UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


(Mark One)
☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September 30, 2022~~March 31, 2023


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File ~~Number~~Number: 000-22462

GIBRALTAR INDUSTRIES, INC.

(Exact name of ~~Registrant~~registrant as specified in its charter)

Delaware

16-1445150

(State or Other Jurisdiction of Incorporation or Organization)

(I.R.S. Employer Identification No.)

3556 Lake Shore Road

P.O. Box 2028

Buffalo

New York

14219-0228

(Address of principal executive offices)

(Zip Code)

(716) 826-6500

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol

Name of each exchange on which registered

Common Stock, $0.01 par value per share

ROCK

NASDAQ Stock Market

Indicate by check mark whether the ~~Registrant~~registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the ~~Registrant~~registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the ~~Registrant~~registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicated by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of ~~November 2, 2022,~~May 1, 2023, the number of common shares outstanding was: ~~30,970,972.~~30,410,872.

Table of Contents

GIBRALTAR INDUSTRIES, INC.

INDEX


		PAGE NUMBER
PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements
	Consolidated Statements of Income for the Three ~~and~~ ~~Nine~~Months Ended ~~Sep~~March 31 ~~tember~~ , 202 ~~30, 2022~~3 and ~~2021~~202 2 (unaudited)	3
	Consolidated Statements of Comprehensive Income for the Three ~~andNine~~Months Ended ~~Sept~~March 31 ~~ember~~, 202 3 ~~30, 2022~~ and ~~2021~~202 2 (unaudited)	4
	Consolidated Balance Sheets as of ~~September~~ M ~~30, 2022~~arch 31 , 202 3 (unaudited) and December 31, ~~2021~~202 2	5
	Consolidated Statements of Cash Flows for the Three ~~Nine~~ Months Ended ~~September~~March 31 , 202 3 ~~30, 2022~~ and ~~2021~~202 2 (unaudited)	6
	Consolidated Statement of Stockholders’ Equity for the ~~Nine~~Three Months Ended ~~Sept~~March 31 ~~ember~~, 202 3 ~~30, 2022~~ and ~~2021~~202 2 (unaudited)	7
	Notes to Consolidated Financial Statements (unaudited)	98
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2317
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	3424
Item 4.	Controls and Procedures	3424
PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	3525
Item 1A.	Risk Factors	3525
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	3626
Item 3.	Defaults Upon Senior Securities	3626
Item 4.	Mine Safety Disclosures	3626
Item 5.	Other Information	3626
Item 6.	Exhibits	3727
	SIGNATURES	3828

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

GIBRALTAR INDUSTRIES, INC.

CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except per share data)

(unaudited)

Three Months Ended
September 30, Nine Months Ended
September 30,
2022 2021 2022 2021
Net sales $ 391,291 $ 369,353 $ 1,076,105 $ 1,005,334
Cost of sales 296,735 286,101 826,434 781,133
Gross profit 94,556 83,252 249,671 224,201
Selling, general, and administrative expense 47,160 45,274 140,941 141,999
Income from operations 47,396 37,978 108,730 82,202
Interest expense 1,048 491 2,189 1,180
Other expense (income) 363 72 797 (4,279)
Income before taxes 45,985 37,415 105,744 85,301
Provision for income taxes 11,690 9,561 26,686 20,578
Income from continuing operations 34,295 27,854 79,058 64,723
Discontinued operations:
(Loss) income before taxes — (201) — 1,867
Provision for income taxes — 97 — 323
(Loss) income from discontinued operations — (298) — 1,544
Net income $ 34,295 $ 27,556 $ 79,058 $ 66,267
Net earnings per share – Basic:
Income from continuing operations $ 1.08 $ 0.85 $ 2.44 $ 1.97
(Loss) income from discontinued operations — (0.01) — 0.05
Net income $ 1.08 $ 0.84 $ 2.44 $ 2.02
Weighted average shares outstanding – Basic 31,707 32,802 32,396 32,791
Net earnings per share – Diluted:
Income from continuing operations $ 1.08 $ 0.84 $ 2.43 $ 1.96
(Loss) income from discontinued operations — (0.01) — 0.05
Net income $ 1.08 $ 0.83 $ 2.43 $ 2.01
Weighted average shares outstanding – Diluted 31,812 33,050 32,503 33,055


	Three Months Ended March 31,
	2023		2022
Net sales	$	293,267	$	317,865
Cost of sales	216,338		253,021
Gross profit	76,929		64,844
Selling, general, and administrative expense	47,559		43,649

Income from operations	29,370		21,195
Interest expense	1,491		485
Other (income) expense	(397)		153
Income before taxes	28,276		20,557
Provision for income taxes	7,177		5,101





Net income	$	21,099	$	15,456











Net earnings per share:
Basic	$	0.68	$	0.47
Diluted	$	0.68	$	0.47
Weighted average shares outstanding:
Basic	30,897		32,913
Diluted	31,024		33,022

See accompanying notes to consolidated financial statements.

Table of Contents

GIBRALTAR INDUSTRIES, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in thousands)

(unaudited)


		Three Months Ended September 30,				Nine Months Ended September 30,					Three Months Ended March 31,
		2022		2021		2022		2021			2023		2022
Net income	Net income	$	34,295	$	27,556	$	79,058	$	66,267	Net income	$	21,099	$	15,456
Other comprehensive (loss) income:	Other comprehensive (loss) income:									Other comprehensive (loss) income:
Foreign currency translation adjustment	Foreign currency translation adjustment	(3,568)		(1,057)		(6,993)		2,902		Foreign currency translation adjustment	(115)		(227)

Minimum post retirement benefit plan adjustments, net of tax	Minimum post retirement benefit plan adjustments, net of tax	12		27		37		81		Minimum post retirement benefit plan adjustments, net of tax	8		24

Other comprehensive (loss) income		(3,556)		(1,030)		(6,956)		2,983
Other comprehensive loss										Other comprehensive loss	(107)		(203)
Total comprehensive income	Total comprehensive income	$	30,739	$	26,526	$	72,102	$	69,250	Total comprehensive income	$	20,992	$	15,253

See accompanying notes to consolidated financial statements.

Table of Contents

GIBRALTAR INDUSTRIES, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except per share data)


		September 30, 2022		December 31, 2021			March 31, 2023		December 31, 2022
		(unaudited)					(unaudited)
Assets	Assets					Assets
Current assets:	Current assets:					Current assets:
Cash and cash equivalents	Cash and cash equivalents	$	21,919	$	12,849	Cash and cash equivalents	$	7,497	$	17,608
Accounts receivable, net of allowance of $3,847 and $3,738, respectively		275,704		236,444
Accounts receivable, net of allowance of $4,164 and $3,746, respectively						Accounts receivable, net of allowance of $4,164 and $3,746, respectively	230,132		217,156
Inventories, net	Inventories, net	204,000		176,207		Inventories, net	171,634		170,360
Prepaid expenses and other current assets	Prepaid expenses and other current assets	37,578		21,467		Prepaid expenses and other current assets	19,015		18,813

Total current assets	Total current assets	539,201		446,967		Total current assets	428,278		423,937
Property, plant, and equipment, net	Property, plant, and equipment, net	105,097		96,885		Property, plant, and equipment, net	107,701		109,584
Operating lease assets	Operating lease assets	24,850		18,120		Operating lease assets	24,432		26,502
Goodwill	Goodwill	510,866		510,942		Goodwill	512,639		512,363
Acquired intangibles	Acquired intangibles	145,374		141,504		Acquired intangibles	134,735		137,526
Other assets	Other assets	875		483		Other assets	707		701
		$	1,326,263	$	1,214,901		$	1,208,492	$	1,210,613
Liabilities and Stockholders’ Equity	Liabilities and Stockholders’ Equity					Liabilities and Stockholders’ Equity
Current liabilities:	Current liabilities:					Current liabilities:
Accounts payable	Accounts payable	$	157,167	$	172,286	Accounts payable	$	129,661	$	106,582
Accrued expenses and other current liabilities		82,789		67,993
Accrued expenses						Accrued expenses	67,103		73,721
Billings in excess of cost	Billings in excess of cost	42,412		46,711		Billings in excess of cost	42,929		35,017

Total current liabilities	Total current liabilities	282,368		286,990		Total current liabilities	239,693		215,320
Long-term debt	Long-term debt	121,840		23,781		Long-term debt	49,876		88,762
Deferred income taxes	Deferred income taxes	40,257		40,278		Deferred income taxes	47,030		47,088
Non-current operating lease liabilities	Non-current operating lease liabilities	17,956		11,390		Non-current operating lease liabilities	17,488		19,041
Other non-current liabilities	Other non-current liabilities	20,351		27,204		Other non-current liabilities	19,018		18,303
Stockholders’ equity:	Stockholders’ equity:					Stockholders’ equity:
Preferred stock, $0.01 par value; authorized 10,000 shares; none outstanding	Preferred stock, $0.01 par value; authorized 10,000 shares; none outstanding	—		—		Preferred stock, $0.01 par value; authorized 10,000 shares; none outstanding	—		—
Common stock, $0.01 par value; authorized 100,000 shares in 2022 and 2021; 34,034 shares and 33,799 shares issued and outstanding in 2022 and 2021		340		338
Common stock, $0.01 par value; authorized 100,000 shares; 34,148 and 34,060 shares issued and outstanding in 2023 and 2022						Common stock, $0.01 par value; authorized 100,000 shares; 34,148 and 34,060 shares issued and outstanding in 2023 and 2022	341		340
Additional paid-in capital	Additional paid-in capital	320,428		314,541		Additional paid-in capital	324,466		322,873
Retained earnings	Retained earnings	624,630		545,572		Retained earnings	649,077		627,978
Accumulated other comprehensive (loss) income		(6,769)		187
Treasury stock, at cost, 2,530 and 1,107 shares in 2022 and 2021		(95,138)		(35,380)
Accumulated other comprehensive loss						Accumulated other comprehensive loss	(3,539)		(3,432)
Cost of 3,389 and 3,199 common shares held in treasury in 2023 and 2022						Cost of 3,389 and 3,199 common shares held in treasury in 2023 and 2022	(134,958)		(125,660)
Total stockholders’ equity	Total stockholders’ equity	843,491		825,258		Total stockholders’ equity	835,387		822,099
		$	1,326,263	$	1,214,901		$	1,208,492	$	1,210,613

See accompanying notes to consolidated financial statements.

Table of Contents

GIBRALTAR INDUSTRIES, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)


		Nine Months Ended September 30,					Three Months Ended March 31,
		2022		2021			2023		2022
Cash Flows from Operating Activities	Cash Flows from Operating Activities					Cash Flows from Operating Activities
Net income	Net income	$	79,058	$	66,267	Net income	$	21,099	$	15,456
Income from discontinued operations		—		1,544
Income from continuing operations		79,058		64,723

Adjustments to reconcile net income to net cash provided by (used in) operating activities:	Adjustments to reconcile net income to net cash provided by (used in) operating activities:					Adjustments to reconcile net income to net cash provided by (used in) operating activities:

Depreciation and amortization	Depreciation and amortization	19,192		23,958		Depreciation and amortization	6,834		6,336
Stock compensation expense	Stock compensation expense	5,889		6,769		Stock compensation expense	1,594		1,352

Exit activity costs, non-cash		1,427		1,193
Exit activity (recoveries) costs, non-cash						Exit activity (recoveries) costs, non-cash	(63)		1,198

Provision for (benefit of) deferred income taxes		181		(689)
(Benefit of) provision for deferred income taxes						(Benefit of) provision for deferred income taxes	(51)		17

Other, net	Other, net	3,620		1,274		Other, net	1,023		1,395

Changes in operating assets and liabilities, excluding the effects of acquisitions:	Changes in operating assets and liabilities, excluding the effects of acquisitions:					Changes in operating assets and liabilities, excluding the effects of acquisitions:
Accounts receivable	Accounts receivable	(25,538)		(65,297)		Accounts receivable	(18,004)		(11,101)
Inventories	Inventories	(19,840)		(65,906)		Inventories	(1,586)		(20,937)
Other current assets and other assets	Other current assets and other assets	393		(316)		Other current assets and other assets	2,536		731
Accounts payable	Accounts payable	(24,756)		32,029		Accounts payable	23,077		(11,962)
Accrued expenses and other non-current liabilities	Accrued expenses and other non-current liabilities	(1,065)		(12,261)		Accrued expenses and other non-current liabilities	1,586		9,761
Net cash provided by (used in) operating activities of continuing operations		38,561		(14,523)
Net cash used in operating activities of discontinued operations		—		(2,002)

Net cash provided by (used in) operating activities	Net cash provided by (used in) operating activities	38,561		(16,525)		Net cash provided by (used in) operating activities	38,045		(7,754)
Cash Flows from Investing Activities	Cash Flows from Investing Activities					Cash Flows from Investing Activities
Acquisitions, net of cash acquired	Acquisitions, net of cash acquired	(51,621)		4,143		Acquisitions, net of cash acquired	554		—
Purchases of property, plant, and equipment		(15,704)		(13,251)
Net proceeds from sale of business		—		38,062
Purchases of property, plant, and equipment, net						Purchases of property, plant, and equipment, net	(2,190)		(4,402)

Net cash (used in) provided by investing activities of continuing operations		(67,325)		28,954
Net cash used in investing activities of discontinued operations		—		(176)
Net cash (used in) provided by investing activities		(67,325)		28,778

Net cash used in investing activities						Net cash used in investing activities	(1,636)		(4,402)
Cash Flows from Financing Activities	Cash Flows from Financing Activities					Cash Flows from Financing Activities
Long-term debt payments						Long-term debt payments	(50,000)		(29,000)
Proceeds from long-term debt	Proceeds from long-term debt	197,800		58,500		Proceeds from long-term debt	11,000		47,500
Long-term debt payments		(100,000)		(83,636)

Purchase of common stock at market prices	Purchase of common stock at market prices	(58,125)		(6,161)		Purchase of common stock at market prices	(7,509)		(3,461)
Net proceeds from issuance of common stock		—		1,021

Net cash provided by (used in) financing activities		39,675		(30,276)

Net cash (used in) provided by financing activities						Net cash (used in) provided by financing activities	(46,509)		15,039
Effect of exchange rate changes on cash	Effect of exchange rate changes on cash	(1,841)		(97)		Effect of exchange rate changes on cash	(11)		(159)
Net increase (decrease) in cash and cash equivalents		9,070		(18,120)
Net (decrease) increase in cash and cash equivalents						Net (decrease) increase in cash and cash equivalents	(10,111)		2,724
Cash and cash equivalents at beginning of year	Cash and cash equivalents at beginning of year	12,849		32,054		Cash and cash equivalents at beginning of year	17,608		12,849
Cash and cash equivalents at end of period	Cash and cash equivalents at end of period	$	21,919	$	13,934	Cash and cash equivalents at end of period	$	7,497	$	15,573

See accompanying notes to consolidated financial statements.

Table of Contents

GIBRALTAR INDUSTRIES, INC.

CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY

(in thousands)

(unaudited)


		Common Stock			Additional Paid-In Capital				Retained Earnings			Accumulated Other Comprehensive Income (Loss)		Treasury Stock					Total Stockholders’ Equity				Common Stock					Additional Paid-In Capital				Retained Earnings			Accumulated Other Comprehensive (Loss) Income				Treasury Stock					Total Stockholders’ Equity
		Shares	Amount								Shares			Amount				Shares				Amount									Shares							Amount
Balance at December 31, 2021		33,799	$	338			$	314,541				$	545,572	$	187	1,107					$	(35,380)		$	825,258
Balance at December 31, 2022																						Balance at December 31, 2022	34,060			$	340		$	322,873			$	627,978		$	(3,432)			3,199		$	(125,660)		$	822,099
Net income	Net income	—	—		—				15,456			—		—		—			15,456			Net income	—			—		—				21,099			—				—		—			21,099
Foreign currency translation adjustment	Foreign currency translation adjustment	—	—		—				—			(227)		—		—			(227)			Foreign currency translation adjustment	—			—		—				—			(115)				—		—			(115)
Minimum post retirement benefit plan adjustments, net of taxes of $10		—	—		—				—			24		—		—			24
Minimum post retirement benefit plan adjustments, net of taxes of $3																						Minimum post retirement benefit plan adjustments, net of taxes of $3	—			—		—				—			8				—		—			8
Stock compensation expense	Stock compensation expense	—	—		1,352				—			—		—		—			1,352			Stock compensation expense	—			—		1,594				—			—				—		—			1,594

Net settlement of restricted stock units	Net settlement of restricted stock units	173	2		(2)				—			—		72		(3,461)			(3,461)			Net settlement of restricted stock units	88			1		(1)				—			—				36		(1,929)			(1,929)
Balance at March 31, 2022		33,972	$	340	$	315,891			$	561,028		$	(16)	1,179		$	(38,841)		$	838,402
Net income		—	—		—				29,307			—		—		—			29,307
Foreign currency translation adjustment		—	—		—				—			(3,198)		—		—			(3,198)
Minimum post retirement benefit plan adjustments, net of taxes of $0		—	—		—				—			1		—		—			1
Stock compensation expense		—	—		2,773				—			—		—		—			2,773
Awards of common stock		16	—		—				—			—		—		—			—
Net settlement of restricted stock units		1	—		—				—			—		—		(7)			(7)
Common stock repurchased under stock repurchase program	Common stock repurchased under stock repurchase program	—	—		—				—			—		1,195		(50,000)			(50,000)			Common stock repurchased under stock repurchase program	—			—		—				—			—				154		(7,369)			(7,369)
Balance at June 30, 2022		33,989	$	340	$	318,664			$	590,335		$	(3,213)	2,374		$	(88,848)		$	817,278
Net income		—	—		—				34,295			—		—		—			34,295
Foreign currency translation adjustment		—	—		—				—			(3,568)		—		—			(3,568)
Minimum post retirement benefit plan adjustments, net of taxes of $5		—	—		—				—			12		—		—			12
Stock compensation expense		—	—		1,764				—			—		—		—			1,764
Balance at March 31, 2023																						Balance at March 31, 2023	34,148			$	341	$	324,466			$	649,077		$	(3,539)			3,389		$	(134,958)		$	835,387

Awards of common shares		—	—		—				—			—		—		—			—
Net settlement of restricted stock units		45	—		—				—			—		18		(749)			(749)
Common stock repurchased under stock repurchase program		—	—		—				—			—		138		(5,541)			(5,541)
Balance at September 30, 2022		34,034	$	340	$	320,428			$	624,630		$	(6,769)	2,530		$	(95,138)		$	843,491




Balance at December 31, 2021	33,799	$	338	$	314,541	$	545,572	$	187	1,107	$	(35,380)	$	825,258
Net income	—	—		—		15,456		—		—	—		15,456
Foreign currency translation adjustment	—	—		—		—		(227)		—	—		(227)
Minimum post retirement benefit plan adjustments, net of taxes of $10	—	—		—		—		24		—	—		24

Stock compensation expense	—	—		1,352		—		—		—	—		1,352



Net settlement of restricted stock units	173	2		(2)		—		—		72	(3,461)		(3,461)

Balance at March 31, 2022	33,972	$	340	$	315,891	$	561,028	$	(16)	1,179	$	(38,841)	$	838,402

See accompanying notes to consolidated financial statements.

~~Table of Contents~~

~~GIBRALTAR INDUSTRIES, INC.~~

~~CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY~~

~~(in thousands)~~

~~(unaudited)~~

Common Stock Additional
Paid-In Capital Retained Earnings Accumulated
Other
Comprehensive (Loss) Income Treasury Stock Total
Stockholders’ Equity
Shares Amount Shares Amount
Balance at December 31, 2020 33,568 $ 336 $ 304,870 $ 469,943 $ (2,461) 1,028 $ (28,883) $ 743,805
Net income — — — 12,762 — — — 12,762
Foreign currency translation adjustment — — — — 3,198 — — 3,198
Minimum post retirement benefit plan adjustments, net of taxes of $10 — — — — 27 — — 27
Stock compensation expense — — 2,368 — — — — 2,368
Stock options exercised 25 — 910 — — — — 910
Net settlement of restricted stock units 118 1 (1) — — 54 (4,662) (4,662)
Balance at March 31, 2021 33,711 $ 337 $ 308,147 $ 482,705 $ 764 1,082 $ (33,545) $ 758,408
Net income — — — 25,949 — — — 25,949
Foreign currency translation adjustment — — — — 761 — — 761
Minimum post retirement benefit plan adjustments, net of taxes of $10 — — — — 27 — — 27
Stock compensation expense — — 2,567 — — — — 2,567
Stock options exercised 1 — 14 — — — — 14
Awards of common shares 3 — — — — — — —
Net settlement of restricted stock units 3 — — — — 1 (118) (118)
Balance at June 30, 2021 33,718 $ 337 $ 310,728 $ 508,654 $ 1,552 1,083 $ (33,663) $ 787,608
Net income — — — 27,556 — — — 27,556
Foreign currency translation adjustment — — — — (1,057) — — (1,057)
Minimum post retirement benefit plan adjustments, net of taxes of $9 — — — — 27 — — 27
Stock compensation expense — — 1,834 — — — — 1,834
Stock options exercised 10 — 97 — — — — 97
Net settlement of restricted stock units 54 1 (1) — — 19 (1,381) (1,381)
Total other comprehensive loss — — — — — — — —
Balance at September 30, 2021 33,782 $ 338 $ 312,658 $ 536,210 $ 522 1,102 $ (35,044) $ 814,684

~~See accompanying notes to consolidated financial statements.~~

Table of Contents

GIBRALTAR INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

(1) CONSOLIDATED FINANCIAL STATEMENTS

The accompanying unaudited consolidated financial statements of Gibraltar Industries, Inc. (the "Company") have been prepared by management in accordance with U.S. generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for the fair presentation of results for the interim period have been included. The Company's operations are seasonal; for this and other reasons financial results for any interim period are not necessarily indicative of the results expected for any subsequent interim period or for the full year. The accompanying unaudited consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in ~~our~~the Company's annual report on Form 10-K for the year ended December 31, ~~2021.~~

2022.

The consolidated balance sheet at December 31, ~~2021~~2022 has been derived from the audited financial statements at that date, but does not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements.

(2) RECENT ACCOUNTING PRONOUNCEMENTS

The Company considers the applicability and impact of Accounting Standards Updates ("ASUs"), and ASUs effective in or after 2023, respectively, which were assessed and determined to be either not applicable, or had or are expected to have minimal impact on the Company's consolidated financial statements and related disclosures.

~~Recent Accounting Pronouncements Not Yet Adopted~~

~~Standard~~

~~Description~~

~~Financial Statement Effect or Other Significant Matters~~

ASU No. 2020-04
Reference Rate Reform (Topic 848), Facilitation of Effects of Reference Rate Reform on Financial Reporting, and
ASU No. 2021-01 Reference Rate Reform (Topic 848), Scope

The amendments in ASU 2020-04 provide optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met, and apply only to contracts, hedging relationships, and other transactions that reference the London Interbank Offered Rate ("LIBOR") or another reference rate expected to be discontinued as a result of reference rate reform. The expedients and exceptions provided by the amendments in ASU 2020-04 do not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2022. The amendments in ASU 2021-01 clarify that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition.

The amendments in these updates are effective as of March 12, 2020 through December 31, 2022, and may be applied retrospectively to contract modifications and hedging relationships from the beginning of an interim period that includes or is subsequent to March 12, 2020, or on a prospective basis to new modifications from any date within an interim period that includes or is subsequent to the date of the issuance of a final update, up to the date the financial statements are available to be issued. The adoption of the amendments in these updates is not expected to have a material impact on the Company's financial statements.

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(3) ACCOUNTS RECEIVABLE, NET

Accounts receivable ~~consists~~consisted of the following (in thousands):

September 30, 2022 December 31, 2021
Trade accounts receivable $ 222,368 $ 185,745
Costs in excess of billings 57,183 54,437
Total accounts receivables 279,551 240,182
Less allowance for doubtful accounts and contract assets (3,847) (3,738)
Accounts receivable, net $ 275,704 $ 236,444


	March 31, 2023		December 31, 2022
Trade accounts receivable	$	189,281	$	179,170
Costs in excess of billings	45,015		41,732
Total accounts receivables	234,296		220,902
Less allowance for doubtful accounts and contract assets	(4,164)		(3,746)
Accounts receivable, net	$	230,132	$	217,156

Refer to Note 4 "Revenue" concerning the Company's costs in excess of billings.

The following table provides a roll-forward of the allowance for credit losses, for the ~~nine~~three month period ended ~~September 30, 2022,~~March 31, 2023, that is deducted from the amortized cost basis of accounts receivable to present the net amount expected to be ~~collected.~~collected (in thousands):


Beginning balance as of January 1, ~~2022~~2023	$	~~3,738~~3,746

Bad debt expense, net of recoveries	~~960~~260
Accounts written off against allowance and other adjustments	~~(851)~~158
Ending balance as of ~~September 30, 2022~~March 31, 2023	$	~~3,847~~4,164

(4) REVENUE

Sales includes revenue from contracts with customers for designing, engineering, manufacturing and installation of solar racking systems; electrical balance of systems; roof and foundation ventilation products; centralized mail systems and electronic package solutions; retractable awnings; gutter guards; rain dispersion products; trims and flashings and other accessories; designing, engineering, manufacturing and installation of greenhouses; structural bearings; expansion joints; pavement sealant; elastomeric concrete; and bridge cable protection systems.

Refer to Note 1514 "Segment Information" for additional information related to revenue recognized by timing of transfer of control by reportable segment.

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As of ~~September 30, 2022,~~March 31, 2023, the Company's remaining performance obligations are part of contracts that have an original expected duration of one year or less.

Contract assets consist of costs in excess of billings presented within accounts receivable in the Company's consolidated balance sheets. Contract liabilities consist of billings in excess of cost, classified as current liabilities, and unearned revenue, presented within accrued expenses, in the Company's consolidated balance sheets. Unearned revenue as of ~~September 30, 2022~~March 31, 2023 and December 31, ~~2021~~2022 was ~~$3.4~~$7.8 million and ~~$3.7~~$4.6 million, respectively. Revenue recognized during the ~~nine~~three months ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021~~ that was in contract liabilities at the beginning of the respective periods was ~~$41.2~~$18.7 million and ~~$52.6~~$27.4 million, respectively.

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(5) INVENTORIES

Inventories ~~consist~~consisted of the following (in thousands):


		September 30, 2022		December 31, 2021			March 31, 2023		December 31, 2022
Raw material	Raw material	$	132,084	$	135,558	Raw material	$	120,150	$	111,187
Work-in-process	Work-in-process	21,642		5,858		Work-in-process	12,824		17,944
Finished goods	Finished goods	56,955		39,256		Finished goods	44,944		47,523
Gross inventory	Gross inventory	210,681		180,672		Gross inventory	177,918		176,654
Less reserves	Less reserves	(6,681)		(4,465)		Less reserves	(6,284)		(6,294)
Total inventories, net	Total inventories, net	$	204,000	$	176,207	Total inventories, net	$	171,634	$	170,360

(6) ACQUISITION

On August 22, 2022, the Company purchased all the issued and outstanding membership interests of Quality Aluminum Products ("QAP"), a manufacturer of aluminum and steel products including soffit, fascia, trim coil, rain carrying products and aluminum siding. The results of QAP have been included in the Company's consolidated financial results since the date of acquisition within the Company's Residential segment. The ~~preliminary~~ purchase consideration for the acquisition of QAP was ~~$52.6~~$52.1 million, which includes a ~~preliminary~~ working capital adjustment and certain other adjustments provided for in the membership interest purchase agreement.

The purchase price for the acquisition was ~~preliminarily~~ allocated to the assets acquired and liabilities assumed based upon their respective fair values estimated as of the date of acquisition. The Company has ~~commenced~~completed the process to confirm the existence, condition, and completeness of the assets acquired and liabilities assumed to establish fair value of such assets and liabilities and to determine the amount of goodwill to be recognized as of the date of acquisition. Due to the timing of the acquisition, we continue to gather information supporting the acquired assets and assumed liabilities. Accordingly, all amounts recorded are provisional. These provisional amounts are subject to change if new information is obtained concerning facts and circumstances that existed as of the acquisition date that, if known, would have affected the measurement of the amounts recognized as of that date. The final determination of the fair value of certain assets and liabilities ~~will be~~has been completed within a measurement period of up to one year from the date of acquisition. The ~~final values may also result in changes to depreciation and amortization expense related to certain assets such as property, plant and equipment and acquired intangible assets. The preliminary~~ excess consideration was recorded as goodwill and approximated ~~$3.5~~$4.0 million, all of which is deductible for tax purposes. Goodwill represents future economic benefits arising from other assets acquired that could not be individually identified including workforce additions, growth opportunities, and increased presence in the domestic building products markets. ~~The final purchase price allocation will be completed no later than the third quarter of fiscal year 2023.~~

The ~~preliminary~~ allocation of the purchase consideration to the estimated fair value of the assets acquired and liabilities assumed is as follows as of the date of the acquisition (in thousands):


Cash	$	1,018
Working capital	~~24,279~~23,372
Property, plant and equipment	~~3,462~~8,486
Acquired intangible assets	~~20,000~~14,700
Other assets	~~404~~1,813
Other liabilities	(1,295)
Goodwill	~~3,476~~3,991
Fair value of purchase consideration	$	~~52,639~~52,085

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The intangible assets acquired in this acquisition consisted of the following (in thousands):

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	Fair Value		Weighted-Average Amortization Period
Trademarks	$	~~5,000~~2,800	Indefinite


Customer relationships	~~15,000~~11,900		1512 years
Total	$	~~20,000~~14,700

In determining the ~~preliminary~~ allocation of the purchase price to the assets acquired and liabilities assumed, the Company uses all available information to make fair value determinations using Level 3 unobservable inputs in which little or no market data exists, and therefore, engages independent valuation specialists to assist in the fair value determination of the acquired long-lived assets.

The acquisition of QAP was financed primarily through borrowings under the Company's revolving credit facility.

The Company ~~incurred~~recognized costs related to ~~the acquisition~~recent acquisitions comprised of QAP that have been recognized in the consolidated statements of income. Within cost of sales, the Company recognizes the amortization of the purchase price allocated to the step up of inventory to fair value. Legallegal and consulting fees ~~incurred as a result of the acquisition were recognized as a component of~~within selling, general, and administrative ~~expenses.~~

~~The acquisition-related costs consisted~~("SG&A") expenses of ~~the following~~$21.0 thousand and $7.0 thousand for the three ~~and nine~~ months ended ~~September 30 (in thousands):~~March 31, 2023 and 2022, respectively.

Three Months Ended
September 30, Nine Months Ended
September 30,
2022 2021 2022 2021
Cost of sales $ 476 $ — $ 476 $ —
Selling, general and administrative costs 522 53 529 946
Total acquisition related costs $ 998 $ 53 $ 1,005 $ 946

(7) GOODWILL AND RELATED INTANGIBLE ASSETS

Goodwill

The changes in the carrying amount of goodwill for the ~~nine~~three months ended ~~September 30, 2022~~March 31, 2023 are as follows (in thousands):

Renewables Residential Agtech Infrastructure Total
Balance at December 31, 2021 $ 188,680 $ 205,452 $ 85,132 $ 31,678 $ 510,942
Acquired goodwill — 3,476 — — 3,476
Adjustments to prior year acquisitions 904 — — — 904
Foreign currency translation (2,545) — (1,911) — (4,456)
Balance at September 30, 2022 $ 187,039 $ 208,928 $ 83,221 $ 31,678 $ 510,866


	Renewables		Residential		Agtech		Infrastructure		Total
Balance at December 31, 2022	$	188,030	$	209,056	$	83,599	$	31,678	$	512,363

Adjustments to prior year acquisitions	—		387		—		—		387
Foreign currency translation	(141)		—		30		—		(111)
Balance at March 31, 2023	$	187,889	$	209,443	$	83,629	$	31,678	$	512,639

Goodwill is recognized net of accumulated impairment losses of $133.2 million as of March 31, 2023 and December 31, 2022, respectively.

The Company is required to regularly assess whether a triggering event has occurred which would require interim impairment testing. The Company determined that no triggering event had occurred as of ~~September 30, 2022~~March 31, 2023 which would require an interim impairment test to be performed.

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Acquired Intangible Assets

Acquired intangible assets ~~consist~~consisted of the following (in thousands):


		September 30, 2022				December 31, 2021					March 31, 2023				December 31, 2022
		Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Indefinite-lived intangible assets:	Indefinite-lived intangible assets:									Indefinite-lived intangible assets:
Trademarks	Trademarks	$	57,700	$	—	$	52,700	$	—	Trademarks	$	55,500	$	—	$	55,500	$	—
Finite-lived intangible assets:	Finite-lived intangible assets:									Finite-lived intangible assets:
Trademarks	Trademarks	5,432		4,337		5,521		4,011		Trademarks	5,449		4,516		5,448		4,481
Unpatented technology	Unpatented technology	34,117		21,456		38,474		20,656		Unpatented technology	34,165		22,610		34,163		22,037
Customer relationships	Customer relationships	117,429		43,914		108,591		39,832		Customer relationships	115,027		48,609		115,125		46,557
Non-compete agreements	Non-compete agreements	2,368		1,965		2,686		1,969		Non-compete agreements	2,371		2,042		2,371		2,006
Backlog		6,852		6,852		7,200		7,200

		166,198		78,524		162,472		73,668			157,012		77,777		157,107		75,081
Total acquired intangible assets	Total acquired intangible assets	$	223,898	$	78,524	$	215,172	$	73,668	Total acquired intangible assets	$	212,512	$	77,777	$	212,607	$	75,081

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The following table summarizes the acquired intangible asset amortization expense for the three ~~and nine~~ months ended ~~September 30~~March 31, (in thousands):

Three Months Ended
September 30, Nine Months Ended
September 30,
2022 2021 2022 2021
Amortization expense $ 2,801 $ 4,646 $ 8,718 $ 14,125



	2023		2022
Amortization expense	$	2,766	$	3,098

Amortization expense related to acquired intangible assets for the remainder of fiscal ~~2022~~2023 and the next five years thereafter is estimated as follows (in thousands):

2022 2023 2024 2025 2026 2027
Amortization expense $ 2,905 $ 11,140 $ 10,960 $ 10,820 $ 9,397 $ 7,747


	2023		2024		2025		2026		2027		2028
Amortization expense	$	8,297	$	10,883	$	10,745	$	9,338	$	7,699	$	6,832

(8) LONG-TERM DEBT

Long-term debt ~~consists~~consisted of the following (in thousands):


		September 30, 2022		December 31, 2021			March 31, 2023		December 31, 2022
Revolving credit facility	Revolving credit facility	$	122,300	$	24,500	Revolving credit facility	$	52,000	$	91,000

Less unamortized debt issuance costs	Less unamortized debt issuance costs	(460)		(719)		Less unamortized debt issuance costs	(2,124)		(2,238)
Total debt	Total debt	$	121,840	$	23,781	Total debt	$	49,876	$	88,762

~~Senior~~Revolving Credit ~~Agreement~~

Facility

On ~~January 24, 2019,~~December 8, 2022, the Company entered into a Credit Agreement (the "Credit Agreement"), and concurrently with entering into the Credit Agreement, the Company paid off all amounts owed under the Sixth Amended and Restated Credit Agreement ~~("Senior~~dated as of January 24, 2019. The Credit ~~Agreement"), which amended and restated the Company’s Fifth Amended and Restated Credit~~ Agreement ~~dated December 9, 2015, and~~ provides for a revolving credit facility and letters of credit in an aggregate amount equal to $400 million. The Company can request additional financing ~~from the lenders~~ to increase the revolving credit facility to $700 million or enter into a term loan of up to $300 million subject to conditions set forth in the ~~Senior~~ Credit Agreement. The ~~Senior~~ Credit Agreement contains ~~three~~two financial covenants. As of ~~September 30, 2022,~~March 31, 2023, the Company was in compliance with all ~~three~~financial covenants. The Credit Agreement terminates on December 8, 2027.

~~Table~~Borrowings under the Credit Agreement bear interest, at the Company’s option, at a rate equal to the applicable margin plus (a) a base rate, (b) a daily simple secured overnight financing rate ("SOFR") rate, (c) a term SOFR rate or (d) for certain foreign currencies, a foreign currency rate, in each case subject to a 0% floor. Through March 31, 2023, the Credit Agreement had an initial applicable margin of ~~Contents~~

~~Interest rates~~0.125% for base rate loans and 1.125% for SOFR and alternative currency loans. Thereafter, the applicable margin ranges from 0.125% to 1.00% for base rate loans and from 1.125% to 2.00% for SOFR and alternative currency loans based on the Company’s Total Net Leverage Ratio, as defined in the Credit Agreement. In addition, the Credit Agreement is subject to an annual commitment fee, payable quarterly, which is initially 0.20% of the daily average undrawn balance of the revolving credit facility ~~are based on LIBOR plus an additional margin that~~and, from and after April 1, 2023, ranges ~~from 1.125% to 2.00%. In addition,~~between 0.20% and 0.25% of the daily average undrawn balance of the revolving credit facility ~~is subject to an undrawn commitment fee ranging between 0.15% and 0.25%~~ based on the Company’s Total Net Leverage ~~Ratio (as defined in the Senior Credit Agreement) and the daily average undrawn balance. The Senior Credit Agreement terminates on January 23, 2024.~~

Ratio.

Borrowings under the ~~Senior~~ Credit Agreement are secured by the trade receivables, inventory, personal property, equipment, and general intangibles of the Company’s significant domestic subsidiaries. Capital distributions ~~under the Senior Credit Agreement~~ are subject to certain Total Net Leverage Ratio requirements and capped atby an annual aggregate limit ~~of $75 million if~~under the ~~Company's leverage ratio is over 3.0 times.~~Credit Agreement.

For the three months ended March 31, 2022, interest rates on the revolving credit facility under the Sixth Amended and Restated Credit Agreement were based on LIBOR plus an additional margin that ranges from 1.125% to 2.00%. In addition, the revolving credit facility under the Sixth Amended and Restated Credit Agreement was subject to an undrawn commitment fee ranging between 0.15% and 0.25% based on the Total Leverage Ratio and the daily average undrawn balance.

Standby letters of credit of ~~$4.5~~$4.3 million have been issued under the ~~Senior~~ Credit Agreement to third parties on behalf of the Company as of ~~September 30, 2022.~~March 31, 2023. These letters of credit reduce the amount otherwise available under the revolving credit facility. The Company had ~~$273.2~~$343.7 million and ~~$369.3~~$304.5 million of availability under the revolving credit facility ~~at September 30, 2022~~as of March 31, 2023 and December 31, ~~2021,~~2022, respectively.

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(9) ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

The following tables summarize the cumulative balance of each component of accumulated other comprehensive (loss) income, ~~(loss),~~ net of tax, for the three ~~and nine~~ months ended ~~September 30,~~March 31, (in thousands):


		Foreign Currency Translation Adjustment		Minimum Post Retirement Benefit Plan Adjustments		Total Pre-Tax Amount		Tax Benefit (Expense)		Accumulated Other Comprehensive Income (Loss)			Foreign Currency Translation Adjustment		Minimum Post Retirement Benefit Plan Adjustments		Total Pre-Tax Amount		Tax Benefit (Expense)		Accumulated Other Comprehensive (Loss) Income
Balance at December 31, 2021		$	1,640	$	(2,247)	$	(607)	$	794	$	187
Balance at December 31, 2022												Balance at December 31, 2022	$	(3,382)	$	(395)	$	(3,777)	$	(345)	$	(3,432)

Minimum post retirement health care plan adjustments	Minimum post retirement health care plan adjustments	—		34		34		(10)		24		Minimum post retirement health care plan adjustments	—		11		11		3		8
Foreign currency translation adjustment	Foreign currency translation adjustment	(227)		—		(227)		—		(227)		Foreign currency translation adjustment	(115)		—		(115)		—		(115)
Balance at March 31, 2022		1,413		(2,213)		(800)		784		(16)
Balance at March 31, 2023												Balance at March 31, 2023	$	(3,497)	$	(384)	$	(3,881)	$	(342)	$	(3,539)

Minimum post retirement health care plan adjustments		—		1		1		—		1
Foreign currency translation adjustment		(3,198)		—		(3,198)		—		(3,198)
Balance at June 30, 2022		(1,785)		(2,212)		(3,997)		784		(3,213)
Minimum post retirement health care plan adjustments		—		17		17		(5)		12
Foreign currency translation adjustment		(3,568)		—		(3,568)		—		(3,568)
Balance at September 30, 2022		$	(5,353)	$	(2,195)	$	(7,548)	$	779	$	(6,769)

Foreign Currency Translation Adjustment Minimum Post Retirement Benefit Plan
Adjustments Total Pre-Tax Amount Tax Benefit (Expense) Accumulated Other
Comprehensive
(Loss) Income
Balance at December 31, 2020 $ (872) $ (2,426) $ (3,298) $ 837 $ (2,461)
Minimum post retirement health care plan adjustments — 37 37 (10) 27
Foreign currency translation adjustment 3,198 — 3,198 — 3,198
Balance at March 31, 2021 2,326 (2,389) (63) 827 764
Minimum post retirement health care plan adjustments — 37 37 (10) 27
Foreign currency translation adjustment 761 — 761 — 761
Balance at June 30, 2021 3,087 (2,352) 735 817 1,552
Minimum post retirement health care plan adjustments — 36 36 (9) 27
Foreign currency translation adjustment (1,057) — (1,057) — (1,057)
Balance at September 30, 2021 $ 2,030 $ (2,316) $ (286) $ 808 $ 522

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Balance at December 31, 2021	$	1,640	$	(2,247)	$	(607)	$	794	$	187

Minimum post retirement health care plan adjustments	—		34		34		(10)		24
Foreign currency translation adjustment	(227)		—		(227)		—		(227)
Balance at March 31, 2022	$	1,413	$	(2,213)	$	(800)	$	784	$	(16)

The realized adjustments relating to the Company’s minimum post retirement health care costs were reclassified from accumulated other comprehensive loss and included in other expense in the consolidated statements of income.

(10) EQUITY-BASED COMPENSATION

On May 4, 2022, the stockholders of the Company approved the adoption of the Gibraltar Industries, Inc. Amended and Restated 2016 Stock Plan for Non-Employee Directors ("Non-Employee Directors Plan") which increases the total number of shares for issuance by the Company thereunder from 100,000 shares to 200,000 shares, allows the Company to grant awards of shares of the Company's common stock to current non-employee Directors of the Company, and permits the Directors to defer receipt of such shares pursuant to the terms of the Non-Employee Directors Plan.

On May 4, 2018, the stockholders of the Company approved the adoption of the Gibraltar Industries, Inc. 2018 Equity Incentive Plan (the "2018 Plan"). The 2018 Plan provides for the issuance of up to 1,000,000 shares of common stock and supplements the remaining shares available for issuance under the Gibraltar Industries, Inc. 2015 Equity Incentive Plan (the "2015 Plan"). Both the 2018 Plan and the 2015 Plan allow the Company to grant equity-based incentive compensation awards, in the form of non-qualified options, restricted shares, restricted stock units, performance shares, performance stock units, and stock rights to eligible participants.

Equity Based Awards - Settled in Stock

The following table sets forth the number of equity-based awards granted during the ~~nine~~three months ended ~~September 30,~~March 31, which will convert to shares upon vesting, along with the weighted average grant date fair values:


		2022			2021				2023			2022
Awards	Awards	Number of Awards	Weighted Average Grant Date Fair Value		Number of Awards (2)	Weighted Average Grant Date Fair Value		Awards	Number of Awards	Weighted Average Grant Date Fair Value		Number of Awards (2)	Weighted Average Grant Date Fair Value
Performance stock units (1)	Performance stock units (1)	108,464	$	47.00	62,778	$	87.84	Performance stock units (1)	81,611	$	53.44	108,464	$	47.00
Restricted stock units	Restricted stock units	123,351	$	43.42	62,873	$	80.43	Restricted stock units	46,646	$	53.44	58,958	$	47.00
Deferred stock units		2,460	$	42.69	7,536	$	83.58
Common shares		15,652	$	42.49	2,512	$	83.58

(1) The Company’s performance stock units (“PSUs”) represent shares granted for which the final number of shares earned depends on financial ~~performance or market conditions.~~performance. The number of shares to be issued may vary between 0% and 200% of the number of PSUs granted depending on the relative achievement to targeted thresholds. The Company's PSUs with a financial performance condition are based on the Company’s return on invested capital (“ROIC”) over a one-year performance period.

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(2) ~~All~~ PSUs granted in the first quarter of ~~2021~~2022 includes 5,653 units that were forfeited in the first quarter of ~~2022 as~~2023 and 62,201 units that will be converted to shares and issued to recipients in the ~~threshold level~~first quarter of ~~achievement was not met~~2025 at 60.5% of the target amount granted, based on the Company's actual ROIC ~~achievement level~~compared to ROIC target for the performance period ended December 31, ~~2021.~~2022.

Equity Based Awards - Settled in Cash

The Company's equity-based awards that are settled in cash are the awards under the Management Stock Purchase Plan (the “MSPP”) which is authorized under the Company's equity incentive plans. The MSPP provides participants the ability to defer a portion of their compensation, convertible to unrestricted investments, restricted stock units, or a combination of both, or defer a portion of their directors’ fees, convertible to restricted stock units. Employees eligible to defer a portion of their compensation also receive a company-matching award in restricted stock units equal to a percentage of their compensation.

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The deferrals and related company match are credited to an account that represents a share-based liability. The portion of the account deferred to unrestricted investments is measured at fair market value of the unrestricted investments, and the portion of the account deferred to restricted stock units and company-matching restricted stock units is measured at a 200-day average of the Company’s stock price. The account will be converted to and settled in cash payable to participants upon retirement or a termination of their service to the Company.

Total MSPP liabilities recorded on the consolidated balance sheet as of ~~September 30, 2022~~March 31, 2023 was ~~$16.2~~$15.9 million, of which ~~$2.8~~$2.0 million was included in current accrued expenses and ~~$13.4~~$13.9 million was included in non-current liabilities. Total MSPP liabilities recorded on the consolidated balance sheet as of December 31, ~~2021~~2022 was ~~$22.6~~$15.4 million, of which ~~$2.9~~$2.3 million was included in current accrued expenses and ~~$19.7~~$13.1 million was included in non-current liabilities. The value of the restricted stock units within the MSPP ~~liabillity~~liability were ~~$14.2~~$13.7 million and ~~$20.7~~$13.4 million at ~~September 30, 2022~~March 31, 2023 and December 31, ~~2021,~~2022, respectively.

The following table provides the number of restricted stock units credited to active participant accounts and the payments made with respect to ~~restricted stock units issued under the~~ MSPP liabilities during the ~~nine~~three months ended ~~September 30,~~March 31,:

2022 2021
Restricted stock units credited 9,564 28,230
Share-based liabilities paid (in thousands) $ 2,961 $ 4,022


	2023		2022
Restricted stock units credited	41,743		2,876
MSPP liabilities paid (in thousands)	$	2,147	$	2,545

(11) ~~HELD FOR SALE AND DISCONTINUED OPERATIONS~~

~~Held for Sale~~

During the first quarter of 2022, the Company committed to a plan to sell its Processing business (the "disposal group") which is a business within the Company's Agtech reportable segment. The planned sale does not meet the criteria to be classified as a discontinued operation. As a result, the Company will continue reporting the operating results of the disposal group in the Company's consolidated operating results from continuing operations until the sale of the business is completed.

The Company classifies assets and related liabilities as held for sale when: (i) management has committed to a plan to sell the assets, (ii) the net assets are available for immediate sale, (iii) there is an active program to locate a buyer and (iv) the sale and transfer of the net assets is probable within one year. Assets and liabilities held for sale are presented separately on our consolidated balance sheets with a valuation allowance, if necessary, to recognize the net carrying amount at the lower of cost or fair value, less costs to sell.

As of September 30, 2022, the assets and liabilities of the disposal group have been classified as held for sale. The following table summarizes these assets and liabilities which have been measured at the lower of (i) the carrying value when classified as held for sale and (ii) the fair value of the business less costs to sell.

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~~(in thousands)~~	~~September 30, 2022~~
~~Assets held for sale~~
~~Accounts receivable, net of allowance~~	$	89
~~Inventories, net of reserves~~	~~8,498~~
~~Other current assets~~	~~1,609~~
~~Property, plant, and equipment, net~~	~~331~~
~~Operating lease asset~~	~~603~~
~~Goodwill~~ ~~(1)~~	—
~~Acquired intangibles, net~~	~~6,213~~
~~Total assets held for sale~~	$	~~17,343~~
~~Liabilities held for sale~~
~~Accounts payable~~	$	~~803~~
~~Accrued expenses~~	74
~~Non-current operating lease liabilities~~	~~165~~
~~Total liabilities held for sale~~	$	~~1,042~~

~~(1)~~ The assignment of goodwill was based on the relative fair value of the disposal group compared to the fair value of the total reporting unit it was included in prior to being reclassified as held for sale.

~~Net sales and operating loss for held for sale operations for the three and nine months ended September 30 are as follows (in thousands):~~

Three months ended
September 30, Nine months ended
September 30,
2022 2021 2022 2021
Net sales $ 2,326 $ 3,825 $ 6,897 $ 16,062
Operating loss $ (481) $ (1,387) $ (4,115) $ (2,689)

Effective with the classification of the disposal group as held for sale, depreciation of property, plant, and equipment and amortization of finite-lived intangible assets and right-of-use assets are not recorded while these assets are classified as held for sale. As a result of our evaluation of the recoverability of the carrying value of the assets and liabilities held for sale relative to an estimated sales price, adjusted for costs to sell, no losses were recorded during the nine months ended September 30, 2022. The recoverability of the disposal group will be evaluated each reporting period until the sale of the business is completed.

~~Discontinued Operations~~

On February 23, 2021, the Company sold the stock of its Industrial business which had been classified as held for sale and reported as a discontinued operation in the Company’s consolidated financial statements for the year ended December 31, 2021. Net proceeds of $38 million, consisting of cash and a $13 million seller note, resulted in an estimated pre-tax loss of $30 million, subject to working capital and other adjustments, of which $29.6 million was recorded when the assets of the Industrial business were written down to fair market value during the fourth quarter of 2020. The seller note was paid in full to the Company during the second quarter of 2021.

The results of operations and financial position of the Industrial business have been presented as a discontinued operation in the Company's consolidated financial statements for all periods presented. The Company allocates interest to its discontinued operations in accordance with ASC Subtopic 205-20, “Presentation of Financial Statements – Discontinued Operations.” Interest was allocated based on the amount of net assets held by the discontinued operation in comparison to consolidated net assets.

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Components of income from discontinued operations before taxes, including the interest allocated to discontinued operations, for the three and nine months ended September 30 are as follows (in thousands):

Three months ended
September 30, Nine months ended
September 30,
2022 2021 2022 2021
Net sales $ — $ — $ — $ 20,391
Operating expenses — — — 17,493
Adjustment to loss on disposal — 201 — 1,031
(Loss) Income from discontinued operations before taxes $ — $ (201) $ — $ 1,867

~~(12)~~ EXIT ACTIVITY COSTS AND ASSET IMPAIRMENTS

The Company has incurred exit activity costs and asset impairment charges as a result of its 80/20 simplification and portfolio management initiatives. These initiatives have resulted in the identification of low-volume, low margin, internally-produced products which have been or will be outsourced or discontinued, the simplification of processes, the sale and exiting of less profitable businesses or product lines, and a reduction in ~~our~~the Company's manufacturing footprint.

Exit activity costs (recoveries) were incurred during the ~~nine~~three months ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021~~ which related to moving and closing costs, ~~severance,~~ and ~~contract terminations,~~severance, along with asset impairment charges (recoveries) related to the write-down of inventory ~~and impairment of machinery and equipment~~ associated with discontinued product lines, as a result of process simplification initiatives. In conjunction with these initiatives, the Company ~~exited~~recorded costs during the three months ended March 31, 2023 associated with the final closure and sale of a facility ~~relocating to a new one, and separately,~~ closed ~~one other facility~~ during the ~~nine months ended September 30,~~fourth quarter of 2022. During the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, the Company closed ~~two facilities~~one facility as a result of these initiatives.

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The following tables set forth the exit activity costs (recoveries) and asset impairment charges (recoveries) incurred by segment during the three ~~and nine~~ months ended ~~September 30,~~March 31, related to the restructuring activities described above (in thousands):

Three months ended September 30,
2022 2021
Exit activity (recoveries) costs, net Asset impairment charges Total Exit activity costs Asset impairment charges Total
Renewables $ (44) $ — $ (44) $ 131 $ — $ 131
Residential — 12 12 83 — 83
Agtech 15 217 232 293 — 293
Infrastructure — — — — — —
Corporate 11 — 11 37 — 37
Total exit activity (recoveries) costs
& asset impairments $ (18) $ 229 $ 211 $ 544 $ — $ 544

Nine months ended September 30,
2022 2021
Exit activity costs (recoveries), net Asset impairment charges Total Exit activity costs Asset impairment charges Total
Renewables $ 1,359 $ 1,198 $ 2,557 $ 4,695 $ 1,193 $ 5,888
Residential 1,298 12 1,310 177 — 177
Agtech 103 217 320 1,784 — 1,784
Infrastructure (63) — (63) — — —
Corporate 93 — 93 96 — 96
Total exit activity costs & asset impairments $ 2,790 $ 1,427 $ 4,217 $ 6,752 $ 1,193 $ 7,945



	2023						2022
	Exit activity costs		Asset impairment recovery		Total		Exit activity costs (recoveries), net		Asset impairment charges		Total
Renewables	$	—	$	(63)	$	(63)	$	1,328	$	1,198	$	2,526
Residential	114		—		114		3		—		3
Agtech	561		—		561		(9)		—		(9)
Infrastructure	—		—		—		(63)		—		(63)
Corporate	—		—		—		20		—		20
Total	$	675	$	(63)	$	612	$	1,279	$	1,198	$	2,477

The following table provides a summary of where the exit activity costs and asset impairment charges were recorded in the consolidated statements of income for the three ~~and nine~~ months ended ~~September 30,~~March 31, (in thousands):

Three Months Ended
September 30, Nine Months Ended
September 30,
2022 2021 2022 2021
Cost of sales $ (39) $ 194 $ 2,249 $ 5,959
Selling, general, and administrative expense 250 350 1,968 1,986
Total exit activity and asset impairment charges $ 211 $ 544 $ 4,217 $ 7,945



	2023		2022
Cost of sales	$	513	$	2,208
Selling, general, and administrative expense	99		269
Total exit activity and asset impairment charges	$	612	$	2,477

The following table reconciles the beginning and ending liability for exit activity costs relating to the Company’s facility consolidation efforts (in thousands):

2022 2021
Balance at January 1 $ 272 $ 1,030
Exit activity costs recognized 2,790 6,752
Cash payments (2,782) (5,970)
Balance at September 30 $ 280 $ 1,812


	2023		2022
Balance at January 1	$	2,417	$	272
Exit activity costs recognized	675		1,279
Cash payments	(1,321)		(116)
Balance at March 31	$	1,771	$	1,435

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~~(13)~~(12) INCOME TAXES

The following table summarizes the provision for income taxes for continuing operations (in thousands) for the three ~~and nine~~ months ended ~~September 30,~~March 31, and the applicable effective tax rates:


		Three Months Ended September 30,						Nine Months Ended September 30,
		2022			2021			2022			2021				2023			2022
Provision for income taxes	Provision for income taxes	$	11,690		$	9,561		$	26,686		$	20,578		Provision for income taxes	$	7,177		$	5,101
Effective tax rate	Effective tax rate	25.4		%	25.6		%	25.2		%	24.1		%	Effective tax rate	25.4		%	24.8		%

The effective tax rate for the three months ended ~~September 30,~~March 31, 2023 and 2022, and 2021, respectively, was greater than the U.S. federal statutory rate of 21% due to state taxes and nondeductible permanent differences. Furthermore, the three months ended September 30, 2021 period was partially offset by favorable discrete items due to an excess tax benefit on stock-based compensation. The effective tax rate for the nine months ended September 30, 2022 and 2021, respectively, was greater than the U.S. federal statutory rate of 21% due to state taxes and nondeductible permanent differences partially offset by favorable discrete ~~items due to an excess tax benefit on stock-based compensation.~~items.

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~~(14)~~(13) EARNINGS PER SHARE

Earnings per share and the weighted average shares outstanding used in calculating basic and diluted earnings per share are as follows for the three ~~and nine~~ months ended ~~September 30,~~March 31, (in thousands):

Three Months Ended
September 30, Nine Months Ended
September 30,
2022 2021 2022 2021
Numerator:
Income from continuing operations $ 34,295 $ 27,854 $ 79,058 $ 64,723
(Loss) income from discontinued operations — (298) — 1,544
Net income available to common stockholders $ 34,295 $ 27,556 $ 79,058 $ 66,267
Denominator for basic earnings per share:
Weighted average shares outstanding 31,707 32,802 32,396 32,791
Denominator for diluted earnings per share:
Weighted average shares outstanding 31,707 32,802 32,396 32,791
Common stock options and stock units 105 248 107 264
Weighted average shares and conversions 31,812 33,050 32,503 33,055



	2023		2022
Numerator:


Net income available to common stockholders	$	21,099	$	15,456
Denominator for basic earnings per share:
Weighted average shares outstanding	30,897		32,913
Denominator for diluted earnings per share:
Weighted average shares outstanding	30,897		32,913
Common stock units	127		109
Weighted average shares and conversions	31,024		33,022

The weighted average number of diluted shares does not include potential anti-dilutive common shares issuable pursuant to equity based incentive compensation awards. The following table provides the potential anti-dilutive common stock ~~options and stock~~ units for the three ~~and nine~~ months ended ~~September 30,~~March 31, (in thousands):

Three Months Ended
September 30, Nine Months Ended
September 30,
2022 2021 2022 2021
Common stock options and stock units 51 30 48 —



	2023	2022
Common stock units	64	54

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~~(15)~~(14) SEGMENT INFORMATION

The Company is organized into four reportable segments on the basis of the production processes, products and services provided by each segment, identified as follows:

(i)Renewables, which primarily includes designing, engineering, manufacturing and installation of solar racking and electrical balance of systems;

(ii)Residential, which primarily includes roof and foundation ventilation products, centralized mail systems and electronic package solutions, retractable awnings and gutter guards, and rain dispersion products, trims and flashings and other accessories;

(iii)Agtech, which provides growing ~~and processing~~ solutions including the designing, engineering, manufacturing and installation of greenhouses; and

(iv)Infrastructure, which primarily includes structural bearings, expansion joints and pavement sealant for bridges, airport runways and roadways, elastomeric concrete, and bridge cable protection systems.

When determining the reportable segments, the Company aggregated operating segments based on their similar economic and operating characteristics.

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The following table illustrates certain measurements used by management to assess performance of the segments described above for the three ~~and nine~~ months ended ~~September 30,~~March 31, (in thousands):



	2023		2022
Net sales:
Renewables	$	59,205	$	78,783
Residential	179,495		179,485
Agtech	35,852		42,428
Infrastructure	18,715		17,169
Total net sales	$	293,267	$	317,865

Income from operations:
Renewables	$	2,269	$	(6,984)
Residential	29,509		33,435
Agtech	2,330		31
Infrastructure	2,714		1,181
Unallocated Corporate Expenses	(7,452)		(6,468)
Total income from operations	$	29,370	$	21,195

Three Months Ended
September 30, Nine Months Ended
September 30,
2022 2021 2022 2021
Net sales:
Renewables $ 111,119 $ 130,162 $ 291,451 $ 323,425
Residential 215,592 171,545 595,322 475,971
Agtech 44,217 48,975 130,325 149,410
Infrastructure 20,363 18,671 59,007 56,528
Total net sales $ 391,291 $ 369,353 $ 1,076,105 $ 1,005,334
Income from operations:
Renewables $ 14,216 $ 12,206 $ 14,061 $ 21,195
Residential 35,802 29,482 104,901 79,571
Agtech 3,777 2,227 5,350 4,133
Infrastructure 2,572 1,640 6,640 7,863
Unallocated Corporate Expenses (8,971) (7,577) (22,222) (30,560)
Total income from operations $ 47,396 $ 37,978 $ 108,730 $ 82,202

September 30,
2022 December 31,
2021
Total assets:
Renewables $ 419,214 $ 445,486
Residential 581,167 453,469
Agtech 219,800 212,038
Infrastructure 84,626 82,662
Unallocated corporate assets 21,456 21,246
$ 1,326,263 $ 1,214,901

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	March 31, 2023		December 31, 2022
Total assets:
Renewables	$	393,088	$	392,368
Residential	535,423		519,567
Agtech	180,688		193,966
Infrastructure	82,795		80,264
Unallocated corporate assets	16,498		24,448

	$	1,208,492	$	1,210,613

The following tables illustrate segment revenue disaggregated by timing of transfer of control to the customer for the three ~~and nine~~ months ended ~~September 30~~March 31 (in thousands):


		Three Months Ended September 30, 2022											Three Months Ended March 31, 2023
		Renewables		Residential		Agtech		Infrastructure		Total			Renewables		Residential		Agtech		Infrastructure		Total
Net sales:	Net sales:											Net sales:
Point in Time	Point in Time	$	7,660	$	214,175	$	3,510	$	9,938	$	235,283	Point in Time	$	9,094	$	177,942	$	5,107	$	6,061	$	198,204
Over Time	Over Time	103,459		1,417		40,707		10,425		156,008		Over Time	50,111		1,553		30,745		12,654		95,063
Total net sales	Total net sales	$	111,119	$	215,592	$	44,217	$	20,363	$	391,291	Total net sales	$	59,205	$	179,495	$	35,852	$	18,715	$	293,267

Three Months Ended September 30, 2021
Renewables Residential Agtech Infrastructure Total
Net sales:
Point in Time $ 8,835 $ 170,280 $ 4,010 $ 8,194 $ 191,319
Over Time 121,327 1,265 44,965 10,477 178,034
Total net sales $ 130,162 $ 171,545 $ 48,975 $ 18,671 $ 369,353

Nine Months Ended September 30, 2022
Renewables Residential Agtech Infrastructure Total
Net sales:
Point in Time $ 18,569 $ 591,160 $ 9,152 $ 25,177 $ 644,058
Over Time 272,882 4,162 121,173 33,830 432,047
Total net sales $ 291,451 $ 595,322 $ 130,325 $ 59,007 $ 1,076,105

Nine Months Ended September 30, 2021
Renewables Residential Agtech Infrastructure Total
Net sales:
Point in Time $ 21,855 $ 472,277 $ 16,541 $ 25,301 $ 535,974
Over Time 301,570 3,694 132,869 31,227 469,360
Total net sales $ 323,425 $ 475,971 $ 149,410 $ 56,528 $ 1,005,334


	Three Months Ended March 31, 2022
	Renewables		Residential		Agtech		Infrastructure		Total
Net sales:
Point in Time	$	5,650	$	178,131	$	1,613	$	6,303	$	191,697
Over Time	73,133		1,354		40,815		10,866		126,168
Total net sales	$	78,783	$	179,485	$	42,428	$	17,169	$	317,865

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Certain information set forth herein includes statements that express our opinions, expectations, beliefs, plans, objectives, assumptions or projections regarding future events or future results and, therefore are, or may be deemed to be, “forward-looking statements.” These forward-looking statements can generally be identified by the use of forward-looking terminology, including the terms “believes,” “anticipates,” “aspires,” “expects,” “estimates,” “seeks,” “projects,” “intends,” “plans,” “may,” “will” or “should” or, in each case, their negative or other variations or comparable terminology. These forward-looking statements include all matters that are not historical facts. They include statements regarding our intentions, beliefs or current expectations concerning, among other things, our results of operations, financial condition, liquidity, prospects, growth, competition, strategies, margins, integration of acquired businesses, the industries in which we operate and the expected impact of evolving laws and regulation. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. We believe that these risks and uncertainties include, but are not limited to, those described in the “Risk Factors” disclosures in our most recent Annual Report on Form ~~10-K as updated in our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2022~~, ~~along with Item 1A of this Quarterly Report on Form 10-Q.~~10-K. Although we base these forward-looking statements on assumptions that we believe are reasonable when made, we caution you that forward-looking statements are not guarantees of future performance and that our actual results of operations, financial condition, liquidity and the development of the industries in which we operate may differ materially from those made in or suggested by the forward-looking statements contained herein. In addition, even if our results of operations, financial condition, liquidity, and the development of the industries in which we operate are consistent with the forward-looking statements contained in this Quarterly Report on Form 10-Q, those results or developments may not be indicative of results or developments in subsequent periods. Given these risks and uncertainties, you are cautioned not to place undue reliance on these forward-looking statements. Any forward-looking statements that we make herein speak only as of the date of those statements, and we undertake no obligation to update those statements or to publicly announce the results of any revisions to any of those statements to reflect future events or developments. Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance, unless expressed as such, and should only be viewed as historical data.

~~We use~~The Company uses certain operating performance measures, specifically consolidated gross margin, operating margin by segment and consolidated operating margin, to manage ~~our~~the Company's businesses, set operational goals, and establish performance targets for incentive compensation for ~~our~~the Company's employees. ~~We define~~The Company defines consolidated gross margin as a percentage of total consolidated gross profit to total consolidated net sales. ~~We define~~The Company defines operating margin by segment as a percentage of total income from operations by segment to total net sales by segment and consolidated operating margin as a percentage of total consolidated income from operations to total consolidated net sales. ~~We believe~~The Company believes consolidated gross margin, operating margin and consolidated operating margin may be useful to investors in evaluating the profitability of ~~our~~the Company's segments and the Company on a consolidated basis.

Overview

Gibraltar Industries, Inc. (the "Company") is a leading manufacturer and provider of products and services for the renewable energy, residential, agtech, and infrastructure markets.

The Company operates and reports its results in the following four reporting segments:

•Renewables;

•Residential;

•Agtech; and

•Infrastructure.

The Company serves customers primarily in North America including renewable energy (solar) developers, home improvement retailers, wholesalers, distributors, institutional and commercial growers of food and plants, and contractors. At ~~September 30, 2022, we~~March 31, 2023, the Company operated 3633 facilities, comprised of 2625 manufacturing facilities, ~~two~~one distribution ~~centers,~~center, and ~~eight~~seven offices, which are located in 15 states, Canada, China, and Japan. ~~Our~~The Company's operational infrastructure provides the necessary scale to support regional and national customers in each of ~~our~~the Company's markets.

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Recent Trends

The broader market dynamics over the past ~~two~~few years, ~~which have included the impact of COVID-19,~~ have resulted in impacts to ~~our company,~~the Company, including material cost inflation, labor availability issues and logistics costs increases. ~~We have~~The Company has also been impacted from supply constraints for materials and commodities used in ~~our~~its operations and from shortages in solar panels used by ~~our~~

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the Company's customers in conjunction with the goods and services ~~we provide.~~the Company provides. In certain instances these constraints have resulted in project delays, cost inflation and logistical delays. ~~We continue~~The Company continues to work with ~~our~~its customers and suppliers in this dynamic environment to better align pricing, understand the existing and potential future impacts to the supply chain, and make efforts to mitigate such ~~impacts as we expect~~impacts. The Company expects that some of these ~~supply chain~~dynamics will continue in 2023 and ~~labor availability pressures along with the~~could continue to have an impact ~~of inflation~~ on demand, material ~~cost,~~costs, labor and ~~logistics will continue throughout 2022.~~

logistics.

In early 2022, the U.S. Department of Commerce ("USDOC") was petitioned to investigate alleged circumvention of antidumping and countervailing duties on Chinese imports of solar panels produced in other countries in Southeast Asia. In March 2022, the USDOC announced that it would investigate the circumvention alleged in the petition. In June 2022, the President of the United States issued an Executive Order to suspend any tariffs that result from this investigation for two years. The USDOC has not yet issued a ruling to implement this order and the preliminary ruling, including any preliminary duty rates, which was initially expected in August 2022, but is currently delayed until November 2022. Furthermore, in June 2022, the Uyghur Forced Labor Prevention Act ("UFLPA") was enacted. The UFLPA requires traceability of components of imported goods to validate that the components are not sourced from areas in the Xinjiang region of China. ~~There are reports that up to three-gigawatts of~~This has caused solar panels ~~are being~~to be held at ~~U.S. customs until~~ the ~~importer~~border awaiting a determination that the panels do not contain components from Xinjiang. While a few of the historically significant suppliers have begun to have panels cleared for importation, the clearance is ~~able to prove where they have been sourced,~~still on a shipment-by-shipment basis, and ~~it is our understanding that these panels~~formal documentation requirements have not yet been ~~released by~~published. Some of the Company's larger customers have continued to shift sourcing to modules manufactured outside of China in efforts to clear U.S. ~~customs.~~customs more efficiently and ramp up the execution of solar projects.

In December 2022, the U.S. Department of Commerce ("USDOC") announced its preliminary ruling regarding the circumvention of antidumping and countervailing duties (“AD/CVD”) on Chinese imports of solar panels produced in four other countries in Southeast Asia. Four of eight major manufacturers across the four countries investigated were found to have been circumventing the AD/CVD orders. The findings are preliminary and further investigation is occurring with a final determination scheduled for August 17, 2023. Independent of the DOC’s final determination, the Presidential Proclamation issued in June 2022 provides that duties will not be collected on the imports from the impacted countries until June 2024. This provides U.S. solar importers time to adjust supply chains to ensure compliance with U.S. law. As the timing and progress of many of our customers’ projects depend upon the supply of solar panels, our operating results have been and could be impacted by these actions. We continue to work with customers who are assessing their ability to source panels needed to complete projects.

On August 16, 2022, the Inflation Reduction Act ("IRA") was signed into law. Among other things, the IRA provides for Investment Tax Credits ("ITC") for renewable energy. The IRA provides a 30% ITC for projects started prior January 29, 2023. Projects started on or after this date have the opportunity to claim the forthcoming issuance of guidance by the Department of the Treasury regarding new wage and apprenticeship standards. Sixty days after the issuance of such guidance the base ITC will be 6%, with an additional 24% available30% rate only if ~~the new labor standards are met or~~ the project is less than one ~~megawatt.~~megawatt or adheres to the new prevailing wage and apprenticeship requirements. Otherwise, these projects will default to a base rate of 6%. The IRA also provides the option to earn an additional 10% credit for domestic content, and separately, an additional 10% credit for siting a project in an “energy community.” Lastly, ~~there are~~under the IRA, Manufacturers Tax Credits ("MTC") that support clean energy manufacturing were established and expanded, and are available to suppliers of certain, specific solar tracker components, including mechanical parts and battery storage, that are made in the U.S. ~~We expect~~Final guidance is pending and expected to be issued by the ~~ITC to accrue to our downstream customers, solar investors,~~Department of Treasury over the course of 2023 for the domestic content, energy community, and ~~expect Manufacturers Tax Credits to accrue to~~MTC credits. The Company believes that these enhanced tax credits under the ~~Company's upstream suppliers. Both tax credits~~IRA will provide long-term certainty for the industry and should reduce policy driven demand swings for our products. ~~As provided for in the issued guidance relative to prevailing wage and sourcing provisions, we~~We will work with our customers to maximize the tax credits available to them.

Business Strategy

The Company's mission is to make life better for people and the planet, fueled by advancing the disciplines of engineering, science, and technology. The Company is innovating to reshape critical markets in sustainable power, comfortable and efficient living, and productive growing throughout North America. Furthermore, the Company strives to create compounding and sustainable value for ~~our~~its stockholders and ~~other~~ stakeholders with strong and relevant leadership positions in higher growth, profitable end markets focused on addressing some of the world's most challenging opportunities. The foundation of the Company's strategy is built on three core pillars: Business System, Portfolio Management, and Organization Development.

1.Business System reflects the necessary systems, processes, and management tools required to deliver consistent and continuous performance improvement, every day. ~~Our Business System~~The Company's business system is a critical enabler to grow, scale, and deliver ~~our~~its plans. ~~Our~~The Company's focus is on deploying effective tools to drive growth, improve operating performance, and develop the organization utilizing 80/20 and lean quote-to-cash initiatives along with digital systems for speed, agility and responsiveness. ~~Our~~The Business System pillar challenges existing operating paradigms, drives day-to-day performance, forces prioritization of resources, tests ~~our~~the Company's business models, and ~~brings focus to~~drives new product and services ~~development and~~ innovation.

2.Portfolio Management is focused on optimizing the Company’s business portfolio in higher growth markets with leadership positions while ensuring ~~our~~its financial capital and human resources are effectively and

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efficiently deployed to deliver sustainable, profitable growth while increasing ~~our~~its relevance with customers and

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shaping ~~our~~its markets. ~~For a description of recent portfolio management activities, see~~In 2022, the ~~actions described below~~Company acquired Quality Aluminum Products ("QAP") in the ~~Recent Developments section.~~

Residential segment and made the decision to divest its non-core Processing business within the Agtech segment to help achieve these objectives.

3.Organization Development drives the Company’s continuous focus on ensuring ~~we have~~it has the right design and structure to scale the organization in order to execute the Company’s plans and meet commitments. The Company aspires to make ~~our~~its place of work the "Best Place to Work", where we focus is on creating an environment for our people to have the best opportunity for success, continue to develop, grow and learn. At core of this pillar is the Company’s development process focused on helping employees reach their potential, improve performance, develop career roadmaps, identify ongoing education requirements, and respective succession plans. ~~We believe~~The Company believes doing so helps usit attract and retain the best people ~~so we can~~to execute ~~our~~its business plans.

~~We believe~~The Company believes the key elements of ~~our~~the Company's strategy have, and will continue to, enable usthe Company to respond timely to changes in the end markets ~~we serve,~~the Company serves, including the broader market dynamics experienced over the past two years. ~~We have~~The Company has and ~~expect~~expects to continue to examine the need for restructuring of ~~our~~the Company's operations, including consolidation of facilities, reducing overhead costs, curtailing investments in working capital, and managing ~~our~~the Company's business to generate incremental cash. ~~We believe our~~The Company believes its strategy enables usthe Company to respond to volatility in commodity and other input costs and fluctuations in customer demand, along with striving to maintain and improve margins. ~~We have~~The Company has used cash flows generated by these initiatives to minimize debt, improve ~~our~~the Company's liquidity position, invest in growth initiatives and return capital to ~~our~~the Company's shareholders through share repurchases. Overall, ~~we continue~~the Company continues to strive to achieve stronger financial results, make more efficient use of capital, and deliver higher stockholder returns.

Recent Developments

On December 8, 2022, the Company entered into a Credit Agreement (the "Credit Agreement"), and concurrently with entering into the Credit Agreement, the Company paid off all amounts owed under the Sixth Amended and Restated Credit Agreement dated as of January 24, 2019, which was terminated with no prepayment penalties. The Credit Agreement provides for a revolving credit facility and letters of credit in an aggregate amount equal to $400 million. The Company can request additional financing to increase the revolving credit facility to $700 million or enter into a term loan of up to $300 million subject to conditions set forth in the Credit Agreement. The Credit Agreement contains two financial covenants. As of March 31, 2023, the Company was in compliance with both financial covenants. The Credit Agreement terminates on December 8, 2027.

On August 22, 2022, the Company purchased all the issued and outstanding membership ~~interest~~interests of Quality Aluminum Products ("QAP"), a manufacturer of ~~aluminum and steel products including~~ soffit, fascia, trim coil, rain carrying products and aluminum siding for an aggregate purchase price of ~~$52.6 million, which may be adjusted for working capital adjustments and certain other adjustments provided for in the membership interest purchase agreement.~~$52.1 million. The acquisition of QAP was financed primarily through borrowings under the Company's revolving credit facility. The results of operations of QAP have been included in the Residential segment of the Company's consolidated financial statements from the date of acquisition.

In May 2022, the Company's Board of Directors authorized a share repurchase program of up to $200 million of the Company's issued and outstanding common stock. The program has a duration of three years, ending May 2, 2025. Repurchases may be made, from time to time, in amounts and at prices the Company deems appropriate, subject to market conditions, applicable legal requirements, debt covenants and other considerations. Any such repurchases may be executed using open market purchases, privately negotiated agreements or other transactions. The repurchase program may be suspended or discontinued at any time at the Company's discretion. As of ~~September 30, 2022,~~March 31, 2023, the Company has repurchased ~~1,333,453~~2,150,903 shares for an aggregate price of ~~$55.5~~$93.2 million under this repurchase program.

~~During the first quarter~~

Table of 2022, the Company committed to a plan to sell its processing equipment business, which is a business within the Company's Agtech reportable segment, as a result of its portfolio management strategy in order to focus its resources on the higher growth and more profitable growing business within the Agtech segment. The processing equipment business was classified as held for sale as of March 31, 2022 and remains under such classification as of September 30, 2022.

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During the first quarter of 2021, the Company sold its Industrial business which was previously included in the Company's Industrial and Infrastructure Products segment, now the Infrastructure segment, and was reported as discontinued operations as of December 31, 2020.

Results of Operations

Three Months Ended ~~September 30, 2022~~March 31, 2023 Compared to the Three Months Ended ~~September 30, 2021~~March 31, 2022

The following table sets forth selected results of operations data and its percentage of net sales for the three months ended ~~September 30~~March 31 (in thousands):

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2022 2021
Net sales $ 391,291 100.0 % $ 369,353 100.0 %
Cost of sales 296,735 75.8 % 286,101 77.5 %
Gross profit 94,556 24.2 % 83,252 22.5 %
Selling, general, and administrative expense 47,160 12.1 % 45,274 12.2 %
Income from operations 47,396 12.1 % 37,978 10.3 %
Interest expense 1,048 0.2 % 491 0.2 %
Other expense 363 0.1 % 72 0.0 %
Income before taxes 45,985 11.8 % 37,415 10.1 %
Provision for income taxes 11,690 3.0 % 9,561 2.6 %
Income from continuing operations 34,295 8.8 % 27,854 7.5 %
Loss from discontinued operations — 0.0 % (298) 0.0 %
Net income $ 34,295 8.8 % $ 27,556 7.5 %


	2023				2022
Net sales	$	293,267	100.0	%	$	317,865	100.0	%
Cost of sales	216,338		73.8	%	253,021		79.6	%
Gross profit	76,929		26.2	%	64,844		20.4	%
Selling, general, and administrative expense	47,559		16.2	%	43,649		13.7	%

Income from operations	29,370		10.0	%	21,195		6.7	%
Interest expense	1,491		0.5	%	485		0.2	%
Other (income) expense	(397)		(0.1)	%	153		0.0	%
Income before taxes	28,276		9.6	%	20,557		6.5	%
Provision for income taxes	7,177		2.4	%	5,101		1.6	%


Net income	$	21,099	7.2	%	$	15,456	4.9	%

The following table sets forth the Company’s net sales by reportable segment for the three months ended ~~September 30,~~March 31, (in thousands):

Impact of
2022 2021 Total
Change Acquisitions Portfolio Management Ongoing Operations
Net sales:
Renewables $ 111,119 $ 130,162 $ (19,043) $ — $ — $ (19,043)
Residential 215,592 171,545 44,047 11,461 — 32,586
Agtech 44,217 48,975 (4,758) — (1,499) (3,259)
Infrastructure 20,363 18,671 1,692 — — 1,692
Consolidated $ 391,291 $ 369,353 $ 21,938 $ 11,461 $ (1,499) $ 11,976


							Impact of
	2023		2022		Total Change		Acquisitions		Portfolio Management		Ongoing Operations
Net sales:
Renewables	$	59,205	$	78,783	$	(19,578)	$	—	$	—	$	(19,578)
Residential	179,495		179,485		10		14,266		—		(14,256)
Agtech	35,852		42,428		(6,576)		—		691		(7,267)
Infrastructure	18,715		17,169		1,546		—		—		1,546
Consolidated	$	293,267	$	317,865	$	(24,598)	$	14,266	$	691	$	(39,555)

Consolidated net sales ~~increased~~decreased by ~~$21.9~~$24.6 million, or ~~5.9%~~7.7%, to ~~$391.3~~$293.3 million for the three months ended ~~September 30, 2022~~March 31, 2023 compared to the three months ended ~~September 30, 2021.~~March 31, 2022. The ~~5.9% increase~~7.7% decrease in revenue was driven by a ~~3.2%~~$39.6 million or ~~$12.0 million increase~~12.4% decrease in organic revenue, ~~and 3.1%~~largely the result of a 14% volume decline, partially offset by a 1% increase ~~or $11.5~~in pricing to customers. Partially offsetting the year over year decrease were $14.3 million of revenues generated ~~from the acquisition of~~by QAP, which was acquired induring the third quarter of 2022 and reported as part of ~~our~~the Company's Residential segment. This increase was partially offset by a decline in revenues in the Company's processing business which was reclassified as held-for-sale as of March 31, 2022. The organic revenue growth in the Residential and Infrastructure segments more than offset volume declines in both our Renewables and Agtech segments. The improvement year over year was driven by a 11% increase in pricing to customers, partially offset by a net volume decline of 8%. The increase during the current year quarter was also driven by participation gains and price management in our Residential segment, partially offset by project delays caused by continuing end market supply chain challenges in the Agtech and Renewables segments. While the Company committed to a plan of sale of its Processing business within the Agtech segment, and has reclassified the assets and liabilities as held-for-sale as of March 31, 2022, the Company will continue reporting its operating results in the Company's consolidated operating results from continuing operations until the sale of the business is completed. Consolidated backlog decreased 7%18% to ~~$358~~$360 million down from ~~$385~~$437 million at the end of the prior year quarter.

Net sales in ~~our~~the Company's Renewables segment decreased ~~$19.0~~$19.6 million, or ~~14.7%~~24.9%, to ~~$111.1~~$59.2 million for the three months ended ~~September 30, 2022~~March 31, 2023 compared to ~~$130.2~~$78.8 million for the three months ended ~~September 30, 2021.~~March 31, 2022. Revenue ~~decreased in line with our expectations during the quarter~~declined as the ~~market~~ demand for solar panel installation continues to be impacted by panel importation challenges resulting from the UFLPA, which was implemented in June ~~2022, and a three-month delay by~~2022. Additionally, adverse winter weather conditions experienced in the ~~Department~~current year quarter impacted the scheduling of ~~Commerce for its preliminary ruling on its solar panel anti-dumping / countervailing duties ("AD/CVD") anti-circumvention investigation.~~projects. As a result, backlog decreased ~~9% year over~~20% from the prior year, however, ~~given~~ the ~~current conversations with our customers, we expect~~Company expects backlog to improve once ~~the DOC issues preliminary and then final order and~~ there is better understanding of ~~enforcement and~~documentary compliance requirements relative to the UFLPA.

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Net sales in ~~our~~the Company's Residential segment ~~increased 25.7%, or $44.0~~were flat at $179.5 million ~~to $215.6 million~~ for both the three months ended ~~September 30,~~March 31, 2023 and 2022, ~~compared to $171.5 million for the three months ended September 30, 2021.~~respectively. The ~~increase from the prior year quarter, the ninth consecutive quarter~~positive impact of ~~double-digit growth, was driven by price management,~~ participation gains ~~and market demand. Sales~~along with $14.3 million of sales generated ~~from~~by QAP, acquired in the third quarter of 2022, ~~also contributed $11.5 million or 6.7%~~offset headwinds of channel inventory correction, the market's return to normal seasonal demand, and adverse winter weather in key regions of the ~~increase.~~

U.S.

Net sales in ~~our~~the Company's Agtech segment decreased ~~9.8%~~15.3%, or ~~$4.8~~$6.6 million, to ~~$44.2~~$35.9 million for the three months ended ~~September 30, 2022~~March 31, 2023 compared to ~~$49.0~~$42.4 million for the three months ended ~~September 30, 2021. Excluding the impact of the processing equipment business which has been classified as held for sale as of~~ March 31, ~~2022, revenue~~2022. Revenue declined in ~~our~~

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the Company's produce ~~and cannabis~~ businesses as ~~projects shifted into~~customers re-scope and re-prioritize project launch of fruit and vegetable growing facilities. While the ~~fourth quarter and 2023, the result of continued licensing and permit delays. The commercial greenhouse business was relatively flat compared~~active project pipeline continues to ~~the prior year quarter. While quote activity remains robust,~~grow, backlog decreased 7%32% year over year.

Net sales in ~~our~~the Company's Infrastructure segment increased ~~9.1%~~8.7%, or ~~$1.7~~$1.5 million, ~~to $20.4 million for the three months ended September 30, 2022 compared~~ to $18.7 million for the three months ended ~~September 30, 2021.~~March 31, 2023 compared to $17.2 million for the three months ended March 31, 2022. The increase in revenue was due to continued solid market demand, ~~for non-fabricated products, and timing of project work. The business has strong bidding activity~~ which also resulted in an ~~11%~~38% increase in backlog year over year. Management expects continued positive ~~impact~~momentum from increased infrastructure spending related to the Infrastructure Investment and Jobs Act, ~~through the end of this year~~ and ~~into 2023.~~ongoing efforts to increase market participation.

~~Our~~The Company's consolidated gross margin increased to ~~24.2%~~26.2% for the three months ended ~~September 30, 2022~~March 31, 2023 compared to ~~22.5%~~20.4% for the three months ended ~~September 30, 2021.~~March 31, 2022. The increase was ~~largely the result of favorable price / cost management,~~driven by business mix, field operations productivity and ~~improved operating execution from lean enterprise initiatives,~~improvement in supply chain management and efficiencies along with continuing progress in the ~~impact of participation gains in our residential segment.~~Company's business operating system.

Selling, general, and administrative ("SG&A") expenses increased by ~~$1.9~~$3.9 million, or ~~4.2%~~9.0% to ~~$47.2~~$47.6 million for the three months ended ~~September 30, 2022~~March 31, 2023 compared to ~~$45.3~~$43.6 million for the three months ended ~~September 30, 2021.~~March 31, 2022. The ~~$1.9~~$3.9 million increase was the ~~net~~combined result of expenses associated with investing in our enterprise resource planning ("ERP") systems to simplify and digitize our businesses, along with transaction costs to complete the acquisition of QAP which closed during the quarter, partially offset by lowerhigher performance-based compensation expense as compared to the prior year, ~~quarter,~~ largely the result of equity-based awards in the Company's deferred compensation plan that are valued based on its 200-day average stock price, ~~Despite~~along with incremental SG&A expenses incurred by QAP, acquired in the ~~above increases,~~third quarter of 2022. SG&A expenses as a percentage of net sales ~~modestly decreased~~increased to ~~12.1%~~16.2% for the three months ended ~~September 30, 2022~~March 31, 2023 compared to ~~12.2%~~13.7% for the three months ended ~~September 30, 2021.~~March 31, 2022.

The following table sets forth the Company’s income from operations and income from operations as a percentage of net sales by reportable segment for the three months ended ~~September 30,~~March 31, (in thousands):


												Impact of															Impact of
		2022				2021				Total Change		Portfolio Management		Ongoing Operations			2023				2022				Total Change		Portfolio Management		Ongoing Operations
Income from operations:	Income from operations:															Income from operations:
Renewables	Renewables	$	14,216	12.8	%	$	12,206	9.4	%	$	2,010	$	—	$	2,010	Renewables	$	2,269	3.8	%	$	(6,984)	(8.9)	%	$	9,253	$	—	$	9,253
Residential	Residential	35,802		16.6	%	29,482		17.2	%	6,320		—		6,320		Residential	29,509		16.4	%	33,435		18.6	%	(3,926)		—		(3,926)
Agtech	Agtech	3,777		8.5	%	2,227		4.5	%	1,550		906		644		Agtech	2,330		6.5	%	31		0.1	%	2,299		1,890		409
Infrastructure	Infrastructure	2,572		12.6	%	1,640		8.8	%	932		—		932		Infrastructure	2,714		14.5	%	1,181		6.9	%	1,533		—		1,533
Unallocated Corporate Expenses	Unallocated Corporate Expenses	(8,971)		(2.3)	%	(7,577)		(2.1)	%	(1,394)		—		(1,394)		Unallocated Corporate Expenses	(7,452)		(2.5)	%	(6,468)		(2.0)	%	(984)		—		(984)
Consolidated income from operations	Consolidated income from operations	$	47,396	12.1	%	$	37,978	10.3	%	$	9,418	$	906	$	8,512	Consolidated income from operations	$	29,370	10.0	%	$	21,195	6.7	%	$	8,175	$	1,890	$	6,285

The Renewables segment generated an operating margin of ~~12.8%~~3.8% in the current year quarter compared to ~~9.4%~~(8.9)% in the prior year quarter. The increase in operating margin was driven by ~~improved project management, favorable alignment of material costs to customer selling prices and~~ field operations ~~efficiencies. During~~productivity and improved supply chain management that offset lower volumes, along with restructuring costs recorded in the ~~quarter, the segment completed the implementation of a common platform for its ERP system. Execution of other integration plans, such as in-sourcing production, remain on track.~~

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prior year quarter.

The Residential segment generated an operating margin of ~~16.6%~~16.4% in the current year quarter compared to ~~17.2%~~18.6% in the prior year quarter. ~~While~~The decrease in operating ~~profit increased $6.3 million as compared~~margin was the result of expected compression in price to ~~the prior year quarter, margin decreased due to~~material cost alignment and the anticipated lower margins from ~~our~~the Company's recent acquisition of QAP. ~~We expect QAP~~The Company expects margins to improve as ~~we continue to integrate it operationally through 80/20 initiatives.~~seasonal volume accelerates, price / material cost are better aligned, and QAP integration benefits are realized.

~~Our~~The Agtech segment generated an operating margin of ~~8.5%~~6.5% in the current year quarter compared to ~~4.5%~~0.1% in the prior year quarter. Operating margin improved year over year, the result of business mix, ~~price / cost management,~~improvement in its business operating system, along with supply chain ~~improvement~~productivity and ~~80/20 initiatives.~~efficiency improvement.

~~Our~~The Infrastructure segment generated an operating margin of ~~12.6%~~14.5% during the three months ended ~~September 30, 2022~~March 31, 2023 compared to ~~8.8%~~6.9% during the three months ended ~~September 30, 2021.~~March 31, 2022. The margin improved year over year driven by ~~favorable alignment of material costs to pricing,~~strong operating execution, volume leverage, ~~positive mix~~ and ~~improved operating execution.~~

supply chain productivity.

Unallocated corporate expenses increased ~~$1.4~~$1.0 million from ~~$7.6~~$6.5 million during the three months ended ~~September 30, 2021~~March 31, 2022 to ~~$9.0~~$7.5 million during the three months ended ~~September 30, 2022.~~March 31, 2023. The increase in expense was primarily the

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result of expenses associated with investing in our ERP systems to simplify and digitize our businesses as compared to the prior year quarter along with transaction costs to complete the acquisition of QAP which closed during the quarter. These increases were partially offset by lowerhigher performance-based compensation expense for equity-based awards in the Company's deferred compensation plan that are valued based on its 200-day average stock price as compared to the prior year quarter.

Interest expense increased year over year with ~~$1.0~~$1.5 million for the three months ended ~~September 30, 2022~~March 31, 2023 compared to $0.5 million for the three months ended ~~September 30, 2021.~~March 31, 2022. The increase in expense was due to both higher interest rates compared to the prior year quarter along with higher outstanding balances on the Company's revolving credit facility during the ~~quarter along with higher interest rates compared to the prior year~~ quarter. The outstanding balances on the Company's revolving credit facility were ~~$121.8~~$49.9 million and ~~$59.7~~$42.4 million as of ~~September 30,~~March 31, 2023, and 2022, ~~and 2021,~~ respectively.

The Company recorded other ~~expense~~income of $0.4 million for the three months ended ~~September 30, 2022,~~March 31, 2023, compared to ~~the $0.1~~other expense of $0.2 million recorded for the three months ended ~~September 30, 2021.~~March 31, 2022. The ~~increase in expense from the prior~~change year ~~quarter was~~over year is primarily the result of foreign currency translation fluctuations.

WeThe Company recognized a provision for income taxes of ~~$11.7~~$7.2 million and ~~$9.6~~$5.1 million, with effective tax rates of 25.4% and ~~25.6%~~24.8% for the three months ended ~~September 30,~~March 31, 2023, and 2022, ~~and 2021,~~ respectively. The effective tax rate for the three months ended September 30, 2022, and 2021, respectively, was greater than the U.S. federal statutory rate of 21% due to state taxes and nondeductible permanent differences. Furthermore, the increase in provision during the three months ended September 30, 2021 period was partially offset by an excess tax benefit on stock-based compensation.

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~~Nine Months Ended September 30, 2022 Compared to the Nine Months Ended September 30, 2021~~

~~The following table sets forth selected results of operations data and its percentage of net sales for the nine months ended September 30 (in thousands):~~

2022 2021
Net sales $ 1,076,105 100.0 % $ 1,005,334 100.0 %
Cost of sales 826,434 76.8 % 781,133 77.7 %
Gross profit 249,671 23.2 % 224,201 22.3 %
Selling, general, and administrative expense 140,941 13.1 % 141,999 14.1 %
Income from operations 108,730 10.1 % 82,202 8.2 %
Interest expense 2,189 0.2 % 1,180 0.1 %
Other expense (income) 797 0.1 % (4,279) (0.4) %
Income before taxes 105,744 9.8 % 85,301 8.5 %
Provision for income taxes 26,686 2.5 % 20,578 2.1 %
Income from continuing operations 79,058 7.3 % 64,723 6.4 %
Income from discontinued operations — 0.0 % 1,544 0.2 %
Net income $ 79,058 7.3 % $ 66,267 6.6 %

~~The following table sets forth the Company’s net sales by reportable segment for the nine months ended September 30, (in thousands):~~

Impact of
2022 2021 Total
Change Acquisitions Portfolio Management Ongoing Operations
Net sales:
Renewables $ 291,451 $ 323,425 $ (31,974) $ — $ — $ (31,974)
Residential 595,322 475,971 119,351 11,461 — 107,890
Agtech 130,325 149,410 (19,085) — (9,165) (9,920)
Infrastructure 59,007 56,528 2,479 — — 2,479
Consolidated $ 1,076,105 $ 1,005,334 $ 70,771 $ 11,461 $ (9,165) $ 68,475

Consolidated net sales increased by $70.8 million, or 7.0%, to $1.1 billion for the nine months ended September 30, 2022 compared to the nine months ended September 30, 2021. The 7.0% increase in revenue was driven by a 6.8% or $68.5 million increase in organic revenue along with a 1.1% or $11.5 million generated from the acquisition of QAP this quarter in the Residential segment. The increase was partially offset by a decline in revenue in the Company's processing business which was reclassified as held-for-sale as of March 31, ~~2022. The organic revenue growth in the Residential~~2023, and Infrastructure segments more than offset volume declines in both our Renewables and Agtech segments. This net improvement year over year was driven by a 13% increase in pricing to customers, partially offset by a net volume decline of 7%. The increase in net sales during the current year was also driven by price management and participation gains in our Residential segment, partially offset by continued project delays caused by supply chain challenges in the Agtech and Renewables segments. While the Company committed to a plan of sale of its Processing business within the Agtech segment, and has reclassified the assets and liabilities as held-for-sale as of March 31, 2022, the Company will continue reporting its operating results in the Company's consolidated operating results from continuing operations until the sale of the business is completed. Consolidated backlog decreased 7% to $358 million down from $385 million at the end of the prior year period.

Net sales in our Renewables segment decreased $32.0 million, or 9.9%, to $291.5 million for the nine months ended September 30, 2022 compared to $323.4 million for the nine months ended September 30, 2021. Revenue decreased as anticipated by 9.9% during the current year as the market demand for solar panel installation continues to be impacted by the UFLPA, which was implemented in June 2022, and a three-month delay by the Department of Commerce for its preliminary ruling on its solar panel AD/CVD anti-circumvention investigation. As a result, backlog decreased 9% year over year, however, given the current conversations with our customers, we

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~~expect backlog to improve once the DOC issues preliminary and then final order and there is better understanding of enforcement and compliance relative to the UFLPA.~~

Net sales in our Residential segment increased 25.1%, or $119.4 million, to $595.3 million for the nine months ended September 30, 2022 compared to $476.0 million for the nine months ended September 30, 2021. The increase from the prior year was primarily driven by pricing actions, along with participation gains and increased market demand. Sales generated from QAP, acquired in the third quarter of 2022, also contributed $11.5 million or 2.4% to the increase.

Net sales in our Agtech segment decreased 12.8%, or $19.1 million, to $130.3 million for the nine months ended September 30, 2022 compared to $149.4 million for the nine months ended September 30, 2021. Excluding the impact of the processing equipment business which has been classified as held for sale as of March 31, 2022, revenue declined $9.9 million as our produce and cannabis businesses due to project delays, the result of continued licensing and permit delays. Despite these headwinds, the commercial greenhouse business continued solid growth across its core product lines. While quote activity remains robust, backlog decreased 7% year over year.

Net sales in our Infrastructure segment increased 4.4%, or $2.5 million, to $59.0 million for the nine months ended September 30, 2022 compared to $56.5 million for nine months ended September 30, 2021. The increase in revenue was driven by growth in demand for fabricated products with strong bidding activity which resulted in an 11% increase in backlog year over year. Management expects continued positive impact from the increased infrastructure spending related to the Infrastructure Investment and Jobs Act through the end of this year and into 2023.

Our consolidated gross margin increased to 23.2% for the nine months ended September 30, 2022 compared to 22.3% for the nine months ended September 30, 2021. The increase was primarily the result of favorable price / cost management and favorable revenue mix and improved operating execution from lean enterprise initiatives along with participation gains in our residential segment. These actions more than offset the impacts of supply chain challenges and severe weather which were experienced in the early part of the year that resulted in increased costs due to project disruptions.

SG&A expenses as a percentage of net sales decreased to 13.1% for the nine months ended September 30, 2022 compared to 14.1% for the nine months ended September 30, 2021. The decrease of $1.1 million, or 0.7%, to $140.9 million for the current year period compared to $142.0 million for the prior year period was primarily due to lower performance-based compensation expense for equity-based awards in the Company's deferred compensation plan that are valued based on its 200-day average stock price. This increase was partially offset by higher expenses associated with investing in our ERP systems to simplify and digitize our businesses as compared to the prior year.

The following table sets forth the Company’s income from operations and income from operations as a percentage of net sales by reportable segment for the nine months ended September 30, (in thousands):

Impact of
2022 2021 Total
Change Portfolio Management Ongoing Operations
Income from operations:
Renewables $ 14,061 4.8 % $ 21,195 6.6 % $ (7,134) $ — $ (7,134)
Residential 104,901 17.6 % 79,571 16.7 % 25,330 — 25,330
Agtech 5,350 4.1 % 4,133 2.8 % 1,217 (1,426) 2,643
Infrastructure 6,640 11.3 % 7,863 13.9 % (1,223) — (1,223)
Unallocated Corporate Expenses (22,222) (2.1) % (30,560) (3.0) % 8,338 — 8,338
Consolidated income from operations $ 108,730 10.1 % $ 82,202 8.2 % $ 26,528 $ (1,426) $ 27,954

The Renewables segment generated an operating margin of 4.8% in the current year period compared to 6.6% in the prior year period. The decrease in operating margin on lower volume was the result of project management

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inefficiencies related to project delays and disruptions associated with market supply chain challenges and prolonged inflation on structural steel used in solar canopy projects in the earlier part of the year. Improved project management, favorable alignment of material costs to customer selling prices and field operations efficiencies beginning in May and sustained through the current period is largely offsetting the challenges experienced at the beginning of the year. Execution of integration plans, such as in-sourcing production, remain on track.

The Residential segment generated an operating margin of 17.6% in the current year period compared to 16.7% in the prior year period. The increase in operating margin was the result of favorable price / cost management, segment mix, labor management, volume leverage and 80/20 initiatives. During the year, we completed the implementation a new ERP system in the mail and package business.

Our Agtech segment generated an operating margin of 4.1% in the current year period compared to 2.8% in the prior year period. Excluding the impact of the Processing business which has been classified as held for sale as of March 31, 2022, operating profit and margin improved year over year as a result of improved business mix, price / cost management, continued execution from 80/20 and lean enterprise initiatives and ongoing integration activities.

Our Infrastructure segment generated an operating margin of 11.3% in the current year period compared to 13.9% during the prior year period. The margin declined year over year due to the impact of plate steel inflation on fixed price and was partially offset by improving operating execution.

Unallocated corporate expenses decreased $8.3 million from $30.6 million during the nine months ended September 30, 2021 to $22.2 million during the nine months ended September 30, 2022. The decrease in expense was largely the result of lower performance-based compensation expense for equity-based awards in the Company's deferred compensation plan that are valued based on its 200-day average stock price as compared to the prior year.

Interest expense increased year over year with $2.2 million for the nine months ended September 30, 2022 compared to $1.2 million for the nine months ended September 30, 2021. The increase in expense was primarily due to higher outstanding balances on the Company's revolving credit facility during the current year along with higher interest rates compared to the prior year period. The outstanding balances on the Company's revolving credit facility were $121.8 million and $59.7 million as of September 30, 2022, and 2021, respectively.

The Company recorded other expense of $0.8 million for the nine months ended September 30, 2022, compared to other income of $4.3 million for the nine months ended September 30, 2021. The change from income in the prior year to expense in the current year was primarily the result of the $4.7 million gain recognized on the sale of securities received from the sellers of Thermo Energy Systems, Inc. ("Thermo") to settle indemnification claims recorded in the prior year.

We recognized a provision for income taxes of $26.7 million and $20.6 million, with effective tax rates of 25.2% and 24.1% for the nine months ended September 30, 2022, and 2021, respectively. The effective tax rate for the nine months ended September 30, 2022, and 2021, respectively, was greater than the U.S. federal statutory rate of 21% due to state taxes and nondeductible permanent differences partially offset by ~~an excess tax benefit on stock-based compensation.~~favorable discrete items.

Liquidity and Capital Resources

The following table sets forth ~~our~~the Company's liquidity position as ~~of:~~of (in thousands):

(in thousands) September 30, 2022 December 31, 2021
Cash and cash equivalents $ 21,919 $ 12,849
Availability on revolving credit facility 273,205 369,305
$ 295,124 $ 382,154

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	March 31, 2023		December 31, 2022
Cash and cash equivalents	$	7,497	$	17,608
Availability on revolving credit facility	343,655		304,505
	$	351,152	$	322,113

Sources of Liquidity

~~We believe that our~~The Company's sources of liquidity are comprised of cash on hand and available borrowing capacity provided under ~~our~~the Company's Credit Agreement (the "Credit Agreement"), entered into on December 8, 2022. This Credit Agreement replaced and paid off all amounts owed under the Sixth Amended and Restated Credit Agreement ~~(the "Senior~~dated as of January 24, 2019. The Credit ~~Agreement")~~Agreement maintains similar capacity as the prior agreement in which it provides for a revolving credit facility and letters of credit in an aggregate amount equal to $400 million. The Company can request additional financing to increase the revolving credit facility to $700 million or enter into a term loan of up to $300 million subject to conditions set forth in the Credit Agreement. The Company believes that these sources provide usthe Company with ample liquidity and capital resources to invest in ~~key business strategies that drive our mission. We have~~operational excellence, growth initiatives and the development of the organization.

The Company has been able to weather the economic impacts of the broader market dynamics, including the ~~current~~ inflationary cost environment, while continuing to make investments that support ~~our~~the Company's strategy. ~~We continue~~The Company continues to remain focused on managing ~~our~~its working capital, closely monitoring customer credit and collection activities, and working to extend payment ~~terms. We believe our~~terms with its vendors. The Company believes its liquidity, together with the cash expected to be generated from operations, should be sufficient to fund working capital needs and ~~to invest in operational excellence,~~ growth initiatives ~~and stock repurchases~~ for the foreseeable future.

~~We use our Senior~~The Company uses the Credit Agreement to provide liquidity and capital resources primarily for ~~our~~the Company's U.S. operations. ~~Historically, our~~Generally, the Company's foreign operations have generated cash flow from operations sufficient to invest in working capital and fund their capital improvements. As of ~~September 30,~~March 31, 2023 and December 31, 2022, ~~our~~the Company's foreign subsidiaries held ~~$15.7~~$7.5 million and $15.2 million of ~~cash.~~cash, respectively.

Outstanding balances on ~~our~~the Company's revolving credit facility under ~~our Senior~~the Company's Credit Agreement accrue interest at a rate, ~~based on LIBOR~~at the Company's option, equal to the applicable margin plus ~~an additional margin. We do not expect~~(a) a ~~material change in interest expense as~~base rate, (b) a ~~result of transitioning from~~daily simple secured overnight financing rate ("SOFR"), (c) a ~~LIBOR~~term SOFR rate, toor (d) for certain foreign currencies, a ~~new reference~~foreign currency rate. See Note 8 to the Company's consolidated financial statements in Part I, Item 1, Financial Statements, of this Quarterly Report on Form 10-Q for further information on the Company’s ~~Senior~~ Credit ~~Agreement~~.

Agreement.

Uses of Cash / Cash Requirements

~~Our~~The Company's material short-term cash requirements primarily include accounts payable, certain employee and retiree benefit-related obligations, operating lease obligations, interest payments on outstanding debt, repayments

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of borrowing on ~~our~~its revolving credit facility, capital expenditures, and other purchase obligations originating in the normal course of business for inventory purchase orders and contractual service agreements. ~~Our~~The Company's principal capital requirements are to fund ~~our~~its operations' working capital and capital improvements, toas well as provide capital for acquisitions and to strategically allocate capital through repurchases of Company stock. WeThe Company will continue to invest in growth opportunities as appropriate while focusing on working capital efficiency and profit improvement opportunities to minimize the cash invested to operate ~~our~~its business. ~~We intend~~The Company intends to fund ~~our~~its cash requirements through cash generated from operations and, as necessary, from the availability on ~~our~~its revolving credit facility.

~~During 2020, we opted to defer remittance~~program, including 153,537 shares repurchased for an aggregate price of $7.4 million during the employer portion of Social Security tax as provided in the Coronavirus, Aid, Relief and Economic Security Act ("CARES Act"), which allowed us to retain $4.4 million in cash during 2020 that would have otherwise been remitted to the federal government. The deferred tax payments were required to be repaid in two installments occurring near the end of each year 2021 and 2022, of which $1.9 million was repaid in 2021 and the remaining $2.5 million will be repaid by the end of 2022.

three months ended March 31, 2023.

Over the long-term, ~~we expect~~the Company expects that future investments, including strategic business opportunities such as acquisitions, may be financed through a number of sources, including internally available cash, availability under ~~our Senior~~the Credit Agreement, new debt financing, the issuance of equity securities, or any combination of the above. The $52.6 million preliminary purchase price for the acquisition of QAP was financed primarily through borrowing on our revolving credit facility. Additional cash payments may be required for customary adjustments related to QAP's net working capital and certain other adjustments as provided for in the membership interest purchase agreement.aforementioned. All potential acquisitions are evaluated based on ~~our~~the Company's acquisition strategy, which includes the enhancement of ~~our~~the Company's existing products, operations, and/or capabilities, as well as expanding ~~our~~the Company's access to new products, markets, and customers, with the goal of creating compounding and sustainable stockholder value.

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These expectations are forward-looking statements based upon currently available information and may change if conditions in the credit and equity markets deteriorate or other circumstances change. To the extent that operating cash flows are lower than ~~expected~~current levels, or sources of financing are not available or not available at acceptable terms, ~~our~~the Company's future liquidity may be adversely affected.

Except as disclosed above, there have been no material changes in ~~our~~the Company's cash requirements since December 31, ~~2021,~~2022, the end of fiscal year ~~2021.~~2022. See Part II, Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations" in ~~our~~the Company's Annual Report on Form 10-K for the year ended December 31, ~~2021.~~

2022.

Cash Flows

The following table sets forth selected cash flow data for the ~~nine~~three months ended ~~September 30,~~March 31, (in thousands):

2022 2021
Cash provided by (used in):
Operating activities of continuing operations $ 38,561 $ (14,523)
Investing activities of continuing operations (67,325) 28,954
Financing activities of continuing operations 39,675 (30,276)
Discontinued operations — (2,178)
Effect of foreign exchange rate changes (1,841) (97)
Net increase (decrease) in cash and cash equivalents $ 9,070 $ (18,120)


	2023		2022
Cash provided by (used in):
Operating activities	$	38,045	$	(7,754)
Investing activities	(1,636)		(4,402)
Financing activities	(46,509)		15,039

Effect of foreign exchange rate changes	(11)		(159)
Net (decrease) increase in cash and cash equivalents	$	(10,111)	$	2,724

Operating Activities

Net cash provided by operating activities ~~of continuing operations~~ for the ~~nine~~three months ended ~~September 30,~~March 31, 2023 of $38.0 million consisted of net income of $21.1 million, non-cash net charges totaling $9.3 million, which include depreciation, amortization, stock-based compensation, exit activity recoveries and other non-cash charges, and $7.6 million of cash generated from working capital and other net assets. The cash generated from working capital and other net assets was due to an increase in accounts payable as a result of the timing of purchases and vendor payments, offset by an increase in accounts receivable as revenues increased in the latter part of the quarter.

Net cash used in operating activities for the three months ended March 31, 2022 of ~~$38.6~~$7.7 million consisted of income from continuing operations of ~~$79.1~~$15.5 million and non-cash net charges totaling ~~$30.3~~$10.3 million, which include

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depreciation, amortization, ~~stock-based~~stock compensation, exit activity costs and other non-cash charges, offset by a ~~$70.8~~$33.5 million investment in working capital and other net assets. The investment in working capital and other net assets was due to increases in inventory as a result of provisioning for potential supply chain disruptions and raw material and freight costs, along with an increase in accounts receivable ~~and inventory, largely~~as the result of seasonal increases in demand ~~holding increased quantities due to general supply chain disruption, along with increased raw material~~ and ~~freight costs impacting inventory. A~~a decrease ~~in accounts payable as a result of the correlation between the timing of inventory receipts and vendor payments also contributed to the increase.~~

Net cash used in operating activities of continuing operations for the nine months ended September 30, 2021 of $14.5 million consisted of income from continuing operations of $64.7 million and non-cash net charges totaling $32.6 million, which include depreciation, amortization, stock-based compensation, exit activity costs and other non-cash charges, offset by a $111.8 million investment in working capital and other net assets. The investment in net working capital and other net assets was largely driven by an increase in inventory due to rising material costs and provisioning for potential supply chain disruptions along with accounts receivable due to seasonal increases in demand, offset by an increase in accounts payable as the result of ~~seasonal increases~~timing of vendor payments. This was offset by an increase in ~~manufacturing activity.~~

accrued expenses and other non-current liabilities due to an increase in unbilled project revenues.

Investing Activities

Net cash used in investing activities ~~of continuing operations~~ for the ~~nine~~three months ended ~~September 30, 2022~~March 31, 2023 of ~~$67.3 million consisted of net cash paid of $51.6 million for the acquisition of QAP and capital expenditures of $15.7 million.~~

~~Net cash provided by investing activities of continuing operations for the nine months ended September 30, 2021 of $29.0~~$1.6 million was primarily due to ~~$38.1~~capital expenditures of $2.2 million, ~~in net proceeds received from the sale of the Company's Industrial business and~~offset by receipt of the ~~$4.1~~$0.6 million final working capital settlement resulting from the ~~2020~~2022 acquisition of ~~TerraSmart, offset by~~QAP.

Net cash used in investing activities for the three months ended March 31, 2022 of $4.4 million was primarily due to capital expenditures of ~~$13.3~~$4.4 million.

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Financing Activities

Net cash ~~provided by~~used in financing activities ~~of continuing operations~~ for the ~~nine~~three months ended ~~September 30,~~March 31, 2022 of ~~$39.7~~$46.5 million ~~was the result~~consisted of ~~$197.8~~net long-term debt payments of $39.0 million and $7.5 million of common stock repurchases. Net long-term debt payments consisted of $50.0 million in long-term debt payments, offset by $11.0 million in proceeds from borrowing on ~~our long-term credit facility, offset by $100.0 million in payments on~~the Company's long-term debt ~~and $58.1 million of common stock repurchases. Share repurchases of 1,333,453~~credit facility. The Company repurchased 153,537 shares under the ~~Company’s recently~~Company's authorized share repurchase program which totaled ~~$55.5~~$5.6 million paid during the three months ended March 31, 2023 with the balance repurchased ~~for~~common stock of $1.9 million related to the net settlement of tax obligations for participants in the Company's equity incentive plans.

Net cash ~~used in~~provided by financing activities ~~of continuing operations~~ for the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 of ~~$30.3~~$15.0 million was ~~primarily~~ the result of ~~$83.6~~$47.5 million in proceeds from borrowing on the Company's long-term credit facility, offset by $29.0 million in payments on long-term debt and ~~$6.2~~$3.5 million of common stock repurchases related to the net settlement of tax obligations for participants in the Company's equity incentive ~~plans, offset by $58.5 million in proceeds from borrowing on our long-term credit facility and $1.0 million from the issuance of common stock from stock option exercises during the period.~~plans.

Critical Accounting Estimates

There have been no material changes to ~~our~~the Company's critical accounting estimates during the ~~nine~~three months ended ~~September 30, 2022~~March 31, 2023 from those disclosed in the consolidated financial statements and accompanying notes contained in the Company's Annual Report on Form 10-K for the year ended December 31, ~~2021.~~2022.

Recent Accounting Pronouncements

See Note 2 to the Company's consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q for further information on recent accounting pronouncements.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

In the ordinary course of business, the Company is exposed to various market risk factors, including changes in general economic conditions, competition, interest rates, foreign exchange rates, and raw materials pricing and availability. In addition, the Company is exposed to other financial market risks, primarily related to its foreign operations. In the current year, there have been no material changes in the information provided under Item 7A in the Company's Annual Report on Form 10-K for the year ended December 31, ~~2021.~~

2022.

Item 4. Controls and Procedures

(a)Evaluation of Disclosure Controls and Procedures

The Company maintains a system of disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended). Management of the Company, under the supervision and with the participation of the Chief Executive Officer and the Chief Financial Officer, evaluated the effectiveness of the Company’s disclosure controls and procedures as of the end of the period covered in this report. Based upon that evaluation and the definition of disclosure controls and procedures contained in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that as of the end of such period the Company’s disclosure controls and procedures were effective.

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(b)Changes in Internal Control over Financial Reporting

We implemented a new Enterprise Resource Planning (“ERP”) system for one of our operating units in our Renewables segment during the quarter ended September 30, 2022. The implementation of this ERP system is expected to, among other things, improve user access security and automate a number of accounting and reporting processes and activities, thereby decreasing the amount of manual processes previously required. Also, the Company acquired Quality Aluminum Products ("QAP") on August 22, 2022. This completed acquisition will be excluded from management's annual report on internal control over financial reporting for the year ending December 31, 2022.

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~~Except for the implementation of the new ERP system and the acquisition of QAP, there~~There have been no changes in the Company’s internal control over financial reporting (as defined by Rule 13a-15(f) or 15d-15(f) under the Securities Exchange Act of 1934, as amended) that occurred during the period covered by this Quarterly Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

~~We are subject to litigation from~~From time to time the Company has been and may in the future become involved in litigation, as well as other legal proceedings in the ordinary course of ~~business, however, there is no current material pending litigation to which we are a party and no material legal proceedings were terminated, settled, or otherwise resolved during~~ the ~~three months ended September 30, 2022, other than ordinary, routine litigation incidental to its~~Company's business. The Company maintains liability insurance against risks arising out of the normal course of business. While the outcome of these legal proceedings cannot be predicted with certainty, the Company's management, based on currently available facts, does not believe that the ultimate outcome of any pending litigation will have a material effect on the Company's consolidated financial condition, results of operations, or liquidity.

There were no material legal proceedings terminated, settled, or otherwise resolved during the three months ended March 31, 2023.

Item 1A. Risk Factors

In addition to the other information set forth in this report, you should carefully consider the risks discussed in “Part I, Item 1A. Risk Factors” in ~~our~~the Company's Annual Report on Form 10-K for the fiscal year ended December 31, ~~2021 and in our Form 10-Q for the quarterly period ended March 31,~~ 2022. These risks and uncertainties have the potential to materially affect ~~our~~the Company's business, financial condition, results of operation, cash flows, and future prospects. Additional risks and uncertainties not currently known to usthe Company or that wethe Company currently ~~deem~~deems immaterial may materially adversely impact ~~our~~the Company's business, financial condition, or operating results. During the quarter ended ~~September 30, 2022,~~March 31, 2023, there have been no material changes from the risk factors previously disclosed in ~~our~~the Company's Annual Report on Form 10-K for the fiscal year ended December 31, ~~2021 as amended by the risk factors disclosed in our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2022, respectively, except as follows.~~

~~Macroeconomic factors outside of our control may adversely affect our business, our industry, and the businesses and industries of many of our customer and suppliers.~~

Macroeconomic factors have a significant impact on our business, customer demand and the availability of credit and other capital, affecting our ability to generate profitable margins. Our operations are subject to the effects of domestic and international economic conditions, including global industrial production rates, inflation, deflation, interest rates, availability of capital, debt levels, consumer spending, energy availability, commodity prices, and the effects of governmental initiatives to manage economic conditions, including government monetary and trade policies, tax laws and regulations. Tariffs placed on imported products used by our customers, such as solar panels, could impact cost and availability of these products to our customers which could impact the demand for our products or services. In addition, fluctuations in the U.S. dollar impact the prices we charge and costs we incur to export and import products. We are unable to predict the impact on our business of changes in domestic and international economic conditions. We currently face challenging market conditions, and domestic or global economies, or certain industry sectors of those economies that are key to our sales, may further deteriorate, which could result in a corresponding decrease in demand for our products and negatively impact our results of operations and financial condition.

In addition, the United States currently imposes antidumping and countervailing duties on certain imported solar panels and components from certain countries in Southeast Asia. The antidumping and countervailing duties can change over time pursuant to annual reviews conducted by the U.S. Department of Commerce ("USDOC"), and a change in duty rates could have an adverse impact on our operating results. In early 2022, the USDOC was petitioned to investigate alleged circumvention of antidumping and countervailing duties on Chinese imports of solar panels and components produced in other countries in Southeast Asia. In March 2022, the USDOC announced that it would investigate the circumvention alleged in the petition which is still ongoing at this time. Furthermore, in June 2022, the Uyghur Forced Labor Prevention Act ("UFLPA") was enacted. The UFLPA requires traceability of components of imported goods to validate that the components are not sourced from areas in the Xinjiang region of China, which may be held at U.S. customs until the importer is able to prove where they have been sourced. As the timing and progress of many of our customers’ projects depend upon the supply of solar panels and components, our operating results could be adversely impacted by any negative circumvention determinations made by the USDOC and timing of review by U.S. customs.2022.

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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

In May 2022, the Company's Board of Directors authorized a share repurchase program of up to $200 million of the Company's issued and outstanding common stock. The program was publicly announced on May 4, 2022 and has a duration of three years, ending May 2, 2025. Repurchases may be made, from time to time, in amounts and at prices the Company deems appropriate, subject to market conditions, applicable legal requirements, debt covenants and other considerations. Any such repurchases may be executed using open market purchases, privately negotiated agreements or other transactions. The repurchase program may be suspended or discontinued at any time at the Company's discretion.

The following table sets forth purchases made by or on behalf of the Company during the quarter ended ~~September 30, 2022.~~March 31, 2023.

Issuer Purchases of Equity Securities
Period Total Number
of Shares
Purchased Average Price
Paid per Share Total Number
of Shares
Purchased as Part
of Publicly
Announced
Program Approximate
Dollar Value of
Shares that May
Yet Be Purchased
Under the
Program
July 1 - 31, 2022 — $ — — $ 150,000,002
August 1 - 31, 2022 — $ — — $ 150,000,002
September 1 - 30, 2022 138,528 $ 40.00 138,528 $ 144,459,470
Total 138,528 $ 40.00 138,528


	Issuer Purchases of Equity Securities
Period	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Program	Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program
January 1 - 31, 2023	76,937	$	47.98	76,937	$	110,432,987
February 1 - 28, 2023	2,200	$	48.56	2,200	$	110,326,147
March 1 - 31, 2023	74,400	$	47.98	74,400	$	106,756,068
Total	153,537	$	47.99	153,537

The Company did not sell unregistered equity securities during the period covered by this report.

Item 3. Defaults Upon Senior Securities

Not applicable.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

Not applicable.

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Item 6. Exhibits

~~(a) Exhibits~~


			3.1			Certificate of Incorporation of Gibraltar Industries, Inc., as amended by: (i) Certificate of Amendment of Certificate of Incorporation of Gibraltar Industries, Inc. filed on October 27, 2004, (ii) Certificate of Change of Registered Agent and Registered Office of Gibraltar Industries, Inc. filed on May 11, 2005, (iii) Certificate of Amendment of Certificate of Incorporation of Gibraltar Industries, Inc. filed on May 22, 2012, (iv) Certificate of Amendment of Certificate of Incorporation of Gibraltar Industries, Inc. filed on May 11, 2015, (v) Certificate of Change of Registered Agent and/or Registered Office filed on January 10, 2019, and (vi) Certificate of Amendment of Certificate of Incorporation of Gibraltar Industries, Inc. filed on May 6, 2021 (incorporated by reference to Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q filed on August 3, 2021)
			3.2			Second Amended and Restated ~~By Laws~~By-Laws of Gibraltar Industries, Inc., effective ~~January 1, 2015~~as of December 7, 2022 (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form ~~8-K~~8-K/A filed on ~~January 5, 2015)~~December 9, 2022)
			31.1*			Certification of Chairman of the Board, President and Chief Executive Officer pursuant to Section 302 of the Sarbanes–Oxley Act of 2002.*
			31.2*			Certification of Senior Vice President and Chief Financial Officer pursuant to Section 302 of the Sarbanes–Oxley Act of 2002.*
			32.1**			Certification of the Chairman of the Board, President and Chief Executive Officer pursuant to Title 18, United States Code, Section 1350, as adopted pursuant to Section 906 of the Sarbanes–Oxley Act of 2002.~~* **~~
			32.2**			Certification of the Senior Vice President and Chief Financial Officer pursuant to Title 18, United States Code, Section 1350, as adopted pursuant to Section 906 of the Sarbanes–Oxley Act of 2002.~~* **~~
			~~101.INS~~101.INS*			Inline XBRL Instance Document *
			~~101.SCH~~101.SCH*			Inline XBRL Taxonomy Extension Schema Document *
			~~101.CAL~~101.CAL*			Inline XBRL Taxonomy Extension Calculation Linkbase Document *
			~~101.LAB~~101.LAB*			Inline XBRL Taxonomy Extension Label Linkbase Document *
			~~101.PRA~~101.PRE*			Inline XBRL Taxonomy Extension Presentation Linkbase Document *
			~~101.DEF~~101.DEF*			Inline XBRL Taxonomy Extension Definition Linkbase Document *
			104			Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)


*			Submitted electronically with this Quarterly Report on Form 10-Q.
**			Documents are furnished not ~~filed.~~filed herewith.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


GIBRALTAR INDUSTRIES, ~~INC~~INC.
(Registrant)


/s/ William T. Bosway
William T. Bosway
Chairman of the Board, President and Chief Executive Officer


/s/ Timothy F. Murphy
Timothy F. Murphy
Senior Vice President and Chief Financial Officer

Date: ~~November~~May 3, ~~2022~~2023

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	Three months ended September 30,
	2022						2021
	Exit activity (recoveries) costs, net		Asset impairment charges		Total		Exit activity costs		Asset impairment charges		Total
Renewables	$	(44)	$	—	$	(44)	$	131	$	—	$	131
Residential	—		12		12		83		—		83
Agtech	15		217		232		293		—		293
Infrastructure	—		—		—		—		—		—
Corporate	11		—		11		37		—		37
Total exit activity (recoveries) costs & asset impairments	$	(18)	$	229	$	211	$	544	$	—	$	544


	Nine months ended September 30,
	2022						2021
	Exit activity costs (recoveries), net		Asset impairment charges		Total		Exit activity costs		Asset impairment charges		Total
Renewables	$	1,359	$	1,198	$	2,557	$	4,695	$	1,193	$	5,888
Residential	1,298		12		1,310		177		—		177
Agtech	103		217		320		1,784		—		1,784
Infrastructure	(63)		—		(63)		—		—		—
Corporate	93		—		93		96		—		96
Total exit activity costs & asset impairments	$	2,790	$	1,427	$	4,217	$	6,752	$	1,193	$	7,945


	Three Months Ended September 30, 2021
	Renewables		Residential		Agtech		Infrastructure		Total
Net sales:
Point in Time	$	8,835	$	170,280	$	4,010	$	8,194	$	191,319
Over Time	121,327		1,265		44,965		10,477		178,034
Total net sales	$	130,162	$	171,545	$	48,975	$	18,671	$	369,353


	Nine Months Ended September 30, 2022
	Renewables		Residential		Agtech		Infrastructure		Total
Net sales:
Point in Time	$	18,569	$	591,160	$	9,152	$	25,177	$	644,058
Over Time	272,882		4,162		121,173		33,830		432,047
Total net sales	$	291,451	$	595,322	$	130,325	$	59,007	$	1,076,105


	Nine Months Ended September 30, 2021
	Renewables		Residential		Agtech		Infrastructure		Total
Net sales:
Point in Time	$	21,855	$	472,277	$	16,541	$	25,301	$	535,974
Over Time	301,570		3,694		132,869		31,227		469,360
Total net sales	$	323,425	$	475,971	$	149,410	$	56,528	$	1,005,334