QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||
(Address of principal executive offices) | (Zip Code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
x | Accelerated filer | o | ||||
Non-accelerated filer | o | Smaller reporting company | ||||
Emerging growth company | ||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. | ☐ |
Page | ||
PART I | ||
Item 1. | ||
Item 2. | ||
Item 3. | ||
Item 4. | ||
PART II | ||
Item 1. | ||
Item 1A. | ||
Item 2. | ||
Item 6. | ||
Item 1. | Financial Statements |
(In thousands, except stock data) | May 30, 2020 | February 29, 2020 | ||||||
Assets | ||||||||
Current assets | ||||||||
Cash and cash equivalents | $ | $ | ||||||
Receivables, net of allowance for doubtful accounts | ||||||||
Inventories | ||||||||
Costs and earnings on contracts in excess of billings | ||||||||
Other current assets | ||||||||
Total current assets | ||||||||
Property, plant and equipment, net | ||||||||
Operating lease right-of-use assets | ||||||||
Goodwill | ||||||||
Intangible assets | ||||||||
Other non-current assets | ||||||||
Total assets | $ | $ | ||||||
Liabilities and Shareholders’ Equity | ||||||||
Current liabilities | ||||||||
Accounts payable | $ | $ | ||||||
Accrued payroll and related benefits | ||||||||
Billings on contracts in excess of costs and earnings | ||||||||
Operating lease liabilities | ||||||||
Current portion of debt | ||||||||
Other current liabilities | ||||||||
Total current liabilities | ||||||||
Long-term debt | ||||||||
Non-current operating lease liabilities | ||||||||
Non-current self-insurance reserves | ||||||||
Other non-current liabilities | ||||||||
Commitments and contingent liabilities (Note 8) | ||||||||
Shareholders’ equity | ||||||||
Common stock of $0.33-1/3 par value; authorized 50,000,000 shares; issued and outstanding 26,368,864 and 26,443,166 respectively | ||||||||
Additional paid-in capital | ||||||||
Retained earnings | ||||||||
Common stock held in trust | ( | ) | ( | ) | ||||
Deferred compensation obligations | ||||||||
Accumulated other comprehensive loss | ( | ) | ( | ) | ||||
Total shareholders’ equity | ||||||||
Total liabilities and shareholders’ equity | $ | $ |
Three Months Ended | ||||||||
(In thousands, except per share data) | May 30, 2020 | June 1, 2019 | ||||||
Net sales | $ | $ | ||||||
Cost of sales | ||||||||
Gross profit | ||||||||
Selling, general and administrative expenses | ||||||||
Operating income | ||||||||
Interest and other expense, net | ||||||||
Earnings before income taxes | ||||||||
Income tax expense | ||||||||
Net earnings | $ | $ | ||||||
Earnings per share - basic | $ | $ | ||||||
Earnings per share - diluted | $ | $ | ||||||
Weighted average basic shares outstanding | ||||||||
Weighted average diluted shares outstanding |
Three Months Ended | ||||||||
(In thousands) | May 30, 2020 | June 1, 2019 | ||||||
Net earnings | $ | $ | ||||||
Other comprehensive (loss) earnings: | ||||||||
Unrealized gain on marketable securities, net of $26 and $47 of tax expense, respectively | ||||||||
Unrealized (loss) gain on derivative instruments, net of ($189) and $2 of tax (benefit) expense, respectively | ( | ) | ||||||
Foreign currency translation adjustments | ( | ) | ( | ) | ||||
Other comprehensive loss | ( | ) | ( | ) | ||||
Total comprehensive (loss) earnings | $ | ( | ) | $ |
Three Months Ended | ||||||||
(In thousands) | May 30, 2020 | June 1, 2019 | ||||||
Operating Activities | ||||||||
Net earnings | $ | $ | ||||||
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||||||||
Depreciation and amortization | ||||||||
Share-based compensation | ||||||||
Deferred income taxes | ( | ) | ||||||
Noncash lease expense | ||||||||
Other, net | ( | ) | ||||||
Changes in operating assets and liabilities: | ||||||||
Receivables | ( | ) | ||||||
Inventories | ( | ) | ||||||
Costs and earnings on contracts in excess of billings | ( | ) | ||||||
Accounts payable and accrued expenses | ( | ) | ( | ) | ||||
Billings on contracts in excess of costs and earnings | ( | ) | ( | ) | ||||
Refundable and accrued income taxes | ( | ) | ||||||
Operating lease liability | ( | ) | ( | ) | ||||
Other | ( | ) | ||||||
Net cash provided (used) by operating activities | ( | ) | ||||||
Investing Activities | ||||||||
Capital expenditures | ( | ) | ( | ) | ||||
Other | ( | ) | ( | ) | ||||
Net cash used by investing activities | ( | ) | ( | ) | ||||
Financing Activities | ||||||||
Borrowings on line of credit | ||||||||
Payments on line of credit | ( | ) | ( | ) | ||||
Repurchase and retirement of common stock | ( | ) | ( | ) | ||||
Dividends paid | ( | ) | ( | ) | ||||
Other | ( | ) | ( | ) | ||||
Net cash (used) provided by financing activities | ( | ) | ||||||
Decrease in cash and cash equivalents | ( | ) | ( | ) | ||||
Effect of exchange rates on cash | ( | ) | ( | ) | ||||
Cash, cash equivalents and restricted cash at beginning of year | ||||||||
Cash, cash equivalents and restricted cash at end of period | $ | $ | ||||||
Noncash Activity | ||||||||
Capital expenditures in accounts payable | $ | $ |
(In thousands) | Common Shares Outstanding | Common Stock | Additional Paid-In Capital | Retained Earnings | Common Stock Held in Trust | Deferred Compensation Obligation | Accumulated Other Comprehensive (Loss) Income | Total Shareholders' Equity | |||||||||||||||||||||||
Balance at February 29, 2020 | $ | $ | $ | $ | ( | ) | $ | $ | ( | ) | $ | ||||||||||||||||||||
Net earnings | — | — | — | — | — | — | |||||||||||||||||||||||||
Unrealized gain on marketable securities, net of $26 tax expense | — | — | — | — | — | — | |||||||||||||||||||||||||
Unrealized loss on foreign currency hedge, net of $189 tax benefit | — | — | — | — | — | — | ( | ) | ( | ) | |||||||||||||||||||||
Foreign currency translation adjustments | — | — | — | — | — | — | ( | ) | ( | ) | |||||||||||||||||||||
Issuance of stock, net of cancellations | ( | ) | — | ( | ) | — | |||||||||||||||||||||||||
Share-based compensation | — | — | — | — | — | — | |||||||||||||||||||||||||
Share repurchases | ( | ) | ( | ) | ( | ) | ( | ) | — | — | — | ( | ) | ||||||||||||||||||
Other share retirements | ( | ) | ( | ) | ( | ) | ( | ) | — | — | — | ( | ) | ||||||||||||||||||
Cash dividends | — | — | — | ( | ) | — | — | — | ( | ) | |||||||||||||||||||||
Balance at May 30, 2020 | $ | $ | $ | $ | ( | ) | $ | $ | ( | ) | $ |
(In thousands) | Common Shares Outstanding | Common Stock | Additional Paid-In Capital | Retained Earnings | Common Stock Held in Trust | Deferred Compensation Obligation | Accumulated Other Comprehensive (Loss) Income | Total Shareholders' Equity | |||||||||||||||||||||||
Balance at March 2, 2019 | $ | $ | $ | $ | ( | ) | $ | $ | ( | ) | $ | ||||||||||||||||||||
Net earnings | — | — | — | — | — | — | |||||||||||||||||||||||||
Unrealized gain on marketable securities, net of $47 tax expense | — | — | — | — | — | — | |||||||||||||||||||||||||
Unrealized gain on foreign currency hedge, net of $2 tax expense | — | — | — | — | — | — | |||||||||||||||||||||||||
Foreign currency translation adjustments | — | — | — | — | — | — | ( | ) | ( | ) | |||||||||||||||||||||
Issuance of stock, net of cancellations | — | ( | ) | — | |||||||||||||||||||||||||||
Share-based compensation | — | — | — | — | — | — | |||||||||||||||||||||||||
Share repurchases | ( | ) | ( | ) | ( | ) | ( | ) | — | — | — | ( | ) | ||||||||||||||||||
Other share retirements | ( | ) | ( | ) | ( | ) | ( | ) | — | — | — | ( | ) | ||||||||||||||||||
Cash dividends | — | — | — | ( | ) | — | — | — | ( | ) | |||||||||||||||||||||
Balance at June 1, 2019 | $ | $ | $ | $ | ( | ) | $ | $ | ( | ) | $ |
1. | Summary of Significant Accounting Policies |
2. | Revenue, Receivables and Contract Assets and Liabilities |
Three Months Ended | ||||||||
(In thousands) | May 30, 2020 | June 1, 2019 | ||||||
Recognized at shipment | $ | $ | ||||||
Recognized over time | ||||||||
Total | $ | $ |
(In thousands) | May 30, 2020 | February 29, 2020 | ||||||
Trade accounts | $ | $ | ||||||
Construction contracts | ||||||||
Contract retainage | ||||||||
Total receivables | ||||||||
Less: allowance for credit losses | ( | ) | ( | ) | ||||
Net receivables | $ | $ |
(In thousands) | May 30, 2020 | |||
Beginning balance | $ | |||
Additions charged to costs and expenses | ||||
Deductions from allowance, net of recoveries | ( | ) | ||
Other changes (1) | ( | ) | ||
Ending balance | $ | |||
(1) Result of foreign currency effects |
(In thousands) | May 30, 2020 | February 29, 2020 | ||||||
Contract assets | $ | $ | ||||||
Contract liabilities |
Other contract-related disclosures | Three Months Ended | |||||||
(In thousands) | May 30, 2020 | June 1, 2019 | ||||||
Revenue recognized related to contract liabilities from prior year-end | $ | $ | ||||||
Revenue recognized related to prior satisfaction of performance obligations |
(In thousands) | May 30, 2020 | |||
Within one year | $ | |||
Within two years | ||||
Beyond | ||||
Total | $ |
3. | Supplemental Balance Sheet Information |
(In thousands) | May 30, 2020 | February 29, 2020 | ||||||
Raw materials | $ | $ | ||||||
Work-in-process | ||||||||
Finished goods | ||||||||
Total inventories | $ | $ |
(In thousands) | May 30, 2020 | February 29, 2020 | ||||||
Warranties | $ | $ | ||||||
Accrued project losses | ||||||||
Property and other taxes | ||||||||
Accrued self-insurance reserves | ||||||||
Other | ||||||||
Total other current liabilities | $ | $ |
(In thousands) | May 30, 2020 | February 29, 2020 | ||||||
Deferred benefit from New Market Tax Credit transactions | $ | $ | ||||||
Retirement plan obligations | ||||||||
Deferred compensation plan | ||||||||
Deferred tax liabilities | ||||||||
Other | ||||||||
Total other non-current liabilities | $ | $ |
4. | Financial Instruments |
(In thousands) | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value | ||||||||||||
May 30, 2020 | $ | $ | $ | $ | ||||||||||||
February 29, 2020 |
(In thousands) | Amortized Cost | Estimated Fair Value | ||||||
Due within one year | $ | $ | ||||||
Due after one year through five years | ||||||||
Due after five years through 10 years | ||||||||
Due beyond 15 years | ||||||||
Total | $ | $ |
(In thousands) | Quoted Prices in Active Markets (Level 1) | Other Observable Inputs (Level 2) | Total Fair Value | |||||||||
May 30, 2020 | ||||||||||||
Assets: | ||||||||||||
Money market funds | $ | $ | $ | |||||||||
Commercial paper | — | |||||||||||
Municipal and corporate bonds | — | |||||||||||
Cash surrender value of life insurance | — | |||||||||||
Liabilities: | ||||||||||||
Deferred compensation | — | |||||||||||
Foreign currency forward/option contract | — | |||||||||||
Interest rate swap contract | — | |||||||||||
February 29, 2020 | ||||||||||||
Assets: | ||||||||||||
Money market funds | $ | $ | $ | |||||||||
Commercial paper | ||||||||||||
Municipal and corporate bonds | ||||||||||||
Cash surrender value of life insurance | — | |||||||||||
Liabilities: | ||||||||||||
Deferred compensation | — | |||||||||||
Foreign currency forward/option contract | — | |||||||||||
Interest rate swap contract | — |
5. | Goodwill and Other Identifiable Intangible Assets |
(In thousands) | Architectural Framing Systems | Architectural Glass | Architectural Services | Large-Scale Optical | Total | |||||||||||||||
Balance at March 2, 2019 | $ | $ | $ | $ | $ | |||||||||||||||
Foreign currency translation | ( | ) | ( | ) | ( | ) | ||||||||||||||
Balance at February 29, 2020 | ||||||||||||||||||||
Adjustment (1) | ||||||||||||||||||||
Foreign currency translation | ( | ) | ( | ) | ( | ) | ||||||||||||||
Balance at May 30, 2020 | $ | $ | $ | $ | $ | |||||||||||||||
(1) During the quarter ended May 30, 2020, we recorded a $6.3 million increase to goodwill and corresponding increase to deferred tax liabilities to correct an immaterial error related to prior periods. The error was not material to any previously reported annual or interim consolidated financial statements. |
(In thousands) | Gross Carrying Amount | Accumulated Amortization | Foreign Currency Translation | Net | ||||||||||||
May 30, 2020 | ||||||||||||||||
Definite-lived intangible assets: | ||||||||||||||||
Customer relationships | $ | $ | ( | ) | $ | ( | ) | $ | ||||||||
Other intangibles | ( | ) | ( | ) | ||||||||||||
Total definite-lived intangible assets | ( | ) | ( | ) | ||||||||||||
Indefinite-lived intangible assets: | ||||||||||||||||
Trademarks | — | ( | ) | |||||||||||||
Total intangible assets | $ | $ | ( | ) | $ | ( | ) | $ | ||||||||
February 29, 2020 | ||||||||||||||||
Definite-lived intangible assets: | ||||||||||||||||
Customer relationships | $ | $ | ( | ) | $ | ( | ) | $ | ||||||||
Other intangibles | ( | ) | ( | ) | ||||||||||||
Total definite-lived intangible assets | ( | ) | ( | ) | ||||||||||||
Indefinite-lived intangible assets: | ||||||||||||||||
Trademarks | — | ( | ) | |||||||||||||
Total intangible assets | $ | $ | ( | ) | $ | ( | ) | $ |
(In thousands) | Remainder of Fiscal 2021 | Fiscal 2022 | Fiscal 2023 | Fiscal 2024 | Fiscal 2025 | |||||||||||||||
Estimated amortization expense | $ | $ | $ | $ | $ |
6. | Debt |
Three Months Ended | ||||||||
(In thousands) | May 30, 2020 | June 1, 2019 | ||||||
Operating lease cost | $ | $ | ||||||
Short-term lease cost | ||||||||
Variable lease cost | ||||||||
Total lease cost | $ | $ |
Three Months Ended | ||||||||
(In thousands except weighted-average data) | May 30, 2020 | June 1, 2019 | ||||||
Cash paid for amounts included in the measurement of operating lease liabilities | $ | $ | ||||||
Lease assets obtained in exchange for new operating lease liabilities | $ | $ | ||||||
Weighted-average remaining lease term - operating leases | ||||||||
Weighted-average discount rate - operating leases | % | % |
(In thousands) | May 30, 2020 | |||
Remainder of Fiscal 2021 | $ | |||
Fiscal 2022 | ||||
Fiscal 2023 | ||||
Fiscal 2024 | ||||
Fiscal 2025 | ||||
Fiscal 2026 | ||||
Thereafter | ||||
Total lease payments | ||||
Less: Amounts representing interest | ( | ) | ||
Present value of lease liabilities | $ |
8. | Commitments and Contingent Liabilities |
Three Months Ended | ||||||||
(In thousands) | May 30, 2020 | June 1, 2019 | ||||||
Balance at beginning of period | $ | $ | ||||||
Additional accruals | ||||||||
Claims paid | ( | ) | ( | ) | ||||
Balance at end of period | $ | $ |
Inception date | Termination date | Proceeds received | Deferred costs | Net benefit | ||||||||||
November 2013 | October 2020 | $ | $ | $ | ||||||||||
June 2016 | May 2023 | |||||||||||||
August 2018 | July 2025 | |||||||||||||
September 2018 | August 2025 | |||||||||||||
Total | $ | $ | $ |
9. | Share-Based Compensation |
Stock options and SARs | Number of Shares | Weighted Average Exercise Price | Weighted Average Remaining Contractual Life | Aggregate Intrinsic Value | |||||||||
Outstanding at February 29, 2020 | $ | ||||||||||||
Awards exercised | |||||||||||||
Outstanding and exercisable at May 30, 2020 | $ | $ |
Nonvested shares and units | Number of Shares and Units | Weighted Average Grant Date Fair Value | |||||
Nonvested at February 29, 2020 | $ | ||||||
Granted | |||||||
Vested | ( | ) | |||||
Nonvested at May 30, 2020 | $ |
10. | Income Taxes |
11. | Earnings per Share |
Three Months Ended | ||||||
(In thousands) | May 30, 2020 | June 1, 2019 | ||||
Basic earnings per share – weighted average common shares outstanding | ||||||
Weighted average effect of nonvested share grants and assumed exercise of stock options | ||||||
Diluted earnings per share – weighted average common shares and potential common shares outstanding | ||||||
Stock awards excluded from the calculation of earnings per share because the effect was anti-dilutive (award price greater than average market price of the shares) |
12. | Segment Information |
• | The Architectural Framing Systems segment designs, engineers, fabricates and finishes the aluminum frames used in customized aluminum and glass window, curtainwall, storefront and entrance systems comprising the outside skin and entrances of commercial, institutional and high-end multi-family residential buildings. The Company has aggregated |
• | The Architectural Glass segment fabricates coated, high-performance glass used in customized window and wall systems comprising the outside skin of commercial, institutional and high-end multi-family residential buildings. |
• | The Architectural Services segment designs, engineers, fabricates and installs the walls of glass, windows and other curtainwall products making up the outside skin of commercial and institutional buildings. |
• | The LSO segment manufactures value-added glass and acrylic products primarily for framing and display applications. |
Three Months Ended | ||||||||
(In thousands) | May 30, 2020 | June 1, 2019 | ||||||
Net sales from operations | ||||||||
Architectural Framing Systems | $ | $ | ||||||
Architectural Glass | ||||||||
Architectural Services | ||||||||
Large-Scale Optical | ||||||||
Intersegment eliminations | ( | ) | ( | ) | ||||
Net sales | $ | $ | ||||||
Operating income (loss) from operations | ||||||||
Architectural Framing Systems | $ | $ | ||||||
Architectural Glass | ( | ) | ||||||
Architectural Services | ||||||||
Large-Scale Optical | ( | ) | ||||||
Corporate and other | ( | ) | ( | ) | ||||
Operating income | $ | $ |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
Three Months Ended | |||||
May 30, 2020 | June 1, 2019 | ||||
Net sales | 100.0 | % | 100.0 | % | |
Cost of sales | 79.2 | 77.2 | |||
Gross profit | 20.8 | 22.8 | |||
Selling, general and administrative expenses | 18.6 | 16.3 | |||
Operating income | 2.2 | 6.5 | |||
Interest and other expense, net | 0.9 | 0.7 | |||
Earnings before income taxes | 1.4 | 5.7 | |||
Income tax expense | 0.4 | 1.4 | |||
Net earnings | 1.0 | % | 4.3 | % | |
Effective tax rate | 28.2 | % | 24.4 | % |
Three Months Ended | |||||||||||
(In thousands) | May 30, 2020 | June 1, 2019 | % Change | ||||||||
Net sales | $ | 150,164 | $ | 180,522 | (16.8 | )% | |||||
Operating income | 7,296 | 12,273 | (40.6 | )% | |||||||
Operating margin | 4.9 | % | 6.8 | % |
Three Months Ended | |||||||||||
(In thousands) | May 30, 2020 | June 1, 2019 | % Change | ||||||||
Net sales | $ | 76,911 | $ | 100,291 | (23.3 | )% | |||||
Operating income | (494 | ) | 6,399 | N/M | |||||||
Operating margin | (0.6 | )% | 6.4 | % |
Three Months Ended | |||||||||||
(In thousands) | May 30, 2020 | June 1, 2019 | % Change | ||||||||
Net sales | $ | 63,551 | $ | 65,147 | (2.4 | )% | |||||
Operating income | 5,343 | 4,573 | 16.8 | % | |||||||
Operating margin | 8.4 | % | 7.0 | % |
Three Months Ended | |||||||||||
(In thousands) | May 30, 2020 | June 1, 2019 | % Change | ||||||||
Net sales | $ | 6,312 | $ | 21,259 | (70.3 | )% | |||||
Operating income | (3,132 | ) | 4,177 | N/M | |||||||
Operating margin | (49.6 | )% | 19.6 | % |
Selected cash flow data | Three Months Ended | |||||||
(In thousands) | May 30, 2020 | June 1, 2019 | ||||||
Operating Activities | ||||||||
Net cash provided by operating activities | $ | 23,976 | $ | (9,742 | ) | |||
Investing Activities | ||||||||
Capital expenditures | (8,606 | ) | (11,198 | ) | ||||
Financing Activities | ||||||||
Borrowings on line of credit | 139,500 | 103,000 | ||||||
Payments on line of credit | (146,500 | ) | (55,500 | ) | ||||
Repurchase and retirement of common stock | (4,731 | ) | (20,010 | ) | ||||
Dividends paid | (4,872 | ) | (4,598 | ) |
Payments Due by Fiscal Period | ||||||||||||||||||||||||||||
(In thousands) | Remainder of Fiscal 2021 | Fiscal 2022 | Fiscal 2023 | Fiscal 2024 | Fiscal 2025 | Thereafter | Total | |||||||||||||||||||||
Debt obligations | $ | 5,400 | $ | 152,000 | $ | 1,000 | $ | — | $ | 40,500 | $ | 12,000 | $ | 210,900 | ||||||||||||||
Operating leases (undiscounted) | 9,168 | 10,933 | 10,070 | 8,090 | 6,256 | 11,386 | 55,903 | |||||||||||||||||||||
Purchase obligations | 146,927 | 29,868 | 277 | 127 | — | — | 177,199 | |||||||||||||||||||||
Total cash obligations | $ | 161,495 | $ | 192,801 | $ | 11,347 | $ | 8,217 | $ | 46,756 | $ | 23,386 | $ | 444,002 |
Item 3. | Quantitative and Qualitative Disclosures About Market Risk |
Item 4. | Controls and Procedures |
a) | Evaluation of disclosure controls and procedures: As of the end of the period covered by this report (the Evaluation Date), we carried out an evaluation, under the supervision and with the participation of management, including the Chief Executive Officer and the Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) of the Securities Exchange Act of 1934, as amended (the Exchange Act)). Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that, as of the Evaluation Date, our disclosure controls and procedures were effective to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in applicable rules and forms, and (ii) accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure. |
b) | Changes in internal controls: There was no change in the Company’s internal control over financial reporting that occurred during the fiscal quarter ended May 30, 2020, that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting. |
Item 1. | Legal Proceedings |
Item 1A. | Risk Factors |
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds |
Period | Total Number of Shares Purchased (a) | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (b) | Maximum Number of Shares that May Yet Be Purchased under the Plans or Programs (b) | |||||||||
March 1, 2020 to March 28, 2020 | 234,272 | $ | 21.72 | 231,492 | 2,063,596 | ||||||||
March 29, 2020 to April 25, 2020 | 2,590 | 18.83 | — | 2,063,596 | |||||||||
April 26, 2020 to May 30, 2020 | 20,133 | 20.48 | — | 2,063,596 | |||||||||
Total | 256,995 | $ | 20.86 | 231,492 | 2,063,596 |
(a) | The shares in this column represent the total number of shares that were repurchased by us pursuant to our publicly announced repurchase program, plus the shares surrendered to us by plan participants to satisfy withholding tax obligations related to share-based compensation. |
(b) | In fiscal 2004, announced on April 10, 2003, the Board of Directors authorized the repurchase of 1,500,000 shares of Company stock. The Board increased the authorization by 750,000 shares, announced on January 24, 2008; by 1,000,000 shares on each of the announcement dates of October 8, 2008, January 13, 2016, January 9, 2018, and January 14, 2020; and by 2,000,000 shares, announced on October 3, 2018. The repurchase program does not have an expiration date. |
Item 6. | Exhibits |
101 | The following materials from Apogee Enterprises, Inc.’s Quarterly Report on Form 10-Q for the quarter ended May 30, 2020 are furnished herewith, formatted in XBRL (Extensible Business Reporting Language): (i) the Consolidated Balance Sheets as of May 30, 2020 and February 29, 2020, (ii) the Consolidated Results of Operations for the three-months ended May 30, 2020 and June 1, 2019, (iii) the Consolidated Statements of Comprehensive Earnings for the three-months ended May 30, 2020 and June 1, 2019, (iv) the Consolidated Statements of Cash Flows for the three-months ended May 30, 2020 and June 1, 2019, (v) the Consolidated Statements of Shareholders' Equity for the three-months ended May 30, 2020 and June 1, 2019, and (vi) Notes to Consolidated Financial Statements. |
104 | Cover Page, formatted as Inline Extensible Business Reporting Language and contained in Exhibit 101. |
APOGEE ENTERPRISES, INC. | |||
Date: July 9, 2020 | By: /s/ Joseph F. Puishys | ||
Joseph F. Puishys President and Chief Executive Officer (Principal Executive Officer) |
Date: July 9, 2020 | By: /s/ Nisheet Gupta | ||
Nisheet Gupta Executive Vice President and Chief Financial Officer (Principal Financial and Accounting Officer) |
• | A two-year cash-based performance award targeted at 180% (90% per year x 2 years) of base salary granted every other year. Fifty percent (50%) of the amount earned will be paid in May following the end of a performance period, and the remaining fifty percent (50%) will be paid approximately one year later. |
• | An annual grant of restricted stock with a target value of 60% of base salary and a potential range of 0% to 200% of target. You will receive your first restricted stock program grant in April or May of 2021. |
• | Apogee medical, dental, life, disability and long-term care insurance |
• | Apogee 401(k) retirement plan |
• | Executive deferred compensation program |
• | Employee stock purchase plan |
• | Flexible spending plan |
• | Executive paid time off program |
• | Annual executive physical of up to $3,000/year |
• | Annual financial planning benefit of up to $2,000/year |
1. | I have reviewed this quarterly report on Form 10-Q of Apogee Enterprises, Inc.; |
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 registrants 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; and |
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. |
/s/ Joseph F. Puishys | |
Joseph F. Puishys President and Chief Executive Officer |
1. | I have reviewed this quarterly report on Form 10-Q of Apogee Enterprises, Inc.; |
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 registrants 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; and |
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. |
/s/ Nisheet Gupta | |
Nisheet Gupta Executive Vice President and Chief Financial Officer |
(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 financial condition and results of operations of the Company. |
/s/ Joseph F. Puishys | |
Joseph F. Puishys President and Chief Executive Officer | |
July 9, 2020 |
(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 financial condition and results of operations of the Company. |
/s/ Nisheet Gupta | |
Nisheet Gupta Executive Vice President and Chief Financial Officer | |
July 9, 2020 |
Consolidated Balance Sheets (unaudited) (Parenthetical) - $ / shares |
May 30, 2020 |
Feb. 29, 2020 |
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Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.33 | $ 0.33 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 26,368,864 | 26,443,166 |
Common stock, shares outstanding | 26,368,864 | 26,443,166 |
Consolidated Results of Operations (unaudited) - USD ($) shares in Thousands, $ in Thousands |
3 Months Ended | |
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May 30, 2020 |
Jun. 01, 2019 |
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Income Statement [Abstract] | ||
Net sales | $ 289,095 | $ 355,365 |
Cost of sales | 228,844 | 274,398 |
Gross profit | 60,251 | 80,967 |
Selling, general and administrative expenses | 53,782 | 57,926 |
Operating income | 6,469 | 23,041 |
Interest and other expense, net | 2,463 | 2,611 |
Earnings before income taxes | 4,006 | 20,430 |
Income tax expense | 1,130 | 4,987 |
Net earnings | $ 2,876 | $ 15,443 |
Earnings per share - basic | ||
Earnings per share - basic | $ 0.11 | $ 0.58 |
Earnings per share - diluted | ||
Earnings per share - diluted | $ 0.11 | $ 0.58 |
Weighted average basic shares outstanding | 26,168 | 26,597 |
Weighted average diluted shares outstanding | 26,418 | 26,843 |
Consolidated Statements of Comprehensive Earnings (unaudited) - USD ($) $ in Thousands |
3 Months Ended | |
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May 30, 2020 |
Jun. 01, 2019 |
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Statement of Comprehensive Income [Abstract] | ||
Net earnings | $ 2,876 | $ 15,443 |
Other comprehensive (loss) earnings: | ||
Unrealized gain on marketable securities, net of $26 and $47 of tax expense, respectively | 97 | 181 |
Unrealized (loss) gain on derivative instruments, net of ($189) and $2 of tax (benefit) expense, respectively | (617) | 5 |
Foreign currency translation adjustments | (6,151) | (2,560) |
Other comprehensive loss | (6,671) | (2,374) |
Total comprehensive (loss) earnings | $ (3,795) | $ 13,069 |
Consolidated Statements of Comprehensive Earnings (Unaudited) (Parenthetical) - USD ($) $ in Thousands |
3 Months Ended | |
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May 30, 2020 |
Jun. 01, 2019 |
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Statement of Comprehensive Income [Abstract] | ||
Tax expense on marketable securities | $ 26 | $ 47 |
Tax (benefit) expense on foreign currency hedge | $ 189 | $ (2) |
Consolidated Statement of Shareholders Equity (unaudited) (Parenthetical) - USD ($) $ in Thousands |
3 Months Ended | |
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May 30, 2020 |
Jun. 01, 2019 |
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Statement of Stockholders' Equity [Abstract] | ||
Tax expense (benefit) on marketable securities | $ 26 | $ 47 |
Tax expense (benefit) on foreign currency hedge | $ 189 | $ (2) |
Summary of Significant Accounting Policies |
3 Months Ended |
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May 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of presentation The consolidated financial statements of Apogee Enterprises, Inc. (we, us, our or the Company) have been prepared in accordance with accounting principles generally accepted in the United States. The information included in this Form 10-Q should be read in conjunction with the Company’s Form 10-K for the year ended February 29, 2020. We use the same accounting policies in preparing quarterly and annual financial statements. All adjustments necessary for a fair presentation of quarterly operating results are reflected herein and are of a normal, recurring nature. The results of operations for the three-month period ended May 30, 2020 are not necessarily indicative of the results to be expected for the full year. COVID-19 considerations The ongoing COVID-19 pandemic continues to cause volatility and uncertainty in global markets impacting worldwide economic activity. We have experienced some delays in commercial construction projects and orders as a result of COVID-19. In our Architectural Glass and Architectural Framing segments, orders have been delayed or have slowed, as customers and end markets face some uncertainty and delays in timing of work. In our Architectural Services segment, some construction site closures or project delays have occurred, and job sites have had to adjust to increased physical distancing and health-related precautions. Within our LSO segment, temporary closure of many retail locations resulted in the shutdown of our factories for most of the first quarter, in response to governmental “stay at home” directives. We have also been impacted by quarantine-related absenteeism among our workforce, resulting in labor and capacity constraints at some of our facilities. The extent to which COVID-19 will impact our business will depend on future developments and public health advancements, which are highly uncertain and cannot be predicted with confidence. However, towards the end of our first quarter and into the second quarter, we began to see some early signs of improvement, including the gradual reopening of retailers, moderating project delays and fewer workforce absences. Furthermore, in response to COVID-19, we have implemented a variety of countermeasures to promote the health and safety of our employees during this pandemic, including health screening, physical distancing practices, enhanced cleaning, use of personal protective equipment, business travel restrictions, and remote work capabilities, in addition to quarantine-related paid leave and other employee assistance programs. Adoption of new accounting standards In the current quarter, we adopted the guidance in ASU 2016-13, Measurement of Credit Losses on Financial Instruments. The guidance provides for a new impairment model on financial instruments which is based on expected credit losses, which was applied following a modified retrospective approach. Additionally, the new guidance makes targeted improvements to the impairment model for certain available-for-sale debt securities, including eliminating the concept of "other than temporary" from that model. The portion of the guidance related to available-for-sale debt securities was adopted following a prospective approach. The adoption of this ASU did not have a significant impact on earnings or financial condition. Refer to additional disclosures in Notes 2 and 4. Subsequent events We have evaluated subsequent events for potential recognition and disclosure through the date of this filing and determined that there were no subsequent events that required recognition or disclosure in the consolidated financial statements other than as described in Note 8.
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Revenue, Receivables and Contract Assets and Liabilities |
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Revenue from Contract with Customer [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue, Receivables and Contract Assets and Liabilities | Revenue, Receivables and Contract Assets and Liabilities Revenue The following table disaggregates total revenue by timing of recognition (see Note 12 for disclosure of revenue by segment):
Receivables Receivables reflected in the financial statements represent the net amount expected to be collected. An allowance for credit losses is established based on expected losses. Expected losses are estimated by reviewing individual accounts, considering aging, financial condition of the debtor, recent payment history, current and forecast economic conditions and other relevant factors. Upon billing, aging of receivables is monitored until collection. An account is considered current when it is within agreed upon payment terms. An account is written off when it is determined that the asset is no longer collectible. Retainage on construction contracts represents amounts withheld by our customers on long-term projects until the project reaches a level of completion where amounts are released.
The following table summarizes the activity in the allowance for credit losses:
Contract assets and liabilities Contract assets consist of retainage, costs and earnings in excess of billings and other unbilled amounts typically generated when revenue recognized exceeds the amount billed to the customer. Contract liabilities consist of billings in excess of costs and earnings and other deferred revenue on contracts. Retainage is classified within receivables and deferred revenue is classified within other current liabilities on our consolidated balance sheets. The time period between when performance obligations are complete and when payment is due is not significant. In certain of our businesses that recognize revenue over time, progress billings follow an agreed-upon schedule of values, and retainage is withheld by the customer until the project reaches a level of completion where amounts are released.
The decrease in contract assets was mainly due to a reduction in contract retainage. The change in contract liabilities was due to timing of project activity within our businesses that operate under long-term contracts.
Some of our contracts have an expected duration of longer than a year, with performance obligations extending over that timeframe. Generally, these contracts are in our businesses with long-term contracts which recognize revenue over time. As of May 30, 2020, the transaction price associated with unsatisfied performance obligations was approximately $995.9 million. The performance obligations are expected to be satisfied, and the corresponding revenue to be recognized, over the following estimated time periods:
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Supplemental Balance Sheet Information |
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Inventory Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Balance Sheet Information | Supplemental Balance Sheet Information Inventories
Other current liabilities
Other non-current liabilities
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Financial Instruments |
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Marketable Securities [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Instruments | Financial Instruments Marketable securities Through our wholly-owned insurance subsidiary, Prism Assurance, Ltd. (Prism), we hold the following available-for-sale marketable securities, made up of municipal and corporate bonds:
Prism insures a portion of our general liability, workers’ compensation and automobile liability risks using reinsurance agreements to meet statutory requirements. The reinsurance carrier requires Prism to maintain fixed-maturity investments for the purpose of providing collateral for Prism’s obligations under the reinsurance agreements. The amortized cost and estimated fair values of these bonds at May 30, 2020, by contractual maturity, are shown below. Expected maturities may differ from contractual maturities, as borrowers may have the right to call or prepay obligations with or without penalty.
Derivative instruments In August 2019, we entered into an interest rate swap to hedge exposure to variability in cash flows from interest payments on our floating-rate revolving credit facility. As of May 30, 2020, the interest rate swap contract had a notional value of $65 million. We periodically enter into forward purchase foreign currency cash flow hedge contracts, generally with an original maturity date of less than one year, to hedge foreign currency exchange rate risk. As of May 30, 2020, we held foreign exchange forward contracts with a U.S. dollar notional value of $34.3 million, with the objective of reducing the exposure to fluctuations in the Canadian dollar and the Euro. These derivative instruments are recorded within our consolidated balance sheets within other current assets and liabilities. Gains or losses associated with these instruments are recorded as a component of accumulated other comprehensive income. Fair value measurements Financial assets and liabilities are classified in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement: Level 1 (unadjusted quoted prices in active markets for identical assets or liabilities); Level 2 (observable market inputs, other than quoted prices included in Level 1); and Level 3 (unobservable inputs that cannot be corroborated by observable market data). We do not have any Level 3 financial assets or liabilities.
Money market funds and commercial paper Fair value of money market funds was determined based on quoted prices for identical assets in active markets. Commercial paper was measured at fair value using inputs based on quoted prices for similar securities in active markets. These assets are included within cash and cash equivalents on our consolidated balance sheets. Municipal and corporate bonds Municipal and corporate bonds were measured at fair value based on market prices from recent trades of similar securities and are classified within our consolidated balance sheets as other current or other non-current assets based on maturity date. Cash surrender value of life insurance and deferred compensation Contracts insuring the lives of certain employees who are eligible to participate in certain non-qualified pension and deferred compensation plans are held in trust. Cash surrender value of the contracts is based on performance measurement funds that shadow the deferral investment allocations made by participants in certain deferred compensation plans. Changes in cash surrender value are recorded in other expense. The deferred compensation liability balances are valued based on amounts allocated by participants to the underlying performance measurement funds. Derivative instruments The interest rate swap is measured at fair value using other observable market inputs, based off of benchmark interest rates. Forward foreign exchange contracts are measured at fair value using other observable market inputs, such as quotations on forward foreign exchange points and foreign currency exchange rates. Derivative positions are primarily valued using standard calculations and models that use as their basis readily observable market parameters. Industry standard data providers are our primary source for forward and spot rate information for both interest and currency rates. Nonrecurring fair value measurements Certain assets are measured at fair value on a nonrecurring basis and are subject to fair value adjustments in certain circumstances. These include certain long-lived assets that are written down to estimated fair value when they are determined to be impaired, utilizing a valuation approach incorporating Level 3 inputs.
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Goodwill and Other Identifiable Intangible Assets |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Other Identifiable Intangible Assets | Goodwill and Other Identifiable Intangible Assets The carrying amount of goodwill attributable to each reporting segment was:
We evaluate goodwill for impairment annually at our year-end, or more frequently if events or changes in circumstances indicate the carrying value of the goodwill may not be recoverable. During the first quarter of fiscal 2021, we identified qualitative indicators of impairment, including a significant decline in our stock price and market capitalization, along with concerns resulting from the COVID-19 pandemic at four of our nine identified reporting units. Therefore, we performed a quantitative goodwill impairment evaluation as of May 30, 2020 at these four reporting units, EFCO Corporation ("EFCO"), Alumicor Limited ("Alumicor"), Sotawall Limited ("Sotawall") and Viracon, Inc ("Viracon"). Evaluating goodwill for impairment involves the determination of the fair value of each reporting unit in which goodwill is recorded using a qualitative or quantitative analysis. A reporting unit is an operating segment or a component of an operating segment for which discrete financial information is available and reviewed by management on a regular basis. If the fair value of a reporting unit exceeds the carrying value, goodwill impairment is not indicated. We base our determination of fair value on a discounted cash flow methodology that involves significant judgment and projections of future performance. We also consider a market approach in our analysis by reviewing available data from recent transactions of comparable public companies when available. Assumptions about future revenues and expenses, capital expenditures and changes in working capital are based on the annual operating plan and long-term business plan for each reporting unit. These plans take into consideration numerous factors, including historical experience, current and future operational plans, anticipated future economic conditions and growth expectations for the industries and end markets in which we participate. These plans also take into consideration our assessment of risks inherent in our projections of future cash flows. Due to the inherent uncertainties involved in making estimates and assumptions, actual results may differ from those assumed in the forecasts. Inputs used to estimate these fair values included significant unobservable inputs that reflect the Company's assumptions about the inputs that market participants would use and, therefore, the fair value assessments are classified within Level 3 of the fair value hierarchy. We derived the discount rates using a capital asset pricing model and analyzing published rates for industries relevant to the reporting units to estimate the cost of equity financing. We used discount rates that are commensurate with the risks and uncertainties inherent in the respective businesses and in the internally developed forecasts, updated for recent events. Based on the results of the interim quantitative goodwill impairment analysis, the estimated fair value of each reporting unit exceeded its carrying value and, therefore, goodwill impairment was not indicated as of May 30, 2020. We utilized a discount rate of 11.0 percent in determining the discounted cash flows for EFCO and Alumicor, and a discount rate of 10.4 percent in determining the discounted cash flows for Sotawall and Viracon. We utilized a long-term growth rate of 3.0 percent in our fair value analysis for all reporting units. While these discount rates have increased from the time of our annual goodwill impairment evaluation at year-end, impairment is not indicated at this time due to the long-term future performance expectations for these businesses. The gross carrying amount of other intangible assets and related accumulated amortization was:
We hold intangible assets for certain acquired trade names and trademarks which are determined to have indefinite useful lives. We evaluate the reasonableness of the useful life and test indefinite-lived intangible assets for impairment annually at our year-end, or more frequently if events or changes in circumstances indicate that it is more likely than not that the asset is impaired. During the first quarter of fiscal 2021, we identified qualitative indicators of impairment, including deteriorating macroeconomic conditions resulting from the COVID-19 pandemic. Therefore, we performed an interim impairment evaluation on indefinite-lived intangible assets as of May 30, 2020. If the carrying amount of an indefinite-lived intangible asset exceeds its fair value, an impairment loss is recognized in an amount equal to that excess. If an impairment loss is recognized, the adjusted carrying amount becomes the asset's new accounting basis. Fair value is measured using the relief-from-royalty method. This method assumes the trade name or trademark has value to the extent that the owner is relieved of the obligation to pay royalties for the benefits received from the asset. This method requires us to estimate the future revenue from the related asset, the appropriate royalty rate, and the weighted average cost of capital. The assessment of fair value involves significant judgment and projections about future performance. In determining the discounted future revenue in our fair value analysis, we utilized a discount rate of 11.5 percent for EFCO and Alumicor and a discount rate of 10.9 percent for Sotawall. A royalty rate of 1.5 percent was utilized for Alumicor and EFCO and a royalty rate of 2.0 percent was utilized for Sotawall. We utilized a long-term growth rate of 3.0 percent in the fair value analysis for all reporting units. Based on our analysis, the fair value of each of our trade names and trademarks exceeded its carrying amount and impairment was not indicated. We continue to conclude that the useful life of our indefinite-lived intangible assets is appropriate. If future revenue were to fall below forecasted levels or if market conditions were to decline in a material or sustained manner, due to COVID-19 or otherwise, impairment could be indicated on one or more of our indefinite-lived intangible assets. Amortization expense on definite-lived intangible assets was $1.8 million and $1.9 million for the three-month periods ended May 30, 2020 and June 1, 2019, respectively. Amortization expense of other identifiable intangible assets is included in selling, general and administrative expenses. At May 30, 2020, the estimated future amortization expense for definite-lived intangible assets was:
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Debt |
3 Months Ended |
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May 30, 2020 | |
Debt Disclosure [Abstract] | |
Debt | Debt As of May 30, 2020, we had a committed revolving credit facility with maximum borrowings of up to $235 million, maturing in June 2024, and a $150 million term loan maturing in April 2021. As of May 30, 2020, our total debt outstanding was $210.9 million, compared to $217.9 million as of February 29, 2020. Outstanding borrowings under the revolving credit facility were $40.5 million, as of May 30, 2020, and $47.5 million, as of February 29, 2020. Our revolving credit facility and term loan contain two financial covenants that require us to stay below a maximum debt-to-EBITDA ratio and maintain a minimum ratio of interest expense-to-EBITDA. Both ratios are computed quarterly, with EBITDA calculated on a rolling four-quarter basis. At May 30, 2020, we were in compliance with both financial covenants. Additionally, at May 30, 2020, we had a total of $24.7 million of ongoing letters of credit related to industrial revenue bonds, construction contracts and insurance collateral that expire in fiscal years 2021 to 2032 and reduce borrowing capacity under the revolving credit facility. At May 30, 2020, debt included $20.4 million of industrial revenue bonds that mature in fiscal years 2021 through 2043. The fair value of the industrial revenue bonds approximated carrying value at May 30, 2020, due to the variable interest rates on these instruments. All debt would be classified as Level 2 within the fair value hierarchy described in Note 4. We also maintain two Canadian committed, revolving credit facilities totaling $25.0 million (USD). As of May 30, 2020 and February 29, 2020, no borrowings were outstanding under the facilities. Interest payments were $1.4 million and $2.4 million for the three months ended May 30, 2020 and June 1, 2019, respectively.
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Commitments and Contingent Liabilities |
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Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingent Liabilities | Commitments and Contingent Liabilities Bond commitments In the ordinary course of business, predominantly in our Architectural Services and Architectural Framing Systems segments, we are required to provide surety or performance bonds that commit payments to our customers for any non-performance. At May 30, 2020, $1.0 billion of these types of bonds were outstanding, of which $582.3 million is in our backlog. These bonds do not have stated expiration dates. We have never been required to make payments under surety or performance bonds with respect to our existing businesses. Warranty and project-related contingencies We reserve estimated exposures on known claims, as well as on a portion of anticipated claims, for product warranty and rework cost, based on historical product liability claims as a ratio of sales. Claim costs are deducted from the accrual when paid. Factors that could have an impact on the warranty accrual in any given period include the following: changes in manufacturing quality, changes in product mix and any significant changes in sales volume. A warranty rollforward follows:
Additionally, we are subject to project management and installation-related contingencies as a result of our fixed-price material supply and installation service contracts, primarily in our Architectural Services segment and certain of our Architectural Framing Systems businesses. We manage the risk of these exposures through contract negotiations, proactive project management and insurance coverages. The liability for these types of project-related contingencies was $48.1 million and $49.0 million as of May 30, 2020 and February 29, 2020, respectively. Subsequent to the end of the quarter, in June 2020, we settled contract claims related to a majority of these project-related contingencies on a legacy EFCO project for an amount equal to the contingency recorded at May 30, 2020. Letters of credit At May 30, 2020, we had $24.7 million of ongoing letters of credit, all of which have been issued under our committed revolving credit facility, as discussed in Note 6. Subsequent to the end of the quarter, in connection with the settlement of contract claims related to a legacy EFCO project referenced above, the original project performance and payment bond was replaced, which required a $25.0 million letter of credit. The letter of credit for the replacement bond was issued outside of our committed revolving credit facility, with no impact on our borrowing capacity and debt covenants. Purchase obligations Purchase obligations for raw material commitments and capital expenditures totaled $177.2 million as of May 30, 2020. New Markets Tax Credit (NMTC) transactions We have entered into four separate NMTC programs to support our operational expansion. Proceeds received from investors on these transactions are included within other current and non-current liabilities on our consolidated balance sheets. The NMTC arrangements are subject to 100 percent tax recapture for a period of seven years from the date of each respective transaction. Therefore, upon the termination of each arrangement, these proceeds will be recognized in earnings in exchange for the transfer of tax credits. The direct and incremental costs incurred in structuring these arrangements have been deferred and are included in other current and non-current assets on our consolidated balance sheets. These costs will be recognized in conjunction with the recognition of the related proceeds on each arrangement. During the construction phase, we are required to hold cash dedicated to fund each capital project which is classified as restricted cash on our consolidated balance sheets. Variable-interest entities, which have been included within our consolidated financial statements, have been created as a result of the structure of these transactions, as investors in the programs do not have a material interest in their underlying economics. The table below provides a summary of our outstanding NMTC transactions (in millions):
Litigation On November 5, 2018, a shareholder filed a purported securities class action against the Company and certain named executive officers. On March 25, 2020, the District Court granted the Company's motion to dismiss without prejudice this matter. On May 5, 2020, the District Court entered final judgment. Plaintiffs’ have waived their right to appeal. The Company views this matter as closed. On December 17, 2018, a different shareholder filed a derivative lawsuit, purportedly on behalf of the Company, against certain of our executive officers and directors claiming breaches of fiduciary duty, waste of corporate assets and unjust enrichment. On May 29, 2020, the parties filed a joint stipulation and order dismissing this matter without prejudice. The Company views this matter as closed. In addition to the foregoing, the Company is a party to various legal proceedings incidental to its normal operating activities. In particular, like others in the construction supply and services industry, the Company is routinely involved in various disputes and claims arising out of construction projects, sometimes involving significant monetary damages or product replacement. The Company is also subject to litigation arising out of areas such as employment practices, workers compensation and general liability matters. Although it is very difficult to accurately predict the outcome of any such proceedings, facts currently available indicate that no matters will result in losses that would have a material adverse effect on the results of operations, cash flows or financial condition of the Company.
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Share-Based Compensation |
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Share-Based Compensation | Share-Based Compensation Total share-based compensation expense included in the results of operations was $1.4 million for the three-month period ended May 30, 2020 and $1.6 million for the three-month period ended June 1, 2019. Stock options and SARs Stock option and SAR activity for the current three-month period is summarized as follows:
No awards were issued or exercised during the three-months ended May 30, 2020 and June 1, 2019, respectively. Nonvested shares and share units Nonvested share activity for the current three-month period is summarized as follows:
At May 30, 2020, there was $2.7 million of total unrecognized compensation cost related to nonvested share and nonvested share unit awards, which is expected to be recognized over a weighted average period of approximately 26 months. The total fair value of shares vested during the three months ended May 30, 2020 was $1.3 million.
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Income Taxes |
3 Months Ended |
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May 30, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company files income tax returns in the U.S. federal jurisdiction, various U.S. state jurisdictions, Canada, Brazil and other international jurisdictions. The Company is no longer subject to U.S. federal tax examinations for years prior to fiscal 2017, or state and local income tax examinations for years prior to fiscal 2013. The Company is not currently under U.S. federal examination for years subsequent to fiscal year 2016, and there is limited audit activity of the Company’s income tax returns in U.S. state jurisdictions or international jurisdictions. The total liability for unrecognized tax benefits was $4.1 million at May 30, 2020 and at February 29, 2020. Penalties and interest related to unrecognized tax benefits are recorded in income tax expense. The total liability for unrecognized tax benefits is expected to decrease by approximately $0.4 million during the next 12 months due to lapsing of statutes.
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Earnings per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share | Earnings per Share The following table presents a reconciliation of the share amounts used in the computation of basic and diluted earnings per share:
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Segment Information |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information | Segment Information The Company has four reporting segments: Architectural Framing Systems, Architectural Glass, Architectural Services and Large-Scale Optical (LSO).
Due to the varying combinations and integration of individual window, storefront and curtainwall systems, it is impractical to report product revenues generated by class of product, beyond the segment revenues currently reported.
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Leases Leases |
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Leases [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases | Leases We lease certain of the buildings and equipment used in our operations. We determine if an arrangement contains a lease at inception. Currently, all of our lease arrangements are classified as operating leases. We elected the package of practical expedients permitted under the transition guidance in adopting ASC 842, which among other things, allowed us to carry forward our historical lease classification. Operating lease assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term and lease expense is recognized on a straight-line basis over the lease term. Our leases have remaining lease terms of one to ten years, some of which include renewal options that can extend the lease for up to an additional ten years at our sole discretion. We have made an accounting policy election not to record leases with an original term of 12 months or less on our consolidated balance sheet and such leases are expensed on a straight-line basis over the lease term. In determining lease asset value, we consider fixed or variable payment terms, prepayments, incentives, and options to extend, terminate or purchase. Renewal, termination or purchase options affect the lease term used for determining lease asset value only if the option is reasonably certain to be exercised. We use a discount rate for each lease based upon an estimated incremental borrowing rate over a similar term. We have elected the practical expedient to account for lease and nonlease components (e.g., common-area maintenance costs) as a single lease component. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. We are not a lessor in any transactions. The components of lease expense were as follows:
Other supplemental information related to leases was as follows:
Future maturities of lease liabilities are as follows:
As of May 30, 2020, we have $5.7 million additional future operating lease commitments for leases that have not yet commenced.
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Summary of Significant Accounting Policies (Tables) |
3 Months Ended |
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May 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Impact of new accounting guidance | Adoption of new accounting standards In the current quarter, we adopted the guidance in ASU 2016-13, Measurement of Credit Losses on Financial Instruments. The guidance provides for a new impairment model on financial instruments which is based on expected credit losses, which was applied following a modified retrospective approach. Additionally, the new guidance makes targeted improvements to the impairment model for certain available-for-sale debt securities, including eliminating the concept of "other than temporary" from that model. The portion of the guidance related to available-for-sale debt securities was adopted following a prospective approach. The adoption of this ASU did not have a significant impact on earnings or financial condition. Refer to additional disclosures in Notes 2 and 4.
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Revenue, Receivables and Contract Assets and Liabilities (Tables) |
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Revenue from Contract with Customer [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disaggregated revenue data | The following table disaggregates total revenue by timing of recognition (see Note 12 for disclosure of revenue by segment):
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Allowance for Credit Losses | The following table summarizes the activity in the allowance for credit losses:
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Contract assets and liabilities |
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Performance obligations expected to be satisfied | The performance obligations are expected to be satisfied, and the corresponding revenue to be recognized, over the following estimated time periods:
|
Supplemental Balance Sheet Information (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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May 30, 2020 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of inventories | Inventories
|
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Other current liabilities | Other current liabilities
|
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Other non-current liabilities | Other non-current liabilities
|
Financial Instruments (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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May 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Marketable Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Amortized cost, gross unrealized gains and losses, and estimated fair values of investments available for sale | e hold the following available-for-sale marketable securities, made up of municipal and corporate bonds:
|
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Schedule of amortized cost and estimated fair values of investments by contractual maturity | The amortized cost and estimated fair values of these bonds at May 30, 2020, by contractual maturity, are shown below. Expected maturities may differ from contractual maturities, as borrowers may have the right to call or prepay obligations with or without penalty.
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Fair value measurements |
|
Goodwill and Other Identifiable Intangible Assets (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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May 30, 2020 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of goodwill attributable to each business segment | The carrying amount of goodwill attributable to each reporting segment was:
|
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Schedule of finite lived intangible assets | The gross carrying amount of other intangible assets and related accumulated amortization was:
|
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Schedule of estimated future amortization expense for identifiable intangible assets | At May 30, 2020, the estimated future amortization expense for definite-lived intangible assets was:
|
Commitments and Contingent Liabilities (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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May 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Guarantees and warranties | A warranty rollforward follows:
|
Share-Based Compensation (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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May 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Award transactions on stock options | Stock option and SAR activity for the current three-month period is summarized as follows:
|
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Nonvested share award transactions | Nonvested share activity for the current three-month period is summarized as follows:
|
Earnings per Share (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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May 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation of basic and diluted earnings per share | The following table presents a reconciliation of the share amounts used in the computation of basic and diluted earnings per share:
|
Segment Information (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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May 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Sales and operating income data |
|
Leases (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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May 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of lease cost | The components of lease expense were as follows:
Other supplemental information related to leases was as follows:
|
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Schedule of operating lease liability | Future maturities of lease liabilities are as follows:
|
Revenue, Receivables and Contract Assets and Liabilities Revenue (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
May 30, 2020 |
Jun. 01, 2019 |
|
Disaggregation of Revenue [Line Items] | ||
Total | $ 289,095 | $ 355,365 |
Recognized at shipment | ||
Disaggregation of Revenue [Line Items] | ||
Total | 116,163 | 155,265 |
Recognized over time | ||
Disaggregation of Revenue [Line Items] | ||
Total | $ 172,932 | $ 200,100 |
Revenue, Receivables and Contract Assets and Liabilities Accounts Receivable (Details) - USD ($) $ in Thousands |
May 30, 2020 |
Feb. 29, 2020 |
---|---|---|
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total receivables | $ 158,500 | $ 199,275 |
Less: allowance for credit losses | (2,196) | (2,469) |
Net receivables | 156,304 | 196,806 |
Trade accounts | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total receivables | 122,092 | 141,126 |
Construction contracts | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total receivables | 12,630 | 20,808 |
Contract retainage | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total receivables | $ 23,778 | $ 37,341 |
Revenue, Receivables and Contract Assets and Liabilities Allowance for Credit Losses (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
May 30, 2020 |
Feb. 29, 2020 |
|
Credit Loss [Abstract] | ||
Accounts Receivable, Allowance for Credit Loss | $ 2,196 | $ 2,469 |
Additions charged to costs and expenses | 69 | |
Deductions from allowance, net of recoveries | (274) | |
Other changes (1) | $ (68) |
Revenue, Receivables and Contract Assets and Liabilities Contract Assets & Liabilities (Details) - USD ($) $ in Thousands |
May 30, 2020 |
Feb. 29, 2020 |
---|---|---|
Revenue from Contract with Customer [Abstract] | ||
Contract assets | $ 89,757 | $ 110,923 |
Contract liabilities | $ 18,209 | $ 35,954 |
Revenue, Receivables and Contract Assets and Liabilities (Details 4) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
May 30, 2020 |
Jun. 01, 2019 |
|
Revenue from Contract with Customer [Abstract] | ||
Revenue recognized related to contract liabilities from prior year-end | $ 13,011 | $ 14,194 |
Revenue recognized related to prior satisfaction of performance obligations | $ 2,877 | $ 1,949 |
Supplemental Balance Sheet Information - Components of inventories (Details) - USD ($) $ in Thousands |
May 30, 2020 |
Feb. 29, 2020 |
---|---|---|
Inventory Disclosure [Abstract] | ||
Raw materials | $ 38,502 | $ 36,611 |
Work-in-process | 17,221 | 17,520 |
Finished goods | 19,562 | 16,958 |
Total inventories | $ 75,285 | $ 71,089 |
Supplemental Balance Sheet Information - Other current liabilities (Details) - USD ($) $ in Thousands |
May 30, 2020 |
Feb. 29, 2020 |
---|---|---|
Inventory Disclosure [Abstract] | ||
Warranties | $ 12,421 | $ 12,822 |
Accrued project losses | 48,054 | 48,962 |
Property and other taxes | 6,315 | 5,952 |
Accrued self-insurance reserves | 7,343 | 8,307 |
Other | 36,215 | 42,271 |
Total other current liabilities | $ 110,348 | $ 118,314 |
Supplemental Balance Sheet Information - Other non-current liabilities (Details) - USD ($) $ in Thousands |
May 30, 2020 |
Feb. 29, 2020 |
Jun. 01, 2019 |
---|---|---|---|
Inventory Disclosure [Abstract] | |||
Deferred benefit from New Market Tax Credit transactions | $ 15,717 | $ 15,717 | |
Retirement plan obligations | 8,242 | 8,294 | |
Deferred compensation plan | 8,298 | 8,452 | |
Deferred tax liabilities | 13,915 | $ 7,940 | |
Other | 21,324 | 16,459 | |
Total other non-current liabilities | $ 67,496 | $ 56,862 |
Financial Instruments (Details) - USD ($) $ in Thousands |
May 30, 2020 |
Feb. 29, 2020 |
---|---|---|
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | $ 12,595 | |
Estimated Fair Value | 12,993 | |
Municipal and Corporate Bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 12,595 | $ 11,692 |
Gross Unrealized Gains | 403 | 275 |
Gross Unrealized Losses | 5 | 0 |
Estimated Fair Value | $ 12,993 | $ 11,967 |
Financial Instruments (Details 2) $ in Thousands |
May 30, 2020
USD ($)
|
---|---|
Amortized Cost | |
Due within one year | $ 898 |
Due after one year through five years | 7,017 |
Due after five years through 10 years | 3,880 |
Due beyond 15 years | 800 |
Total | 12,595 |
Estimated Fair Value | |
Due within one year | 911 |
Due after one year through five years | 7,255 |
Due after five years through 10 years | 4,019 |
Due beyond 15 years | 808 |
Total | $ 12,993 |
Financial Instruments (Details Textual) - Designated as Hedging Instrument $ in Millions |
May 30, 2020
USD ($)
|
---|---|
Interest Rate Swap [Member] | |
Derivatives, Fair Value [Line Items] | |
Derivative, Notional Amount | $ 65.0 |
Foreign Exchange Forward | |
Derivatives, Fair Value [Line Items] | |
Derivative, Notional Amount | $ 34.3 |
Goodwill and Other Identifiable Intangible Assets (Details 2) $ in Thousands |
May 30, 2020
USD ($)
|
---|---|
Schedule of estimated future amortization expense for identifiable intangible assets | |
Remainder of Fiscal 2021 | $ 5,858 |
Fiscal 2022 | 7,807 |
Fiscal 2023 | 7,716 |
Fiscal 2024 | 7,039 |
Fiscal 2025 | $ 7,111 |
Goodwill and Other Identifiable Intangible Assets (Details Textual) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
May 30, 2020 |
Jun. 01, 2019 |
|
Goodwill and Other Identifiable Intangible Assets (Textual) [Abstract] | ||
Amortization expense on identifiable intangible assets | $ 1.8 | $ 1.9 |
Debt (Details) $ in Millions |
3 Months Ended | ||||
---|---|---|---|---|---|
May 30, 2020
USD ($)
|
Jun. 01, 2019
USD ($)
|
May 30, 2020
CAD ($)
|
May 30, 2020
USD ($)
|
Feb. 29, 2020
USD ($)
|
|
Line of Credit Facility [Line Items] | |||||
Term Loan | $ 150,000,000 | ||||
Interest payments | $ 1,400,000 | $ 2,400,000 | |||
Letter of credit | |||||
Line of Credit Facility [Line Items] | |||||
Debt | 24,700,000 | ||||
Revolving credit facility | |||||
Line of Credit Facility [Line Items] | |||||
Total debt outstanding | 210,900,000 | $ 217,900,000 | |||
Maximum borrowing capacity | $ 25.0 | 235,000,000 | |||
Outstanding borrowings | 40,500,000 | $ 47,500,000 | |||
Industrial Revenue Bonds | |||||
Line of Credit Facility [Line Items] | |||||
Debt | $ 20,400,000 | ||||
Canada | Revolving credit facility | |||||
Line of Credit Facility [Line Items] | |||||
Outstanding borrowings | $ 0.0 |
Commitments and Contingent Liabilities (Details 1) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
May 30, 2020 |
Jun. 01, 2019 |
|
Guarantees and warranties | ||
Balance at beginning of period | $ 15,629 | $ 16,737 |
Additional accruals | 511 | 1,787 |
Claims paid | (939) | (2,771) |
Balance at end of period | $ 15,201 | $ 15,753 |
Commitments and Contingent Liabilities (Details 2) |
3 Months Ended |
---|---|
May 30, 2020
USD ($)
| |
Income Tax Contingency [Line Items] | |
Proceeds received | $ 26,500 |
Deferred costs | 6,800 |
Net benefit | 19,700 |
October 2020 | |
Income Tax Contingency [Line Items] | |
Proceeds received | 10,700 |
Deferred costs | 3,300 |
Net benefit | 7,400 |
May 2023 | |
Income Tax Contingency [Line Items] | |
Proceeds received | 6,000.0 |
Deferred costs | 1,200 |
Net benefit | 4,800 |
July 2025 | |
Income Tax Contingency [Line Items] | |
Proceeds received | 6,600 |
Deferred costs | 1,300 |
Net benefit | 5,300 |
August 2025 | |
Income Tax Contingency [Line Items] | |
Proceeds received | 3,200 |
Deferred costs | 1,000.0 |
Net benefit | $ 2,200 |
Commitments and Contingent Liabilities (Details Textual) - USD ($) $ in Millions |
May 30, 2020 |
Feb. 29, 2020 |
---|---|---|
Commitments and Contingencies Disclosure [Abstract] | ||
Face value of performance bonds | $ 1,000.0 | |
Companies Backlog Related to Sales | 582.3 | |
Line of Credit Facility [Line Items] | ||
Project related liability | 48.1 | $ 49.0 |
Purchase obligations | 177.2 | |
Industrial Revenue Bonds | ||
Line of Credit Facility [Line Items] | ||
Debt | $ 20.4 |
Share-Based Compensation (Details 1) |
3 Months Ended |
---|---|
May 30, 2020
USD ($)
$ / shares
shares
| |
Award transactions on stock options | |
Outstanding, Beginning | shares | 100,341 |
Outstanding, Ending | shares | 100,341 |
Award transactions on stock options, Weighted Average Exercise Price [Roll Forward] | |
Weighted average exercise price, Beginning | $ / shares | $ 8.34 |
Weighted average exercise price, Awards exercised | $ / shares | 0 |
Weighted average exercise price, Ending | $ / shares | $ 8.34 |
Weighted average remaining contractual life, Outstanding | 1 year 3 months 18 days |
Aggregate intrinsic value, Outstanding | $ | $ 1,235,198 |
Deferred Compensation, Share-based Payments [Member] | |
Award transactions on stock options | |
Outstanding shares awards exercised | shares | 0 |
Share-Based Compensation (Details 2) |
3 Months Ended |
---|---|
May 30, 2020
$ / shares
shares
| |
Nonvested share award transactions | |
Nonvested Number, Beginning | shares | 309,259 |
Number of shares, Granted | shares | 182,693 |
Number of shares, Vested | shares | (61,318) |
Nonvested Number, Ending | shares | 430,634 |
Nonvested share award transactions, Weighted Average Grant Date Fair Value [Roll Forward] | |
Weighted average grant date fair value, Beginning | $ / shares | $ 40.58 |
Weighted average grant date fair value, Granted | $ / shares | 18.86 |
Weighted average grant date fair value, Vested | $ / shares | 43.61 |
Weighted average grant date fair value, Ending | $ / shares | $ 30.93 |
Share-Based Compensation (Details Textual) - USD ($) |
3 Months Ended | |
---|---|---|
May 30, 2020 |
Jun. 01, 2019 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based Payment Arrangement, Noncash Expense | $ 1,406,000 | $ 1,618,000 |
Cash proceeds from exercise of stock options | 0 | $ 0 |
Total unrecognized compensation cost related to nonvested share | $ 2,700,000 | |
Restricted Stock [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted average period, Nonvested | 26 months | |
Total fair value of shares vested | $ 1,300,000 |
Share-Based Compensation Share-Based Compensation Non-printing (Details) - USD ($) |
3 Months Ended | |
---|---|---|
May 30, 2020 |
Jun. 01, 2019 |
|
Share-based Payment Arrangement [Abstract] | ||
Proceeds, Issuance of Shares, Share-based Payment Arrangement, Excluding Option Exercised | $ 0 | $ 0 |
Proceeds from Stock Options Exercised | $ 0 | $ 0 |
Income Taxes (Details) $ in Millions |
May 30, 2020
USD ($)
|
---|---|
Income Tax Disclosure [Abstract] | |
Liability for uncertain tax positions, current and noncurrent | $ 4.1 |
Liability for unrecognized tax benefit, expected decrease | $ 0.4 |
Earnings per Share Earnings per Share (Details) - shares shares in Thousands |
3 Months Ended | |
---|---|---|
May 30, 2020 |
Jun. 01, 2019 |
|
Earnings Per Share [Abstract] | ||
Basic earnings per share – weighted average common shares outstanding | 26,168 | 26,597 |
Weighted average effect of nonvested share grants and assumed exercise of stock options | 250 | 246 |
Diluted earnings per share – weighted average common shares and potential common shares outstanding | 26,418 | 26,843 |
Stock awards excluded from the calculation of earnings per share because the effect was anti-dilutive (award price greater than average market price of the shares) | 150 | 104 |
Segment Information Segment Information (Details Textual) |
3 Months Ended |
---|---|
May 30, 2020
Segment
Reportable_Segment
| |
Segment Reporting [Abstract] | |
Number of Reportable Segments | Segment | 4 |
Number of Operating Segments | Reportable_Segment | 6 |
Segment Information (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
May 30, 2020 |
Jun. 01, 2019 |
|
Sales and operating income data | ||
Net sales | $ 289,095 | $ 355,365 |
Operating income (loss) from operations | 6,469 | 23,041 |
Architectural Framing Systems | ||
Sales and operating income data | ||
Net sales | 150,164 | 180,522 |
Operating income (loss) from operations | 7,296 | 12,273 |
Architectural Glass | ||
Sales and operating income data | ||
Net sales | 76,911 | 100,291 |
Operating income (loss) from operations | (494) | 6,399 |
Architectural Services | ||
Sales and operating income data | ||
Net sales | 63,551 | 65,147 |
Operating income (loss) from operations | 5,343 | 4,573 |
Large-Scale Optical | ||
Sales and operating income data | ||
Net sales | 6,312 | 21,259 |
Operating income (loss) from operations | (3,132) | 4,177 |
Intersegment eliminations | ||
Sales and operating income data | ||
Net sales | (7,843) | (11,854) |
Corporate and other | ||
Sales and operating income data | ||
Operating income (loss) from operations | $ (2,544) | $ (4,381) |
Leases (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
May 30, 2020 |
Jun. 01, 2019 |
|
Leases [Abstract] | ||
Operating lease cost | $ 3,561 | $ 3,373 |
Short-term lease cost | 470 | 682 |
Variable lease cost | 747 | 713 |
Total lease cost | $ 4,778 | $ 4,768 |
Leases (Details 1) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
May 30, 2020 |
Jun. 01, 2019 |
|
Leases [Abstract] | ||
Cash paid for amounts included in the measurement of operating lease liabilities | $ 3,327 | $ 3,300 |
Lease assets obtained in exchange for new operating lease liabilities | $ 158 | $ 706 |
Weighted-average remaining lease term - operating leases | 5 years 9 months 18 days | 5 years 6 months |
Weighted-average discount rate - operating leases | 3.60% | 3.74% |
Leases (Details 2) $ in Thousands |
May 30, 2020
USD ($)
|
---|---|
Leases [Abstract] | |
Remainder of Fiscal 2021 | $ 9,168 |
Fiscal 2022 | 10,933 |
Fiscal 2023 | 10,070 |
Fiscal 2024 | 8,090 |
Fiscal 2025 | 6,256 |
Fiscal 2026 | 5,008 |
Thereafter | 6,378 |
Total lease payments | 55,903 |
Less: Amounts representing interest | (4,627) |
Lessee, Operating Lease, Lease Not Yet Commenced, Undiscounted Amount | 5,700 |
Present value of lease liabilities | $ 51,276 |
Leases Textual (Details) $ in Millions |
May 30, 2020
USD ($)
|
---|---|
Leases [Abstract] | |
Lessee, Operating Lease, Lease Not Yet Commenced, Undiscounted Amount | $ 5.7 |
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