Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2024 | Apr. 30, 2024 | |
Cover page. | ||
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2024 | |
Document Transition Report | false | |
Entity File Number | 001-36870 | |
Entity Registrant Name | TopBuild Corp | |
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 $0.01 per share | |
Trading Symbol | BLD | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 31,817,709 | |
Amendment Flag | false | |
Entity Central Index Key | 0001633931 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q1 | |
Document Quarterly Report | true |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 968,809 | $ 848,565 |
Receivables, net of an allowance for credit losses of $23,948 at March 31, 2024, and $23,948 at December 31, 2023 | 829,221 | 799,009 |
Inventories | 375,056 | 364,731 |
Prepaid expenses and other current assets | 29,376 | 36,939 |
Total current assets | 2,202,462 | 2,049,244 |
Right of use assets | 201,392 | 204,629 |
Property and equipment, net | 266,422 | 264,487 |
Goodwill | 2,052,319 | 2,042,568 |
Other intangible assets, net | 578,335 | 591,058 |
Other assets | 9,522 | 10,865 |
Total assets | 5,310,452 | 5,162,851 |
Current liabilities: | ||
Accounts payable | 467,863 | 469,585 |
Current portion of long-term debt | 46,230 | 47,039 |
Accrued liabilities | 201,402 | 187,217 |
Short-term operating lease liabilities | 67,041 | 65,780 |
Short-term finance lease liabilities | 1,829 | 1,917 |
Total current liabilities | 784,365 | 771,538 |
Long-term debt | 1,362,498 | 1,373,028 |
Deferred tax liabilities, net | 243,622 | 243,930 |
Long-term portion of insurance reserves | 60,179 | 58,783 |
Long-term operating lease liabilities | 142,552 | 146,213 |
Long-term finance lease liabilities | 3,716 | 4,150 |
Other liabilities | 1,487 | 1,554 |
Total liabilities | 2,598,419 | 2,599,196 |
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; 39,549,030 shares issued and 31,818,099 outstanding at March 31, 2024, and 39,492,037 shares issued and 31,776,039 outstanding at December 31, 2023 | 395 | 394 |
Treasury stock, 7,730,931 shares at March 31, 2024, and 7,715,998 shares at December 31, 2023, at cost | (705,386) | (699,327) |
Additional paid-in capital | 912,481 | 906,334 |
Retained earnings | 2,523,300 | 2,370,919 |
Accumulated other comprehensive loss | (18,757) | (14,665) |
Total equity | 2,712,033 | 2,563,655 |
Total liabilities and equity | $ 5,310,452 | $ 5,162,851 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
CONSOLIDATED BALANCE SHEETS | ||
Allowance for credit losses | $ 22,398 | $ 23,948 |
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 | 39,549,030 | 39,492,037 |
Common stock, shares outstanding | 31,818,099 | 31,776,039 |
Treasury stock, shares at cost | 7,730,931 | 7,715,998 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
CONSOLIDATED STATEMENTS OF OPERATIONS | ||
Net sales | $ 1,278,717 | $ 1,265,238 |
Cost of sales | 891,567 | 895,023 |
Gross profit | 387,150 | 370,215 |
Selling, general, and administrative expense | 172,642 | 170,784 |
Operating profit | 214,508 | 199,431 |
Other income (expense), net: | ||
Interest expense | (18,795) | (18,039) |
Other, net | 11,282 | 1,923 |
Other expense, net | (7,513) | (16,116) |
Income before income taxes | 206,995 | 183,315 |
Income tax expense | (54,614) | (47,445) |
Net income | $ 152,381 | $ 135,870 |
Net income per common share: | ||
Basic | $ 4.82 | $ 4.31 |
Diluted | $ 4.79 | $ 4.28 |
Weighted average shares outstanding: | ||
Basic | 31,641,454 | 31,550,658 |
Diluted | 31,843,818 | 31,713,239 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||
Net income | $ 152,381 | $ 135,870 |
Other comprehensive (loss) income: | ||
Foreign currency translation adjustment | (4,092) | 1,753 |
Comprehensive income | $ 148,289 | $ 137,623 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Cash Flows Provided by (Used in) Operating Activities: | ||
Net income | $ 152,381 | $ 135,870 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 34,257 | 32,100 |
Share-based compensation | 5,127 | 3,135 |
(Gain)/loss on sale of assets | (561) | 185 |
Amortization of debt issuance costs | 720 | 720 |
Provision for bad debt expense | 4,464 | 1,338 |
Provision for inventory obsolescence | 2,902 | 1,642 |
Deferred income taxes, net | (240) | 563 |
Change in certain assets and liabilities: | ||
Receivables, net | (28,486) | (10,847) |
Inventories | (12,056) | 20,096 |
Prepaid expenses and other current assets | 7,541 | 11,579 |
Accounts payable | (2,659) | (25,480) |
Accrued liabilities | 16,170 | (3,339) |
Other, net | (783) | 2,239 |
Net cash provided by operating activities | 178,777 | 169,801 |
Cash Flows Provided by (Used in) Investing Activities: | ||
Purchases of property and equipment | (19,881) | (15,580) |
Acquisition of businesses, net of cash acquired | (22,240) | (45,845) |
Proceeds from sale of assets | 1,608 | 455 |
Net cash used in investing activities | (40,513) | (60,970) |
Cash Flows Provided by (Used in) Financing Activities: | ||
Repayment of long-term debt | (12,059) | (9,743) |
Taxes withheld and paid on employees' equity awards | (6,059) | (6,350) |
Exercise of stock options | 1,020 | 1,029 |
Net cash (used in) provided by financing activities | (17,098) | (15,064) |
Cash and Cash Equivalents | ||
Impact of exchange rate changes on cash | (922) | (58) |
Net increase in cash and cash equivalents | 120,244 | 93,709 |
Cash and cash equivalents- Beginning of period | 848,565 | 240,069 |
Cash and cash equivalents- End of period | 968,809 | 333,778 |
Supplemental disclosure of noncash activities: | ||
Leased assets obtained in exchange for new operating lease liabilities | 13,737 | 18,271 |
Accruals for property and equipment | $ 307 | $ 835 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock | Treasury Stock at Cost | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive (Loss) Income | Total |
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 (loss), 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 |
Balance at Dec. 31, 2023 | 394 | (699,327) | 906,334 | 2,370,919 | (14,665) | 2,563,655 |
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 152,381 | 152,381 | ||||
Share-based compensation | 5,127 | 5,127 | ||||
Issuance of restricted share awards under long-term equity incentive plan, net of forfeitures | 1 | 1 | ||||
Shares withheld to pay taxes on employees' equity awards | (6,059) | (6,059) | ||||
Shares issued upon exercise of stock options | 1,020 | 1,020 | ||||
Other comprehensive income (loss), net of tax | (4,092) | (4,092) | ||||
Balance at Mar. 31, 2024 | $ 395 | $ (705,386) | $ 912,481 | $ 2,523,300 | $ (18,757) | $ 2,712,033 |
CONSOLIDATED STATEMENTS OF CH_2
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Parenthetical) - $ / shares | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Issuance of restricted share awards under long-term equity incentive plan, net of forfeitures (in shares) | 51,236 | 95,012 |
Number of shares withheld to pay taxes on employees' equity awards (in shares) | 14,933 | 32,594 |
Shares issued upon exercise of stock options (in shares) | 5,757 | 28,840 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2024 | |
Basis of Presentation | |
Basis of Presentation | 1. BASIS OF PRESENTATION TopBuild 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, 2024, our results of operations and comprehensive income for the three months ended March 31, 2024 and 2023, and our cash flows for the three months ended March 31, 2024 and 2023. The condensed consolidated balance sheet at December 31, 2023 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, 2023 |
Accounting Policies
Accounting Policies | 3 Months Ended |
Mar. 31, 2024 | |
Accounting Policies | |
Accounting Policies | 2. ACCOUNTING POLICIES Financial Statement Presentation. 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 improved 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. Recently Issued Accounting Pronouncements Not Yet Adopted In November 2023, the FASB issued ASU 2023-07, “Segment Reporting (Topic 280), Improvements to Reportable Segment Disclosures”. This standard amends Topic 280 to require all entities to disclose, on an annual and interim basis, significant segment expenses and an amount for other segment items by reportable segment. This standard is effective for fiscal years beginning after December 15, 2023, with early adoption permitted. We do not anticipate that this standard will affect our consolidated results of operations, financial position or cash flows and we are assessing the impact of adoption in our disclosures to the consolidated financial statements. In December 2023, the FASB issued ASU 2023-09, “Income Taxes (Topic 740), Improvements to Income Tax Disclosures”. This standard amends Topic 740 to require all entities to disclose specific categories in the rate reconciliation, income taxes paid and other income tax information. This standard is effective for fiscal years beginning after December 15, 2024, with early adoption permitted and should be applied on a prospective basis. We do not anticipate that this standard will affect our consolidated results of operations, financial position or cash flows and we are assessing the impact of its adoption in our disclosures to our consolidated financial statements . |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Mar. 31, 2024 | |
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 tables present our revenues disaggregated by market (in thousands): Three Months Ended March 31, 2024 2023 Installation Specialty Distribution Eliminations Total Installation Specialty Distribution Eliminations Total Residential $ 674,436 $ 216,397 $ (55,990) $ 834,843 $ 645,703 $ 224,326 $ (51,390) $ 818,639 Commercial/Industrial 124,307 329,397 (9,830) 443,874 121,387 334,049 (8,837) 446,599 Net sales $ 798,743 $ 545,794 $ (65,820) $ 1,278,717 $ 767,090 $ 558,375 $ (60,227) $ 1,265,238 The following tables present our revenues disaggregated by product (in thousands): Three Months Ended March 31, 2024 2023 Installation Specialty Distribution Eliminations Total Installation Specialty Distribution Eliminations Total Insulation and accessories $ 643,650 $ 490,669 $ (57,509) $ 1,076,810 $ 600,767 $ 502,802 $ (51,973) $ 1,051,596 Glass and windows 58,117 - - 58,117 63,442 - - 63,442 Gutters 27,967 40,316 (7,309) 60,974 28,278 39,842 (7,165) 60,955 All other 69,009 14,809 (1,002) 82,816 74,603 15,731 (1,089) 89,245 Net sales $ 798,743 $ 545,794 $ (65,820) $ 1,278,717 $ 767,090 $ 558,375 $ (60,227) $ 1,265,238 The following table represents our contract assets and contract liabilities with customers, in thousands: Included in Line Item on As of March 31, December 31, Condensed Consolidated Balance Sheets 2024 2023 Contract Assets: Receivables, unbilled Receivables, net $ 70,591 $ 64,882 Contract Liabilities: Deferred revenue Accrued liabilities $ 15,716 $ 18,365 The aggregate amount remaining on uncompleted performance obligations was $392.4 million as of March 31, 2024. 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. Retainage receivables are classified as a component of Receivables, net on our condensed consolidated balance sheets and were $82.2 million and $81.9 million as of March 31, 2024 and December 31, 2023, respectively. |
Goodwill and Other Intangibles
Goodwill and Other Intangibles | 3 Months Ended |
Mar. 31, 2024 | |
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 such unit and determination of its fair value. 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 2023, 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, 2024. Changes in the carrying amount of goodwill for the three months ended March 31, 2024, by segment, were as follows, in thousands: Accumulated Gross Goodwill FX Translation Gross Goodwill Impairment Net Goodwill December 31, 2023 Additions Adjustment March 31, 2024 Losses March 31, 2024 Goodwill, by segment: Installation $ 1,901,160 $ 4,916 $ - $ 1,906,076 $ (762,021) $ 1,144,055 Specialty Distribution 903,429 6,261 (1,426) 908,264 - 908,264 Total goodwill $ 2,804,589 $ 11,177 $ (1,426) $ 2,814,340 $ (762,021) $ 2,052,319 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, 2024 December 31, 2023 Gross definite-lived intangible assets $ 832,327 $ 827,793 Accumulated amortization (253,992) (236,735) Other intangible assets, net $ 578,335 $ 591,058 The following table sets forth our amortization expense, in thousands: Three Months Ended March 31, 2024 2023 Amortization expense $ 17,686 $ 16,896 |
Long-Term Debt
Long-Term Debt | 3 Months Ended |
Mar. 31, 2024 | |
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, 2024 December 31, 2023 3.625% Senior Notes due 2029 $ 400,000 $ 400,000 4.125% Senior Notes due 2032 500,000 500,000 Term loan due 2026 521,250 532,500 Equipment notes 1,230 2,039 Unamortized debt issuance costs (13,752) (14,472) Total debt, net of unamortized debt issuance costs 1,408,728 1,420,067 Less: current portion of long-term debt 46,230 47,039 Total long-term debt $ 1,362,498 $ 1,373,028 The following table sets forth our remaining principal payments for our outstanding debt balances as of March 31, 2024, in thousands: 2024 2025 2026 2027 2028 Thereafter Total 3.625% Senior Notes $ - $ - $ - $ - $ - $ 400,000 $ 400,000 4.125% Senior Notes - - - - - 500,000 500,000 Term loan 33,750 48,750 438,750 - - - 521,250 Equipment notes 1,230 - - - - - 1,230 Total $ 34,980 $ 48,750 $ 438,750 $ - $ - $ 900,000 $ 1,422,480 Credit Agreement On July 26, 2023, we entered into Amendment No. 4 to our Credit Agreement, which provided for a new $550.0 million Term Facility Two, the proceeds of which were intended to be used, in part, to finance the acquisition of SPI, including the payment of related fees and expenses. Refer to Note 14 – Subsequent Events . The following table outlines the key terms of the Credit Agreement (dollars in thousands): Senior secured term loan facility $ 600,000 Revolving facility (a) $ 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 as of March 31, 2024 6.43 % Scheduled maturity date 10/7/2026 (a) Use of the sublimits for the issuance of letters of credit and swingline loans reduces the availability under the revolving facility. Interest expense 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 (Term Facility One); 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 for Term Facility One and in the case of SOFR rate borrowings, the applicable margin ranges from 1.00 percent to 2.50 percent for Term Facility One. 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, 2024 December 31, 2023 Revolving facility $ 500,000 $ 500,000 Less: standby letters of credit (63,770) (63,770) Availability under revolving facility $ 436,230 $ 436,230 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. 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, 2024. The balance of equipment notes, which were issued for the purpose of financing vehicles and equipment, was $1.2 million as of March 31, 2024. The Company’s equipment notes each have a five year term maturing in 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, 2024 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, 2024 | |
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. We measure our contingent consideration . Fair Value on Non-Recurring Basis Fair value measurements were applied to our long-term debt portfolio. As of March 31, 2024 Fair Value Gross Carrying Value 3.625% Senior Notes $ 364,940 $ 400,000 4.125% Senior Notes $ 445,000 $ 500,000 |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2024 | |
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, 2024 2023 2024 2023 Net Sales Operating Profit (b) Operations by segment (a): Installation $ 798,743 $ 767,090 $ 156,757 $ 146,897 Specialty Distribution 545,794 558,375 77,579 73,333 Intercompany eliminations (65,820) (60,227) (10,761) (9,971) Total $ 1,278,717 $ 1,265,238 223,575 210,259 General corporate expense, net (c) (9,067) (10,828) Operating profit, as reported 214,508 199,431 Other expense, net (7,513) (16,116) Income before income taxes $ 206,995 $ 183,315 (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, 2024 | |
Income Taxes | |
Income Taxes | 8. INCOME TAXES Our effective tax rates were 26.4 percent and 25.9 percent for the three months ended March 31, 2024 and March 31, 2023, respectively. The higher 2024 tax rate was primarily related to an increase in tax expense related to share-based compensation. A tax expense of $2.0 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, 2024. |
Net Income Per Share
Net Income Per Share | 3 Months Ended |
Mar. 31, 2024 | |
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, 2024 2023 Net income (in thousands) $ 152,381 $ 135,870 Weighted average number of common shares outstanding - basic 31,641,454 31,550,658 Dilutive effect of common stock equivalents: RSAs with service-based conditions 41,832 22,643 RSAs with market-based conditions 50,955 24,861 RSAs with performance-based conditions 14,429 29,031 Stock options 95,148 86,046 Weighted average number of common shares outstanding - diluted 31,843,818 31,713,239 Basic net income per common share $ 4.82 $ 4.31 Diluted net income per common share $ 4.79 $ 4.28 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, 2024 2023 Anti-dilutive common stock equivalents: RSAs with service-based conditions 14 11,163 RSAs with market-based conditions - 8,933 RSAs with performance-based conditions - - Stock options - 22,280 Total anti-dilutive common stock equivalents 14 42,376 |
Share-Based Compensation
Share-Based Compensation | 3 Months Ended |
Mar. 31, 2024 | |
Share-Based Compensation. | |
Share-Based Compensation | 10. SHARE-BASED COMPENSATION Eligible employees participate in the 2015 LTIP, which 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, 2024, we had 1.7 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, 2024 2023 Share-based compensation expense $ 5,127 $ 3,135 Income tax expense $ (2,009) $ (45) The following table presents a summary of our share-based compensation activity for the three months ended March 31, 2024, 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, 2023 195.5 $ 223.49 128.7 $ 36.65 $ 98.58 $ 35,462.8 Granted 42.6 $ 419.56 — $ — $ — — Converted/Exercised (48.2) $ 230.09 (5.8) $ 70.25 $ 177.53 $ 1,355.3 Forfeited/Expired (2.2) $ 276.34 — $ — $ — — Balance March 31, 2024 187.7 $ 265.84 122.9 $ 35.08 $ 94.88 $ 42,498.1 Exercisable March 31, 2024 (a) 122.9 $ 35.08 $ 94.88 $ 42,498.1 (a) The weighted average remaining contractual term for vested stock options is approximately 5.1 years. We have unrecognized share-based compensation expense related to unvested awards as shown in the following table, dollars in thousands: As of March 31, 2024 Unrecognized Compensation Expense on Unvested Awards Weighted Average Remaining Compensation Expense Period RSAs $ 31,455 1.2 Stock options — — Total unrecognized compensation expense related to unvested awards $ 31,455 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 15, 2022 $ 2,986 $ - $ 747 $ 2,986 $ 5,972 February 21, 2023 $ 4,054 $ - $ 1,014 $ 4,054 $ 8,108 February 21, 2024 $ 4,846 $ - $ 1,212 $ 4,846 $ 9,692 During the first quarter of 2024, RSAs with performance-based conditions that were granted on February 16, 2021 vested based on cumulative three-year achievement of 200%. Total compensation expense recognized over the three-year performance period, net of forfeitures, was $4.4 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 2024, 2023, and 2022: 2024 2023 2022 Measurement period (years) 2.86 2.86 2.87 Risk free interest rate 4.36 % 4.42 % 1.76 % Dividend yield 0.00 % 0.00 % 0.00 % Estimated fair value of market-based RSAs at grant date $ 503.68 $ 270.64 $ 298.20 |
Business Combinations
Business Combinations | 3 Months Ended |
Mar. 31, 2024 | |
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 were $0.5 million and $1.7 million in the three months ended March 31, 2024 and 2023, respectively. Acquisition related costs are included in selling, general, and administrative expense in our condensed consolidated statements of operations. On February 15, 2024, we acquired the assets of the residential and light commercial insulation business Brabble. This installation acquisition enhanced our presence in North Carolina. The purchase price of $5.4 million was funded by cash on hand and we recognized $3.0 million of goodwill in connection with this acquisition. On March 1, 2024, we acquired the assets of the residential insulation business Morris Black. This installation acquisition enhanced our presence in the Pennsylvania market. The purchase price of $3.6 million was funded by cash on hand and we recognized $2.0 million of goodwill in connection with this acquisition. On March 1, 2024, we acquired the assets of the customized insulation products and accessories business PCI. This specialty distribution acquisition has a national customer base focused on the domestic pest control industry. The purchase price of $13.3 million was funded by cash on hand and we recognized $6.3 million of goodwill in connection with this acquisition. The estimate of acquired customer relationships related to our 2024 acquisitions was $6.0 million and the weighted average useful life is 12 years. 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. During the three months ended March 31, 2023, we acquired SRI and the purchase price of $45.3 was funded by cash on hand and we recognized goodwill of $23.1 million in connection with this acquisition. 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 $11.2 million and $23.1 million of goodwill recorded from acquisitions completed in the three months ended March 31, 2024 and 2023, respectively, is expected to be deductible for income tax purposes. |
Accrued Liabilities
Accrued Liabilities | 3 Months Ended |
Mar. 31, 2024 | |
Accrued Liabilities. | |
Accrued Liabilities | 12. ACCRUED LIABILITIES The following table sets forth the components of accrued liabilities, in thousands: As of March 31, 2024 December 31, 2023 Accrued liabilities: Salaries, wages, and bonus/commissions $ 53,145 $ 67,471 Income tax payable 46,554 389 Insurance liabilities 31,197 29,920 Sales and property taxes 15,986 17,002 Deferred revenue 15,716 18,365 Customer rebates 12,177 17,326 Interest payable on long-term debt 3,357 12,139 Other 23,270 24,605 Total accrued liabilities $ 201,402 $ 187,217 See Note 3 – Revenue Recognition |
Other Commitments and Contingen
Other Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2024 | |
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, 2024 December 31, 2023 Outstanding bonds: Performance bonds $ 141,380 $ 145,982 Licensing, insurance, and other bonds 27,979 27,415 Total bonds $ 169,359 $ 173,397 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2024 | |
Subsequent Events | |
Subsequent Events | 14. SUBSEQUENT EVENTS On April 22, 2024, we agreed to a mutual termination of our previous agreement to acquire SPI, originally announced on July 27, 2023. We withdrew our Hart-Scott Rodino filings and were required to pay a termination fee of $23.0 million to the seller under the terms of the purchase agreement. In connection with the termination of the SPI acquisition, the Company terminated the commitments with respect to its undrawn Term Facility Two which was provided pursuant to Amendment No. 4. All other terms of the Company’s Credit Agreement, as amended, remain in full force and effect. On May 3, 2024, our Board authorized the 2024 Repurchase Program, pursuant to which the Company may purchase up to $1.0 billion of our common stock. Share repurchases may be executed through various means including open market purchases, privately negotiated transactions, accelerated share repurchase transactions, or other available means. The 2024 Repurchase Program does not obligate the Company to purchase any shares and has no expiration date. Authorization for the 2024 Repurchase Program may be terminated, increased, or decreased by the Board at its discretion at any time. On May 3, 2024, we entered into an agreement to acquire the assets of the residential insulation business Insulation Works, Inc., which is expected to close in mid-May 2024. This installation acquisition will enhance our presence in the Arkansas market and extend our expertise to the agricultural market. The purchase price of approximately $25.2 million is expected to be funded by cash on hand. This acquisition will be accounted for as a business combination under ASC 805, “Business Combinations.” |
Accounting Policies (Policies)
Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2024 | |
Accounting Policies | |
Financial Statement Presentation | Financial Statement Presentation. |
Recently Adopted and Issued 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 improved 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. Recently Issued Accounting Pronouncements Not Yet Adopted In November 2023, the FASB issued ASU 2023-07, “Segment Reporting (Topic 280), Improvements to Reportable Segment Disclosures”. This standard amends Topic 280 to require all entities to disclose, on an annual and interim basis, significant segment expenses and an amount for other segment items by reportable segment. This standard is effective for fiscal years beginning after December 15, 2023, with early adoption permitted. We do not anticipate that this standard will affect our consolidated results of operations, financial position or cash flows and we are assessing the impact of adoption in our disclosures to the consolidated financial statements. In December 2023, the FASB issued ASU 2023-09, “Income Taxes (Topic 740), Improvements to Income Tax Disclosures”. This standard amends Topic 740 to require all entities to disclose specific categories in the rate reconciliation, income taxes paid and other income tax information. This standard is effective for fiscal years beginning after December 15, 2024, with early adoption permitted and should be applied on a prospective basis. We do not anticipate that this standard will affect our consolidated results of operations, financial position or cash flows and we are assessing the impact of its adoption in our disclosures to our consolidated financial statements . |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Revenue Recognition | |
Schedule of revenues disaggregated by market and product | The following tables present our revenues disaggregated by market (in thousands): Three Months Ended March 31, 2024 2023 Installation Specialty Distribution Eliminations Total Installation Specialty Distribution Eliminations Total Residential $ 674,436 $ 216,397 $ (55,990) $ 834,843 $ 645,703 $ 224,326 $ (51,390) $ 818,639 Commercial/Industrial 124,307 329,397 (9,830) 443,874 121,387 334,049 (8,837) 446,599 Net sales $ 798,743 $ 545,794 $ (65,820) $ 1,278,717 $ 767,090 $ 558,375 $ (60,227) $ 1,265,238 The following tables present our revenues disaggregated by product (in thousands): Three Months Ended March 31, 2024 2023 Installation Specialty Distribution Eliminations Total Installation Specialty Distribution Eliminations Total Insulation and accessories $ 643,650 $ 490,669 $ (57,509) $ 1,076,810 $ 600,767 $ 502,802 $ (51,973) $ 1,051,596 Glass and windows 58,117 - - 58,117 63,442 - - 63,442 Gutters 27,967 40,316 (7,309) 60,974 28,278 39,842 (7,165) 60,955 All other 69,009 14,809 (1,002) 82,816 74,603 15,731 (1,089) 89,245 Net sales $ 798,743 $ 545,794 $ (65,820) $ 1,278,717 $ 767,090 $ 558,375 $ (60,227) $ 1,265,238 |
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 March 31, December 31, Condensed Consolidated Balance Sheets 2024 2023 Contract Assets: Receivables, unbilled Receivables, net $ 70,591 $ 64,882 Contract Liabilities: Deferred revenue Accrued liabilities $ 15,716 $ 18,365 |
Goodwill and Other Intangibles
Goodwill and Other Intangibles (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Goodwill and Other Intangibles | |
Changes in the carrying amount of goodwill by segment | Changes in the carrying amount of goodwill for the three months ended March 31, 2024, by segment, were as follows, in thousands: Accumulated Gross Goodwill FX Translation Gross Goodwill Impairment Net Goodwill December 31, 2023 Additions Adjustment March 31, 2024 Losses March 31, 2024 Goodwill, by segment: Installation $ 1,901,160 $ 4,916 $ - $ 1,906,076 $ (762,021) $ 1,144,055 Specialty Distribution 903,429 6,261 (1,426) 908,264 - 908,264 Total goodwill $ 2,804,589 $ 11,177 $ (1,426) $ 2,814,340 $ (762,021) $ 2,052,319 |
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, 2024 December 31, 2023 Gross definite-lived intangible assets $ 832,327 $ 827,793 Accumulated amortization (253,992) (236,735) Other intangible assets, net $ 578,335 $ 591,058 |
Schedule of amortization expense | As of March 31, 2024 December 31, 2023 Gross definite-lived intangible assets $ 832,327 $ 827,793 Accumulated amortization (253,992) (236,735) Other intangible assets, net $ 578,335 $ 591,058 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
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, 2024 December 31, 2023 3.625% Senior Notes due 2029 $ 400,000 $ 400,000 4.125% Senior Notes due 2032 500,000 500,000 Term loan due 2026 521,250 532,500 Equipment notes 1,230 2,039 Unamortized debt issuance costs (13,752) (14,472) Total debt, net of unamortized debt issuance costs 1,408,728 1,420,067 Less: current portion of long-term debt 46,230 47,039 Total long-term debt $ 1,362,498 $ 1,373,028 |
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, 2024, in thousands: 2024 2025 2026 2027 2028 Thereafter Total 3.625% Senior Notes $ - $ - $ - $ - $ - $ 400,000 $ 400,000 4.125% Senior Notes - - - - - 500,000 500,000 Term loan 33,750 48,750 438,750 - - - 521,250 Equipment notes 1,230 - - - - - 1,230 Total $ 34,980 $ 48,750 $ 438,750 $ - $ - $ 900,000 $ 1,422,480 |
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 $ 600,000 Revolving facility (a) $ 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 as of March 31, 2024 6.43 % Scheduled maturity date 10/7/2026 (a) 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, 2024 December 31, 2023 Revolving facility $ 500,000 $ 500,000 Less: standby letters of credit (63,770) (63,770) Availability under revolving facility $ 436,230 $ 436,230 |
Schedule of the key financial covenants | As of March 31, 2024 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, 2024 | |
Fair Value Measurements | |
Schedule of fair value of liabilities | As of March 31, 2024 Fair Value Gross Carrying Value 3.625% Senior Notes $ 364,940 $ 400,000 4.125% Senior Notes $ 445,000 $ 500,000 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
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, 2024 2023 2024 2023 Net Sales Operating Profit (b) Operations by segment (a): Installation $ 798,743 $ 767,090 $ 156,757 $ 146,897 Specialty Distribution 545,794 558,375 77,579 73,333 Intercompany eliminations (65,820) (60,227) (10,761) (9,971) Total $ 1,278,717 $ 1,265,238 223,575 210,259 General corporate expense, net (c) (9,067) (10,828) Operating profit, as reported 214,508 199,431 Other expense, net (7,513) (16,116) Income before income taxes $ 206,995 $ 183,315 (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, 2024 | |
Net Income Per Share | |
Schedule of basic and diluted income per share | Three Months Ended March 31, 2024 2023 Net income (in thousands) $ 152,381 $ 135,870 Weighted average number of common shares outstanding - basic 31,641,454 31,550,658 Dilutive effect of common stock equivalents: RSAs with service-based conditions 41,832 22,643 RSAs with market-based conditions 50,955 24,861 RSAs with performance-based conditions 14,429 29,031 Stock options 95,148 86,046 Weighted average number of common shares outstanding - diluted 31,843,818 31,713,239 Basic net income per common share $ 4.82 $ 4.31 Diluted net income per common share $ 4.79 $ 4.28 |
Summary of shares excluded from the calculation of diluted income per share because their effect would have been anti-dilutive | Three Months Ended March 31, 2024 2023 Anti-dilutive common stock equivalents: RSAs with service-based conditions 14 11,163 RSAs with market-based conditions - 8,933 RSAs with performance-based conditions - - Stock options - 22,280 Total anti-dilutive common stock equivalents 14 42,376 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
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, 2024 2023 Share-based compensation expense $ 5,127 $ 3,135 Income tax expense $ (2,009) $ (45) |
Schedule of share-based compensation activity | The following table presents a summary of our share-based compensation activity for the three months ended March 31, 2024, 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, 2023 195.5 $ 223.49 128.7 $ 36.65 $ 98.58 $ 35,462.8 Granted 42.6 $ 419.56 — $ — $ — — Converted/Exercised (48.2) $ 230.09 (5.8) $ 70.25 $ 177.53 $ 1,355.3 Forfeited/Expired (2.2) $ 276.34 — $ — $ — — Balance March 31, 2024 187.7 $ 265.84 122.9 $ 35.08 $ 94.88 $ 42,498.1 Exercisable March 31, 2024 (a) 122.9 $ 35.08 $ 94.88 $ 42,498.1 (a) The weighted average remaining contractual term for vested stock options is approximately 5.1 years. |
Schedule of unrecognized share-based compensation expense relating to unvested awards | We have unrecognized share-based compensation expense related to unvested awards as shown in the following table, dollars in thousands: As of March 31, 2024 Unrecognized Compensation Expense on Unvested Awards Weighted Average Remaining Compensation Expense Period RSAs $ 31,455 1.2 Stock options — — Total unrecognized compensation expense related to unvested awards $ 31,455 |
Schedule of key inputs used to estimate the fair value of awards | 2024 2023 2022 Measurement period (years) 2.86 2.86 2.87 Risk free interest rate 4.36 % 4.42 % 1.76 % Dividend yield 0.00 % 0.00 % 0.00 % Estimated fair value of market-based RSAs at grant date $ 503.68 $ 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 | 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 15, 2022 $ 2,986 $ - $ 747 $ 2,986 $ 5,972 February 21, 2023 $ 4,054 $ - $ 1,014 $ 4,054 $ 8,108 February 21, 2024 $ 4,846 $ - $ 1,212 $ 4,846 $ 9,692 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Accrued Liabilities. | |
Schedule of components of accrued liabilities | The following table sets forth the components of accrued liabilities, in thousands: As of March 31, 2024 December 31, 2023 Accrued liabilities: Salaries, wages, and bonus/commissions $ 53,145 $ 67,471 Income tax payable 46,554 389 Insurance liabilities 31,197 29,920 Sales and property taxes 15,986 17,002 Deferred revenue 15,716 18,365 Customer rebates 12,177 17,326 Interest payable on long-term debt 3,357 12,139 Other 23,270 24,605 Total accrued liabilities $ 201,402 $ 187,217 |
Other Commitments and Conting_2
Other Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
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, 2024 December 31, 2023 Outstanding bonds: Performance bonds $ 141,380 $ 145,982 Licensing, insurance, and other bonds 27,979 27,415 Total bonds $ 169,359 $ 173,397 |
Basis of Presentation (Details)
Basis of Presentation (Details) | 3 Months Ended |
Mar. 31, 2024 segment | |
Basis of Presentation | |
Number of reportable segments | 2 |
Revenue Recognition - Disaggreg
Revenue Recognition - Disaggregation (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Revenue Recognition | ||
Net sales | $ 1,278,717 | $ 1,265,238 |
Insulation and accessories | ||
Revenue Recognition | ||
Net sales | 1,076,810 | 1,051,596 |
Glass and windows | ||
Revenue Recognition | ||
Net sales | 58,117 | 63,442 |
Gutters | ||
Revenue Recognition | ||
Net sales | 60,974 | 60,955 |
All other | ||
Revenue Recognition | ||
Net sales | 82,816 | 89,245 |
Residential | ||
Revenue Recognition | ||
Net sales | 834,843 | 818,639 |
Commercial and Industrial | ||
Revenue Recognition | ||
Net sales | 443,874 | 446,599 |
Operating Segment | Installation | ||
Revenue Recognition | ||
Net sales | 798,743 | 767,090 |
Operating Segment | Installation | Insulation and accessories | ||
Revenue Recognition | ||
Net sales | 643,650 | 600,767 |
Operating Segment | Installation | Glass and windows | ||
Revenue Recognition | ||
Net sales | 58,117 | 63,442 |
Operating Segment | Installation | Gutters | ||
Revenue Recognition | ||
Net sales | 27,967 | 28,278 |
Operating Segment | Installation | All other | ||
Revenue Recognition | ||
Net sales | 69,009 | 74,603 |
Operating Segment | Installation | Residential | ||
Revenue Recognition | ||
Net sales | 674,436 | 645,703 |
Operating Segment | Installation | Commercial and Industrial | ||
Revenue Recognition | ||
Net sales | 124,307 | 121,387 |
Operating Segment | Specialty Distribution | ||
Revenue Recognition | ||
Net sales | 545,794 | 558,375 |
Operating Segment | Specialty Distribution | Insulation and accessories | ||
Revenue Recognition | ||
Net sales | 490,669 | 502,802 |
Operating Segment | Specialty Distribution | Gutters | ||
Revenue Recognition | ||
Net sales | 40,316 | 39,842 |
Operating Segment | Specialty Distribution | All other | ||
Revenue Recognition | ||
Net sales | 14,809 | 15,731 |
Operating Segment | Specialty Distribution | Residential | ||
Revenue Recognition | ||
Net sales | 216,397 | 224,326 |
Operating Segment | Specialty Distribution | Commercial and Industrial | ||
Revenue Recognition | ||
Net sales | 329,397 | 334,049 |
Eliminations | ||
Revenue Recognition | ||
Net sales | (65,820) | (60,227) |
Eliminations | Insulation and accessories | ||
Revenue Recognition | ||
Net sales | (57,509) | (51,973) |
Eliminations | Gutters | ||
Revenue Recognition | ||
Net sales | (7,309) | (7,165) |
Eliminations | All other | ||
Revenue Recognition | ||
Net sales | (1,002) | (1,089) |
Eliminations | Residential | ||
Revenue Recognition | ||
Net sales | (55,990) | (51,390) |
Eliminations | Commercial and Industrial | ||
Revenue Recognition | ||
Net sales | $ (9,830) | $ (8,837) |
Revenue Recognition - Other (De
Revenue Recognition - Other (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Dec. 31, 2023 | |
Contract Liabilities | ||
Deferred revenue | $ 15,716 | $ 18,365 |
Uncompleted Performance Obligations | ||
Amount remaining on uncompleted performance obligations | $ 392,400 | |
Expected timing of satisfaction of performance obligations | over the next 18 months | |
Receivables, net | ||
Contract Assets | ||
Receivables, unbilled | $ 70,591 | 64,882 |
Uncompleted Performance Obligations | ||
Retained receivables | 82,200 | 81,900 |
Accrued liabilities | ||
Contract Liabilities | ||
Deferred revenue | $ 15,716 | $ 18,365 |
Goodwill and Other Intangible_2
Goodwill and Other Intangibles - Goodwill (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2024 USD ($) item | Dec. 31, 2022 USD ($) | Dec. 31, 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 | $ 2,804,589 | ||
Additions | 11,177 | ||
Fx Translation Adjustment | (1,426) | ||
Gross Goodwill, at end of period | 2,814,340 | ||
Accumulated Impairment Losses | (762,021) | ||
Net Goodwill | 2,052,319 | $ 2,042,568 | |
Installation | |||
Changes in the carrying amount of goodwill | |||
Gross Goodwill, at beginning of period | 1,901,160 | ||
Additions | 4,916 | ||
Gross Goodwill, at end of period | 1,906,076 | ||
Accumulated Impairment Losses | (762,021) | ||
Net Goodwill | 1,144,055 | ||
Specialty Distribution | |||
Changes in the carrying amount of goodwill | |||
Gross Goodwill, at beginning of period | 903,429 | ||
Additions | 6,261 | ||
Fx Translation Adjustment | (1,426) | ||
Gross Goodwill, at end of period | 908,264 | ||
Net Goodwill | $ 908,264 |
Goodwill and Other Intangible_3
Goodwill and Other Intangibles - Other intangible assets (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Other intangible assets | |||
Gross Definite-lived intangible assets | $ 832,327 | $ 827,793 | |
Accumulated Amortization | (253,992) | (236,735) | |
Other intangible asset, net | 578,335 | $ 591,058 | |
Amortization expense | $ 17,686 | $ 16,896 |
Long-Term Debt - Reconciliation
Long-Term Debt - Reconciliation (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Long-Term Debt | ||
Long-term debt | $ 1,422,480 | |
Unamortized debt issuance costs | (13,752) | $ (14,472) |
Total debt, net of unamortized debt issuance costs | 1,408,728 | 1,420,067 |
Less: current portion of long-term debt | 46,230 | 47,039 |
Total long-term debt | $ 1,362,498 | $ 1,373,028 |
3.625% Senior Notes | ||
Long-Term Debt | ||
Interest rate (as a percent) | 3.625% | 3.625% |
Long-term debt | $ 400,000 | $ 400,000 |
4.125% Senior Notes | ||
Long-Term Debt | ||
Interest rate (as a percent) | 4.125% | 4.125% |
Long-term debt | $ 500,000 | $ 500,000 |
Term Loan Facility | ||
Long-Term Debt | ||
Long-term debt | 521,250 | 532,500 |
Equipment Notes | ||
Long-Term Debt | ||
Long-term debt | 1,230 | $ 2,039 |
Total debt, net of unamortized debt issuance costs | $ 1,200 |
Long-Term Debt - Schedule of de
Long-Term Debt - Schedule of debt maturity (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Schedule of Debt Maturity by Years: | ||
2024 | $ 34,980 | |
2025 | 48,750 | |
2026 | 438,750 | |
Thereafter | 900,000 | |
Total | 1,422,480 | |
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: | ||
2024 | 33,750 | |
2025 | 48,750 | |
2026 | 438,750 | |
Total | 521,250 | 532,500 |
Equipment Notes | ||
Schedule of Debt Maturity by Years: | ||
2024 | 1,230 | |
Total | $ 1,230 | $ 2,039 |
Long-Term Debt - Key Terms of C
Long-Term Debt - Key Terms of Credit Agreement (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2024 | Dec. 31, 2023 | Jul. 26, 2023 | |
Revolving Facility | |||
Long-Term Debt | |||
Availability | $ 500,000 | $ 500,000 | |
Credit Agreement | |||
Long-Term Debt | |||
Interest rate | 6.43% | ||
Scheduled maturity date | Oct. 07, 2026 | ||
Credit Agreement | Base Rate Borrowings | Federal Funds Rate | |||
Long-Term Debt | |||
Basis spread | 0.50% | ||
Credit Agreement | Base Rate Borrowings | SOFR | |||
Long-Term Debt | |||
Maturity of the reference rate | 1 month | ||
Credit Agreement | SOFR Rate Borrowings | |||
Long-Term Debt | |||
Interest rate floor (as a percent) | 0% | ||
Credit Agreement | Term Loan Facility | |||
Long-Term Debt | |||
Availability | $ 600,000 | ||
Credit Agreement | Term Facility One | Base Rate Borrowings | Minimum | |||
Long-Term Debt | |||
Applicable margin based on total leverage ratio | 0% | ||
Credit Agreement | Term Facility One | Base Rate Borrowings | Maximum | |||
Long-Term Debt | |||
Applicable margin based on total leverage ratio | 1.50% | ||
Credit Agreement | Term Facility One | Base Rate Borrowings | SOFR | |||
Long-Term Debt | |||
Basis spread | 1% | ||
Credit Agreement | Term Facility One | SOFR Rate Borrowings | Minimum | |||
Long-Term Debt | |||
Applicable margin based on total leverage ratio | 1% | ||
Credit Agreement | Term Facility One | SOFR Rate Borrowings | Maximum | |||
Long-Term Debt | |||
Applicable margin based on total leverage ratio | 2.50% | ||
Credit Agreement | Term Facility Two | |||
Long-Term Debt | |||
Availability | $ 550,000 | ||
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 |
Long-Term Debt - Revolving Faci
Long-Term Debt - Revolving Facility (Details) - Revolving Facility - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Dec. 31, 2023 | |
Long-Term Debt | ||
Revolving Facility | $ 500,000 | $ 500,000 |
Less: standby letters of credit | (63,770) | (63,770) |
Availability under revolving facility | $ 436,230 | $ 436,230 |
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, 2024 | Dec. 31, 2023 | |
Long-Term Debt | ||
Amount outstanding | $ 1,408,728 | $ 1,420,067 |
Equipment Notes | ||
Long-Term Debt | ||
Amount outstanding | $ 1,200 | |
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% | |
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, 2024 | |
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, 2024 USD ($) |
Fair Value on Non-Recurring Basis | |
Amount outstanding | $ 1,422,480 |
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 | $ 364,940 |
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 | $ 445,000 |
Segment Information (Details)
Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Segment information | |||
Net sales | $ 1,278,717 | $ 1,265,238 | |
Operating profit as, reported | 214,508 | 199,431 | |
Other expense, net | (7,513) | (16,116) | |
Income before income taxes | 206,995 | 183,315 | |
Total Assets | 5,310,452 | $ 5,162,851 | |
Operating Segment | |||
Segment information | |||
Operating profit as, reported | 223,575 | 210,259 | |
Operating Segment | Installation | |||
Segment information | |||
Net sales | 798,743 | 767,090 | |
Operating profit as, reported | 156,757 | 146,897 | |
Operating Segment | Specialty Distribution | |||
Segment information | |||
Net sales | 545,794 | 558,375 | |
Operating profit as, reported | 77,579 | 73,333 | |
Eliminations | |||
Segment information | |||
Net sales | (65,820) | (60,227) | |
Intercompany Eliminations | |||
Segment information | |||
Net sales | (65,820) | (60,227) | |
Operating profit as, reported | (10,761) | (9,971) | |
Corporate | |||
Segment information | |||
General corporate expense, net | $ (9,067) | $ (10,828) |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Income Taxes | ||
Effective tax rate (as a percent) | 26.40% | 25.90% |
Tax expense related to share-based compensation | $ 2,009 | $ 45 |
Net Income Per Share - Calculat
Net Income Per Share - Calculation (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Net income | $ 152,381 | $ 135,870 |
Weighted average number of common shares outstanding - basic | 31,641,454 | 31,550,658 |
Dilutive effect of common stock equivalents: | ||
Stock options | 95,148 | 86,046 |
Weighted average number of common shares outstanding - diluted | 31,843,818 | 31,713,239 |
Basic net income per common share | $ 4.82 | $ 4.31 |
Diluted net income per common share | $ 4.79 | $ 4.28 |
Service-based conditions | ||
Dilutive effect of common stock equivalents: | ||
Restricted stock awards | 41,832 | 22,643 |
Market-based conditions | ||
Dilutive effect of common stock equivalents: | ||
Restricted stock awards | 50,955 | 24,861 |
Performance-based conditions | ||
Dilutive effect of common stock equivalents: | ||
Restricted stock awards | 14,429 | 29,031 |
Net Income Per Share - Anti-dil
Net Income Per Share - Anti-dilutive common stock equivalents (Details) - shares | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Anti-dilutive common stock equivalents | ||
Total anti-dilutive common stock equivalents | 14 | 42,376 |
Restricted Stock Awards | Service-based conditions | ||
Anti-dilutive common stock equivalents | ||
Total anti-dilutive common stock equivalents | 14 | 11,163 |
Restricted Stock Awards | Market-based conditions | ||
Anti-dilutive common stock equivalents | ||
Total anti-dilutive common stock equivalents | 8,933 | |
Employee Stock Option | ||
Anti-dilutive common stock equivalents | ||
Total anti-dilutive common stock equivalents | 22,280 |
Share-Based Compensation - Expe
Share-Based Compensation - Expense (Details) - USD ($) $ in Thousands, shares in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Share-Based Compensation | ||
Share-based compensation expense | $ 5,127 | $ 3,135 |
Income tax expense | $ (2,009) | $ (45) |
2015 Plan | ||
Share-Based Compensation | ||
Number of shares available | 1.7 | |
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, 2024 | Feb. 21, 2023 | Feb. 15, 2022 | Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2023 | |
Stock Options, Number of Shares | |||||||
Converted/Exercised (in shares) | (5,757) | (28,840) | |||||
Stock options, additional disclosures | |||||||
Weighted average remaining contractual term for vested stock options | 5 years 1 month 6 days | ||||||
Unrecognized share-based compensation expense | |||||||
Total unrecognized compensation expense related to unvested awards | $ 31,455,000 | ||||||
Restricted Stock Awards | |||||||
Restricted Stock Awards, Number of Shares | |||||||
Balance at beginning of period (in shares) | 195,500 | ||||||
Granted (in shares) | 42,600 | ||||||
Converted/Exercised (in shares) | (48,200) | ||||||
Forfeited/Expired (in shares) | (2,200) | ||||||
Balance at end of period (in shares) | 187,700 | ||||||
Restricted Stock Awards, Weighted Average Grant Date Fair Value Per Share | |||||||
Balance at beginning of period (in dollars per share) | $ 223.49 | ||||||
Granted (in dollars per share) | 419.56 | ||||||
Converted/Exercised (in dollars per share) | 230.09 | ||||||
Forfeited/Expired (in dollars per share) | 276.34 | ||||||
Balance at end of period (in dollars per share) | $ 265.84 | ||||||
Unrecognized share-based compensation expense | |||||||
RSAs, Unrecognized Compensation Expense on Unvested Awards | $ 31,455,000 | ||||||
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 9 days | 2 years 10 months 13 days | ||||
Risk free interest rate (as a percent) | 4.36% | 4.42% | 1.76% | ||||
Dividend yield (as a percent) | 0% | 0% | 0% | ||||
Estimated fair value of market-based RSAs at grant date (in dollars per share) | $ 503.68 | $ 270.64 | $ 298.20 | ||||
Restricted Stock Awards | Performance-based conditions | |||||||
Restricted stock awards, additional disclosures | |||||||
Grant date fair value | $ 4,846,000 | $ 4,054,000 | $ 2,986,000 | ||||
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 | $ 1,212,000 | $ 1,014,000 | $ 747,000 | ||||
Restricted Stock Awards | Performance-based conditions | Payout Range-100% | |||||||
Restricted stock awards, additional disclosures | |||||||
Payout range (as a percent) | 100% | 100% | 100% | ||||
Related expenses | $ 4,846,000 | $ 4,054,000 | $ 2,986,000 | ||||
Restricted Stock Awards | Performance-based conditions | Payout Range-200% | |||||||
Restricted stock awards, additional disclosures | |||||||
Payout range (as a percent) | 200% | 200% | 200% | ||||
Related expenses | $ 9,692,000 | $ 8,108,000 | $ 5,972,000 | ||||
RSAs granted February 16, 2021 | Performance-based conditions | |||||||
Restricted stock awards, additional disclosures | |||||||
Cumulative period of achievement | 3 years | 3 years | |||||
Cumulative achievement percentage | 200% | ||||||
Total compensation expense recognized over the performance period, net of forfeitures | $ 4,400,000 | ||||||
Employee Stock Option | |||||||
Stock Options, Number of Shares | |||||||
Balance at beginning of period (in shares) | 128,700 | ||||||
Converted/Exercised (in shares) | (5,800) | ||||||
Balance at end of period (in shares) | 122,900 | ||||||
Stock Options, Weighted Average Grant Date Fair Value Per Share | |||||||
Balance at beginning of period (in dollars per share) | $ 36.65 | ||||||
Converted/Exercised (in dollars per share) | 70.25 | ||||||
Balance at end of period (in dollars per share) | 35.08 | ||||||
Stock Options, Weighted Average Exercise Price Per Share | |||||||
Balance at beginning of period (in dollars per share) | 98.58 | ||||||
Converted/Exercised (in dollars per share) | 177.53 | ||||||
Balance at end of period (in dollars per share) | $ 94.88 | ||||||
Stock options, additional disclosures | |||||||
Aggregate intrinsic value | $ 42,498,100 | $ 35,462,800 | |||||
Converted/Exercised aggregate intrinsic value | $ 1,355,300 | ||||||
Exercisable, Number of shares | 122,900 | ||||||
Exercisable, Weighted Average Grant Date Fair Value Per Share | $ 35.08 | ||||||
Exercisable Weighted Average Exercise Price Per Share | $ 94.88 | ||||||
Exercisable, Aggregate Intrinsic Value | $ 42,498,100 |
Business Combinations - Summary
Business Combinations - Summary (Details) - USD ($) $ in Thousands | 3 Months Ended | ||||
Mar. 01, 2024 | Feb. 15, 2024 | Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Business Combinations | |||||
Acquisition related costs | $ 500 | $ 1,700 | |||
Summary of businesses acquired: | |||||
Goodwill expected to be deducted for income tax purposes | 11,200 | 23,100 | |||
Estimated fair values | |||||
Goodwill | $ 2,052,319 | $ 2,042,568 | |||
Brabble | |||||
Business Combinations | |||||
Purchase price | $ 5,400 | ||||
Goodwill recognized | $ 3,000 | ||||
Morris Black | |||||
Business Combinations | |||||
Purchase price | $ 3,600 | ||||
Goodwill recognized | 2,000 | ||||
PCI | |||||
Business Combinations | |||||
Purchase price | 13,300 | ||||
Goodwill recognized | $ 6,300 | ||||
SRI Holdings | |||||
Business Combinations | |||||
Purchase price | 45,300 | ||||
Goodwill recognized | $ 23,100 |
Business Combinations - Intangi
Business Combinations - Intangibles (Details) - 2024 Acquisitions - Customer relationships $ in Millions | 3 Months Ended |
Mar. 31, 2024 USD ($) | |
Estimates of acquired intangible assets | |
Estimated Fair Value | $ 6 |
Weighted Average Estimated Useful Life (Years) | 12 years |
Accrued Liabilities (Details)
Accrued Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Accrued Liabilities. | ||
Salaries, wages, and bonus/commissions | $ 53,145 | $ 67,471 |
Income taxes payable | 46,554 | 389 |
Insurance liabilities | 31,197 | 29,920 |
Customer rebates | 12,177 | 17,326 |
Deferred revenue | 15,716 | 18,365 |
Sales and property taxes | 15,986 | 17,002 |
Interest payable on long-term debt | 3,357 | 12,139 |
Other | 23,270 | 24,605 |
Total accrued liabilities | $ 201,402 | $ 187,217 |
Other Commitments and Conting_3
Other Commitments and Contingencies (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Outstanding Bonds | ||
Performance bonds | $ 141,380 | $ 145,982 |
Licensing, insurance, and other bonds | 27,979 | 27,415 |
Total bonds | $ 169,359 | $ 173,397 |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent Event - USD ($) $ in Millions | May 03, 2024 | Apr. 22, 2024 |
SPI | ||
Subsequent Events | ||
Termination fee | $ 23 | |
Insulation Works Inc. | ||
Subsequent Events | ||
Expected purchase price | $ 25.2 | |
2024 Share Repurchase Program | ||
Subsequent Events | ||
Share repurchase program, authorized amount | $ 1,000 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Pay vs Performance Disclosure | ||
Net Income (Loss) | $ 152,381 | $ 135,870 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Mar. 31, 2024 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |