8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 5, 2020

PGT Innovations, Inc.

(Exact name of Registrant as Specified in Its Charter)

Delaware	001-37971	20-0634715
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)
1070 Technology Drive, North Venice, FL		34275
(Address of Principal Executive Offices)		(Zip Code)

Registrant’s Telephone Number, Including Area Code: (941) 480-1600

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

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

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, Par Value $0.01 Per Share	PGTI	New York Stock Exchange, Inc.

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company ☐

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

ITEM 2.02. Results of Operations and Financial Condition

On November 5, 2020, PGT Innovations, Inc. (the “Company”) issued a press release announcing its financial results for its third quarter ended October 3, 2020.

On the same date, the Company posted an earnings presentation on its investor relations website at http://ir.pgtinnovations.com. The earnings presentation is being made available in connection with the Company’s earnings conference call and audio webcast on November 5, 2020 at 10:30 a.m. E.T. The press release and the earnings presentation are furnished as Exhibits 99.1 and 99.2, respectively, to this Current Report on Form 8-K and are hereby incorporated herein by reference.

ITEM 7.01. Regulation FD Disclosure

The information set forth above under Item 2.02 is hereby incorporated herein by reference.

The information contained in this paragraph, as well as Exhibit 99.1 and Exhibit 99.2 referenced herein, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall they be deemed incorporated by reference in any filing under the Securities Act of 1933.

ITEM 9.01. Financial Statements and Exhibits

(d)	Exhibits
Exhibit No.		Description
99.1		Press release of PGT Innovations, Inc., dated November 5, 2020
99.2		Earnings presentation dated November 5, 2020
104		Cover Page Interactive Date File - the cover page XBRL tags are embedded within the Inline XBRL document

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SIGNATURES

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

PGT INNOVATIONS, INC.

By:  /s/ Sherri Baker                                                                  

       Name:  Sherri Baker

       Title:  Senior Vice President, and Chief Financial Officer

Dated:  November 5, 2020

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EXHIBIT INDEX

Exhibit No.	Description
99.1	Press release of PGT Innovations, Inc., dated November 5, 2020
99.2	Earnings presentation dated November 5, 2020
104	Cover Page Interactive Date File - the cover page XBRL tags are embedded within the Inline XBRL document

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EX-99..1

EXHIBIT 99.1

NEWS RELEASE

PGTI Reports 2020 Third Quarter Results

VENICE, Fla., November 5, 2020 – PGT Innovations, Inc. (NYSE: PGTI), a national leader in premium windows and doors, including impact-resistant products and products designed to unify indoor/outdoor living spaces, today announced financial results for its third quarter ended October 3, 2020.

Financial Highlights for Third Quarter 2020 compared to Third Quarter 2019

● Net sales increased 20 percent, to $238 million, including $27 million from our NewSouth acquisition

● Gross profit increased 24 percent, to $87 million

● Net income increased 15 percent, to $17 million

● Net income per diluted share increased 12 percent, to $0.29, and Adjusted net income per diluted share increased 19 percent, to $0.31

● Adjusted EBITDA increased 24 percent, to $43 million

“PGT Innovations’ third quarter sales reflect strong demand in our key markets, including 7 percent organic growth and $27 million of sales from NewSouth Window Solutions,” said Jeff Jackson, President and Chief Executive Officer. “Looking ahead to the fourth quarter of 2020 and into 2021, we expect sales growth based upon the strength of new orders, and our growing backlog. Our legacy Southeast and Western business units together saw order entries grow 26 percent over the prior-year quarter, while NewSouth increased orders by 48 percent. Execution of strategic selling and marketing initiatives has been a key driver of sales in addition to recovering market demand for our portfolio of products, aided by an active hurricane season.”

“Adjusted EBITDA increased 24 percent, to $43 million, while Adjusted EBITDA margins grew 50 basis points to 18 percent, driven by robust sales, improved operational efficiencies in our Western business and continued emphasis on controlling costs,” added Mr. Jackson.

“At the end of the quarter, total liquidity was $175 million, including cash on hand of $99 million and undrawn revolver capacity of $76 million, bringing our net debt-to-trailing-twelve-month Adjusted EBITDA ratio to 2.2 times. With strong recurring cash flow and overall liquidity, we also made voluntary prepayments of borrowings under the term loan totaling $10 million during the third quarter,” said Sherri Baker, Senior Vice President and Chief Financial Officer. “As we think about capital allocation, we continue

to prioritize internal investment in projects that we expect to drive margin growth or further improve our operational efficiency.”

“In the fourth quarter of 2020, we expect consolidated net sales, inclusive of NewSouth to be in the range of $200 million to $210 million, an increase of 14 to 20 percent compared to fourth quarter of 2019, reflecting current market strength and order entries booked through October,” concluded Baker.

Conference Call

PGT Innovations will host a conference call today at 10:30 a.m. The conference call will be available at the same time through the Investor Relations section of the PGT Innovations, Inc. website, http://ir.pgtinnovations.com/events.cfm.

To participate in the teleconference, kindly dial into the call about 10 minutes before the start time: 833-316-0547 (U.S. toll-free) and 412-317-5728 (International). A replay of the call will be available within approximately one hour after the scheduled end of the call on November 5, 2020, through approximately 12:30 p.m. on November 10, 2020. To access the replay, dial 877-344-7529 (U.S. Only toll-free), 855-669-9658 (Canada Only toll-free) and 412-317-0088 (International) and refer to pass code 10147976. Other international replay dial-in numbers can be obtained at:

https://services.choruscall.com/ccforms/replay.html

You may join the conference online by using the following link: https://services.choruscall.com/links/pgti201105KrgVqL7E.html

The webcast will also be available through the Investors section of the PGT Innovations, Inc. website:

http://ir.pgtinnovations.com/events.cfm.

About PGT Innovations, Inc.

PGT Innovations manufactures and supplies premium windows and doors. Its highly-engineered and technically-advanced products can withstand some of the toughest weather conditions on earth and unify indoor/outdoor living spaces. PGT Innovations creates value through deep customer relationships, understanding the unstated needs of the markets it serves and a drive to develop category-defining products. PGT Innovations is also the nation’s largest manufacturer of impact-resistant windows and doors, holds the leadership position in its primary markets, and is part of the S&P SmallCap 400 Index.

The PGT Innovations’ family of brands include CGI®, PGT® Custom Windows & Doors, WinDoor®, Western Window Systems®, CGI Commercial®, Eze-Breeze® and NewSouth Window Solutions®. The Company’s brands, in their respective markets, are a preferred choice of architects, builders, and homeowners throughout North America and the Caribbean. The Company’s high-quality products are available in custom and standard sizes with multiple dimensions that allow for greater design possibilities in residential, multi-family, and commercial projects. For additional information, visit www.pgtinnovations.com.

Forward-Looking Statements

Statements in this press release regarding our business that are not historical facts are “forward-looking statements” that involve risks and uncertainties which could cause actual results to differ materially from those contained in the forward-looking statements. Such forward-looking statements generally can be identified by the use of forward-looking terminology, such as “believe,” “expect,” “intend,” “positioned,” “assumptions” and similar terminology. These risks and uncertainties include factors such as:

• the impact of the COVID-19 pandemic and related measures taken by governmental or regulatory authorities to combat the pandemic, including the impact of the pandemic and these measures on the economies and demand for our products in the states where we sell them, and on our customers, suppliers, labor force, business, operations and financial performance;

• unpredictable weather and macroeconomic factors that may negatively impact the repair and remodel and new construction markets and the construction industry generally, especially in the state of Florida and the western United States, where the substantial portion of our sales are currently generated, and in the U.S. generally;

• changes in raw material prices, especially for aluminum, glass and vinyl, including, price increases due to the implementation of tariffs and other trade-related restrictions;

• our dependence on a limited number of suppliers for certain of our key materials;

• our dependence on our impact-resistant product lines and contemporary indoor/outdoor window and door systems, and on consumer preferences for those types and styles of products;

• the effects of increased expenses or unanticipated liabilities incurred as a result of, or due to activities related to, our acquisitions of NewSouth and Western Window Systems;

• our level of indebtedness, which increased in connection with our acquisition of Western Window Systems, and increased further in connection with our acquisition of NewSouth;

• increases in bad debt owed to us by our customers in the event of a downturn in the home repair and remodel or new home construction channels in our core markets and our inability to collect such debt;

• the risks that the anticipated cost savings, synergies, revenue enhancement strategies and other benefits expected from our acquisitions of NewSouth and Western Window Systems may not be fully realized or may take longer to realize than expected or that our actual integration costs may exceed our estimates;

• increases in transportation costs, including increases in fuel prices;

• our dependence on our limited number of geographically concentrated manufacturing facilities;

• sales fluctuations to and changes in our relationships with key customers;

• federal, state and local laws and regulations, including unfavorable changes in local building codes and environmental and energy code regulations;

• risks associated with our information technology systems, including cybersecurity-related risks, such as unauthorized intrusions into our systems by “hackers” and theft of data and information from our systems, and the risks that our information technology systems do not function as intended or experience temporary or long-term failures to perform as intended;

•

product liability and warranty claims brought against us;

• in addition to the acquisitions of NewSouth and Western Window Systems, our ability to successfully integrate businesses we may acquire in the future, or that any business we acquire may not perform as we expected at the time we acquired it; and

• the other risks and uncertainties discussed under “Risk Factors” in Part II, Item 1A of our Quarterly Report on Form 10-Q for the quarter ended October 3, 2020, and “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 28, 2019 and our other SEC filings.

Statements in this press release that are forward-looking statements include, without limitation, our expectations regarding: (1) demand for our products in future periods, as the economies in our markets continue to reopen, and thereafter; (2) our ability to capture sales and sales growth; (3) the amount of operating expense savings and other possible benefits arising from the closure of our Orlando, Florida manufacturing facility and the consolidation of its operations into our Venice and Tampa, Florida facilities, and the timing of those benefits; (4) our ability to lower labor and other costs and improve operating efficiencies; (5) the strength of our balance sheet, our liquidity, our capital allocation priorities, and ability to preserve cash and liquidity generally; (6) our net sales and EBITDA margins for the third quarter of 2020; (7) our growth trajectory and market expansion; and (8) our inability to forecast and provide guidance regarding our financial performance for the 2020 fiscal year. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Except as required by law, the Company undertakes no obligation to update these forward-looking statements to reflect subsequent events or circumstances from the date of this press release.

Use of Non-GAAP Financial Measures

This press release and the financial schedules include financial measures and terms not calculated in accordance with U.S. generally accepted accounting principles (GAAP). We believe that presentation of non-GAAP measures such as Adjusted net income, Adjusted net income per share, and Adjusted EBITDA provides investors and analysts with an alternative method for assessing our operating results in a manner that enables investors and analysts to more thoroughly evaluate our current performance compared to past performance. We also believe these non-GAAP measures provide investors with a better baseline for assessing our future earnings potential. The non-GAAP measures included in this press release are provided to give investors access to types of measures that we use in analyzing our results.

Adjusted net income consists of GAAP net income adjusted for the items included in the accompanying reconciliation. Adjusted net income per share consists of GAAP net income per share adjusted for the items included in the accompanying reconciliation. We believe these measures enable investors and analysts to more thoroughly evaluate our current performance as compared to past performance and provide a better baseline for assessing the Company's future earnings potential. However, these measures do not provide a complete picture of our operations.

Adjusted EBITDA consists of net income, adjusted for the items included in the accompanying reconciliation. We believe that Adjusted EBITDA provides useful information to investors and analysts about the Company's performance because they eliminate the effects of period-to-period changes in taxes, costs associated with capital investments and interest expense. Adjusted EBITDA does not give effect to the cash the Company must use to service its debt or pay its income taxes and thus does not reflect the actual funds generated from operations or available for capital investments.

Our calculations of Adjusted net income and Adjusted net income per share, and Adjusted EBITDA are not necessarily comparable to calculations performed by other companies and reported as similarly titled measures. These non-GAAP measures should be considered in addition to results prepared in accordance with GAAP but should not be considered a substitute for or superior to GAAP measures. Schedules that reconcile Adjusted net income, Adjusted net income per share, and Adjusted EBITDA to GAAP net income are included in the financial schedules accompanying this release.

Adjusted EBITDA as used in the calculation of the net debt-to-Adjusted EBITDA ratio, consists of our Adjusted EBITDA as described above, but for the trailing twelve-month period, adjusted pursuant to the covenants contained in the 2016 Credit Agreement due 2022.

SOURCE: PGT Innovations, Inc.

PGT Innovations Contacts:

Investor Relations:

Sherri Baker, 941-480-1600

Senior Vice President and CFO

SBaker@PGTInnovations.com

Media Relations:

Stephanie Cz, 941-480-1600

Corporate Communications Manager

PGT INNOVATIONS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited - in thousands, except per share amounts)
	Three Months Ended				Nine Months Ended
	Oct. 3,		Sept. 28,		Oct. 3,		Sept. 28,
	2020		2019		2020		2019
Net sales	$	238,033	$	197,823	$	661,020	$	570,130
Cost of sales		151,097		127,828		418,494		365,925
Gross profit		86,936		69,995		242,526		204,205
Selling, general and administrative expenses		56,659		44,564		164,848		132,604
Impairment of trade name		—		—		8,000		-
Restructuring costs and charges		321		—		4,227		-
Income from operations		29,956		25,431		65,451		71,601
Interest expense, net		6,954		6,452		20,979		19,922
Income before income taxes		23,002		18,979		44,472		51,679
Income tax expense		5,680		3,873		9,351		11,271
Net income	$	17,322	$	15,106	$	35,121	$	40,408
Basic net income per common share	$	0.29	$	0.26	$	0.60	$	0.69
Diluted net income per common share	$	0.29	$	0.26	$	0.59	$	0.68
Weighted average common shares outstanding:
Basic		58,963		58,433		58,858		58,320
Diluted		59,442		59,142		59,291		59,192

PGT INNOVATIONS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited - in thousands)
	October 3,		December 28,
	2020		2019
ASSETS
Current assets:
Cash and cash equivalents	$	99,344	$	97,243
Accounts receivable, net		99,062		68,091
Inventories		54,707		43,851
Contract assets, net		24,050		10,547
Prepaid expenses and other current assets		20,613		13,878
Total current assets		297,776		233,610
Property, plant and equipment, net		132,710		128,199
Operating lease right-of-use asset, net		38,912		26,390
Intangible assets, net		261,208		255,962
Goodwill		328,425		277,600
Other assets, net		1,103		972
Total assets	$	1,060,134	$	922,733
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses	$	96,422	$	51,394
Current portion of operating lease liability		6,396		4,703
Total current liabilities		102,818		56,097
Long-term debt, less current portion		411,817		368,971
Operating lease liability, less current portion		35,513		24,040
Deferred income taxes, net		26,099		27,945
Other liabilities		12,533		14,132
Total liabilities		588,780		491,185
Total shareholders' equity		471,354		431,548
Total liabilities and shareholders' equity	$	1,060,134	$	922,733

PGT INNOVATIONS, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO THEIR
MOST DIRECTLY COMPARABLE GAAP EQUIVALENTS
(unaudited - in thousands, except per share amounts and percentages)
	Three Months Ended						Nine Months Ended
	Oct. 3,			Sept. 28,			Oct. 3,			Sept. 28,
	2020			2019			2020			2019
Reconciliation to Adjusted Net Income and
Adjusted Net Income per share (1):
Net income	$	17,322		$	15,106		$	35,121		$	40,408
Reconciling items:
Impairment of trade name (2)		-			-			8,000			-
Restructuring costs and charges (3)		321			-			4,227			-
Product line transition costs (4)		-			-			382			1,133
Acquisition-related costs (5)		-			-			922			2,359
Pandemic-related costs (6)		771			-			2,356			-
Tax effect of reconciling items		(273	)		-			(3,973	)		(897	)
Adjusted net income	$	18,141		$	15,106		$	47,035		$	43,003
Weighted-average diluted shares		59,442			59,142			59,291			59,192
Adjusted net income per share - diluted	$	0.31		$	0.26		$	0.79		$	0.73
Reconciliation to Adjusted EBITDA (1):
Depreciation and amortization expense	$	10,810		$	8,640		$	31,685		$	25,813
Interest expense, net		6,954			6,452			20,979			19,922
Income tax expense		5,680			3,873			9,351			11,271
Reversal of tax effect of reconciling items for
Adjusted net income above		273			-			3,973			897
Stock-based compensation expense		1,451			971			4,369			3,247
Adjusted EBITDA	$	43,309		$	35,042		$	117,392		$	104,153
Adjusted EBITDA as percentage of net sales		18.2	%		17.7	%		17.8	%		18.3	%
Net debt-to-Adjusted EBITDA ratio (7)								2.2	x

(1) The Company's non-GAAP financial measures were explained in its Form 8-K filed November 5, 2020.

(2) Represents impairment charge relating to our Western Window Systems trade name, for the nine months ended October 3, 2020.

(3) Represents restructuring costs and charges relating to our previously announced Florida facilities consolidation, which includes closure of our Orlando, Florida manufacturing facility, and relocation of the manufacturing of our Eze-Breeze products to our N. Venice, Florida manufacturing facility, and of our WinDoor products to our Tampa, Florida manufacturing facility, totaling $4.2 million, as classified within the line item on the condensed consolidated statement of operations for the nine months ended October 3, 2020 described as restructuring costs and charges, including $321 thousand incurred and paid in the three months ended October 3, 2020. Of the $4.2 million of restructuring costs and charges, $1.9 million represents relocations and write-offs of property, plant and equipment, including the impairment of the right-of-use asset of the lease of the Orlando, Florida facility, $1.2 million represents charges relating to inventory we do not expect to use due to product rationalization, which we chose to dispose of, and $1.1 million represents personnel-related costs. Substantially all of the personnel-related costs had been paid in cash during our 2020 second quarter.

(4) Represents costs relating to product line transitions, classified within cost of sales for the nine months ended October 3, 2020, and September 28, 2019.

(5) In 2020, represents costs relating to the acquisition of NewSouth Window Solutions, and in 2019, relating to the acquisition of Western Window Systems, classified within selling, general and administrative expenses for the nine months ended October 3, 2020 and September 28, 2019.

(6)  Represents incremental costs incurred relating to the coronavirus pandemic, including cleaning and sanitization costs for the protection of the health of our employees and safety of our facilities, classified within selling, general and administrative expenses for the three and nine months ended October 3, 2020.

(7) Calculated using an Adjusted EBITDA amount pursuant to the covenants included in our 2016 Credit Agreement due 2022 which includes the EBITDA of our NewSouth acquisition on a proforma trailing twelve-month basis.

EX-99..2

Q3 2020 Financial results November 5, 2020 EXHIBIT 99.2

FORWARD LOOKING STATEMENTS Statements in this presentation regarding our business that are not historical facts are “forward-looking statements” that involve risks and uncertainties which could cause actual results to differ materially from those contained in the forward-looking statements. Such forward-looking statements generally can be identified by the use of forward-looking terminology, such as “expected,” “excited,” “guidance,” “believe,” “expect,” “may,” “outlook,” “forecast,” “intend,” “could,” “project,” “estimate,” “anticipate,” “should,” “plan” and similar terminology. These risks and uncertainties include factors such as: the impact of the global COVID-19 pandemic (“Pandemic”) and related measures taken by governmental or regulatory authorities to combat the Pandemic, including the impact of the Pandemic and these measures on the economies and demand for our products in the states where we sell them, and on our customers, suppliers, labor force, business, operations and financial performance; unpredictable weather and macroeconomic factors that may negatively impact the repair and remodel and new construction markets and the construction industry generally, especially in the state of Florida and the western United States, where the substantial portion of our sales are currently generated, and in the U.S. generally; changes in raw material prices, especially for aluminum, glass and vinyl, including, price increases due to the implementation of tariffs and other trade-related restrictions; our dependence on a limited number of suppliers for certain of our key materials; our dependence on our impact-resistant product lines and contemporary indoor/outdoor window and door systems, and on consumer preferences for those types and styles of products; the effects of increased expenses or unanticipated liabilities incurred as a result of, or due to activities related to, our acquisitions of NewSouth and Western Window Systems; our level of indebtedness, which increased in connection with our acquisition of Western Window Systems, and increased further in connection with our acquisition of NewSouth; increases in bad debt owed to us by our customers in the event of a downturn in the home repair and remodeling or new home construction channels in our core markets and our inability to collect such debt; the risks that the anticipated cost savings, synergies, revenue enhancement strategies and other benefits expected from our acquisitions of NewSouth and Western Window Systems may not be fully realized or may take longer to realize than expected or that our actual integration costs may exceed our estimates; increases in transportation costs, including due to increases in fuel prices; our dependence on our limited number of geographically concentrated manufacturing facilities; sales fluctuations to and changes in our relationships with key customers; federal, state and local laws and regulations, including unfavorable changes in local building codes and environmental and energy code regulations; risks associated with our information technology systems, including cybersecurity-related risks, such as unauthorized intrusions into our systems by “hackers” and theft of data and information from our systems, and the risks that our information technology systems do not function as intended or experience temporary or long-term failures to perform as intended; product liability and warranty claims brought against us; in addition to the acquisitions of NewSouth and Western Window Systems, our ability to successfully integrate businesses we may acquire in the future, or that any business we acquire may not perform as we expected when we acquired it; and the other risks and uncertainties discussed under “Risk Factors” in Part II, Item 1A of our Quarterly Report on Form 10-Q for the quarter ended October 3, 2020, and “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 28, 2019 and our other SEC filings. Forward looking statements in this presentation include our expectations regarding: (i) driving brand recognition; (ii) attracting and retaining talented, dedicated leaders; (iii) investing in our business and scaling operations to capture increasing long-term demand; (iv) strategically allocating free cash flow in support of profitable growth; (v) building team and infrastructure to target sales in key segments; (vi) expanding presence in important growing channels; (vii) innovating products by collaborating with customers and investing in research and development; (viii) using brand strength along with digital and data to drive growth; (ix) expected margin growth from investment in continuous improvement; (x) strategic selling initiatives and marketing enhancements driving future sales; (xi) our ability to maintain a strong balance sheet and conservative capital structure, with a target leverage ratio of between 2 and 3 times; (xii) using strategic acquisitions to align with growth priorities expected to grow shareholder value over the long-term, expand into new regions, channels or products, and add technologies, enhanced manufacturing or supply chain capabilities; and (xiii) reasons to invest in PGT Innovations, including our national leadership in growing premium impact-resistant and indoor/outdoor window and door industry, expectation that we will continue to invest in talent and R&D, expectation that we will continue to focus on operational efficiencies to drive margin expansion, that execution of our strategy will create long-term customer and shareholder value, and our position of having diversified products which we expect to capture profitable growth in the new construction and repair and remodel channels. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this presentation. Except as required by law, the Company undertakes no obligation to update these forward-looking statements to reflect subsequent events or circumstances from the date of this presentation.

Use of Non-GAAP Financial Measures This presentation and the financial schedules include financial measures and terms not calculated in accordance with U.S. generally accepted accounting principles (GAAP). We believe that presentation of non-GAAP measures such as Adjusted net income, Adjusted net income per share, and Adjusted EBITDA provides investors and analysts with an alternative method for assessing our operating results in a manner that enables investors and analysts to more thoroughly evaluate our current performance compared to past performance. We also believe these non-GAAP measures provide investors with a better baseline for assessing our future earnings potential. The non-GAAP measures included in this release are provided to give investors access to types of measures that we use in analyzing our results. Adjusted net income consists of GAAP net income Adjusted for the items included in the accompanying reconciliation. Adjusted net income per share consists of GAAP net income per share Adjusted for the items included in the accompanying reconciliation. We believe these measures enable investors and analysts to more thoroughly evaluate our current performance as compared to the past performance and provide a better baseline for assessing the Company's future earnings potential. However, these measures do not provide a complete picture of our operations. Adjusted EBITDA consists of net income, Adjusted for the items included in the accompanying reconciliation. We believe that Adjusted EBITDA provides useful information to investors and analysts about the Company's performance because they eliminate the effects of period-to-period changes in taxes, costs associated with capital investments and interest expense. Adjusted EBITDA does not give effect to the cash the Company must use to service its debt or pay its income taxes and thus does not reflect the actual funds generated from operations or available for capital investments. Our calculations of Adjusted net income and Adjusted net income per share, and Adjusted EBITDA are not necessarily comparable to calculations performed by other companies and reported as similarly titled measures. These non-GAAP measures should be considered in addition to results prepared in accordance with GAAP but should not be considered a substitute for or superior to GAAP measures. Schedules that reconcile Adjusted net income, Adjusted net income per share, and Adjusted EBITDA to GAAP net income are included in the financial schedules accompanying this release. Adjusted EBITDA as used in the calculation of the net debt-to-Adjusted EBITDA ratio, consists of our Adjusted EBITDA as described above, but for the trailing twelve-month period, adjusted pursuant to the covenants contained in our credit agreements.

Strategic Framework for Profitable Growth 01. Drive brand recognition, loyalty and growth with customer-centric innovation 02. Attract and retain talented, dedicated leaders to drive our business 03. Invest in our business and scale our operations to capture increasing long-term demand 04. Strategically allocate free cash flow primarily to support profitable growth

Third Quarter key Messages Q3 2020 vs. Q3 2019 Net Sales $238.0M 20% ↑ Gross Profit $86.9M 24% ↑ Adj. EBITDA1 Margin 18.2% 0.5% ↑ 1. Refer to reconciliation to GAAP. Highlights Strong execution of selling and marketing initiatives in core Florida market Sales contribution of $27M from NewSouth exceeding expectations Margin improvement reflects impact of improved performance at Western, driven by significant operational improvements in direct labor and distribution

Market Performance: LEGACY BUSINESS (SEBU1 & WEBU2) Commentary Q3’20 total legacy orders up 26% YoY; order entry up 33% in legacy SEBU and down 2% in WEBU Q3’20 total legacy backlog up 111% YoY driven by 137% increase in legacy SEBU 9% increase in WEBU NewSouth retail orders increased 48% YoY in Q3’20; retail backlog of $45M at end of Q3’20 up over 150% YoY Legacy Backlog3 ($M) 1. Southeastern Business Unit, excluding NewSouth; 2. Western Business Unit; 3. Excludes NewSouth. 111% GROWTH YoY Order Growth, by Month SEBU1 YoY Order Growth, by Month WEBU2

Strategic Marketing driving lead generation and Sales Building Team and Infrastructure to Target Sales in Key Segments Legacy R&R dealers seeing strong lead conversion to order Multi-family / mixed use building pipeline of demand for commercial projects in the addressable Florida market Production Builders: Exclusive agreements with annual recurring revenues, adding new communities Expanding Presence in Important Growing Channels Big Box: Increasing number of stores carrying our products and the availability of special-order options Coastal States: Expanding legacy impact products through existing dealer channels, benefitting from awareness generated by several years of hurricanes spanning large geographical area Direct-to-consumer: New channel in 2020 with NewSouth Window Solutions – planning to add new retail showrooms over next 12 months; Western Window Systems launched retail store Skyewalls expansion in 2021 Innovating Products by Collaborating with Customers and Investing in R&D Changing builder preferences: To accommodate demand for a lower price-point, introduced CGI Sparta (value aluminum) and WWS 3700 Series (value vinyl) as large builders began to de-spec iLab innovation – Launched in 2019 as an incubator to distribute future innovative products through select dealers before producing on a larger scale; strong new product adoption Using Brand Strength along with Digital and Data to Drive Growth Data Driven Approach: Generating leads and using digital marketing to capture larger at-home audience during 2020; significant growth at NewSouth and legacy Florida business from execution of strategic selling and marketing initiatives

Q3 2020 RESULTS Q3 2020 vs. Q3 2019 Net Sales $238M 20% ↑ Gross Margin 36.5% 1.1% ↑ Adjusted EBITDA1 $43.3M 23.7% ↑ Adj. Diluted EPS1 $0.31 19.2% ↑ Highlights NewSouth sales contribution of $27M Organic sales increased 7% YoY: up 9% in legacy SEBU and down 5% in WEBU Organic growth of 13% YoY in Repair & Remodel and flat YoY in New Construction Margin improvement reflects impact of improved performance at Western; expecting favorable margins vs prior year to continue in Q4 Focusing on increasing manufacturing capacities 1. Refer to reconciliation to GAAP.

Balance sheet and Liquidity Update NET LEVERAGE Total Debt Outstanding $419.0M Less: Cash $99.3M Net Debt $319.7M TTM Adj EBITDA1 $145.0M Net Debt to Adj EBITDA1 2.2x LIQUIDITY PROFILE Cash $99.3M Unused Credit Capacity $76.0M Total Available Liquidity $175.3M Senior Notes (Aug 2026) $365.0M Revolving Credit (Oct 2022) $54.0M Total Debt Outstanding $419.0M Debt Maturity Schedule ($M) End of Q3 2020 Term Loan Senior Notes COMMENTARY Strong and flexible balance sheet $10M in total term loan paydowns made in Q3 2020 Net debt to TTM Adjusted EBITDA1 ratio of 2.2x pro forma for NewSouth acquisition. 1. Refer to reconciliation to GAAP.

Strong balance sheet 1. Net debt is total consolidated funded indebtedness as of the end of the respective quarter, calculated on an all-cash netted basis. Adjusted EBITDA is calculated in accordance with our credit agreement. Refer to reconciliation to GAAP. 2. Leverage ratio defined as net debt divided by trailing-twelve-month Adjusted EBITDA; refer to reconciliation to GAAP. Highlights Ended Q3 2020 with net debt of $320 million, down from $331 million in Q2 2020 Net debt to trailing-twelve month Adjusted EBITDA of 2.2 times, pro forma for NewSouth acquisition $10M in total debt paydowns in Q3 2020 given strong financial performance and growing backlog Net Debt1 and Leverage Ratio2 ACQUIRED ACQUIRED ACQUIRED ACQUIRED

Long-Term Capital Allocation priorities INTERNAL INVESTMENT Investment in continuous improvement expected to drive margin growth Strategic selling initiatives and marketing enhancements driving sales in 2020 and beyond 01 DEBT REDUCTION Expect to maintain a strong balance sheet and conservative capital structure Long-term target Leverage Ratio of 2x – 3x 02 STRATEGIC ACQUISITIONS Aligned with growth priorities and expected to grow shareholder value over the long-term Expansion into new regions, channels or products Addition of technologies, enhanced manufacturing or supply chain capabilities 03

Why Invest in PGT Innovations 01 National leader in growing premium impact-resistant and indoor / outdoor window and door category 02 Expect to continue investing in talent and R&D to remain an industry leader in innovation and product development 03 Continued focus on operational efficiencies expected to drive additional margin expansion 04 Execution of our strategy expected to create long-term customer and shareholder value 05 Well positioned with diversified product portfolio to capture profitable growth in new construction and R&R channels

Q&A

Appendix Reconciliation to Adjusted Net Income, Adjusted Net Income per Share-diluted, Adjusted EBITDA, and Adjusted EBITDA per our bank covenants

Reconciliation of GAAP to NON-gaap MEASURES (unaudited - in thousands, except per share amounts) THREE MONTHS ENDED October 3, 2020 AND September 28, 2019 THREE MONTHS ENDED 10/3/2020 9/28/2019                                                          

Reconciliation of GAAP to NON-gaap MEASURES unaudited - in thousands, except per share amounts) THREE MONTHS ENDED October 3, 2020 AND September 28, 2019

Reconciliation of GAAP to NON-gaap MEASURES (in MILLIONS)

Reconciliation of GAAP to NON-gaap MEASURES Represents the total of the adjustments consistent with previously published and publicly available earnings releases as issued by the Company relating to the period for which the total adjustments is presented. Beginning in 2018, the Company updated its reporting of Adjusted EBITDA for its publicly issued earnings to exclude non-cash stock-based compensation expense. As such, the total of the adjustments per previously published earnings as presented herein will not agree to the total adjustments as previously issued for periods prior to 2018, as they have been revised as a result of this change in presentation. Calculated in accordance with covenants pursuant to the Company’s then existing credit agreements, which includes adjustments for expected cost savings, operating expense reductions and synergies related to acquisitions, as well as the earnings of acquired entities on a pro forma basis for any pre-acquisition period within the trailing twelve-months relating to the period of the calculation.

XML

Document And Entity Information	Nov. 05, 2020
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Nov. 05, 2020
Entity Registrant Name	PGT Innovations, Inc.
Entity Central Index Key	0001354327
Entity Emerging Growth Company	false
Entity File Number	001-37971
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	20-0634715
Entity Address, Address Line One	1070 Technology Drive
Entity Address, City or Town	North Venice
Entity Address, State or Province	FL
Entity Address, Postal Zip Code	34275
City Area Code	941
Local Phone Number	480-1600
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Security Exchange Name	NYSE
Title of each class	Common Stock, Par Value $0.01 Per Share
Trading Symbol(s)	PGTI