Each of the terms the "Company," "we," "our," "us" and similar terms used herein
refer collectively to Simpson Manufacturing Co., Inc., a Delaware corporation
and its wholly-owned subsidiaries, including Simpson Strong-Tie Company Inc.,
unless otherwise stated. The Company regularly uses its website to post
information regarding its business and governance. The Company encourages
investors to use http://www.simpsonmfg.com as a source of information about the
"Strong-Tie" and our other trademarks appearing in this report are our property.
This report contains additional trade names and trademarks of other companies.
We do not intend our use or display of other companies' trade names or
trademarks to imply an endorsement or sponsorship of us by such companies, or
any relationship with any of these companies.
CAUTIONARY NOTE ABOUT FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A
of the Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"). Forward-looking
statements generally can be identified by words such as "anticipate," "believe,"
"estimate," "expect," "intend," "plan," "target," "continue," "predict,"
"project," "change," "result," "future," "will," "could," "can," "may,"
"likely," "potentially," or similar expressions that concern our strategy,
plans, expectations or intentions. Forward-looking statements include, but are
not limited to, statements about future financial and operating results, our
plans, objectives, business outlook, priorities, expectations and intentions,
expectations for sales growth, comparable sales, earnings and performance,
stockholder value, capital expenditures, cash flows, the housing market, the
home improvement industry, demand for services, share repurchases, our strategic
initiatives, including the impact of these initiatives on our strategic and
operational plans and financial results, and any statement of an assumption
underlying any of the foregoing and other statements that are not historical
facts. Although we believe that the expectations, opinions, projections and
comments reflected in these forward-looking statements are reasonable, such
statements involve risks and uncertainties and we can give no assurance that
such statements will prove to be correct. Actual results may differ materially
from those expressed or implied in such statements.
Forward-looking statements are subject to inherent uncertainties, risk and other
factors that are difficult to predict and could cause our actual results to vary
in material respects from what we have expressed or implied by these
forward-looking statements. Important factors that could cause our actual
results and financial condition to differ materially from those expressed in our
forward looking statements include, among others, those discussed under the Item
1A. Risk Factors and Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations in the 2020 Form 10-K. Additional risks
include: the cyclicality and impact of general economic conditions? changing
conditions in global markets including the impact of sanctions and tariffs,
quotas and other trade actions and import restrictions? the impact of pandemics,
epidemics or other public health emergencies, such as the recent outbreak of
coronavirus disease 2019 (COVID-19)? volatile supply and demand conditions
affecting prices and volumes in the markets for both our products and raw
materials we purchase? the impact of foreign currency fluctuations? potential
limitations on our ability to access capital resources and existing credit
facilities? restrictions on our business and financial covenants under our bank
credit agreement? and reliance on employees subject to collective bargaining
We caution that you should not place undue reliance on these forward-looking
statements, which speak only as of the date of this report. We undertake no
obligation to publicly update any forward-looking statement, whether as a result
of new information, future developments or otherwise. Readers are urged to
carefully review and consider the various disclosures made by us in this report
and in our other reports filed with the SEC that advise of the risks and factors
that may affect our business.
We design, manufacture and sell building construction products that are of high
quality and performance, easy to use and cost-effective for customers. We
operate in three business segments determined by geographic region: North
America, Europe and Asia/Pacific.
At our March 23, 2021 virtual analyst and investor day, we unveiled several key
growth initiatives that we believe will help us continue our track record of
above market growth through a combination of organic and inorganic
opportunities. Our organic opportunities are focused on expansion into new
markets within our core competencies of wood and concrete products. These growth
initiatives will focus on the original equipment manufacturers, repair and
remodel or do-it-yourself, mass timber, concrete and structural steel markets.
In order to grow in these markets, we aspire to be among the leaders in
engineered load-rated construction building products and systems and
customer-facing technology while leveraging our engineering expertise,
deep-rooted relationships with top builders, engineers, contractors, code
officials and distributors, along with our ongoing commitment to testing,
research and innovation. Importantly, we currently have existing products,
testing results, distribution and manufacturing capabilities for all five of our
growth initiatives. It is also important to note that these initiatives are all
currently in different stages of development. Our successful growth in these
areas will ultimately be a function of expanding our sales and/or marketing
functions to promote our products to different end users and distribution
channels, expanding our customer base, and potentially introducing new products
in the future.
Also during the virtual analyst and investor day, we highlighted our Five-year
Ambitions, which are as follows:
1.strengthen our values-based culture;
2.be the business partner of choice;
3.strive to be an innovative leader in our product categories;
4.continue above market growth relative to the U.S. housing starts;
5.remain within the top quartile of our proxy peers for operating income
6.remain in the top quartile of our proxy peers for return on invested capital.
As with our growth initiatives, further updates will be forthcoming related to
material developments with our Five-year Ambitions.
A novel strain of coronavirus ("COVID-19") surfaced in late 2019 and has spread
around the world, including to the United States. In March 2020, the World
Health Organization declared COVID-19 a worldwide pandemic and the President of
the United States declared the COVID-19 outbreak a national emergency. As of
April 30, 2021, the virus continues to spread and has had a significant impact
on worldwide economic activity and on macroeconomic conditions. Vaccines are
available in various countries and distribution of the vaccine also varies by
country and in the U.S. by state. The duration and severity of its effects are
Government authorities in the countries and states where we operate have issued
various and differing shelter in place, stay at home, social distancing
guidelines and other measures in response to the COVID-19 pandemic. In many of
those locations our operations are classified as an essential business and we
continue to operate our business in compliance with applicable state and local
laws and are observing recommended CDC guidelines to minimize the risk of
spreading the COVID-19 virus. We have undertaken numerous steps and instituted
additional precautions to protect our employees, suppliers and customers, as
their safety and well-being is one of our top priorities, and to comply with
health and safety guidelines, including enhanced deep cleaning, staggered
shifts, temperature checking, use of face masks, practicing social distancing
and limiting non-employees at our locations, amongst other safety related
policies and procedures. Many of our office workers in our manufacturing and
distribution facilities, as well as the corporate headquarters, continue to work
remotely, where possible
The Company's management team continues to monitor and manage its ability to
operate effectively and, to date, the Company has not experienced any
significant disruptions within its supply chain. Our supply chain partners have
been very supportive and continue to do their part to ensure that service levels
to our customers remain strong and, to date, we have not experienced any
supply-chain disruptions related to COVID-19 and have been able to meet our
customers' needs. We will continue to communicate with our supply chain partners
to identify and mitigate risk and to manage inventory levels.
In response to the COVID-19 pandemic the Company proactively took measures to
maintain and preserve its strong financial position and flexibility. Based on
updated expectations, the Company resumed hiring to meet increased demand levels
that it has experienced. The Crisis Management Team, which includes members of
senior management, meets regularly to review and assess the status of the
Company's operations and the health and safety of its employees. Notwithstanding
the Company's continued efforts, as the COVID-19 pandemic continues, health
concern risks remain, and we cannot predict whether we or any of our suppliers
will experience disruptions, or how long such disruptions would last. It also
remains unclear how various national, state, and local governments will react if
the distribution of vaccines is slower than expected or new variants of the
virus become more dominant.
A significant portion of the Company's total product sales is dependent on U.S.
housing starts and its business, financial condition, and results of operations
depends significantly on the level of housing and residential construction
activity. We anticipated previously that housing starts would continue to grow
at slow pace as in prior years. However, single-family housing starts increased
significantly from prior-year's level of starts. The return of Lowe's and a
strong home repair and
remodel market also contributed to increased demand and a significant increase
in sales during the first quarter of 2021 compared to the 2020. While we believe
demand will remain strong in the short-term, and factoring in recently announced
sales price increases, will result in higher net sales in future periods.
However, our sales in the first quarter 2021 and a significant portion of 2020
were positively impacted by the return of Lowe's. The remaining quarters of this
fiscal year and the comparable periods of 2020 will include the return of Lowes
and, as a result, we don't think sales volumes for the remainder of 2021 will
grow at the same year-over-year rate as the first quarter of 2021 compared to
the first quarter of 2020. In the short-term, operating profits are expected to
improve on increased selling prices and lower average material costs as higher
costs of raw material purchases are absorbed into current product costs.
However, increased steel costs, product sourcing logistic complications and
potential increases in US income tax rates could result in lower operating and
net income margins by the end of 2021.
Management continues to monitor the impact of the global situation on its
financial condition, liquidity, operations, suppliers, industry, and workforce.
Factors Affecting Our Results of Operations
Unlike lumber or other products that have a more direct correlation to U.S.
housing starts, our products are used to a greater extent in areas that are
subject to natural forces, such as seismic or wind events. Our products are
generally used in a sequential process that follows the construction process.
Residential and commercial construction begins with the foundation, followed by
the wall and the roof systems, and then the installation of our products, which
flow into a project or a house according to these schedules.
Our sales also tend to be seasonal, with operating results varying from quarter
to quarter. With some exceptions, our sales and income have historically been
lower in the first and fourth quarters than in the second and third quarters of
a fiscal year, as our customers tend to purchase construction materials in the
late spring and summer months for the construction season. Weather conditions,
such as extended cold or wet weather, which affect and sometimes delay
installation of some of our products, could negatively affect our results of
operations. Political, economic events such as tariffs and the possibility of
additional tariffs on imported raw materials or finished goods or such as labor
disputes can also have an effect on our gross and operating profits as well as
the amount of inventory on-hand. Our operations can also be affected by a
volatile steel market. Changes in raw material cost could negatively affect our
gross profit margins depending on the timing of raw material purchases or how
much sales prices can be increased to offset higher raw material costs.
Our operations expose us to risks associated with pandemics, epidemics or other
public health emergencies, such as the COVID-19 pandemic which spread from China
to many other countries including the U.S.
In July 2016, our Board of Directors approved a plan to replace our current
in-house enterprise resource planning ("ERP") and externally sourced accounting
platforms with a fully integrated ERP platform from SAP America, Inc. ("SAP") in
multiple phases by location at all facilities plus our headquarters, with a
focus on configuring, instead of customizing, the standard SAP modules.
We went live with our first wave of the SAP implementation project in February
of 2018, and completed implementation at our North America operations in 2021.
We expect to complete the company-wide SAP implementation during 2022. Meeting
the goal is highly dependent on the lifting of current travel restrictions,
which are the result of the COVID-19 pandemic. While we believe the SAP
implementation will be beneficial to the Company over time, annual operating
expenses have and are expected to continue to increase through 2024 as a result
of the SAP implementation, primarily due to increases in training costs and the
depreciation of previously capitalized costs.
Business Segment Information
Historically our North America segment has generated more revenues from wood
construction products compared to concrete construction products. During the
first three months of 2021, the return of Lowe's, favorable weather, increased
home improvement activity and increased housing starts resulted in higher sales
volumes over the same time period of 2020. Our wood construction product net
sales increased 22.4% for the quarter ended March 31, 2021 compared to March 31,
2020, primarily due to increased sales volumes in connection with the return of
Lowe's and increased housing starts and repair and remodel activity, which
resulted in increased sales to some of our other distribution channels. Our
concrete construction product
net sales increased 9.6% for the quarter ended March 31, 2021 compared to
March 31, 2020, primarily due to higher sales volumes. Operating profits
increased due to higher sales, lower cost of goods sold, mostly due to lower
labor and factory costs, partly offset by higher operating expenses including
primarily stock-based compensation expense. If current economic conditions
continue and factoring in recently announced sales price increases, we believe
North America operating margins could be higher in 2021 compared to 2020.
However, increased steel costs and product sourcing complications could result
in lower operating margins towards the end of 2021 or early 2022.
Our Europe segment also generates more revenues from wood construction products
than concrete construction products. Europe net sales increased for the quarter
ended March 31, 2021 compared to March 31, 2020, primarily due to higher sales
volumes in local currency and were positively affected by approximately $3.6
million in foreign currency translation related to Europe's currencies
strengthening against the United States dollar. Wood construction product sales
increased 37.8% for the quarter ended March 31, 2021 compared to March 31, 2020.
Concrete construction product sales are mostly project based, and net sales
increased 20.6% for the quarter ended March 31, 2021 compared to March 31, 2020.
Gross margins increased, mostly due to lower factory, warehouse and shipping
costs, partly offset by higher material costs. Operating expenses increased,
primarily due to higher cash profit sharing and stock-based compensation
expense. If current economic conditions continue and factoring in recently
announced sales price increases, we believe Europe operating margins could be
higher in 2021 compared to 2020. However, increased steel costs and product
sourcing complications could offset sales price increases, negatively affecting
operating margins towards the end of 2021 or early 2022.
Our Asia/Pacific segment has generated revenues from both wood and concrete
construction products. We believe that the Asia/Pacific segment is not
significant to our overall performance.
On February 8, 2021, the Company provided a full-year outlook. The Company is
updating its full year outlook, primarily reflecting one quarter of actual
results, as well as improved visibility on the progression of pandemic-related
restrictions and the impact of those restrictions on the Company's operations.
Based on business trends and conditions as of today, April 26, the Company's
outlook for the full fiscal year ending December 31, 2021 is as follows:
•Operating margin is estimated to be in the range of 19.5% to 22.0%.
•The effective tax rate is estimated to be in the range of 25.0% to 26.0%,
including both federal and state income tax rates.
•Capital expenditures are estimated to be in the range of $50 million to $55
Results of Operations for the Three Months Ended March 31, 2021, Compared with
the Three Months Ended March 31, 2020
Unless otherwise stated, the below results, when providing comparisons (which
are generally indicated by words such as "increased," "decreased," "unchanged"
or "compared to"), compare the results of operations for the three months ended
March 31, 2021, against the results of operations for the three months ended
March 31, 2020. Unless otherwise stated, the results announced below, when
referencing "both quarters," refer to the three months ended March 31, 2020 and
the three months ended March 31, 2021.
First Quarter 2021 Consolidated Financial Highlights
The following table illustrates the differences in our operating results for the
three months ended March 31, 2021, from the three months ended March 31, 2020,
and the increases or decreases for each category by segment:
Three Months Three Months
Ended Increase (Decrease) in Operating Segment Ended
March 31, North Asia/ Admin & March 31,
(in thousands) 2020 America Europe Pacific All Other 2021
Net sales $ 283,668 $ 51,514 $ 11,564 $ 896 $ - $ 347,642
Cost of sales 154,002 24,479 7,015 (181) 45 185,360
Gross profit 129,666 $ 27,035
$ 4,549 $ 1,077 (45) 162,282
Research and development and other engineering
13,382 1,104 54 51 - 14,591
Selling expense 28,527 2,090 139 65 2 30,823
General and administrative expense 38,471 7,951 378 6 1,759 48,565
Total operating expenses 80,380 11,145 571 122 1,761 93,979
Net loss (gain) on disposal of assets (64) 41 17 (74) - (80)
Income from operations 49,350 15,849 3,961 1,029 (1,806) 68,383
Interest income (expense), net and other (2,533) (383) 1,735 83 (680) (1,778)
Income before income taxes 46,817 15,466 5,696 1,112 (2,486) 66,605
Provision for income taxes 9,991 5,640 891 203 (507) 16,218
Net income $ 36,826 $ 9,826 $ 4,805 $ 909 $ (1,979) $ 50,387
Net sales increased 22.6% to $347.6 million from $283.7 million primarily due to
increases in sales volumes. Wood construction product net sales, including sales
of connectors, truss plates, fastening systems, fasteners and shearwalls,
represented 86.7% and 85.5% of the Company's total net sales in the first
quarters of 2021 and 2020, respectively. Concrete construction product net
sales, including sales of adhesives, chemicals, mechanical anchors, powder
actuated tools and reinforcing fiber materials, represented 13.1% and 14.5% of
the Company's total net sales in the first quarters of 2021 and 2020,
Gross profit increased 25.2% to $162.3 million from $129.7 million. Gross
margins increased to 46.7% from 45.7%, primarily due to lower factory and labor,
partly offset by higher material costs each as a percentage of net sales. Gross
margins, including some inter-segment expenses, which were eliminated in
consolidation, and excluding other expenses that are allocated according to
product group, increased to 46.6% from 45.3% for wood construction products and
decreased to 42.5% from 44.2% for concrete construction products, respectively.
Research and development and engineering expense increased 9.0% to $14.6 million
from $13.4 million, primarily due to increases of $0.6 million in personnel
costs, $0.3 million in professional fees and $0.2 million in patent expense,
partly offset by $0.2 million reduction in travel-associated costs.
Selling expense increased 8.0% to $30.8 million from $28.5 million, primarily
due to increases of $1.5 million in stock-based compensation, $0.9 million in
personnel costs, and $0.8 million in professional fees, partly offset by
decreases of $0.8 million in travel-associated expenses.
General and administrative expense increased 26.2% to $48.6 million from $38.5
million, primarily due to increases of $5.0 million in stock-based compensation
expense, $2.4 million in professional fees, $2.1 million in personnel costs, and
$0.9 million in amortization and depreciation expense, partly offset by a
decrease of $0.7 million in travel-associated expenses. Included in general and
administrative expense are SAP implementation and support costs of $3.3 million,
which increased $0.7 million from the prior quarter.
Our effective income tax rate increased to 24.3% from 21.3%, primarily due to
lower windfall tax benefits on the vesting of restricted stock units during the
first quarter of 2021 compared to 2020.
Consolidated net income was $50.4 million compared to $36.8 million. Diluted net
income per common share was $1.16 compared to $0.83.
The following table represents net sales by segment for the three-month periods
ended March 31, 2021 and 2020, respectively:
(in thousands) America Europe Pacific Total
Three months ended
March 31, 2020 $ 249,050 $ 32,732 $ 1,886 $ 283,668
March 31, 2021 300,564 44,296 2,782 347,642
Increase $ 51,514 $ 11,564 $ 896 $ 63,974
Percentage increase 20.7 % 35.3 % 47.5 % 22.6 %
The following table represents segment net sales as percentages of total net
sales for the three-month periods ended March 31, 2021 and 2020, respectively:
America Europe Pacific Total
Percentage of total 2020 net sales 88 % 12 % - %
Percentage of total 2021 net sales 87 % 13 % - % 100 %
The following table represents gross profit by segment for the three-month
periods ended March 31, 2021 and 2020, respectively:
North Asia/ Admin &
(in thousands) America Europe Pacific All Other Total
Three months ended
March 31, 2020 $118,795 $10,701 $167 $3 $129,666
March 31, 2021 145,830 15,250 1,244 (42) 162,282
Increase $27,035 $4,549 $1,077 $(45) $32,616
Percentage Increase 22.8% 42.5% * * 25.2%
* The statistic is not meaningful or material.
The following table represents gross profit as a percentage of sales by segment
for the three months ended March 31, 2021 and 2020, respectively:
North Asia/ Admin &
America Europe Pacific All Other Total
2020 gross profit percentage 47.7 % 32.7 % 8.9 % * 45.7 %
2021 gross profit percentage 48.5 % 34.4 % 44.7 % * 46.7 %
* The statistic is not meaningful or material.
•Net sales increased 20.7%, primarily due to higher sales volumes from the
return of Lowe's and increased repair and remodel activity, as well as from
other distribution channels, which also benefited from increases in new housing
starts and repair and remodel activity. Canada's net sales also increased
primarily due to higher sales volumes and were positively impacted by
approximately $0.8 million in foreign currency translation.
•Gross profit as a percentage of net sales increased to 48.5% from 47.7%,
primarily due to lower labor, factory, warehouse and freight costs, each as a
percentage of net sales, partly offset by higher material costs as a percentage
of net sales.
•Research, development and engineering expenses increased 9.0%, primarily due to
increases of $0.5 million in personnel costs and $0.3 million in professional
fees, and $0.2 million in patent costs.
•Selling expense increased 9.1%, primarily due to increases of $1.8 million in
personnel costs, $1.5 million in stock-based compensation, and $0.7 million in
professional fees, offset by decreases of $2.0 million in travel-associated
•General and administrative expense increased 26.6%, primarily due to increases
of $3.5 million in stock-based compensation expense, $2.8 million for
professionallegal fees, $1.4 million in personnel costs, $0.9 million in
depreciation and amortization, partly offset by a decrease of $0.5 million in
•Income from operations increased by $15.8 million, primarily due to increased
gross profit, partly offset by higher operating expenses.
•Net sales increased 35.3%, primarily due to higher sales volumes and were
positively affected by approximately $3.6 million in foreign currency
translation related to Europe's currencies strengthening against the United
•Gross profit as a percentage of net sales decreased to 34.4% from 32.7%,
primarily due to lower factory, warehouse and shipping costs, partly offset by
higher material costs, each as a percentage of net sales.
•Income from operations increased by $4.0 million, primarily due to higher gross
•For information about the Company's Asia/Pacific segment, please refer to the
tables above setting forth changes in our operating results for the three months
ended March 31, 2021 and 2020, respectively.
Admin & All Other
•General and administrative expense increased $1.8 million, primarily due to
increases of $0.7 million in cash profit sharing expense, $0.6 million in
stock-based compensation expense, $0.6 million in professional/legal fees, and
$0.4 million in increase personnel costs.
Effect of New Accounting Standards
See "Note 1 Basis of Presentation - Not Yet Adopted Accounting Standards" to the
accompanying unaudited interim condensed consolidated financial statements.
Liquidity and Sources of Capital
The Company is a borrower, and certain domestic subsidiaries are guarantors,
under a revolving credit agreement with Wells Fargo Bank, N.A. as administrative
agent, and certain other lenders, which provides the Company with a $300.0
million revolving line of credit (the "Credit Facility") that expires July 23,
2022, and an irrevocable standby letter of credit in support of various
Our principal uses of liquidity include the costs and expenses associated with
our operations, including financing working capital requirements and continuing
our capital allocation strategy, which includes supporting capital expenditures,
repurchasing the Company's common stock, paying cash dividends, and financing
other investment opportunities over the next twelve months.
As of March 31, 2021, our cash and cash equivalents consisted of deposits and
money market funds held with established national financial institutions. Cash
and cash equivalents of $74.2 million are held in the local currencies of our
operations and could be subject to additional taxation if repatriated to the
United States. The Company is maintaining a permanent reinvestment assertion on
its foreign earnings relative to remaining cash held outside the United States.
The following table presents selected financial information as of March 31,
2021, December 31, 2020 and March 31, 2020, respectively:
At March 31, At December 31, At March 31,
(in thousands) 2021 2020 2020
Cash and cash equivalents $ 257,428 $ 274,639 $ 301,741
Property, plant and equipment, net 255,684 255,184 246,941
Goodwill, intangible assets and other 165,918 165,110 157,527
Working capital less cash and cash
equivalents 336,759 284,439 287,391
The following table provides cash flow indicators for the three-month periods
ended March 31, 2021 and 2020, respectively:
Three Months Ended
(in thousands) 2021 2020
Net cash provided by (used in):
Operating activities $ 17,833 $ 12,725
Investing activities (15,729) (6,234)
Financing activities (15,422) 68,567
Cash flows from operating activities result primarily from our earnings, and are
also affected by changes in operating assets and liabilities which consist
primarily of working capital balances. As a significant portion of our revenues
are derived from manufacturing building construction materials. Our operating
cash flows are subject to seasonality and are cyclically associated with the
volume and timing of construction project starts. For example, trade accounts
receivable is generally at its lowest at the end of the fourth quarter and
increases during the first, second and third quarters.
During the three months ended March 31, 2021, operating activities provided
$17.8 million in cash and cash equivalents, as a result of $50.4 million from
net income and $20.6 million from non-cash adjustments to net income, which
included depreciation and amortization expense and stock-based compensation
expense. Cash provided from net income was partly offset by a decrease of $53.1
million in the net change in operating assets and liabilities, including
increases of $62.7 million in trade accounts receivable, $14.8 million in
inventory and $14.1 million in other current assets, partly offset by increases
of $22.1 million in other current liabilities and $17.3 million in trade
Cash used in investing activities of $15.7 million during the three months ended
March 31, 2021 was mainly for capital expenditures and a $5.3 million investment
in a venture capital fund. Our capital spending in 2019, 2020 and the three
months ended March 31, 2021 was $37.5 million, $37.9 million and $10.5 million,
respectively, which was primarily used for machinery and equipment purchases and
software in development. Based on current information and subject to future
events and circumstances, we expect new capital spending for fiscal year 2021
will be in the $50 million to $55 million range which includes carryover
projects from 2020 that were paused due to COVID-19 concerns. Capital spending
will be primarily for safety needs, equipment replacement and productivity
improvements. At this time only a small amount of capital spending is related to
our growth initiatives.
Cash used in financing activities of $15.4 million during the three months ended
March 31, 2021 consisted primarily of $10.0 million used to pay dividends to our
stockholders and $5.3 million used to pay income taxes on behalf of the
employees for shares withheld with respect to their vested restricted stock
On May 4, 2021, the Board raised the quarterly cash dividend to $0.25 per share,
estimated to be $10.9 million in total. The Company last raised the quarterly
dividend $0.01 per share to $0.23 per share on April 26, 2019. The dividend will
be payable on July 22, 2021, to the Company's stockholders of record on July 1,
As illustrated in the table below, since 2015, the Company has repurchased over
seven-and-a-half million shares of the Company's common stock, which represents
approximately 15.7% of our shares of common stock outstanding at the beginning
of 2015. Including dividends, we have returned cash of $647.8 million, which
represents 69.9% of our total cash flow from operations during the same period.
Number of Shares Cash Paid for Share
Cash paid for
(in thousands) Repurchased Repurchases Dividends Total
January 1 - March 31,
2021 - $ - $ 9,967 $ 9,967
January 1 - December
31, 2020 1,053 $ 76,189 $ 40,400 $ 116,589
January 1 - December
31, 2019 972 60,816 40,258 101,074
January 1 - December
31, 2018 1,955 110,540 39,891 150,431
January 1 - December
31, 2017 1,138 70,000 36,981 106,981
January 1 - December
31, 2016 1,244 53,502 32,711 86,213
January 1 - December
31, 2015 1,339 47,144 29,352 76,496
Total 7,701 $ 418,191 $ 229,560 $ 647,751
As of March 31, 2021, $100.0 million was available for future repurchases of
common stock under our share repurchase authorization (which expires at the end
Off-Balance Sheet Arrangements
We did not have any off-balance sheet arrangements as of March 31, 2021.
Inflation and Raw Materials
We believe that the effect of inflation has not been material in recent years,
as general inflation rates have remained relatively low. However, the cost of
steel, lumber and petroleum products have increased in the last few quarters as
had housing prices on strong demand, especially for new housing compared to a
limited supply. This could have an effect on the general inflation rates in
future quarters. Our main raw material is steel. As such, increased steel prices
may adversely affect our gross profit margin if we cannot recover the higher
costs through price increases in a timely manner.
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