10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2016

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Transition Period From To

Commission File Number: 001-36307

Installed Building Products, Inc.

(Exact name of registrant as specified in its charter)

Delaware	45-3707650
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
495 South High Street, Suite 50 Columbus, Ohio	43215
(Address of principal executive offices)	(Zip Code)

(614) 221-3399

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  ☒     No  ☐

Indicate by a check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See definition of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	☐		Accelerated filer	☒
Non-accelerated filer	☐	(Do not check if a smaller reporting company)	Smaller reporting company	☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b−2 of the Exchange Act).    Yes  ☐    No  ☒

On October 31, 2016, the registrant had 31,485,525 shares of common stock, par value $0.01 per share, outstanding.

Table of Contents

PART I – FINANCIAL INFORMATION	1
Item 1.  Financial Statements	1
Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations	19
Item 3. Quantitative and Qualitative Disclosures About Market Risk	26
Item 4. Controls and Procedures	26
PART II – OTHER INFORMATION	27
Item 1. Legal Proceedings	27
Item 1A.  Risk Factors	27
Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds	28
Item 3.  Defaults Upon Senior Securities	28
Item 4.  Mine Safety Disclosures	28
Item 5.  Other Information	29
Item 6.  Exhibits	29
SIGNATURES	29

i

PART I – FINANCIAL INFORMATION

Item 1.  Financial Statements

INSTALLED BUILDING PRODUCTS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(in thousands, except share and per share amounts)

	September 30,			December 31,
	2016			2015
ASSETS
Current assets
Cash	$	19,050		$	6,818
Accounts receivable (less allowance for doubtful accounts of $3,310 and $2,486 at    September 30, 2016 and December 31, 2015, respectively)		125,058			103,198
Inventories		34,083			29,337
Other current assets		6,320			10,879
Total current assets		184,511			150,232
Property and equipment, net		65,930			57,592
Non-current assets
Goodwill		102,518			90,512
Intangibles, net		80,423			67,218
Other non-current assets		8,438			8,018
Total non-current assets		191,379			165,748
Total assets	$	441,820		$	373,572
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Current maturities of long-term debt	$	15,064		$	10,021
Current maturities of capital lease obligations		7,333			8,411
Accounts payable		60,007			50,867
Accrued compensation		17,464			14,488
Other current liabilities		20,206			13,635
Total current liabilities		120,074			97,422
Long-term debt		133,011			113,214
Capital lease obligations, less current maturities		9,215			12,031
Deferred income taxes		15,241			14,582
Other long-term liabilities		21,746			21,840
Total liabilities		299,287			259,089
Commitments and contingencies (Note 9)
Stockholders' equity
Preferred Stock; $0.01 par value: 5,000,000 authorized and 0 shares issued and    outstanding at September 30, 2016 and December 31, 2015, respectively		—			—
Common Stock; $0.01 par value: 100,000,000 authorized, 32,135,176 and    31,982,888 issued and 31,485,525 and 31,366,328 shares outstanding at    September 30, 2016 and December 31, 2015, respectively		321			320
Additional paid in capital		158,218			156,688
Accumulated deficit		(3,787	)		(31,142	)
Treasury Stock; at cost: 649,651 and 616,560 shares at September 30, 2016 and    December 31, 2015, respectively		(12,219	)		(11,383	)
Total stockholders' equity		142,533			114,483
Total liabilities and stockholders' equity	$	441,820		$	373,572

See accompanying notes to condensed consolidated financial statements

1

INSTALLED BUILDING PRODUCTS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

(in thousands, except share and per share amounts)

	Three months ended September 30,				Nine months ended September 30,
	2016		2015		2016		2015
Net revenue	$	225,392	$	181,579	$	629,003	$	471,220
Cost of sales		158,132		128,162		444,909		337,395
Gross profit		67,260		53,417		184,094		133,825
Operating expenses
Selling		13,028		10,282		36,239		27,275
Administrative		31,504		25,841		92,677		72,606
Amortization		2,889		1,817		8,178		4,091
Operating income		19,839		15,477		47,000		29,853
Other expense
Interest expense		1,544		989		4,605		2,654
Other		23		138		248		357
		1,567		1,127		4,853		3,011
Income before income taxes		18,272		14,350		42,147		26,842
Income tax provision		6,723		4,869		14,792		9,612
Net income attributable to common stockholders	$	11,549	$	9,481	$	27,355	$	17,230
Basic net income per share attributable to common stockholders	$	0.37	$	0.30	$	0.87	$	0.55
Diluted net income per share attributable to common stockholders	$	0.37	$	0.30	$	0.87	$	0.55
Weighted average shares outstanding:
Basic		31,323,600		31,237,275		31,294,596		31,318,682
Diluted		31,377,790		31,288,609		31,351,991		31,343,230

See accompanying notes to condensed consolidated financial statements

2

INSTALLED BUILDING PRODUCTS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (UNAUDITED)

(in thousands, except share amounts)

	Common Stock				Additional Paid In			Accumulated			Treasury Shares						Stockholders'
	Shares		Amount		Capital			Deficit			Shares			Amount			Equity
BALANCE - January 1, 2015		31,839,087	$	319	$	154,497		$	(57,659	)		(300,000	)	$	(5,283	)	$	91,874
Net income									17,230									17,230
Issuance of common stock awards to    employees		130,613		1		(1	)											—
Surrender of common stock awards by    employees												(1,560	)		—			—
Share-based compensation expense						1,232												1,232
Share-based compensation issued to Directors		13,188				300												300
Tax benefit from stock plans						76												76
Common stock repurchase												(315,000	)		(6,100	)		(6,100	)
BALANCE - September 30, 2015		31,982,888	$	320	$	156,104		$	(40,429	)		(616,560	)	$	(11,383	)	$	104,612
	Common Stock				Additional Paid In			Accumulated			Treasury Shares						Stockholders'
	Shares		Amount		Capital			Deficit			Shares			Amount			Equity
BALANCE - January 1, 2016		31,982,888	$	320	$	156,688		$	(31,142	)		(616,560	)	$	(11,383	)	$	114,483
Net income									27,355									27,355
Issuance of common stock awards to    employees		143,528		1		(1	)											—
Surrender of common stock awards by    employees												(33,091	)		(836	)		(836	)
Share-based compensation expense						1,231												1,231
Share-based compensation issued to Directors		8,760				300												300
BALANCE - September 30, 2016		32,135,176	$	321	$	158,218		$	(3,787	)		(649,651	)	$	(12,219	)	$	142,533

See accompanying notes to condensed consolidated financial statements

3

INSTALLED BUILDING PRODUCTS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(in thousands)

	For the nine months ended September 30,
	2016			2015
Cash flows from operating activities
Net income	$	27,355		$	17,230
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization of property and equipment		17,240			11,872
Amortization of intangibles		8,178			4,091
Amortization of deferred financing costs and debt discount		282			199
Provision for doubtful accounts		1,960			1,551
Write-off of debt issuance costs		286			-
Gain on sale of property and equipment		(218	)		(247	)
Noncash stock compensation		1,531			1,532
Deferred income taxes		708			107
Changes in assets and liabilities, excluding effects of acquisitions
Accounts receivable		(17,878	)		(16,405	)
Inventories		(3,158	)		(2,960	)
Other assets		4,727			5,265
Accounts payable		3,879			5,777
Income taxes payable		3,652			1,918
Other liabilities		6,033			(819	)
Net cash provided by operating activities		54,577			29,111
Cash flows from investing activities
Purchases of property and equipment		(19,169	)		(19,959	)
Acquisitions of businesses, net of cash acquired of $0 and $924, respectively		(36,427	)		(71,040	)
Proceeds from sale of property and equipment		523			448
Other		—			(420	)
Net cash used in investing activities		(55,073	)		(90,971	)
Cash flows from financing activities
Proceeds from revolving line of credit under credit agreement applicable to    respective period (Note 4)		37,975			130,800
Payments on revolving line of credit under credit agreement applicable to    respective period (Note 4)		(37,975	)		(130,800	)
Proceeds from term loan under credit agreement applicable to respective period (Note 4)		100,000			50,000
Payments on term loan under credit agreement applicable to respective period (Note 4)		(50,625	)		(24,688	)
Proceeds from delayed draw term loan under credit agreement applicable to    respective period (Note 4)		12,500			35,000
Payments on delayed draw term loan under credit agreement applicable to    respective period (Note 4)		(50,000	)		-
Proceeds from vehicle and equipment notes payable		16,310			12,817
Debt issuance costs		(1,238	)		(758	)
Principal payments on long term debt		(4,055	)		(2,631	)
Principal payments on capital lease obligations		(6,596	)		(7,276	)
Acquisition-related obligations		(2,732	)		-
Repurchase of common stock		—			(6,100	)
Surrender of common stock by employees		(836	)		-
Net cash provided by financing activities		12,728			56,364
Net change in cash		12,232			(5,496	)
Cash at beginning of period		6,818			10,761
Cash at end of period	$	19,050		$	5,265
Supplemental disclosures of cash flow information
Net cash paid during the period for:
Interest	$	3,904		$	2,171
Income taxes, net of refunds		10,428			8,327
Supplemental disclosure of noncash investing and financing activities
Vehicles capitalized under capital leases and related lease obligations		2,956			2,750
Seller obligations in connection with acquisition of businesses		2,849			12,364
Unpaid purchases of property and equipment included in accounts payable		2,140			-

See accompanying notes to condensed consolidated financial statements

4

INSTALLED BUILDING PRODUCTS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 1 – ORGANIZATION

Installed Building Products, Inc. (“IBP”), a Delaware corporation formed on October 28, 2011, and its subsidiaries (collectively referred to as the “Company” and “we”, “us” and “our”) primarily install insulation, garage doors, rain gutters, shower doors, closet shelving and mirrors, and other products for residential and commercial builders located in the continental United States. IBP operates in over 100 locations within the continental United States and its corporate office is located in Columbus, Ohio.

We have one operating segment and a single reportable segment. Substantially all of our sales come from service-based installation of various products in the residential new construction and repair and remodel and commercial construction end markets. Each of our branches has the capacity to serve all of our end markets. The following table sets forth the percentage of our net revenue by end market:

	Three months ended September 30,						Nine months ended September 30,
	2016			2015			2016			2015
Residential new construction and repair and remodel		89	%		89	%		88	%		89	%
Commercial construction		11	%		11	%		12	%		11	%
		100	%		100	%		100	%		100	%

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Principles of Consolidation

The accompanying condensed consolidated financial statements include all of our wholly owned subsidiaries and majority owned subsidiaries. The non-controlling interest relating to majority owned subsidiaries is not significant for presentation. All intercompany accounts and transactions have been eliminated.

The information furnished in the condensed consolidated financial statements includes normal recurring adjustments and reflects all adjustments which are, in the opinion of management, necessary for a fair presentation of the results of operations and statements of financial position for the interim periods presented. Certain information and footnote disclosures normally included in the consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the rules and regulations of the Securities and Exchange Commission (the “SEC”) have been condensed or omitted pursuant to such rules and regulations. We believe that the disclosures are adequate to prevent the information presented from being misleading when read in conjunction with our consolidated financial statements and the notes thereto included in Part II, Item 8, Financial Statements and Supplementary Data, of our Annual Report on Form 10-K for the fiscal year ended December 31, 2015 (the “2015 Form 10-K”), as filed with the SEC on March 9, 2016. The December 31, 2015 condensed consolidated balance sheet data was derived from the audited financial statements but does not include all disclosures required by U.S. GAAP.

Our interim operating results for the three and nine months ended September 30, 2016 are not necessarily indicative of the results to be expected in future operating quarters. See Part I, Item 1A. Risk Factors in our 2015 Form 10-K and Part II, Item 1A. Risk Factors in our Quarterly Reports on Form 10-Q for the periods ended June 30, 2016 and September 30, 2016 for additional information regarding risk factors that may impact our results.

Note 2 to the consolidated financial statements in our 2015 Form 10-K describes the significant accounting policies and estimates used in preparation of the consolidated financial statements. There have been no changes to our significant accounting policies or estimates during the three or nine months ended September 30, 2016.

Use of Estimates

Preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include the allowance for doubtful accounts, valuation allowance on deferred tax assets, valuation of the reporting unit, intangible assets and other long-lived assets, share-based compensation, reserves for general liability, and workers’ compensation and medical insurances. Management believes the accounting estimates are appropriate and reasonably determined; however, due to the inherent uncertainties in making these estimates, actual amounts could differ from such estimates.

5

INSTALLED BUILDING PRODUCTS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Advertising Costs

Advertising costs are expensed as incurred. Advertising expense was approximately $0.8 million and $2.2 million for the three and nine months ended September 30, 2016, respectively, and $0.6 million and $1.6 million for the three and nine months ended September 30, 2015, respectively, and is included in selling expense on the Condensed Consolidated Statements of Operations.

Recently Adopted Accounting Pronouncements

In April 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2015-03, “Simplifying the Presentation of Debt Issuance Costs.” Under this ASU, we present debt issuance costs in the balance sheet as a reduction from the related debt liability rather than as an asset. Amortization of such costs will continue to be reported as interest expense. During the nine months ended September 30, 2016, we retrospectively adopted ASU 2015-03, which resulted in a reclassification of $0.5 million of debt issuance costs related to our long-term debt from other non-current assets to long-term debt as of December 31, 2015.

In April 2015, the FASB issued ASU 2015-05, “Intangibles–Goodwill and Other–Internal-Use Software (Subtopic 350-40): Customer's Accounting for Fees Paid in a Cloud Computing Arrangement.” This update provides criteria for customers in a cloud computing arrangement to determine whether the arrangement includes a license of software. We adopted this guidance effective January 1, 2016 and have determined this ASU did not have a material impact on our condensed consolidated financial statements. 

In August 2015, the FASB issued ASU 2015-15, “Imputation of Interest (Subtopic 835-30).” This ASU amends ASU 2015-03 regarding the presentation and subsequent measurement of debt issuance costs related to line of credit arrangements. Specifically, it provides guidance for deferring and presenting debt issuance costs as an asset and subsequently amortizing the deferred debt issuance costs ratably over the term of the line of credit arrangement, regardless of whether there are any outstanding borrowings on the line of credit arrangement. We adopted this guidance effective January 1, 2016 and have determined this ASU did not have a material impact on our condensed consolidated financial statements. After applying the new guidance, deferred debt issuance costs, net of accumulated amortization, were $1.3 million and $0.6 million as September 30, 2016 and December 31, 2015, respectively.

In September 2015, the FASB issued ASU 2015-16, “Business Combinations (Topic 805).” This ASU requires an acquirer to retrospectively adjust provisional amounts recognized in a business combination during the measurement period. To simplify the accounting for adjustments made to provisional amounts, the amendments in this update require that the acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amount is determined. The acquirer is required to also record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date. In addition, an entity is required to present separately on the face of the income statement or disclose in the notes to the financial statements the portion of the amount recorded in current period earnings by line item that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date. For public business entities, this update is effective for fiscal years beginning after December 15, 2015, including interim periods within those fiscal years. While previous adjustments to provisional amounts did not have a material impact on our condensed consolidated financial statements, it is possible that future adjustments made during measurement periods to recently acquired entities or entities acquired in the future could have a material impact on our condensed consolidated financial statements.

In March 2016, the FASB issued ASU No. 2016-09, “Compensation-Stock Compensation (Topic 718).” This update amends the accounting for forfeitures, employer tax withholding on share-based compensation and the financial statement presentation of excess tax benefits or deficiencies. This ASU also clarifies the statement of cash flows presentation for certain components of share-based awards. As early adoption is permitted, we adopted this standard effective January 1, 2016 and have concluded that it did not have a material impact on our condensed consolidated financial statements. Under ASU 2016-09, we classify the excess income tax benefits from stock-based compensation arrangements as a discrete item within income tax expense, rather than recognizing such excess income tax benefits in additional paid-in capital. Excess income tax benefits from stock-based compensation arrangements are classified as an operating activity rather than as a financing activity. In addition, when we withhold shares from an employee’s vesting of common stock awards to fund payment by us of the employee’s taxes, the payment is classified as a financing activity. We have elected to continue to estimate the forfeitures expected to occur to determine the amount of compensation cost to be recognized in each period.

6

INSTALLED BUILDING PRODUCTS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Recently Issued Accounting Pronouncements Not Yet Adopted

In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606).” ASU 2014-09 sets forth a new revenue recognition model that requires identifying the contract(s) with a customer, identifying the performance obligations in the contract, determining the transaction price, allocating the transaction price to the performance obligations and recognizing the revenue upon satisfaction of performance obligations. In July 2015, the FASB voted to defer the application of the provisions of this standard for public companies until annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. We are still evaluating whether this ASU will have a material impact on our condensed consolidated financial statements.

In July 2015, the FASB issued ASU 2015-11, “Inventory (Topic 330).” This update requires an entity to measure inventory within the scope of the update at the lower of cost and net realizable value. For public business entities, this update is effective for financial statements issued for fiscal years beginning after December 15, 2016, and interim periods within those fiscal years. We are still evaluating whether this ASU will have a material impact on our condensed consolidated financial statements.

In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842).” This update amends the existing accounting standards for lease accounting, including requiring lessees to recognize most leases on their balance sheets and making targeted changes to lessor accounting. ASU 2016-02 requires a modified retrospective transition approach for all leases existing at, or entered into after, the date of initial application, with an option to use certain transition relief. For public business entities, this update is effective for annual reporting periods beginning after December 15, 2018, including interim periods within those fiscal years, and early adoption is permitted as of the standard’s issuance date. We are still evaluating whether this ASU will have a material impact on our condensed consolidated financial statements.

In March 2016, the FASB issued ASU 2016-06, “Derivatives and Hedging (Topic 815): Contingent Put and Call Options in Debt Instruments.” This ASU clarifies the requirement for assessing whether contingent call (put) options that can accelerate the payment of principal on debt instruments are clearly and closely related to their debt hosts. An entity performing the assessment under this amendment is required to assess the embedded call (put) options solely in accordance with the four-step decision sequence. Consequently, when a call (put) option is contingently exercisable, an entity does not have to assess whether the event that triggers the ability to exercise a call (put) option is related to interest rates or credit risks. For public business entities, this update is effective for financial statements issued for fiscal years beginning after December 15, 2016 and interim periods within those fiscal years. We are still evaluating whether this ASU will have a material impact on our condensed consolidated financial statements.

In April 2016, the FASB issued ASU No. 2016-10, “Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing,” which provides supplemental adoption guidance and clarification to ASU 2014-09. ASU 2016-10 must be adopted concurrently with the adoption of ASU 2014-09. We are still evaluating whether the future adoption of these pronouncements will have a material impact on our condensed consolidated financial statements.

In May 2016, the FASB issued ASU No. 2016-11, “Revenue Recognition (Topic 605) and Derivatives and Hedging (Topic 815): Rescission of SEC Guidance Because of Accounting Standards Updates 2014-09 and 2014-16 pursuant to Staff announcements at the March 3, 2016 EITF Meeting” This ASU rescinds from the FASB Accounting Standards Codification certain SEC paragraphs as a result of two SEC Staff Announcements at the March 3, 2016 meeting. For public entities, the amendments related to Topic 605 are effective for interim and annual reporting periods beginning after December 15, 2017 and amendments related to Topic 815 are effective for interim and annual reporting periods beginning after December 15, 2015. We are still evaluating whether the portion of this ASU related to Topic 605 will have a material impact on our condensed consolidated financial statements but have concluded that the portion of this ASU related to Topic 815 is not applicable and, therefore, did not have a material impact on our condensed consolidated financial statements.

In May 2016, the FASB issued ASU 2016-12, “Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients.” The amendments in this ASU provide additional clarification and implementation guidance on the previously issued ASU 2014-09. This ASU provides clarification to Topic 606 on how to assess collectability, present sales tax, treat noncash consideration, and account for completed and modified contracts at the time of transition. The amendment also clarifies that an entity retrospectively applying the guidance in Topic 606 is not required to disclose the effect of the accounting change in the period of adoption. The effective date and transition requirements for these amendments are the same as the effective date and transition requirements of ASU 2014-09, which is effective for fiscal years, and for interim periods within those years, beginning after December 15, 2017. We are still evaluating whether this ASU will have a material impact on our condensed consolidated financial statements.

7

INSTALLED BUILDING PRODUCTS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

In June 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” This ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. In addition, these amendments require the measurement of all expected credit losses for financial assets, including trade accounts receivable, held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. For public business entities, this update is effective for financial statements issued for fiscal years beginning after December 15, 2019 and interim periods within those fiscal years. We are still evaluating whether this ASU will have a material impact on our condensed consolidated financial statements.

In August 2016, the FASB issued ASU 2016-15, “Statement of Cash Flows: Clarification of Certain Cash Receipts and Cash Payments (Topic 230).” This ASU addresses the diversity in practice related to the classification of certain cash receipts and payments in the statement of cash flows by adding or clarifying guidance on eight specific cash flow issues. For public business entities, this update is effective for financial statements issued for fiscal years beginning after December 15, 2017 and interim periods within those fiscal years. We are still evaluating whether this ASU will have a material impact on our condensed consolidated financial statements.

In October 2016, the FASB issued ASU 2016-16, “Income Taxes (Topic 740): intra-entity transfers of assets other than inventory.” This ASU aligns the recognition of income tax consequences for intra-entity transfers of assets other than inventory with International Financial Reporting Standards (IFRS). For public business entities, this update is effective for financial statements issued for fiscal years beginning after December 15, 2017 and interim periods within those fiscal years. We are still evaluating whether this ASU will have a material impact on our condensed consolidated financial statements.

NOTE 3 – GOODWILL AND INTANGIBLES

Goodwill

The change in carrying amount of goodwill was as follows (in thousands):

	Goodwill (Gross)		Accumulated Impairment Losses			Goodwill (Net)
January 1, 2016	$	160,516	$	(70,004	)	$	90,512
Business Combinations		12,006		—			12,006
September 30, 2016	$	172,522	$	(70,004	)	$	102,518

We test goodwill for impairment annually during the fourth quarter of our fiscal year or earlier if there is an impairment indicator.  No impairment was recognized during either of the nine month periods ended September 30, 2016 and 2015.

Intangibles, net

The following table provides the gross carrying amount and accumulated amortization for each major class of intangibles (in thousands):

	As of September 30, 2016						As of December 31, 2015
	Gross Carrying Amount		Accumulated Amortization		Net Book Value		Gross Carrying Amount		Accumulated Amortization		Net Book Value
Amortized intangibles:
Customer relationships	$	75,261	$	25,562	$	49,699	$	62,399	$	20,231	$	42,168
Covenants not-to-compete		8,143		2,003		6,140		5,729		847		4,882
Trademarks and tradenames		34,436		9,852		24,584		28,320		8,152		20,168
	$	117,840	$	37,417	$	80,423	$	96,448	$	29,230	$	67,218

The gross carrying amount of intangibles increased approximately $21.4 million during the nine months ended September 30, 2016 primarily due to business combinations. See Note 10, Business Combinations, for more information. Remaining estimated aggregate annual amortization expense is as follows (amounts, in thousands, are for the fiscal year ended):

8

INSTALLED BUILDING PRODUCTS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Remainder of 2016	$	2,859
2017		11,045
2018		10,741
2019		10,229
2020		9,622
Thereafter		35,927

NOTE 4 – LONG-TERM DEBT

Debt consisted of the following (in thousands):

	As of September 30,			As of  December 31,
	2016			2015
Term loans, as amended, net of unamortized debt discount    of $477 and $249, respectively	$	97,030		$	47,876
Delayed draw term loans, as amended, net of unamortized    debt discount of $50 and $261, respectively		12,443			49,739
Vehicle and equipment notes, maturing through September    2021; payable in various monthly installments, including    interest rates ranging from 2% to 4%		33,414			21,091
Various notes payable, maturing through March 2025;    payable in various monthly installments, including interest    rates ranging from 4% to 6%		5,188			4,529
		148,075			123,235
Less: current maturities		(15,064	)		(10,021	)
Long-term debt, less current maturities	$	133,011		$	113,214

On February 29, 2016, we entered into a Credit and Security Agreement (the “Credit and Security Agreement”) with the lenders named therein. The Credit and Security Agreement amended and restated our previous credit agreement (the “2015 Credit Agreement”), which was scheduled to mature in April 2020. We used a portion of the funds from the Credit and Security Agreement to pay off the outstanding balances under the 2015 Credit Agreement. The Credit and Security Agreement provides for a five-year senior secured credit facility in an aggregate principal amount of up to $325.0 million, consisting of a $100.0 million revolving line of credit (the “Revolving LOC”), a $100.0 million term loan (the “Term Loan”), and a delayed draw term loan facility (the “DDTL”) providing for up to $125.0 million in additional term loan draws during the first year of the Credit and Security Agreement. Under the Revolving LOC, up to an aggregate of $20.0 million is available to us for the issuance of letters of credit and up to an aggregate of $5.0 million is available to us for swing line loans. The Credit and Security Agreement also includes an accordion feature which allows us, at our option but subject to lender and certain other approvals, to add up to an aggregate of $75.0 million in principal amount of term loans or additional revolving credit commitments, subject to the same terms as the Revolving LOC and Term Loan. As of September 30, 2016, there were approximately $18.0 million in letters of credit issued and no borrowings outstanding under the Revolving LOC. All of the obligations under the Credit and Security Agreement are guaranteed by our material domestic subsidiaries, other than Suburban Insulation, Inc.

Loans under the Credit and Security Agreement bear interest at either the eurodollar rate (“LIBOR”) or the base rate (which approximates prime rate), at our election, plus a margin based on the type of rate applied and our leverage ratio. At December 31, 2015, the outstanding balances on the term loan and the delayed draw term loan under the 2015 Credit Agreement bore interest at 1-month LIBOR, including margin (1.95%), and the outstanding balances on the Term Loan and DDTL at September 30, 2016 bore interest at 1-month LIBOR, including margin (2.31%).  In addition to interest, we are required to pay commitment fees on the unused portion of the Revolving LOC. The commitment fee rate for the period from February 29, 2016 through August 31, 2016, was 22.5 basis points. The commitment fee rate, like the interest rate spreads, is subject to adjustment with possible future commitment fees ranging from 20 to 30 basis points per annum. At September 30, 2016, our applicable commitment fee rate was 22.5 basis points.  We are also required to pay a ticking fee of 37.5 basis points per annum on the unused portion of the DDTL until it is fully drawn or February 28, 2017, whichever is earlier. Any outstanding principal balances on the Term Loan and DDTL are due on February 28, 2021 (the “Maturity Date”).

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INSTALLED BUILDING PRODUCTS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The Credit and Security Agreement contains covenants that require us to (1) maintain a fixed charge coverage ratio of not less than 1.10 to 1.0 and (2) maintain a leverage ratio of no greater than: (a) 3.50 to 1.00 through December 30, 2016; (b) 3.25 to 1.00 on December 31, 2016 through June 29, 2017; (c) 3.00 to 1.00 on June 30, 2017 through December 30, 2017; (d) 2.75 to 1.00 on December 31, 2017 through June 29, 2018; and (e) 2.50 to 1.00 on June 30, 2018 and thereafter.  The Credit and Security Agreement also contains various restrictive non-financial covenants and a provision that, upon an event of default (as defined by the Credit and Security Agreement), amounts outstanding under the Credit and Security Agreement would bear interest at the rate as determined above plus 2.0% per annum.

Vehicle and Equipment Notes

We are party to a Master Loan and Security Agreement (“Master Loan and Security Agreement”), a Master Equipment Lease Agreement (“Master Equipment Agreement”) and one or more Master Loan Agreements (“Master Loan Agreements”) with various lenders to provide financing for the purpose of purchasing or leasing vehicles and equipment used in the normal course of business. Each financing arrangement under these agreements constitutes a separate note and obligation. Vehicles and equipment purchased or leased under each financing arrangement serve as collateral for the note applicable to such financing arrangement. Regular payments are due under each note for a period of typically 60 consecutive months after the incurrence of the obligation. The specific terms of each note are based on specific criteria, including the type of vehicle or equipment and the market interest rates at the time. No termination date applies to these agreements.

Total gross assets relating to our master loan and equipment agreements were $43.5 million and $25.4 million as of September 30, 2016 and December 31, 2015, respectively, none of which were fully depreciated as of September 30, 2016 or December 31, 2015, respectively. The net book value of assets under these agreements was $35.2 million and $22.4 million as of September 30, 2016 and December 31, 2015, respectively. Depreciation of assets held under these agreements is included within cost of sales on the Condensed Consolidated Statements of Operations.

NOTE 5 – FAIR VALUE MEASUREMENTS

Fair Values

Fair value is the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.

Accounting Standards Codification (“ASC”) 820, “Fair Value Measurement,” establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value:

Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3: Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

Estimated Fair Value of Financial Instruments

Accounts receivable, accounts payable and accrued liabilities as of September 30, 2016 and December 31, 2015 approximate fair value due to the short-term maturities of these financial instruments. The carrying amounts of the long-term debt, including the Term Loan, DDTL and Revolving LOC, approximate fair value as of September 30, 2016 and December 31, 2015 due to the short term maturities of the underlying variable rate LIBOR agreements. The carrying amounts of the obligations associated with our vehicle and equipment notes approximate fair value as of September 30, 2016 and December 31, 2015 because the associated assets generate sufficient cash through operations to settle the obligations. All debt classifications represent Level 2 fair value measurements.

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INSTALLED BUILDING PRODUCTS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 6 – EMPLOYEE BENEFITS

Healthcare

Our healthcare benefit expense (net of employee contributions) for all plans was approximately $3.7 million and $3.0 million for the three months ended September 30, 2016 and 2015, respectively, and $11.4 million and $8.9 million for the nine months ended September 30, 2016 and 2015, respectively, and is included in administrative expenses on our Condensed Consolidated Statements of Operations. An accrual for estimated healthcare claims incurred but not reported (“IBNR”) is included within accrued compensation on the Condensed Consolidated Balance Sheets and was $1.6 million and $1.5 million as of September 30, 2016 and December 31, 2015, respectively.

Workers’ Compensation

Workers’ compensation expense totaled $3.4 million and $2.6 million for the three months ended September 30, 2016 and 2015, respectively, and $9.2 million and $6.6 million for the nine months ended September 30, 2016 and 2015, respectively, and is included in costs of sales on our Condensed Consolidated Statements of Operations. Workers’ compensation known claims and IBNR reserves included on the Condensed Consolidated Balance Sheets were as follows (in thousands):

	September 30,		December 31,
	2016		2015
Included in other current liabilities	$	4,033	$	3,263
Included in other long-term liabilities		7,503		7,132
	$	11,536	$	10,395

We also had an insurance receivable for claims that exceeded the stop loss limit included on the Condensed Consolidated Balance Sheets.  That receivable offsets an equal liability included within the reserve amounts noted above and was as follows (in thousands):

	September 30,		December 31,
	2016		2015
Included in other non-current assets	$	1,256	$	1,542

Share-Based Compensation

Directors

During the nine months ended September 30, 2016 and 2015, we granted approximately 9 thousand and 13 thousand shares of our common stock, respectively, under our 2014 Omnibus Incentive Plan to non-employee members of our Board of Directors. Accordingly, for the nine months ended September 30, 2016 and 2015, we recorded $0.3 million in compensation expense within administrative expenses on the Condensed Consolidated Statements of Operations. These shares effectively vested on the grant date since there is deemed to be no service period associated with these awards. The lack of a vesting or service period may not apply to any future share grants under our 2014 Omnibus Incentive Plan.

Employees

During the nine months ended September 30, 2016, we granted approximately 0.1 million shares of our common stock under our 2014 Omnibus Incentive Plan to our employees, which vest in three equal installments (rounded to the nearest whole share) on each of April 20, 2017, April 20, 2018 and April 20, 2019.

During the nine months ended September 30, 2016, our employees surrendered approximately 32 thousand shares of our common stock to satisfy tax withholding obligations arising in connection with the vesting of such common stock awards previously issued under our 2014 Omnibus Incentive Plan. Share-based compensation expense was $0.4 million and $1.2 million for the three and nine months ended September 30, 2016, respectively. We recognized excess tax benefits of approximately $0.3 million within administrative expenses on the Condensed Consolidated Statements of Operations for the nine months ended September 30, 2016. We did not recognize any such excess tax benefits in the three months ended September 30, 2016.

During the nine months ended September 30, 2015, we granted approximately 0.1 million shares of our common stock under our 2014 Omnibus Incentive Plan to our employees.  Shares issued to non-executive employees vested 100% between January 7, 2016 and March 31, 2016, and shares issued to certain officers vest(ed) in three equal installments (rounded to the nearest whole share) on each

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

of March 31, 2016, March 31, 2017 and March 31, 2018.  Share-based compensation expense was $0.6million and $1.2million for thethree and nine months ended September 30, 2015.

Nonvested common stock awards for employees as of December 31, 2015 and changes during the nine months ended September 30, 2016 were as follows:

	Common Stock Awards			Weighted Average Grant Date Fair Market Value Per Share
Nonvested common stock awards at December 31, 2015		129,053		$	21.52
Granted		143,528			26.98
Vested		(109,473	)		21.48
Forfeited		(1,183	)		24.97
Nonvested common stock awards at September 30, 2016		161,925		$	26.37

As of September 30, 2016, there was $3.4 million of unrecognized compensation expense related to nonvested common stock awards. This expense is subject to future adjustments for forfeitures and is expected to be recognized on a straight-line basis over the remaining weighted-average period of 2.5 years. Shares forfeited are returned as treasury shares and available for future issuances.

As of September 30, 2016, approximately 2.7 million shares of common stock were available for issuance under the 2014 Omnibus Incentive Plan.

NOTE 7 – INCOME TAXES

Our provision for income taxes as a percentage of pretax earnings (“effective tax rate”) is based on a current estimate of the annual effective income tax rate adjusted to reflect the impact of discrete items.

During the three and nine months ended September 30, 2016, the effective tax rate was 36.8 percent and 35.1 percent, respectively. These rates were favorably impacted by deductions related to domestic production activities, early adoption of ASU 2016-09 and the release of a valuation allowance due to utilization of net operating losses. The rates were partially offset by separate tax filing entities in a loss position for which a full valuation allowance will be accounted for against the losses, causing no tax benefit to be recognized on the losses.

On March 30, 2016, the FASB issued ASU 2016-09 which simplified several aspects of the accounting for employee share-based payment transactions. We decided to early adopt ASU 2016-09 and per its guidance recognized $0.3 million of excess income tax benefits from stock-based compensation arrangements as a discrete item within income tax expense for the nine months ended September 30, 2016. We did not recognize any excess income tax benefits related to the adoption of ASU 2016-09 during the three months ended September 30, 2016.

NOTE 8 – RELATED PARTY TRANSACTIONS

We sell installation services to other companies related to us through common or affiliated ownership and/or Board of Directors and/or management relationships. We also purchase services and materials and pay rent to companies with common or related ownership.

We lease our headquarters and certain other facilities from related parties. See Note 9, Commitments and Contingencies, for future minimum lease payments to be paid to these related parties.

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INSTALLED BUILDING PRODUCTS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

For the three and nine months ended September 30, 2016and 2015, the amount of sales to related parties as well as the purchases from and rent expense paid to related parties were as follows (in thousands):

	Three months ended September 30,				Nine months ended September 30,
	2016		2015		2016		2015
Sales	$	2,182	$	1,924	$	5,282	$	4,661
Purchases		114		80		370		366
Rent		163		150		472		446

As of September 30, 2016 and December 31, 2015, we had related party balances of approximately $1.4 million and $1.8 million, respectively, included in accounts receivable on our Condensed Consolidated Balance Sheets. These balances represent trade accounts receivable arising during normal course of business with various related parties. M/I Homes, Inc., a customer whose Chairman, President and Chief Executive Officer is a member of our Board of Directors, accounted for $0.8 million and $1.0 million of these balances as of September 30, 2016 and December 31, 2015, respectively.

On March 13, 2015, we entered into a share repurchase agreement with Installed Building Systems, Inc. (“IBS”), a related party, for the purchase of approximately 0.3 million shares of our common stock for a purchase price of approximately $6.1 million (or $19.23 per share, which represented a 7.5% discount to the last reported price of our common stock on March 13, 2015).

NOTE 9 – COMMITMENTS AND CONTINGENCIES

Accrued General Liability

Accrued general insurance reserves included on the Condensed Consolidated Balance Sheets were as follows (in thousands):

	September 30, 2016		December 31, 2015
Included in other current liabilities	$	1,667	$	1,304
Included in other long-term liabilities		8,514		6,879
	$	10,181	$	8,183

We also had general liability insurance receivables included on the Condensed Consolidated Balance Sheets that, in aggregate, offset an equal liability included within the reserve amounts noted above.  The amounts were as follows (in thousands):

	September 30, 2016		December 31, 2015
General liability insurance receivable and indemnification    asset for claims under a fully insured policy	$	2,815	$	2,815
General liability insurance receivable for claims that exceeded    the stop loss limit		907		821
Total general liability insurance receivables included in other    non-current assets	$	3,722	$	3,636

Leases

We are obligated under capital leases covering vehicles and certain equipment. The vehicle and equipment leases generally have terms ranging from four to six years. Total gross assets relating to capital leases were approximately $64.7 million and $64.9 million as of September 30, 2016 and December 31, 2015, respectively, and a total of approximately $23.1 million and $19.1 million were fully depreciated as of September 30, 2016 and December 31, 2015, respectively. The net book value of assets under capital leases was approximately $17.8 million and $22.1 million as of September 30, 2016 and December 31, 2015, respectively, net of accumulated depreciation of $46.9 million and $42.8 million as of September 30, 2016 and December 31, 2015, respectively. Amortization of assets held under capital leases is included within cost of sales on the Condensed Consolidated Statements of Operations.

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INSTALLED BUILDING PRODUCTS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

We also have several noncancellable operating leases, primarily for buildings, improvements, equipment, and certain vehicles. These leases generally contain renewal options for periods ranging from one to five years and require us to pay all executory costs such as property taxes, maintenance and insurance.

In some instances, lease agreements exist with related parties. Future minimum lease payments under noncancellable operating leases (with initial or remaining lease terms in excess of one year) with related parties as of September 30, 2016 are as follows (amounts, in thousands, are as of the fiscal year ended):

Remainder of 2016	$	133
2017		366
2018		155
2019		—
2020		—
Thereafter		—

Supply Contract Commitments

As of September 30, 2016, we had two product supply contracts, one extending through December 31, 2016 and one extending through August 31, 2017. The contract extending through August 31, 2017 has been suspended through December 31, 2016. Our obligations for both contracts are based on quantity without a specific rate applied and therefore are not quantifiable. We expect our quantity of purchases to exceed the minimum quantity commitments for all years covered by the contracts. Actual purchases made under the contract extending through December 31, 2016 for the three months ended September 30, 2016 and 2015 were approximately $6.5 million and $16.6 million, respectively, and $32.9 million and $41.5 million for the nine months ended September 30, 2016 and 2015, respectively.

Other Commitments and Contingencies

From time to time, various claims and litigation are asserted or commenced against us principally arising from contractual and tort matters and personnel and employment disputes. In determining loss contingencies, management considers the likelihood of loss as well as the ability to reasonably estimate the amount of such loss or liability. An estimated loss is recorded when it is considered probable that such a liability has been incurred and when the amount of loss can be reasonably estimated. As litigation is subject to inherent uncertainties, we cannot be certain that we will prevail in these matters. However, we do not believe that the ultimate outcome of any pending matters will have a material adverse effect on our consolidated financial position, results of operations or cash flows.

NOTE 10 – BUSINESS COMBINATIONS

As part of our ongoing strategy to increase market share in certain markets, we completed six business combinations during the nine months ended September 30, 2016 and five business combinations during the nine months ended September 30, 2015. The goodwill recognized in conjunction with these business combinations is attributable to expected improvement in the business of these acquired companies.  Approximately $12.8 million and $22.1 million of the goodwill from acquisitions completed during the nine months ended September 30, 2016 and 2015, respectively, is expected to be tax deductible.

2016

On January 25, 2016, we acquired substantially all of the assets of Key Green Builder Services, LLC d/b/a Key Insulation. The purchase price consisted of cash of $5.0 million and seller obligations of $0.7 million. Revenue and net loss since the date of acquisition included in our Condensed Consolidated Statements of Operations for the three months ended September 30, 2016 were $2.0 million and $0.2 million, respectively, and $6.3 million and $0.4 million, respectively, for the nine months ended September 30, 2016.

On February 2, 2016, we acquired substantially all of the assets of Marshall Insulation, LLC (“Marshall”).  The purchase price consisted of cash of $0.9 million and seller obligations of $0.1 million. Revenue and net loss since the date of acquisition included in our Condensed Consolidated Statements of Operations for the three months ended September 30, 2016 were $1.0 million and $54 thousand, respectively, and $2.5 million and $0.2 million, respectively, for the nine months ended September 30, 2016.

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INSTALLED BUILDING PRODUCTS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

On February 29, 2016, we acquired substantially all of the assets of Kern Door Company, Inc. (“Kern”). The purchase price consisted of cash of $2.9 million and seller obligations of $0.1 million. Revenue and net loss since the date of acquisition included in our Condensed Consolidated Statements of Operations for the three months ended September 30, 2016 were $1.0 million and $62thousand, respectively, and $2.0 million and $0.2 million, respectively, for the nine months ended September 30, 2016.

On April 12, 2016, we acquired substantially all of the assets of Alpine Insulation Co., Inc. (“Alpine”). The purchase price consisted of cash of $21.2 million and seller obligations of $1.6 million. Revenue and net income since the date of acquisition included in our Condensed Consolidated Statements of Operations for the three months ended September 30, 2016 were $7.9 million and $0.8 million, respectively, and $14.7 million and $1.2 million, respectively, for the nine months ended September 30, 2016.

On July 25, 2016, we acquired substantially all of the assets of FireClass, LLC (“FireClass”). The purchase price consisted of cash of $2.3 million. Revenue and net income since the date of acquisition included in our Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2016 were $0.8 million and $21 thousand, respectively.

On August 15, 2016, we acquired substantially all of the assets of Southern Insulators & Specialties, LLC (“Southern”). The purchase price consisted of cash of $4.1 million and seller obligations of $0.4 million. Revenue and net income since the date of acquisition included in our Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2016 were $0.7 million and $0.1 million, respectively.

2015

On March 12, 2015, we acquired 100% of the stock and membership interests of nine different legal entities, collectively referred to as BDI Insulation (“BDI”).  The purchase price consisted of cash of $30.7 million and seller obligations of $5.8 million. Revenue and net income since the date of acquisition included in our Condensed Consolidated Statements of Operations for the three months ended September 30, 2015 were $10.3 million and $0.6 million, respectively, and $22.5 million and $1.6 million, respectively, for the nine months ended September 30, 2015.

On April 6, 2015, we acquired 100% of the common stock of C.Q. Insulation Inc. (“CQ”). The purchase price consisted of cash of $5.2 million and seller obligations of $2.3 million. Revenue and net income since the date of acquisition included in our Condensed Consolidated Statements of Operations for the three months ended September 30, 2015 were $2.7 million and $0.3 million, respectively, and $5.4 million and $0.5 million, respectively, for the nine months ended September 30, 2015.

On June 1, 2015, we acquired substantially all of the assets of Layman Brothers Contracting (“Layman”). The purchase price consisted of cash of $9.1 million and seller obligations of $0.6 million. Revenue and net income since the date of acquisition included in our Condensed Consolidated Statements of Operations for the three months ended September 30, 2015 were $3.7 million and $0.3 million, respectively, and $4.9 million and $0.4 million, respectively, for the nine months ended September 30, 2015.

On July 1, 2015, we acquired substantially all of the assets of EcoLogic Energy Solutions (“EcoLogic”). The purchase price consisted of cash of $3.0 million and seller obligations of $0.5 million. Revenue and net income since the date of acquisition included in our Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2015 were $1.8 million and $36 thousand, respectively.

On August 10, 2015, we acquired 100% of the common stock of Eastern Contractor Services (“Eastern”). The purchase price consisted of cash of $24.2 million and seller obligations of $2.9 million. Revenue and net income since the date of acquisition included in our Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2015 were $3.0 million and $0.3 million, respectively.

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INSTALLED BUILDING PRODUCTS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Purchase Price Allocations

The estimated fair values of the assets acquired and liabilities assumed for the acquisitions, as well as total purchase prices and cash paid, approximated the following as of September 30, and as may be adjusted during the valuation period since acquisition (in thousands):

	2016									2015
	Alpine			Other			Total			BDI			CQ			Layman			Eastern			Other			Total
Estimated fair values:
Cash	$	—		$	—		$	—		$	661		$	100		$	-		$	165		$	—		$	926
Accounts receivable		3,959			2,031			5,990			4,735			1,423			1,245			2,768			1,049			11,220
Inventories		700			888			1,588			980			152			267			335			119			1,853
Other current assets		18			12			30			368			39			-			109			10			526
Property and equipment		656			1,187			1,843			1,006			190			733			1,364			406			3,699
Intangibles		12,800			8,492			21,292			21,280			4,350			5,330			13,871			1,827			46,658
Goodwill		6,624			5,368			11,992			16,213			3,035			3,143			9,904			875			33,170
Other non-current assets		—			70			70			3,736			—			—			322			56			4,114
Accounts payable and other current    liabilities		(2,046	)		(1,459	)		(3,505	)		(3,303	)		(1,539	)		(1,030	)		(1,681	)		(783	)		(8,336	)
Deferred income tax liabilities		—			(24	)		(24	)		(5,495	)		—			—			—			—			(5,495	)
Long term debt																				(82	)					(82	)
Other long-term liabilities		—			—			—			(3,736	)		(238	)		-			(1	)		—			(3,975	)
Fair value of assets acquired    and purchase price		22,711			16,565			39,276			36,445			7,512			9,688			27,074			3,559			84,278
Less seller obligations		1,560			1,289			2,849			5,765			2,319			600			2,875			544			12,103
Cash paid	$	21,151		$	15,276		$	36,427		$	30,680		$	5,193		$	9,088		$	24,199		$	3,015		$	72,175

Further adjustments to the allocation for each acquisition still under its measurement period are expected as third-party or internal valuations are finalized, certain tax aspects of the transaction are completed, and customary post-closing reviews are concluded during the measurement period attributable to each individual business combination. As a result, insignificant adjustments to the fair value of assets acquired, and in some cases total purchase price, have been made to certain business combinations since the date of acquisition and future adjustments may be made through the end of each measurement period. Goodwill and intangibles per the above table do not agree to the total gross increases of these assets as shown in Note 3—Goodwill and Intangibles during the nine months ended September 30, 2016 due to minor adjustments to goodwill for the allocation of certain acquisitions still under measurement as well as other immaterial intangible assets added during the ordinary course of business. In addition, goodwill and intangibles increased during the nine months ended September 30, 2015 due to an immaterial tuck-in acquisition that does not appear in the above table.

Included in other noncurrent assets in the above table as of September 30, 2016 and 2015 is an insurance receivable of $2.0 million and an indemnification asset associated with the acquisition of BDI in the amount of $1.6 million. These assets offset equal liabilities included in other long-term liabilities in the same table, which represent additional insurance reserves and an uncertain tax position liability for which we may be liable. All amounts are measured at their acquisition date fair value.

Estimates of acquired intangible assets related to the acquisitions are as follows (dollars in thousands):

	2016				2015
Acquired intangibles assets	Estimated Fair Value		Weighted Avg Estimated Useful Life (yrs)		Estimated Fair Value		Weighted Avg Estimated Useful Life (yrs)
Customer relationships	$	12,862		9	$	29,958		8
Trademarks and trade names		6,116		15		12,882		15
Non-competition agreements		2,314		5		3,818		5

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INSTALLED BUILDING PRODUCTS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Pro Forma Information

The unaudited pro forma information for the combined results of the Company has been prepared as if the 2016 acquisitions had taken place on January 1, 2015 and the 2015 acquisitions had taken place on January 1, 2014. The unaudited pro forma information is not necessarily indicative of the results that we would have achieved had the transactions actually taken place on January 1, 2015 and 2014, and the unaudited pro forma information does not purport to be indicative of future financial operating results.  See Note 12, Business Combinations, to our audited financial statements in Item 8 of Part II of our 2015 Form 10-K for additional information on 2015 acquisitions included in the table below (in thousands, except per share data):

	Pro forma for the three months ended September 30,				Pro forma for the nine months ended September 30,
	2016		2015		2016		2015
Net revenue	$	226,329	$	202,830	$	642,343	$	554,882
Net income attributable to common stockholders	$	11,709	$	10,211	$	27,387	$	19,353
Basic net income per share attributable to    common stockholders	$	0.37	$	0.33	$	0.88	$	0.62
Diluted net income per share attributable to    common stockholders	$	0.37	$	0.33	$	0.87	$	0.62

Unaudited pro forma net income attributable to common stockholders reflects additional intangible asset amortization expense of $37 thousand and $1.2 million for the three months ended September 30, 2016 and 2015, respectively, and $0.7 million and $4.9 million for the nine months ended September 30, 2016 and 2015, respectively, that would have been recorded had the 2016 acquisitions taken place on January 1, 2015 and the 2015 acquisitions taken place on January 1, 2014.  

Unaudited pro forma net income attributable to common stockholders also includes additional income tax expense of $0.1 million and $0.3 million for the three months ended September 30, 2016 and 2015, respectively, and $18 thousand and $1.2 million for the nine months ended September 30, 2016 and 2015, respectively, that would have been recorded had the 2016 acquisitions taken place on January 1, 2015 and the 2015 acquisitions taken place on January 1, 2014.

In addition, approximately $1.0 million in transaction costs incurred by a seller resulting from a business combination that occurred during the nine months ended September 30, 2015 were included in earnings reported for the nine months ended September 30, 2014 and, therefore, are not included in proforma net income reported in the table above.

NOTE 11 –INCOME PER COMMON SHARE

Basic net income per share is calculated by dividing net income attributable to common stockholders by the weighted average shares outstanding during the period, without consideration for common stock equivalents.

Diluted net income per share is calculated by adjusting weighted average shares outstanding for the dilutive effect of common stock equivalents outstanding for the period, determined using the treasury stock method. Potential common stock is included in the diluted income per share calculation when dilutive. Diluted income per share was as follows (in thousands, except share and per share data):

	For the three months ended September 30,				For the nine months ended September 30,
	2016		2015		2016		2015
Net income attributable to common stockholders - basic    and diluted	$	11,549	$	9,481	$	27,355	$	17,230
Weighted average number of common shares outstanding		31,323,600		31,237,275		31,294,596		31,318,682
Dilutive effect of outstanding common stock awards    after application of the Treasury Stock Method		54,190		51,334		57,395		24,548
Diluted shares outstanding		31,377,790		31,288,609		31,351,991		31,343,230
Basic income per share attributable to common stockholders	$	0.37	$	0.30	$	0.87	$	0.55
Diluted income per share attributable to common    stockholders	$	0.37	$	0.30	$	0.87	$	0.55

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INSTALLED BUILDING PRODUCTS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 12 – SUBSEQUENT EVENTS

On October 17, 2016, we acquired substantially all of the assets of East Coast Insulators II, L.L.C. for total consideration of approximately $16.5 million, subject to a working capital adjustment. The initial accounting for the business combination was not complete at the time the financial statements were issued due to the timing of the acquisition and the filing of this Quarterly Report on Form 10-Q. As a result, disclosures required under ASC 805-10-50, Business Combinations, cannot be made at this time.

On October 29, 2016, we entered into a Share Purchase Agreement to acquire all of the outstanding shares of Trilok Industries, Inc.,the sole equityholder of Alpha Insulation and Waterproofing, Inc., and Alpha Insulation and Waterproofing Company (collectively “Alpha”) for aggregate consideration of approximately $92.1 million, which includes $9.2 million by issuing 282,577 shares of the Company’s common stock with the remainder paid in cash.  In addition, we will incur seller obligations totaling $1.9 million and the purchase price is subject to customary adjustments for cash and net working capital.  We will also pay in full certain indebtedness of Alpha. Any payment for indebtedness in excess of approximately $0.4 million will reduce the amount of the purchase price by a corresponding amount.  We may also be required to pay an additional amount in cash as earnout consideration.  Consummation of the acquisition is subject to (i) customary closing conditions, including receipt of certain antitrust regulatory approvals, accuracy of representations (subject to materiality qualifiers) and compliance with covenants in all material respects; (ii) certain persons having agreed to employment offer letters and noncompetition agreements; (iii) certain individuals having agreed to release and waiver agreements and (iv) the receipt of certain documents with respect to leased properties.  We currently expect to fund and close this acquisition in the first quarter of 2017.  If the close does not occur by February 25, 2017, the parties can terminate the definitive purchase agreement, subject to an extension for antitrust regulatory approval and certain other conditions.

On November 1, 2016, we acquired substantially all of the assets of Mike’s Garage Door, L.L.C. for total consideration of approximately $0.6 million. The initial accounting for the business combination was not complete at the time the financial statements were issued due to the timing of the acquisition and the filing of this Quarterly Report on Form 10-Q. As a result, disclosures required under ASC 805-10-50, Business Combinations, cannot be made at this time.

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Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations

This Management's Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with our consolidated financial statements and related notes in “Item 1. Financial Statements” of this Form 10-Q, as well as our Annual Report on Form 10-K for the year ended December 31, 2015 (our “2015 Form 10-K”).

OVERVIEW

We are the second largest new residential insulation installer in the United States based on our internal estimates, with a national platform consisting of over 100 locations serving customers in all 48 continental states and the District of Columbia. We also install complementary building products, including garage doors, rain gutters, shower doors, closet shelving and mirrors. Substantially all of our net revenue comes from service-based installation of these products in the residential new construction, repair and remodel and commercial construction end markets.

A large portion of our net revenue comes from the U.S. residential new construction market, which depends upon a number of economic factors, including demographic trends, interest rates, consumer confidence, employment rates, housing inventory levels, foreclosure rates, the health of the economy and availability of mortgage financing.

We believe our business is well positioned to continue to profitably grow during the housing recovery due to our strong balance sheet, liquidity and continuing acquisition strategy. We may adjust our strategies based on housing demand and our performance in each of our markets. Nevertheless, the pace of the housing recovery and our future results could be negatively affected by weakening economic conditions and decreases in housing demand and affordability as well as increases in interest rates and tightening of mortgage lending practices.

We manage all aspects of the installation process for our customers, from our direct purchase and receipt of materials from national manufacturers, to our timely supply of materials to job sites and quality installation. Installation of insulation, including air sealing, is a critical phase in the construction process, as certain other interior work cannot begin until the insulation phase passes inspection. Our branches have expertise in local building codes and energy-efficient building practices, and strong working relationships with homebuilders and on-site construction managers. At the same time, our centralized corporate support functions allow us to leverage our longstanding supplier relationships, web-based information system and other dedicated corporate services to benefit our operations as a whole.

On October 29, 2016, we entered into a definitive agreement to acquire Trilok Industries, Inc., Alpha Insulation & Waterproofing, Inc. and Alpha Insulation & Waterproofing Company (collectively, “Alpha”). Alpha serves commercial customers through an expanding network of 8 branch locations located in Georgia, Florida, Texas, Alabama, Tennessee and North Carolina. Alpha’s products include waterproofing, insulation, fireproofing and fire stopping. Alpha services large, long-lead time commercial projects including office buildings, airports, sports complexes, museums, hospitals, hotels and educational facilities. We expect the acquisition to significantly increase our sales mix to commercial end markets and expand and diversify our existing product mix. Consummation of the acquisition is subject to (i) customary closing conditions, including receipt of certain antitrust regulatory approvals, accuracy of representations (subject to materiality qualifiers) and compliance with covenants in all material respects; (ii) certain persons having agreed to employment offer letters and noncompetition agreements; (iii) certain individuals having agreed to release and waiver agreements and (iv) the receipt of certain documents with respect to leased properties. We currently expect to fund and close this acquisition in the first quarter of 2017.  If the close does not occur by February 25, 2017, the parties can terminate the definitive purchase agreement, subject to an extension for antitrust regulatory approval and certain other conditions.

Three Months Ended September 30, 2016 Compared to the Three Months Ended September 30, 2015

Net revenue

For the three months ended September 30, 2016, net revenue increased $43.8 million or 24.1%, to $225.4 million from $181.6 million for the three months ended September 30, 2015. The increase in net revenue included revenue from acquisitions of $21.7 million and revenue of $13.3 million predominantly attributable to organic growth in the volume of completed jobs in all of our end markets. The remaining increase in net revenue of $8.8 million resulted from a variety of factors, including customer and product mix, market pricing variations and insulation volumes driven by building code requirements. None of these additional factors was more significant than any other.

Cost of sales

For the three months ended September 30, 2016, cost of sales increased $29.9 million, or 23.4%, to $158.1 million from $128.2 million for the three months ended September 30, 2015. As a percentage of net revenue, cost of sales decreased to 70.2% during the

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three months ended September 30, 2015 from 70.6% during the three months ended September 30, 2015 attributable to market pricing improvements, better fuel utilization and leverage of other items included in cost of sales. On a dollar basis, cost of sales included increases from acquired businesses of approximately $15.2 million. Approximately $9.0 million was predominantly attributable to organic growth in the volume of completed jobs in the residential new construction end market. Additionally, cost of sales increased $5.7 million as a result of a variety of factors including customer and product mix, market pricing variations and insulation volumes driven by building code requirements. None of these additional factors was more significant than any other.

Gross Profit

For the three months ended September 30, 2016, gross profit increased $13.9 million to $67.3 million from $53.4 million for the three months ended September 30, 2015. As a percentage of net revenue, gross profit increased to 29.8% for the three months ended September 30, 2016 from 29.4% for the three months ended September 30, 2015 primarily due to a favorable change in our customer and product mix, market pricing variations and insulation volumes, better fuel utilization and leverage of other items included in costs of sales.

Operating expenses

Selling

For the three months ended September 30, 2016, selling expenses increased $2.7 million, or 26.7%, to $13.0 million from $10.3 million for the three months ended September 30, 2015. As a percentage of net revenue, selling expenses were relatively flat, increasing to 5.8% for the three months ended September 30, 2016 from 5.7% for the three months ended September 30, 2015. On a dollar basis, the increase in selling expenses was primarily due to higher wages, benefits and commissions of $2.3 million which supported both organic and acquisition-related growth.

Administrative

For the three months ended September 30, 2016, administrative expenses increased $5.7 million, or 21.9%, to $31.5 million from $25.8 million for the three months ended September 30, 2015. The increase in administrative expenses generally related to the cost of completing acquisitions, the ongoing costs associated with these newly-acquired entities and costs to support our growth. Wages and benefits increased $3.1 million, of which $1.3 million was attributable to acquisitions and $1.8 million was to support our organic growth. In addition, facility costs increased $0.8 million, of which $0.5 million was attributable to acquisitions. Information technology-related expenses increased $0.4 million, of which $0.2 million was attributable to acquisitions. The remaining increase in administrative expenses of $1.4 million included individually minor increases in several categories necessary to support our growing business.

Amortization

For the three months ended September 30, 2016, amortization expense increased $1.1 million to $2.9 million from $1.8 million for the three months ended September 30, 2015. The increase in amortization expense was attributable to the increase in finite-lived intangible assets obtained as a result of acquisitions.

Other expense

For the three months ended September 30, 2016, other expense increased $0.5 million to $1.6 million from $1.1 million for the three months ended September 30, 2015 due to increased interest expense on higher debt levels to support our growth related to acquisitions.

Income tax provision

During the three months ended September 30, 2016, we recorded an income tax provision of approximately $6.7 million on our income from continuing operations before income taxes of approximately $18.3 million, or an effective tax rate of 36.8%. This rate was favorably impacted by deductions related to domestic production activities and the release of a valuation allowance due to utilization of net operating losses. The favorability was partially offset by separate tax filing entities in a loss position for which a full valuation allowance will be accounted for against the losses, causing no tax benefit to be recognized on the losses.

During the three months ended September 30, 2015, we recorded an income tax provision of approximately $4.9 million on our income from continuing operations before income taxes of approximately $14.4 million, or an effective tax rate of 33.9%. This rate was favorably impacted by deductions related to domestic production activities. The favorability was partially offset by separate tax

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filing entities in a loss position for which a full valuation allowance will be accounted for against the losses, causing no tax benefit to be recognized on the losses.

Nine Months Ended September 30, 2016 Compared to the Nine Months Ended September 30, 2015

Net revenue

For the nine months ended September 30, 2016, net revenue increased $157.8 million or 33.5%, to $629.0 million from $471.2 million for the nine months ended September 30, 2015. The increase in net revenue included revenue from acquisitions of $74.7 million and revenue of $48.0 million predominantly attributable to organic growth in the volume of completed jobs in all of our end markets. The remaining increase in net revenue of $35.1 million resulted from a variety of factors, including customer and product mix, market pricing variations and insulation volumes driven by building code requirements. None of these additional factors was more significant than any other.

Cost of sales

For the nine months ended September 30, 2016, cost of sales increased $107.5 million, or 31.9%, to $444.9 million from $337.4 million for the nine months ended September 30, 2015. As a percentage of net revenue, cost of sales decreased to 70.7% during the nine months ended September 30, 2016 from 71.6% during the nine months ended September 30, 2015 attributable to market pricing improvements, better fuel utilization and leverage of other items included in cost of sales. On a dollar basis, cost of sales included increases from acquired businesses of approximately $52.1 million. Approximately $33.2 million of the cost of sales increase was predominantly attributable to organic growth in the volume of completed jobs in the residential new construction end market. Additionally, cost of sales increased $22.2 million as a result of a variety of factors including customer and product mix, market pricing variations and insulation volumes driven by building code requirements. None of these additional factors was more significant than any other.

Gross Profit

For the nine months ended September 30, 2016, gross profit increased $50.3 million to $184.1 million from $133.8 million for the nine months ended September 30, 2015. As a percentage of net revenue, gross profit increased to 29.3% for the nine months ended September 30, 2016 from 28.4% for the nine months ended September 30, 2015 primarily due to a favorable change in our customer and product mix, market pricing variations and insulation volumes, better fuel utilization and leverage of other items included in costs of sales.

Operating expenses

Selling

For the nine months ended September 30, 2016, selling expenses increased $8.9 million, or 32.9%, to $36.2 million from $27.3 million for the nine months ended September 30, 2015. As a percentage of net revenue, selling expenses were flat, remaining at 5.8% for the nine months ended September 30, 2016 and September 30, 2015. On a dollar basis, the increase in selling expenses was primarily due to higher wages, benefits and commissions of $7.8 million as well as higher advertising costs of $0.6 million which supported both organic and acquisition-related growth.

Administrative

For the nine months ended September 30, 2016, administrative expenses increased $20.1 million, or 27.6%, to $92.7 million from $72.6 million for the nine months ended September 30, 2015. The increase in administrative expenses generally related to the cost of completing acquisitions, the ongoing costs associated with these newly-acquired entities and costs to support our growth. Wages and benefits increased $12.1 million, of which $5.1 million was attributable to acquisitions and $7.0 million was to support our organic growth. In addition, facility costs increased $2.3 million, of which $1.6 million was due to acquisitions. The remaining increase in administrative expenses of $5.7 million included individually minor increases in several categories necessary to support our growing business.

Amortization

For the nine months ended September 30, 2016, amortization expense increased $4.1 million to $8.2 million from $4.1 million for the nine months ended September 30, 2015. The increase in amortization expense was attributable to the increase in finite-lived intangible assets obtained as a result of acquisitions.

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Other expense

For the nine months ended September 30, 2016, other expense increased $1.9 million to $4.9 million from $3.0 million for the nine months ended September 30, 2015 due to increased interest expense on higher debt levels to support our growth related to acquisitions.

Income tax provision

During the nine months ended September 30, 2016, we recorded an income tax provision of approximately $14.8 million on our income from continuing operations before income taxes of approximately $42.1 million, or an effective tax rate of 35.1%. This rate was favorably impacted by deductions related to domestic production activities, the early adoption of ASU 2016-09, and the release of a valuation allowance due to utilization of net operating losses. The favorability was partially offset by separate tax filing entities in a loss position for which a full valuation allowance will be accounted for against the losses, causing no tax benefit to be recognized on the losses.

During the nine months ended September 30, 2015, we recorded an income tax provision of approximately $9.6 million on our income from continuing operations before income taxes of approximately $26.8 million or an effective tax rate of 35.8%. This rate was favorably impacted by deductions related to domestic production activities. The favorability was partially offset by separate tax filing entities in a loss position for which a full valuation allowance will be accounted for against the losses, causing no tax benefit to be recognized on the losses.

Liquidity and Capital Resources

Our primary capital requirements are to fund working capital needs, operating expenses, acquisitions and capital expenditures and meet required principal and interest payments. Our capital resources primarily consist of cash from operations and borrowings under our credit agreement and capital equipment leases and loans. In addition, our pending acquisition of Alpha for aggregate consideration of approximately $92.1 million, which includes $9.2 million by issuing 282,577 shares of the Company’s common stock with the remainder paid in cash, additional seller obligations totaling $1.9 million, additional consideration based on the attainment of certain financial performance metrics for the full year 2016, and customary adjustments for cash and net working capital, will require us to commit significant resources to the acquisition and ongoing support of Alpha’s business. We expect to fund this acquisition by drawing on our existing credit facilities.  

Since 2012, when housing completions began to increase meaningfully after a previous significant downturn in the residential construction industry, we have experienced improved profitability and liquidity and invested significantly in acquisitions, supported by our cash from operations and our credit agreement. Additionally, we have utilized capitalized leases and loans to finance the increase in the number of our vehicles and equipment.

We believe that our cash flows from operations, combined with our current cash levels and available borrowing capacity, will be adequate to support our ongoing operations and to fund our debt service requirements, capital expenditures, working capital and acquisitions for at least the next 12 months.

Credit and Security Agreement

On February 29, 2016, we entered into a Credit and Security Agreement (the “Credit and Security Agreement”) with the lenders named therein. The Credit and Security Agreement amended and restated our previous credit agreement the (“2015 Credit Agreement”), which was scheduled to mature in April 2020. We used a portion of the funds from the Credit and Security Agreement to pay off the outstanding balances under the 2015 Credit Agreement. The Credit and Security Agreement provides for a five-year senior secured credit facility in an aggregate principal amount of up to $325.0 million, consisting of a $100.0 million revolving line of credit (the “Revolving LOC”), a $100.0 million term loan (the “Term Loan”), and a delayed draw term loan facility (the “DDTL”) providing for up to $125.0 million in additional term loan draws during the first year of the Credit and Security Agreement. Under the Revolving LOC, up to an aggregate of $20.0 million is available to us for the issuance of letters of credit and up to an aggregate of $5.0 million is available to us for swing line loans. The Credit and Security Agreement also includes an accordion feature which allows us, at our option but subject to lender and certain other approvals, to add up to an aggregate of $75.0 million in principal amount of term loans or additional revolving credit commitments, subject to the same terms as the Revolving LOC and Term Loan.

The Term Loan amortizes in quarterly principal payments of $1.3 million through March 31, 2017 with $1.9 million being due quarterly from June 30, 2017 through March 31, 2019 then increasing to $2.5 million on June 30, 2019 and continuing quarterly through December 31, 2020. Draws under the DDTL convert to an amortizing term loan (the “DDTL Term Loan”) on the earlier of (1) the date the DDTL is fully drawn or (2) February 28, 2017, when it will begin to amortize in quarterly principal payments,

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beginning June 30, 2017, equal (on a percentage basis) to the then-current amortization rate on the Term Loan. Draws under the DDTL may be used only for acquisitions or major capital expenditures. In addition to scheduled amortization payments, if our leverage ratio for any fiscal year is greater than or equal to 3.00 to 1.00, we would be required to make additional payments on the Term Loan and DDTL Term Loan for such fiscal year in an amount of not less than 50% of our excess cash flow (as defined in the Credit and Security Agreement) for such fiscal year within 10 days of our delivery of the financial reports required under the Credit and Security Agreement. Any remaining unpaid balances on the Term Loan and the DDTL Term Loan are due on February 28, 2021 (the “Maturity Date”).

Loans under the Credit and Security Agreement bear interest at either the eurodollar rate (“LIBOR”) or the base rate (which approximates prime rate), at our election, plus a margin based on the type of rate applied and our leverage ratio. At December 31, 2015, the outstanding balances on the term loan and the delayed draw term loan under the 2015 Credit Agreement bore interest at 1-month LIBOR, including margin (1.95%), and the outstanding balances on the Term Loan and DDTL at September 30, 2016 bore interest at 1-month LIBOR, including margin (2.31%).  In addition to interest, we are required to pay commitment fees on the unused portion of the Revolving LOC. The commitment fee rate for the period from February 29, 2016 through August 31, 2016, was 22.5 basis points. The commitment fee rate, like the interest rate spreads, is subject to adjustment, with possible future commitment fees ranging from 20 to 30 basis points per annum. At September 30, 2016, our applicable commitment fee rate was 22.5 basis points.  We are also required to pay a ticking fee of 37.5 basis points per annum on the unused portion of the DDTL until it is fully drawn or February 28, 2017, whichever is earlier.

All of the obligations under the Credit and Security Agreement are guaranteed by our existing and future direct and indirect material domestic subsidiaries, other than Suburban Insulation, Inc. (the “Guarantors”). Subject to certain restrictions, all of our and each Guarantor’s obligations under the Credit and Security Agreement are secured by: (1) all of our and each Guarantor’s tangible and intangible personal property and real property, excluding those assets pledged under capital leases and capital equipment loans; (2) a pledge of, and first priority perfected lien on, 100% of the capital stock or other equity interests of our and each Guarantor’s domestic subsidiaries; and (3) a negative pledge on all of our and each Guarantor’s assets.

The Credit and Security Agreement contains covenants that require us to (1) maintain a fixed charge coverage ratio of not less than 1.10 to 1.0 and (2) maintain a leverage ratio of no greater than: (a) 3.50 to 1.00 through December 30, 2016; (b) 3.25 to 1.00 on December 31, 2016 through June 29, 2017; (c) 3.00 to 1.00 on June 30, 2017 through December 30, 2017; (d) 2.75 to 1.00 on December 31, 2017 through June 29, 2018; and (e) 2.50 to 1.00 on June 30, 2018 and thereafter.  The Credit and Security Agreement also contains various restrictive non-financial covenants and a provision that, upon an event of default (as defined by the Credit and Security Agreement), amounts outstanding under the Credit and Security Agreement would bear interest at the rate as determined above plus 2.0% per annum.

Vehicle and Equipment Notes

We have entered into a Master Loan and Security Agreement (“Master Loan and Security Agreement”), a Master Equipment Lease Agreement (“Master Equipment Agreement”) and one or more Master Loan Agreements (“Master Loan Agreements”) with various lenders to provide financing for the purpose of purchasing or leasing vehicles and equipment used in the normal course of business. Each financing arrangement under these agreements constitutes a separate note and obligation. Vehicles and equipment purchased or leased under each financing arrangement serve as collateral for the note applicable to such financing arrangement. Regular payments are due under each note for a period of typically 60 consecutive months after the incurrence of the obligation. The specific terms of each note are based on specific criteria, including the type of vehicle or equipment and the market interest rates at the time. No termination date applies to these agreements.

Total gross assets relating to our master loan and equipment agreements were $43.5 million and $25.4 million as of September 30, 2016 and December 31, 2015, respectively, none of which were fully depreciated as of September 30, 2016 or December 31, 2015, respectively. The net book value of assets under these agreements was $35.2 million and $22.4 million as of September 30, 2016 and December 31, 2015, respectively. Depreciation of assets held under these agreements is included within cost of sales on the Condensed Consolidated Statements of Operations.

Letters of Credit and Bonds

We use letters of credit to secure our performance under our general liability and workers’ compensation insurance programs. Our workers’ compensation insurance program is considered a high deductible program whereby we are responsible for the cost of claims under approximately $0.8 million. If we do not pay these claims, our workers’ compensation insurance carriers are required to make these payments to the claimants on our behalf. Our general liability insurance program is considered a high retention program whereby we are responsible for the cost of claims up to $2.0 million. If we do not pay these claims, our general liability insurance carrier is required to make these payments to the claimants on our behalf. As of September 30, 2016, we had $18.0 million of outstanding letters

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of credit and $0.3 million in cash securing our performance under these insurance programs. We occasionally use performance bonds to ensure completion of our work on certain larger customer contracts that can span multiple accounting periods. As of September 30, 2016, we had 17 performance bonds outstanding, totaling approximately $2.6 million. Performance bonds generally do not have stated expiration dates; rather, we are released from the bonds as the contractual performance is completed. As of September 30, 2016, we had 267 permit and license bonds outstanding, totaling approximately $4.8 million. Permit and license bonds are typically issued for one year and are required by certain municipalities when we obtain licenses and permits to perform work in their jurisdictions.

Historical cash flow information

Cash flow from operating activities

Net cash provided by operating activities of $54.6 million and $29.1 million for the nine months ended September 30, 2016 and 2015, respectively, consisted primarily of net income of $27.4 million and $17.2 million, respectively, adjusted for non-cash and certain other items. Included in the net cash provided in 2016 were non-cash adjustments for depreciation and amortization expense on our expanded base of property, plant and equipment to support our growth totaling $17.2 million as well as for amortization on our growing intangible asset base from acquisitions totaling $8.2 million. These increases were coupled with other changes in working capital, most notably $6.0 million of additional other liabilities primarily driven by higher accrued wages due to an increase in number of days in the pay cycle to accrue, a $4.7 million change in other assets due primarily to a reduction of various prepaid assets and other receivables and $3.9 million of additional accounts payable resulting from the increase in purchases to support our growth, offset by a reduction of cash of $17.9 million due to increased accounts receivable resulting from our growth. Included in the net cash provided in 2015 were non-cash adjustments for depreciation and amortization expense on our expanded base of property, plant and equipment to support our growth totaling $11.9 million as well as for amortization on our growing intangible asset base totaling $4.1 million. These increases were coupled with other changes in working capital, most notably a $5.8 million change in accounts payable resulting from an increase in purchases to support our growth as well as a $5.3 million change in other assets due primarily to a reduction of various prepaid assets and other receivables, offset by a reduction in cash of $16.4 million due to increased accounts receivable balances compared to the beginning of the period resulting from higher sales in the nine months ended September 30, 2015.

Cash flows from investing activities

Net cash used in investing activities was $55.1 million and $91.0 million for the nine months ended September 30, 2016 and 2015, respectively. In 2016, we made cash payments, net of cash acquired, of $36.4 million on business combinations and $19.2 million primarily to purchase fleet to support our growing business. In 2015, we made cash payments, net of cash acquired, of $71.0 million on business combinations and $20.0 million primarily to purchase fleet to support our growing business. See the following “Capital Expenditures” section for further discussion of the increase in cash paid for purchases of property, plant and equipment in 2015. See Item 1, Financial Statements, Note 10, Business Combinations, for further information on acquisitions.

Cash flows from financing activities

Net cash provided by financing activities was $12.7 million and $56.4 million for the nine months ended September 30, 2016 and 2015, respectively. Net cash provided in 2016 was primarily due to net proceeds of $11.9 million as a result of amending our credit agreement, resulting in increased borrowing capacity to support operations and continuing acquisitions and $16.3 million of proceeds from notes payable to finance our vehicle purchases. This increase in cash was offset by $6.6 million in principal payments on capital lease obligations, $1.2 million in costs related to amending our credit agreement, and $4.1 million in principal payments on other long term debt. Net cash provided in 2015 was primarily the result of amending our credit agreement, resulting in increased borrowing capacity to support operations and continuing acquisitions.  During the nine months ended September 30, 2015, our balance on the term loan under the 2015 Credit Agreement increased $25.3 million on a net basis and our balance on the delayed draw term loan under the 2015 Credit Agreement increased $35.0 million in support of those initiatives.  We also received proceeds from vehicle and equipment notes payable of $12.8 million to finance the expansion of our fleet, offset by $7.3 million in principal payments on capital lease obligations and $6.1 million paid to repurchase 315,000 shares of our common stock.

Capital expenditures

Capital expenditures vary depending on prevailing business factors, including current and anticipated market conditions. Total capital expenditures, including non-cash purchases on account, were $21.3 million and $20.0 million for the nine months ended September 30, 2016 and 2015, respectively, and primarily related to purchases of vehicles and various equipment to support our operations and increased net revenue. We finance a significant portion of our capital expenditures under the Master Loan and Security Agreement, the Master Equipment Agreement or the Master Loan Agreement, which allow us to benefit from depreciation for tax purposes. These arrangements require us to pay cash up front for vehicles and equipment. We are reimbursed for the upfront cash payments after the assets are financed under the agreements. Of the $21.3 million in capital expenditures during the nine months

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ended September 30, 2016, $16.3 million was converted to a financing arrangement by September 30, 2016 under the Master Loan and Security Agreement, Master Equipment Agreement and Master Loan Agreements.

Capped Call Agreement

Certain of our stockholders entered into a capped call agreement with the underwriters of the secondary offering of our common stock completed on June 17, 2014. This agreement provides that these stockholders have the option to call a total of approximately 1.1 million shares of our common stock at a capped price.  The option can be exercised within specific dates based on the then current price of the underlying shares and will be settled in cash. During the nine months ended September 30, 2016, approximately 0.7 million shares were exercised and approximately 0.4 million shares under the agreement remain available and become exercisable on various dates in June 2017. The capped call agreement is between the stockholders and the underwriters and does not represent compensation to the stockholders for services rendered to us. The price paid for the option represents the fair value of that transaction and we are not a party to the agreement. Accordingly, we have not recorded any expense related to this transaction.

Contractual Obligations

Our enforceable and legally binding obligations as of September 30, 2016, included in the table below are based on management’s estimates and assumptions about these obligations, including their duration, the possibility of renewal, anticipated actions by third parties and other factors. Because these estimates and assumptions are necessarily subjective, our actual payments may vary from those reflected in the table:

	Payments due by year (1)
(in thousands)	Total		Remainder of 2016		2017		2018		2019		2020		Thereafter
Long-term debt obligations (2)	$	162,162	$	4,122	$	19,400	$	19,650	$	21,283	$	20,424	$	77,283
Capital lease obligations (3)		18,336		2,428		7,471		4,698		3,104		635		—
Operating lease obligations (4)		25,584		2,505		8,380		5,027		3,458		2,766		3,448
Purchase obligations (5)		15,826		15,826		—		—		—		—		—

(1) Our unrecognized tax benefits under ASC 740, “Income Taxes,” have been excluded from the table because of the inherent uncertainty and the inability to reasonably estimate the timing of cash outflows.

(2) Long-term debt obligations include principal and interest payments on our Term Loan and DDTL under the Credit and Security Agreement as well as our notes payable to sellers of acquisitions and vehicles purchased under the Master Loan and Security Agreement, the Master Equipment Agreement, and the Master Loan Agreements. Long-term debt obligations do not include commitment fees on the unused portion of the Revolving LOC or a ticking fee on the unused portion of the DDTL since those fees are subject to change based on the factors described in our Credit and Security Agreement. See Item 1, Financial Statements, Note 4, Long-Term Debt, for information on our Credit and Security Agreement. Interest on seller obligations maturing through March 2025 is estimated using current market rates. See Item 1, Financial Statements, Note 4, Long-Term Debt, for information on our Vehicle and Equipment Notes.

(3) We maintain certain production vehicles under a capital lease structure. The leases expire on various dates through November 2020. Capital lease obligations, as disclosed above, include estimated interest expense payments. In determining expected interest expense payments, we utilize the current market rate.

(4) We lease certain locations, vehicles and equipment under operating lease agreements, including, but not limited to, corporate offices, branch locations and various office and operating equipment. In some instances, these location lease agreements exist with related parties. See Note 8, Related Party Transactions, for further information.

(5) As of September 30, 2016, we had two product supply contracts, one extending through December 31, 2016 and one extending through August 31, 2017 which has been suspended through December 31, 2016. Our obligations for both contracts are based on quantity without a specific rate applied and therefore are not quantifiable. The amounts in the above table represent our best estimate as to the prices that will be payable for the minimum volume of purchases that must be made under the contract extending through December 31, 2016. Due to the suspension of the contract extending through August 31, 2017, we cannot estimate future payments under this contract at this time.

Off-Balance Sheet Arrangements

As of September 30, 2016, other than operating leases and purchase obligations described above, letters of credit issued under our revolving credit facility and performance and license bonds, we had no material off-balance sheet arrangements.

25

Critical Accounting Policies and Estimates

There have been no material changes for the three months ended September 30, 2016 from the critical accounting policies and estimates as previously disclosed in our 2015 Form 10-K.

Forward-Looking Statements

This report contains forward-looking statements within the meaning of the federal securities laws, including with respect to the closing of our pending acquisition of Alpha and the expected timing, the anticipated funding for this acquisition, the impact of pending Alpha acquisition on and its contribution to our operations and execution of our growth strategy, the impact of this pending acquisition on our earnings and revenue, the demand for our services, expansion of our national footprint, our ability to capitalize on the new home construction recovery, our ability to strengthen our market position, our ability to pursue value-enhancing acquisitions, our ability to improve profitability and expectations for future demand for our services for the remainder of 2016 and 2017. Forward-looking statements may generally be identified by the use of words such as “anticipate,” “believe,” “expect,” “intends,” “plan,” and “will” or, in each case, their negative, or other variations or comparable terminology. These forward-looking statements include all matters that are not historical facts. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. Any forward-looking statements that we make herein and in any future reports and statements are not guarantees of future performance, and actual results may differ materially from those expressed in or suggested by such forward-looking statements as a result of various factors, including, without limitation, legal or regulatory proceedings or other matters that affect the timing or ability to complete the Alpha acquisition as contemplated, the possibility that the Alpha acquisition will not close due to failure to satisfy the closing conditions, the occurrence of any event, change or circumstance that could give rise to the termination of the Alpha acquisition agreement, the potential impact to the Company’s or Alpha’s business due to the announcement of the acquisition, the risk that we may be unable to successfully integrate Alpha and realize the anticipated benefits of the acquisition, and the factors discussed in the “Risk Factors” section of our 2015 Form 10-K, as the same may be updated from time to time in our subsequent filings with the Securities and Exchange Commission. Any forward-looking statement made by the Company in this report speaks only as of the date hereof. New risks and uncertainties arise from time to time, and it is impossible for the Company to predict these events or how they may affect it. The Company has no obligation, and does not intend, to update any forward-looking statements after the date hereof, except as required by federal securities laws.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

There have been no material changes to our exposure to market risk since December 31, 2015.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We have evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report with the participation of our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”) as required by Exchange Act Rules 13a-15(e) and 15d-15(e).  Based on that evaluation, our CEO and CFO concluded that our disclosure controls and procedures were effective as of September 30, 2016.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting during the three months ended September 30, 2016 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

26

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

See Part I, Item 1. Financial Statements, Note 9, Commitments and Contingencies – Other Commitments and Contingencies, for information about existing legal proceedings.

Item 1A.  Risk Factors

There have been no material changes to our risk factors as disclosed in our 2015 Form 10-K other than the risk factor set forth in our Quarterly Report on Form 10-Q for the period ended June 30, 2016 and the risk factors set forth below relating to our pending acquisition of Alpha:

The acquisition of Alpha may not close within the expected time, or at all, which could adversely affect our stock price, future business and financial results.

We have entered into a share purchase agreement to acquire Alpha.  The acquisition is subject to a number of closing conditions, including expiration of the applicable waiting periods under the Hart-Scott-Rodino Act, as set forth in the share purchase agreement.  A number of conditions are not within our control, and we cannot assure that all of the conditions set forth in the share purchase agreement will be satisfied or waived or that this acquisition will be completed in the expected timeframe, or at all. The share purchase agreement may be terminated under certain circumstances, including if the acquisition is not consummated by February 25, 2017, subject to an extension for antitrust regulatory approval and certain other conditions.   If this acquisition is not consummated timely or at all, our stock price, future business and financial results could be adversely affected. In addition, if the acquisition is not consummated, we will have incurred significant acquisition-related expenses without realizing the expected benefits.

We may be unable to successfully integrate Alpha and realize the anticipated benefits of the acquisition.

Our pending acquisition of Alpha, if completed, will be our largest acquisition to date.  The anticipated benefits we expect from this acquisition are, necessarily, based on estimates and assumptions about the combined businesses, which may not materialize as we expect or which may prove to be inaccurate. The value of our common stock following the completion of the acquisition could be adversely affected if we are unable to realize the expected benefits from the acquisition on a timely basis or at all. Our performance after consummating the acquisition, will depend, in part, on our ability to integrate Alpha successfully and efficiently with our business. In addition, as we work to integrate Alpha into our business, we may face unexpected operational, strategic, financial or administrative challenges.

The risks and uncertainties involved with this acquisition and the integration include the following:

• our inability to manage the acquired business or control and estimate integration costs and other acquisition costs;

• failure to successfully manage our increased business in the commercial construction end market;

• potential adverse short-term effects on operating results from increased costs;

• diversion of the attention of  management and key employees;

• difficulties incorporating the acquired business into our existing internal control over financial reporting due to material weaknesses and significant deficiencies recently identified in the acquired business’s internal control over financial reporting;

• discovery of material misstatements in the historical financial statements of the acquired business resulting from material weaknesses and/or significant deficiencies in its internal control over financial reporting;

• loss of employees, suppliers, customers or other significant business partners as well as business disruption;

• failure to retain existing key personnel of the acquired business and recruit qualified new employees;

• failure to successfully implement infrastructure, logistics and systems integration;

• potential impairment of goodwill and other intangible assets;

27

• exposure to legal claims for activities of the acquired business prior to acquisition and an inability to realize on any indemnification claims, including with respect to tax, environmental and employee-related claims;

• the risks inherent in the systems of the acquired business and the risks associated with unexpected events or liabilities; and

• an increase in our financing costs as a result of higher indebtedness.

If we do not successfully manage these risks and the other challenges associated with the integration, we may not achieve the anticipated benefits of this acquisition and our business, revenue, expenses, operating results, cash flows and financial condition could be adversely affected.

As a result of the Alpha acquisition, our revenues derived from the commercial construction end market will increase and we may face new or unexpected challenges, which could adversely affect our margins, financial condition, operating results and cash flows.

After we complete the pending acquisition of Alpha, our revenues derived from the commercial construction end market will significantly increase on an absolute basis and as a percentage of our total revenues.  As we expand our commercial construction end market business, we may face new or unexpected competitive, operational, financial and accounting challenges and other risks that differ from our current business and existing operations. For example, the typical contractual terms and arrangements and billing cycle for the commercial construction end market are different than the residential new construction end market. The commercial construction end market also requires higher levels of performance bonding and there is no assurance that we will be able to obtain and maintain sufficient bonding capacity. These factors and any other challenges we encounter could adversely affect our margins, financial condition, operating results and cash flows.  

The amount of our goodwill and other intangible assets will significantly increase as a result of our acquisition of Alpha.   If our goodwill and other intangible assets become impaired in the future, we may be required to take significant non-cash impairment charges, which would negatively affect our earnings and reduce stockholders’ equity.  

As of September 30, 2016, we had goodwill and other intangible assets in an aggregate amount of $182.9 million, or approximately 41.4% of our total assets and 128.4% of our stockholders’ equity.  The acquisition of Alpha would result in a significant increase in our goodwill and other intangible assets.We review our goodwill and other intangible assets for impairment annually during the fourth quarter and when events or changes in circumstances indicate the carrying value may not be recoverable.  A significant decrease in our estimates for income and cash flows or a decline in our market capitalization could result in an impairment of our goodwill and/or other intangible assets.  Given the significant increase in the expected amount of our goodwill and other intangible assets after completion of the Alpha acquisition, any future impairment of these assets could require us to record material charges that would negatively impact our earnings and reduce stockholders’ equity.  

Our indebtedness will increase following the completion of the acquisition of Alpha, which could adversely affect us.

Following the completion of the pending acquisition of Alpha, our indebtedness will be higher than our current indebtedness.  This increase in the amount of our outstanding debt could adversely affect us by raising our borrowing costs.  In addition, our higher debt level could have other negative consequences, including making it more difficult for us to execute our growth strategy and reducing our liquidity and flexibility in planning for or reacting to changes or downturns in our business, industry and markets.  

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3.  Defaults Upon Senior Securities

There have been no material defaults in senior securities.

Item 4.  Mine Safety Disclosures

Not applicable.

28

Item 5.  Other Information

On November 1, 2016, the Compensation Committee of our Board of Directors approved Amendment No. 1 to Employment Agreement of Jeffrey W. Edwards, our Chief Executive Officer and President, dated November 1, 2013.  The amendment extends the “expiration date” (as defined in the employment agreement) from November 1, 2016 to November 1, 2019.  In addition, the amendment changes the required advance notice period for voluntary resignation without “good reason” (as defined in the employment agreement) from 30 days to 90 days.  All other terms of the employment agreement remain in effect.

Item 6.  Exhibits

(a)(3) Exhibits

The Exhibits listed on the accompanying Index to Exhibits are filed as part of this Quarterly Report on Form 10-Q.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: November 7, 2016

INSTALLED BUILDING PRODUCTS, INC.
By:	/s/ Jeffrey W. Edwards
	Jeffrey W. Edwards
	President and Chief Executive Officer
By:	/s/ Michael T. Miller
	Michael T. Miller
	Executive Vice President and Chief Financial Officer

29

INDEX TO EXHIBITS

Filed or Furnished with this Quarterly Report on Form 10-Q for the three months ended September 30, 2016

Exhibit		Incorporation by Reference				Filed or Furnished
Number	Description	Form	File No.	Exhibit(s)	Filing Date	Herewith
2.1	Share Purchase Agreement, dated as of October 29, 2016, among EMPER Holdings, LLC; PREEM Holdings I, LLC; PREEM Holdings II, LLC; Vikas Verma; Henry Schmueckle; Vikas Verma in his capacity as the equityholders’ representative; and Installed Building Products, Inc.†	8-K	001-36307	2.1	10/31/16
31.1	CEO Certification pursuant to Exchange Act Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002					X
31.2	CFO Certification pursuant to Exchange Act Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002					X
32.1	CEO Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002					X
32.2	CFO Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002					X
101 (a)	Financial statements in XBRL Format					X

† Schedules and Exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K.  The Company agrees to furnish supplemental copies of any of the omitted schedules to the Securities and Exchange Commission upon request.

30

EX-31.1

Exhibit 31.1

INSTALLED BUILDING PRODUCTS, INC.

Certification Required by Rule 13a-14(a) or 15d-14(a)

of the Securities Exchange Act of 1934

I, Jeffrey W. Edwards, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Installed Building Products, Inc. (the Registrant);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 7, 2016	By:	/s/ Jeffrey W. Edwards
		Jeffrey W. Edwards
		President and Chief Executive Officer

EX-31.2

Exhibit 31.2

INSTALLED BUILDING PRODUCTS, INC.

Certification Required by Rule 13a-14(a) or 15d-14(a)

of the Securities Exchange Act of 1934

I, Michael T. Miller, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Installed Building Products, Inc. (the Registrant);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 7, 2016	By:	/s/ Michael T. Miller
		Michael T. Miller
		Executive Vice President and Chief Financial Officer

EX-32.1

Exhibit 32.1

INSTALLED BUILDING PRODUCTS, INC.

Certification Required by Rule 13a-14(b) or 15d-14(b)

of the Securities Exchange Act of 1934 and

Section 1350 of Chapter 63 of Title 18 of the

United States Code

The certification set forth below is being submitted in connection with the Installed Building Products, Inc. Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2016 (the “Report”) for the purpose of complying with Rule 13a-14(b) or Rule 15d-14(b) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Section 1350 of Chapter 63 of Title 18 of the United States Code.

Jeffrey W. Edwards, the President and Chief Executive Officer, of Installed Building Products, Inc., certifies that, to the best of his knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the consolidated financial condition and results of operations of Installed Building Products, Inc.

Dated:  November 7, 2016	By:	/s/ Jeffrey W. Edwards
		Jeffrey W. Edwards
		President and Chief Executive Officer

EX-32.2

Exhibit 32.2

INSTALLED BUILDING PRODUCTS, INC.

Certification Required by Rule 13a-14(b) or 15d-14(b)

of the Securities Exchange Act of 1934 and

Section 1350 of Chapter 63 of Title 18 of the

United States Code

The certification set forth below is being submitted in connection with the Installed Building Products, Inc. Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2016 (the “Report”) for the purpose of complying with Rule 13a-14(b) or Rule 15d-14(b) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Section 1350 of Chapter 63 of Title 18 of the United States Code.

Michael T. Miller, the Executive Vice President and Chief Financial Officer, of Installed Building Products, Inc., certifies that, to the best of his knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the consolidated financial condition and results of operations of Installed Building Products, Inc.

Dated:  November 7, 2016	By:	/s/ Michael T. Miller
		Michael T. Miller
		Executive Vice President and Chief Financial Officer

XML

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2016	Oct. 31, 2016
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2016
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	Q3
Trading Symbol	IBP
Entity Registrant Name	INSTALLED BUILDING PRODUCTS, INC.
Entity Central Index Key	0001580905
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		31,485,525

XML

Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Current assets
Cash	$ 19,050	$ 6,818
Accounts receivable (less allowance for doubtful accounts of $3,310 and $2,486 at September 30, 2016 and December 31, 2015, respectively)	125,058	103,198
Inventories	34,083	29,337
Other current assets	6,320	10,879
Total current assets	184,511	150,232
Property and equipment, net	65,930	57,592
Non-current assets
Goodwill	102,518	90,512
Intangibles, net	80,423	67,218
Other non-current assets	8,438	8,018
Total non-current assets	191,379	165,748
Total assets	441,820	373,572
Current liabilities
Current maturities of long-term debt	15,064	10,021
Current maturities of capital lease obligations	7,333	8,411
Accounts payable	60,007	50,867
Accrued compensation	17,464	14,488
Other current liabilities	20,206	13,635
Total current liabilities	120,074	97,422
Long-term debt	133,011	113,214
Capital lease obligations, less current maturities	9,215	12,031
Deferred income taxes	15,241	14,582
Other long-term liabilities	21,746	21,840
Total liabilities	299,287	259,089
Commitments and contingencies (Note 9)
Stockholders' equity
Preferred Stock; $0.01 par value: 5,000,000 authorized and 0 shares issued and outstanding at September 30, 2016 and December 31, 2015, respectively
Common Stock; $0.01 par value: 100,000,000 authorized, 32,135,176 and 31,982,888 issued and 31,485,525 and 31,366,328 shares outstanding at September 30, 2016 and December 31, 2015, respectively	321	320
Additional paid in capital	158,218	156,688
Accumulated deficit	(3,787)	(31,142)
Treasury Stock; at cost: 649,651 and 616,560 shares at September 30, 2016 and December 31, 2015, respectively	(12,219)	(11,383)
Total stockholders' equity	142,533	114,483
Total liabilities and stockholders' equity	$ 441,820	$ 373,572

XML

Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Statement Of Financial Position [Abstract]
Allowance for doubtful accounts	$ 3,310	$ 2,486
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	32,135,176	31,982,888
Common stock, shares outstanding	31,485,525	31,366,328
Treasury Stock	649,651	616,560

XML

Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Income Statement [Abstract]
Net revenue	$ 225,392	$ 181,579	$ 629,003	$ 471,220
Cost of sales	158,132	128,162	444,909	337,395
Gross profit	67,260	53,417	184,094	133,825
Operating expenses
Selling	13,028	10,282	36,239	27,275
Administrative	31,504	25,841	92,677	72,606
Amortization	2,889	1,817	8,178	4,091
Operating income	19,839	15,477	47,000	29,853
Other expense
Interest expense	1,544	989	4,605	2,654
Other	23	138	248	357
Non-operating (income) expense	1,567	1,127	4,853	3,011
Income before income taxes	18,272	14,350	42,147	26,842
Income tax provision	6,723	4,869	14,792	9,612
Net income attributable to common stockholders	$ 11,549	$ 9,481	$ 27,355	$ 17,230
Basic net income per share attributable to common stockholders	$ 0.37	$ 0.30	$ 0.87	$ 0.55
Diluted net income per share attributable to common stockholders	$ 0.37	$ 0.30	$ 0.87	$ 0.55
Weighted average shares outstanding:
Basic	31,323,600	31,237,275	31,294,596	31,318,682
Diluted	31,377,790	31,288,609	31,351,991	31,343,230

XML

Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) $ in Thousands	Total	Common Stock [Member]	Additional Paid In Capital [Member]	Accumulated Deficit [Member]	Treasury Stock [Member]
BALANCE at Dec. 31, 2014	$ 91,874	$ 319	$ 154,497	$ (57,659)	$ (5,283)
BALANCE, Shares at Dec. 31, 2014		31,839,087
BALANCE, Treasury Shares at Dec. 31, 2014					(300,000)
Net income	17,230			17,230
Issuance of common stock awards to employees		$ 1	(1)
Issuance of common stock awards to employees, Shares		130,613
Surrender of common stock awards by employees, Shares					(1,560)
Share-based compensation expense	1,232		1,232
Share-based compensation issued to Directors, Value	300		300
Share-based compensation issued to Directors, Shares		13,188
Tax benefit from stock plans	76		76
Common stock repurchase, Value	(6,100)				$ (6,100)
Common stock repurchase, Shares					(315,000)
BALANCE at Sep. 30, 2015	104,612	$ 320	156,104	(40,429)	$ (11,383)
BALANCE, Shares at Sep. 30, 2015		31,982,888
BALANCE, Treasury Shares at Sep. 30, 2015					(616,560)
BALANCE at Dec. 31, 2015	$ 114,483	$ 320	156,688	(31,142)	$ (11,383)
BALANCE, Shares at Dec. 31, 2015	31,982,888	31,982,888
BALANCE, Treasury Shares at Dec. 31, 2015	(616,560)				(616,560)
Net income	$ 27,355			27,355
Issuance of common stock awards to employees		$ 1	(1)
Issuance of common stock awards to employees, Shares		143,528
Surrender of common stock awards by employees, Value	(836)				$ (836)
Surrender of common stock awards by employees, Shares					(33,091)
Share-based compensation expense	1,231		1,231
Share-based compensation issued to Directors, Value	300		300
Share-based compensation issued to Directors, Shares		8,760
BALANCE at Sep. 30, 2016	$ 142,533	$ 321	$ 158,218	$ (3,787)	$ (12,219)
BALANCE, Shares at Sep. 30, 2016	32,135,176	32,135,176
BALANCE, Treasury Shares at Sep. 30, 2016	(649,651)				(649,651)

XML

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Cash flows from operating activities
Net income	$ 27,355	$ 17,230
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization of property and equipment	17,240	11,872
Amortization of intangibles	8,178	4,091
Amortization of deferred financing costs and debt discount	282	199
Provision for doubtful accounts	1,960	1,551
Write-off of debt issuance costs	286
Gain on sale of property and equipment	(218)	(247)
Noncash stock compensation	1,531	1,532
Deferred income taxes	708	107
Changes in assets and liabilities, excluding effects of acquisitions
Accounts receivable	(17,878)	(16,405)
Inventories	(3,158)	(2,960)
Other assets	4,727	5,265
Accounts payable	3,879	5,777
Income taxes payable	3,652	1,918
Other liabilities	6,033	(819)
Net cash provided by operating activities	54,577	29,111
Cash flows from investing activities
Purchases of property and equipment	(19,169)	(19,959)
Acquisitions of businesses, net of cash acquired of $0 and $924, respectively	(36,427)	(71,040)
Proceeds from sale of property and equipment	523	448
Other		(420)
Net cash used in investing activities	(55,073)	(90,971)
Cash flows from financing activities
Proceeds from revolving line of credit under credit agreement applicable to respective period (Note 4)	37,975	130,800
Payments on revolving line of credit under credit agreement applicable to respective period (Note 4)	(37,975)	(130,800)
Proceeds from term loan under credit agreement applicable to respective period (Note 4)	100,000	50,000
Payments on term loan under credit agreement applicable to respective period (Note 4)	(50,625)	(24,688)
Proceeds from delayed draw term loan under credit agreement applicable to respective period (Note 4)	12,500	35,000
Payments on delayed draw term loan under credit agreement applicable to respective period (Note 4)	(50,000)
Proceeds from vehicle and equipment notes payable	16,310	12,817
Debt issuance costs	(1,238)	(758)
Principal payments on long term debt	(4,055)	(2,631)
Principal payments on capital lease obligations	(6,596)	(7,276)
Acquisition-related obligations	(2,732)
Repurchase of common stock		(6,100)
Surrender of common stock by employees	(836)
Net cash provided by financing activities	12,728	56,364
Net change in cash	12,232	(5,496)
Cash at beginning of period	6,818	10,761
Cash at end of period	19,050	5,265
Supplemental disclosures of cash flow information Net cash paid during the period for:
Interest	3,904	2,171
Income taxes, net of refunds	10,428	8,327
Supplemental disclosure of noncash investing and financing activities
Vehicles capitalized under capital leases and related lease obligations	2,956	2,750
Seller obligations in connection with acquisition of businesses	2,849	$ 12,364
Unpaid purchases of property and equipment included in accounts payable	$ 2,140

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Condensed Consolidated Statements of Cash Flows (Unaudited) (Parenthetical) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Statement Of Cash Flows [Abstract]
Cash acquired, Net	$ 0	$ 924

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Organization

9 Months Ended

Sep. 30, 2016

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Organization

NOTE 1 – ORGANIZATION

Installed Building Products, Inc. (“IBP”), a Delaware corporation formed on October 28, 2011, and its subsidiaries (collectively referred to as the “Company” and “we”, “us” and “our”) primarily install insulation, garage doors, rain gutters, shower doors, closet shelving and mirrors, and other products for residential and commercial builders located in the continental United States. IBP operates in over 100 locations within the continental United States and its corporate office is located in Columbus, Ohio.

We have one operating segment and a single reportable segment. Substantially all of our sales come from service-based installation of various products in the residential new construction and repair and remodel and commercial construction end markets. Each of our branches has the capacity to serve all of our end markets. The following table sets forth the percentage of our net revenue by end market:

	Three months ended September 30,						Nine months ended September 30,
	2016			2015			2016			2015
Residential new construction and repair and remodel		89	%		89	%		88	%		89	%
Commercial construction		11	%		11	%		12	%		11	%
		100	%		100	%		100	%		100	%

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Significant Accounting Policies

9 Months Ended

Sep. 30, 2016

Accounting Policies [Abstract]

Significant Accounting Policies

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Principles of Consolidation

The accompanying condensed consolidated financial statements include all of our wholly owned subsidiaries and majority owned subsidiaries. The non-controlling interest relating to majority owned subsidiaries is not significant for presentation. All intercompany accounts and transactions have been eliminated.

The information furnished in the condensed consolidated financial statements includes normal recurring adjustments and reflects all adjustments which are, in the opinion of management, necessary for a fair presentation of the results of operations and statements of financial position for the interim periods presented. Certain information and footnote disclosures normally included in the consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the rules and regulations of the Securities and Exchange Commission (the “SEC”) have been condensed or omitted pursuant to such rules and regulations. We believe that the disclosures are adequate to prevent the information presented from being misleading when read in conjunction with our consolidated financial statements and the notes thereto included in Part II, Item 8, Financial Statements and Supplementary Data, of our Annual Report on Form 10-K for the fiscal year ended December 31, 2015 (the “2015 Form 10-K”), as filed with the SEC on March 9, 2016. The December 31, 2015 condensed consolidated balance sheet data was derived from the audited financial statements but does not include all disclosures required by U.S. GAAP.

Our interim operating results for the three and nine months ended September 30, 2016 are not necessarily indicative of the results to be expected in future operating quarters. See Part I, Item 1A. Risk Factors in our 2015 Form 10-K and Part II, Item 1A. Risk Factors in our Quarterly Reports on Form 10-Q for the periods ended June 30, 2016 and September 30, 2016 for additional information regarding risk factors that may impact our results.

Note 2 to the consolidated financial statements in our 2015 Form 10-K describes the significant accounting policies and estimates used in preparation of the consolidated financial statements. There have been no changes to our significant accounting policies or estimates during the three or nine months ended September 30, 2016.

Use of Estimates

Preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include the allowance for doubtful accounts, valuation allowance on deferred tax assets, valuation of the reporting unit, intangible assets and other long-lived assets, share-based compensation, reserves for general liability, and workers’ compensation and medical insurances. Management believes the accounting estimates are appropriate and reasonably determined; however, due to the inherent uncertainties in making these estimates, actual amounts could differ from such estimates.

Advertising Costs

Advertising costs are expensed as incurred. Advertising expense was approximately $0.8 million and $2.2 million for the three and nine months ended September 30, 2016, respectively, and $0.6 million and $1.6 million for the three and nine months ended September 30, 2015, respectively, and is included in selling expense on the Condensed Consolidated Statements of Operations.

Recently Adopted Accounting Pronouncements

In April 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2015-03, “Simplifying the Presentation of Debt Issuance Costs.” Under this ASU, we present debt issuance costs in the balance sheet as a reduction from the related debt liability rather than as an asset. Amortization of such costs will continue to be reported as interest expense. During the nine months ended September 30, 2016, we retrospectively adopted ASU 2015-03, which resulted in a reclassification of $0.5 million of debt issuance costs related to our long-term debt from other non-current assets to long-term debt as of December 31, 2015.

In April 2015, the FASB issued ASU 2015-05, “Intangibles–Goodwill and Other–Internal-Use Software (Subtopic 350-40): Customer's Accounting for Fees Paid in a Cloud Computing Arrangement.” This update provides criteria for customers in a cloud computing arrangement to determine whether the arrangement includes a license of software. We adopted this guidance effective January 1, 2016 and have determined this ASU did not have a material impact on our condensed consolidated financial statements. 

In August 2015, the FASB issued ASU 2015-15, “Imputation of Interest (Subtopic 835-30).” This ASU amends ASU 2015-03 regarding the presentation and subsequent measurement of debt issuance costs related to line of credit arrangements. Specifically, it provides guidance for deferring and presenting debt issuance costs as an asset and subsequently amortizing the deferred debt issuance costs ratably over the term of the line of credit arrangement, regardless of whether there are any outstanding borrowings on the line of credit arrangement. We adopted this guidance effective January 1, 2016 and have determined this ASU did not have a material impact on our condensed consolidated financial statements. After applying the new guidance, deferred debt issuance costs, net of accumulated amortization, were $1.3 million and $0.6 million as September 30, 2016 and December 31, 2015, respectively.

In September 2015, the FASB issued ASU 2015-16, “Business Combinations (Topic 805).” This ASU requires an acquirer to retrospectively adjust provisional amounts recognized in a business combination during the measurement period. To simplify the accounting for adjustments made to provisional amounts, the amendments in this update require that the acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amount is determined. The acquirer is required to also record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date. In addition, an entity is required to present separately on the face of the income statement or disclose in the notes to the financial statements the portion of the amount recorded in current period earnings by line item that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date. For public business entities, this update is effective for fiscal years beginning after December 15, 2015, including interim periods within those fiscal years. While previous adjustments to provisional amounts did not have a material impact on our condensed consolidated financial statements, it is possible that future adjustments made during measurement periods to recently acquired entities or entities acquired in the future could have a material impact on our condensed consolidated financial statements.

In March 2016, the FASB issued ASU No. 2016-09, “Compensation-Stock Compensation (Topic 718).” This update amends the accounting for forfeitures, employer tax withholding on share-based compensation and the financial statement presentation of excess tax benefits or deficiencies. This ASU also clarifies the statement of cash flows presentation for certain components of share-based awards. As early adoption is permitted, we adopted this standard effective January 1, 2016 and have concluded that it did not have a material impact on our condensed consolidated financial statements. Under ASU 2016-09, we classify the excess income tax benefits from stock-based compensation arrangements as a discrete item within income tax expense, rather than recognizing such excess income tax benefits in additional paid-in capital. Excess income tax benefits from stock-based compensation arrangements are classified as an operating activity rather than as a financing activity. In addition, when we withhold shares from an employee’s vesting of common stock awards to fund payment by us of the employee’s taxes, the payment is classified as a financing activity. We have elected to continue to estimate the forfeitures expected to occur to determine the amount of compensation cost to be recognized in each period.

Recently Issued Accounting Pronouncements Not Yet Adopted

In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606).” ASU 2014-09 sets forth a new revenue recognition model that requires identifying the contract(s) with a customer, identifying the performance obligations in the contract, determining the transaction price, allocating the transaction price to the performance obligations and recognizing the revenue upon satisfaction of performance obligations. In July 2015, the FASB voted to defer the application of the provisions of this standard for public companies until annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. We are still evaluating whether this ASU will have a material impact on our condensed consolidated financial statements.

In July 2015, the FASB issued ASU 2015-11, “Inventory (Topic 330).” This update requires an entity to measure inventory within the scope of the update at the lower of cost and net realizable value. For public business entities, this update is effective for financial statements issued for fiscal years beginning after December 15, 2016, and interim periods within those fiscal years. We are still evaluating whether this ASU will have a material impact on our condensed consolidated financial statements.

In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842).” This update amends the existing accounting standards for lease accounting, including requiring lessees to recognize most leases on their balance sheets and making targeted changes to lessor accounting. ASU 2016-02 requires a modified retrospective transition approach for all leases existing at, or entered into after, the date of initial application, with an option to use certain transition relief. For public business entities, this update is effective for annual reporting periods beginning after December 15, 2018, including interim periods within those fiscal years, and early adoption is permitted as of the standard’s issuance date. We are still evaluating whether this ASU will have a material impact on our condensed consolidated financial statements.

In March 2016, the FASB issued ASU 2016-06, “Derivatives and Hedging (Topic 815): Contingent Put and Call Options in Debt Instruments.” This ASU clarifies the requirement for assessing whether contingent call (put) options that can accelerate the payment of principal on debt instruments are clearly and closely related to their debt hosts. An entity performing the assessment under this amendment is required to assess the embedded call (put) options solely in accordance with the four-step decision sequence. Consequently, when a call (put) option is contingently exercisable, an entity does not have to assess whether the event that triggers the ability to exercise a call (put) option is related to interest rates or credit risks. For public business entities, this update is effective for financial statements issued for fiscal years beginning after December 15, 2016 and interim periods within those fiscal years. We are still evaluating whether this ASU will have a material impact on our condensed consolidated financial statements.

In April 2016, the FASB issued ASU No. 2016-10, “Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing,” which provides supplemental adoption guidance and clarification to ASU 2014-09. ASU 2016-10 must be adopted concurrently with the adoption of ASU 2014-09. We are still evaluating whether the future adoption of these pronouncements will have a material impact on our condensed consolidated financial statements.

In May 2016, the FASB issued ASU No. 2016-11, “Revenue Recognition (Topic 605) and Derivatives and Hedging (Topic 815): Rescission of SEC Guidance Because of Accounting Standards Updates 2014-09 and 2014-16 pursuant to Staff announcements at the March 3, 2016 EITF Meeting” This ASU rescinds from the FASB Accounting Standards Codification certain SEC paragraphs as a result of two SEC Staff Announcements at the March 3, 2016 meeting. For public entities, the amendments related to Topic 605 are effective for interim and annual reporting periods beginning after December 15, 2017 and amendments related to Topic 815 are effective for interim and annual reporting periods beginning after December 15, 2015. We are still evaluating whether the portion of this ASU related to Topic 605 will have a material impact on our condensed consolidated financial statements but have concluded that the portion of this ASU related to Topic 815 is not applicable and, therefore, did not have a material impact on our condensed consolidated financial statements.

In May 2016, the FASB issued ASU 2016-12, “Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients.” The amendments in this ASU provide additional clarification and implementation guidance on the previously issued ASU 2014-09. This ASU provides clarification to Topic 606 on how to assess collectability, present sales tax, treat noncash consideration, and account for completed and modified contracts at the time of transition. The amendment also clarifies that an entity retrospectively applying the guidance in Topic 606 is not required to disclose the effect of the accounting change in the period of adoption. The effective date and transition requirements for these amendments are the same as the effective date and transition requirements of ASU 2014-09, which is effective for fiscal years, and for interim periods within those years, beginning after December 15, 2017. We are still evaluating whether this ASU will have a material impact on our condensed consolidated financial statements.

In June 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” This ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. In addition, these amendments require the measurement of all expected credit losses for financial assets, including trade accounts receivable, held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. For public business entities, this update is effective for financial statements issued for fiscal years beginning after December 15, 2019 and interim periods within those fiscal years. We are still evaluating whether this ASU will have a material impact on our condensed consolidated financial statements.

In August 2016, the FASB issued ASU 2016-15, “Statement of Cash Flows: Clarification of Certain Cash Receipts and Cash Payments (Topic 230).” This ASU addresses the diversity in practice related to the classification of certain cash receipts and payments in the statement of cash flows by adding or clarifying guidance on eight specific cash flow issues. For public business entities, this update is effective for financial statements issued for fiscal years beginning after December 15, 2017 and interim periods within those fiscal years. We are still evaluating whether this ASU will have a material impact on our condensed consolidated financial statements.

In October 2016, the FASB issued ASU 2016-16, “Income Taxes (Topic 740): intra-entity transfers of assets other than inventory.” This ASU aligns the recognition of income tax consequences for intra-entity transfers of assets other than inventory with International Financial Reporting Standards (IFRS). For public business entities, this update is effective for financial statements issued for fiscal years beginning after December 15, 2017 and interim periods within those fiscal years. We are still evaluating whether this ASU will have a material impact on our condensed consolidated financial statements.

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Goodwill and Intangibles

9 Months Ended

Sep. 30, 2016

Goodwill And Intangible Assets Disclosure [Abstract]

Goodwill and Intangibles

NOTE 3 – GOODWILL AND INTANGIBLES

Goodwill

The change in carrying amount of goodwill was as follows (in thousands):

	Goodwill (Gross)		Accumulated Impairment Losses			Goodwill (Net)
January 1, 2016	$	160,516	$	(70,004	)	$	90,512
Business Combinations		12,006		—			12,006
September 30, 2016	$	172,522	$	(70,004	)	$	102,518

We test goodwill for impairment annually during the fourth quarter of our fiscal year or earlier if there is an impairment indicator.  No impairment was recognized during either of the nine month periods ended September 30, 2016 and 2015.

Intangibles, net

The following table provides the gross carrying amount and accumulated amortization for each major class of intangibles (in thousands):

	As of September 30, 2016						As of December 31, 2015
	Gross Carrying Amount		Accumulated Amortization		Net Book Value		Gross Carrying Amount		Accumulated Amortization		Net Book Value
Amortized intangibles:
Customer relationships	$	75,261	$	25,562	$	49,699	$	62,399	$	20,231	$	42,168
Covenants not-to-compete		8,143		2,003		6,140		5,729		847		4,882
Trademarks and tradenames		34,436		9,852		24,584		28,320		8,152		20,168
	$	117,840	$	37,417	$	80,423	$	96,448	$	29,230	$	67,218

The gross carrying amount of intangibles increased approximately $21.4 million during the nine months ended September 30, 2016 primarily due to business combinations. See Note 10, Business Combinations, for more information. Remaining estimated aggregate annual amortization expense is as follows (amounts, in thousands, are for the fiscal year ended):

Remainder of 2016	$	2,859
2017		11,045
2018		10,741
2019		10,229
2020		9,622
Thereafter		35,927

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Long-Term Debt

9 Months Ended

Sep. 30, 2016

Debt Disclosure [Abstract]

Long-Term Debt

NOTE 4 – LONG-TERM DEBT

Debt consisted of the following (in thousands):

	As of September 30,			As of  December 31,
	2016			2015
Term loans, as amended, net of unamortized debt discount    of $477 and $249, respectively	$	97,030		$	47,876
Delayed draw term loans, as amended, net of unamortized    debt discount of $50 and $261, respectively		12,443			49,739
Vehicle and equipment notes, maturing through September    2021; payable in various monthly installments, including    interest rates ranging from 2% to 4%		33,414			21,091
Various notes payable, maturing through March 2025;    payable in various monthly installments, including interest    rates ranging from 4% to 6%		5,188			4,529
		148,075			123,235
Less: current maturities		(15,064	)		(10,021	)
Long-term debt, less current maturities	$	133,011		$	113,214

On February 29, 2016, we entered into a Credit and Security Agreement (the “Credit and Security Agreement”) with the lenders named therein. The Credit and Security Agreement amended and restated our previous credit agreement (the “2015 Credit Agreement”), which was scheduled to mature in April 2020. We used a portion of the funds from the Credit and Security Agreement to pay off the outstanding balances under the 2015 Credit Agreement. The Credit and Security Agreement provides for a five-year senior secured credit facility in an aggregate principal amount of up to $325.0 million, consisting of a $100.0 million revolving line of credit (the “Revolving LOC”), a $100.0 million term loan (the “Term Loan”), and a delayed draw term loan facility (the “DDTL”) providing for up to $125.0 million in additional term loan draws during the first year of the Credit and Security Agreement. Under the Revolving LOC, up to an aggregate of $20.0 million is available to us for the issuance of letters of credit and up to an aggregate of $5.0 million is available to us for swing line loans. The Credit and Security Agreement also includes an accordion feature which allows us, at our option but subject to lender and certain other approvals, to add up to an aggregate of $75.0 million in principal amount of term loans or additional revolving credit commitments, subject to the same terms as the Revolving LOC and Term Loan. As of September 30, 2016, there were approximately $18.0 million in letters of credit issued and no borrowings outstanding under the Revolving LOC. All of the obligations under the Credit and Security Agreement are guaranteed by our material domestic subsidiaries, other than Suburban Insulation, Inc.

Loans under the Credit and Security Agreement bear interest at either the eurodollar rate (“LIBOR”) or the base rate (which approximates prime rate), at our election, plus a margin based on the type of rate applied and our leverage ratio. At December 31, 2015, the outstanding balances on the term loan and the delayed draw term loan under the 2015 Credit Agreement bore interest at 1-month LIBOR, including margin (1.95%), and the outstanding balances on the Term Loan and DDTL at September 30, 2016 bore interest at 1-month LIBOR, including margin (2.31%).  In addition to interest, we are required to pay commitment fees on the unused portion of the Revolving LOC. The commitment fee rate for the period from February 29, 2016 through August 31, 2016, was 22.5 basis points. The commitment fee rate, like the interest rate spreads, is subject to adjustment with possible future commitment fees ranging from 20 to 30 basis points per annum. At September 30, 2016, our applicable commitment fee rate was 22.5 basis points.  We are also required to pay a ticking fee of 37.5 basis points per annum on the unused portion of the DDTL until it is fully drawn or February 28, 2017, whichever is earlier. Any outstanding principal balances on the Term Loan and DDTL are due on February 28, 2021 (the “Maturity Date”).

The Credit and Security Agreement contains covenants that require us to (1) maintain a fixed charge coverage ratio of not less than 1.10 to 1.0 and (2) maintain a leverage ratio of no greater than: (a) 3.50 to 1.00 through December 30, 2016; (b) 3.25 to 1.00 on December 31, 2016 through June 29, 2017; (c) 3.00 to 1.00 on June 30, 2017 through December 30, 2017; (d) 2.75 to 1.00 on December 31, 2017 through June 29, 2018; and (e) 2.50 to 1.00 on June 30, 2018 and thereafter.  The Credit and Security Agreement also contains various restrictive non-financial covenants and a provision that, upon an event of default (as defined by the Credit and Security Agreement), amounts outstanding under the Credit and Security Agreement would bear interest at the rate as determined above plus 2.0% per annum.

Vehicle and Equipment Notes

We are party to a Master Loan and Security Agreement (“Master Loan and Security Agreement”), a Master Equipment Lease Agreement (“Master Equipment Agreement”) and one or more Master Loan Agreements (“Master Loan Agreements”) with various lenders to provide financing for the purpose of purchasing or leasing vehicles and equipment used in the normal course of business. Each financing arrangement under these agreements constitutes a separate note and obligation. Vehicles and equipment purchased or leased under each financing arrangement serve as collateral for the note applicable to such financing arrangement. Regular payments are due under each note for a period of typically 60 consecutive months after the incurrence of the obligation. The specific terms of each note are based on specific criteria, including the type of vehicle or equipment and the market interest rates at the time. No termination date applies to these agreements.

Total gross assets relating to our master loan and equipment agreements were $43.5 million and $25.4 million as of September 30, 2016 and December 31, 2015, respectively, none of which were fully depreciated as of September 30, 2016 or December 31, 2015, respectively. The net book value of assets under these agreements was $35.2 million and $22.4 million as of September 30, 2016 and December 31, 2015, respectively. Depreciation of assets held under these agreements is included within cost of sales on the Condensed Consolidated Statements of Operations.

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Fair Value Measurements

9 Months Ended

Sep. 30, 2016

Fair Value Disclosures [Abstract]

Fair Value Measurements

NOTE 5 – FAIR VALUE MEASUREMENTS

Fair Values

Fair value is the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.

Accounting Standards Codification (“ASC”) 820, “Fair Value Measurement,” establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value:

Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3: Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

Estimated Fair Value of Financial Instruments

Accounts receivable, accounts payable and accrued liabilities as of September 30, 2016 and December 31, 2015 approximate fair value due to the short-term maturities of these financial instruments. The carrying amounts of the long-term debt, including the Term Loan, DDTL and Revolving LOC, approximate fair value as of September 30, 2016 and December 31, 2015 due to the short term maturities of the underlying variable rate LIBOR agreements. The carrying amounts of the obligations associated with our vehicle and equipment notes approximate fair value as of September 30, 2016 and December 31, 2015 because the associated assets generate sufficient cash through operations to settle the obligations. All debt classifications represent Level 2 fair value measurements.

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Employee Benefits

9 Months Ended

Sep. 30, 2016

Postemployment Benefits [Abstract]

Employee Benefits

NOTE 6 – EMPLOYEE BENEFITS

Healthcare

Our healthcare benefit expense (net of employee contributions) for all plans was approximately $3.7 million and $3.0 million for the three months ended September 30, 2016 and 2015, respectively, and $11.4 million and $8.9 million for the nine months ended September 30, 2016 and 2015, respectively, and is included in administrative expenses on our Condensed Consolidated Statements of Operations. An accrual for estimated healthcare claims incurred but not reported (“IBNR”) is included within accrued compensation on the Condensed Consolidated Balance Sheets and was $1.6 million and $1.5 million as of September 30, 2016 and December 31, 2015, respectively.

Workers’ Compensation

Workers’ compensation expense totaled $3.4 million and $2.6 million for the three months ended September 30, 2016 and 2015, respectively, and $9.2 million and $6.6 million for the nine months ended September 30, 2016 and 2015, respectively, and is included in costs of sales on our Condensed Consolidated Statements of Operations. Workers’ compensation known claims and IBNR reserves included on the Condensed Consolidated Balance Sheets were as follows (in thousands):

	September 30,		December 31,
	2016		2015
Included in other current liabilities	$	4,033	$	3,263
Included in other long-term liabilities		7,503		7,132
	$	11,536	$	10,395

We also had an insurance receivable for claims that exceeded the stop loss limit included on the Condensed Consolidated Balance Sheets.  That receivable offsets an equal liability included within the reserve amounts noted above and was as follows (in thousands):

	September 30,		December 31,
	2016		2015
Included in other non-current assets	$	1,256	$	1,542

Share-Based Compensation

Directors

During the nine months ended September 30, 2016 and 2015, we granted approximately 9 thousand and 13 thousand shares of our common stock, respectively, under our 2014 Omnibus Incentive Plan to non-employee members of our Board of Directors. Accordingly, for the nine months ended September 30, 2016 and 2015, we recorded $0.3 million in compensation expense within administrative expenses on the Condensed Consolidated Statements of Operations. These shares effectively vested on the grant date since there is deemed to be no service period associated with these awards. The lack of a vesting or service period may not apply to any future share grants under our 2014 Omnibus Incentive Plan.

Employees

During the nine months ended September 30, 2016, we granted approximately 0.1 million shares of our common stock under our 2014 Omnibus Incentive Plan to our employees, which vest in three equal installments (rounded to the nearest whole share) on each of April 20, 2017, April 20, 2018 and April 20, 2019.

During the nine months ended September 30, 2016, our employees surrendered approximately 32 thousand shares of our common stock to satisfy tax withholding obligations arising in connection with the vesting of such common stock awards previously issued under our 2014 Omnibus Incentive Plan. Share-based compensation expense was $0.4 million and $1.2 million for the three and nine months ended September 30, 2016, respectively. We recognized excess tax benefits of approximately $0.3 million within administrative expenses on the Condensed Consolidated Statements of Operations for the nine months ended September 30, 2016. We did not recognize any such excess tax benefits in the three months ended September 30, 2016.

During the nine months ended September 30, 2015, we granted approximately 0.1 million shares of our common stock under our 2014 Omnibus Incentive Plan to our employees.  Shares issued to non-executive employees vested 100% between January 7, 2016 and March 31, 2016, and shares issued to certain officers vest(ed) in three equal installments (rounded to the nearest whole share) on each of March 31, 2016, March 31, 2017 and March 31, 2018.  Share-based compensation expense was $0.6 million and $1.2 million for the three and nine months ended September 30, 2015.

Nonvested common stock awards for employees as of December 31, 2015 and changes during the nine months ended September 30, 2016 were as follows:

	Common Stock Awards			Weighted Average Grant Date Fair Market Value Per Share
Nonvested common stock awards at December 31, 2015		129,053		$	21.52
Granted		143,528			26.98
Vested		(109,473	)		21.48
Forfeited		(1,183	)		24.97
Nonvested common stock awards at September 30, 2016		161,925		$	26.37

As of September 30, 2016, there was $3.4 million of unrecognized compensation expense related to nonvested common stock awards. This expense is subject to future adjustments for forfeitures and is expected to be recognized on a straight-line basis over the remaining weighted-average period of 2.5 years. Shares forfeited are returned as treasury shares and available for future issuances.

As of September 30, 2016, approximately 2.7 million shares of common stock were available for issuance under the 2014 Omnibus Incentive Plan.

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Income Taxes

9 Months Ended

Sep. 30, 2016

Income Tax Disclosure [Abstract]

Income Taxes

NOTE 7 – INCOME TAXES

Our provision for income taxes as a percentage of pretax earnings (“effective tax rate”) is based on a current estimate of the annual effective income tax rate adjusted to reflect the impact of discrete items.

During the three and nine months ended September 30, 2016, the effective tax rate was 36.8 percent and 35.1 percent, respectively. These rates were favorably impacted by deductions related to domestic production activities, early adoption of ASU 2016-09 and the release of a valuation allowance due to utilization of net operating losses. The rates were partially offset by separate tax filing entities in a loss position for which a full valuation allowance will be accounted for against the losses, causing no tax benefit to be recognized on the losses.

On March 30, 2016, the FASB issued ASU 2016-09 which simplified several aspects of the accounting for employee share-based payment transactions. We decided to early adopt ASU 2016-09 and per its guidance recognized $0.3 million of excess income tax benefits from stock-based compensation arrangements as a discrete item within income tax expense for the nine months ended September 30, 2016. We did not recognize any excess income tax benefits related to the adoption of ASU 2016-09 during the three months ended September 30, 2016.

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Related Party Transactions

9 Months Ended

Sep. 30, 2016

Related Party Transactions [Abstract]

Related Party Transactions

NOTE 8 – RELATED PARTY TRANSACTIONS

We sell installation services to other companies related to us through common or affiliated ownership and/or Board of Directors and/or management relationships. We also purchase services and materials and pay rent to companies with common or related ownership.

We lease our headquarters and certain other facilities from related parties. See Note 9, Commitments and Contingencies, for future minimum lease payments to be paid to these related parties.

For the three and nine months ended September 30, 2016 and 2015, the amount of sales to related parties as well as the purchases from and rent expense paid to related parties were as follows (in thousands):

	Three months ended September 30,				Nine months ended September 30,
	2016		2015		2016		2015
Sales	$	2,182	$	1,924	$	5,282	$	4,661
Purchases		114		80		370		366
Rent		163		150		472		446

As of September 30, 2016 and December 31, 2015, we had related party balances of approximately $1.4 million and $1.8 million, respectively, included in accounts receivable on our Condensed Consolidated Balance Sheets. These balances represent trade accounts receivable arising during normal course of business with various related parties. M/I Homes, Inc., a customer whose Chairman, President and Chief Executive Officer is a member of our Board of Directors, accounted for $0.8 million and $1.0 million of these balances as of September 30, 2016 and December 31, 2015, respectively.

On March 13, 2015, we entered into a share repurchase agreement with Installed Building Systems, Inc. (“IBS”), a related party, for the purchase of approximately 0.3 million shares of our common stock for a purchase price of approximately $6.1 million (or $19.23 per share, which represented a 7.5% discount to the last reported price of our common stock on March 13, 2015).

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Commitments and Contingencies

9 Months Ended

Sep. 30, 2016

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

NOTE 9 – COMMITMENTS AND CONTINGENCIES

Accrued General Liability

Accrued general insurance reserves included on the Condensed Consolidated Balance Sheets were as follows (in thousands):

	September 30, 2016		December 31, 2015
Included in other current liabilities	$	1,667	$	1,304
Included in other long-term liabilities		8,514		6,879
	$	10,181	$	8,183

We also had general liability insurance receivables included on the Condensed Consolidated Balance Sheets that, in aggregate, offset an equal liability included within the reserve amounts noted above.  The amounts were as follows (in thousands):

	September 30, 2016		December 31, 2015
General liability insurance receivable and indemnification    asset for claims under a fully insured policy	$	2,815	$	2,815
General liability insurance receivable for claims that exceeded    the stop loss limit		907		821
Total general liability insurance receivables included in other    non-current assets	$	3,722	$	3,636

Leases

We are obligated under capital leases covering vehicles and certain equipment. The vehicle and equipment leases generally have terms ranging from four to six years. Total gross assets relating to capital leases were approximately $64.7 million and $64.9 million as of September 30, 2016 and December 31, 2015, respectively, and a total of approximately $23.1 million and $19.1 million were fully depreciated as of September 30, 2016 and December 31, 2015, respectively. The net book value of assets under capital leases was approximately $17.8 million and $22.1 million as of September 30, 2016 and December 31, 2015, respectively, net of accumulated depreciation of $46.9 million and $42.8 million as of September 30, 2016 and December 31, 2015, respectively. Amortization of assets held under capital leases is included within cost of sales on the Condensed Consolidated Statements of Operations.

We also have several noncancellable operating leases, primarily for buildings, improvements, equipment, and certain vehicles. These leases generally contain renewal options for periods ranging from one to five years and require us to pay all executory costs such as property taxes, maintenance and insurance.

In some instances, lease agreements exist with related parties. Future minimum lease payments under noncancellable operating leases (with initial or remaining lease terms in excess of one year) with related parties as of September 30, 2016 are as follows (amounts, in thousands, are as of the fiscal year ended):

Remainder of 2016	$	133
2017		366
2018		155
2019		—
2020		—
Thereafter		—

Supply Contract Commitments

As of September 30, 2016, we had two product supply contracts, one extending through December 31, 2016 and one extending through August 31, 2017. The contract extending through August 31, 2017 has been suspended through December 31, 2016. Our obligations for both contracts are based on quantity without a specific rate applied and therefore are not quantifiable. We expect our quantity of purchases to exceed the minimum quantity commitments for all years covered by the contracts. Actual purchases made under the contract extending through December 31, 2016 for the three months ended September 30, 2016 and 2015 were approximately $6.5 million and $16.6 million, respectively, and $32.9 million and $41.5 million for the nine months ended September 30, 2016 and 2015, respectively.

Other Commitments and Contingencies

From time to time, various claims and litigation are asserted or commenced against us principally arising from contractual and tort matters and personnel and employment disputes. In determining loss contingencies, management considers the likelihood of loss as well as the ability to reasonably estimate the amount of such loss or liability. An estimated loss is recorded when it is considered probable that such a liability has been incurred and when the amount of loss can be reasonably estimated. As litigation is subject to inherent uncertainties, we cannot be certain that we will prevail in these matters. However, we do not believe that the ultimate outcome of any pending matters will have a material adverse effect on our consolidated financial position, results of operations or cash flows.

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Business Combinations

9 Months Ended

Sep. 30, 2016

Business Combinations [Abstract]

Business Combinations

NOTE 10 – BUSINESS COMBINATIONS

As part of our ongoing strategy to increase market share in certain markets, we completed six business combinations during the nine months ended September 30, 2016 and five business combinations during the nine months ended September 30, 2015. The goodwill recognized in conjunction with these business combinations is attributable to expected improvement in the business of these acquired companies.  Approximately $12.8 million and $22.1 million of the goodwill from acquisitions completed during the nine months ended September 30, 2016 and 2015, respectively, is expected to be tax deductible.

2016

On January 25, 2016, we acquired substantially all of the assets of Key Green Builder Services, LLC d/b/a Key Insulation. The purchase price consisted of cash of $5.0 million and seller obligations of $0.7 million. Revenue and net loss since the date of acquisition included in our Condensed Consolidated Statements of Operations for the three months ended September 30, 2016 were $2.0 million and $0.2 million, respectively, and $6.3 million and $0.4 million, respectively, for the nine months ended September 30, 2016.

On February 2, 2016, we acquired substantially all of the assets of Marshall Insulation, LLC (“Marshall”).  The purchase price consisted of cash of $0.9 million and seller obligations of $0.1 million. Revenue and net loss since the date of acquisition included in our Condensed Consolidated Statements of Operations for the three months ended September 30, 2016 were $1.0 million and $54 thousand, respectively, and $2.5 million and $0.2 million, respectively, for the nine months ended September 30, 2016.

On February 29, 2016, we acquired substantially all of the assets of Kern Door Company, Inc. (“Kern”). The purchase price consisted of cash of $2.9 million and seller obligations of $0.1 million. Revenue and net loss since the date of acquisition included in our Condensed Consolidated Statements of Operations for the three months ended September 30, 2016 were $1.0 million and $62 thousand, respectively, and $2.0 million and $0.2 million, respectively, for the nine months ended September 30, 2016.

On April 12, 2016, we acquired substantially all of the assets of Alpine Insulation Co., Inc. (“Alpine”). The purchase price consisted of cash of $21.2 million and seller obligations of $1.6 million. Revenue and net income since the date of acquisition included in our Condensed Consolidated Statements of Operations for the three months ended September 30, 2016 were $7.9 million and $0.8 million, respectively, and $14.7 million and $1.2 million, respectively, for the nine months ended September 30, 2016.

On July 25, 2016, we acquired substantially all of the assets of FireClass, LLC (“FireClass”). The purchase price consisted of cash of $2.3 million. Revenue and net income since the date of acquisition included in our Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2016 were $0.8 million and $21 thousand, respectively.

On August 15, 2016, we acquired substantially all of the assets of Southern Insulators & Specialties, LLC (“Southern”). The purchase price consisted of cash of $4.1 million and seller obligations of $0.4 million. Revenue and net income since the date of acquisition included in our Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2016 were $0.7 million and $0.1 million, respectively.

2015

On March 12, 2015, we acquired 100% of the stock and membership interests of nine different legal entities, collectively referred to as BDI Insulation (“BDI”).  The purchase price consisted of cash of $30.7 million and seller obligations of $5.8 million. Revenue and net income since the date of acquisition included in our Condensed Consolidated Statements of Operations for the three months ended September 30, 2015 were $10.3 million and $0.6 million, respectively, and $22.5 million and $1.6 million, respectively, for the nine months ended September 30, 2015.

On April 6, 2015, we acquired 100% of the common stock of C.Q. Insulation Inc. (“CQ”). The purchase price consisted of cash of $5.2 million and seller obligations of $2.3 million. Revenue and net income since the date of acquisition included in our Condensed Consolidated Statements of Operations for the three months ended September 30, 2015 were $2.7 million and $0.3 million, respectively, and $5.4 million and $0.5 million, respectively, for the nine months ended September 30, 2015.

On June 1, 2015, we acquired substantially all of the assets of Layman Brothers Contracting (“Layman”). The purchase price consisted of cash of $9.1 million and seller obligations of $0.6 million. Revenue and net income since the date of acquisition included in our Condensed Consolidated Statements of Operations for the three months ended September 30, 2015 were $3.7 million and $0.3 million, respectively, and $4.9 million and $0.4 million, respectively, for the nine months ended September 30, 2015.

On July 1, 2015, we acquired substantially all of the assets of EcoLogic Energy Solutions (“EcoLogic”). The purchase price consisted of cash of $3.0 million and seller obligations of $0.5 million. Revenue and net income since the date of acquisition included in our Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2015 were $1.8 million and $36 thousand, respectively.

On August 10, 2015, we acquired 100% of the common stock of Eastern Contractor Services (“Eastern”). The purchase price consisted of cash of $24.2 million and seller obligations of $2.9 million. Revenue and net income since the date of acquisition included in our Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2015 were $3.0 million and $0.3 million, respectively.

Purchase Price Allocations

The estimated fair values of the assets acquired and liabilities assumed for the acquisitions, as well as total purchase prices and cash paid, approximated the following as of September 30, and as may be adjusted during the valuation period since acquisition (in thousands):

	2016									2015
	Alpine			Other			Total			BDI			CQ			Layman			Eastern			Other			Total
Estimated fair values:
Cash	$	—		$	—		$	—		$	661		$	100		$	-		$	165		$	—		$	926
Accounts receivable		3,959			2,031			5,990			4,735			1,423			1,245			2,768			1,049			11,220
Inventories		700			888			1,588			980			152			267			335			119			1,853
Other current assets		18			12			30			368			39			-			109			10			526
Property and equipment		656			1,187			1,843			1,006			190			733			1,364			406			3,699
Intangibles		12,800			8,492			21,292			21,280			4,350			5,330			13,871			1,827			46,658
Goodwill		6,624			5,368			11,992			16,213			3,035			3,143			9,904			875			33,170
Other non-current assets		—			70			70			3,736			—			—			322			56			4,114
Accounts payable and other current    liabilities		(2,046	)		(1,459	)		(3,505	)		(3,303	)		(1,539	)		(1,030	)		(1,681	)		(783	)		(8,336	)
Deferred income tax liabilities		—			(24	)		(24	)		(5,495	)		—			—			—			—			(5,495	)
Long term debt																				(82	)					(82	)
Other long-term liabilities		—			—			—			(3,736	)		(238	)		-			(1	)		—			(3,975	)
Fair value of assets acquired    and purchase price		22,711			16,565			39,276			36,445			7,512			9,688			27,074			3,559			84,278
Less seller obligations		1,560			1,289			2,849			5,765			2,319			600			2,875			544			12,103
Cash paid	$	21,151		$	15,276		$	36,427		$	30,680		$	5,193		$	9,088		$	24,199		$	3,015		$	72,175

Further adjustments to the allocation for each acquisition still under its measurement period are expected as third-party or internal valuations are finalized, certain tax aspects of the transaction are completed, and customary post-closing reviews are concluded during the measurement period attributable to each individual business combination. As a result, insignificant adjustments to the fair value of assets acquired, and in some cases total purchase price, have been made to certain business combinations since the date of acquisition and future adjustments may be made through the end of each measurement period. Goodwill and intangibles per the above table do not agree to the total gross increases of these assets as shown in Note 3—Goodwill and Intangibles during the nine months ended September 30, 2016 due to minor adjustments to goodwill for the allocation of certain acquisitions still under measurement as well as other immaterial intangible assets added during the ordinary course of business. In addition, goodwill and intangibles increased during the nine months ended September 30, 2015 due to an immaterial tuck-in acquisition that does not appear in the above table.

Included in other noncurrent assets in the above table as of September 30, 2016 and 2015 is an insurance receivable of $2.0 million and an indemnification asset associated with the acquisition of BDI in the amount of $1.6 million. These assets offset equal liabilities included in other long-term liabilities in the same table, which represent additional insurance reserves and an uncertain tax position liability for which we may be liable. All amounts are measured at their acquisition date fair value.

Estimates of acquired intangible assets related to the acquisitions are as follows (dollars in thousands):

	2016				2015
Acquired intangibles assets	Estimated Fair Value		Weighted Avg Estimated Useful Life (yrs)		Estimated Fair Value		Weighted Avg Estimated Useful Life (yrs)
Customer relationships	$	12,862		9	$	29,958		8
Trademarks and trade names		6,116		15		12,882		15
Non-competition agreements		2,314		5		3,818		5

Pro Forma Information

The unaudited pro forma information for the combined results of the Company has been prepared as if the 2016 acquisitions had taken place on January 1, 2015 and the 2015 acquisitions had taken place on January 1, 2014. The unaudited pro forma information is not necessarily indicative of the results that we would have achieved had the transactions actually taken place on January 1, 2015 and 2014, and the unaudited pro forma information does not purport to be indicative of future financial operating results.  See Note 12, Business Combinations, to our audited financial statements in Item 8 of Part II of our 2015 Form 10-K for additional information on 2015 acquisitions included in the table below (in thousands, except per share data):

	Pro forma for the three months ended September 30,				Pro forma for the nine months ended September 30,
	2016		2015		2016		2015
Net revenue	$	226,329	$	202,830	$	642,343	$	554,882
Net income attributable to common stockholders	$	11,709	$	10,211	$	27,387	$	19,353
Basic net income per share attributable to    common stockholders	$	0.37	$	0.33	$	0.88	$	0.62
Diluted net income per share attributable to    common stockholders	$	0.37	$	0.33	$	0.87	$	0.62

Unaudited pro forma net income attributable to common stockholders reflects additional intangible asset amortization expense of $37 thousand and $1.2 million for the three months ended September 30, 2016 and 2015, respectively, and $0.7 million and $4.9 million for the nine months ended September 30, 2016 and 2015, respectively, that would have been recorded had the 2016 acquisitions taken place on January 1, 2015 and the 2015 acquisitions taken place on January 1, 2014.  

Unaudited pro forma net income attributable to common stockholders also includes additional income tax expense of $0.1 million and $0.3 million for the three months ended September 30, 2016 and 2015, respectively, and $18 thousand and $1.2 million for the nine months ended September 30, 2016 and 2015, respectively, that would have been recorded had the 2016 acquisitions taken place on January 1, 2015 and the 2015 acquisitions taken place on January 1, 2014.

In addition, approximately $1.0 million in transaction costs incurred by a seller resulting from a business combination that occurred during the nine months ended September 30, 2015 were included in earnings reported for the nine months ended September 30, 2014 and, therefore, are not included in proforma net income reported in the table above.

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Income Per Common Share

9 Months Ended

Sep. 30, 2016

Earnings Per Share [Abstract]

Income Per Common Share

NOTE 11 –INCOME PER COMMON SHARE

Basic net income per share is calculated by dividing net income attributable to common stockholders by the weighted average shares outstanding during the period, without consideration for common stock equivalents.

Diluted net income per share is calculated by adjusting weighted average shares outstanding for the dilutive effect of common stock equivalents outstanding for the period, determined using the treasury stock method. Potential common stock is included in the diluted income per share calculation when dilutive. Diluted income per share was as follows (in thousands, except share and per share data):

	For the three months ended September 30,				For the nine months ended September 30,
	2016		2015		2016		2015
Net income attributable to common stockholders - basic    and diluted	$	11,549	$	9,481	$	27,355	$	17,230
Weighted average number of common shares outstanding		31,323,600		31,237,275		31,294,596		31,318,682
Dilutive effect of outstanding common stock awards    after application of the Treasury Stock Method		54,190		51,334		57,395		24,548
Diluted shares outstanding		31,377,790		31,288,609		31,351,991		31,343,230
Basic income per share attributable to common stockholders	$	0.37	$	0.30	$	0.87	$	0.55
Diluted income per share attributable to common    stockholders	$	0.37	$	0.30	$	0.87	$	0.55

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Subsequent Events

9 Months Ended

Sep. 30, 2016

Subsequent Events [Abstract]

Subsequent Events

NOTE 12 – SUBSEQUENT EVENTS

On October 17, 2016, we acquired substantially all of the assets of East Coast Insulators II, L.L.C. for total consideration of approximately $16.5 million, subject to a working capital adjustment. The initial accounting for the business combination was not complete at the time the financial statements were issued due to the timing of the acquisition and the filing of this Quarterly Report on Form 10-Q. As a result, disclosures required under ASC 805-10-50, Business Combinations, cannot be made at this time.

On October 29, 2016, we entered into a Share Purchase Agreement to acquire all of the outstanding shares of Trilok Industries, Inc.,the sole equityholder of Alpha Insulation and Waterproofing, Inc., and Alpha Insulation and Waterproofing Company (collectively “Alpha”) for aggregate consideration of approximately $92.1 million, which includes $9.2 million by issuing 282,577 shares of the Company’s common stock with the remainder paid in cash.  In addition, we will incur seller obligations totaling $1.9 million and the purchase price is subject to customary adjustments for cash and net working capital.  We will also pay in full certain indebtedness of Alpha.  Any payment for indebtedness in excess of approximately $0.4 million will reduce the amount of the purchase price by a corresponding amount.  We may also be required to pay an additional amount in cash as earnout consideration.  Consummation of the acquisition is subject to (i) customary closing conditions, including receipt of certain antitrust regulatory approvals, accuracy of representations (subject to materiality qualifiers) and compliance with covenants in all material respects; (ii) certain persons having agreed to employment offer letters and noncompetition agreements; (iii) certain individuals having agreed to release and waiver agreements and (iv) the receipt of certain documents with respect to leased properties.  We currently expect to fund and close this acquisition in the first quarter of 2017.  If the close does not occur by February 25, 2017, the parties can terminate the definitive purchase agreement, subject to an extension for antitrust regulatory approval and certain other conditions.

On November 1, 2016, we acquired substantially all of the assets of Mike’s Garage Door, L.L.C. for total consideration of approximately $0.6 million. The initial accounting for the business combination was not complete at the time the financial statements were issued due to the timing of the acquisition and the filing of this Quarterly Report on Form 10-Q. As a result, disclosures required under ASC 805-10-50, Business Combinations, cannot be made at this time.

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Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2016

Accounting Policies [Abstract]

Basis of Presentation and Principles of Consolidation

Basis of Presentation and Principles of Consolidation

The accompanying condensed consolidated financial statements include all of our wholly owned subsidiaries and majority owned subsidiaries. The non-controlling interest relating to majority owned subsidiaries is not significant for presentation. All intercompany accounts and transactions have been eliminated.

The information furnished in the condensed consolidated financial statements includes normal recurring adjustments and reflects all adjustments which are, in the opinion of management, necessary for a fair presentation of the results of operations and statements of financial position for the interim periods presented. Certain information and footnote disclosures normally included in the consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the rules and regulations of the Securities and Exchange Commission (the “SEC”) have been condensed or omitted pursuant to such rules and regulations. We believe that the disclosures are adequate to prevent the information presented from being misleading when read in conjunction with our consolidated financial statements and the notes thereto included in Part II, Item 8, Financial Statements and Supplementary Data, of our Annual Report on Form 10-K for the fiscal year ended December 31, 2015 (the “2015 Form 10-K”), as filed with the SEC on March 9, 2016. The December 31, 2015 condensed consolidated balance sheet data was derived from the audited financial statements but does not include all disclosures required by U.S. GAAP.

Our interim operating results for the three and nine months ended September 30, 2016 are not necessarily indicative of the results to be expected in future operating quarters. See Part I, Item 1A. Risk Factors in our 2015 Form 10-K and Part II, Item 1A. Risk Factors in our Quarterly Reports on Form 10-Q for the periods ended June 30, 2016 and September 30, 2016 for additional information regarding risk factors that may impact our results.

Note 2 to the consolidated financial statements in our 2015 Form 10-K describes the significant accounting policies and estimates used in preparation of the consolidated financial statements. There have been no changes to our significant accounting policies or estimates during the three or nine months ended September 30, 2016.

Use of Estimates

Use of Estimates

Preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include the allowance for doubtful accounts, valuation allowance on deferred tax assets, valuation of the reporting unit, intangible assets and other long-lived assets, share-based compensation, reserves for general liability, and workers’ compensation and medical insurances. Management believes the accounting estimates are appropriate and reasonably determined; however, due to the inherent uncertainties in making these estimates, actual amounts could differ from such estimates.

Advertising Costs

Advertising Costs

Advertising costs are expensed as incurred. Advertising expense was approximately $0.8 million and $2.2 million for the three and nine months ended September 30, 2016, respectively, and $0.6 million and $1.6 million for the three and nine months ended September 30, 2015, respectively, and is included in selling expense on the Condensed Consolidated Statements of Operations.

Recently Adopted Accounting Pronouncements

Recently Adopted Accounting Pronouncements

In April 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2015-03, “Simplifying the Presentation of Debt Issuance Costs.” Under this ASU, we present debt issuance costs in the balance sheet as a reduction from the related debt liability rather than as an asset. Amortization of such costs will continue to be reported as interest expense. During the nine months ended September 30, 2016, we retrospectively adopted ASU 2015-03, which resulted in a reclassification of $0.5 million of debt issuance costs related to our long-term debt from other non-current assets to long-term debt as of December 31, 2015.

In April 2015, the FASB issued ASU 2015-05, “Intangibles–Goodwill and Other–Internal-Use Software (Subtopic 350-40): Customer's Accounting for Fees Paid in a Cloud Computing Arrangement.” This update provides criteria for customers in a cloud computing arrangement to determine whether the arrangement includes a license of software. We adopted this guidance effective January 1, 2016 and have determined this ASU did not have a material impact on our condensed consolidated financial statements. 

In August 2015, the FASB issued ASU 2015-15, “Imputation of Interest (Subtopic 835-30).” This ASU amends ASU 2015-03 regarding the presentation and subsequent measurement of debt issuance costs related to line of credit arrangements. Specifically, it provides guidance for deferring and presenting debt issuance costs as an asset and subsequently amortizing the deferred debt issuance costs ratably over the term of the line of credit arrangement, regardless of whether there are any outstanding borrowings on the line of credit arrangement. We adopted this guidance effective January 1, 2016 and have determined this ASU did not have a material impact on our condensed consolidated financial statements. After applying the new guidance, deferred debt issuance costs, net of accumulated amortization, were $1.3 million and $0.6 million as September 30, 2016 and December 31, 2015, respectively.

In September 2015, the FASB issued ASU 2015-16, “Business Combinations (Topic 805).” This ASU requires an acquirer to retrospectively adjust provisional amounts recognized in a business combination during the measurement period. To simplify the accounting for adjustments made to provisional amounts, the amendments in this update require that the acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amount is determined. The acquirer is required to also record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date. In addition, an entity is required to present separately on the face of the income statement or disclose in the notes to the financial statements the portion of the amount recorded in current period earnings by line item that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date. For public business entities, this update is effective for fiscal years beginning after December 15, 2015, including interim periods within those fiscal years. While previous adjustments to provisional amounts did not have a material impact on our condensed consolidated financial statements, it is possible that future adjustments made during measurement periods to recently acquired entities or entities acquired in the future could have a material impact on our condensed consolidated financial statements.

In March 2016, the FASB issued ASU No. 2016-09, “Compensation-Stock Compensation (Topic 718).” This update amends the accounting for forfeitures, employer tax withholding on share-based compensation and the financial statement presentation of excess tax benefits or deficiencies. This ASU also clarifies the statement of cash flows presentation for certain components of share-based awards. As early adoption is permitted, we adopted this standard effective January 1, 2016 and have concluded that it did not have a material impact on our condensed consolidated financial statements. Under ASU 2016-09, we classify the excess income tax benefits from stock-based compensation arrangements as a discrete item within income tax expense, rather than recognizing such excess income tax benefits in additional paid-in capital. Excess income tax benefits from stock-based compensation arrangements are classified as an operating activity rather than as a financing activity. In addition, when we withhold shares from an employee’s vesting of common stock awards to fund payment by us of the employee’s taxes, the payment is classified as a financing activity. We have elected to continue to estimate the forfeitures expected to occur to determine the amount of compensation cost to be recognized in each period.

Recently Issued Accounting Pronouncements Not Yet Adopted

Recently Issued Accounting Pronouncements Not Yet Adopted

In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606).” ASU 2014-09 sets forth a new revenue recognition model that requires identifying the contract(s) with a customer, identifying the performance obligations in the contract, determining the transaction price, allocating the transaction price to the performance obligations and recognizing the revenue upon satisfaction of performance obligations. In July 2015, the FASB voted to defer the application of the provisions of this standard for public companies until annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. We are still evaluating whether this ASU will have a material impact on our condensed consolidated financial statements.

In July 2015, the FASB issued ASU 2015-11, “Inventory (Topic 330).” This update requires an entity to measure inventory within the scope of the update at the lower of cost and net realizable value. For public business entities, this update is effective for financial statements issued for fiscal years beginning after December 15, 2016, and interim periods within those fiscal years. We are still evaluating whether this ASU will have a material impact on our condensed consolidated financial statements.

In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842).” This update amends the existing accounting standards for lease accounting, including requiring lessees to recognize most leases on their balance sheets and making targeted changes to lessor accounting. ASU 2016-02 requires a modified retrospective transition approach for all leases existing at, or entered into after, the date of initial application, with an option to use certain transition relief. For public business entities, this update is effective for annual reporting periods beginning after December 15, 2018, including interim periods within those fiscal years, and early adoption is permitted as of the standard’s issuance date. We are still evaluating whether this ASU will have a material impact on our condensed consolidated financial statements.

In March 2016, the FASB issued ASU 2016-06, “Derivatives and Hedging (Topic 815): Contingent Put and Call Options in Debt Instruments.” This ASU clarifies the requirement for assessing whether contingent call (put) options that can accelerate the payment of principal on debt instruments are clearly and closely related to their debt hosts. An entity performing the assessment under this amendment is required to assess the embedded call (put) options solely in accordance with the four-step decision sequence. Consequently, when a call (put) option is contingently exercisable, an entity does not have to assess whether the event that triggers the ability to exercise a call (put) option is related to interest rates or credit risks. For public business entities, this update is effective for financial statements issued for fiscal years beginning after December 15, 2016 and interim periods within those fiscal years. We are still evaluating whether this ASU will have a material impact on our condensed consolidated financial statements.

In April 2016, the FASB issued ASU No. 2016-10, “Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing,” which provides supplemental adoption guidance and clarification to ASU 2014-09. ASU 2016-10 must be adopted concurrently with the adoption of ASU 2014-09. We are still evaluating whether the future adoption of these pronouncements will have a material impact on our condensed consolidated financial statements.

In May 2016, the FASB issued ASU No. 2016-11, “Revenue Recognition (Topic 605) and Derivatives and Hedging (Topic 815): Rescission of SEC Guidance Because of Accounting Standards Updates 2014-09 and 2014-16 pursuant to Staff announcements at the March 3, 2016 EITF Meeting” This ASU rescinds from the FASB Accounting Standards Codification certain SEC paragraphs as a result of two SEC Staff Announcements at the March 3, 2016 meeting. For public entities, the amendments related to Topic 605 are effective for interim and annual reporting periods beginning after December 15, 2017 and amendments related to Topic 815 are effective for interim and annual reporting periods beginning after December 15, 2015. We are still evaluating whether the portion of this ASU related to Topic 605 will have a material impact on our condensed consolidated financial statements but have concluded that the portion of this ASU related to Topic 815 is not applicable and, therefore, did not have a material impact on our condensed consolidated financial statements.

In May 2016, the FASB issued ASU 2016-12, “Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients.” The amendments in this ASU provide additional clarification and implementation guidance on the previously issued ASU 2014-09. This ASU provides clarification to Topic 606 on how to assess collectability, present sales tax, treat noncash consideration, and account for completed and modified contracts at the time of transition. The amendment also clarifies that an entity retrospectively applying the guidance in Topic 606 is not required to disclose the effect of the accounting change in the period of adoption. The effective date and transition requirements for these amendments are the same as the effective date and transition requirements of ASU 2014-09, which is effective for fiscal years, and for interim periods within those years, beginning after December 15, 2017. We are still evaluating whether this ASU will have a material impact on our condensed consolidated financial statements.

In June 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” This ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. In addition, these amendments require the measurement of all expected credit losses for financial assets, including trade accounts receivable, held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. For public business entities, this update is effective for financial statements issued for fiscal years beginning after December 15, 2019 and interim periods within those fiscal years. We are still evaluating whether this ASU will have a material impact on our condensed consolidated financial statements.

In August 2016, the FASB issued ASU 2016-15, “Statement of Cash Flows: Clarification of Certain Cash Receipts and Cash Payments (Topic 230).” This ASU addresses the diversity in practice related to the classification of certain cash receipts and payments in the statement of cash flows by adding or clarifying guidance on eight specific cash flow issues. For public business entities, this update is effective for financial statements issued for fiscal years beginning after December 15, 2017 and interim periods within those fiscal years. We are still evaluating whether this ASU will have a material impact on our condensed consolidated financial statements.

In October 2016, the FASB issued ASU 2016-16, “Income Taxes (Topic 740): intra-entity transfers of assets other than inventory.” This ASU aligns the recognition of income tax consequences for intra-entity transfers of assets other than inventory with International Financial Reporting Standards (IFRS). For public business entities, this update is effective for financial statements issued for fiscal years beginning after December 15, 2017 and interim periods within those fiscal years. We are still evaluating whether this ASU will have a material impact on our condensed consolidated financial statements.

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Organization (Tables)

9 Months Ended

Sep. 30, 2016

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Summary of Percentage of Net Revenue by End Market

The following table sets forth the percentage of our net revenue by end market:

	Three months ended September 30,						Nine months ended September 30,
	2016			2015			2016			2015
Residential new construction and repair and remodel		89	%		89	%		88	%		89	%
Commercial construction		11	%		11	%		12	%		11	%
		100	%		100	%		100	%		100	%

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Goodwill and Intangibles (Tables)

9 Months Ended

Sep. 30, 2016

Goodwill And Intangible Assets Disclosure [Abstract]

Summary of Change in Carrying Amount of Goodwill

The change in carrying amount of goodwill was as follows (in thousands):

	Goodwill (Gross)		Accumulated Impairment Losses			Goodwill (Net)
January 1, 2016	$	160,516	$	(70,004	)	$	90,512
Business Combinations		12,006		—			12,006
September 30, 2016	$	172,522	$	(70,004	)	$	102,518

Schedule of Gross Carrying Amount and Accumulated Amortization

The following table provides the gross carrying amount and accumulated amortization for each major class of intangibles (in thousands):

	As of September 30, 2016						As of December 31, 2015
	Gross Carrying Amount		Accumulated Amortization		Net Book Value		Gross Carrying Amount		Accumulated Amortization		Net Book Value
Amortized intangibles:
Customer relationships	$	75,261	$	25,562	$	49,699	$	62,399	$	20,231	$	42,168
Covenants not-to-compete		8,143		2,003		6,140		5,729		847		4,882
Trademarks and tradenames		34,436		9,852		24,584		28,320		8,152		20,168
	$	117,840	$	37,417	$	80,423	$	96,448	$	29,230	$	67,218

Schedule of Estimated Aggregate Annual Amortization

Remaining estimated aggregate annual amortization expense is as follows (amounts, in thousands, are for the fiscal year ended):

Remainder of 2016	$	2,859
2017		11,045
2018		10,741
2019		10,229
2020		9,622
Thereafter		35,927

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Long-Term Debt (Tables)

9 Months Ended

Sep. 30, 2016

Debt Disclosure [Abstract]

Schedule of Maturities of Long-term Debt

Debt consisted of the following (in thousands):

	As of September 30,			As of  December 31,
	2016			2015
Term loans, as amended, net of unamortized debt discount    of $477 and $249, respectively	$	97,030		$	47,876
Delayed draw term loans, as amended, net of unamortized    debt discount of $50 and $261, respectively		12,443			49,739
Vehicle and equipment notes, maturing through September    2021; payable in various monthly installments, including    interest rates ranging from 2% to 4%		33,414			21,091
Various notes payable, maturing through March 2025;    payable in various monthly installments, including interest    rates ranging from 4% to 6%		5,188			4,529
		148,075			123,235
Less: current maturities		(15,064	)		(10,021	)
Long-term debt, less current maturities	$	133,011		$	113,214

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Employee Benefits (Tables)

9 Months Ended

Sep. 30, 2016

Postemployment Benefits [Abstract]

Summary of Workers' Compensation Known Claims and IBNR Reserves

Workers’ compensation known claims and IBNR reserves included on the Condensed Consolidated Balance Sheets were as follows (in thousands):

	September 30,		December 31,
	2016		2015
Included in other current liabilities	$	4,033	$	3,263
Included in other long-term liabilities		7,503		7,132
	$	11,536	$	10,395

Schedule of Insurance Receivable for Claims

That receivable offsets an equal liability included within the reserve amounts noted above and was as follows (in thousands):

	September 30,		December 31,
	2016		2015
Included in other non-current assets	$	1,256	$	1,542

Summary of Nonvested Common Stock Awards and Changes During Period

Nonvested common stock awards for employees as of December 31, 2015 and changes during the nine months ended September 30, 2016 were as follows:

	Common Stock Awards			Weighted Average Grant Date Fair Market Value Per Share
Nonvested common stock awards at December 31, 2015		129,053		$	21.52
Granted		143,528			26.98
Vested		(109,473	)		21.48
Forfeited		(1,183	)		24.97
Nonvested common stock awards at September 30, 2016		161,925		$	26.37

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Related Party Transactions (Tables)

9 Months Ended

Sep. 30, 2016

Related Party Transactions [Abstract]

Schedule of Related Party Transactions

For the three and nine months ended September 30, 2016 and 2015, the amount of sales to related parties as well as the purchases from and rent expense paid to related parties were as follows (in thousands):

	Three months ended September 30,				Nine months ended September 30,
	2016		2015		2016		2015
Sales	$	2,182	$	1,924	$	5,282	$	4,661
Purchases		114		80		370		366
Rent		163		150		472		446

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Commitments and Contingencies (Tables)

9 Months Ended

Sep. 30, 2016

Commitments And Contingencies Disclosure [Abstract]

Schedule of Accrued General Insurance Reserves

Accrued general insurance reserves included on the Condensed Consolidated Balance Sheets were as follows (in thousands):

	September 30, 2016		December 31, 2015
Included in other current liabilities	$	1,667	$	1,304
Included in other long-term liabilities		8,514		6,879
	$	10,181	$	8,183

Schedule of General Liability Insurance Receivable for Claims

We also had general liability insurance receivables included on the Condensed Consolidated Balance Sheets that, in aggregate, offset an equal liability included within the reserve amounts noted above.  The amounts were as follows (in thousands):

	September 30, 2016		December 31, 2015
General liability insurance receivable and indemnification    asset for claims under a fully insured policy	$	2,815	$	2,815
General liability insurance receivable for claims that exceeded    the stop loss limit		907		821
Total general liability insurance receivables included in other    non-current assets	$	3,722	$	3,636

Future Minimum Lease Payments Under Noncancellable Operating Leases

Future minimum lease payments under noncancellable operating leases (with initial or remaining lease terms in excess of one year) with related parties as of September 30, 2016 are as follows (amounts, in thousands, are as of the fiscal year ended):

Remainder of 2016	$	133
2017		366
2018		155
2019		—
2020		—
Thereafter		—

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Business Combinations (Tables)

9 Months Ended

Sep. 30, 2016

Business Combinations [Abstract]

Summary of Estimated Fair Value of Assets Acquired and Liabilities Assumed

The estimated fair values of the assets acquired and liabilities assumed for the acquisitions, as well as total purchase prices and cash paid, approximated the following as of September 30, and as may be adjusted during the valuation period since acquisition (in thousands):

	2016									2015
	Alpine			Other			Total			BDI			CQ			Layman			Eastern			Other			Total
Estimated fair values:
Cash	$	—		$	—		$	—		$	661		$	100		$	-		$	165		$	—		$	926
Accounts receivable		3,959			2,031			5,990			4,735			1,423			1,245			2,768			1,049			11,220
Inventories		700			888			1,588			980			152			267			335			119			1,853
Other current assets		18			12			30			368			39			-			109			10			526
Property and equipment		656			1,187			1,843			1,006			190			733			1,364			406			3,699
Intangibles		12,800			8,492			21,292			21,280			4,350			5,330			13,871			1,827			46,658
Goodwill		6,624			5,368			11,992			16,213			3,035			3,143			9,904			875			33,170
Other non-current assets		—			70			70			3,736			—			—			322			56			4,114
Accounts payable and other current    liabilities		(2,046	)		(1,459	)		(3,505	)		(3,303	)		(1,539	)		(1,030	)		(1,681	)		(783	)		(8,336	)
Deferred income tax liabilities		—			(24	)		(24	)		(5,495	)		—			—			—			—			(5,495	)
Long term debt																				(82	)					(82	)
Other long-term liabilities		—			—			—			(3,736	)		(238	)		-			(1	)		—			(3,975	)
Fair value of assets acquired    and purchase price		22,711			16,565			39,276			36,445			7,512			9,688			27,074			3,559			84,278
Less seller obligations		1,560			1,289			2,849			5,765			2,319			600			2,875			544			12,103
Cash paid	$	21,151		$	15,276		$	36,427		$	30,680		$	5,193		$	9,088		$	24,199		$	3,015		$	72,175

Estimates of Acquired Intangible Assets

Estimates of acquired intangible assets related to the acquisitions are as follows (dollars in thousands):

	2016				2015
Acquired intangibles assets	Estimated Fair Value		Weighted Avg Estimated Useful Life (yrs)		Estimated Fair Value		Weighted Avg Estimated Useful Life (yrs)
Customer relationships	$	12,862		9	$	29,958		8
Trademarks and trade names		6,116		15		12,882		15
Non-competition agreements		2,314		5		3,818		5

Pro Forma Results of Operations

The unaudited pro forma information for the combined results of the Company has been prepared as if the 2016 acquisitions had taken place on January 1, 2015 and the 2015 acquisitions had taken place on January 1, 2014. The unaudited pro forma information is not necessarily indicative of the results that we would have achieved had the transactions actually taken place on January 1, 2015 and 2014, and the unaudited pro forma information does not purport to be indicative of future financial operating results.  See Note 12, Business Combinations, to our audited financial statements in Item 8 of Part II of our 2015 Form 10-K for additional information on 2015 acquisitions included in the table below (in thousands, except per share data):

	Pro forma for the three months ended September 30,				Pro forma for the nine months ended September 30,
	2016		2015		2016		2015
Net revenue	$	226,329	$	202,830	$	642,343	$	554,882
Net income attributable to common stockholders	$	11,709	$	10,211	$	27,387	$	19,353
Basic net income per share attributable to    common stockholders	$	0.37	$	0.33	$	0.88	$	0.62
Diluted net income per share attributable to    common stockholders	$	0.37	$	0.33	$	0.87	$	0.62

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Income Per Common Share (Tables)

9 Months Ended

Sep. 30, 2016

Earnings Per Share [Abstract]

Summary of Diluted Income Per Share

Diluted income per share was as follows (in thousands, except share and per share data):

	For the three months ended September 30,				For the nine months ended September 30,
	2016		2015		2016		2015
Net income attributable to common stockholders - basic    and diluted	$	11,549	$	9,481	$	27,355	$	17,230
Weighted average number of common shares outstanding		31,323,600		31,237,275		31,294,596		31,318,682
Dilutive effect of outstanding common stock awards    after application of the Treasury Stock Method		54,190		51,334		57,395		24,548
Diluted shares outstanding		31,377,790		31,288,609		31,351,991		31,343,230
Basic income per share attributable to common stockholders	$	0.37	$	0.30	$	0.87	$	0.55
Diluted income per share attributable to common    stockholders	$	0.37	$	0.30	$	0.87	$	0.55

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Organization - Additional Information (Detail)	9 Months Ended
	Sep. 30, 2016 Location Segment
Basis Of Presentation And Organization [Line Items]
Number of operating segment | Segment	1
UNITED STATES
Basis Of Presentation And Organization [Line Items]
Number of locations the company operates | Location	100

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Organization - Summary of Percentage of Net Revenue by End Market (Detail) - Customer Concentration Risk [Member] - Revenue [Member]	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Product Information [Line Items]
Net revenues percentage	100.00%	100.00%	100.00%	100.00%
Residential New Construction and Repair and Remodel [Member]
Product Information [Line Items]
Net revenues percentage	89.00%	89.00%	88.00%	89.00%
Commercial Construction [Member]
Product Information [Line Items]
Net revenues percentage	11.00%	11.00%	12.00%	11.00%

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Significant Accounting Policies - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Accounting Policies and General Information [Line Items]
Advertising expenses	$ 0.8	$ 0.6	$ 2.2	$ 1.6
ASU 2015-03 [Member]
Accounting Policies and General Information [Line Items]
Debt issuance costs			0.5
Deferred debt issuance costs, net of accumulated amortization	$ 1.3		$ 1.3		$ 0.6

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Goodwill and Intangibles - Summary of Change in Carrying Amount of Goodwill (Detail) $ in Thousands	9 Months Ended
	Sep. 30, 2016 USD ($)
Goodwill And Intangible Assets Disclosure [Abstract]
Goodwill (Gross), beginning balance	$ 160,516
Business Combinations	12,006
Goodwill (Gross), ending balance	172,522
Accumulated Impairment Losses, beginning balance	(70,004)
Accumulated Impairment Losses, ending balance	(70,004)
Goodwill (Net), beginning balance	90,512
Goodwill (Net), ending balance	$ 102,518

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Goodwill and Intangibles - Additional Information (Detail) - USD ($)	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Goodwill And Intangible Assets Disclosure [Abstract]
Goodwill impairment	$ 0	$ 0
Increase in gross carrying amount of intangibles	$ 21,400,000

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Goodwill and Intangibles - Schedule of Gross Carrying Amount, Accumulated Amortization and Net Book Value (Detail) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 117,840	$ 96,448
Accumulated Amortization	37,417	29,230
Net Book Value	80,423	67,218
Customer Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	75,261	62,399
Accumulated Amortization	25,562	20,231
Net Book Value	49,699	42,168
Covenants Not-to-compete [Member]
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	8,143	5,729
Accumulated Amortization	2,003	847
Net Book Value	6,140	4,882
Trademarks and Trade Names [Member]
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	34,436	28,320
Accumulated Amortization	9,852	8,152
Net Book Value	$ 24,584	$ 20,168

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Goodwill and Intangibles - Schedule of Estimated Aggregate Annual Amortization (Detail) $ in Thousands	Sep. 30, 2016 USD ($)
Finite Lived Intangible Assets Net Amortization Expense Rolling Maturity [Abstract]
Remainder of 2016	$ 2,859
2017	11,045
2018	10,741
2019	10,229
2020	9,622
Thereafter	$ 35,927

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Long-term Debt - Schedule of Maturities of Long-term Debt (Detail) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Debt Instrument [Line Items]
Term loans, as amended, net of unamortized debt discount of $477 and $249, respectively	$ 97,030	$ 47,876
Vehicle and equipment notes, maturing through September 2021; payable in various monthly installments, including interest rates ranging from 2% to 4%	33,414	21,091
Various notes payable, maturing through March 2025; payable in various monthly installments, including interest rates ranging from 4% to 6%	5,188	4,529
Total long term debt	148,075	123,235
Less: current maturities	(15,064)	(10,021)
Long-term debt, less current maturities	133,011	113,214
Delayed Draw [Member]
Debt Instrument [Line Items]
Delayed draw term loans, as amended, net of unamortized debt discount of $50 and $261, respectively	$ 12,443	$ 49,739

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Long-term Debt - Schedule of Maturities of Long-term Debt (Parenthetical) (Detail) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2016	Dec. 31, 2015
Debt Instrument [Line Items]
Unamortized debt discount	$ 477	$ 249
Notes payable maturity date	2025-03
Minimum [Member]
Debt Instrument [Line Items]
Notes payable Interest rate	4.00%
Maximum [Member]
Debt Instrument [Line Items]
Notes payable Interest rate	6.00%
Delayed Draw [Member]
Debt Instrument [Line Items]
Unamortized debt discount	$ 50	$ 261
Vehicle and Equipment [Member]
Debt Instrument [Line Items]
Notes payable maturity date	2021-09
Vehicle and Equipment [Member] | Minimum [Member]
Debt Instrument [Line Items]
Notes payable Interest rate	2.00%
Vehicle and Equipment [Member] | Maximum [Member]
Debt Instrument [Line Items]
Notes payable Interest rate	4.00%

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Long-term Debt - Additional Information (Detail) - USD ($)		9 Months Ended	12 Months Ended
	Feb. 29, 2016	Sep. 30, 2016	Dec. 31, 2015
Debt Instrument [Line Items]
Assets relating to master loan agreements, Gross		$ 64,700,000	$ 64,900,000
Capital leased assets, net book value		$ 17,800,000	22,100,000
Master Loan Agreements [Member]
Debt Instrument [Line Items]
Payment Period, typical		60 months
Assets relating to master loan agreements, Gross		$ 43,500,000	25,400,000
Capital leased assets, net book value		35,200,000	$ 22,400,000
Credit and Security Agreement [Member]
Debt Instrument [Line Items]
Debt instrument, face amount	$ 325,000,000
Issuance of letters of credit		$ 18,000,000
Principal amount of term loans or additional revolving credit commitments	$ 75,000,000
Credit facility, covenant terms		The Credit and Security Agreement contains covenants that require us to (1) maintain a fixed charge coverage ratio of not less than 1.10 to 1.0 and (2) maintain a leverage ratio of no greater than: (a) 3.50 to 1.00 through December 30, 2016; (b) 3.25 to 1.00 on December 31, 2016 through June 29, 2017; (c) 3.00 to 1.00 on June 30, 2017 through December 30, 2017; (d) 2.75 to 1.00 on December 31, 2017 through June 29, 2018; and (e) 2.50 to 1.00 on June 30, 2018 and thereafter.
Credit facility, interest rate description		The Credit and Security Agreement also contains various restrictive non-financial covenants and a provision that, upon an event of default (as defined by the Credit and Security Agreement), amounts outstanding under the Credit and Security Agreement would bear interest at the rate as determined above plus 2.0% per annum.
Contingent interest rate increase	2.00%
Credit and Security Agreement [Member] | Minimum [Member] | Through the First Quarter Ending June 30, 2016 [Member]
Debt Instrument [Line Items]
Fixed coverage ratio, covenants requirements	110.00%
Credit and Security Agreement [Member] | Maximum [Member] | Through December 30, 2016 [Member]
Debt Instrument [Line Items]
Leverage Ratio, covenants requirements	350.00%
Credit and Security Agreement [Member] | Maximum [Member] | December 31, 2016 Through June 29, 2017 [Member]
Debt Instrument [Line Items]
Leverage Ratio, covenants requirements	325.00%
Credit and Security Agreement [Member] | Maximum [Member] | June 30, 2017 Through December 30, 2017 [Member]
Debt Instrument [Line Items]
Leverage Ratio, covenants requirements	300.00%
Credit and Security Agreement [Member] | Maximum [Member] | December 31, 2017 Through June 29, 2018 [Member]
Debt Instrument [Line Items]
Leverage Ratio, covenants requirements	275.00%
Credit and Security Agreement [Member] | Maximum [Member] | June 30, 2018 and Thereafter [Member]
Debt Instrument [Line Items]
Leverage Ratio, covenants requirements	250.00%
Credit and Security Agreement [Member] | Senior Secured Credit Facilities [Member]
Debt Instrument [Line Items]
Credit facility term	5 years
Credit and Security Agreement [Member] | Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Line of credit maximum borrowing capacity	$ 100,000,000
Issuance of letters of credit	$ 20,000,000
Line of credit outstanding		$ 0
Commitment fee		0.225%
Credit and Security Agreement [Member] | Revolving Credit Facility [Member] | February 29, 2016 Through August 31, 2016 [Member]
Debt Instrument [Line Items]
Commitment fee	0.225%
Credit and Security Agreement [Member] | Revolving Credit Facility [Member] | Minimum [Member]
Debt Instrument [Line Items]
Commitment fee	0.20%
Credit and Security Agreement [Member] | Revolving Credit Facility [Member] | Maximum [Member]
Debt Instrument [Line Items]
Commitment fee	0.30%
Credit and Security Agreement [Member] | Term Loan [Member]
Debt Instrument [Line Items]
Debt instrument, face amount	$ 100,000,000
Credit and Security Agreement [Member] | Term Loan [Member] | LIBOR [Member]
Debt Instrument [Line Items]
Margin interest rate percentage		2.31%	1.95%
Interest rate terms		1-month LIBOR
Credit and Security Agreement [Member] | Delayed Draw Term Loan [Member]
Debt Instrument [Line Items]
Debt instrument, face amount	$ 125,000,000
Ticking fee	0.375%
Maturity date	Feb. 28, 2017
Credit and Security Agreement [Member] | Delayed Draw Term Loan [Member] | LIBOR [Member]
Debt Instrument [Line Items]
Margin interest rate percentage		2.31%	1.95%
Interest rate terms		1-month LIBOR
Credit and Security Agreement [Member] | Swing Lines Loan [Member]
Debt Instrument [Line Items]
Issuance of letters of credit	$ 5,000,000
Credit and Security Agreement [Member] | Term Loan And Delayed Draw Term Loan [Member] | LIBOR [Member]
Debt Instrument [Line Items]
Maturity date	Feb. 28, 2021

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Employee Benefits - Additional Information (Detail)	3 Months Ended		9 Months Ended
	Sep. 30, 2016 USD ($) shares	Sep. 30, 2015 USD ($)	Sep. 30, 2016 USD ($) Installment shares	Sep. 30, 2015 USD ($) Installment shares	Dec. 31, 2015 USD ($)
Pension Plans, Postretirement and Other Employee Benefits [Line Items]
Healthcare benefit expense, net of employee contributions	$ 3,700,000	$ 3,000,000	$ 11,400,000	$ 8,900,000
Accrued compensation	17,464,000		17,464,000		$ 14,488,000
Workers' compensation expense	3,400,000	2,600,000	$ 9,200,000	$ 6,600,000
Common stock granted, shares | shares			143,528
Unrecognized compensation expense	3,400,000		$ 3,400,000
Common nonvested shares, compensation cost not yet recognized, period for recognition			2 years 6 months
2014 Omnibus Incentive Plan [Member]
Pension Plans, Postretirement and Other Employee Benefits [Line Items]
Common stock granted, shares | shares			100,000	100,000
Share based compensation expenses	400,000	$ 600,000	$ 1,200,000	$ 1,200,000
Number of equal installments for vesting common stock | Installment			3	3
Number of shares surrendered to satisfy tax withholding obligations | shares			32,000
Share based compensation, recognized tax benefits	$ 0		$ 300,000
Common stock vested percentage				100.00%
Common stock shares available for issuance | shares	2,700,000		2,700,000
2014 Omnibus Incentive Plan [Member] | Directors [Member]
Pension Plans, Postretirement and Other Employee Benefits [Line Items]
Common stock granted, shares | shares			9,000	13,000
Share based compensation expenses			$ 300,000	$ 300,000
Medical IBNR Included in Accrued Compensation [Member]
Pension Plans, Postretirement and Other Employee Benefits [Line Items]
Accrued compensation	$ 1,600,000		$ 1,600,000		$ 1,500,000

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Employee Benefits - Summary of Workers' Compensation Known Claims and IBNR Reserves (Detail) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Employee Related Liabilities Current And Noncurrent [Abstract]
Included in other current liabilities	$ 4,033	$ 3,263
Included in other long-term liabilities	7,503	7,132
Workers' Compensation Liability	$ 11,536	$ 10,395

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Employee Benefits - Schedule of Insurance Receivable for Claims (Detail) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Workers' Compensation [Member]
Malpractice Insurance [Line Items]
Included in other non-current assets	$ 1,256	$ 1,542

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Employee Benefits - Summary of Nonvested Common Stock Awards and Changes During Period (Detail)	9 Months Ended
	Sep. 30, 2016 $ / shares shares
Common Stock Awards
Nonvested common stock awards, Beginning balance | shares	129,053
Granted | shares	143,528
Vested | shares	(109,473)
Forfeited | shares	(1,183)
Nonvested common stock awards, Ending balance | shares	161,925
Weighted Average Grant Date Fair Market Value Per Share
Nonvested common stock awards, Beginning balance | $ / shares	$ 21.52
Granted | $ / shares	26.98
Vested | $ / shares	21.48
Forfeited | $ / shares	24.97
Nonvested common stock awards, Ending balance | $ / shares	$ 26.37

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Income Taxes - Additional Information (Detail) - USD ($)	3 Months Ended	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2016
Income Taxes [Line Items]
Effective tax rate from continuing operations	36.80%	35.10%
Income tax benefit		$ 0
ASU 2016-09 [Member]
Income Taxes [Line Items]
Excess income tax benefits recognized from stock-based compensation	$ 0	$ 300,000

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Related Party Transactions - Schedule of Related Party Transactions (Detail) - Affiliated Entity [Member] - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Related Party Transaction [Line Items]
Sales	$ 2,182	$ 1,924	$ 5,282	$ 4,661
Purchases	114	80	370	366
Rent	$ 163	$ 150	$ 472	$ 446

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Related Party Transactions - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands, shares in Millions		9 Months Ended
	Mar. 13, 2015	Sep. 30, 2015	Sep. 30, 2016	Dec. 31, 2015
Related Party Transaction [Line Items]
Share repurchase, amount		$ 6,100
Affiliated Entity [Member]
Related Party Transaction [Line Items]
Accounts receivable, related parties			$ 1,400	$ 1,800
M/I Homes Inc [Member]
Related Party Transaction [Line Items]
Accounts receivable, related parties			$ 800	$ 1,000
IBS [Member]
Related Party Transaction [Line Items]
Common Stock Repurchase, Shares	0.3
Share repurchase, amount	$ 6,100
Share repurchase, price per share	$ 19.23
Discount from last reported price of our common stock	7.50%

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Commitments and Contingencies - Schedule of Accrued General Insurance Reserves (Detail) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Commitments And Contingencies Disclosure [Abstract]
Included in other current liabilities	$ 1,667	$ 1,304
Included in other long-term liabilities	8,514	6,879
Total	$ 10,181	$ 8,183

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Commitments and Contingencies - Schedule of General Liability Insurance Receivable for Claims (Detail) - General Liability [Member] - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Commitments And Contingencies Disclosure [Line Items]
Insurance receivable and indemnification asset for claims under a fully insured policy	$ 2,815	$ 2,815
Insurance receivable for claims that exceeded the stop loss limit	907	821
Total insurance receivables included in other non-current assets	$ 3,722	$ 3,636

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Commitments and Contingencies - Additional Information (Detail) $ in Millions	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2016 USD ($)	Sep. 30, 2015 USD ($)	Sep. 30, 2016 USD ($) Contract	Sep. 30, 2015 USD ($)	Dec. 31, 2015 USD ($)
Commitments And Contingencies Disclosure [Line Items]
Capital lease assets	$ 64.7		$ 64.7		$ 64.9
Assets fully depreciated			23.1		19.1
Capital leased assets, net book value	17.8		17.8		22.1
Accumulated depreciation	46.9		46.9		$ 42.8
Actual purchases made under contract	$ 6.5	$ 16.6	$ 32.9	$ 41.5
Contract One [Member]
Commitments And Contingencies Disclosure [Line Items]
Extended term of contract			Dec. 31, 2016
Contract Two [Member]
Commitments And Contingencies Disclosure [Line Items]
Number of product supply contracts | Contract			2
Extended term of contract			Aug. 31, 2017
Minimum [Member]
Commitments And Contingencies Disclosure [Line Items]
Estimated life of capital lease			4 years
Noncancellable operating leases, renewal period			1 year
Maximum [Member]
Commitments And Contingencies Disclosure [Line Items]
Estimated life of capital lease			6 years
Noncancellable operating leases, renewal period			5 years

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Commitments and Contingencies - Future Minimum Lease Payments Under Noncancellable Operating Leases (Detail) $ in Thousands	Sep. 30, 2016 USD ($)
Commitments And Contingencies Disclosure [Abstract]
Remainder of 2016	$ 133
2017	366
2018	155
2019	0
2020	0
Thereafter	$ 0

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Business Combinations - Additional Information (Detail) $ in Thousands												3 Months Ended		9 Months Ended
	Aug. 15, 2016 USD ($)	Jul. 25, 2016 USD ($)	Apr. 12, 2016 USD ($)	Feb. 29, 2016 USD ($)	Feb. 02, 2016 USD ($)	Jan. 25, 2016 USD ($)	Aug. 10, 2015 USD ($)	Jul. 01, 2015 USD ($)	Jun. 01, 2015 USD ($)	Apr. 06, 2015 USD ($)	Mar. 12, 2015 USD ($)	Sep. 30, 2016 USD ($)	Sep. 30, 2015 USD ($)	Sep. 30, 2016 USD ($) Business	Sep. 30, 2015 USD ($) Business
Business Acquisition [Line Items]
Business combinations | Business														6	5
Goodwill acquired expected to be tax deductible												$ 12,800	$ 22,100	$ 12,800	$ 22,100
Purchase price paid in cash														36,427	71,040
Seller obligations in connection with acquisition of businesses														2,849	12,364
Revenue												225,392	181,579	629,003	471,220
Net income (loss)														27,355	17,230
Amortization of intangibles												2,889	1,817	8,178	4,091
Income tax expense (benefit)												6,723	4,869	14,792	9,612
Key Insulation [Member]
Business Acquisition [Line Items]
Purchase price paid in cash						$ 5,000
Seller obligations in connection with acquisition of businesses						$ 700
Revenue												2,000		6,300
Net income (loss)												(200)		(400)
Marshall Insulation LLC [Member]
Business Acquisition [Line Items]
Purchase price paid in cash					$ 900
Seller obligations in connection with acquisition of businesses					$ 100
Revenue												1,000		2,500
Net income (loss)												(54)		(200)
Kern Door Company [Member]
Business Acquisition [Line Items]
Purchase price paid in cash				$ 2,900
Seller obligations in connection with acquisition of businesses				$ 100
Revenue												1,000		2,000
Net income (loss)												(62)		(200)
BDI Insulation [Member]
Business Acquisition [Line Items]
Purchase price paid in cash											$ 30,700
Seller obligations in connection with acquisition of businesses											$ 5,800				5,765
Revenue													10,300		22,500
Net income (loss)													600		1,600
Ownership percentage acquired											100.00%
Insurance receivable for claims under a fully insured policy												2,000	2,000	2,000	2,000
Indemnification asset associated with the acquisition												1,600	1,600	1,600	1,600
Combined Business Acquisitions [Member]
Business Acquisition [Line Items]
Seller obligations in connection with acquisition of businesses														2,849	12,103
Amortization of intangibles												37	1,200	700	4,900
Income tax expense (benefit)												100	300	18	1,200
Transaction costs													1,000		1,000
Alpine [Member]
Business Acquisition [Line Items]
Purchase price paid in cash			$ 21,200
Seller obligations in connection with acquisition of businesses			$ 1,600											1,560
Revenue												7,900		14,700
Net income (loss)												800		1,200
FireClass, LLC [Member]
Business Acquisition [Line Items]
Purchase price paid in cash		$ 2,300
Revenue												800		800
Net income (loss)												21		21
Southern Insulators & Specialties LLC [Member]
Business Acquisition [Line Items]
Purchase price paid in cash	$ 4,100
Seller obligations in connection with acquisition of businesses	$ 400
Revenue												700		700
Net income (loss)												$ 100		$ 100
CQ Insulation [Member]
Business Acquisition [Line Items]
Purchase price paid in cash										$ 5,200
Seller obligations in connection with acquisition of businesses										$ 2,300					2,319
Revenue													2,700		5,400
Net income (loss)													300		500
Ownership percentage acquired										100.00%
Layman Brothers Contracting [Member]
Business Acquisition [Line Items]
Purchase price paid in cash									$ 9,100
Seller obligations in connection with acquisition of businesses									$ 600						600
Revenue													3,700		4,900
Net income (loss)													300		400
EcoLogic Energy Solutions [Member]
Business Acquisition [Line Items]
Purchase price paid in cash								$ 3,000
Seller obligations in connection with acquisition of businesses								$ 500
Revenue													1,800		1,800
Net income (loss)													36		36
Eastern Contractor Services [Member]
Business Acquisition [Line Items]
Purchase price paid in cash							$ 24,200
Seller obligations in connection with acquisition of businesses							$ 2,900								2,875
Revenue													3,000		3,000
Net income (loss)													$ 300		$ 300
Ownership percentage acquired							100.00%

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Business Combinations - Summary of Estimated Fair Value of Assets Acquired and Liabilities Assumed (Detail) - USD ($) $ in Thousands						9 Months Ended
	Apr. 12, 2016	Aug. 10, 2015	Jun. 01, 2015	Apr. 06, 2015	Mar. 12, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Business Acquisition [Line Items]
Goodwill						$ 102,518		$ 90,512
Less seller obligations						2,849	$ 12,364
Alpine [Member]
Business Acquisition [Line Items]
Accounts receivable						3,959
Inventories						700
Other current assets						18
Property and equipment						656
Intangibles						12,800
Goodwill						6,624
Accounts payable and other current liabilities						(2,046)
Fair value of assets acquired and purchase price						22,711
Less seller obligations	$ 1,600					1,560
Cash paid						21,151
Other Acquisition [Member]
Business Acquisition [Line Items]
Accounts receivable						2,031	1,049
Inventories						888	119
Other current assets						12	10
Property and equipment						1,187	406
Intangibles						8,492	1,827
Goodwill						5,368	875
Other non-current assets						70	56
Accounts payable and other current liabilities						(1,459)	(783)
Deferred income tax liabilities						(24)
Fair value of assets acquired and purchase price						16,565	3,559
Less seller obligations						1,289	544
Cash paid						15,276	3,015
Combined Business Acquisitions [Member]
Business Acquisition [Line Items]
Cash							926
Accounts receivable						5,990	11,220
Inventories						1,588	1,853
Other current assets						30	526
Property and equipment						1,843	3,699
Intangibles						21,292	46,658
Goodwill						11,992	33,170
Other non-current assets						70	4,114
Accounts payable and other current liabilities						(3,505)	(8,336)
Deferred income tax liabilities						(24)	(5,495)
Long term debt							(82)
Other long-term liabilities							(3,975)
Fair value of assets acquired and purchase price						39,276	84,278
Less seller obligations						2,849	12,103
Cash paid						$ 36,427	72,175
BDI Insulation [Member]
Business Acquisition [Line Items]
Cash							661
Accounts receivable							4,735
Inventories							980
Other current assets							368
Property and equipment							1,006
Intangibles							21,280
Goodwill							16,213
Other non-current assets							3,736
Accounts payable and other current liabilities							(3,303)
Deferred income tax liabilities							(5,495)
Other long-term liabilities							(3,736)
Fair value of assets acquired and purchase price							36,445
Less seller obligations					$ 5,800		5,765
Cash paid							30,680
Eastern Contractor Services [Member]
Business Acquisition [Line Items]
Cash							165
Accounts receivable							2,768
Inventories							335
Other current assets							109
Property and equipment							1,364
Intangibles							13,871
Goodwill							9,904
Other non-current assets							322
Accounts payable and other current liabilities							(1,681)
Long term debt							(82)
Other long-term liabilities							(1)
Fair value of assets acquired and purchase price							27,074
Less seller obligations		$ 2,900					2,875
Cash paid							24,199
CQ Insulation [Member]
Business Acquisition [Line Items]
Cash							100
Accounts receivable							1,423
Inventories							152
Other current assets							39
Property and equipment							190
Intangibles							4,350
Goodwill							3,035
Accounts payable and other current liabilities							(1,539)
Other long-term liabilities							(238)
Fair value of assets acquired and purchase price							7,512
Less seller obligations				$ 2,300			2,319
Cash paid							5,193
Layman Brothers Contracting [Member]
Business Acquisition [Line Items]
Accounts receivable							1,245
Inventories							267
Property and equipment							733
Intangibles							5,330
Goodwill							3,143
Accounts payable and other current liabilities							(1,030)
Fair value of assets acquired and purchase price							9,688
Less seller obligations			$ 600				600
Cash paid							$ 9,088

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Business Combinations - Estimates of Acquired Intangible Assets (Detail) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Customer Relationships [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Estimated Fair Value	$ 12,862	$ 29,958
Weighted Avg Estimated Useful Life (yrs)	9 years	8 years
Trademarks and Trade Names [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Estimated Fair Value	$ 6,116	$ 12,882
Weighted Avg Estimated Useful Life (yrs)	15 years	15 years
Covenants Not-to-compete [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Estimated Fair Value	$ 2,314	$ 3,818
Weighted Avg Estimated Useful Life (yrs)	5 years	5 years

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Business Combinations - Pro Forma Results of Operations (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Business Combination Increase Decrease To Reflect Liabilities Acquired At Fair Value [Abstract]
Net revenue	$ 226,329	$ 202,830	$ 642,343	$ 554,882
Net income attributable to common stockholders	$ 11,709	$ 10,211	$ 27,387	$ 19,353
Basic net income per share attributable to common stockholders	$ 0.37	$ 0.33	$ 0.88	$ 0.62
Diluted net income per share attributable to common stockholders	$ 0.37	$ 0.33	$ 0.87	$ 0.62

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Income Per Common Share - Summary of Diluted Income Per Common Share (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Earnings Per Share [Abstract]
Net income attributable to common stockholders - basic and diluted	$ 11,549	$ 9,481	$ 27,355	$ 17,230
Weighted average number of common shares outstanding	31,323,600	31,237,275	31,294,596	31,318,682
Dilutive effect of outstanding common stock awards after application of the Treasury Stock Method	54,190	51,334	57,395	24,548
Diluted shares outstanding	31,377,790	31,288,609	31,351,991	31,343,230
Basic income per share attributable to common stockholders	$ 0.37	$ 0.30	$ 0.87	$ 0.55
Diluted income per share attributable to common stockholders	$ 0.37	$ 0.30	$ 0.87	$ 0.55

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Subsequent Events - Additional Information (Detail) - USD ($) $ in Thousands				9 Months Ended
	Nov. 01, 2016	Oct. 29, 2016	Oct. 17, 2016	Sep. 30, 2016	Sep. 30, 2015
Subsequent Event [Line Items]
Seller obligations in connection with acquisition of businesses				$ 2,849	$ 12,364
Subsequent Event [Member] | East Coast Insulators II, L.L.C [Member]
Subsequent Event [Line Items]
Consideration transferred for acquisition			$ 16,500
Subsequent Event [Member] | Trilok Industries, Inc [Member]
Subsequent Event [Line Items]
Consideration transferred for acquisition		$ 92,100
Seller obligations in connection with acquisition of businesses		1,900
Subsequent Event [Member] | Trilok Industries, Inc [Member] | Common Stock [Member]
Subsequent Event [Line Items]
Purchase consideration, value of shares issued		$ 9,200
Purchase consideration, number of shares issued		282,577
Business acquisition in excess indebtedness payment to reduce purchase price.		$ 400
Subsequent Event [Member] | Mike’s Garage Door, L.L.C [Member]
Subsequent Event [Line Items]
Consideration transferred for acquisition	$ 600