UFP INDUSTRIES INC [UFPI] Filings

10-Q 1 ufpi-20220924x10q.htm 10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


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

For the quarterly period ended September 24, 2022


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

Commission File Number 0-22684

UFP INDUSTRIES, INC.

(Exact name of registrant as specified in its charter)


	Michigan		38-1465835
	(State or other jurisdiction of incorporation or		(I.R.S. Employer Identification Number)
	organization)

	2801 East Beltline NE, Grand Rapids, Michigan		49525
	(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code (616) 364-6161


	NONE
	(Former name or former address, if changed since last report.)

Indicate by checkmark 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 checkmark 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 the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.


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 a new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by checkmark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act). Yes ☐ No ⌧

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:


	Class		Outstanding as of September 24, 2022
	Common stock, $1 par value		61,637,514


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, no par value	UFPI	The Nasdaq Stock Market, LLC

Table of Contents

UFP INDUSTRIES, INC.

TABLE OF CONTENTS

PART I.		FINANCIAL INFORMATION.	Page No.

	Item 1.	Financial Statements	3

		Condensed Consolidated Balance Sheets at September 24, 2022, December 25, 2021 and September 25, 2021	3

		Condensed Consolidated Statements of Earnings and Comprehensive Income for the Three and Nine Months Ended September 24, 2022 and September 25, 2021	4

		Condensed Consolidated Statements of Shareholders’ Equity for the Three and Nine Months Ended September 24, 2022 and September 25, 2021	5

		Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 24, 2022 and September 25, 2021	7

		Notes to Unaudited Condensed Consolidated Financial Statements	8

	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	18

	Item 3.	Quantitative and Qualitative Disclosures about Market Risk	36

	Item 4.	Controls and Procedures	36

PART II.		OTHER INFORMATION

	Item 1.	Legal Proceedings – NONE

	Item 1A.	Risk Factors - NONE	37

	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	37

	Item 3.	Defaults upon Senior Securities – NONE

	Item 4.	Mine Safety Disclosures – NONE

	Item 5.	Other Information – NONE	37

	Item 6.	Exhibits	37

Table of Contents

UFP INDUSTRIES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)


(in thousands, except share data)
	September 24,		December 25,		September 25,
	2022		2021		2021
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	449,135	$	286,662	$	138,637
Restricted cash		729		4,561		17,592
Investments		33,113		36,495		33,723
Accounts receivable, net		877,776		737,805		783,959
Inventories:
Raw materials		425,765		416,043		368,185
Finished goods		581,118		547,277		532,480
Total inventories		1,006,883		963,320		900,665
Refundable income taxes		28,771		4,806		14,134
Other current assets		39,956		39,827		34,040
TOTAL CURRENT ASSETS		2,436,363		2,073,476		1,922,750
DEFERRED INCOME TAXES		3,139		3,462		2,330
RESTRICTED INVESTMENTS		19,552		19,310		18,925
RIGHT OF USE ASSETS		101,001		96,703		94,481
OTHER ASSETS		94,090		31,876		29,168
GOODWILL		319,183		315,038		292,318
INDEFINITE-LIVED INTANGIBLE ASSETS		7,332		7,369		7,380
OTHER INTANGIBLE ASSETS, NET		113,880		109,017		93,984
PROPERTY, PLANT AND EQUIPMENT:
Property, plant and equipment		1,323,896		1,212,113		1,156,070
Less accumulated depreciation and amortization		(679,889)		(623,093)		(603,159)
PROPERTY, PLANT AND EQUIPMENT, NET		644,007		589,020		552,911
TOTAL ASSETS		3,738,547		3,245,271		3,014,247
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Cash overdraft	$	4,174	$	17,030	$	10,812
Accounts payable		323,404		319,125		292,933
Accrued liabilities:
Compensation and benefits		298,384		289,196		249,242
Other		111,596		84,853		90,348
Current portion of lease liability		23,767		23,155		22,242
Current portion of long-term debt		41,536		42,683		93
TOTAL CURRENT LIABILITIES		802,861		776,042		665,670
LONG-TERM DEBT		275,417		277,567		310,119
LEASE LIABILITY		80,903		76,632		75,548
DEFERRED INCOME TAXES		62,436		60,964		39,198
OTHER LIABILITIES		40,628		37,497		46,238
TOTAL LIABILITIES		1,262,245		1,228,702		1,136,773
TEMPORARY EQUITY:
Redeemable noncontrolling interest	$	7,563	$	—	$	—
SHAREHOLDERS’ EQUITY:
Controlling interest shareholders’ equity:
Preferred stock, no par value; shares authorized 1,000,000; issued and outstanding, none	$	—	$	—	$	—
Common stock, $1 par value; shares authorized 160,000,000; issued and outstanding, 61,637,514, 61,901,851 and 61,887,770		61,638		61,902		61,888
Additional paid-in capital		284,025		243,995		239,563
Retained earnings		2,102,764		1,678,121		1,552,593
Accumulated other comprehensive loss		(11,348)		(5,405)		(3,278)
Total controlling interest shareholders’ equity		2,437,079		1,978,613		1,850,766
Noncontrolling interest		31,660		37,956		26,708
TOTAL SHAREHOLDERS’ EQUITY		2,468,739		2,016,569		1,877,474
TOTAL LIABILITIES, TEMPORARY EQUITY AND SHAREHOLDERS’ EQUITY	$	3,738,547	$	3,245,271	$	3,014,247

See notes to consolidated condensed financial statements.

Table of Contents

UFP INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

AND COMPREHENSIVE INCOME

(Unaudited)


(in thousands, except per share data)
	Three Months Ended				Nine Months Ended
	September 24,		September 25,		September 24,		September 25,
	2022		2021		2022		2021
NET SALES	$	2,322,855	$	2,093,784	$	7,713,042	$	6,619,329
COST OF GOODS SOLD		1,872,679		1,766,229		6,281,051		5,583,926
GROSS PROFIT		450,176		327,555		1,431,991		1,035,403
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES		214,327		169,467		649,015		504,104
OTHER (GAINS) LOSS, NET		(1,195)		(10,037)		1,341		(11,248)
EARNINGS FROM OPERATIONS		237,044		168,125		781,635		542,547
INTEREST EXPENSE		3,516		3,433		10,213		10,483
INTEREST AND INVESTMENT LOSS (INCOME)		1,658		371		6,905		(3,614)
EQUITY IN EARNINGS OF INVESTEE		1,208		946		2,740		2,411
		6,382		4,750		19,858		9,280
EARNINGS BEFORE INCOME TAXES		230,662		163,375		761,777		533,267
INCOME TAXES		58,561		37,628		188,692		127,909
NET EARNINGS		172,101		125,747		573,085		405,358
LESS NET EARNINGS ATTRIBUTABLE TO NONCONTROLLING INTEREST		(4,860)		(4,706)		(13,023)		(7,624)
NET EARNINGS ATTRIBUTABLE TO CONTROLLING INTEREST	$	167,241	$	121,041	$	560,062	$	397,734

EARNINGS PER SHARE – BASIC	$	2.68	$	1.94	$	8.93	$	6.40
EARNINGS PER SHARE – DILUTED	$	2.66	$	1.94	$	8.89	$	6.38

OTHER COMPREHENSIVE INCOME:
NET EARNINGS		172,101		125,747		573,085		405,358
OTHER COMPREHENSIVE LOSS		(4,477)		(2,024)		(5,676)		(1,500)
COMPREHENSIVE INCOME		167,624		123,723		567,409		403,858
LESS COMPREHENSIVE INCOME ATTRIBUTABLE TO NONCONTROLLING INTEREST		(4,273)		(4,496)		(13,290)		(7,608)
COMPREHENSIVE INCOME ATTRIBUTABLE TO CONTROLLING INTEREST	$	163,351	$	119,227	$	554,119	$	396,250

See notes to consolidated condensed financial statements.

Table of Contents

UFP INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(Unaudited)


(in thousands, except share and per share data)
	Controlling Interest Shareholders’ Equity
							Accumulated
			Additional				Other
	Common		Paid-In		Retained		Comprehensive		Noncontrolling				Temporary
	Stock		Capital		Earnings		Earnings		Interest		Total		Equity
Balance on December 26, 2021	$	61,902	$	243,995	$	1,678,121	$	(5,405)	$	37,956	$	2,016,569	$	—
Net earnings						189,703				3,428		193,131
Foreign currency translation adjustment								2,930		949		3,879
Unrealized loss on debt securities								(695)				(695)
Distributions to noncontrolling interest										(2,053)		(2,053)
Cash dividends - $0.20 per share - quarterly						(12,541)						(12,541)
Issuance of 9,734 shares under employee stock purchase plan		10		653								663
Issuance of 787,045 shares under stock grant programs		787		8,959								9,746
Issuance of 79,973 shares under deferred compensation plans		80		(80)								—
Repurchase of 44,442 shares		(45)				(3,499)						(3,544)
Expense associated with share-based compensation arrangements				6,883								6,883
Accrued expense under deferred compensation plans				6,134								6,134
Balance on March 26, 2022	$	62,734	$	266,544	$	1,851,784	$	(3,170)	$	40,280	$	2,218,172	$	—
Net earnings						203,118				4,735		207,853
Foreign currency translation adjustment								(3,660)		(95)		(3,755)
Unrealized loss on debt securities								(628)				(628)
Cash dividends - $0.25 per share - quarterly						(15,474)						(15,474)
Issuance of 13,875 shares under employee stock purchase plan		14		781								795
Issuance of 28,154 shares under stock grant programs		28		1,092								1,120
Issuance of 11,605 shares under deferred compensation plans		12		(12)								—
Repurchase of 1,165,268 shares		(1,165)				(88,506)						(89,671)
Expense associated with share-based compensation arrangements				5,556								5,556
Accrued expense under deferred compensation plans				1,100								1,100
Balance on June 25, 2022	$	61,623	$	275,061	$	1,950,922	$	(7,458)	$	44,920	$	2,325,068	$	—
Net earnings						167,241				4,380		171,621		480
Foreign currency translation adjustment								(3,330)		(29)		(3,359)		(558)
Unrealized loss on debt securities								(560)				(560)
Distributions to noncontrolling interest										(9,970)		(9,970)
Redeemable noncontrolling interest										(7,641)		(7,641)		7,641
Cash dividends - $0.25 per share - quarterly						(15,405)						(15,405)
Issuance of 10,678 shares under employee stock purchase plans		11		641								652
Net forfeitures of 6,396 shares under stock grant programs		(6)		(159)		6						(159)
Issuance of 10,705 shares under deferred compensation plans		10		(10)								—
Expense associated with share-based compensation arrangements				7,407								7,407
Accrued expense under deferred compensation plans				1,085								1,085
Balance on September 24, 2022	$	61,638	$	284,025	$	2,102,764	$	(11,348)	$	31,660	$	2,468,739	$	7,563

Table of Contents

UFP INDUSTRIES, INC.


(in thousands, except share and per share data)
	Controlling Interest Shareholders’ Equity
							Accumulated
			Additional				Other
	Common		Paid-In		Retained		Comprehensive		Noncontrolling
	Stock		Capital		Earnings		Earnings		Interest		Total
Balance on December 27, 2020	$	61,206	$	218,224	$	1,182,680	$	(1,794)	$	22,836	$	1,483,152
Net earnings						103,311				940		104,251
Foreign currency translation adjustment								(374)		(526)		(900)
Unrealized loss on debt securities								(1,296)				(1,296)
Distributions to noncontrolling interest										(2,914)		(2,914)
Cash dividends - $0.15 per share - quarterly						(9,274)						(9,274)
Issuance of 5,816 shares under employee stock purchase plan		6		357								363
Net issuance of 536,970 shares under stock grant programs		537		3,888		5						4,430
Issuance of 89,690 shares under deferred compensation plans		89		(89)								—
Expense associated with share-based compensation arrangements				2,936								2,936
Accrued expense under deferred compensation plans				5,795								5,795
Balance on March 27, 2021	$	61,838	$	231,111	$	1,276,722	$	(3,464)	$	20,336	$	1,586,543
Net earnings						173,382				1,978		175,360
Foreign currency translation adjustment								1,759		720		2,479
Unrealized gain on debt securities								241				241
Cash dividends - $0.15 per share - quarterly						(9,276)						(9,276)
Issuance of 9,282 shares under employee stock purchase plan		9		564								573
Net forfeitures of 5,718 shares under stock grant programs		(6)		(224)		5						(225)
Issuance of 8,913 shares under deferred compensation plans		10		(10)								—
Expense associated with share-based compensation arrangements				2,728								2,728
Accrued expense under deferred compensation plans				1,140								1,140
Balance on June 26, 2021	$	61,851	$

UFP INDUSTRIES INC [UFPI] Filings
10-Q	[2022-11-03]
10-Q	[2022-08-03]
10-Q	[2022-05-04]
10-K	[2022-02-23]
10-Q	[2021-11-03]
10-Q	[2021-08-04]
10-Q	[2021-05-05]
10-K	[2021-03-03]
10-Q	[2020-10-28]
10-Q	[2020-07-29]
10-Q	[2020-05-06]
10-K	[2020-02-26]
10-Q	[2019-10-30]
10-Q	[2019-08-07]
10-Q	[2019-05-01]
10-K	[2019-02-27]
10-Q	[2018-11-07]
10-Q	[2018-08-01]
10-Q	[2018-05-02]
10-K	[2018-02-28]
10-Q	[2017-11-01]
10-Q	[2017-08-02]
10-Q	[2017-05-03]
10-K	[2017-03-01]
10-Q	[2016-10-27]
10-Q	[2016-07-27]
10-Q	[2016-04-27]
10-K	[2016-02-24]
10-Q	[2015-10-30]
10-Q	[2015-07-29]
10-Q	[2015-05-01]
10-K	[2015-02-25]
10-Q	[2014-10-29]
10-Q	[2014-07-30]
10-Q	[2014-04-30]
10-K	[2014-02-26]
10-Q	[2013-10-30]
10-Q	[2013-08-01]
10-Q	[2013-04-30]
10-K	[2013-02-26]
10-Q	[2012-10-30]
10-Q	[2012-08-08]
10-Q	[2012-04-30]
10-K	[2012-03-14]