Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2019 | Nov. 01, 2019 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Forterra, Inc. | |
Entity Central Index Key | 0001678463 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Current Reporting Status | Yes | |
Entity Common Stock, Shares Outstanding | 64,562,085 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Income Statement [Abstract] | ||||
Net sales | $ 464,526 | $ 434,510 | $ 1,166,603 | $ 1,140,557 |
Cost of goods sold | 362,362 | 357,374 | 936,820 | 953,743 |
Gross profit | 102,164 | 77,136 | 229,783 | 186,814 |
Selling, general & administrative expenses | (55,234) | (48,492) | (165,265) | (151,617) |
Impairment and exit charges | (510) | (2,170) | (1,323) | (3,891) |
Other operating income, net | 815 | 1,538 | 1,018 | 6,864 |
Operating expenses | (54,929) | (49,124) | (165,570) | (148,644) |
Income from operations | 47,235 | 28,012 | 64,213 | 38,170 |
Other income (expense) | ||||
Interest expense | (23,272) | (21,940) | (73,720) | (52,993) |
Gain on extinguishment of debt | 374 | 0 | 374 | 0 |
Earnings from equity method investee | 3,990 | 2,224 | 8,959 | 7,745 |
Other income, net | 0 | 0 | 0 | 6,016 |
Income (loss) before income taxes | 28,327 | 8,296 | (174) | (1,062) |
Income tax (expense) benefit | (5,897) | (2,793) | 519 | (6,351) |
Net income (loss) | $ 22,430 | $ 5,503 | $ 345 | $ (7,413) |
Earnings (loss) per share: | ||||
Basic (in dollars per share) | $ 0.35 | $ 0.09 | $ 0.01 | $ (0.12) |
Diluted (in dollars per share) | $ 0.34 | $ 0.09 | $ 0.01 | $ (0.12) |
Weighted average common shares outstanding: | ||||
Basic (in shares) | 64,210 | 63,919 | 64,119 | 63,883 |
Diluted (in shares) | 64,998 | 64,269 | 64,528 | 63,883 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ 22,430 | $ 5,503 | $ 345 | $ (7,413) |
Unrealized gain on derivative activities, net of tax | 0 | 0 | ||
Unrealized gain on derivative activities, net of tax | 0 | 970 | ||
Change in other postretirement benefit plans, net of tax | 0 | 0 | 373 | 0 |
Foreign currency translation adjustment | (710) | 1,486 | 2,118 | (1,640) |
Comprehensive income (loss) | $ 21,720 | $ 6,989 | $ 2,836 | $ (8,083) |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Current assets | ||
Cash and cash equivalents | $ 43,852 | $ 35,793 |
Receivables, net | 286,345 | 198,468 |
Inventories | 256,645 | 285,030 |
Other current assets | 19,603 | 24,798 |
Total current assets | 606,445 | 544,089 |
Non-current assets | ||
Property, plant and equipment, net | 477,273 | 492,167 |
Operating lease right-of-use assets | 62,252 | |
Goodwill | 508,588 | 508,193 |
Intangible assets, net | 154,558 | 183,789 |
Investment in equity method investee | 53,065 | 50,607 |
Other long-term assets | 3,965 | 14,407 |
Total assets | 1,866,146 | 1,793,252 |
Current liabilities | ||
Trade payables | 138,247 | 114,708 |
Accrued liabilities | 85,422 | 70,236 |
Deferred revenue | 9,221 | 9,138 |
Current portion of long-term debt | 12,510 | 12,510 |
Current portion of tax receivable agreement | 15,457 | 15,457 |
Total current liabilities | 260,857 | 222,049 |
Non-current liabilities | ||
Long-term debt | 1,156,023 | 1,176,095 |
Long-term finance lease liabilities | 136,556 | |
Long-term finance lease liabilities | 134,948 | |
Long-term operating lease liabilities | 55,669 | |
Deferred tax liabilities | 37,324 | 46,615 |
Deferred gain on sale-leaseback | 0 | 9,338 |
Other long-term liabilities | 22,395 | 22,667 |
Long-term tax receivable agreement | 73,318 | 73,318 |
Total liabilities | 1,742,142 | 1,685,030 |
Commitments and Contingencies (Note 14) | ||
Equity | ||
Common stock, $0.001 par value, 190,000 shares authorized; 64,540 and 64,206 shares issued and outstanding | 18 | 18 |
Additional paid-in-capital | 240,920 | 234,931 |
Accumulated other comprehensive loss | (8,249) | (10,740) |
Retained deficit | (108,685) | (115,987) |
Total shareholder's equity | 124,004 | 108,222 |
Total liabilities and shareholders' equity | $ 1,866,146 | $ 1,793,252 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Common shares, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common shares, authorized (in shares) | 190,000,000 | 190,000,000 |
Common shares, issued (in shares) | 64,540,000 | 64,206,000 |
Common shares, outstanding (in shares) | 64,540,000 | 64,206,000 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Shareholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in-Capital | Accumulated Other Comprehensive Income (Loss) | Retained Deficit |
Beginning Balance (in shares) at Dec. 31, 2017 | 64,230,888 | ||||
Beginning Balance at Dec. 31, 2017 | $ 132,491 | $ 18 | $ 230,023 | $ (5,098) | $ (92,452) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Share-based compensation expense | 1,154 | 1,154 | |||
Stock-based plan activity (in shares) | (3,663) | ||||
Stock-based plan activity | (57) | (57) | |||
Comprehensive income (loss): | |||||
Net income (loss) | (19,910) | (19,910) | |||
Gain on derivative transactions, net of tax | 970 | 970 | |||
Foreign currency translation adjustment, and other | (1,557) | (1,557) | |||
Reclassification due to the adoption of ASU 2018-02 | 0 | (830) | 830 | ||
Ending Balance (in shares) at Mar. 31, 2018 | 64,227,225 | ||||
Ending Balance at Mar. 31, 2018 | 113,091 | $ 18 | 231,120 | (6,515) | (111,532) |
Beginning Balance (in shares) at Dec. 31, 2017 | 64,230,888 | ||||
Beginning Balance at Dec. 31, 2017 | 132,491 | $ 18 | 230,023 | (5,098) | (92,452) |
Comprehensive income (loss): | |||||
Net income (loss) | (7,413) | ||||
Change in other postretirement benefit plans, net of tax | 0 | ||||
Ending Balance (in shares) at Sep. 30, 2018 | 64,202,131 | ||||
Ending Balance at Sep. 30, 2018 | 128,873 | $ 18 | 234,487 | (6,598) | (99,034) |
Beginning Balance (in shares) at Mar. 31, 2018 | 64,227,225 | ||||
Beginning Balance at Mar. 31, 2018 | 113,091 | $ 18 | 231,120 | (6,515) | (111,532) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Share-based compensation expense | 1,984 | 1,984 | |||
Stock-based plan activity (in shares) | 868 | ||||
Stock-based plan activity | (39) | (39) | |||
Comprehensive income (loss): | |||||
Net income (loss) | 6,994 | 6,994 | |||
Foreign currency translation adjustment, and other | (1,567) | (1,569) | 2 | ||
Ending Balance (in shares) at Jun. 30, 2018 | 64,228,093 | ||||
Ending Balance at Jun. 30, 2018 | 120,463 | $ 18 | 233,065 | (8,084) | (104,536) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Share-based compensation expense | 1,450 | 1,450 | |||
Stock-based plan activity (in shares) | (25,962) | ||||
Stock-based plan activity | (28) | (28) | |||
Comprehensive income (loss): | |||||
Net income (loss) | 5,503 | 5,503 | |||
Change in other postretirement benefit plans, net of tax | 0 | ||||
Foreign currency translation adjustment, and other | 1,485 | 1,486 | (1) | ||
Ending Balance (in shares) at Sep. 30, 2018 | 64,202,131 | ||||
Ending Balance at Sep. 30, 2018 | $ 128,873 | $ 18 | 234,487 | (6,598) | (99,034) |
Beginning Balance (in shares) at Dec. 31, 2018 | 64,206,000 | 64,205,604 | |||
Beginning Balance at Dec. 31, 2018 | $ 108,222 | $ 18 | 234,931 | (10,740) | (115,987) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Share-based compensation expense | 1,529 | 1,529 | |||
Stock-based plan activity (in shares) | 57,106 | ||||
Stock-based plan activity | (26) | (26) | |||
Comprehensive income (loss): | |||||
Net income (loss) | (25,039) | (25,039) | |||
Change in other postretirement benefit plans, net of tax | 373 | 373 | |||
Foreign currency translation adjustment, and other | 1,508 | 1,508 | |||
Ending Balance (in shares) at Mar. 31, 2019 | 64,262,710 | ||||
Ending Balance at Mar. 31, 2019 | $ 93,524 | $ 18 | 236,434 | (8,859) | (134,069) |
Beginning Balance (in shares) at Dec. 31, 2018 | 64,206,000 | 64,205,604 | |||
Beginning Balance at Dec. 31, 2018 | $ 108,222 | $ 18 | 234,931 | (10,740) | (115,987) |
Comprehensive income (loss): | |||||
Net income (loss) | 345 | ||||
Change in other postretirement benefit plans, net of tax | $ 373 | ||||
Ending Balance (in shares) at Sep. 30, 2019 | 64,540,000 | 64,539,590 | |||
Ending Balance at Sep. 30, 2019 | $ 124,004 | $ 18 | 240,920 | (8,249) | (108,685) |
Beginning Balance (in shares) at Mar. 31, 2019 | 64,262,710 | ||||
Beginning Balance at Mar. 31, 2019 | 93,524 | $ 18 | 236,434 | (8,859) | (134,069) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Share-based compensation expense | 1,132 | 1,132 | |||
Stock-based plan activity (in shares) | 35,447 | ||||
Stock-based plan activity | (88) | (88) | |||
Comprehensive income (loss): | |||||
Net income (loss) | 2,954 | 2,954 | |||
Foreign currency translation adjustment, and other | 1,320 | 1,320 | |||
Ending Balance (in shares) at Jun. 30, 2019 | 64,298,157 | ||||
Ending Balance at Jun. 30, 2019 | 98,842 | $ 18 | 237,478 | (7,539) | (131,115) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Share-based compensation expense | 2,172 | 2,172 | |||
Stock-based plan activity (in shares) | 241,433 | ||||
Stock-based plan activity | 1,270 | 1,270 | |||
Comprehensive income (loss): | |||||
Net income (loss) | 22,430 | 22,430 | |||
Change in other postretirement benefit plans, net of tax | 0 | ||||
Foreign currency translation adjustment, and other | $ (710) | (710) | |||
Ending Balance (in shares) at Sep. 30, 2019 | 64,540,000 | 64,539,590 | |||
Ending Balance at Sep. 30, 2019 | $ 124,004 | $ 18 | $ 240,920 | $ (8,249) | $ (108,685) |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Sep. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||
Net income (loss) | $ 22,430 | $ (25,039) | $ 5,503 | $ (19,910) | $ 345 | $ (7,413) | |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||||||
Depreciation & amortization expense | 72,954 | 79,373 | |||||
(Gain) / loss on business divestiture | 0 | (6,016) | |||||
(Gain) / loss on disposal of property, plant and equipment | 1,551 | (2,447) | |||||
Gain on extinguishment of debt | (374) | 0 | (374) | 0 | |||
Amortization of debt discount and issuance costs | 6,022 | 6,099 | |||||
Stock-based compensation expense | 4,833 | 4,588 | |||||
Impairment charges | 0 | 936 | |||||
Earnings from equity method investee | (3,990) | (2,224) | (8,959) | (7,745) | |||
Distributions from equity method investee | 6,500 | 8,875 | |||||
Unrealized loss / (gain) on derivative instruments, net | 5,892 | (4,291) | |||||
Unrealized foreign currency loss / (gain), net | 35 | (358) | |||||
Provision (recoveries) for doubtful accounts | 511 | (1,905) | |||||
Deferred taxes | (11,672) | (24,787) | |||||
Deferred rent | 0 | 1,022 | |||||
Other non-cash items | (188) | 77 | |||||
Change in assets and liabilities: | |||||||
Receivables, net | (88,138) | (83,720) | |||||
Inventories | 29,109 | (25,019) | |||||
Other current assets | 1,296 | 6,910 | |||||
Accounts payable and accrued liabilities | 37,259 | 25,042 | |||||
Other assets & liabilities | 8,746 | 2,184 | |||||
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | 65,722 | (28,595) | |||||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||||
Purchase of property, plant and equipment, and intangible assets | (44,321) | (31,474) | |||||
Proceeds from business divestiture | 0 | 618 | |||||
Proceeds from sale of fixed assets | 10,580 | 4,874 | |||||
Settlement of net investment hedges | 0 | (4,990) | |||||
Business combinations, net of cash acquired | 0 | (4,500) | |||||
NET CASH USED IN INVESTING ACTIVITIES | (33,741) | (35,472) | |||||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||
Payments on term loans | (25,110) | (9,383) | |||||
Proceeds from revolver | 54,000 | 0 | |||||
Payments on revolver | (54,000) | 0 | |||||
Proceeds from issuance of common stock | 1,282 | 0 | |||||
Other financing activities | (552) | (385) | |||||
NET CASH USED IN FINANCING ACTIVITIES | (24,380) | (9,768) | |||||
Effect of exchange rate changes on cash | 458 | (351) | |||||
Net change in cash and cash equivalents | 8,059 | (74,186) | |||||
Cash and cash equivalents, beginning of period | $ 35,793 | $ 104,534 | 35,793 | 104,534 | $ 104,534 | ||
Cash and cash equivalents, end of period | $ 43,852 | $ 30,348 | 43,852 | 30,348 | $ 35,793 | ||
SUPPLEMENTAL DISCLOSURES: | |||||||
Cash interest paid | 59,138 | 50,217 | |||||
Income taxes paid | 5,054 | 21,508 | |||||
SUPPLEMENTAL NON-CASH INVESTING AND FINANCING DISCLOSURES: | |||||||
Assets and liabilities acquired in non-cash exchange | 0 | 18,140 | |||||
Fair value changes of derivatives recorded in OCI, net of tax | 0 | 970 | |||||
Capital lease obligation resulting from the sale-leaseback exchange transaction | $ 0 | $ (148,962) |
Organization and description of
Organization and description of the business | 9 Months Ended |
Sep. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and description of the business | Organization and description of the business Description of the Business Forterra, Inc. (“Forterra” or the ‘‘Company’’) is involved in the manufacturing, sale and distribution of building products in the United States (“U.S.”) and Eastern Canada. Forterra’s primary products are concrete drainage pipe, precast concrete structures, and water transmission pipe used in drinking and wastewater systems. These products are used in the residential, infrastructure and non-residential sectors of the construction industry. Organization Forterra, a Delaware corporation, was formed on June 21, 2016 to hold the business of Forterra Building Products. The entities comprising the business of Forterra Building Products were indirect wholly-owned subsidiaries of HeidelbergCement A.G. (together with its affiliates, "HC") prior to its acquisition by LSF9 Concrete Holdings Ltd. ("LSF9") on March 13, 2015 (the "Acquisition"), including certain businesses that were divested between March 2015 and October 2016. In October 2016, in a corporate reorganization transaction (the "Reorganization") ownership of the remaining businesses of Forterra Building Products was transferred to Forterra, a wholly-owned subsidiary of Forterra US Holdings, LLC, which is indirectly wholly-owned by an affiliate of Lone Star Fund IX (U.S.),L.P. (along with its affiliates, related parties and associated, but excluding the Company and other companies that it owns as a result of its investment activity, “ Lone Star ” ). On October 25, 2016, Forterra sold 18,420,000 shares of common stock in its initial public offering (the “IPO”). |
Summary of significant accounti
Summary of significant accounting policies | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Summary of significant accounting policies | Summary of significant accounting policies General The Company's condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) and include the accounts and results of operations of the Company and its consolidated subsidiaries. All intercompany transactions have been eliminated in consolidation. The condensed consolidated balance sheets and the condensed consolidated statements of operations, comprehensive income (loss), cash flows and equity for the periods presented herein reflect all adjustments that are of a normal recurring nature and are necessary for a fair statement of the results of the periods shown. Certain information and note disclosures normally included in annual financial statements have been condensed or omitted pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). The results of operations for the periods presented are not necessarily indicative of the results that may be expected for the year ending December 31, 2019. Seasonal changes and other conditions can affect the sales volumes of the Company's products. The financial results for any interim period do not necessarily indicate the expected results for the year. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto for the year ended December 31, 2018 as provided in Forterra, Inc.'s Annual Report on Form 10-K for the year ended December 31, 2018 filed with the SEC on March 12, 2019 (the “2018 10-K”). The Company has continued to follow the accounting policies set forth in those financial statements, except as supplemented and documented below. Certain prior year numbers were reclassified to conform with current year presentation. Such reclassification had no impact on the previously reported results of operations. Use of estimates The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities as of the reporting date, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. These estimates are based on management’s best knowledge of current events and actions that the Company may undertake in the future. The more significant estimates made by management relate to fair value estimates for assets and liabilities acquired in business combinations; estimates for accrued liabilities for environmental cleanup, bodily injury and insurance claims; estimates for commitments and contingencies; and estimates for the realizability of deferred tax assets, the tax receivable agreement obligation, inventory reserves, allowance for doubtful accounts and impairment of goodwill and long-lived assets. Concentration of Credit Risk The Company had an individual customer within its Water Pipe & Products segment that accounted for approximately 14% and 14% of the Company's total net sales for the nine months ended September 30, 2019 and 2018, respectively, and receivables at September 30, 2019 and December 31, 2018 representing 14% and 16% of the Company's total receivables, net, respectively. Leases The Company determines if an arrangement is a lease at inception. Leases with an initial term of less than 12 months are not recorded on the balance sheet. Operating leases are included in operating lease right-of-use (“ROU”) assets, accrued liabilities, and long-term operating lease liabilities in the condensed consolidated balance sheets. Finance leases are included in property, plant and equipment, accrued liabilities, and long-term finance lease liabilities in the condensed consolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term, and lease liabilities represent the Company's obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The Company uses the implicit rate when readily determinable. The lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components, which are generally accounted for separately. For machinery and equipment leases, such as forklifts, the Company accounts for the lease and non-lease components as a single lease component. Recent Accounting Guidance Adopted In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-02, Leases (Topic 842) , which establishes the principles that lessees and lessors shall apply to report information about the amount, timing, and uncertainty of cash flows arising from a lease. Under the new guidance, lessees are required to recognize a right-of-use asset and a lease liability, measured on a discounted basis, at the commencement date for all leases with terms greater than twelve months. Additionally, this guidance will require disclosures to help investors and other financial statement users better understand the amount, timing and uncertainty of cash flows arising from leases, including qualitative and quantitative requirements. The Company adopted Topic 842 during the first quarter of 2019, using the transition approach that permits application of the new standard at the adoption date instead of the earliest comparative period presented in the financial statements. To adopt Topic 842, the Company elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allowed the Company to carry forward its historical assessments of (1) whether the existing contracts contained a lease, (2) the lease classification for existing leases, and (3) initial direct cost for existing leases. In addition to the package of practical expedients, the Company has elected the adoption expedients of (1) the exclusion of leases with terms less than 12 months, and (2) the election not to separate non-lease components from lease components for certain classes of underlying leased assets. To adopt Topic 842, the Company recognized a cumulative catch-up adjustment to the opening balance sheet presented January 1, 2019. The adoption of the standard had a material impact on the Company’s condensed consolidated balance sheet but did not have an impact on its condensed consolidated statements of operations, comprehensive income (loss) or cash flows. As a result of the adoption, the Company has recorded additional lease assets and lease liabilities of approximately $63.9 million and $65.2 million , respectively, as of January 1, 2019. In addition, the Company recognized the carrying value of deferred gains related to certain sale and operating leaseback of land of $9.3 million , net of tax impact of $2.3 million , to beginning retained deficit as of January 1, 2019, in accordance with ASC 842-10-65-1. |
Acquisitions
Acquisitions | 9 Months Ended |
Sep. 30, 2019 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions On March 1, 2019, the Company acquired certain assets of Texas limited liability companies Houston Buckner Precast, LLC, Buckner Precast, LLC, Montgomery 18905 E. Industrial, LLC, and 1763 Old Denton Road, LLC (altogether "Buckner") for consideration of $11.8 million in cash, inclusive of a working capital adjustment. The acquired Buckner assets did not meet the definition of a business and, as such, the transaction was accounted for as an asset acquisition pursuant to the guidance in subsection 805-50 of ASC 805, Business Combinations. The assets will operate as part of the Company’s Drainage Pipe & Products segment. |
Receivables, net
Receivables, net | 9 Months Ended |
Sep. 30, 2019 | |
Receivables [Abstract] | |
Receivables, net | Receivables, net Receivables consist of the following (in thousands) : September 30, December 31, 2019 2018 Trade receivables $ 262,506 $ 188,999 Amounts billed but not yet paid under retainage provisions 2,856 2,065 Other receivables 23,564 9,545 Total receivables 288,926 200,609 Less: Allowance for doubtful accounts (2,581 ) (2,141 ) Receivables, net $ 286,345 $ 198,468 |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consist of the following (in thousands) : September 30, December 31, 2019 2018 Finished goods $ 170,000 $ 193,603 Raw materials 86,025 90,376 Work in process 620 1,051 Total inventories $ 256,645 $ 285,030 |
Investment in equity method inv
Investment in equity method investee | 9 Months Ended |
Sep. 30, 2019 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investment in equity method investee | Investment in equity method investee The Company owns 50% of the Common Unit voting shares of Concrete Pipe & Precast LLC ("CP&P") and consequently, has recorded its investment in the Common Unit voting shares in accordance with ASC 323, Investments – Equity Method and Joint Ventures , under the equity method of accounting. The Company's investment in the joint venture was $53.1 million at September 30, 2019 , which is included within the Drainage Pipe & Products segment. At September 30, 2019 , the difference between the amount at which the Company's investment is carried and the amount of the Company's share of the underlying equity in net assets of CP&P was approximately $13.1 million . The basis difference is primarily attributed to the value of land and equity method goodwill associated with the investment. The following reflects the Company's distribution and earnings in the equity investment (in thousands) : Three months ended Nine months ended September 30, September 30, 2019 2018 2019 2018 Distribution received from CP&P $ (5,000 ) $ (3,875 ) $ (6,500 ) $ (8,875 ) Share of earnings in CP&P 4,008 2,242 9,013 7,799 Amortization of excess fair value of investment (18 ) (18 ) (54 ) (54 ) Selected financial data for CP&P on a 100% basis is as follows ( in thousands ): Three months ended Nine months ended September 30, September 30, 2019 2018 2019 2018 Net sales $ 38,210 $ 31,864 $ 103,812 $ 96,537 Gross profit 12,632 9,042 32,307 28,537 Income from operations 8,021 4,540 18,041 15,235 Net income 7,959 4,479 17,852 15,052 |
Property, plant and equipment,
Property, plant and equipment, net | 9 Months Ended |
Sep. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property, plant and equipment, net | Property, plant and equipment, net Property, plant and equipment, net, consist of the following (in thousands) : September 30, December 31, 2019 2018 Machinery and equipment $ 391,957 $ 373,881 Land, buildings and improvements 237,465 235,819 Other equipment 8,005 6,962 Construction-in-progress 28,668 32,448 Total property, plant and equipment 666,095 649,110 Less: accumulated depreciation (188,822 ) (156,943 ) Property, plant and equipment, net $ 477,273 $ 492,167 Depreciation expense totaled $12.3 million and $37.4 million for the three and nine months ended September 30, 2019 , and $12.9 million and $39.9 million for the three and nine months ended September 30, 2018 , respectively, which is included in cost of goods sold and selling, general and administrative expenses in the condensed consolidated statements of operations. |
Goodwill and other intangible a
Goodwill and other intangible assets, net | 9 Months Ended |
Sep. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and other intangible assets, net | Goodwill and other intangible assets, net The Company has recorded goodwill in connection with its acquisition of businesses. The following table summarizes the changes in goodwill by operating segment for the nine months ended September 30, 2019 ( in thousands ): Drainage Pipe & Products Water Pipe & Products Total Balance at December 31, 2018 $ 189,833 $ 318,360 $ 508,193 Foreign currency and other adjustments 395 — 395 Balance at September 30, 2019 $ 190,228 $ 318,360 $ 508,588 Intangible assets other than goodwill at September 30, 2019 and December 31, 2018 included the following ( in thousands ): Net carrying value as of September 30, 2019 Net carrying value as of December 31, 2018 Customer relationships and contracts $ 109,769 $ 131,473 Trade names 20,850 24,523 Patents 8,581 11,304 Non-compete agreements 8,801 9,574 Developed technology 6,074 — In-Process R&D (1) — 6,354 Other 483 561 Total intangible assets $ 154,558 $ 183,789 (1) Reclassified to developed technology in the first quarter of 2019. Amortization expense totaled $11.9 million and $35.5 million for the three and nine months ended September 30, 2019 , and $13.1 million and $39.4 million for the three and nine months ended September 30, 2018 , respectively, which is included in selling, general and administrative expenses in the condensed consolidated statements of operations. All of the Company's intangible assets are amortizable. |
Fair value measurement
Fair value measurement | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair value measurement | Fair value measurement The Company's financial instruments consist primarily of cash and cash equivalents, trade and other receivables, derivative instruments, accounts payable, long-term debt, operating and finance lease liabilities, accrued liabilities and the tax receivable agreement obligation. The carrying value of the Company's trade receivables, other receivables, trade payables, the asset-based revolver and accrued liabilities approximates fair value due to their short-term maturity or other terms related to these financial instruments. The Company may adjust the carrying amount of certain non-financial assets to fair value on a non-recurring basis when they are impaired. The estimated carrying amount and fair value of the Company’s financial instruments measured and recorded at fair value on a recurring basis are as follows for the dates indicated (in thousands) : Fair value measurements at September 30, 2019 using Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs Significant Unobservable Inputs Total Fair Value September 30, 2019 Assets: Derivative asset $ — $ 767 $ — $ 767 Fair value measurements at December 31, 2018 using Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Fair Value December 31, 2018 Assets: Derivative asset $ — $ 6,659 $ — $ 6,659 Liabilities and assets classified as level 2 which are recorded at fair value are valued using observable market inputs. The fair values of derivative assets and liabilities are determined using quantitative models that utilize multiple market inputs including interest rates and exchange rates to generate continuous yield or pricing curves and volatility factors to value the position. The majority of market inputs are actively quoted and can be validated through external sources, including brokers, market transactions and third-party pricing services. The fair values of derivative assets and liabilities include adjustments for market liquidity, counter-party credit quality, and other instrument-specific factors, where appropriate. In addition, the Company incorporates within its fair value measurements a valuation adjustment to reflect the credit risk associated with the net position. Positions are netted by counter-parties, and fair value for net long exposures is adjusted for counter-party credit risk while the fair value for net short exposures is adjusted for the Company’s own credit risk. The estimated carrying amount and fair value of the Company’s financial instruments and liabilities for which fair value is only disclosed is as follows (in thousands) : Fair value measurements at September 30, 2019 using Carrying Amount September 30, 2019 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Fair Value September 30, 2019 Liabilities: Term Loan $ 1,168,533 $ — $ 1,129,645 $ — $ 1,129,645 Tax receivable agreement payable 88,775 — — 55,267 55,267 Fair value measurements at December 31, 2018 using Carrying Amount December 31, 2018 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Fair Value December 31, 2018 Liabilities: Term Loan $ 1,188,605 $ — $ 1,103,628 $ — $ 1,103,628 Tax receivable agreement payable (1) 88,775 — — 51,832 51,832 (1) During the first quarter of 2019, the Company identified a mathematical error in the 2018 10-K related to the disclosure of the fair value of the tax receivable agreement payable as of December 31, 2018. The fair value should have been $51.8 million , as opposed to $82.9 million , and is being corrected herein. This disclosure error did not have an impact on the Company's consolidated financial statements. The fair value of debt is valued using a market approach based on indicative quoted prices for our debt instruments traded in over-the-counter markets and, therefore, is classified as Level 2 within the fair value hierarchy. See Note 11, Debt and deferred financing costs, for a further discussion of Company debt. The determination of the fair value of the Company's tax receivable agreement payable was determined using a discounted cash flow methodology with level 3 inputs as defined by ASC 820, Fair Value Measurements and Disclosures . The determination of fair value required significant judgment, including estimates of the timing and amounts of various tax attributes. These estimates are based on management’s best knowledge of current events and actions that the Company may undertake in the future. Actual results could differ from these estimates. See Note 14, Commitments and contingencies, for a further discussion of the Company's tax receivable agreement. |
Accrued liabilities
Accrued liabilities | 9 Months Ended |
Sep. 30, 2019 | |
Payables and Accruals [Abstract] | |
Accrued liabilities | Accrued liabilities Accrued liabilities consist of the following (in thousands) : September 30, December 31, 2019 2018 Accrued payroll and employee benefits $ 28,395 $ 31,095 Short-term finance leases 16,578 16,430 Short-term operating leases 9,204 — Accrued taxes 12,228 11,489 Warranty 4,509 3,251 Accrued rebates 4,090 3,542 Environmental obligation 718 570 Other miscellaneous accrued liabilities 9,700 3,859 Total accrued liabilities $ 85,422 $ 70,236 |
Debt and deferred financing cos
Debt and deferred financing costs | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
Debt and deferred financing costs | Debt and deferred financing costs The Company’s debt consisted of the following (in thousands) : September 30, December 31, 2019 2018 Term Loan, net of debt issuance costs and original issuance discount of $28,442 and $34,252, respectively $ 1,168,533 $ 1,188,605 Total debt $ 1,168,533 $ 1,188,605 Less: current portion debt (12,510 ) (12,510 ) Total long-term debt $ 1,156,023 $ 1,176,095 Concurrent with the completion of the IPO, Forterra entered into a $300 million asset based revolving credit facility for working capital and general corporate purposes (“Revolver”) and a $1.05 billion senior term loan facility (“Term Loan”). The Term Loan initially provided for a $1.05 billion senior secured term loan. Subject to the conditions set forth in the term loan agreement, the Term Loan may be increased by (i) up to the greater of $285.0 million and 1.0x consolidated EBITDA (defined below) of Forterra and its restricted subsidiaries for the four quarters most recently ended prior to such incurrence plus (ii) the aggregate amount of any voluntary prepayments, plus (iii) an additional amount, provided certain financial tests are met. Effective May 1, 2017, the Company amended the Term Loan to increase the principal outstanding by an additional $200.0 million and to reduce the interest margins applicable to the full balance of the Term Loan by 50 basis points such that applicable margin based on LIBOR was reduced from 3.50% to 3.00% . The net proceeds from the incremental term loan of $196.8 million were used to pay down a portion of the outstanding balance on the Revolver. This amendment had no effect on the Company's ability to increase the size of the Term Loan under the original provisions. The Term Loan matures on October 25, 2023 and is subject to quarterly amortization equal to 0.25% of the initial principal amount. Interest accrues on outstanding borrowings thereunder at a rate equal to LIBOR (with a floor of 1.0% ) or an alternate base rate, in each case plus a margin of 3.00% or 2.00% , respectively. The weighted average interest rates for the Term Loan were 5.2% and 5.4% for the three and nine months ended September 30, 2019 , respectively, and 5.1% and 4.9% for the three and nine months ended September 30, 2018 , respectively. During September 2019, the Company repurchased $16.5 million of the Term Loan before its maturity at a market value of $15.7 million . Consequently, the Company wrote off a proportionate share of debt issuance costs of $0.4 million and recognized a net gain of $0.4 million on the early extinguishment of debt which was included in the condensed consolidated statements of operations. The Revolver provides for an aggregate principal amount of up to $300.0 million , with up to $280.0 million to be made available to the U.S. borrowers and up to $20.0 million to be made available to the Canadian borrowers (the allocation may be modified periodically at the Company's request). Subject to the conditions set forth in the revolving credit agreement related to the Revolver (the "Revolving Credit Agreement"), the Revolver may be increased by up to the greater of (i) $100.0 million and (ii) such amount as would not cause the aggregate borrowing base to be exceeded by more than $50.0 million . Borrowings under the Revolver may not exceed a borrowing base equal to the sum of (i) 100% of eligible cash, (ii) 85% of eligible accounts receivable and (iii) the lesser of (a) 75% of eligible inventory and (b) 85% of the orderly liquidation value of eligible inventory, with the U.S. and Canadian borrowings being subject to separate borrowing base limitations. The advance rates for accounts receivable and inventory are subject to increase by 2.5% during certain periods. As of September 30, 2019 , the Revolver had no outstanding borrowings, and the weighted average interest rate was 3.71% for borrowings during the period. As of December 31, 2018, there were no outstanding borrowings under the Revolver. The Revolver matures on October 25, 2021. The Revolver also provides for the issuance of letters of credit of up to an agreed sublimit. Interest accrues on outstanding borrowings at a rate equal to LIBOR or CDOR plus a margin ranging from 1.25% to 1.75% per annum, or at an alternate base rate, Canadian prime rate or Canadian base rate plus a margin ranging from 0.25% to 0.75% per annum, in each case, based upon the average excess availability under the Revolver for the most recently completed calendar quarter. The obligations of the borrowers under the Revolver are guaranteed by Forterra and its direct and indirect wholly-owned restricted subsidiaries other than certain excluded subsidiaries; provided that the obligations of the U.S. borrowers are not guaranteed by the Canadian subsidiaries. The Revolver is secured by substantially all of the assets of the borrowers; provided that the obligations of the U.S. borrowers are not secured by any liens on more than 65% of the voting stock of the Canadian subsidiaries or assets of the Canadian subsidiaries. In addition, Forterra pays a facility fee of between 20.0 and 32.5 basis points per annum based upon the utilization of the total Revolver. Availability under the Revolver at September 30, 2019 based on draws, and outstanding letters of credit of $17.3 million and allowable borrowing base was $282.7 million . Outstanding borrowings under the Term Loan are guaranteed by Forterra and each of its direct and indirect material wholly-owned domestic subsidiaries except certain excluded subsidiaries (the "Guarantors"). The Term Loan is secured by substantially all of the assets of Forterra, the borrower and the Guarantors; provided that the obligations under the Term Loan are not secured by any liens on more than 65% of the voting stock of the Canadian subsidiaries or assets of the Canadian subsidiaries. The Term Loan contains customary representations and warranties, and affirmative and negative covenants, that, among other things, restrict the ability of Forterra and its restricted subsidiaries to incur additional debt, incur or permit liens on assets, make investments and acquisitions, consolidate or merge with any other company, engage in asset sales and pay dividends and make distributions. The Term Loan does not contain any financial covenants. Obligations under the Term Loan may be accelerated upon certain customary events of default (subject to grace periods, as appropriate). The Revolver and the Term Loan contain customary representations and warranties, and affirmative and negative covenants, including representations, warranties, and covenants that, among other things, restrict the ability of Forterra and its restricted subsidiaries to incur additional debt, incur or permit liens on assets, make investments and acquisitions, consolidate or merge with any other company, engage in asset sales and pay dividends and make distributions. The Revolver contains a financial covenant restricting Forterra from allowing its fixed charge coverage ratio to drop below 1.00 :1.00 during a compliance period, which is triggered when the availability under the Revolver falls below a threshold set forth in the Revolving Credit Agreement. Obligations under the Revolver and the Term Loan may be accelerated upon certain customary events of default (subject to grace periods, as appropriate). The fixed charge coverage ratio is the ratio of consolidated earnings before interest, depreciation, and amortization (“EBITDA’’) less cash payments for capital expenditures and income taxes to consolidated fixed charges (interest expense plus scheduled payments of principal on indebtedness). As of September 30, 2019 , the Company was in compliance with all applicable covenants under the Revolver and the Term Loan. As of September 30, 2019 , scheduled maturities of long-term debt were as follows (in thousands): Term Loan 2019 $ 3,128 2020 12,510 2021 12,510 2022 12,510 2023 1,156,317 $ 1,196,975 |
Derivatives and hedging
Derivatives and hedging | 9 Months Ended |
Sep. 30, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives and hedging | Derivatives and hedging The Company uses derivatives to manage selected foreign exchange and interest rate exposures. The Company does not use derivative instruments for speculative trading purposes, and, except as discussed below, cash flows from derivative instruments are included in net cash provided by (used in) operating activities in the condensed consolidated statements of cash flows. On February 9, 2017, Forterra entered into interest rate swap transactions with a combined notional value of $525 million . Under the terms of the swap transactions, Forterra agreed to pay a fixed rate of interest of 1.52% and receive floating rate interest indexed to one-month LIBOR with monthly settlement terms with the swap counterparties. The swaps have a three -year term and expire on March 31, 2020. The interest rate swaps are not designated as cash flow hedges, therefore all changes in the fair value of these instruments are captured as a component of interest expense in the condensed consolidated statements of operations. Accordingly, cash flows from the monthly interest rate swap settlements are included in net cash provided by (used in) operating activities in the condensed consolidated statements of cash flows. The Company elects to present all derivative assets and derivative liabilities on a net basis on its condensed consolidated balance sheets when a legally enforceable International Swaps and Derivatives Association, Inc. (“ISDA”) Master Agreement exists. An ISDA Master Agreement is an agreement between two counterparties, which may have multiple derivative transactions with each other governed by such agreement, and such ISDA Master Agreement generally provides for the net settlement of all or a specified group of these derivative transactions, through a single payment, in a single currency, in the event of a default on, or affecting any, one derivative transaction or a termination event affecting all, or a specified group of, derivative transactions. At September 30, 2019 and December 31, 2018, the Company’s derivative instruments fall under an ISDA master netting agreement. The following table presents the fair values of derivative assets and liabilities in the condensed consolidated balance sheets (in thousands) : September 30, 2019 Derivative Assets Derivative Liabilities Notional Amount Fair Value Notional Amount Fair Value Interest rate swaps $ 525,000 $ 767 $ — $ — Total derivatives, gross 767 — Less: Legally enforceable master netting agreements — — Total derivatives, net $ 767 $ — December 31, 2018 Derivative Assets Derivative Liabilities Notional Amount Fair Value Notional Amount Fair Value Interest rate swaps $ 525,000 $ 6,659 $ — $ — Total derivatives, gross 6,659 — Less: Legally enforceable master netting agreements — — Total derivatives, net $ 6,659 $ — The following table presents the effect of derivative instruments on the condensed consolidated statements of operations (in thousands) : Three months ended Nine months ended September 30, September 30, 2019 2018 2019 2018 Net investment hedges Foreign exchange forward contracts Gain on derivatives recognized in Accumulated other comprehensive loss $ — $ — $ — $ 970 Derivatives not designated as hedges Interest rate swaps Gain (loss) on derivatives not designated as hedges included in interest expense (868 ) 71 (5,892 ) 4,291 |
Leases
Leases | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Leases | Leases The Company leases land and buildings, office spaces, vehicles, machinery and equipment under various lease agreements. A large portion of the Company’s leases were the result of the sale and leaseback of land and buildings related to certain production facilities. These leases have an initial term of 25 years , followed by one optional renewal term of approximately ten years that may be exercised at the Company’s discretion. These leases, with the exception of certain land leases, were classified as finance leases. The Company’s operating leases are mainly comprised of land and buildings, office spaces, vehicles, machinery and equipment leases, and have remaining terms of one to 25 years , some of which include options to extend the leases for up to 10 years . The components of lease expense were as follows (in thousands): Lease cost Classification Three months ended September 30, 2019 Nine months ended September 30, 2019 Operating lease cost Lease expense $ 4,188 $ 12,409 Finance lease cost Amortization of leased assets Depreciation, amortization, and accretion 656 1,753 Interest on lease liabilities Interest expense 4,679 13,832 Lease term and discount rate September 30, 2019 Weighted-average remaining lease term (years) Operating leases 15.4 years Finance leases 33.4 years Weighted-average discount rate (%) Operating leases 12.6 % Finance leases 12.3 % Supplemental cash flow information related to leases was as follows (in thousands): Nine months ended September 30, 2019 Cash paid for amounts included in lease liabilities Operating cash flows related to operating leases $ 11,146 Operating cash flows related to finance leases 12,032 Financing cash flows related to finance leases 430 Leased assets obtained in exchange for new finance lease liabilities 42 Leased assets obtained in exchange for new operating lease liabilities 4,711 Supplemental balance sheet information related to leases was as follows (in thousands): Classification September 30, 2019 Operating leases Right of use assets Operating lease right-of-use assets $ 62,252 Operating lease liabilities - current portion Accrued liabilities (9,204 ) Operating lease liabilities - long term portion Long-term operating lease liabilities (55,669 ) Finance leases Finance lease assets Property, plant and equipment, net 50,265 Finance lease liabilities - current portion Accrued liabilities (16,578 ) Finance lease liabilities - long term portion Long-term finance lease liabilities (136,556 ) As of September 30, 2019 , maturities of lease liabilities were as follows (in thousands): Operating leases Finance leases Total 2019 $ 3,784 $ 4,204 $ 7,988 2020 13,702 16,841 30,543 2021 11,330 16,995 28,325 2022 10,463 17,245 27,708 2023 10,215 17,461 27,676 Thereafter 119,300 669,477 788,777 Total lease payments 168,794 742,223 911,017 Less: imputed interest (103,921 ) (589,089 ) (693,010 ) Present value of lease liabilities $ 64,873 $ 153,134 $ 218,007 |
Leases | Leases The Company leases land and buildings, office spaces, vehicles, machinery and equipment under various lease agreements. A large portion of the Company’s leases were the result of the sale and leaseback of land and buildings related to certain production facilities. These leases have an initial term of 25 years , followed by one optional renewal term of approximately ten years that may be exercised at the Company’s discretion. These leases, with the exception of certain land leases, were classified as finance leases. The Company’s operating leases are mainly comprised of land and buildings, office spaces, vehicles, machinery and equipment leases, and have remaining terms of one to 25 years , some of which include options to extend the leases for up to 10 years . The components of lease expense were as follows (in thousands): Lease cost Classification Three months ended September 30, 2019 Nine months ended September 30, 2019 Operating lease cost Lease expense $ 4,188 $ 12,409 Finance lease cost Amortization of leased assets Depreciation, amortization, and accretion 656 1,753 Interest on lease liabilities Interest expense 4,679 13,832 Lease term and discount rate September 30, 2019 Weighted-average remaining lease term (years) Operating leases 15.4 years Finance leases 33.4 years Weighted-average discount rate (%) Operating leases 12.6 % Finance leases 12.3 % Supplemental cash flow information related to leases was as follows (in thousands): Nine months ended September 30, 2019 Cash paid for amounts included in lease liabilities Operating cash flows related to operating leases $ 11,146 Operating cash flows related to finance leases 12,032 Financing cash flows related to finance leases 430 Leased assets obtained in exchange for new finance lease liabilities 42 Leased assets obtained in exchange for new operating lease liabilities 4,711 Supplemental balance sheet information related to leases was as follows (in thousands): Classification September 30, 2019 Operating leases Right of use assets Operating lease right-of-use assets $ 62,252 Operating lease liabilities - current portion Accrued liabilities (9,204 ) Operating lease liabilities - long term portion Long-term operating lease liabilities (55,669 ) Finance leases Finance lease assets Property, plant and equipment, net 50,265 Finance lease liabilities - current portion Accrued liabilities (16,578 ) Finance lease liabilities - long term portion Long-term finance lease liabilities (136,556 ) As of September 30, 2019 , maturities of lease liabilities were as follows (in thousands): Operating leases Finance leases Total 2019 $ 3,784 $ 4,204 $ 7,988 2020 13,702 16,841 30,543 2021 11,330 16,995 28,325 2022 10,463 17,245 27,708 2023 10,215 17,461 27,676 Thereafter 119,300 669,477 788,777 Total lease payments 168,794 742,223 911,017 Less: imputed interest (103,921 ) (589,089 ) (693,010 ) Present value of lease liabilities $ 64,873 $ 153,134 $ 218,007 |
Commitments and contingencies
Commitments and contingencies | 9 Months Ended |
Sep. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and contingencies | Commitments and contingencies Legal matters The Company is involved in legal proceedings and litigation in the ordinary course of business. In the opinion of management, the outcome of such matters will not have a material adverse effect on the Company’s condensed consolidated financial position, results of operations, or liquidity. Other than routine litigation incidental to the Company's business and those matters described below, there are no material legal proceedings to which the Company is a party or to which any of the Company’s properties are subject. Earnout Dispute The Acquisition included an earnout, which was contingent consideration of up to $100.0 million , if and to the extent the 2015 financial results of the businesses acquired by Lone Star in the Acquisition, including the Company and HC's former building products business in the United Kingdom, exceeded a specified Adjusted EBITDA target for fiscal year 2015, as calculated pursuant to the terms of the purchase agreement. If such Adjusted EBITDA calculation exceeded the specified target, LSF9 and, as a result of the Reorganization, the Company would be required to pay the U.S. affiliate of HC an amount equal to a multiple of such excess Adjusted EBITDA, with any payment capped at $100.0 million . In April 2016, the Company provided an earnout statement to affiliates of HC demonstrating that no payment was required. On June 13, 2016, HC provided notification that it disputes, among other things, the Company’s calculation of Adjusted EBITDA under the purchase agreement and asserting that a payment should be made in the amount of $100.0 million . The Company does not believe HC’s position has merit and is vigorously opposing HC's assertions. On October 5, 2016, affiliates of HC filed a lawsuit in the Delaware Court of Chancery seeking specific performance and claiming access to the Company's books, records, and personnel; seeking a declaratory judgment concerning the scope of the neutral accounting expert’s authority; and in the alternative, claiming a breach of contract and seeking the $100.0 million and other damages (the "Delaware Action"). On December 8, 2017, the court granted the defendants' Motion to Dismiss the First Amended Complaint in the Delaware Action, finding that the earnout dispute should be heard before a neutral accounting arbitrator as set forth in the purchase agreement and that any claims that required to be brought as indemnification claims under the purchase agreement were time-barred by the contractual limitations period. Following the dismissal of the Delaware Action, the Company and HC jointly engaged a neutral accounting expert to act as an arbitrator in the dispute as required by the purchase agreement. The parties then briefed certain preliminary matters for the arbitrator and the Company produced additional documents to HC. The parties are currently negotiating a schedule for briefing on the merits of their claims to the arbitrator. As of September 30, 2019 , no liability for this contingency has been accrued as payment of any earnout is not considered probable. However, the outcome of this matter is uncertain, and no assurance can be given to the ultimate outcome of the resulting proceedings. If the Company is unsuccessful in resolving the dispute, it could recognize a material charge to its earnings. Securities Lawsuit and Shareholder Derivative Action Beginning on August 14, 2017, four plaintiffs filed putative class action complaints in the United States District Court for the Eastern District of New York against various defendants. On July 27, 2018, an order was entered consolidating the lawsuits into a single action (the "Securities Action"), and transferring the venue of the case from the Eastern District of New York to the Northern District of Texas. On September 17, 2018, an order was entered appointing Wladislaw Maciuga as lead plaintiff and approving his counsel as lead counsel. Pursuant to an agreed scheduling order, plaintiffs in the Securities Action filed their Consolidated Amended Complaint on November 30, 2018. The Securities Action is brought by two plaintiffs individually and on behalf of all persons that purchased or otherwise acquired the Company's common stock issued pursuant to and/or traceable to the IPO and is brought against the Company, certain of its current and former officers and directors, Lone Star and certain of its affiliates, and certain banks that acted as underwriters of the IPO (collectively, the “Securities Defendants”). The Securities Action generally alleges that the Company's registration statement on Form S-1 filed in connection with the IPO (the "Registration Statement") contained fals e or misleading statements and/or omissions of material facts. Specifically, plaintiffs allege the Registration Statement (1) made false and/or misleading statements about the Company's ability to generate organic growth through cross-selling initiatives amongst the Company's various businesses while failing to disclose that the Company had not adequately integrated acquisitions, had not begun rolling out its cross-selling initiative, and that its businesses were submitting competing bids against one another, and (2) made false or misleading statements regarding the existence of certain accounting practices and alleged material weaknesses in the Company's internal controls over financial reporting, including the existence of and accounting for bill and hold transactions, the lack of sufficient accounting personnel, the lack of effective internal controls to ensure costs were properly and accurately accrued, resulting in misstated costs and profits in the Company's 2016 financial statements, and the making of inventory accounting entries without adequate substantiation or documentation. The Securities Action asserts claims under Section 11 and Section 15 of the Securities Act of 1933, as amended, (the "Securities Act") and seeks (1) class certification under the Federal Rules of Civil Procedure, (2) damages suffered by plaintiffs and other class members, (3) prejudgment and post-judgment interest, (4) reasonable counsel fees and expert fees, and other costs and expenses reasonably incurred, and (5) other relief the court deems appropriate. On February 15, 2019, the Securities Defendants filed a Motion to Dismiss all claims in the case based on plaintiffs' failure to state a claim. Briefing on the motion to dismiss was completed on May 1, 2019, and the court has not yet ruled on the motion. A mediation of the Securities Action occurred in August 2019. On November 4, 2019, the parties to the Securities Action entered into a settlement agreement that is intended to fully and finally resolve all claims in the Securities Action. The parties intend to seek court approval for the settlement, but approval cannot be guaranteed. The terms of the settlement are expected to be paid by the Company's insurance. On July 31, 2018, a putative shareholder derivative complaint captioned Maloney v. Bradley, et al., was filed in the United States District Court for the Northern District of Texas, naming as defendants certain of the Company’s current and former directors and officers (the "Maloney Texas Action"). The complaint alleges the defendants breached their fiduciary duties, committed constructive fraud, and wasted corporate assets, and also asserts unjust enrichment claims against certain defendants. The complaint seeks, on behalf of the Company, unspecified damages, an order directing the return of certain payments to the defendants and imposing a constructive trust thereon, certain injunctive relief, reasonable costs and attorneys' fees, and punitive damages. On November 16, 2018, the defendants filed motions to dismiss the Maloney Texas Action on the grounds that it was brought in the wrong venue in violation of the Company's Amended and Restated Certificate of Incorporation, that plaintiffs failed to make a pre-suit demand as required by applicable law and that plaintiff's complaint fails to state a claim. On July 30, 2019, the court in the Maloney Texas Action granted the defendants' motion to dismiss on the grounds that the case should have been brought in Delaware according to the Company's Amended and Restated Certificate of Incorporation. On September 23, 2019, the same plaintiff filed a putative shareholder derivative complaint captioned Maloney v. Bradley, et al. in the United States District Court for the District of Delaware, naming as defendants certain of the Company’s current and former directors and officers (the "Maloney Delaware Action"). The complaint alleges the defendants violated Sections 14A and 20(A) of the Securities and Exchange Act of1934, as amended, breached their fiduciary duties, and wasted corporate assets, and also asserts unjust enrichment claims against certain defendants. The complaint seeks, on behalf of the Company, unspecified damages, an order directing the return of certain payments to the defendants and imposing a constructive trust thereon, certain injunctive relief, reasonable costs and attorneys' fees, and punitive damages. On January 15, 2019, a putative shareholder derivative complaint captioned Lee v. Bradley, et al., was filed in the United States District Court for the District of Delaware, naming as defendants certain of the Company’s current and former directors and officers (the "Lee Action"). The complaint alleges the defendants violated Section 14A of the Securities and Exchange Act of1934, as amended, and related rules by failing to make certain disclosures in the Company's proxy solicitation in advance of the 2017 Annual Meeting of Stockholders, and that defendants breached their fiduciary duties, wasted corporate assets, and committed constructive fraud. The complaint also asserts unjust enrichment claims against certain defendants. The complaint seeks, on behalf of the Company, unspecified damages, an order directing the return of certain payments to the defendants, certain injunctive relief, and reasonable costs and attorneys' fees. On April 18, 2019, the court entered an agreed stipulation staying the Lee Action until the court in the Securities Action rules on the motion to dismiss in that case. The Company and other defendants are vigorously defending the Maloney Delaware Action and the Lee Action. Given the stage of the proceedings, the Company cannot reasonably estimate at this time the possible loss or range of loss, if any, that may arise from the Maloney Delaware Action or the Lee Action. Long-term incentive plan Following the Acquisition, Lone Star implemented a cash-based long term incentive plan (the “LTIP”), which entitles the participants in the LTIP a potential cash payout upon a monetization event as defined by the LTIP. Potential monetization events include the sale, transfer or otherwise disposition of all or a portion of the Company or successor entities of LSF9, an initial public offering where Lone Star reduces its ownership interest in the Company or successor entities of LSF9, or through certain cash distribution as defined in the LTIP. Before the payout of any cash the LTIP requires Lone Star realize in cash the full return of their investment plus a specified internal rate of return, which is calculated by comparing the return to Lone Star over the timeline of its investment in the Company and certain successor entities of LSF9. As of September 30, 2019 , no such monetization events that meet the required return for an LTIP payment have occurred, and therefore no amounts were accrued in the accompanying condensed consolidated balance sheets. While no payments have occurred thus far, payments under the LTIP could be significant depending upon future monetization events. The timing and amount of such payments are unknown and is dependent upon future monetization events and market conditions that are outside of the control of the Company or the participants of the plan. Subsequent to the IPO, Forterra became directly liable for any payment obligations triggered under the LTIP, but LSF9 or one of its affiliates will remain obligated to make payments to the Company in amounts equal to any payment obligations triggered under the LTIP as and when such payment obligations are triggered. Tax receivable agreement The Company has a tax receivable agreement (the "TRA") with Lone Star that provides for, among other things, the payment by the Company to Lone Star of 85% of the amount of certain covered tax benefits, which may reduce the actual liability for certain taxes that the Company might otherwise be required to pay. The tax benefits subject to the TRA include: (i) all depreciation and amortization deductions, and any offset to taxable income and gain or increase to taxable loss, resulting from the tax basis that the Company had in its assets as of the time of the consummation of the IPO, (ii) the utilization of the Company's and its subsidiaries’ net operating losses and tax credits, if any, attributable to periods prior to the IPO, (iii) deductions in respect of payments made, funded or reimbursed by an initial party to the tax receivable agreement (other than the Company or one of its subsidiaries) or an affiliate thereof to participants under the LTIP, (iv) deductions in respect of transaction expenses attributable to the acquisition of USP Holdings, Inc. and (v) certain other tax benefits attributable to payments made under the tax receivable agreement. For purposes of the TRA, the aggregate reduction in income tax payable by the Company will be computed by comparing the Company's actual income tax liability with its hypothetical liability had it not been able to utilize the related tax benefits. The agreement will remain in effect for the period of time in which any such related tax benefits remain. The Company accounts for potential payments under the TRA as a contingent liability, with amounts accrued when considered probable and reasonably estimable. The liability recorded by the Company for the TRA at September 30, 2019 and December 31, 2018 was $88.8 million and $88.8 million , respectively. The timing and amount of future tax benefits associated with the TRA are subject to change, and additional payments may be required which could be materially different from the current accrued liability. The Company anticipates that it will have sufficient taxable income in future periods to realize the full value of the obligation recorded. Future tax receivable agreement payments related to the tax basis of assets at the time of the IPO will be recorded as a reduction to the liability and will be recorded as a financing activity in the consolidated statement of cash flows. During the nine months ended September 30, 2019 , no payments have been made on the TRA to Lone Star. |
Earnings per share
Earnings per share | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Earnings per share | Earnings per share Basic earnings per share ( “ EPS ” ) is calculated by dividing net earnings by the weighted average number of shares of common stock outstanding during the period. Potentially dilutive securities include employee stock options and shares of restricted stock. Diluted EPS reflects the assumed exercise, vesting or conversion of all dilutive securities. The calculations of the basic and diluted EPS for the three and nine months ended September 30, 2019 and 2018 are presented below (in thousands, except per share amounts) : For the three months ended September 30, For the nine months ended September 30, 2019 2018 2019 2018 Net income (loss) $ 22,430 $ 5,503 $ 345 $ (7,413 ) Less: Earnings allocated to unvested restricted stock awards 40 25 — — Earnings (loss) allocated to common shareholders $ 22,390 $ 5,478 $ 345 $ (7,413 ) Common stock: Weighted average basic shares outstanding 64,210 63,919 64,119 63,883 Effect of dilutive securities 788 350 409 — Weighted average diluted shares outstanding 64,998 64,269 64,528 63,883 Basic earnings (loss) per share: Net income (loss) $ 0.35 $ 0.09 $ 0.01 $ (0.12 ) Diluted earnings (loss) per share: Net income (loss) $ 0.34 $ 0.09 $ 0.01 $ (0.12 ) As detailed further below, potential dilutive shares of common stock were anti-dilutive as a result of the Company's net loss for the nine months ended September 30, 2018. As a result, basic weighted average shares were used in the calculations of basic earnings per share and diluted earnings per share for those periods. The number of stock options and restricted shares that were excluded from the computation of diluted earnings per share because their inclusion would result in an anti-dilutive effect on per share amounts for the three months ended September 30, 2019 and September 30, 2018 and the nine months ended September 30, 2019 and September 30, 2018 were 2,015,399 , 3,032,201 , 3,963,041 and 2,559,752 , respectively. |
Income taxes
Income taxes | 9 Months Ended |
Sep. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Income taxes | Income taxes The Company recorded income tax expense from continuing operations of $5.9 million and income tax benefit of $0.5 million for the three and nine months ended September 30, 2019 , respectively, and an income tax expense of $2.8 million and $6.4 million for the three and nine months ended September 30, 2018 , respectively. The income tax expense for the three months ended September 30, 2019 differs from the expense computed at the federal statutory rate primarily due to the unfavorable foreign rate differential and inclusion of the global intangible low-taxed income ("GILTI"), offset by the foreign tax credit and the favorable return-to-provision adjustment recorded in the quarter. The income tax benefit for the nine months ended September 30, 2019 differs from the benefit computed at the federal statutory rate primarily due to the unfavorable permanent add-back of the non-deductible one-time executive severance payment and GILTI inclusion, offset by the favorable state benefit and favorable return-to-provision adjustment recorded in the period. The income tax expense for the three months ended September 30, 2018 differs from the expense computed at the statutory rate primarily due to an increase in the unfavorable inclusion of GILTI, unfavorable return-to-provision adjustment and an increase to the valuation allowance in certain state and foreign jurisdictions. The income tax expense for the nine months ended September 30, 2018 is higher than the benefit computed at the statutory rate primarily due to changes in the Company's valuation allowance, unfavorable inclusion of GILTI and the unfavorable impact of the disposition of nondeductible goodwill in connection with a divestiture transaction that occurred in the three months ended March 31, 2018. The Company evaluates the recoverability of its deferred tax assets quarterly to determine if valuation allowances are required or should be adjusted. The Company assesses whether valuation allowances should be established against deferred tax assets based on consideration of all available evidence, both positive and negative, using a “more likely than not” standard. The analysis used in determining the valuation allowance involves considerable judgment and assumptions. After consideration of all evidence, the Company increased the valuation allowance by $3.7 million for the nine months ended September 30, 2018. The Company's quarterly provision for income taxes has historically been calculated using the annual effective rate method, which applies an estimated annual effective tax rate to pre-tax income or loss. However, when the result of the expected annual effective tax rate is not deemed reliable and distorts the income tax provision for an interim period, the Company calculates the income tax provision or benefit using the actual year-to-date effective tax rate (the "discrete method"), which results in an income tax provision or benefit based solely on the year-to-date pre-tax income or loss as adjusted for permanent differences on a pro rata basis. The Company has recorded its interim income tax provision using the discrete method, as allowed under ASC 740-270, Accounting for Income Taxes - Interim Reporting for the nine months ended September 30, 2019. |
Segment reporting
Segment reporting | 9 Months Ended |
Sep. 30, 2019 | |
Segment Reporting [Abstract] | |
Segment reporting | Segment reporting Segment information is presented in accordance with ASC 280, Segment Reporting , which establishes standards for reporting information about operating segments. It also establishes standards for related disclosures about products and geographic areas. Operating segments are defined as components of an enterprise that engage in business activities that earn revenues, incur expenses and prepare separate financial information that is evaluated regularly by the Company’s chief operating decision maker ( “ CODM ” ) in order to allocate resources and assess performance. The Company's Chief Executive Officer is its CODM. The Corporate and Other segment includes expenses related to certain executive salaries, interest costs related to the Company's credit agreements, acquisition-related costs, and other corporate costs that are not directly attributable to the Company's operating segments. The Company's segments follow the same accounting policies as the Company. Net sales from the major products sold to external customers include drainage pipe and precast products and concrete and steel water transmission pipe. The Company’s three geographic areas consist of the United States, Canada, and Mexico for which it reports net sales, fixed assets and total assets. For purposes of evaluating segment profit, the CODM reviews EBITDA as a basis for making the decisions to allocate resources and assess performance. The following tables set forth the disaggregation of revenue earned from contracts with customers based on the Company's reportable segments as well as other financial information attributable to the Company's reportable segments for the three and nine months ended September 30, 2019 and 2018 (in thousands) : For the three months ended September 30, For the nine months ended September 30, 2019 2018 2019 2018 Net sales: Drainage Pipe & Products $ 280,678 $ 242,997 $ 686,092 $ 621,523 Water Pipe & Products 183,848 191,513 480,511 519,031 Corporate and Other — — — 3 Total $ 464,526 $ 434,510 $ 1,166,603 $ 1,140,557 Depreciation and amortization: Drainage Pipe & Products $ 9,317 $ 10,447 $ 27,975 $ 30,898 Water Pipe & Products 14,511 15,218 43,981 47,775 Corporate and Other 344 257 998 697 Total $ 24,172 $ 25,922 $ 72,954 $ 79,370 Segment EBITDA and reconciliation to income (loss) before income taxes: Drainage Pipe & Products $ 67,361 $ 53,271 $ 141,424 $ 122,841 Water Pipe & Products 25,557 17,818 59,271 48,923 Corporate and Other (17,147 ) (14,931 ) (54,195 ) (40,463 ) Less: Interest expense (23,272 ) (21,940 ) (73,720 ) (52,993 ) Depreciation and amortization (24,172 ) (25,922 ) (72,954 ) (79,370 ) Income (loss) before income taxes $ 28,327 $ 8,296 $ (174 ) $ (1,062 ) Capital expenditures: Drainage Pipe & Products $ 3,302 $ 9,397 $ 18,750 $ 18,702 Water Pipe & Products 3,232 3,080 7,757 10,732 Corporate and Other 61 728 2,524 992 Total $ 6,595 $ 13,205 $ 29,031 $ 30,426 September 30, December 31, 2019 2018 Total assets: Drainage Pipe & Products $ 890,239 $ 800,454 Water Pipe & Products 914,884 922,162 Corporate and Other 61,023 70,636 Total $ 1,866,146 $ 1,793,252 The Company has an investment in an equity method investee included in the Drainage Pipe & Products segment for which earnings from equity method investee were $4.0 million , $9.0 million , $2.2 million and $7.7 million for the three and nine months ended September 30, 2019 and September 30, 2018 , respectively, and with the following balances (in thousands) : September 30, December 31, 2019 2018 Investment in equity method investee $ 53,065 $ 50,607 Disaggregated revenue by geographic location is provided in the tables below. The Company has operations in the United States, Canada and Mexico. The economic characteristics of the Company's customers does not significantly vary across geographic locations or product lines. The Company has both revenues and long-lived assets in each country; and those assets and revenues are recorded within geographic location as follows (in thousands) : Property, plant, and equipment, net: September 30, December 31, 2019 2018 United States $ 424,595 $ 441,773 Canada 43,126 40,331 Mexico 9,552 10,063 $ 477,273 $ 492,167 Net sales: For the three months ended September 30, For the nine months ended September 30, 2019 2018 2019 2018 United States $ 435,706 $ 406,479 $ 1,104,164 $ 1,071,918 Canada 26,458 25,160 56,113 61,046 Mexico 2,362 2,871 6,326 7,593 $ 464,526 $ 434,510 $ 1,166,603 $ 1,140,557 |
Related party transactions
Related party transactions | 9 Months Ended |
Sep. 30, 2019 | |
Related Party Transactions [Abstract] | |
Related party transactions | Related party transactions Tax receivable agreement In connection with the IPO, the Company entered into the TRA with Lone Star that provides for, among other things, the payment by the Company to Lone Star of 85% of the amount of certain covered tax benefits, which may reduce the actual liability for certain taxes that the Company might otherwise be required to pay. See Note 14, Commitments and contingencies, for additional information on the tax receivable agreement. CP&P The Company sold certain goods and services to its joint venture, CP&P, including spare parts for repairs, and property rentals. For the nine months ended September 30, 2019 , Forterra sold $0.3 million of product to CP&P and purchased goods and services from CP&P for an amount of $0.2 million . For the nine months ended September 30, 2018, Forterra sold $0.1 million of product to CP&P and purchased $0.1 million of goods and services from CP&P. Bricks Joint Venture Prior to the IPO, LSF9 distributed its brick operations in the United States and Eastern Canada to a joint venture formed by an affiliate of Lone Star (the "Bricks Disposition"). In connection with the Bricks Disposition, Forterra entered into a transition services agreement with the joint venture, whereby Forterra would continue to provide certain administrative services, including but not limited to information technology, accounting and treasury for a limited period of time. Such transition services ended in February 2018. During the transition period, the Company collected cash from as well as settled invoices and payroll on behalf of the joint venture. As a result, Forterra had a net receivable from affiliates of $4.4 million as of December 31, 2018 included in other current assets. Such amount was subsequently collected during the second quarter of 2019. |
Summary of significant accoun_2
Summary of significant accounting policies (Policies) | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The Company's condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) and include the accounts and results of operations of the Company and its consolidated subsidiaries. |
Consolidation | All intercompany transactions have been eliminated in consolidation. |
Reclassifications | Certain prior year numbers were reclassified to conform with current year presentation. Such reclassification had no impact on the previously reported results of operations. |
Use of Estimates | The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities as of the reporting date, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. These estimates are based on management’s best knowledge of current events and actions that the Company may undertake in the future. The more significant estimates made by management relate to fair value estimates for assets and liabilities acquired in business combinations; estimates for accrued liabilities for environmental cleanup, bodily injury and insurance claims; estimates for commitments and contingencies; and estimates for the realizability of deferred tax assets, the tax receivable agreement obligation, inventory reserves, allowance for doubtful accounts and impairment of goodwill and long-lived assets. |
Leases | The Company determines if an arrangement is a lease at inception. Leases with an initial term of less than 12 months are not recorded on the balance sheet. Operating leases are included in operating lease right-of-use (“ROU”) assets, accrued liabilities, and long-term operating lease liabilities in the condensed consolidated balance sheets. Finance leases are included in property, plant and equipment, accrued liabilities, and long-term finance lease liabilities in the condensed consolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term, and lease liabilities represent the Company's obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The Company uses the implicit rate when readily determinable. The lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components, which are generally accounted for separately. For machinery and equipment leases, such as forklifts, the Company accounts for the lease and non-lease components as a single lease component. |
Recent Accounting Guidance Adopted | In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-02, Leases (Topic 842) , which establishes the principles that lessees and lessors shall apply to report information about the amount, timing, and uncertainty of cash flows arising from a lease. Under the new guidance, lessees are required to recognize a right-of-use asset and a lease liability, measured on a discounted basis, at the commencement date for all leases with terms greater than twelve months. Additionally, this guidance will require disclosures to help investors and other financial statement users better understand the amount, timing and uncertainty of cash flows arising from leases, including qualitative and quantitative requirements. The Company adopted Topic 842 during the first quarter of 2019, using the transition approach that permits application of the new standard at the adoption date instead of the earliest comparative period presented in the financial statements. To adopt Topic 842, the Company elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allowed the Company to carry forward its historical assessments of (1) whether the existing contracts contained a lease, (2) the lease classification for existing leases, and (3) initial direct cost for existing leases. In addition to the package of practical expedients, the Company has elected the adoption expedients of (1) the exclusion of leases with terms less than 12 months, and (2) the election not to separate non-lease components from lease components for certain classes of underlying leased assets. To adopt Topic 842, the Company recognized a cumulative catch-up adjustment to the opening balance sheet presented January 1, 2019. The adoption of the standard had a material impact on the Company’s condensed consolidated balance sheet but did not have an impact on its condensed consolidated statements of operations, comprehensive income (loss) or cash flows. As a result of the adoption, the Company has recorded additional lease assets and lease liabilities of approximately $63.9 million and $65.2 million , respectively, as of January 1, 2019. In addition, the Company recognized the carrying value of deferred gains related to certain sale and operating leaseback of land of $9.3 million , net of tax impact of $2.3 million , to beginning retained deficit as of January 1, 2019, in accordance with ASC 842-10-65-1. |
Receivables, net (Tables)
Receivables, net (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Receivables [Abstract] | |
Schedule of receivables, net and allowance for doubtful accounts | Receivables consist of the following (in thousands) : September 30, December 31, 2019 2018 Trade receivables $ 262,506 $ 188,999 Amounts billed but not yet paid under retainage provisions 2,856 2,065 Other receivables 23,564 9,545 Total receivables 288,926 200,609 Less: Allowance for doubtful accounts (2,581 ) (2,141 ) Receivables, net $ 286,345 $ 198,468 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of inventories | Inventories consist of the following (in thousands) : September 30, December 31, 2019 2018 Finished goods $ 170,000 $ 193,603 Raw materials 86,025 90,376 Work in process 620 1,051 Total inventories $ 256,645 $ 285,030 |
Investment in equity method i_2
Investment in equity method investee (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Schedule of Company's distribution and earnings and selected financial data from equity investment | The following reflects the Company's distribution and earnings in the equity investment (in thousands) : Three months ended Nine months ended September 30, September 30, 2019 2018 2019 2018 Distribution received from CP&P $ (5,000 ) $ (3,875 ) $ (6,500 ) $ (8,875 ) Share of earnings in CP&P 4,008 2,242 9,013 7,799 Amortization of excess fair value of investment (18 ) (18 ) (54 ) (54 ) Selected financial data for CP&P on a 100% basis is as follows ( in thousands ): Three months ended Nine months ended September 30, September 30, 2019 2018 2019 2018 Net sales $ 38,210 $ 31,864 $ 103,812 $ 96,537 Gross profit 12,632 9,042 32,307 28,537 Income from operations 8,021 4,540 18,041 15,235 Net income 7,959 4,479 17,852 15,052 |
Property, plant and equipment_2
Property, plant and equipment, net (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property, plant and equipment, net | Property, plant and equipment, net, consist of the following (in thousands) : September 30, December 31, 2019 2018 Machinery and equipment $ 391,957 $ 373,881 Land, buildings and improvements 237,465 235,819 Other equipment 8,005 6,962 Construction-in-progress 28,668 32,448 Total property, plant and equipment 666,095 649,110 Less: accumulated depreciation (188,822 ) (156,943 ) Property, plant and equipment, net $ 477,273 $ 492,167 |
Goodwill and other intangible_2
Goodwill and other intangible assets, net (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill by operating segment | The following table summarizes the changes in goodwill by operating segment for the nine months ended September 30, 2019 ( in thousands ): Drainage Pipe & Products Water Pipe & Products Total Balance at December 31, 2018 $ 189,833 $ 318,360 $ 508,193 Foreign currency and other adjustments 395 — 395 Balance at September 30, 2019 $ 190,228 $ 318,360 $ 508,588 |
Schedule of intangible assets | Intangible assets other than goodwill at September 30, 2019 and December 31, 2018 included the following ( in thousands ): Net carrying value as of September 30, 2019 Net carrying value as of December 31, 2018 Customer relationships and contracts $ 109,769 $ 131,473 Trade names 20,850 24,523 Patents 8,581 11,304 Non-compete agreements 8,801 9,574 Developed technology 6,074 — In-Process R&D (1) — 6,354 Other 483 561 Total intangible assets $ 154,558 $ 183,789 (1) Reclassified to developed technology in the first quarter of 2019. |
Fair value measurement (Tables)
Fair value measurement (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of estimated carrying amount and fair value of financial instruments measured and recorded at fair value on recurring basis | The estimated carrying amount and fair value of the Company’s financial instruments measured and recorded at fair value on a recurring basis are as follows for the dates indicated (in thousands) : Fair value measurements at September 30, 2019 using Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs Significant Unobservable Inputs Total Fair Value September 30, 2019 Assets: Derivative asset $ — $ 767 $ — $ 767 Fair value measurements at December 31, 2018 using Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Fair Value December 31, 2018 Assets: Derivative asset $ — $ 6,659 $ — $ 6,659 |
Schedule of carrying and fair value amounts for financial instruments | The estimated carrying amount and fair value of the Company’s financial instruments and liabilities for which fair value is only disclosed is as follows (in thousands) : Fair value measurements at September 30, 2019 using Carrying Amount September 30, 2019 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Fair Value September 30, 2019 Liabilities: Term Loan $ 1,168,533 $ — $ 1,129,645 $ — $ 1,129,645 Tax receivable agreement payable 88,775 — — 55,267 55,267 Fair value measurements at December 31, 2018 using Carrying Amount December 31, 2018 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Fair Value December 31, 2018 Liabilities: Term Loan $ 1,188,605 $ — $ 1,103,628 $ — $ 1,103,628 Tax receivable agreement payable (1) 88,775 — — 51,832 51,832 (1) During the first quarter of 2019, the Company identified a mathematical error in the 2018 10-K related to the disclosure of the fair value of the tax receivable agreement payable as of December 31, 2018. The fair value should have been $51.8 million , as opposed to $82.9 million , and is being corrected herein. This disclosure error did not have an impact on the Company's consolidated financial statements. |
Accrued liabilities (Tables)
Accrued liabilities (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Payables and Accruals [Abstract] | |
Schedule of accrued liabilities | Accrued liabilities consist of the following (in thousands) : September 30, December 31, 2019 2018 Accrued payroll and employee benefits $ 28,395 $ 31,095 Short-term finance leases 16,578 16,430 Short-term operating leases 9,204 — Accrued taxes 12,228 11,489 Warranty 4,509 3,251 Accrued rebates 4,090 3,542 Environmental obligation 718 570 Other miscellaneous accrued liabilities 9,700 3,859 Total accrued liabilities $ 85,422 $ 70,236 |
Debt and deferred financing c_2
Debt and deferred financing costs (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt | The Company’s debt consisted of the following (in thousands) : September 30, December 31, 2019 2018 Term Loan, net of debt issuance costs and original issuance discount of $28,442 and $34,252, respectively $ 1,168,533 $ 1,188,605 Total debt $ 1,168,533 $ 1,188,605 Less: current portion debt (12,510 ) (12,510 ) Total long-term debt $ 1,156,023 $ 1,176,095 |
Schedule of maturities of long-term debt | As of September 30, 2019 , scheduled maturities of long-term debt were as follows (in thousands): Term Loan 2019 $ 3,128 2020 12,510 2021 12,510 2022 12,510 2023 1,156,317 $ 1,196,975 |
Derivatives and hedging (Tables
Derivatives and hedging (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of fair values of derivative assets and liabilities in condensed consolidated balance sheets | The following table presents the fair values of derivative assets and liabilities in the condensed consolidated balance sheets (in thousands) : September 30, 2019 Derivative Assets Derivative Liabilities Notional Amount Fair Value Notional Amount Fair Value Interest rate swaps $ 525,000 $ 767 $ — $ — Total derivatives, gross 767 — Less: Legally enforceable master netting agreements — — Total derivatives, net $ 767 $ — December 31, 2018 Derivative Assets Derivative Liabilities Notional Amount Fair Value Notional Amount Fair Value Interest rate swaps $ 525,000 $ 6,659 $ — $ — Total derivatives, gross 6,659 — Less: Legally enforceable master netting agreements — — Total derivatives, net $ 6,659 $ — |
Schedule of effect of derivative instruments on the condensed consolidated statements of operations | The following table presents the effect of derivative instruments on the condensed consolidated statements of operations (in thousands) : Three months ended Nine months ended September 30, September 30, 2019 2018 2019 2018 Net investment hedges Foreign exchange forward contracts Gain on derivatives recognized in Accumulated other comprehensive loss $ — $ — $ — $ 970 Derivatives not designated as hedges Interest rate swaps Gain (loss) on derivatives not designated as hedges included in interest expense (868 ) 71 (5,892 ) 4,291 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Schedule of components of expense, discount rate and supplemental cash flow information related to leases | The components of lease expense were as follows (in thousands): Lease cost Classification Three months ended September 30, 2019 Nine months ended September 30, 2019 Operating lease cost Lease expense $ 4,188 $ 12,409 Finance lease cost Amortization of leased assets Depreciation, amortization, and accretion 656 1,753 Interest on lease liabilities Interest expense 4,679 13,832 Lease term and discount rate September 30, 2019 Weighted-average remaining lease term (years) Operating leases 15.4 years Finance leases 33.4 years Weighted-average discount rate (%) Operating leases 12.6 % Finance leases 12.3 % Supplemental cash flow information related to leases was as follows (in thousands): Nine months ended September 30, 2019 Cash paid for amounts included in lease liabilities Operating cash flows related to operating leases $ 11,146 Operating cash flows related to finance leases 12,032 Financing cash flows related to finance leases 430 Leased assets obtained in exchange for new finance lease liabilities 42 Leased assets obtained in exchange for new operating lease liabilities 4,711 |
Schedule of supplemental balance sheet information related to leases | Supplemental balance sheet information related to leases was as follows (in thousands): Classification September 30, 2019 Operating leases Right of use assets Operating lease right-of-use assets $ 62,252 Operating lease liabilities - current portion Accrued liabilities (9,204 ) Operating lease liabilities - long term portion Long-term operating lease liabilities (55,669 ) Finance leases Finance lease assets Property, plant and equipment, net 50,265 Finance lease liabilities - current portion Accrued liabilities (16,578 ) Finance lease liabilities - long term portion Long-term finance lease liabilities (136,556 ) |
Schedule of maturity of operating lease liabilities | As of September 30, 2019 , maturities of lease liabilities were as follows (in thousands): Operating leases Finance leases Total 2019 $ 3,784 $ 4,204 $ 7,988 2020 13,702 16,841 30,543 2021 11,330 16,995 28,325 2022 10,463 17,245 27,708 2023 10,215 17,461 27,676 Thereafter 119,300 669,477 788,777 Total lease payments 168,794 742,223 911,017 Less: imputed interest (103,921 ) (589,089 ) (693,010 ) Present value of lease liabilities $ 64,873 $ 153,134 $ 218,007 |
Schedule of maturity of finance lease liabilities | As of September 30, 2019 , maturities of lease liabilities were as follows (in thousands): Operating leases Finance leases Total 2019 $ 3,784 $ 4,204 $ 7,988 2020 13,702 16,841 30,543 2021 11,330 16,995 28,325 2022 10,463 17,245 27,708 2023 10,215 17,461 27,676 Thereafter 119,300 669,477 788,777 Total lease payments 168,794 742,223 911,017 Less: imputed interest (103,921 ) (589,089 ) (693,010 ) Present value of lease liabilities $ 64,873 $ 153,134 $ 218,007 |
Earnings per share (Tables)
Earnings per share (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of calculations of basic and diluted earnings per share | The calculations of the basic and diluted EPS for the three and nine months ended September 30, 2019 and 2018 are presented below (in thousands, except per share amounts) : For the three months ended September 30, For the nine months ended September 30, 2019 2018 2019 2018 Net income (loss) $ 22,430 $ 5,503 $ 345 $ (7,413 ) Less: Earnings allocated to unvested restricted stock awards 40 25 — — Earnings (loss) allocated to common shareholders $ 22,390 $ 5,478 $ 345 $ (7,413 ) Common stock: Weighted average basic shares outstanding 64,210 63,919 64,119 63,883 Effect of dilutive securities 788 350 409 — Weighted average diluted shares outstanding 64,998 64,269 64,528 63,883 Basic earnings (loss) per share: Net income (loss) $ 0.35 $ 0.09 $ 0.01 $ (0.12 ) Diluted earnings (loss) per share: Net income (loss) $ 0.34 $ 0.09 $ 0.01 $ (0.12 ) |
Segment reporting (Tables)
Segment reporting (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Segment Reporting [Abstract] | |
Schedule of disaggregation of revenue earned from contracts with customers based on reportable segments as well as other financial information attributable to reportable segments | The following tables set forth the disaggregation of revenue earned from contracts with customers based on the Company's reportable segments as well as other financial information attributable to the Company's reportable segments for the three and nine months ended September 30, 2019 and 2018 (in thousands) : For the three months ended September 30, For the nine months ended September 30, 2019 2018 2019 2018 Net sales: Drainage Pipe & Products $ 280,678 $ 242,997 $ 686,092 $ 621,523 Water Pipe & Products 183,848 191,513 480,511 519,031 Corporate and Other — — — 3 Total $ 464,526 $ 434,510 $ 1,166,603 $ 1,140,557 Depreciation and amortization: Drainage Pipe & Products $ 9,317 $ 10,447 $ 27,975 $ 30,898 Water Pipe & Products 14,511 15,218 43,981 47,775 Corporate and Other 344 257 998 697 Total $ 24,172 $ 25,922 $ 72,954 $ 79,370 Segment EBITDA and reconciliation to income (loss) before income taxes: Drainage Pipe & Products $ 67,361 $ 53,271 $ 141,424 $ 122,841 Water Pipe & Products 25,557 17,818 59,271 48,923 Corporate and Other (17,147 ) (14,931 ) (54,195 ) (40,463 ) Less: Interest expense (23,272 ) (21,940 ) (73,720 ) (52,993 ) Depreciation and amortization (24,172 ) (25,922 ) (72,954 ) (79,370 ) Income (loss) before income taxes $ 28,327 $ 8,296 $ (174 ) $ (1,062 ) Capital expenditures: Drainage Pipe & Products $ 3,302 $ 9,397 $ 18,750 $ 18,702 Water Pipe & Products 3,232 3,080 7,757 10,732 Corporate and Other 61 728 2,524 992 Total $ 6,595 $ 13,205 $ 29,031 $ 30,426 September 30, December 31, 2019 2018 Total assets: Drainage Pipe & Products $ 890,239 $ 800,454 Water Pipe & Products 914,884 922,162 Corporate and Other 61,023 70,636 Total $ 1,866,146 $ 1,793,252 The Company has an investment in an equity method investee included in the Drainage Pipe & Products segment for which earnings from equity method investee were $4.0 million , $9.0 million , $2.2 million and $7.7 million for the three and nine months ended September 30, 2019 and September 30, 2018 , respectively, and with the following balances (in thousands) : September 30, December 31, 2019 2018 Investment in equity method investee $ 53,065 $ 50,607 |
Schedule of long-lived assets by geographic areas | Disaggregated revenue by geographic location is provided in the tables below. The Company has operations in the United States, Canada and Mexico. The economic characteristics of the Company's customers does not significantly vary across geographic locations or product lines. The Company has both revenues and long-lived assets in each country; and those assets and revenues are recorded within geographic location as follows (in thousands) : Property, plant, and equipment, net: September 30, December 31, 2019 2018 United States $ 424,595 $ 441,773 Canada 43,126 40,331 Mexico 9,552 10,063 $ 477,273 $ 492,167 |
Schedule of disaggregation of revenue by geographic areas | Net sales: For the three months ended September 30, For the nine months ended September 30, 2019 2018 2019 2018 United States $ 435,706 $ 406,479 $ 1,104,164 $ 1,071,918 Canada 26,458 25,160 56,113 61,046 Mexico 2,362 2,871 6,326 7,593 $ 464,526 $ 434,510 $ 1,166,603 $ 1,140,557 |
Organization and description _2
Organization and description of the business (Details) | Oct. 25, 2016shares |
IPO | Forterra Building Products | |
Recent Transactions | |
Number of shares issued in stock offering (in shares) | 18,420,000 |
Summary of significant accoun_3
Summary of significant accounting policies (Details) - USD ($) $ in Millions | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Jan. 01, 2019 | |
ASU 2016-02 Leases (Topic 842) | ||||
Significant Accounting Policies | ||||
Net lease assets | $ 63.9 | |||
Net lease liabilities | 65.2 | |||
Sale leaseback transaction, carrying value of deferred gains | 9.3 | |||
ASU 2016-02 Leases (Topic 842) | Retained Deficit | ||||
Significant Accounting Policies | ||||
Cumulative effect of accounting changes, net of tax | $ 2.3 | |||
Customer Concentration Risk | Sales Revenue, Net | Customer A | Water Pipe & Products | ||||
Significant Accounting Policies | ||||
Concentration risk, percentage | 14.00% | 14.00% | ||
Customer Concentration Risk | Accounts Receivable | Customer A | Water Pipe & Products | ||||
Significant Accounting Policies | ||||
Concentration risk, percentage | 14.00% | 16.00% |
Acquisitions (Details)
Acquisitions (Details) $ in Millions | Mar. 01, 2019USD ($) |
TEXAS | Buckner | |
Business Acquisition [Line Items] | |
Cash consideration paid for assets acquired | $ 11.8 |
Receivables, net (Details)
Receivables, net (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Receivables, gross | $ 288,926 | $ 200,609 |
Less: Allowance for doubtful accounts | (2,581) | (2,141) |
Receivables, net | 286,345 | 198,468 |
Trade receivables | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Receivables, gross | 262,506 | 188,999 |
Amounts billed but not yet paid under retainage provisions | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Receivables, gross | 2,856 | 2,065 |
Other receivables | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Receivables, gross | $ 23,564 | $ 9,545 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 170,000 | $ 193,603 |
Raw materials | 86,025 | 90,376 |
Work in process | 620 | 1,051 |
Total inventories | $ 256,645 | $ 285,030 |
Investment in equity method i_3
Investment in equity method investee - Additional Information (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Schedule of Equity Method Investments [Line Items] | ||
Investment in equity method investee | $ 53,065 | $ 50,607 |
Drainage Pipe & Products | ||
Schedule of Equity Method Investments [Line Items] | ||
Investment in equity method investee | $ 53,065 | $ 50,607 |
CP&P Joint Venture | Drainage Pipe & Products | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity method investment, ownership percentage | 50.00% | |
Investment in equity method investee | $ 53,100 | |
Company's share of the underlying equity net assets of the investee | $ 13,100 |
Investment in equity method i_4
Investment in equity method investee - Company's Distribution and Earnings in Equity Method Investment (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Schedule of Equity Method Investments [Line Items] | |||||
Distribution received from CP&P | $ (6,500) | $ (8,875) | |||
Share of earnings in CP&P | $ 3,990 | $ 2,224 | 8,959 | $ 7,745 | |
CP&P Joint Venture | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Distribution received from CP&P | (5,000) | (3,875) | (6,500) | $ (8,875) | |
Share of earnings in CP&P | 4,008 | 2,242 | 9,013 | 7,799 | |
Amortization of excess fair value of investment | $ (18) | $ (18) | $ (54) | $ (54) |
Investment in equity method i_5
Investment in equity method investee - Selected Financial Data from the Investee (Details) - CP&P Joint Venture - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Schedule of Equity Method Investments [Line Items] | ||||
Net sales | $ 38,210 | $ 31,864 | $ 103,812 | $ 96,537 |
Gross profit | 12,632 | 9,042 | 32,307 | 28,537 |
Income from operations | 8,021 | 4,540 | 18,041 | 15,235 |
Net income | $ 7,959 | $ 4,479 | $ 17,852 | $ 15,052 |
Property, plant and equipment_3
Property, plant and equipment, net (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Property, Plant and Equipment [Line Items] | |||||
Total property, plant and equipment | $ 666,095 | $ 666,095 | $ 649,110 | ||
Less: accumulated depreciation | (188,822) | (188,822) | (156,943) | ||
Property, plant and equipment, net | 477,273 | 477,273 | 492,167 | ||
Depreciation expense | 12,300 | $ 12,900 | 37,400 | $ 39,900 | |
Machinery and equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property, plant and equipment | 391,957 | 391,957 | 373,881 | ||
Land, buildings and improvements | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property, plant and equipment | 237,465 | 237,465 | 235,819 | ||
Other equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property, plant and equipment | 8,005 | 8,005 | 6,962 | ||
Construction-in-progress | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property, plant and equipment | $ 28,668 | $ 28,668 | $ 32,448 |
Goodwill and other intangible_3
Goodwill and other intangible assets, net - Goodwill by Operating Segment (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Goodwill [Roll Forward] | |
Balance at December 31, 2018 | $ 508,193 |
Foreign currency and other adjustments | 395 |
Balance at September 30, 2019 | 508,588 |
Drainage Pipe & Products | |
Goodwill [Roll Forward] | |
Balance at December 31, 2018 | 189,833 |
Foreign currency and other adjustments | 395 |
Balance at September 30, 2019 | 190,228 |
Water Pipe & Products | |
Goodwill [Roll Forward] | |
Balance at December 31, 2018 | 318,360 |
Foreign currency and other adjustments | 0 |
Balance at September 30, 2019 | $ 318,360 |
Goodwill and other intangible_4
Goodwill and other intangible assets, net - Intangible Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets | $ 154,558 | $ 183,789 |
Customer relationships and contracts | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets | 109,769 | 131,473 |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets | 20,850 | 24,523 |
Patents | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets | 8,581 | 11,304 |
Non-compete agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets | 8,801 | 9,574 |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets | 6,074 | 0 |
In-Process R&D | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets | 0 | 6,354 |
Other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets | $ 483 | $ 561 |
Goodwill and other intangible_5
Goodwill and other intangible assets, net - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Selling, General and Administrative Expenses | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization expense | $ 11.9 | $ 13.1 | $ 35.5 | $ 39.4 |
Fair value measurement - Estima
Fair value measurement - Estimated Carrying Amount and Fair Value of Financial Instruments Measured and Recorded at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Assets: | ||
Derivative asset | $ 767 | $ 6,659 |
Fair Value, Measurements, Recurring | ||
Assets: | ||
Derivative asset | 767 | 6,659 |
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Derivative asset | 0 | 0 |
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Derivative asset | 767 | 6,659 |
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | ||
Assets: | ||
Derivative asset | $ 0 | $ 0 |
Fair value measurement - Carryi
Fair value measurement - Carrying Amount and Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Tax receivable agreement payable | $ 88,775 | $ 88,775 |
Carrying Amount | Senior Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Term Loan | 1,168,533 | 1,188,605 |
Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Tax receivable agreement payable | 55,267 | 51,832 |
Fair Value | Previously Reported | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Tax receivable agreement payable | 82,900 | |
Fair Value | Senior Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Term Loan | 1,129,645 | 1,103,628 |
Fair Value | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Tax receivable agreement payable | 0 | 0 |
Fair Value | Quoted Prices in Active Markets for Identical Assets (Level 1) | Senior Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Term Loan | 0 | 0 |
Fair Value | Significant Other Observable Inputs (Level 2) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Tax receivable agreement payable | 0 | 0 |
Fair Value | Significant Other Observable Inputs (Level 2) | Senior Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Term Loan | 1,129,645 | 1,103,628 |
Fair Value | Significant Unobservable Inputs (Level 3) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Tax receivable agreement payable | 55,267 | 51,832 |
Fair Value | Significant Unobservable Inputs (Level 3) | Senior Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Term Loan | $ 0 | $ 0 |
Accrued liabilities (Details)
Accrued liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Payables and Accruals [Abstract] | ||
Accrued payroll and employee benefits | $ 28,395 | $ 31,095 |
Short-term finance leases | 16,578 | |
Short-term finance leases | 16,430 | |
Short-term operating leases | 9,204 | |
Accrued taxes | 12,228 | 11,489 |
Warranty | 4,509 | 3,251 |
Accrued rebates | 4,090 | 3,542 |
Environmental obligation | 718 | 570 |
Other miscellaneous accrued liabilities | 9,700 | 3,859 |
Total accrued liabilities | $ 85,422 | $ 70,236 |
Debt and deferred financing c_3
Debt and deferred financing costs - Schedule of Debt (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 | Oct. 25, 2016 |
Debt Instrument [Line Items] | |||
Total debt | $ 1,168,533 | $ 1,188,605 | |
Less: current portion debt | (12,510) | (12,510) | |
Total long-term debt | 1,156,023 | 1,176,095 | |
Senior Notes | Term Loan | |||
Debt Instrument [Line Items] | |||
Total debt | 1,168,533 | 1,188,605 | $ 1,050,000 |
Debt issuance costs and original issuance discount | $ 28,442 | $ 34,252 |
Debt and deferred financing c_4
Debt and deferred financing costs - Additional Information (Details) - USD ($) | May 01, 2017 | Oct. 25, 2016 | Sep. 30, 2019 | Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 |
Debt Instrument [Line Items] | ||||||||
Debt outstanding | $ 1,168,533,000 | $ 1,168,533,000 | $ 1,168,533,000 | $ 1,188,605,000 | ||||
Net proceeds from incremental term loan | 54,000,000 | $ 0 | ||||||
Gain on early extinguishment of debt | 374,000 | $ 0 | 374,000 | $ 0 | ||||
Term Loan | LIBOR | ||||||||
Debt Instrument [Line Items] | ||||||||
Margin rate | 3.00% | 3.50% | ||||||
Revolving Line of Credit | Revolver | Revolving Credit Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit facility, maximum borrowing capacity | $ 300,000,000 | |||||||
Line of credit facility, accordion feature, increase limit | 100,000,000 | |||||||
Line of credit facility, maximum borrowing capacity, accordion feature, increase limit | $ 50,000,000 | |||||||
Debt instrument, borrowing base limitation, sum of eligible cash, maximum | 100.00% | |||||||
Debt instrument, borrowing base limitation, eligible accounts receivable, maximum | 85.00% | |||||||
Debt instrument, borrowing base limitation, eligible inventory, maximum | 75.00% | |||||||
Debt instrument, borrowing base limitation, orderly liquidation value of eligible inventory, maximum | 85.00% | |||||||
Debt instrument, borrowing base limitation, eligible accounts receivable and inventory, accordion feature, maximum | 2.50% | |||||||
Outstanding borrowings under revolver | $ 0 | $ 0 | $ 0 | 0 | ||||
Weighted average interest rate on borrowings outstanding | 3.71% | 3.71% | 3.71% | |||||
Stand-by letters of credit outstanding | $ 17,300,000 | $ 17,300,000 | $ 17,300,000 | |||||
Allowable borrowing base | 282,700,000 | 282,700,000 | $ 282,700,000 | |||||
Fixed charge coverage ratio | 1 | |||||||
Revolving Line of Credit | Revolver | Revolving Credit Facility | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit, facility fee percentage | 0.20% | |||||||
Revolving Line of Credit | Revolver | Revolving Credit Facility | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit, facility fee percentage | 0.325% | |||||||
Revolving Line of Credit | Revolver | Revolving Credit Facility | Canada | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit facility, maximum borrowing capacity | $ 20,000,000 | |||||||
Revolving Line of Credit | Revolver | Revolving Credit Facility | United States | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit facility, maximum borrowing capacity | $ 280,000,000 | |||||||
Revolving Line of Credit | Revolver | Revolving Credit Facility | LIBOR or CDOR | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, collateral covenant, percentage of voting stock, maximum | 65.00% | |||||||
Revolving Line of Credit | Revolver | Revolving Credit Facility | LIBOR or CDOR | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Margin rate | 1.25% | |||||||
Revolving Line of Credit | Revolver | Revolving Credit Facility | LIBOR or CDOR | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Margin rate | 1.75% | |||||||
Revolving Line of Credit | Revolver | Revolving Credit Facility | CDOR | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Margin rate | 0.25% | |||||||
Revolving Line of Credit | Revolver | Revolving Credit Facility | CDOR | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Margin rate | 0.75% | |||||||
Revolving Line of Credit | Term Loan | ||||||||
Debt Instrument [Line Items] | ||||||||
Proceeds from term loans, net | $ 200,000,000 | |||||||
Debt instrument, reduction in applicable interest rate percentage | 0.50% | |||||||
Net proceeds from incremental term loan | $ 196,800,000 | |||||||
Senior Notes | Term Loan | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt outstanding | $ 1,050,000,000 | 1,168,533,000 | $ 1,168,533,000 | $ 1,168,533,000 | $ 1,188,605,000 | |||
Debt instrument, amortization percentage | 0.25% | |||||||
Weighted average interest rate | 5.20% | 5.10% | 5.40% | 4.90% | ||||
Aggregate principal amount of outstanding debt repurchased | 16,500,000 | $ 16,500,000 | $ 16,500,000 | |||||
Market value of debt repurchased | 15,700,000 | $ 15,700,000 | $ 15,700,000 | |||||
Write off of debt issuance costs | 400,000 | |||||||
Gain on early extinguishment of debt | $ 400,000 | |||||||
Senior Notes | Term Loan | LIBOR | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, floor percentage | 1.00% | |||||||
Senior Notes | Term Loan | Base Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Margin rate | 2.00% | |||||||
Senior Notes | Term Loan | LIBOR or CDOR | Canada | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, collateral covenant, percentage of voting stock, maximum | 65.00% | |||||||
Senior Notes | Senior Secured Term Loan | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt outstanding | $ 1,050,000,000 | |||||||
Line of credit facility, accordion feature, increase limit | $ 285,000,000 |
Debt and deferred financing c_5
Debt and deferred financing costs - Scheduled Maturities of Long-term Debt (Details) - Term Loan $ in Thousands | Sep. 30, 2019USD ($) |
Debt Instrument [Line Items] | |
2019 | $ 3,128 |
2020 | 12,510 |
2021 | 12,510 |
2022 | 12,510 |
2023 | 1,156,317 |
Total | $ 1,196,975 |
Derivatives and hedging - Addit
Derivatives and hedging - Additional Information (Details) - Interest Rate Swap - USD ($) $ in Thousands | Feb. 09, 2017 | Sep. 30, 2019 | Dec. 31, 2018 |
Derivative [Line Items] | |||
Derivative notional amount | $ 525,000 | $ 525,000 | |
Not Designated as Hedging Instrument | |||
Derivative [Line Items] | |||
Derivative notional amount | $ 525,000 | ||
Derivative, term of contract | 3 years | ||
Not Designated as Hedging Instrument | LIBOR | |||
Derivative [Line Items] | |||
Derivative, fixed Interest rate to pay interest | 1.52% |
Derivatives and hedging - Sched
Derivatives and hedging - Schedule of Fair Values of Derivative Assets and Liabilities in Condensed Consolidated Balance Sheets (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Derivative Assets | ||
Fair Value | $ 767 | $ 6,659 |
Less: Legally enforceable master netting agreements | 0 | 0 |
Total derivatives, net | 767 | 6,659 |
Derivative Liabilities | ||
Fair Value | 0 | 0 |
Less: Legally enforceable master netting agreements | 0 | 0 |
Total derivatives, net | 0 | 0 |
Interest rate swaps | ||
Derivative Assets | ||
Notional Amount | 525,000 | 525,000 |
Fair Value | 767 | 6,659 |
Derivative Liabilities | ||
Notional Amount | 0 | 0 |
Fair Value | $ 0 | $ 0 |
Derivatives and hedging - Sch_2
Derivatives and hedging - Schedule of Effect of Derivative Instruments on Condensed Consolidated Statements of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain on derivatives recognized in Accumulated other comprehensive loss | $ 0 | $ 970 | ||
Net investment hedges | Foreign exchange forward contracts | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain on derivatives recognized in Accumulated other comprehensive loss | $ 0 | 0 | $ 0 | 970 |
Derivatives not designated as hedges | Interest rate swaps | Interest expense | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) on derivatives not designated as hedges included in interest expense | $ (868) | $ 71 | $ (5,892) | $ 4,291 |
Leases - Additional Information
Leases - Additional Information (Details) | Sep. 30, 2019renewal_option |
Lessee, Lease, Description [Line Items] | |
Initial term of finance leases | 25 years |
Number of renewal options of finance leases | 1 |
Renewal term of finance leases | 10 years |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Initial term of operating leases | 1 year |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Initial term of operating leases | 25 years |
Renewal term of operating leases | 10 years |
Leases - Components of Lease Ex
Leases - Components of Lease Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2019 | Sep. 30, 2019 | |
Leases [Abstract] | ||
Operating lease cost | $ 4,188 | $ 12,409 |
Finance lease cost | ||
Amortization of leased assets | 656 | 1,753 |
Interest on lease liabilities | $ 4,679 | $ 13,832 |
Leases - Lease Term and Discoun
Leases - Lease Term and Discount Rate (Details) | Sep. 30, 2019 |
Leases [Abstract] | |
Operating leases, weighted-average remaining lease term | 15 years 4 months 20 days |
Finance leases, weighted-average remaining lease term | 33 years 4 months 24 days |
Operating leases, weighted-average discount rate | 12.60% |
Finance leases, weighted-average discount rate | 12.30% |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Cash paid for amounts included in lease liabilities | |
Operating cash flows related to operating leases | $ 11,146 |
Operating cash flows related to finance leases | 12,032 |
Financing cash flows related to finance leases | 430 |
Leased assets obtained in exchange for new finance lease liabilities | 42 |
Leased assets obtained in exchange for new operating lease liabilities | $ 4,711 |
Leases - Supplemental Balance S
Leases - Supplemental Balance Sheet Information (Details) $ in Thousands | Sep. 30, 2019USD ($) |
Operating leases | |
Right of use assets | $ 62,252 |
Operating lease liabilities - current portion | (9,204) |
Operating lease liabilities - long term portion | (55,669) |
Finance leases | |
Finance lease assets | 50,265 |
Finance lease liabilities - current portion | (16,578) |
Finance lease liabilities - long term portion | $ (136,556) |
Leases - Maturities of Lease Li
Leases - Maturities of Lease Liabilities (Details) $ in Thousands | Sep. 30, 2019USD ($) |
Operating leases | |
2019 | $ 3,784 |
2020 | 13,702 |
2021 | 11,330 |
2022 | 10,463 |
2023 | 10,215 |
Thereafter | 119,300 |
Total lease payments | 168,794 |
Less: imputed interest | (103,921) |
Present value of lease liabilities | 64,873 |
Finance leases | |
2019 | 4,204 |
2020 | 16,841 |
2021 | 16,995 |
2022 | 17,245 |
2023 | 17,461 |
Thereafter | 669,477 |
Total lease payments | 742,223 |
Less: imputed interest | (589,089) |
Present value of lease liabilities | 153,134 |
Total | |
2019 | 7,988 |
2020 | 30,543 |
2021 | 28,325 |
2022 | 27,708 |
2023 | 27,676 |
Thereafter | 788,777 |
Total lease payments | 911,017 |
Less: imputed interest | (693,010) |
Present value of lease liabilities | $ 218,007 |
Commitments and contingencies (
Commitments and contingencies (Details) | Nov. 30, 2018plaintiff | Aug. 14, 2017plaintiff | Oct. 25, 2016 | Oct. 05, 2016USD ($) | Sep. 30, 2019USD ($) | Dec. 31, 2018USD ($) | Jun. 13, 2016USD ($) | Mar. 13, 2015USD ($) |
LTIP | ||||||||
Loss Contingencies [Line Items] | ||||||||
Amount accrued for long-term incentive plan | $ 0 | |||||||
Payments for long-term incentive plan | 0 | |||||||
Lone Star | Affiliated Entities | ||||||||
Loss Contingencies [Line Items] | ||||||||
Certain covered tax benefits paid by related party, percentage | 85.00% | |||||||
Accrued liabilities related to tax receivable agreement | 88,800,000 | $ 88,800,000 | ||||||
Payments of liability related to tax receivable agreement | 0 | |||||||
Heidelberg Cement Hanson Building Products | ||||||||
Loss Contingencies [Line Items] | ||||||||
Business acquisition, possible maximum earn out | $ 100,000,000 | $ 100,000,000 | ||||||
Delaware Action | Pending Litigation | ||||||||
Loss Contingencies [Line Items] | ||||||||
Loss contingency, damages sought | $ 100,000,000 | |||||||
Loss contingency liability | $ 0 | |||||||
Securities Action | ||||||||
Loss Contingencies [Line Items] | ||||||||
Loss contingency, number of plaintiffs | plaintiff | 2 | 4 |
Earnings per share (Details)
Earnings per share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Earnings Per Share [Abstract] | ||||||||
Net income (loss) | $ 22,430 | $ 2,954 | $ (25,039) | $ 5,503 | $ 6,994 | $ (19,910) | $ 345 | $ (7,413) |
Less: Earnings allocated to unvested restricted stock awards | 40 | 25 | 0 | 0 | ||||
Earnings (loss) allocated to common shareholders | $ 22,390 | $ 5,478 | $ 345 | $ (7,413) | ||||
Common stock: | ||||||||
Weighted average basic shares outstanding (in shares) | 64,210 | 63,919 | 64,119 | 63,883 | ||||
Effect of dilutive securities (in shares) | 788 | 350 | 409 | 0 | ||||
Weighted average diluted shares outstanding (in shares) | 64,998 | 64,269 | 64,528 | 63,883 | ||||
Basic earnings (loss) per share: | ||||||||
Net income (loss) (in dollars per share) | $ 0.35 | $ 0.09 | $ 0.01 | $ (0.12) | ||||
Diluted earnings (loss) per share: | ||||||||
Net income (loss) (in dollars per share) | $ 0.34 | $ 0.09 | $ 0.01 | $ (0.12) |
Earnings per share - Additional
Earnings per share - Additional Information (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Stock Options and Restricted Shares | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share (in shares) | 2,015,399 | 3,032,201 | 3,963,041 | 2,559,752 |
Income taxes (Details)
Income taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | ||||
Income tax benefit (expense) | $ (5,897) | $ (2,793) | $ 519 | $ (6,351) |
Increase in valuation allowance for deferred tax assets | $ 3,700 |
Segment reporting (Details)
Segment reporting (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($)geographic_area | Sep. 30, 2018USD ($) | Dec. 31, 2018USD ($) | |
Segment Reporting Information [Line Items] | |||||
Number of geographic areas | geographic_area | 3 | ||||
Net sales | $ 464,526 | $ 434,510 | $ 1,166,603 | $ 1,140,557 | |
Depreciation and amortization | 24,172 | 25,922 | 72,954 | 79,370 | |
Less: Interest expense | (23,272) | (21,940) | (73,720) | (52,993) | |
Income (loss) before income taxes | 28,327 | 8,296 | (174) | (1,062) | |
Capital expenditures | 6,595 | 13,205 | 29,031 | 30,426 | |
Total assets | 1,866,146 | 1,866,146 | $ 1,793,252 | ||
Earnings from equity method investee | 3,990 | 2,224 | 8,959 | 7,745 | |
Investment in equity method investee | 53,065 | 53,065 | 50,607 | ||
Property, plant and equipment, net | 477,273 | 477,273 | 492,167 | ||
United States | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 435,706 | 406,479 | 1,104,164 | 1,071,918 | |
Property, plant and equipment, net | 424,595 | 424,595 | 441,773 | ||
Canada | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 26,458 | 25,160 | 56,113 | 61,046 | |
Property, plant and equipment, net | 43,126 | 43,126 | 40,331 | ||
Mexico | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 2,362 | 2,871 | 6,326 | 7,593 | |
Property, plant and equipment, net | 9,552 | 9,552 | 10,063 | ||
Drainage Pipe & Products | |||||
Segment Reporting Information [Line Items] | |||||
Earnings from equity method investee | 4,000 | 2,200 | 9,000 | 7,700 | |
Investment in equity method investee | 53,065 | 53,065 | 50,607 | ||
Operating Segments | Drainage Pipe & Products | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 280,678 | 242,997 | 686,092 | 621,523 | |
Depreciation and amortization | 9,317 | 10,447 | 27,975 | 30,898 | |
Segment EBITDA and reconciliation to income (loss) before income taxes | 67,361 | 53,271 | 141,424 | 122,841 | |
Capital expenditures | 3,302 | 9,397 | 18,750 | 18,702 | |
Total assets | 890,239 | 890,239 | 800,454 | ||
Operating Segments | Water Pipe & Products | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 183,848 | 191,513 | 480,511 | 519,031 | |
Depreciation and amortization | 14,511 | 15,218 | 43,981 | 47,775 | |
Segment EBITDA and reconciliation to income (loss) before income taxes | 25,557 | 17,818 | 59,271 | 48,923 | |
Capital expenditures | 3,232 | 3,080 | 7,757 | 10,732 | |
Total assets | 914,884 | 914,884 | 922,162 | ||
Corporate and Other | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 0 | 0 | 0 | 3 | |
Depreciation and amortization | 344 | 257 | 998 | 697 | |
Segment EBITDA and reconciliation to income (loss) before income taxes | (17,147) | (14,931) | (54,195) | (40,463) | |
Capital expenditures | 61 | $ 728 | 2,524 | $ 992 | |
Total assets | $ 61,023 | $ 61,023 | $ 70,636 |
Related party transactions (Det
Related party transactions (Details) - Affiliated Entities - USD ($) $ in Millions | Oct. 25, 2016 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 |
CP&P Joint Venture | ||||
Related Party Transaction [Line Items] | ||||
Sales of products to related party | $ 0.3 | $ 0.1 | ||
Purchased goods and services from related party | $ 0.2 | $ 0.1 | ||
Bricks Joint Venture | Transition Service Agreement | ||||
Related Party Transaction [Line Items] | ||||
Net receivable from affiliates | $ 4.4 | |||
Lone Star | ||||
Related Party Transaction [Line Items] | ||||
Payment of certain covered tax benefits buy the Company, percentage | 85.00% |
Uncategorized Items - frta-2019
Label | Element | Value |
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 6,957,000 |
Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 6,957,000 |