Cover Page
Cover Page - shares | 9 Months Ended | |
Oct. 01, 2023 | Nov. 06, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Oct. 01, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-11796 | |
Entity Registrant Name | Masonite International Corporation | |
Entity Tax Identification Number | 98-0377314 | |
Entity Address, Address Line One | 2771 Rutherford Road | |
Entity Address, City or Town | Concord | |
Entity Address, State or Province | ON | |
Entity Address, Postal Zip Code | L4K 2N6 | |
Entity Address, Country | CA | |
City Area Code | 800 | |
Local Phone Number | 895-2723 | |
Title of 12(b) Security | Common Stock (no par value) | |
Trading Symbol | DOOR | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 21,905,829 | |
Entity Central Index Key | 0000893691 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Incorporation, State or Country Code | A1 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income and Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 01, 2023 | Oct. 02, 2022 | Oct. 01, 2023 | Oct. 02, 2022 | |
Statement of Comprehensive Income [Abstract] | ||||
Net sales | $ 702,247 | $ 727,626 | $ 2,170,115 | $ 2,215,717 |
Cost of goods sold | 536,548 | 560,442 | 1,655,558 | 1,684,799 |
Gross profit | 165,699 | 167,184 | 514,557 | 530,918 |
Selling, general and administration expenses | 98,625 | 82,690 | 299,076 | 256,266 |
Restructuring costs (benefit) | 1,900 | (141) | 8,643 | (221) |
Operating income | 65,174 | 84,635 | 206,838 | 274,873 |
Interest expense, net | 11,913 | 10,266 | 39,653 | 31,098 |
Other (income) expense, net | (1,083) | 211 | (1,581) | (1,604) |
Income before income tax expense | 54,344 | 74,158 | 168,766 | 245,379 |
Income tax expense | 12,041 | 16,376 | 38,074 | 59,502 |
Net income | 42,303 | 57,782 | 130,692 | 185,877 |
Less: net income attributable to non-controlling interests | 817 | 745 | 2,470 | 2,743 |
Net income attributable to Masonite | $ 41,486 | $ 57,037 | $ 128,222 | $ 183,134 |
Basic earnings per common share attributable to Masonite (in dollars per share) | $ 1.89 | $ 2.56 | $ 5.81 | $ 8.09 |
Diluted earnings per common share attributable to Masonite (in dollars per share) | $ 1.86 | $ 2.54 | $ 5.73 | $ 8.01 |
Comprehensive income: | ||||
Net income | $ 42,303 | $ 57,782 | $ 130,692 | $ 185,877 |
Other comprehensive (loss) income: | ||||
Foreign currency translation (loss) gain | (9,837) | (29,021) | 7,653 | (59,518) |
Amortization of actuarial net losses | 191 | 6 | 574 | 18 |
Income tax expense related to other comprehensive income (loss) | (57) | (45) | (131) | (58) |
Other comprehensive (loss) income, net of tax | (9,703) | (29,060) | 8,096 | (59,558) |
Comprehensive income | 32,600 | 28,722 | 138,788 | 126,319 |
Less: comprehensive income attributable to non-controlling interests | 734 | 700 | 2,543 | 3,339 |
Comprehensive income attributable to Masonite | $ 31,866 | $ 28,022 | $ 136,245 | $ 122,980 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Oct. 01, 2023 | Jan. 01, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 360,482 | $ 296,922 |
Restricted cash | 11,926 | 11,999 |
Accounts receivable, net | 354,995 | 375,918 |
Inventories, net | 364,181 | 406,828 |
Prepaid expenses and other assets | 65,305 | 55,051 |
Income taxes receivable | 24,703 | 16,922 |
Total current assets | 1,181,592 | 1,163,640 |
Property, plant and equipment, net | 734,567 | 652,329 |
Operating lease right-of-use assets | 190,840 | 160,695 |
Investment in equity investees | 19,366 | 16,111 |
Goodwill | 253,871 | 69,868 |
Intangible assets, net | 247,763 | 136,056 |
Deferred income taxes | 23,401 | 16,133 |
Other assets | 34,506 | 33,346 |
Total assets | 2,685,906 | 2,248,178 |
Current liabilities: | ||
Accounts payable | 140,310 | 111,526 |
Accrued expenses | 213,920 | 223,046 |
Income taxes payable | 6,728 | 14,361 |
Long-Term Debt, Current Maturities | 37,500 | 0 |
Total current liabilities | 398,458 | 348,933 |
Long-term debt | 1,058,210 | 866,116 |
Long-term operating lease liabilities | 178,009 | 151,242 |
Deferred income taxes | 118,394 | 79,590 |
Other liabilities | 76,116 | 59,515 |
Total liabilities | 1,829,187 | 1,505,396 |
Commitments and Contingencies (Note 7) | ||
Equity: | ||
Share capital: unlimited shares authorized, no par value, 21,903,821 and 22,155,035 shares issued and outstanding as of October 1, 2023, and January 1, 2023, respectively | 525,709 | 520,003 |
Additional paid-in capital | 226,950 | 226,514 |
Retained earnings | 227,298 | 127,826 |
Accumulated other comprehensive loss | (134,201) | (142,224) |
Total equity attributable to Masonite | 845,756 | 732,119 |
Equity attributable to non-controlling interests | 10,963 | 10,663 |
Total equity | 856,719 | 742,782 |
Total liabilities and equity | $ 2,685,906 | $ 2,248,178 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - shares | Oct. 01, 2023 | Jan. 01, 2023 |
Statement of Financial Position [Abstract] | ||
Shares issued (in shares) | 21,903,821 | 22,155,035 |
Shares outstanding (in shares) | 21,903,821 | 22,155,035 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Changes in Equity (Unaudited) - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Equity Attributable to Noncontrolling Interests |
Balance at beginning of period at Jan. 02, 2022 | $ 699,778 | $ 543,400 | $ 222,177 | $ 24,244 | $ (101,582) | $ 11,539 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Common shares issued for delivery of share based awards | 13,531 | (13,531) | ||||
Common shares issued under employee stock purchase plan | 1,574 | (207) | ||||
Common shares repurchased | 35,930 | 104,070 | ||||
Share based compensation expense | 16,251 | |||||
Common shares withheld to cover income taxes payable due to delivery of share based awards | (3,332) | |||||
Net income | 185,877 | 183,134 | 2,743 | |||
Other comprehensive income (loss), net of tax | (59,558) | (60,154) | 596 | |||
Dividends to non-controlling interests | (3,744) | |||||
Balance at end of period at Oct. 02, 2022 | 696,639 | $ 522,575 | 221,358 | 103,308 | (161,736) | 11,134 |
Balance at beginning of period (in shares) at Jan. 02, 2022 | 23,623,887 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Common shares issued for delivery of share based awards (in shares) | 191,166 | |||||
Common shares issued under employee stock purchase plan (in shares) | 16,567 | |||||
Common shares repurchased (in shares) | (1,556,008) | |||||
Balance at end of period (in shares) at Oct. 02, 2022 | 22,275,612 | |||||
Balance at beginning of period at Jul. 03, 2022 | 663,065 | $ 521,243 | 216,653 | 46,271 | (132,721) | 11,619 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Common shares issued for delivery of share based awards | 555 | (555) | ||||
Common shares issued under employee stock purchase plan | 777 | (73) | ||||
Common shares repurchased | 0 | 0 | ||||
Share based compensation expense | 5,556 | |||||
Common shares withheld to cover income taxes payable due to delivery of share based awards | (223) | |||||
Net income | 57,782 | 57,037 | 745 | |||
Other comprehensive income (loss), net of tax | (29,060) | (29,015) | (45) | |||
Dividends to non-controlling interests | (1,185) | |||||
Balance at end of period at Oct. 02, 2022 | 696,639 | $ 522,575 | 221,358 | 103,308 | (161,736) | 11,134 |
Balance at beginning of period (in shares) at Jul. 03, 2022 | 22,259,356 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Common shares issued for delivery of share based awards (in shares) | 7,718 | |||||
Common shares issued under employee stock purchase plan (in shares) | 8,538 | |||||
Common shares repurchased (in shares) | 0 | |||||
Balance at end of period (in shares) at Oct. 02, 2022 | 22,275,612 | |||||
Balance at beginning of period at Jan. 01, 2023 | 742,782 | $ 520,003 | 226,514 | 127,826 | (142,224) | 10,663 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Common shares issued for delivery of share based awards | 14,434 | (14,434) | ||||
Common shares issued under employee stock purchase plan | 1,654 | (312) | ||||
Common shares repurchased | 10,382 | 28,750 | ||||
Share based compensation expense | 17,439 | |||||
Common shares withheld to cover income taxes payable due to delivery of share based awards | (2,257) | |||||
Net income | 130,692 | 128,222 | 2,470 | |||
Other comprehensive income (loss), net of tax | 8,096 | 8,023 | 73 | |||
Dividends to non-controlling interests | (2,243) | |||||
Balance at end of period at Oct. 01, 2023 | $ 856,719 | $ 525,709 | 226,950 | 227,298 | (134,201) | 10,963 |
Balance at beginning of period (in shares) at Jan. 01, 2023 | 22,155,035 | 22,155,035 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Common shares issued for delivery of share based awards (in shares) | 165,313 | |||||
Common shares issued under employee stock purchase plan (in shares) | 17,470 | |||||
Common shares repurchased (in shares) | (433,997) | |||||
Balance at end of period (in shares) at Oct. 01, 2023 | 21,903,821 | 21,903,821 | ||||
Balance at beginning of period at Jul. 02, 2023 | $ 829,825 | $ 526,816 | 223,540 | 193,262 | (124,581) | 10,788 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Common shares issued for delivery of share based awards | 594 | (594) | ||||
Common shares issued under employee stock purchase plan | 848 | (86) | ||||
Common shares repurchased | 2,549 | 7,450 | ||||
Share based compensation expense | 4,282 | |||||
Common shares withheld to cover income taxes payable due to delivery of share based awards | (192) | |||||
Net income | 42,303 | 41,486 | 817 | |||
Other comprehensive income (loss), net of tax | (9,703) | (9,620) | (83) | |||
Dividends to non-controlling interests | (559) | |||||
Balance at end of period at Oct. 01, 2023 | $ 856,719 | $ 525,709 | $ 226,950 | $ 227,298 | $ (134,201) | $ 10,963 |
Balance at beginning of period (in shares) at Jul. 02, 2023 | 21,995,420 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Common shares issued for delivery of share based awards (in shares) | 6,193 | |||||
Common shares issued under employee stock purchase plan (in shares) | 8,537 | |||||
Common shares repurchased (in shares) | (106,329) | |||||
Balance at end of period (in shares) at Oct. 01, 2023 | 21,903,821 | 21,903,821 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Oct. 01, 2023 | Oct. 02, 2022 | |
Cash flows from operating activities: | ||
Net income | $ 130,692 | $ 185,877 |
Adjustments to reconcile net income to net cash flow provided by operating activities: | ||
Depreciation | 67,355 | 51,977 |
Amortization | 21,915 | 13,164 |
Share based compensation expense | 17,439 | 16,251 |
Deferred income taxes | (13,618) | (4,675) |
Unrealized foreign exchange (gain) loss | (312) | 859 |
Share of income from equity investees, net of tax | (3,186) | (3,944) |
Dividend from equity investee | 3,150 | 4,500 |
Pension and post-retirement funding, net of expense | (1,446) | 140 |
Non-cash accruals and interest | 3,384 | 199 |
Loss (gain) on sale of property, plant and equipment | 3,319 | (1,245) |
Changes in assets and liabilities, net of acquisitions: | ||
Accounts receivable | 30,972 | (70,530) |
Inventories | 88,087 | (101,305) |
Prepaid expenses and other assets | (20,714) | 85 |
Accounts payable and accrued expenses | 1,512 | (3,307) |
Other assets and liabilities | (18,138) | (5,127) |
Net cash flow provided by operating activities | 310,411 | 82,919 |
Cash flows from investing activities: | ||
Additions to property, plant and equipment | (86,172) | (65,792) |
Acquisition of businesses, net of cash acquired | (352,886) | 0 |
Proceeds from sale of property, plant and equipment | 56 | 6,393 |
Proceeds from repayment of note receivable | 12,000 | 0 |
Other investing activities | (5,886) | (2,068) |
Net cash flow used in investing activities | (432,888) | (61,467) |
Cash flows from financing activities: | ||
Proceeds from issuance of long-term debt | 250,000 | 0 |
Repayments of Long-term Debt | 18,750 | 0 |
Payment of debt issuance costs | (3,628) | 0 |
Proceeds from borrowings on revolving credit facilities | 100,000 | 0 |
Repayments of borrowings on revolving credit facilities | (100,000) | 0 |
Tax withholding on share based awards | (2,257) | (3,332) |
Distributions to non-controlling interests | (2,243) | (2,500) |
Repurchases of common shares | (39,132) | (140,000) |
Net cash flow provided by (used in) financing activities | 183,990 | (145,832) |
Net foreign currency translation adjustment on cash | 1,974 | (4,421) |
Increase (decrease) in cash, cash equivalents and restricted cash | 63,487 | (128,801) |
Cash, cash equivalents and restricted cash, beginning of period | 308,921 | 391,505 |
Cash, cash equivalents and restricted cash, at end of period | $ 372,408 | $ 262,704 |
Business Overview and Significa
Business Overview and Significant Accounting Policies | 9 Months Ended |
Oct. 01, 2023 | |
Accounting Policies [Abstract] | |
Business Overview and Significant Accounting Policies | Business Overview and Significant Accounting Policies Unless we state otherwise or the context otherwise requires, references to "Masonite," "we," "our," "us" and the "Company" in these notes to the condensed consolidated financial statements refer to Masonite International Corporation and its subsidiaries. Description of Business Masonite International Corporation is a leading global designer, manufacturer, marketer and distributor of interior and exterior doors, door system components and door systems for the new construction and repair, renovation and remodeling sectors of the residential and non-residential building construction markets. Masonite operates 63 manufacturing locations in seven countries and sells doors to customers throughout the world with our largest markets being the United States, Canada and the United Kingdom. Basis of Presentation We prepare these unaudited condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States of America ("GAAP") and applicable rules and regulations of the U.S. Securities and Exchange Commission ("SEC") regarding interim financial reporting. Accordingly, they do not include all of the information and notes required by GAAP for annual financial statements. In the opinion of management, all adjustments consisting of normal and recurring entries considered necessary for a fair presentation of the results for the interim periods presented have been included. All significant intercompany balances and transactions have been eliminated. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect reported amounts in the financial statements and accompanying notes. These estimates are based on information available as of the date of the unaudited condensed consolidated financial statements; therefore, actual results could differ from those estimates. Interim results are not necessarily indicative of the results for a full year. These unaudited condensed consolidated financial statements should be read in conjunction with the Company's Annual Report on Form 10-K for the fiscal year ended January 1, 2023, as filed with the SEC (the "Annual Report"). Our fiscal year is the 52- or 53-week period ending on the Sunday closest to December 31. In a 52-week year, each fiscal quarter consists of 13 weeks. For ease of disclosure, the 13-week periods are referred to as three-month periods and the 52- or 53-week periods are referred to as a year. Changes in Accounting Standards and Policies There have been no changes in the significant accounting policies from those that were disclosed in the fiscal year 2022 audited consolidated financial statements, other than as noted below. Adoption of Recent Accounting Pronouncements In December 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2021-10, "Government Assistance," which requires annual disclosures that increase the transparency of transactions involving government grants, including (1) the types of transactions, (2) the accounting for those transactions and (3) the effect of those transactions on an entity's financial statements. The guidance is effective for annual periods beginning after December 15, 2021, with early adoption permitted. We adopted the new guidance as of January 3, 2022, the beginning of fiscal year 2022, and the adoption did not have a material impact on our financial statements. In October 2021, the FASB issued ASU 2021-08, "Accounting for Contract Assets and Contract Liabilities from Contracts with Customers," which clarifies that an acquirer of a business should recognize and measure contract assets and contract liabilities in a business combination in accordance with ASU 2014-09, "Revenue from Contracts with Customers" as if the entity had originated the contracts. We adopted the new guidance as of January 1, 2023, the beginning of fiscal year 2023, and the adoption did not have a material impact on our financial statements. |
Acquisitions and Divestitures
Acquisitions and Divestitures | 9 Months Ended |
Oct. 01, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisitions and Divestitures | Acquisitions and Divestitures Acquisitions On January 3, 2023, we completed the acquisition of 100% of the outstanding equity of EPI Holdings, Inc. ("Endura"), for total consideration of approximately$403.3 million, including an $18.0 million holdback which is payable 24 months after the acquisition date and was recorded in the consolidated balance sheets as a component of other liabilities. Endura is a leading innovator and manufacturer of high-performance door frames and door system components in the United States. Endura’s product offerings include engineered frames, self-adjusting sill systems, weather sealing, multi-point locks and installation accessories used by builders and contractors in residential new construction as well as repair and remodeling applications. The acquisition is intended to accelerate our Doors That Do More TM strategy and maximize our growth potential. The $182.9 million excess purchase price over the fair value of tangible and intangible assets acquired was allocated to goodwill. The goodwill principally represents anticipated synergies to be gained from the integration into our existing business and acquisition of the assembled workforce. This goodwill is not deductible for tax purposes and relates to the North American Residential segment. The Company has accounted for the acquisition as a business combination and allocated the preliminary estimated purchase price to the estimated fair values of assets acquired and liabilities assumed utilizing various valuation methods including replacement cost, market values and the income approach. The Company has not yet completed its evaluation and determination of certain assets acquired and liabilities assumed, primarily (i) the final valuation of intangible assets related to customers relationships, patents and trade names, and (ii) the final assessment and valuation of certain other assets acquired and liabilities assumed, including inventory, property, plant and equipment, leases, and deferred income taxes, which could also impact goodwill during the measurement period. The allocation of the purchase price to assets acquired and liabilities assumed is as follows: (In thousands) Initial Purchase Price Allocation Measurement Period Adjustments Preliminary Purchase Price Allocation Cash acquired $ 32,501 $ (100) $ 32,401 Accounts receivable, net 7,871 290 8,161 Inventories, net 44,183 35 44,218 Property, plant and equipment, net 54,373 10,576 64,949 Goodwill 189,938 (7,044) 182,894 Intangible assets 135,800 (7,400) 128,400 Accounts payable and accrued expenses (15,088) (190) (15,278) Deferred income taxes (44,345) (946) (45,291) Other assets and liabilities, net 2,868 (35) 2,833 Total purchase price $ 408,101 $ (4,814) $ 403,287 The fair values of intangible assets acquired are based on management's estimates and assumptions including the income approach, the cost approach and the market approach. The intangible assets acquired are not expected to have any residual value. The gross contractual value of acquired trade receivables was $8.3 million. Intangible assets acquired from the Endura acquisition consist of the following: Fair Value Expected Useful Life (Years) Customer relationships $ 108,600 10 Trademarks and trade names 6,600 10 Patents 13,200 12 Total intangible assets acquired $ 128,400 Endura's results of operations were included in the condensed consolidated statements of income and comprehensive income for the period subsequent to the acquisition date. For the three and nine months ended October 1, 2023, Endura had net sales of $59.7 million and $178.9 million, respectively. For the three and nine months ended October 1, 2023, Endura had $1.7 million in net income attributable to Masonite and $1.5 million in net loss attributable to Masonite, respectively. Pro Forma Information The following unaudited pro forma financial information represents the consolidated financial information as if the Endura acquisition had been included in our consolidated results beginning on January 2, 2022, the first day of the fiscal year prior to the respective acquisition date. The pro forma results have been calculated after adjusting the results of the acquired entities to remove intercompany transactions and to reflect the additional depreciation, amortization and interest expense that would have been charged assuming the fair value adjustments to property, plant and equipment and intangible assets and the additional debt incurred to fund the acquisition had been applied on the first day of the fiscal year prior to the respective acquisition date, together with the consequential tax effects. The pro forma results do not reflect any cost savings, operating synergies or revenue enhancements that the combined companies may achieve as a result of the acquisition; the costs to combine the companies' operations; or the costs necessary to achieve these costs savings, operating synergies and revenue enhancements. As a result, the pro forma information below does not purport to represent actual results had the acquisition been consummated on the date indicated and it is not necessarily indicative of future results of operations. Three Months Ended October 2, 2022 (In thousands, except per share amounts) Masonite Endura Pro Forma Adjustments Pro Forma Net sales $ 727,626 $ 67,950 $ 2,942 $ 798,518 Net income attributable to Masonite 57,037 1,775 (9,832) 48,980 Basic earnings per common share $ 2.56 $ 2.20 Diluted earnings per common share $ 2.54 $ 2.18 Nine Months Ended October 2, 2022 (In thousands, except per share amounts) Masonite Endura Pro Forma Adjustments Pro Forma Net sales $ 2,215,717 $ 214,145 $ (2,878) $ 2,426,984 Net income attributable to Masonite 183,134 9,225 (23,563) 168,796 Basic earnings per common share $ 8.09 $ 7.46 Diluted earnings per common share $ 8.01 $ 7.38 As previously disclosed, we are actively reviewing strategic alternatives for our Architectural segment, including a potential sale of some or all of the business. There can be no assurance that a potential transaction will be |
Accounts Receivable
Accounts Receivable | 9 Months Ended |
Oct. 01, 2023 | |
Receivables [Abstract] | |
Accounts Receivable | Accounts Receivable Our customers consist mainly of retailers, distributors and contractors. Our ten largest customers accounted for 59.4% and 62.3% of total accounts receivable as of October 1, 2023, and January 1, 2023, respectively. Our largest customer, The Home Depot, Inc., accounted for more than 10% of the consolidated gross accounts receivable balance as of October 1, 2023, and January 1, 2023. In addition, Lowe's Companies, Inc. accounted for more than 10% of the consolidated gross accounts receivable balance as of October 1, 2023. The allowance for doubtful accounts balance was $2.9 million and $2.5 million as of October 1, 2023, and January 1, 2023, respectively. We maintain an accounts receivable sales program with a third party (the "AR Sales Program"). Under the AR Sales Program, we can transfer ownership of eligible trade accounts receivable of certain customers. Receivables are sold outright to a third party who assumes the full risk of collection, without recourse to us in the event of a loss. Transfers of receivables under this AR Sales Program are accounted for as sales. Proceeds from the transfers reflect the face value of the accounts receivable less a discount. Receivables sold under the AR Sales Program are excluded from trade accounts receivable in the condensed consolidated balance sheets and are included in cash flows from operating activities in the condensed consolidated statements of cash flows. The discounts on the sales of trade accounts receivable sold, if any, under the AR Sales Program were not material for any of the periods presented and were recorded in selling, general and administration expenses within the condensed consolidated statements of income and comprehensive income. In most countries we pay and collect Value Added Tax ("VAT") when procuring goods and services within the normal course of business. VAT receivables are established in jurisdictions where VAT paid exceeds VAT collected and are recoverable through the filing of refund claims. |
Inventories
Inventories | 9 Months Ended |
Oct. 01, 2023 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories The amounts of inventory on hand were as follows as of the dates indicated: (In thousands) October 1, 2023 January 1, 2023 Raw materials $ 241,455 $ 320,553 Finished goods 138,129 95,005 Provision for obsolete or aged inventory (15,403) (8,730) Inventories, net $ 364,181 $ 406,828 |
Accrued Expenses
Accrued Expenses | 9 Months Ended |
Oct. 01, 2023 | |
Accrued Expenses [Abstract] | |
Accrued Expenses | Accrued Expenses The details of our accrued expenses were as follows as of the dates indicated: (In thousands) October 1, 2023 January 1, 2023 Accrued payroll $ 70,059 $ 69,224 Accrued rebates 54,976 50,200 Current portion of operating lease liabilities 27,554 24,372 Accrued interest 9,477 16,480 Other accruals 51,854 62,770 Total accrued expenses $ 213,920 $ 223,046 |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Oct. 01, 2023 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt (In thousands) October 1, 2023 January 1, 2023 Senior unsecured notes, interest rate of 3.50% , due 2030 $ 375,000 $ 375,000 Senior unsecured notes, interest rate of 5.375% , due 2028 500,000 500,000 Term Loan Facility, interest rate of SOFR plus 2.25%, due 2027 231,250 — Debt issuance costs (10,540) (8,884) Total debt (including current portion) 1,095,710 866,116 Less: debt due within one year (37,500) — Total long-term debt (excluding current portion) $ 1,058,210 $ 866,116 Interest expense related to our consolidated indebtedness under our senior unsecured notes, Term Loan Facility and ABL Facility was $13.5 million and $43.0 million for the three and nine months ended October 1, 2023, respectively, and $10.4 million and $31.1 million for the three and nine months ended October 2, 2022, respectively. 3.50% Senior Notes due 2030 On July 26, 2021, we issued $375.0 million aggregate principal senior unsecured notes (the "2030 Notes"). The 2030 Notes bear interest at 3.50% per annum, payable in cash semiannually in arrears on February 15 and August 15 of each year and are due February 15, 2030. The 2030 Notes were issued at par. Information concerning obligations under the 2030 Notes and the indenture governing them are described in detail in our Annual Report. As of October 1, 2023, we were in compliance with all covenants under the indenture governing the 2030 Notes. 5.375% Senior Notes due 2028 On July 25, 2019, we issued $500.0 million aggregate principal senior unsecured notes (the "2028 Notes"). The 2028 Notes bear interest at 5.375%, payable in cash semiannually in arrears on February 1 and August 1 of each year and are due February 1, 2028. The 2028 Notes were issued at par. Information concerning obligations under the 2028 Notes and the indenture governing them are described in detail in our Annual Report. As of October 1, 2023, we were in compliance with all covenants under the indenture governing the 2028 Notes. Term Loan Facility On December 13, 2022, we and certain of our subsidiaries entered into a new delayed-draw term loan credit agreement (the "Term Loan Credit Agreement") maturing on December 12, 2027 (the "Term Loan Maturity Date"). The Term Loan Credit Agreement provides for a senior secured five-year delayed-draw term loan facility of $250.0 million (the "Term Loan Facility"). Loans under the Term Loan Facility (the "Term Loans") will bear interest at a rate equal to, at our option, (1) the Adjusted Term SOFR Rate (as defined in the Term Loan Credit Agreement) plus an applicable margin of 2.25% or (2) an alternate base rate equal to the greatest of (i) the "Prime Rate" in the U.S. last quoted by The Wall Street Journal, (ii) 0.50% above the greater of the federal funds rate and the rate comprised of both overnight federal funds and overnight Eurodollar transactions denominated in U.S. dollars, (iii) 1.00% above the Adjusted Term SOFR Rate for a one month interest period and (iv) 1.00%, plus, in each case, an applicable margin of 1.25%, subject to, in each of cases (1) and (2), an agreed interest rate floor. The Term Loans are repayable in equal quarterly installments for an annual aggregate amortization payment equal to 15% of the aggregate principal amount of the Term Loans, with the balance of the principal being due on the Term Loan Maturity Date. Obligations under the Term Loan Credit Agreement are fully and unconditionally guaranteed, jointly and severally, by us and by certain of our directly or indirectly wholly owned subsidiaries organized in the U.S. and are secured by the equity in, and substantially all the assets of, such subsidiaries. The Term Loans were funded in an amount of $250.0 million and applied to finance a portion of the consideration payable in connection with the consummation of the Endura acquisition on January 3, 2023. We received net proceeds of $246.4 million after deducting $3.6 million of debt issuance costs. The debt issuance costs were capitalized as a reduction to the carrying value of debt and are being accreted to interest expense over the term of the Term Loan using the effective interest method. The Term Loan Credit Agreement contains various customary representations, warranties by us and covenants that are described in detail in our Annual Report. As of October 1, 2023, we were in compliance with all covenants under the indenture governing the Term Loan Credit Agreement. ABL Facility On January 31, 2019, we and certain of our subsidiaries entered into a $250.0 million asset-based revolving credit facility (the "ABL Facility") maturing on January 31, 2024, which replaced the previous facility. On October 28, 2022, we and certain of our subsidiaries entered into an amendment which, among other things, (i) increased the revolving credit commitments available thereunder by $100.0 million to an aggregate amount of $350.0 million and (ii) replaced the LIBOR-based interest rate applicable to borrowings thereunder in U.S. dollars with an interest rate based on the sum of (x) a "Term SOFR" rate published by the CME Group Benchmark Administration Limited (CBA) plus (y) 10 basis points ("Adjusted Term SOFR"). Additionally, on December 12, 2022, we entered into an amendment to the ABL Facility, which, among other things, extended the maturity of the ABL Facility from January 31, 2024 to December 12, 2027. The terms of the ABL Facility remained otherwise substantially unchanged and are described in detail in our Annual Report. On January 3, 2023, we borrowed $100.0 million under our ABL Facility in order to fund a portion of the cash consideration paid for the acquisition of Endura. During the first quarter of 2023, we repaid all amounts outstanding under the ABL Facility. The ABL Facility contains various customary representations, warranties by us and covenants that are described in detail in our Annual Report. As of October 1, 2023, we were in compliance with all covenants under the credit agreement governing the ABL Facility. We had availability of $276.0 million under our ABL Facility, and there were no amounts outstanding as of October 1, 2023. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Oct. 01, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies We may become involved from time-to-time in litigation and regulatory compliance matters incidental to our business, including employment and wage and hour claims, antitrust, tax, product liability, environmental, health and safety, commercial disputes, intellectual property, contracts and other matters arising out of the normal conduct of our business. Since litigation is inherently unpredictable and unfavorable resolutions can occur, assessing contingencies is highly subjective and requires judgments about future events. We regularly review and accrue for contingencies related to litigation and regulatory compliance matters, if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Based on current information, in the opinion of management, the ultimate resolution of these matters, individually or in the aggregate, will not have a material adverse effect on our financial condition, results of operations or cash flows. Antitrust Class Action Proceedings - Canada On May 19, 2020, an intended class proceeding was commenced in the Province of Québec, Canada naming as defendants Masonite Corporation, Corporation Internationale Masonite, JELD-WEN, Inc., JELD-WEN Holding, Inc. and JELD-WEN of Canada, Ltd. The plaintiff alleges that the Masonite and JELD-WEN defendants engaged in anticompetitive conduct, including price-fixing involving interior molded doors. The intended class proceeding seeks damages, punitive damages, and other relief. On December 22, 2020, the parties filed a motion with the court seeking to stay the proceeding. On October 2, 2020, an intended class proceeding was commenced in the Federal Court of Canada naming as defendants Masonite International Corporation, Masonite Corporation, JELD-WEN, Inc., JELD-WEN Holding, Inc. and JELD-WEN of Canada, Ltd. The plaintiff alleges that the Masonite and JELD-WEN defendants engaged in anticompetitive conduct, including price-fixing involving interior molded doors. The intended class proceeding seeks damages, punitive damages, and other relief. The plaintiff served its certification record on March 31, 2021. On November 3, 2023, the Company entered into a preliminary settlement agreement with the plaintiff class that would result in the resolution of all the plaintiffs’ underlying claims and lawsuits in exchange for a payment by the Company of approximately $0.9 million. As a result, for the three and nine months ended October 1, 2023, we accrued approximately $0.9 million in selling, general and administrative expense in the condensed consolidated statement of income and comprehensive income in connection with this matter. The preliminary settlement agreement is subject to court approval. A settlement approval hearing date has not yet been set. |
Share Based Compensation Plans
Share Based Compensation Plans | 9 Months Ended |
Oct. 01, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Share Based Compensation Plans | Share Based Compensation Plans Share based compensation expense was $4.3 million and $17.4 million for the three and nine months ended October 1, 2023, respectively, and $5.6 million and $16.3 million for the three and nine months ended October 2, 2022, respectively. As of October 1, 2023, the total remaining unrecognized compensation expense related to share based compensation amounted to $31.8 million, which will be amortized over the weighted average remaining requisite service period of 1.7 years. Equity Incentive Plans Our equity incentive plans under the 2021 Equity Plan and 2012 Plan are described in detail and defined in our Annual Report. The aggregate number of common shares that can be issued with respect to equity awards under the 2021 Equity Plan cannot exceed 880,000 shares; plus the number of shares reserved for the 2012 Plan that is in excess of the number of shares related to outstanding grants; plus the number of shares subject to existing grants under the 2012 Plan that may expire or be forfeited or cancelled. As of October 1, 2023, there were 766,368 shares of common stock available for future issuance under the 2021 Equity Plan. Deferred Compensation Plan We offer to certain of our employees and directors a Deferred Compensation Plan, which is further described and defined in our Annual Report. As of October 1, 2023, the liability and asset relating to deferred compensation had a fair value of $8.0 million and $7.3 million, respectively. As of October 1, 2023, participation in the deferred compensation plan is limited and no restricted stock awards have been deferred into the deferred compensation plan. All plan investments are categorized as having Level 1 valuation inputs as established by the FASB’s Fair Value Framework. Stock Appreciation Rights We have granted Stock Appreciation Rights ("SARs") to certain employees, which entitle the recipient to the appreciation in value of granted common shares over the exercise price over a period of time, each as specified in the applicable award agreement. The exercise price of any SAR granted may not be less than the fair market value of our common shares on the date of grant. The compensation expense for the SARs is measured based on the fair value of the SARs at the date of grant and is recognized over the requisite service period. The SARs vest over a maximum of three years, have a life of ten years and settle in common shares. It is assumed that all time-based SARs will vest. We recognize forfeitures of SARs in the period in which they occur. The total fair value of SARs vested was $0.7 million during the nine months ended October 1, 2023. Nine Months Ended October 1, 2023 Stock Appreciation Rights Aggregate Intrinsic Value (in thousands) Weighted Average Exercise Price Average Remaining Contractual Life (Years) Outstanding, beginning of period 184,205 $ 2,153 $ 74.75 7.0 Granted 30,946 88.99 Exercised — — — Cancelled and forfeited (4,465) 90.76 Outstanding, end of period 210,686 $ 3,870 $ 76.50 6.3 Exercisable, end of period 153,236 $ 3,648 $ 70.93 5.4 The value of SARs granted is determined using the Black-Scholes-Merton valuation model, and the corresponding expense is expected to be recognized over the average requisite service period of 2.0 years. Expected volatility is based upon the historical volatility of our common shares amongst other considerations. The expected term is calculated based upon historical employee exercise behavior and the contractual term of the SAR amongst other considerations. The weighted average grant date assumptions used for the SARs granted were as follows for the periods indicated: 2023 Grants SAR value (model conclusion) $ 32.63 Risk-free rate 4.1 % Expected dividend yield 0.0 % Expected volatility 28.4 % Expected term (years) 6.0 Restricted Stock Units We have granted Restricted Stock Units ("RSUs") to directors and certain employees under the 2021 Equity Plan and the 2012 Plan. The RSUs confer the right to receive shares of our common stock at a specified future date or when certain conditions are met. The compensation expense for the RSUs granted is based on the fair value of the RSUs at the date of grant, which is equal to the stock price on the date of grant and is recognized over the requisite service period. The RSUs vest over a maximum of three years and call for the underlying shares to be delivered no later than 30 days following the vesting date unless the participant is subject to a blackout period. In such case, the shares are to be delivered once the blackout restriction has been lifted. It is assumed that all time-based RSUs will vest. We recognize forfeitures of RSUs in the period in which they occur. Nine Months Ended October 1, 2023 Total Restricted Stock Units Outstanding Weighted Average Grant Date Fair Value Outstanding, beginning of period 313,753 $ 92.85 Granted 212,045 89.94 Delivered (103,072) 91.45 Withheld to cover (1) (20,600) Forfeited (38,200) 91.29 Outstanding, end of period 363,926 $ 91.79 ___________ (1) A portion of the vested RSUs delivered were net shares settled to cover statutory requirements for income and other employment taxes. We remit the equivalent cash to the appropriate taxing authorities. These net share settlements had the effect of share repurchases by us as we reduced and retired the number of shares that would have otherwise been issued as a result of the vesting. RSUs granted during the nine months ended October 1, 2023, vest at specified future dates with only service requirements. The value of RSUs granted in the nine months ended October 1, 2023, was $19.1 million and is being recognized over the weighted average requisite service period of 2.0 years. During the nine months ended October 1, 2023, 123,672 RSUs vested at a fair value of $11.3 million. Performance-based Restricted Stock Units We have granted certain Performance-based Restricted Stock Units ("PRSUs") under the 2021 Equity Plan and the 2012 Plan. These PRSUs are settled with payouts ranging from zero to 200% of the target award value depending on performance goal achievement. The compensation expense for the PRSUs awarded is based on the fair value of the PRSUs at the date of grant, which is equal to the stock price on the date of grant and is recognized over the requisite service period. The compensation expense for certain PRSUs is determined using the Monte Carlo simulation method. The PRSUs vest over a maximum of three years and call for the underlying shares to be delivered no later than 30 days following the vesting date unless the participant is subject to a blackout period. In such case, the shares are to be delivered once the blackout restriction has been lifted. Nine Months Ended October 1, 2023 Total Performance Restricted Stock Units Outstanding Weighted Average Grant Date Fair Value Outstanding, beginning of period 310,678 $ 90.15 Granted 92,743 104.36 Performance adjustment (1) 17,139 79.25 Delivered (63,432) 79.25 Withheld to cover (2) (5,224) Forfeited (30,376) 94.50 Outstanding, end of period 321,528 $ 95.58 ___________ (1) PRSUs are presented as outstanding, granted and forfeited in the table above assuming targets are met and the awards pay out at 100%. Certain awards are settled with payouts ranging from zero to 200% of the target award value depending on achievement. The performance adjustment represents the difference in shares ultimately awarded due to performance attainment above or below target. (2) A portion of the vested PRSUs delivered were net shares settled to cover statutory requirements for income and other employment taxes. We remit the equivalent cash to the appropriate taxing authorities. These net share settlements had the effect of share repurchases by us as we reduced and retired the number of shares that would have otherwise been issued as a result of the vesting. |
Restructuring Costs
Restructuring Costs | 9 Months Ended |
Oct. 01, 2023 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Costs | Restructuring Costs In December 2022, we began implementing a plan intended to improve overall business performance that includes the optimization of our manufacturing capacity and reduction of our overhead and selling, general and administration workforce primarily in our North American Residential reportable segment as well as actions in the Architectural reportable segment and in our head offices (collectively, the "2022 Plan"). The optimization of our manufacturing capacity involves specific plants in the North American Residential segment and costs associated with the closure of these plants and related headcount reductions. Costs associated with the 2022 Plan include severance and closure charges which continue throughout 2023. As of October 1, 2023, we expect to incur approximately $4 million to $9 million of additional charges related to the 2022 Plan. The following tables summarize the restructuring (benefit) costs recorded for the periods indicated: Three Months Ended October 1, 2023 (In thousands) North American Residential Architectural Corporate & Other Total 2022 Plan $ 1,898 $ — $ 2 $ 1,900 Total Restructuring Costs $ 1,898 $ — $ 2 $ 1,900 Three Months Ended October 2, 2022 (In thousands) North American Residential Architectural Corporate & Other Total Other $ (178) $ 23 $ 14 $ (141) Total Restructuring (Benefit) Costs $ (178) $ 23 $ 14 $ (141) Nine Months Ended October 1, 2023 (In thousands) North American Residential Architectural Corporate & Other Total 2022 Plan $ 7,153 $ 863 $ 627 $ 8,643 Total Restructuring (Benefit) Costs $ 7,153 $ 863 $ 627 $ 8,643 Nine Months Ended October 2, 2022 (In thousands) North American Residential Architectural Corporate & Other Total Other $ (359) $ 71 $ 67 $ (221) Total Restructuring (Benefit) Costs $ (359) $ 71 $ 67 $ (221) Cumulative Amount Incurred Through October 1, 2023 (In thousands) North American Residential Architectural Corporate & Other Total 2022 Plan $ 9,284 $ 863 $ 627 $ 10,774 Total Restructuring Costs $ 9,284 $ 863 $ 627 $ 10,774 The changes in the accrual for restructuring by activity were as follows for the periods indicated: (In thousands) January 1, Severance Closure Costs Cash Payments October 1, 2022 Plan $ — $ 5,552 $ 3,091 $ (8,098) $ 545 Total $ — $ 5,552 $ 3,091 $ (8,098) $ 545 |
Income Taxes
Income Taxes | 9 Months Ended |
Oct. 01, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The effective tax rate differs from the Canadian statutory rate of 26.13% primarily due to mix of earnings in foreign jurisdictions that are subject to tax rates which differ from the Canadian statutory rate. In addition, we recognized zero income tax benefit due to the exercise and delivery of share based awards during both the three and nine months ended October 1, 2023, compared to zero and $1.1 million of income tax benefit during the three and nine months ended October 2, 2022, respectively. On August 16, 2022, President Biden signed the Inflation Reduction Act of 2022 ("IRA") into law. The IRA includes several changes to existing tax law, including a minimum tax on adjusted financial statement income of applicable corporations and an excise tax on certain corporate stock buybacks. The tax provisions included in the IRA were generally effective beginning January 1, 2023, and no significant impact to the consolidated financial statements resulted from their adoption as of October 1, 2023. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Oct. 01, 2023 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Basic earnings per share ("EPS") is calculated by dividing earnings attributable to Masonite by the weighted average number of our common shares outstanding during the period. Diluted EPS is calculated by dividing earnings attributable to Masonite by the weighted average number of common shares plus the incremental number of shares issuable from non-vested and vested RSUs and SARs outstanding during the period. (In thousands, except share and per share information) Three Months Ended Nine Months Ended October 1, 2023 October 2, 2022 October 1, 2023 October 2, 2022 Net income attributable to Masonite $ 41,486 $ 57,037 $ 128,222 $ 183,134 Shares used in computing basic earnings per share 21,992,513 22,267,684 22,082,416 22,624,830 Effect of dilutive securities: Incremental shares issuable under share compensation plans 346,660 224,190 307,262 248,197 Shares used in computing diluted earnings per share 22,339,173 22,491,874 22,389,678 22,873,027 Basic earnings per common share attributable to Masonite $ 1.89 $ 2.56 $ 5.81 $ 8.09 Diluted earnings per common share attributable to Masonite $ 1.86 $ 2.54 $ 5.73 $ 8.01 Anti-dilutive instruments excluded from diluted earnings per common share 58,817 212,197 98,145 223,660 The weighted average number of shares outstanding utilized for the diluted EPS calculation contemplates the exercise of all currently outstanding SARs and the conversion of all RSUs. The dilutive effect of such equity awards is calculated based on the weighted average share price for each fiscal period using the treasury stock method. |
Segment Information
Segment Information | 9 Months Ended |
Oct. 01, 2023 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Our reportable segments are organized and managed principally by end market: North American Residential, Europe and Architectural. The Corporate & Other category includes unallocated corporate costs and the results of immaterial operating segments which were not aggregated into any reportable segment. In addition to similar economic characteristics, we also consider the following factors in determining the reportable segments: the nature of business activities, the management structure directly accountable to our chief operating decision maker for operating and administrative activities, availability of discrete financial information and information presented to the Board of Directors and investors. Our management reviews net sales and Adjusted EBITDA (as defined below) to evaluate segment performance and allocate resources. Net assets are not allocated to the reportable segments. Adjusted EBITDA is a non-GAAP financial measure which does not have a standardized meaning under GAAP and is unlikely to be comparable to similar measures used by other companies. Adjusted EBITDA should not be considered as an alternative to either net income or operating cash flows determined in accordance with GAAP. Adjusted EBITDA is defined as net income (loss) attributable to Masonite adjusted to exclude the following items, as applicable: • depreciation; • amortization; • share based compensation expense; • loss (gain) on disposal of property, plant and equipment; • registration and listing fees; • restructuring costs (benefit); • asset impairment; • loss (gain) on disposal of subsidiaries; • interest expense (income), net; • loss on extinguishment of debt; • other expense (income), net; • income tax expense (benefit); • other items; • loss (income) from discontinued operations, net of tax; and • net income (loss) attributable to non-controlling interest. This definition of Adjusted EBITDA differs from the definitions of EBITDA contained in the indentures governing the 2030 Notes and the 2028 Notes and the credit agreements governing the Term Loan Facility and the ABL Facility . Although Adjusted EBITDA is not a measure of financial condition or performance determined in accordance with GAAP, it is used to evaluate and compare the operating performance of our reportable segments and it is one of the primary measures used to determine employee incentive compensation. Intersegment sales are recorded using market prices. Certain information with respect to reportable segments is as follows for the periods indicated: Three Months Ended October 1, 2023 (In thousands) North American Residential Europe Architectural Corporate & Other Total Net sales $ 553,294 $ 64,813 $ 82,558 $ 4,066 $ 704,731 Intersegment sales (315) (254) (1,900) (15) (2,484) Net sales to external customers $ 552,979 $ 64,559 $ 80,658 $ 4,051 $ 702,247 Adjusted EBITDA $ 108,999 $ 3,698 $ 5,132 $ (10,593) $ 107,236 Three Months Ended October 2, 2022 (In thousands) North American Residential Europe Architectural Corporate & Other Total Net sales $ 579,908 $ 66,109 $ 82,388 $ 4,625 $ 733,030 Intersegment sales (468) (391) (4,545) — (5,404) Net sales to external customers $ 579,440 $ 65,718 $ 77,843 $ 4,625 $ 727,626 Adjusted EBITDA $ 115,092 $ 3,898 $ (219) $ (6,849) $ 111,922 Nine Months Ended October 1, 2023 (In thousands) North American Residential Europe Architectural Corporate & Other Total Net sales $ 1,708,145 $ 194,761 $ 267,751 $ 12,502 $ 2,183,159 Intersegment sales (1,158) (498) (11,373) (15) (13,044) Net sales to external customers $ 1,706,987 $ 194,263 $ 256,378 $ 12,487 $ 2,170,115 Adjusted EBITDA $ 334,451 $ 11,540 $ 17,768 $ (31,901) $ 331,858 Nine Months Ended October 2, 2022 (In thousands) North American Residential Europe Architectural Corporate & Other Total Net sales $ 1,757,820 $ 222,120 $ 236,941 $ 15,641 $ 2,232,522 Intersegment sales (2,040) (2,081) (12,684) — (16,805) Net sales to external customers $ 1,755,780 $ 220,039 $ 224,257 $ 15,641 $ 2,215,717 Adjusted EBITDA $ 367,733 $ 24,307 $ (3,039) $ (34,202) $ 354,799 A reconciliation of our net income attributable to Masonite to consolidated Adjusted EBITDA is set forth as follows for the periods indicated: Three Months Ended Nine Months Ended (In thousands) October 1, 2023 October 2, 2022 October 1, 2023 October 2, 2022 Net income attributable to Masonite $ 41,486 $ 57,037 $ 128,222 $ 183,134 Plus: Depreciation 22,889 17,461 67,355 51,977 Amortization 7,452 4,256 21,915 13,164 Share based compensation expense 4,282 5,556 17,439 16,251 Loss (gain) on disposal of property, plant and equipment 1,779 155 3,319 (1,245) Restructuring costs (benefit) 1,900 (141) 8,643 (221) Interest expense, net 11,913 10,266 39,653 31,098 Other (income) expense, net (1,083) 211 (1,581) (1,604) Income tax expense 12,041 16,376 38,074 59,502 Other items (1) 3,760 — 6,349 — Net income attributable to non-controlling interest 817 745 2,470 2,743 Adjusted EBITDA $ 107,236 $ 111,922 $ 331,858 $ 354,799 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss and Other Comprehensive (Loss) Income | 9 Months Ended |
Oct. 01, 2023 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Loss and Other Comprehensive (Loss) Income | Accumulated Other Comprehensive Loss and Other Comprehensive (Loss) Income A rollforward of the components of accumulated other comprehensive loss is as follows for the periods indicated: Three Months Ended Nine Months Ended (In thousands) October 1, 2023 October 2, 2022 October 1, 2023 October 2, 2022 Accumulated foreign currency translation losses, beginning of period $ (114,657) $ (128,070) $ (132,001) $ (96,919) Foreign currency translation (loss) gain (9,837) (29,021) 7,653 (59,518) Income tax (benefit) expense on foreign currency translation loss (6) (45) 4 (58) Less: foreign currency translation (loss) gain attributable to non-controlling interest (83) (45) 73 596 Accumulated foreign currency translation losses, end of period (124,417) (157,091) (124,417) (157,091) Accumulated pension and other post-retirement adjustments, beginning of period (9,924) (4,651) (10,223) (4,663) Amortization of actuarial net losses 191 6 574 18 Income tax expense on amortization of actuarial net losses (51) — (135) — Accumulated pension and other post-retirement adjustments (9,784) (4,645) (9,784) (4,645) Accumulated other comprehensive loss $ (134,201) $ (161,736) $ (134,201) $ (161,736) Other comprehensive (loss) income, net of tax $ (9,703) $ (29,060) $ 8,096 $ (59,558) Less: other comprehensive (loss) income attributable to non-controlling interest (83) (45) 73 596 Other comprehensive (loss) income attributable to Masonite $ (9,620) $ (29,015) $ 8,023 $ (60,154) Cumulative translation adjustments are reclassified out of accumulated other comprehensive loss into loss on disposal of subsidiaries in the condensed consolidated statements of income and comprehensive income. Actuarial net losses are reclassified out of accumulated other comprehensive loss into cost of goods sold in the condensed consolidated statements of income and comprehensive income. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 9 Months Ended |
Oct. 01, 2023 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Information | Supplemental Cash Flow Information Certain cash and non-cash transactions were as follows for the periods indicated: Nine Months Ended (In thousands) October 1, 2023 October 2, 2022 Transactions involving cash: Interest paid $ 52,336 $ 40,650 Interest received 8,543 1,032 Income taxes paid 67,846 67,841 Income tax refunds 3,781 1,576 Cash paid for operating lease liabilities 28,963 24,526 Cash paid for finance lease liabilities 1,060 1,005 Non-cash transactions: Right-of-use assets acquired under operating leases 69,301 4,694 Holdback of portion of Endura purchase payable 18,000 — The following reconciles total cash, cash equivalents and restricted cash as of the dates indicated: October 1, 2023 January 1, 2023 Cash and cash equivalents $ 360,482 $ 296,922 Restricted cash 11,926 11,999 Total cash, cash equivalents and restricted cash $ 372,408 $ 308,921 Property, plant and equipment additions in accounts payable were $10.2 million and $10.4 million as of October 1, 2023, and January 1, 2023, respectively. During the fourth quarter of 2018, we provided debt financing to a distribution company via an interest-bearing note that was scheduled to mature in 2028. The interest-bearing note receivable was carried at amortized cost, with the interest payable in kind at the election of the borrower. The note receivable balance was $12.6 million as of January 1, 2023, and was recorded in the consolidated balance sheets as a component of prepaid expenses and other assets. On January 26, 2023, the note receivable was redeemed and fully repaid. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Oct. 01, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying amounts of our cash and cash equivalents, restricted cash, accounts receivable, income taxes receivable, accounts payable, accrued expenses and income taxes payable approximate fair value because of the short-term maturity of those instruments. The carrying amount of our Term Loan Facility approximates fair value as the interest rates are variable and reflective of market rates. The estimated fair values and carrying values of our long-term senior note debt instruments were as follows for the periods indicated: October 1, 2023 January 1, 2023 (In thousands) Fair Value Carrying Value Fair Value Carrying Value 3.50% senior unsecured notes due 2030 $ 305,340 $ 371,542 $ 303,870 $ 371,136 5.375% senior unsecured notes due 2028 $ 465,950 $ 496,424 $ 462,495 $ 495,868 These estimates are based on market quotes and calculations based on current market rates available to us and are categorized as having Level 2 valuation inputs as established by the FASB's Fair Value Framework. Market quotes used in these calculations are based on bid prices for our debt instruments and are obtained from and corroborated with multiple independent sources. The market quotes obtained from independent sources are within the range of management's expectations. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Oct. 01, 2023 | |
Subsequent Event Abstract [Abstract] | |
Subsequent Event | Subsequent Event Acquisition of Fleetwood On October 19, 2023, the Company completed the acquisition of all of the issued and outstanding limited liability company interests of Fleetwood Aluminum Products, LLC (“Fleetwood”), for $285 million in cash. The Company held back approximately $26 million from the Base Purchase Price to secure the obligations of Sellers to Buyer with respect to any purchase price adjustment and indemnification claims. The total consideration was funded with a combination of cash on hand and borrowings under the ABL facility. Fleetwood is a leading designer and manufacturer of premium, aluminum-framed glass door and window solutions for luxury homes. Their products include multi-slide and pocket glass patio doors, pivot and hinged glass entry doors and folding glass door wall systems, as well as accompanying premium window products. The acquisition aligns with the Doors That Do More TM strategy focused on bringing differentiated door systems to the residential market. The acquisition will be accounted for as a business combination, with the goodwill being non-deductible for tax purposes. The allocation of the purchase price to the underlying assets acquired and liabilities assumed is subject to a formal valuation process, which has not yet been completed. The major classes of assets acquired will include trade receivables, inventories, trade payables and goodwill and intangibles. Our 2023 operating results will include the results from Fleetwood from the date of acquisition. Based on the timing of the acquisition and lack of available information, we determined it to be impracticable to disclose a preliminary purchase price allocation at this time. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 01, 2023 | Oct. 02, 2022 | Oct. 01, 2023 | Oct. 02, 2022 | |
Pay vs Performance Disclosure | ||||
Net income attributable to Masonite | $ 41,486 | $ 57,037 | $ 128,222 | $ 183,134 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Oct. 01, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Business Overview and Signifi_2
Business Overview and Significant Accounting Policies (Policies) | 9 Months Ended |
Oct. 01, 2023 | |
Accounting Policies [Abstract] | |
Adoption of Recent Accounting Pronouncements | Adoption of Recent Accounting Pronouncements In December 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2021-10, "Government Assistance," which requires annual disclosures that increase the transparency of transactions involving government grants, including (1) the types of transactions, (2) the accounting for those transactions and (3) the effect of those transactions on an entity's financial statements. The guidance is effective for annual periods beginning after December 15, 2021, with early adoption permitted. We adopted the new guidance as of January 3, 2022, the beginning of fiscal year 2022, and the adoption did not have a material impact on our financial statements. In October 2021, the FASB issued ASU 2021-08, "Accounting for Contract Assets and Contract Liabilities from Contracts with Customers," which clarifies that an acquirer of a business should recognize and measure contract assets and contract liabilities in a business combination in accordance with ASU 2014-09, "Revenue from Contracts with Customers" as if the entity had originated the contracts. We adopted the new guidance as of January 1, 2023, the beginning of fiscal year 2023, and the adoption did not have a material impact on our financial statements. |
Acquisitions and Divestitures (
Acquisitions and Divestitures (Tables) | 9 Months Ended |
Oct. 01, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The allocation of the purchase price to assets acquired and liabilities assumed is as follows: (In thousands) Initial Purchase Price Allocation Measurement Period Adjustments Preliminary Purchase Price Allocation Cash acquired $ 32,501 $ (100) $ 32,401 Accounts receivable, net 7,871 290 8,161 Inventories, net 44,183 35 44,218 Property, plant and equipment, net 54,373 10,576 64,949 Goodwill 189,938 (7,044) 182,894 Intangible assets 135,800 (7,400) 128,400 Accounts payable and accrued expenses (15,088) (190) (15,278) Deferred income taxes (44,345) (946) (45,291) Other assets and liabilities, net 2,868 (35) 2,833 Total purchase price $ 408,101 $ (4,814) $ 403,287 |
Schedule of Finite-Lived Intangible Assets | Intangible assets acquired from the Endura acquisition consist of the following: Fair Value Expected Useful Life (Years) Customer relationships $ 108,600 10 Trademarks and trade names 6,600 10 Patents 13,200 12 Total intangible assets acquired $ 128,400 |
Schedule of Pro Forma Information | The following unaudited pro forma financial information represents the consolidated financial information as if the Endura acquisition had been included in our consolidated results beginning on January 2, 2022, the first day of the fiscal year prior to the respective acquisition date. The pro forma results have been calculated after adjusting the results of the acquired entities to remove intercompany transactions and to reflect the additional depreciation, amortization and interest expense that would have been charged assuming the fair value adjustments to property, plant and equipment and intangible assets and the additional debt incurred to fund the acquisition had been applied on the first day of the fiscal year prior to the respective acquisition date, together with the consequential tax effects. The pro forma results do not reflect any cost savings, operating synergies or revenue enhancements that the combined companies may achieve as a result of the acquisition; the costs to combine the companies' operations; or the costs necessary to achieve these costs savings, operating synergies and revenue enhancements. As a result, the pro forma information below does not purport to represent actual results had the acquisition been consummated on the date indicated and it is not necessarily indicative of future results of operations. Three Months Ended October 2, 2022 (In thousands, except per share amounts) Masonite Endura Pro Forma Adjustments Pro Forma Net sales $ 727,626 $ 67,950 $ 2,942 $ 798,518 Net income attributable to Masonite 57,037 1,775 (9,832) 48,980 Basic earnings per common share $ 2.56 $ 2.20 Diluted earnings per common share $ 2.54 $ 2.18 Nine Months Ended October 2, 2022 (In thousands, except per share amounts) Masonite Endura Pro Forma Adjustments Pro Forma Net sales $ 2,215,717 $ 214,145 $ (2,878) $ 2,426,984 Net income attributable to Masonite 183,134 9,225 (23,563) 168,796 Basic earnings per common share $ 8.09 $ 7.46 Diluted earnings per common share $ 8.01 $ 7.38 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Oct. 01, 2023 | |
Inventory Disclosure [Abstract] | |
Inventories | The amounts of inventory on hand were as follows as of the dates indicated: (In thousands) October 1, 2023 January 1, 2023 Raw materials $ 241,455 $ 320,553 Finished goods 138,129 95,005 Provision for obsolete or aged inventory (15,403) (8,730) Inventories, net $ 364,181 $ 406,828 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 9 Months Ended |
Oct. 01, 2023 | |
Accrued Expenses [Abstract] | |
Schedule of Accrued Expenses | The details of our accrued expenses were as follows as of the dates indicated: (In thousands) October 1, 2023 January 1, 2023 Accrued payroll $ 70,059 $ 69,224 Accrued rebates 54,976 50,200 Current portion of operating lease liabilities 27,554 24,372 Accrued interest 9,477 16,480 Other accruals 51,854 62,770 Total accrued expenses $ 213,920 $ 223,046 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 9 Months Ended |
Oct. 01, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Long-Term Debt | (In thousands) October 1, 2023 January 1, 2023 Senior unsecured notes, interest rate of 3.50% , due 2030 $ 375,000 $ 375,000 Senior unsecured notes, interest rate of 5.375% , due 2028 500,000 500,000 Term Loan Facility, interest rate of SOFR plus 2.25%, due 2027 231,250 — Debt issuance costs (10,540) (8,884) Total debt (including current portion) 1,095,710 866,116 Less: debt due within one year (37,500) — Total long-term debt (excluding current portion) $ 1,058,210 $ 866,116 |
Share Based Compensation Plans
Share Based Compensation Plans (Tables) | 9 Months Ended |
Oct. 01, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock Appreciation Rights Award Activity | Nine Months Ended October 1, 2023 Stock Appreciation Rights Aggregate Intrinsic Value (in thousands) Weighted Average Exercise Price Average Remaining Contractual Life (Years) Outstanding, beginning of period 184,205 $ 2,153 $ 74.75 7.0 Granted 30,946 88.99 Exercised — — — Cancelled and forfeited (4,465) 90.76 Outstanding, end of period 210,686 $ 3,870 $ 76.50 6.3 Exercisable, end of period 153,236 $ 3,648 $ 70.93 5.4 |
Schedule of Share-Based Compensation, Stock Appreciation Rights, Valuation Assumptions | The weighted average grant date assumptions used for the SARs granted were as follows for the periods indicated: 2023 Grants SAR value (model conclusion) $ 32.63 Risk-free rate 4.1 % Expected dividend yield 0.0 % Expected volatility 28.4 % Expected term (years) 6.0 |
Restricted Stock Units Award Activity | Nine Months Ended October 1, 2023 Total Restricted Stock Units Outstanding Weighted Average Grant Date Fair Value Outstanding, beginning of period 313,753 $ 92.85 Granted 212,045 89.94 Delivered (103,072) 91.45 Withheld to cover (1) (20,600) Forfeited (38,200) 91.29 Outstanding, end of period 363,926 $ 91.79 ___________ (1) A portion of the vested RSUs delivered were net shares settled to cover statutory requirements for income and other employment taxes. We remit the equivalent cash to the appropriate taxing authorities. These net share settlements had the effect of share repurchases by us as we reduced and retired the number of shares that would have otherwise been issued as a result of the vesting. |
Share-Based Payment Arrangement, Performance Shares, Activity | Nine Months Ended October 1, 2023 Total Performance Restricted Stock Units Outstanding Weighted Average Grant Date Fair Value Outstanding, beginning of period 310,678 $ 90.15 Granted 92,743 104.36 Performance adjustment (1) 17,139 79.25 Delivered (63,432) 79.25 Withheld to cover (2) (5,224) Forfeited (30,376) 94.50 Outstanding, end of period 321,528 $ 95.58 ___________ (1) PRSUs are presented as outstanding, granted and forfeited in the table above assuming targets are met and the awards pay out at 100%. Certain awards are settled with payouts ranging from zero to 200% of the target award value depending on achievement. The performance adjustment represents the difference in shares ultimately awarded due to performance attainment above or below target. (2) A portion of the vested PRSUs delivered were net shares settled to cover statutory requirements for income and other employment taxes. We remit the equivalent cash to the appropriate taxing authorities. These net share settlements had the effect of share repurchases by us as we reduced and retired the number of shares that would have otherwise been issued as a result of the vesting. |
Restructuring Costs (Tables)
Restructuring Costs (Tables) | 9 Months Ended |
Oct. 01, 2023 | |
Restructuring and Related Activities [Abstract] | |
Summary of Restructuring (Benefit) Costs by Plan | The following tables summarize the restructuring (benefit) costs recorded for the periods indicated: Three Months Ended October 1, 2023 (In thousands) North American Residential Architectural Corporate & Other Total 2022 Plan $ 1,898 $ — $ 2 $ 1,900 Total Restructuring Costs $ 1,898 $ — $ 2 $ 1,900 Three Months Ended October 2, 2022 (In thousands) North American Residential Architectural Corporate & Other Total Other $ (178) $ 23 $ 14 $ (141) Total Restructuring (Benefit) Costs $ (178) $ 23 $ 14 $ (141) Nine Months Ended October 1, 2023 (In thousands) North American Residential Architectural Corporate & Other Total 2022 Plan $ 7,153 $ 863 $ 627 $ 8,643 Total Restructuring (Benefit) Costs $ 7,153 $ 863 $ 627 $ 8,643 Nine Months Ended October 2, 2022 (In thousands) North American Residential Architectural Corporate & Other Total Other $ (359) $ 71 $ 67 $ (221) Total Restructuring (Benefit) Costs $ (359) $ 71 $ 67 $ (221) Cumulative Amount Incurred Through October 1, 2023 (In thousands) North American Residential Architectural Corporate & Other Total 2022 Plan $ 9,284 $ 863 $ 627 $ 10,774 Total Restructuring Costs $ 9,284 $ 863 $ 627 $ 10,774 |
Schedule of Restructuring Reserve by Type of Cost | The changes in the accrual for restructuring by activity were as follows for the periods indicated: (In thousands) January 1, Severance Closure Costs Cash Payments October 1, 2022 Plan $ — $ 5,552 $ 3,091 $ (8,098) $ 545 Total $ — $ 5,552 $ 3,091 $ (8,098) $ 545 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Oct. 01, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share | (In thousands, except share and per share information) Three Months Ended Nine Months Ended October 1, 2023 October 2, 2022 October 1, 2023 October 2, 2022 Net income attributable to Masonite $ 41,486 $ 57,037 $ 128,222 $ 183,134 Shares used in computing basic earnings per share 21,992,513 22,267,684 22,082,416 22,624,830 Effect of dilutive securities: Incremental shares issuable under share compensation plans 346,660 224,190 307,262 248,197 Shares used in computing diluted earnings per share 22,339,173 22,491,874 22,389,678 22,873,027 Basic earnings per common share attributable to Masonite $ 1.89 $ 2.56 $ 5.81 $ 8.09 Diluted earnings per common share attributable to Masonite $ 1.86 $ 2.54 $ 5.73 $ 8.01 Anti-dilutive instruments excluded from diluted earnings per common share 58,817 212,197 98,145 223,660 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Oct. 01, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Certain information with respect to reportable segments is as follows for the periods indicated: Three Months Ended October 1, 2023 (In thousands) North American Residential Europe Architectural Corporate & Other Total Net sales $ 553,294 $ 64,813 $ 82,558 $ 4,066 $ 704,731 Intersegment sales (315) (254) (1,900) (15) (2,484) Net sales to external customers $ 552,979 $ 64,559 $ 80,658 $ 4,051 $ 702,247 Adjusted EBITDA $ 108,999 $ 3,698 $ 5,132 $ (10,593) $ 107,236 Three Months Ended October 2, 2022 (In thousands) North American Residential Europe Architectural Corporate & Other Total Net sales $ 579,908 $ 66,109 $ 82,388 $ 4,625 $ 733,030 Intersegment sales (468) (391) (4,545) — (5,404) Net sales to external customers $ 579,440 $ 65,718 $ 77,843 $ 4,625 $ 727,626 Adjusted EBITDA $ 115,092 $ 3,898 $ (219) $ (6,849) $ 111,922 Nine Months Ended October 1, 2023 (In thousands) North American Residential Europe Architectural Corporate & Other Total Net sales $ 1,708,145 $ 194,761 $ 267,751 $ 12,502 $ 2,183,159 Intersegment sales (1,158) (498) (11,373) (15) (13,044) Net sales to external customers $ 1,706,987 $ 194,263 $ 256,378 $ 12,487 $ 2,170,115 Adjusted EBITDA $ 334,451 $ 11,540 $ 17,768 $ (31,901) $ 331,858 Nine Months Ended October 2, 2022 (In thousands) North American Residential Europe Architectural Corporate & Other Total Net sales $ 1,757,820 $ 222,120 $ 236,941 $ 15,641 $ 2,232,522 Intersegment sales (2,040) (2,081) (12,684) — (16,805) Net sales to external customers $ 1,755,780 $ 220,039 $ 224,257 $ 15,641 $ 2,215,717 Adjusted EBITDA $ 367,733 $ 24,307 $ (3,039) $ (34,202) $ 354,799 |
Reconciliation of Consolidated Adjusted EBITDA to Net Income (Loss) Attributable to Masonite | A reconciliation of our net income attributable to Masonite to consolidated Adjusted EBITDA is set forth as follows for the periods indicated: Three Months Ended Nine Months Ended (In thousands) October 1, 2023 October 2, 2022 October 1, 2023 October 2, 2022 Net income attributable to Masonite $ 41,486 $ 57,037 $ 128,222 $ 183,134 Plus: Depreciation 22,889 17,461 67,355 51,977 Amortization 7,452 4,256 21,915 13,164 Share based compensation expense 4,282 5,556 17,439 16,251 Loss (gain) on disposal of property, plant and equipment 1,779 155 3,319 (1,245) Restructuring costs (benefit) 1,900 (141) 8,643 (221) Interest expense, net 11,913 10,266 39,653 31,098 Other (income) expense, net (1,083) 211 (1,581) (1,604) Income tax expense 12,041 16,376 38,074 59,502 Other items (1) 3,760 — 6,349 — Net income attributable to non-controlling interest 817 745 2,470 2,743 Adjusted EBITDA $ 107,236 $ 111,922 $ 331,858 $ 354,799 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss and Other Comprehensive (Loss) Income (Tables) | 9 Months Ended |
Oct. 01, 2023 | |
Equity [Abstract] | |
Schedule of Components of Accumulated Other Comprehensive (Loss) Income | A rollforward of the components of accumulated other comprehensive loss is as follows for the periods indicated: Three Months Ended Nine Months Ended (In thousands) October 1, 2023 October 2, 2022 October 1, 2023 October 2, 2022 Accumulated foreign currency translation losses, beginning of period $ (114,657) $ (128,070) $ (132,001) $ (96,919) Foreign currency translation (loss) gain (9,837) (29,021) 7,653 (59,518) Income tax (benefit) expense on foreign currency translation loss (6) (45) 4 (58) Less: foreign currency translation (loss) gain attributable to non-controlling interest (83) (45) 73 596 Accumulated foreign currency translation losses, end of period (124,417) (157,091) (124,417) (157,091) Accumulated pension and other post-retirement adjustments, beginning of period (9,924) (4,651) (10,223) (4,663) Amortization of actuarial net losses 191 6 574 18 Income tax expense on amortization of actuarial net losses (51) — (135) — Accumulated pension and other post-retirement adjustments (9,784) (4,645) (9,784) (4,645) Accumulated other comprehensive loss $ (134,201) $ (161,736) $ (134,201) $ (161,736) Other comprehensive (loss) income, net of tax $ (9,703) $ (29,060) $ 8,096 $ (59,558) Less: other comprehensive (loss) income attributable to non-controlling interest (83) (45) 73 596 Other comprehensive (loss) income attributable to Masonite $ (9,620) $ (29,015) $ 8,023 $ (60,154) |
Supplemental Cash Flow Inform_2
Supplemental Cash Flow Information (Tables) | 9 Months Ended |
Oct. 01, 2023 | |
Supplemental Cash Flow Elements [Abstract] | |
Cash and Non-Cash Transactions | Certain cash and non-cash transactions were as follows for the periods indicated: Nine Months Ended (In thousands) October 1, 2023 October 2, 2022 Transactions involving cash: Interest paid $ 52,336 $ 40,650 Interest received 8,543 1,032 Income taxes paid 67,846 67,841 Income tax refunds 3,781 1,576 Cash paid for operating lease liabilities 28,963 24,526 Cash paid for finance lease liabilities 1,060 1,005 Non-cash transactions: Right-of-use assets acquired under operating leases 69,301 4,694 Holdback of portion of Endura purchase payable 18,000 — |
Schedule of Cash, Cash Equivalents and Restricted Cash | The following reconciles total cash, cash equivalents and restricted cash as of the dates indicated: October 1, 2023 January 1, 2023 Cash and cash equivalents $ 360,482 $ 296,922 Restricted cash 11,926 11,999 Total cash, cash equivalents and restricted cash $ 372,408 $ 308,921 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 9 Months Ended |
Oct. 01, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Carrying Values and Estimated Fair Values of Debt Instruments | The estimated fair values and carrying values of our long-term senior note debt instruments were as follows for the periods indicated: October 1, 2023 January 1, 2023 (In thousands) Fair Value Carrying Value Fair Value Carrying Value 3.50% senior unsecured notes due 2030 $ 305,340 $ 371,542 $ 303,870 $ 371,136 5.375% senior unsecured notes due 2028 $ 465,950 $ 496,424 $ 462,495 $ 495,868 |
Business Overview and Signifi_3
Business Overview and Significant Accounting Policies (Details) | Oct. 01, 2023 Country facility |
Accounting Policies [Abstract] | |
Number of manufacturing locations | facility | 63 |
Number of countries | Country | 7 |
Acquisitions and Divestitures_2
Acquisitions and Divestitures (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Jan. 03, 2023 | Oct. 01, 2023 | Oct. 01, 2023 | Oct. 02, 2022 | Jan. 01, 2023 | |
Business Acquisition [Line Items] | |||||
Holdback of portion of Endura purchase payable | $ 0 | ||||
Goodwill | $ 253,871 | $ 253,871 | $ 69,868 | ||
Endura | |||||
Business Acquisition [Line Items] | |||||
Acquired equity interests, percent | 100% | ||||
Business combination, consideration transferred | $ 403,300 | ||||
Holdback of portion of Endura purchase payable | 18,000 | ||||
Goodwill | 189,938 | 182,894 | 182,894 | ||
Gross contractual value of acquired trade receivables | $ 8,300 | ||||
Net sales attributable to Masonite | 59,700 | 178,900 | |||
Net income (loss) attributable to Masonite | $ 1,700 | $ (1,500) |
Acquisitions and Divestitures_3
Acquisitions and Divestitures (Schedule of Recognized Identified Assets Acquired and Liabilities Assumed) (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Oct. 01, 2023 | Jan. 03, 2023 | Jan. 01, 2023 | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net [Abstract] | |||
Goodwill | $ 253,871 | $ 69,868 | |
Endura | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net [Abstract] | |||
Cash acquired | 32,401 | $ 32,501 | |
Accounts receivable, net | 8,161 | 7,871 | |
Inventories, net | 44,218 | 44,183 | |
Property, plant and equipment, net | 64,949 | 54,373 | |
Goodwill | 182,894 | 189,938 | |
Intangible assets | 128,400 | 135,800 | |
Accounts payable and accrued expenses | (15,278) | (15,088) | |
Deferred income taxes | (45,291) | (44,345) | |
Other assets and liabilities, net | 2,833 | 2,868 | |
Total purchase price | 403,287 | $ 408,101 | |
Business Combination, Provisional Information, Initial Accounting Incomplete, Adjustments [Abstract] | |||
Cash acquired | (100) | ||
Accounts receivable, net | 290 | ||
Inventories, net | 35 | ||
Property, plant and equipment, net | 10,576 | ||
Goodwill | (7,044) | ||
Intangible assets | (7,400) | ||
Accounts payable and accrued expenses | (190) | ||
Deferred income taxes | (946) | ||
Other assets and liabilities, net | (35) | ||
Total purchase price | $ (4,814) |
Acquisitions and Divestitures_4
Acquisitions and Divestitures (Schedule of Finite-Lived Intangible Assets) (Details) - Endura $ in Thousands | Jan. 03, 2023 USD ($) |
Business Acquisition [Line Items] | |
Fair value | $ 128,400 |
Customer relationships | |
Business Acquisition [Line Items] | |
Fair value | $ 108,600 |
Expected useful life | 10 years |
Trademarks and trade names | |
Business Acquisition [Line Items] | |
Fair value | $ 6,600 |
Expected useful life | 10 years |
Patents | |
Business Acquisition [Line Items] | |
Fair value | $ 13,200 |
Expected useful life | 12 years |
Acquisitions and Divestitures_5
Acquisitions and Divestitures (Schedule of Pro Forma Information) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 01, 2023 | Oct. 02, 2022 | Oct. 01, 2023 | Oct. 02, 2022 | |
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Net sales | $ 702,247 | $ 727,626 | $ 2,170,115 | $ 2,215,717 |
Net income attributable to Masonite | $ 41,486 | $ 57,037 | $ 128,222 | $ 183,134 |
Basic earnings per common share attributable to Masonite (in dollars per share) | $ 1.89 | $ 2.56 | $ 5.81 | $ 8.09 |
Diluted earnings per common share attributable to Masonite (in dollars per share) | $ 1.86 | $ 2.54 | $ 5.73 | $ 8.01 |
Endura | ||||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Net sales | $ 67,950 | $ 214,145 | ||
Net income attributable to Masonite | 1,775 | 9,225 | ||
Pro forma revenue | 798,518 | 2,426,984 | ||
Pro forma net income | $ 48,980 | $ 168,796 | ||
Pro forma earnings per share, basic (in dollars per share) | $ 2.20 | $ 7.46 | ||
Pro forma earnings per share, diluted (in dollars per share) | $ 2.18 | $ 7.38 | ||
Endura | Intercompany Eliminations | ||||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Net sales | $ 2,942 | $ (2,878) | ||
Net income attributable to Masonite | $ (9,832) | $ (23,563) |
Accounts Receivable (Details)
Accounts Receivable (Details) $ in Thousands | 9 Months Ended | 12 Months Ended |
Oct. 01, 2023 USD ($) Customer | Jan. 01, 2023 USD ($) | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Allowance for doubtful accounts | $ | $ 2,900 | $ 2,500 |
Accounts Receivable | Customer Concentration Risk | Ten Largest Customers | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Concentration risk, customers | Customer | 10 | |
Concentration risk, percent | 59.40% | 62.30% |
Accounts Receivable | Customer Concentration Risk | The Home Depot, Inc. | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Concentration risk, percent | 10% | 10% |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Oct. 01, 2023 | Jan. 01, 2023 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 241,455 | $ 320,553 |
Finished goods | 138,129 | 95,005 |
Provision for obsolete or aged inventory | (15,403) | (8,730) |
Inventories, net | $ 364,181 | $ 406,828 |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) $ in Thousands | Oct. 01, 2023 | Jan. 01, 2023 |
Accrued Expenses [Abstract] | ||
Accrued payroll | $ 70,059 | $ 69,224 |
Accrued rebates | 54,976 | 50,200 |
Current portion of operating lease liabilities | 27,554 | 24,372 |
Accrued interest | 9,477 | 16,480 |
Other accruals | 51,854 | 62,770 |
Total accrued expenses | $ 213,920 | $ 223,046 |
Long-Term Debt (Schedule of Lon
Long-Term Debt (Schedule of Long-Term Debt) (Details) - USD ($) $ in Thousands | Oct. 01, 2023 | Jan. 01, 2023 | Jul. 26, 2021 | Jul. 25, 2019 |
Debt Instrument [Line Items] | ||||
Debt issuance costs | $ (10,540) | $ (8,884) | ||
Total debt (including current portion) | 1,095,710 | 866,116 | ||
Less: debt due within one year | (37,500) | 0 | ||
Total long-term debt (excluding current portion) | 1,058,210 | 866,116 | ||
Senior Notes | Senior Notes 2030 | ||||
Debt Instrument [Line Items] | ||||
Long-term debt, gross | 375,000 | 375,000 | ||
Interest rate stated percentage | 3.50% | |||
Senior Notes | Senior Notes Due 2028 | ||||
Debt Instrument [Line Items] | ||||
Long-term debt, gross | 500,000 | 500,000 | ||
Interest rate stated percentage | 5.375% | |||
Line of Credit | Term Loan A | Secured Debt | ||||
Debt Instrument [Line Items] | ||||
Long-term debt, gross | 231,250 | $ 0 | ||
Debt issuance costs | $ (3,600) |
Long-Term Debt (Narrative) (Det
Long-Term Debt (Narrative) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||||||
Jan. 03, 2023 | Dec. 13, 2022 | Oct. 28, 2022 | Oct. 01, 2023 | Oct. 02, 2022 | Oct. 01, 2023 | Oct. 02, 2022 | Jul. 26, 2021 | Jul. 25, 2019 | Jan. 31, 2019 | |
Debt Instrument [Line Items] | ||||||||||
Proceeds from issuance of long-term debt | $ 250,000,000 | $ 0 | ||||||||
Revolving Credit Facility | ABL Facility 2024 | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Maximum borrowing capacity | $ 250,000,000 | |||||||||
Line of credit facility, increase (decrease), net | $ 100,000,000 | |||||||||
Revolving credit facility availability | $ 276,000,000 | 276,000,000 | ||||||||
Revolving credit facilities | 0 | 0 | ||||||||
Revolving Credit Facility | ABL Facility 2027 | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Maximum borrowing capacity | $ 350,000,000 | |||||||||
Proceeds from borrowings on revolving credit facilities | $ 100,000,000 | |||||||||
Senior Notes | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Interest expense | $ 13,500,000 | $ 10,400,000 | $ 43,000,000 | $ 31,100,000 | ||||||
Senior Notes | Senior Notes 2030 | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Interest rate stated percentage | 3.50% | |||||||||
Aggregate principal | $ 375,000,000 | |||||||||
Senior Notes | Senior Notes Due 2028 | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Interest rate stated percentage | 5.375% | |||||||||
Aggregate principal | $ 500,000,000 | |||||||||
Line of Credit | Secured Debt | Term Loan A | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Aggregate principal | $ 250,000,000 | |||||||||
Debt instrument, term | 5 years | |||||||||
Maximum borrowing capacity | $ 250,000,000 | |||||||||
Annual principal payment, percentage | 15% | |||||||||
Proceeds from issuance of long-term debt | $ 246,400,000 | |||||||||
Line of Credit | Secured Debt | Term Loan A | Adjusted Term Secured Overnight Financing Rate (SOFR) | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate | 2.25% | |||||||||
Line of Credit | Secured Debt | Term Loan A | Adjusted Base Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate | 0.50% | |||||||||
Line of Credit | Secured Debt | Term Loan A | Premium Adjusted Term Secured Overnight Financing Rate (SOFR) | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate | 1% | |||||||||
Line of Credit | Secured Debt | Term Loan A | Base Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate | 1% | |||||||||
Line of Credit | Secured Debt | Term Loan A | Applicable Margin | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate | 1.25% |
Commitment and Contingencies (D
Commitment and Contingencies (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Nov. 03, 2023 | Oct. 01, 2023 | Oct. 02, 2022 | Oct. 01, 2023 | Oct. 02, 2022 | |
Loss Contingencies [Line Items] | |||||
Increase to legal reserve | $ 3,760 | $ 0 | $ 6,349 | $ 0 | |
Selling, General and Administrative Expenses | |||||
Loss Contingencies [Line Items] | |||||
Increase to legal reserve | $ 900 | ||||
Antitrust Litigation - Canada | Subsequent Event | |||||
Loss Contingencies [Line Items] | |||||
Legal settlement awarded to other parties | $ 900 |
Share Based Compensation Plan_2
Share Based Compensation Plans (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Oct. 01, 2023 | Oct. 02, 2022 | Oct. 01, 2023 | Oct. 02, 2022 | Mar. 10, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based compensation | $ 4,282 | $ 5,556 | $ 17,439 | $ 16,251 | |
Share based compensation unrecognized | 31,800 | $ 31,800 | |||
Weighted average remaining requisite service period | 1 year 8 months 12 days | ||||
Deferred compensation liability | 8,000 | $ 8,000 | |||
Deferred compensation asset | $ 7,300 | $ 7,300 | |||
2021 Plan | Common Stock | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Equity awards not to exceed (in shares) | 880,000 | ||||
Common stock available for future issuance (in shares) | 766,368 | 766,368 | |||
Stock Appreciation Rights (SARs) | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting period | 3 years | ||||
Plan term | 10 years | ||||
Vested, fair value | $ 700 | ||||
Average requisite service period | 2 years | ||||
Restricted Stock Units (RSUs) | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Average requisite service period | 2 years | ||||
Units vested (in shares) | 123,672 | ||||
Fair value of shares vested | $ 11,300 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Fair Value | $ 19,100 | ||||
Restricted Stock Units (RSUs) | Service Requirement | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting percentage | 65% | ||||
Restricted Stock Units (RSUs) | Service and Performance Requirements | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting percentage | 35% | ||||
Performance Shares | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting period | 3 years | ||||
Average requisite service period | 3 years | ||||
Units vested (in shares) | 68,656 | ||||
Fair value of shares vested | $ 5,400 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Fair Value | $ 9,700 |
Share Based Compensation Plan_3
Share Based Compensation Plans (SARs) (Details) - Stock Appreciation Rights (SARs) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended |
Oct. 01, 2023 | Jan. 01, 2023 | |
Stock Appreciation Rights | ||
Outstanding, beginning of period (in shares) | 184,205 | |
Granted (in shares) | 30,946 | |
Exercised (in shares) | 0 | |
Forfeited (in shares) | (4,465) | |
Outstanding, end of period (in shares) | 210,686 | 184,205 |
Exercisable, shares | 153,236 | |
Aggregate Intrinsic Value & Average Remaining Contractual Life | ||
Outstanding, beginning of period, aggregate intrinsic value | $ 2,153 | |
Exercised, aggregate intrinsic value | 0 | |
Outstanding, end period, aggregate intrinsic value | 3,870 | $ 2,153 |
Exercisable, aggregate intrinsic value | $ 3,648 | |
Outstanding, beginning of period, weighted average remaining contractual term | 6 years 3 months 18 days | 7 years |
Outstanding, end of period, weighted average remaining contractual term | 6 years 3 months 18 days | 7 years |
Exercisable, weighted average remaining contractual term | 5 years 4 months 24 days | |
Weighted Average Exercise Price | ||
Outstanding, beginning of period (in dollars per share) | $ 74.75 | |
Granted (in dollars per share) | 88.99 | |
Exercised (in dollars per share) | 0 | |
Forfeited (in dollars per share) | 90.76 | |
Outstanding, end of period (in dollars per share) | 76.50 | $ 74.75 |
Exercisable, end of period (in dollars per share) | $ 70.93 |
Share Based Compensation Plan_4
Share Based Compensation Plans (Weighted Average Grant Date Assumptions) (Details) - Stock Appreciation Rights (SARs) | 9 Months Ended |
Oct. 01, 2023 $ / shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
SAR value (model conclusion) | $ 32.63 |
Risk-free rate | 4.10% |
Expected dividend yield | 0% |
Expected volatility | 28.40% |
Expected term (years) | 6 years |
Share Based Compensation Plan_5
Share Based Compensation Plans (RSUs) (Details) | 9 Months Ended |
Oct. 01, 2023 $ / shares shares | |
Restricted Stock Units (RSUs) | |
Total Restricted Stock Units Outstanding | |
Outstanding, beginning of period (in shares) | 313,753 |
Granted (in shares) | 212,045 |
Delivered (in shares) | (103,072) |
Withheld to cover (in shares) | (20,600) |
Forfeited (in shares) | (38,200) |
Outstanding, end of period (in shares) | 363,926 |
Weighted Average Grant Date Fair Value | |
Outstanding, beginning of period (in dollars per share) | $ / shares | $ 92.85 |
Granted (in dollars per share) | $ / shares | 89.94 |
Delivered (in dollars per share) | $ / shares | 91.45 |
Forfeited (in dollars per share) | $ / shares | 91.29 |
Outstanding, end of period (in dollars per share) | $ / shares | $ 91.79 |
Performance Shares | |
Total Restricted Stock Units Outstanding | |
Outstanding, beginning of period (in shares) | 310,678 |
Granted (in shares) | 92,743 |
Performance adjustment (in shares) | 17,139 |
Delivered (in shares) | (63,432) |
Withheld to cover (in shares) | (5,224) |
Forfeited (in shares) | (30,376) |
Outstanding, end of period (in shares) | 321,528 |
Weighted Average Grant Date Fair Value | |
Outstanding, beginning of period (in dollars per share) | $ / shares | $ 90.15 |
Granted (in dollars per share) | $ / shares | 104.36 |
Performance adjustment (in dollars per share) | $ / shares | 79.25 |
Delivered (in dollars per share) | $ / shares | 79.25 |
Forfeited (in dollars per share) | $ / shares | 94.50 |
Outstanding, end of period (in dollars per share) | $ / shares | $ 95.58 |
Restructuring Costs (Narrative)
Restructuring Costs (Narrative) (Details) $ in Millions | Oct. 01, 2023 USD ($) |
Minimum | |
Restructuring Cost and Reserve [Line Items] | |
Expected restructuring cost remaining | $ 4 |
Maximum | |
Restructuring Cost and Reserve [Line Items] | |
Expected restructuring cost remaining | $ 9 |
Restructuring Costs (Schedule o
Restructuring Costs (Schedule of Restructuring Costs) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Oct. 01, 2023 | Oct. 02, 2022 | Oct. 01, 2023 | Oct. 02, 2022 | Jan. 01, 2023 | |
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring costs (benefit) | $ 1,900 | $ (141) | $ 8,643 | $ (221) | |
Cumulative amount incurred to date | 10,774 | 10,774 | |||
Restructuring reserve | (545) | (545) | $ 0 | ||
Cash payments | (8,098) | ||||
Severance | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring costs (benefit) | 5,552 | ||||
Closure Costs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring costs (benefit) | 3,091 | ||||
North American Residential | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring costs (benefit) | 1,898 | 7,153 | |||
Cumulative amount incurred to date | 9,284 | 9,284 | |||
Architectural | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring costs (benefit) | 0 | 863 | |||
Cumulative amount incurred to date | 863 | 863 | |||
Corporate & Other | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring costs (benefit) | 2 | 627 | |||
Cumulative amount incurred to date | 627 | 627 | |||
Twenty Twenty Two Restructuring Plans | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring costs (benefit) | 1,900 | 8,643 | |||
Cumulative amount incurred to date | 10,774 | 10,774 | |||
Restructuring reserve | (545) | (545) | $ 0 | ||
Cash payments | (8,098) | ||||
Twenty Twenty Two Restructuring Plans | Severance | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring costs (benefit) | 5,552 | ||||
Twenty Twenty Two Restructuring Plans | Closure Costs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring costs (benefit) | 3,091 | ||||
Twenty Twenty Two Restructuring Plans | North American Residential | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring costs (benefit) | 1,898 | 7,153 | |||
Cumulative amount incurred to date | 9,284 | 9,284 | |||
Twenty Twenty Two Restructuring Plans | Architectural | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring costs (benefit) | 0 | 863 | |||
Cumulative amount incurred to date | 863 | 863 | |||
Twenty Twenty Two Restructuring Plans | Corporate & Other | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring costs (benefit) | 2 | 627 | |||
Cumulative amount incurred to date | $ 627 | $ 627 | |||
2018 - 2021 Restructuring Plans | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring costs (benefit) | (141) | (221) | |||
2018 - 2021 Restructuring Plans | North American Residential | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring costs (benefit) | (178) | (359) | |||
2018 - 2021 Restructuring Plans | Architectural | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring costs (benefit) | 23 | 71 | |||
2018 - 2021 Restructuring Plans | Corporate & Other | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring costs (benefit) | $ 14 | $ 67 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |
Oct. 02, 2022 | Oct. 01, 2023 | Oct. 02, 2022 | |
Income Tax Disclosure [Abstract] | |||
Canadian federal statutory rate | 26.13% | ||
Income tax benefit due to the exercise and delivery of share-based awards | $ 0 | $ 0 | $ 1.1 |
Earnings Per Share (Schedule of
Earnings Per Share (Schedule of Earnings Per Share) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 01, 2023 | Oct. 02, 2022 | Oct. 01, 2023 | Oct. 02, 2022 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Net income attributable to Masonite | $ 41,486 | $ 57,037 | $ 128,222 | $ 183,134 |
Shares used in computing basic earnings per share | 21,992,513 | 22,267,684 | 22,082,416 | 22,624,830 |
Effect of dilutive securities: | ||||
Incremental shares issuable under share compensation plans | 346,660 | 224,190 | 307,262 | 248,197 |
Shares used in computing diluted earnings per share | 22,339,173 | 22,491,874 | 22,389,678 | 22,873,027 |
Basic earnings per common share attributable to Masonite (in dollars per share) | $ 1.89 | $ 2.56 | $ 5.81 | $ 8.09 |
Diluted earnings per common share attributable to Masonite (in dollars per share) | $ 1.86 | $ 2.54 | $ 5.73 | $ 8.01 |
Stock Appreciation Rights (SARs) | ||||
Effect of dilutive securities: | ||||
Anti-dilutive instruments excluded from diluted earnings per common share (in shares) | 58,817 | 212,197 | 98,145 | 223,660 |
Earnings Per Share (Narrative)
Earnings Per Share (Narrative) (Details) | 3 Months Ended | 12 Months Ended | ||
Jul. 03, 2022 shares | Apr. 03, 2022 USD ($) shares | Jan. 01, 2023 authorization $ / shares shares | Feb. 21, 2022 shares | |
Equity, Class of Treasury Stock [Line Items] | ||||
Number of share repurchase authorizations | authorization | 5 | |||
Number of shares authorized to be repurchased (in shares) | shares | 200,000,000 | |||
Accelerated Share Repurchase | ||||
Equity, Class of Treasury Stock [Line Items] | ||||
Stock repurchase program, authorized amount | $ | $ 100,000,000 | |||
Share repurchases, settlement (payment) | $ | $ 100,000,000 | |||
Treasury stock, acquired (in shares) | shares | 319,678 | 848,087 | 1,167,765 | |
Treasury stock, acquired (in dollars per share) | $ / shares | $ 85.63 |
Segment Information (Geographic
Segment Information (Geographic Segments Information) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 01, 2023 | Oct. 02, 2022 | Oct. 01, 2023 | Oct. 02, 2022 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | $ 702,247 | $ 727,626 | $ 2,170,115 | $ 2,215,717 |
Adjusted EBITDA | 107,236 | 111,922 | 331,858 | 354,799 |
Operating Segments | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | 704,731 | 733,030 | 2,183,159 | 2,232,522 |
Intersegment Eliminations | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | (2,484) | (5,404) | (13,044) | (16,805) |
North American Residential | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | 552,979 | 579,440 | 1,706,987 | 1,755,780 |
Adjusted EBITDA | 108,999 | 115,092 | 334,451 | 367,733 |
North American Residential | Operating Segments | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | 553,294 | 579,908 | 1,708,145 | 1,757,820 |
North American Residential | Intersegment Eliminations | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | (315) | (468) | (1,158) | (2,040) |
Europe | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | 64,559 | 65,718 | 194,263 | 220,039 |
Adjusted EBITDA | 3,698 | 3,898 | 11,540 | 24,307 |
Europe | Operating Segments | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | 64,813 | 66,109 | 194,761 | 222,120 |
Europe | Intersegment Eliminations | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | (254) | (391) | (498) | (2,081) |
Architectural | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | 80,658 | 77,843 | 256,378 | 224,257 |
Adjusted EBITDA | 5,132 | (219) | 17,768 | (3,039) |
Architectural | Operating Segments | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | 82,558 | 82,388 | 267,751 | 236,941 |
Architectural | Intersegment Eliminations | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | (1,900) | (4,545) | (11,373) | (12,684) |
Corporate & Other | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | 4,051 | 4,625 | 12,487 | 15,641 |
Adjusted EBITDA | (10,593) | (6,849) | (31,901) | (34,202) |
Corporate & Other | Operating Segments | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | 4,066 | 4,625 | 12,502 | 15,641 |
Corporate & Other | Intersegment Eliminations | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | $ (15) | $ 0 | $ (15) | $ 0 |
Segment Information (Reconcilia
Segment Information (Reconciliation of Consolidated Adjusted EBITDA to Net Income (Loss)) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 01, 2023 | Oct. 02, 2022 | Oct. 01, 2023 | Oct. 02, 2022 | |
Segment Reporting [Abstract] | ||||
Net income attributable to Masonite | $ 41,486 | $ 57,037 | $ 128,222 | $ 183,134 |
Depreciation | 22,889 | 17,461 | 67,355 | 51,977 |
Amortization | 7,452 | 4,256 | 21,915 | 13,164 |
Share based compensation expense | 4,282 | 5,556 | 17,439 | 16,251 |
Loss (gain) on disposal of property, plant and equipment | 1,779 | 155 | 3,319 | (1,245) |
Restructuring costs (benefit) | 1,900 | (141) | 8,643 | (221) |
Interest expense, net | 11,913 | 10,266 | 39,653 | 31,098 |
Other (income) expense, net | (1,083) | 211 | (1,581) | (1,604) |
Income tax expense | 12,041 | 16,376 | 38,074 | 59,502 |
Other items | 3,760 | 0 | 6,349 | 0 |
Net income attributable to non-controlling interest | 817 | 745 | 2,470 | 2,743 |
Adjusted EBITDA | $ 107,236 | $ 111,922 | $ 331,858 | $ 354,799 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss and Other Comprehensive (Loss) Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Oct. 01, 2023 | Oct. 02, 2022 | Oct. 01, 2023 | Oct. 02, 2022 | Jan. 01, 2023 | |
Accumulated Foreign Currency Translation Gains (Losses) [Roll Forward] | |||||
Accumulated foreign currency translation losses, beginning of period | $ (114,657) | $ (128,070) | $ (132,001) | $ (96,919) | |
Foreign currency translation (loss) gain | (9,837) | (29,021) | 7,653 | (59,518) | |
Income tax (benefit) expense on foreign currency translation loss | (6) | (45) | 4 | (58) | |
Less: foreign currency translation (loss) gain attributable to non-controlling interest | (83) | (45) | 73 | 596 | |
Accumulated foreign currency translation losses, end of period | (124,417) | (157,091) | (124,417) | (157,091) | |
Accumulated Amortization of Actuarial Net Losses [Roll Forward] | |||||
Accumulated pension and other post-retirement adjustments, beginning of period | (9,924) | (4,651) | (10,223) | (4,663) | |
Amortization of actuarial net losses | 191 | 6 | 574 | 18 | |
Income tax expense on amortization of actuarial net losses | 51 | 0 | 135 | 0 | |
Accumulated pension and other post-retirement adjustments | (9,784) | (4,645) | (9,784) | (4,645) | |
Accumulated other comprehensive loss | (134,201) | (161,736) | (134,201) | (161,736) | $ (142,224) |
Other comprehensive (loss) income, net of tax | (9,703) | (29,060) | 8,096 | (59,558) | |
Less: other comprehensive (loss) income attributable to non-controlling interest | (83) | (45) | 73 | 596 | |
Other comprehensive (loss) income attributable to Masonite | $ (9,620) | $ (29,015) | $ 8,023 | $ (60,154) |
Supplemental Cash Flow Inform_3
Supplemental Cash Flow Information (Cash and Non-Cash Transactions) (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Oct. 01, 2023 | Oct. 02, 2022 | |
Transactions involving cash: | ||
Interest paid | $ 52,336 | $ 40,650 |
Interest received | 8,543 | 1,032 |
Income taxes paid | 67,846 | 67,841 |
Income tax refunds | 3,781 | 1,576 |
Cash paid for operating lease liabilities | 28,963 | 24,526 |
Cash paid for finance lease liabilities | 1,060 | 1,005 |
Non-cash transactions: | ||
Right-of-use assets acquired under operating leases | $ 69,301 | 4,694 |
Holdback of portion of Endura purchase payable | $ 0 |
Supplemental Cash Flow Inform_4
Supplemental Cash Flow Information (Cash, Cash Equivalents and Restricted Cash) (Details) - USD ($) $ in Thousands | Oct. 01, 2023 | Jan. 01, 2023 | Oct. 02, 2022 | Jan. 02, 2022 |
Supplemental Cash Flow Elements [Abstract] | ||||
Cash and cash equivalents | $ 360,482 | $ 296,922 | ||
Restricted cash | 11,926 | 11,999 | ||
Total cash, cash equivalents and restricted cash | $ 372,408 | $ 308,921 | $ 262,704 | $ 391,505 |
Supplemental Cash Flow Inform_5
Supplemental Cash Flow Information (Narrative) (Details) - USD ($) $ in Millions | 9 Months Ended | 12 Months Ended |
Oct. 01, 2023 | Jan. 01, 2023 | |
Cash and Cash Equivalents [Abstract] | ||
Property, plant and equipment, additions | $ 10.2 | $ 10.4 |
Financing Receivable, after Allowance for Credit Loss, Current | $ 12.6 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments (Details) - Senior Notes - USD ($) $ in Thousands | Oct. 01, 2023 | Jan. 01, 2023 | Jul. 26, 2021 | Jul. 25, 2019 |
Senior Notes 2030 | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Interest rate stated percentage | 3.50% | |||
Senior Notes 2030 | Fair Value | Fair Value, Inputs, Level 2 | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Estimated fair value of senior notes | $ 305,340 | $ 303,870 | ||
Senior Notes 2030 | Carrying Value | Fair Value, Inputs, Level 2 | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Estimated fair value of senior notes | 371,542 | 371,136 | ||
Senior Notes Due 2028 | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Interest rate stated percentage | 5.375% | |||
Senior Notes Due 2028 | Fair Value | Fair Value, Inputs, Level 2 | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Estimated fair value of senior notes | 465,950 | 462,495 | ||
Senior Notes Due 2028 | Carrying Value | Fair Value, Inputs, Level 2 | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Estimated fair value of senior notes | $ 496,424 | $ 495,868 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Oct. 19, 2023 | Oct. 02, 2022 | |
Subsequent Event [Line Items] | ||
Obligation for holdback from purchase payable | $ 0 | |
Fleetwood | Subsequent Event | ||
Subsequent Event [Line Items] | ||
Acquired equity interests, percent | 100% | |
Cash consideration | $ 285,000 | |
Obligation for holdback from purchase payable | $ 26,000 |