63,442 - - 63,442 51,196 - - 51,196 Gutters 28,278 39,842 (7,165) 60,955 22,957 46,631 (7,002) 62,586 All other 74,603 15,731 (1,089) 89,245 66,199 17,471 (825) 82,845 Net sales $ 767,090 $ 558,375 $ (60,227) $ 1,265,238 $ 676,693 $ 543,862 $ (51,637) $ 1,168,918 |
Schedule of contract assets and contract liabilities with customers | The following table represents our contract assets and contract liabilities with customers, in thousands: Included in Line Item on As of Condensed Consolidated March 31, December 31, Balance Sheets 2023 2022 Contract Assets: Receivables, unbilled Receivables, net $ 78,034 $ 75,481 Contract Liabilities: Deferred revenue Accrued liabilities $ 20,738 $ 21,940 |
Goodwill and Other Intangibles
Goodwill and Other Intangibles (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Goodwill and Other Intangibles | |
Changes in the carrying amount of goodwill by segment | Changes in the carrying amount of goodwill for three months ended March 31, 2023, by segment, were as follows, in thousands: Accumulated Gross Goodwill Fx Translation Gross Goodwill Impairment Net Goodwill December 31, 2022 Additions Adjustment March 31, 2023 Losses March 31, 2023 Goodwill, by segment: Installation $ 1,826,979 $ 25,384 $ - $ 1,852,363 $ (762,021) $ 1,090,342 Specialty Distribution 902,036 - 16 902,052 - 902,052 Total goodwill $ 2,729,015 $ 25,384 $ 16 $ 2,754,415 $ (762,021) $ 1,992,394 |
Schedule of other intangible assets | Other intangible assets, net includes customer relationships, non-compete agreements, and trademarks / trade names. The following table sets forth our other intangible assets, in thousands: As of March 31, 2023 December 31, 2022 Gross definite-lived intangible assets $ 791,939 $ 782,316 Accumulated amortization (184,256) (167,349) Net definite-lived intangible assets $ 607,683 $ 614,967 |
Schedule of amortization expense | As of March 31, 2023 December 31, 2022 Gross definite-lived intangible assets $ 791,939 $ 782,316 Accumulated amortization (184,256) (167,349) Net definite-lived intangible assets $ 607,683 $ 614,967 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Long-Term Debt | |
Reconciliation of principal balance of outstanding debt | The following table reconciles the principal balances of our outstanding debt to our condensed consolidated balance sheets, in thousands: As of March 31, 2023 December 31, 2022 3.625% Senior Notes due 2029 $ 400,000 $ 400,000 4.125% Senior Notes due 2032 500,000 500,000 Term loan 558,750 566,250 Equipment notes 6,185 8,427 Unamortized debt issuance costs (16,633) (17,352) Total debt, net of unamortized debt issuance costs 1,448,302 1,457,325 Less: current portion of long-term debt 42,371 40,068 Total long-term debt $ 1,405,931 $ 1,417,257 |
Schedule of remaining principal payments of debt | The following table sets forth our remaining principal payments for our outstanding debt balances as of March 31, 2023, in thousands: 2023 2024 2025 2026 2027 Thereafter Total 3.625% Senior Notes $ - $ - $ - $ - $ - $ 400,000 $ 400,000 4.125% Senior Notes - - - - - 500,000 500,000 Term loan 26,250 45,000 48,750 438,750 - - 558,750 Equipment notes 4,076 2,109 - - - - 6,185 Total $ 30,326 $ 47,109 $ 48,750 $ 438,750 $ - $ 900,000 $ 1,464,935 |
Summary of key terms of the Credit Agreement | The following table outlines the key terms of the Credit Agreement (dollars in thousands): Senior secured term loan facility $ 300,000 Additional delayed draw term loan $ 300,000 Additional term loan and/or revolver capacity available under incremental facility (a) $ 300,000 Revolving facility $ 500,000 Sublimit for issuance of letters of credit under revolving facility (b) $ 100,000 Sublimit for swingline loans under revolving facility (b) $ 35,000 Interest rate as of March 31, 2023 5.91 % Scheduled maturity date 10/7/2026 (a) Additional borrowing capacity is available under the incremental facility, subject to certain terms and conditions (including existing or new lenders providing commitments in respect of such additional borrowing capacity). (b) Use of the sublimits for the issuance of letters of credit and swingline loans reduces the availability under the Revolving Facility. |
Schedule of availability under the Revolving Facility | The following table summarizes our availability under the Revolving Facility, in thousands: As of March 31, 2023 December 31, 2022 Revolving facility $ 500,000 $ 500,000 Less: standby letters of credit (67,689) (67,689) Availability under revolving facility $ 432,311 $ 432,311 |
Schedule of the key financial covenants | As of March 31, 2023 Maximum Net Leverage Ratio 3.50:1.00 Minimum Interest Coverage Ratio 3.00:1.00 Compliance as of period end In Compliance |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Measurements | |
Schedule of fair value of liabilities | As of March 31, 2023 Fair Value Gross Carrying Value 3.625% Senior Notes $ 348,580 $ 400,000 4.125% Senior Notes $ 427,500 $ 500,000 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Segment Information | |
Schedule of net sales and operating results by segment | The following tables set forth our net sales and operating results by segment, in thousands: Three Months Ended March 31, 2023 2022 2023 2022 Net Sales Operating Profit (b) Operations by segment (a): Installation $ 767,090 $ 676,693 $ 146,897 $ 112,679 Specialty Distribution 558,375 543,862 73,333 70,420 Intercompany eliminations (60,227) (51,637) (9,971) (8,708) Total $ 1,265,238 $ 1,168,918 210,259 174,391 General corporate expense, net (c) (10,828) (10,437) Operating profit, as reported 199,431 163,954 Other expense, net (16,116) (11,282) Income before income taxes $ 183,315 $ 152,672 (a) All of our operations are located primarily in the U.S and to a lesser extent Canada. (b) Segment operating profit includes an allocation of general corporate expenses attributable to the operating segments which is based on direct benefit or usage (such as salaries of corporate employees who directly support the segment). (c) General corporate expense, net includes expenses not specifically attributable to our segments for functions such as corporate human resources, finance, and legal, including salaries, benefits, and other related costs . |
Net Income Per Share (Tables)
Net Income Per Share (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Net Income Per Share | |
Schedule of basic and diluted income per share | Basic and diluted net income per share were computed as follows: Three Months Ended March 31, 2023 2022 Net income (in thousands) $ 135,870 $ 114,711 Weighted average number of common shares outstanding - basic 31,550,658 32,738,525 Dilutive effect of common stock equivalents: RSAs with service-based conditions 22,643 15,127 RSAs with market-based conditions 24,861 100,158 RSAs with performance-based conditions 29,031 64,025 Stock options 86,046 124,655 Weighted average number of common shares outstanding - diluted 31,713,239 33,042,490 Basic net income per common share $ 4.31 $ 3.50 Diluted net income per common share $ 4.28 $ 3.47 |
Summary of shares excluded from the calculation of diluted income per share because their effect would have been anti-dilutive | The following table summarizes shares excluded from the calculation of diluted net income per share because their effect would have been anti-dilutive: Three Months Ended March 31, 2023 2022 Anti-dilutive common stock equivalents: RSAs with service-based conditions 11,163 10,244 RSAs with market-based conditions 8,933 382 RSAs with performance-based conditions - 7,908 Stock options 22,280 16,587 Total anti-dilutive common stock equivalents 42,376 35,121 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Compensation | |
Schedule of share-based compensation expense and related income tax benefit | The following table presents share-based compensation amounts recognized in our condensed consolidated statements of operations, in thousands: Three Months Ended March 31, 2023 2022 Share-based compensation expense $ 3,135 $ 3,727 Income tax (expense)/benefit $ (45) $ 1,605 |
Schedule of share-based compensation activity | The following table presents a summary of our share-based compensation activity for three months ended March 31, 2023, in thousands, except per share amounts: RSAs Stock Options Number of Shares Weighted Average Grant Date Fair Value Per Share Number of Shares Weighted Average Grant Date Fair Value Per Share Weighted Average Exercise Price Per Share Aggregate Intrinsic Value Balance December 31, 2022 173.2 $ 195.06 182.2 $ 32.25 $ 86.79 $ 13,992.3 Granted 95.4 $ 202.24 — $ — $ — — Converted/Exercised (95.0) $ 145.57 (28.8) $ 13.07 $ 35.67 $ 4,504.8 Forfeited/Expired (5.3) $ 242.76 — $ — $ — — Balance March 31, 2023 168.3 $ 225.41 153.4 $ 35.98 $ 96.40 $ 17,277.2 Exercisable March 31, 2023 (a) 145.9 $ 33.25 $ 90.39 $ 17,277.2 (a) The weighted average remaining contractual term for vested stock options is approximately 5.9 years. |
Schedule of unrecognized share-based compensation expense relating to unvested awards | We had unrecognized share-based compensation expense related to unvested awards is shown in the following table, dollars in thousands: As of March 31, 2023 Unrecognized Compensation Expense on Unvested Awards Weighted Average Remaining Compensation Expense Period RSAs $ 24,835 1.2 Stock options 397 0.5 Total unrecognized compensation expense related to unvested awards $ 25,232 |
Schedule of key inputs used to estimate the fair value of awards | 2023 2022 Measurement period (years) 2.86 2.87 Risk free interest rate 4.42 % 1.76 % Dividend yield 0.00 % 0.00 % Estimated fair value of market-based RSAs at grant date $ 270.64 $ 298.20 |
Performance-based conditions | Restricted Stock Awards | |
Share-Based Compensation | |
Schedule of the range of payouts and the related expense for RSAs with performance-based conditions | Payout Ranges and Related Expense RSAs with Performance-Based Conditions Grant Date Fair Value 0% 25% 100% 200% February 16, 2021 $ 2,197 $ - $ 549 $ 2,197 $ 4,394 February 15, 2022 $ 3,097 $ - $ 774 $ 3,097 $ 6,194 February 21, 2023 $ 4,192 $ - $ 1,048 $ 4,192 $ 8,384 |
Business Combinations (Tables)
Business Combinations (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
2022 Acquisitions | |
Business Combinations | |
Summary of businesses acquired | 2022 Acquisitions Date Cash Paid Goodwill Acquired Billings 2/3/2022 $ 7,005 $ 3,313 All others Various 1,500 780 Total $ 8,505 $ 4,093 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Accrued Liabilities. | |
Schedule of components of accrued liabilities | The following table sets forth the components of accrued liabilities, in thousands: As of March 31, 2023 December 31, 2022 Accrued liabilities: Salaries, wages, and bonus/commissions $ 52,742 $ 75,901 Income taxes payable 40,740 2,134 Insurance liabilities 28,199 28,870 Customer rebates 11,169 21,561 Deferred revenue 20,738 21,940 Sales and property taxes 15,850 15,757 Interest payable on long-term debt 3,193 12,146 Other 20,716 21,061 Total accrued liabilities $ 193,347 $ 199,370 |
Other Commitments and Conting_2
Other Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Other Commitments and Contingencies | |
Summary of outstanding bonds | The following table summarizes our outstanding performance, licensing, insurance and other bonds, in thousands: As of March 31, 2023 December 31, 2022 Outstanding bonds: Performance bonds $ 147,468 $ 152,434 Licensing, insurance, and other bonds 25,527 25,439 Total bonds $ 172,995 $ 177,873 |
Basis of Presentation (Details)
Basis of Presentation (Details) | 3 Months Ended |
Mar. 31, 2023 segment | |
Summary of Significant Accounting Policies | |
Number of reportable segments | 2 |
Revenue Recognition - Disaggreg
Revenue Recognition - Disaggregation (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Revenue Recognition | ||
Net sales | $ 1,265,238 | $ 1,168,918 |
Insulation and accessories | ||
Revenue Recognition | ||
Net sales | 1,051,596 | 972,291 |
Glass and windows | ||
Revenue Recognition | ||
Net sales | 63,442 | 51,196 |
Gutters | ||
Revenue Recognition | ||
Net sales | 60,955 | 62,586 |
All other | ||
Revenue Recognition | ||
Net sales | 89,245 | 82,845 |
Residential | ||
Revenue Recognition | ||
Net sales | 818,639 | 756,293 |
Commercial and Industrial | ||
Revenue Recognition | ||
Net sales | 446,599 | 412,625 |
Operating Segment | Installation | ||
Revenue Recognition | ||
Net sales | 767,090 | 676,693 |
Operating Segment | Installation | Insulation and accessories | ||
Revenue Recognition | ||
Net sales | 600,767 | 536,341 |
Operating Segment | Installation | Glass and windows | ||
Revenue Recognition | ||
Net sales | 63,442 | 51,196 |
Operating Segment | Installation | Gutters | ||
Revenue Recognition | ||
Net sales | 28,278 | 22,957 |
Operating Segment | Installation | All other | ||
Revenue Recognition | ||
Net sales | 74,603 | 66,199 |
Operating Segment | Installation | Residential | ||
Revenue Recognition | ||
Net sales | 645,703 | 563,303 |
Operating Segment | Installation | Commercial and Industrial | ||
Revenue Recognition | ||
Net sales | 121,387 | 113,390 |
Operating Segment | Specialty Distribution | ||
Revenue Recognition | ||
Net sales | 558,375 | 543,862 |
Operating Segment | Specialty Distribution | Insulation and accessories | ||
Revenue Recognition | ||
Net sales | 502,802 | 479,760 |
Operating Segment | Specialty Distribution | Gutters | ||
Revenue Recognition | ||
Net sales | 39,842 | 46,631 |
Operating Segment | Specialty Distribution | All other | ||
Revenue Recognition | ||
Net sales | 15,731 | 17,471 |
Operating Segment | Specialty Distribution | Residential | ||
Revenue Recognition | ||
Net sales | 224,326 | 236,411 |
Operating Segment | Specialty Distribution | Commercial and Industrial | ||
Revenue Recognition | ||
Net sales | 334,049 | 307,451 |
Eliminations | ||
Revenue Recognition | ||
Net sales | (60,227) | (51,637) |
Eliminations | Insulation and accessories | ||
Revenue Recognition | ||
Net sales | (51,973) | (43,810) |
Eliminations | Gutters | ||
Revenue Recognition | ||
Net sales | (7,165) | (7,002) |
Eliminations | All other | ||
Revenue Recognition | ||
Net sales | (1,089) | (825) |
Eliminations | Residential | ||
Revenue Recognition | ||
Net sales | (51,390) | (43,421) |
Eliminations | Commercial and Industrial | ||
Revenue Recognition | ||
Net sales | $ (8,837) | $ (8,216) |
Revenue Recognition - Other (De
Revenue Recognition - Other (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Dec. 31, 2022 | |
Contract Liabilities | ||
Deferred revenue | $ 20,738 | $ 21,940 |
Uncompleted Performance Obligations | ||
Amount remaining on uncompleted performance obligations | $ 395,500 | |
Expected timing of satisfaction of performance obligations | over the next 18 months | |
Receivables, net | ||
Contract Assets | ||
Receivables, unbilled | $ 78,034 | 75,481 |
Uncompleted Performance Obligations | ||
Retained receivables | 66,700 | 63,000 |
Accrued liabilities | ||
Contract Liabilities | ||
Deferred revenue | $ 20,738 | $ 21,940 |
Goodwill and Other Intangible_2
Goodwill and Other Intangibles - Goodwill (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 USD ($) item | Dec. 31, 2022 USD ($) | Jan. 26, 2023 USD ($) | |
Changes in the carrying amount of goodwill | |||
Number of reporting units | item | 2 | ||
Impairment of goodwill | $ 0 | ||
Gross Goodwill, at beginning of period | $ 2,729,015 | ||
Additions | 25,384 | ||
Fx Translation Adjustment | 16 | ||
Gross Goodwill, at end of period | 2,754,415 | 2,729,015 | |
Accumulated Impairment Losses | (762,021) | ||
Net Goodwill | 1,992,394 | 1,966,994 | $ 25,400 |
Installation | |||
Changes in the carrying amount of goodwill | |||
Gross Goodwill, at beginning of period | 1,826,979 | ||
Additions | 25,384 | ||
Gross Goodwill, at end of period | 1,852,363 | 1,826,979 | |
Accumulated Impairment Losses | (762,021) | ||
Net Goodwill | 1,090,342 | ||
Specialty Distribution | |||
Changes in the carrying amount of goodwill | |||
Gross Goodwill, at beginning of period | 902,036 | ||
Fx Translation Adjustment | 16 | ||
Gross Goodwill, at end of period | 902,052 | $ 902,036 | |
Net Goodwill | $ 902,052 |
Goodwill and Other Intangible_3
Goodwill and Other Intangibles - Other intangible assets (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Other intangible assets | |||
Gross Definite-lived intangible assets | $ 791,939 | $ 782,316 | |
Accumulated Amortization | (184,256) | (167,349) | |
Net definite-lived intangible assets | 607,683 | $ 614,967 | |
Amortization expense | $ 16,896 | $ 17,825 |
Long-Term Debt - Reconciliation
Long-Term Debt - Reconciliation (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Long-Term Debt | ||
Long-term debt | $ 1,464,935 | |
Unamortized debt issuance costs | (16,633) | $ (17,352) |
Total debt, net of unamortized debt issuance costs | 1,448,302 | 1,457,325 |
Less: current portion of long-term debt | 42,371 | 40,068 |
Total long-term debt | $ 1,405,931 | 1,417,257 |
3.625% Senior Notes | ||
Long-Term Debt | ||
Interest rate (as a percent) | 3.625% | |
Long-term debt | $ 400,000 | 400,000 |
4.125% Senior Notes | ||
Long-Term Debt | ||
Interest rate (as a percent) | 4.125% | |
Long-term debt | $ 500,000 | 500,000 |
Term Loan Facility | ||
Long-Term Debt | ||
Long-term debt | 558,750 | 566,250 |
Equipment Notes | ||
Long-Term Debt | ||
Long-term debt | $ 6,185 | $ 8,427 |
Long-Term Debt - Schedule of de
Long-Term Debt - Schedule of debt maturity (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Schedule of Debt Maturity by Years: | ||
2023 | $ 30,326 | |
2024 | 47,109 | |
2025 | 48,750 | |
2026 | 438,750 | |
Thereafter | 900,000 | |
Total | 1,464,935 | |
3.625% Senior Notes | ||
Schedule of Debt Maturity by Years: | ||
Thereafter | 400,000 | |
Total | 400,000 | $ 400,000 |
4.125% Senior Notes | ||
Schedule of Debt Maturity by Years: | ||
Thereafter | 500,000 | |
Total | 500,000 | 500,000 |
Term Loan Facility | ||
Schedule of Debt Maturity by Years: | ||
2023 | 26,250 | |
2024 | 45,000 | |
2025 | 48,750 | |
2026 | 438,750 | |
Total | 558,750 | 566,250 |
Equipment Notes | ||
Schedule of Debt Maturity by Years: | ||
2023 | 4,076 | |
2024 | 2,109 | |
Total | $ 6,185 | $ 8,427 |
Long-Term Debt - Key Terms of C
Long-Term Debt - Key Terms of Credit Agreement (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Dec. 31, 2022 | |
Revolving Facility | ||
Long-Term Debt | ||
Availability | $ 500,000 | $ 500,000 |
Revolving Facility | Minimum | ||
Long-Term Debt | ||
Commitment fee (as a percent) | 0.15% | |
Revolving Facility | Maximum | ||
Long-Term Debt | ||
Commitment fee (as a percent) | 0.275% | |
Credit Agreement | ||
Long-Term Debt | ||
Additional delayed draw term loan | $ 300,000 | |
Additional term loan and/or revolver capacity available under incremental facility | $ 300,000 | |
Scheduled maturity date | Oct. 07, 2026 | |
Credit Agreement | Base Rate Borrowings | Minimum | ||
Long-Term Debt | ||
Applicable margin based on total leverage ratio | 0% | |
Credit Agreement | Base Rate Borrowings | Maximum | ||
Long-Term Debt | ||
Applicable margin based on total leverage ratio | 1.50% | |
Credit Agreement | Base Rate Borrowings | Federal Funds Rate | ||
Long-Term Debt | ||
Basis spread | 0.50% | |
Credit Agreement | Base Rate Borrowings | SOFR | ||
Long-Term Debt | ||
Basis spread | 1% | |
Maturity of the reference rate | 1 month | |
Credit Agreement | SOFR Rate Borrowings | ||
Long-Term Debt | ||
Interest rate floor (as a percent) | 0% | |
Credit Agreement | SOFR Rate Borrowings | Minimum | ||
Long-Term Debt | ||
Applicable margin based on total leverage ratio | 1% | |
Credit Agreement | SOFR Rate Borrowings | Maximum | ||
Long-Term Debt | ||
Applicable margin based on total leverage ratio | 2.50% | |
Credit Agreement | Revolving Facility | ||
Long-Term Debt | ||
Availability | $ 500,000 | |
Sublimit for issuance of letters of credit under Revolving Facility* | 100,000 | |
Sublimit for swingline loans under Revolving Facility* | $ 35,000 | |
Interest rate | 5.91% | |
Credit Agreement | Term Loan Facility | ||
Long-Term Debt | ||
Availability | $ 300,000 |
Long-Term Debt - Revolving Faci
Long-Term Debt - Revolving Facility (Details) - Revolving Facility - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Dec. 31, 2022 | |
Long-Term Debt | ||
Revolving Facility | $ 500,000 | $ 500,000 |
Less: standby letters of credit | (67,689) | (67,689) |
Availability under revolving facility | $ 432,311 | $ 432,311 |
Minimum | ||
Long-Term Debt | ||
Commitment fee (as a percent) | 0.15% | |
Maximum | ||
Long-Term Debt | ||
Commitment fee (as a percent) | 0.275% |
Long-Term Debt - Senior Notes a
Long-Term Debt - Senior Notes and Equipment Notes (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Dec. 31, 2022 | |
Long-Term Debt | ||
Amount outstanding | $ 1,448,302 | $ 1,457,325 |
Debt Instrument Redemption Option Two | Prior to March 15, 2024 | ||
Long-Term Debt | ||
Redemption price as a percentage of principal | 103.625% | |
Debt instrument, conditional redemption, threshold percentage of aggregate principal amount originally issued remains outstanding | 60% | |
Equipment Notes | ||
Long-Term Debt | ||
Principal amount of debt | $ 41,600 | |
Debt term | 5 years | |
Equipment Notes | Minimum | ||
Long-Term Debt | ||
Interest rate (as a percent) | 2.80% | |
Equipment Notes | Maximum | ||
Long-Term Debt | ||
Interest rate (as a percent) | 4.40% | |
3.625% Senior Notes | ||
Long-Term Debt | ||
Interest rate (as a percent) | 3.625% | |
Principal amount of debt | $ 400,000 | |
3.625% Senior Notes | Change in Control Scenario | ||
Long-Term Debt | ||
Redemption price as a percentage of principal | 101% | |
3.625% Senior Notes | Debt Instrument Redemption Option One | Prior to March 15, 2024 | ||
Long-Term Debt | ||
Redemption price as a percentage of principal | 100% | |
3.625% Senior Notes | Debt Instrument Redemption Option Two | Maximum | Prior to March 15, 2024 | ||
Long-Term Debt | ||
Redemption price, percentage of principal amount redeemed | 40% | |
4.125% Senior Notes | ||
Long-Term Debt | ||
Interest rate (as a percent) | 4.125% | |
Principal amount of debt | $ 500,000 | |
4.125% Senior Notes | On or after October 15, 2026 | ||
Long-Term Debt | ||
Redemption price as a percentage of principal | 102.063% | |
4.125% Senior Notes | On or after October 15, 2027 | ||
Long-Term Debt | ||
Redemption price as a percentage of principal | 101.375% | |
4.125% Senior Notes | On or after October 15, 2028 | ||
Long-Term Debt | ||
Redemption price as a percentage of principal | 100.688% | |
4.125% Senior Notes | On October 15, 2029 and thereafter | ||
Long-Term Debt | ||
Redemption price as a percentage of principal | 100% | |
4.125% Senior Notes | Prior to October 15, 2026 | ||
Long-Term Debt | ||
Basis spread on treasury rate | 0.50% | |
4.125% Senior Notes | Prior to October 15, 2024 | ||
Long-Term Debt | ||
Redemption price as a percentage of principal | 104.125% | |
Redemption price, percentage of principal amount redeemed | 40% | |
Debt instrument, conditional redemption, threshold percentage of aggregate principal amount originally issued remains outstanding | 60% | |
4.125% Senior Notes | Change in Control Scenario | ||
Long-Term Debt | ||
Redemption price as a percentage of principal | 101% |
Long-Term Debt - Other (Details
Long-Term Debt - Other (Details) | 3 Months Ended |
Mar. 31, 2023 | |
Debt covenants | |
Maximum Net Leverage Ratio | 3.50 |
Minimum Interest Coverage Ratio | 3 |
Senior Notes | Event of Default Scenario | |
Debt covenants | |
Minimum percentage of principal of debt holders to declare debt immediately due and payable | 30% |
3.625% Senior Notes | |
Debt covenants | |
Interest rate (as a percent) | 3.625% |
4.125% Senior Notes | |
Debt covenants | |
Interest rate (as a percent) | 4.125% |
Fair Value Measurements (Detail
Fair Value Measurements (Details) $ in Thousands | Mar. 31, 2023 USD ($) |
Fair Value on Non-Recurring Basis | |
Amount outstanding | $ 1,464,935 |
3.625% Senior Notes | |
Fair Value on Non-Recurring Basis | |
Interest rate (as a percent) | 3.625% |
Amount outstanding | $ 400,000 |
3.625% Senior Notes | Fair Value on Non-Recurring Basis | Level 1 fair value measurement | |
Fair Value on Non-Recurring Basis | |
Interest rate (as a percent) | 3.625% |
Fair value | $ 348,580 |
4.125% Senior Notes | |
Fair Value on Non-Recurring Basis | |
Interest rate (as a percent) | 4.125% |
Amount outstanding | $ 500,000 |
4.125% Senior Notes | Fair Value on Non-Recurring Basis | Level 1 fair value measurement | |
Fair Value on Non-Recurring Basis | |
Interest rate (as a percent) | 4.125% |
Fair value | $ 427,500 |
Segment Information (Details)
Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Segment information | |||
Net sales | $ 1,265,238 | $ 1,168,918 | |
Operating profit as, reported | 199,431 | 163,954 | |
Other expense, net | (16,116) | (11,282) | |
Income before income taxes | 183,315 | 152,672 | |
Total Assets | 4,700,914 | $ 4,606,831 | |
Operating Segment | |||
Segment information | |||
Operating profit as, reported | 210,259 | 174,391 | |
Operating Segment | Installation | |||
Segment information | |||
Net sales | 767,090 | 676,693 | |
Operating profit as, reported | 146,897 | 112,679 | |
Operating Segment | Specialty Distribution | |||
Segment information | |||
Net sales | 558,375 | 543,862 | |
Operating profit as, reported | 73,333 | 70,420 | |
Eliminations | |||
Segment information | |||
Net sales | (60,227) | (51,637) | |
Intercompany Eliminations | |||
Segment information | |||
Net sales | (60,227) | (51,637) | |
Operating profit as, reported | (9,971) | (8,708) | |
Corporate | |||
Segment information | |||
General corporate expense, net | $ (10,828) | $ (10,437) |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Income Taxes | ||
Effective tax rate (as a percent) | 25.90% | 24.90% |
Benefit related to share-based compensation | $ (45) | $ 1,605 |
Net Income Per Share - Calculat
Net Income Per Share - Calculation (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Net income - basic and diluted | $ 135,870 | $ 114,711 |
Weighted average number of common shares outstanding - basic | 31,550,658 | 32,738,525 |
Dilutive effect of common stock equivalents: | ||
Stock options | 86,046 | 124,655 |
Weighted average number of common shares outstanding - diluted | 31,713,239 | 33,042,490 |
Basic net income per common share | $ 4.31 | $ 3.50 |
Diluted net income per common share | $ 4.28 | $ 3.47 |
Service-based conditions | ||
Dilutive effect of common stock equivalents: | ||
Restricted stock awards | 22,643 | 15,127 |
Market-based conditions | ||
Dilutive effect of common stock equivalents: | ||
Restricted stock awards | 24,861 | 100,158 |
Performance-based conditions | ||
Dilutive effect of common stock equivalents: | ||
Restricted stock awards | 29,031 | 64,025 |
Net Income Per Share - Anti-dil
Net Income Per Share - Anti-dilutive common stock equivalents (Details) - shares | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Anti-dilutive common stock equivalents | ||
Total anti-dilutive common stock equivalents | 42,376 | 35,121 |
Restricted Stock Awards | Service-based conditions | ||
Anti-dilutive common stock equivalents | ||
Total anti-dilutive common stock equivalents | 11,163 | 10,244 |
Restricted Stock Awards | Market-based conditions | ||
Anti-dilutive common stock equivalents | ||
Total anti-dilutive common stock equivalents | 8,933 | 382 |
Restricted Stock Awards | Performance-based conditions | ||
Anti-dilutive common stock equivalents | ||
Total anti-dilutive common stock equivalents | 7,908 | |
Stock Options | ||
Anti-dilutive common stock equivalents | ||
Total anti-dilutive common stock equivalents | 22,280 | 16,587 |
Share-Based Compensation - Expe
Share-Based Compensation - Expense (Details) - USD ($) $ in Thousands, shares in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Share-Based Compensation | ||
Share-based compensation expense | $ 3,135 | $ 3,727 |
Income tax (expense) benefit | $ (45) | $ 1,605 |
2015 Plan | Maximum | ||
Share-Based Compensation | ||
Number of shares authorized | 4 |
Share-Based Compensation - Acti
Share-Based Compensation - Activity (Details) - USD ($) | 3 Months Ended | |||||
Feb. 21, 2023 | Feb. 15, 2022 | Feb. 16, 2021 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Stock Options, Number of Shares | ||||||
Converted/Exercised (in shares) | (28,840) | (12,269) | ||||
Stock options, additional disclosures | ||||||
Weighted average remaining contractual term for vested stock options | 5 years 10 months 24 days | |||||
Unrecognized share-based compensation expense | ||||||
Total unrecognized compensation expense related to unvested awards | $ 25,232,000 | |||||
Restricted Stock Awards | ||||||
Restricted Stock Awards, Number of Shares | ||||||
Balance at beginning of period (in shares) | 173,200 | |||||
Granted (in shares) | 95,400 | |||||
Converted/Exercised (in shares) | (95,000) | |||||
Forfeited/Expired (in shares) | (5,300) | |||||
Balance at end of period (in shares) | 168,300 | |||||
Restricted Stock Awards, Weighted Average Grant Date Fair Value Per Share | ||||||
Balance at beginning of period (in dollars per share) | $ 195.06 | |||||
Granted (in dollars per share) | 202.24 | |||||
Converted/Exercised (in dollars per share) | 145.57 | |||||
Forfeited/Expired (in dollars per share) | 242.76 | |||||
Balance at end of period (in dollars per share) | $ 225.41 | |||||
Unrecognized share-based compensation expense | ||||||
RSAs, Unrecognized Compensation Expense on Unvested Awards | $ 24,835,000 | |||||
Weighted Average Remaining Compensation Expense Period | 1 year 2 months 12 days | |||||
Assumptions used to estimate the fair values of the awards granted: | ||||||
Measurement period (years) | 2 years 10 months 9 days | 2 years 10 months 13 days | ||||
Risk free interest rate (as a percent) | 4.42% | 1.76% | ||||
Dividend yield (as a percent) | 0% | 0% | ||||
Estimated fair value of market-based RSAs at grant date (in dollars per share) | $ 270.64 | $ 298.20 | ||||
Restricted Stock Awards | Performance-based conditions | ||||||
Restricted stock awards, additional disclosures | ||||||
Grant date fair value | $ 4,192,000 | $ 3,097,000 | $ 2,197,000 | |||
Restricted Stock Awards | Performance-based conditions | Payout Range-0% | ||||||
Restricted stock awards, additional disclosures | ||||||
Payout range (as a percent) | 0% | 0% | 0% | |||
Restricted Stock Awards | Performance-based conditions | Payout Range-25% | ||||||
Restricted stock awards, additional disclosures | ||||||
Payout range (as a percent) | 25% | 25% | 25% | |||
Related expenses | $ 1,048,000 | $ 774,000 | $ 549,000 | |||
Restricted Stock Awards | Performance-based conditions | Payout Range-100% | ||||||
Restricted stock awards, additional disclosures | ||||||
Payout range (as a percent) | 100% | 100% | 100% | |||
Related expenses | $ 4,192,000 | $ 3,097,000 | $ 2,197,000 | |||
Restricted Stock Awards | Performance-based conditions | Payout Range-200% | ||||||
Restricted stock awards, additional disclosures | ||||||
Payout range (as a percent) | 200% | 200% | 200% | |||
Related expenses | $ 8,384,000 | $ 6,194,000 | $ 4,394,000 | |||
RSAs granted February 17, 2020 | Performance-based conditions | ||||||
Restricted stock awards, additional disclosures | ||||||
Cumulative period of achievement | 3 years | |||||
Cumulative achievement percentage | 200% | |||||
Total compensation expense recognized over the performance period, net of forfeitures | $ 5,000,000 | |||||
Stock Options | ||||||
Stock Options, Number of Shares | ||||||
Balance at beginning of period (in shares) | 182,200 | |||||
Converted/Exercised (in shares) | (28,800) | |||||
Balance at end of period (in shares) | 153,400 | |||||
Stock Options, Weighted Average Grant Date Fair Value Per Share | ||||||
Balance at beginning of period (in dollars per share) | $ 32.25 | |||||
Converted/Exercised (in dollars per share) | 13.07 | |||||
Balance at end of period (in dollars per share) | 35.98 | |||||
Stock Options, Weighted Average Exercise Price Per Share | ||||||
Balance at beginning of period (in dollars per share) | 86.79 | |||||
Converted/Exercised (in dollars per share) | 35.67 | |||||
Balance at end of period (in dollars per share) | $ 96.40 | |||||
Stock options, additional disclosures | ||||||
Aggregate intrinsic value | $ 17,277,200 | $ 13,992,300 | ||||
Converted/Exercised aggregate intrinsic value | $ 4,504,800 | |||||
Exercisable, Number of shares | 145,900 | |||||
Exercisable, Weighted Average Grant Date Fair Value Per Share | $ 33.25 | |||||
Exercisable Weighted Average Exercise Price Per Share | $ 90.39 | |||||
Exercisable, Aggregate Intrinsic Value | $ 17,277,200 | |||||
Unrecognized share-based compensation expense | ||||||
Stock options, Unrecognized Compensation Expense on Unvested Awards | $ 397,000 | |||||
Weighted Average Remaining Compensation Expense Period | 6 months |
Business Combinations - Summary
Business Combinations - Summary (Details) - USD ($) $ in Thousands | 3 Months Ended | ||||
Jan. 26, 2023 | Feb. 23, 2022 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Business Combinations | |||||
Acquisition related costs | $ 1,700 | $ 900 | |||
Goodwill | $ 25,400 | 1,992,394 | $ 1,966,994 | ||
Summary of businesses acquired: | |||||
Goodwill | 25,400 | 1,992,394 | 1,966,994 | ||
Goodwill expected to be deducted for income tax purposes | 25,400 | 4,100 | |||
Estimated fair values | |||||
Goodwill | 25,400 | $ 1,992,394 | $ 1,966,994 | ||
SRI Holdings | |||||
Business Combinations | |||||
Purchase price | $ 45,800 | ||||
2022 Acquisitions | |||||
Summary of businesses acquired: | |||||
Cash Paid | 8,505 | ||||
Goodwill Acquired | 4,093 | ||||
Billings | |||||
Summary of businesses acquired: | |||||
Cash Paid | $ 7,005 | ||||
Goodwill Acquired | $ 3,313 | ||||
All others | |||||
Summary of businesses acquired: | |||||
Cash Paid | 1,500 | ||||
Goodwill Acquired | $ 780 |
Accrued Liabilities (Details)
Accrued Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Accrued Liabilities. | ||
Salaries, wages, and bonus/commissions | $ 52,742 | $ 75,901 |
Income taxes payable | 40,740 | 2,134 |
Insurance liabilities | 28,199 | 28,870 |
Customer rebates | 11,169 | 21,561 |
Deferred revenue | 20,738 | 21,940 |
Sales and property taxes | 15,850 | 15,757 |
Interest payable on long-term debt | 3,193 | 12,146 |
Other | 20,716 | 21,061 |
Total accrued liabilities | $ 193,347 | $ 199,370 |
Other Commitments and Conting_3
Other Commitments and Contingencies (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Outstanding Bonds | ||
Performance bonds | $ 147,468 | $ 152,434 |
Licensing, insurance, and other bonds | 25,527 | 25,439 |
Total bonds | $ 172,995 | $ 177,873 |