Gibraltar Industries Earnings 2019-09-30

ROCK 10Q Quarterly Report

Balance Sheet	Income Statement	Cash Flow

Comparables ($MM TTM)
Ticker	M Cap	Assets	Liab	Rev	G Profit	Net Inc	EBITDA	EV	G Margin	EV/EBITDA	ROA
GGB	2,145	51,281	25,342	0	0	0	0	2,139			0%
CMC	1,817	3,767	2,203	5,594	734	164	442	3,002	13%	6.8	4%
ROCK	1,272	907	277	1,011	231	59	102	1,190	23%	11.7	6%
MTL	833	317,625	550,820	0	0	0	0	833			0%
AKS	722	4,687	4,211	6,791	0	206	581	2,626	0%	4.5	4%
SXC	574	2,082	1,360	1,532	40	38	148	1,324	3%	9.0	2%
SXCP	531	1,634	1,038	908	32	52	224	1,348	4%	6.0	3%
HAYN	457	588	258	483	60	6	24	435	12%	17.9	1%
IIIN	432	305	56	464	46	17	38	424	10%	11.3	6%
TMST	351	1,180	572	1,524	106	-38	52	330	7%	6.3	-3%

Document

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q



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

For the quarterly period ended September 30, 2019



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

For the transition period from to

Commission File Number 0-22462

GIBRALTAR INDUSTRIES, INC.

(Exact name of Registrant as specified in its charter)



Delaware				16-1445150
(State or incorporation )				(I.R.S. Employer Identification No.)

3556 Lake Shore Road	P.O. Box 2028	Buffalo	New York	14219-0228
(Address of principal executive offices)				(Zip Code)

Registrant’s telephone number, including area code: (716) 826-6500

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



Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, $0.01 par value per share	ROCK	NASDAQ Stock Market

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

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

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



Large accelerated filer	☒	Accelerated filer	☐	Non-accelerated filer	☐	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. ☐

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

As of October 24, 2019, the number of common shares outstanding was: 32,272,420.

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GIBRALTAR INDUSTRIES, INC.

INDEX



		PAGE NUMBER
PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements
	Consolidated Statements of Income for the Three and Nine Months Ended September 30, 2019 and 2018 (unaudited)	3
	Consolidated Statements of Comprehensive Income for the Three and Nine Months Ended September 30, 2019 and 2018 (unaudited)	4
	Consolidated Balance Sheets as of September 30, 2019 (unaudited) and December 31, 2018	5
	Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2019 and 2018 (unaudited)	6
	Consolidated Statement of Shareholders’ Equity for the Nine Months Ended September 30, 2019 and 2018 (unaudited)	7
	Notes to Consolidated Financial Statements (unaudited)	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	23
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	33
Item 4.	Controls and Procedures	33
PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	33
Item 1A.	Risk Factors	33
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	33
Item 3.	Defaults Upon Senior Securities	33
Item 4.	Mine Safety Disclosures	33
Item 5.	Other Information	33
Item 6.	Exhibits	34
	SIGNATURES	35

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PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

GIBRALTAR INDUSTRIES, INC.

CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except per share data)

(unaudited)



	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Net Sales	$	299,236	$	280,086	$	789,308	$	761,459
Cost of sales	222,658		209,807		605,272		572,359
Gross profit	76,578		70,279		184,036		189,100
Selling, general, and administrative expense	45,158		40,875		115,444		113,579
Income from operations	31,420		29,404		68,592		75,521
Interest expense	17		2,906		2,297		9,305
Other expense (income)	84		522		660		(50		)
Income before taxes	31,319		25,976		65,635		66,266
Provision for income taxes	6,843		6,473		14,901		15,574
Net income	$	24,476	$	19,503	$	50,734	$	50,692

Net earnings per share:
Basic	$	0.75	$	0.61	$	1.57	$	1.59
Diluted	$	0.75	$	0.60	$	1.55	$	1.56
Weighted average shares outstanding:
Basic	32,470		32,115		32,357		31,922
Diluted	32,770		32,571		32,677		32,524

See accompanying notes to consolidated financial statements.

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GIBRALTAR INDUSTRIES, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in thousands)

(unaudited)



	Three Months Ended September 30,					Nine Months Ended September 30,
	2019			2018		2019		2018
Net income	$	24,476		$	19,503	$	50,734	$	50,692
Other comprehensive (loss) income:
Foreign currency translation adjustment	(664		)	139		1,176		(1,538		)
Cumulative effect of accounting change	—			—		—		(350		)
Minimum pension and post retirement benefit plan adjustments	12			27		36		80
Other comprehensive (loss) income	(652		)	166		1,212		(1,808		)
Total comprehensive income	$	23,824		$	19,669	$	51,946	$	48,884

See accompanying notes to consolidated financial statements.

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GIBRALTAR INDUSTRIES, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except per share data)



	September 30, 2019			December 31, 2018
	(unaudited)
Assets
Current assets:
Cash and cash equivalents	$	137,618		$	297,006
Accounts receivable, net	196,334			140,283
Inventories	83,048			98,913
Other current assets	17,527			8,351
Total current assets	434,527			544,553
Property, plant, and equipment, net	95,075			95,830
Operating lease assets	28,573			—
Goodwill	327,983			323,671
Acquired intangibles	96,185			96,375
Other assets	2,475			1,216
	$	984,818		$	1,061,645
Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable	$	103,630		$	79,136
Accrued expenses	97,883			87,074
Billings in excess of cost	38,672			17,857
Current maturities of long-term debt	—			208,805
Total current liabilities	240,185			392,872
Long-term debt	—			1,600
Deferred income taxes	36,672			36,530
Non-current operating lease liabilities	20,461			—
Other non-current liabilities	30,287			33,950
Shareholders’ equity:
Preferred stock, $0.01 par value; authorized 10,000 shares; none outstanding	—			—
Common stock, $0.01 par value; authorized 50,000 shares; 33,145 shares and 32,887 shares issued and outstanding in 2019 and 2018	332			329
Additional paid-in capital	293,009			282,525
Retained earnings	391,311			338,995
Accumulated other comprehensive loss	(6,022		)	(7,234		)
Cost of 888 and 796 common shares held in treasury in 2019 and 2018	(21,417		)	(17,922		)
Total shareholders’ equity	657,213			596,693
	$	984,818		$	1,061,645

See accompanying notes to consolidated financial statements.

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GIBRALTAR INDUSTRIES, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)(unaudited)



	Nine Months Ended September 30,
	2019			2018
Cash Flows from Operating Activities
Net income	$	50,734		$	50,692
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	14,923			15,449
Stock compensation expense	10,087			6,854
Exit activity costs, non-cash	479			1,088
Benefit of deferred income taxes	(429		)	—
Other, net	3,267			1,114
Changes in operating assets and liabilities, excluding the effects of acquisitions:
Accounts receivable	(56,645		)	(30,534		)
Inventories	18,617			(16,263		)
Other current assets and other assets	(6,949		)	1,052
Accounts payable	22,770			9,237
Accrued expenses and other non-current liabilities	15,640			(479		)
Net cash provided by operating activities	72,494			38,210
Cash Flows from Investing Activities
Acquisitions, net of cash acquired	(8,665		)	(5,241		)
Net proceeds from sale of property and equipment	87			3,147
Purchases of property, plant, and equipment	(7,703		)	(6,767		)
Net cash used in investing activities	(16,281		)	(8,861		)
Cash Flows from Financing Activities
Long-term debt payments	(212,000		)	(400		)
Payment of debt issuance costs	(1,235		)	—
Purchase of treasury stock at market prices	(3,495		)	(6,549		)
Net proceeds from issuance of common stock	400			1,343
Net cash used in financing activities	(216,330		)	(5,606		)
Effect of exchange rate changes on cash	729			(610		)
Net (decrease) increase in cash and cash equivalents	(159,388		)	23,133
Cash and cash equivalents at beginning of year	297,006			222,280
Cash and cash equivalents at end of period	$	137,618		$	245,413

See accompanying notes to consolidated financial statements.

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GIBRALTAR INDUSTRIES, INC.

CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY

(in thousands)

(unaudited)



	Common Stock			Additional Paid-In Capital			Retained Earnings		Accumulated Other Comprehensive Loss			Treasury Stock				Total Shareholders’ Equity
	Shares	Amount		Additional Paid-In Capital			Retained Earnings		Accumulated Other Comprehensive Loss			Shares	Amount			Total Shareholders’ Equity
Balance at December 31, 2018	32,887	$	329	$	282,525		$	338,995	$	(7,234	)	796	$	(17,922	)	$	596,693
Net income	—	—		—			6,345		—			—	—			6,345
Foreign currency translation adjustment	—	—		—			—		842			—	—			842
Minimum pension and post retirement benefit plan adjustments, net of taxes of $4	—	—		—			—		12			—	—			12
Stock compensation expense	—	—		2,371			—		—			—	—			2,371
Cumulative effect of accounting change (see Note 2)	—	—		—			1,582		—			—	—			1,582
Stock options exercised	12	—		139			—		—			—	—			139
Net settlement of restricted stock units	127	1		(1		)	—		—			59	(2,151		)	(2,151		)
Balance at March 31, 2019	33,026	$	330	$	285,034		$	346,922	$	(6,380	)	855	$	(20,073	)	$	605,833
Net income	—	—		—			19,913		—			—	—			19,913
Foreign currency translation adjustment	—	—		—			—		998			—	—			998
Minimum pension and post retirement benefit plan adjustments, net of taxes of $5	—	—		—			—		12			—	—			12
Stock compensation expense	—	—		3,720			—		—			—	—			3,720
Stock options exercised	5	—		69			—		—			—	—			69
Awards of common shares	8	—		—			—		—			—	—			—
Net settlement of restricted stock units	62	1		(1		)	—		—			25	(998		)	(998		)
Balance at June 30, 2019	33,101	$	331	$	288,822		$	366,835	$	(5,370	)	880	$	(21,071	)	$	629,547
Net income							24,476									24,476
Foreign currency translation adjustment									(664		)					(664		)
Minimum pension and post retirement benefit plan adjustments, net of taxes of $4									12							12
Stock compensation expense	—	—		3,996			—		—			—	—			3,996
Stock options exercised	16	—		192			—		—			—	—			192
Net settlement of restricted stock units	28	1		(1		)	—		—			8	(346		)	(346		)
Balance at September 30, 2019	33,145	$	332	$	293,009		$	391,311	$	(6,022	)	888	$	(21,417	)	$	657,213

See accompanying notes to consolidated financial statements.

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GIBRALTAR INDUSTRIES, INC.

CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY

(in thousands)

(unaudited)



	Common Stock			Additional Paid-In Capital			Retained Earnings		Accumulated Other Comprehensive Loss			Treasury Stock				Total Shareholders’ Equity
	Shares	Amount		Additional Paid-In Capital			Retained Earnings		Accumulated Other Comprehensive Loss			Shares	Amount			Total Shareholders’ Equity
Balance at December 31, 2017	32,332	$	323	$	271,957		$	274,562	$	(4,366	)	615	$	(10,757	)	$	531,719
Net income	—	—		—			8,352		—			—	—			8,352
Foreign currency translation adjustment	—	—		—			—		110			—	—			110
Minimum pension and post retirement benefit plan adjustments, net of taxes of $10	—	—		—			—		27			—	—			27
Stock compensation expense	—	—		2,097			—		—			—	—			2,097
Cumulative effect of accounting change	—	—		—			624		(350		)	—	—			274
Stock options exercised	13	—		226			—		—			—	—			226
Net settlement of restricted stock units	53	1		(1		)	—		—			24	(850		)	(850		)
Balance at March 31, 2018	32,398	$	324	$	274,279		$	283,538	$	(4,579	)	639	$	(11,607	)	$	541,955
Net income	—	—		—			22,837		—			—	—			22,837
Foreign currency translation adjustment	—	—		—			—		(1,787		)	—	—			(1,787		)
Minimum pension and post retirement benefit plan adjustments, net of taxes of $11	—	—		—			—		26			—	—			26
Stock compensation expense	—	—		2,731			—		—			—	—			2,731
Stock options exercised	21	—		300			—		—			—	—			300
Awards of common shares	2	—		—			—		—			—	—			—
Net settlement of restricted stock units	334	3		(3		)	—		—			128	(5,166		)	(5,166		)
Balance at June 30, 2018	32,755	$	327	$	277,307		$	306,375	$	(6,340	)	767	$	(16,773	)	$	560,896
Net income	—	—		—			19,503		—			—	—			19,503
Foreign currency translation adjustment	—	—		—			—		139			—	—			139
Minimum pension and post retirement benefit plan adjustments, net of taxes of $10	—	—		—			—		27			—	—			27
Stock compensation expense	—	—		2,026			—		—			—	—			2,026
Stock options exercised	50	1		816			—		—			—	—			817
Net settlement of restricted stock units	37	—		—			—		—			11	(533		)	(533		)
Balance at September 30, 2018	32,842	$	328	$	280,149		$	325,878	$	(6,174	)	778	$	(17,306	)	$	582,875

See accompanying notes to consolidated financial statements.

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GIBRALTAR INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)


(1)	CONSOLIDATED FINANCIAL STATEMENTS

The accompanying unaudited consolidated financial statements have been prepared by management in accordance with U.S. generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, all adjustments consisting of normal recurring adjustments considered necessary for the fair presentation of results for the interim period have been included. The Company's operations are seasonal; for this and other reasons, financial results for any interim period are not necessarily indicative of the results expected for the full year. The accompanying unaudited consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in our annual Form 10-K for the year ended December 31, 2018.

The balance sheet at December 31, 2018 has been derived from the audited financial statements at that date, but does not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements.

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(2)	RECENT ACCOUNTING PRONOUNCEMENTS

Recent Accounting Pronouncements Adopted



Standard	Description	Financial Statement Effect or Other Significant Matters
ASU No. 2016-02 Leases (Topic 842)	The standard requires lessees to recognize most leases as assets and liabilities on the balance sheet, but record expenses on the statement of operations in a manner similar to current accounting. For lessors, the guidance modifies the classification criteria and accounting for sales-type and direct financing leases. The standard also requires additional disclosures about leasing arrangements and requires a modified retrospective transition approach for existing leases, whereby the standard will be applied to the earliest year presented. The provisions of the standard are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted.	The Company has adopted this standard using the modified retrospective approach and elected the transition method to initially apply the new leases standard to all leases that exist at January 1, 2019. Under this transition method, the Company initially applied Topic 842 as of January 1, 2019, and recognized a cumulative-effect adjustment which increased the Company's beginning retained earnings as of January 1, 2019 by approximately $1.6 million. In addition, the Company elected the package of practical expedients permitted under the transition guidance within the new leases standard, which among other things, permitted the Company to carry forward its historical lease classification for leases in place prior to January 1, 2019. The comparative period information has not been restated and continues to be reported and presented under the accounting standards in effect for that period. The standard did not materially impact the Company's consolidated net earnings and had no impact on cash flows. Date of adoption: Q1 2019

Recent Accounting Pronouncements Not Yet Adopted



Standard	Description	Financial Statement Effect or Other Significant Matters
ASU No. 2016-13 Financial Instruments - Credit Losses (Topic 326)	The objective of this standard is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit, including trade receivables, held by an entity at each reporting date. The amendments in this update replace the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The provisions of this standard are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted. An entity will apply the amendments in this update through a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective, that is, a modified-retrospective approach.	The Company is currently evaluating the requirements of this standard. The standard is not expected to have a material impact on the Company's financial statements. Date of adoption: Q1 2020

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(3)	ACCOUNTS RECEIVABLE, NET

Accounts receivable consists of the following (in thousands):



	September 30, 2019			December 31, 2018
Trade accounts receivable	$	178,457		$	124,609
Costs in excess of billings	24,951			22,634
Total accounts receivables	203,408			147,243
Less allowance for doubtful accounts	(7,074		)	(6,960		)
Accounts receivable	$	196,334		$	140,283

Refer to Note 4 of the Company's consolidated financial statements included in this quarterly report on Form 10-Q for additional information concerning the Company's costs in excess of billings.


(4)	REVENUE

Sales includes revenue from contracts with customers for designing, engineering, manufacturing and installation of solar racking systems and greenhouse structures; extraction systems; roof and foundation ventilation products; centralized mail systems and electronic package solutions; rain dispersion products and roofing accessories; expanded and perforated metal; perimeter security solutions; expansion joints and structural bearings.

Revenue recognition

Revenue is recognized when, or as, the Company transfers control of promised products or services to a customer in an amount that reflects the consideration the Company expects to be entitled in exchange for transferring those products or services. Refer to Note 16 of this quarterly report on Form 10-Q for additional information related to revenue recognized by timing of transfer of control by reportable segment.

As of September 30, 2019, the Company's remaining performance obligations are part of contracts that have an original expected duration of one year or less.

Contract assets and contract liabilities

Contract assets consist of costs in excess of billings. Contract liabilities consist of billings in excess of cost and unearned revenue. Unearned revenue relates to payments received in advance of performance under the contract and is recognized when the Company performs under the contract. Unearned revenue is presented within accrued expenses in the Company's consolidated balance sheet.

The following table presents the beginning and ending balances of costs in excess of billings, billings in excess of cost and unearned revenue as of September 30, 2019 and December 31, 2018, respectively, and revenue recognized during the nine months ended September 30, 2019 and 2018, respectively, that was in billings in excess of cost and unearned revenue at the beginning of the period (in thousands):



	September 30, 2019			December 31, 2018
Costs in excess of billings	$	24,951		$	22,634
Billings in excess of cost	(38,672		)	(17,857		)
Unearned revenue	(21,860		)	(12,028		)

The increase in contract liabilities as of September 30, 2019 compared with December 31, 2018 was primarily driven by the seasonality in our businesses.

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	Nine Months Ended September 30, 2019		Nine Months Ended September 30, 2018
Revenue recognized in the period from:
Amounts included in billings in excess of cost at the beginning of the period	$	14,137	$	9,294
Amounts included in unearned revenue at the beginning of the period	$	11,052	$	2,977


(5)	INVENTORIES

Inventories consist of the following (in thousands):



	September 30, 2019		December 31, 2018
Raw material	$	48,158	$	57,845
Work-in-process	7,658		6,930
Finished goods	27,232		34,138
Total inventories	$	83,048	$	98,913

(6) ACQUISITIONS

On August 30, 2019, the Company acquired all of the outstanding membership interests of Apeks LLC ("Apeks"), a designer and manufacturer of botanical oil extraction systems and equipment. The results of Apeks have been included in the Company's consolidated financial results since the date of acquisition within the Company's Renewable Energy and Conservation segment. The preliminary purchase consideration for the acquisition of Apeks was $12.6 million, which includes a working capital adjustment and certain other adjustments provided for in the stock purchase agreement expected to be remitted in the next three to six months, at which time a final purchase price will be determined. The acquisition was financed through cash on hand.

The preliminary purchase price for the acquisition was allocated to the assets acquired and liabilities assumed based upon their respective fair values. The excess consideration was recorded as goodwill and approximated $4.2 million, all of which is deductible for tax purposes. Goodwill represents future economic benefits arising from other assets acquired that could not be individually identified including workforce additions, growth opportunities, and increased presence in the conservation markets.

The allocation of the preliminary purchase consideration to the fair value of the assets acquired and liabilities assumed is as follows as of the date of the acquisition (in thousands):



Cash	$	4,149
Working capital	(1,230		)
Property, plant and equipment	859
Acquired intangible assets	5,061
Other assets	508
Other liabilities	(982		)
Goodwill	4,185
Fair value of purchase consideration	$	12,550

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The intangible assets acquired in this acquisition consisted of the following (in thousands):



	Fair Value		Weighted-Average Amortization Period
Trademarks	$	900	Indefinite
Technology	793		9 years
Customer relationships	3,368		9 years
Total	$	5,061

On August 21, 2018, the Company acquired all of the outstanding stock of SolarBOS. SolarBOS is a provider of electrical balance of systems products, which consists of electrical components such as wiring, switches, and combiner boxes that support photovoltaic systems, for the U.S. solar renewable energy market. The Company expects the acquisition of SolarBOS to enable the Company to provide complementary product offerings to its existing customers and strengthen its position in the solar renewable energy market. The results of SolarBOS have been included in the Company's consolidated financial results since the date of acquisition (within the Company's Renewable Energy and Conservation segment). The aggregate purchase consideration for the acquisition of SolarBOS was $6.4 million, which includes a working capital adjustment and certain other adjustments provided for in the stock purchase agreement. The acquisition was financed through cash on hand.

The purchase price for the acquisition was allocated to the assets acquired and liabilities assumed based upon their respective fair values. The excess consideration was recorded as goodwill and approximated $2.9 million, all of which is deductible for tax purposes. Goodwill represents future economic benefits arising from other assets acquired that could not be individually identified including workforce additions, growth opportunities, and increased presence in the solar renewable energy markets.

The allocation of the purchase consideration to the fair value of the assets acquired and liabilities assumed is as follows as of the date of the acquisition (in thousands):



Cash	$	915
Working capital	680
Property, plant and equipment	483
Acquired intangible assets	1,450
Other assets	13
Other liabilities	(51		)
Goodwill	2,879
Fair value of purchase consideration	$	6,369

The intangible assets acquired in this acquisition consisted of the following (in thousands):



	Fair Value		Weighted-Average Amortization Period
Trademarks	$	300	3 years
Technology	450		9 years
Customer relationships	700		9 years
Total	$	1,450

The Company incurred certain acquisition-related costs composed of legal and consulting fees. These costs were recognized as a component of selling, general, and administrative expenses in the consolidated statement of operations. The Company also recognized costs as a component of cost of sales related to the sale of inventory at fair value as a result of allocating the purchase price of recent acquisitions.

Table of Contents

The acquisition-related costs consisted of the following for the three and nine months ended September 30 (in thousands):



	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Selling, general and administrative costs	$	470	$	471	$	474	$	471
Cost of sales	134		—		134		—
Total acquisition-related costs	$	604	$	471	$	608	$	471


(7)	GOODWILL AND RELATED INTANGIBLE ASSETS

Goodwill

The changes in the carrying amount of goodwill for the nine months ended September 30, 2019 are as follows (in thousands):



	Renewable Energy & Conservation			Residential Products		Industrial and Infrastructure Products		Total
Balance at December 31, 2018	$	71,827		$	198,075	$	53,769	$	323,671
Acquired goodwill	4,185			—				4,185
Adjustments to prior year acquisitions	(172		)			—		(172		)
Foreign currency translation	137			—		162		299
Balance at September 30, 2019	$	75,977		$	198,075	$	53,931	$	327,983

Acquired Intangible Assets

Acquired intangible assets consist of the following (in thousands):

September 30, 2019

December 31, 2018

Gross

Carrying

Amount

Accumulated

Amortization

Gross

Carrying

Amount

Accumulated

Amortization

Weighted-Average Amortization Period

Indefinite-lived intangible assets:

Trademarks

44,770

—

Closing Price ($)	Shares Out (MM)	Market Cap ($MM)
$0.00	33	$1,272

10-Q	2019-10-25	Quarter: 2019-09-30
10-Q	2019-07-26	Quarter: 2019-06-30
10-Q	2019-05-03	Quarter: 2019-03-31
10-K	2019-02-27	Annual: 2018-12-31
10-Q	2018-11-01	Quarter: 2018-09-30
10-Q	2018-07-26	Quarter: 2018-06-30
10-Q	2018-05-04	Quarter: 2018-03-31
10-K	2018-02-27	Annual: 2017-12-31
10-Q	2017-11-03	Quarter: 2017-09-30
10-Q	2017-07-27	Quarter: 2017-06-30
10-Q	2017-05-05	Quarter: 2017-03-31
10-K	2017-02-21	Annual: 2016-12-31
10-Q	2016-11-04	Quarter: 2016-09-30
10-Q	2016-07-28	Quarter: 2016-06-30
10-Q	2016-05-06	Quarter: 2016-03-31
10-K	2016-02-18	Annual: 2015-12-31
10-Q	2015-10-28	Quarter: 2015-09-30
10-Q	2015-08-07	Quarter: 2015-06-30
10-Q	2015-05-07	Quarter: 2015-03-31
10-K	2015-02-24	Annual: 2014-12-31
10-Q	2014-10-28	Quarter: 2014-09-30
10-Q	2014-08-05	Quarter: 2014-06-30
10-Q	2014-05-02	Quarter: 2014-03-31
10-K	2014-02-20	Annual: 2013-12-31
10-Q	2013-10-31	Quarter: 2013-09-30
10-Q	2013-08-01	Quarter: 2013-06-30
10-Q	2013-05-02	Quarter: 2013-03-31
10-Q	2012-11-01	Quarter: 2012-09-30
10-Q	2012-08-02	Quarter: 2012-06-30
10-Q	2012-05-03	Quarter: 2012-03-31
10-Q	2011-11-04	Quarter: 2011-09-30
10-Q	2011-08-05	Quarter: 2011-06-30
10-Q	2011-05-05	Quarter: 2011-03-31
10-K	2011-02-25	Annual: 2010-12-31
10-Q	2010-11-04	Quarter: 2010-09-30
10-Q	2010-08-09	Quarter: 2010-06-30
10-Q	2010-05-06	Quarter: 2010-03-31
10-K	2010-02-25	Annual: 2009-12-31

8-K	2020-01-17	Other Events, Other Events, Exhibits
8-K	2019-10-25	Earnings, Regulation FD, Exhibits
8-K	2019-07-26	Earnings, Regulation FD, Exhibits
8-K	2019-05-06	Earnings, Regulation FD, Shareholder Vote, Exhibits
8-K	2019-03-19	Officers, Exhibits
8-K	2019-02-21	Earnings, Regulation FD, Exhibits
8-K	2019-01-25	Enter Agreement, Enter Agreement, Other Events, Exhibits
8-K	2019-01-07	Officers, Exhibits
8-K	2018-12-20	Other Events, Other Events, Exhibits
8-K	2018-11-01	Earnings, Regulation FD, Officers, Exhibits
8-K	2018-08-23	Other Events, Other Events, Exhibits
8-K	2018-07-26	Earnings, Regulation FD, Exhibits
8-K	2018-06-06	Officers, Other Events, Exhibits
8-K	2018-05-07	Earnings, Regulation FD, Officers, Shareholder Vote, Other Events, Exhibits
8-K	2018-02-23	Earnings, Regulation FD, Exhibits

EX-31.1	q32019exhibit311.htm
EX-31.2	q32019exhibit312.htm
EX-32.1	q32019exhibit321.htm
EX-32.2	q32019exhibit322.htm