Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Apr. 30, 2018 | May 31, 2018 | Oct. 31, 2017 | |
Document and Entity Information | |||
Entity Registrant Name | GMS Inc. | ||
Entity Central Index Key | 1,600,438 | ||
Document Type | 10-K | ||
Document Period End Date | Apr. 30, 2018 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --04-30 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $ 953.7 | ||
Entity Common Stock, Shares Outstanding | 41,068,954 | ||
Document Fiscal Year Focus | 2,018 | ||
Document Fiscal Period Focus | FY |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Apr. 30, 2018 | Apr. 30, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 36,437 | $ 14,561 |
Trade accounts and notes receivable, net of allowances of $9,633 and $9,851, respectively | 346,450 | 328,988 |
Inventories, net | 239,223 | 200,234 |
Prepaid expenses and other current assets | 11,726 | 11,403 |
Total current assets | 633,836 | 555,186 |
Property and equipment, net of accumulated depreciation of $85,761 and $71,409, respectively | 163,582 | 154,465 |
Goodwill | 427,645 | 423,644 |
Intangible assets, net | 222,682 | 252,293 |
Other assets | 6,766 | 7,677 |
Total assets | 1,454,511 | 1,393,265 |
Current liabilities: | ||
Accounts payable | 116,168 | 102,688 |
Accrued compensation and employee benefits | 56,323 | 58,393 |
Other accrued expenses and current liabilities | 45,146 | 37,891 |
Current portion of long-term debt | 16,284 | 11,530 |
Total current liabilities | 233,921 | 210,502 |
Non-current liabilities: | ||
Long-term debt, less current portion | 579,602 | 583,390 |
Deferred income taxes, net | 10,742 | 26,820 |
Other liabilities | 35,088 | 35,371 |
Liabilities to noncontrolling interest holders, less current portion | 15,707 | 22,576 |
Total liabilities | 875,060 | 878,659 |
Commitments and contingencies (See Note 14) | ||
Stockholders’ equity: | ||
Common stock, par value $0.01 per share, 500,000 shares authorized; 41,069 and 40,971 shares issued and outstanding as of April 30, 2018 and 2017, respectively | 411 | 410 |
Preferred stock, par value $0.01 per share, 50,000 shares authorized; 0 shares issued and outstanding as of April 30, 2018 and 2017 | ||
Additional paid-in capital | 489,007 | 488,459 |
Retained earnings | 89,592 | 26,621 |
Accumulated other comprehensive income (loss) | 441 | (884) |
Total stockholders’ equity | 579,451 | 514,606 |
Total liabilities and stockholders’ equity | $ 1,454,511 | $ 1,393,265 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Apr. 30, 2018 | Apr. 30, 2017 |
Condensed Consolidated Balance Sheets | ||
Trade accounts and notes receivable, allowances (in dollars) | $ 9,633 | $ 9,851 |
Property and equipment, accumulated depreciation (in dollars) | $ 85,761 | $ 71,409 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 41,069,000 | 40,971,000 |
Common stock, shares outstanding | 41,069,000 | 40,971,000 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 50,000,000 | 50,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Apr. 30, 2018 | Apr. 30, 2017 | Apr. 30, 2016 | |
Condensed Consolidated Statements of Operations and Comprehensive Income | |||
Net sales | $ 2,511,469 | $ 2,319,146 | $ 1,858,182 |
Cost of sales (exclusive of depreciation and amortization shown separately below) | 1,692,893 | 1,560,575 | 1,265,018 |
Gross profit | 818,576 | 758,571 | 593,164 |
Operating expenses: | |||
Selling, general and administrative | 633,877 | 585,078 | 470,035 |
Depreciation and amortization | 65,530 | 69,240 | 64,215 |
Total operating expenses | 699,407 | 654,318 | 534,250 |
Operating income | 119,169 | 104,253 | 58,914 |
Other (expense) income: | |||
Interest expense | (31,395) | (29,360) | (37,418) |
Change in fair value of financial instruments | (6,125) | (382) | (19) |
Write-off of debt discount and deferred financing fees | (74) | (7,103) | |
Other income, net | 2,279 | 4,132 | 3,671 |
Total other expense, net | (35,315) | (32,713) | (33,766) |
Income before taxes | 83,854 | 71,540 | 25,148 |
Provision for income taxes | 20,883 | 22,654 | 12,584 |
Net income | $ 62,971 | $ 48,886 | $ 12,564 |
Weighted average common shares outstanding: | |||
Basic (in shares) | 41,015,000 | 40,260,000 | 32,799,000 |
Diluted (in shares) | 42,163,000 | 41,070,000 | 33,125,000 |
Net income per share: | |||
Basic (in dollars per share) | $ 1.54 | $ 1.21 | $ 0.38 |
Diluted (in dollars per share) | $ 1.49 | $ 1.19 | $ 0.38 |
Comprehensive income | |||
Net income | $ 62,971 | $ 48,886 | $ 12,564 |
Changes in other comprehensive income, net of tax | 1,325 | 264 | (1,158) |
Comprehensive income | $ 64,296 | $ 49,150 | $ 11,406 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Common StockInitial public offering | Common Stock | Additional Paid-in CapitalInitial public offering | Additional Paid-in Capital | Retained Earnings (Accumulated Deficit) | Accumulated Other Comprehensive Income (Loss) | Treasury Stock | Initial public offering | Total |
Balance at Apr. 30, 2015 | $ 328 | $ 329,884 | $ (30,650) | $ 10 | $ 299,572 | ||||
Balance (in shares) at Apr. 30, 2015 | 32,758,000 | ||||||||
Increase (Decrease) in Stockholders' Equity | |||||||||
Net income | 12,564 | 12,564 | |||||||
Change in accounting | Change in accounting for liability equity-based awards | (3,208) | (3,208) | |||||||
Change in other comprehensive income, net of tax | (1,158) | (1,158) | |||||||
Equity-based compensation | 2,699 | 2,699 | |||||||
Stock repurchases | $ (5,827) | (5,827) | |||||||
Stock repurchases (in shares) | 395 | ||||||||
Exercise of stock options | $ 1 | 1,661 | (971) | $ 5,827 | 6,518 | ||||
Exercise of stock options (in shares) | 135,000 | (395) | |||||||
Balance at Apr. 30, 2016 | $ 329 | 334,244 | (22,265) | (1,148) | 311,160 | ||||
Balance (in shares) at Apr. 30, 2016 | 32,893,000 | ||||||||
Increase (Decrease) in Stockholders' Equity | |||||||||
Net income | 48,886 | 48,886 | |||||||
Change in other comprehensive income, net of tax | 264 | 264 | |||||||
Equity-based compensation | 2,370 | 2,370 | |||||||
Sales of common stock/Issuance of common stock in initial public offering, net of underwriting discounts and offering costs | $ 80 | $ 151,332 | $ 151,412 | ||||||
Sales of common stock/Issuance of common stock in initial public offering (in shares) | 8,050,000 | ||||||||
Exercise of stock options | $ 1 | 513 | 514 | ||||||
Exercise of stock options (in shares) | 28,000 | ||||||||
Balance at Apr. 30, 2017 | $ 410 | 488,459 | 26,621 | (884) | $ 514,606 | ||||
Balance (in shares) at Apr. 30, 2017 | 40,971,000 | 40,971,000 | |||||||
Increase (Decrease) in Stockholders' Equity | |||||||||
Net income | 62,971 | $ 62,971 | |||||||
Change in other comprehensive income, net of tax | 1,325 | 1,325 | |||||||
Equity-based compensation | 1,513 | 1,513 | |||||||
Tax withholding related to net share settlements of stock options | (1,441) | (1,441) | |||||||
Exercise of stock options | $ 1 | 476 | 477 | ||||||
Exercise of stock options (in shares) | 98,000 | ||||||||
Balance at Apr. 30, 2018 | $ 411 | $ 489,007 | $ 89,592 | $ 441 | $ 579,451 | ||||
Balance (in shares) at Apr. 30, 2018 | 41,069,000 | 41,069,000 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Apr. 30, 2018 | Apr. 30, 2017 | Apr. 30, 2016 | |
Cash flows from operating activities: | |||
Net income | $ 62,971 | $ 48,886 | $ 12,564 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 65,530 | 69,240 | 64,215 |
Write-off and amortization of debt discount and debt issuance costs | 2,851 | 9,793 | 3,438 |
Provision for losses on accounts and notes receivable | (622) | (122) | (1,032) |
Provision for obsolescence of inventory | 106 | 425 | 80 |
Increase (decrease) in fair value of contingent consideration | 195 | (1,484) | |
Equity-based compensation | 5,745 | 3,142 | 4,733 |
Gain on sale and disposal of assets | (509) | (336) | (645) |
Change in fair value of financial instruments | 6,125 | ||
Changes in assets and liabilities net of effects of acquisitions: | |||
Trade accounts and notes receivable | (11,752) | (20,400) | (27,338) |
Inventories | (34,774) | (18,390) | (699) |
Prepaid expenses and other assets | (1,926) | (412) | (4,682) |
Accounts payable | 11,365 | (3,763) | 1,055 |
Accrued compensation and employee benefits | (236) | 4,440 | 3,454 |
Other accrued expenses and current liabilities | 4,874 | 626 | 5,551 |
Deferred income taxes | (16,224) | (20,114) | (20,499) |
Liabilities to noncontrolling interest holders | (3,704) | 1,133 | 446 |
Income tax receivable / payable | (1,399) | (5,956) | 7,106 |
Cash provided by operating activities | 88,616 | 66,708 | 47,747 |
Cash flows from investing activities: | |||
Purchases of property and equipment | (23,741) | (11,083) | (7,692) |
Proceeds from sale of assets | 2,865 | 3,995 | 9,847 |
Acquisition of businesses, net of cash acquired | (28,333) | (150,428) | (120,195) |
Cash used in investing activities | (49,209) | (157,516) | (118,040) |
Cash flows from financing activities: | |||
Repayments on the revolving credit facility | (617,230) | (1,011,925) | (697,144) |
Borrowings from the revolving credit facility | 513,878 | 1,013,365 | 782,104 |
Payments of principal on long-term debt | (5,776) | (4,584) | (3,931) |
Payments of principal on capital lease obligations | (6,132) | (5,208) | (4,249) |
Proceeds from issuance of common stock in initial public offering, net of underwriting discounts | 156,941 | ||
Borrowings from term loan amendments | 577,616 | 481,225 | |
Debt issuance costs | (636) | (2,637) | (391) |
Stock repurchases | (5,827) | ||
Payments for taxes related to net share settlement of equity awards | (1,441) | ||
Proceeds from exercises of stock options | 477 | 345 | 6,519 |
Other financing activities | (671) | ||
Cash (used in) provided by financing activities | (17,531) | 86,297 | 77,081 |
Increase (decrease) in cash and cash equivalents | 21,876 | (4,511) | 6,788 |
Cash and cash equivalents, beginning of year | 14,561 | 19,072 | 12,284 |
Cash and cash equivalents, end of year | 36,437 | 14,561 | 19,072 |
Supplemental cash flow disclosures: | |||
Cash paid for income taxes | 38,954 | 49,163 | 26,067 |
Cash paid for interest | 28,613 | 26,443 | 34,557 |
Supplemental schedule of noncash activities: | |||
Assets acquired under capital lease | 9,086 | 9,410 | 7,542 |
Issuance of installment notes associated with equity-based compensation liability awards | 12,433 | 5,352 | 1,557 |
Increase in other liabilities due to transition guidance | 3,208 | ||
(Decrease) increase in insurance claims payable and insurance recoverable | (2,362) | 1,876 | $ (25,715) |
Second Lien Term Loan | |||
Cash flows from financing activities: | |||
Repayment of term loan / Repayment of term loan amendments | (160,000) | ||
Second amendment to First Lien Credit Agreement | |||
Cash flows from financing activities: | |||
Repayment of term loan / Repayment of term loan amendments | $ (477,616) | $ (381,225) |
Business, Basis of Presentation
Business, Basis of Presentation and Summary of Significant Accounting Policies | 12 Months Ended |
Apr. 30, 2018 | |
Business, Basis of Presentation and Summary of Significant Accounting Policies | |
Business, Basis of Presentation and Summary of Significant Accounting Policies | 1. Business, Basis of Presentation and Summary of Significant Accounting Policies Business Founded in 1971, GMS Inc. (“we,” “our,” “us,” or the “Company”), through its wholly-owned operating subsidiaries, is a distributor of specialty building products including wallboard, suspended ceilings systems, or ceilings, steel framing and other complementary specialty building products. We purchase products from a large number of manufacturers and then distribute these goods to a customer base consisting of wallboard and ceilings contractors and homebuilders and, to a lesser extent, general contractors and individuals. As of April 30, 2018, we had a national footprint with 214 branches across 42 states. Initial and Secondary Public Offerings On June 1, 2016, we completed an initial public offering (“IPO”) of 8.1 million shares of common stock at a price of $21.00 per share, including 1.1 million shares of common stock that were issued as a result of the exercise in full by the underwriters of an option to purchase additional shares to cover over‑allotments. After underwriting discounts and commissions, but before expenses, we received net proceeds from the IPO of approximately $156.9 million. We used these proceeds together with cash on hand to repay $160.0 million principal amount of our term loan debt outstanding under our senior secured second lien term loan facility, which was a payment in full of the entire loan balance due under our senior secured second lien term loan facility. On February 28, 2017, certain of our stockholders completed a secondary public offering of 8.0 million shares of the Company’s common stock at a price to the public of $29.25 per share, including 1.0 million shares of common stock that were sold as a result of the exercise in full by the underwriters of an option to purchase additional shares that was granted by the selling stockholders. We did not receive any proceeds from the sale of our common stock by the selling stockholders. On June 7, 2017, certain of our stockholders completed an additional secondary public offering of 5.8 million shares of the Company’s common stock at a price to the public of $33.00 per share, including 0.8 million shares of common stock that were sold as a result of the exercise in full by the underwriters of an option to purchase additional shares that was granted by the selling stockholders. As a result of such offering, the control group consisting of certain affiliates of AEA Investors LP (“AEA”) and certain other of our stockholders no longer controlled a majority of the voting power of our outstanding common stock. Accordingly, we are no longer a “controlled company” within the meaning of the New York Stock Exchange corporate governance standards. We did not receive any proceeds from the sale of our common stock by the selling stockholders. On December 14, 2017, certain of our stockholders completed an additional secondary public offering of 5.0 million shares of the Company’s common stock at a price to the public of $38.25 per share. We did not receive any proceeds from the sale of our common stock by the selling stockholders. Principles of Consolidation The consolidated financial statements of the Company include the accounts of its wholly-owned subsidiaries. All material intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Reclassifications Certain amounts in the prior year financial statements have been reclassified to conform to the current year presentation. Cash and Cash Equivalents The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. Trade Accounts Receivable Accounts receivables are recorded at their net realizable value. The Company maintains an allowance for doubtful accounts for estimated losses due to the failure of customers to make required payments, as well as allowances for sales returns and cash discounts. The Company’s estimate of the allowance for doubtful accounts is based on an assessment of individual past due accounts, historical write‑off experience, accounts receivable aging and current economic trends. Account balances are written off when the potential for recovery is considered remote. The Company’s estimates of sales returns and cash discounts are based on an analysis of historical information. Inventories Inventories consist of finished goods purchased for resale and include wallboard, ceilings, steel framing and other specialty building products. Inventories are valued at the lower of cost or market (net realizable value). The cost of inventories is determined by the moving average cost method. We monitor our inventory levels and record provisions for excess inventories based on slower moving inventory. In addition, at the end of each year, we evaluate our inventory at each branch and write off and dispose of obsolete products. Our inventories are generally not susceptible to technological obsolescence. Property and Equipment Property and equipment is recorded at cost less accumulated depreciation . Property and equipment obtained through acquisition are stated at estimated fair value as of the acquisition date. Expenditures for improvements and betterments are capitalized, while the costs of maintenance and repairs are charged to operating expense as incurred. Gains and losses related to the sale of property and equipment are recorded in selling, general and administrative expenses in the Consolidated Statements of Operations and Comprehensive Income. Depreciation expense is determined using the straight-line method over the estimated useful lives of the various asset classes. The estimated useful lives of property and equipment are as follows: Buildings 25 - 39 years Furniture, fixtures and automobiles 3 - 5 years Warehouse and delivery equipment 4 - 10 years Leasehold improvements Shorter of estimated useful life or lease term Goodwill Goodwill is the excess of the purchase price over the fair value of identifiable net assets acquired in business combinations accounted for under the acquisition method of accounting. The Company does not amortize goodwill. The Company tests its goodwill annually during the fourth quarter of its fiscal year or when events and circumstances indicate that those assets might not be recoverable. Impairment testing of goodwill is required at the reporting unit level (operating segment or one level below operating segment) and involves a two-step process. Prior to performing the two-step impairment test, the Company may make a qualitative assessment of the likelihood of goodwill impairment in order to determine whether a detailed quantitative analysis is required. The first step of the impairment test involves comparing the estimated fair values of the Company’s reporting units with the reporting units’ carrying amounts, including goodwill. If the carrying amount of the reporting unit exceeds its fair value, a second step is performed to compare the carrying amount of goodwill to the implied fair value of that goodwill. If the carrying amount of goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to the excess. Intangible Assets Intangible assets consist of customer relationships, trade names and other assets acquired in conjunction with the purchases of businesses or purchases of assets from other companies. The Company typically uses an income method to estimate the fair value of intangible assets, which is based on forecasts of the expected future cash flows attributable to the respective assets. When management determines material intangible assets are acquired in conjunction with the purchase of a business, the Company determines the fair values of the identifiable intangible assets by taking into account management’s own analysis and an independent third-party valuation specialist’s appraisal. Intangible assets determined to have definite lives are amortized over their estimated useful lives. Long-Lived Assets The Company evaluates the recoverability of long-lived assets, including property and equipment and intangible assets, for impairment when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Conditions that would necessitate an impairment assessment include a significant decline in the observable market value of an asset, a significant change in the extent or manner in which an asset is used or a significant adverse change that would indicate the carrying amount of an asset or group of assets is not recoverable. For long-lived assets to be held and used, the Company recognizes an impairment loss if its carrying amount is not recoverable through its undiscounted cash flows and measures the impairment loss, if any, based on the difference between the carrying amount and fair value. Long-lived assets held for sale are reported at the lower of cost or fair value less costs to sell and are recorded within prepaid expenses and other current assets in the Consolidated Balance Sheets. The Company classifies assets as held for sale if it commits to a plan to sell the asset within one year and actively markets the asset in its current condition for a price that is reasonable in comparison to its estimated fair value. Insurance Liabilities The Company is self‑insured for certain losses related to medical claims. The Company has stop-loss coverage to limit the exposure arising from medical claims. The Company has deductible‑based insurance policies for certain losses related to general liability, workers’ compensation and automobile. The deductible amount per incident is $0.3 million, $0.5 million and $1.0 million for general liability, workers’ compensation and automobile, respectively. The coverage consists of a primary layer and an excess layer. The primary layer of coverage is from $0.5 million to $2.0 million and the excess layer covers claims from $2.0 million to $100.0 million. The expected ultimate cost for claims incurred as of the balance sheet date is not discounted and is recognized as a liability. Insurance losses for claims filed and claims incurred but not reported are accrued based upon estimates of the aggregate liability for uninsured claims using loss development factors and actuarial assumptions followed in the insurance industry and historical loss development experience. As of April 30, 2018 and 2017, the aggregate liabilities for medical self‑insurance were $4.1 million and $3.4 million, respectively, and are included in other accrued expenses and current liabilities in the Consolidated Balance Sheets. As of April 30, 2018 and 2017, reserves for general liability, workers’ compensation and automobile totaled $14.7 million and $15.9 million, respectively, and are included in other accrued expenses and current liabilities and other liabilities in the Consolidated Balance Sheets. During the year ended April 30, 2016, an insured automobile claim related to prior years, subject to a $0.5 million deductible, was paid by our insurance carrier in the amount of $26.3 million. As of April 30, 2018 and 2017, expected recoveries for medical self‑insurance, general liability, automobile and workers’ compensation totaled $4.8 million and $6.7 million, respectively, and are included in prepaid expenses and other current assets and other assets in the Consolidated Balance Sheets. Debt Issuance Costs The Company capitalizes debt issuance costs and amortizes them over the term of the related debt. The Company uses the straight‑line method to amortize debt issuance costs for its revolving credit facility and uses the effective interest method to amortize debt issuance costs for its term loan facilities. Amortization of debt issuance costs is recorded in interest expense in the Consolidated Statements of Operations and Comprehensive Income. The Company classifies debt issuance costs for its revolving credit facility as an asset in the Consolidated Balance Sheets and classifies debt issuance costs for its term loan facilities as a reduction of the related debt in the Consolidated Balance Sheets. Leases The Company categorizes leases at their inception as either operating or capital leases depending on certain criteria. Leased property and equipment meeting capital lease criteria are capitalized at the lower of the present value of the related lease payments or the fair value of the leased asset at the inception of the lease. Certain of the Company’s operating lease agreements include scheduled rent escalations or rent holidays over the term of the lease. The Company recognizes rent expense on a straight-line basis over the term of the lease. The difference between rent expense and rent paid is recorded as deferred rent in the Consolidated Balance Sheets. Incentives granted under certain leases are treated as a reduction of the Company’s rent expense on a straight-line basis over the term of the related lease agreement. Stock Appreciation Rights, Deferred Compensation and Liabilities to Noncontrolling Interest Holders Certain subsidiaries have equity based compensation agreements with the subsidiary’s employees and minority shareholders. These agreements are stock appreciation rights, deferred compensation agreements and liabilities to noncontrolling interest holders. Since these agreements are typically settled in cash or notes, they are accounted for as liability awards and measured at fair value. See Note 11, “Stock Appreciation Rights, Deferred Compensation and Redeemable Noncontrolling Interests,” for additional information with respect to these agreements. Derivative Instruments The Company has entered into derivative instruments to manage its exposure to certain financial risks. The Company’s derivative financial instruments are recognized as either assets or liabilities in the Consolidated Balance Sheets and measured at fair value. Derivative instruments that do not qualify as a hedge or are not designated as a hedge are adjusted to estimated fair value in earnings. Derivative instruments that meet hedge criteria are formally designated as hedges. For derivative instruments designated as a cash flow hedge, the Company recognizes the change in fair value, net of taxes, on the effective portion of the derivative to accumulated other comprehensive income (loss) in the Consolidated Balance Sheets, and an amount is reclassified out of accumulated other comprehensive income (loss) into earnings to offset the earnings impact that is attributable to the risk being hedged. For derivative instruments designated as a fair value hedge, the Company recognizes the loss or gain attributable to the risk being hedged in earnings in the period of change with a corresponding offset recorded to the item for which the risk is being hedged. The Company performs the effectiveness testing of its designated hedges on a quarterly basis and the changes in ineffective portions of the derivatives, if any, are recognized immediately in earnings. As of April 30, 2018 and 2017, the Company had an interest rate cap agreement with the objective of minimizing the risks and costs associated with its variable rate debt. This agreement is an interest rate cap on quarterly resetting 3‑month LIBOR, based on a strike rate of 2.0% and payable quarterly. This instrument effectively caps the interest rate at 5.75% on an initial notional amount of $275.0 million of the Company’s variable rate debt obligation under the First Lien Facility, or any replacement facility with similar terms. The interest rate cap expires on October 31, 2018. The Company believes there have been no material changes in the creditworthiness of the counterparty to this cap agreement and believes the risk of nonperformance by such party is minimal. The Company has designated the interest rate cap agreement as a cash flow hedge. This derivative instrument is classified in other assets in the Consolidated Balance Sheets. In April 2018, in connection with the acquisition of WSB Titan (see Note 21, “Subsequent Events”), the Company entered into a foreign currency forward contract to mitigate the foreign currency exchange risk associated with the purchase price that was denominated in Canadian dollars. The foreign currency forward contract effectively fixed the amount the Company paid for the purchase price denominated in Canadian dollars by contracting the Company to pay U.S. dollars and receive Canadian dollars on the notional amount. The notional amount of the foreign currency forward contract was $569.2 million as of April 30, 2018. The foreign currency forward contract was not eligible for hedge accounting. This derivative instrument is classified in other accrued expenses and current liabilities in the Consolidated Balance Sheet. See Note 12, “Fair Value Measurements,” and Note 16, “Accumulated Other Comprehensive (Loss) Income,” for additional information with respect to the Company’s derivative instruments. Revenue Recognition The Company recognizes revenue at the point of sale or upon delivery to the customer’s site when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the price to the buyer is fixed or determinable and collectability is reasonably assured. Revenue, net of estimated returns and allowances, is recognized when sales transactions occur and title is passed and the related product is delivered. Revenue includes any applicable shipping and handling costs invoiced to the customer. The expense related to such costs is included in selling, general and administrative expenses in the Consolidated Statements of Operations and Comprehensive Income. Cost of Sales Cost of sales reflects the direct cost of goods purchased from third parties, rebates earned from vendors, adjustments for inventory reserves and the cost of inbound freight. Vendor Rebates Typical arrangements with our vendors provide for us to receive a rebate of a specified amount after we achieve any of a number of measures generally related to the volume of our purchases over a period of time. We record these rebates to effectively reduce our cost of sales in the period in which we sell the product. Throughout the year, we estimate the amount of rebates receivable for the periodic programs based upon the expected level of purchases. We accrue for the receipt of vendor rebates based on purchases and also reduce inventory to reflect the deferral of cost of sales. Selling, General and Administrative Expenses Selling, general and administrative expenses include expenses related to the delivery and warehousing of our products, as well as employee compensation and benefits expenses for employees in our branches and yard support center, as well as other administrative expenses, such as legal, accounting and IT costs. Selling, general and administrative expenses included delivery expenses of $228.0 million, $205.0 million and $159.1 million during the years ended April 30, 2018, 2017 and 2016, respectively. Advertising Expense The cost of advertising is expensed as incurred and included in selling, general and administrative expenses in the Consolidated Statements of Operations and Comprehensive Income. Advertising expense was $1.8 million, $2.3 million and $2.0 million during the years ended April 30, 2018, 2017 and 2016, respectively. Equity‑Based Compensation As of April 30, 2018, the Company had various stock-based compensation plans, which are more fully described in Note 10, “Equity-Based Compensation.” The Company measures compensation cost for all share‑based awards at fair value on the grant date (or measurement date if different) and recognizes compensation expense, net of estimated forfeitures, over the requisite service period for awards expected to vest. The Company estimates the fair value of stock options using the Black-Scholes valuation model and determines the fair value of restricted stock units based on the quoted price of GMS’s common stock on the date of grant . The Company estimates forfeitures based on historical analysis of actual forfeitures and employee turnover. Actual forfeitures are recorded when incurred and estimated forfeitures are reviewed at least annually. Income Taxes Income taxes are accounted for using the asset and liability method. Deferred tax assets and liabilities are recognized based on the difference between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Inherent in the measurement of deferred balances are certain judgments and interpretations of existing tax law and published guidance as applicable to our operations. We evaluate our deferred tax assets to determine if valuation allowances are required. In assessing the realizability of deferred tax assets, we consider both positive and negative evidence in determining whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The primary negative evidence considered includes the cumulative operating losses generated in prior periods. The primary positive evidence considered includes the reversal of deferred tax liabilities related to depreciation and amortization that would occur within the same jurisdiction and during the carry‑forward period necessary to absorb the federal and state net operating losses and other deferred tax assets. The reversal of such liabilities would utilize the federal and state net operating losses and other deferred tax assets. We record amounts for uncertain tax positions that management believes are supportable, but are potentially subject to successful challenge by the applicable taxing authority. Consequently, changes in our assumptions and judgments could materially affect amounts recognized related to income tax uncertainties and may affect our results of operations or financial position. We believe our assumptions for estimates are reasonable, although actual results may have a positive or negative material impact on the balances of such tax positions. Historically, the variation of estimates to actual results is not significant and material variation is not expected in the future. Credit and Economic Risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash and cash equivalents and trade accounts and notes receivable. The Company assesses the credit standing of counterparties as considered necessary. The Company routinely assesses the financial strength of its customers and generally does not require collateral. Concentrations of credit risk with respect to trade accounts receivable are limited due to the large number of geographically diverse customers comprising the Company’s customer base. Additionally, the Company maintains allowances for potential credit losses. The Company does not enter into financial instruments for trading or speculative purposes. As of April 30, 2018 and 2017, no customer accounted for more than 10% of gross accounts receivable. The Company purchases a majority of its inventories from a select group of vendors. Without these vendors, the Company’s ability to acquire inventory would be significantly impaired. Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Authoritative guidance for fair value measurements establishes a three‑level hierarchy that prioritizes the inputs to valuation models based upon the degree to which they are observable. The three levels of the fair value measurement hierarchy are as follows: Level 1 Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity can access at the measurement date. Level 2 Inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3 Inputs are unobservable inputs for which little or no market data exists, therefore requiring an entity to develop its own assumptions. The carrying values of the Company’s cash, cash equivalents, trade receivables and trade payables approximate their fair values because of their nature and short‑term nature . Based on borrowing rates available to the Company for loans with similar terms, the carrying values of the Company’s debt instruments approximate fair value. See Note 12, “Fair Value Measurements,” for additional information with respect to the Company’s fair value measurements. Earnings Per Share Basic earnings per share is computed by dividing net income by the weighted average number of outstanding shares of common stock for the period. Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common stock, including stock options and restricted stock units (collectively “Common Stock Equivalents”), were exercised or converted into common stock . The dilutive effect of outstanding stock options and restricted stock units is reflected in diluted earnings per share by application of the treasury stock method. In applying the treasury stock method for stock-based compensation arrangements, the assumed proceeds are computed as the sum of the amount the employee must pay upon exercise and the amount of compensation cost attributed to future services and not yet recognized. Diluted earnings per share is computed by increasing the weighted‑average number of outstanding shares of common stock computed in basic earnings per share to include the dilutive effect of Common Stock Equivalents for the period. In periods of net loss, the number of shares used to calculate diluted loss per share is the same as basic net loss per share. Recently Adopted Accounting Pronouncements Inventory —In July 2015, the Financial Accounting Standards Board (the “FASB”) issued authoritative guidance on accounting for inventory. The new guidance requires that inventory be measured at the lower of cost and net realizable value. The new guidance is limited to inventory measured using the first-in, first-out (“FIFO”) or average cost methods and excludes inventory measured using last-in, first-out (“LIFO”) or retail inventory methods. The new standard is effective for fiscal years, and interim periods, beginning after December 15, 2016. The Company adopted this guidance on May 1, 2017 (the first day of fiscal 2018) with no Stock Compensation —In March 2016, the FASB issued authoritative guidance that simplifies many key aspects of the accounting for and cash flow presentation of employee share-based compensation transactions, including accounting for income taxes, forfeitures and statutory withholding requirements. The Company adopted this guidance on May 1, 2017 (the first day of fiscal 2018) on a prospective basis. Effective May 1, 2017, the Company now records all excess tax benefits or tax deficiencies as a component of its provision for income taxes in the statement of operations. The Company recorded excess tax benefits of $1.3 million during the year ended April 30, 2018. Additionally, the Company now presents excess tax benefits or deficiencies as operating cash flows versus reclassifying the amount out of operating cash flows and presenting it in financing activities in the Consolidated Statement of Cash Flows. Additional amendments from this guidance related to forfeitures and minimum statutory withholding tax requirements had no impact to our financial position, results of operations or cash flows. As permitted, we continue to estimate forfeitures to determine the amount of compensation cost to be recognized each period rather than electing to account for forfeitures as they occur, and we continue to present the value of shares withheld for minimum statutory tax withholding requirements on the statements of cash flows as a financing activity. Another impact of the adoption is that the calculation of the effect of dilutive securities now excludes any derived excess tax benefits or deficiencies from assumed future proceeds. Definition of a Business —In January 2017, the FASB authoritative guidance on the definition of a business. The new guidance clarifies the definition of a business to help companies evaluate whether acquisition or disposal transactions should be accounted for as assets groups or as businesses. The Company adopted this guidance on May 1, 2017 (the first day of fiscal 2018) on a prospective basis with no material impact to the Company’s financial position, results of operations or cash flows. Recently Issued Accounting Pronouncements Revenue recognition — In May 2014, the FASB issued authoritative guidance on revenue from contracts with customers. The new guidance supersedes most existing revenue recognition guidance and outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. The core principle of the revenue model is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new standard also requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers . In August 2015, the FASB issued guidance that deferred the effective date by one year. The standard is now required to be adopted by public business entities in annual periods beginning on or after December 15, 2017, and interim periods within those annual periods, and may be applied on a full retrospective or modified retrospective approach. Early adoption at the original effective date is permitted. The Company adopted this guidance on May 1, 2018 (the first day of fiscal 2019) using the modified retrospective approach. The Company completed its assessment of the new revenue recognition guidance and concluded that the adoption of this standard did not have a material impact on its financial statements. The adoption of the new guidance will result in additional disclosures regarding the Company’s revenue recognition beginning with the Company’s Quarterly Report on Form 10-Q for the quarterly period ended July 31, 2018. The adoption of the new guidance will also result in a balance sheet reclassification for recording our estimate for customer returns. Leases —In February 2016, the FASB issued authoritative guidance on accounting for leases. The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with such classification affecting the pattern of expense recognition in the statement of operations. The new standard is effective for the Company’s fiscal year beginning May 1, 2019 (the first day of fiscal 2020), including interim reporting periods within that fiscal year. A modified transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. While the Company is still evaluating the impact of its pending adoption of the new standard on its financial statements, the Company expects that upon adoption it will recognize material ROU assets and liabilities. Statement of Cash Flows – In August 2016, the FASB issued new guidance to reduce diversity in practice related to certain cash receipts and payment in the statement of cash flows by adding or clarifying guidance on eight specific cash flow issues. The new guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017 . Early adoption is permitted. The Company adopted this guidance on May 1, 2018 (the first day of fiscal 2019) with no material impact on its financial statements. Income Taxes – In October 2016, the FASB issued new guidance intended to improve the accounting |
Business Acquisitions
Business Acquisitions | 12 Months Ended |
Apr. 30, 2018 | |
Business Acquisitions | |
Business Acquisitions | 2. Business Acquisitions The Company accounts for business combinations by recognizing the assets acquired and liabilities assumed at the acquisition date fair value. In valuing acquired assets and liabilities, fair value estimates use Level 3 inputs, including future expected cash flows and discount rates. Goodwill is measured as the excess of consideration transferred over the fair values of the assets acquired and the liabilities assumed. While the Company uses its best estimates and assumptions as a part of the purchase price allocation process to accurately value assets acquired and liabilities assumed at the acquisition date, the Company’s estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the acquisition date, the Company records adjustments to the assets acquired and liabilities assumed, with the corresponding offset to goodwill. Upon the conclusion of the measurement period, any subsequent adjustments arising from new facts and circumstances are recorded to the Consolidated Statements of Comprehensive Income. The results of operations of acquisitions are reflected in the Company’s Consolidated Financial Statements from the date of acquisition. Fiscal 2018 Acquisitions In fiscal 2018, the Company completed the following acquisitions, with an aggregate purchase price of $24.4 million of cash consideration, subject to finalization of certain working capital settlement amounts. The purpose of these acquisitions was to expand the geographical coverage of the Company and grow the business. Company Name Form of Acquisition Date of Acquisition ASI Building Products, LLC Purchase of net assets August 1, 2017 Washington Builders Supply, Inc. Purchase of net assets October 2, 2017 Southwest Building Materials, Ltd. Purchase of net assets December 4, 2017 California-based distribution business of Grabber Construction Products, Inc. Purchase of net assets April 2, 2018 CMH Distributing, Inc. Purchase of net assets April 2, 2018 The preliminary allocation of consideration for these acquisitions is summarized as follows: Preliminary Purchase Price Allocation (in thousands) Trade accounts and notes receivable $ 4,872 Inventories 4,321 Property and equipment 1,081 Tradenames 1,000 Vendor agreement 1,000 Other intangible assets 620 Customer relationships 9,358 Goodwill 4,145 Liabilities assumed (1,951) Purchase price $ 24,446 Goodwill recognized is attributable to synergies achieved through the streamlining of operations combined with improved margins attainable through increased market presence and is all attributable to our one operating reportable segment. The goodwill and other intangible assets related to these acquisitions are expected to be deductible for U.S. federal income tax purposes. The Company believes that information gathered to date provides a reasonable basis for estimating the fair values of assets acquired and liabilities assumed, but the Company is waiting for additional information necessary to finalize certain of those fair values, specifically, the finalization of working capital settlements. Thus, the provisional measurements of certain fair values set forth above are preliminary. Such changes are not expected to be significant. The Company expects to complete the purchase price allocation as soon as practicable, but no later than one year from the applicable acquisition date. The pro forma impact of these acquisitions is not presented as it is not considered material to the Company’s Consolidated Financial Statements. Fiscal 2017 Acquisitions In fiscal 2017, the Company completed the following acquisitions, with an aggregate purchase price of $154.0 million, comprised of $148.7 million of cash consideration and $5.3 million of consideration related to working capital settlements and contingent consideration. The purpose of these acquisitions was to expand the geographical coverage of the Company and grow the business. Company Name Form of Acquisition Date of Acquisition Wall & Ceiling Supply Co., Inc. Purchase of net assets May 2, 2016 Rockwise, LLC Purchase of net assets July 5, 2016 Steven F. Kempf Building Materials, Inc. Purchase of net assets August 29, 2016 Olympia Building Supplies, LLC/Redmill, Inc. Purchase of 100% of outstanding common stock September 1, 2016 United Building Materials, Inc. Purchase of net assets October 3, 2016 Ryan Building Materials, Inc. Purchase of net assets October 31, 2016 Interior Products Supply Purchase of net assets December 5, 2016 Hawaii-based distribution business of Grabber Construction Products, Inc. Purchase of net assets February 1, 2017 The allocation of consideration for these acquisitions is summarized as follows: Preliminary Final Purchase Price Adjustments/ Purchase Price Allocation Reclassifications Allocation (in thousands) Cash and cash equivalents $ 1,558 $ — $ 1,558 Trade accounts and notes receivable 37,691 (63) 37,628 Inventories 16,504 — 16,504 Other current assets 657 14 671 Property and equipment 8,357 — 8,357 Tradenames 9,490 — 9,490 Customer relationships 64,660 — 64,660 Goodwill 37,728 (144) 37,584 Deferred tax liability (6,011) — (6,011) Liabilities assumed (16,958) 560 (16,398) Purchase price $ 153,676 $ 367 $ 154,043 During the year ended April 30, 2018, the Company recorded adjustments to working capital for fiscal 2017 acquisitions resulting in an increase in total consideration paid of $0.4 million. Goodwill recognized is attributable to synergies achieved through the streamlining of operations combined with improved margins attainable through increased market presence and is all attributable to our one operating reportable segment. Goodwill of $25.4 million and other intangible assets of $53.6 million related to these acquisitions are expected to be deductible for U.S. federal income tax purposes. Goodwill of $12.2 million and other intangibles of $20.6 million are nondeductible for U.S. federal income tax purposes. Fiscal 2016 Acquisitions In fiscal 2016, the Company completed the following acquisitions, with an aggregate purchase price of $117.2 million, comprised of $114.8 million of cash consideration and $2.4 million of contingent consideration. The purpose of these acquisitions was to expand the geographical coverage of the Company and grow the business. Company Name Form of Acquisition Date of Acquisition Tri-Cities Drywall & Supply Co. Purchase of net assets September 29, 2015 Badgerland Supply, Inc. Purchase of net assets November 2, 2015 Hathaway & Sons, Inc. Purchase of net assets November 9, 2015 Gypsum Supply Company Purchase of 100% of outstanding common stock January 1, 2016 Robert N. Karpp Co., Inc. Purchase of net assets February 1, 2016 Professional Handling & Distribution, Inc. Purchase of net assets February 1, 2016 M.R. Lee Building Materials, Inc. Purchase of net assets April 4, 2016 The allocation of consideration for these acquisitions is summarized as follows: Final Purchase Price Allocation (in thousands) Cash and cash equivalents $ 953 Trade accounts and notes receivable 26,988 Inventories 17,703 Property and equipment 9,236 Other assets 808 Tradenames 12,500 Below market leases 2,020 Customer relationships 29,055 Goodwill 38,399 Deferred tax liability (6,676) Liabilities assumed (13,805) Purchase price $ 117,181 Goodwill recognized is attributable to synergies achieved through the streamlining of operations combined with improved margins attainable through increased market presence and is all attributable to our one operating reportable segment. Goodwill of $13.4 million and other intangible assets of $26.3 million are expected to be deductible for U.S. federal income tax purposes. Goodwill of $25.0 million and other intangibles of $17.2 million are nondeductible for U.S. federal income tax purposes. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Apr. 30, 2018 | |
Property and Equipment | |
Property and Equipment | 3. Property and Equipment The Company’s property and equipment consisted of the following as of April 30, 2018 and 2017: April 30, 2018 2017 (in thousands) Land $ 50,795 $ 50,009 Buildings and leasehold improvements 87,837 81,872 Machinery and equipment 108,444 90,303 Construction in progress 2,267 3,690 Total property and equipment 249,343 225,874 Less: accumulated depreciation and amortization 85,761 71,409 Total property and equipment, net of accumulated depreciation $ 163,582 $ 154,465 Depreciation expense for property and equipment, which includes amortization of property under capital leases, was $24.1 million, $25.6 million and $26.7 million during the years ended April 30, 2018, 2017 and 2016 respectively. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Apr. 30, 2018 | |
Goodwill and Intangible Assets | |
Goodwill and Intangible Assets | 4. Goodwill and Intangible Assets Goodwill The following table presents changes in the carrying amount of goodwill during the years ended April 30, 2018 and 2017: Carrying Amount (in thousands) Balance as of April 30, 2016 $ 386,306 Goodwill acquired 37,728 Purchase price adjustments (390) Balance as of April 30, 2017 423,644 Goodwill acquired 4,145 Purchase price adjustments (144) Balance as of April 30, 2018 $ 427,645 All goodwill relates to our geographic divisions reportable segment. The annual impairment tests during the fourth quarters of fiscal 2018, 2017 and 2016 indicated that the fair value of the Company’s reporting units exceeded their carrying values. The Company identified six reporting units for evaluating goodwill for the fiscal 2018 annual impairment test, which were Central, Midwest, Northeast, Southern, Southeast and Western. Each of these reporting units constitutes a business for which discrete financial information is available and segment management regularly reviews the operating results. The Company evaluates its reporting units on an annual basis. The Company estimated the fair values of its reporting units based on weighting of a discounted cash flow analysis, a market comparable method and a market transaction approach. These models use significant unobservable inputs, or Level 3 inputs, as defined by the fair value hierarchy. The significant assumptions used in the discounted cash flow method included internal forecasts and projections developed by management for planning purposes, available industry/market data, discount rates and the growth rate to calculate the terminal value. Under the market approach and market transaction approach, the fair value was estimated using the guideline company method. The Company selected guideline companies in the industry in which each reporting unit operates. Intangible Assets The following tables present the components of the Company’s definite-lived intangible assets as of April 30, 2018 and 2017: Estimated Weighted April 30, 2018 Useful Average Gross Net Lives Amortization Carrying Accumulated Carrying (years) Period Amount Amortization Value (dollars in thousands) Customer relationships 5 - 13 10.9 $ 282,547 $ 150,081 $ 132,466 Definite-lived tradenames 5 - 20 18.0 26,250 3,578 22,672 Vendor agreements 8 - 10 8.3 6,644 2,956 3,688 Leasehold interests 7 - 15 9.0 2,866 832 2,034 Other 5 5.0 521 66 455 Totals $ 318,828 $ 157,513 $ 161,315 Estimated Weighted April 30, 2017 Useful Average Gross Net Lives Amortization Carrying Accumulated Carrying (years) Period Amount Amortization Value (dollars in thousands) Customer relationships 5 - 13 10.9 $ 273,196 $ 111,291 $ 161,905 Definite-lived tradenames 5 - 20 18.3 25,250 1,718 23,532 Vendor agreement 8 8.0 5,644 2,176 3,468 Leasehold interests 7 - 13 8.2 2,516 496 2,020 Totals $ 306,606 $ 115,681 $ 190,925 Definite-lived intangible assets are amortized over their estimated useful lives. The Company amortizes its customer relationships using an accelerated method to match the estimated cash flow generated by such assets, and amortizes its other definite-lived intangibles using the straight-line method because a pattern to which the expected benefits will be consumed or otherwise used up could not be reliably determined. Amortization expense related to definite-lived intangible assets was $41.5 million, $43.7 million and $37.5 million during the years ended April 30, 2018, 2017 and 2016, respectively, and is recorded in depreciation and amortization expense in the Consolidated Statements of Operations and Comprehensive Income. Based on the current amount of definite-lived intangible assets, the Company expects to record amortization expense of $34.8 million, $28.0 million, $22.6 million, $18.4 million, $14.2 million and $43.3 million during the years ending April 30, 2019, 2020, 2021, 2022, 2023 and thereafter, respectively. Actual amortization expense to be reported in future periods could differ materially from these estimates as a result of acquisitions, changes in useful lives and other relevant factors. The Company’s indefinite-lived intangible assets, other than goodwill, consist of tradenames that had a carrying amount of $61.4 million as of April 30, 2018 and 2017. |
Other Accrued Expenses and Curr
Other Accrued Expenses and Current Liabilities | 12 Months Ended |
Apr. 30, 2018 | |
Other Accrued Expenses and Current Liabilities | |
Other Accrued Expenses and Current Liabilities | 5. Other Accrued Expenses and Current Liabilities The Company’s other accrued expenses and current liabilities consisted of the following as of April 30, 2018 and 2017: April 30, 2018 2017 (in thousands) Insurance related liabilities $ 11,432 $ 11,027 Sales taxes payable 9,864 8,920 Derivative liability 5,108 — Accrued rebates 3,640 3,041 Contingent consideration 1,917 5,708 Real estate and personal property taxes 1,823 1,686 Deferred revenue 1,402 573 Other 9,960 6,936 Total other accrued expenses and current liabilities $ 45,146 $ 37,891 |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Apr. 30, 2018 | |
Long-Term Debt | |
Long-Term Debt | 6. Long‑Term Debt The Company’s long‑term debt consisted of the following as of April 30, 2018 and 2017: April 30, April 30, 2018 2017 (in thousands) First Lien Term Loan due 2023 (1) (2) $ 563,179 $ 470,245 ABL Facility — 103,353 Capital lease obligations, at an annual rate of 5.50%, due in monthly installments through 2023 18,564 15,611 Installment notes at fixed rates up to 5.0%, due in monthly and annual installments through 2023 (3) 14,143 5,711 Carrying value of debt 595,886 594,920 Less current portion 16,284 11,530 Long-term debt $ 579,602 $ 583,390 (1) Net of unamortized discount of $2,536 and $1,658 as of April 30, 2018 and 2017, respectively. (2) Net of deferred financing costs of $6,125 and $5,712 as of April 30, 2018 and 2017, respectively. (3) Net of unamortized discount of $1,534 and $751 as of April 30, 2018 and 2017, respectively. Term Loan Facilities On April 1, 2014, the Company’s wholly‑owned subsidiaries, GYP Holdings II Corp., as parent guarantor (in such capacity, “Holdings”), and GYP Holdings III Corp., as borrower (in such capacity, the “Borrower” and, together with Holdings and the Subsidiary Guarantors (as defined below), the “Loan Parties”), entered into a senior secured first lien term loan facility (the “First Lien Facility”) and a senior secured second lien term loan facility (the “Second Lien Facility” and, together with the First Lien Facility, the “Term Loan Facilities”) in the aggregate amount of $550.0 million to acquire Gypsum Management and Supply, Inc. The Term Loan Facility originally consisted of a First Lien Term Loan and a Second Lien Term Loan (respectively, the “First Term Loan” and “Second Term Loan”). The First Term Loan was issued in an original aggregate principal amount of $388.1 million (net of $2.0 million of original issue discount). The Second Term Loan was issued in an original aggregate principal amount of $158.4 million (net of $1.6 million of original issue discount) and is no longer outstanding. The First Lien Facility permits the Borrower to add one or more incremental term loans up to a fixed amount of $100.0 million plus a certain amount depending on a secured first lien leverage ratio test included in the First Lien Facility. As of April 30, 2018, the First Term Loan amortized in nominal quarterly installments of $1.4 million, or 0.25% of the aggregate principal amount of the First Term Loan and had a maturity date of April 1, 2023. Provided that the individual affected lenders agree accordingly, the maturities of the First Lien Term Loan may, upon the Borrower’s request and without the consent of any other lender, be extended. On June 1, 2016, the Company used the IPO proceeds together with cash on hand to repay the $160.0 million principal amount of its term loan debt outstanding under our Second Lien Facility, which was a payment in full of the entire loan balance due under the Second Lien Facility. The Company recorded a write-off of debt discount and deferred financing fees of $5.4 million, which is included in write-off of discount and deferred financing fees in the Consolidated Statements of Operations and Comprehensive Income for the year ended April 30, 2017. On September 27, 2016, the Company entered into an Incremental First Lien Term Commitments Amendment (the “First Amendment”) to the First Lien Credit Agreement, dated April 1, 2014, among GYP Holdings III Corp., as borrower, GYP Holdings II Corp., the financial institutions from time to time party thereto, as lenders, and Credit Suisse AG, as administrative agent and collateral agent. The First Amendment amended the First Lien Credit Agreement to, among other things, provide for a new first lien term loan facility under the First Lien Credit Agreement in the aggregate principal amount of $481.2 million with an interest at a floating rate based on LIBOR, with a 1.00% floor, plus 3.50%, representing a twenty five basis point improvement compared to the interest rate of the existing First Lien Term Loan immediately prior to giving effect to the First Amendment. Net proceeds from the new First Lien Term Loan were used to repay the Company’s existing First Lien Term Loan of $381.2 million and a portion of the loans under the ABL Facility as well as to pay related expenses. The Company recorded a write-off of debt discount and deferred financing fees of $1.5 million, which is included in write-off of discount and deferred financing fees in the Consolidated Statements of Operations and Comprehensive Income for the year ended April 30, 2017. On June 7, 2017, the Company entered into the Second Amendment to First Lien Credit Agreement (the “Second Amendment”), among the Borrower, Holdings, the other Loan Parties party thereto, Credit Suisse AG, as administrative agent and as 2017 incremental first lien lender, which amended the First Lien Credit Agreement (as amended by the First Amendment and as supplemented from time to time). The Second Amendment provided for a new first lien term loan facility under the First Lien Credit Agreement in the aggregate principal amount of $577.6 million due on April 1, 2023 with interest at a floating rate based on LIBOR, with a 1.00% floor, plus 3.00%, representing a fifty basis point improvement compared to the interest rate of the existing First Lien Facility immediately prior to giving effect to the Second Amendment. As of April 30, 2018, the applicable rate of interest was 5.36 %. Net proceeds were used to repay the existing First Lien Loan outstanding balance of $477.6 million and approximately $94.0 million of loans under its asset based revolving credit facility as well as to pay related expenses. The Company recorded a write off of debt discount and deferred financing fees of $0.1 million, which is included in write-off of discount and deferred financing fees in the Consolidated Statements of Operations and Comprehensive Income for the year ended April 30, 2018. Asset Based Lending Facility The Company has an Asset Based Lending Credit Facility (the “ABL Facility”) that provides for aggregate revolving commitments of $345.0 million (including same day swing line borrowings of $34.5 million). GYP Holdings III Corp. is the lead borrower (in such capacity, the “Lead Borrower”). Extensions of credit under the ABL Facility are limited by a borrowing base calculated periodically based on specified percentages of the value of eligible inventory and eligible accounts receivable, subject to certain reserves and other adjustments. At the Company’s option, the interest rates applicable to the loans under the ABL Facility are based at LIBOR or base rate plus, in each case, an applicable margin. The margins applicable for each elected interest rate are subject to a pricing grid, as defined in the ABL Facility agreement, based on average daily availability for the most recent fiscal quarter. The ABL Facility also contains an unused commitment fee subject to utilization, as included in the ABL Facility agreement. As of April 30, 2018, the Company had available borrowing capacity of $333.7 million under the ABL Facility. The ABL Facility will mature on November 18, 2021 unless the individual affected lenders agree to extend the maturity of their respective loans under the ABL Facility upon the Company's request and without the consent of any other lender. The ABL Facility contains a cross default provision with the First Lien Facility. Terms of the ABL Facility and Term Loan Facilities Collateral The ABL Facility is collateralized by (a) first priority perfected liens on the following assets of the Loan Parties: (i) accounts receivable; (ii) inventory; (iii) deposit accounts; (iv) cash and cash equivalents; (v) tax refunds and tax payments; (vi) chattel paper; and (vii) documents, instruments, general intangibles, securities accounts, books and records, proceeds and supporting obligations related to each of the foregoing, subject to certain exceptions (collectively, “ABL Priority Collateral”) and (b) second priority perfected liens on the remaining assets of the Loan Parties not constituting ABL Priority Collateral, subject to customary exceptions (collectively, “Term Priority Collateral”). The First Lien Facility is collateralized by (a) first priority liens on the Term Priority Collateral and (b) second priority liens on the ABL Priority Collateral, subject to customary exceptions. Prepayments The Term Loans may be prepaid at any time. Under certain circumstances and subject to certain exceptions, the Term Loan Facilities will be subject to mandatory prepayments in the amount equal to: · 100% of the net proceeds of certain asset sales and issuances or incurrences of nonpermitted indebtedness; and · 50% of annual excess cash flow for any fiscal year, such percentage to decrease to 25% or 0% depending on the attainment of certain total leverage ratio targets. As of April 30, 2018, there was no prepayment required related to excess cash flow. The ABL Facility may be prepaid at the Company’s option at any time without premium or penalty and will be subject to mandatory prepayment if the outstanding ABL Facility exceeds the lesser of the (i) borrowing base and (ii) the aggregate amount of commitments. Mandatory prepayments do not result in a permanent reduction of the lenders’ commitments under the ABL Facility. Guarantees Holdings guarantees the payment obligations under the ABL Facility and the Term Loan Facilities. Certain of Holdings’ subsidiaries (i) guarantee the payment obligations under the Term Loan Facilities (in such capacity, the “Subsidiary Guarantors”) and (ii) are co‑borrowers under the ABL Facility. Covenants The ABL Facility contains certain affirmative covenants, including financial and other reporting requirements. The Company was in compliance with all such covenants as of April 30, 2018. The First Lien Facility contains a number of covenants that limit the Company’s ability and the ability of the Company’s restricted subsidiaries, as described in the First Lien Credit Agreement, to: incur more indebtedness; pay dividends, redeem stock or make other distributions; make investments; create restrictions on the ability of our restricted subsidiaries to pay dividends to us or make other intercompany transfers; create liens securing indebtedness; transfer or sell assets; merge or consolidate; enter into certain transactions with our affiliates; and prepay or amend the terms of certain indebtedness. The Company was in compliance with all covenants as of April 30, 2018. Events of Default The ABL Facility and Term Loan Facilities also provide for customary events of default, including non‑payment of principal, interest or fees, violation of covenants, material inaccuracy of representations or warranties, specified cross default to other material indebtedness, certain bankruptcy events, certain ERISA events, material invalidity of guarantees or security interest, material judgments and changes of control. Installment Notes The Company’s installment notes of $14.1 million and $5.7 million as of April 30, 2018 and 2017, respectively, include notes for subsidiary stock repurchases from stockholders, notes for the payout of stock appreciation rights and a note to the seller of an acquired company. See Note 11, “Stock Appreciation Rights, Deferred Compensation and Redeemable Noncontrolling Interests.” Debt Maturities As of April 30, 2018, the maturities of long‑term debt were as follows: First Lien Installment Capital Term Loan(1) Notes(2) Leases Total Years ending April 30, (in thousands) 2019 $ 5,776 $ 4,048 $ 6,460 $ 16,284 2020 5,776 3,292 5,157 14,225 2021 5,776 2,989 3,574 12,339 2022 5,776 2,553 1,747 10,076 2023 548,736 2,521 1,070 552,327 Thereafter — 274 556 830 $ 571,840 $ 15,677 $ 18,564 $ 606,081 (1) (2) |
Retirement Plan
Retirement Plan | 12 Months Ended |
Apr. 30, 2018 | |
Retirement Plan | |
Retirement Plan | 7. Retirement Plan The Company maintains a 401(k) defined contribution retirement plan for its employees. Participants are allowed to choose from a selection of mutual funds in order to designate how both employer and employee contributions are invested. Under the plan, the Company matches 50% of each employee’s contributions on the first 4% of the employee’s compensation contributed. The Company contributed $4.3 million, $3.7 million and $1.7 million, during the years ended April 30, 2018, 2017 and 2016, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Apr. 30, 2018 | |
Income Taxes | |
Income Taxes | 8. Income Taxes The following table presents the components of i ncome tax expense for the years ended April 30, 2018, 2017 and 2016: Year Ended April 30, 2018 2017 2016 (in thousands) Current federal $ 30,827 $ 37,164 $ 28,043 Current state 6,409 5,875 5,162 Total current 37,236 43,039 33,205 Deferred federal (14,796) (19,011) (19,993) Deferred state (1,557) (1,374) (628) Total deferred (16,353) (20,385) (20,621) Total provision for income taxes $ 20,883 $ 22,654 $ 12,584 The following table summarizes the significant differences between the U.S. federal statutory tax rate and the Company’s effective tax rate for financial statement for the years ended April 30, 2018, 2017 and 2016: Year Ended April 30, 2018 2017 2016 (in thousands) Federal income taxes at statutory rate $ 25,492 $ 25,039 $ 8,802 State income taxes, net of federal income tax benefit 1,900 2,236 2,336 Net change in valuation allowance 151 214 (60) Nondeductible meals & entertainment 822 761 627 338(h)(10) election — (6,936) — Redeemable noncontrolling interests — 1,053 291 Nondeductible transaction costs 2 109 253 Net Deferred Benefit due to Tax Cuts and Jobs Act (6,763) — — Other (721) 178 335 Total provision for income taxes $ 20,883 $ 22,654 $ 12,584 The tax effects of temporary differences, which give rise to deferred income taxes as of April 30, 2018 and 2017 are as follows: April 30, 2018 2017 Deferred income tax assets: (in thousands) Allowances on accounts and notes receivable $ 3,540 $ 5,792 Accrued payroll and related costs 1,138 1,651 Insurance reserves 1,734 1,139 Inventory costs 2,013 2,430 Deferred compensation 6,662 9,293 Equity compensation 2,361 3,424 Derivative instrument 561 1,488 Acquisition related costs 1,955 1,732 Net operating loss carry-forwards 1,965 2,949 Deferred rent 488 996 Noncompete agreements 681 819 Other deferred tax assets, net 946 2,576 Total deferred income tax assets 24,044 34,289 Less: Valuation allowance (448) (297) Total deferred income tax assets, net of valuation allowance 23,596 33,992 Deferred income tax liabilities: Amortization of intangible assets (28,641) (53,345) Rebates (253) (1,007) Depreciation (3,596) (3,808) Deferred financing costs (1,848) (2,652) Total deferred income tax liabilities (34,338) (60,812) Deferred income tax liabilities, net $ (10,742) $ (26,820) Tax Cuts and Job Act. On December 22, 2017, the Tax Cuts and Jobs Act of 2017 (the “Tax Act”) was signed into law. The Tax Act includes a number of provisions, including the lowering of the U.S. corporate income tax rate from 35% to 21% effective January 1, 2018. Because the Company’s fiscal 2018 ends April 30, 2018, the Company’s tax provision for the current fiscal year utilized a blended statutory federal rate of 30.4%, calculated by applying a prorated percentage of the number of days prior to and subsequent to the January 1, 2018 effective date of the Tax Act. In future fiscal years, the Company expects its statutory federal rate to be 21%. During the year ended April 30, 2018, the Company revised its estimated annual effective tax rate to reflect the change in the federal statutory rate. In connection with the Tax Act, the SEC issued Staff Accounting Bulletin No. 118 (“SAB 118”) to provide guidance to companies that have not completed their accounting for the income tax effects of the Tax Act. Under SAB 118, provisional amounts can be recorded to the extent a reasonable estimate can be made. Additional tax effects and adjustments to previously recorded provisional amounts can be recorded upon obtaining, preparing, or analyzing additional information (including computations) within one year from the enactment date of the Tax Act. As of April 30, 2018, the Company was still assessing the overall impact of the Tax Act on its financial statements and had not completed its accounting for the tax effects of the Tax Act. The Company has reported provisional amounts reflecting reasonable estimates for the re-measurement of net deferred tax liabilities as of April 30, 2018 due to the reduction in the corporate rate. The Company recorded a provisional income tax benefit of $6.7 million for this re-measurement for the year ended April 30, 2018, which is included in provision for income taxes in the Consolidated Statements of Operations and Comprehensive Income. This represents a $1.1 million decrease from the provisional amount recorded during the nine months ended January 31, 2018. The estimated impact of the Tax Act was based on a preliminary review of the new law and is subject to revision due to, among other things, changes in interpretations of the Tax Act, any legislative action to address questions that arise because of the Tax Act or any updates or changes to estimates the Company has utilized to calculate the impacts . Additionally, the Company continues to analyze additional information and guidance related to certain aspects of the Tax Act, such as limitations on the deductibility of executive compensation, conformity or changes by state taxing authorities in response to The Act, and the deductibility of other expenses impacted by the Tax Act. The Company will complete its accounting for the Tax Act in the period in which the Company has obtained, prepared and analyzed all information needed (including computations) for its analysis, but no later than one year from the enactment date of the Tax Act. All items related to the Tax Act remain provisional as of April 30, 2018. Effective tax rate. Income taxes for financial reporting purposes differ from the amount computed by applying the statutory federal rate primarily due to the effect of state income taxes, net of federal benefit, permanent differences, the change in the valuation allowance related to certain state net operating losses, and re-measurement of net deferred tax liabilities . In fiscal 2017, the Company made an election under Section 338 (h)(10) of the Internal Revenue Code which effectively changed the tax treatment of the Company’s acquisition of Gypsum Supply Company from a stock transaction to an asset transaction for tax purposes. As a result of this election, the Company decreased its deferred tax liabilities and tax expense by $6.9 million. NOLs . During recent tax years, the Company generated certain state net operating loss carry‑forwards which are available for use against taxable income in each respective state. The Company had gross state net operating losses available for carry‑forward of $20.4 million and $21.1 million in fiscal 2018 and 2017, respectively, which expire through the fiscal year ending in 2038. Valuation allowance. Deferred tax assets and liabilities are computed by applying the federal and state income tax rates in effect to the gross amounts of temporary differences and other tax attributes, such as net operating loss carry‑forwards. In assessing if the deferred tax assets will be realized, the Company considers whether it is more likely than not that some or all of these deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the period in which these deductible temporary differences reverse. As of April 30, 2018, except as noted in the following paragraph, the Company believes that it is more likely than not that all of its deferred tax assets relating to separate company state return filings will be realized. The tax credits, carryforwards and net operating losses expire from 2019 to 2038. Management makes an assessment to determine if its deferred tax assets are more likely than not to be realized. Valuation allowances are established in the event that management believes that it is more likely than not the related tax benefits will not be realized. The valuation allowance as of April 30, 2018 and 2017 was $0.4 million and $0.3 million, respectively, and primarily relates to state net operating loss carry forwards. During fiscal 2018, the valuation allowance increased by $0.1 million due to additional NOL carryforwards. Uncertain tax positions. The Company recognizes the effect of income tax positions only if those positions are more likely than not to be sustained. The Company’s policy for recording penalties and interest associated with uncertain tax positions is to record such items as a component of selling, general and administrative expense. The Company had no reserve for uncertain tax positions as of April 30, 2018 and 2017. As of April 30, 2018, the tax years ended April 30, 2018, 2017, 2016 and 2015 remain subject to examination by the U.S. Internal Revenue Service. In states in which the Company conducts business, the statute of limitation periods for examination generally vary from three to four years. Net operating losses dating back to 2007 are still being carried forward and remain subject to examination by the taxing authorities. The Company regularly assesses the potential outcomes of future examinations to ensure the Company’s provision for income taxes is sufficient. The Company recognizes liabilities based on estimates of whether additional taxes will be due and believes that no liability for uncertain tax position is necessary as of April 30, 2018 and 2017. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Apr. 30, 2018 | |
Stockholders’ Equity | |
Stockholders’ Equity | 9. Stockholders’ Equity During the year ended April 30, 2016, the Company repurchased 0.4 million shares of its common stock at a cost of $5.8 million in connection with its separation agreement with a former employee. The Company then reissued these shares for proceeds of $4.9 million. The difference between the cost of the treasury stock and the proceeds from its reissuance was accounted for using the “cost” method as an increase to retained earnings of $1.0 million. The Company did not have any treasury stock activity during the years ended April 30, 2018 or 2017. |
Equity-Based Compensation
Equity-Based Compensation | 12 Months Ended |
Apr. 30, 2018 | |
Equity-Based Compensation | |
Equity-Based Compensation | 10. Equity‑Based Compensation General The Company has granted options to purchase the Company’s common stock under its 2014 GYP Holdings I Corp. Stock Option Plan. The stock options granted under this plan vest over a four-year period and have a 10-year term. In October 2017, the shareholders of the Company approved the GMS Inc. Equity Incentive Plan (the “Equity Incentive Plan”). Grants subsequent to October 2017 will be made from the Equity Incentive Plan. The Equity Incentive Plan is administered by a committee of the Board of Directors, which determines the terms of the awards granted. Under the Equity Incentive Plan, the committee may grant various forms of equity-based incentive compensation, including stock options, stock appreciation rights, restricted stock, restricted stock units and performance awards, among others. The Company’s Equity Incentive Plan provides for the issuance of a maximum of 2.5 million shares, of which approximately 2.4 million shares were still available for grant as of April 30, 2018 . The Company intends to use authorized and unissued shares to satisfy share award exercises. Share-based compensation expense related to stock options and restricted stock units was $1.7 million, $2.4 million and $2.7 million during the years ended April 30, 2018, 2017 and 2016, respectively, and is included in selling, general and administrative expenses in the Consolidated Statements of Operations and Comprehensive Income. Stock Option Awards The following table presents stock option activity as of and for the year ended April 30, 2018: Weighted Weighted Average Average Remaining Aggregate Number of Exercise Contractual Intrinsic Options Price Life (years) Value (shares and dollars in thousands) Outstanding as of April 30, 2017 2,088 $ 13.49 7.23 $ 47,336 Options granted 63 37.49 Options exercised (199) 12.53 Options forfeited — — Options expired — — Outstanding as of April 30, 2018 1,952 $ 14.37 6.52 $ 33,209 Exercisable as of April 30, 2018 1,682 $ 12.97 6.31 $ 30,599 Vested and expected to vest as of April 30, 2018 1,946 $ 14.33 6.52 $ 33,173 The aggregate intrinsic value represents the value of the Company’s closing stock price on the last trading day of the period in excess of the weighted average exercise price multiplied by the number of options outstanding, exercisable or expected to vest. Options expected to vest are unvested shares net of expected forfeitures. The total intrinsic value of options exercised during the years ended April 30, 2018, 2017 and 2016 was $4.3 million, $0.6 million and $8.9 million, respectively. As of April 30, 2018 , there was $1.1 million of total unrecognized compensation cost related to stock options. That cost is expected to be recognized over a weighted-average period of 2.1 years. There were no stock options granted during the year ended April 30, 2016. The fair value of stock options granted during the years ended April 30, 2018 and 2017 was estimated using the Black-Scholes option-pricing model with the following assumptions: Year Ended April 30, 2018 2017 Volatility 30.86 % 40.68 % Expected life (years) Risk-free interest rate 2.18 % 1.55 % Dividend yield — % — % The weighted average grant date fair value of options granted during the years ended April 30, 2018 and 2017 was $12.81 per share and $9.68 per share, respectively. The expected volatility was based on the average volatility of peer public entities that are similar in size and industry since prior to our IPO discussed in Note 1, “ — Initial and Secondary Public Offerings,” we did not have sufficient history to estimate the expected volatility of our common stock price. The expected life of stock options was based on previous history of exercises. The risk‑free rate was based on the U.S. Treasury yield curve in effect at the time of grant for the expected term of the stock option. The expected dividend yield was 0% as we have not declared any common stock dividends to date and do not expect to declare common stock dividends in the near future. The fair value of the underlying common stock at the date of grant was determined based on the value of the Company’s closing stock price on the trading day immediately preceding the date of the grant. Restricted Stock Units During the year ended April 30, 2018, the Company granted 21,766 restricted stock units to employees pursuant to its Equity Incentive Plan. All of these awards were outstanding as of April 30, 2018. The restricted stock units vest ratably over three years and have a fair value of $37.49 per unit. The Company did not grant any restricted stock units during the years ended April 30, 2017 or 2016. As of April 30, 2018, there was $0.7 million of total unrecognized compensation cost related to nonvested restricted stock units. That cost is expected to be recognized over a weighted-average period of 2.6 years. |
Stock Appreciation Rights, Defe
Stock Appreciation Rights, Deferred Compensation and Redeemable Noncontrolling Interests | 12 Months Ended |
Apr. 30, 2018 | |
Stock Appreciation Rights, Deferred Compensation and Redeemable Noncontrolling Interests | |
Stock Appreciation Rights, Deferred Compensation and Redeemable Noncontrolling Interests | 11. Stock Appreciation Rights, Deferred Compensation and Redeemable Noncontrolling Interests The following table presents a summary of changes to the liabilities for stock appreciation rights, deferred compensation and redeemable noncontrolling interests for the years ended April 30, 2018 and 2017: Stock Appreciation Deferred Noncontrolling Rights Compensation Interests (in thousands) Balance as of April 30, 2016 $ 20,533 $ 3,270 $ 26,585 Redemption notes (28) — (5,354) Change in fair value 157 480 3,078 Balance as of April 30, 2017 20,662 3,750 24,309 Amounts redeemed (1,036) (1,733) (9,664) Change in fair value 2,318 205 1,525 Balance as of April 30, 2018 $ 21,944 $ 2,222 $ 16,170 Classified as current as of April 30, 2017 $ 878 $ 300 $ 1,733 Classified as long-term as of April 30, 2017 19,784 3,450 22,576 Classified as current as of April 30, 2018 308 133 463 Classified as long-term as of April 30, 2018 21,636 2,089 15,707 Total expense related to these instruments was $4.0 million, $3.7 million and $2.9 million during the years ended April 30, 2018, 2017 and 2016, respectively, and was included in selling, general and administrative expenses in the Consolidated Statements of Operations and Comprehensive Income. During the year ended April 30, 2016, the Company recorded a $11.2 million increase to accumulated deficit, a $0.2 million decrease to accumulated deficit and a $3.7 million decrease to accumulated deficit in the Consolidated Balance Sheets for the stock appreciation rights, deferred compensation and redeemable noncontrolling interests, respectively, as a result of the change in value due to the transition guidance for share-based compensation. Stock Appreciation Rights Certain subsidiaries have granted stock appreciation rights to certain employees under which payments are dependent on the appreciation in the book value per share, adjusted for certain provisions, of the applicable subsidiary. Settlements of the awards can be made in a combination of cash or installment notes, generally paid over four years, upon a triggering event. As of April 30, 2018, all stock appreciation rights were vested. Deferred Compensation Subsidiaries’ stockholders have entered into other deferred compensation agreements that granted the stockholders a payment based on a percentage in excess of book value, adjusted for certain provisions, upon an occurrence as defined in the related agreements, which are called “Buy Sell” agreements. These instruments are redeemed in cash or installment notes, generally paid in annual installments generally over the five years following termination of employment. Redeemable Noncontrolling Interests Noncontrolling interests were issued to certain employees of the subsidiaries. All of the noncontrolling interest awards are subject to mandatory redemption on termination of employment for any reason. These instruments are redeemed in cash or installment notes, generally paid in annual installments over the five years following termination of employment. Liabilities related to these agreements are classified as share-based liability awards and are measured at intrinsic value. Intrinsic value is determined to be the stated redemption value of the shares. Under the terms of the employee agreements, the redemption value is determined based on the book value of the subsidiary, as adjusted for certain items. Upon the termination of employment or other triggering events including death or disability of the noncontrolling stockholders in the Company’s subsidiaries, we are obligated to purchase, or redeem, the noncontrolling interests at either an agreed upon price or a formula value provided in the stockholder agreements. This formula value is typically based on the book value per share of the subsidiary’s equity, including certain adjustments. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Apr. 30, 2018 | |
Fair Value Measurements | |
Fair Value Measurements | 12. Fair Value Measurements Assets and Liabilities Measured at Fair Value on a Recurring Basis The following table presents the estimated carrying amount and fair value of the Company’s assets and liabilities measured at fair value on a recurring basis as of April 30, 2018 and 2017: April 30, April 30, 2018 2017 (in thousands) Assets: Interest rate cap (Level 2) $ 543 $ 88 Liabilities: Forward currency forward (Level 2) $ 5,108 $ — Stock appreciation rights (Level 3) 21,944 20,662 Deferred Compensation (Level 3) 2,222 3,750 Noncontrolling interest holders (Level 3) 16,170 24,309 Derivative instruments . The fair value of derivative instruments is determined using Level 2 inputs. Generally, the Company obtains the Level 2 inputs from its counterparties. Substantially all of the inputs are observable in the marketplace throughout the full term of the instruments, which can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace. The fair value of the Company’s interest rate cap is determined using widely accepted valuation techniques including a discounted cash flow analysis on the expected cash flows of the derivative. This analysis reflected the contractual terms of the derivatives, including the period to maturity, and used observable market‑based inputs, including interest rate curves and implied volatilities. The fair value of the Company’s forward currency forward contract is based on observable market inputs, such as forward rates in active markets. Stock appreciation rights, deferred compensation and redeemable noncontrolling interests . The fair values of stock appreciation rights, deferred compensation and redeemable noncontrolling interests are determined using Level 3 inputs. These inputs include a volatility rate based on comparable entities, a discount rate, the expected time to redemption of the liabilities, historical values of the book equity of certain subsidiaries and market information for comparable entities. The use of these inputs to derive the fair value of the liabilities at a point in time can result in volatility to the financial statements. See Note 11, “Stock Appreciation Rights, Deferred Compensation and Redeemable Noncontrolling Interests,” for a reconciliation of the beginning and ending balances. Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis Disclosures are required for certain assets and liabilities that are measured at fair value on a nonrecurring basis in periods subsequent to initial recognition. Such measurements of fair value relate primarily to assets and liabilities measured at fair value in connection with business combinations and long-lived asset impairments. For more information on business combinations, see Note 2, “Business Acquisitions.” There were no material long-lived asset impairments during the years ended April 30, 2018, 2017 or 2016. |
Transactions With Related Parti
Transactions With Related Parties | 12 Months Ended |
Apr. 30, 2018 | |
Transactions With Related Parties | |
Transactions With Related Parties | 13. Transactions With Related Parties The Company leases warehouse facilities from partnerships owned by certain stockholders of GMS Inc. and its subsidiaries. As of April 30, 2018, these leases had expiration dates through fiscal 2025. Rent expense related to these leases was $0.8 million, $0.8 million and $0.6 million during the years ended April 30, 2018, 2017 and 2016, respectively, and are included in selling, general and administrative expenses in the Consolidated Statements of Operations and Comprehensive Income. As of April 30, 2018, future minimum payments under the terms of the leases aggregated to $2.0 million. The Company purchases inventories from Southern Wall Products, Inc. (“SWP”) on a continuing basis. Certain stockholders of the Company are stockholders of SWP. The Company purchased inventory from SWP for distribution in the amount of $14.0 million $13.0 million and $12.8 million during the years ended April 30, 2018, 2017 and 2016, respectively. Amounts due to SWP for purchases of inventory for distribution as of April 30, 2018 and 2017 were $1.2 million and $1.1 million, respectively, and are included in accounts payable in the Consolidated Balance Sheets. In connection with the IPO, the Company terminated its management agreement with AEA. The agreement required the Company to pay AEA an annual management fee of $2.3 million per year following the Acquisition for advisory and consulting services. The fee was payable in quarterly installments of $0.6 million in advance of the upcoming calendar quarter on the first day, and is included in selling, general and administrative expenses in the Consolidated Statements of Operations and Comprehensive Income. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Apr. 30, 2018 | |
Commitments and Contingencies | |
Commitments and Contingencies | 14. Commitments and Contingencies Lease Commitments The Company is obligated under certain capital leases covering its fleet of vehicles as well as one facility. The fleet vehicle leases have terms ranging from one to six years and the facility lease has a term of eleven years. T he carrying value of property and equipment under capital leases was $17.9 million and $15.0 million as of April 30, 2018 and 2017, respectively, net of accumulated depreciation of $10.3 million and $8.3 million, respectively. The Company also has certain noncancelable operating lease agreements, primarily office and warehouse facilities and equipment. These leases generally contain renewal options for periods ranging from one to five years. Rent expense for operating leases, which may have escalating rents over the terms of the leases, is recorded on a straight‑line basis over the minimum lease terms. Rent expense under operating leases, including amounts paid to affiliated partnerships, approximated $63.9 million, $56.2 million and $41.7 million during the years ended April 30, 2018, 2017 and 2016, respectively. As existing leases expire, the Company anticipates such leases will be renewed or replaced with other leases that are substantially similar in terms and rental amounts which are consistent with market rates at the time of renewal. As of April 30, 2018, the approximate amounts of the annual future minimum lease payments under noncancelable operating leases, including amounts payable to affiliated partnerships, and future maturities of capital lease obligations are as follows (in thousands): Capital Operating Year Ended April 30, 2019 $ 7,289 $ 59,529 2020 5,665 52,815 2021 3,882 43,120 2022 1,937 29,299 2023 1,147 17,820 Thereafter 571 13,601 $ 20,491 $ 216,184 Less: Interest 1,927 Capitalized lease obligations $ 18,564 Litigation, Claims and Assessment The Company is a defendant in various lawsuits and administrative actions associated with personal injuries, claims of former employees, and other events arising in the normal course of business. As discussed in Note 1, “—Insurance Liabilities”, the Company records liabilities for these claims, as well as assets for amounts recoverable from the insurer, for these claims covered by insurance. |
Segments
Segments | 12 Months Ended |
Apr. 30, 2018 | |
Segments | |
Segments | 15. Segments General The Company has six operating segments based on geographic operations that it aggregates into one reportable segment. The Company defines operating segments as components of the organization for which discrete financial information is available and operating results are evaluated on a regular basis by the Chief Operating Decision Maker (“CODM”) in order to assess performance and allocate resources . The Company’s CODM is its Chief Executive Officer. The Company determined it has six operating segments based on the Company’s six geographic divisions, which are Central, Midwest, Northeast, Southern, Southeast and Western. On May 1, 2017, the Company combined the Southern and Southwest into the Southern operating segment, which resulted in a reduction (from seven to six) in the number of operating segments. The Company aggregates its operating segments into a single reportable segment based on similarities between the operating segments’ economic characteristics, nature of products sold, production process, type of customer and methods of distribution. The accounting policies of the operating segments are the same as those described in the summary of significant policies. In addition to the Company’s reportable segment, the Company’s consolidated results include both corporate activities and certain other activities. Corporate includes the Company’s corporate office building and support services provided to its subsidiaries. Other includes Tool Source Warehouse, Inc., which functions primarily as an internal distributor of tools. As of April 30, 2018, the Company did not earn revenues or have long‑lived assets located in foreign countries. Segment Results The CODM assesses the Company’s performance based on the periodic review of net sales, Adjusted EBITDA and certain other measures for each of the operating segments. Adjusted EBITDA is not a recognized financial measure under GAAP. However, we believe it assists investors and analysts in comparing our operating performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance. Management believes Adjusted EBITDA is helpful in highlighting trends in our operating results, while other measures can differ significantly depending on long‑term strategic decisions regarding capital structure, the tax jurisdictions in which companies operate and capital investments. In addition, we utilize Adjusted EBITDA in certain calculations under the ABL Facility and the First Lien Facility. The ABL Facility and the First Lien Facility permit us to make certain additional adjustments in calculating Consolidated EBITDA, such as projected net cost savings, which are not reflected in the Adjusted EBITDA data presented in this Annual Report on Form 10‑K. The following tables present segment results for the years ended April 30, 2018, 2017 and 2016: Year Ended April 30, 2018 April 30, 2018 Depreciation and Adjusted Total Net Sales Gross Profit Amortization EBITDA Assets (in thousands) Geographic divisions $ 2,487,557 $ 809,884 $ 64,491 $ 196,903 $ 1,434,371 Other 23,912 8,692 242 2,355 12,854 Corporate — — 797 — 7,286 $ 2,511,469 $ 818,576 $ 65,530 $ 199,258 $ 1,454,511 Year Ended April 30, 2017 April 30, 2017 Depreciation and Adjusted Total Net Sales Gross Profit Amortization EBITDA Assets (in thousands) Geographic divisions $ 2,298,871 $ 750,564 $ 68,001 $ 186,155 $ 1,376,655 Other 20,275 8,007 310 2,074 11,916 Corporate — — 929 — 4,694 $ 2,319,146 $ 758,571 $ 69,240 $ 188,229 $ 1,393,265 Year Ended April 30, 2016 April 30, 2016 Depreciation and Adjusted Total Net Sales Gross Profit Amortization EBITDA Assets (in thousands) Geographic divisions $ 1,842,634 $ 587,213 $ 63,093 $ 137,459 $ 1,217,871 Other 15,548 5,951 295 724 12,310 Corporate — — 827 — 10,633 $ 1,858,182 $ 593,164 $ 64,215 $ 138,183 $ 1,240,814 The following table presents a reconciliation of net income to Adjusted EBITDA for the years ended April 30, 2018, 2017 and 2016: Year Ended April 30, 2018 2017 2016 (in thousands) Net income $ 62,971 $ 48,886 $ 12,564 Interest expense 31,395 29,360 37,418 Write-off of debt discount and deferred financing fees 74 7,103 — Interest income (177) (152) (928) Income tax expense 20,883 22,654 12,584 Depreciation expense 24,075 25,565 26,667 Amortization expense 41,455 43,675 37,548 Stock appreciation expense(a) 2,318 148 1,988 Redeemable noncontrolling interests(b) 1,868 3,536 880 Equity-based compensation(c) 1,695 2,534 2,699 Severance and other permitted costs(d) 581 (157) 379 Transaction costs (acquisitions and other)(e) 3,370 2,249 3,751 Gain on sale of assets (509) (338) (645) Management fee to related party(f) — 188 2,250 Effects of fair value adjustments to inventory(g) 324 946 1,009 Change in fair value of financial instruments(h) 6,125 382 19 Secondary public offering costs(i) 1,525 1,385 — Debt transaction costs(j) 1,285 265 — Adjusted EBITDA $ 199,258 $ 188,229 $ 138,183 (a) Represents non‑cash expense related to stock appreciation rights agreements. (b) Represents non‑cash compensation expense related to changes in the redemption values of noncontrolling interests. (c) Represents non‑cash equity‑based compensation expense related to the issuance of share-based awards. (d) Represents severance expenses and other costs permitted in calculations under the ABL Facility and the First Lien Facility. (e) Represents one‑time costs related to our IPO and acquisitions paid to third party advisors. (f) Represents management fees paid by us to AEA. Following our IPO, AEA no longer receives management fees from us. (g) Represents the non‑cash cost of sales impact of purchase accounting adjustments to increase inventory to its estimated fair value. (h) Represents the mark‑to‑market adjustments for derivative financial instruments. (i) Represents one-time costs related to our secondary offering paid to third-party advisors. (j) Represents expenses paid to third party advisors related to debt refinancing activities. Revenues by Product The following table presents Company’s net sales to external customers by main product lines for the years ended April 30, 2018, 2017 and 2016: Year Ended April 30, 2018 2017 2016 (in thousands) Wallboard $ 1,109,552 $ 1,058,400 $ 870,952 Ceilings 387,360 341,007 297,110 Steel framing 411,630 374,151 281,340 Other products 602,927 545,588 408,780 Total net sales $ 2,511,469 $ 2,319,146 $ 1,858,182 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive (Loss) Income | 12 Months Ended |
Apr. 30, 2018 | |
Accumulated Other Comprehensive (Loss) Income | |
Accumulated Other Comprehensive (Loss) Income | 16. Accumulated Other Comprehensive (Loss) Income The following table sets forth the changes to accumulated other comprehensive (loss) income, net of tax, by component for the years ended April 30, 2018, 2017 and 2016: Gain (Loss) On Interest Rate Cap (in thousands) Accumulated other comprehensive income as of April 30, 2015 $ 10 Other comprehensive loss before reclassification (1,177) Reclassification to earnings from accumulated other comprehensive (loss) income(1) 19 Accumulated other comprehensive loss as of April 30, 2016 (1,148) Other comprehensive loss before reclassification (118) Reclassification to earnings from accumulated other comprehensive (loss) income(1) 382 Accumulated other comprehensive loss as of April 30, 2017 (884) Other comprehensive gain before reclassification 309 Reclassification to earnings from accumulated other comprehensive (loss) income(1) 1,016 Accumulated other comprehensive income as of April 30, 2018 $ 441 (1) Amounts are recorded as a component of change in other comprehensive income in the Consolidated Statements of Operations. (Decrease) increase in fair value of financial instruments, net of tax, recorded in accumulated other comprehensive income (loss) is reclassified to earnings as each of the hedged forecasted transactions occur. During the next twelve months, the Company expects to reclassify approximately $0.7 million, net of tax, to earnings. |
Earnings Per Common Share
Earnings Per Common Share | 12 Months Ended |
Apr. 30, 2018 | |
Earnings Per Common Share | |
Earnings Per Common Share | 17. Earnings Per Common Share The following table sets forth the computation of basic and diluted earnings per share of common stock for the years ended April 30, 2018, 2017 and 2016: Year Ended April 30, 2018 2017 2016 (in thousands, except per share data) Net income $ 62,971 $ 48,886 $ 12,564 Basic earnings per common share: Basic weighted average common shares outstanding 41,015 40,260 32,799 Basic earnings per common share $ 1.54 $ 1.21 $ 0.38 Diluted earnings per common share: Basic weighted average common shares outstanding 41,015 40,260 32,799 Add: Common Stock Equivalents 1,148 810 326 Diluted weighted average common shares outstanding 42,163 41,070 33,125 Diluted earnings per common share $ 1.49 $ 1.19 $ 0.38 |
Condensed Parent Company Financ
Condensed Parent Company Financial Information | 12 Months Ended |
Apr. 30, 2018 | |
Condensed Parent Company Financial Information | |
Condensed Parent Company Financial Information | 18. Condensed Parent Company Financial Information On a standalone basis, the Company has no material assets or operations other than its ownership in GYP Holdings II Corp., which in turn has no material assets or operations other than its ownership in GYP Holdings III Corp. GYP Holdings III Corp. is the Lead Borrower under the ABL Facility and the Borrower under the Term Loan Facilities, all of which contain significant restrictions on the Company’s ability to obtain funds from GYP Holdings III Corp. or any of GYP Holdings III Corp.’s subsidiaries through dividends, loans or advances. Accordingly, the following condensed financial information has been presented on a “Parent‑only” basis. Under a “Parent‑only” presentation, the Company’s investments in its consolidated subsidiaries are presented under the equity method of accounting using the same accounting principles and policies described in the notes to the Consolidated Financial Statements. The following tables present the Parent Company’s financial position as of April 30, 2018 and 2017 and results of operations during the years ended April 30, 2018, 2017 and 2016: GMS Inc. Condensed Parent Company Balance Sheets April 30, 2018 2017 (in thousands) Investment in subsidiary $ 579,451 $ 514,606 Total assets 579,451 514,606 Stockholders’ equity: Common stock, $0.01 par value, authorized 500,000 shares; 41,069 and 40,971 shares issued and outstanding as of April 30, 2018 and 2017, respectively 411 410 Additional paid-in capital 489,007 488,459 Accumulated deficit 89,592 26,621 Accumulated other comprehensive income 441 (884) Total stockholders’ equity $ 579,451 $ 514,606 GMS Inc. Condensed Parent Company Statements of Operations and Comprehensive Income Year Ended April 30, 2018 2017 2016 (in thousands) Net income in subsidiaries $ 62,971 $ 48,886 $ 12,564 Net income 62,971 48,886 12,564 Comprehensive income 64,296 49,150 11,406 Weighted average shares outstanding: Basic 41,015 40,260 32,799 Diluted 42,163 41,070 33,125 Net income per share Basic $ 1.54 $ 1.21 $ 0.38 Diluted $ 1.49 $ 1.19 $ 0.38 There were no cash flows for GMS Inc. during the years ended April 30, 2018, 2017 and 2016 as there were no dividends, loans or advances between GMS Inc. and its subsidiaries. As of April 30, 2018, restricted net assets of the Company’s consolidated subsidiaries was $578.0 million. During the years ended April 30, 2018, 2017 and 2016, the Company’s consolidated subsidiaries did not pay any cash dividends to the Company. |
Valuation and Qualifying Accoun
Valuation and Qualifying Accounts | 12 Months Ended |
Apr. 30, 2018 | |
Valuation and Qualifying Accounts | |
Valuation and Qualifying Accounts | 19. Valuation and Qualifying Accounts Allowance for Doubtful Accounts Rollforward Balance Charged to Balance at Beginning Other at End of of Period Provision Accounts(a) Deductions Period (in thousands) Fiscal Year Ended April 30, 2018 $ (9,851) $ (366) $ (596) $ 1,180 $ (9,633) Fiscal Year Ended April 30, 2017 (8,607) (1,792) (819) 1,367 (9,851) Fiscal Year Ended April 30, 2016 (8,633) (908) 77 857 (8,607) (a) Charged to other accounts represents the net (increase) decrease for specifically reserved accounts, as well as the net change in reserves for sales discounts, service charges and sales returns. Valuation Allowance on Deferred Tax Assets Rollforward Balance Additions Balance at Beginning Charged to Costs at End of of Period and Expenses Deductions Period (in thousands) Fiscal Year Ended April 30, 2018 $ (297) $ (151) $ — $ (448) Fiscal Year Ended April 30, 2017 (83) (255) 41 (297) Fiscal Year Ended April 30, 2016 (143) (38) 98 (83) |
Selected Quarterly Financial Da
Selected Quarterly Financial Data (Unaudited) | 12 Months Ended |
Apr. 30, 2018 | |
Selected Quarterly Financial Data (Unaudited) | |
Selected Quarterly Financial Data (Unaudited) | 20. Selected Quarterly Financial Data (Unaudited) The following table sets forth certain unaudited financial information for each quarter of the years ended April 30, 2018 and 2017. The unaudited quarterly information includes all adjustments (consisting of normal recurring adjustments) that, in the opinion of management, are necessary for the fair presentation of the information presented. Year Ended April 30, 2018 First Second Third Fourth Quarter Quarter Quarter Quarter (in thousands, except per share data) Net sales $ 642,157 $ 648,004 $ 585,508 $ 635,800 Gross profit 205,104 212,260 195,420 205,792 Net income(1) 15,343 18,023 19,686 9,919 Per share data Weighted average shares outstanding(2): Basic 40,971 41,006 41,036 41,048 Diluted 42,128 42,146 42,228 42,151 Net income per share(2): Basic $ 0.37 $ 0.44 $ 0.48 $ 0.24 Diluted $ 0.36 $ 0.43 $ 0.47 $ 0.24 Year Ended April 30, 2017 First Second Third Fourth Quarter Quarter Quarter Quarter (in thousands, except per share data) Net sales $ 549,800 $ 591,846 $ 562,523 $ 614,977 Gross profit 178,585 193,224 185,727 201,035 Net income 9,163 17,224 8,226 14,273 Per share data Weighted average shares outstanding(2): Basic 38,201 40,943 40,943 40,956 Diluted 38,602 41,320 41,578 41,759 Net income per share(2): Basic $ 0.24 $ 0.42 $ 0.20 $ 0.35 Diluted $ 0.24 $ 0.42 $ 0.20 $ 0.33 (1) Net income for the third quarter of 2018 includes a $7.8 million provisional income tax benefit for the re-measurement of deferred tax assets and liabilities in connection with the Tax Act. Net income for the fourth quarter of 2018 includes a $5.1 million loss on change in fair value of financial instruments related to the Company’s foreign currency forward contract and a $1.1 million decrease to the provisional income tax benefit recorded during the third quarter of 2018. (2) Basic and diluted net income per share are computed independently for each of the quarters presented. Therefore, the sum of the quarterly basic and diluted net income per share amounts may not equal annual basic and diluted net income per share amounts. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Apr. 30, 2018 | |
Subsequent Events | |
Subsequent Events | 21. Subsequent Events Acquisition of Titan On June 1, 2018, we acquired all of the outstanding equity interests of WSB Titan (“Titan”) , a distributer of drywall, lumber, commercial and residential building materials. Titan is Canada’s largest gypsum specialty distributer with 30 locations across five provinces in Canada. T he aggregate purchase price was $627.0 million (subject to a working capital and certain other adjustments as set forth in the Securities Purchase Agreement). As part of the consideration, certain members of existing management converted $35.0 million of their ownership position in Titan into equity that is exchangeable for the Company’s stock. The purpose of the transaction is to extend the Company’s leadership position in North America with expanded scale and footprint, expand its geographic coverage into the Canadian market and create opportunities for product expansion in both the U.S. and Canada. To finance this transaction, on June 1, 2018, the Company entered into a Third Amendment to its First Lien Credit Agreement (the “Third Amendment”) that provides for a new first lien term loan facility under the Credit Agreement in the aggregate principal amount of $996.8 million due in June 2025 that bears interest at a floating rate based on LIBOR plus 2.75%, representing a 25 basis point improvement compared to the interest rate of the existing first lien term loan facility under the Credit Agreement immediately prior to giving effect to the Third Amendment. The Company also drew down $143.0 million under its ABL facility. The net proceeds from the new first lien term loan facility, ABL facility and cash on hand were used to repay the Company’s existing first lien term loan facility of approximately $571.8 million under the Credit Agreement and to finance the Titan acquisition. The assets acquired and liabilities assumed of Titan will be recognized at their acquisition date fair values. The allocation of the consideration transferred to the assets acquired and liabilities assumed of Titan (and the related estimated lives of depreciable tangible and identifiable intangible assets) will require a significant amount of judgment. As of the date of this filing, the accounting for the business combination was incomplete and a preliminary allocation of the consideration transferred could not be made due to complexities regarding the deferred tax liabilities. Such preliminary allocation of the purchase price is expected to be complete in the first quarter of fiscal year 2019 and will be determined taking into account analysis by an independent valuation firm. If the Titan acquisition had occurred on May 1, 2017, the Company would have included net sales of Titan of $478.4 million for the year ended April 30, 2018 and net income of Titan of $11.9 million for the year ended April 30, 2018, resulting in pro forma net sales of $2,989.9 million and pro forma net income of $74.9 million for the year ended April 30, 2018. Operating Lease Amendments During the first quarter of fiscal year 2019, the Company amended certain of its operating lease agreements for equipment. The amendments resulted in the Company classifying these operating leases as capital leases as of the date of the modifications. As a result, the Company recorded $73.6 million of capital lease assets and capital lease liabilities in its Consolidated Balance Sheet during the first quarter of fiscal year 2019. |
Business, Basis of Presentati28
Business, Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Apr. 30, 2018 | |
Business, Basis of Presentation and Summary of Significant Accounting Policies | |
Initial and Secondary Public Offerings | Initial and Secondary Public Offerings On June 1, 2016, we completed an initial public offering (“IPO”) of 8.1 million shares of common stock at a price of $21.00 per share, including 1.1 million shares of common stock that were issued as a result of the exercise in full by the underwriters of an option to purchase additional shares to cover over‑allotments. After underwriting discounts and commissions, but before expenses, we received net proceeds from the IPO of approximately $156.9 million. We used these proceeds together with cash on hand to repay $160.0 million principal amount of our term loan debt outstanding under our senior secured second lien term loan facility, which was a payment in full of the entire loan balance due under our senior secured second lien term loan facility. On February 28, 2017, certain of our stockholders completed a secondary public offering of 8.0 million shares of the Company’s common stock at a price to the public of $29.25 per share, including 1.0 million shares of common stock that were sold as a result of the exercise in full by the underwriters of an option to purchase additional shares that was granted by the selling stockholders. We did not receive any proceeds from the sale of our common stock by the selling stockholders. On June 7, 2017, certain of our stockholders completed an additional secondary public offering of 5.8 million shares of the Company’s common stock at a price to the public of $33.00 per share, including 0.8 million shares of common stock that were sold as a result of the exercise in full by the underwriters of an option to purchase additional shares that was granted by the selling stockholders. As a result of such offering, the control group consisting of certain affiliates of AEA Investors LP (“AEA”) and certain other of our stockholders no longer controlled a majority of the voting power of our outstanding common stock. Accordingly, we are no longer a “controlled company” within the meaning of the New York Stock Exchange corporate governance standards. We did not receive any proceeds from the sale of our common stock by the selling stockholders. On December 14, 2017, certain of our stockholders completed an additional secondary public offering of 5.0 million shares of the Company’s common stock at a price to the public of $38.25 per share. We did not receive any proceeds from the sale of our common stock by the selling stockholders. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements of the Company include the accounts of its wholly-owned subsidiaries. All material intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Reclassifications | Reclassifications Certain amounts in the prior year financial statements have been reclassified to conform to the current year presentation. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. |
Trade Accounts Receivable | Trade Accounts Receivable Accounts receivables are recorded at their net realizable value. The Company maintains an allowance for doubtful accounts for estimated losses due to the failure of customers to make required payments, as well as allowances for sales returns and cash discounts. The Company’s estimate of the allowance for doubtful accounts is based on an assessment of individual past due accounts, historical write‑off experience, accounts receivable aging and current economic trends. Account balances are written off when the potential for recovery is considered remote. The Company’s estimates of sales returns and cash discounts are based on an analysis of historical information. |
Inventories | Inventories Inventories consist of finished goods purchased for resale and include wallboard, ceilings, steel framing and other specialty building products. Inventories are valued at the lower of cost or market (net realizable value). The cost of inventories is determined by the moving average cost method. We monitor our inventory levels and record provisions for excess inventories based on slower moving inventory. In addition, at the end of each year, we evaluate our inventory at each branch and write off and dispose of obsolete products. Our inventories are generally not susceptible to technological obsolescence. |
Property and Equipment | Property and Equipment Property and equipment is recorded at cost less accumulated depreciation . Property and equipment obtained through acquisition are stated at estimated fair value as of the acquisition date. Expenditures for improvements and betterments are capitalized, while the costs of maintenance and repairs are charged to operating expense as incurred. Gains and losses related to the sale of property and equipment are recorded in selling, general and administrative expenses in the Consolidated Statements of Operations and Comprehensive Income. Depreciation expense is determined using the straight-line method over the estimated useful lives of the various asset classes. The estimated useful lives of property and equipment are as follows: Buildings 25 - 39 years Furniture, fixtures and automobiles 3 - 5 years Warehouse and delivery equipment 4 - 10 years Leasehold improvements Shorter of estimated useful life or lease term |
Goodwill | Goodwill Goodwill is the excess of the purchase price over the fair value of identifiable net assets acquired in business combinations accounted for under the acquisition method of accounting. The Company does not amortize goodwill. The Company tests its goodwill annually during the fourth quarter of its fiscal year or when events and circumstances indicate that those assets might not be recoverable. Impairment testing of goodwill is required at the reporting unit level (operating segment or one level below operating segment) and involves a two-step process. Prior to performing the two-step impairment test, the Company may make a qualitative assessment of the likelihood of goodwill impairment in order to determine whether a detailed quantitative analysis is required. The first step of the impairment test involves comparing the estimated fair values of the Company’s reporting units with the reporting units’ carrying amounts, including goodwill. If the carrying amount of the reporting unit exceeds its fair value, a second step is performed to compare the carrying amount of goodwill to the implied fair value of that goodwill. If the carrying amount of goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to the excess. |
Intangible Assets | Intangible Assets Intangible assets consist of customer relationships, trade names and other assets acquired in conjunction with the purchases of businesses or purchases of assets from other companies. The Company typically uses an income method to estimate the fair value of intangible assets, which is based on forecasts of the expected future cash flows attributable to the respective assets. When management determines material intangible assets are acquired in conjunction with the purchase of a business, the Company determines the fair values of the identifiable intangible assets by taking into account management’s own analysis and an independent third-party valuation specialist’s appraisal. Intangible assets determined to have definite lives are amortized over their estimated useful lives. |
Long-Lived Assets | Long-Lived Assets The Company evaluates the recoverability of long-lived assets, including property and equipment and intangible assets, for impairment when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Conditions that would necessitate an impairment assessment include a significant decline in the observable market value of an asset, a significant change in the extent or manner in which an asset is used or a significant adverse change that would indicate the carrying amount of an asset or group of assets is not recoverable. For long-lived assets to be held and used, the Company recognizes an impairment loss if its carrying amount is not recoverable through its undiscounted cash flows and measures the impairment loss, if any, based on the difference between the carrying amount and fair value. Long-lived assets held for sale are reported at the lower of cost or fair value less costs to sell and are recorded within prepaid expenses and other current assets in the Consolidated Balance Sheets. The Company classifies assets as held for sale if it commits to a plan to sell the asset within one year and actively markets the asset in its current condition for a price that is reasonable in comparison to its estimated fair value. |
Insurance Liabilities | Insurance Liabilities The Company is self‑insured for certain losses related to medical claims. The Company has stop-loss coverage to limit the exposure arising from medical claims. The Company has deductible‑based insurance policies for certain losses related to general liability, workers’ compensation and automobile. The deductible amount per incident is $0.3 million, $0.5 million and $1.0 million for general liability, workers’ compensation and automobile, respectively. The coverage consists of a primary layer and an excess layer. The primary layer of coverage is from $0.5 million to $2.0 million and the excess layer covers claims from $2.0 million to $100.0 million. The expected ultimate cost for claims incurred as of the balance sheet date is not discounted and is recognized as a liability. Insurance losses for claims filed and claims incurred but not reported are accrued based upon estimates of the aggregate liability for uninsured claims using loss development factors and actuarial assumptions followed in the insurance industry and historical loss development experience. As of April 30, 2018 and 2017, the aggregate liabilities for medical self‑insurance were $4.1 million and $3.4 million, respectively, and are included in other accrued expenses and current liabilities in the Consolidated Balance Sheets. As of April 30, 2018 and 2017, reserves for general liability, workers’ compensation and automobile totaled $14.7 million and $15.9 million, respectively, and are included in other accrued expenses and current liabilities and other liabilities in the Consolidated Balance Sheets. During the year ended April 30, 2016, an insured automobile claim related to prior years, subject to a $0.5 million deductible, was paid by our insurance carrier in the amount of $26.3 million. As of April 30, 2018 and 2017, expected recoveries for medical self‑insurance, general liability, automobile and workers’ compensation totaled $4.8 million and $6.7 million, respectively, and are included in prepaid expenses and other current assets and other assets in the Consolidated Balance Sheets. |
Debt Issuance Costs | Debt Issuance Costs The Company capitalizes debt issuance costs and amortizes them over the term of the related debt. The Company uses the straight‑line method to amortize debt issuance costs for its revolving credit facility and uses the effective interest method to amortize debt issuance costs for its term loan facilities. Amortization of debt issuance costs is recorded in interest expense in the Consolidated Statements of Operations and Comprehensive Income. The Company classifies debt issuance costs for its revolving credit facility as an asset in the Consolidated Balance Sheets and classifies debt issuance costs for its term loan facilities as a reduction of the related debt in the Consolidated Balance Sheets. |
Leases | Leases The Company categorizes leases at their inception as either operating or capital leases depending on certain criteria. Leased property and equipment meeting capital lease criteria are capitalized at the lower of the present value of the related lease payments or the fair value of the leased asset at the inception of the lease. Certain of the Company’s operating lease agreements include scheduled rent escalations or rent holidays over the term of the lease. The Company recognizes rent expense on a straight-line basis over the term of the lease. The difference between rent expense and rent paid is recorded as deferred rent in the Consolidated Balance Sheets. Incentives granted under certain leases are treated as a reduction of the Company’s rent expense on a straight-line basis over the term of the related lease agreement. |
Stock Appreciation Rights, Deferred Compensation and Liabilities to Noncontrolling Interest Holders | Stock Appreciation Rights, Deferred Compensation and Liabilities to Noncontrolling Interest Holders Certain subsidiaries have equity based compensation agreements with the subsidiary’s employees and minority shareholders. These agreements are stock appreciation rights, deferred compensation agreements and liabilities to noncontrolling interest holders. Since these agreements are typically settled in cash or notes, they are accounted for as liability awards and measured at fair value. See Note 11, “Stock Appreciation Rights, Deferred Compensation and Redeemable Noncontrolling Interests,” for additional information with respect to these agreements. |
Derivative Instruments | Derivative Instruments The Company has entered into derivative instruments to manage its exposure to certain financial risks. The Company’s derivative financial instruments are recognized as either assets or liabilities in the Consolidated Balance Sheets and measured at fair value. Derivative instruments that do not qualify as a hedge or are not designated as a hedge are adjusted to estimated fair value in earnings. Derivative instruments that meet hedge criteria are formally designated as hedges. For derivative instruments designated as a cash flow hedge, the Company recognizes the change in fair value, net of taxes, on the effective portion of the derivative to accumulated other comprehensive income (loss) in the Consolidated Balance Sheets, and an amount is reclassified out of accumulated other comprehensive income (loss) into earnings to offset the earnings impact that is attributable to the risk being hedged. For derivative instruments designated as a fair value hedge, the Company recognizes the loss or gain attributable to the risk being hedged in earnings in the period of change with a corresponding offset recorded to the item for which the risk is being hedged. The Company performs the effectiveness testing of its designated hedges on a quarterly basis and the changes in ineffective portions of the derivatives, if any, are recognized immediately in earnings. As of April 30, 2018 and 2017, the Company had an interest rate cap agreement with the objective of minimizing the risks and costs associated with its variable rate debt. This agreement is an interest rate cap on quarterly resetting 3‑month LIBOR, based on a strike rate of 2.0% and payable quarterly. This instrument effectively caps the interest rate at 5.75% on an initial notional amount of $275.0 million of the Company’s variable rate debt obligation under the First Lien Facility, or any replacement facility with similar terms. The interest rate cap expires on October 31, 2018. The Company believes there have been no material changes in the creditworthiness of the counterparty to this cap agreement and believes the risk of nonperformance by such party is minimal. The Company has designated the interest rate cap agreement as a cash flow hedge. This derivative instrument is classified in other assets in the Consolidated Balance Sheets. In April 2018, in connection with the acquisition of WSB Titan (see Note 21, “Subsequent Events”), the Company entered into a foreign currency forward contract to mitigate the foreign currency exchange risk associated with the purchase price that was denominated in Canadian dollars. The foreign currency forward contract effectively fixed the amount the Company paid for the purchase price denominated in Canadian dollars by contracting the Company to pay U.S. dollars and receive Canadian dollars on the notional amount. The notional amount of the foreign currency forward contract was $569.2 million as of April 30, 2018. The foreign currency forward contract was not eligible for hedge accounting. This derivative instrument is classified in other accrued expenses and current liabilities in the Consolidated Balance Sheet. See Note 12, “Fair Value Measurements,” and Note 16, “Accumulated Other Comprehensive (Loss) Income,” for additional information with respect to the Company’s derivative instruments. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue at the point of sale or upon delivery to the customer’s site when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the price to the buyer is fixed or determinable and collectability is reasonably assured. Revenue, net of estimated returns and allowances, is recognized when sales transactions occur and title is passed and the related product is delivered. Revenue includes any applicable shipping and handling costs invoiced to the customer. The expense related to such costs is included in selling, general and administrative expenses in the Consolidated Statements of Operations and Comprehensive Income. |
Cost of Sales | Cost of Sales Cost of sales reflects the direct cost of goods purchased from third parties, rebates earned from vendors, adjustments for inventory reserves and the cost of inbound freight. |
Vendor Rebates | Vendor Rebates Typical arrangements with our vendors provide for us to receive a rebate of a specified amount after we achieve any of a number of measures generally related to the volume of our purchases over a period of time. We record these rebates to effectively reduce our cost of sales in the period in which we sell the product. Throughout the year, we estimate the amount of rebates receivable for the periodic programs based upon the expected level of purchases. We accrue for the receipt of vendor rebates based on purchases and also reduce inventory to reflect the deferral of cost of sales. |
Selling, General, and Administrative Expenses | Selling, General and Administrative Expenses Selling, general and administrative expenses include expenses related to the delivery and warehousing of our products, as well as employee compensation and benefits expenses for employees in our branches and yard support center, as well as other administrative expenses, such as legal, accounting and IT costs. Selling, general and administrative expenses included delivery expenses of $228.0 million, $205.0 million and $159.1 million during the years ended April 30, 2018, 2017 and 2016, respectively. |
Advertising Expense | Advertising Expense The cost of advertising is expensed as incurred and included in selling, general and administrative expenses in the Consolidated Statements of Operations and Comprehensive Income. Advertising expense was $1.8 million, $2.3 million and $2.0 million during the years ended April 30, 2018, 2017 and 2016, respectively. |
Equity Based Compensation | Equity‑Based Compensation As of April 30, 2018, the Company had various stock-based compensation plans, which are more fully described in Note 10, “Equity-Based Compensation.” The Company measures compensation cost for all share‑based awards at fair value on the grant date (or measurement date if different) and recognizes compensation expense, net of estimated forfeitures, over the requisite service period for awards expected to vest. The Company estimates the fair value of stock options using the Black-Scholes valuation model and determines the fair value of restricted stock units based on the quoted price of GMS’s common stock on the date of grant . The Company estimates forfeitures based on historical analysis of actual forfeitures and employee turnover. Actual forfeitures are recorded when incurred and estimated forfeitures are reviewed at least annually. |
Income Taxes | Income Taxes Income taxes are accounted for using the asset and liability method. Deferred tax assets and liabilities are recognized based on the difference between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Inherent in the measurement of deferred balances are certain judgments and interpretations of existing tax law and published guidance as applicable to our operations. We evaluate our deferred tax assets to determine if valuation allowances are required. In assessing the realizability of deferred tax assets, we consider both positive and negative evidence in determining whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The primary negative evidence considered includes the cumulative operating losses generated in prior periods. The primary positive evidence considered includes the reversal of deferred tax liabilities related to depreciation and amortization that would occur within the same jurisdiction and during the carry‑forward period necessary to absorb the federal and state net operating losses and other deferred tax assets. The reversal of such liabilities would utilize the federal and state net operating losses and other deferred tax assets. We record amounts for uncertain tax positions that management believes are supportable, but are potentially subject to successful challenge by the applicable taxing authority. Consequently, changes in our assumptions and judgments could materially affect amounts recognized related to income tax uncertainties and may affect our results of operations or financial position. We believe our assumptions for estimates are reasonable, although actual results may have a positive or negative material impact on the balances of such tax positions. Historically, the variation of estimates to actual results is not significant and material variation is not expected in the future. |
Credit and Economic Risk | Credit and Economic Risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash and cash equivalents and trade accounts and notes receivable. The Company assesses the credit standing of counterparties as considered necessary. The Company routinely assesses the financial strength of its customers and generally does not require collateral. Concentrations of credit risk with respect to trade accounts receivable are limited due to the large number of geographically diverse customers comprising the Company’s customer base. Additionally, the Company maintains allowances for potential credit losses. The Company does not enter into financial instruments for trading or speculative purposes. As of April 30, 2018 and 2017, no customer accounted for more than 10% of gross accounts receivable. The Company purchases a majority of its inventories from a select group of vendors. Without these vendors, the Company’s ability to acquire inventory would be significantly impaired. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Authoritative guidance for fair value measurements establishes a three‑level hierarchy that prioritizes the inputs to valuation models based upon the degree to which they are observable. The three levels of the fair value measurement hierarchy are as follows: Level 1 Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity can access at the measurement date. Level 2 Inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3 Inputs are unobservable inputs for which little or no market data exists, therefore requiring an entity to develop its own assumptions. The carrying values of the Company’s cash, cash equivalents, trade receivables and trade payables approximate their fair values because of their nature and short‑term nature . Based on borrowing rates available to the Company for loans with similar terms, the carrying values of the Company’s debt instruments approximate fair value. See Note 12, “Fair Value Measurements,” for additional information with respect to the Company’s fair value measurements. |
Earnings Per Share | Earnings Per Share Basic earnings per share is computed by dividing net income by the weighted average number of outstanding shares of common stock for the period. Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common stock, including stock options and restricted stock units (collectively “Common Stock Equivalents”), were exercised or converted into common stock . The dilutive effect of outstanding stock options and restricted stock units is reflected in diluted earnings per share by application of the treasury stock method. In applying the treasury stock method for stock-based compensation arrangements, the assumed proceeds are computed as the sum of the amount the employee must pay upon exercise and the amount of compensation cost attributed to future services and not yet recognized. Diluted earnings per share is computed by increasing the weighted‑average number of outstanding shares of common stock computed in basic earnings per share to include the dilutive effect of Common Stock Equivalents for the period. In periods of net loss, the number of shares used to calculate diluted loss per share is the same as basic net loss per share. |
Recent Accounting Pronouncements | Recently Adopted Accounting Pronouncements Inventory —In July 2015, the Financial Accounting Standards Board (the “FASB”) issued authoritative guidance on accounting for inventory. The new guidance requires that inventory be measured at the lower of cost and net realizable value. The new guidance is limited to inventory measured using the first-in, first-out (“FIFO”) or average cost methods and excludes inventory measured using last-in, first-out (“LIFO”) or retail inventory methods. The new standard is effective for fiscal years, and interim periods, beginning after December 15, 2016. The Company adopted this guidance on May 1, 2017 (the first day of fiscal 2018) with no Stock Compensation —In March 2016, the FASB issued authoritative guidance that simplifies many key aspects of the accounting for and cash flow presentation of employee share-based compensation transactions, including accounting for income taxes, forfeitures and statutory withholding requirements. The Company adopted this guidance on May 1, 2017 (the first day of fiscal 2018) on a prospective basis. Effective May 1, 2017, the Company now records all excess tax benefits or tax deficiencies as a component of its provision for income taxes in the statement of operations. The Company recorded excess tax benefits of $1.3 million during the year ended April 30, 2018. Additionally, the Company now presents excess tax benefits or deficiencies as operating cash flows versus reclassifying the amount out of operating cash flows and presenting it in financing activities in the Consolidated Statement of Cash Flows. Additional amendments from this guidance related to forfeitures and minimum statutory withholding tax requirements had no impact to our financial position, results of operations or cash flows. As permitted, we continue to estimate forfeitures to determine the amount of compensation cost to be recognized each period rather than electing to account for forfeitures as they occur, and we continue to present the value of shares withheld for minimum statutory tax withholding requirements on the statements of cash flows as a financing activity. Another impact of the adoption is that the calculation of the effect of dilutive securities now excludes any derived excess tax benefits or deficiencies from assumed future proceeds. Definition of a Business —In January 2017, the FASB authoritative guidance on the definition of a business. The new guidance clarifies the definition of a business to help companies evaluate whether acquisition or disposal transactions should be accounted for as assets groups or as businesses. The Company adopted this guidance on May 1, 2017 (the first day of fiscal 2018) on a prospective basis with no material impact to the Company’s financial position, results of operations or cash flows. Recently Issued Accounting Pronouncements Revenue recognition — In May 2014, the FASB issued authoritative guidance on revenue from contracts with customers. The new guidance supersedes most existing revenue recognition guidance and outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. The core principle of the revenue model is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new standard also requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers . In August 2015, the FASB issued guidance that deferred the effective date by one year. The standard is now required to be adopted by public business entities in annual periods beginning on or after December 15, 2017, and interim periods within those annual periods, and may be applied on a full retrospective or modified retrospective approach. Early adoption at the original effective date is permitted. The Company adopted this guidance on May 1, 2018 (the first day of fiscal 2019) using the modified retrospective approach. The Company completed its assessment of the new revenue recognition guidance and concluded that the adoption of this standard did not have a material impact on its financial statements. The adoption of the new guidance will result in additional disclosures regarding the Company’s revenue recognition beginning with the Company’s Quarterly Report on Form 10-Q for the quarterly period ended July 31, 2018. The adoption of the new guidance will also result in a balance sheet reclassification for recording our estimate for customer returns. Leases —In February 2016, the FASB issued authoritative guidance on accounting for leases. The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with such classification affecting the pattern of expense recognition in the statement of operations. The new standard is effective for the Company’s fiscal year beginning May 1, 2019 (the first day of fiscal 2020), including interim reporting periods within that fiscal year. A modified transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. While the Company is still evaluating the impact of its pending adoption of the new standard on its financial statements, the Company expects that upon adoption it will recognize material ROU assets and liabilities. Statement of Cash Flows – In August 2016, the FASB issued new guidance to reduce diversity in practice related to certain cash receipts and payment in the statement of cash flows by adding or clarifying guidance on eight specific cash flow issues. The new guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017 . Early adoption is permitted. The Company adopted this guidance on May 1, 2018 (the first day of fiscal 2019) with no material impact on its financial statements. Income Taxes – In October 2016, the FASB issued new guidance intended to improve the accounting for intra-entity transfers of assets other than inventory by requiring recognition of income tax consequences of intra-entity transfers of assets other than inventory when the transfer occurs. The new guidance is effective for annual and interim periods beginning after December 15, 2017. Early adoption is permitted. The amendments in this update should be applied on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption. The Company adopted this guidance on May 1, 2018 (the first day of fiscal 2019) with no material impact on its financial statements. Goodwill – In January 2017, the FASB issued authoritative guidance that simplifies the accounting for goodwill impairments by eliminating Step 2 from the goodwill impairment test . Under the new guidance, goodwill impairment will be the amount by which a reporting unit’s carrying value exceeds its fair value. The new standard is effective for annual and any interim impairment tests for periods beginning after December 15, 2019. Early adoption is permitted. The Company does not expect the adoption of this standard to have a material impact on its financial statements. Accumulated Other Comprehensive Income – I n February 2018, the FASB issued authoritative guidance which permits entities to reclassify, to retained earnings, the one-time income tax effects stranded in accumulated other comprehensive income arising from the change in the U.S. federal corporate tax rate as a result of the Tax Cuts and Jobs Act of 2017. An entity that elects to make this reclassification must consider all items in accumulated other comprehensive income that have tax effects stranded as a result of the tax rate change, and must disclose the reclassification of these tax effects as well as the entity’s policy for releasing income tax effects from accumulated other comprehensive income. The new guidance may be applied either retrospectively or as of the beginning of the period of adoption. The new guidance is effective for annual and interim periods beginning after December 15, 2018. Early adoption is permitted. The Company plans to adopt this guidance on May 1, 2019 (the first day of fiscal 2020). While this guidance will have no impact on the Company’s results of operations, the Company is currently assessing this standard’s impact on its consolidated financial position. |
Business, Basis of Presentati29
Business, Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Apr. 30, 2018 | |
Business, Basis of Presentation and Summary of Significant Accounting Policies | |
Schedule of estimated useful lives of property and equipment | Buildings 25 - 39 years Furniture, fixtures and automobiles 3 - 5 years Warehouse and delivery equipment 4 - 10 years Leasehold improvements Shorter of estimated useful life or lease term |
Business Acquisitions (Tables)
Business Acquisitions (Tables) | 12 Months Ended |
Apr. 30, 2018 | |
2018 Acquisitions | |
Business Acquisitions | |
Schedule of acquisitions completed | Company Name Form of Acquisition Date of Acquisition ASI Building Products, LLC Purchase of net assets August 1, 2017 Washington Builders Supply, Inc. Purchase of net assets October 2, 2017 Southwest Building Materials, Ltd. Purchase of net assets December 4, 2017 California-based distribution business of Grabber Construction Products, Inc. Purchase of net assets April 2, 2018 CMH Distributing, Inc. Purchase of net assets April 2, 2018 |
Schedule of allocation of consideration for acquisitions | Preliminary Purchase Price Allocation (in thousands) Trade accounts and notes receivable $ 4,872 Inventories 4,321 Property and equipment 1,081 Tradenames 1,000 Vendor agreement 1,000 Other intangible assets 620 Customer relationships 9,358 Goodwill 4,145 Liabilities assumed (1,951) Purchase price $ 24,446 |
2017 Acquisitions | |
Business Acquisitions | |
Schedule of acquisitions completed | Company Name Form of Acquisition Date of Acquisition Wall & Ceiling Supply Co., Inc. Purchase of net assets May 2, 2016 Rockwise, LLC Purchase of net assets July 5, 2016 Steven F. Kempf Building Materials, Inc. Purchase of net assets August 29, 2016 Olympia Building Supplies, LLC/Redmill, Inc. Purchase of 100% of outstanding common stock September 1, 2016 United Building Materials, Inc. Purchase of net assets October 3, 2016 Ryan Building Materials, Inc. Purchase of net assets October 31, 2016 Interior Products Supply Purchase of net assets December 5, 2016 Hawaii-based distribution business of Grabber Construction Products, Inc. Purchase of net assets February 1, 2017 |
Schedule of allocation of consideration for acquisitions | Preliminary Final Purchase Price Adjustments/ Purchase Price Allocation Reclassifications Allocation (in thousands) Cash and cash equivalents $ 1,558 $ — $ 1,558 Trade accounts and notes receivable 37,691 (63) 37,628 Inventories 16,504 — 16,504 Other current assets 657 14 671 Property and equipment 8,357 — 8,357 Tradenames 9,490 — 9,490 Customer relationships 64,660 — 64,660 Goodwill 37,728 (144) 37,584 Deferred tax liability (6,011) — (6,011) Liabilities assumed (16,958) 560 (16,398) Purchase price $ 153,676 $ 367 $ 154,043 |
2016 Acquisitions | |
Business Acquisitions | |
Schedule of acquisitions completed | Company Name Form of Acquisition Date of Acquisition Tri-Cities Drywall & Supply Co. Purchase of net assets September 29, 2015 Badgerland Supply, Inc. Purchase of net assets November 2, 2015 Hathaway & Sons, Inc. Purchase of net assets November 9, 2015 Gypsum Supply Company Purchase of 100% of outstanding common stock January 1, 2016 Robert N. Karpp Co., Inc. Purchase of net assets February 1, 2016 Professional Handling & Distribution, Inc. Purchase of net assets February 1, 2016 M.R. Lee Building Materials, Inc. Purchase of net assets April 4, 2016 |
Schedule of allocation of consideration for acquisitions | Final Purchase Price Allocation (in thousands) Cash and cash equivalents $ 953 Trade accounts and notes receivable 26,988 Inventories 17,703 Property and equipment 9,236 Other assets 808 Tradenames 12,500 Below market leases 2,020 Customer relationships 29,055 Goodwill 38,399 Deferred tax liability (6,676) Liabilities assumed (13,805) Purchase price $ 117,181 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Apr. 30, 2018 | |
Property and Equipment | |
Schedule of components of property and equipment | April 30, 2018 2017 (in thousands) Land $ 50,795 $ 50,009 Buildings and leasehold improvements 87,837 81,872 Machinery and equipment 108,444 90,303 Construction in progress 2,267 3,690 Total property and equipment 249,343 225,874 Less: accumulated depreciation and amortization 85,761 71,409 Total property and equipment, net of accumulated depreciation $ 163,582 $ 154,465 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Apr. 30, 2018 | |
Goodwill and Intangible Assets | |
Schedule of changes in the carrying amount of goodwill | Carrying Amount (in thousands) Balance as of April 30, 2016 $ 386,306 Goodwill acquired 37,728 Purchase price adjustments (390) Balance as of April 30, 2017 423,644 Goodwill acquired 4,145 Purchase price adjustments (144) Balance as of April 30, 2018 $ 427,645 |
Schedule of components of definite-lived intangible assets | The following tables present the components of the Company’s definite-lived intangible assets as of April 30, 2018 and 2017: Estimated Weighted April 30, 2018 Useful Average Gross Net Lives Amortization Carrying Accumulated Carrying (years) Period Amount Amortization Value (dollars in thousands) Customer relationships 5 - 13 10.9 $ 282,547 $ 150,081 $ 132,466 Definite-lived tradenames 5 - 20 18.0 26,250 3,578 22,672 Vendor agreements 8 - 10 8.3 6,644 2,956 3,688 Leasehold interests 7 - 15 9.0 2,866 832 2,034 Other 5 5.0 521 66 455 Totals $ 318,828 $ 157,513 $ 161,315 Estimated Weighted April 30, 2017 Useful Average Gross Net Lives Amortization Carrying Accumulated Carrying (years) Period Amount Amortization Value (dollars in thousands) Customer relationships 5 - 13 10.9 $ 273,196 $ 111,291 $ 161,905 Definite-lived tradenames 5 - 20 18.3 25,250 1,718 23,532 Vendor agreement 8 8.0 5,644 2,176 3,468 Leasehold interests 7 - 13 8.2 2,516 496 2,020 Totals $ 306,606 $ 115,681 $ 190,925 |
Other Accrued Expenses and Cu33
Other Accrued Expenses and Current Liabilities (Tables) | 12 Months Ended |
Apr. 30, 2018 | |
Other Accrued Expenses and Current Liabilities | |
Schedule of components of other accrued expenses and current liabilities | April 30, 2018 2017 (in thousands) Insurance related liabilities $ 11,432 $ 11,027 Sales taxes payable 9,864 8,920 Derivative liability 5,108 — Accrued rebates 3,640 3,041 Contingent consideration 1,917 5,708 Real estate and personal property taxes 1,823 1,686 Deferred revenue 1,402 573 Other 9,960 6,936 Total other accrued expenses and current liabilities $ 45,146 $ 37,891 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
Apr. 30, 2018 | |
Long-Term Debt | |
Schedule of long-term debt | April 30, April 30, 2018 2017 (in thousands) First Lien Term Loan due 2023 (1) (2) $ 563,179 $ 470,245 ABL Facility — 103,353 Capital lease obligations, at an annual rate of 5.50%, due in monthly installments through 2023 18,564 15,611 Installment notes at fixed rates up to 5.0%, due in monthly and annual installments through 2023 (3) 14,143 5,711 Carrying value of debt 595,886 594,920 Less current portion 16,284 11,530 Long-term debt $ 579,602 $ 583,390 (1) Net of unamortized discount of $2,536 and $1,658 as of April 30, 2018 and 2017, respectively. (2) Net of deferred financing costs of $6,125 and $5,712 as of April 30, 2018 and 2017, respectively. (3) Net of unamortized discount of $1,534 and $751 as of April 30, 2018 and 2017, respectively. |
Scheduled principal payments of long-term debt | Debt Maturities As of April 30, 2018, the maturities of long‑term debt were as follows: First Lien Installment Capital Term Loan(1) Notes(2) Leases Total Years ending April 30, (in thousands) 2019 $ 5,776 $ 4,048 $ 6,460 $ 16,284 2020 5,776 3,292 5,157 14,225 2021 5,776 2,989 3,574 12,339 2022 5,776 2,553 1,747 10,076 2023 548,736 2,521 1,070 552,327 Thereafter — 274 556 830 $ 571,840 $ 15,677 $ 18,564 $ 606,081 (1) (2) |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Apr. 30, 2018 | |
Income Taxes | |
Schedule of components of income tax expense (benefit) | Year Ended April 30, 2018 2017 2016 (in thousands) Current federal $ 30,827 $ 37,164 $ 28,043 Current state 6,409 5,875 5,162 Total current 37,236 43,039 33,205 Deferred federal (14,796) (19,011) (19,993) Deferred state (1,557) (1,374) (628) Total deferred (16,353) (20,385) (20,621) Total provision for income taxes $ 20,883 $ 22,654 $ 12,584 |
Schedule of effective tax rate for financial statement | Year Ended April 30, 2018 2017 2016 (in thousands) Federal income taxes at statutory rate $ 25,492 $ 25,039 $ 8,802 State income taxes, net of federal income tax benefit 1,900 2,236 2,336 Net change in valuation allowance 151 214 (60) Nondeductible meals & entertainment 822 761 627 338(h)(10) election — (6,936) — Redeemable noncontrolling interests — 1,053 291 Nondeductible transaction costs 2 109 253 Net Deferred Benefit due to Tax Cuts and Jobs Act (6,763) — — Other (721) 178 335 Total provision for income taxes $ 20,883 $ 22,654 $ 12,584 |
Schedule of tax effects of temporary differences which give rise to deferred income taxes | April 30, 2018 2017 Deferred income tax assets: (in thousands) Allowances on accounts and notes receivable $ 3,540 $ 5,792 Accrued payroll and related costs 1,138 1,651 Insurance reserves 1,734 1,139 Inventory costs 2,013 2,430 Deferred compensation 6,662 9,293 Equity compensation 2,361 3,424 Derivative instrument 561 1,488 Acquisition related costs 1,955 1,732 Net operating loss carry-forwards 1,965 2,949 Deferred rent 488 996 Noncompete agreements 681 819 Other deferred tax assets, net 946 2,576 Total deferred income tax assets 24,044 34,289 Less: Valuation allowance (448) (297) Total deferred income tax assets, net of valuation allowance 23,596 33,992 Deferred income tax liabilities: Amortization of intangible assets (28,641) (53,345) Rebates (253) (1,007) Depreciation (3,596) (3,808) Deferred financing costs (1,848) (2,652) Total deferred income tax liabilities (34,338) (60,812) Deferred income tax liabilities, net $ (10,742) $ (26,820) |
Equity-Based Compensation - (Ta
Equity-Based Compensation - (Tables) | 12 Months Ended |
Apr. 30, 2018 | |
Equity-Based Compensation | |
Summary of stock option activity | Weighted Weighted Average Average Remaining Aggregate Number of Exercise Contractual Intrinsic Options Price Life (years) Value (shares and dollars in thousands) Outstanding as of April 30, 2017 2,088 $ 13.49 7.23 $ 47,336 Options granted 63 37.49 Options exercised (199) 12.53 Options forfeited — — Options expired — — Outstanding as of April 30, 2018 1,952 $ 14.37 6.52 $ 33,209 Exercisable as of April 30, 2018 1,682 $ 12.97 6.31 $ 30,599 Vested and expected to vest as of April 30, 2018 1,946 $ 14.33 6.52 $ 33,173 |
Schedule of weighted average assumptions used in Black-Scholes option-pricing model | Year Ended April 30, 2018 2017 Volatility 30.86 % 40.68 % Expected life (years) Risk-free interest rate 2.18 % 1.55 % Dividend yield — % — % |
Stock Appreciation Rights, De37
Stock Appreciation Rights, Deferred Compensation and Redeemable Noncontrolling Interests (Tables) | 12 Months Ended |
Apr. 30, 2018 | |
Stock Appreciation Rights, Deferred Compensation and Redeemable Noncontrolling Interests | |
Summary of changes to liability for equity based compensation arrangements | Stock Appreciation Deferred Noncontrolling Rights Compensation Interests (in thousands) Balance as of April 30, 2016 $ 20,533 $ 3,270 $ 26,585 Redemption notes (28) — (5,354) Change in fair value 157 480 3,078 Balance as of April 30, 2017 20,662 3,750 24,309 Amounts redeemed (1,036) (1,733) (9,664) Change in fair value 2,318 205 1,525 Balance as of April 30, 2018 $ 21,944 $ 2,222 $ 16,170 Classified as current as of April 30, 2017 $ 878 $ 300 $ 1,733 Classified as long-term as of April 30, 2017 19,784 3,450 22,576 Classified as current as of April 30, 2018 308 133 463 Classified as long-term as of April 30, 2018 21,636 2,089 15,707 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Apr. 30, 2018 | |
Fair Value Measurements | |
Schedule of assets and liabilities measured at fair value on a recurring basis | April 30, April 30, 2018 2017 (in thousands) Assets: Interest rate cap (Level 2) $ 543 $ 88 Liabilities: Forward currency forward (Level 2) $ 5,108 $ — Stock appreciation rights (Level 3) 21,944 20,662 Deferred Compensation (Level 3) 2,222 3,750 Noncontrolling interest holders (Level 3) 16,170 24,309 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Apr. 30, 2018 | |
Commitments and Contingencies | |
Schedule of annual future minimum lease payments under noncancelable operating leases and future maturities of capital lease obligations | As of April 30, 2018, the approximate amounts of the annual future minimum lease payments under noncancelable operating leases, including amounts payable to affiliated partnerships, and future maturities of capital lease obligations are as follows (in thousands): Capital Operating Year Ended April 30, 2019 $ 7,289 $ 59,529 2020 5,665 52,815 2021 3,882 43,120 2022 1,937 29,299 2023 1,147 17,820 Thereafter 571 13,601 $ 20,491 $ 216,184 Less: Interest 1,927 Capitalized lease obligations $ 18,564 |
Segments (Tables)
Segments (Tables) | 12 Months Ended |
Apr. 30, 2018 | |
Segments | |
Schedule of segment results | Year Ended April 30, 2018 April 30, 2018 Depreciation and Adjusted Total Net Sales Gross Profit Amortization EBITDA Assets (in thousands) Geographic divisions $ 2,487,557 $ 809,884 $ 64,491 $ 196,903 $ 1,434,371 Other 23,912 8,692 242 2,355 12,854 Corporate — — 797 — 7,286 $ 2,511,469 $ 818,576 $ 65,530 $ 199,258 $ 1,454,511 Year Ended April 30, 2017 April 30, 2017 Depreciation and Adjusted Total Net Sales Gross Profit Amortization EBITDA Assets (in thousands) Geographic divisions $ 2,298,871 $ 750,564 $ 68,001 $ 186,155 $ 1,376,655 Other 20,275 8,007 310 2,074 11,916 Corporate — — 929 — 4,694 $ 2,319,146 $ 758,571 $ 69,240 $ 188,229 $ 1,393,265 Year Ended April 30, 2016 April 30, 2016 Depreciation and Adjusted Total Net Sales Gross Profit Amortization EBITDA Assets (in thousands) Geographic divisions $ 1,842,634 $ 587,213 $ 63,093 $ 137,459 $ 1,217,871 Other 15,548 5,951 295 724 12,310 Corporate — — 827 — 10,633 $ 1,858,182 $ 593,164 $ 64,215 $ 138,183 $ 1,240,814 |
Reconciliation of Adjusted EBITDA to net income | Year Ended April 30, 2018 2017 2016 (in thousands) Net income $ 62,971 $ 48,886 $ 12,564 Interest expense 31,395 29,360 37,418 Write-off of debt discount and deferred financing fees 74 7,103 — Interest income (177) (152) (928) Income tax expense 20,883 22,654 12,584 Depreciation expense 24,075 25,565 26,667 Amortization expense 41,455 43,675 37,548 Stock appreciation expense(a) 2,318 148 1,988 Redeemable noncontrolling interests(b) 1,868 3,536 880 Equity-based compensation(c) 1,695 2,534 2,699 Severance and other permitted costs(d) 581 (157) 379 Transaction costs (acquisitions and other)(e) 3,370 2,249 3,751 Gain on sale of assets (509) (338) (645) Management fee to related party(f) — 188 2,250 Effects of fair value adjustments to inventory(g) 324 946 1,009 Change in fair value of financial instruments(h) 6,125 382 19 Secondary public offering costs(i) 1,525 1,385 — Debt transaction costs(j) 1,285 265 — Adjusted EBITDA $ 199,258 $ 188,229 $ 138,183 (a) Represents non‑cash expense related to stock appreciation rights agreements. (b) Represents non‑cash compensation expense related to changes in the redemption values of noncontrolling interests. (c) Represents non‑cash equity‑based compensation expense related to the issuance of share-based awards. (d) Represents severance expenses and other costs permitted in calculations under the ABL Facility and the First Lien Facility. (e) Represents one‑time costs related to our IPO and acquisitions paid to third party advisors. (f) Represents management fees paid by us to AEA. Following our IPO, AEA no longer receives management fees from us. (g) Represents the non‑cash cost of sales impact of purchase accounting adjustments to increase inventory to its estimated fair value. (h) Represents the mark‑to‑market adjustments for derivative financial instruments. (i) Represents one-time costs related to our secondary offering paid to third-party advisors. (j) Represents expenses paid to third party advisors related to debt refinancing activities. |
Schedule of net sales to external customers by main product lines | Year Ended April 30, 2018 2017 2016 (in thousands) Wallboard $ 1,109,552 $ 1,058,400 $ 870,952 Ceilings 387,360 341,007 297,110 Steel framing 411,630 374,151 281,340 Other products 602,927 545,588 408,780 Total net sales $ 2,511,469 $ 2,319,146 $ 1,858,182 |
Accumulated Other Comprehensi41
Accumulated Other Comprehensive (Loss) Income (Tables) | 12 Months Ended |
Apr. 30, 2018 | |
Accumulated Other Comprehensive (Loss) Income | |
Schedule of changes to accumulated other comprehensive (loss) income, net of tax by component | Gain (Loss) On Interest Rate Cap (in thousands) Accumulated other comprehensive income as of April 30, 2015 $ 10 Other comprehensive loss before reclassification (1,177) Reclassification to earnings from accumulated other comprehensive (loss) income(1) 19 Accumulated other comprehensive loss as of April 30, 2016 (1,148) Other comprehensive loss before reclassification (118) Reclassification to earnings from accumulated other comprehensive (loss) income(1) 382 Accumulated other comprehensive loss as of April 30, 2017 (884) Other comprehensive gain before reclassification 309 Reclassification to earnings from accumulated other comprehensive (loss) income(1) 1,016 Accumulated other comprehensive income as of April 30, 2018 $ 441 (1) Amounts are recorded as a component of change in other comprehensive income in the Consolidated Statements of Operations. |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 12 Months Ended |
Apr. 30, 2018 | |
Earnings Per Common Share | |
Schedule of computation of basic and diluted earnings per share of common stock | Year Ended April 30, 2018 2017 2016 (in thousands, except per share data) Net income $ 62,971 $ 48,886 $ 12,564 Basic earnings per common share: Basic weighted average common shares outstanding 41,015 40,260 32,799 Basic earnings per common share $ 1.54 $ 1.21 $ 0.38 Diluted earnings per common share: Basic weighted average common shares outstanding 41,015 40,260 32,799 Add: Common Stock Equivalents 1,148 810 326 Diluted weighted average common shares outstanding 42,163 41,070 33,125 Diluted earnings per common share $ 1.49 $ 1.19 $ 0.38 |
Condensed Parent Company Fina43
Condensed Parent Company Financial Information (Tables) | 12 Months Ended |
Apr. 30, 2018 | |
Condensed Parent Company Financial Information | |
Condensed Parent Company Balance Sheets | April 30, 2018 2017 (in thousands) Investment in subsidiary $ 579,451 $ 514,606 Total assets 579,451 514,606 Stockholders’ equity: Common stock, $0.01 par value, authorized 500,000 shares; 41,069 and 40,971 shares issued and outstanding as of April 30, 2018 and 2017, respectively 411 410 Additional paid-in capital 489,007 488,459 Accumulated deficit 89,592 26,621 Accumulated other comprehensive income 441 (884) Total stockholders’ equity $ 579,451 $ 514,606 |
Condensed Parent Company Statements of Operations and Comprehensive Income | Year Ended April 30, 2018 2017 2016 (in thousands) Net income in subsidiaries $ 62,971 $ 48,886 $ 12,564 Net income 62,971 48,886 12,564 Comprehensive income 64,296 49,150 11,406 Weighted average shares outstanding: Basic 41,015 40,260 32,799 Diluted 42,163 41,070 33,125 Net income per share Basic $ 1.54 $ 1.21 $ 0.38 Diluted $ 1.49 $ 1.19 $ 0.38 |
Valuation and Qualifying Acco44
Valuation and Qualifying Accounts (Tables) | 12 Months Ended |
Apr. 30, 2018 | |
Allowance for Doubtful Accounts | |
Valuation and Qualifying Accounts | |
Schedule of Valuation and Qualifying Accounts | Balance Charged to Balance at Beginning Other at End of of Period Provision Accounts(a) Deductions Period (in thousands) Fiscal Year Ended April 30, 2018 $ (9,851) $ (366) $ (596) $ 1,180 $ (9,633) Fiscal Year Ended April 30, 2017 (8,607) (1,792) (819) 1,367 (9,851) Fiscal Year Ended April 30, 2016 (8,633) (908) 77 857 (8,607) (a) Charged to other accounts represents the net (increase) decrease for specifically reserved accounts, as well as the net change in reserves for sales discounts, service charges and sales returns. |
Valuation Allowance on Deferred Tax Assets | |
Valuation and Qualifying Accounts | |
Schedule of Valuation and Qualifying Accounts | Balance Additions Balance at Beginning Charged to Costs at End of of Period and Expenses Deductions Period (in thousands) Fiscal Year Ended April 30, 2018 $ (297) $ (151) $ — $ (448) Fiscal Year Ended April 30, 2017 (83) (255) 41 (297) Fiscal Year Ended April 30, 2016 (143) (38) 98 (83) |
Selected Quarterly Financial 45
Selected Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Apr. 30, 2018 | |
Selected Quarterly Financial Data (Unaudited) | |
Schedule of selected quarterly financial information | Year Ended April 30, 2018 First Second Third Fourth Quarter Quarter Quarter Quarter (in thousands, except per share data) Net sales $ 642,157 $ 648,004 $ 585,508 $ 635,800 Gross profit 205,104 212,260 195,420 205,792 Net income(1) 15,343 18,023 19,686 9,919 Per share data Weighted average shares outstanding(2): Basic 40,971 41,006 41,036 41,048 Diluted 42,128 42,146 42,228 42,151 Net income per share(2): Basic $ 0.37 $ 0.44 $ 0.48 $ 0.24 Diluted $ 0.36 $ 0.43 $ 0.47 $ 0.24 Year Ended April 30, 2017 First Second Third Fourth Quarter Quarter Quarter Quarter (in thousands, except per share data) Net sales $ 549,800 $ 591,846 $ 562,523 $ 614,977 Gross profit 178,585 193,224 185,727 201,035 Net income 9,163 17,224 8,226 14,273 Per share data Weighted average shares outstanding(2): Basic 38,201 40,943 40,943 40,956 Diluted 38,602 41,320 41,578 41,759 Net income per share(2): Basic $ 0.24 $ 0.42 $ 0.20 $ 0.35 Diluted $ 0.24 $ 0.42 $ 0.20 $ 0.33 (1) Net income for the third quarter of 2018 includes a $7.8 million provisional income tax benefit for the re-measurement of deferred tax assets and liabilities in connection with the Tax Act. Net income for the fourth quarter of 2018 includes a $5.1 million loss on change in fair value of financial instruments related to the Company’s foreign currency forward contract and a $1.1 million decrease to the provisional income tax benefit recorded during the third quarter of 2018. Basic and diluted net income per share are computed independently for each of the quarters presented. Therefore, the sum of the quarterly basic and diluted net income per share amounts may not equal annual basic and diluted net income per share amounts. |
Business, Basis of Presentati46
Business, Basis of Presentation and Summary of Significant Accounting Policies - Business (Details) | Apr. 30, 2018statelocation |
Business | |
Number of states in which products are distributed | state | 42 |
Minimum | |
Business | |
Number of branches through which products are distributed | location | 214 |
Business, Basis of Presentati47
Business, Basis of Presentation and Summary of Significant Accounting Policies - Initial and Secondary Public Offerings (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | Dec. 14, 2017 | Jun. 07, 2017 | Feb. 28, 2017 | Jun. 01, 2016 | Apr. 30, 2017 |
Initial and Secondary Public Offerings | |||||
Net proceeds from initial public offering | $ 156,900 | $ 156,941 | |||
Second Lien Term Loan | |||||
Initial and Secondary Public Offerings | |||||
Loan repayment | $ 160,000 | $ 160,000 | |||
Initial public offering | Common Stock | |||||
Initial and Secondary Public Offerings | |||||
Number of shares issued | 8,100 | 8,050 | |||
Offering price (in dollars per share) | $ 21 | ||||
Underwriters over-allotment option | Common Stock | |||||
Initial and Secondary Public Offerings | |||||
Number of shares issued | 1,100 | ||||
Selling stockholders | |||||
Initial and Secondary Public Offerings | |||||
Shares sold | 5,000 | ||||
Price to the public (in dollars per share) | $ 38.25 | ||||
Selling stockholders | Secondary offering | |||||
Initial and Secondary Public Offerings | |||||
Shares sold | 5,800 | 8,000 | |||
Price to the public (in dollars per share) | $ 33 | $ 29.25 | |||
Selling stockholders | Underwriters over-allotment option | |||||
Initial and Secondary Public Offerings | |||||
Shares sold | 800 | 1,000 |
Business, Basis of Presentati48
Business, Basis of Presentation and Summary of Significant Accounting Policies - Property and Equipment (Details) | 12 Months Ended |
Apr. 30, 2018 | |
Buildings | Minimum | |
Property and equipment | |
Estimated useful life | 25 years |
Buildings | Maximum | |
Property and equipment | |
Estimated useful life | 39 years |
Furniture, fixtures and automobiles | Minimum | |
Property and equipment | |
Estimated useful life | 3 years |
Furniture, fixtures and automobiles | Maximum | |
Property and equipment | |
Estimated useful life | 5 years |
Warehouse and delivery equipment | Minimum | |
Property and equipment | |
Estimated useful life | 4 years |
Warehouse and delivery equipment | Maximum | |
Property and equipment | |
Estimated useful life | 10 years |
Business, Basis of Presentati49
Business, Basis of Presentation and Summary of Significant Accounting Policies - Insurance Liabilities (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Apr. 30, 2016 | Apr. 30, 2018 | Apr. 30, 2017 | |
Other accrued expenses and current liabilities. | |||
Insurance Liabilities | |||
Aggregate liabilities for medical self-insurance | $ 4.1 | $ 3.4 | |
General liability | |||
Insurance Liabilities | |||
Deductible amount | 0.3 | ||
Workers' compensation | |||
Insurance Liabilities | |||
Deductible amount | 0.5 | ||
Automobile | |||
Insurance Liabilities | |||
Deductible amount | 1 | ||
Deductible amount on insured claim | $ 0.5 | ||
Insurance recoveries | $ 26.3 | ||
General liability, workers' compensation and automobile | Other accrued expenses and current liabilities. | |||
Insurance Liabilities | |||
Reserve for insurance | 14.7 | 15.9 | |
General liability, workers' compensation and automobile | Prepaid expenses and other current assets | |||
Insurance Liabilities | |||
Insurance recovery receivable | 4.8 | $ 6.7 | |
General liability, workers' compensation and automobile | Minimum | |||
Insurance Liabilities | |||
Primary layer of insurance coverage | 0.5 | ||
Excess layer of insurance coverage | 2 | ||
General liability, workers' compensation and automobile | Maximum | |||
Insurance Liabilities | |||
Primary layer of insurance coverage | 2 | ||
Excess layer of insurance coverage | $ 100 |
Business, Basis of Presentati50
Business, Basis of Presentation and Summary of Significant Accounting Policies - Derivative Instruments (Details) $ in Millions | Apr. 30, 2018USD ($) |
Interest rate cap | |
Derivative [Line Items] | |
Strike rate (as a percent) | 2.00% |
Capped interest rate (as a percent) | 5.75% |
Forward currency forward | |
Derivative [Line Items] | |
Notional amount | $ 569.2 |
Designated | Interest rate cap | |
Derivative [Line Items] | |
Notional amount | $ 275 |
Business, Basis of Presentati51
Business, Basis of Presentation and Summary of Significant Accounting Policies - Delivery Expenses, Receivable Reserves and Excess Inventory (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Apr. 30, 2018 | Apr. 30, 2017 | Apr. 30, 2016 | |
Selling, general and administrative expenses | |||
Delivery expenses classification | |||
Delivery expenses | $ 228 | $ 205 | $ 159.1 |
Business, Basis of Presentati52
Business, Basis of Presentation and Summary of Significant Accounting Policies - Advertising Expense and Credit and Economic Risk (Details) $ in Millions | 12 Months Ended | ||
Apr. 30, 2018USD ($)customer | Apr. 30, 2017USD ($)customer | Apr. 30, 2016USD ($) | |
Selling, general and administrative expenses | |||
Advertising Expense | |||
Advertising Expense | $ | $ 1.8 | $ 2.3 | $ 2 |
Accounts receivable | |||
Advertising Expense | |||
Number of major customers | customer | 0 | 0 |
Business, Basis of Presentati53
Business, Basis of Presentation and Summary of Significant Accounting Policies - Recent Accounting Pronouncements (Details) $ in Millions | 12 Months Ended |
Apr. 30, 2018USD ($) | |
ASU 2016 09 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Excess tax benefits | $ 1.3 |
Business Acquisitions (Details)
Business Acquisitions (Details) $ in Thousands | 12 Months Ended | ||||
Apr. 30, 2018USD ($)segment | Apr. 30, 2017USD ($) | Apr. 30, 2016USD ($) | Sep. 01, 2016 | Jan. 01, 2016 | |
Business Acquisitions | |||||
Number of reportable segments | segment | 1 | ||||
Preliminary Purchase Price Allocation | |||||
Goodwill | $ 427,645 | $ 423,644 | $ 386,306 | ||
Adjustments/Reclassifications | |||||
Goodwill | (144) | (390) | |||
2018 Acquisitions | |||||
Purchase price | |||||
Aggregate purchase price | 24,400 | ||||
Preliminary Purchase Price Allocation | |||||
Trade accounts and notes receivable | 4,872 | ||||
Inventories | 4,321 | ||||
Property and equipment | 1,081 | ||||
Goodwill | 4,145 | ||||
Liabilities assumed | (1,951) | ||||
Purchase price | 24,446 | ||||
2018 Acquisitions | Tradenames | |||||
Preliminary Purchase Price Allocation | |||||
Definite lived intangible assets | 1,000 | ||||
2018 Acquisitions | Vendor agreement | |||||
Preliminary Purchase Price Allocation | |||||
Definite lived intangible assets | 1,000 | ||||
2018 Acquisitions | Other intangible assets | |||||
Preliminary Purchase Price Allocation | |||||
Definite lived intangible assets | 620 | ||||
2018 Acquisitions | Customer relationships | |||||
Preliminary Purchase Price Allocation | |||||
Definite lived intangible assets | 9,358 | ||||
2017 Acquisitions | |||||
Purchase price | |||||
Aggregate purchase price | 154,000 | ||||
Cash consideration | 148,700 | ||||
Contingent consideration | 5,300 | ||||
Preliminary Purchase Price Allocation | |||||
Cash and cash equivalents | 1,558 | ||||
Trade accounts and notes receivable | 37,628 | ||||
Inventories | 16,504 | ||||
Other current assets | 671 | ||||
Property and equipment | 8,357 | ||||
Goodwill | 37,584 | ||||
Deferred tax liability | (6,011) | ||||
Liabilities assumed | (16,398) | ||||
Purchase price | 154,043 | ||||
Adjustments/Reclassifications | |||||
Trade accounts and notes receivable | (63) | ||||
Other current assets | 14 | ||||
Goodwill | (144) | ||||
Liabilities assumed | 560 | ||||
Purchase price | 367 | ||||
Increase in total consideration paid | 400 | ||||
Goodwill and intangible assets | |||||
Goodwill expected to be deductible for U.S. federal income tax purposes | 25,400 | ||||
Other intangible assets expected to be deductible for U.S. federal income tax purposes | 53,600 | ||||
Goodwill expected to be nondeductible for U.S. federal income tax purposes | 12,200 | ||||
Other intangible assets expected to be nondeductible for U.S. federal income tax purposes | 20,600 | ||||
2017 Acquisitions | Tradenames | |||||
Preliminary Purchase Price Allocation | |||||
Definite lived intangible assets | 9,490 | ||||
2017 Acquisitions | Customer relationships | |||||
Preliminary Purchase Price Allocation | |||||
Definite lived intangible assets | $ 64,660 | ||||
2017 Acquisitions | As previously reported | |||||
Preliminary Purchase Price Allocation | |||||
Cash and cash equivalents | 1,558 | ||||
Trade accounts and notes receivable | 37,691 | ||||
Inventories | 16,504 | ||||
Other current assets | 657 | ||||
Property and equipment | 8,357 | ||||
Goodwill | 37,728 | ||||
Deferred tax liability | (6,011) | ||||
Liabilities assumed | (16,958) | ||||
Purchase price | 153,676 | ||||
2017 Acquisitions | As previously reported | Tradenames | |||||
Preliminary Purchase Price Allocation | |||||
Definite lived intangible assets | 9,490 | ||||
2017 Acquisitions | As previously reported | Customer relationships | |||||
Preliminary Purchase Price Allocation | |||||
Definite lived intangible assets | $ 64,660 | ||||
Olympia Building Supplies, LLC/Redmill, Inc. | |||||
Business Acquisitions | |||||
Outstanding common stock purchased (as a percent) | 100.00% | ||||
2016 Acquisitions | |||||
Purchase price | |||||
Aggregate purchase price | 117,200 | ||||
Cash consideration | 114,800 | ||||
Contingent consideration | 2,400 | ||||
Preliminary Purchase Price Allocation | |||||
Cash and cash equivalents | 953 | ||||
Trade accounts and notes receivable | 26,988 | ||||
Inventories | 17,703 | ||||
Property and equipment | 9,236 | ||||
Other assets | 808 | ||||
Goodwill | 38,399 | ||||
Deferred tax liability | (6,676) | ||||
Liabilities assumed | (13,805) | ||||
Purchase price | 117,181 | ||||
Goodwill and intangible assets | |||||
Goodwill expected to be deductible for U.S. federal income tax purposes | 13,400 | ||||
Other intangible assets expected to be deductible for U.S. federal income tax purposes | 26,300 | ||||
Goodwill expected to be nondeductible for U.S. federal income tax purposes | 25,000 | ||||
Other intangible assets expected to be nondeductible for U.S. federal income tax purposes | 17,200 | ||||
2016 Acquisitions | Tradenames | |||||
Preliminary Purchase Price Allocation | |||||
Definite lived intangible assets | 12,500 | ||||
2016 Acquisitions | Below market leases | |||||
Preliminary Purchase Price Allocation | |||||
Definite lived intangible assets | 2,020 | ||||
2016 Acquisitions | Customer relationships | |||||
Preliminary Purchase Price Allocation | |||||
Definite lived intangible assets | $ 29,055 | ||||
Gypsum Supply Company | |||||
Business Acquisitions | |||||
Outstanding common stock purchased (as a percent) | 100.00% |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Apr. 30, 2018 | Apr. 30, 2017 | Apr. 30, 2016 | |
Property and equipment | |||
Total property and equipment | $ 249,343 | $ 225,874 | |
Less: accumulated depreciation and amortization | 85,761 | 71,409 | |
Property, Plant and Equipment, Net, Total | 163,582 | 154,465 | |
Depreciation and amortization expense for property and equipment | 24,100 | 25,600 | $ 26,700 |
Land | |||
Property and equipment | |||
Total property and equipment | 50,795 | 50,009 | |
Buildings and leasehold improvements | |||
Property and equipment | |||
Total property and equipment | 87,837 | 81,872 | |
Machinery and equipment | |||
Property and equipment | |||
Total property and equipment | 108,444 | 90,303 | |
Construction in progress | |||
Property and equipment | |||
Total property and equipment | $ 2,267 | $ 3,690 |
Goodwill and Intangible Asset56
Goodwill and Intangible Assets - Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Apr. 30, 2018 | Apr. 30, 2017 | |
Carrying Amount of Goodwill | ||
Balance | $ 423,644 | $ 386,306 |
Goodwill acquired | 4,145 | 37,728 |
Purchase price adjustments | (144) | (390) |
Balance | $ 427,645 | $ 423,644 |
Goodwill and Intangible Asset57
Goodwill and Intangible Assets - Definite-Lived Intangible Assets (Details) $ in Thousands | 12 Months Ended | |
Apr. 30, 2018USD ($)segment | Apr. 30, 2017USD ($) | |
Definite-lived intangible assets | ||
Number of operating segments | segment | 6 | |
Gross Carrying Amount | $ 318,828 | $ 306,606 |
Accumulated Amortization | 157,513 | 115,681 |
Net Carrying Value | $ 161,315 | $ 190,925 |
Customer relationships | ||
Definite-lived intangible assets | ||
Weighted Average Amortization Period (in years) | 10 years 10 months 24 days | 10 years 10 months 24 days |
Gross Carrying Amount | $ 282,547 | $ 273,196 |
Accumulated Amortization | 150,081 | 111,291 |
Net Carrying Value | $ 132,466 | $ 161,905 |
Customer relationships | Minimum | ||
Definite-lived intangible assets | ||
Estimated Useful Lives (years) | 5 years | 5 years |
Customer relationships | Maximum | ||
Definite-lived intangible assets | ||
Estimated Useful Lives (years) | 13 years | 13 years |
Tradenames | ||
Definite-lived intangible assets | ||
Weighted Average Amortization Period (in years) | 18 years | 18 years 3 months 18 days |
Gross Carrying Amount | $ 26,250 | $ 25,250 |
Accumulated Amortization | 3,578 | 1,718 |
Net Carrying Value | $ 22,672 | $ 23,532 |
Tradenames | Minimum | ||
Definite-lived intangible assets | ||
Estimated Useful Lives (years) | 5 years | 5 years |
Tradenames | Maximum | ||
Definite-lived intangible assets | ||
Estimated Useful Lives (years) | 20 years | 20 years |
Vendor agreements | ||
Definite-lived intangible assets | ||
Estimated Useful Lives (years) | 8 years | |
Weighted Average Amortization Period (in years) | 8 years 3 months 18 days | 8 years |
Gross Carrying Amount | $ 6,644 | $ 5,644 |
Accumulated Amortization | 2,956 | 2,176 |
Net Carrying Value | $ 3,688 | $ 3,468 |
Vendor agreements | Minimum | ||
Definite-lived intangible assets | ||
Estimated Useful Lives (years) | 8 years | |
Vendor agreements | Maximum | ||
Definite-lived intangible assets | ||
Estimated Useful Lives (years) | 10 years | |
Leasehold interests | ||
Definite-lived intangible assets | ||
Weighted Average Amortization Period (in years) | 9 years | 8 years 2 months 12 days |
Gross Carrying Amount | $ 2,866 | $ 2,516 |
Accumulated Amortization | 832 | 496 |
Net Carrying Value | $ 2,034 | $ 2,020 |
Leasehold interests | Minimum | ||
Definite-lived intangible assets | ||
Estimated Useful Lives (years) | 7 years | 7 years |
Leasehold interests | Maximum | ||
Definite-lived intangible assets | ||
Estimated Useful Lives (years) | 15 years | 13 years |
Other intangible assets | ||
Definite-lived intangible assets | ||
Estimated Useful Lives (years) | 5 years | |
Weighted Average Amortization Period (in years) | 5 years | |
Gross Carrying Amount | $ 521 | |
Accumulated Amortization | 66 | |
Net Carrying Value | $ 455 |
Goodwill and Intangible Asset58
Goodwill and Intangible Assets - Amortization (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Apr. 30, 2018 | Apr. 30, 2017 | Apr. 30, 2016 | |
Intangible assets | |||
Amortization expense | $ 41,455 | $ 43,675 | $ 37,548 |
Depreciation and amortization expense | |||
Intangible assets | |||
Amortization expense | $ 41,500 | $ 43,700 | $ 37,500 |
Goodwill and Intangible Asset59
Goodwill and Intangible Assets - Estimated Aggregate Amortization Expense (Details) $ in Millions | Apr. 30, 2018USD ($) |
Estimated aggregate future amortization expense | |
2,019 | $ 34.8 |
2,020 | 28 |
2,021 | 22.6 |
2,022 | 18.4 |
2,023 | 14.2 |
Thereafter | $ 43.3 |
Goodwill and Intangible Asset60
Goodwill and Intangible Assets - Indefinite-Lived Intangible Assets (Details) - USD ($) $ in Millions | Apr. 30, 2017 | Apr. 30, 2016 |
Goodwill and Intangible Assets | ||
Tradenames | $ 61.4 | $ 61.4 |
Other Accrued Expenses and Cu61
Other Accrued Expenses and Current Liabilities (Details) - USD ($) $ in Thousands | Apr. 30, 2018 | Apr. 30, 2017 |
Other Accrued Expenses and Current Liabilities | ||
Insurance related liabilities | $ 11,432 | $ 11,027 |
Sales taxes payable | 9,864 | 8,920 |
Derivative liability | 5,108 | |
Accrued rebates | 3,640 | 3,041 |
Contingent consideration | 1,917 | 5,708 |
Real estate and personal property taxes | 1,823 | 1,686 |
Deferred revenue | 1,402 | 573 |
Other | 9,960 | 6,936 |
Other accrued expenses and current liabilities | $ 45,146 | $ 37,891 |
Long-Term Debt - Components (De
Long-Term Debt - Components (Details) - USD ($) $ in Thousands | Apr. 30, 2018 | Apr. 30, 2017 | Apr. 01, 2014 |
Long-term debt | |||
Carrying value of debt | $ 595,886 | $ 594,920 | |
Less current portion | 16,284 | 11,530 | |
Long-term debt | 579,602 | 583,390 | |
First Lien Term Loan | |||
Long-term debt | |||
Carrying value of debt | 563,179 | 470,245 | |
Unamortized discount | 2,536 | 1,658 | $ 2,000 |
Deferred financing costs | 6,125 | 5,712 | |
ABL Facility | |||
Long-term debt | |||
Carrying value of debt | 103,353 | ||
Capital lease obligations | |||
Long-term debt | |||
Carrying value of debt | $ 18,564 | $ 15,611 | |
Interest rate | 5.50% | 5.50% | |
Installment notes | |||
Long-term debt | |||
Carrying value of debt | $ 14,143 | $ 5,711 | |
Unamortized discount | $ 1,534 | $ 751 | |
Installment notes | Maximum | |||
Long-term debt | |||
Interest rate | 5.00% | 5.00% |
Long-Term Debt - Acquisition De
Long-Term Debt - Acquisition Debt (Details) $ in Thousands | Jun. 07, 2017USD ($) | Sep. 27, 2016USD ($) | Jun. 01, 2016USD ($) | Apr. 01, 2014USD ($) | Apr. 30, 2018USD ($)loan | Apr. 30, 2017USD ($) | Apr. 30, 2016USD ($) |
Long-term debt | |||||||
Repayment of amounts outstanding under credit facility | $ 617,230 | $ 1,011,925 | $ 697,144 | ||||
Net amount of debt issued | 577,616 | 481,225 | |||||
Cash paid for interest | 28,613 | 26,443 | $ 34,557 | ||||
Write-off of debt discount and deferred financing fees | 74 | 7,103 | |||||
Term Loan Facilities | |||||||
Long-term debt | |||||||
Face amount of debt | $ 550,000 | ||||||
First Lien Term Loan | |||||||
Long-term debt | |||||||
Net amount of debt issued | 388,100 | ||||||
Original issue discount | 2,000 | $ 2,536 | 1,658 | ||||
Loan repayment | $ 381,200 | ||||||
Loan amortization installment frequency | quarterly | ||||||
Loan amortization installments | $ 1,400 | ||||||
Loan amortization installments (as a percent) | 0.25% | ||||||
First Lien Term Loan | Minimum | |||||||
Long-term debt | |||||||
Number of incremental loans | loan | 1 | ||||||
First Lien Term Loan | Maximum | |||||||
Long-term debt | |||||||
Fixed amount of incremental loan | $ 100,000 | ||||||
Second Lien Term Loan | |||||||
Long-term debt | |||||||
Net amount of debt issued | 158,400 | ||||||
Original issue discount | $ 1,600 | ||||||
Loan repayment | $ 160,000 | 160,000 | |||||
Write-off of debt discount and deferred financing fees | $ 5,400 | ||||||
Incremental First Lien Term Commitments Amendment | |||||||
Long-term debt | |||||||
Face amount of debt | $ 481,200 | ||||||
Reduction to interest rate margin at each pricing level (as a percent) | (25.00%) | ||||||
Write-off of debt discount and deferred financing fees | 1,500 | ||||||
Incremental First Lien Term Commitments Amendment | LIBOR | |||||||
Long-term debt | |||||||
Variable rate floor (as a percent) | 1.00% | ||||||
Margin added to variable rate (as a percent) | 3.50% | ||||||
Second amendment to First Lien Credit Agreement | |||||||
Long-term debt | |||||||
Face amount of debt | $ 577,600 | ||||||
Borrowing interest rate (as a percent) | 5.36% | ||||||
Reduction to interest rate margin at each pricing level (as a percent) | (50.00%) | ||||||
Loan repayment | $ 477,616 | $ 381,225 | |||||
Write-off of debt discount and deferred financing fees | 100 | ||||||
Second amendment to First Lien Credit Agreement | LIBOR | |||||||
Long-term debt | |||||||
Variable rate floor (as a percent) | 1.00% | ||||||
Margin added to variable rate (as a percent) | 3.00% | ||||||
ABL Facility | |||||||
Long-term debt | |||||||
Loan repayment | $ 94,000 |
Long-Term Debt - Asset-Based Le
Long-Term Debt - Asset-Based Lending Facility (Details) - ABL Facility $ in Millions | Apr. 30, 2018USD ($) |
Long-term debt | |
Maximum amount under the facility | $ 345 |
Available borrowings under the facility | 333.7 |
Swing-line | |
Long-term debt | |
Maximum amount under the facility | $ 34.5 |
Long-Term Debt - Prepayments (D
Long-Term Debt - Prepayments (Details) - USD ($) $ in Thousands | Jun. 01, 2016 | Apr. 30, 2018 | Apr. 30, 2017 |
Long-term debt | |||
Write-off of debt discount and deferred financing fees | $ 74 | $ 7,103 | |
Term Loan Facilities | |||
Long-term debt | |||
Percentage of the net proceeds of certain asset sales and issuances or incurrences of nonpermitted indebtedness to be used for mandatory prepayments | 100.00% | ||
Percentage of annual excess cash flow for mandatory prepayments | 50.00% | ||
Prepayment required related to excess cash flow | $ 0 | ||
Second Lien Term Loan | |||
Long-term debt | |||
Write-off of debt discount and deferred financing fees | $ 5,400 | ||
Attainment of certain total leverage ratio targets | Term Loan Facilities | Maximum | |||
Long-term debt | |||
Percentage of annual excess cash flow for mandatory prepayments | 25.00% | ||
Attainment of certain total leverage ratio targets | Term Loan Facilities | Minimum | |||
Long-term debt | |||
Percentage of annual excess cash flow for mandatory prepayments | 0.00% |
Long-Term Debt - Installment No
Long-Term Debt - Installment Notes (Details) - USD ($) $ in Thousands | Apr. 30, 2018 | Apr. 30, 2017 |
Long-term debt | ||
Long term debt | $ 595,886 | $ 594,920 |
Installment notes | ||
Long-term debt | ||
Long term debt | $ 14,143 | $ 5,711 |
Long-Term Debt - Maturities (De
Long-Term Debt - Maturities (Details) - USD ($) $ in Thousands | Apr. 30, 2018 | Apr. 30, 2017 | Apr. 01, 2014 |
Debt maturities | |||
2,019 | $ 16,284 | ||
2,020 | 14,225 | ||
2,021 | 12,339 | ||
2,022 | 10,076 | ||
2,023 | 552,327 | ||
Thereafter | 830 | ||
Total | 606,081 | ||
First Lien Term Loan | |||
Debt maturities | |||
2,019 | 5,776 | ||
2,020 | 5,776 | ||
2,021 | 5,776 | ||
2,022 | 5,776 | ||
2,023 | 548,736 | ||
Total | 571,840 | ||
Long Term Debt | |||
Unamortized discount | 2,536 | $ 1,658 | $ 2,000 |
Deferred financing costs | 6,125 | 5,712 | |
Installment notes | |||
Debt maturities | |||
2,019 | 4,048 | ||
2,020 | 3,292 | ||
2,021 | 2,989 | ||
2,022 | 2,553 | ||
2,023 | 2,521 | ||
Thereafter | 274 | ||
Total | 15,677 | ||
Long Term Debt | |||
Unamortized discount | 1,534 | $ 751 | |
Capital lease obligations | |||
Debt maturities | |||
2,019 | 6,460 | ||
2,020 | 5,157 | ||
2,021 | 3,574 | ||
2,022 | 1,747 | ||
2,023 | 1,070 | ||
Thereafter | 556 | ||
Total | $ 18,564 |
Retirement Plan (Details)
Retirement Plan (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Apr. 30, 2018 | Apr. 30, 2017 | Apr. 30, 2016 | |
Retirement Plan | |||
Employee contributions matched by employer (as a percent) | 50.00% | ||
Employee compensation eligible for employer match of employee contributions (as a percent) | 4.00% | ||
Employer contributions to defined contribution retirement plan | $ 4.3 | $ 3.7 | $ 1.7 |
Income Taxes - Components of In
Income Taxes - Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Apr. 30, 2018 | Apr. 30, 2017 | Apr. 30, 2016 | |
Components of income tax expense (benefit) | |||
Current federal | $ 30,827 | $ 37,164 | $ 28,043 |
Current state | 6,409 | 5,875 | 5,162 |
Total current | 37,236 | 43,039 | 33,205 |
Deferred federal | (14,796) | (19,011) | (19,993) |
Deferred state | (1,557) | (1,374) | (628) |
Total deferred | (16,353) | (20,385) | (20,621) |
Total provision for income taxes | $ 20,883 | $ 22,654 | $ 12,584 |
Income Taxes - Reconciliation t
Income Taxes - Reconciliation to Federal Statutory Rate (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Apr. 30, 2018 | Apr. 30, 2017 | Apr. 30, 2016 | |
Income tax expense (benefit) differences to amount computed by applying federal statutory rate | |||
Federal income taxes at statutory rate | $ 25,492 | $ 25,039 | $ 8,802 |
State income taxes, net of federal income tax benefit | 1,900 | 2,236 | 2,336 |
Net change in valuation allowance | 151 | 214 | (60) |
Nondeductible meals & entertainment | 822 | 761 | 627 |
338(h)(10) election | (6,936) | ||
Redeemable noncontrolling interests | 1,053 | 291 | |
Nondeductible transaction costs | 2 | 109 | 253 |
Benefit due to Tax Cuts and Jobs Act | (6,763) | ||
Other | (721) | 178 | 335 |
Total provision for income taxes | $ 20,883 | $ 22,654 | $ 12,584 |
Income Taxes - Deferred Income
Income Taxes - Deferred Income Taxes (Details) - USD ($) $ in Thousands | Apr. 30, 2018 | Apr. 30, 2017 |
Deferred income tax assets: | ||
Allowances on accounts and notes receivable | $ 3,540 | $ 5,792 |
Accrued payroll and related costs | 1,138 | 1,651 |
Insurance reserves | 1,734 | 1,139 |
Inventory costs | 2,013 | 2,430 |
Deferred compensation | 6,662 | 9,293 |
Equity compensation | 2,361 | 3,424 |
Derivative instrument | 561 | 1,488 |
Acquisition related costs | 1,955 | 1,732 |
Net operating loss carry-forwards | 1,965 | 2,949 |
Deferred rent | 488 | 996 |
Noncompete agreements | 681 | 819 |
Other deferred tax assets, net | 946 | 2,576 |
Total deferred income tax assets | 24,044 | 34,289 |
Less: Valuation allowance | (448) | (297) |
Total deferred income tax assets, net of valuation allowance | 23,596 | 33,992 |
Deferred income tax liabilities, net | ||
Amortization of intangible assets | (28,641) | (53,345) |
Rebates | (253) | (1,007) |
Depreciation | (3,596) | (3,808) |
Deferred financing costs | (1,848) | (2,652) |
Total deferred income tax liabilities | (34,338) | (60,812) |
Deferred income tax liabilities, net | $ (10,742) | $ (26,820) |
Income Taxes - Tax Act (Details
Income Taxes - Tax Act (Details) - USD ($) $ in Millions | 3 Months Ended | 4 Months Ended | 8 Months Ended | 9 Months Ended | 12 Months Ended |
Jan. 31, 2018 | Apr. 30, 2018 | Dec. 31, 2017 | Jan. 31, 2018 | Apr. 30, 2018 | |
Income Taxes | |||||
U.S. corporate income tax rate (as a percent) | 21.00% | 35.00% | 30.40% | ||
Provisional income tax benefit | $ 7.8 | $ 6.7 | |||
Decrease from provisional amount | $ 1.1 | $ 1.1 | |||
Decrease in deferred tax liabilities and tax expense | $ 6.9 |
Income Taxes - State Net Operat
Income Taxes - State Net Operating Loss Carryforwards and Valuation Allowances (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Apr. 30, 2018 | Apr. 30, 2017 | |
Valuation allowance | ||
Valuation allowance | $ 448 | $ 297 |
Valuation allowance increase (decrease) | 100 | |
State | ||
Operating loss carryforwards | ||
Net operating loss carry forwards | $ 20,400 | $ 21,100 |
Income Taxes - Valuation Allowa
Income Taxes - Valuation Allowances and Elections (Details) - USD ($) | 12 Months Ended | |
Apr. 30, 2018 | Apr. 30, 2017 | |
Income tax examinations | ||
Reserve for uncertain tax positions | $ 0 | $ 0 |
Liability for uncertain tax position | $ 0 | $ 0 |
State | Minimum | ||
Income tax examinations | ||
Statute of limitation period | 3 years | |
State | Maximum | ||
Income tax examinations | ||
Statute of limitation period | 4 years |
Stockholders' Equity (Details)
Stockholders' Equity (Details) $ in Thousands | 12 Months Ended |
Apr. 30, 2016USD ($)shares | |
Treasury Stock | |
Shares repurchased, cost | $ 5,827 |
Proceeds from reissuance of treasury stock | 4,900 |
Increase to Retained earnings (accumulated deficit) for difference between cost of treasury stock and proceeds from reissuance | $ 1 |
Treasury Stock | |
Treasury Stock | |
Number of shares repurchased | shares | 395 |
Shares repurchased, cost | $ 5,827 |
Equity-Based Compensation - Gen
Equity-Based Compensation - General (Details) shares in Millions | 12 Months Ended |
Apr. 30, 2018shares | |
Stock Options | |
Stock options | |
Vesting period (in years) | 4 years |
Term | 10 years |
Plan | |
Stock options | |
Shares authorized | 2.5 |
Number of shares available for grant | 2.4 |
Equity-Based Compensation - Sto
Equity-Based Compensation - Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Apr. 30, 2018 | Apr. 30, 2017 | Apr. 30, 2016 | |
Other disclosures | |||
Share-based compensation expense | $ 1,695 | $ 2,534 | $ 2,699 |
Selling, general and administrative expenses | |||
Other disclosures | |||
Share-based compensation expense | $ 1,700 | $ 2,400 | $ 2,700 |
Stock Options | |||
Number of Options | |||
Outstanding, beginning of the period (in shares) | 2,088,000 | ||
Options granted (in shares) | 63,000 | 0 | |
Options exercised (in shares) | (199,000) | ||
Outstanding, end of the period (in shares) | 1,952,000 | 2,088,000 | |
Exercisable at end of period (in shares) | 1,682,000 | ||
Vested and expected to vest at end of period (in shares) | 1,946,000 | ||
Weighted Average Exercise Price | |||
Outstanding, beginning of period (in dollars per share) | $ 13.49 | ||
Options granted (in dollars per share) | 37.49 | ||
Options exercised (in dollars per share) | 12.53 | ||
Outstanding, end of the period (in dollars per share) | 14.37 | $ 13.49 | |
Exercisable at end of period (in dollars per share) | 12.97 | ||
Vested and expected to vest at end of period (in dollars per share) | $ 14.33 | ||
Other disclosures | |||
Weighted Average Remaining Contractual Life, Outstanding (in years) | 6 years 6 months 7 days | 7 years 2 months 23 days | |
Weighted Average Remaining Contractual Life, Exercisable at end of period (in years) | 6 years 3 months 22 days | ||
Weighted Average Remaining Contractual Life, Vested and expected to vest at end of period (in years) | 6 years 6 months 7 days | ||
Aggregate Intrinsic Value, Outstanding | $ 33,209 | $ 47,336 | |
Aggregate Intrinsic Value, Exercisable at end of period | 30,599 | ||
Aggregate Intrinsic Value, Vested and expected to vest at end of period | 33,173 | ||
Intrinsic value of options exercised | 4,300 | $ 600 | $ 8,900 |
Unrecognized compensation cost | $ 1,100 | ||
Weighted-average period for recognition of unrecognized compensation expense (in years) | 2 years 1 month 6 days | ||
Stock Options | Selling, general and administrative expenses | |||
Other disclosures | |||
Share-based compensation expense | $ 1,700 |
Equity-Based Compensation - Bla
Equity-Based Compensation - Black Scholes Options - Pricing Model (Details) - Stock Options - $ / shares | 12 Months Ended | |
Apr. 30, 2018 | Apr. 30, 2017 | |
Fair Value Assumptions | ||
Volatility (as a percent) | 30.86% | 40.68% |
Expected life (years) | 6 years | 6 years |
Risk-free interest rate (as a percent) | 2.18% | 1.55% |
Weighted average grant date fair value (in dollars per share) | $ 12.81 | $ 9.68 |
Equity-Based Compensation - Res
Equity-Based Compensation - Restricted Stock Units (Details) - Restricted Stock Units $ / shares in Units, $ in Millions | 12 Months Ended |
Apr. 30, 2018USD ($)$ / sharesshares | |
Restricted stock units granted to employees (in shares) | shares | 21,766 |
Vesting period (in years) | 3 years |
Fair value on grant date (in dollars per share) | $ / shares | $ 37.49 |
Unrecognized compensation cost | $ | $ 0.7 |
Weighted-average period for recognition of unrecognized compensation expense (in years) | 2 years 7 months 6 days |
Stock Appreciation Rights, De80
Stock Appreciation Rights, Deferred Compensation and Redeemable Noncontrolling Interests (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Apr. 30, 2018 | Apr. 30, 2017 | Apr. 30, 2016 | |
Equity based compensation arrangements | |||
Long-term liabilities related to plans | $ 15,707 | $ 22,576 | |
Selling, general and administrative expenses | |||
Equity based compensation arrangements | |||
Expense related to equity based compensation arrangements | 4,000 | 3,700 | $ 2,900 |
Stock Appreciation Rights | |||
Equity based compensation arrangements | |||
Award liability as of beginning of year | 20,662 | 20,533 | |
Redemption notes | (28) | ||
Amounts redeemed | (1,036) | ||
Change in fair value | 2,318 | 157 | |
Award liability as of end of year | 21,944 | 20,662 | 20,533 |
Current liabilities related to plans | 308 | 878 | |
Long-term liabilities related to plans | $ 21,636 | 19,784 | |
Settlement period | 4 years | ||
Stock Appreciation Rights | Change in accounting for liability equity-based awards | |||
Equity based compensation arrangements | |||
Increase (decrease) to Accumulated deficit as a result of the change | 11,200 | ||
Deferred Compensation | |||
Equity based compensation arrangements | |||
Award liability as of beginning of year | $ 3,750 | 3,270 | |
Amounts redeemed | (1,733) | ||
Change in fair value | 205 | 480 | |
Award liability as of end of year | 2,222 | 3,750 | 3,270 |
Current liabilities related to plans | 133 | 300 | |
Long-term liabilities related to plans | $ 2,089 | 3,450 | |
Settlement period | 5 years | ||
Deferred Compensation | Change in accounting for liability equity-based awards | |||
Equity based compensation arrangements | |||
Increase (decrease) to Accumulated deficit as a result of the change | (200) | ||
Redeemable Noncontrolling Interests | |||
Equity based compensation arrangements | |||
Award liability as of beginning of year | $ 24,309 | 26,585 | |
Redemption notes | (5,354) | ||
Amounts redeemed | (9,664) | ||
Change in fair value | 1,525 | 3,078 | |
Award liability as of end of year | 16,170 | 24,309 | 26,585 |
Current liabilities related to plans | 463 | 1,733 | |
Long-term liabilities related to plans | $ 15,707 | $ 22,576 | |
Settlement period | 5 years | ||
Redeemable Noncontrolling Interests | Change in accounting for liability equity-based awards | |||
Equity based compensation arrangements | |||
Increase (decrease) to Accumulated deficit as a result of the change | $ (3,700) |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Apr. 30, 2018 | Apr. 30, 2017 |
Level 3 | ||
Fair Value Measurements | ||
Stock appreciation rights | $ 21,944 | $ 20,662 |
Deferred Compensation | 2,222 | 3,750 |
Noncontrolling interest holders | 16,170 | 24,309 |
Interest rate cap | Level 2 | ||
Fair Value Measurements | ||
Derivative assets | 543 | $ 88 |
Forward currency forward | Level 2 | ||
Fair Value Measurements | ||
Derivative liabilities | $ 5,108 |
Transactions With Related Par82
Transactions With Related Parties - Facilities Rental (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Apr. 30, 2018 | Apr. 30, 2017 | Apr. 30, 2016 | |
Transactions with related parties | |||
Aggregate future minimum payments due | $ 216,184 | ||
Affiliated partnerships or entities | Lease of warehouse facilities | |||
Transactions with related parties | |||
Aggregate future minimum payments due | 2,000 | ||
Affiliated partnerships or entities | Lease of warehouse facilities | Selling, general and administrative expenses | |||
Transactions with related parties | |||
Rent expense | $ 800 | $ 800 | $ 600 |
Transactions With Related Par83
Transactions With Related Parties - Purchased Inventories (Details) - Southern Wall Products, Inc. - Inventory purchases - USD ($) $ in Millions | 12 Months Ended | ||
Apr. 30, 2018 | Apr. 30, 2017 | Apr. 30, 2016 | |
Transactions with related parties | |||
Purchases from related party | $ 14 | $ 13 | $ 12.8 |
Accounts payable | |||
Transactions with related parties | |||
Due to SWP | $ 1.2 | $ 1.1 |
Transactions With Related Par84
Transactions With Related Parties - Management Agreement (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |
May 31, 2016 | Apr. 30, 2017 | Apr. 30, 2016 | |
Transactions with related parties | |||
Management fee | $ 188 | $ 2,250 | |
AEA Investors LP | Management agreement | |||
Transactions with related parties | |||
Annual fee | $ 2,300 | ||
AEA Investors LP | Management agreement | Selling, general and administrative expenses | |||
Transactions with related parties | |||
Quarterly installment for fee | $ 600 |
Commitments and Contingencies -
Commitments and Contingencies - Capital Leases (Details) $ in Millions | 12 Months Ended | |
Apr. 30, 2018USD ($)property | Apr. 30, 2017USD ($) | |
Capital leases | ||
Carrying value of property and equipment under capital leases | $ 17.9 | $ 15 |
Accumulated depreciation on property and equipment under capital leases | $ 10.3 | $ 8.3 |
Facility | ||
Capital leases | ||
Number of properties under capital lease | property | 1 | |
Capital lease obligations | Vehicles | Minimum | ||
Capital leases | ||
Term | 1 year | |
Capital lease obligations | Vehicles | Maximum | ||
Capital leases | ||
Term | 6 years | |
Capital lease obligations | Facility | ||
Capital leases | ||
Term | 11 years |
Commitments and Contingencies86
Commitments and Contingencies - Operating Leases (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Apr. 30, 2018 | Apr. 30, 2017 | Apr. 30, 2016 | |
Operating leases | |||
Rent expense under operating leases | $ 63.9 | $ 56.2 | $ 41.7 |
Minimum | |||
Operating leases | |||
Renewal option period | 1 year | ||
Maximum | |||
Operating leases | |||
Renewal option period | 5 years |
Commitments and Contingencies87
Commitments and Contingencies - Future Minimum Payments and Maturities of Leases (Details) $ in Thousands | Apr. 30, 2018USD ($) |
Future maturities of capital lease obligations | |
2,019 | $ 7,289 |
2,020 | 5,665 |
2,021 | 3,882 |
2,022 | 1,937 |
2,023 | 1,147 |
Thereafter | 571 |
Total | 20,491 |
Less: Interest | 1,927 |
Capitalized lease obligations | 18,564 |
Future minimum lease payments under noncancelable operating leases | |
2,018 | 59,529 |
2,019 | 52,815 |
2,020 | 43,120 |
2,021 | 29,299 |
2,022 | 17,820 |
Thereafter | 13,601 |
Total | $ 216,184 |
Segments - Number (Details)
Segments - Number (Details) - segment | 12 Months Ended | |
Apr. 30, 2018 | Apr. 30, 2017 | |
Segment Reporting Information [Line Items] | ||
Number of operating segments | 6 | |
Number of reportable segments | 1 | |
Number of geographic divisions | 6 | |
Reorganization of geographic regional reporting lines | ||
Segment Reporting Information [Line Items] | ||
Number of operating segments | 7 |
Segments - Net Sales, Adjusted
Segments - Net Sales, Adjusted EBITDA and Certain Other Measures (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2016 | Jul. 31, 2016 | Apr. 30, 2018 | Apr. 30, 2017 | Apr. 30, 2016 | |
Segment information | |||||||||||
Net sales | $ 614,977 | $ 562,523 | $ 591,846 | $ 549,800 | $ 2,511,469 | $ 2,319,146 | $ 1,858,182 | ||||
Gross Profit | $ 635,800 | $ 585,508 | $ 648,004 | $ 642,157 | 201,035 | $ 185,727 | $ 193,224 | $ 178,585 | 818,576 | 758,571 | 593,164 |
Depreciation and Amortization | 65,530 | 69,240 | 64,215 | ||||||||
Adjusted EBITDA | 199,258 | 188,229 | 138,183 | ||||||||
Total assets | 1,454,511 | 1,393,265 | 1,454,511 | 1,393,265 | 1,240,814 | ||||||
Geographic divisions | |||||||||||
Segment information | |||||||||||
Net sales | 2,487,557 | 2,298,871 | 1,842,634 | ||||||||
Gross Profit | 809,884 | 750,564 | 587,213 | ||||||||
Depreciation and Amortization | 64,491 | 68,001 | 63,093 | ||||||||
Adjusted EBITDA | 196,903 | 186,155 | 137,459 | ||||||||
Total assets | 1,434,371 | 1,376,655 | 1,434,371 | 1,376,655 | 1,217,871 | ||||||
Other. | |||||||||||
Segment information | |||||||||||
Net sales | 23,912 | 20,275 | 15,548 | ||||||||
Gross Profit | 8,692 | 8,007 | 5,951 | ||||||||
Depreciation and Amortization | 242 | 310 | 295 | ||||||||
Adjusted EBITDA | 2,355 | 2,074 | 724 | ||||||||
Total assets | 12,854 | 11,916 | 12,854 | 11,916 | 12,310 | ||||||
Corporate | |||||||||||
Segment information | |||||||||||
Depreciation and Amortization | 797 | 929 | 827 | ||||||||
Total assets | $ 7,286 | $ 4,694 | $ 7,286 | $ 4,694 | $ 10,633 |
Segments - Reconciliation of Ne
Segments - Reconciliation of Net Income to Adjusted EBITDA (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2016 | Jul. 31, 2016 | Apr. 30, 2018 | Apr. 30, 2017 | Apr. 30, 2016 | |
Segments | |||||||||||
Net income | $ 205,792 | $ 195,420 | $ 212,260 | $ 205,104 | $ 14,273 | $ 8,226 | $ 17,224 | $ 9,163 | $ 62,971 | $ 48,886 | $ 12,564 |
Interest expense | 31,395 | 29,360 | 37,418 | ||||||||
Write-off of debt discount and deferred financing fees | 74 | 7,103 | |||||||||
Interest income | (177) | (152) | (928) | ||||||||
Income tax expense (benefit) | 20,883 | 22,654 | 12,584 | ||||||||
Depreciation expense | 24,075 | 25,565 | 26,667 | ||||||||
Amortization expense | 41,455 | 43,675 | 37,548 | ||||||||
Stock appreciation income or (expense) | 2,318 | 148 | 1,988 | ||||||||
Redeemable noncontrolling interests | 1,868 | 3,536 | 880 | ||||||||
Equity-based compensation | 1,695 | 2,534 | 2,699 | ||||||||
Severance and other permitted costs | 581 | (157) | 379 | ||||||||
Transaction costs (acquisitions and other) | 3,370 | 2,249 | 3,751 | ||||||||
Gain on sale of assets | (509) | (338) | (645) | ||||||||
Management fee to related party | 188 | 2,250 | |||||||||
Effects of fair value adjustments to inventory | 324 | 946 | 1,009 | ||||||||
Change in fair value of financial instruments | $ 5,100 | 6,125 | 382 | 19 | |||||||
Secondary public offering costs | 1,525 | 1,385 | |||||||||
Debt transaction costs | 1,285 | 265 | |||||||||
Adjusted EBITDA | $ 199,258 | $ 188,229 | $ 138,183 |
Segments - Net Sales by Main Pr
Segments - Net Sales by Main Product Lines (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||
Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2016 | Jul. 31, 2016 | Apr. 30, 2018 | Apr. 30, 2017 | Apr. 30, 2016 | |
Revenue from external customers | |||||||
Total net sales | $ 614,977 | $ 562,523 | $ 591,846 | $ 549,800 | $ 2,511,469 | $ 2,319,146 | $ 1,858,182 |
Wallboard | |||||||
Revenue from external customers | |||||||
Total net sales | 1,109,552 | 1,058,400 | 870,952 | ||||
Ceilings | |||||||
Revenue from external customers | |||||||
Total net sales | 387,360 | 341,007 | 297,110 | ||||
Steel framing | |||||||
Revenue from external customers | |||||||
Total net sales | 411,630 | 374,151 | 281,340 | ||||
Other products | |||||||
Revenue from external customers | |||||||
Total net sales | $ 602,927 | $ 545,588 | $ 408,780 |
Accumulated Other Comprehensi92
Accumulated Other Comprehensive (Loss) Income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Apr. 30, 2018 | Apr. 30, 2017 | Apr. 30, 2016 | |
Accumulated other comprehensive (loss) income | |||
Balance | $ 514,606 | $ 311,160 | $ 299,572 |
Balance | 579,451 | 514,606 | 311,160 |
Reclassification of (decrease) increase in fair value financial instruments from Accumulated other comprehensive income (loss) | |||
Amount expected to be reclassified to earnings during next twelve months | 700 | ||
Cash Flow Hedge | |||
Accumulated other comprehensive (loss) income | |||
Balance | (884) | (1,148) | 10 |
Other comprehensive (loss) income before reclassification | 309 | (118) | (1,177) |
Reclassification to earnings from accumulated other comprehensive (loss) income | 1,016 | 382 | 19 |
Balance | $ 441 | $ (884) | $ (1,148) |
Earnings Per Common Share (Deta
Earnings Per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2016 | Jul. 31, 2016 | Apr. 30, 2018 | Apr. 30, 2017 | Apr. 30, 2016 | |
Computation of basic and diluted earnings per share of common stock | |||||||||||
Net income | $ 62,971 | $ 48,886 | $ 12,564 | ||||||||
Basic earnings per common share: | |||||||||||
Basic weighted average common shares outstanding (in shares) | 40,956 | 40,943 | 40,943 | 38,201 | 41,015,000 | 40,260,000 | 32,799,000 | ||||
Basic earnings per common share (in dollars per share) | $ 0.35 | $ 0.20 | $ 0.42 | $ 0.24 | $ 1.54 | $ 1.21 | $ 0.38 | ||||
Diluted earnings per common share: | |||||||||||
Basic weighted average common shares outstanding (in shares) | 40,956 | 40,943 | 40,943 | 38,201 | 41,015,000 | 40,260,000 | 32,799,000 | ||||
Add: Common Stock Equivalents | 1,148,000 | 810,000 | 326,000 | ||||||||
Diluted weighted average common shares outstanding (in shares) | 41,048 | 41,036 | 41,006 | 40,971 | 41,759 | 41,578 | 41,320 | 38,602 | 42,163,000 | 41,070,000 | 33,125,000 |
Diluted earnings per common share (in dollars per share) | $ 0.24 | $ 0.48 | $ 0.44 | $ 0.37 | $ 0.33 | $ 0.20 | $ 0.42 | $ 0.24 | $ 1.49 | $ 1.19 | $ 0.38 |
Condensed Parent Company Fina94
Condensed Parent Company Financial Information - Balance Sheets (Details) - USD ($) $ / shares in Units, $ in Thousands | Apr. 30, 2018 | Apr. 30, 2017 | Apr. 30, 2016 | Apr. 30, 2015 |
Condensed Parent Company Balance Sheets | ||||
Total assets | $ 1,454,511 | $ 1,393,265 | $ 1,240,814 | |
Stockholders’ equity: | ||||
Common stock, $0.01 par value, authorized 500,000 shares; 41,069 and 40,971 shares issued and outstanding as of April 30, 2018 and 2017, respectively | 411 | 410 | ||
Additional paid-in capital | 489,007 | 488,459 | ||
Accumulated deficit | 89,592 | 26,621 | ||
Accumulated other comprehensive income | 441 | (884) | ||
Total stockholders’ equity | $ 579,451 | $ 514,606 | $ 311,160 | $ 299,572 |
Stockholders’ equity parenthetical | ||||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | ||
Common stock, shares authorized | 500,000,000 | 500,000,000 | ||
Common stock, shares issued | 41,069,000 | 40,971,000 | ||
Common stock, shares outstanding | 41,069,000 | 40,971,000 | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | ||
Preferred stock, shares authorized | 50,000,000 | 50,000,000 | ||
Preferred stock, shares issued | 0 | 0 | ||
Parent Company | ||||
Condensed Parent Company Balance Sheets | ||||
Investment in subsidiary | $ 579,451 | $ 514,606 | ||
Total assets | 579,451 | 514,606 | ||
Stockholders’ equity: | ||||
Common stock, $0.01 par value, authorized 500,000 shares; 41,069 and 40,971 shares issued and outstanding as of April 30, 2018 and 2017, respectively | 411 | 410 | ||
Additional paid-in capital | 489,007 | 488,459 | ||
Accumulated deficit | 89,592 | 26,621 | ||
Accumulated other comprehensive income | 441 | (884) | ||
Total stockholders’ equity | $ 579,451 | $ 514,606 | ||
Stockholders’ equity parenthetical | ||||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | ||
Common stock, shares authorized | 500,000,000 | 500,000,000 | ||
Common stock, shares issued | 41,069,000 | 40,971,000 | ||
Common stock, shares outstanding | 41,069,000 | 40,971,000 |
Condensed Parent Company Fina95
Condensed Parent Company Financial Information - Statements of Operations and Comprehensive Income (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2016 | Jul. 31, 2016 | Apr. 30, 2018 | Apr. 30, 2017 | Apr. 30, 2016 | |
Condensed Parent Company Statements of Operations and Comprehensive Income | |||||||||||
Net income | $ 205,792 | $ 195,420 | $ 212,260 | $ 205,104 | $ 14,273 | $ 8,226 | $ 17,224 | $ 9,163 | $ 62,971 | $ 48,886 | $ 12,564 |
Comprehensive income | $ 64,296 | $ 49,150 | $ 11,406 | ||||||||
Weighted average common shares outstanding: | |||||||||||
Basic (in shares) | 40,956 | 40,943 | 40,943 | 38,201 | 41,015,000 | 40,260,000 | 32,799,000 | ||||
Diluted (in shares) | 41,048 | 41,036 | 41,006 | 40,971 | 41,759 | 41,578 | 41,320 | 38,602 | 42,163,000 | 41,070,000 | 33,125,000 |
Net income per share: | |||||||||||
Basic (in dollars per share) | $ 0.35 | $ 0.20 | $ 0.42 | $ 0.24 | $ 1.54 | $ 1.21 | $ 0.38 | ||||
Diluted (in dollars per share) | $ 0.24 | $ 0.48 | $ 0.44 | $ 0.37 | $ 0.33 | $ 0.20 | $ 0.42 | $ 0.24 | $ 1.49 | $ 1.19 | $ 0.38 |
Parent Company | |||||||||||
Condensed Parent Company Statements of Operations and Comprehensive Income | |||||||||||
Net income in subsidiaries | $ 62,971 | $ 48,886 | $ 12,564 | ||||||||
Net income | 62,971 | 48,886 | 12,564 | ||||||||
Comprehensive income | $ 64,296 | $ 49,150 | $ 11,406 | ||||||||
Weighted average common shares outstanding: | |||||||||||
Basic (in shares) | 41,015,000 | 40,260,000 | 32,799,000 | ||||||||
Diluted (in shares) | 42,163,000 | 41,070,000 | 33,125,000 | ||||||||
Net income per share: | |||||||||||
Basic (in dollars per share) | $ 1.54 | $ 1.21 | $ 0.38 | ||||||||
Diluted (in dollars per share) | $ 1.49 | $ 1.19 | $ 0.38 |
Condensed Parent Company Fina96
Condensed Parent Company Financial Information - Cash Flows (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Apr. 30, 2018 | Apr. 30, 2017 | Apr. 30, 2016 | |
Condensed Parent Company Statements of Cash Flows | |||
Cash flows | $ 21,876 | $ (4,511) | $ 6,788 |
Parent Company | |||
Condensed Parent Company Statements of Cash Flows | |||
Cash flows | 0 | 0 | 0 |
Dividends, loans or advances between parent company and subsidiaries | $ 0 | $ 0 | $ 0 |
Condensed Parent Company Fina97
Condensed Parent Company Financial Information - Restricted Net Assets and Dividends (Details) - Consolidated Subsidiaries - USD ($) $ in Thousands | 12 Months Ended | ||
Apr. 30, 2018 | Apr. 30, 2017 | Apr. 30, 2016 | |
Condensed Parent Company Financial Information | |||
Restricted net assets | $ 578,000 | ||
Cash dividends paid to parent company by consolidated subsidiaries | $ 0 | $ 0 | $ 0 |
Valuation and Qualifying Acco98
Valuation and Qualifying Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Apr. 30, 2018 | Apr. 30, 2017 | Apr. 30, 2016 | |
Allowance for Doubtful Accounts | |||
Allowance Rollforward | |||
Balance at beginning of period | $ (9,851) | $ (8,607) | $ (8,633) |
Provision / Additions charged to costs and expenses | (366) | (1,792) | (908) |
Charged to other accounts | (596) | (819) | 77 |
Deductions | 1,180 | 1,367 | 857 |
Balance at end of period | (9,633) | (9,851) | (8,607) |
Valuation Allowance on Deferred Tax Assets | |||
Allowance Rollforward | |||
Balance at beginning of period | $ (448) | (297) | (83) |
Provision / Additions charged to costs and expenses | (151) | (255) | |
Deductions | 41 | ||
Balance at end of period | $ (448) | $ (297) |
Selected Quarterly Financial 99
Selected Quarterly Financial Data (Unaudited) - (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||
Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2016 | Jul. 31, 2016 | Jan. 31, 2018 | Apr. 30, 2018 | Apr. 30, 2017 | Apr. 30, 2016 | |
Selected Quarterly Financial Data (Unaudited) | ||||||||||||
Net sales | $ 614,977 | $ 562,523 | $ 591,846 | $ 549,800 | $ 2,511,469 | $ 2,319,146 | $ 1,858,182 | |||||
Gross Profit | $ 635,800 | $ 585,508 | $ 648,004 | $ 642,157 | 201,035 | 185,727 | 193,224 | 178,585 | 818,576 | 758,571 | 593,164 | |
Net income | $ 205,792 | $ 195,420 | $ 212,260 | $ 205,104 | $ 14,273 | $ 8,226 | $ 17,224 | $ 9,163 | $ 62,971 | $ 48,886 | $ 12,564 | |
Weighted average shares outstanding: | ||||||||||||
Basic (in shares) | 40,956 | 40,943 | 40,943 | 38,201 | 41,015,000 | 40,260,000 | 32,799,000 | |||||
Diluted (in shares) | 41,048 | 41,036 | 41,006 | 40,971 | 41,759 | 41,578 | 41,320 | 38,602 | 42,163,000 | 41,070,000 | 33,125,000 | |
Net income (loss) per share: | ||||||||||||
Basic (in dollars per share) | $ 0.35 | $ 0.20 | $ 0.42 | $ 0.24 | $ 1.54 | $ 1.21 | $ 0.38 | |||||
Diluted (in dollars per share) | $ 0.24 | $ 0.48 | $ 0.44 | $ 0.37 | $ 0.33 | $ 0.20 | $ 0.42 | $ 0.24 | $ 1.49 | $ 1.19 | $ 0.38 | |
Provisional income tax benefit | $ 7,800 | $ 6,700 | ||||||||||
Decrease from provisional amount | $ 1,100 | $ 1,100 | ||||||||||
Interest rate swap and cap mark-to-market | $ 5,100 | $ 6,125 | $ 382 | $ 19 |
Subsequent Event (Details)
Subsequent Event (Details) $ in Thousands | Jun. 01, 2018USD ($)location | Sep. 27, 2016USD ($) | Apr. 30, 2018USD ($) | Jan. 31, 2018USD ($) | Oct. 31, 2017USD ($) | Jul. 31, 2017USD ($) | Apr. 30, 2017USD ($) | Jan. 31, 2017USD ($) | Oct. 31, 2016USD ($) | Jul. 31, 2016USD ($) | Apr. 30, 2018USD ($) | Apr. 30, 2017USD ($) | Apr. 30, 2016USD ($) | Jul. 31, 2018USD ($) |
Subsequent Event [Line Items] | ||||||||||||||
Drew down | $ 513,878 | $ 1,013,365 | $ 782,104 | |||||||||||
Capital lease assets | $ 17,900 | $ 15,000 | 17,900 | 15,000 | ||||||||||
Pro forma information | ||||||||||||||
Net sales | 614,977 | $ 562,523 | $ 591,846 | $ 549,800 | 2,511,469 | 2,319,146 | 1,858,182 | |||||||
Net income | $ 205,792 | $ 195,420 | $ 212,260 | $ 205,104 | $ 14,273 | $ 8,226 | $ 17,224 | $ 9,163 | $ 62,971 | $ 48,886 | $ 12,564 | |||
Customer relationships | ||||||||||||||
Purchase price | ||||||||||||||
Useful life | 10 years 10 months 24 days | 10 years 10 months 24 days | ||||||||||||
First Lien Term Loan | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Loan repayment | $ 381,200 | |||||||||||||
Subsequent Event | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Capital lease assets | $ 73,600 | |||||||||||||
Capital lease liabilities | $ 73,600 | |||||||||||||
Subsequent Event | Third Amendment | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Aggregate principal amount | $ 996,800 | |||||||||||||
Reduction to interest rate margin at each pricing level (as a percent) | 25.00% | |||||||||||||
Subsequent Event | Third Amendment | LIBOR | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Margin added to variable rate (as a percent) | 2.75% | |||||||||||||
Subsequent Event | ABL facility | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Drew down | $ 143,000 | |||||||||||||
Subsequent Event | First Lien Term Loan | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Loan repayment | $ 571,800 | |||||||||||||
Titan | ||||||||||||||
Pro forma information | ||||||||||||||
Net sales | $ 478,400 | |||||||||||||
Net income | 11,900 | |||||||||||||
Pro forma net sales | 2,989,900 | |||||||||||||
Pro forma operating income | $ 74,900 | |||||||||||||
Titan | Subsequent Event | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Number Of Locations | location | 30 | |||||||||||||
Number Of Provinces | location | 5 | |||||||||||||
Aggregate purchase price | $ 627,000 | |||||||||||||
Issuance preferred stock to current shareholders of Titan | 35,000 | |||||||||||||
Purchase price | ||||||||||||||
Preliminary fair value of consideration transferred | 627,000 | |||||||||||||
Issuance preferred stock to current shareholders of Titan | $ 35,000 |