Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Sep. 30, 2018 | Oct. 26, 2018 | |
Document And Entity Information | ||
Entity Registrant Name | PATRICK INDUSTRIES INC | |
Entity Central Index Key | 76,605 | |
Trading Symbol | patk | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding (in shares) | 24,006,927 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Emerging Growth Company | false | |
Entity Small Business | false |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Current Assets | ||
Cash and cash equivalents | $ 306 | $ 2,767 |
Trade receivables, net | 129,850 | 77,784 |
Inventories | 242,456 | 175,270 |
Prepaid expenses and other | 17,111 | 18,132 |
Total current assets | 389,723 | 273,953 |
Property, plant and equipment, net | 170,416 | 118,486 |
Goodwill | 258,113 | 208,044 |
Intangible assets, net | 396,417 | 263,467 |
Deferred financing costs, net | 3,784 | 2,184 |
Other non-current assets | 658 | 510 |
TOTAL ASSETS | 1,219,111 | 866,644 |
Current Liabilities | ||
Current maturities of long-term debt | 7,500 | 15,766 |
Accounts payable | 96,204 | 84,109 |
Accrued liabilities | 70,511 | 36,550 |
Total current liabilities | 174,215 | 136,425 |
Long-term debt, less current maturities, net | 594,334 | 338,111 |
Deferred tax liabilities, net | 21,302 | 13,640 |
Other long-term liabilities | 15,042 | 7,783 |
TOTAL LIABILITIES | 804,893 | 495,959 |
SHAREHOLDERS’ EQUITY | ||
Common stock | 162,925 | 163,196 |
Additional paid-in-capital | 25,480 | 8,243 |
Accumulated other comprehensive income | 115 | 66 |
Retained earnings | 225,698 | 199,180 |
TOTAL SHAREHOLDERS’ EQUITY | 414,218 | 370,685 |
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ 1,219,111 | $ 866,644 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2018USD ($)$ / sharesshares | Sep. 24, 2017USD ($)$ / sharesshares | Sep. 30, 2018USD ($)$ / sharesshares | Sep. 24, 2017USD ($)$ / sharesshares | |||
Income Statement [Abstract] | ||||||
NET SALES | $ 575,139 | $ 407,511 | $ 1,731,850 | $ 1,160,083 | ||
Cost of goods sold | 468,484 | 338,328 | 1,412,649 | 961,851 | ||
GROSS PROFIT | 106,655 | 69,183 | 319,201 | 198,232 | ||
Operating Expenses: | ||||||
Warehouse and delivery | 19,789 | 11,016 | 55,540 | 32,442 | ||
Selling, general and administrative | 33,284 | 22,756 | 98,999 | 63,755 | ||
Amortization of intangible assets | 8,873 | 5,237 | 25,140 | 14,239 | ||
Total operating expenses | 61,946 | 39,009 | 179,679 | 110,436 | ||
OPERATING INCOME | 44,709 | 30,174 | 139,522 | 87,796 | ||
Interest expense, net | 7,338 | 2,135 | 17,980 | 6,159 | ||
Income before income taxes | 37,371 | 28,039 | 121,542 | 81,637 | ||
Income taxes | 9,437 | 10,094 | 28,680 | 24,965 | ||
NET INCOME | $ 27,934 | $ 17,945 | $ 92,862 | $ 56,672 | ||
BASIC NET INCOME PER COMMON SHARE (in dollars per share) | $ / shares | $ 1.17 | $ 0.73 | [1] | $ 3.82 | $ 2.35 | [1] |
DILUTED NET INCOME PER COMMON SHARE (in dollars per share) | $ / shares | $ 1.15 | $ 0.72 | [1] | $ 3.77 | $ 2.32 | [1] |
Weighted average shares outstanding - Basic (in shares) | shares | 23,894 | 24,663 | [1] | 24,279 | 24,066 | [1] |
Weighted average shares outstanding - Diluted (in shares) | shares | 24,232 | 25,032 | [1] | 24,619 | 24,476 | [1] |
[1] | Net income per common share and weighted average shares outstanding, on both a basic and diluted basis, for the third quarter and nine months ended September 24, 2017, have been retroactively adjusted to reflect the impact of the three-for-two stock split paid on December 8, 2017. |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) Statement - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 24, 2017 | Sep. 30, 2018 | Sep. 24, 2017 | |
Statement of Other Comprehensive Income [Abstract] | ||||
Net income | $ 27,934 | $ 17,945 | $ 92,862 | $ 56,672 |
Other comprehensive gain (loss), net of tax: | ||||
Change in unrealized gain of hedge derivatives | 80 | 0 | 80 | 0 |
Foreign currency translation loss | (28) | 0 | (31) | 0 |
Total other comprehensive income | 52 | 0 | 49 | 0 |
COMPREHENSIVE INCOME | $ 27,986 | $ 17,945 | $ 92,911 | $ 56,672 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Sep. 24, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net income | $ 92,862 | $ 56,672 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 39,893 | 24,516 |
Stock-based compensation expense | 10,911 | 7,750 |
Amortization of convertible notes debt discount | 4,495 | 0 |
Deferred income taxes | (1,088) | (3,748) |
Other non-cash items | (2,739) | 499 |
Change in operating assets and liabilities, net of acquisitions of businesses: | ||
Trade receivables | (29,295) | (57,346) |
Inventories | (13,238) | (20,093) |
Prepaid expenses and other assets | 4,299 | (2,240) |
Accounts payable, accrued liabilities and other | 21,313 | 26,857 |
Net cash provided by operating activities | 127,413 | 32,867 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Capital expenditures | (26,073) | (13,238) |
Business acquisitions | (290,052) | (97,261) |
Other investing activities | 5,125 | 170 |
Net cash used in investing activities | (311,000) | (110,329) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Term debt borrowings | 36,981 | 0 |
Term debt repayments | (6,441) | (7,883) |
Borrowings on revolver | 954,535 | 353,442 |
Repayments on revolver | (877,931) | (358,365) |
Stock repurchases under buyback program | (75,028) | 0 |
Proceeds from convertible notes offering | 172,500 | 0 |
Purchase of convertible notes hedges | (31,481) | 0 |
Proceeds from sale of warrants | 18,147 | 0 |
Payments related to vesting of stock-based awards, net of shares tendered for taxes | (2,659) | (3,042) |
Proceeds from public offering of common stock, net of expenses | 0 | 93,306 |
Proceeds from exercise of stock options | 3 | 926 |
Payment of deferred financing/debt issuance costs | (7,485) | (995) |
Other financing activities | (15) | (5) |
Net cash provided by financing activities | 181,126 | 77,384 |
Decrease in cash and cash equivalents | (2,461) | (78) |
Cash and cash equivalents at beginning of year | 2,767 | 6,449 |
Cash and cash equivalents at end of period | $ 306 | $ 6,371 |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION | 1. BASIS OF PRESENTATION In the opinion of Patrick Industries, Inc. (“Patrick” or the “Company”), the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting of normal recurring adjustments) necessary to present fairly the Company’s financial position as of September 30, 2018 and December 31, 2017 , and its results of operations and cash flows for the three and nine months ended September 30, 2018 and September 24, 2017 . Patrick’s unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission and in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to those rules or regulations. For a description of significant accounting policies used by the Company in the preparation of its consolidated financial statements, please refer to Note 2 of the Notes to Consolidated Financial Statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 . The December 31, 2017 condensed consolidated statement of financial position data was derived from audited financial statements, but does not include all disclosures required by U.S. GAAP. Operating results for the third quarter and nine months ended September 30, 2018 are not necessarily indicative of the results to be expected for the year ending December 31, 2018 . The number of shares and per share amounts for the third quarter and nine months ended September 24, 2017 have been retroactively adjusted to reflect the three-for-two stock split of the Company's common stock, which was effected in the form of a common stock dividend paid on December 8, 2017. In preparation of Patrick’s condensed consolidated financial statements as of and for the third quarter and nine months ended September 30, 2018 , management evaluated all material subsequent events or transactions that occurred after the balance sheet date through the date of issuance of the Form 10-Q that required recognition or disclosure in the condensed consolidated financial statements. See Note 15 for an event that occurred subsequent to the balance sheet date. |
RECENTLY ISSUED ACCOUNTING PRON
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS | 2. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS Leases In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, " Leases (Topic 842) ", which requires that an entity recognize lease assets and lease liabilities on its statement of financial position for leases in excess of one year that were previously classified as operating leases under U.S. GAAP. The standard also requires companies to disclose in the footnotes to the financial statements information about the amount, timing, and uncertainty for the payments made for the lease agreements. The standard is effective for financial statements issued for annual and interim periods beginning after December 15, 2018 on a retroactive basis. Early adoption is permitted. In July 2018, the FASB issued ASU 2018-11, " Leases (Topic 842): Targeted Improvements ", which offers practical expedient alternatives to the retroactive adoption of Accounting Standards Codification (“ASC”) 842. Specifically, the practical expedients allow companies to recognize right of use lease assets and lease liabilities at the date of adoption only, rather than retrospectively for all periods presented, as well as practical expedients related to the presentation of lease components. The Company anticipates it will utilize the practical expedients under ASU 2018-11, and as a result, will reflect the adoption of ASC 842 in its condensed consolidated statement of financial position as of January 1, 2019, and will not retroactively reflect the provisions of ASC 842 in its 2017 and 2018 comparative statements of financial position. In 2017, the Company established an implementation team to develop a plan to assess changes to processes and systems necessary to adopt the new standard. The implementation team has completed its technical assessment of assumptions and methods to be used in adopting the standard, and is currently working with a third party lease administrator in finalizing data extraction of lease information to a third party lease accounting system, with the expectation to complete data extraction procedures in late December 2018. The adoption of this new accounting standard is expected to have a material impact on the reporting of lease assets and lease liabilities on the condensed consolidated statements of financial position and is not expected to have a material impact on the condensed consolidated statements of financial position as a whole or on the results of operations or cash flows. Stock Compensation In May 2017, the FASB issued a new accounting standard that provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting related to changes to such awards. The updated guidance is effective for interim and annual periods beginning after December 15, 2017 and early adoption is permitted. The Company adopted this new standard as of January 1, 2018 as required, and since it does not have a history of modifying share-based payment awards, has determined that the updated requirements did not have an impact on its condensed consolidated financial statements for the periods presented. Cash Flow Statement Classifications In August 2016, the FASB issued a new accounting standard related to the classification of certain cash receipts and cash payments in the statement of cash flows. This standard is effective for financial statements issued for annual and interim periods beginning after December 15, 2017. The standard may be applied on a retrospective basis and early adoption is permitted. The Company adopted the new standard as of January 1, 2018 as required and has determined that its implementation did not have a material impact on its condensed consolidated statements of cash flows for the periods presented. Goodwill Impairment In January 2017, the FASB issued a new accounting standard that simplifies the accounting for goodwill impairments by eliminating step two from the goodwill impairment test. The standard requires that the impairment loss be measured as the excess of the reporting unit's carrying amount over its fair value. It eliminates the second step that requires the impairment to be measured between the implied value of a reporting unit's goodwill and its carrying value. The standard is effective for annual and any interim impairment tests for periods beginning after December 15, 2019 and early adoption is permitted. The Company is currently evaluating the effect of adopting this new accounting standard and has not yet determined the impact that its implementation will have on its condensed consolidated financial statements. Definition of a Business In January 2017, the FASB issued a new accounting standard that clarifies the definition of a business with the objective of adding guidance to assist companies with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The standard is effective for financial statements issued for annual and interim periods beginning after December 15, 2017 and may be applied on a retrospective basis with early adoption permitted. The Company adopted this new standard as of January 1, 2018 as required and determined that its implementation did not have a material impact on the Company's condensed consolidated financial statements for the periods presented. Hedging Activities In August 2017, the FASB issued ASU 2017-12, " Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities ", which is codified in ASC 815. The ASU is effective for financial statements issued for annual and interim periods beginning after December 15, 2018 and early adoption is permitted. This ASU makes a number of targeted amendments that will enable entities to more clearly portray the economics of their risk management activities in the financial statements and simplify the application of hedge accounting in certain situations. The Company adopted ASU 2017-12 in August 2018 in anticipation of derivative swap arrangements which were entered into in the third quarter of 2018 and determined that its implementation did not have a material impact on the Company's condensed consolidated financial statements for the periods presented. See Notes 9 and 10 for additional information. |
REVENUE RECOGNITION
REVENUE RECOGNITION | 9 Months Ended |
Sep. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE RECOGNITION | 3. REVENUE RECOGNITION Effective January 1, 2018, the Company adopted FASB ASU No. 2014-09, Revenue from Contracts with Customers (commonly referred to as “Topic 606”), which requires a company to recognize revenue when it transfers goods or services to customers in an amount that reflects the consideration that the company expects to receive. The Company adopted Topic 606 using the modified retrospective method and applied it to those contracts which were not completed as of the adoption date. The adoption of the new revenue standard did not have a material impact on the Company’s consolidated financial position, results of operations, or revenues as of the adoption date. Revenue Recognition Revenues are recognized when or as control of the promised goods or services transfers to the Company's customers in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. The transaction price for contracts may include forms of variable consideration, including reductions to the transaction price for volume discounts and rebates. To the extent a contract is deemed to have multiple performance obligations, the Company allocates the transaction price of the contract to each performance obligation using the standalone selling price of each distinct good or service in the contract. Disaggregation of Revenue In the following table, revenue from contracts with customers, net of intersegment sales, is disaggregated by market type and by reportable operating segments: Third Quarter Ended September 30, 2018 (thousands) Manufacturing Distribution Total Reportable Operating Segments Market type: Recreational Vehicle $ 262,936 $ 91,637 $ 354,573 Manufactured Housing 41,428 26,334 67,762 Industrial 63,429 8,906 72,335 Marine 77,421 3,048 80,469 Total $ 445,214 $ 129,925 $ 575,139 Nine Months Ended September 30, 2018 (thousands) Manufacturing Distribution Total Reportable Operating Segments Market type: Recreational Vehicle $ 847,944 $ 280,082 $ 1,128,026 Manufactured Housing 124,406 75,946 200,352 Industrial 186,890 25,701 212,591 Marine 184,848 6,033 190,881 Total $ 1,344,088 $ 387,762 $ 1,731,850 ` Description of Products and Services The Company is a major manufacturer of component products and a distributor of building products and materials serving original equipment manufacturers (“OEMs”). The following is a description of the principal activities, by reportable segments, from which the Company generates its revenue. See Note 14 for more detailed information about the Company's reportable operating segments. Manufacturing The Company’s Manufacturing segment revenue is primarily derived from the sale of laminated products that are utilized to produce furniture, shelving, walls, countertops, and cabinet products, cabinet doors, fiberglass bath fixtures and tile systems, hardwood furniture, vinyl printing, solid surface, granite, and quartz countertop fabrication, recreational vehicle painting, fabricated aluminum products, fiberglass and plastic components, softwoods lumber, custom cabinetry, polymer-based flooring, electrical systems components, and other products. Manufacturing segment revenue is recognized when control of the products transfers to the customer which is the point when the customer gains the ability to direct the use of and obtain substantially all of the remaining benefits from the asset, which is generally upon delivery of goods. In limited circumstances, where the products are customer specific with no alternative use to the Company and the Company has a legally enforceable right to payment for performance to date with a reasonable margin, revenue is recognized over the contract term based on the cost-to-cost method. The Company uses this measure of progress because it best depicts the transfer of value to the customer and correlates with the amount of consideration to which the entity expects to be entitled in exchange for transferring the promised goods to the customer. However, revenue recognized based on the cost-to-cost method does not constitute a material amount of total Manufacturing segment revenue and consolidated net sales. Distribution The Company’s Distribution segment revenue is primarily derived from the resale of pre-finished wall and ceiling panels, drywall and drywall finishing products, appliances, electronics and audio systems components, wiring, electrical and plumbing products, fiber reinforced polyester products, cement siding, interior passage doors, roofing products, laminate and ceramic flooring, shower doors, furniture, fireplaces and surrounds, interior and exterior lighting products, and other miscellaneous products. The Company acts as a principal in such arrangements because it controls the promised goods before delivery to the customer. Distribution segment revenue from product sales is recognized on a gross basis upon delivery of goods at which point control transfers to the customer. The Distribution segment also generates revenue by providing marketing services for other manufacturers in exchange for agreed upon commissions. The commission revenue is recognized in the amount of expected commissions to be collected from the manufacturer upon delivery of goods to the customer. The overall commission business is not material to the Company’s consolidated net sales. Significant Judgments and Practical Expedients Applied Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring goods. Sales and other taxes collected concurrent with revenue-producing activities are excluded from revenue. Incidental items that are immaterial in the context of the contract are not recognized as separate performance obligations to which a portion of revenue would otherwise be allocated. The Company records freight billed to customers in net sales. The corresponding costs incurred for shipping and handling related to these customer billed freight costs are recorded as costs to fulfill the contract and are included in warehouse and delivery expenses. The Company’s contracts across each of its businesses typically do not result in situations where there is a time period greater than one year between performance under the contract and collection of the related consideration. The Company elected the practical expedient under Topic 606 related to significant financing components, where the Company expects, at contract inception, that the period between the entity’s transfer of a promised good or service to a customer and the customer’s payment for that good or service will be one year or less. The Company also applies the practical expedient in Topic 606 related to costs to obtain a contract and recognizes the incremental costs of obtaining contracts as an expense when incurred if the amortization period of the incurred costs that the Company otherwise would have capitalized is one year or less. These costs are included in selling, general and administrative expenses. Contract Balances The Company typically invoices the customer after shipment of the promised goods, at which time it has an unconditional right to payment. In limited circumstances, the Company may receive upfront payments from customers prior to satisfaction of a performance obligation in both the manufacturing and distribution businesses, in which case a contract liability is recorded. Contract liabilities are not material to the consolidated financial statements. The following table provides information about contract balances: (thousands) September 30, 2018 At Adoption Receivables, which are included in trade receivables, net $ 126,613 $ 75,926 Contract liabilities 2,523 1,310 Significant changes in the contract liabilities balance during the nine months ended September 30, 2018 are as follows: (thousands) Contract Liabilities Revenue recognized that was included in the contract liability balance at the beginning of the period $(1,165) Increases due to cash received, excluding amounts recognized as revenue during the period 2,190 Accrued customer deposits related to business combinations 188 Transaction Price Allocated to the Remaining Performance Obligation The Company applies the practical expedient in paragraph 606-10-50-14 and does not disclose information about remaining performance obligations that have original expected durations of one year or less. The Company does not have material contracts that have original expected durations of more than one year. |
INVENTORIES
INVENTORIES | 9 Months Ended |
Sep. 30, 2018 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | 4. INVENTORIES Inventories are stated at the lower of cost (First-In, First-Out (FIFO) Method) and net realizable value and consist of the following classes: (thousands) September 30, 2018 December 31, 2017 Raw materials $ 128,897 $ 96,846 Work in process 13,898 10,720 Finished goods 24,439 22,936 Less: reserve for inventory obsolescence (4,014 ) (3,087 ) Total manufactured goods, net 163,220 127,415 Materials purchased for resale (distribution products) 81,621 49,392 Less: reserve for inventory obsolescence (2,385 ) (1,537 ) Total materials purchased for resale (distribution products), net 79,236 47,855 Total inventories $ 242,456 $ 175,270 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 9 Months Ended |
Sep. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS | 5. GOODWILL AND INTANGIBLE ASSETS The Company acquired intangible assets in various acquisitions in 2017 and through the first nine months of 2018 that were determined to be business combinations. The goodwill recognized is expected to be deductible for income tax purposes for each of the 2018 and 2017 acquisitions with the exception of the acquisitions of Marine Accessories Corporation and Leisure Product Enterprises, LLC in 2018 and 2017, respectively. See Note 6 for further details. Goodwill and intangible assets are allocated to the Company’s reporting units on the date they are initially recorded. Goodwill and indefinite-lived intangible assets are not amortized but are subject to an impairment test based on their estimated fair value performed annually in the fourth quarter (or under certain circumstances more frequently as warranted). Goodwill impairment testing is performed at the reporting unit level, one level below the business segment . Finite-lived intangible assets that meet certain criteria continue to be amortized over their useful lives and are also subject to an impairment test based on estimated undiscounted cash flows when impairment indicators exist. The Company assesses finite-lived intangible assets for impairment if events or changes in circumstances indicate that the carrying value may exceed the fair value. No impairment was recognized during the first nine months ended September 30, 2018 and September 24, 2017 related to goodwill, indefinite-lived intangible assets or finite-lived intangible assets. Goodwill Changes in the carrying amount of goodwill for the nine months ended September 30, 2018 by segment are as follows: (thousands) Manufacturing Distribution Total Balance - December 31, 2017 $ 179,471 $ 28,573 $ 208,044 Acquisitions 40,144 13,017 53,161 Adjustment to prior year preliminary purchase price allocation (4,070 ) 978 (3,092 ) Balance - September 30, 2018 $ 215,545 $ 42,568 $ 258,113 Intangible Assets Intangible assets are comprised of customer relationships, non-compete agreements and trademarks. Customer relationships and non-compete agreements represent finite-lived intangible assets that have been recorded in the Manufacturing and Distribution segments along with related amortization expense. As of September 30, 2018 , the remaining intangible assets balance of $396.4 million is comprised of $82.2 million of trademarks which have an indefinite life, and therefore, no amortization expense has been recorded, and $314.2 million pertaining to customer relationships and non-compete agreements which are being amortized over periods ranging from three to 19 years. For the finite-lived intangible assets attributable to the 2018 acquisitions, the useful life pertaining to non-compete agreements was three years for Aluminum Metals Company, LLC and five years for Metal Moulding Corporation , Indiana Marine Products , Collins & Company, Inc. , Dehco, Inc., Dowco, Inc., Marine Accessories Corporation, and Engineered Metals and Composites, Inc. The useful life pertaining to customer relationships for all of the 2018 acquisitions is anticipated to be 10 years. Amortization expense for the Company’s intangible assets in the aggregate was $25.1 million and $14.2 million for the nine months ended September 30, 2018 and September 24, 2017 , respectively. Intangible assets, net consist of the following as of September 30, 2018 and December 31, 2017 : (thousands) September 30, 2018 Weighted Average Useful Life December 31, 2017 Weighted Average Useful Life Customer relationships $ 369,339 10.1 $ 239,053 10.2 Non-compete agreements 21,566 4.7 15,564 4.2 Trademarks 82,250 Indefinite 60,448 Indefinite 473,155 315,065 Less: accumulated amortization (76,738 ) (51,598 ) Intangible assets, net $ 396,417 $ 263,467 Changes in the carrying value of intangible assets for the nine months ended September 30, 2018 by segment are as follows: (thousands) Manufacturing Distribution Total Balance - December 31, 2017 $ 220,540 $ 42,927 $ 263,467 Acquisitions 117,012 39,023 156,035 Amortization (20,207 ) (4,933 ) (25,140 ) Adjustment to prior year preliminary purchase price allocation 2,070 (15 ) 2,055 Balance - September 30, 2018 $ 319,415 $ 77,002 $ 396,417 |
ACQUISITIONS
ACQUISITIONS | 9 Months Ended |
Sep. 30, 2018 | |
Business Combinations [Abstract] | |
ACQUISITIONS | 6. ACQUISITIONS General The Company completed eight acquisitions involving 12 companies in the first nine months of 2018 and seven acquisitions involving 13 companies in 2017 , including four acquisitions involving six companies in the first nine months of 2017 . Each of the acquisitions was funded through borrowings under the Company’s credit facility in effect at the time of acquisition. Assets acquired and liabilities assumed in the individual acquisitions were recorded on the Company’s condensed consolidated statements of financial position at their estimated fair values as of the respective dates of acquisition. In general, the acquisitions described below provided the opportunity for the Company to either establish a new presence in a particular market and/or expand its product offerings in an existing market and increase its market share and per unit content. For each acquisition, the excess of the purchase consideration over the fair value of the net assets acquired was recorded as goodwill, which represents the value of leveraging the Company’s existing purchasing, manufacturing, sales, and systems resources with the organizational talent and expertise of the acquired companies’ respective management teams to maximize efficiencies, revenue impact, market share growth, and net income. The goodwill recognized is expected to be deductible for income tax purposes for each of the 2017 and 2018 acquisitions with the exception of Leisure Product Enterprises, LLC and Marine Accessories Corporation, for which goodwill is expected to be partially deductible for income tax purposes. Intangible asset values were estimated using income based valuation methodologies. See Note 5 for information regarding the amortization periods assigned to finite-lived intangible assets. For the third quarter ended September 30, 2018 , revenue and operating income of approximately $82.4 million and $8.8 million , respectively, were included in the Company's condensed consolidated statements of income relating to the 12 businesses acquired in the first nine months of 2018. The first nine months of 2018 included revenue and operating income of approximately $160.0 million and $17.3 million , respectively, related to these acquisitions. Acquisition-related costs in the aggregate associated with the businesses acquired in the first nine months of 2018 were immaterial. For the third quarter ended September 24, 2017 , revenue and operating income of approximately $29.3 million and $4.0 million was included in the Company’s condensed consolidated statements of income relating to the six businesses acquired in the first nine months of 2017 . The first nine months of 2017 included revenue and operating income of approximately $47.7 million and $6.0 million , respectively, related to these acquisitions. Acquisition-related costs in the aggregate associated with the businesses acquired in the first nine months of 2017 were immaterial. Contingent Consideration In connection with certain 2018 and 2017 acquisitions as noted below, if certain financial targets for the acquired businesses are achieved, the Company will be required to pay additional cash consideration. The Company has recorded a liability for the fair value of the contingent consideration related to each of these acquisitions as part of the initial purchase price based on the present value of the expected future cash flows and the probability of future payments. As required, the liability for the contingent consideration associated with each of these acquisitions will be measured quarterly at fair value and the Company could record adjustments in future periods. The aggregate fair value of the estimated contingent consideration payments was $15.8 million , $3.9 million of which is included in the line item "Accrued liabilities" and $11.9 million is included in “Other long-term liabilities” on the condensed consolidated statement of financial position as of September 30, 2018. The liability for continent consideration expires at various dates through December 2023. The contingent consideration arrangements are subject to a maximum payment amount of up to $22.0 million in the aggregate. 2018 Acquisitions Metal Moulding Corporation ( “ MMC” ) In February 2018, the Company completed the acquisition of the business and certain assets of Madison, Tennessee-based MMC, a manufacturer of custom metal fabricated products, primarily for the marine market, including hinges, arm rests, brackets, panels and trim, as well as plastic products including boxes, inlay tables, steps, and related components, for a net initial purchase price of $19.9 million , plus subsequent contingent consideration over a one -year period based on future performance. The Company recorded a preliminary fair value estimate of the contingent consideration of $1.4 million , which is included in the line item “ Accrued liabilities ” on the condensed consolidated statement of financial position as of September 30, 2018 . The results of operations for MMC are included in the Company’s condensed consolidated financial statements and the Manufacturing operating segment from the date of acquisition. The preliminary purchase price allocation is subject to final review and approval, and thus all required purchase accounting adjustments are subject to change within the measurement period as the Company finalizes its fair value estimates. Aluminum Metals Company, LLC (“AMC” ) In February 2018, the Company completed the acquisition of the business and certain assets of Elkhart, Indiana-based AMC, a manufacturer of aluminum products including coil, fabricated sheets and extrusions, in addition to roofing products, primarily for the recreational vehicle (“RV”), industrial, and marine markets, for a net purchase price of $17.8 million . The results of operations for AMC are included in the Company’s condensed consolidated financial statements and the Manufacturing operating segment from the date of acquisition. The preliminary purchase price allocation is subject to final review and approval, and thus all required purchase accounting adjustments are subject to change within the measurement period as the Company finalizes its fair value estimates. IMP Holdings, LLC d/b/a Indiana Marine Products (“IMP”) In March 2018, the Company completed the acquisition of the business and certain assets of Angola, Indiana-based IMP, a manufacturer of fully-assembled helm assemblies, including electrical wiring harnesses, dash panels, instrumentation and gauges, and other products primarily for the marine market, for a net initial purchase price of $18.6 million , plus subsequent contingent consideration payments over a three -year period based on future performance. The Company recorded a preliminary fair value estimate of the contingent consideration of $7.9 million , which is included in the line item “ Other long-term liabilities ” on the condensed consolidated statement of financial position as of September 30, 2018 . The results of operations for IMP are included in the Company’s condensed consolidated financial statements and the Manufacturing operating segment from the date of acquisition. The preliminary purchase price allocation is subject to final review and approval, and thus all required purchase accounting adjustments are subject to change within the measurement period as the Company finalizes its fair value estimates. Collins & Company, Inc. (“Collins”) In March 2018, the Company completed the acquisition of the business and certain assets of Bristol, Indiana-based Collins, a distributor of appliances, trim products, fuel systems, flooring, tile, and other related building materials primarily to the RV market as well as the housing and industrial markets, for a net purchase price of $40.0 million . The results of operations for Collins are included in the Company’s condensed consolidated financial statements and the Distribution operating segment from the date of acquisition. The preliminary purchase price allocation is subject to final review and approval, and thus all required purchase accounting adjustments are subject to change within the measurement period as the Company finalizes its fair value estimates. Dehco, Inc. (“Dehco”) In April 2018, the Company completed the acquisition of Dehco, a distributor and manufacturer of flooring, kitchen and bath products, adhesives and sealants, electronics, appliances and accessories, LP tanks, and other related building materials, primarily for the RV market as well as the manufactured housing (“MH”), marine and other industrial markets, for a net purchase price of $52.8 million . Dehco has operating facilities in Indiana, Oregon, Pennsylvania and Alabama. The results of operations for Dehco are included in the Company’s condensed consolidated financial statements and the Manufacturing and Distribution operating segments from the date of acquisition. The preliminary purchase price allocation is subject to final review and approval, and thus all required purchase accounting adjustments are subject to change within the measurement period as the Company finalizes its fair value estimates. Dowco, Inc. (“Dowco”) In May 2018, the Company completed the acquisition of Dowco, a designer and manufacturer of custom designed boat covers and bimini tops, full boat enclosures, mounting hardware, and other accessories and components for the marine market, for a net purchase price of $56.9 million . Dowco has operating facilities in Wisconsin, Missouri, Indiana, and Minnesota. The results of operations for Dowco are included in the Company’s condensed consolidated financial statements and the Manufacturing operating segment from the date of acquisition. The preliminary purchase price allocation is subject to final review and approval, and thus all required purchase accounting adjustments are subject to change within the measurement period as the Company finalizes its fair value estimates. Marine Accessories Corporation (“MAC”) In June 2018, the Company completed the acquisition of Maryville, Tennessee-based MAC, a manufacturer, distributor and aftermarket supplier of custom tower and canvas products and other related accessories to OEMs, dealers, retailers and distributors within the marine market, as well as direct to consumers, for a net purchase price of $58.2 million . The results of operations for MAC are included in the Company’s condensed consolidated financial statements and the Manufacturing and Distribution operating segments from the date of acquisition. The preliminary purchase price allocation is subject to final review and approval, and thus all required purchase accounting adjustments are subject to change within the measurement period as the Company finalizes its fair value estimates. Engineered Metals and Composites, Inc. (“EMC”) In September 2018, the Company completed the acquisition of West Columbia, South Carolina-based EMC, a designer and manufacturer of custom marine towers, frames, and other fabricated component products for OEMs in the marine industry, for a net initial purchase price of $25.9 million , plus subsequent contingent consideration over a three -month period based on future performance. The Company recorded a preliminary fair value estimate of the contingent consideration of $2.5 million , which is included in the line item “Accrued liabilities ” on the condensed consolidated statement of financial position as of September 30, 2018 . The results of operations for EMC are included in the Company’s condensed consolidated financial statements and the Manufacturing operating segment from the date of acquisition. The preliminary purchase price allocation is subject to final review and approval, and thus all required purchase accounting adjustments are subject to change within the measurement period as the Company finalizes its fair value estimates. 2017 Acquisitions Medallion Plastics, Inc. (“Medallion”) In March 2017, the Company acquired the business and certain assets of Elkhart, Indiana-based Medallion, a designer, engineer and manufacturer of custom thermoformed products and components which include dash and trim panels and fender skirts for the RV market, and complete interior packages, bumper covers, hoods, and trims for the automotive, specialty transportation and other industrial markets, for a net purchase price of $9.9 million . The results of operations for Medallion are included in the Company’s condensed consolidated financial statements and the Manufacturing operating segment from the date of acquisition. Leisure Product Enterprises, LLC (“LPE”) In April 2017, the Company acquired 100% of the membership interests of LPE for a net purchase price of $73.3 million . LPE is comprised of three complementary manufacturing companies primarily serving the marine and industrial markets: Marine Electrical Products, located in Lebanon, Missouri, supplies marine OEMs with fully-assembled boat dash and helm assemblies, including electrical wire harnesses as well as custom parts and assemblies for the industrial, commercial, and off-road vehicle markets; Florida Marine Tanks, located in Henderson, North Carolina, supplies aluminum fuel and holding tanks for marine and industrial customers; and Marine Concepts/Design Concepts, with facilities located in Sarasota, Florida and Cape Coral, Florida, designs, engineers and manufactures CNC plugs, open and closed composite molds, and CNC molds for fiberglass boat manufacturers. The results of operations for LPE are included in the Company’s condensed consolidated financial statements and the Manufacturing operating segment from the date of acquisition. The purchase price allocation and all required purchase accounting adjustments were finalized in the first quarter of 2018, and resulted in changes from previously reported estimated amounts as of December 31, 2017 that include a $0.6 million decrease to goodwill and $0.9 million increase to intangible assets, the net of which was offset by a $0.3 million increase to the deferred tax liability. There was no material impact to the condensed consolidated statement of income related to these changes in the first quarter of 2018 . Indiana Technologies, Inc. d/b/a Wire Design (“Wire Design”) In July 2017, the Company acquired the business and certain assets of Elkhart, Indiana-based Wire Design, a manufacturer of wire harnesses for the RV, marine and industrial markets, for a net purchase price of $10.8 million . The results of operations for Wire Design are included in the Company’s condensed consolidated financial statements and the Manufacturing operating segment from the date of acquisition. The purchase price allocation and all required purchase accounting adjustments were finalized in the first quarter of 2018, and resulted in changes from previously reported estimated amounts as of December 31, 2017 that include a $0.2 million decrease to goodwill with a corresponding $0.2 million increase to intangible assets. There was no material impact to the condensed consolidated statement of income related to these changes in the first quarter of 2018 . Baymont, Inc. (“Baymont”) In September 2017, the Company acquired the business and certain assets of Baymont, a manufacturer and supplier of fiberglass showers, tubs, and tile systems for the MH and industrial markets, with operating facilities located in Golden, Mississippi and Belmont, Mississippi. The net purchase price was $3.8 million , plus subsequent contingent consideration payments over a six -year period based on future performance. The Company recorded a preliminary fair value estimate of the contingent consideration of $5.1 million at the date of acquisition, which was included in the line item “ Other long-term liabilities ” on the condensed consolidated statement of financial position as of December 31, 2017. In the first nine months of 2018, the fair value estimate of the contingent consideration was decreased by $1.1 million to $4.0 million , with a corresponding $1.1 million decrease to goodwill. The results of operations for Baymont are included in the Company’s condensed consolidated financial statements and the Manufacturing operating segment from the date of acquisition. The purchase price allocation and all required purchase accounting adjustments were finalized in the third quarter of 2018. Changes from previously reported estimated amounts as of December 31, 2017 include a $0.3 million increase to property, plant and equipment, net, a $0.9 million increase to other intangible assets, and a $1.7 million decrease to goodwill. There was no material impact to the condensed consolidated statement of income related to these changes in the third quarter of 2018 . Indiana Transport, Inc. (“Indiana Transport”) In November 2017, the Company acquired the business and certain assets of Elkhart, Indiana-based Indiana Transport, a transportation and logistics service provider primarily to OEMs and dealers in the RV market, for a net purchase price of $58.8 million . The results of operations for Indiana Transport are included in the Company’s condensed consolidated financial statements and the Distribution operating segment from the date of acquisition. The preliminary purchase price allocation is subject to final review and approval, and thus all required purchase accounting adjustments are subject to change within the measurement period as the Company finalizes its fair value estimates. In the first nine months of 2018, changes from previously reported estimated amounts as of December 31, 2017 include a $1.0 million decrease to property, plant and equipment, net, with a corresponding $1.0 million increase to goodwill, and a $0.6 million increase to accounts payable and accrued liabilities. LMI, Inc. and Related Companies (collectively, “LMI”) In November 2017, the Company acquired LMI, a designer, fabricator, and installer of specialty glass, mirror, bath and closet building products to residential housing and commercial high-rise builders, general contractors, retailers, and RV manufacturers in the U.S., for a net purchase price of $80.9 million . LMI is headquartered in Ontario, California and operates six manufacturing and distribution centers in California and Nevada and an additional manufacturing facility in China. The results of operations for LMI are included in the Company’s condensed consolidated financial statements and the Manufacturing operating segment from the date of acquisition. The preliminary purchase price allocation is subject to final review and approval, and thus all required purchase accounting adjustments are subject to change within the measurement period as the Company finalizes its fair value estimates. In the first nine months of 2018, changes from previously reported estimated amounts as of December 31, 2017 include a $2.0 million increase to property, plant and equipment, net, and a $0.6 million decrease to goodwill. Nickell Moulding Company, Inc. (“Nickell”) In December 2017, the Company acquired the business and certain assets of Elkhart, Indiana-based Nickell, a manufacturer of hardwood and wrapped mouldings and trim, custom wood frames, and door components for the RV, retail and hospitality, MH, and other markets, for a net purchase price of $12.6 million . The results of operations for Nickell are included in the Company’s condensed consolidated financial statements and the Manufacturing operating segment from the date of acquisition. The preliminary purchase price allocation is subject to final review and approval, and thus all required purchase accounting adjustments are subject to change within the measurement period as the Company finalizes its fair value estimates. In the first nine months of 2018, changes from previously reported estimated amounts as of December 31, 2017 include a $0.2 million decrease to trade receivables, a $0.8 million decrease to goodwill, a $0.4 million increase to inventories, a $0.3 million increase to property, plant and equipment, net, and a $0.6 million decrease to accounts payable and accrued liabilities. The following table summarizes the fair values of the assets acquired and the liabilities assumed as of the date of the acquisition. The purchase price allocation in each acquisition is final except as noted in the discussions above: (thousands) Trade receivables Inventories Property, plant and equipment Prepaid expenses & other Intangible assets Goodwill Less: Accounts payable and accrued liabilities Less: Deferred tax liability Total net assets acquired 2018 MMC (1) $ 1,474 $ 2,324 $ 3,000 $ — $ 10,626 $ 4,647 $ 818 $ — $ 21,253 AMC 3,966 5,631 4,000 39 5,350 1,243 2,462 — 17,767 IMP (2) 1,962 4,286 1,306 13 17,997 3,821 2,886 — 26,499 Collins 2,854 9,922 1,125 5 22,000 6,662 2,561 — 40,007 Dehco 4,727 18,416 14,175 356 14,200 4,100 3,194 — 52,780 Dowco 4,136 4,498 5,910 1,869 34,379 10,340 4,198 — 56,934 MAC 3,081 6,867 8,000 1,558 32,733 18,448 4,109 8,373 58,205 EMC (3) 600 2,018 3,500 — 18,750 3,900 387 — 28,381 2018 Totals $ 22,800 $ 53,962 $ 41,016 $ 3,840 $ 156,035 $ 53,161 $ 20,615 $ 8,373 $ 301,826 2017 Medallion $ 2,233 $ 2,605 $ 1,713 $ 118 $ 3,100 $ 1,342 $ 1,200 $ — $ 9,911 LPE 5,848 5,162 9,225 337 33,275 39,945 6,358 14,140 73,294 Wire Design 615 437 555 21 5,590 4,052 491 — 10,779 Baymont (4) — 1,174 2,067 — 3,166 1,502 69 — 7,840 Indiana Transport 6,379 — 2,594 1,309 31,375 20,250 3,117 — 58,790 LMI 11,222 9,086 6,028 994 36,110 25,910 8,472 — 80,878 Nickell 1,762 1,550 1,240 — 6,179 2,421 556 — 12,596 Other — 250 2,668 — — 668 124 — 3,462 2017 Totals $ 28,059 $ 20,264 $ 26,090 $ 2,779 $ 118,795 $ 96,090 $ 20,387 $ 14,140 $ 257,550 (1) Total net assets acquired for MMC reflect the preliminary estimated liability of $1.4 million pertaining to the fair value of the contingent consideration based on future performance. The actual net cash paid for the MMC acquisition of $19.9 million is included in “ Cash Flows from Investing Activities - Business Acquisitions ” on the condensed consolidated statement of cash flows for the nine months ended September 30, 2018. (2) Total net assets acquired for IMP reflect the preliminary estimated liability of $7.9 million pertaining to the fair value of the contingent consideration based on future performance. The actual net cash paid for the IMP acquisition of $18.6 million is included in “ Cash Flows from Investing Activities - Business Acquisitions ” on the condensed consolidated statement of cash flows for the nine months ended September 30, 2018. (3) Total net assets acquired for EMC reflect the preliminary estimated liability of $2.5 million pertaining to the fair value of the contingent consideration based on future performance. The actual net cash paid for the EMC acquisition of $25.9 million is included in “ Cash Flows from Investing Activities - Business Acquisitions ” on the condensed consolidated statement of cash flows for the nine months ended September 30, 2018. (4) Total net assets acquired for Baymont reflect the preliminary estimated liability of $4.0 million pertaining to the fair value of the contingent consideration based on future performance. The actual net cash paid for the Baymont acquisition of $3.8 million is included in “ Cash Flows from Investing Activities - Business Acquisitions ” on the consolidated statement of cash flows for the year ended December 31, 2017. Pro Forma Information The following pro forma information for the third quarter and nine months ended September 30, 2018 and September 24, 2017 assumes the MMC , AMC , IMP , Collins , Dehco, Dowco, MAC, and EMC acquisitions (which were acquired in 2018) and the Medallion , LPE , Wire Design , Baymont , Indiana Transport , LMI , and Nickell acquisitions (which were acquired in 2017) occurred as of the beginning of the year immediately preceding each such acquisition. The pro forma information contains the actual operating results of the 2018 and 2017 acquisitions combined with the results prior to their respective acquisition dates, adjusted to reflect the pro forma impact of the acquisitions occurring as of the beginning of the year immediately preceding each such acquisition. The pro forma information includes financing and interest expense charges based on the actual incremental borrowings incurred in connection with each transaction as if it occurred as of the beginning of the year immediately preceding each such acquisition. In addition, the pro forma information includes amortization expense, in the aggregate, related to intangible assets acquired in connection with the transactions of $0.4 million and $5.4 million for the third quarter and nine months ended September 30, 2018 , respectively, and $5.2 million and $18.1 million for the third quarter and nine months ended September 24, 2017 , respectively. Third Quarter Ended Nine Months Ended (thousands except per share data) September 30, 2018 September 24, 2017 September 30, 2018 September 24, 2017 Revenue $ 579,432 $ 544,709 $ 1,846,631 $ 1,591,758 Net income 28,393 23,134 99,652 75,832 Basic net income per common share 1.19 0.94 4.10 3.16 Diluted net income per common share 1.17 0.92 4.05 3.11 The pro forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that actually would have been achieved had the acquisitions been consummated as of that time, nor is it intended to be a projection of future results. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 9 Months Ended |
Sep. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCK-BASED COMPENSATION | 7. STOCK-BASED COMPENSATION The Company accounts for stock-based compensation in accordance with fair value recognition provisions. The Company recorded compensation expense of $3.5 million and $2.6 million for the third quarters ended September 30, 2018 and September 24, 2017 , respectively, for its stock-based compensation plans on the condensed consolidated statements of income. For the first nine months of 2018 and 2017, the Company recorded $10.9 million and $7.8 million , respectively. The Company estimates the fair value of (i) all stock grants as of the grant date using the closing price per share of the Company’s common stock on such date, and (ii) all stock option and stock appreciation rights awards as of the grant date by applying the Black-Scholes option pricing model. For full year 2017, the Board of Directors (the “Board”) approved various share grants under the Company’s 2009 Omnibus Incentive Plan (the “Plan”) totaling 233,654 shares in the aggregate, of which grants of 167,504 shares were approved in the first nine months of 2017. On January 17, 2017, the Board approved the grant of 340,110 stock options and the grant of 340,128 stock appreciation rights. The Board approved various share grants under the Plan in the first nine months of 2018 totaling 181,808 shares in the aggregate. As of September 30, 2018 , there was approximately $24.2 million of total unrecognized compensation cost related to stock-based compensation arrangements granted under incentive plans. That cost is expected to be recognized over a weighted-average period of 21.1 months. |
NET INCOME PER COMMON SHARE
NET INCOME PER COMMON SHARE | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
NET INCOME PER COMMON SHARE | 8. NET INCOME PER COMMON SHARE Basic net income per common share is computed by dividing net income by the weighted-average number of common shares outstanding. Diluted net income per common share is computed by dividing net income by the weighted-average number of common shares outstanding, plus the dilutive effect of stock options, stock appreciation rights, and restricted stock units (collectively “Common Stock Equivalents”). The dilutive effect of Common Stock Equivalents is calculated under the treasury stock method using the average market price for the period. Certain Common Stock Equivalents were not included in the computation of diluted net income per common share because the exercise prices of those Common Stock Equivalents were greater than the average market price of the common shares. Income per common share is calculated for the third quarter and nine months periods as follows: Third Quarter Ended Nine Months Ended (thousands except per share data) September 30, 2018 September 24, 2017 September 30, 2018 September 24, 2017 Net income for basic and diluted per share calculation $ 27,934 $ 17,945 $ 92,862 $ 56,672 Weighted average common shares outstanding - basic 23,894 24,663 24,279 24,066 Effect of potentially dilutive securities 338 369 340 410 Weighted average common shares outstanding - diluted 24,232 25,032 24,619 24,476 Basic net income per common share $ 1.17 $ 0.73 $ 3.82 $ 2.35 Diluted net income per common share $ 1.15 $ 0.72 $ 3.77 $ 2.32 |
DEBT
DEBT | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
DEBT | 9. DEBT A summary of total debt outstanding at September 30, 2018 and December 31, 2017 is as follows: (thousands) September 30, 2018 December 31, 2017 Long-term debt: Revolver $ 364,000 $ 287,397 Term Loan 97,500 66,960 Convertible Notes 172,500 — Total long-term debt 634,000 354,357 Less: Convertible Notes debt discount (31,699 ) — Less: current maturities of long-term debt (7,500 ) (15,766 ) Less: net deferred financing costs related to Term Loan (467 ) (480 ) Total long-term debt, less current maturities, net $ 594,334 $ 338,111 2015 Credit Facility Prior to June 5, 2018, the Company's credit facility was established under its credit agreement, dated April 28, 2015, with Wells Fargo Bank, National Association (“Wells Fargo”), as Administrative Agent and a lender, and the lenders party thereto, as amended (the “2015 Credit Agreement”). The 2015 Credit Agreement consisted of a $417.3 million revolving credit loan (the “2015 Revolver”) and up to an $82.7 million term loan (the “2015 Term Loan” and, together with the Revolver, the “2015 Credit Facility”). The 2015 Credit Facility had a maturity date of March 17, 2022 and was replaced by the 2018 Credit Facility (as defined herein). 2018 Credit Facility The Company entered into a Second Amended and Restated Credit Agreement, dated as of June 5, 2018, (the “2018 Credit Agreement”) by and among the Company, the Lenders party thereto, and Wells Fargo, as Administrative Agent. The 2018 Credit Agreement amended and restated the Company’s 2015 Credit Agreement. The 2018 Credit Facility is comprised of an $800 million revolving credit loan (the “2018 Revolver”) and a $100 million term loan (the “2018 Term Loan” and, together with the 2018 Revolver, the “2018 Credit Facility”). The March 17, 2022 maturity date for borrowings under the 2018 Credit Agreement remained unchanged from the 2015 Credit Agreement. The 2018 Credit Agreement continues to be secured by substantially all personal property assets of the Company and any domestic subsidiary guarantors. The 2018 Credit Agreement includes certain definitions, terms and reporting requirements and includes the following additional provisions: • The 2018 Term Loan will be repaid in consecutive quarterly installments on the last business day of each of March, June, September and December in the following amounts: (i) beginning June 30, 2018, through and including March 31, 2019, $1,250,000 , (ii) beginning June 30, 2019, through and including March 31, 2021, $2,500,000 , and (iii) beginning June 30, 2021, and each quarter thereafter, $3,750,000 , with the remaining balance due at maturity; • The interest rates for borrowings under the 2018 Revolver and the 2018 Term Loan are the Base Rate plus the Applicable Margin or LIBOR plus the Applicable Margin, with a fee payable by the Company on unused but committed portions of the Revolver; • The 2018 Revolver includes a sub-limit up to $10.0 million for same day advances (“Swing Line”) which shall bear interest based upon the Base Rate plus the Applicable Margin; • Up to $10.0 million of the 2018 Revolver is available as a sub facility for the issuance of standby letters of credit, which are subject to certain expiration dates; • The financial covenants include requirements as to a consolidated total leverage ratio and a consolidated fixed charge coverage ratio, and other covenants include limitations and restrictions concerning permitted acquisitions, investments, sales of assets, liens on assets, dividends and other payments; and • Customary prepayment provisions, representations, warranties and covenants, and events of default. At September 30, 2018 , the Company had $97.5 million outstanding under the 2018 Term Loan under the LIBOR-based option, and borrowings outstanding under the 2018 Revolver of: (i) $348.0 million under the LIBOR-based option and (ii) $16.0 million under the Base Rate-based option. The interest rate for borrowings at September 30, 2018 was the Prime Rate plus 1.00% (or 6.25% ), or LIBOR plus 2.00% (or 4.26% ). At December 31, 2017 , the Company had $67.0 million outstanding under the 2015 Term Loan under the LIBOR-based option, and borrowings outstanding under the 2015 Revolver of: (i) $281.0 million under the LIBOR-based option and (ii) $6.4 million under the Base Rate-based option. The interest rate for borrowings at December 31, 2017 was the Prime Rate plus 0.50% (or 5.00% ), or LIBOR plus 1.50% (or 3.1250% ). The fee payable on committed but unused portions of the 2018 Revolver and the 2015 Revolver, respectively, was 0.25% at September 30, 2018 and 0.20% December 31, 2017 . Pursuant to the 2018 Credit Agreement, the financial covenants include: (a) a required maximum consolidated total leverage ratio, measured on a quarter-end basis, not to exceed 3.00 : 1.00 for the 12 -month period ending on such quarter-end; and (b) a required minimum consolidated fixed charge coverage ratio, measured on a quarter-end basis, of at least 1.50 : 1.00 for the 12 -month period ending on such quarter-end. The consolidated total leverage ratio is the ratio for any period of consolidated total indebtedness (as measured as of the second day following the end of the immediately preceding fiscal quarter) to consolidated adjusted earnings before interest, taxes, depreciation and amortization (“EBITDA”). Consolidated total indebtedness for any period is the sum of: (i) total debt outstanding under the 2018 Revolver, the 2018 Term Loan and the Convertible Notes (as defined herein); (ii) capital leases and letters of credit outstanding; and (iii) deferred payment obligations. The consolidated fixed charge coverage ratio for any period is the ratio of consolidated EBITDA less restricted payments, taxes paid and capital expenditures as defined under the 2018 Credit Agreement to consolidated fixed charges. Consolidated fixed charges for any period is the sum of cash interest expense related to the 2018 Term Loan, 2018 Revolver and the Convertibles Notes, and scheduled principal payments on outstanding indebtedness under the 2018 Term Loan. As of and for the September 30, 2018 reporting date, the Company was in compliance with both of these financial debt covenants as required under the terms of the 2018 Credit Agreement. The required maximum consolidated total leverage ratio and the required minimum consolidated fixed charge coverage ratio compared to the actual amounts as of September 30, 2018 and for the fiscal period then ended are as follows: Required Actual Consolidated total leverage ratio (12-month period) 3.00 2.26 Consolidated fixed charge coverage ratio (12-month period) 1.50 3.51 Total cash interest paid for the third quarter and first nine months of 2018 was $6.6 million and $12.2 million , respectively. For the comparable 2017 periods, cash interest paid was $2.3 million and $5.8 million , respectively. Interest Rate Swaps In the third quarter of 2018, the Company entered into $200.0 million notional amount of variable to fixed interest rate swaps to hedge risks associated with the variable LIBOR component of the 2018 Credit Facility. These interest rate swaps fix the LIBOR component of interest expense on $200.0 million of the debt outstanding under the 2018 Credit Facility at an average interest rate of 2.91% , with an all-in average rate of 4.91% with the current applicable margin, discussed above. See Note 10 for further details. Convertible Senior Notes In January 2018, the Company issued $172.5 million aggregate principal amount of 1.00% Convertible Senior Notes due 2023 (the “Convertible Notes”). The total debt discount at closing of $36.0 million represented (1) the difference between the principal amount of the Convertible Notes upon issuance less the present value of the future cash flows of the Convertible Notes or $31.9 million plus (2) the debt discount portion of the issuance costs of $4.1 million . The unamortized portion of the total debt discount is being amortized to interest expense over the life of the Convertible Notes beginning in the first quarter of 2018. The unamortized portion of the debt discount as of September 30, 2018 was $31.7 million . The net proceeds from the issuance of the Convertible Notes were approximately $167.5 million , after deducting the initial purchasers’ discounts and commissions and offering expenses payable by the Company, but before deducting the net cost of the Convertible Note Hedge Transactions and the Warrant Transactions (each as defined herein) described in Note 10. The Convertible Notes are senior unsecured obligations of the Company and pay interest semi-annually in arrears on February 1 and August 1 of each year at an annual rate of 1.00% beginning August 1, 2018. The Convertible Notes will mature on February 1, 2023 unless earlier repurchased or converted in accordance with their terms. The Convertible Notes are convertible by the noteholders, in certain circumstances and subject to certain conditions, into cash, shares of common stock of the Company, or a combination thereof, at the Company’s election. The initial conversion rate for the Convertible Notes is 11.3785 shares of the Company's common stock per $1,000 principal amount of the Convertible Notes (or 1,962,790 shares in the aggregate) and is equal to an initial conversion price of approximately $87.89 per share. If an event of default on the Convertible Notes occurs, the principal amount of the Convertible Notes, plus accrued and unpaid interest (including additional interest, if any) may be declared immediately due and payable, subject to certain conditions. The net proceeds were used to pay the net cost of the Convertible Hedge Transactions and the Warrant Transactions and to reduce borrowings under the 2015 Revolver. |
DERIVATIVE FINANCIAL INSTRUMENT
DERIVATIVE FINANCIAL INSTRUMENTS | 9 Months Ended |
Sep. 30, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE FINANCIAL INSTRUMENTS | 10. DERIVATIVE FINANCIAL INSTRUMENTS Convertible Note Hedge Transactions and Warrant Transactions In January 2018, in connection with the Convertible Notes offering, the Company entered into privately negotiated convertible note hedge transactions (together, the “Convertible Note Hedge Transactions”) with each of Bank of America, N.A. and Wells Fargo Bank, National Association (together, the “Hedge Counterparties”). Pursuant to the Convertible Note Hedge Transactions, the Company acquired options to purchase the same number of shares of the Company's common stock (or 1,962,790 shares) initially underlying the Convertibles Notes at an initial strike price equal to the initial strike price of the Convertible Notes of approximately $87.89 per share, subject to customary anti-dilution adjustments. The options expire on February 1, 2023, subject to earlier exercise. At the same time, the Company also entered into separate, privately negotiated warrant transactions (the “Warrant Transactions”) with each of the Hedge Counterparties, pursuant to which the Company sold warrants to purchase the same number of shares of the Company’s common stock (or 1,962,790 shares) underlying the Convertible Notes, at an initial strike price of approximately $113.93 per share, subject to customary anti-dilution adjustments. The warrants have a final expiration date of September 20, 2023. The Company paid $31.5 million associated with the cost of the Convertible Note Hedge Transactions and received proceeds of $18.1 million related to the Warrant Transactions. The Convertible Note Hedge Transactions are expected generally to reduce potential dilution to the Company’s common stock upon any conversion of the Convertible Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of converted Convertible Notes. However, the Warrant Transactions, could separately have a dilutive effect on the Company's common stock to the extent that the market price per share of the common stock exceeds the strike price of the warrants. Interest Rate Swaps The 2018 Credit Facility exposes the Company to risk associated with the variability in interest expense associated with fluctuations in LIBOR. To partially mitigate this risk, the Company entered into interest rate swaps on a portion of its 2018 Credit Facility. As of September 30, 2018, the Company had a combined notional principal amount of $200.0 million of variable to fixed interest rate swap agreements, all of which were designated as cash flow hedges. These swap agreements effectively convert the interest expense associated with a portion of the 2018 Credit Facility from variable interest rates to fixed interest rates and have termination dates that correspond to the interest payment dates of the 2018 Credit Facility. Fair Value of Derivative Contracts The following table summarizes the fair value of derivative contracts included in the accompanying condensed consolidated balance sheet (in thousands): Fair value of derivative assets Fair value of derivative liabilities Derivatives accounted for as cash flow hedges Balance sheet location September 30, 2018 December 31, 2017 Balance sheet location September 30, 2018 December 31, 2017 Interest rate swap agreements Other non-current assets $ 194 $ — Other long-term liabilities $ 86 $ — The interest rate swaps are comprised of over-the-counter derivatives, which are valued using models that primarily rely on observable inputs such as yield curves, and are classified as Level 2 in the fair value hierarchy. AOCI Recognition The following table presents the amount of gains and losses that have been recognized in accumulated other comprehensive ("AOCI") from changes in the unrealized gain on the interest rate swaps, net of tax (in thousands): Unrealized Gain Recognized in AOCI Third Quarter Ended Nine Months Ended September 30, 2018 September 24, 2017 September 30, 2018 September 24, 2017 $ 80 $ — $ 80 $ — |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE INCOME | 9 Months Ended |
Sep. 30, 2018 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income | 11. ACCUMULATED OTHER COMPREHENSIVE INCOME The Company incurs activity in AOCI for unrealized gains on derivatives that qualify as hedges of cash flows, unrecognized pension costs and cumulative foreign currency translation adjustments. The activity in AOCI is as follows: (thousands) Cash Flow Hedges Defined Benefit Pension Foreign Currency Items Total Balance at December 31, 2017 $ — $ 66 $ — $ 66 Other comprehensive income (loss) (net of tax of $28, $0 and $0) 80 — (31 ) 49 Balance at September 30, 2018 $ 80 $ 66 $ (31 ) $ 115 |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | 12. FAIR VALUE MEASUREMENTS The carrying amounts of cash and cash equivalents, trade receivables, and accounts payable approximated fair value as of September 30, 2018 and December 31, 2017 because of the relatively short maturities of these financial instruments. The carrying amounts of the 2018 Term Loan and the 2018 Revolver and of the 2015 Term Loan and the 2015 Revolver, approximated fair value as of September 30, 2018 and December 31, 2017 , respectively, based upon terms and conditions available to the Company at those dates in comparison to the terms and conditions of its outstanding debt. The estimated fair value of the Convertible Notes, calculated using Level 2 inputs, was approximately $164.4 million as of September 30, 2018. |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | 13. INCOME TAXES The effective tax rate in the third quarter of 2018 and 2017 was 25.3% and 36.0% , respectively, and the effective tax rate for the comparable nine months periods was 23.6% and 30.6% , respectively. The effective tax rate for the periods presented includes the impact of the recognition of excess tax benefits on share-based compensation that was recorded as a reduction to income tax expense upon realization. Amounts recorded include $21,000 in the third quarter of 2017 with no comparable amount in the third quarter of 2018, and $2.2 million and $4.6 million for the first nine months of 2018 and 2017, respectively. The Company paid income taxes of $5.6 million and $ 11.0 million in the third quarter of 2018 and 2017 , respectively, and $21.0 million and $30.5 million in the first nine months of 2018 and 2017 , respectively. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 9 Months Ended |
Sep. 30, 2018 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | 14. SEGMENT INFORMATION The Company has determined that its reportable segments are those based on its method of internal reporting, which segregates its businesses by product category and production/distribution process. A description of the Company’s reportable segments is as follows: Manufacturing – This segment includes the following: laminated products that are utilized to produce furniture, shelving, walls, countertops, and cabinet products, cabinet doors, fiberglass bath fixtures and tile systems, hardwood furniture, vinyl printing, solid surface, granite, and quartz countertop fabrication, RV painting, fabricated aluminum products, fiberglass and plastic components, softwoods lumber, custom cabinetry, polymer-based flooring, electrical systems components including instrument and dash panels, and other products. Patrick’s major manufactured products also include wrapped vinyl, paper and hardwood profile mouldings, interior passage doors, slide-out trim and fascia, thermoformed shower surrounds, specialty bath and closet building products, fiberglass and plastic helm systems and components products, wiring and wire harnesses, boat covers, towers, tops and frames, aluminum fuel tanks, CNC molds and composite parts, and slotwall panels and components. The Manufacturing segment contributed approximately 78% and 83% of the Company’s net sales for the first nine months ended September 30, 2018 and September 24, 2017 , respectively. Distribution – The Company distributes pre-finished wall and ceiling panels, drywall and drywall finishing products, electronics and audio systems components, wiring, electrical and plumbing products, appliances, fiber reinforced polyester products, cement siding, raw and processed lumber, interior passage doors, roofing products, laminate and ceramic flooring, shower doors, furniture, fireplaces and surrounds, interior and exterior lighting products, and other miscellaneous products, in addition to providing transportation and logistics services. The Distribution segment contributed approximately 22% and 17% of the Company’s net sales for the first nine months ended September 30, 2018 and September 24, 2017 , respectively. The tables below present unaudited information about the sales and operating income of those segments. Third Quarter Ended September 30, 2018 (thousands) Manufacturing Distribution Total Net outside sales $ 445,214 $ 129,925 $ 575,139 Intersegment sales 8,182 1,097 9,279 Total sales 453,396 131,022 584,418 Operating income 54,887 7,606 62,493 Third Quarter Ended September 24, 2017 (thousands) Manufacturing Distribution Total Net outside sales $ 337,542 $ 69,969 $ 407,511 Intersegment sales 7,530 562 8,092 Total sales 345,072 70,531 415,603 Operating income 37,916 4,198 42,114 Nine Months Ended September 30, 2018 (thousands) Manufacturing Distribution Total Net outside sales $ 1,344,088 $ 387,762 $ 1,731,850 Intersegment sales 27,464 2,840 30,304 Total sales 1,371,552 390,602 1,762,154 Operating income 172,799 25,092 197,891 Nine Months Ended September 24, 2017 (thousands) Manufacturing Distribution Total Net outside sales $ 958,785 $ 201,298 $ 1,160,083 Intersegment sales 21,935 1,814 23,749 Total sales 980,720 203,112 1,183,832 Operating income 110,176 12,376 122,552 The following table presents a reconciliation of segment operating income to consolidated operating income: Third Quarter Ended Nine Months Ended (thousands) September 30, 2018 September 24, 2017 September 30, 2018 September 24, 2017 Operating income for reportable segments $ 62,493 $ 42,114 $ 197,891 $ 122,552 Unallocated corporate expenses (8,911 ) (6,703 ) (33,229 ) (20,517 ) Amortization (8,873 ) (5,237 ) (25,140 ) (14,239 ) Consolidated operating income $ 44,709 $ 30,174 $ 139,522 $ 87,796 Unallocated corporate expenses include corporate general and administrative expenses comprised of wages, insurance, taxes, supplies, travel and entertainment, professional fees and other. |
STOCK REPURCHASE PROGRAMS
STOCK REPURCHASE PROGRAMS | 9 Months Ended |
Sep. 30, 2018 | |
Equity [Abstract] | |
STOCK REPURCHASE PROGRAM | 15. STOCK REPURCHASE PROGRAMS In January 2018, the Board approved a new stock repurchase program that authorized the repurchase of up to $50.0 million of the Company's common stock over a 24 -month period (the “2018 Repurchase Plan”) to replace the repurchase plan the Board previously approved in January 2016 that had expired in January 2018. In May 2018, the Board approved an increase in the amount of the Company's common stock that may be acquired over the next 24 months under the current stock repurchase program to $50.0 million , which included the $8.5 million remaining under the original $50.0 million authorization announced in January 2018. In the first nine months of 2018, the Company repurchased 1,282,930 shares under the 2018 Repurchase Plan at an average price of $58.48 per share for a total cost of $75.0 million . In October 2018, the Board approved an increase in the amount of the Company's common stock that may be acquired over the next 24 months under the current stock repurchase program to $50.0 million , which included the $3.6 million remaining under the $50.0 million authorization announced in May 2018. Year-to-date through November 7, 2018, the Company repurchased 1,796,484 shares at an average price of $56.12 per share for a total cost of $100.8 million . Common Stock The Company’s common stock does not have a stated par value. As a result, repurchases of common stock have been reflected, using an average cost method, as a reduction of common stock, additional paid-in-capital, and retained earnings on the Company’s condensed consolidated statements of financial position. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Sep. 30, 2018 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | 16. RELATED PARTY TRANSACTIONS In the first nine months of 2018 , the Company entered into transactions with companies affiliated with two of its independent Board members. The Company purchased approximately $0.9 million of corrugated packaging materials from Welch Packaging Group, an independently owned company established by M. Scott Welch who serves as its President and CEO. The Company also sold approximately $0.5 million of RV component products to DNA Enterprises, Inc. ("DNA"). Walter E. Wells' son serves as the President of DNA. |
RECENTLY ISSUED ACCOUNTING PR_2
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Recent Issued Accounting Pronouncements | Leases In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, " Leases (Topic 842) ", which requires that an entity recognize lease assets and lease liabilities on its statement of financial position for leases in excess of one year that were previously classified as operating leases under U.S. GAAP. The standard also requires companies to disclose in the footnotes to the financial statements information about the amount, timing, and uncertainty for the payments made for the lease agreements. The standard is effective for financial statements issued for annual and interim periods beginning after December 15, 2018 on a retroactive basis. Early adoption is permitted. In July 2018, the FASB issued ASU 2018-11, " Leases (Topic 842): Targeted Improvements ", which offers practical expedient alternatives to the retroactive adoption of Accounting Standards Codification (“ASC”) 842. Specifically, the practical expedients allow companies to recognize right of use lease assets and lease liabilities at the date of adoption only, rather than retrospectively for all periods presented, as well as practical expedients related to the presentation of lease components. The Company anticipates it will utilize the practical expedients under ASU 2018-11, and as a result, will reflect the adoption of ASC 842 in its condensed consolidated statement of financial position as of January 1, 2019, and will not retroactively reflect the provisions of ASC 842 in its 2017 and 2018 comparative statements of financial position. In 2017, the Company established an implementation team to develop a plan to assess changes to processes and systems necessary to adopt the new standard. The implementation team has completed its technical assessment of assumptions and methods to be used in adopting the standard, and is currently working with a third party lease administrator in finalizing data extraction of lease information to a third party lease accounting system, with the expectation to complete data extraction procedures in late December 2018. The adoption of this new accounting standard is expected to have a material impact on the reporting of lease assets and lease liabilities on the condensed consolidated statements of financial position and is not expected to have a material impact on the condensed consolidated statements of financial position as a whole or on the results of operations or cash flows. Stock Compensation In May 2017, the FASB issued a new accounting standard that provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting related to changes to such awards. The updated guidance is effective for interim and annual periods beginning after December 15, 2017 and early adoption is permitted. The Company adopted this new standard as of January 1, 2018 as required, and since it does not have a history of modifying share-based payment awards, has determined that the updated requirements did not have an impact on its condensed consolidated financial statements for the periods presented. Cash Flow Statement Classifications In August 2016, the FASB issued a new accounting standard related to the classification of certain cash receipts and cash payments in the statement of cash flows. This standard is effective for financial statements issued for annual and interim periods beginning after December 15, 2017. The standard may be applied on a retrospective basis and early adoption is permitted. The Company adopted the new standard as of January 1, 2018 as required and has determined that its implementation did not have a material impact on its condensed consolidated statements of cash flows for the periods presented. Goodwill Impairment In January 2017, the FASB issued a new accounting standard that simplifies the accounting for goodwill impairments by eliminating step two from the goodwill impairment test. The standard requires that the impairment loss be measured as the excess of the reporting unit's carrying amount over its fair value. It eliminates the second step that requires the impairment to be measured between the implied value of a reporting unit's goodwill and its carrying value. The standard is effective for annual and any interim impairment tests for periods beginning after December 15, 2019 and early adoption is permitted. The Company is currently evaluating the effect of adopting this new accounting standard and has not yet determined the impact that its implementation will have on its condensed consolidated financial statements. Definition of a Business In January 2017, the FASB issued a new accounting standard that clarifies the definition of a business with the objective of adding guidance to assist companies with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The standard is effective for financial statements issued for annual and interim periods beginning after December 15, 2017 and may be applied on a retrospective basis with early adoption permitted. The Company adopted this new standard as of January 1, 2018 as required and determined that its implementation did not have a material impact on the Company's condensed consolidated financial statements for the periods presented. Hedging Activities In August 2017, the FASB issued ASU 2017-12, " Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities ", which is codified in ASC 815. The ASU is effective for financial statements issued for annual and interim periods beginning after December 15, 2018 and early adoption is permitted. This ASU makes a number of targeted amendments that will enable entities to more clearly portray the economics of their risk management activities in the financial statements and simplify the application of hedge accounting in certain situations. The Company adopted ASU 2017-12 in August 2018 in anticipation of derivative swap arrangements which were entered into in the third quarter of 2018 and determined that its implementation did not have a material impact on the Company's condensed consolidated financial statements for the periods presented. See Notes 9 and 10 for additional information. |
REVENUE RECOGNITION (Tables)
REVENUE RECOGNITION (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | In the following table, revenue from contracts with customers, net of intersegment sales, is disaggregated by market type and by reportable operating segments: Third Quarter Ended September 30, 2018 (thousands) Manufacturing Distribution Total Reportable Operating Segments Market type: Recreational Vehicle $ 262,936 $ 91,637 $ 354,573 Manufactured Housing 41,428 26,334 67,762 Industrial 63,429 8,906 72,335 Marine 77,421 3,048 80,469 Total $ 445,214 $ 129,925 $ 575,139 Nine Months Ended September 30, 2018 (thousands) Manufacturing Distribution Total Reportable Operating Segments Market type: Recreational Vehicle $ 847,944 $ 280,082 $ 1,128,026 Manufactured Housing 124,406 75,946 200,352 Industrial 186,890 25,701 212,591 Marine 184,848 6,033 190,881 Total $ 1,344,088 $ 387,762 $ 1,731,850 ` |
Schedule of Contract Assets and Liabilities | The following table provides information about contract balances: (thousands) September 30, 2018 At Adoption Receivables, which are included in trade receivables, net $ 126,613 $ 75,926 Contract liabilities 2,523 1,310 Significant changes in the contract liabilities balance during the nine months ended September 30, 2018 are as follows: (thousands) Contract Liabilities Revenue recognized that was included in the contract liability balance at the beginning of the period $(1,165) Increases due to cash received, excluding amounts recognized as revenue during the period 2,190 Accrued customer deposits related to business combinations 188 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventories are stated at the lower of cost (First-In, First-Out (FIFO) Method) and net realizable value and consist of the following classes: (thousands) September 30, 2018 December 31, 2017 Raw materials $ 128,897 $ 96,846 Work in process 13,898 10,720 Finished goods 24,439 22,936 Less: reserve for inventory obsolescence (4,014 ) (3,087 ) Total manufactured goods, net 163,220 127,415 Materials purchased for resale (distribution products) 81,621 49,392 Less: reserve for inventory obsolescence (2,385 ) (1,537 ) Total materials purchased for resale (distribution products), net 79,236 47,855 Total inventories $ 242,456 $ 175,270 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill | Changes in the carrying amount of goodwill for the nine months ended September 30, 2018 by segment are as follows: (thousands) Manufacturing Distribution Total Balance - December 31, 2017 $ 179,471 $ 28,573 $ 208,044 Acquisitions 40,144 13,017 53,161 Adjustment to prior year preliminary purchase price allocation (4,070 ) 978 (3,092 ) Balance - September 30, 2018 $ 215,545 $ 42,568 $ 258,113 |
Schedule of intangible assets, net | Intangible assets, net consist of the following as of September 30, 2018 and December 31, 2017 : (thousands) September 30, 2018 Weighted Average Useful Life December 31, 2017 Weighted Average Useful Life Customer relationships $ 369,339 10.1 $ 239,053 10.2 Non-compete agreements 21,566 4.7 15,564 4.2 Trademarks 82,250 Indefinite 60,448 Indefinite 473,155 315,065 Less: accumulated amortization (76,738 ) (51,598 ) Intangible assets, net $ 396,417 $ 263,467 |
Schedule of changes in intangible assets | Changes in the carrying value of intangible assets for the nine months ended September 30, 2018 by segment are as follows: (thousands) Manufacturing Distribution Total Balance - December 31, 2017 $ 220,540 $ 42,927 $ 263,467 Acquisitions 117,012 39,023 156,035 Amortization (20,207 ) (4,933 ) (25,140 ) Adjustment to prior year preliminary purchase price allocation 2,070 (15 ) 2,055 Balance - September 30, 2018 $ 319,415 $ 77,002 $ 396,417 |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Business Combinations [Abstract] | |
Schedule of assets acquired and liabilities assumed | The purchase price allocation in each acquisition is final except as noted in the discussions above: (thousands) Trade receivables Inventories Property, plant and equipment Prepaid expenses & other Intangible assets Goodwill Less: Accounts payable and accrued liabilities Less: Deferred tax liability Total net assets acquired 2018 MMC (1) $ 1,474 $ 2,324 $ 3,000 $ — $ 10,626 $ 4,647 $ 818 $ — $ 21,253 AMC 3,966 5,631 4,000 39 5,350 1,243 2,462 — 17,767 IMP (2) 1,962 4,286 1,306 13 17,997 3,821 2,886 — 26,499 Collins 2,854 9,922 1,125 5 22,000 6,662 2,561 — 40,007 Dehco 4,727 18,416 14,175 356 14,200 4,100 3,194 — 52,780 Dowco 4,136 4,498 5,910 1,869 34,379 10,340 4,198 — 56,934 MAC 3,081 6,867 8,000 1,558 32,733 18,448 4,109 8,373 58,205 EMC (3) 600 2,018 3,500 — 18,750 3,900 387 — 28,381 2018 Totals $ 22,800 $ 53,962 $ 41,016 $ 3,840 $ 156,035 $ 53,161 $ 20,615 $ 8,373 $ 301,826 2017 Medallion $ 2,233 $ 2,605 $ 1,713 $ 118 $ 3,100 $ 1,342 $ 1,200 $ — $ 9,911 LPE 5,848 5,162 9,225 337 33,275 39,945 6,358 14,140 73,294 Wire Design 615 437 555 21 5,590 4,052 491 — 10,779 Baymont (4) — 1,174 2,067 — 3,166 1,502 69 — 7,840 Indiana Transport 6,379 — 2,594 1,309 31,375 20,250 3,117 — 58,790 LMI 11,222 9,086 6,028 994 36,110 25,910 8,472 — 80,878 Nickell 1,762 1,550 1,240 — 6,179 2,421 556 — 12,596 Other — 250 2,668 — — 668 124 — 3,462 2017 Totals $ 28,059 $ 20,264 $ 26,090 $ 2,779 $ 118,795 $ 96,090 $ 20,387 $ 14,140 $ 257,550 (1) Total net assets acquired for MMC reflect the preliminary estimated liability of $1.4 million pertaining to the fair value of the contingent consideration based on future performance. The actual net cash paid for the MMC acquisition of $19.9 million is included in “ Cash Flows from Investing Activities - Business Acquisitions ” on the condensed consolidated statement of cash flows for the nine months ended September 30, 2018. (2) Total net assets acquired for IMP reflect the preliminary estimated liability of $7.9 million pertaining to the fair value of the contingent consideration based on future performance. The actual net cash paid for the IMP acquisition of $18.6 million is included in “ Cash Flows from Investing Activities - Business Acquisitions ” on the condensed consolidated statement of cash flows for the nine months ended September 30, 2018. (3) Total net assets acquired for EMC reflect the preliminary estimated liability of $2.5 million pertaining to the fair value of the contingent consideration based on future performance. The actual net cash paid for the EMC acquisition of $25.9 million is included in “ Cash Flows from Investing Activities - Business Acquisitions ” on the condensed consolidated statement of cash flows for the nine months ended September 30, 2018. (4) Total net assets acquired for Baymont reflect the preliminary estimated liability of $4.0 million pertaining to the fair value of the contingent consideration based on future performance. The actual net cash paid for the Baymont acquisition of $3.8 million is included in “ Cash Flows from Investing Activities - Business Acquisitions ” on the consolidated statement of cash flows for the year ended December 31, 2017. |
Schedule of pro forma information | Third Quarter Ended Nine Months Ended (thousands except per share data) September 30, 2018 September 24, 2017 September 30, 2018 September 24, 2017 Revenue $ 579,432 $ 544,709 $ 1,846,631 $ 1,591,758 Net income 28,393 23,134 99,652 75,832 Basic net income per common share 1.19 0.94 4.10 3.16 Diluted net income per common share 1.17 0.92 4.05 3.11 |
NET INCOME PER COMMON SHARE (Ta
NET INCOME PER COMMON SHARE (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of earnings per share | Income per common share is calculated for the third quarter and nine months periods as follows: Third Quarter Ended Nine Months Ended (thousands except per share data) September 30, 2018 September 24, 2017 September 30, 2018 September 24, 2017 Net income for basic and diluted per share calculation $ 27,934 $ 17,945 $ 92,862 $ 56,672 Weighted average common shares outstanding - basic 23,894 24,663 24,279 24,066 Effect of potentially dilutive securities 338 369 340 410 Weighted average common shares outstanding - diluted 24,232 25,032 24,619 24,476 Basic net income per common share $ 1.17 $ 0.73 $ 3.82 $ 2.35 Diluted net income per common share $ 1.15 $ 0.72 $ 3.77 $ 2.32 |
DEBT (Tables)
DEBT (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of total debt outstanding | A summary of total debt outstanding at September 30, 2018 and December 31, 2017 is as follows: (thousands) September 30, 2018 December 31, 2017 Long-term debt: Revolver $ 364,000 $ 287,397 Term Loan 97,500 66,960 Convertible Notes 172,500 — Total long-term debt 634,000 354,357 Less: Convertible Notes debt discount (31,699 ) — Less: current maturities of long-term debt (7,500 ) (15,766 ) Less: net deferred financing costs related to Term Loan (467 ) (480 ) Total long-term debt, less current maturities, net $ 594,334 $ 338,111 |
Schedule of required financial covenants | As of and for the September 30, 2018 reporting date, the Company was in compliance with both of these financial debt covenants as required under the terms of the 2018 Credit Agreement. The required maximum consolidated total leverage ratio and the required minimum consolidated fixed charge coverage ratio compared to the actual amounts as of September 30, 2018 and for the fiscal period then ended are as follows: Required Actual Consolidated total leverage ratio (12-month period) 3.00 2.26 Consolidated fixed charge coverage ratio (12-month period) 1.50 3.51 |
DERIVATIVE FINANCIAL INSTRUME_2
DERIVATIVE FINANCIAL INSTRUMENTS (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Assets at Fair Value | The following table summarizes the fair value of derivative contracts included in the accompanying condensed consolidated balance sheet (in thousands): Fair value of derivative assets Fair value of derivative liabilities Derivatives accounted for as cash flow hedges Balance sheet location September 30, 2018 December 31, 2017 Balance sheet location September 30, 2018 December 31, 2017 Interest rate swap agreements Other non-current assets $ 194 $ — Other long-term liabilities $ 86 $ — |
Schedule of Derivative Liabilities at Fair Value | The following table summarizes the fair value of derivative contracts included in the accompanying condensed consolidated balance sheet (in thousands): Fair value of derivative assets Fair value of derivative liabilities Derivatives accounted for as cash flow hedges Balance sheet location September 30, 2018 December 31, 2017 Balance sheet location September 30, 2018 December 31, 2017 Interest rate swap agreements Other non-current assets $ 194 $ — Other long-term liabilities $ 86 $ — |
Schedule of Derivative Gains and Losses Recognized in AOCI | The following table presents the amount of gains and losses that have been recognized in accumulated other comprehensive ("AOCI") from changes in the unrealized gain on the interest rate swaps, net of tax (in thousands): Unrealized Gain Recognized in AOCI Third Quarter Ended Nine Months Ended September 30, 2018 September 24, 2017 September 30, 2018 September 24, 2017 $ 80 $ — $ 80 $ — |
ACCUMULATED OTHER COMPREHENSI_2
ACCUMULATED OTHER COMPREHENSIVE INCOME (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | The activity in AOCI is as follows: (thousands) Cash Flow Hedges Defined Benefit Pension Foreign Currency Items Total Balance at December 31, 2017 $ — $ 66 $ — $ 66 Other comprehensive income (loss) (net of tax of $28, $0 and $0) 80 — (31 ) 49 Balance at September 30, 2018 $ 80 $ 66 $ (31 ) $ 115 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Segment Reporting [Abstract] | |
Schedule of segment reporting information | The tables below present unaudited information about the sales and operating income of those segments. Third Quarter Ended September 30, 2018 (thousands) Manufacturing Distribution Total Net outside sales $ 445,214 $ 129,925 $ 575,139 Intersegment sales 8,182 1,097 9,279 Total sales 453,396 131,022 584,418 Operating income 54,887 7,606 62,493 Third Quarter Ended September 24, 2017 (thousands) Manufacturing Distribution Total Net outside sales $ 337,542 $ 69,969 $ 407,511 Intersegment sales 7,530 562 8,092 Total sales 345,072 70,531 415,603 Operating income 37,916 4,198 42,114 Nine Months Ended September 30, 2018 (thousands) Manufacturing Distribution Total Net outside sales $ 1,344,088 $ 387,762 $ 1,731,850 Intersegment sales 27,464 2,840 30,304 Total sales 1,371,552 390,602 1,762,154 Operating income 172,799 25,092 197,891 Nine Months Ended September 24, 2017 (thousands) Manufacturing Distribution Total Net outside sales $ 958,785 $ 201,298 $ 1,160,083 Intersegment sales 21,935 1,814 23,749 Total sales 980,720 203,112 1,183,832 Operating income 110,176 12,376 122,552 |
Summary of the reconciliation of segment operations | The following table presents a reconciliation of segment operating income to consolidated operating income: Third Quarter Ended Nine Months Ended (thousands) September 30, 2018 September 24, 2017 September 30, 2018 September 24, 2017 Operating income for reportable segments $ 62,493 $ 42,114 $ 197,891 $ 122,552 Unallocated corporate expenses (8,911 ) (6,703 ) (33,229 ) (20,517 ) Amortization (8,873 ) (5,237 ) (25,140 ) (14,239 ) Consolidated operating income $ 44,709 $ 30,174 $ 139,522 $ 87,796 |
BASIS OF PRESENTATION (Details)
BASIS OF PRESENTATION (Details) | Dec. 08, 2017 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Stock split conversion ratio | 1.5 |
REVENUE RECOGNITION - Schedule
REVENUE RECOGNITION - Schedule of Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 24, 2017 | Sep. 30, 2018 | Sep. 24, 2017 | |
Disaggregation of Revenue [Line Items] | ||||
NET SALES | $ 575,139 | $ 407,511 | $ 1,731,850 | $ 1,160,083 |
Recreational Vehicle [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
NET SALES | 354,573 | 1,128,026 | ||
Manufactured Housing [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
NET SALES | 67,762 | 200,352 | ||
Industrial [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
NET SALES | 72,335 | 212,591 | ||
Marine [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
NET SALES | 80,469 | 190,881 | ||
Manufacturing [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
NET SALES | 445,214 | 337,542 | 1,344,088 | 958,785 |
Manufacturing [Member] | Recreational Vehicle [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
NET SALES | 262,936 | 847,944 | ||
Manufacturing [Member] | Manufactured Housing [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
NET SALES | 41,428 | 124,406 | ||
Manufacturing [Member] | Industrial [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
NET SALES | 63,429 | 186,890 | ||
Manufacturing [Member] | Marine [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
NET SALES | 77,421 | 184,848 | ||
Distribution [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
NET SALES | 129,925 | $ 69,969 | 387,762 | $ 201,298 |
Distribution [Member] | Recreational Vehicle [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
NET SALES | 91,637 | 280,082 | ||
Distribution [Member] | Manufactured Housing [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
NET SALES | 26,334 | 75,946 | ||
Distribution [Member] | Industrial [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
NET SALES | 8,906 | 25,701 | ||
Distribution [Member] | Marine [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
NET SALES | $ 3,048 | $ 6,033 |
REVENUE RECOGNITION - Schedul_2
REVENUE RECOGNITION - Schedule of Contract Assets and Liabilities (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Jan. 01, 2018 | |
Revenue from Contract with Customer [Abstract] | ||
Receivables, which are included in trade receivables, net | $ 126,613 | $ 75,926 |
Contract liabilities | 2,523 | $ 1,310 |
Contract Liabilities | ||
Revenue recognized that was included in the contract liability balance at the beginning of the period | (1,165) | |
Increases due to cash received, excluding amounts recognized as revenue during the period | 2,190 | |
Accrued customer deposits related to business combinations | $ 188 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Inventory [Line Items] | ||
Raw materials | $ 128,897 | $ 96,846 |
Work in process | 13,898 | 10,720 |
Finished goods | 24,439 | 22,936 |
Total manufactured goods, net | 163,220 | 127,415 |
Materials purchased for resale (distribution products) | 81,621 | 49,392 |
Total materials purchased for resale (distribution products), net | 79,236 | 47,855 |
Total inventories | 242,456 | 175,270 |
Manufactured Goods [Member] | ||
Inventory [Line Items] | ||
Less: reserve for inventory obsolescence | (4,014) | (3,087) |
Distributed Goods [Member] | ||
Inventory [Line Items] | ||
Less: reserve for inventory obsolescence | $ (2,385) | $ (1,537) |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS - Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2018 | Sep. 24, 2017 | Sep. 30, 2018 | Sep. 24, 2017 | Dec. 31, 2017 | |
Intangible Assets [Line Items] | |||||
Goodwill and intangible asset impairment charges | $ 0 | $ 0 | |||
Intangible assets | $ 396,417,000 | 396,417,000 | $ 263,467,000 | ||
Amortization of intangible assets | 8,873,000 | $ 5,237,000 | 25,140,000 | $ 14,239,000 | |
Trademarks [Member] | |||||
Intangible Assets [Line Items] | |||||
Indefinite lived intangible assets | 82,200,000 | 82,200,000 | |||
Amortization of intangible assets | 0 | ||||
Customer Relationships and Noncompete Agreements [Member] | |||||
Intangible Assets [Line Items] | |||||
Intangible assets | $ 314,200,000 | $ 314,200,000 | |||
Noncompete Agreements [Member] | |||||
Intangible Assets [Line Items] | |||||
Intangible assets, weighted average useful life | 4 years 8 months 12 days | 4 years 73 days | |||
Customer Relationships [Member] | |||||
Intangible Assets [Line Items] | |||||
Intangible assets, weighted average useful life | 10 years 37 days | 10 years 2 months 12 days | |||
Aluminum Metals Company [Member] | Noncompete Agreements [Member] | |||||
Intangible Assets [Line Items] | |||||
Intangible assets, weighted average useful life | 3 years | ||||
Metal Moulding Corp, Indiana Marine Products, Collins & Company, Dehco Inc. and Dowco Inc. [Member] | Noncompete Agreements [Member] | |||||
Intangible Assets [Line Items] | |||||
Intangible assets, weighted average useful life | 5 years | ||||
2018 Acquisitions [Member] | Customer Relationships [Member] | |||||
Intangible Assets [Line Items] | |||||
Intangible assets, weighted average useful life | 10 years | ||||
Minimum [Member] | Customer Relationships and Noncompete Agreements [Member] | |||||
Intangible Assets [Line Items] | |||||
Intangible assets, weighted average useful life | 3 years | ||||
Maximum [Member] | Customer Relationships and Noncompete Agreements [Member] | |||||
Intangible Assets [Line Items] | |||||
Intangible assets, weighted average useful life | 19 years |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS - Carrying Amount of Goodwill by Segment (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Goodwill [Roll Forward] | |
Balance - December 31, 2017 | $ 208,044 |
Acquisitions | 53,161 |
Adjustment to prior year preliminary purchase price allocation | (3,092) |
Balance - September 30, 2018 | 258,113 |
Manufacturing [Member] | |
Goodwill [Roll Forward] | |
Balance - December 31, 2017 | 179,471 |
Acquisitions | 40,144 |
Adjustment to prior year preliminary purchase price allocation | (4,070) |
Balance - September 30, 2018 | 215,545 |
Distribution [Member] | |
Goodwill [Roll Forward] | |
Balance - December 31, 2017 | 28,573 |
Acquisitions | 13,017 |
Adjustment to prior year preliminary purchase price allocation | 978 |
Balance - September 30, 2018 | $ 42,568 |
GOODWILL AND INTANGIBLE ASSET_4
GOODWILL AND INTANGIBLE ASSETS - Intangible Assets, Net, by Major Class (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2018 | Dec. 31, 2017 | |
Intangible Assets [Line Items] | ||
Total other intangible assets, net, excluding accumulated amortization | $ 473,155 | $ 315,065 |
Less: accumulated amortization | (76,738) | (51,598) |
Intangible assets, net | 396,417 | 263,467 |
Customer Relationships [Member] | ||
Intangible Assets [Line Items] | ||
Finite-lived intangible assets | $ 369,339 | $ 239,053 |
Intangible assets, weighted average useful life | 10 years 37 days | 10 years 2 months 12 days |
Noncompete Agreements [Member] | ||
Intangible Assets [Line Items] | ||
Finite-lived intangible assets | $ 21,566 | $ 15,564 |
Intangible assets, weighted average useful life | 4 years 8 months 12 days | 4 years 73 days |
Trademarks [Member] | ||
Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | $ 82,250 | $ 60,448 |
GOODWILL AND INTANGIBLE ASSET_5
GOODWILL AND INTANGIBLE ASSETS - Intangible Assets by Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 24, 2017 | Sep. 30, 2018 | Sep. 24, 2017 | |
Intangible Assets [Roll Forward] | ||||
Balance - December 31, 2017 | $ 263,467 | |||
Acquisitions | 156,035 | |||
Amortization | $ (8,873) | $ (5,237) | (25,140) | $ (14,239) |
Adjustment to prior year preliminary purchase price allocation | 2,055 | |||
Balance - September 30, 2018 | 396,417 | 396,417 | ||
Manufacturing [Member] | ||||
Intangible Assets [Roll Forward] | ||||
Balance - December 31, 2017 | 220,540 | |||
Acquisitions | 117,012 | |||
Amortization | (20,207) | |||
Adjustment to prior year preliminary purchase price allocation | 2,070 | |||
Balance - September 30, 2018 | 319,415 | 319,415 | ||
Distribution [Member] | ||||
Intangible Assets [Roll Forward] | ||||
Balance - December 31, 2017 | 42,927 | |||
Acquisitions | 39,023 | |||
Amortization | (4,933) | |||
Adjustment to prior year preliminary purchase price allocation | (15) | |||
Balance - September 30, 2018 | $ 77,002 | $ 77,002 |
ACQUISITIONS - Narrative (Detai
ACQUISITIONS - Narrative (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||||||||
Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | May 31, 2018USD ($) | Apr. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Feb. 28, 2018USD ($) | Dec. 31, 2017USD ($) | Nov. 30, 2017USD ($)facility | Sep. 30, 2017USD ($) | Jul. 31, 2017USD ($) | Apr. 30, 2017USD ($)company | Mar. 31, 2017USD ($) | Sep. 30, 2018USD ($) | Apr. 01, 2018USD ($) | Sep. 24, 2017USD ($) | Sep. 30, 2018USD ($)companyacquisition | Sep. 24, 2017USD ($)businesscompanyacquisition | Dec. 31, 2017companyacquisition | |
Business Acquisition [Line Items] | ||||||||||||||||||
Number of acquisitions | acquisition | 8 | 4 | 7 | |||||||||||||||
Number of companies acquired | company | 6 | 13 | ||||||||||||||||
Operating Income | $ 44,709 | $ 30,174 | $ 139,522 | $ 87,796 | ||||||||||||||
Contingent consideration liability | $ 15,800 | 15,800 | 15,800 | |||||||||||||||
Contingent consideration arrangements maximum payments amount | 22,000 | 22,000 | 22,000 | |||||||||||||||
Adjustment to prior year preliminary purchase price allocation | (3,092) | |||||||||||||||||
Adjustment to prior year preliminary purchase price allocation intangibles | 2,055 | |||||||||||||||||
Pro forma amortization expense | 400 | 5,200 | $ 5,400 | $ 18,100 | ||||||||||||||
Acquired Entities [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Number of companies acquired | 12 | 6 | ||||||||||||||||
Revenues | 82,400 | 29,300 | $ 160,000 | $ 47,700 | ||||||||||||||
Operating Income | 8,800 | $ 4,000 | 17,300 | $ 6,000 | ||||||||||||||
Metal Moulding Corporation [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Contingent consideration liability | 1,400 | $ 1,400 | 1,400 | 1,400 | ||||||||||||||
Net purchase price | $ 19,900 | |||||||||||||||||
Contingent consideration performance period | 1 year | |||||||||||||||||
Aluminum Metals Company [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Net purchase price | $ 17,800 | |||||||||||||||||
Indiana Marine Products [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Contingent consideration liability | 7,900 | $ 7,900 | 7,900 | 7,900 | ||||||||||||||
Net purchase price | $ 18,600 | |||||||||||||||||
Contingent consideration performance period | 3 years | |||||||||||||||||
Collins & Company [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Net purchase price | $ 40,000 | |||||||||||||||||
Dehco Inc [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Net purchase price | $ 52,800 | |||||||||||||||||
Dowco Inc. [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Net purchase price | $ 56,900 | |||||||||||||||||
Marine Accessories Corporation [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Net purchase price | $ 58,200 | |||||||||||||||||
Engineered Metals And Composites [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Contingent consideration liability | 2,500 | 2,500 | 2,500 | |||||||||||||||
Net purchase price | $ 25,900 | |||||||||||||||||
Contingent consideration payout term | 3 months | |||||||||||||||||
Medallion Plastics [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Net purchase price | $ 9,900 | |||||||||||||||||
Leisure Product Enterprises, LLC [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Net purchase price | $ 73,300 | |||||||||||||||||
Percent of common stock acquired | 100.00% | |||||||||||||||||
Acquiree composition, number of manufacturing companies | company | 3 | |||||||||||||||||
Adjustment to prior year preliminary purchase price allocation | $ (600) | |||||||||||||||||
Adjustment to prior year preliminary purchase price allocation intangibles | 900 | |||||||||||||||||
Increase to deferred tax liability | 300 | |||||||||||||||||
Wire Design [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Net purchase price | $ 10,800 | |||||||||||||||||
Adjustment to prior year preliminary purchase price allocation | (200) | |||||||||||||||||
Adjustment to prior year preliminary purchase price allocation intangibles | $ 200 | |||||||||||||||||
Baymont Inc. [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Contingent consideration liability | $ 4,000 | $ 5,100 | 4,000 | 4,000 | ||||||||||||||
Net purchase price | $ 3,800 | |||||||||||||||||
Contingent consideration performance period | 6 years | |||||||||||||||||
Adjustment to prior year preliminary purchase price allocation | (1,700) | (1,100) | ||||||||||||||||
Increase (decrease) adjustment to prior year purchase price allocation property plant and equipment | 300 | |||||||||||||||||
Adjustment to prior year preliminary purchase price allocation intangibles | 900 | |||||||||||||||||
Decrease in contingent consideration liability | 1,100 | |||||||||||||||||
Indiana Transport Inc [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Net purchase price | $ 58,800 | |||||||||||||||||
Adjustment to prior year preliminary purchase price allocation | 1,000 | |||||||||||||||||
Increase (decrease) adjustment to prior year purchase price allocation property plant and equipment | (1,000) | |||||||||||||||||
Increase (decrease) adjustment to previously recorded accounts payable and accrued liabilities | 600 | |||||||||||||||||
LMI, Inc. And Related Companies [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Net purchase price | $ 80,900 | |||||||||||||||||
Acquiree composition, number of manufacturing companies | facility | 6 | |||||||||||||||||
Adjustment to prior year preliminary purchase price allocation | (600) | |||||||||||||||||
Increase (decrease) adjustment to prior year purchase price allocation property plant and equipment | 2,000 | |||||||||||||||||
Nickell Moulding Company, Inc. [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Net purchase price | $ 12,600 | |||||||||||||||||
Adjustment to prior year preliminary purchase price allocation | (800) | |||||||||||||||||
Increase (decrease) adjustment to prior year purchase price allocation property plant and equipment | 300 | |||||||||||||||||
Increase (decrease) adjustment to previously recorded accounts payable and accrued liabilities | (600) | |||||||||||||||||
Decrease to trade receivable | 200 | |||||||||||||||||
Decrease to goodwill | 400 | |||||||||||||||||
Accrued Liabilities [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Contingent consideration liability | 3,900 | 3,900 | 3,900 | |||||||||||||||
Other Long-term Liabilities [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||||
Contingent consideration liability | $ 11,900 | $ 11,900 | $ 11,900 |
ACQUISITIONS - Fair Value of As
ACQUISITIONS - Fair Value of Assets Acquired, Summary (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |||||||||||
Sep. 30, 2018 | Sep. 24, 2017 | Dec. 31, 2017 | Jun. 30, 2018 | May 31, 2018 | Apr. 30, 2018 | Mar. 31, 2018 | Feb. 28, 2018 | Nov. 30, 2017 | Sep. 30, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Mar. 31, 2017 | |
Business Acquisition [Line Items] | |||||||||||||
Goodwill | $ 258,113 | $ 208,044 | |||||||||||
Contingent consideration liability | 15,800 | ||||||||||||
Net cash paid for business | 290,052 | $ 97,261 | |||||||||||
Metal Moulding Corporation [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Trade receivables | $ 1,474 | ||||||||||||
Inventories | 2,324 | ||||||||||||
Property, plant and equipment | 3,000 | ||||||||||||
Prepaid expenses & other | 0 | ||||||||||||
Intangible assets | 10,626 | ||||||||||||
Goodwill | 4,647 | ||||||||||||
Less: Accounts payable and accrued liabilities | 818 | ||||||||||||
Less: Deferred tax liability | 0 | ||||||||||||
Total net assets acquired | 21,253 | ||||||||||||
Contingent consideration liability | 1,400 | 1,400 | |||||||||||
Net cash paid for business | 19,900 | ||||||||||||
Aluminum Metals Company [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Trade receivables | 3,966 | ||||||||||||
Inventories | 5,631 | ||||||||||||
Property, plant and equipment | 4,000 | ||||||||||||
Prepaid expenses & other | 39 | ||||||||||||
Intangible assets | 5,350 | ||||||||||||
Goodwill | 1,243 | ||||||||||||
Less: Accounts payable and accrued liabilities | 2,462 | ||||||||||||
Less: Deferred tax liability | 0 | ||||||||||||
Total net assets acquired | $ 17,767 | ||||||||||||
Indiana Marine Products [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Trade receivables | $ 1,962 | ||||||||||||
Inventories | 4,286 | ||||||||||||
Property, plant and equipment | 1,306 | ||||||||||||
Prepaid expenses & other | 13 | ||||||||||||
Intangible assets | 17,997 | ||||||||||||
Goodwill | 3,821 | ||||||||||||
Less: Accounts payable and accrued liabilities | 2,886 | ||||||||||||
Less: Deferred tax liability | 0 | ||||||||||||
Total net assets acquired | 26,499 | ||||||||||||
Contingent consideration liability | 7,900 | 7,900 | |||||||||||
Net cash paid for business | 18,600 | ||||||||||||
Collins & Company [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Trade receivables | 2,854 | ||||||||||||
Inventories | 9,922 | ||||||||||||
Property, plant and equipment | 1,125 | ||||||||||||
Prepaid expenses & other | 5 | ||||||||||||
Intangible assets | 22,000 | ||||||||||||
Goodwill | 6,662 | ||||||||||||
Less: Accounts payable and accrued liabilities | 2,561 | ||||||||||||
Less: Deferred tax liability | 0 | ||||||||||||
Total net assets acquired | $ 40,007 | ||||||||||||
Dehco Inc [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Trade receivables | $ 4,727 | ||||||||||||
Inventories | 18,416 | ||||||||||||
Property, plant and equipment | 14,175 | ||||||||||||
Prepaid expenses & other | 356 | ||||||||||||
Intangible assets | 14,200 | ||||||||||||
Goodwill | 4,100 | ||||||||||||
Less: Accounts payable and accrued liabilities | 3,194 | ||||||||||||
Less: Deferred tax liability | 0 | ||||||||||||
Total net assets acquired | $ 52,780 | ||||||||||||
Dowco Inc. [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Trade receivables | $ 4,136 | ||||||||||||
Inventories | 4,498 | ||||||||||||
Property, plant and equipment | 5,910 | ||||||||||||
Prepaid expenses & other | 1,869 | ||||||||||||
Intangible assets | 34,379 | ||||||||||||
Goodwill | 10,340 | ||||||||||||
Less: Accounts payable and accrued liabilities | 4,198 | ||||||||||||
Less: Deferred tax liability | 0 | ||||||||||||
Total net assets acquired | $ 56,934 | ||||||||||||
Marine Accessories Corporation [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Trade receivables | $ 3,081 | ||||||||||||
Inventories | 6,867 | ||||||||||||
Property, plant and equipment | 8,000 | ||||||||||||
Prepaid expenses & other | 1,558 | ||||||||||||
Intangible assets | 32,733 | ||||||||||||
Goodwill | 18,448 | ||||||||||||
Less: Accounts payable and accrued liabilities | 4,109 | ||||||||||||
Less: Deferred tax liability | 8,373 | ||||||||||||
Total net assets acquired | $ 58,205 | ||||||||||||
Engineered Metals And Composites [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Trade receivables | 600 | ||||||||||||
Inventories | 2,018 | ||||||||||||
Property, plant and equipment | 3,500 | ||||||||||||
Prepaid expenses & other | 0 | ||||||||||||
Intangible assets | 18,750 | ||||||||||||
Goodwill | 3,900 | ||||||||||||
Less: Accounts payable and accrued liabilities | 387 | ||||||||||||
Less: Deferred tax liability | 0 | ||||||||||||
Total net assets acquired | 28,381 | ||||||||||||
Contingent consideration liability | 2,500 | ||||||||||||
Net cash paid for business | 25,900 | ||||||||||||
Medallion Plastics [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Trade receivables | $ 2,233 | ||||||||||||
Inventories | 2,605 | ||||||||||||
Property, plant and equipment | 1,713 | ||||||||||||
Prepaid expenses & other | 118 | ||||||||||||
Intangible assets | 3,100 | ||||||||||||
Goodwill | 1,342 | ||||||||||||
Less: Accounts payable and accrued liabilities | 1,200 | ||||||||||||
Less: Deferred tax liability | 0 | ||||||||||||
Total net assets acquired | $ 9,911 | ||||||||||||
Leisure Product Enterprises, LLC [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Trade receivables | $ 5,848 | ||||||||||||
Inventories | 5,162 | ||||||||||||
Property, plant and equipment | 9,225 | ||||||||||||
Prepaid expenses & other | 337 | ||||||||||||
Intangible assets | 33,275 | ||||||||||||
Goodwill | 39,945 | ||||||||||||
Less: Accounts payable and accrued liabilities | 6,358 | ||||||||||||
Less: Deferred tax liability | 14,140 | ||||||||||||
Total net assets acquired | $ 73,294 | ||||||||||||
Wire Design [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Trade receivables | $ 615 | ||||||||||||
Inventories | 437 | ||||||||||||
Property, plant and equipment | 555 | ||||||||||||
Prepaid expenses & other | 21 | ||||||||||||
Intangible assets | 5,590 | ||||||||||||
Goodwill | 4,052 | ||||||||||||
Less: Accounts payable and accrued liabilities | 491 | ||||||||||||
Less: Deferred tax liability | 0 | ||||||||||||
Total net assets acquired | $ 10,779 | ||||||||||||
Baymont Inc. [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Trade receivables | $ 0 | ||||||||||||
Inventories | 1,174 | ||||||||||||
Property, plant and equipment | 2,067 | ||||||||||||
Prepaid expenses & other | 0 | ||||||||||||
Intangible assets | 3,166 | ||||||||||||
Goodwill | 1,502 | ||||||||||||
Less: Accounts payable and accrued liabilities | 69 | ||||||||||||
Less: Deferred tax liability | 0 | ||||||||||||
Total net assets acquired | 7,840 | ||||||||||||
Contingent consideration liability | 4,000 | $ 5,100 | |||||||||||
Net cash paid for business | 3,800 | ||||||||||||
Indiana Transport Inc [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Trade receivables | $ 6,379 | ||||||||||||
Inventories | 0 | ||||||||||||
Property, plant and equipment | 2,594 | ||||||||||||
Prepaid expenses & other | 1,309 | ||||||||||||
Intangible assets | 31,375 | ||||||||||||
Goodwill | 20,250 | ||||||||||||
Less: Accounts payable and accrued liabilities | 3,117 | ||||||||||||
Less: Deferred tax liability | 0 | ||||||||||||
Total net assets acquired | 58,790 | ||||||||||||
LMI, Inc. And Related Companies [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Trade receivables | 11,222 | ||||||||||||
Inventories | 9,086 | ||||||||||||
Property, plant and equipment | 6,028 | ||||||||||||
Prepaid expenses & other | 994 | ||||||||||||
Intangible assets | 36,110 | ||||||||||||
Goodwill | 25,910 | ||||||||||||
Less: Accounts payable and accrued liabilities | 8,472 | ||||||||||||
Less: Deferred tax liability | 0 | ||||||||||||
Total net assets acquired | $ 80,878 | ||||||||||||
Nickell Moulding Company, Inc. [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Trade receivables | 1,762 | ||||||||||||
Inventories | 1,550 | ||||||||||||
Property, plant and equipment | 1,240 | ||||||||||||
Prepaid expenses & other | 0 | ||||||||||||
Intangible assets | 6,179 | ||||||||||||
Goodwill | 2,421 | ||||||||||||
Less: Accounts payable and accrued liabilities | 556 | ||||||||||||
Less: Deferred tax liability | 0 | ||||||||||||
Total net assets acquired | 12,596 | ||||||||||||
Series of Individually Immaterial Business Acquisitions [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Trade receivables | 0 | ||||||||||||
Inventories | 250 | ||||||||||||
Property, plant and equipment | 2,668 | ||||||||||||
Prepaid expenses & other | 0 | ||||||||||||
Intangible assets | 0 | ||||||||||||
Goodwill | 668 | ||||||||||||
Less: Accounts payable and accrued liabilities | 124 | ||||||||||||
Less: Deferred tax liability | 0 | ||||||||||||
Total net assets acquired | 3,462 | ||||||||||||
Acquired Entities [Member] | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Trade receivables | 22,800 | 28,059 | |||||||||||
Inventories | 53,962 | 20,264 | |||||||||||
Property, plant and equipment | 41,016 | 26,090 | |||||||||||
Prepaid expenses & other | 3,840 | 2,779 | |||||||||||
Intangible assets | 156,035 | 118,795 | |||||||||||
Goodwill | 53,161 | 96,090 | |||||||||||
Less: Accounts payable and accrued liabilities | 20,615 | 20,387 | |||||||||||
Less: Deferred tax liability | 8,373 | 14,140 | |||||||||||
Total net assets acquired | $ 301,826 | $ 257,550 |
ACQUISITIONS - Pro Forma Inform
ACQUISITIONS - Pro Forma Information Related to Acquisitions (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 24, 2017 | Sep. 30, 2018 | Sep. 24, 2017 | |
Business Combinations [Abstract] | ||||
Revenue | $ 579,432 | $ 544,709 | $ 1,846,631 | $ 1,591,758 |
Net income | $ 28,393 | $ 23,134 | $ 99,652 | $ 75,832 |
Basic net income per common share (in dollars per share) | $ 1.19 | $ 0.94 | $ 4.10 | $ 3.16 |
Diluted net income per common share (in dollars per share) | $ 1.17 | $ 0.92 | $ 4.05 | $ 3.11 |
STOCK-BASED COMPENSATION (Detai
STOCK-BASED COMPENSATION (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2018 | Sep. 24, 2017 | Sep. 30, 2018 | Sep. 24, 2017 | Dec. 31, 2017 | Jan. 17, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based compensation expense | $ 3.5 | $ 2.6 | $ 10.9 | $ 7.8 | ||
Unrecognized compensation cost | $ 24.2 | $ 24.2 | ||||
Weighted average recognition period | 21 months 3 days | |||||
The 2009 Plan [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares approved (in shares) | 181,808 | 181,808 | 233,654 | |||
Granted shares (in shares) | 167,504 | |||||
The 2009 Plan [Member] | Employee Stock Option [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares approved (in shares) | 340,110 | |||||
The 2009 Plan [Member] | Stock Appreciation Rights (SARs) [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares approved (in shares) | 340,128 |
NET INCOME PER COMMON SHARE - I
NET INCOME PER COMMON SHARE - Income Per Share Calculation (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2018 | Sep. 24, 2017 | Sep. 30, 2018 | Sep. 24, 2017 | |||
Earnings Per Share [Abstract] | ||||||
Net income for basic and diluted per share calculation | $ 27,934 | $ 17,945 | $ 92,862 | $ 56,672 | ||
Weighted average shares outstanding - basic (in shares) | 23,894 | 24,663 | [1] | 24,279 | 24,066 | [1] |
Effect of potentially dilutive securities (in shares) | 338 | 369 | 340 | 410 | ||
Weighted average common shares outstanding - diluted (in shares) | 24,232 | 25,032 | [1] | 24,619 | 24,476 | [1] |
Basic net income per common share (in dollars per share) | $ 1.17 | $ 0.73 | [1] | $ 3.82 | $ 2.35 | [1] |
Diluted net income per common share (in dollars per share) | $ 1.15 | $ 0.72 | [1] | $ 3.77 | $ 2.32 | [1] |
[1] | Net income per common share and weighted average shares outstanding, on both a basic and diluted basis, for the third quarter and nine months ended September 24, 2017, have been retroactively adjusted to reflect the impact of the three-for-two stock split paid on December 8, 2017. |
DEBT - Schedule of Long-term De
DEBT - Schedule of Long-term Debt (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Debt Instrument [Line Items] | ||
Total long-term debt | $ 634,000 | $ 354,357 |
Less: Convertible Notes debt discount | (31,699) | 0 |
Less: current maturities of long-term debt | (7,500) | (15,766) |
Less: net deferred financing costs related to Term Loan | (467) | (480) |
Total long-term debt, less current maturities, net | 594,334 | 338,111 |
Line of Credit [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 364,000 | 287,397 |
Term Loan [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 97,500 | 66,960 |
Convertible Debt [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | $ 172,500 | $ 0 |
DEBT - Narrative (Details)
DEBT - Narrative (Details) | Jun. 05, 2018USD ($) | Jan. 31, 2018USD ($)shares$ / shares | Sep. 30, 2018USD ($) | Sep. 24, 2017USD ($) | Sep. 30, 2018USD ($) | Sep. 24, 2017USD ($) | Dec. 31, 2017USD ($) | Apr. 28, 2015USD ($) |
Line of Credit Facility [Line Items] | ||||||||
Outstanding debt | $ 634,000,000 | $ 634,000,000 | $ 354,357,000 | |||||
Debt instrument, covenant, maximum leverage ratio | 3 | 3 | ||||||
Debt instrument, covenant, minimum interest coverage ratio | 1.50 | |||||||
Interest paid | $ 6,600,000 | $ 2,300,000 | $ 12,200,000 | $ 5,800,000 | ||||
Debt discount | $ 31,699,000 | 31,699,000 | $ 0 | |||||
Proceeds from convertible notes offering | $ 172,500,000 | $ 0 | ||||||
Revolving Credit Facility [Member] | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Unused capacity, commitment fee percentage | 0.25% | 0.20% | ||||||
The Lenders [Member] | Revolving Credit Facility [Member] | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Maximum borrowing capacity | $ 417,300,000 | |||||||
London Interbank Offered Rate (LIBOR) [Member] | Revolving Credit Facility [Member] | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Debt instrument, basis spread on variable rate | 2.00% | 1.50% | ||||||
Debt instrument, effective interest rate | 4.26% | 4.26% | 3.125% | |||||
London Interbank Offered Rate (LIBOR) [Member] | The Lenders [Member] | Revolving Credit Facility [Member] | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Long-term line of credit | $ 348,000,000 | $ 348,000,000 | $ 281,000,000 | |||||
Base Rate [Member] | The Lenders [Member] | Revolving Credit Facility [Member] | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Long-term line of credit | $ 16,000,000 | $ 16,000,000 | ||||||
Prime Rate [Member] | Revolving Credit Facility [Member] | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Debt instrument, basis spread on variable rate | 1.00% | 0.50% | ||||||
Debt instrument, effective interest rate | 6.25% | 6.25% | 5.00% | |||||
Prime Rate [Member] | The Lenders [Member] | Revolving Credit Facility [Member] | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Long-term line of credit | $ 6,400,000 | |||||||
Term Loan [Member] | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Outstanding debt | $ 97,500,000 | $ 97,500,000 | 66,960,000 | |||||
Term Loan [Member] | The Lenders [Member] | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Maximum borrowing capacity | $ 82,700,000 | |||||||
Line of Credit [Member] | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Outstanding debt | 364,000,000 | 364,000,000 | 287,397,000 | |||||
Same Day Advance Swing Line [Member] | The Lenders [Member] | Revolving Credit Facility [Member] | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Maximum borrowing capacity | $ 10,000,000 | |||||||
Sub Facility, Standby Letters of Credit [Member] | The Lenders [Member] | Revolving Credit Facility [Member] | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Maximum borrowing capacity | 10,000,000 | |||||||
Convertible Debt [Member] | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Outstanding debt | 172,500,000 | 172,500,000 | $ 0 | |||||
2018 Credit Facility [Member] | Term Loan [Member] | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Aggregate principal amount | 100,000,000 | |||||||
2018 Credit Facility [Member] | Line of Credit [Member] | Revolving Credit Facility [Member] | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Maximum borrowing capacity | 800,000,000 | |||||||
Convertible Senior Notes Due 2023 [Member] | Convertible Debt [Member] | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Aggregate principal amount | $ 172,500,000 | |||||||
Stated interest rate | 1.00% | |||||||
Debt discount | $ 36,000,000 | 31,700,000 | 31,700,000 | |||||
Debt discount attributable to difference in future cash flows and principal amount | 31,900,000 | |||||||
Debt discount attributable to issuance cost | 4,100,000 | |||||||
Proceeds from convertible notes offering | $ 167,500,000 | |||||||
Debt conversion ratio | 0.0113785 | |||||||
Debt conversion shares issued if converted (in shares) | shares | 1,962,790 | |||||||
Debt conversion price (in dollars per share) | $ / shares | $ 87.89 | |||||||
June 30, 2018 To March 31, 2019 [Member] | 2018 Credit Facility [Member] | Term Loan [Member] | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Debt instrument, periodic payment | 1,250,000 | |||||||
June 30, 2019 To March 31, 2021 [Member] | 2018 Credit Facility [Member] | Term Loan [Member] | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Debt instrument, periodic payment | 2,500,000 | |||||||
June 30, 2021 Thereafter [Member] | 2018 Credit Facility [Member] | Term Loan [Member] | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Debt instrument, periodic payment | $ 3,750,000 | |||||||
Interest Rate Swap [Member] | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Derivative amount | $ 200,000,000 | $ 200,000,000 | ||||||
Derivative interest rate | 2.91% | 2.91% | ||||||
Derivative interest rate cap | 4.91% | 4.91% |
DEBT - Schedule of Financial Ra
DEBT - Schedule of Financial Ratio Covenants (Details) | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Consolidated total leverage ratio, required | 3 |
Consolidated leverage ratio, actual | 226.00% |
Consolidated fixed charge coverage ratio, required | 1.50 |
Consolidated fixed charge coverage ratio, actual | 351.00% |
DERIVATIVE FINANCIAL INSTRUME_3
DERIVATIVE FINANCIAL INSTRUMENTS - Narrative (Details) | 1 Months Ended | 9 Months Ended | ||
Jan. 31, 2018USD ($)shares$ / shares | Sep. 30, 2018USD ($) | Sep. 24, 2017USD ($) | Jan. 01, 2018shares | |
Derivative [Line Items] | ||||
Proceeds from sale of warrants | $ 18,100,000 | $ 18,147,000 | $ 0 | |
Interest Rate Swap [Member] | ||||
Derivative [Line Items] | ||||
Derivative amount | 200,000,000 | |||
Convertible Senior Notes Due 2023 [Member] | Convertible Debt [Member] | ||||
Derivative [Line Items] | ||||
Debt conversion shares issued if converted (in shares) | shares | 1,962,790 | |||
Debt conversion price (in dollars per share) | $ / shares | $ 87.89 | |||
Shares issued under warrant (in shares) | shares | 1,962,790 | |||
Initial warrant strike price (in dollars per share) | $ / shares | $ 113.93 | |||
Designated as Hedging Instrument [Member] | Convertible Debt Contract [Member] | ||||
Derivative [Line Items] | ||||
Payments for derivatives | $ 31,500,000 | |||
Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | ||||
Derivative [Line Items] | ||||
Derivative amount | $ 200,000,000 |
DERIVATIVE FINANCIAL INSTRUME_4
DERIVATIVE FINANCIAL INSTRUMENTS - Derivative Assets and Liabilities at Fair Value (Details) - Designated as Hedging Instrument [Member] - Interest Rate Swap [Member] - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Derivative [Line Items] | ||
Fair value of derivative assets | $ 194 | $ 0 |
Fair value of derivative liabilities | $ 86 | $ 0 |
DERIVATIVE FINANCIAL INSTRUME_5
DERIVATIVE FINANCIAL INSTRUMENTS - Schedule of Derivative Gains and Losses Recognized in AOCI (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 24, 2017 | Sep. 30, 2018 | Sep. 24, 2017 | |
Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | ||||
Derivative [Line Items] | ||||
Unrealized Gain Recognized in AOCI | $ 80 | $ 0 | $ 80 | $ 0 |
ACCUMULATED OTHER COMPREHENSI_3
ACCUMULATED OTHER COMPREHENSIVE INCOME - Schedule of Accumulated Other Comprehensive Income (Loss) (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2018USD ($) | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |
Beginning Balance | $ 370,685 |
Other comprehensive income (loss) (net of tax of $28, $0 and $0) | 49 |
Ending Balance | 414,218 |
AOCI Attributable to Parent [Member] | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |
Beginning Balance | 66 |
Ending Balance | 115 |
Cash Flow Hedges [Member] | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |
Beginning Balance | 0 |
Other comprehensive income (loss) (net of tax of $28, $0 and $0) | 80 |
Ending Balance | 80 |
Other comprehensive income (loss), tax | 28 |
Defined Benefit Pension [Member] | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |
Beginning Balance | 66 |
Other comprehensive income (loss) (net of tax of $28, $0 and $0) | 0 |
Ending Balance | 66 |
Other comprehensive income (loss), tax | 0 |
Foreign Currency Items [Member] | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |
Beginning Balance | 0 |
Other comprehensive income (loss) (net of tax of $28, $0 and $0) | (31) |
Ending Balance | (31) |
Other comprehensive income (loss), tax | $ 0 |
FAIR VALUE MEASUREMENTS - Narra
FAIR VALUE MEASUREMENTS - Narrative (Details) $ in Millions | Sep. 30, 2018USD ($) |
Fair Value, Inputs, Level 2 [Member] | Convertible Debt [Member] | Convertible Senior Notes Due 2023 [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Fair value of convertible debt | $ 164.4 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 24, 2017 | Sep. 30, 2018 | Sep. 24, 2017 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate | 25.30% | 36.00% | 23.60% | 30.60% |
Excess tax benefit tax | $ 0 | $ 21,000 | $ 2,200,000 | $ 4,600,000 |
Income taxes paid | $ 5,600,000 | $ 11,000,000 | $ 21,000,000 | $ 30,500,000 |
SEGMENT INFORMATION - Narrative
SEGMENT INFORMATION - Narrative (Details) - Sales Revenue, Goods, Net [Member] - Product Concentration Risk [Member] | 9 Months Ended | |
Sep. 30, 2018 | Sep. 24, 2017 | |
Manufacturing [Member] | ||
Segment Reporting Information [Line Items] | ||
Concentration risk, percentage | 78.00% | 83.00% |
Distribution [Member] | ||
Segment Reporting Information [Line Items] | ||
Concentration risk, percentage | 22.00% | 17.00% |
SEGMENT INFORMATION - Sales and
SEGMENT INFORMATION - Sales and Operating Income of Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 24, 2017 | Sep. 30, 2018 | Sep. 24, 2017 | |
Segment Reporting Information [Line Items] | ||||
NET SALES | $ 575,139 | $ 407,511 | $ 1,731,850 | $ 1,160,083 |
Operating income | 44,709 | 30,174 | 139,522 | 87,796 |
Intersegment sales [Member] | ||||
Segment Reporting Information [Line Items] | ||||
NET SALES | 9,279 | 8,092 | 30,304 | 23,749 |
Operating Segments [Member] | ||||
Segment Reporting Information [Line Items] | ||||
NET SALES | 584,418 | 415,603 | 1,762,154 | 1,183,832 |
Operating income | 62,493 | 42,114 | 197,891 | 122,552 |
Manufacturing [Member] | ||||
Segment Reporting Information [Line Items] | ||||
NET SALES | 445,214 | 337,542 | 1,344,088 | 958,785 |
Manufacturing [Member] | Intersegment sales [Member] | ||||
Segment Reporting Information [Line Items] | ||||
NET SALES | 8,182 | 7,530 | 27,464 | 21,935 |
Manufacturing [Member] | Operating Segments [Member] | ||||
Segment Reporting Information [Line Items] | ||||
NET SALES | 453,396 | 345,072 | 1,371,552 | 980,720 |
Operating income | 54,887 | 37,916 | 172,799 | 110,176 |
Distribution [Member] | ||||
Segment Reporting Information [Line Items] | ||||
NET SALES | 129,925 | 69,969 | 387,762 | 201,298 |
Distribution [Member] | Intersegment sales [Member] | ||||
Segment Reporting Information [Line Items] | ||||
NET SALES | 1,097 | 562 | 2,840 | 1,814 |
Distribution [Member] | Operating Segments [Member] | ||||
Segment Reporting Information [Line Items] | ||||
NET SALES | 131,022 | 70,531 | 390,602 | 203,112 |
Operating income | $ 7,606 | $ 4,198 | $ 25,092 | $ 12,376 |
SEGMENT INFORMATION - Reconcili
SEGMENT INFORMATION - Reconciliation of Segment Operating Income to Consolidated Operating Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 24, 2017 | Sep. 30, 2018 | Sep. 24, 2017 | |
Segment Reporting Information [Line Items] | ||||
Operating Income | $ 44,709 | $ 30,174 | $ 139,522 | $ 87,796 |
Unallocated corporate expenses | (61,946) | (39,009) | (179,679) | (110,436) |
Amortization | (8,873) | (5,237) | (25,140) | (14,239) |
Operating Segments [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Operating Income | 62,493 | 42,114 | 197,891 | 122,552 |
Segment Reconciling Items [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Unallocated corporate expenses | (8,911) | (6,703) | (33,229) | (20,517) |
Amortization | $ (8,873) | $ (5,237) | $ (25,140) | $ (14,239) |
STOCK REPURCHASE PROGRAMS - Nar
STOCK REPURCHASE PROGRAMS - Narrative (Details) - 2018 Stock Repurchase Plan [Member] - USD ($) | 1 Months Ended | 9 Months Ended | 10 Months Ended | ||
Oct. 31, 2018 | May 31, 2018 | Jan. 31, 2018 | Sep. 30, 2018 | Nov. 07, 2018 | |
Share Repurchase Program [Line Items] | |||||
Stock repurchase program, authorized amount | $ 50,000,000 | $ 50,000,000 | |||
Stock repurchase program, period in force | 24 months | 24 months | |||
Remaining authorized shares to be purchased amount | $ 8,500,000 | ||||
Shares repurchased (in shares) | 1,282,930 | ||||
Average cost per share repurchased (in dollars per share) | $ 58.48 | ||||
Shares repurchased amount | $ 75,000,000 | ||||
Subsequent Event [Member] | |||||
Share Repurchase Program [Line Items] | |||||
Stock repurchase program, authorized amount | $ 50,000,000 | ||||
Stock repurchase program, period in force | 24 months | ||||
Remaining authorized shares to be purchased amount | $ 3,610,812.45 | ||||
Shares repurchased (in shares) | 1,796,484 | ||||
Average cost per share repurchased (in dollars per share) | $ 56.12 | ||||
Shares repurchased amount | $ 100,800,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2018USD ($)employee | |
Board Member [Member] | |
Related Party Transaction [Line Items] | |
Number of independent board members with transactions with the Company | employee | 2 |
Welch Packaging Group [Member] | |
Related Party Transaction [Line Items] | |
Purchases from related parties | $ 0.9 |
DNA Enterprise Inc [Member] | |
Related Party Transaction [Line Items] | |
Revenue from related parties | $ 0.5 |