| BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES For a discussion of trends that we believe have affected our business during the periods covered by these financial statements, see Part I, Item 2. "Management's Discussion and Analysis of Financial Condition and Results of Operations", including the "Highlights," "Consolidated Results of Operations" and "Liquidity and Capital Resources", below, and Part I, Item 1A. "Risk Factors" of our Annual Report on Form 10-K, filed with the United States Securities and Exchange Commission ("SEC") on February 29, 2024 (the "2023 Annual Report"). Description of Business The Company is a leading, technology-enabled, omni-channel provider of lease-to-own ("LTO") and retail purchase solutions of furniture, electronics, appliances, and other home goods across its brands: Aaron's, BrandsMart U.S.A., BrandsMart Leasing, and Woodhaven Furniture Industries ("Woodhaven"). As of June 30, 2024, the Company's operating and reportable segments are the Aaron's Business and BrandsMart, each as described below. The Aaron's Business segment is comprised of (i) Aaron's branded Company-operated and franchise operated stores; (ii) aarons.com e-commerce platform ("aarons.com"); (iii) Woodhaven; and (iv) BrandsMart Leasing (collectively, the "Aaron's Business"). The operations of BrandsMart U.S.A. (excluding BrandsMart Leasing) comprise the BrandsMart segment (collectively, "BrandsMart"). Aaron's Business Segment Since its founding in 1955, Aaron's has been committed to serving the overlooked and underserved customer with a dedication to inclusion and improving the communities in which it operates. Through a portfolio of approximately 1,210 stores and its aarons.com e-commerce platform, Aaron's, together with its franchisees, provide consumers with LTO and retail purchase solutions for the products they need and want, with a focus on providing its customers with unparalleled customer service, high approval rates, lease plan flexibility, and an attractive value proposition, including competitive monthly payments and total cost of ownership, as compared to other LTO providers. Woodhaven manufactures and supplies a significant portion of the upholstered furniture leased and sold in Company-operated and franchised Aaron's stores. Launched in 2022, BrandsMart Leasing offers LTO purchase solutions to customers of BrandsMart U.S.A. BrandsMart Segment Founded in 1977, BrandsMart U.S.A. is one of the leading appliance and consumer electronics retailers in the southeast United States and one of the largest appliance retailers in the country with 12 stores in Florida and Georgia and a growing e-commerce presence on brandsmartusa.com. The operations of BrandsMart U.S.A. (other than BrandsMart Leasing) comprise the BrandsMart segment. Basis of Presentation The accompanying condensed consolidated financial statements of the Company and its wholly-owned subsidiaries for the three and six months ended June 30, 2024 and comparable prior year period reflect the historical results of operations, financial position and cash flows of the Company in accordance with accounting principles generally accepted in the United States ("U.S. GAAP"). Intercompany balances and transactions between consolidated entities have been eliminated and reflect the historical results of operations, financial position and cash flows of the Company in accordance with accounting principles generally accepted in the United States ("U.S. GAAP"). The accompanying unaudited condensed consolidated financial statements do not include all information required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included in the accompanying unaudited condensed consolidated financial statements. These financial statements should be read in conjunction with the financial statements and notes thereto included in the 2023 Annual Report. The results of operations for the three and six months ended June 30, 2024 are not necessarily indicative of operating results that may be achieved for any other interim period or for the full year. Agreement and Plan of Merger with IQVentures On June 16, 2024, The Aaron's Company, Inc., a Georgia corporation (the "Company"), entered into an Agreement and Plan of Merger (the "Merger Agreement") with IQVentures Holdings, LLC, an Ohio limited liability company ("Parent" or "IQVentures"), and Polo Merger Sub, Inc., a newly formed Georgia corporation and a wholly owned subsidiary of Parent ("Merger Sub"). The Merger Agreement provides for the acquisition of the Company by Parent by means of a merger of Merger Sub with and into the Company (the "Merger"), with the Company surviving the Merger as a wholly owned subsidiary of Parent. At the time the Merger becomes effective (the "Effective Time"), each share of the Company's common stock, par value $0.50 per share issued and outstanding immediately prior to the Effective Time (other than dissenting shares, treasury shares and shares owned by Parent or any direct or indirect wholly owned subsidiary of Parent), will be converted automatically into the right to receive $10.10 in cash, without interest. The Company's Board of Directors has approved the Merger Agreement, but completion of the Merger is subject to certain other customary conditions, including approval by the Company's shareholders. The Merger Agreement contains customary termination rights for the Company and Parent, including the payment of termination fees under specified circumstances. The Merger Agreement also contains customary representations, warranties and covenants of the Company, including covenants to conduct its business in the ordinary course during the interim period between the execution of the Merger Agreement and the consummation of the Merger and not to engage in certain types of transactions during this interim period without the prior written consent of Parent. The consummation of the Merger is not subject to any financing condition. Under the terms of the Merger Agreement, the Company is permitted to continue to pay its regular quarterly dividend, not in excess of $0.125 per share. For further information on the Merger and the Merger Agreement, refer to the Company's Form 8-K filed with the SEC on June 17, 2024. Other than transaction-related expenses associated with the proposed Merger of $7.5 million for the three and six months ended June 30, 2024, which are included within acquisition-related costs in the condensed consolidated statements of (loss) earnings, the terms of the Merger Agreement did not impact the Company's consolidated financial statements. Accounting Policies and Estimates See Note 1 to the consolidated financial statements in the 2023 Annual Report for an expanded discussion of accounting policies and estimates. Acquisition-Related Costs Prior to the three months ended June 30, 2024, acquisition-related costs had been comprised of costs associated with the acquisition of BrandsMart U.S.A in April 2022. The Company began incurring acquisition-related costs related to the planned merger with IQVentures during the three months ended June 30, 2024. For the three and six months ended June 30, 2024, the Company incurred acquisition-related costs associated with the acquisition of BrandsMart U.S.A. of $0.5 million and $1.4 million, which were primarily comprised of consulting, legal expenses, and retention bonuses. For the three months ended June 30, 2024, the Company incurred $7.5 million in acquisition-related costs comprised primarily of advisory and legal fees related to the merger with IQVentures. (Loss) Earnings Per Share (Loss) earnings per share is computed by dividing net (loss) earnings by the weighted average number of shares of common stock outstanding during the period. The computation of (loss) earnings per share assuming dilution includes the dilutive effect of stock options, RSUs, RSAs, PSUs and other awards issuable under the Company's Employee Stock Purchase Program (collectively, "share-based awards") as determined under the treasury stock method, unless the inclusion of such awards would be anti-dilutive. The following table shows the calculation of weighted-average shares outstanding assuming dilution: Three Months Ended Six Months Ended (Shares In Thousands) 2024 2023 2024 2023 Weighted Average Shares Outstanding 30,785 30,993 30,669 30,894 Dilutive Effect of Share-Based Awards 1 — 314 — 380 Weighted Average Shares Outstanding Assuming Dilution 30,785 31,307 30,669 31,274 1 There was no dilutive effect of share-based awards for the three and six months ended June 30, 2024 due to the net loss incurred in those periods. Approximately 1.2 million weighted-average share-based awards were excluded from the computation of earnings per share assuming dilution during the three and six months ended June 30, 2023, as the awards would have been anti-dilutive for the period. Revenue Recognition The Company provides lease and retail merchandise, consisting of appliances, electronics, furniture, and other home goods to its customers for lease under certain terms agreed to by the customer and through retail sales. The Company's Aaron's stores, aarons.com e-commerce platform, and BrandsMart Leasing components of the Aaron's Business segment offer lease agreements that grant customers an option to purchase the leased merchandise by either renewing the lease agreement a specified number of times, 12, 18 or 24 times, for up to 30 days each time, or by exercising an early purchase option. The Aaron's Business segment also earns revenue from the sale of merchandise to customers and Aaron's franchisees, and earns ongoing revenue from Aaron's franchisees in the form of royalties and through advertising efforts that benefit the franchisees. The Company's BrandsMart U.S.A. stores and related brandsmartusa.com e-commerce platform offer the sale of merchandise directly to its customers via retail sales. See Note 4 to these condensed consolidated financial statements for further information regarding the Company's revenue recognition policies and disclosures. Advertising The Company expenses advertising costs as incurred. Advertising production costs are initially recognized as a prepaid advertising asset and are expensed when an advertisement appears for the first time. The prepaid advertising asset was $0.2 million and $0.1 million at June 30, 2024 and December 31, 2023, respectively, and is reported within prepaid expenses and other assets on the condensed consolidated balance sheets. Total advertising costs are classified within other operating expenses, net in the condensed consolidated statements of (loss) earnings. These advertising costs are presented net of cooperative advertising considerations received from vendors, which represents reimbursement of specific, identifiable and incremental costs incurred in selling those vendors' products, and are recorded as a reduction of advertising costs. The following table shows total advertising costs, net of cooperative advertising consideration: Three Months Ended Six Months Ended (In Thousands) 2024 2023 2024 2023 Advertising Costs, Gross $ 19,866 $ 15,269 $ 47,551 $ 35,682 Less: Cooperative Advertising Considerations (8,101) (8,656) (17,000) (16,115) Advertising Costs, Net $ 11,765 $ 6,613 $ 30,551 $ 19,567 Accounts Receivable Accounts receivable consist of receivables due from customers on lease agreements, corporate receivables incurred during the normal course of business (primarily for vendor consideration and third-party warranty providers), and franchisee obligations. Accounts receivable, net of allowances, consist of the following: (In Thousands) June 30, 2024 December 31, 2023 Customers $ 9,800 $ 8,737 Corporate 17,395 23,660 Franchisee 7,855 7,385 $ 35,050 $ 39,782 The Company maintains an accounts receivable allowance for the Aaron's Business customer lease agreements, under which its policy is to record a provision for returns and uncollectible contractually due renewal payments based on historical payments experience, which is recognized as a reduction of lease revenues and fees within the condensed consolidated statements of (loss) earnings. Other qualitative factors are considered in estimating the allowance, such as current and forecasted business trends. The Company writes off customer lease receivables for its Aaron's Business operations that are 60 days or more past due on pre-determined dates twice monthly. The Company writes off customer lease receivables for its BrandsMart Leasing operations that are 90 days or more past due on pre-determined dates twice monthly. The Company also maintains an allowance for outstanding franchisee accounts receivable. The Company's policy is to estimate future losses related to certain franchisees that are deemed to have a higher risk of non-payment and record an allowance for these estimated losses. The estimated allowance on franchisee accounts receivable includes consideration of the financial position of each franchisee and qualitative consideration of potential losses associated with uncertainties impacting the franchisee's ability to satisfy their obligations. Uncertainties include inflationary and other economic pressures in the current macroeconomic environment. Accordingly, actual accounts receivable write-offs could differ from the allowance. The provision for uncollectible franchisee accounts receivable is recorded as bad debt expense in other operating expenses, net within the condensed consolidated statements of (loss) earnings. The allowance related to corporate receivables is not significant as of June 30, 2024 and December 31, 2023. The following table shows the components of the accounts receivable allowance: Six Months Ended (In Thousands) 2024 2023 Beginning Balance $ 9,029 $ 8,895 Accounts Written Off, net of Recoveries (20,168) (22,108) Accounts Receivable Provision 20,342 21,111 Ending Balance $ 9,203 $ 7,898 The following table shows the components of the accounts receivable provision, which includes amounts recognized for bad debt expense and the provision for returns and uncollected payments: Six Months Ended (In Thousands) 2024 2023 Bad Debt (Reversal) Expense $ (117) $ 25 Provision for Returns and Uncollectible Renewal Payments 20,459 21,086 Accounts Receivable Provision $ 20,342 $ 21,111 Lease Merchandise The Company's lease merchandise is recorded at the lower of depreciated cost, including overhead costs from our distribution centers, or net realizable value. The cost of merchandise manufactured by our Woodhaven operations is recorded at cost and includes overhead from production facilities, shipping costs and warehousing costs. The Company begins depreciating furniture and appliances at the earlier of the lease date or 24 months and one day from its purchase, while all other lease merchandise begins depreciating at the earlier of the lease date or 12 months and one day from its purchase. Lease merchandise fully depreciates over the lease agreement period when on lease, generally 12 to 24 months, and generally 36 months when not on lease. Depreciation is accelerated upon early payout. The following is a summary of lease merchandise, net of accumulated depreciation and allowances: (In Thousands) June 30, 2024 December 31, 2023 Merchandise on Lease, net of Accumulated Depreciation and Allowances $ 412,016 $ 419,531 Merchandise Not on Lease, net of Accumulated Depreciation and Allowances 1 210,629 202,731 Lease Merchandise, net of Accumulated Depreciation and Allowances $ 622,645 $ 622,262 1 Includes Woodhaven's inventory, which is primarily comprised of raw materials, that has been classified within lease merchandise in the condensed consolidated balance sheets of $12.6 million and $8.7 million as of June 30, 2024 and December 31, 2023, respectively. The Aaron's store-based operations' policies require weekly merchandise counts at its store-based operations, which include write-offs for unsalable, damaged, or missing merchandise inventories. Monthly cycle counting procedures are performed at both the Aaron's distribution centers and Woodhaven manufacturing facilities. Physical inventories are also taken at the manufacturing facilities annually. The Company also monitors merchandise levels and mix by division, store, and distribution center, as well as the average age of merchandise on hand. If obsolete merchandise cannot be returned to vendors, its carrying amount is adjusted to its net realizable value or written off. Generally, all merchandise not on lease is available for lease or sale. On a monthly basis, all damaged, lost or unsalable merchandise identified is written off and is included as a component of the provision for lease merchandise write-offs in the accompanying condensed consolidated statements of (loss) earnings. The Company records a provision for write-offs using the allowance method, which is included within lease merchandise, net within the condensed consolidated balance sheets. The allowance method for lease merchandise write-offs estimates the merchandise losses incurred but not yet identified by management as of the end of the accounting period based primarily on historical write-off experience. Other qualitative factors are considered in estimating the allowance, such as seasonality and the impacts of uncertainty surrounding inflationary and other economic pressures in the current macroeconomic environment. Therefore, actual lease merchandise write-offs could differ from the allowance. The provision for write-offs is included in provision for lease merchandise write-offs in the accompanying condensed consolidated statements of (loss) earnings. The Company writes off lease merchandise on lease agreements that are 60 days or more past due on pre-determined dates twice monthly. The Company writes off lease merchandise on lease agreements for its BrandsMart Leasing operations that are 90 days or more past due on pre-determined dates twice monthly. The following table shows the components of the allowance for lease merchandise write-offs: Six Months Ended (In Thousands) 2024 2023 Beginning Balance $ 12,912 $ 13,894 Merchandise Written off, net of Recoveries (41,257) (39,181) Provision for Write-offs 41,072 39,161 Ending Balance $ 12,727 $ 13,874 Merchandise Inventories The Company's merchandise inventories are stated at the lower of weighted average cost or net realizable value and consist entirely of merchandise held for sale by the BrandsMart segment. In-bound freight-related costs from vendors, net of allowances and vendor rebates, are included as part of the net cost of merchandise inventories. Costs associated with storing and transporting merchandise inventories to our retail stores are expensed as incurred and included within retail cost of sales in the condensed consolidated statements of (loss) earnings. The Company periodically evaluates aged and distressed inventory and establishes an inventory markdown which represents the excess of the carrying value over the amount the Company expects to realize from the ultimate sale of the inventory. Markdowns establish a new cost basis for the inventory and are recorded within retail cost of sales within the condensed consolidated statement of (loss) earnings. The write-offs of merchandise inventories associated with the Company's cycle and physical inventory count processes are also included within retail cost of sales in the condensed consolidated statement of (loss) earnings. The Company records an inventory reserve for the anticipated loss associated with selling inventories below cost. This reserve is based on management's current knowledge with respect to inventory levels, sales trends, and historical experience selling or disposing of aged or obsolete inventory. The following is a summary of merchandise inventories, net of allowances: (In Thousands) June 30, 2024 December 31, 2023 Merchandise Inventories, gross $ 89,884 $ 91,093 Reserve for Merchandise Inventories (1,367) (921) Merchandise Inventories, net $ 88,517 $ 90,172 The following table shows the components of the reserve for merchandise inventories: Six Months Ended (In Thousands) 2024 2023 Beginning Balance $ 921 $ 981 Merchandise Written off (102) — Provision for Write-offs 548 (60) Ending Balance $ 1,367 $ 921 Prepaid Expenses and Other Assets Prepaid expenses and other assets consist of the following: (In Thousands) June 30, 2024 December 31, 2023 Prepaid Expenses $ 14,513 $ 14,482 Insurance Related Assets 37,381 33,035 Company-Owned Life Insurance 16,102 15,231 Deferred Tax Assets 26,138 24,137 Other Assets 1,2 18,727 18,512 $ 112,861 $ 105,397 1 Amounts as of June 30, 2024 and December 31, 2023 included restricted cash of $1.6 million held as collateral for BrandsMart U.S.A.'s workers' compensation and general liability insurance policies. 2 Amounts included $1.9 million and $0.9 million as of June 30, 2024 and December 31, 2023, respectively, of certain properties classified as held for sale. Assets held for sale are recorded at the lower of their carrying value or fair value less estimated cost to sell and are classified within prepaid expenses and other assets in the consolidated balance sheets. Depreciation is suspended on assets upon classification as held for sale. The highest and best use of these assets is as real estate land parcels for development or real estate properties for use or lease, though the Company has chosen not to develop or use these properties, and plans to sell them to third parties as quickly as practicable. Sale-Leaseback Transactions During the six months ended June 30, 2024, the Company entered into two sale and leaseback transactions related to four Company-owned Aaron's store properties. Net proceeds from the sales were $5.4 million, all of which was received during the six months ended June 30, 2024. Such proceeds are presented within proceeds from dispositions of property, plant and equipment in the condensed consolidated statements of cash flows. The Company recognized a gain of $3.3 million associated with these transactions during the six months ended June 30, 2024, which was classified within other operating expenses, net in the condensed consolidated statements of (loss) earnings. Interest Rate Swap In March 2023, the Company entered into a non-speculative interest rate swap agreement for an aggregate notional amount of $100.0 million with an effective date of April 28, 2023 and a termination date of March 31, 2027. The purpose of this hedge is to limit the Company's exposure of its variable interest rate debt by effectively converting it to fixed interest rate debt. Under the terms of the agreement, the Company will receive a floating interest rate based on 1-month Chicago Mercantile Exchange ("CME") Term Secured Overnight Financing Rate ("SOFR") and pay a fixed interest rate of 3.87% on the notional amount. The interest rate swap is designated as a cash flow hedge. Changes in the fair value of the interest rate swap are recorded quarterly, net of income tax, and included as a component of accumulated other comprehensive loss in the Company's condensed consolidated balance sheets. During the three and six months ended June 30, 2024, the Company reclassified $0.4 million and $0.7 million of net gains from accumulated other comprehensive loss to interest expense compared to $0.2 million of net gains reclassified from accumulated other comprehensive loss to interest expense in the same period of the prior year. See Note 2 to these condensed consolidated financial statements for further information regarding the fair value determination of the Company's interest rate swap agreement. Accounts Payable and Accrued Expenses Accounts payable and accrued expenses consist of the following: (In Thousands) June 30, 2024 December 31, 2023 Accounts Payable $ 114,293 $ 134,191 Estimated Claims Liability Costs 64,527 64,082 Accrued Salaries and Benefits 39,411 39,058 Accrued Real Estate and Sales Taxes 18,814 20,146 Other Accrued Expenses and Liabilities 36,185 34,698 $ 273,230 $ 292,175 Estimated Claims Liability Costs Estimated claims liability costs are accrued primarily for workers compensation and vehicle liability at the Aaron's Business segment, as well as general liability and group health insurance benefits provided to team members. These liabilities are recorded within estimated claims liability costs within accounts payable and accrued expenses in the condensed consolidated balance sheets. Estimates for these claims liabilities are made based on actual reported but unpaid claims and actuarial analysis of the projected claims run off for both reported and incurred but not reported claims. This analysis is based upon an assessment of the likely outcome or historical experience and considers a variety of factors, including the actuarial loss forecasts, company-specific development factors, general industry loss development factors and third-party claim administrator loss estimates of individual claims. The Company makes periodic prepayments to its insurance carriers to cover the projected claims run off for both reported and incurred but not reported claims, considering its retention or stop loss limits. In addition, we have prefunding balances on deposit and other insurance receivables with the insurance carriers which are recorded within prepaid expenses and other assets in our condensed consolidated balance sheets. Goodwill Goodwill represents the excess of the purchase price paid over the fair value of the identifiable net tangible and intangible assets acquired in connection with business acquisitions. BrandsMart and BrandsMart Leasing are the only reporting units with goodwill as of June 30, 2024 and December 31, 2023. Impairment occurs when the reporting unit's carrying value exceeds its fair value. The Company's goodwill is not amortized but is subject to an impairment test at the reporting unit level annually as of October 1 and more frequently if events or circumstances indicate that an impairment may have occurred. Such events or circumstances include a sustained decline in the Company's stock price, prolonged negative industry or economic trends and significant underperformance relative to historical results, projected future operating results, or the Company failing to successfully execute on one or more elements of Company's strategic plans. We may be required to recognize material impairments to the BrandsMart or BrandsMart Leasing goodwill balances in the future if: (i) we fail to successfully execute on one or more elements of the BrandsMart strategic plan; (ii) actual results are unfavorable to our estimates and assumptions used to calculate fair value; (iii) the BrandsMart or BrandsMart Leasing carrying values increase without an associated increase in fair value; and/or (iv) BrandsMart or BrandsMart Leasing is materially impacted by further deterioration of macroeconomic conditions, including inflation and rising interest rates. The Company completed its annual goodwill impairment test for BrandsMart and BrandsMart Leasing as of October 1, 2023, and concluded that no impairment had occurred. The Company determined that there were no events or circumstances that occurred during the three months ended June 30, 2024, that would more likely than not reduce the fair value of BrandsMart or BrandsMart Leasing below their carrying amounts, Goodwill allocated to the BrandsMart and BrandsMart Leasing reporting units on June 30, 2024 and December 31, 2023 was $29.2 million and $26.5 million, respectively. Stockholders' Equity Changes in stockholders' equity for the three and six months ended June 30, 2024 and 2023 are as follows: Treasury Stock Common Stock Additional Retained Earnings Accumulated Other Comprehensive Loss Total Shareholders' Equity (In Thousands, Except Per Share) Shares Amount Shares Amount Balance, December 31, 2023 (6,295) $ (147,788) 36,657 $ 18,328 $ 750,751 $ 66,202 $ (1,355) $ 686,138 Cash Dividends, $0.125 per share — — — — — (3,929) — (3,929) Stock-Based Compensation — — — — 2,721 — — 2,721 Issuance of Shares under Equity Plans (174) (1,250) 438 219 (219) — — (1,250) Net Loss — — — — — (14,181) — (14,181) Unrealized Gain on Derivative Instruments, net of Tax — — — — — — 1,155 1,155 Foreign Currency Translation Adjustment, net of tax — — — — — — (118) (118) Balance, March 31, 2024 (6,469) $ (149,038) 37,095 $ 18,547 $ 753,253 $ 48,092 $ (318) $ 670,536 Cash Dividends, $0.125 per share — — — — — (3,937) — (3,937) Stock-Based Compensation — — — — 2,679 — — 2,679 Issuance of Shares under Equity Plans (8) (73) 94 48 275 — — 250 Net Loss — — — — — (11,903) — (11,903) Unrealized Gain on Derivative Instruments, net of Tax — — — — — — 137 137 Foreign Currency Translation Adjustment, net of tax — — — — — — (76) (76) Balance, June 30, 2024 (6,477) $ (149,111) 37,189 $ 18,595 $ 756,207 $ 32,252 $ (257) $ 657,686 Treasury Stock Common Stock Additional Retained Earnings Accumulated Other Comprehensive Loss Total Shareholders' Equity (In Thousands, Except Per Share) Shares Amount Shares Amount Balance, December 31, 2022 (5,480) $ (138,753) 36,100 $ 18,050 $ 738,428 $ 79,073 $ (1,396) $ 695,402 Cash Dividends, $0.125 per share — — — — — (3,966) — (3,966) Stock-Based Compensation — — — — 2,874 — — 2,874 Issuance of Shares Under Equity Plans (207) (2,539) 496 248 (248) — — (2,539) Net Earnings — — — — — 12,798 — 12,798 Unrealized Loss on Derivative Instruments, net of tax — — — — — — (990) (990) Foreign Currency Translation Adjustment — — — — — — 324 324 Balance, March 31, 2023 (5,687) $ (141,292) 36,596 $ 18,298 $ 741,054 $ 87,905 $ (2,062) $ 703,903 Cash Dividends, $0.125 per share — — — — — (3,874) — (3,874) Stock-Based Compensation — — — — 2,913 — — 2,913 Issuance of Shares Under Equity Plans — — 24 12 48 — — 60 Acquisition of Treasury Stock (66) (804) — — — — — (804) Net Earnings — — — — — 6,517 6,517 Unrealized Gain on Derivative Instruments, net of Tax — — — — — — 1,685 1,685 Foreign Currency Translation Adjustment, net of Tax — — — — — — 180 180 Balance, June 30, 2023 (5,753) $ (142,096) 36,620 $ 18,310 $ 744,015 $ 90,548 $ (197) $ 710,580 Fair Value Measurement Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. To increase the comparability of fair value measures, the following hierarchy prioritizes the inputs to valuation methodologies used to measure fair value: Level 1—Valuations based on quoted prices for identical assets and liabilities in active markets. Level 2—Valuations based on observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data. Level 3—Valuations based on unobservable inputs reflecting the Company's own assumptions, consistent with reasonably available assumptions made by other market participants. These valuations require significant judgment. The fair values of the Company's assets and liabilities as of June 30, 2024 and December 31, 2023 are further described in Note 2 to these condensed consolidated financial statements. Accumulated Other Comprehensive Loss Changes in accumulated other comprehensive loss by component for the six months ended June 30, 2024 and June 30, 2023 are summarized below: Six Months Ended June 30, 2024 (In Thousands) Derivative Instruments Foreign Currency Total Balance at December 31, 2023 $ (442) $ (913) $ (1,355) Other Comprehensive Income (Loss), net of Tax 1,292 (194) 1,098 Balance at June 30, 2024 $ 850 $ (1,107) $ (257) Six Months Ended June 30, 2023 (In Thousands) Derivative Instruments Foreign Currency Total Balance at December 31, 2022 $ (17) $ (1,379) $ (1,396) Other Comprehensive Income, net of Tax 695 504 1,199 Balance at June 30, 2023 $ 678 $ (875) $ (197) Recent Accounting Pronouncements Effective in Future Periods In October 2023, the Financial Accounting Standards Board ("FASB") issued an accounting pronouncement (ASU 2023-06) related to disclosure or presentation requirements for various subtopics in the FASB’s Accounting Standards Codification ("Codification"). The amendments in the update are intended to align the requirements in the Codification with the U.S. Securities and Exchange Commission's ("SEC") regulations and facilitate the application of GAAP for all entities. The effective date for each amendment is the date on whic |
