Document and Entity Information
Document and Entity Information | 3 Months Ended |
Mar. 31, 2018shares | |
Document and Entity Information | |
Entity Registrant Name | SIMPSON MANUFACTURING CO INC /CA/ |
Entity Central Index Key | 920,371 |
Document Type | 10-Q |
Document Period End Date | Mar. 31, 2018 |
Amendment Flag | false |
Current Fiscal Year End Date | --12-31 |
Entity Current Reporting Status | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Common Stock, Shares Outstanding | 46,319,026 |
Document Fiscal Year Focus | 2,018 |
Document Fiscal Period Focus | Q1 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2017 |
Current assets | |||
Cash and cash equivalents | $ 137,413 | $ 168,514 | $ 167,059 |
Trade accounts receivable, net | 167,146 | 135,958 | 148,506 |
Inventories | 256,552 | 252,996 | 256,271 |
Other current assets | 22,423 | 26,473 | 13,744 |
Total current assets | 583,534 | 583,941 | 585,580 |
Property, plant and equipment, net | 276,114 | 273,020 | 250,465 |
Goodwill | 138,026 | 137,140 | 135,113 |
Equity investment (see Note 9) | 2,525 | 2,549 | 2,607 |
Intangible assets, net | 28,302 | 29,326 | 31,713 |
Other noncurrent assets | 11,841 | 11,547 | 12,722 |
Total assets | 1,040,342 | 1,037,523 | 1,018,200 |
Current liabilities | |||
Capital lease obligations - current portion | 1,064 | 1,055 | 521 |
Trade accounts payable | 42,098 | 31,536 | 38,219 |
Accrued liabilities | 84,997 | 84,204 | 67,183 |
Income taxes payable | 0 | 0 | 2,290 |
Accrued profit sharing trust contributions | 2,730 | 7,054 | 2,514 |
Accrued cash profit sharing and commissions | 9,102 | 9,416 | 9,256 |
Accrued workers’ compensation | 3,237 | 3,226 | 3,578 |
Total current liabilities | 143,228 | 136,491 | 123,561 |
Capital lease obligations - net of current portion | 2,425 | 2,607 | 1,610 |
Deferred income tax and other long-term liabilities | 15,627 | 13,647 | 6,076 |
Total liabilities | 161,280 | 152,745 | 131,247 |
Commitments and contingencies (see Note 11) | |||
Stockholders’ equity | |||
Common stock, at par value | 475 | 473 | 475 |
Additional paid-in capital | 269,004 | 260,157 | 259,167 |
Retained Earnings | 693,218 | 676,644 | 656,959 |
Treasury stock | (74,999) | (40,000) | 0 |
Accumulated other comprehensive loss | (8,636) | (12,496) | (29,648) |
Total stockholders’ equity | 879,062 | 884,778 | 886,953 |
Total liabilities and stockholders’ equity | $ 1,040,342 | $ 1,037,523 | $ 1,018,200 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Income Statement [Abstract] | ||
Net sales | $ 244,779 | $ 219,867 |
Cost of sales | 136,253 | 119,711 |
Gross profit | 108,526 | 100,156 |
Operating expenses: | ||
Research and development and other engineering | 11,150 | 11,819 |
Selling | 27,573 | 29,637 |
General and administrative | 38,191 | 36,121 |
Net gain on disposal of assets | (1,184) | (51) |
Total operating expenses | 75,730 | 77,526 |
Income from operations | 32,796 | 22,630 |
Loss in equity method investment, before tax | (24) | (28) |
Interest expense, net | (90) | (189) |
Gain on bargain purchase of a business | 0 | 8,388 |
Income before taxes | 32,682 | 30,801 |
Provision for income taxes | 7,253 | 7,680 |
Net income | $ 25,429 | $ 23,121 |
Earnings per common share: | ||
Basic (in dollars per share) | $ 0.55 | $ 0.49 |
Diluted (in dollars per share) | $ 0.54 | $ 0.48 |
Number of shares outstanding | ||
Basic (in shares) | 46,615 | 47,616 |
Diluted (in shares) | 47,009 | 47,906 |
Cash dividends declared per common share (in dollars per share) | $ 0.21 | $ 0.18 |
Condensed Consolidated Stateme4
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 25,429 | $ 23,121 |
Other comprehensive income: | ||
Translation adjustment | 3,860 | 3,322 |
Comprehensive income | $ 29,289 | $ 26,443 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Treasury Stock |
Balance at Dec. 31, 2016 | $ 865,842 | $ 473 | $ 255,917 | $ 642,422 | $ (32,970) | |
Balance (in shares) at Dec. 31, 2016 | 47,437,000 | |||||
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 23,121 | 23,121 | ||||
Translation adjustment, net of tax | 3,322 | 3,322 | ||||
Options exercised | 314 | $ 0 | 314 | |||
Options exercised (in shares) | 11,000 | |||||
Stock-based compensation | 7,650 | 7,650 | ||||
Shares issued from release of Restricted Stock Units | (5,124) | $ 2 | (5,126) | |||
Shares issued from release of Restricted Stock Units (in shares) | 197,000 | |||||
Cash dividends declared on common stock | (8,584) | (8,584) | ||||
Common stock issued | 412 | 412 | ||||
Common stock issued (in shares) | 9,000 | |||||
Balance at Mar. 31, 2017 | 886,953 | $ 475 | 259,167 | 656,959 | (29,648) | $ 0 |
Balance (in shares) at Mar. 31, 2017 | 47,654,000 | |||||
Balance at Dec. 31, 2016 | 865,842 | $ 473 | 255,917 | 642,422 | (32,970) | |
Balance (in shares) at Dec. 31, 2016 | 47,437,000 | |||||
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 69,496 | 69,496 | ||||
Translation adjustment, net of tax | 18,096 | 18,096 | ||||
Pension adjustment, net of tax | (944) | (944) | ||||
Options exercised | 6,296 | $ 3 | 6,293 | |||
Options exercised (in shares) | 212,000 | |||||
Stock-based compensation | 4,915 | 4,915 | ||||
Shares issued from release of Restricted Stock Units | (218) | $ 0 | (218) | |||
Shares issued from release of Restricted Stock Units (in shares) | 17,000 | |||||
Repurchase of common stock | (70,000) | (10,000) | (60,000) | |||
Repurchase of common stock (in shares) | (1,138,000) | |||||
Retirement of common stock | 0 | $ (5) | (19,995) | 20,000 | ||
Cash dividends declared on common stock | (29,816) | (29,816) | ||||
Balance at Dec. 31, 2017 | 884,778 | $ 473 | 260,157 | 676,644 | (12,496) | (40,000) |
Balance (in shares) at Dec. 31, 2017 | 46,745,000 | |||||
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 25,429 | 25,429 | ||||
Translation adjustment, net of tax | 3,860 | 3,860 | ||||
Options exercised | 695 | $ 0 | 695 | |||
Options exercised (in shares) | 23,000 | |||||
Stock-based compensation | 2,716 | 2,716 | ||||
Tax benefit of options exercised | 792 | 0 | 792 | |||
Shares issued from release of Restricted Stock Units | (5,027) | $ 2 | (5,029) | |||
Shares issued from release of Restricted Stock Units (in shares) | 163,000 | |||||
Repurchase of common stock | $ (24,999) | 10,000 | (34,999) | |||
Repurchase of common stock (in shares) | (437,500) | (620,000) | ||||
Cash dividends declared on common stock | $ (9,647) | (9,647) | ||||
Common stock issued | 465 | 465 | ||||
Common stock issued (in shares) | 8,000 | |||||
Balance at Mar. 31, 2018 | $ 879,062 | $ 475 | $ 269,004 | $ 693,218 | $ (8,636) | $ (74,999) |
Balance (in shares) at Mar. 31, 2018 | 46,319,000 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Stockholders' Equity (Parenthetical) - $ / shares | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Statement of Stockholders' Equity [Abstract] | ||
Cash dividends declared per common share (in dollars per share) | $ 0.21 | $ 0.18 |
Common stock issued per share for stock bonus (in USD per share) | $ 57.41 | $ 44.26 |
Condensed Consolidated Stateme7
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Statement of Cash Flows [Abstract] | ||
Net income | $ 25,429 | $ 23,121 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Gain on sale of assets | (1,184) | (51) |
Depreciation and amortization | 9,688 | 8,363 |
Loss in equity method investment, before tax | 24 | 28 |
Gain on bargain purchase of a business | 0 | (8,388) |
Deferred income taxes | 1,448 | 1,163 |
Noncash compensation related to stock plans | 3,116 | 7,976 |
Provision of doubtful accounts | 222 | 13 |
Changes in operating assets and liabilities, net of acquisitions: | ||
Trade accounts receivable | (30,764) | (30,254) |
Inventories | (3,071) | (9,796) |
Trade accounts payable | 11,451 | 3,209 |
Income taxes payable | 721 | 3,681 |
Accrued profit sharing trust contributions | (4,326) | (4,036) |
Accrued cash profit sharing and commissions | (346) | (1,287) |
Other current assets | 1,923 | (695) |
Accrued liabilities | (983) | (845) |
Long-term liabilities | 3,763 | 87 |
Accrued workers’ compensation | 12 | 9 |
Other noncurrent assets | (5) | 210 |
Net cash provided by (used in) operating activities | 17,118 | (7,492) |
Cash flows from investing activities | ||
Capital expenditures | (10,935) | (13,629) |
Asset acquisitions, net of cash acquired | 0 | (26,289) |
Proceeds from sale of property and equipment | 1,239 | 53 |
Net cash used in investing activities | (9,696) | (39,865) |
Cash flows from financing activities | ||
Deferred and contingent consideration paid for asset acquisitions | 0 | (65) |
Repurchase of common stock | (24,999) | 0 |
Repayment of long-term borrowings and capital leases | (174) | 0 |
Issuance of common stock | 695 | 314 |
Dividends paid | (9,818) | (8,538) |
Cash paid on behalf of employees for shares withheld | (5,027) | (5,124) |
Net cash used in financing activities | (39,323) | (13,413) |
Effect of exchange rate changes on cash and cash equivalents | 800 | 1,292 |
Net decrease in cash and cash equivalents | (31,101) | (59,478) |
Cash and cash equivalents at beginning of period | 168,514 | 226,537 |
Cash and cash equivalents at end of period | 137,413 | 167,059 |
Noncash activity during the period | ||
Noncash capital expenditures | 1,567 | 4,817 |
Capital lease obligations | 0 | 2,131 |
Dividends declared but not paid | 10,190 | 8,578 |
Contingent consideration for acquisition | 0 | 1,139 |
Issuance of Company’s common stock for compensation | $ 465 | $ 412 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation Principles of Consolidation The condensed consolidated financial statements include the accounts of Simpson Manufacturing Co., Inc. and its subsidiaries (collectively, the “Company”). There were no investments in affiliates that would render such affiliates to be considered variable interest entities. All significant intercompany transactions have been eliminated. Interim Reporting Period The accompanying unaudited interim condensed consolidated financial statements have been prepared pursuant to the rules and regulations for reporting on Form 10-Q. Accordingly, certain information and footnotes required by accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted. These interim statements should be read in conjunction with the audited consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2017 . The unaudited quarterly condensed consolidated financial statements have been prepared on the same basis as the audited annual consolidated financial statements and, in the opinion of management, contain all adjustments (consisting of only normal recurring adjustments) necessary to state fairly the financial information set forth therein, in accordance with GAAP. Certain prior period amounts in the condensed consolidated financial statements and the accompanying notes have been reclassified to conform to the current period’s presentation. The year-end condensed consolidated balance sheet data provided herein were derived from audited financial statements, but do not include all disclosures required by GAAP. The Company’s quarterly results fluctuate. As a result, the Company believes the results of operations for this interim period presented are not indicative of the results to be expected for any future periods. Prior Year Reclassification In the third quarter of 2017, the Company reclassified year-to-date expenses associated with a recent acquisition from engineering and research and development to general and administrative and sales and marketing. The 2017 first quarter financial results have been revised for these changes with $1.3 million of costs reclassified from research and development and engineering expense to general and administrative expense ( $1.1 million ) and selling expense ( $0.2 million ), respectively. Revenue Recognition In May 2014, the FASB issued Accounting Standards Update No. 2014-09 (later codified as ASC Topic 606), Revenue from Contracts with Customers , which supersedes nearly all existing revenue recognition guidance under GAAP. ASC 606 provides a five-step model for revenue recognition to be applied to all revenue contracts with customers. Under ASC 606, the revenue is recognized when a customer obtains control of promised goods or services and in an amount that reflects the consideration the entity expects to receive in exchange for those goods or services. The Company adopted ASU 2014-09 and its related amendments, effective January 1, 2018 using the modified retrospective implementation method. Accordingly, the Company applied the five-step method outlined in Topic 606 for determining when and how revenue is recognized to all contracts. Revenues for reporting periods beginning after January 1, 2018 are presented under Topic 606. While Topic 606 requires additional disclosure about the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers, including significant judgments and changes in judgments, its adoption has not had a material impact on the measurement or recognition of the Company’s revenues. In addition, the adoption of Topic 606 had no material impact to cash from or used in operating, financing, or investing on the consolidated cash flows statements (See “Note 2 - Revenue from Contracts with Customers" to the Company's Consolidated Financial Statements). Net Earnings Per Common Share Basic earnings per common share are computed based on the weighted-average number of common shares outstanding during the period. Potentially dilutive securities, using the treasury stock method, are included in the diluted per-share calculations for all periods when the effect of their inclusion is dilutive. The following is a reconciliation of basic earnings per common share to diluted earnings per share for the three months ended March 31, 2018 and 2017 , respectively: Three Months Ended (in thousands, except per share amounts) 2018 2017 Net income available to common stockholders $ 25,429 $ 23,121 Basic weighted-average shares outstanding 46,615 47,616 Dilutive effect of potential common stock equivalents — stock options and restricted stock units 394 290 Diluted weighted-average shares outstanding 47,009 47,906 Earnings per common share: Basic $ 0.55 $ 0.49 Diluted $ 0.54 $ 0.48 Share Repurchases During the first quarter of 2018, the Company received 182,171 shares of the Company's common stock pursuant to the Company’s $50.0 million accelerated share repurchase program with Wells Fargo Bank, National Association, initiated in December 2017 (the "2017 December ASR Program") which constituted the final delivery under the 2017 December ASR Program. During the first quarter of 2018, the Company also repurchased in the open market 437,500 shares of the Company's common stock at an average price of $57.14 per share, for a total of $25.0 million . As a result, as of March 31, 2018 , approximately $126.5 million remained available for share repurchase through December 31, 2018 under the Company's previously announced $275 million share repurchase authorization. Accounting for Stock-Based Compensation The Company recognizes stock-based expense related to stock options and restricted stock unit awards on a straight-line basis, net of estimated forfeitures, over the requisite service period of the awards, which is generally the vesting term of three or four years. These awards are measured at fair value as of the grant date and the assumptions used to calculate the fair value of options or restricted stock units are evaluated and revised, as necessary, to reflect market conditions and the Company's experience. Fair Value of Financial Instruments The “Fair Value Measurements and Disclosures” topic of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) establishes a valuation hierarchy for disclosure of the inputs used to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows: Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument; and Level 3 inputs are unobservable inputs based on the Company’s assumptions used to measure assets and liabilities at fair value. A financial asset’s or liability’s classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. As of March 31, 2018 and 2017 and December 31, 2017 , the Company’s investments consisted of only money market funds, which are the Company’s primary financial instruments, maintained in cash equivalents and carried at cost, approximating fair value, based on Level 1 inputs. The balances of the Company's primary financial instruments at the dates indicated were as follows: At March 31, At December 31, (in thousands) 2018 2017 2017 Money market funds $ 5,437 $ 3,545 $ 5,293 The carrying amounts of trade accounts receivable, accounts payable and accrued liabilities approximate fair value due to the short-term nature of these instruments. The fair value of the Company’s contingent consideration related to acquisitions is classified as Level 3 within the fair value hierarchy as it is based on unobserved inputs, management estimates and entity-specific assumptions and is evaluated on an ongoing basis. As of March 31, 2018 , the estimated fair value of the Company's contingent consideration was approximately $1.4 million . Income Taxes The Company uses an estimated annual tax rate to measure the tax benefit or tax expense recognized in each interim period. Acquisitions Under the business combinations topic of the FASB ASC 805, the Company accounts for acquisitions as business combinations and ascribes acquisition-date fair values to the acquired assets and assumed liabilities. Provisional fair value measurements are made at the time of the acquisitions. Adjustments to those measurements may be made in subsequent periods, up to one year from the acquisition date, as information necessary to complete the analysis is obtained. The fair value of intangible assets are generally based on Level 3 inputs. CG Visions, Inc. In January 2017, the Company acquired CG Visions, Inc. ("CG Visions") for up to approximately $20.8 million , including contingent consideration. CG Visions provides scalable technologies and services in building information modeling ("BIM") technologies, estimation tools and software solutions to a number of the top 100 mid-sized to large builders in the United States, which are expected to complement and support the Company's sales in North America. During the third quarter of 2017, the Company finalized its fair value measurement of assets acquired and liabilities assumed in this acquisition. CG Visions assets and liabilities included other current assets of $0.5 million , noncurrent assets of $20.4 million , and current liabilities and contingent consideration of $1.1 million . Included in noncurrent assets was goodwill of $10.1 million , which was assigned to the North America segment, and intangible assets of $10.3 million , both of which are subject to tax-deductible amortization. The estimated weighted-average amortization period for the intangible assets is 7 years. Gbo Fastening Systems AB In January 2017, the Company acquired Gbo Fastening Systems AB ("Gbo Fastening Systems"), a Sweden limited company, for approximately $10.2 million . Gbo Fastening Systems manufactures and sells a complete line of CE-marked structural fasteners as well as fastener dimensioning software for wood construction applications, currently sold mostly in northern and eastern Europe, which are expected to complement the Company's line of wood construction products in Europe. Gain (Adjustment) on Bargain Purchase of a Business In the first quarter of 2017, the Company recorded a preliminary nontaxable bargain purchase gain of $8.4 million , which was included in the condensed consolidated statements of operations. During the third quarter of 2017, the Company reevaluated the fair value of the assets acquired and liabilities assumed in the Gbo Fastening Systems acquisition and recorded that the estimated fair value of the assets acquired and liabilities assumed was approximately $16.5 million . Consequently, a bargain purchase adjustment of $2.1 million was recorded resulting in a $6.3 million adjusted gain on bargain purchase of a business for the 2017 fiscal year. The following table represents the final allocation of the purchase price to the estimated fair value of the assets acquired and liabilities assumed in the Gbo Fastening Systems acquisition: (In thousands) Assets * Cash and cash equivalents $ 3,956 Accounts receivable 4,914 Inventory 13,591 Other current assets 760 Property, plant, equipment and noncurrent assets 3,929 27,150 Liabilities Accounts payable 4,500 Other current liabilities 6,146 10,646 Total net assets 16,504 Gain (adjustment) on bargain purchase of a business (6,336 ) Total purchase price $ 10,168 * Intangible assets acquired were determined to have little to no value, thus were not recognized . Recently Adopted Accounting Standards In October 2016, the FASB issued Accounting Standards Update No. 2016-16, Income Taxes (Topic 740), Intra-Entity Transfers of Assets Other Than Inventory ("ASU 2016-16"), which requires companies to account for the income tax effects of intercompany sales and transfers of assets other than inventory when the transfer occurs. Current guidance requires companies to defer the income tax effects of intercompany transfers of assets until the asset has been sold to an outside party or otherwise recognized. On January 1, 2018, the Company adopted ASU 2016-16 using a modified retrospective approach. Adoption of ASU 2016-16 has had no material effect on the Company's consolidated financial statements and footnote disclosures. In January 2017, the FASB issued Accounting Standards Update No. 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment ("ASU 2017-04"), which eliminates the requirement to calculate the implied fair value of goodwill to measure a goodwill impairment charge or Step 2 of the goodwill impairment analysis. Instead, an impairment charge will be recorded based on the excess of a reporting unit's carrying amount over its fair value using Step 1 of the goodwill impairment analysis. On January 1, 2018, the Company prospectively adopted ASU 2017-04. Adoption of ASU 2017-04 has had no material effect on the Company's consolidated financial statements and footnote disclosures. Recently Issued Accounting Standards Not Yet Adopted In February 2016, the FASB issued Accounting Standards Update No. 2016-02, (Topic 842), Leases (“ASU 2016-02”). ASU 2016-02 core requirement is to recognize the assets and liabilities that arise from leases including those leases classified as operating leases. The amendments require a lessee to recognize a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term in the statement of financial position. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset to not recognize lease assets and lease liabilities. If a lessee makes this election, it should recognize lease expense for such leases generally on a straight-line basis over the lease term. In transition, lessees are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted. The Company has developed a project team relative to the process of adopting this ASU 2016-02 and is currently reviewing the detail of the Company’s leasing arrangements, which consist primarily of building, auto and equipment leases. As of December 31, 2017, the Company determined an estimated $25.2 million operating lease commitment will have an impact on the Company's balance sheets. In February 2018, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2018-02, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (ASU 2018-02) . ASU 2018-02 allows a reclassification from Accumulated other Comprehensive Income to Retained Earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act of 2017. The amendments in this ASU are effective for fiscal years beginning after December 15, 2018 and for interim periods therein. Early adoption of ASU 2018-02 is permitted. The Company is evaluating the impact of adopting this new accounting guidance on its consolidated financial statements All other issued and effective accounting standards during the first quarter of 2018 were determined to be not relevant or material to the Company. |
Revenue from Contract with Cust
Revenue from Contract with Customer | 3 Months Ended |
Mar. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contract with Customer | Revenue from Contracts with Customers On January 1, 2018, the Company adopted the New Revenue Standard ("ASC 606") using the modified retrospective method and has recorded $0.8 million , net of tax, cumulative effect of adopting ASC 606 as an increase to opening retained earnings on January 1, 2018. Disaggregated revenue In accordance with ASC 606, the Company disaggregates net sales into the following major product groups as noted in Note 12 segment information of these interim financial statements. Wood Construction Products Revenue . Wood construction products represented almost 87% of total net sales in the first quarter of 2018, refer to Note 12 for products description. Concrete Construction Products Revenue. Concrete construction products represented 13% of total net sales in the first quarter of 2018, refer to Note 12 for products description. Generally, a revenue contract with a customer exists when the goods are shipped and services are rendered; and its related invoice is generated. The duration of the contract does not extend beyond the promised goods or services already transferred. The transaction price of each distinct promised product or service specified in the invoice is based on its relative stated standalone selling price. All revenues are measured based on the consideration specified in the invoice with a customer, excluding any sales incentives, discounts and amounts collected on behalf of third parties (i.e. governmental tax authorities). Based on the Company's historical experience with the customer and with the customer's purchasing pattern and its significant experience selling products, the Company concluded that a significant reversal in the cumulative amount of revenue recognized will not occur when the uncertainty (if any) is resolved (that is, when the total amount of purchases is known).The Company recognizes revenue when it satisfies a performance obligation by transferring control over a product to a customer at a point in time. The Company’s shipping terms provide the primary indicator of the transfer of control. Generally, our general shipping terms are F.O.B. shipping point, where title and the risk and rewards of ownership transfer at the point when the products leave our warehouse. Generally, there are no customer acceptance criteria included in our standard sales agreement with customers. When an arrangement with the customer does not meet the criteria to be accounted for as a revenue contract under the standard, the Company recognizes revenue in the amount of nonrefundable consideration received when the Company has transferred control of the goods or services and has stopped transferring (and has no obligation to transfer) additional goods or services. The Company offers certain customers discounts for paying invoices ahead of the due date, generally, 30 to 60 days. Many of the Company's customers have prompt-payment discount terms. Other revenue . Service sales, representing after-market repair and maintenance, engineering activities and software license sales and services, although less than 1.0% of net sales and not material to the condensed consolidated financial statements, are recognized as the services are completed or the software products and services are delivered. Services may be sold separately or in bundled packages. The typical contract length for service is generally less than one year. For bundled packages, the Company accounts for individual services separately if they are distinct. A distinct service is separately identifiable from other items in the bundled package if a customer can benefit from it on its own or with other resources that are readily available to the customer. The consideration (including any discounts) is allocated between separate services in a bundle based on their stand-alone selling prices. The stand-alone selling prices are determined based on the prices at which the Company separately sells the services. Reconciliation of contract balances Contract assets are the rights to consideration in exchange for goods or services that the Company has transferred to a customer when that right is conditional on something other than the passage of time. Contract liabilities are recorded for any services billed to customers and not yet recognizable if the contract period has commenced or for the amount collected from customers in advance of the contract period commencing. As of January 1, 2018, the Company had no contract assets and deferred revenue which represent contract liabilities from contracts with customers . Other accounting issues Volume discounts. Volume discounts are accounted for as variable consideration because the transaction price is uncertain until the customer completes or fails to purchase the specified volume of purchases (consideration is contingent on a future outcome - occurrence or nonoccurrence). In addition, the Company applies the volume rebate or discount retrospectively, this is because the final price of each products or services sold depends on the customer's total purchases subject to the rebate program. The estimated rebates are deducted from the transaction price revenues based on the historical experience with the customer. Right of returns and other allowances. Rights of return creates variability in the transaction price. The Company accounts for returned product during the return period as a refund to customer, not a performance obligation. The estimated allowance for returns is based on historical percentage of returns and allowance from prior periods and the customer's historical purchasing pattern. This estimate is deducted from the transaction price revenues. Principal versus Agent. The Company considered the principal versus agent consideration of the new revenue recognition guidance and concluded that the Company is the principal in a third-party transaction. The Company manufactures its products and has the control to transfer of the products to Dealer Distributors and Contract Distributors, or directly ship our products to the customers. Costs to obtain or fulfill a contract. Costs incurred to obtain a contract is immaterial. Commission cost is not an incremental cost directly related to obtain a contract. Shipping costs. T he Company recognizes shipping and handling activities that occur after the customer has obtained control of goods as a fulfillment cost rather than as an additional promised service. Therefore, the Company recognizes revenue and accrues the shipping and handling costs when the control of goods transfers to the customer upon shipment. Advertising costs. Cooperative advertising and partnership discounts are consideration payable to a customer and not a payment in exchange for a distinct product or service at fair value. Estimated cooperative advertising and partnership discounts are reductions to the transaction price. Practical Expedients. The Company did not use either the practical expedient regarding the existence of a significant financing component or the practical expedient for expensing certain costs of obtaining a contract. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes On December 22, 2017, the U.S. Tax Cuts and Jobs Act of 2017 (the “Tax Reform Act”) was signed, which includes a broad range of tax reform proposals affecting businesses, including corporate tax rates, business deductions, and international tax provisions. On April 2, 2018, the Internal Revenue Service issued Notice 2018-26 which provides guidance on how to determine, report and pay the repatriation tax on deemed repatriated earnings of foreign subsidiaries provided in the Tax Reform Act and included in the consolidated financial statements for the year ended December 31, 2017. ASU 2018-26 is not expected to have a significant impact on the Company’s consolidated financial statements. Income tax expense Three Months Ended March 31, (in thousands, except percentages) 2018 2017 Effective tax rate 22.2 % 24.9 % Provision for income taxes $ 7,253 $ 7,680 Income tax expense decreased $0.4 million for the three months ended March 31, 2018, compared to the same period in 2017, due to a lower effective tax rate in spite of higher pre-tax income. The decrease in the effective tax rate was primarily due to the reduced U.S. corporate income tax rate from a maximum of 35% to a 21% rate provided in the Tax Reform Act. Although not significant, the Company’s effective tax rate includes the estimated incremental GILTI tax expense applying the tax law as currently enacted. The $23.1 million consolidated net income for the first quarter of 2017 included an $8.4 million gain on a bargain purchase of a business. |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation The Company allocates stock-based compensation expense related to equity plans for employees and non-employee directors among cost of sales, research and development and other engineering expense, selling expense, or general and administrative expense based on the job functions performed by the employees to whom the stock-based compensation is awarded. During the three months ended March 31, 2018 and 2017 , the Company recognized stock-based compensation expense related to its equity plans for employees of $3.1 million and $8.0 million , respectively. Stock-based compensation cost capitalized in inventory was immaterial for all periods presented. On February 15, 2018, the Company granted 176,882 restricted stock units ("RSUs") to the Company's employees, including officers, at an estimated weighted average fair value of $54.97 per share, based on the closing price of the Company's common stock on February 14, 2018 of $57.16 , adjusted for certain market factors, and to a lesser extent, the present value of dividends. The RSUs granted to the Company's employees may be time-based, performance-based or time- and performance-based. Certain of the performance-based RSUs are granted to officers and key employees, where the number of performance-based awards to be issued is based on the achievement of certain Company performance criteria established in the RSU agreement over a cumulative three year period. These awards cliff vest after three years. In addition, these same officers and key employees also receive time-based RSUs, which vest pursuant to a three -year graded vesting schedule. Time- and performance based RSUs are granted to the Company's employees excluding officers and certain key employees, vest ratably over the four year life of the award, and require the underlying shares of the Company's common stock to be subject to a performance-based adjustment during the first year. On April 24, 2018, the Company awarded 1,475 fully vested shares to each of the Company's eight non-employee directors ( 11,800 shares in total) at an estimated fair value of $55.34 per share based on the closing price on April 24, 2018. As of March 31, 2018 , the aggregate unamortized stock compensation expense was approximately $16.9 million , which is entirely attributable to unvested RSUs and is expected to be recognized in expense over a weighted-average period of 2.5 years. |
Trade Accounts Receivable, Net
Trade Accounts Receivable, Net | 3 Months Ended |
Mar. 31, 2018 | |
Receivables [Abstract] | |
Trade Accounts Receivable, Net | Trade Accounts Receivable, Net Trade accounts receivable at the dates indicated consisted of the following: At March 31, At December 31, (in thousands) 2018 2017 2017 Trade accounts receivable $ 169,552 $ 153,542 $ 139,910 Allowance for doubtful accounts (1,217 ) (1,284 ) (996 ) Allowance for sales discounts and returns (1,189 ) (3,752 ) (2,956 ) $ 167,146 $ 148,506 $ 135,958 The decrease in allowance for sales discounts and returns is primarily related to the adoption of ASC 606 resulting in a $1.1 million adjustment in recognition of estimated right of returns assets on product sales and its corresponding estimated refund liability as of December 31, 2017, which was not recordable under previous revenue recognition guidance. This amount was estimated based upon the most likely amount of consideration to which the customer will be entitled. All estimates are based on historical experience, anticipated performance and the Company’s best judgment at the time to the extent it is probable that a significant reversal of revenue recognized will not occur. These estimates are reassessed periodically. |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2018 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories at the dates indicated consisted of the following: At March 31, At December 31, (in thousands) 2018 2017 2017 Raw materials $ 87,363 $ 90,545 $ 91,022 In-process products 28,406 26,010 26,849 Finished products 140,783 139,716 135,125 $ 256,552 $ 256,271 $ 252,996 |
Property, Plant and Equipment,
Property, Plant and Equipment, Net | 3 Months Ended |
Mar. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment, Net | Property, Plant and Equipment, Net Property, plant and equipment, net, at the dates indicated consisted of the following: At March 31, At December 31, (in thousands) 2018 2017 2017 Land $ 33,234 $ 32,370 $ 33,087 Buildings and site improvements 214,074 186,974 212,817 Leasehold improvements 4,767 5,515 4,684 Machinery, equipment, and software 318,201 254,405 300,334 570,276 479,264 550,922 Less accumulated depreciation and amortization (309,198 ) (279,607 ) (299,907 ) 261,078 199,657 251,015 Capital projects in progress 15,036 50,808 22,005 $ 276,114 $ 250,465 $ 273,020 |
Goodwill and Intangible Assets,
Goodwill and Intangible Assets, Net | 3 Months Ended |
Mar. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets, Net | Goodwill and Intangible Assets, Net Goodwill at the dates indicated was as follows: At March 31, At December 31, (in thousands) 2018 2017 2017 North America $ 95,677 $ 95,574 $ 95,755 Europe 40,883 38,080 39,896 Asia/Pacific 1,466 1,459 1,489 Total $ 138,026 $ 135,113 $ 137,140 Intangible assets, net, at the dates indicated were as follows: At March 31, 2018 Gross Net Carrying Accumulated Carrying (in thousands) Amount Amortization Amount North America $ 30,715 $ (14,472 ) $ 16,243 Europe 24,112 (12,053 ) 12,059 Total $ 54,827 $ (26,525 ) $ 28,302 At March 31, 2017 Gross Net (in thousands) Carrying Amount Accumulated Amortization Carrying Amount North America $ 33,862 $ (14,815 ) $ 19,047 Europe 28,110 (15,444 ) 12,666 Total $ 61,972 $ (30,259 ) $ 31,713 At December 31, 2017 Gross Net (in thousands) Carrying Amount Accumulated Amortization Carrying Amount North America $ 30,775 $ (13,732 ) $ 17,043 Europe 23,762 (11,479 ) 12,283 Total $ 54,537 $ (25,211 ) $ 29,326 Intangible assets consist of definite-lived and indefinite-lived assets. Definite-lived intangible assets include customer relationships, patents, unpatented technology and non-compete agreements. Amortization expense for definite-lived intangible assets during the three months ended March 31, 2018 and 2017 , totaled $1.3 million and $1.7 million , respectively. The only indefinite-lived intangible asset, consisting of a trade name, totaled $0.6 million at March 31, 2018 . At March 31, 2018 , the estimated future amortization of definite-lived intangible assets was as follows: (in thousands) Remaining nine months of 2018 $ 4,048 2019 5,311 2020 5,281 2021 4,802 2022 2,878 2023 2,074 Thereafter 3,292 $ 27,686 The changes in the carrying amount of goodwill and intangible assets for the three months ended March 31, 2018 , were as follows: Intangible (in thousands) Goodwill Assets Balance at December 31, 2017 $ 137,140 $ 29,326 Amortization — (1,314 ) Foreign exchange 886 290 Balance at March 31, 2018 $ 138,026 $ 28,302 |
Investments
Investments | 3 Months Ended |
Mar. 31, 2018 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investments | Investments On December 23, 2016, the Company acquired a 25.0% equity interest in Ruby Sketch Pty Ltd. (“Ruby Sketch”), an Australian proprietary limited company, for $2.5 million , for which the Company accounts for its ownership interest using the equity accounting method. Ruby Sketch develops software that assists in designing residential structures, primarily used in Australia, and potentially for the North America market. The Company has no obligation to make any additional capital contributions to Ruby Sketch. For the three months ended March 31, 2018 and 2017 , the Company recorded an equity loss of $24 thousand and $28 thousand , respectively. The carrying amount of the investment as of March 31, 2018 and December 31, 2017 was $2.5 million . |
Debt
Debt | 3 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
Debt | Debt Credit Facilities The Company has revolving lines of credit with various banks in the United States and Europe. Total available credit at March 31, 2018 , was $304.2 million including revolving credit lines and an irrevocable standby letter of credit in support of various insurance deductibles. The Company’s primary credit facility is a revolving line of credit with $300 million in available credit. On July 25, 2016, the Company entered into a second amendment (the "Amendment") to the credit facility. For additional information about the Amendment, see the Company's Current Report on Form 8-K dated July 28, 2016. As amended, this credit facility will expire on July 23, 2021. Amounts borrowed under this credit facility bear interest at an annual rate equal to either, at the Company’s option, (a) the rate for Eurocurrency deposits for the corresponding deposits of U.S. dollars appearing on Reuters LIBOR1screen page (the “LIBOR Rate”), adjusted for any reserve requirement in effect, plus a spread of 0.60% to 1.45% , determined quarterly based on the Company’s leverage ratio (at March 31, 2018 , the LIBOR Rate was 1.80% ), or (b) a base rate , plus a spread of 0.00% to 0.45% , determined quarterly based on the Company’s leverage ratio. The base rate is defined in a manner such that it will not be less than the LIBOR Rate. The Company will pay fees for standby letters of credit at an annual rate equal to the applicable spread described above, and will pay market-based fees for commercial letters of credit. The Company is required to pay an annual facility fee of 0.15% to 0.30% of the available commitments under the credit facility, regardless of usage, with the applicable fee determined on a quarterly basis based on the Company’s leverage ratio. The Company’s unused borrowing capacity under other revolving credit lines and a term note totaled $4.2 million at March 31, 2018 . The other revolving credit lines and the term note charge interest ranging from 0.47% to 11.50% , currently have maturity dates from July 2018 to December 2018. The Company had no outstanding debt balance as of March 31, 2018 and 2017 , and December 31, 2017 , respectively. The Company was in compliance with its financial covenants at March 31, 2018 . Capital Lease Obligations In 2017, the Company entered into two four -year lease agreements for certain office equipment with Cisco Systems Capital Corporation for a total of approximately $4.4 million , which was recorded in fixed assets as capital lease obligations. These capital lease obligations are included in current liabilities and other long-term liabilities in the accompanying condensed consolidated balance sheets. The interest rates for these two capital leases are 2.89% and 3.50% , respectively, and the two leases will mature in May 2021 and July 2021, respectively. As of March 31, 2018 , the current portion of the outstanding liability for the leased equipment was approximately $1.1 million and the long-term portion was approximately $2.4 million . |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information The Company is organized into three reportable segments, which are defined by the regions where the Company’s products are manufactured, marketed and distributed to the Company’s customers. The three regional segments are the North America segment, comprising primarily the United States and Canada; the Europe segment, comprising continental Europe and the United Kingdom; and the Asia/Pacific segment, comprising the Company’s operations in China, Hong Kong, the South Pacific, South Africa and the Middle East. China and Hong Kong operations are manufacturing and administrative support locations, respectively. These three reportable segments are similar in several ways, including the types of materials used in production, production processes, distribution channels and product applications. The Company’s measure of profit or loss for its reportable segments is income (loss) from operations. The following tables illustrate certain measurements used by management to assess the performance of its reportable segments as of or for the following periods: Three Months Ended March 31, (in thousands) 2018 2017 Net Sales North America $ 206,212 $ 183,772 Europe 36,293 34,381 Asia/Pacific 2,274 1,714 Total $ 244,779 $ 219,867 Sales to Other Segments* North America $ 628 $ 850 Europe 349 147 Asia/Pacific 6,524 4,949 Total $ 7,501 $ 5,946 Income (Loss) from Operations North America $ 35,968 $ 26,767 Europe (1,647 ) (1,835 ) Asia/Pacific 151 (195 ) Administrative and all other (1,676 ) (2,107 ) Total $ 32,796 $ 22,630 * Sales to other segments are eliminated in consolidation. At At March 31, December 31, (in thousands) 2018 2017 2017 Total Assets North America $ 982,149 $ 877,408 $ 953,033 Europe 213,259 187,614 208,640 Asia/Pacific 28,461 25,944 26,820 Administrative and all other (183,527 ) (72,766 ) (150,970 ) Total $ 1,040,342 $ 1,018,200 $ 1,037,523 Cash collected by the Company’s United States subsidiaries is routinely transferred into the Company’s cash management accounts and, therefore, has been included in the total assets of “Administrative and all other.” Cash and cash equivalent balances in the “Administrative and all other” segment were $53.4 million , $92.1 million , and $80.2 million , as of March 31, 2018 and 2017 , and December 31, 2017 , respectively. Total "Administrative and all other" assets are net of inter-segment due to and from accounts eliminated in consolidation. While the Company manages its business by geographic segment, the following table illustrates the distribution of the Company’s net sales by product group as additional information for the following periods: Three Months Ended March 31, (in thousands) 2018 2017 Wood construction products $ 212,547 $ 190,877 Concrete construction products 32,156 28,817 Other 76 173 Total $ 244,779 $ 219,867 Wood construction products include connectors, truss plates, fastening systems, fasteners and pre-fabricated shearwalls, and are used for connecting and strengthening wood-based construction primarily in the residential construction market. Concrete construction products include adhesives, chemicals, mechanical anchors, carbide drill bits, powder actuated tools and fiber reinforcing materials, and are used for restoration, protection or strengthening concrete, masonry and steel construction in residential, industrial, commercial and infrastructure construction. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Litigation From time to time, the Company is involved in various legal proceedings and other matters arising in the normal course of business. Corrosion, hydrogen embrittlement, cracking, material hardness, wood pressure-treating chemicals, misinstallations, misuse, design and assembly flaws, manufacturing defects, labeling defects, product formula defects, inaccurate chemical mixes, adulteration, environmental conditions, or other factors can contribute to failure of fasteners, connectors, anchors, adhesives, specialty chemicals, such as fiber reinforced polymers, and tool products. In addition, inaccuracies may occur in product information, descriptions and instructions found in catalogs, packaging, data sheets, and the Company’s website. As of the date of this Quarterly Report on Form 10-Q, the Company is not a party to any legal proceedings, which the Company expects individually or in the aggregate to have a material adverse effect on the Company’s financial condition, cash flows or results of operations. Nonetheless, the resolution of any claim or litigation is subject to inherent uncertainty and could have a material adverse effect on the Company’s financial condition, cash flows or results of operations. Gentry Homes, Ltd.v. Simpson Strong-Tie Company, Inc., et al. , Case No. 17-cv-00566, was filed in federal district court in Hawaii against Simpson Strong-Tie Company, Inc. and Simpson Manufacturing, Inc. on November 20, 2017. The Gentry case is a product of a previous state court class action, Nishimura v. Gentry Homes, Ltd.,et al. which is now closed. The Nishimura case concerned alleged corrosion of the Company’s galvanized strap-tie holdowns and mudsill anchor products used in a residential project in Honolulu, Hawaii, Ewa by Gentry. In the Nishimura case, the plaintiff homeowners and the developer, Gentry, arbitrated their dispute and agreed on a settlement in the amount of $90 million , with $54 million going to repair costs and $36 million going to attorney fees. In the Gentry case, Gentry alleges breach of warranty and negligent misrepresentation related to the Company’s “hurricane strap” and mudsill anchor products. Gentry is demanding general, special, and consequential damages from the Company in an amount to be proven at trial. Gentry also seeks pre-judgment and post-judgment interest, attorneys’ fees and costs, and other relief. The Company admits no liability and will vigorously defend the claims bought against it. At this time, the Company cannot reasonably ascertain the likelihood that it will be found responsible for substantial damages to Gentry. Based on the facts currently known, and subject to future events and circumstances, the Company believes that all or part of the claims may be covered by its insurance policies. Potential Third-Party Claims Charles Vitale, et al. v. D.R. Horton, Inc. and D.R. Horton-Schuler Homes, LLC , Civil No. 15-1-1347-07, a putative class action lawsuit, was filed in the Hawaii First Circuit on July 13, 2015, in which homeowner plaintiffs allege that all homes built by D.R Horton/D.R. Horton-Schuler Homes (collectively "Horton Homes") in the State of Hawaii have strap-tie holdowns that are suffering premature corrosion. The complaint alleges that various manufacturers make strap-tie holdowns that suffer from such corrosion, but does not identify the Company’s products specifically. The Company is not currently a party to the Vitale lawsuit, but the lawsuit in the future could potentially involve the Company’s strap-tie holdowns. If claims are asserted against the Company in the Vitale case, it will vigorously defend any such claims, whether brought by the plaintiff homeowners, or third party claims by Horton Homes. Based on facts currently known to the Company and subject to future events and circumstances, the Company believes that all or part of any claims that any party might seek to allege against it related to the Vitale case may be covered by its insurance policies. Given the nature and the complexities involved in the Vitale proceeding the Company is unable to estimate reasonably a likelihood of possible loss or range of possible loss until the Company knows, among other factors, (i) whether it will be named in the lawsuit by any party; (ii) the specific claims and the legal theories on which they are based (iii) what claims, if any, might be dismissed without trial, (iv) the extent of the claims, including the size of any potential class, particularly as damages are not specified or are indeterminate, (v) how the discovery process will affect the litigation, (vi) the settlement posture of the other parties to the litigation, (vii) the extent to which the Company’s insurance policies will cover the claims or any part thereof, if at all, (viii) whether class treatment is appropriate; and (ix) any other factors that may have a material effect on the litigation. While it is not feasible to predict the outcome of proceedings to which the Company is not currently a party, or reasonably estimate a possible loss or range of possible loss for the Company related to such matters, in the opinion of the Company, either the likelihood of loss from such proceedings is remote or any reasonably possible loss associated with the resolution of such proceedings is not expected to be material to the Company’s financial position, results of operations or cash flows either individually or in the aggregate. Nonetheless, the resolution of any claim or litigation is subject to inherent uncertainty and could have a material adverse effect on the Company’s financial condition, cash flows or results of operations. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events In April 2018, the Company’s Board of Directors declared a quarterly cash dividend of $0.22 per share, estimated to be $10.2 million in total, to be paid on July 26, 2018 , to stockholders of record on July 5, 2018 . This increased 5% over the last dividend declared by the Company in January 2018. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Principles of Consolidation | Principles of Consolidation The condensed consolidated financial statements include the accounts of Simpson Manufacturing Co., Inc. and its subsidiaries (collectively, the “Company”). There were no investments in affiliates that would render such affiliates to be considered variable interest entities. All significant intercompany transactions have been eliminated. |
Interim Period Reporting | Interim Reporting Period The accompanying unaudited interim condensed consolidated financial statements have been prepared pursuant to the rules and regulations for reporting on Form 10-Q. Accordingly, certain information and footnotes required by accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted. These interim statements should be read in conjunction with the audited consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2017 . The unaudited quarterly condensed consolidated financial statements have been prepared on the same basis as the audited annual consolidated financial statements and, in the opinion of management, contain all adjustments (consisting of only normal recurring adjustments) necessary to state fairly the financial information set forth therein, in accordance with GAAP. Certain prior period amounts in the condensed consolidated financial statements and the accompanying notes have been reclassified to conform to the current period’s presentation. The year-end condensed consolidated balance sheet data provided herein were derived from audited financial statements, but do not include all disclosures required by GAAP. The Company’s quarterly results fluctuate. As a result, the Company believes the results of operations for this interim period presented are not indicative of the results to be expected for any future periods. |
Revenue Recognition | Revenue Recognition In May 2014, the FASB issued Accounting Standards Update No. 2014-09 (later codified as ASC Topic 606), Revenue from Contracts with Customers , which supersedes nearly all existing revenue recognition guidance under GAAP. ASC 606 provides a five-step model for revenue recognition to be applied to all revenue contracts with customers. Under ASC 606, the revenue is recognized when a customer obtains control of promised goods or services and in an amount that reflects the consideration the entity expects to receive in exchange for those goods or services. The Company adopted ASU 2014-09 and its related amendments, effective January 1, 2018 using the modified retrospective implementation method. Accordingly, the Company applied the five-step method outlined in Topic 606 for determining when and how revenue is recognized to all contracts. Revenues for reporting periods beginning after January 1, 2018 are presented under Topic 606. While Topic 606 requires additional disclosure about the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers, including significant judgments and changes in judgments, its adoption has not had a material impact on the measurement or recognition of the Company’s revenues. In addition, the adoption of Topic 606 had no material impact to cash from or used in operating, financing, or investing on the consolidated cash flows statements (See “Note 2 - Revenue from Contracts with Customers" to the Company's Consolidated Financial Statements). |
Net Earnings Per Common Share | Net Earnings Per Common Share Basic earnings per common share are computed based on the weighted-average number of common shares outstanding during the period. Potentially dilutive securities, using the treasury stock method, are included in the diluted per-share calculations for all periods when the effect of their inclusion is dilutive. |
Accounting for Stock-Based Compensation | Accounting for Stock-Based Compensation The Company recognizes stock-based expense related to stock options and restricted stock unit awards on a straight-line basis, net of estimated forfeitures, over the requisite service period of the awards, which is generally the vesting term of three or four years. These awards are measured at fair value as of the grant date and the assumptions used to calculate the fair value of options or restricted stock units are evaluated and revised, as necessary, to reflect market conditions and the Company's experience. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The “Fair Value Measurements and Disclosures” topic of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) establishes a valuation hierarchy for disclosure of the inputs used to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows: Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument; and Level 3 inputs are unobservable inputs based on the Company’s assumptions used to measure assets and liabilities at fair value. A financial asset’s or liability’s classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. As of March 31, 2018 and 2017 and December 31, 2017 , the Company’s investments consisted of only money market funds, which are the Company’s primary financial instruments, maintained in cash equivalents and carried at cost, approximating fair value, based on Level 1 inputs. The balances of the Company's primary financial instruments at the dates indicated were as follows: At March 31, At December 31, (in thousands) 2018 2017 2017 Money market funds $ 5,437 $ 3,545 $ 5,293 The carrying amounts of trade accounts receivable, accounts payable and accrued liabilities approximate fair value due to the short-term nature of these instruments. The fair value of the Company’s contingent consideration related to acquisitions is classified as Level 3 within the fair value hierarchy as it is based on unobserved inputs, management estimates and entity-specific assumptions and is evaluated on an ongoing basis. As of March 31, 2018 , the estimated fair value of the Company's contingent consideration was approximately $1.4 million . |
Income Taxes | |
Acquisitions | Acquisitions Under the business combinations topic of the FASB ASC 805, the Company accounts for acquisitions as business combinations and ascribes acquisition-date fair values to the acquired assets and assumed liabilities. Provisional fair value measurements are made at the time of the acquisitions. Adjustments to those measurements may be made in subsequent periods, up to one year from the acquisition date, as information necessary to complete the analysis is obtained. The fair value of intangible assets are generally based on Level 3 inputs |
Recently Issued Accounting Standards | Recently Adopted Accounting Standards In October 2016, the FASB issued Accounting Standards Update No. 2016-16, Income Taxes (Topic 740), Intra-Entity Transfers of Assets Other Than Inventory ("ASU 2016-16"), which requires companies to account for the income tax effects of intercompany sales and transfers of assets other than inventory when the transfer occurs. Current guidance requires companies to defer the income tax effects of intercompany transfers of assets until the asset has been sold to an outside party or otherwise recognized. On January 1, 2018, the Company adopted ASU 2016-16 using a modified retrospective approach. Adoption of ASU 2016-16 has had no material effect on the Company's consolidated financial statements and footnote disclosures. In January 2017, the FASB issued Accounting Standards Update No. 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment ("ASU 2017-04"), which eliminates the requirement to calculate the implied fair value of goodwill to measure a goodwill impairment charge or Step 2 of the goodwill impairment analysis. Instead, an impairment charge will be recorded based on the excess of a reporting unit's carrying amount over its fair value using Step 1 of the goodwill impairment analysis. On January 1, 2018, the Company prospectively adopted ASU 2017-04. Adoption of ASU 2017-04 has had no material effect on the Company's consolidated financial statements and footnote disclosures. |
Basis of Presentation (Tables)
Basis of Presentation (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Reconciliation of basic earnings per share ("EPS") to diluted EPS | The following is a reconciliation of basic earnings per common share to diluted earnings per share for the three months ended March 31, 2018 and 2017 , respectively: Three Months Ended (in thousands, except per share amounts) 2018 2017 Net income available to common stockholders $ 25,429 $ 23,121 Basic weighted-average shares outstanding 46,615 47,616 Dilutive effect of potential common stock equivalents — stock options and restricted stock units 394 290 Diluted weighted-average shares outstanding 47,009 47,906 Earnings per common share: Basic $ 0.55 $ 0.49 Diluted $ 0.54 $ 0.48 |
Stock option and restricted stock unit activity of the entity | |
Summary of financial instruments | As of March 31, 2018 and 2017 and December 31, 2017 , the Company’s investments consisted of only money market funds, which are the Company’s primary financial instruments, maintained in cash equivalents and carried at cost, approximating fair value, based on Level 1 inputs. The balances of the Company's primary financial instruments at the dates indicated were as follows: At March 31, At December 31, (in thousands) 2018 2017 2017 Money market funds $ 5,437 $ 3,545 $ 5,293 |
Schedule of effective tax rates and income tax expense | |
Schedule of business acquisitions | The following table represents the final allocation of the purchase price to the estimated fair value of the assets acquired and liabilities assumed in the Gbo Fastening Systems acquisition: (In thousands) Assets * Cash and cash equivalents $ 3,956 Accounts receivable 4,914 Inventory 13,591 Other current assets 760 Property, plant, equipment and noncurrent assets 3,929 27,150 Liabilities Accounts payable 4,500 Other current liabilities 6,146 10,646 Total net assets 16,504 Gain (adjustment) on bargain purchase of a business (6,336 ) Total purchase price $ 10,168 * Intangible assets acquired were determined to have little to no value, thus were not recognized . |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of provision for income taxes from continuing operations | Income tax expense Three Months Ended March 31, (in thousands, except percentages) 2018 2017 Effective tax rate 22.2 % 24.9 % Provision for income taxes $ 7,253 $ 7,680 |
Trade Accounts Receivable, Net
Trade Accounts Receivable, Net (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Receivables [Abstract] | |
Schedule of trade accounts receivable, net | Trade accounts receivable at the dates indicated consisted of the following: At March 31, At December 31, (in thousands) 2018 2017 2017 Trade accounts receivable $ 169,552 $ 153,542 $ 139,910 Allowance for doubtful accounts (1,217 ) (1,284 ) (996 ) Allowance for sales discounts and returns (1,189 ) (3,752 ) (2,956 ) $ 167,146 $ 148,506 $ 135,958 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Inventory Disclosure [Abstract] | |
Schedule of carrying values of inventories | Inventories at the dates indicated consisted of the following: At March 31, At December 31, (in thousands) 2018 2017 2017 Raw materials $ 87,363 $ 90,545 $ 91,022 In-process products 28,406 26,010 26,849 Finished products 140,783 139,716 135,125 $ 256,552 $ 256,271 $ 252,996 |
Property, Plant and Equipment26
Property, Plant and Equipment, Net (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property, plant and equipment | Property, plant and equipment, net, at the dates indicated consisted of the following: At March 31, At December 31, (in thousands) 2018 2017 2017 Land $ 33,234 $ 32,370 $ 33,087 Buildings and site improvements 214,074 186,974 212,817 Leasehold improvements 4,767 5,515 4,684 Machinery, equipment, and software 318,201 254,405 300,334 570,276 479,264 550,922 Less accumulated depreciation and amortization (309,198 ) (279,607 ) (299,907 ) 261,078 199,657 251,015 Capital projects in progress 15,036 50,808 22,005 $ 276,114 $ 250,465 $ 273,020 |
Goodwill and Intangible Asset27
Goodwill and Intangible Assets, Net (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill, by segment | Goodwill at the dates indicated was as follows: At March 31, At December 31, (in thousands) 2018 2017 2017 North America $ 95,677 $ 95,574 $ 95,755 Europe 40,883 38,080 39,896 Asia/Pacific 1,466 1,459 1,489 Total $ 138,026 $ 135,113 $ 137,140 |
Schedule of net intangible assets, by segment | ntangible assets, net, at the dates indicated were as follows: At March 31, 2018 Gross Net Carrying Accumulated Carrying (in thousands) Amount Amortization Amount North America $ 30,715 $ (14,472 ) $ 16,243 Europe 24,112 (12,053 ) 12,059 Total $ 54,827 $ (26,525 ) $ 28,302 At March 31, 2017 Gross Net (in thousands) Carrying Amount Accumulated Amortization Carrying Amount North America $ 33,862 $ (14,815 ) $ 19,047 Europe 28,110 (15,444 ) 12,666 Total $ 61,972 $ (30,259 ) $ 31,713 At December 31, 2017 Gross Net (in thousands) Carrying Amount Accumulated Amortization Carrying Amount North America $ 30,775 $ (13,732 ) $ 17,043 Europe 23,762 (11,479 ) 12,283 Total $ 54,537 $ (25,211 ) $ 29,326 |
Schedule of estimated future amortization of intangible assets | At March 31, 2018 , the estimated future amortization of definite-lived intangible assets was as follows: (in thousands) Remaining nine months of 2018 $ 4,048 2019 5,311 2020 5,281 2021 4,802 2022 2,878 2023 2,074 Thereafter 3,292 $ 27,686 |
Changes in the carrying amount of goodwill and intangible assets | The changes in the carrying amount of goodwill and intangible assets for the three months ended March 31, 2018 , were as follows: Intangible (in thousands) Goodwill Assets Balance at December 31, 2017 $ 137,140 $ 29,326 Amortization — (1,314 ) Foreign exchange 886 290 Balance at March 31, 2018 $ 138,026 $ 28,302 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
Schedule of performance of reportable segments | The following tables illustrate certain measurements used by management to assess the performance of its reportable segments as of or for the following periods: Three Months Ended March 31, (in thousands) 2018 2017 Net Sales North America $ 206,212 $ 183,772 Europe 36,293 34,381 Asia/Pacific 2,274 1,714 Total $ 244,779 $ 219,867 Sales to Other Segments* North America $ 628 $ 850 Europe 349 147 Asia/Pacific 6,524 4,949 Total $ 7,501 $ 5,946 Income (Loss) from Operations North America $ 35,968 $ 26,767 Europe (1,647 ) (1,835 ) Asia/Pacific 151 (195 ) Administrative and all other (1,676 ) (2,107 ) Total $ 32,796 $ 22,630 * Sales to other segments are eliminated in consolidation. At At March 31, December 31, (in thousands) 2018 2017 2017 Total Assets North America $ 982,149 $ 877,408 $ 953,033 Europe 213,259 187,614 208,640 Asia/Pacific 28,461 25,944 26,820 Administrative and all other (183,527 ) (72,766 ) (150,970 ) Total $ 1,040,342 $ 1,018,200 $ 1,037,523 |
Schedule of net sales distributed by product group | While the Company manages its business by geographic segment, the following table illustrates the distribution of the Company’s net sales by product group as additional information for the following periods: Three Months Ended March 31, (in thousands) 2018 2017 Wood construction products $ 212,547 $ 190,877 Concrete construction products 32,156 28,817 Other 76 173 Total $ 244,779 $ 219,867 |
Basis of Presentation - Prior Y
Basis of Presentation - Prior Year Reclassification (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2018USD ($) | |
Research and Development and Engineering Expense [Member] | |
Change in Accounting Estimate [Line Items] | |
Prior Period Reclassification Adjustment | $ 1.3 |
General and Administrative Expense [Member] | |
Change in Accounting Estimate [Line Items] | |
Prior Period Reclassification Adjustment | 1.1 |
Selling Expense [Member] | |
Change in Accounting Estimate [Line Items] | |
Prior Period Reclassification Adjustment | $ 0.2 |
Basis of Presentation - Reconci
Basis of Presentation - Reconciliation of BEPS (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Reconciliation of basic earnings per share ("EPS") to diluted EPS | |||
Net income available to common stockholders | $ 25,429 | $ 23,121 | $ 69,496 |
Basic weighted-average shares outstanding (in shares) | 46,615 | 47,616 | |
Dilutive effect of potential common stock equivalents — stock options and restricted stock units (in shares) | 394 | 290 | |
Diluted weighted-average shares outstanding (in shares) | 47,009 | 47,906 | |
Earnings per common share: | |||
Basic (in dollars per share) | $ 0.55 | $ 0.49 | |
Diluted (in dollars per share) | $ 0.54 | $ 0.48 |
Basis of Presentation Dividend
Basis of Presentation Dividend Declaration (Details) - $ / shares | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Dividend Declaration [Abstract] | |||
Cash dividends declared per common share (in dollars per share) | $ 0.21 | $ 0.18 | $ 0.63 |
Basis of Presentation Shares Re
Basis of Presentation Shares Repurchases (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | ||
Mar. 31, 2018 | Dec. 31, 2018 | Aug. 01, 2017 | |
Equity, Class of Treasury Stock [Line Items] | |||
Stock Repurchased During the Period | 182,171 | ||
Accelerated Share Repurchases, Settlement (Payment) or Receipt | $ 50 | ||
Stock Repurchase Program, Authorized Amount | $ 25 | $ 275 | |
Treasury Stock, Shares, Acquired | 437,500 | ||
Treasury Stock Acquired, Average Cost Per Share | $ 57.14 | ||
Forecast | |||
Equity, Class of Treasury Stock [Line Items] | |||
Stock Repurchase Program, Authorized Amount | $ 126.5 |
Basis of Presentation - Schedul
Basis of Presentation - Schedule of Business Acquisition (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | ||
Jan. 31, 2017 | Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Acquisitions | ||||
Maximum period for payment for adjustments to provisional fair value measurements | 1 year | |||
Goodwill | $ 138,026 | $ 135,113 | $ 137,140 | |
Liabilities | ||||
Gain on bargain purchase of a business | $ 8,400 | 0 | 8,388 | |
North America | ||||
Acquisitions | ||||
Goodwill | 95,677 | 95,574 | $ 95,755 | |
North America | CG Visions, Inc. [Member] | ||||
Acquisitions | ||||
Payments to acquire business | 20,800 | |||
Goodwill | 10,100 | |||
Business combination, intangible assets acquired | $ 10,300 | |||
Business combination, intangible assets acquired, weighted average useful life | 7 years | |||
Business combination, other current assets acquired | $ 500 | |||
Contingent consideration | 1,100 | |||
Assets | ||||
Other current assets | 500 | |||
Property, plant, equipment and noncurrent assets | 20,400 | |||
Europe Segment | Gbo Fastening Systems | ||||
Acquisitions | ||||
Payments to acquire business | 10,200 | |||
Business combination, cash and cash equivalents acquired | 3,956 | |||
Business combination, other current assets acquired | 760 | |||
Business combination, current liabilities assumed | 6,146 | |||
Assets | ||||
Cash and cash equivalents | 3,956 | |||
Accounts receivable | 4,914 | |||
Inventory | 13,591 | |||
Other current assets | 760 | |||
Property, plant, equipment and noncurrent assets | 3,929 | 16,500 | ||
Total assets | 27,150 | |||
Bargain Purchase Gain Adjustment | 2,100 | |||
Liabilities | ||||
Accounts payable | 4,500 | |||
Other current liabilities | 6,146 | |||
Total liabilities | 10,646 | |||
Total net assets | 16,504 | |||
Gain on bargain purchase of a business | 8,400 | $ (6,336) | $ (6,336) | |
Total purchase price | $ 10,168 |
Basis of Presentation - Recentl
Basis of Presentation - Recently Adopted Accounting Standards (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Cash paid on behalf of employees for shares withheld | $ 5,027 | $ 5,124 |
Accounting Standards Update 2016-02 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating lease commitment | $ 25,200 |
Basis of Presentation - Account
Basis of Presentation - Accounting for Stock-Based Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | Sep. 30, 2017 | |
Stock-based compensation activity, including both continuing and discontinued operations | ||||
Stock-based compensation expense recognized in operating expenses | $ 3,100 | $ 8,000 | ||
Proceeds to the Company from the exercise of stock-based compensation | 695 | $ 314 | ||
Tax effect from the exercise of stock-based compensation, including shortfall tax benefits (1) | 792 | |||
Fair value of financial instruments | ||||
Money Market Funds | 5,437 | $ 5,293 | $ 3,545 | |
Contingent Consideration | $ 1,401 | |||
Income Taxes | ||||
Effective tax rate (as a percent) | 22.20% | 24.90% | ||
Provision for income taxes | $ 7,253 | $ 7,680 |
Revenue from Contract with Cu36
Revenue from Contract with Customer (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2018 | Jan. 01, 2018 | Dec. 31, 2017 | Mar. 31, 2017 | |
Disaggregation of Revenue [Line Items] | ||||
Retained Earnings | $ 693,218 | $ 676,644 | $ 656,959 | |
ASC 606 | ||||
Disaggregation of Revenue [Line Items] | ||||
Retained Earnings | $ 800 | |||
ASC 606 | Wood construction products | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of net sales | 87.00% | |||
ASC 606 | Concrete construction products | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of net sales | 13.00% | |||
ASC 606 | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of net sales | 1.00% |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |
Jan. 31, 2017 | Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | ||||
Effective tax rate | 22.20% | 24.90% | ||
Provision for income taxes | $ 7,253 | $ 7,680 | ||
Change in enacted tax rate | 400 | |||
Net income | 25,429 | 23,121 | $ 69,496 | |
Gain on bargain purchase of a business | $ 8,400 | $ 0 | $ 8,388 |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) $ / shares in Units, $ in Millions | Apr. 24, 2018director$ / sharesshares | Feb. 15, 2018$ / sharesshares | Mar. 31, 2018USD ($) | Mar. 31, 2017USD ($) | Feb. 04, 2018$ / shares |
Stock-Based Compensation | |||||
Stock-based compensation expense | $ | $ 3.1 | $ 8 | |||
Unrecognized compensation cost and vesting period | |||||
Unrecognized compensation costs related to unvested share-based compensation arrangements | $ | $ 16.9 | ||||
Weighted-average period for recognition of unrecognized stock-based compensation expense | 2 years 5 months 30 days | ||||
Restricted Stock Units | |||||
Stock-Based Compensation | |||||
Awarded (in shares) | shares | 176,882 | ||||
Weighted average granted date fair value (in dollars per share) | $ / shares | $ 54.97 | ||||
Closing price per share (in dollars per share) | $ / shares | $ 57.16 | ||||
Vesting period | 3 years | ||||
Restricted Stock Units | Subsequent Event | |||||
Stock-Based Compensation | |||||
Awarded (in shares) | shares | 1,475 | ||||
Number of Non-Employee Directors | director | 8 | ||||
Employees | Restricted Stock Units | |||||
Stock-Based Compensation | |||||
Vesting period | 4 years | ||||
Non Employee Directors | Restricted Stock Units | Subsequent Event | |||||
Stock-Based Compensation | |||||
Awarded (in shares) | shares | 11,800 | ||||
Closing price per share (in dollars per share) | $ / shares | $ 55.34 |
Trade Accounts Receivable, Ne39
Trade Accounts Receivable, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2017 | |
Receivables [Abstract] | |||
Trade accounts receivable | $ 169,552 | $ 139,910 | $ 153,542 |
Allowance for doubtful accounts | (1,217) | (996) | (1,284) |
Allowance for sales discounts and returns | (1,189) | (2,956) | (3,752) |
Trade accounts receivable, net | 167,146 | $ 135,958 | $ 148,506 |
Adjustment in recognition | $ 1,100 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2017 |
Inventory Disclosure [Abstract] | |||
Raw materials | $ 87,363 | $ 91,022 | $ 90,545 |
In-process products | 28,406 | 26,849 | 26,010 |
Finished products | 140,783 | 135,125 | 139,716 |
Total inventories | $ 256,552 | $ 252,996 | $ 256,271 |
Property, Plant and Equipment41
Property, Plant and Equipment, Net (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2017 |
Property, Plant and Equipment | |||
Property, plant and equipment, gross | $ 570,276 | $ 550,922 | $ 479,264 |
Less accumulated depreciation and amortization | (309,198) | (299,907) | (279,607) |
Property, plant and equipment excluding capital projects in progress, net | 261,078 | 251,015 | 199,657 |
Capital projects in progress | 15,036 | 22,005 | 50,808 |
Property, plant and equipment, net | 276,114 | 273,020 | 250,465 |
Land | |||
Property, Plant and Equipment | |||
Property, plant and equipment, gross | 33,234 | 33,087 | 32,370 |
Buildings and site improvements | |||
Property, Plant and Equipment | |||
Property, plant and equipment, gross | 214,074 | 212,817 | 186,974 |
Leasehold improvements | |||
Property, Plant and Equipment | |||
Property, plant and equipment, gross | 4,767 | 4,684 | 5,515 |
Machinery, equipment, and software | |||
Property, Plant and Equipment | |||
Property, plant and equipment, gross | $ 318,201 | $ 300,334 | $ 254,405 |
Goodwill and Intangible Asset42
Goodwill and Intangible Assets, Net, Goodwill (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2017 |
Carrying amount of goodwill by reportable segment | |||
Goodwill | $ 138,026 | $ 137,140 | $ 135,113 |
North America | |||
Carrying amount of goodwill by reportable segment | |||
Goodwill | 95,677 | 95,755 | 95,574 |
Europe | |||
Carrying amount of goodwill by reportable segment | |||
Goodwill | 40,883 | 39,896 | 38,080 |
Asia/Pacific | |||
Carrying amount of goodwill by reportable segment | |||
Goodwill | $ 1,466 | $ 1,489 | $ 1,459 |
Goodwill and Intangible Asset43
Goodwill and Intangible Assets, Net, Intangible Assets, Net (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2017 |
Changes in gross carrying amount of finite-lived intangible assets | |||
Gross carrying amount | $ 54,827 | $ 54,537 | $ 61,972 |
Accumulated amortization | (26,525) | (25,211) | (30,259) |
Net carrying amount | 28,302 | 29,326 | 31,713 |
North America | |||
Changes in gross carrying amount of finite-lived intangible assets | |||
Gross carrying amount | 30,715 | 30,775 | 33,862 |
Accumulated amortization | (14,472) | (13,732) | (14,815) |
Net carrying amount | 16,243 | 17,043 | 19,047 |
Europe | |||
Changes in gross carrying amount of finite-lived intangible assets | |||
Gross carrying amount | 24,112 | 23,762 | 28,110 |
Accumulated amortization | (12,053) | (11,479) | (15,444) |
Net carrying amount | $ 12,059 | $ 12,283 | $ 12,666 |
Goodwill and Intangible Asset44
Goodwill and Intangible Assets, Net, Estimated Future Amortization (Details) $ in Thousands | Mar. 31, 2018USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Remaining nine months of 2018 | $ 4,048 |
2,018 | 5,311 |
2,019 | 5,281 |
2,020 | 4,802 |
2,021 | 2,878 |
2,022 | 2,074 |
Thereafter | 3,292 |
Total | $ 27,686 |
Goodwill and Intangible Asset45
Goodwill and Intangible Assets, Net, Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Sep. 30, 2017 | |
Indefinite-lived Intangible Assets [Line Items] | ||
Amortization of intangibles | $ 1,314 | $ 1,700 |
Trade Names | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | $ 600 |
Goodwill and Intangible Asset46
Goodwill and Intangible Assets, Net, Carrying Amount of Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Sep. 30, 2017 | |
Goodwill | ||
Balance at the beginning of the period | $ 137,140 | |
Foreign exchange | 886 | |
Balance at the end of the period | 138,026 | |
Intangible Assets | ||
Balance at the beginning of the period | 29,326 | |
Amortization | (1,314) | $ (1,700) |
Foreign exchange | 290 | |
Balance at the end of the period | $ 28,302 |
Investments (Details)
Investments (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | Dec. 23, 2016 | |
Equity Method Investment | ||||
Equity investment | $ 2,525 | $ 2,607 | $ 2,549 | $ 2,500 |
Loss in equity method investment, before tax | 24 | 28 | ||
Rudy Sketch | ||||
Equity Method Investment | ||||
Ownership percentage | 25.00% | |||
Equity investment | 2,500 | 2,500 | ||
Loss in equity method investment, before tax | $ 24 | $ 28 |
Debt (Details)
Debt (Details) | 3 Months Ended | |||
Mar. 31, 2018USD ($)lease | Dec. 31, 2017USD ($) | Sep. 30, 2017USD ($) | Mar. 31, 2017USD ($) | |
Debt | ||||
Number of capital lease obligations | lease | 2 | |||
Capital lease obligations, term | 4 years | |||
Capital lease obligations | $ 0 | $ 4,400,000 | $ 2,131,000 | |
Current portion of the outstanding liability | 1,100,000 | |||
Capital lease obligation - net of current portion | $ 2,400,000 | |||
Minimum | ||||
Debt | ||||
Capital lease obligations, Interest Rate, Stated Percentage | 2.89% | |||
Maximum | ||||
Debt | ||||
Capital lease obligations, Interest Rate, Stated Percentage | 3.50% | |||
Revolving Credit Facility | Base Rate | ||||
Debt | ||||
Credit facility, interest rate basis | base rate | |||
Line of Credit | ||||
Debt | ||||
Credit facility, total available credit | $ 304,200,000 | |||
Revolving Credit Facility | ||||
Debt | ||||
Credit facility, total available credit | 300,000,000 | |||
Credit facility, unused borrowing capacity | 4,200,000 | |||
Line of credit and notes payable | $ 0 | $ 0 | $ 0 | |
Revolving Credit Facility | Minimum | ||||
Debt | ||||
Facility fees on the available commitment of the facility (as a percent) | 0.15% | |||
Interest rate during period | 0.47% | |||
Revolving Credit Facility | Maximum | ||||
Debt | ||||
Facility fees on the available commitment of the facility (as a percent) | 0.30% | |||
Interest rate during period | 11.50% | |||
Revolving Credit Facility | LIBOR | ||||
Debt | ||||
LIBOR rate | 1.80% | |||
Credit facility, interest rate basis | LIBOR | |||
Revolving Credit Facility | LIBOR | Minimum | ||||
Debt | ||||
Credit facility, interest rate spread (as a percent) | 0.60% | |||
Revolving Credit Facility | LIBOR | Maximum | ||||
Debt | ||||
Credit facility, interest rate spread (as a percent) | 1.45% | |||
Revolving Credit Facility | Base Rate | Minimum | ||||
Debt | ||||
Credit facility, interest rate spread (as a percent) | 0.00% | |||
Revolving Credit Facility | Base Rate | Maximum | ||||
Debt | ||||
Credit facility, interest rate spread (as a percent) | 0.45% |
Segment Information (Details)
Segment Information (Details) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2018USD ($)segment | Mar. 31, 2017USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | |
Segment Reporting [Abstract] | ||||
Number of reportable segments | segment | 3 | |||
Segment Information | ||||
Net sales | $ 244,779 | $ 219,867 | ||
Income (Loss) from Operations | 32,796 | 22,630 | ||
Total Assets | 1,040,342 | 1,018,200 | $ 1,037,523 | |
Cash and cash equivalent | 137,413 | 167,059 | 168,514 | $ 226,537 |
Intersegment elimination | ||||
Segment Information | ||||
Net sales | 7,501 | 5,946 | ||
Administrative and all other | ||||
Segment Information | ||||
Income (Loss) from Operations | (1,676) | (2,107) | ||
Total Assets | (183,527) | (72,766) | (150,970) | |
Cash and cash equivalent | 53,400 | 92,100 | 80,200 | |
North America | ||||
Segment Information | ||||
Net sales | 206,212 | 183,772 | ||
Income (Loss) from Operations | 35,968 | 26,767 | ||
Total Assets | 982,149 | 877,408 | 953,033 | |
North America | Intersegment elimination | ||||
Segment Information | ||||
Net sales | 628 | 850 | ||
Europe | ||||
Segment Information | ||||
Net sales | 36,293 | 34,381 | ||
Income (Loss) from Operations | (1,647) | (1,835) | ||
Total Assets | 213,259 | 187,614 | 208,640 | |
Europe | Intersegment elimination | ||||
Segment Information | ||||
Net sales | 349 | 147 | ||
Asia/Pacific | ||||
Segment Information | ||||
Net sales | 2,274 | 1,714 | ||
Income (Loss) from Operations | 151 | (195) | ||
Total Assets | 28,461 | 25,944 | $ 26,820 | |
Asia/Pacific | Intersegment elimination | ||||
Segment Information | ||||
Net sales | $ 6,524 | $ 4,949 |
Segment Information (Details 2)
Segment Information (Details 2) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | |
Net sales and long-lived assets by geographical area | ||||
Cash and cash equivalents | $ 137,413 | $ 167,059 | $ 168,514 | $ 226,537 |
Net sales | 244,779 | 219,867 | ||
Wood construction products | ||||
Net sales and long-lived assets by geographical area | ||||
Net sales | 212,547 | 190,877 | ||
Concrete construction products | ||||
Net sales and long-lived assets by geographical area | ||||
Net sales | 32,156 | 28,817 | ||
Other | ||||
Net sales and long-lived assets by geographical area | ||||
Net sales | 76 | 173 | ||
Corporate, Non-Segment [Member] | ||||
Net sales and long-lived assets by geographical area | ||||
Cash and cash equivalents | $ 53,400 | $ 92,100 | $ 80,200 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - Nishimura v. Gentry Homes, Ltd $ in Millions | Nov. 20, 2017USD ($) |
Loss Contingencies [Line Items] | |
Settlement amount | $ 90 |
Repair costs | 54 |
Attorney fees | $ 36 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 3 Months Ended | 12 Months Ended | |
Apr. 30, 2018 | Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Subsequent Event [Line Items] | ||||
Cash dividends declared per common share (in dollars per share) | $ 0.21 | $ 0.18 | $ 0.63 | |
Subsequent Event | ||||
Subsequent Event [Line Items] | ||||
Cash dividends declared per common share (in dollars per share) | $ 0.22 | |||
Dividends | $ 10.2 | |||
Dividends, Percent Increase | 5.00% |