Company Quick10K Filing
Quick10K
Gibraltar Industries
Closing Price ($) Shares Out (MM) Market Cap ($MM)
$39.14 32 $1,260
10-Q 2018-09-30 Quarter: 2018-09-30
10-Q 2018-06-30 Quarter: 2018-06-30
10-Q 2018-03-31 Quarter: 2018-03-31
10-K 2017-12-31 Annual: 2017-12-31
10-Q 2017-09-30 Quarter: 2017-09-30
10-Q 2017-06-30 Quarter: 2017-06-30
10-Q 2017-03-31 Quarter: 2017-03-31
10-K 2016-12-31 Annual: 2016-12-31
10-Q 2016-09-30 Quarter: 2016-09-30
10-Q 2016-06-30 Quarter: 2016-06-30
10-Q 2016-03-31 Quarter: 2016-03-31
10-K 2015-12-31 Annual: 2015-12-31
8-K 2019-02-21 Earnings, Regulation FD, Exhibits
8-K 2019-01-25 Enter Agreement, Enter Agreement, Other Events, Exhibits
8-K 2019-01-25 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 2018-08-23 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
MT Arcelormittal
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STLD Steel Dynamics
CRS Carpenter Technology
AKS AK Steel Holding
IIIN Insteel Industries
TWI Titan International
USAP Universal Stainless & Alloy Products
SYNL Synalloy
FRD Friedman Industries
ROCK 2018-09-30
Part I. Financial Information
Item 1. Financial Statements
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Qualitative and Quantitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II. Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Mine Safety Disclosures
Item 5. Other Information
Item 6. Exhibits
EX-31.1 q32018exhibit311.htm
EX-31.2 q32018exhibit312.htm
EX-32.1 q32018exhibit321.htm
EX-32.2 q32018exhibit322.htm

Gibraltar Industries Earnings 2018-09-30

ROCK 10Q Quarterly Report

Balance SheetIncome StatementCash Flow

10-Q 1 rock-20180930x10q.htm 10-Q Document

 
 
 
 
 
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

 gibindcolorlogonotaga03.gif
 
FORM 10-Q
 
 
 
x
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2018
OR
¨
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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
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  x    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  x    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 definition 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
x
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  x

As of October 31, 2018, the number of common shares outstanding was: 32,064,809.



GIBRALTAR INDUSTRIES, INC.
INDEX
 
 
PAGE 
NUMBER
PART I.
 
 
Item 1.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Item 2.
 
Item 3.
 
Item 4.
 
PART II.
 
 
Item 1.
 
Item 1A.
 
Item 2.
 
Item 3.
 
Item 4.
 
Item 5.
 
Item 6.
 
 
 


2


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,
 
2018
 
2017
 
2018
 
2017
Net Sales
$
280,086

 
$
274,574

 
$
761,459

 
$
728,806

Cost of sales
209,807

 
205,839

 
572,359

 
548,991

Gross profit
70,279

 
68,735

 
189,100

 
179,815

Selling, general, and administrative expense
40,875

 
33,042

 
113,579

 
109,513

Income from operations
29,404

 
35,693

 
75,521

 
70,302

Interest expense
2,906

 
3,486

 
9,305

 
10,612

Other expense (income)
522

 
404

 
(50
)
 
811

Income before taxes
25,976

 
31,803

 
66,266

 
58,879

Provision for income taxes
6,473

 
11,184

 
15,574

 
21,090

Income from continuing operations
19,503

 
20,619

 
50,692

 
37,789

Discontinued operations:
 
 
 
 
 
 
 
Loss before taxes

 

 

 
(644
)
Benefit of income taxes

 

 

 
(239
)
Loss from discontinued operations

 

 

 
(405
)
Net income
$
19,503

 
$
20,619

 
$
50,692

 
$
37,384

Net earnings per share – Basic:
 
 
 
 
 
 
 
Income from continuing operations
$
0.61

 
$
0.65

 
$
1.59

 
$
1.19

Loss from discontinued operations

 

 

 
(0.01
)
Net income
$
0.61

 
$
0.65

 
$
1.59

 
$
1.18

Weighted average shares outstanding -- Basic
32,115

 
31,703

 
31,922

 
31,700

Net earnings per share – Diluted:
 
 
 
 
 
 
 
Income from continuing operations
$
0.60

 
$
0.64

 
$
1.56

 
$
1.17

Loss from discontinued operations

 

 

 
(0.01
)
Net income
$
0.60

 
$
0.64

 
$
1.56

 
$
1.16

Weighted average shares outstanding -- Diluted
32,571

 
32,210

 
32,524

 
32,216

See accompanying notes to consolidated financial statements.

3


GIBRALTAR INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in thousands)
(unaudited)
 
 
Three Months Ended 
 September 30,
 
Nine Months Ended 
 September 30,
 
2018
 
2017
 
2018
 
2017
Net income
$
19,503

 
$
20,619

 
$
50,692

 
$
37,384

Other comprehensive income (loss):
 
 
 
 
 
 
 
Foreign currency translation adjustment
139

 
1,581

 
(1,538
)
 
3,351

Cumulative effect of accounting change (see Note 2)

 

 
(350
)
 

Adjustment to retirement benefit liability, net of tax
(5
)
 
(2
)
 
(15
)
 
(8
)
Adjustment to post employment health care benefit liability, net of tax
32

 
29

 
95

 
88

Other comprehensive income (loss)
166

 
1,608

 
(1,808
)
 
3,431

Total comprehensive income
$
19,669

 
$
22,227

 
$
48,884

 
$
40,815

See accompanying notes to consolidated financial statements.

4


GIBRALTAR INDUSTRIES, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)

 
September 30,
2018
 
December 31,
2017
 
(unaudited)
 
 
Assets
 
 
 
Current assets:
 
 
 
Cash and cash equivalents
$
245,413

 
$
222,280

Accounts receivable, net
180,875

 
145,385

Inventories
97,486

 
86,372

Other current assets
8,949

 
8,727

Total current assets
532,723

 
462,764

Property, plant, and equipment, net
93,718

 
97,098

Goodwill
323,321

 
321,074

Acquired intangibles
99,545

 
105,768

Other assets
4,480

 
4,681

 
$
1,053,787

 
$
991,385

Liabilities and Shareholders’ Equity
 
 
 
Current liabilities:
 
 
 
Accounts payable
$
92,997

 
$
82,387

Accrued expenses
76,268

 
75,467

Billings in excess of cost
21,900

 
12,779

Current maturities of long-term debt
400

 
400

Total current liabilities
191,565

 
171,033

Long-term debt
209,809

 
209,621

Deferred income taxes
32,110

 
31,237

Other non-current liabilities
37,428

 
47,775

Shareholders’ equity:
 
 
 
Preferred stock, $0.01 par value; authorized 10,000 shares; none outstanding

 

Common stock, $0.01 par value; authorized 50,000 shares; 32,842 shares and 32,332 shares issued and outstanding in 2018 and 2017
328

 
323

Additional paid-in capital
280,149

 
271,957

Retained earnings
325,878

 
274,562

Accumulated other comprehensive loss
(6,174
)
 
(4,366
)
Cost of 778 and 615 common shares held in treasury in 2018 and 2017
(17,306
)
 
(10,757
)
Total shareholders’ equity
582,875

 
531,719

 
$
1,053,787

 
$
991,385

See accompanying notes to consolidated financial statements.

5


GIBRALTAR INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)(unaudited) 
 
Nine Months Ended 
 September 30,
 
2018
 
2017
Cash Flows from Operating Activities
 
 
 
Net income
$
50,692

 
$
37,384

Loss from discontinued operations

 
(405
)
Income from continuing operations
50,692

 
37,789

Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
Depreciation and amortization
15,449

 
16,427

Stock compensation expense
6,854

 
5,069

Net gain on sale of assets
(203
)
 
(139
)
Exit activity costs (recoveries), non-cash
1,088

 
(1,931
)
Benefit of deferred income taxes

 
(136
)
Other, net
1,317

 
1,411

Changes in operating assets and liabilities, excluding the effects of acquisitions:
 
 
 
Accounts receivable
(30,534
)
 
(42,310
)
Inventories
(16,263
)
 
2,016

Other current assets and other assets
1,052

 
(2,002
)
Accounts payable
9,237

 
25,134

Accrued expenses and other non-current liabilities
(479
)
 
7,503

Net cash provided by operating activities
38,210

 
48,831

Cash Flows from Investing Activities
 
 
 
Cash paid for acquisitions, net of cash acquired
(5,241
)
 
(18,494
)
Net proceeds from sale of property and equipment
3,147

 
12,935

Purchases of property, plant, and equipment
(6,767
)
 
(5,152
)
Net cash used in investing activities
(8,861
)
 
(10,711
)
Cash Flows from Financing Activities
 
 
 
Long-term debt payments
(400
)
 
(400
)
Purchase of treasury stock at market prices
(6,549
)
 
(1,982
)
Net proceeds from issuance of common stock
1,343

 
649

Net cash used in financing activities
(5,606
)
 
(1,733
)
Effect of exchange rate changes on cash
(610
)
 
1,468

Net increase in cash and cash equivalents
23,133

 
37,855

Cash and cash equivalents at beginning of year
222,280

 
170,177

Cash and cash equivalents at end of period
$
245,413

 
$
208,032

See accompanying notes to consolidated financial statements.

6


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
 
 
 
 
Shares
 
Amount
 
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

Adjustment to retirement benefit liability, net of taxes of $(2)

 

 

 

 
(5
)
 

 

 
(5
)
Adjustment to post employment health care benefit liability, net of taxes of $12

 

 

 

 
32

 

 

 
32

Stock compensation expense

 

 
2,097

 

 

 

 

 
2,097

Cumulative effect of accounting change (see Note 2)

 

 

 
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
)
Adjustment to retirement benefit liability, net of taxes of $(2)

 

 

 

 
(5
)
 

 

 
(5
)
Adjustment to post employment health care benefit liability, net of taxes of $13

 

 

 

 
31

 

 

 
31

Stock compensation expense

 

 
2,731

 

 

 

 

 
2,731

Stock options exercised
21

 

 
300

 

 

 

 

 
300

Issuance of restricted stock
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

Adjustment to retirement benefit liability, net of taxes of $(2)

 

 

 

 
(5
)
 

 

 
(5
)
Adjustment to post employment health care benefit liability, net of taxes of $12

 

 

 

 
32

 

 

 
32

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.

7


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
 
 
 
 
Shares
 
Amount
 
Balance at December 31, 2016
32,085

 
$
320

 
$
264,418

 
$
211,748

 
$
(7,721
)
 
530

 
$
(7,885
)
 
$
460,880

Net income

 

 

 
3,996

 

 

 

 
3,996

Foreign currency translation adjustment

 

 

 

 
679

 

 

 
679

Adjustment to retirement benefit liability, net of taxes of $(2)

 

 

 

 
(3
)
 

 

 
(3
)
Adjustment to post employment health care benefit liability, net of taxes of $19

 

 

 

 
29

 

 

 
29

Stock compensation expense

 

 
1,635

 

 

 

 

 
1,635

Cumulative effect of accounting change (see Note1)

 

 
(254
)
 
254

 

 

 

 

Stock options exercised
1

 

 
11

 

 

 

 

 
11

Issuance of restricted stock

 

 

 

 

 

 

 

Net settlement of restricted stock units
47

 
1

 
(1
)
 

 

 
22

 
(922
)
 
(922
)
Balance at March 31, 2017
32,133

 
$
321

 
$
265,809

 
$
215,998

 
$
(7,016
)
 
552

 
$
(8,807
)
 
$
466,305

Net income

 

 

 
12,769

 

 

 

 
12,769

Foreign currency translation adjustment

 

 

 

 
1,091

 

 

 
1,091

Adjustment to retirement benefit liability, net of taxes of $(1)

 

 

 

 
(3
)
 

 

 
(3
)
Adjustment to post employment health care benefit liability, net of taxes of $17

 

 

 

 
30

 

 

 
30

Stock compensation expense

 

 
1,556

 

 

 

 

 
1,556

Stock options exercised
15

 

 
236

 

 

 

 

 
236

Issuance of restricted stock
2

 

 

 

 

 

 

 

Net settlement of restricted stock units
5

 

 

 

 

 
2

 
(81
)
 
(81
)
Balance at June 30, 2017
32,155

 
$
321

 
$
267,601

 
$
228,767

 
$
(5,898
)
 
554

 
$
(8,888
)
 
$
481,903

Net income

 

 

 
20,619

 

 

 

 
20,619

Foreign currency translation adjustment

 

 

 

 
1,581

 

 

 
1,581

Adjustment to retirement benefit liability, net of taxes of $(2)

 

 

 

 
(2
)
 

 

 
(2
)
Adjustment to post employment health care benefit liability, net of taxes of $18

 

 

 

 
29

 

 

 
29

Stock compensation expense

 

 
1,878

 

 

 

 

 
1,878

Stock options exercised
24

 

 
402

 

 

 

 

 
402

Issuance of restricted stock

 

 

 

 

 

 

 

Net settlement of restricted stock units
96

 
1

 
(1
)
 

 

 
34

 
(979
)
 
(979
)
Balance at September 30, 2017
32,275

 
$
322

 
$
269,880

 
$
249,386

 
$
(4,290
)
 
588

 
$
(9,867
)
 
$
505,431

See accompanying notes to consolidated financial statements.

8


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, 2017.

The balance sheet at December 31, 2017 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.

Refer to Note 1 of the Company's annual report on Form 10-K for the year ended December 31, 2017 for the cumulative effect of an accounting change adjustment recognized during the quarter ended March 31, 2017 and presented in the Company's Consolidated Statement of Shareholders' Equity for the nine months ended September 30, 2017 in this Form 10-Q.


9




(2)
RECENT ACCOUNTING PRONOUNCEMENTS

Recent Accounting Pronouncements Adopted
Standard
 
Description
 
Financial Statement Effect or Other Significant Matters
ASU No. 2014-09
Revenue from Contracts with Customers (Topic 606) And All Related ASUs
 
The standard requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard also requires additional disclosures about the nature, amount, timing, and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and assets recognized from costs incurred to obtain or fulfill a contract. The provisions of the standard, as well as all subsequently issued clarifications to the standard, are effective for fiscal years beginning after December 15, 2017 and interim periods within those fiscal years. The standard can be adopted using either a full retrospective or modified retrospective approach.
 
The Company has adopted this standard using the modified retrospective method. The Company recognized the cumulative- effect adjustment of initially applying this standard of $274,000 to the opening balance of retained earnings. The comparative information has not been restated and continues to be reported under the accounting standard in effect for that period. Refer to Note 4 for further disclosure of the financial statement effect and other significant matters as a result of the adoption of this standard.




Date of adoption: Q1 2018
ASU No. 2016-15
Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments
 
The standard provides guidance on eight specific cash flow issues to reduce diversity in reporting. The provisions of this standard are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Early adoption is permitted.
 
The Company has adopted this standard and it did not have any impact on the Company's consolidated financial statements.


Date of adoption: Q1 2018
ASU No. 2016-16
Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory
 
The standard allows an entity to recognize income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. The provisions of this standard are effective for annual reporting periods beginning after December 15, 2017, including interim reporting periods within those annual reporting periods. Early adoption is permitted as of the beginning of an annual reporting period for which financial statements (interim or annual) have not been issued or made available for issuance.
 
The Company has adopted this standard and it did not have any impact on the Company's consolidated financial statements.





Date of adoption: Q1 2018
ASU No. 2018-02 Income Statement-Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income
 
The standard allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act. The provisions of this standard are effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption of the standard is permitted, including adoption in any interim period.
 
The Company has early adopted this standard. As a result of adopting this standard, the Company recorded an adjustment of $350,000 from accumulated other comprehensive income to retained earnings in the consolidated statement of shareholders' equity as of the beginning of the January 1, 2018, and will record any subsequent period adjustments, if changes to provisional amounts result in additional amounts stranded in accumulated other comprehensive income.

Date of adoption: Q1 2018

10


Recent Accounting Pronouncements Not Yet 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 continues to evaluate the impact of the standard on the Company’s consolidated financial statements and related disclosures.  The new standard requires lessees to recognize a lease liability and right of use asset on the balance sheet.  While the adoption will result in an increase to assets and liabilities on the Company’s balance sheet, we do not expect that the impact will be material.  In addition, the Company does not expect that the adoption will result in a  material impact to our consolidated statement of operations. The Company intends to adopt this guidance by applying the transition provisions on a modified retrospective basis as of the effective date January 1, 2019.
 
Planned date of adoption: Q1 2019

(3)
ACCOUNTS RECEIVABLE, NET

Accounts receivable consists of the following (in thousands):
 
September 30, 2018
 
December 31, 2017
Trade accounts receivable
$
166,208

 
$
140,209

Costs in excess of billings
21,522

 
11,610

Total accounts receivables
187,730

 
151,819

Less allowance for doubtful accounts
(6,855
)
 
(6,434
)
Accounts receivable
$
180,875

 
$
145,385


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 from 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; designing, engineering, manufacturing and installation of solar racking systems and greenhouse structures.

Revenue recognition

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

Payment terms and conditions vary by contract, although terms generally include a requirement of payment within a range from 30 to 60 days, or in certain cases, up front deposits. In circumstances where the timing of revenue recognition differs from the timing of invoicing, the Company has determined that the Company's contracts generally

11


do not include a significant financing component. Taxes collected from customers, which are subsequently remitted to governmental authorities, are excluded from sales.

Performance obligations satisfied at a point in time and significant judgments

The majority of the Company's revenue from contracts with customers is recognized when the Company transfers control of the promised product at a point in time, which is determined when the customer has legal title and the significant risks and rewards of ownership of the asset, and the Company has a present right to payment for the product. These contracts with customers include promised products, which are generally capable of being distinct and accounted for as separate performance obligations. Accordingly, the Company allocates the transaction price, which is generally the quoted price per terms of the contract and the consideration the Company expects to receive, to each performance obligation in an amount based on an observable price of the products as the Company frequently sells these products separately in similar circumstances and to similar customers. These products are generally sold with rights of return and these contracts may provide other credits or incentives, which are accounted for as variable consideration. Variable consideration is estimated at the most likely amount to predict the consideration to which the Company will be entitled, and only to the extent it is probable that a subsequent change in estimate will not result in a significant revenue reversal when estimating the amount of revenue to recognize. Sales returns, allowances, and customer incentives, including rebates, are treated as reductions to the sales transaction price and based largely on an assessment of all information (i.e., historical, current and forecasted) that is reasonably available to the Company, and estimated at contract inception and updated at the end of each reporting period as additional information becomes available.

Performance obligations satisfied over time and significant judgments

For contracts with customers which the Company satisfies a promise to the customer to construct a certain asset that the customer controls as it is being created or enhanced, or a promise to provide a product that has no alternative use to the Company and the Company has enforceable rights to payment, the Company satisfies the performance obligation and recognizes revenue over time. For the contracts to construct a certain asset, the Company determines that the customer controls the asset while it is being constructed. For the contracts for products that have no alternative use and for which the Company has an enforceable right to payment, the Company identifies these products as products that are not a standard inventory item or the Company cannot readily direct the product to another customer or use without incurring a significant economic loss, or significant costs to rework the product.

When the promised products and services are to construct a certain asset that the customer controls, the entire contract is accounted for as one performance obligation. The Company determines the transaction price for each contract based on the consideration the Company expects to receive for the promised products and services under the entire contract, which is generally the stated contract price based on an expected cost plus a margin approach.

When the promised products do not have an alternative use to the Company, and the Company has enforceable rights to payment, the transaction price is determined for each contract based on the consideration the Company expects to receive for the promised products under the contract and is generally the stated contract price based on an expected cost plus a margin approach for each performance obligation. These promised products are generally capable of being distinct and accounted for as separate performance obligations.

For the above contracts with customers with respect to which the Company satisfies a performance obligation over time, the Company recognizes revenue based on the extent of progress towards completion of the performance obligation. The cost-to-cost measure of progress best depicts the transfer of control to the customer which occurs as the Company incurs costs on the contract as the incurred costs are proportionate to the Company's progress in satisfying the performance obligation. Under the cost-to-cost measure of progress, the extent of progress toward completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation. Revenues are recognized proportionally as costs are incurred. Costs to fulfill a contract include all direct costs related to contract performance. Selling and administrative expenses are charged to operations as incurred. Provision for loss on an uncompleted performance obligation is recognized in the period in which such loss is determined.

The Company regularly reviews the progress and performance of the performance obligation recognized over time under the cost-to-cost method. Any adjustments to net sales, cost of sales, and the related impact to operating income are recognized as necessary in the period they become known. Changes in estimates of net sales, cost of sales, and the related impact to operating income are recognized on a cumulative catch-up basis, which recognizes in the current

12


period the cumulative effect of the changes on current or prior periods based on a performance obligation's cost-to-cost measure of progress.

The Company also recognizes revenues from services contracts over time. For these contracts, the transaction price is determined for each contract based on the consideration the Company expects to receive for the promised service under the contract, which generally is the stated contract price. In order to estimate the standalone selling price of the performance obligation, the Company evaluates the market in which the promised service is sold and estimates the price that customers in the market would be willing to pay. Further, the Company recognizes revenue over time during the term of the agreement as the customer is simultaneously receiving and consuming the benefits provided throughout the Company's performance. Therefore due to control transferring over time, the Company recognizes revenue on a straight-line basis throughout the contract period.

Remaining performance obligations

As of September 30, 2018, the Company's remaining performance obligations are part of contracts that have an original expected duration of one year or less. Therefore, any remaining performance obligations are not required to be disclosed.

Contract assets

Contract assets consist of costs in excess of billings. Costs in excess of billings includes unbilled amounts resulting from revenues under contracts with customers that are satisfied over time and when the cost-to-cost measurement method of revenue recognition is utilized and revenue recognized exceeds the amount billed to the customer, and right to payment is not just subject to the passage of time. Amounts may not exceed their net realizable value. Costs in excess of billings are classified as current assets and are reported net of contract billings on a contract-by-contract basis at the end of each reporting period.

Contract liabilities

Contract liabilities consist of billings in excess of cost. Billings in excess of cost includes billings in excess of revenue recognized and deferred revenue, which includes advanced payments, up-front payments, and progress billing payments. Billings in excess of cost are reported net of contract cost on a contract-by-contract basis at the end of each reporting period and are classified as current liabilities. To determine the revenue recognized in the period from the beginning balance of billings in excess of cost, the contract liability as of the beginning of the period is recognized as revenue on a contract by contract basis when the Company incurs costs to satisfy the performance obligation related to the individual contract. Once the beginning contract liability balance for an individual contract has been fully recognized as revenue, any additional payments received in the period are recognized as revenue once the related costs have been incurred.

Costs to obtain a contract with a customer

The Company recognizes an asset for the incremental costs of obtaining a contract with a customer if the Company expects the benefit of those costs to be longer than one year. As of September 30, 2018, the Company does not have any open contracts with an original expected duration of greater than one year, and therefore, we expense such costs as incurred. These incremental costs include, but are not limited to, sales commissions incurred to obtain a contract with a customer.


13


Contract assets and contract liabilities

The Company's contract assets and contract liabilities consist of costs in excess of billings and billings in excess of cost, respectively. The following table presents the beginning and ending balances and significant changes in the costs in excess of billings and billings in excess of cost balance during the three months ended September 30, 2018:
 
Costs in Excess of Billings
 
Billings in Excess of Cost
Beginning balance, January 1, 2018 (1)
$
16,532

 
$
(12,779
)
Reclassification of the beginning balances of:
 
 
 
Costs in excess of billings to receivables
(15,450
)
 

Billings in excess of cost to revenue

 
9,294

Costs in excess of billings recognized, net of reclassification to receivables
20,440

 

Net billings in advance and cash payments not recognized as revenue

 
(18,415
)
Ending balance, September 30, 2018
$
21,522

 
$
(21,900
)
(1) Due to the adoption of ASC 606 effective January 1, 2018, the Company recorded a transition adjustment to the opening balance of "Costs in excess of billings" at January 1, 2018. There were no transition adjustments to the opening balance of "Billings in Excess of Cost" at January 1, 2018. Refer to "Transition disclosures" below for further explanation of cumulative effect of the changes made to the Company's consolidated January 1, 2018 balance sheet for the adoption of ASC 606.

Transition disclosures

On January 1, 2018, the Company adopted the accounting standard ASC 606, Revenue from Contracts with Customers, only for contracts that were not completed at the date of initial application using the modified retrospective method. The Company recognized the cumulative effect of initially applying ASC 606 as an adjustment to the opening balance of retained earnings. The comparative period information has not been restated and continues to be reported under the accounting standards in effect for that period. The Company does not expect the adoption of this standard to have a material impact to the Company's net income on an ongoing basis.

A majority of the Company's revenues continue to be recognized when products are shipped or service is provided and the customer takes ownership and assumes the risk of loss. For certain custom fabricated products for which there is no alternative use and the Company has enforceable rights to payment for performance to date where revenue was previously recognized upon transfer of title and risk of loss, the Company now recognizes revenue as the Company satisfies its performance over time in accordance with ASC 606.


14


The cumulative effect of the changes made to the Company's consolidated January 1, 2018 balance sheet for the adoption of ASC 606 is as follows (in thousands):
 
Balance at December 31, 2017
 
Adjustments
 
Balance at January 1, 2018
Assets
 
 
 
 
 
Accounts receivable, net
$
145,385

 
$
4,922

 
$
150,307

Costs in excess of billings (1)
$
11,610

 
$
4,922

 
$
16,532

Inventories
$
86,372

 
$
(4,735
)
 
$
81,637

Total current assets
$
462,764

 
$
187

 
$
462,951

Total assets
$
991,385

 
$
187

 
$
991,572

 
 
 
 
 
 
Liabilities
 
 
 
 
 
Accrued expenses
$
75,467

 
$
(87
)
 
$
75,380

Total current liabilities
$
171,033

 
$
(87
)
 
$
170,946

 
 
 
 
 
 
Shareholders' equity
 
 
 
 
 
Retained earnings
$
274,562

 
$
274

 
$
274,836

Total shareholders' equity
$
531,719

 
$
274

 
$
531,993

Total liabilities and shareholders' equity
$
991,385

 
$
187

 
$
991,572

(1) The balance presented at December 31, 2017 for "Costs in excess of billings" represents the balance reported in Note 2 of the Company's annual report on Form 10-K for the year ended December 31, 2017. This balance was included within the total balance of "Accounts receivable, net" presented on the Company's Consolidated Balance Sheet on Form 10-K as of December 31, 2017. Due to the adoption of ASC 606 effective January 1, 2018, the Company recorded a transition adjustment to the opening balance of "Costs in excess of billings" at January 1, 2018 that is included in the "Accounts receivable, net" line item presented on the Company's Consolidated Balance Sheet and disclosed in Note 3 of this Form 10-Q for the nine months ended September 30, 2018.


15


In accordance with ASC 606, the disclosure of the impact of adoption on the Company's consolidated statement of income and balance sheet for the periods ended September 30, 2018 is as follows (in thousands):
Consolidated Statement of Income
 
Three Months Ended September 30, 2018
 
As Reported
 
Without Adoption of ASC 606
 
Effect of Change
Higher (Lower)
 
 
 
 
 
 
Net sales
$
280,086

 
$
281,156

 
$
(1,070
)
Cost of sales
209,807

 
210,878

 
(1,071
)
Gross profit
70,279

 
70,278

 
1

Provision for income taxes
6,473

 
6,473

 

Net income
$
19,503

 
$
19,502

 
$
1


Consolidated Statement of Income
 
Nine Months Ended September 30, 2018
 
As Reported
 
Without Adoption of ASC 606
 
Effect of Change
Higher (Lower)
 
 
 
 
 
 
Net sales
$
761,459

 
$
760,277

 
$
1,182

Cost of sales
572,359

 
572,039

 
320

Gross profit
189,100

 
188,238

 
862

Provision for income taxes
15,574

 
15,332

 
242

Net income
$
50,692

 
$
50,072

 
$
620


Consolidated Balance Sheet
 
September 30, 2018
 
As Reported
 
Without Adoption of ASC 606
 
Effect of Change
Higher (Lower)
Assets
 
 
 
 
 
Accounts receivable, net
$
180,875

 
$
174,426

 
$
6,449

Inventories
97,486

 
102,662

 
(5,176
)
Total current assets
532,723

 
531,450

 
1,273

Total assets
1,053,787

 
1,052,514

 
1,273

 
 
 
 
 
 
Liabilities
 
 
 
 
 
Accrued expenses
76,268

 
75,889

 
379

Total current liabilities
191,565

 
191,186

 
379

 
 
 
 
 
 
Shareholders' equity
 
 
 
 
 
Retained earnings
325,878

 
324,984

 
894

Total shareholders' equity
582,875

 
581,981

 
894

Total liabilities and shareholders' equity
$
1,053,787

 
$
1,052,514

 
$
1,273



16



(5)
INVENTORIES

Inventories consist of the following (in thousands):
 
September 30, 2018
 
December 31, 2017
Raw material
$
51,860

 
$
42,661

Work-in-process
7,861

 
10,598

Finished goods
37,765

 
33,113

Total inventories
$
97,486

 
$
86,372


(6)    ACQUISITIONS

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 preliminary aggregate purchase consideration for the acquisition of SolarBOS was $6.5 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 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 $2.8 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 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
$
915

Working capital
828

Property, plant and equipment
547

Acquired intangible assets
1,450

Other assets
13

Other liabilities
(51
)
Goodwill
2,838

Fair value of purchase consideration
$
6,540


The intangible assets acquired in this acquisition consisted of the following (in thousands):
 
Fair Value
 
Estimated
Useful Life
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, and these costs were recognized as a component of selling, general and administrative expenses in the consolidated statements of income. Acquisition-related costs were $0.5 million, for both the three and nine months ended September 30, 2018.


17


On February 22, 2017, the Company acquired all of the outstanding stock of Package Concierge. Package Concierge is a leading provider of multifamily electronic package delivery locker systems in the United States.

The acquisition of Package Concierge is expected to enable the Company to expand its position in the fast-growing package delivery solutions market. The results of Package Concierge have been included in the Company's consolidated financial results since the date of acquisition (within the Company's Residential Products segment). The final aggregate purchase consideration for the acquisition of Package Concierge was $18.9 million.

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 $16.8 million, which is not 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 building products 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
$
590

Working capital
(1,998
)
Property, plant and equipment
55

Acquired intangible assets
3,600

Other assets
8

Deferred income taxes
(128
)
Goodwill
16,790

Fair value of purchase consideration
$
18,917


The intangible assets acquired in this acquisition consisted of the following (in thousands):
 
Fair Value
 
Estimated
Useful Life
Trademarks
$
600

 
Indefinite
Technology
1,300

 
10 years
Customer relationships
1,700

 
7 years
Total
$
3,600

 
 

The acquisition of Package Concierge was funded from available cash on hand. The Company incurred certain acquisition-related costs composed of legal and consulting fees, and these costs were recognized as a component of selling, general and administrative expenses in the consolidated statements of income. Acquisition-related costs were $31 thousand and $146 thousand for the three and nine months ended September 30, 2017, respectively.



18


(7)
GOODWILL AND RELATED INTANGIBLE ASSETS

Goodwill
The changes in the carrying amount of goodwill for the nine months ended September 30, 2018 are as follows (in thousands):
 
Residential
Products
 
Industrial and
Infrastructure
Products
 
Renewable Energy & Conservation
 
Total
Balance at December 31, 2017
$
198,075

 
$
54,280

 
$
68,719

 
$
321,074

Acquired goodwill

 

 
2,838

 
2,838

Adjustments to prior year acquisitions

 
(38
)
 

 
(38
)
Foreign currency translation

 
(165
)
 
(388
)
 
(553
)
Balance at September 30, 2018
$
198,075

 
$
54,077

 
$
71,169

 
$
323,321


Acquired Intangible Assets
Acquired intangible assets consist of the following (in thousands):
 
September 30, 2018
 
December 31, 2017
 
 
 
Gross
Carrying
Amount
 
Accumulated
Amortization
 
Gross
Carrying
Amount
 
Accumulated
Amortization
 
Estimated 
Life
Indefinite-lived intangible assets:
 
 
 
 
 
 
 
 
 
Trademarks
$
45,096

 
$

 
$
45,107

 
$

 
Indefinite
Finite-lived intangible assets:
 
 
 
 
 
 
 
 
 
Trademarks
6,148

 
3,397

 
5,876

 
3,062

 
3 to 15 Years
Unpatented technology
28,644

 
13,406

 
28,107

 
12,033

 
5 to 20 Years
Customer relationships
70,593

 
34,626

 
80,707

 
39,652

 
5 to 17 Years
Non-compete agreements
1,649

 
1,156

 
1,649

 
931

 
4 to 10 Years
 
107,034

 
52,585

 
116,339

 
55,678

 
 
Total acquired intangible assets
$
152,130

 
$
52,585

 
$
161,446

 
$
55,678

 
 

The Company recognized impairment charges related to a finite-lived intangible asset for the three and nine months ended September 30, 2018 of $1.3 million. The charge relates to the discontinuation of lower margin sales in the Residential Products segment.

The following table summarizes the acquired intangible asset amortization expense for the three and nine months ended September 30 (in thousands):
 
Three Months Ended 
 September 30,
 
Nine Months Ended 
 September 30,
 
2018
 
2017
 
2018
 
2017
Amortization expense
$
2,121

 
$
2,208

 
$
6,408

 
$
6,600


Amortization expense related to acquired intangible assets for the remainder of fiscal 2018 and the next five years thereafter is estimated as follows (in thousands):
 
2018
 
2019
 
2020
 
2021
 
2022
 
2023
Amortization expense
$
1,960

 
$
7,841

 
$
7,329

 
$
6,726

 
$
6,315

 
$
5,776



19



(8)
LONG-TERM DEBT

Long-term debt consists of the following (in thousands):
 
September 30, 2018
 
December 31, 2017
Senior Subordinated 6.25% Notes
$
210,000

 
$
210,000

Other debt
2,000

 
2,400

Less unamortized debt issuance costs
(1,791
)
 
(2,379
)
Total debt
210,209

 
210,021

Less current maturities
400

 
400

Total long-term debt
$
209,809

 
$
209,621

The Company's Fifth Amended and Restated Credit Agreement dated December 9, 2015 (the "Senior Credit Agreement") was amended to convert our secured asset based credit facility into a secured cash flow revolver, and terminates on December 9, 2020.
The Senior Credit Agreement provides for a revolving credit facility and letters of credit in an aggregate amount of $300 million. The Company has the option to request additional financing from the banks to either increase the revolving credit facility to $500 million or to provide a term loan of up to $200 million. The Senior Credit Agreement contains three financial covenants. As of September 30, 2018, the Company is in compliance with all three covenants.
Borrowings under the Senior Credit Agreement are secured by the trade receivables, inventory, personal property, equipment, and certain real property of the Company’s significant domestic subsidiaries. Interest rates on the revolving credit facility are based on the LIBOR plus an additional margin that ranges from 1.25% to 2.25% for LIBOR loans based on the Total Leverage Ratio.
In addition, the revolving credit facility is subject to an undrawn commitment fee ranging between 0.20% and 0.30% based on the Total Leverage Ratio and the daily average undrawn balance.
Standby letters of credit of $9.5 million have been issued under the Senior Credit Agreement on behalf of the Company as of September 30, 2018. These letters of credit reduce the amount otherwise available under the revolving credit facility. As of September 30, 2018, the Company had $290.5 million of availability under the revolving credit facility. No borrowings were outstanding under the revolving credit facility at September 30, 2018 and December 31, 2017.
On January 31, 2013, the Company issued $210 million of 6.25% Senior Subordinated Notes ("6.25% Notes") due February 1, 2021.The provisions of the 6.25% Notes include, without limitation, restrictions on indebtedness, liens, and distributions from restricted subsidiaries, asset sales, affiliate transactions, dividends, and other restricted payments. Dividend payments are subject to annual limits and interest is paid semiannually on February 1 and August 1 of each year.


20


(9)
ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME

The following tables summarize the cumulative balance of each component of accumulated other comprehensive loss, net of tax, for the nine months ended September 30, (in thousands):
 
Foreign Currency Translation Adjustment
 
Minimum 
Pension
Liability
Adjustment
 
Unamortized Post Retirement Health
Care Costs
 
Total Pre-Tax Amount
 
Tax (Benefit) Expense
 
Accumulated  Other
Comprehensive
(Loss) Income
Balance at December 31, 2017
$
(2,698
)
 
$
171

 
$
(2,809
)
 
$
(5,336
)
 
$
(970
)
 
$
(4,366
)
Cumulative effect of accounting change (see Note 2)

 
15

 
(365
)
 
(350
)
 

 
(350
)
Minimum pension and post retirement health care plan adjustments

 
(7
)
 
44

 
37

 
10

 
27

Foreign currency translation adjustment
110

 

 

 
110

 

 
110

Balance at March 31, 2018
$
(2,588
)
 
$
179

 
$
(3,130
)
 
$
(5,539
)
 
$
(960
)
 
$
(4,579
)
Minimum pension and post retirement health care plan adjustments

 
(7
)
 
44

 
37

 
11

 
$
26

Foreign currency translation adjustment
(1,787
)
 

 

 
(1,787
)
 

 
$
(1,787
)
Balance at June 30, 2018
$
(4,375
)
 
$
172

 
$
(3,086
)
 
$
(7,289
)
 
$
(949
)
 
$
(6,340
)
Minimum pension and post retirement health care plan adjustments

 
(7
)
 
44

 
37

 
10

 
27

Foreign currency translation adjustment
139

 

 

 
139

 

 
139

Balance at September 30, 2018
$
(4,236
)
 
$
165

 
$
(3,042
)

$
(7,113
)

$
(939
)
 
$
(6,174
)

 
Foreign Currency Translation Adjustment
 
Minimum 
Pension
Liability
Adjustment
 
Unamortized Post Retirement Health
Care Costs
 
Total Pre-Tax Amount
 
Tax (Benefit) Expense
 
Accumulated  Other
Comprehensive
(Loss) Income
Balance at December 31, 2016
$
(5,848
)
 
$
197

 
$
(3,150
)
 
$
(8,801
)
 
$
(1,080
)
 
$
(7,721
)
Minimum pension and post retirement health care plan adjustments

 
(5
)
 
48

 
43

 
17

 
26

Foreign currency translation adjustment
$
679

 
$

 
$

 
$
679

 
$

 
$
679

Balance at March 31, 2017
(5,169
)
 
192

 
(3,102
)
 
(8,079
)
 
(1,063
)
 
$
(7,016
)
Minimum pension and post retirement health care plan adjustments
$

 
$
(4
)
 
$
47

 
$
43

 
$
16

 
$
27

Foreign currency translation adjustment
1,091

 

 

 
1,091

 

 
1,091

Balance at June 30, 2017
(4,078
)
 
188

 
(3,055
)
 
(6,945
)
 
(1,047
)
 
(5,898
)
Minimum pension and post retirement health care plan adjustments
$

 
$
(4
)
 
$
47

 
$
43

 
$
16

 
$
27

Foreign currency translation adjustment
$
1,581

 
$

 
$

 
$
1,581

 
$

 
$
1,581

Balance at September 30, 2017
$
(2,497
)
 
$
184

 
$
(3,008
)
 
$
(5,321
)
 
$
(1,031
)
 
$
(4,290
)

The realized adjustments relating to the Company’s minimum pension liability and post retirement health care costs were reclassified from accumulated other comprehensive loss and included in other expense in the consolidated statements of income.

(10)
EQUITY-BASED COMPENSATION

21


On May 4, 2018, the shareholders of the Company approved the adoption of the Gibraltar Industries, Inc. 2018 Equity Incentive Plan (the "2018 Plan"). The 2018 Plan provides for the issuance of up to 1,000,000 shares of common stock and supplements the remaining shares available for issuance under the existing Gibraltar Industries, Inc. 2015 Equity Incentive Plan (the "2015 Plan"). Both the 2018 Plan and the 2015 Plan allow the Company to grant equity-based incentive compensation awards, in the form of non-qualified options, restricted shares, restricted stock units, performance shares, performance stock units, and stock rights, to eligible participants.
In 2016, the shareholders of the Company approved the adoption of the Gibraltar Industries, Inc. 2016 Stock Plan for Non-Employee Directors ("Non-Employee Directors Plan") which allows the Company to grant awards of shares of the Company's common stock to non-employee Directors of the Company and permits the Directors to defer receipt of such shares pursuant to the terms of the Non-Employee Directors Plan.

Equity Based Awards - Settled in Stock
The following table sets forth the number of equity-based awards granted during the nine months ended September 30, which will convert to shares upon vesting, along with the weighted average grant date fair values:
 
2018
 
2017
Awards
Number of
Awards (1)
 
Weighted
Average
Grant Date
Fair Value
 
Number of
Awards (2)
 
Weighted
Average
Grant Date
Fair Value
Performance stock units
135,540

 
$
33.60

 
108,748

 
$
42.72

Restricted stock units
95,674

 
$
36.81

 
120,048

 
$
37.14

Options

 
$

 
25,000

 
$
42.35

Deferred stock units
10,255

 
$
35.96

 
10,170

 
$
34.42

Common shares
2,113

 
$
35.50

 
2,034

 
$
34.42

(1) Performance stock units granted will convert to shares based on the Company's actual return on invested capital ("ROIC") relative to the ROIC targeted for the performance period ended December 31, 2018.
(2) Performance stock units granted include 78,482 units awarded in February 2017 which will convert to 23,546 shares to be issued in February 2020, representing 30% of the targeted 2017 award, based on the Company’s actual ROIC compared to ROIC target for the performance period ended December 31, 2017. The remaining performance stock units granted include 20,000 units awarded in February 2017 and 10,266 units awarded in April 2017. The number of these shares to be issued to the recipients will be determined based upon the ranking of the Company