Apogee Enterprises, Inc.
Fiscal 2025 Annual Report
Fellow shareholders,
We completed another successful year in fiscal 2025, as our
team continued to execute our strategy. We were able to deliver
increased adjusted operating margins and record adjusted
diluted EPSi. These results capped three years of substantial
improvements in our operating and financial performance since
we introduced our new strategic direction. I want to thank the
entire Apogee team for continuing to build on our track record
of success.
Executing Our Strategy
In November 2021, we introduced our three-pillar strategy with
the goal of building a stronger foundation for long-term
profitable growth. We’ve improved our cost structure through
facility consolidation, organizational realignment, and better
leveraging the scale of our enterprise. We’ve achieved
meaningful
productivity
improvements
through
the
deployment of the Apogee Management System. We’ve
reshaped our portfolio, focusing on more differentiated, higher
margin
offerings.
We’ve
also
made
several
strategic
investments, both organic and inorganic, that position the
company for improved growth. All of this has been
underpinned by a focus on talent management and people
development, which has strengthened our team. Through these
efforts, we’ve built a much stronger operating foundation, one
that will support continued performance throughout the ups
and downs of the market cycle.
One of the highlights of the year was our acquisition of UW
Solutions. This adds a differentiated business to our portfolio
that is well positioned in attractive market segments. This
includes an industrial flooring solution that diversifies our
business by providing exposure to repair and remodel activity
in distribution centers and manufacturing facilities. Most
importantly, we’ve added a talented team of employees that
has established a strong record of profitable growth.
We are integrating UW Solutions with our legacy Large Scale
Optical business to create the newly renamed Performance
Surfaces segment. The combined business brings together a
strong set of brands, and expanded manufacturing and process
technology capabilities, to create a scalable platform for
growth. This business has a strong financial profile, and we see
a long runway for above market growth at attractive margins.
Since closing the acquisition in November 2024, we’ve made
significant progress on our integration plan, and we’re on track
to deliver the financial targets we set for the deal.
Fiscal 2025 Results
When we introduced our strategy, we set three financial targets
that we planned to achieve by fiscal 2025:
1.
Adjusted ROIC above 12%,
2.
adjusted operating margin over 10%,
3.
and outgrowing the non-residential construction
market by 1.2 times.
This year, we exceed both the ROIC and margin targets.
Adjusted ROIC was 14.9%, exceeding our 12% target for the
third consecutive year. We’ve steadily improved our adjusted
operating margin, reaching 11.0% this year, a 470-basis point
gain from fiscal 2022. Notably, we’ve achieved margin gains
across our business, with all our segments at or above their
targeted margin levels for the year.
We fell short of our growth goal. Some of this was a function of
our purposeful strategy to move away from less differentiated,
lower margin offerings. And some was driven by the dynamics
of our end markets, as industrial facilities, data centers, and
warehouses have been the primary drivers of non-residential
construction growth over the past few years. These are parts of
the market where we have historically had less presence. We are
excited that the UW Solutions acquisition expands our
opportunity to serve those market segments. As we move
forward, we will strive to sustain the ROIC and margin gains
we’ve achieved, while shifting more focus to growth.
Execution of our strategy has also driven significant growth in
operating profit and earnings per share. Adjusted operating
income increased by over 80% from fiscal 2022 to 2025, and we
more than doubled adjusted diluted EPS over that period,
achieving a record $4.97 this year.
“I am proud of the results our team delivered in fiscal 2025,
capping a tremendous three-year transformation, while
embracing new challenges and positioning the company
for our next chapter of growth.”
Ty R. Silberhorn, Chief Executive Officer
Our business has also continued to generate strong, consistent
cash flow. Over the past three years, we’ve delivered $432
million of cash flow from operations, an average of $144 million
per year. We’ve used this cash flow to pursue a balanced
approach to capital deployment. Since fiscal 2023, we’ve
returned $194 million of cash to our shareholders, by steadily
increasing our dividend and opportunistically repurchasing our
stock. We’ve invested $124 million in capital expenditures,
making investments to enable growth and profitability
improvements, and we completed the strategic acquisition of
UW Solutions. With our strong balance sheet, we see more
opportunities for value creating capital deployment in the
future.
In addition to these strong financial results, our team also
achieved significantly improved safety performance. Our
accident incident rate in calendar year 2024 was 34% lower than
the previous year, and well below industry benchmarks. These
results reflect our commitment to promote a culture of safety
across our company. Nothing we do is more important than
working safely, and we will continue to strive toward achieving
an accident-free workplace.
Looking Ahead
Leading indicators and industry forecasts point to slowing
conditions and a cautious outlook for non-residential
construction. Declining consumer sentiment may put pressure
on the consumer-facing parts of our business, and recent
developments with tariffs create additional uncertainty. Over
the past several years, our team has established a strong track
record of successfully managing through difficult market
conditions. I am confident that we will navigate through the
current situation as well.
We are approaching fiscal 2026 by balancing the imperative for
near-term performance with continuing to invest in long-term
growth opportunities. We will work to manage what we can
control, creating some certainty in an uncertain environment. A
key part of this will be maintaining our focus on execution,
productivity, and cost management. These have been central to
everything we’ve accomplished over the past few years. This will
include changes to further optimize our footprint and better
align our operations and cost structure with current market
conditions.
While we take actions to ensure near-term performance, we
also remain focused on positioning the company for growth.
We will leverage the acquisition of UW Solutions to develop
new growth opportunities, as well as leverage recent capacity
investments in Performance Surfaces and Architectural Services
to drive organic growth. Finally, we will continue to actively
pursue our M&A pipeline, looking for opportunities to add
offerings and capabilities that further diversify our business and
increase our growth potential.
I am proud of the results our team delivered in fiscal 2025,
capping a tremendous three-year transformation, while
embracing new challenges and positioning the company for our
next chapter of growth. On behalf of our entire team and Board
of Directors, I want to thank you for your continued support of
Apogee Enterprises.
Ty Silberhorn
Chief Executive Officer and President
i This letter includes measures of financial performance that are not defined by GAAP, including adjusted diluted EPS, adjusted operating income,
adjusted operating margin, and adjusted return on invested capital (ROIC). We provide a reconciliation of the differences between these historical non-
GAAP measures and the most directly comparable GAAP measures in Item 7 of our Annual Report on Form 10-K for the fiscal year ended March 1, 2025.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_________________________________
FORM 10-K
_________________________________
☒
ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended March 1, 2025
☐
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: 0-6365
_________________________________
APOGEE ENTERPRISES, INC.
(Exact name of registrant as specified in its charter)
_________________________________
Minnesota
41-0919654
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)
4400 West 78th Street
Suite 520
Minneapolis
Minnesota
55435
(Address of principal executive offices)
(Zip Code)
Registrant’s telephone number, including area code: (952) 835-1874
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock, $0.33 1/3 Par Value
APOG
The Nasdaq Stock Market
Securities registered pursuant to Section 12(g) of the Act: None
________________________________
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
☒ Yes ☐ No
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
☐ Yes ☒ No
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 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, 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 any new or revised financial accounting standards provided pursuant to
Section 13(a) of the Exchange Act.
☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the
effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C.
7262(b)) by the registered public accounting firm that prepared or issued its audit report.
☒
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the
registrant included in the filing reflect the correction of an error to previously issued financial statements.
☐
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-
based compensation received by any of the registrant's executive officers during the relevant recovery period pursuant to
§240.10D-1(b).
☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
☐ Yes ☒ No
As of August 30, 2024, the last business day of the registrant's most recently completed second fiscal quarter, the approximate
aggregate market value of voting and non-voting common equity held by non-affiliates of the registrant was $1,432,300,000
(based on the closing price of $66.78 per share as reported on The Nasdaq Stock Market as of that date).
As of April 18, 2025, 21,419,290 shares of the registrant’s common stock, par value $0.33 1/3 per share, were outstanding.
DOCUMENTS INCORPORATED BY REFERENCE:
In accordance with General Instruction G(3) of Form 10-K, certain information required by Part III hereof will either be
incorporated into this Annual Report on Form 10-K by reference to our Definitive Proxy Statement for our Annual Meeting of
Shareholders filed within 120 days of our fiscal year ended March 1, 2025 or will be included in an amendment to this Annual
Report on Form 10-K filed within 120 days of March 1, 2025.
APOGEE ENTERPRISES, INC.
Annual Report on Form 10-K
For the fiscal year ended March 1, 2025
TABLE OF CONTENTS
Page
PART I
Item 1.
Business
5
Item 1A.
Risk Factors
11
Item 1B.
Unresolved Staff Comments
16
Item 1C.
Cybersecurity
17
Item 2.
Properties
18
Item 3.
Legal Proceedings
19
Item 4.
Mine Safety Disclosures
19
PART II
Item 5.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
20
Item 6.
Reserved
21
Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
22
Item 7A.
Quantitative and Qualitative Disclosures About Market Risk
37
Item 8.
Financial Statements and Supplementary Data
38
Item 9.
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
77
Item 9A.
Controls and Procedures
78
Item 9B.
Other Information
78
Item 9C.
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
78
PART III
Item 10.
Directors, Executive Officers, Code of Ethics and Corporate Governance
78
Item 11.
Executive and Director Compensation
79
Item 12.
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
79
Item 13.
Certain Relationships and Related Transactions, and Director Independence
79
Item 14.
Principal Accountant Fees and Services
79
PART IV
Item 15.
Exhibits and Financial Statement Schedules
79
Item 16.
Form 10-K Summary
82
Signatures
83
3
Forward-Looking Statements
This Annual Report on Form 10-K, including “Management's Discussion and Analysis of Financial Condition and Results of
Operations” in Part II, Item 7, contains certain statements that are considered “forward-looking statements” within the meaning
of the Private Securities Litigation Reform Act of 1995. These statements reflect our current views with respect to future events
and financial performance. Forward-looking statements generally can be identified by the use of forward-looking terminology
such as “may,” “believe,” “expect,” “anticipate,” “intend,” “estimate,” “forecast,” “project,” “should,” "will," "continue" or
similar words or expressions. All forecasts and projections in this document are “forward-looking statements,” and are based on
management's current expectations or beliefs of the Company's near-term results, based on current information available
pertaining to the Company, including the risk factors noted under Item 1A in this Form 10-K. From time to time, we also may
provide oral and written forward-looking statements in other materials we release to the public, such as press releases,
presentations to securities analysts or investors, or other communications by the Company. Any or all of our forward-looking
statements in this report and in any public statements we make could be materially different from actual results.
Accordingly, we wish to caution investors that any forward-looking statements made by or on behalf of the Company are
subject to uncertainties and other factors that could cause actual results to differ materially from such statements. These
uncertainties and other risk factors include, but are not limited to, the risks and uncertainties set forth under Item 1A in this
Form 10-K, all of which are incorporated by reference into Item 7.
We wish to caution investors that other factors might in the future prove to be important in affecting the Company's results of
operations. New factors emerge from time to time; it is not possible for management to predict all such factors, nor can it assess
the impact of each such factor on the business or the extent to which any factor, or a combination of factors, may cause actual
results to differ materially from those contained in any forward-looking statements. We undertake no obligation to update
publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
4
PART I
ITEM 1. BUSINESS
The Company
Apogee Enterprises, Inc. (Apogee, we, us, our or the Company) was incorporated under the laws of the State of Minnesota in
1949. We are a leading provider of architectural building products and services, as well as high-performance coated materials
used in a variety of applications.
Segment Information
During the fourth quarter of fiscal 2025, the Company changed the names of two of our reporting segments to better reflect
their product focus and capabilities. The previously named Architectural Framing Systems Segment is now referred to as the
Architectural Metals Segment. The previously named Large-Scale Optical Segment is now referred to as the Performance
Surfaces Segment. There were no changes in the products or brands included within each of the reportable segments, nor the
way in which our CEO assesses performance and allocates resources for these or our other segments.
We have four reporting segments:
•
The Architectural Metals Segment designs, engineers, fabricates and finishes aluminum window, curtainwall, storefront
and entrance systems used primarily in non-residential construction. In fiscal 2025, this segment accounted for
approximately 39% of our net sales.
•
The Architectural Services Segment integrates technical services, project management, and field installation services to
design, engineer, fabricate, and install architectural curtainwall and other façade-related systems used primarily in non-
residential construction. In fiscal 2025, this segment accounted for approximately 31% of our net sales.
•
The Architectural Glass Segment cuts, treats, coats and fabricates high-performance glass used in custom window and
wall systems used primarily in non-residential buildings. In fiscal 2025, this segment accounted for approximately 21%
of our net sales.
•
The Performance Surfaces Segment develops and manufactures high-performance coated materials for a variety of
applications, including wall decor, museums, graphic design, digital displays, architectural interiors, and industrial
flooring. In fiscal 2025, this segment accounted for approximately 9% of our net sales.
Strategy
Our enterprise strategy is based on the following three key elements:
1.
Become the economic leader in our target markets. We have developed a deep understanding of our target markets
and aligned our businesses with clear go-to-market strategies to drive value for our customers through differentiated
product and service offerings. We are focused on operational execution, driving productivity improvements, and
maintaining a competitive cost structure, so that we may bring more value to our customers and improve our own
profitability.
2.
Actively manage our portfolio to drive higher margins and returns. We are shifting our business mix toward
higher operating margin offerings in order to improve our return on invested capital performance. We accomplish this
by allocating resources to grow our top performing businesses, actively addressing underperforming businesses, and
investing in differentiated product and service offerings to accelerate our growth and increase margins.
3.
Strengthen our core capabilities. We are shifting from our historical, decentralized operating model, to one with
center-led functional expertise that enables us to leverage the scale of the enterprise to better support the needs of the
business. We have established a Company-wide operating system with common tools and processes based on the
foundation of Lean and Continuous Improvement, which we call the "Apogee Management System." Our strategy is
supported by a robust talent management program and a commitment to strong governance to ensure compliance and
drive sustainable performance.
We continually analyze our current portfolio of products, services, and capabilities to identify the best areas for future profitable
growth. We also evaluate inorganic investment opportunities where we can deploy capital to acquire businesses that will be
accretive to our long-term growth rate and operating margins.
5
Fiscal 2025 Highlights
In fiscal 2025, we drove further progress toward our strategic goals and financial targets. We continued the deployment of the
Apogee Management System across our business, supporting sustainable cost and productivity improvements. We invested in
organic and inorganic growth initiatives, including the acquisition of UW Interco, LLC (UW Solutions) and capacity expansion
in the Performance Surfaces segment as well as capacity expansion to support geographic growth in the Architectural Services
segment. We continue to focus on offering differentiated products and services and diversifying the mix of architectural
projects that we serve. We also advanced several initiatives to strengthen our core capabilities, driving the standardization of
key business processes and systems, and strengthening talent management and leadership development programs.
Products and Services
Architectural Metals Segment
Our Architectural Metals Segment designs, engineers and fabricates aluminum windows, curtainwall, storefront and entrance
systems. We also extrude aluminum and provide finishing services for metal components used in a variety of building materials
applications. We sell our products and services under the Tubelite®, EFCO, and Linetec® brands in the U.S. and under
Alumicor™ in Canada.
Architectural Services Segment
Our Architectural Services Segment delivers value by integrating technical capabilities, project management skills and field
installation services, to provide design, engineering, fabrication and installation for the exteriors of primarily non-residential
buildings. Our ability to efficiently design high-quality window and curtainwall systems and effectively manage the installation
of building façades enables our customers to meet schedule and cost requirements of their projects. We sell our products and
services under the Harmon® brand.
Architectural Glass Segment
Our Architectural Glass Segment provides a wide range of high-performance glass products, offering customized solutions that
enable architects and building owners to meet their design, aesthetic, and performance goals. We fabricate insulating,
laminated, and monolithic glass units that are used in windows, curtainwall, storefront, and entrance systems. We provide
premium glass solutions to meet our customers’ design and energy-performance requirements. These include proprietary, high-
performance coatings, digital and silkscreen printing, heat-soaking of tempered glass, and thermal spacers. We sell our products
under the Viracon® and GlassecViracon® brands.
Performance Surfaces Segment
The Performance Surfaces Segment develops and manufactures high-performance coated materials for a variety of applications,
including wall decor, museums, graphic design, digital displays, architectural interiors, and industrial flooring. We are a
vertically integrated manufacturer, differentiated by our proprietary formulations and coating application processes. We sell our
products under the Tru Vue®, ResinDEK®, ChromaLuxe®, RDC Coatings™, and Unisub® brands.
6
Product Demand and Distribution Channels
Architectural Metals, Architectural Services and Architectural Glass Segments
Demand for the products and services offered by our architectural segments is not only impacted by general economic
conditions, but has historically been affected by changes in the North American non-residential construction industry, which is
cyclical in nature.
We look to several external indicators to analyze potential demand for our products and services, such as U.S. and Canadian job
growth, office vacancy rates, credit and interest rates, architectural billing indices, and material costs. We also rely on internal
indicators to analyze demand, including our sales pipeline, which is made up of contracts in review, projects awarded or
committed, and bidding activity. Our sales pipeline, together with ongoing feedback, analysis and data from our customers,
architects and building owners, provides information related to near- and mid-term demand. Additionally, we evaluate data on
U.S. and Canadian non-residential construction market activity, industry analysis, interest rates, and other longer-term trends
provided by external data sources.
Our architectural products and services are used in subsets of the non-residential construction industry differentiated by the
following factors:
•
Building type - Our products and services are primarily used in commercial buildings (office buildings, hotels and
retail centers), institutional buildings (education facilities, health care facilities and government buildings),
transportation facilities (airports and transit terminals), and multi-family residential buildings (a subset of residential
construction).
•
Level of customization - Many of our projects involve a high degree of customization, as the product or service is
designed or fabricated to meet customer-specified requirements for aesthetics, performance and size, and local
building codes.
•
Customers and distribution channels - Our customers are mainly glazing subcontractors and general contractors, with
project design being influenced by architects and building owners. Our windows, curtainwall, storefront and entrance
systems are sold using a combination of direct sales forces, independent sales representatives, and distributors. Our
installation services are sold by a direct sales force in certain metropolitan areas in the U.S and Canada. Our high-
performance architectural glass is sold using both a direct sales force and independent sales representatives.
•
Geographic location - We primarily supply architectural glass products and aluminum framing systems, including
window, curtainwall, storefront and entrance systems, to customers in North America. We are one of only a few
architectural glass installation service companies in the U.S. to have a national presence and we have the ability to
provide installation project management throughout the U.S. and Canada.
Performance Surfaces Segment
Demand for our products in our Performance Surfaces Segment is impacted by general economic conditions, including
consumer confidence, spending in residential improvements, as well as growth in non-residential construction. We offer value-
added coated glass, acrylic, metals, and other substrates used in the custom picture-framing market, museum market, graphic
arts and decor markets, and various technical glass applications. These products are sold primarily in North America under the
Tru Vue, ChromaLuxe, and Unisub brands, through national and regional retail chains using a direct sales force, as well as to
local retailers through an independent distribution network. Through our ResinDEK brand, we offer engineered panels used in
flooring systems designed for material handling, supply chain, and self-storage applications. These products are sold through a
combination of a direct sales force and third-party representatives. Our RDC Coatings brand offers coating solutions for a
variety of applications, that are custom engineered to meet customer specifications. Markets for these coatings include flooring,
furniture, cabinetry, and other applications. We have a global distribution network and supply our products to customers outside
of North America, primarily in Europe and Asia.
Competitive Conditions
The North American non-residential construction market is highly fragmented. Competitive factors include price, product
quality, product attributes and performance, reliable service, on-time delivery, lead-time, warranties, and the ability to provide
project management, technical engineering and design services. To protect and improve our competitive position, we maintain
strong relationships with building owners, architects, and other stakeholders who influence the selection of products and
services on a project, and with general contractors, who initiate projects and develop specifications.
7
Architectural Metals Segment
Our Architectural Metals Segment competes against several national, regional, and local aluminum window and storefront
manufacturers, as well as regional finishing companies. Our businesses compete by providing a broad portfolio of high-quality
products, robust engineering capabilities, a vertically integrated manufacturing model, and dependable, short lead-time service.
Architectural Services Segment
Our Architectural Services Segment competes against international, national and regional glass installation companies. We
compete by offering a robust set of capabilities at a competitive cost. Our capabilities include engineering and design services,
project management, manufacturing, and field installation. We deliver these services using an operating model that is designed
to reduce costs and risk for our customers.
Architectural Glass Segment
In our Architectural Glass Segment, we compete with regional glass fabricators and international competitors who can provide
certain products with attributes similar to ours. We differentiate by providing a wider range of high-quality products, including
several proprietary offerings, that we can bundle together into customized solutions. We work to maintain strong relationships
with architects, developers, and other industry stakeholders, and provide strong customer service and reliable delivery.
Performance Surfaces Segment
Our Performance Surfaces Segment competes primarily with European, U.S., and Asia Pacific providers of both basic and
value-added glass and acrylic, and other high-performance coated substrates. Our competitive strengths include innovative
proprietary products, domain expertise in coating processes and technologies, a highly automated manufacturing model, strong
customer relationships, an established distribution network, and a portfolio of well-known brands.
Warranties
We offer product and service warranties that we believe are competitive for the markets in which our products and services are
sold. The nature and extent of these warranties depend upon the product or service, the market and, in some cases, the customer
being served. Our standard warranties are generally from two to 12 years for our curtainwall, window system, and architectural
glass and certain coated products, while we generally offer warranties of two years or less on our other products and services.
Sources and Availability of Raw Materials
Materials used in the Architectural Metals Segment include aluminum billet and extrusions, fabricated glass, plastic extrusions,
hardware, paint and chemicals. Within the Architectural Services Segment, materials used include fabricated glass, finished
aluminum extrusions, fabricated metal panels and hardware. Raw materials used within the Architectural Glass Segment
include float glass, vinyl, silicone sealants and lumber. Materials used in the Performance Surfaces Segment are float glass,
acrylic, aluminum sheets, medium-density fiberboard (MDF), and certain chemicals. Most of our raw materials are readily
available from a variety of domestic and international sources.
Intellectual Property
We have several patents, trademarks, trade names, trade secrets and proprietary technologies and customer relationships that we
believe constitute valuable assets, but we do not regard our business as being materially dependent on any single item or
category of intellectual property. We take measures that we believe to be appropriate to protect our intellectual property to the
extent such intellectual property can be protected.
Seasonality
Activity in the non-residential construction industry is impacted by the seasonal impact of weather and weather events in our
operating locations, with activity in some markets reduced in winter due to inclement weather.
Working Capital Requirements
Trade and contract-related receivables and other contract assets are the largest components of our working capital. Inventory
requirements, mainly related to raw materials, are most significant in our Architectural Metals, Architectural Glass, and
Performance Surfaces Segments.
Compliance with Government Regulations
We are subject to various environmental and occupational safety and health laws and regulations in the U.S. and in other
countries in which we operate. These laws and regulations relate to, among other things, our use and storage of hazardous
materials in our manufacturing operations and associated air emissions and discharges to surface and underground waters. We
have several continuing programs designed to ensure compliance with foreign, federal, state and local environmental and
occupational safety and health laws and regulations. We contract with outside vendors to collect and dispose of waste at our
production facilities in compliance with applicable environmental laws. In addition, we have procedures in place that enable us
to properly manage the regulated materials used in and wastes created by our manufacturing processes. We believe we are
currently in compliance with all such laws and regulations.
8
Supporting Sustainability
We are committed to integrating sustainable business practices and environmental stewardship throughout our business. Our
company-wide commitment to sustainable business practices is focused on delivering long-term profitable growth while
carefully stewarding the resources entrusted to us, and delivering products and services that address our customers’ increased
focus on energy efficiency, greenhouse gas reductions, and other performance requirements.
Our architectural products and services are key enablers of green building and sustainable design. We have long been at the
forefront of developing innovative products and services that conserve resources and help architects and building owners
achieve their sustainability goals, such as attaining Leadership in Energy and Environmental Design (LEED) certifications. Our
high-performance thermal framing systems, energy-efficient architectural glass, and other products are designed to help
improve building energy efficiency, reduce greenhouse gas emissions, and increase security and comfort for building
occupants. Our products are made primarily with glass and aluminum components, which are recyclable at the end of their
useful lives. In addition, many of our framing products can be specified with recycled aluminum content.
Our commitment to sustainable business practices and environmental stewardship also extends to our own operations, including
incorporating environmentally sustainable manufacturing processes, eliminating waste, and minimizing our resource
consumption.
Human Capital Resources
We had approximately 4,500 employees on March 1, 2025, up from 4,400 employees on March 2, 2024, of which 78% are
male and 22% are female. As of March 1, 2025, approximately 351, or approximately 8%, of our employees are covered by
collective bargaining agreements.
Based on the most recent information available from our latest filing with the U.S. Equal Employment Opportunity
Commission, our U.S employees had the following race and ethnicity demographics:
Employee Demographic
Percent of Total
White
66%
Hispanic / Latinx
20%
Black / African American
7%
Asian
5%
Multiracial, Native American, Native Hawaiian, and Pacific Islander
2%
Competition for qualified employees in the markets and industries in which we operate is significant, and our success depends
on the ability to attract, select, develop and retain a productive and engaged workforce. Investing in our employees and their
well-being, offering competitive compensation and benefits, promoting diversity and inclusion, and adopting positive human
capital management practices are critical components of our corporate strategy.
Health, Wellness and Safety
The safety of our employees is integral to our Company. Providing a safe and secure work environment is one of our highest
priorities and we devote significant time and resources to workplace safety. Our safety programs are designed to comply with
stringent regulatory requirements and to meet or exceed best practices in our industry. This commitment requires focus and
dedication to fundamental aspects of our business to minimize the risk of accidents, injury, and exposure to health hazards.
In fiscal 2025, we continued to improve our enterprise-wide health and safety program which centralizes oversight of
workplace safety and actively shares best practices across our business. Our Apogee Safety Council meets regularly to review
facility-level performance, maintain our policies, and provide short and long-term plans to achieve our ambition of achieving an
incident rate of zero.
We utilize a safety culture assessment process along with safety compliance audits to monitor safety programs within our
businesses and regularly share best practices. These annual assessments and audits provide suggestions for continuous
improvement in safety programs and measure employee engagement. In addition, the programs encourage the development of a
proactive, inter-dependent safety culture in which leadership and employees interact to ensure safety is viewed as everyone’s
responsibility. Our leadership team and Board of Directors are briefed regularly on our health and safety performance metrics.
We offer comprehensive health and wellness programs for our employees. In addition to standard health programs, including
medical insurance and preventive care, we have a variety of resources available to employees relating to physical and mental
wellness. We also conduct employee engagement surveys at the site level annually to hear directly from our employees with
respect to what we are doing well, in addition to areas where they may need additional support.
9
Diversity and Equal Opportunity
We strive to promote a workplace where each employee’s abilities are recognized, respected, and utilized to further our goals.
Our aim is to create an environment where people feel included as a part of a team because of their diversity of outlooks,
perspectives, and characteristics, and have an equal opportunity to add value to our Company. We work to create a culture of
inclusion, reduce bias in our talent practices, and invest in and engage with our communities. We conduct diversity and Code of
Business Ethics and Conduct trainings with employees and managers annually to define our expectations on creating an
inclusive and diverse workplace, where all individuals feel respected and part of a team regardless of their race, national origin,
ethnicity, gender, age, religion, disability, sexual orientation or gender identity.
Talent Management and Development
Our talent management program is focused on developing employees and leaders to meet our evolving needs. Employees are
able to track and manage their growth through a performance management system and managers actively engage with their
employees to provide coaching and feedback, identify training and development opportunities to improve performance in the
employee’s current role, and to position the employee for future growth. Training and development opportunities include new-
hire training, job specific training, stretch assignments, and safety training. We also offer leadership development opportunities,
along with technical training for engineers, designers and sales staff. In addition, we offer an education assistance program in
which certain eligible employees receive tuition reimbursement to help defray the costs associated with their continuing
education. Our executive leadership and Human Resources teams regularly conduct talent reviews and succession planning to
assist with meeting critical talent and leadership needs.
International Sales
Information regarding export and international sales is included in Item 8, Financial Statements and Supplementary Data,
within Note 16 of our Consolidated Financial Statements.
Available Information
Our internet address is www.apog.com. Through a link to a third-party content provider, our website provides free access to our
Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and, if applicable, amendments
to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the
Exchange Act), as soon as reasonably practicable after electronic filing such material with, or furnishing it to, the Securities and
Exchange Commission (SEC). These reports are also available on the SEC's website at www.sec.gov. Also available on our
website are various corporate governance documents, including our Code of Business Ethics and Conduct, Corporate
Governance Guidelines, and charters for the Audit, Compensation, and Nominating and Corporate Governance Committees of
the Board of Directors (the Board).
10
INFORMATION ABOUT OUR EXECUTIVE OFFICERS
Ty R. Silberhorn
57
Chief Executive Officer (CEO) of the Company since January 2021. Prior to joining the Company,
Mr. Silberhorn worked for 3M, a diversified global manufacturer and technology company, most
recently serving as Senior Vice President of 3M's Transformation, Technologies and Services from
April 2019 through December 2020. Prior to this position and since 2001, he held several 3M global
business unit leadership roles, serving as Vice President and General Manager for divisions within
Safety & Industrial, Transportation & Electronics, and the Consumer business groups.
Matthew Osberg
49
Executive Vice President and Chief Financial Officer of the Company since April 2023. Prior to
joining the Company, Mr. Osberg served as Chief Financial Officer at Helen of Troy Limited, a
global consumer products company. Previously, Mr. Osberg worked in finance roles at Best Buy Co.,
Inc. and Ernst & Young LLP.
Raelyn Trende
49
Executive Vice President and Chief Human Resources Officer since July 2024. Ms. Trende joined the
Company from Medtronic where she served as Vice President of Global Talent Acquisition, Human
Resources Technology, Analytics, and Project Management Office. Prior to Medtronic, Ms. Trende
was Senior Vice President of Human Resources for OptumHealth, a subsidiary of UnitedHealth
Group. In addition, Ms. Trende served in several human resources leadership roles at Target
Corporation and Cargill.
Meghan M. Elliott
48
Vice President, Chief Legal Officer, and Secretary of the Company since June 2020. Prior to this
role, Ms. Elliott served as Assistant General Counsel for the Company since 2014. Prior to joining
the Company, Ms. Elliott was a partner with Lindquist & Vennum, PLLP (n/k/a Ballard Spahr LLP).
Nick C. Longman
53
President of Apogee's Architectural Metals Segment since October 2023. Prior to this role, Mr.
Longman served as President of Apogee's Architectural Glass segment from June 2021 to October
2023. Prior to joining the Company, Mr. Longman served as Chief Executive Officer and Chief
Operating Officer for Harvey Building Products, a manufacturer of windows, doors and accessory
products, from March 2018 to November 2020 and in various functional and business leadership
roles at Colfax Fluid Handling, a diversified technology company, from 2012 to 2018.
Troy R. Johnson
51
President of Apogee’s Architectural Services Segment since March 2020. Prior to this role, Mr.
Johnson served in several leadership roles in the Architectural Services Segment.
Brent C. Jewell
51
President of Apogee's Architectural Glass Segment since October 2023. Prior to this role, Mr. Jewell
served as President of Apogee's Architectural Metals Segment from August 2019 to October 2023,
and as Senior Vice President, Business Development and Strategy for the Company from May 2018
to August 2019. Prior to joining the Company, Mr. Jewell served in multiple Senior leadership
positions at Valspar, a developer, manufacturer and distributor of paints and coatings, from 2010 to
2017.
Veena Lakkundi
56
President of Apogee’s Performance Surfaces Segment since January 2025. Prior to joining the
Company, Ms. Lakkundi served as Senior Vice President, Strategy and Corporate Development at
Rockwell Automation, a global leader in industrial automation and digital transformation.
Previously, Ms. Lakkundi served at Senior Vice President and Chief Strategy Officer at 3M
Company along with other key leadership positions across 3M.
Name
Age
Positions with Apogee Enterprises and Past Experience
ITEM 1A. RISK FACTORS
Our business faces many risks. Any of the risks discussed below, or elsewhere in this Form 10-K or our other filings with the
Securities and Exchange Commission, could have a material adverse impact on our business, financial condition or operating
results.
Market and Industry Risks
North American and global economic and industry-related business conditions materially adversely affect our sales and results
of operations
Architectural Metals, Architectural Services, Architectural Glass, and a portion of our Performance Surfaces Segment are
influenced by North American economic conditions and the cyclical nature of the North American non-residential construction
industry. The non-residential construction industry is impacted by macroeconomic trends, such as availability of credit,
employment levels, consumer confidence, interest rates and commodity prices. In addition, changes in architectural design
trends, demographic trends, and/or remote work trends could impact demand for our products and services. To the extent
changes in these factors negatively impact the overall non-residential construction industry, our business, operating results and
financial condition could be significantly adversely impacted.
A significant portion of our Performance Surfaces Segment primarily depends on the strength of the U.S. retail custom picture
framing industry. This industry is heavily influenced by consumer confidence and the conditions of the U.S. economy. A
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decline in consumer confidence, whether as a result of an economic slowdown, uncertainty regarding the future or other factors,
could materially and adversely reflect the operating results of the segment.
Global instability and uncertainty arising from events outside of our control, such as significant natural disasters, political
crises, public health crises, and/or other catastrophic events could materially adversely affect our results of operations
Natural disasters, political crises, public health crises, and other catastrophic events or other events outside of our control, may
negatively impact our facilities or the facilities of third parties on which we depend, have broader adverse impacts on the non-
residential construction market, consumer confidence and spending, and/or impact both the well-being of our employees and
our ability to operate our facilities. These types of disruptions or other events outside of our control could affect our business
negatively, cause delays or cancellation of non-residential construction projects or cause us to temporarily close our facilities,
harming our operating results. In addition, if any of our facilities, including our manufacturing, finishing or distribution
facilities, or the facilities of our suppliers, third-party service providers, or customers, is affected by natural disasters, political
crises, public health crises, or other catastrophic events or events outside of our control, our business and operating results could
be materially impacted.
New competitors or specific actions of our existing competitors could materially harm our business
We operate in competitive industries in which the actions of our existing competitors or new competitors could result in loss of
customers and/or market share. Changes in our competitors' products, prices or services could negatively impact our share of
demand and our operating results.
Our customer concentration in the Performance Surfaces Segment creates a significant risk for product sale declines
The Performance Surfaces Segment is highly dependent on a relatively small number of customers for its sales, while working
to grow in new markets and with new customers. Accordingly, loss of a significant customer, or a significant reduction in
pricing for one or more of those customers could materially reduce the segment's operating results.
Strategic Risks
We could be unable to effectively manage and implement our enterprise strategy, which could have a material adverse effect on
our business, financial condition, and results of operations
Our strategy includes differentiating our product and service offerings, shifting our business mix toward higher growth and
operating margin products and services, driving higher return on invested capital performance, and moving to a more
centralized operating model. Execution of this strategy require additional investments of time and resources and could fail to
achieve the desired results. For example, we may be unable to increase our sales and earnings by differentiating our product and
service offerings in a cost-effective manner. We may fail to accurately predict future customer needs and preferences, and thus
focus on the wrong business mix. Our centralized operating system may not produce the desired operating efficiencies.
Risks related to acquisitions, divestitures and restructuring programs could adversely affect our operating results
We continue to look for strategic business opportunities to drive long-term growth and operating efficiencies, which may
include acquisitions, divestitures and/or restructuring plans. We frequently evaluate our brand and product portfolios and may
consider acquisitions that complement our business or divestitures of businesses that we no longer believe to be an appropriate
strategic fit.
As we consider and execute acquisitions, we may incur risks in integrating operations, technologies, products, and employees;
we may fail to realize expected revenue growth and cost synergies from integration initiatives; we would likely increase debt
levels to finance an acquisition; we may not fully anticipate changes in cash flows or other market-based assumptions or
conditions that cause the value of acquired assets to fall below book value, requiring impairment of intangible assets including
goodwill; we may identify contingent liabilities subsequent to closing an acquisition; and we may be entering markets in which
we have no or limited experience.
As we consider and execute future divestitures, we may be exposed to risks associated with our ability to find appropriate
buyers; difficulties in executing transactions on favorable terms; separating divested business operations with minimal impact to
our remaining operations; incur write-offs and impairment charges; and we may have challenges effectively managing any
transition service arrangements.
As we consider and execute restructuring plans, we may be exposed to risks associated with successfully completing the
initiative in a timely manner, or at all; advancing our business strategy as expected; accurately predicting costs; realizing
anticipated cost savings, efficiencies, synergies, financial targets and other benefits; and we may experience the loss of key
employees and/or reduced employee morale and productivity.
Any acquisition, divestiture or restructuring plan, if not favorably executed by management, could have a material adverse
effect on our operating results and/or financial condition.
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Operational Risks
Loss of key personnel and inability to source sufficient labor could adversely affect our operating results
The loss of our CEO or any of our key senior executives could have a material adverse effect on our business, operating results
and financial condition, particularly if we are unable to hire and integrate suitable replacements on a timely basis. Further, as
our business evolves, we may have changes in our senior management team. If we are unable to attract or retain the right
individuals for the team, it could hinder our ability to efficiently execute our business, and could disrupt our operations or
otherwise have a material adverse effect on our business.
Additionally, an important aspect of our success depends on the skills of construction project managers and other key technical
personnel, and our ability to secure sufficient manufacturing and installation labor. In recent years, low U.S. unemployment has
caused increased competition for experienced construction project managers and other labor. If we are unable to retain existing
employees, provide a safe and healthy working environment, and/or recruit and train additional employees with the requisite
skills and experience, our operating results could be adversely impacted.
If we are unable to manage our supply and distribution chains effectively our results of operations will be negatively affected
Our Architectural Metal and Architectural Services Segments use aluminum as a significant input to their products. Our
operating results in those two segments could be negatively impacted by supply chain disruptions and adverse price movements
in the market for raw aluminum. In recent years, we have seen increased volatility in the price of aluminum that we purchase
from both domestic and international sources. Due to our Architectural Metals and Architectural Services Segments presence in
Canada, we have significant cross-border activity, as our Canadian businesses purchase inputs from U.S.-based suppliers and
sell to U.S.-based customers. A significant change in U.S. trade policy with Canada could, therefore, have an adverse impact on
our operating results.
Our Architectural Glass and Performance Surfaces Segments use raw glass as a significant input to their products. Increases in
demand for raw glass may lead to lower supply or higher costs to acquire. Failure to acquire a sufficient supply of raw glass on
terms as favorable as current terms could negatively impact our operating results.
Our suppliers are subject to the fluctuations in general economic cycles. Global economic conditions and trade policies may
impact their ability to operate their businesses. They may also be impacted by the increasing costs or availability of raw
materials, labor and distribution, resulting in demands for less attractive contract terms or an inability for them to meet our
requirements or conduct their own businesses. The performance and financial condition of one or more suppliers may cause us
to alter our business terms or to cease doing business with a particular supplier or suppliers, or change our sourcing practices
generally, which could in turn adversely affect our business and financial condition. If we encounter problems with distribution,
our ability to deliver our products to market could be adversely affected. Our operations are vulnerable to interruptions in the
event of work stoppages, whether due to public health concerns, labor disputes or shortages, and natural disasters that may
affect our distribution and transportation to job sites. Moreover, our distribution system includes computer-controlled and
automated equipment, which may be subject to a number of risks related to data and system security or computer viruses, the
proper operation of software and hardware, power interruptions or other system failures. If we encounter problems with our
distribution systems, our ability to meet customer and consumer expectations, manage inventory, manage transportation-related
costs, complete sales and achieve operating efficiencies could be adversely affected.
Project management and installation issues could adversely affect our operating results
Some of our segments are occasionally awarded fixed-price contracts that do not include escalation clauses on material and
labor costs. These bids are required before all aspects of a construction project are known. An underestimate in the amount of
labor required and/or cost of materials for a project; a change in the timing of the delivery of product; system design errors;
difficulties or errors in execution; or significant project delays, caused by us or other trades, could result in failure to achieve the
expected results. Any one or more of such issues could result in losses on individual contracts that could negatively impact our
operating results.
Difficulties in maintaining our information technology systems, and potential cybersecurity threats, could negatively affect our
operating results and/or our reputation
Our operations are dependent upon various information technology systems that are used to process, transmit and store
electronic information and data, and to manage or support our manufacturing operations and a variety of other business
processes and activities, some of which are managed by third parties. We could encounter difficulties in maintaining our
existing systems, developing and implementing new systems, or integrating information technology systems across our business
units. Such difficulties could lead to disruption in business operations and/or significant additional expenses that could
adversely affect our results.
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Additionally, our information technology and Internet based systems, and those of our third-party service providers, are subject
to disruption and data loss due to natural disasters, power losses, unauthorized access, telecommunication failures and cyber-
attacks of increasing frequency and sophistication. These systems have in the past been, and may in the future be, subject to
cyber-attacks and other attempts to gain unauthorized access, breach, damage, disrupt or otherwise compromise such systems,
none of which have been material to us in the last three fiscal years. The occurrence of any of these events could adversely
affect our reputation and could result in the compromise of confidential information, litigation, manipulation and loss of data
and intellectual property, regulatory action, production downtimes, disruption in availability of financial data, misrepresentation
of information via digital media, and increased costs and operational consequences of implementing further data protection
systems.
Our security measures may also be breached in the future as a result of employee error, failure to implement appropriate
processes and procedures, advances in computer and software capabilities and encryption technology, new tools and
discoveries, malfeasance, third-party action, including cyber-attacks or other international misconduct by computer hackers or
otherwise. Additionally, we may have heightened cybersecurity, information security and operational risks as a result of work-
from-home arrangements. Our workforce operates with a combination of remote work and flexible work schedules opening us
up for cybersecurity threats and potential breaches as a result of increased employee usage of networks other than company-
managed networks. This could result in one or more third-parties obtaining unauthorized access to our customer or supplier data
or our internal data, including personally identifiable information, intellectual property and other confidential business
information. Third-parties may also attempt to fraudulently induce employees into disclosing sensitive information such as user
names, passwords or other information in order to gain access to customer or supplier data or our internal data, including
intellectual property, financial, and other confidential business information.
We believe our mitigation measures reduce, but cannot eliminate, the risk of a cyber incident; however, there can be no
assurance that our existing and planned precautions of backup systems, regular data backups, security protocols and other
procedures will be adequate to prevent significant damage, system failure or data loss and the same is true for our partners,
vendors and other third parties on which we rely. While we maintain cybersecurity insurance, the costs related to cybersecurity
threats or disruptions may not be fully insured. Because techniques used to obtain unauthorized access or sabotage systems
change frequently and generally are not identified until they are launched against a target, we may be unable to anticipate these
techniques or to implement adequate preventative or mitigation measures. Though it is difficult to determine what harm may
directly result from any specific interruption or breach, any failure to maintain performance, reliability, security and availability
of our network infrastructure or otherwise maintain the confidentiality, security, and integrity of data that we store or otherwise
maintain on behalf of third-parties may harm our reputation and our employee and customer relationships. If such unauthorized
disclosure or access does occur, we may be required to notify our customers, employees or those persons whose information
was improperly used, disclosed or accessed. We may also be subject to claims of breach of contract for such use or disclosure,
investigation and penalties by regulatory authorities and potential claims by persons whose information was improperly used or
disclosed. We could also become the subject of regulatory action or litigation from our customers, employees, suppliers, service
providers, and shareholders, which could damage our reputation, require significant expenditures of capital and other resources,
and cause us to lose business. Additionally, an unauthorized disclosure or use of information could cause interruptions in our
operations and might require us to spend significant management time and other resources investigating the event and dealing
with local and federal law enforcement. Regardless of the merits and ultimate outcome of these matters, we may be required to
devote time and expense to their resolution.
In addition, the number of data security incidents has increased regulatory and industry focus on security requirements and
heightened data security industry practices. New regulation, evolving industry standards, and the interpretation of both, may
cause us to incur additional expense in complying with any new data security requirements. As a result, the failure to maintain
the integrity of and protect customer or supplier data or our confidential internal data could have a material adverse effect on
our business, operating results and financial condition.
Legislative, Regulatory and Tax Risks
Changes in trade policies may result in increased costs and could adversely affect our operating results
The impact of geopolitical tensions, including the potential implementation of more restrictive trade policies, higher tariffs or
the renegotiation of existing trade agreements in the U.S. or countries where we sell our products and services or procure
products, could have a material adverse effect on our business. In particular, political or trade disputes, or future phases of trade
negotiations with Canada that could lead to the imposition of tariffs or other trade actions could require us to take action to
mitigate those effects. We may be unable to pass through additional tariff costs to our customers through price increases, and
may be unable to secure adequate alternative sources of supply. Our inability to offset higher tariff costs could have a material
adverse effect on our operating results, profitability, customer relationships and future cash flow.
Violations of legal and regulatory compliance requirements, including environmental laws, and changes in existing legal and
regulatory requirements, may have a negative impact on our business and results of operations
We are subject to a legal and regulatory framework imposed under federal and state laws and regulatory agencies, including
14
laws and regulations that apply specifically to U.S. public companies and laws and regulations applicable to our manufacturing
and construction site operations. Our efforts to comply with evolving laws, regulations, and reporting standards, including
climate-related regulations, may increase our general and administrative expenses, divert management time and attention, or
limit our operational flexibility, all of which could have a material adverse effect on our business, financial position, and results
of operations. Additionally, new laws, rules, and regulations, or changes to existing laws or their interpretations, could create
added legal and compliance costs and uncertainty for us.
We use hazardous materials in our manufacturing operations, and have air and water emissions that require controls.
Accordingly, we are also subject to federal, state, local and foreign environmental laws and regulations, including those
governing the storage and use of hazardous materials and disposal of wastes. A violation of such laws and regulations, or a
release of such substances, may expose us to various claims, including claims by third parties, as well as remediation costs and
fines.
Product quality issues and product liability claims could adversely affect our operating results
We manufacture and/or install a significant portion of our products based on the specific requirements of each customer. We
believe that future orders of our products or services will depend on our ability to maintain the performance, reliability, quality
and timely delivery standards required by our customers. We have in the past, and are currently, subject to product liability and
warranty claims, including certain legal claims related to a commercial sealant product formerly incorporated into our products,
and there is no certainty we will prevail on these claims. If our products have performance, reliability or quality problems, or
products are installed using incompatible glazing materials or installed improperly (by us or a customer), we may experience
additional warranty and other expenses; reduced or canceled orders; higher manufacturing or installation costs; or delays in the
collection of accounts receivable. Additionally, product liability and warranty claims, including relating to the performance,
reliability or quality of our products and services, could result in costly and time-consuming litigation that could require
significant time and attention of management and involve significant monetary damages that could negatively impact our
operating results. There is also no assurance that the number and value of product liability and warranty claims will not increase
as compared to historical claim rates, or that our warranty reserve at any particular time is sufficient. No assurance can be given
that coverage under insurance policies, if applicable, will be adequate to cover future product liability claims against us. If we
are unable to recover on insurance claims, in whole or in part, or if we exhaust our available insurance coverage at some point
in the future, then we might be forced to expend our own funds on legal fees and settlement or judgment costs, which could
negatively impact our profitability, results of operations, cash flows and financial condition.
Our judgments regarding the accounting for tax positions and the resolution of tax disputes, as well as any changes in tax
legislation may impact our net earnings and cash flow
Significant judgment is required to determine our effective tax rate and evaluate our tax positions. We provide for uncertain tax
positions when such tax positions do not meet the recognition thresholds or measurement criteria prescribed by applicable
accounting standards. Fluctuations in federal, state, local and foreign taxes or a change to uncertain tax positions, including
related interest and penalties, may impact our effective tax rate and financial results. Additionally, we are subject to audits in
the various taxing jurisdictions in which we conduct business. In cases where audits are conducted and issues are raised, a
number of years may elapse before such issues are finally resolved. Unfavorable resolution of any tax matter could increase the
effective tax rate, which could have an adverse effect on our operating results and cash flow. The impact of future tax
legislation in the U.S. or abroad is always uncertain. Changes in such laws could adversely impact our effective income tax rate.
Financial Risks
Results can differ significantly from our expectations and the expectations of analysts, which could have an adverse effect on
the market price of our common stock
From time to time, we may provide financial projections to our shareholders, lenders, investment community, and other
stakeholders. Our projections are based on management’s best estimate utilizing prevailing business and economic conditions
as well as other relevant information available at the time. These projections are highly subjective and are based upon a variety
of factors that could change materially over time. As a result, our future actual results could vary materially from our
projections which could have an adverse impact on the market price of our common stock.
Changes in macroeconomic factors may negatively impact our profitability
Rising interest rates, inflation, and higher input costs, could reduce the demand for our products and services and impact our
profitability. Higher interest rates make it more expensive for our customers to finance construction projects, and as a result,
may reduce the number of projects available to us and the demand for our products and services, and also increase the interest
expenses associated with our borrowings. Cost inflation, including significant cost increases for freight, aluminum, glass, paint,
wood-based and other materials used in our operations, has impacted, and could continue to impact, our profitability.
Furthermore, in some of our segments, we operate on contracts wherein we bear part or all of the risk of inflation on materials
costs and the cost of installation services. Our ability to mitigate these costs, or recover the cost increases through price
increases, may lag the cost increases, which could negatively impact our margins.
15
We may experience further impairment of our goodwill, indefinite- and definite-lived intangible assets and long-lived assets, in
the future, which could adversely impact our financial condition and results of operations
Our assets include a significant amount of goodwill, indefinite- and definite-lived intangible assets and long-lived assets. We
evaluate goodwill and indefinite-lived intangible assets for impairment annually in our fiscal fourth quarter, or more frequently
if events or changes in circumstances indicate that the carrying value of a reporting unit may not be recoverable. We evaluate
definite-lived intangible assets and long-lived assets for impairment if events or changes in circumstances indicate that the
carrying value of the long-lived asset may not be recoverable. The assessment of impairment involves significant judgment and
projections about future performance.
Based on our annual impairment valuation analysis performed in the fourth quarter of fiscal 2025, we incurred $7.6 million of
pre-tax impairment charges related to indefinite-lived intangibles in the Architectural Metals Segment as a result of strategic
branding changes. Additionally, as a result of a publicly announced restructuring plan in the fourth quarter of fiscal 2024, we
incurred $6.2 million of pre-tax impairment charges related to property, plant and equipment and operating lease right-of-use
assets.
The discounted cash flow projections and revenue projections used in our annual impairment valuation analysis are dependent
upon achieving forecasted levels of revenue and profitability. If revenue or profitability were to fall below forecasted levels, or
if market conditions were to decline in a material or sustained manner, impairment could be indicated and we could incur a non-
cash impairment expense that would negatively impact our financial condition and results of operations.
Failure to maintain effective internal controls over financial reporting could adversely impact our ability to timely and
accurately report financial results and comply with our reporting obligations, which could materially affect our business
Regardless of how internal financial reporting control systems are designed, implemented, and enforced, they cannot ensure
with absolute certainty that our internal control objectives will be met in every instance. Because of the inherent limitations of
all such systems, our internal controls over financial reporting may not always prevent or detect misstatements. Failure to
maintain effective internal control over financial reporting could adversely affect our ability to accurately and timely report
financial results, to prevent or detect fraud, or to comply with the requirements of the SEC or the Sarbanes-Oxley Act of 2002,
which could necessitate a restatement of our financial statements, and/or result in an investigation, or the imposition of
sanctions, by regulators. Such failure could additionally expose us to litigation and/or reputational harm, impair our ability to
obtain financing, or increase the cost of any financing we obtain. All of these impacts could adversely affect the price of our
common stock and our business overall.
Our liquidity or cost of capital may be materially adversely affected by constraints or changes in the capital and credit markets,
interest rates and limitations under our financing arrangements
We need sufficient sources of liquidity to fund our working capital requirements, service our outstanding indebtedness and
finance business opportunities. Without sufficient liquidity, we could be forced to curtail our operations, or we may not be able
to pursue business opportunities. The principal sources of our liquidity are funds generated from operating activities, available
cash, credit facilities, and other debt arrangements. If our sources of liquidity do not satisfy our requirements, we may need to
seek additional financing. The future availability of financing will depend on a variety of factors, such as economic and market
conditions, the regulatory environment for banks and other financial institutions, the availability of credit and our reputation
with potential lenders. These factors could materially adversely affect our liquidity, costs of borrowing and our ability to pursue
business opportunities or grow our business. We may also assume or incur additional debt, including secured debt, in the future
in connection with, or to fund, future acquisitions or for other operating needs.
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
ITEM 1C. CYBERSECURITY
Risk Management and Strategy
We recognize the critical importance of maintaining the confidentiality, integrity and availability of our information systems
and data, and of effectively assessing, identifying and managing cybersecurity and related risks. Our cybersecurity risk
management program is integrated into our Enterprise Risk Management framework and utilizes a holistic approach to
addressing cybersecurity risk. It is supported by our employees, cybersecurity team, senior management, the Enterprise Risk
Management committee, and our Board of Directors (Board). The underlying controls for the cybersecurity risk management
program are based on recognized best practices and standards for cybersecurity and information technology, including the
National Institute of Standards and Technology and the Center for Internet Security Benchmark.
Our cybersecurity risk management program includes an incident response plan for evaluation, response and reporting of
cybersecurity incidents, including notification of the Board and third parties, as appropriate. Under the plan, a Cybersecurity
16
Intake Team, which is comprised of the Chief Information Officer (CIO), Senior Director of Information Security (SDIS) and
other executive management, is responsible for a materiality assessment of cybersecurity incidents, taking into consideration
both quantitative and qualitative factors, and subject to ongoing monitoring and escalation based on materiality.
Third party vendors and suppliers also play a role in our cybersecurity risk management program. In circumstances where such
third parties will access our systems and data, our SDIS participates in the vendor management process, including the review of
contractual requirements and contractually imposing obligations on the vendor to report cybersecurity incidents to us so that we
can assess the impact.
In addition to the incident response plan and vendor management process, our cybersecurity risk management program
includes:
•
an information technology and cybersecurity training program, and ongoing employee testing to evaluate the
effectiveness of quarterly internal training and awareness communications;
•
external advisors to assist with cybersecurity risk assessment, including third-party monitoring of the Company's
systems, external network penetration testing, and yearly cyber event preparedness exercises;
•
development of strategies to mitigate cyber risks; and,
•
crisis management, business continuity, and disaster recovery plans.
We have not encountered cybersecurity incidents or identified risks from cybersecurity threats that have had a material adverse
effect or are reasonably likely to have a material effect on our business strategy, operations or financial condition.
Notwithstanding the efforts we take to manage our cybersecurity risk, we may not be successful in preventing or mitigating a
cybersecurity incident that could have a material adverse effect on us. While the Company maintains cybersecurity insurance,
the costs related to cybersecurity threats or disruptions may not be fully insured. See Item 1A. “Risk Factors” for a discussion
of cybersecurity risks.
17
Governance
Management's Role in Managing Risk
Within our organization, our CIO, who reports to our CEO, oversees cybersecurity. Our SDIS reports to our CIO and is
generally responsible for management of cybersecurity risk and the protection and defense of our network and systems,
including the development and management of policies and processes to identify, contain, and investigate potential incidents
and ensure recovery therefrom. Our SDIS has over 15 years of experience managing information technology and cybersecurity
matters in multiple industries. The SDIS maintains Certified Information Systems Security Professional and Certified
Information Security Manager certifications and holds a degree in information technology management.
Board's Role in Oversight
Our Board oversees our cybersecurity risk management program, and includes cybersecurity as part of the assessment of the
Company's overall Enterprise Risk Management program. At least twice per year, and more frequently, if necessary, our CIO
updates our Board on the Company's cyber risk profile and the steps taken by management to mitigate those risks. In the event
of a material cybersecurity incident, the Board would receive prompt and timely information regarding the incident, as well as
ongoing updates regarding such incident until it has been addressed. Cybersecurity-related risks are included in the Enterprise
Risk Management committee’s evaluation of top risks to the enterprise, which are also presented to the Board and executive
management twice per year.
ITEM 2. PROPERTIES
The following table lists, by segment, the Company's principal physical properties as of March 1, 2025. We believe these
properties are generally in good operating condition, suitable for their respective uses and adequate for our current needs as our
business is presently conducted.
Architectural Metals Segment
Wausau, WI
Owned
Manufacturing/Administrative
Reed City, MI
Owned
Manufacturing
Mesquite, TX
Leased
Manufacturing
Monett, MO
Owned
Manufacturing/Warehouse/Administrative
Toronto, ON Canada
Leased
Manufacturing/Warehouse/Administrative
Architectural Services Segment
Minneapolis, MN
Leased
Administrative
West Chester, OH
Leased
Manufacturing
Mesquite, TX
Leased
Manufacturing
Brampton, ON Canada
Leased
Manufacturing/Warehouse/Administrative
Architectural Glass Segment
Owatonna, MN
Owned
Manufacturing/Administrative
Performance Surfaces Segment
McCook, IL
Leased
Manufacturing/Warehouse/Administrative
Faribault, MN
Owned
Manufacturing/Administrative
Louisville, KY
Leased
Manufacturing/Administrative
Other
Minneapolis, MN
Leased
Administrative
Property Location
Owned/ Leased
Function
18
ITEM 3. LEGAL PROCEEDINGS
The Company is a party to various legal proceedings incidental to its normal operating activities. In particular, like others in the
construction supply and services industry, the Company is routinely involved in various disputes and claims arising out of
construction projects, sometimes involving significant monetary damages or product replacement. We have in the past and are
currently subject to product liability and warranty claims, including certain legal claims related to a commercial sealant product
formerly incorporated into our products.
In December 2022, the claimant in an arbitration of one such claim was awarded $20 million by an arbitration panel. The
claimant then sought to confirm this award in Los Angeles Superior Court in March 2023. In response, the Company moved to
vacate the award. Later in March 2023, the Superior Court confirmed the award, which the Company appealed in June 2023.
The appeal was argued before the California Court of Appeals, Second Appellate District, Division Seven, on March 7, 2025.
The California Court of Appeals confirmed the judgment of the Superior Court on March 25, 2025. The Company paid the final
arbitration award, including accrued post-judgment interest, in the amount of $24.7 million, on April 7, 2025. As a result of the
judgment by the Superior Court, the Company recorded expense of $9.4 million, which represents the impact of the award
amount net of existing reserves and estimated insurance proceeds. This impact was recorded in cost of goods sold in the fourth
quarter of fiscal 2025.
The Company is also subject to litigation arising out of areas such as employment practices, workers compensation and general
liability matters. Although it is very difficult to accurately predict the outcome of any such proceedings, facts currently
available indicate that no matters will result in losses that would have a material adverse effect on the results of operations, cash
flows or financial condition of the Company.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
19
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND
ISSUER PURCHASES OF EQUITY SECURITIES
Market Information
Our common stock is traded on The Nasdaq Stock Market under the ticker symbol "APOG". As of April 4, 2025, there were
1,032 shareholders of record and 22,627 shareholders for whom securities firms acted as nominees.
Dividends
Quarterly, the Board of Directors evaluates declaring dividends based on operating results, available funds and the Company's
financial condition. Cash dividends have been paid each quarter since 1974. The chart below shows quarterly and annual
cumulative cash dividends per share for the past two fiscal years.
Fiscal Year
First
Second
Third
Fourth
Total
2025
$
0.2500 $
0.2500 $
0.2500 $
0.2600 $
1.0100
2024
0.2400
0.2400
0.2400
0.2500
0.9700
Purchases of Equity Securities by the Company
The following table provides information with respect to purchases made by the Company of its own stock during the fourth
quarter of fiscal 2025:
Period
Total Number of
Shares Purchased
(a)
Average Price
Paid per Share
Total Number of
Shares Purchased
as Part of
Publicly
Announced Plans
or Programs (b)
Maximum
Number of
Shares that May
Yet Be Purchased
under the Plans
or Programs (b)
December 1, 2024 through December 28, 2024
260 $
71.73
—
2,731,910
December 29, 2024 through January 25, 2025
545,181
55.04
545,117
2,186,793
January 26, 2025 through March 1, 2025
2,896
52.98
—
2,186,793
Total
548,337 $
58.70
545,117
2,186,793
(a) The shares in this column represent the total number of shares that were surrendered by plan participants to satisfy withholding tax
obligations related to share-based compensation and the total number of shares that were repurchased pursuant to our publicly announced
repurchase program.
(b) In fiscal 2004, announced on April 10, 2003, the Board of Directors authorized the repurchase of 1,500,000 shares of Company stock.
The Board increased the authorization by 750,000 shares, announced on January 24, 2008; by 1,000,000 shares on each of the
announcement dates of October 8, 2008, January 13, 2016, January 9, 2018, January 14, 2020, October 7, 2021 and June 22, 2022; and by
2,000,000 shares, announced on October 3, 2018, January 14, 2022 and October 6, 2023. The repurchase program does not have an
expiration date.
20
Comparative Stock Performance
The graph below compares the cumulative total shareholder return on a $100 investment in our common stock for the last five
fiscal years with the cumulative total return on a $100 investment in the Russell 2000 Index, a broad equity market index, and
the S&P 600 Industrials Index. Effective as of February 26, 2023, the Company changed industry indexes, from the S&P Small
Cap 600 Growth Index to the S&P 600 Industrials Index. We believe that the S&P 600 Industrials Index is the best available
published industry index, composed of companies with similar market capitalization and a mix of GICS classifications that
reasonably reflect our diverse business activities, although most of our direct competitors in our various business units are
either privately owned or are divisions of larger, publicly owned companies. The graph assumes an investment at the close of
trading on February 29, 2020, and also assumes the reinvestment of all dividends.
Fiscal Year
Index Value
Comparative Stock Performance
Five-Year Cumulative Total Return
February 29, 2020 to March 1, 2025
Apogee
S&P 600 Industrials
Russell 2000
S&P SmallCap 600 Growth Index
2020
2021
2022
2023
2024
2025
40
60
80
100
120
140
160
180
200
220
2020
2021
2022
2023
2024
2025
Apogee
$
100.00 $
127.65 $
158.44 $
162.99 $
207.19 $
176.84
S&P 600 Industrials
100.00
143.70
146.23
158.76
195.04
210.66
Russell 2000 Index
100.00
151.00
141.49
135.97
150.14
160.18
S&P SmallCap 600 Growth Index
100.00
146.85
144.50
133.20
147.87
153.24
ITEM 6. [RESERVED]
21
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
The following Management’s Discussion and Analysis of Financial Condition and Results of Operations is intended to assist
the reader in understanding our financial condition and results of operations, including an evaluation of the amounts and
certainty of cash flows from operations and from outside sources, and is provided as a supplement to and should be read in
conjunction with the consolidated financial statements and related notes in Item 8. Financial Statements and Supplementary
Data in this Form 10-K. Refer to Item 7, Management’s Discussion and Analysis of Financial Condition and Results of
Operations, in our Form 10-K for the fiscal year ended March 2, 2024, for discussion of the results of operations for the year
ended March 2, 2024, compared to the year ended February 25, 2023, which is incorporated by reference herein.
We have included in this report measures of financial performance that are not defined by GAAP. We believe that these
measures provide useful information and include these measures in other communications to investors. For each of these non-
GAAP financial measures, we provide a reconciliation of the differences between the non-GAAP measure and the most directly
comparable GAAP measure, (see "Reconciliation of Non-GAAP Financial Measures" in this Item 7 below), and an explanation
of why we believe the non-GAAP measure provides useful information to management and investors. These non-GAAP
measures should be viewed in addition to, and not in lieu of, the comparable GAAP measure. Adjusted net earnings and
adjusted earnings per diluted share (adjusted diluted EPS) are supplemental non-GAAP financial measures provided by the
Company to assess performance on a more comparable basis from period-to-period by excluding amounts that management
does not consider part of core operating results. Management uses these non-GAAP measures to evaluate the Company’s
historical and prospective financial performance, measure operational profitability on a consistent basis, as a factor in
determining executive compensation, and to provide enhanced transparency to the investment community.
Overview
We are a leading provider of architectural products and services for enclosing buildings, and high-performance coating products
used in applications for preservation, protection and enhanced viewing.
During the fourth quarter of fiscal 2025, we changed the names of two reportable segments to better reflect our product
offerings and capabilities. The previously named Architectural Framing Systems Segment is now referred to as the
Architectural Metals Segment. The previously named Large-Scale Optical Segment is now referred to as the Performance
Surfaces Segment. The remaining two segments, Architectural Services Segment and Architectural Glass Segment remain
unchanged. As part of these changes, there were no changes to the products or brands included within each of the reportable
segments.
In the fourth quarter of fiscal 2024, the Company announced strategic actions to streamline its business operations, enable a
more efficient cost model, and better position the Company for profitable growth (referred to as “Project Fortify”). During the
fourth quarter of fiscal 2024, the Company incurred $12.4 million of pre-tax charges related to Project Fortify, of which
$5.5 million is included in cost of sales and $6.9 million is included in selling, general, and administrative (SG&A) expenses.
During fiscal 2025, the Company incurred $4.3 million of pre-tax charges related to Project Fortify, of which $2.5 million is
included in cost of sales and $1.8 million is included in SG&A expenses. The Company completed Project Fortify during the
fourth quarter of fiscal 2025, incurring a total of $16.7 million and delivering estimated annualized cost savings of
approximately $14 million.
On April 23, 2025, we announced an extension of Project Fortify ("Project Fortify Phase 2" or "Phase 2") to drive further cost
efficiencies, primarily in the Architectural Metals and Architectural Services Segments. Phase 2 will focus on further
optimizing our operating footprint and aligning resources to enable a more effective operating model. We expect the actions of
Phase 2 to incur approximately $24 million to $26 million of pre-tax charges of which approximately $8 million are expected to
be non-cash charges. Phase 2 is expected to deliver annualized pre-tax cost savings of approximately $13 million to $15
million. We expect the actions associated with Phase 2 to be substantially completed by the end of the fourth quarter of fiscal
2026. See Note 18 for additional information.
During the third quarter of fiscal 2025, we acquired UW Solutions for $240.9 million. UW Solutions is a U.S. based, vertically
integrated manufacturer of high-performance coated substrates, differentiated by its proprietary formulations and coating
application processes. The business serves a broad range of customers in attractive end markets, including building products for
distribution centers and manufacturing facilities, as well as premium products for the graphic arts market. See Note 17 for
additional information.
As a result of a March 2025 appellate court decision confirming a December 2022 arbitration award, the Company paid the
arbitration award, including accrued post-judgment interest, in the amount of $24.7 million, on April 7, 2025. As a result of the
decision, we recorded expense of $9.4 million, which represents the impact of the award amount net of existing reserves and
estimated insurance proceeds. This impact was recorded in cost of goods sold in the fourth quarter of fiscal 2025.
22
Results of Operations
The following tables provide various components of our operations for fiscal years 2025, 2024 and 2023, in U.S. dollar
amounts and percentages reflecting annual changes in such amounts and as a percentage of net sales in each fiscal year.
Our fiscal year ends on the Saturday closest to the last day of February. Fiscal 2025 and fiscal 2023 each consisted of 52 weeks,
while fiscal 2024 consisted of 53 weeks.
% Change
(Dollars in thousands)
2025
2024
2023
2025 vs.
2024
2024 vs.
2023
Net sales
$ 1,360,994 $ 1,416,942 $ 1,440,696
(3.9) %
(1.6) %
Cost of sales
1,001,101 1,049,814 1,105,423
(4.6) %
(5.0) %
Gross profit
359,893
367,128
335,273
(2.0) %
9.5 %
Selling, general and administrative expenses
241,783
233,295
209,485
3.6 %
11.4 %
Operating income
118,110
133,833
125,788
(11.7) %
6.4 %
Interest expense, net
6,159
6,669
7,660
(7.6) %
(12.9) %
Other (income) expense, net
(623)
(2,089)
1,507
N/M
N/M
Earnings before income taxes
112,574
129,253
116,621
(12.9) %
10.8 %
Income tax expense
27,522
29,640
12,514
(7.1) %
136.9 %
Net earnings
$
85,052 $
99,613 $ 104,107
(14.6) %
(4.3) %
Diluted earnings per share
$
3.89 $
4.51 $
4.64
(13.7) %
(2.8) %
N/M - Indicates calculation is not meaningful
(Percentage of net sales)
2025
2024
2023
Net sales
100.0 %
100.0 %
100.0 %
Cost of sales
73.6
74.1
76.7
Gross profit
26.4
25.9
23.3
Selling, general and administrative expenses
17.8
16.5
14.5
Operating income
8.7
9.4
8.7
Interest expense, net
0.5
0.5
0.5
Other (income) expense, net
—
(0.1)
0.1
Earnings before income taxes
8.3
9.1
8.1
Income tax expense
2.0
2.1
0.9
Net earnings
6.2 %
7.0 %
7.2 %
Effective income tax rate
24.4 %
22.9 %
10.7 %
The following table summarizes the impact that different items had on our net sales for fiscal 2025. All net sales for fiscal 2024
were organic.
(In thousands, except percentages)
Architectural
Metals
Architectural
Services
Architectural
Glass
Performance
Surfaces
Intersegment
eliminations
Consolidated
Fiscal 2024 net sales
$
601,736
$
378,422
$
378,449
$
99,223
$
(40,888)
$ 1,416,942
Organic business (1)
(66,113)
50,332
(49,124)
(6,835)
12,512
(59,228)
Impact of 53rd week (2)
(10,914)
(8,893)
(7,128)
(2,241)
472
(28,704)
Acquisition (3)
—
—
—
31,984
—
31,984
Fiscal 2025 net sales
$
524,709
$
419,861
$
322,197
$
122,131
$
(27,904)
$ 1,360,994
Total net sales growth (decline)
(12.8) %
11.0 %
(14.9) %
23.1 %
(31.8) %
(3.9) %
Organic business (1)
(11.0) %
13.3 %
(13.0) %
(6.9) %
(30.6) %
(4.2) %
Impact of 53rd week (2)
(1.8) %
(2.4) %
(1.9) %
(2.3) %
(1.2) %
(2.0) %
Acquisition (3)
— %
— %
— %
32.2 %
— %
2.3 %
23
(1)
Organic business includes net sales associated with acquired product lines or businesses that occur after the first twelve months from the date the
product line or business is acquired and net sales from internally developed product lines or businesses.
(2)
Amount is estimated based on average weekly net sales of the final month of the period.
(3)
On November 4, 2024, we completed the acquisition of UW Solutions. For additional information see Note 17 to the accompanying consolidated
financial statements.
Comparison of Fiscal 2025 to Fiscal 2024
•
Consolidated net sales were $1.36 billion compared to $1.42 billion, a decrease of 3.9%, primarily reflecting the
unfavorable impact of the additional week in the prior year of approximately $28.7 million or 2.0%, and lower volume,
primarily in Architectural Metals and Architectural Glass. These items were partially offset by net sales growth in
Architectural Services, and a $32.0 million inorganic sales contribution from the acquisition of UW Solutions.
•
Gross margin increased to 26.4% of net sales, compared to 25.9%. The gross margin improvement was primarily
driven by a more favorable mix of projects and the net favorable impact of cumulative catch-up adjustments for
changes in profitability estimates of long-term contracts in Architectural Services, and lower quality and insurance-
related costs, as well as lower restructuring costs from Project Fortify. These items were partially offset by $9.4
million of expense related to an arbitration award, as well as unfavorable sales leverage impact of lower volume,
higher lease costs, and $1.7 million of acquisition-related expenses.
•
SG&A expense increased $8.5 million to 17.8% of net sales, compared to 16.5% of net sales. The increase in SG&A
as a percentage of net sales was primarily due to the impact of $8.6 million of acquisition-related expenses,
impairment charges of $7.6 million, higher amortization expense and the unfavorable sales leverage impact of lower
volume partially offset by lower restructuring charges, lower bad debt expense, and lower long-term incentive costs.
•
Operating income was $118.1 million and operating margin declined to 8.7%. The decline operating margin was
primarily due to the unfavorable sales leverage impact of lower volume, $10.3 million of acquisition-related expenses,
$9.4 million of expense related to an arbitration award, and $7.6 million impairment charges related to strategic
rebranding. These items were partially offset by a more favorable mix of projects and the net favorable impact of
cumulative catch-up adjustments for changes in profitability estimates of long-term contracts in Architectural Services,
lower quality and insurance-related costs, lower bad debt expense, and lower restructuring charges from Project Fortify
of $8.1 million. Adjusted operating income grew 2.4% to $149.8 million, and adjusted operating margin improved to
11.0%.
•
Interest expense, net was $6.2 million, compared to $6.7 million, primarily driven by increased interest income from
higher average levels of invested cash, partially offset by the impact of the write-off of unamortized financing fees of
$0.5 million related to our previous credit facility.
•
Other income was $0.6 million, compared to $2.1 million. The lower income in fiscal 2025 was primarily due pre-tax
gain related to a New Markets Tax Credit of $4.7 million, partially offset by the unfavorable impact of an investment
market valuation adjustment, both recognized in the prior year period.
•
Income tax expense as a percentage of earnings before income tax was 24.4%, compared to 22.9% for fiscal 2024. The
increase in the effective tax rate was primarily due to an increase in tax expense for discrete items.
•
Diluted EPS was $3.89, compared to $4.51 driven by lower operating income, lower other income, and a higher
effective tax rate. Adjusted diluted EPS grew 4.2% to $4.97.
24
Segment Analysis
% Change
(Dollars in thousands)
2025
2024
2023
2025 vs.
2024
2024 vs.
2023
Segment net sales
Architectural Metals
$ 524,709
$ 601,736
$ 649,778
(12.8) %
(7.4) %
Architectural Services
419,861
378,422
410,627
11.0 %
(7.8) %
Architectural Glass
322,197
378,449
316,554
(14.9) %
19.6 %
Performance Surfaces
122,131
99,223
104,215
23.1 %
(4.8) %
Intersegment eliminations
(27,904)
(40,888)
(40,478)
(31.8) %
1.0 %
Net sales
$ 1,360,994
$ 1,416,942
$ 1,440,696
(3.9) %
(1.6) %
Segment operating income (loss)
Architectural Metals
$
42,466
$
64,833
$
81,875
(34.5) %
(20.8) %
Architectural Services
30,046
11,840
18,140
153.8 %
(34.7) %
Architectural Glass
59,274
68,046
28,610
(12.9) %
137.8 %
Performance Surfaces
19,611
24,233
25,348
(19.1) %
(4.4) %
Corporate and Other
(33,287)
(35,119)
(28,185)
(5.2) %
24.6 %
Operating income
$ 118,110
$ 133,833
$ 125,788
(11.7) %
6.4 %
Segment operating margin
Architectural Metals
8.1 %
10.8 %
12.6 %
Architectural Services
7.2 %
3.1 %
4.4 %
Architectural Glass
18.4 %
18.0 %
9.0 %
Performance Surfaces
16.1 %
24.4 %
24.3 %
Corporate and other
N/M
N/M
N/M
Operating margin
8.7 %
9.4 %
8.7 %
Segment net sales is defined as net sales for a certain segment and includes revenue related to intersegment transactions. We
report net sales intersegment eliminations separately to exclude these sales from our consolidated total. Segment operating
income is equal to net sales, less cost of goods sold, and SG&A. Segment operating income includes operating income related
to intersegment sales transactions and excludes certain corporate costs that are not allocated at a segment level. We report these
unallocated corporate costs separately in Corporate and other. Operating income does not include other income or expense,
interest expense or a provision for income taxes.
25
Architectural Metals
Comparison of Fiscal 2025 to Fiscal 2024
•
Net sales were $524.7 million, compared to $601.7 million. The decline in net sales was primarily driven by reduced
volume due to exiting certain lower-margin product lines as part of Project Fortify and lower end market demand, the
impact of one less week of net sales in the current year, and a less favorable product mix.
•
Operating income was $42.5 million, or 8.1% of net sales, compared to $64.8 million, or 10.8% of net sales. The
decline in operating margin was primarily driven by $7.6 million of impairment charges, the unfavorable sales
leverage impact of lower volume and a less favorable product mix, partially offset by favorable material costs, lower
short-term incentive costs, lower bad debt expense, lower quality-related expense, and lower restructuring costs.
Adjusted operating income was $54.1 million, or 10.3% of net sales, compared to $70.8 million, or 11.8% of net sales.
Architectural Services
Comparison of Fiscal 2025 to Fiscal 2024
•
Net sales were $419.9 million, compared to $378.4 million. The increase in net sales was primarily due to increased
volume, a more favorable mix of projects and the net favorable impact of cumulative catch-up adjustments for changes
in profitability estimates of long-term contracts, partially offset by the impact of one less week of net sales in the
current year.
•
Operating income was $30.0 million, or 7.2% of net sales, compared to $11.8 million or 3.1% of net sales. The
improvement in operating margin was primarily driven by a more favorable mix of projects, the favorable impact of
cumulative catch-up adjustments on our longer-term contract estimates of $10.5 million, and lower restructuring
charges, partially offset by higher short-term incentive compensation expense and higher lease costs.
•
For the years ended March 1, 2025 and March 2, 2024, gross favorable and unfavorable cumulative catch-up
adjustments on our longer-term contracts for changes in estimates were as follows:
(in thousands)
2025
2024
Gross favorable adjustments
$
28,430 $
19,058
Gross unfavorable adjustments
(12,123)
(13,298)
Net adjustments
$
16,307 $
5,760
Architectural Glass
Comparison of Fiscal 2025 to Fiscal 2024
•
Net sales were $322.2 million, compared to $378.4 million. The decrease in net sales was primarily driven by lower
volume due to lower end-market demand and the impact of one less week of net sales in the current year, partially
offset by improved pricing.
•
Operating income decreased to $59.3 million, or 18.4% of net sales, compared to $68.0 million, or 18.0% of net sales.
The improvement in operating margin was primarily driven by improved pricing, improved productivity, and lower
quality-related costs, partially offset by the unfavorable sales leverage impact of lower volume.
Performance Surfaces
Comparison of Fiscal 2025 to Fiscal 2024
•
Net sales were $122.1 million, compared to $99.2 million. The increase in net sales was primarily driven by $32.0
million of inorganic sales from UW Solutions, partially offset by lower volume in the retail channel and the impact of
one less week of net sales in the current year.
•
Operating income was $19.6 million, or 16.1% of net sales, compared to $24.2 million, or 24.4% of net sales. The
decline in operating margin was primarily driven by $4.5 million in acquisition-related costs and the sales leverage
impact of lower organic volume.
Corporate and Other
Comparison of Fiscal 2025 to Fiscal 2024
26
•
Corporate and Other expense was $33.3 million, compared to $35.1 million. The decrease was primarily due to lower
insurance-related costs, lower incentive compensation expense, and lower restructuring costs, partially offset by $9.4
million of expense related to an arbitration award, and $5.8 million in acquisition-related costs.
Backlog
Backlog is an operating measure used by management to assess future potential sales revenue. Backlog is defined as the dollar
amount of signed contracts or firm orders, generally as a result of a competitive bidding process, which is expected to be
recognized as revenue. Backlog is not a term defined under U.S. GAAP and is not a measure of contract profitability. Backlog
should not be used as the sole indicator of future revenue because we have a substantial number of projects with short lead
times that book-and-bill within the same reporting period that are not included in backlog.
Architectural Services
As of fiscal 2025 year-end, backlog in the Architectural Services Segment was $720.3 million, compared to $807.8 million at
the end of the prior year.
Reconciliations of Non-GAAP Financial Measures
Adjusted operating income, adjusted operating margin, adjusted net earnings, adjusted diluted earnings per share (adjusted
diluted EPS), adjusted earnings before interest, taxes, depreciation and amortization (adjusted EBITDA), adjusted EBITDA
margin, and adjusted return on invested capital (ROIC) are supplemental non-GAAP financial measures provided by the
Company to assess performance on a more comparable basis from period-to-period by excluding amounts that management
does not consider part of core operating results. Management uses these non-GAAP measures as noted below:
•
We use adjusted operating income, adjusted operating margin, adjusted net earnings, and adjusted diluted EPS to
provide meaningful supplemental information about our operating performance by excluding amounts that are not
considered part of core operating results to enhance comparability of results from period to period.
•
Adjusted EBITDA and adjusted EBITDA margin metrics provide useful information to investors and analysts about
our core operating performance.
•
Adjusted return on invested capital (ROIC) is defined as adjusted operating income net of tax, divided by average
invested capital. We believe this measure is useful in understanding operational performance and capital allocation
over time, and it is used as a factor in determining executive compensation.
These non-GAAP measures should be viewed in addition to, and not as an alternative to, the reported financial results of the
Company prepared in accordance with GAAP. Other companies may calculate these measures differently, thereby limiting the
usefulness of the measures for comparison with other companies.
27
Reconciliation of Non-GAAP Financial Measures
Adjusted Operating Income and Adjusted Operating Margin
(Unaudited)
Year Ended March 1, 2025 (52 weeks)
(In thousands, except percentages)
Architectural
Metals
Architectural
Services
Architectural
Glass
Performance
Surfaces
Corporate
and other
Consolidated
Operating income
$
42,466
$
30,046
$
59,274
$
19,611
$
(33,287) $
118,110
Acquisition-related costs (1)
Transaction
—
—
—
—
4,424
4,424
Integration
—
—
—
706
1,349
2,055
Backlog amortization
—
—
—
2,340
—
2,340
Inventory step-up
—
—
—
1,483
—
1,483
Total Acquisition-related costs
—
—
—
4,529
5,773
10,302
Restructuring costs (2)
4,024
(489)
—
—
788
4,323
Impairment expense (3)
7,634
—
—
—
—
7,634
Arbitration award expense (4)
—
—
—
—
9,393
9,393
Adjusted operating income
$
54,124
$
29,557
$
59,274
$
24,140
$
(17,333) $
149,762
Operating margin
8.1 %
7.2 %
18.4 %
16.1 %
N/M
8.7 %
Acquisition-related costs (1)
Transaction
— %
— %
— %
— %
N/M
0.3 %
Integration
— %
— %
— %
0.6 %
N/M
0.2 %
Backlog amortization
— %
— %
— %
1.9 %
N/M
0.2 %
Inventory step-up
— %
— %
— %
1.2 %
N/M
0.1 %
Total Acquisition-related costs
—
—
—
3.7 %
N/M
0.8 %
Restructuring costs (2)
0.8 %
(0.1) %
— %
— %
N/M
0.3 %
Impairment expense (3)
1.5 %
— %
— %
— %
N/M
0.6 %
Arbitration award expense (4)
— %
— %
— %
— %
N/M
0.7 %
Adjusted operating margin
10.3 %
7.0 %
18.4 %
19.8 %
N/M
11.0 %
Year Ended March 2, 2024 (53 weeks)
Architectural
Metals
Architectural
Services
Architectural
Glass
Performance
Surfaces
Corporate
and other
Consolidated
Operating income
$
64,833
$
11,840
$
68,046
$
24,233
$
(35,119) $
133,833
Restructuring costs (2)
5,970
2,526
—
—
3,907
12,403
Adjusted operating income
$
70,803
$
14,366
$
68,046
$
24,233
$
(31,212) $
146,236
Operating margin
10.8 %
3.1 %
18.0 %
24.4 %
N/M
9.4 %
Restructuring costs (2)
1.0 %
0.7 %
— %
— %
N/M
0.9 %
Adjusted operating margin
11.8 %
3.8 %
18.0 %
24.4 %
N/M
10.3 %
(1)
Acquisition-related costs include:
•
Transaction costs related to the UW Solutions acquisition.
•
Integration costs related to one-time expenses incurred to integrate the UW Solutions acquisition.
•
Backlog amortization is related the value attributed to contracting the backlog purchased in the UW Solutions acquisition. These costs were
amortized in SG&A over the period that the contracted backlog was shipped.
•
Inventory step-up is related to the incremental cost to value inventory acquired as part of the UW Solutions acquisition at fair value. These
costs were expensed to cost of goods sold over the period the inventory was sold.
(2)
Restructuring charges related to Project Fortify, including $1.1 million of employee termination costs and $3.2 million of other costs incurred in fiscal
2025. Restructuring charges related to Project Fortify, including $6.2 million of asset impairment charges, $5.9 million of employee termination costs
and $0.3 million of other costs incurred in fiscal 2024.
(3)
Impairment expense for intangible assets in the Architectural Metals Segment.
(4)
Expense related to an arbitration award which represent the impact of the award amount net of existing reserves and estimated insurance proceeds.
28
Reconciliation of Non-GAAP Financial Measures
Adjusted Net Earnings and Adjusted Diluted Earnings Per Share
(Unaudited)
Diluted per share amounts
Year Ended
Year Ended
March 1, 2025
March 2, 2024
March 1, 2025
March 2, 2024
(In thousands, except per share amounts)
(52 weeks)
(53 weeks)
(52 weeks)
(53 weeks)
Net earnings
$
85,052
$
99,613
$
3.89
$
4.51
Acquisition-related costs (1)
Transaction
4,424
—
0.20
—
Integration
2,055
—
0.09
—
Backlog amortization
2,340
—
0.11
—
Inventory step-up
1,483
—
0.07
—
Total Acquisition-related costs
10,302
—
0.47
—
Restructuring costs (2)
4,323
12,403
0.20
0.56
Impairment expense (3)
7,634
—
0.35
—
Arbitration award expense (4)
9,393
—
0.43
—
NMTC Settlement Gain (5)
—
(4,687)
—
(0.21)
Income tax impact on above adjustments (6)
(7,832)
(1,890)
(0.36)
(0.09)
Adjusted net earnings
$
108,872
$
105,439
$
4.97
$
4.77
Shares outstanding for EPS
21,891
22,091
(1)
Acquisition-related costs include:
•
Transaction costs related to the UW Solutions acquisition.
•
Integration costs related to one-time expenses incurred to integrate the UW Solutions acquisition.
•
Backlog amortization is related the value attributed to contracting the backlog purchased in the UW Solutions acquisition. These costs were
amortized in SG&A over the period that the contracted backlog was shipped.
•
Inventory step-up is related to the incremental cost to value inventory acquired as part of the UW Solutions acquisition at fair value. These
costs were expensed to cost of goods sold over the period the inventory was sold.
(2)
Restructuring charges related to Project Fortify, including $1.1 million of employee termination costs and $3.2 million of other costs incurred in fiscal
2025. Restructuring charges related to Project Fortify, including $6.2 million of asset impairment charges, $5.9 million of employee termination costs
and $0.3 million of other costs incurred in fiscal 2024.
(3)
Impairment expense for intangible assets in the Architectural Metals Segment.
(4)
Expense related to an arbitration award which represent the impact of the award amount net of existing reserves and estimated insurance proceeds.
(5)
Realization of a New Markets Tax Credit (NMTC) benefit during the second quarter of fiscal 2024, which was recorded in other (income) expense,
net.
(6)
Income tax impact reflects the estimated tax rate for the jurisdictions in which the charge or income occurred.
29
Reconciliation of Non-GAAP Financial Measures
Adjusted EBITDA and Adjusted EBITDA Margin
(Earnings before interest, taxes, depreciation and amortization)
(Unaudited)
Year Ended
March 1, 2025
March 2, 2024
(In thousands)
(52 weeks)
(53 weeks)
Net earnings
$
85,052
$
99,613
Income tax expense
27,522
29,640
Interest expense, net
6,159
6,669
Depreciation and amortization
44,608
41,588
EBITDA
$
163,341
$
177,510
Acquisition-related costs (1)
Transaction
4,424
—
Integration
2,055
—
Inventory step-up
1,483
—
Total acquisition-related costs
7,962
—
Restructuring costs (2)
4,323
12,403
Impairment expense (3)
7,634
—
Arbitration award expense (4)
9,393
—
NMTC settlement gain (5)
—
(4,687)
Adjusted EBITDA
$
192,653
$
185,226
Adjusted EBITDA Margin
14.2 %
13.1 %
(1)
Acquisition-related costs include:
•
Transaction costs related to the UW Solutions acquisition.
•
Integration costs related to one-time expenses incurred to integrate the UW Solutions acquisition.
•
Inventory step-up is related to the incremental cost to value inventory acquired as part of the UW Solutions acquisition at fair value. These
costs were expensed to cost of goods sold over the period the inventory was sold.
(2)
Restructuring charges related to Project Fortify, including $1.1 million of employee termination costs and $3.2 million of other costs incurred in fiscal
2025. Restructuring charges related to Project Fortify, including $6.2 million of asset impairment charges, $5.9 million of employee termination costs
and $0.3 million of other costs incurred in fiscal 2024.
(3)
Impairment expense for intangible assets in the Architectural Metals Segment.
(4)
Expense related to an arbitration award which represent the impact of the award amount net of existing reserves and estimated insurance proceeds.
(5)
Realization of a New Markets Tax Credit (NMTC) benefit during the second quarter of fiscal 2024, which was recorded in other income (expense), net.
30
Reconciliation of Non-GAAP Financial Measures
Adjusted Return on Invested Capital Reconciliation
(Unaudited)
Year Ended
March 1, 2025
March 2, 2024
(In thousands, except percentages)
(52 weeks)
(53 weeks)
Net earnings
$
85,052
$
99,613
Interest expense, net (after tax)
4,619
5,002
Other income, net (after tax)
(467)
(1,567)
Net operating income after taxes
89,204
103,048
Adjustments:
Acquisition-related costs (1)
10,302
—
Restructuring costs (2)
4,323
12,403
Impairment expense (3)
7,634
—
Arbitration award expense (4)
9,393
—
Total adjustments
$
31,652
$
12,403
Income tax impact on adjustments (5)
7,832
3,101
Adjusted net operating income after taxes
$
113,024
$
112,350
Average invested capital (6)
$
757,178
$
668,555
Return on invested capital (ROIC) (7)
11.8 %
15.4 %
Adjusted ROIC (8)
14.9 %
16.8 %
(1)
Acquisition-related costs include:
•
Transaction costs related to the UW Solutions acquisition.
•
Integration costs related to one-time expenses incurred to integrate the UW Solutions acquisition.
•
Backlog amortization is related the value attributed to contracting the backlog purchased in the UW Solutions acquisition. These costs were
amortized in SG&A over the period that the contracted backlog was shipped.
•
Inventory step-up is related to the incremental cost to value inventory acquired as part of the UW Solutions acquisition at fair value. These
costs were expensed to cost of goods sold over the period the inventory was sold.
(2)
Restructuring charges related to Project Fortify, including $1.1 million of employee termination costs and $3.2 million of other costs incurred in fiscal
2025. Restructuring charges related to Project Fortify, including $6.2 million of asset impairment charges, $5.9 million of employee termination costs
and $0.3 million of other costs incurred in fiscal 2024.
(3)
Impairment expense for intangible assets in the Architectural Metals Segment.
(4)
Expense related to an arbitration award which represent the impact of the award amount net of existing reserves and estimated insurance proceeds.
(5)
Income tax impact reflects the estimated tax rate for the jurisdictions in which the charge or income occurred.
(6)
Average invested capital represents a trailing five quarter average of total assets less average current liabilities (excluding current portion long-term
debt).
(7)
ROIC is calculated by dividing net operating income after taxes by average invested capital.
(8)
Adjusted ROIC is calculated by dividing adjusted net operating income after taxes by average invested capital.
Liquidity and Capital Resources
We rely on cash provided by operations for our material cash requirements, including working capital needs, capital
expenditures, satisfaction of contractual commitments (including principal and interest payments on our outstanding
indebtedness) and shareholder return through dividend payments and share repurchases.
Operating Activities. Net cash provided by operating activities was $125.2 million, compared to $204.2 million. The decrease
in net cash provided by operating activities was primarily driven by cash used for working capital.
Investing Activities. Net cash used by investing activities was $265.9 million, compared to $43.7 million. The increase in net
cash used by investing activities was primarily related to $232.2 million of cash used for the acquisition of UW Solutions.
Financing Activities. Net cash provided by financing activities was $146.0 million, compared to $144.6 million of net cash
used by financing activities. The increase in net cash provided by financing activities was primarily driven by the proceeds of
31
$250.0 million from the delayed draw term loan utilized to finance the UW Solutions acquisition. We returned $67.1 million of
cash to shareholders through share repurchases and dividends, compared to $33.0 million in the prior year.
Additional Liquidity Considerations. We periodically evaluate our liquidity requirements, cash needs and availability of debt
resources relative to acquisition plans, significant capital plans, and other working capital needs.
On July 19, 2024, we entered into a Credit Agreement (the Credit Agreement) with Bank of America, N.A., as administrative
agent, and other lenders. The Credit Agreement provides for an unsecured senior credit facility in an aggregate principal
amount of up to $700.0 million, in which commitments were made through a $450.0 million, five-year revolving credit facility
and a committed $250.0 million delayed draw term loan facility. Borrowings under the revolving credit facility can be in
Canadian dollars (CAD) limited to $25.0 million USD. The term loan facility may be utilized in up to two draw downs, which
are available to be made within one year after the closing date. The senior credit facility has a term of five years with a maturity
date of July 19, 2029.
The Credit Agreement replaces the previous revolving credit facility with Wells Fargo Bank, N.A., as administrative agent, and
other lenders, with maximum borrowings up to $385.0 million, and the two Canadian credit facilities with Bank of Montreal
totaling $25.0 million USD.
As a result of the execution of the Credit Agreement, in fiscal 2025, we recognized a loss, within interest expense of $0.5
million for the write-off of unamortized financing fees related to the previous revolving credit facility. Additionally, we
capitalized $3.0 million of lender fees and $0.8 million of third-party fees incurred in connection with the Credit Agreement,
which were recorded as other non-current assets and will be amortized over the term of the Credit Agreement as interest
expense.
The Credit Agreement contains two maintenance financial covenants that require our Consolidated Leverage Ratio (as defined
in the Credit Agreement) to be less than 3.50 and our Consolidated Interest Coverage Ratio (as defined in the Credit
Agreement) to exceed 3.00. At March 1, 2025, we were in compliance with all covenants as defined under the terms of the
Credit Agreement.
The Credit Agreement also contains an acquisition "holiday." In the event we make an acquisition for which the purchase price
is greater than $75 million, we can elect to increase the maximum Consolidated Leverage Ratio (as defined in the Credit
Agreement) to 4.00 for a period of four consecutive fiscal quarters, commencing with the fiscal quarter in which a qualifying
acquisition occurs. No more than two acquisition holidays can occur during the term of the Credit Agreement, and at least two
fiscal quarters must separate qualifying acquisitions.
Borrowings under the Credit Agreement bear floating interest at either the Base Rate or Term Secured Overnight Financing
Rate (SOFR), or, for CAD borrowings, Canadian Overnight Repo Rate Average (CORRA) plus a margin based on the
Consolidated Leverage Ratio (as defined in the Credit Agreement). For Base Rate borrowings, the margin ranges from 0.25% to
0.75%. For Term SOFR and CORRA borrowings, the margin ranges from 1.25% to 1.75%, with an incremental Term SOFR
and CORRA adjustment of 0.10% and 0.29547%.
The Credit Agreement also contains an "accordion" provision. Under this provision, we can request that the senior credit
facility be increased unlimited additional amounts. Any lender may elect or decline to participate in the requested increase at
their sole discretion.
On November 4, 2024, as part of the acquisition of UW Solutions, and for working capital and general corporate purposes, we
executed a drawdown against the delayed draw term loan facility for $250.0 million.
Outstanding borrowings under the term loan facility were $215.0 million as of March 1, 2025. Outstanding borrowings under
the revolving credit facility were $70.0 million as of March 1, 2025. Outstanding borrowings under the previous revolving
credit facility were $50.0 million as of March 2, 2024. We had no outstanding borrowings under the Canadian facilities as of
March 2, 2024.
At March 2, 2024, debt included $12.0 million of industrial revenue bonds. We had no outstanding industrial revenue bonds as
of March 1, 2025 as in the fourth quarter of fiscal 2025 we paid the remaining balance of these bonds, including principal and
interest outstanding, without penalty.
At March 1, 2025, we had a total of $15.0 million of ongoing letters of credit that expire in fiscal year 2026 and reduce
borrowing capacity under the revolving credit facility. As of March 1, 2025, the amount available for revolving borrowings was
$365.0 million.
32
We acquire the use of certain assets through operating leases, such as property, manufacturing equipment, vehicles and other
equipment. Future payments for such leases, excluding leases with initial terms of one year or less, were $76.9 million at March
1, 2025, with $17.7 million payable within the next 12 months. See Note 8 for further detail surrounding our lease obligations
and the timing of expected future payments.
As of March 1, 2025, we had $10.2 million of open purchase obligations, of which payments totaling $7.3 million are expected
to become due within the next 12 months. These purchase obligations primarily relate to raw material commitments.
We expect to make contributions of approximately $0.4 million to our defined-benefit pension plans in fiscal 2026, which will
equal or exceed our minimum funding requirements.
As of March 1, 2025, we had reserves of $6.0 million and $0.1 million for long-term unrecognized tax benefits and
environmental liabilities, respectively. We are unable to reasonably estimate in which future periods the remaining
unrecognized tax benefits will ultimately be settled.
We are required, in the ordinary course of business, to provide surety or performance bonds that commit payments to our
customers for any non-performance. At March 1, 2025, $394.1 million of our backlog was bonded by performance bonds with a
face value of $1.2 billion. These bonds have expiration dates that align with completion of the purchase order or contract. We
have never been required to make payments under surety or performance bonds with respect to our existing businesses.
Due to our ability to generate strong cash from operations and our borrowing capability under our committed revolving credit
facilities, we believe that our sources of liquidity will be adequate to meet our short-term and long-term liquidity and capital
expenditure needs. In addition, we believe we have the ability to obtain both short-term and long-term debt to meet our
financing needs, including additional sources of debt to finance potential material acquisitions for the foreseeable future. We
also believe we will be able to operate our business so as to continue to be in compliance with our existing debt covenants over
the next fiscal year.
We continually review our portfolio of businesses and their assets and how they support our business strategy and performance
objectives. As part of this review, we may acquire other businesses, pursue geographic expansion, take actions to manage
capacity and further invest in, divest and/or sell parts of our current businesses.
Recently Issued Accounting Pronouncements
See Note 1 for information pertaining to recently issued accounting pronouncements, incorporated herein by reference.
33
Critical Accounting Policies and Estimates
Our analysis of operations and financial condition is based on our consolidated financial statements prepared in accordance with
U.S. GAAP. Preparation of these consolidated financial statements requires us to make estimates and assumptions affecting the
reported amounts of assets and liabilities at the date of the consolidated financial statements, reported amounts of revenues and
expenses during the reporting period and related disclosures of contingent assets and liabilities. Our estimates are evaluated on
an ongoing basis and are drawn from historical experience and other assumptions that we believe to be reasonable under the
circumstances. Actual results could differ under other assumptions or circumstances.
We consider the following items in our consolidated financial statements to require significant estimation or judgment.
Revenue recognition
We generate revenue from the design, engineering and fabrication of architectural glass, curtainwall, window, storefront and
entrance systems, and from installing those products on non-residential buildings. We also manufacture value-added glass,
acrylic, and industrial flooring products. Due to the diverse nature of our operations and various types of contracts with
customers, we have businesses that recognize revenue over time and businesses that recognize revenue at a point in time. We
believe the most significant areas of estimation and judgment are related to our businesses that recognize revenue using the
over-time input method.
Approximately 36% of our total revenue in fiscal 2025 was from longer-term, fixed-price contracts, of which the longer term
and most significant contracts are in our Architectural Services Segment. The contracts for this business have a single, bundled
performance obligation, as this business generally provides interrelated products and services and integrate these products and
services into a combined output specified by the customer. The customer obtains control of this combined output, generally
integrated window systems or installed window and curtainwall systems, over time. We measure progress on these contracts
following an input method, by comparing total costs incurred to-date to the total estimated costs for the contract, and record that
proportion of the total contract price as revenue in the period. Contract costs include materials, labor and other direct costs
related to contract performance. We believe this method of recognizing revenue is consistent with our progress in satisfying our
contract obligations.
Due to the nature of the work required under these long-term contracts, the estimation of total revenue and costs incurred and
remaining to complete on a project is subject to many variables and requires significant judgment. It is common for these
contracts to contain potential bonuses or penalties which are generally awarded or charged upon certain project milestones or
cost or timing targets, and can be based on customer discretion. We estimate variable consideration at the most likely amount to
which we expect to be entitled. We include estimated amounts in the transaction price to the extent that it is probable that a
significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable
consideration is resolved. Our estimates of variable consideration and determination of whether to include estimated amounts in
the transaction price are based largely on our assessments of anticipated performance and all information (historical, current and
forecasted) that is reasonably available to us.
Long-term contracts are often modified to account for changes in contract specifications and requirements of work to be
performed. We consider contract modifications to exist when the modification, generally through a change order, either creates
new or changes existing enforceable rights and obligations, and we evaluate these types of modifications to determine whether
they may be considered distinct performance obligations. In many cases, these contract modifications are for goods or services
that are not distinct from the existing contract, due to the significant integration service provided in the context of the contract.
Therefore, these modifications are generally accounted for as part of the existing contract. The effect of a contract modification
on the transaction price and our measure of progress is recognized as an adjustment to revenue, generally on a cumulative
catch-up basis.
Due to the significant judgments utilized in our revenue recognition on long-term contracts, if subsequent actual results and/or
updated assumptions, estimates, or projections were to change from those utilized at March 1, 2025, our results of operations in
the future could be materially impacted.
Impairment of goodwill and indefinite-lived intangible assets
Goodwill
We evaluate goodwill for impairment annually on the first day in our fiscal fourth quarter, or more frequently if events or
changes in circumstances indicate the carrying value of the goodwill may not be recoverable. Evaluating goodwill for
impairment involves the determination of the fair value of each reporting unit in which goodwill is recorded using a qualitative
or quantitative analysis. A reporting unit is an operating segment, or a component of an operating segment, for which discrete
financial information is available and is reviewed by segment management on a regular basis. The reporting units for our fiscal
34
2025 annual impairment test align with our Architectural Metals, Architectural Services, and Architectural Glass reporting
segments. The Performance Surfaces reporting segment consists of the Tru Vue and UW Solutions reporting units.
For our fiscal 2025 annual impairment test, we elected to bypass the qualitative assessment process and proceed directly to
comparing the fair value of each of our reporting units to carrying value, including goodwill. If fair value exceeds the carrying
value, goodwill impairment is not indicated. If the carrying amount of a reporting unit is higher than its estimated fair value, the
excess is recognized as an impairment expense.
We estimate the fair value of a reporting unit using both the income approach and the market approach. The income approach
uses a discounted cash flow methodology that involves significant judgment and projections of future performance.
Assumptions about future revenues and future operating expenses, capital expenditures and changes in working capital are
based on the annual operating plan and other business plans for each reporting unit. These plans take into consideration
numerous factors, including historical experience, current and future operational plans, anticipated future economic conditions
and growth expectations for the industries and end markets in which we participate. These projections are discounted using a
weighted-average cost of capital, which considers the risk inherent in our projections of future cash flows. We determine the
weighted-average cost of capital for this analysis by weighting the required returns on interest-bearing debt and common equity
capital in proportion to their estimated percentages in an expected capital structure, using published data where possible. We
used discount rates that are commensurate with the risks and uncertainties inherent in the respective businesses and in the
internally developed forecasts. The market approach uses a multiple of earnings and revenue based on publicly traded
companies.
Based on these analyses, estimated fair value exceeded carrying value at all of our reporting units. The discounted cash flow
projections used in these analyses are dependent upon achieving forecasted levels of revenue and profitability. If revenue or
profitability were to fall below forecasted levels, or if market conditions were to decline in a material or sustained manner,
impairment could be indicated at our reporting units and we could incur non-cash impairment expense that would negatively
impact our net earnings. For example, keeping all other assumptions constant, a 100 basis point increase in the weighted
average cost of capital would cause the estimated fair values of our reporting units to decrease in the range of $13 million to
$60 million. In addition, keeping all other assumptions constant, a 100 basis point reduction in the long-term growth rate would
cause the estimated fair values of our reporting units to decrease in the range of $14 million to $31 million. Given the amounts
by which the fair value exceeds the carrying value for each of our reporting units, the decreases in estimated fair values
described above would not have significantly impacted the results of our impairment tests.
Indefinite-lived intangible assets
We have intangible assets for certain acquired trade names and trademarks which we have determined to have indefinite useful
lives. We evaluate the reasonableness of the useful lives and test indefinite-lived intangible assets for impairment annually at
the same measurement date as goodwill, the first day of our fiscal fourth quarter, or more frequently if events or changes in
circumstances indicate that it is more likely than not that the asset is impaired.
For our fiscal 2025 annual impairment test, we bypassed a qualitative assessment and performed a quantitative impairment test
to compare the fair value of each indefinite-lived intangible asset with its carrying value. If the carrying value of an indefinite-
lived intangible asset exceeds its fair value, an impairment expense is recognized in an amount equal to that excess. If an
impairment expense is recognized, the adjusted carrying amount becomes the asset's new accounting basis.
35
Fair value is measured using the relief-from-royalty method. This method assumes the trade name or trademark has value to the
extent that the owner is relieved of the obligation to pay royalties for the benefits received from the asset. This method requires
estimation of future revenue from the related asset, the appropriate royalty rate, and the weighted average cost of capital. The
assessment of fair value involves significant judgment and projections about future performance. In the fair value analysis, we
assumed a discount rate of 12.5%, a royalty rate of 1.5%, and long-term growth rates ranging from 0.0% to 1.5%. Based on our
annual analysis, the carrying amount for certain of our trade names exceeded the fair value, indicating impairment of $7.6
million.
We continue to conclude that the useful lives of our remaining indefinite-lived intangible assets are appropriate. If future
revenue were to fall below forecasted levels or if market conditions were to decline in a material or sustained manner,
impairment could be indicated on these indefinite-lived intangible assets.
Reserves for disputes and claims regarding product liability, warranties and other project-related contingencies
We are subject to claims associated with our products and services, principally as a result of disputes with our customers
involving the performance or aesthetics of our products, some of which may be covered under our warranty policies. We have
in the past and are currently subject to product liability and warranty claims, including certain legal claims related to a
commercial sealant product formerly incorporated into our products. We also are subject to project management and
installation-related contingencies as a result of our fixed-price material supply and installation service contracts, primarily in
our Architectural Services Segment and certain of our Architectural Metals businesses. The time period from when a claim is
asserted to when it is resolved, either by negotiation, settlement or litigation, can be several years. While we maintain various
types of product liability insurance, the insurance policies include significant self-retention of risk in the form of policy
deductibles. In addition, certain claims could be determined to be uninsured. We also actively manage the risk of these
exposures through contract negotiations and proactive project management.
We reserve estimated exposures on known claims, as well as on a portion of anticipated claims for product warranty and rework
costs, based on similar historical product liability claims, as a ratio of sales. We also reserve for estimated exposures on other
claims as they are known and reasonably estimable.
Income taxes
We are required to make judgments regarding the potential tax effects of various financial transactions and ongoing operations
to estimate our obligation to taxing authorities. These tax obligations include income, real estate, franchise and sales/use taxes.
Judgments related to income taxes require the recognition in our financial statements that a tax position is more-likely-than-not
to be sustained on audit.
Judgment and estimation is required in developing the provision for income taxes and the reporting of tax-related assets and
liabilities and, if necessary, any valuation allowances. The interpretation of tax laws can involve uncertainty, since tax
authorities may interpret such laws differently. Actual income tax could vary from estimated amounts and may result in
favorable or unfavorable impacts to net income, cash flows and tax-related assets and liabilities. In addition, the effective tax
rate may be affected by other changes, including the allocation of property, payroll and revenues between states.
We assess the deferred tax assets for recoverability taking into consideration historical and anticipated earnings levels; the
reversal of other existing temporary differences; available net operating losses and tax carryforwards; and available tax
planning strategies that could be implemented to realize the deferred tax assets. Based on this assessment, management must
evaluate the need for, and amount of, a valuation allowance against the deferred tax assets. As facts and circumstances change,
adjustment to the valuation allowance may be required.
36
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We are exposed to ongoing market risk related to changes in interest rates, foreign currency exchange rates and raw material
pricing.
Interest Rate Risk
A rise in interest rates could negatively affect the fair value of our fixed income investments, while serving to provide greater
long-term return potential on these investments. To manage our direct risk from changes in market interest rates, we actively
monitor the interest-sensitive components of our balance sheet, primarily available-for-sale securities, fixed income securities
and debt obligations, and maintain a diversified portfolio in order to minimize the impact of changes in interest rates on net
earnings and cash flow. We do not hold any financial instruments for trading purposes. We also hedge a portion of the floating
interest rate on our long-term line of credit through two floating-to-fixed interest rate swaps.
The primary measure of interest rate risk is the simulation of net income under different interest rate environments. If interest
rates were to increase or decrease over the next 12 months by 200 basis points, net earnings would be impacted by
approximately $0.6 million. Our debt exceeded investments at March 1, 2025, so as interest rates increase, net earnings
decrease; as interest rates decrease, net earnings increase.
In addition to the market risk related to interest rate changes on our financial instruments, the non-residential construction
markets in which our businesses operate are highly affected by changes in interest rates. Increases in interest rates could
adversely impact activity in the non-residential construction industry and our operating results.
Foreign Currency Exchange Rate Risk
We are subject to market risk due to changes in the value of foreign currencies in relation to our reporting currency, the
U.S. dollar.
We have operations in Canada, Brazil, Belgium, and Australia which primarily transact business in local currencies. We
manage these operating activities locally. Revenues, costs, assets and liabilities of these operations are generally denominated in
local currencies, thereby mitigating some of the risk associated with changes in foreign exchange rates. However, our
consolidated financial results are reported in U.S. dollars. Thus, changes in exchange rates between the Canadian dollar,
Brazilian Real, Euro, and Australian dollar versus the U.S. dollar, will impact our reported financial results. From time to time,
we enter into forward purchase foreign currency contracts, generally with an original maturity date of less than one year, to
hedge foreign currency risk (see Note 4). Sales from our domestic operations are generally denominated in U.S. dollars.
Raw Material Pricing Risk
We are subject to market risk exposure related to volatility in the prices of aluminum and lumber, among other raw materials
and supplies used in our end products. A significant amount of our cost of sales relates to materials costs. The commodities
markets, which include the aluminum industry, are highly cyclical in nature. As a result, commodity costs can be volatile.
Commodity costs are influenced by numerous factors beyond our control, including general economic conditions, the
availability of raw materials, competition, labor costs, freight and transportation costs, production costs, tariffs, import duties
and other trade restrictions.
We principally manage our exposures to the market fluctuations in the aluminum industry through forward purchase
agreements. Although we have the ability to purchase aluminum from a number of suppliers, a production cutback by one or
more of our current suppliers could create challenges in meeting delivery schedules to our customers. The prices we offer to our
customers are also impacted by changes in commodity costs. We manage the alignment of the cost of our raw materials and the
prices offered to customers, and attempt to pass changes to raw material costs through to our customers. To improve our
management of commodity costs, we attempt to maintain inventory levels not in excess of our production requirements.
We cannot accurately calculate the pre-tax impact a one percent change in the commodity costs of aluminum and/or lumber
would have on our fiscal 2025 operating results, as the change in commodity costs would both impact the cost to purchase
materials and the selling prices we offer our customers. The impact to our operating results would significantly depend on the
competitive environment and the costs of other alternative products, which could impact our ability to pass commodities costs
to our customers.
37
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Management's Annual Report on Internal Control over Financial Reporting
Management of Apogee Enterprises, Inc. and its subsidiaries (the Company) is responsible for establishing and maintaining
adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) of the Securities Exchange Act of
1934. The Company's internal control over financial reporting is designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally
accepted accounting principles. The Company's internal control over financial reporting includes those policies and procedures
that (1) pertain to maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions
of the assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation
of the financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of
the Company are being made only in accordance with authorizations of management and directors of the Company; and (3)
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the
Company's assets that could have a material effect on the financial statements.
Because of inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of the effectiveness of internal control over financial reporting to future periods are subject to the
risk that the controls may become inadequate because of changes in conditions, or that the degree of compliance with the
policies or procedures may deteriorate.
The Company's management assessed the effectiveness of the Company's internal control over financial reporting as of March
1, 2025, using criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in
Internal Control - Integrated Framework (2013).
On November 4, 2024, we completed our acquisition of UW Solutions. In accordance with Securities Exchange Commission
guidance permitting a company to exclude an acquired business from management’s assessment of the effectiveness of internal
control over financial reporting for the year in which the acquisition is completed, we have excluded UW Solutions from our
assessment of the effectiveness of internal control over financial reporting as of March 1, 2025. The assets and net sales revenue
of UW Solutions that were excluded from our assessment constituted approximately 21.5% and 2.4%, respectively, of the
related consolidated financial statement amounts as of and for the year ended March 1, 2025. The scope of management’s
assessment of the effectiveness of the design and operation of our disclosure controls and procedures as March 1, 2025 includes
all of our consolidated operations except for those disclosure controls and procedures of UW Solutions. See Note 17 for
additional information regarding the UW Solutions acquisition. Based on our assessment, the Company's management believes
that, as of March 1, 2025, the Company's internal control over financial reporting was effective based on those criteria.
Following this report are reports from the Company's independent registered public accounting firm, Deloitte & Touche LLP,
on the Company's consolidated financial statements and on the effectiveness of the Company's internal control over financial
reporting as of March 1, 2025.
38
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the shareholders and the Board of Directors of
Apogee Enterprises, Inc.
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Apogee Enterprises, Inc. and subsidiaries (the "Company")
as of March 1, 2025 and March 2, 2024, and the related consolidated results of operations, statements of comprehensive
earnings, cash flows, and shareholders' equity, for each of the three years in the period ended March 1, 2025, and the related
notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all
material respects, the financial position of the Company as of March 1, 2025 and March 2, 2024, and the results of its
operations and its cash flows for each of the three years in the period ended March 1, 2025, in conformity with accounting
principles generally accepted in the United States of America.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States)
(PCAOB), the Company's internal control over financial reporting as of March 1, 2025, based on criteria established in Internal
Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission
and our report dated April 24, 2025, expressed an unqualified opinion on the Company's internal control over financial
reporting.
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on
the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are
required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable
rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to
error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial
statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included
examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included
evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall
presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that
was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that
are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The
communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and
we are not, by communicating the critical audit matter below, providing separate opinions on the critical audit matter or on the
accounts or disclosures to which it relates.
Net Sales — Revenue Recognition for Long-Term Contracts in the Architectural Services Segment — Refer to Notes 1,
2, and 16 to the consolidated financial statements
The Architectural Services Segment, which provides building glass and curtainwall installation services and operates under
long-term, fixed-price contracts, accounted for approximately $419.9 million, or 31 percent of total net sales for the year ended
March 1, 2025. The contracts for this business typically have a single, bundled performance obligation, as the business
generally provides interrelated products and services and integrates these products and services into a combined output
specified by the customer. The customer obtains control of this combined output, generally integrated window systems or
installed window and curtainwall systems, over time. The Company measures progress on these contracts following an input
method, by comparing total costs incurred to-date to the total estimated costs for the contract and recording that proportion of
the total contract price as revenue.
Given the judgments necessary to estimate total costs and profit for the contract performance obligations used to recognize
revenue for long-term, fixed-price contracts in the Architectural Services Segment, auditing such estimates required extensive
audit effort due to the complexity of long-term contracts and a high degree of auditor judgment when performing audit
procedures and evaluating the results of those procedures.
39
How the Critical Audit Matter Was Addressed in the Audit
Our audit procedures related to management’s estimates of total costs and profit for the contract performance obligations used
to recognize revenue for certain long-term contracts in the Architectural Services Segment included, but were not limited to the
following:
•
We tested the effectiveness of controls over long-term contract revenue, including those over the estimates of total
costs and profit for performance obligations.
•
We developed an expectation of the amount of total long-term contract revenue based on prior year margins applied to
cost of sales in the current year and compared our expectation to the amount of long-term contract revenue ultimately
recorded by management.
•
We evaluated management’s ability to estimate total costs and profit by comparing actual costs and profit to
management’s historical estimates for performance obligations that have been fulfilled.
•
We selected a sample of long-term contracts from the contract portfolio and performed the following procedures:
◦
Evaluated whether the long-term contracts were properly included in management’s calculation of long-term
contract revenue based on the terms and conditions of each contract, including whether continuous transfer of
control to the customer occurred as progress was made toward fulfillment of the performance obligations.
◦
Compared the transaction prices to the consideration expected to be received based on current rights and
obligations under the long-term contracts and any modifications that were agreed upon with the customers.
◦
Tested management’s identification of distinct performance obligations by evaluating whether the underlying
services are highly interdependent and interrelated.
◦
Tested the accuracy and completeness of the costs incurred to date for the performance obligations.
◦
Tested the mathematical accuracy of management’s calculation of long-term contract revenue for the
performance obligation.
•
Evaluated the estimates of total cost and profit for the performance obligations by:
◦
Comparing costs incurred to date to the costs management estimated to be incurred to date.
◦
Evaluating management’s ability to achieve the estimates of total cost and profit by performing corroborating
inquiries with the Company’s project managers and engineers, and comparing the estimates to management’s
work plans, engineering specifications, and supplier contracts.
/s/ Deloitte & Touche LLP
Minneapolis, MN
April 24, 2025
We have served as the Company's auditor since fiscal 2003.
40
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the shareholders and the Board of Directors of
Apogee Enterprises, Inc.
Opinion on Internal Control over Financial Reporting
We have audited the internal control over financial reporting of Apogee Enterprises, Inc. and subsidiaries (the “Company”) as
of March 1, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of
Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material
respects, effective internal control over financial reporting as of March 1, 2025, based on criteria established in Internal Control
— Integrated Framework (2013) issued by COSO.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States)
(PCAOB), the consolidated financial statements as of and for the year ended March 1, 2025, of the Company and our report
dated April 24, 2025, expressed an unqualified opinion on those financial statements.
As described in Management's Annual Report on Internal Control over Financial Reporting, management excluded from its
assessment the internal control over financial reporting at UW Solutions, which was acquired on November 4, 2024, and whose
financial statements constitute approximately 21.5% and 2.4% of assets and net sales revenue, respectively, of the consolidated
financial statement amounts as of and for the year ended March 1, 2025. Accordingly, our audit did not include the internal
control over financial reporting at UW Solutions.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its
assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's
Annual Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s
internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are
required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable
rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all
material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk
that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the
assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit
provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally
accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures
that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and
dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and
expenditures of the company are being made only in accordance with authorizations of management and directors of the
company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or
disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate
because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ Deloitte & Touche LLP
Minneapolis, MN
April 24, 2025
41
CONSOLIDATED BALANCE SHEETS
(In thousands, except per share data)
March 1, 2025
March 2, 2024
Assets
Current assets
Cash and cash equivalents
$
41,448 $
37,216
Receivables, net
185,590
173,557
Inventories, net
92,305
69,240
Contract assets
71,842
49,502
Other current assets
50,919
29,124
Total current assets
442,104
358,639
Property, plant and equipment, net
268,139
244,216
Operating lease right-of-use assets
62,314
40,221
Goodwill
235,775
129,182
Intangible assets, net
128,417
66,114
Other non-current assets
38,520
45,692
Total assets
$
1,175,269 $
884,064
Liabilities and Shareholders’ Equity
Current liabilities
Accounts payable
$
98,804 $
84,755
Accrued compensation and benefits
48,510
53,801
Contract liabilities
35,193
34,755
Operating lease liabilities
15,290
12,286
Other current liabilities
87,659
59,108
Total current liabilities
285,456
244,705
Long-term debt
285,000
62,000
Non-current operating lease liabilities
51,632
31,907
Non-current self-insurance reserves
30,382
30,552
Other non-current liabilities
34,901
43,875
Commitments and contingent liabilities (Note 10)
Shareholders’ equity
Junior preferred stock of $1.00 par value; authorized 200,000 shares; zero
issued and outstanding
—
—
Common stock of $0.33-1/3 par value; authorized 50,000,000 shares; issued and
outstanding 21,417,631 and 22,089,265 shares, respectively
7,139
7,363
Additional paid-in capital
156,075
152,818
Retained earnings
359,976
340,375
Accumulated other comprehensive loss
(35,292)
(29,531)
Total shareholders’ equity
487,898
471,025
Total liabilities and shareholders’ equity
$
1,175,269 $
884,064
See accompanying notes to consolidated financial statements.
42
CONSOLIDATED RESULTS OF OPERATIONS
Year-Ended
March 1, 2025
March 2, 2024
February 25, 2023
(In thousands, except per share data)
(52 weeks)
(53 weeks)
(52 weeks)
Net sales
$
1,360,994 $
1,416,942 $
1,440,696
Cost of sales
1,001,101
1,049,814
1,105,423
Gross profit
359,893
367,128
335,273
Selling, general and administrative expenses
241,783
233,295
209,485
Operating income
118,110
133,833
125,788
Interest expense, net
6,159
6,669
7,660
Other (income) expense, net
(623)
(2,089)
1,507
Earnings before income taxes
112,574
129,253
116,621
Income tax expense
27,522
29,640
12,514
Net earnings
$
85,052 $
99,613 $
104,107
Basic earnings per share
$
3.91 $
4.55 $
4.73
Diluted earnings per share
$
3.89 $
4.51 $
4.64
Weighted average basic shares outstanding
21,726
21,871
22,007
Weighted average diluted shares outstanding
21,891
22,091
22,416
See accompanying notes to consolidated financial statements.
43
CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS
Year-Ended
March 1, 2025
March 2, 2024
February 25, 2023
(In thousands)
(52 weeks)
(53 weeks)
(52 weeks)
Net earnings
$
85,052 $
99,613 $
104,107
Other comprehensive (loss) earnings:
Unrealized gain (loss) on marketable securities, net of $49,
$59 and $(131) of tax expense (benefit), respectively
184
222
(492)
Unrealized loss on derivative instruments, net of $(135),
$(22) and $(672) of tax benefit, respectively
(442)
(72)
(2,205)
Unrealized gain on pension obligation, net of $23, $261
and $222 of tax expense, respectively
79
857
726
Foreign currency translation adjustments
(5,582)
1,018
(3,345)
Other comprehensive (loss) earnings
(5,761)
2,025
(5,316)
Total comprehensive earnings
$
79,291 $
101,638 $
98,791
See accompanying notes to consolidated financial statements.
44
CONSOLIDATED STATEMENTS OF CASH FLOWS
Year-Ended
March 1, 2025
March 2, 2024
February 25, 2023
(In thousands)
(52 weeks)
(53 weeks)
(52 weeks)
Operating Activities
Net earnings
$
85,052
$
99,613
$
104,107
Adjustments to reconcile net earnings to net cash provided by operating
activities:
Depreciation and amortization
44,608
41,588
42,403
Share-based compensation
10,725
9,721
8,656
Deferred income taxes
3,836
(9,748)
(7,185)
Asset impairment on property, plant and equipment
—
6,195
—
Loss (gain) on disposal of property, plant and equipment
408
826
(3,815)
Impairment on intangible assets
7,634
—
—
Proceeds from New Markets Tax Credit transaction, net of deferred
costs
—
—
18,390
Settlement of New Markets Tax Credit transaction
—
(4,687)
(19,523)
Non-cash lease expense
13,749
11,721
11,878
Other, net
(1,247)
4,615
5,399
Changes in operating assets and liabilities:
Receivables
(508)
23,993
(62,304)
Inventories
(5,810)
9,366
1,731
Contract assets
(22,625)
9,880
(3,380)
Accounts payable
9,595
(2,655)
(5,491)
Accrued compensation and benefits
(11,793)
2,102
(1,810)
Contract liabilities
598
6,590
20,952
Operating lease liability
(12,703)
(12,632)
(12,149)
Accrued income taxes
(5,120)
6,523
(6,976)
Other current assets and liabilities
8,763
1,143
11,813
Net cash provided by operating activities
125,162
204,154
102,696
Investing Activities
Capital expenditures
(35,593)
(43,180)
(45,177)
Proceeds from sales of property, plant and equipment
693
293
7,755
Purchases of marketable securities
(2,394)
(2,953)
—
Sales/maturities of marketable securities
3,570
2,165
9,712
Acquisition of business, net of cash acquired
(232,169)
—
—
Net cash used in investing activities
(265,893)
(43,675)
(27,710)
Financing Activities
Proceeds from revolving credit facilities
77,201
196,964
485,879
Repayment on revolving credit facilities
(57,201)
(304,817)
(327,865)
Proceeds from term loans
250,000
—
—
Repayment of debt
(47,000)
—
(151,000)
Payments of debt issuance costs
(3,798)
—
—
Repurchase of common stock
(45,364)
(11,821)
(74,312)
Dividends paid
(21,737)
(21,133)
(19,670)
Other, net
(6,052)
(3,800)
(4,055)
Net cash provided by (used in) financing activities
146,049
(144,607)
(91,023)
Effect of exchange rates on cash
(1,086)
(129)
(73)
Increase in cash, cash equivalents and restricted cash
4,232
15,743
(16,110)
Cash, cash equivalents and restricted cash at beginning of period
37,216
21,473
37,583
Cash and cash equivalents at end of period
$
41,448
$
37,216
$
21,473
Non-cash Activity
Capital expenditures in accounts payable
$
3,313
$
3,588
$
2,909
See accompanying notes to consolidated financial statements.
45
Consolidated Statements of Shareholders' Equity
(In thousands, except per share data)
Common
Shares
Outstanding
Common Stock
at Par Value
Additional
Paid-In Capital
Retained
Earnings
Accumulated
Other
Comprehensive
(Loss) Income
Total
Shareholders'
Equity
Balance at February 26, 2022
23,701
$
7,901
$
149,713
$
254,825
$
(26,240) $
386,199
Net earnings
—
—
—
104,107
—
104,107
Other comprehensive income, net of tax
—
—
—
—
(5,316)
(5,316)
Issuance of stock, net of cancellations
113
37
153
35
—
225
Share-based compensation
—
—
8,656
—
—
8,656
Exercise of stock options
36
12
(954)
—
—
(942)
Share repurchases
(1,571)
(524)
(10,350)
(63,438)
—
(74,312)
Other share retirements
(55)
(18)
(402)
(2,119)
—
(2,539)
Cash dividends ($0.9000 per share)
—
—
—
(19,670)
—
(19,670)
Balance at February 25, 2023
22,224
$
7,408
$
146,816
$
273,740
$
(31,556) $
396,408
Net earnings
—
—
—
99,613
—
99,613
Other comprehensive income, net of tax
—
—
—
—
2,025
2,025
Issuance of stock, net of cancellations
171
58
(150)
(40)
—
(132)
Share-based compensation
—
—
9,721
—
—
9,721
Exercise of stock options
25
8
(840)
—
—
(832)
Share repurchases
(280)
(93)
(1,989)
(9,739)
—
(11,821)
Other share retirements
(51)
(18)
(740)
(2,066)
—
(2,824)
Cash dividends ($0.9700 per share)
—
—
—
(21,133)
—
(21,133)
Balance at March 2, 2024
22,089
$
7,363
$
152,818
$
340,375
$
(29,531) $
471,025
Net earnings
—
—
—
85,052
—
85,052
Other comprehensive income, net of tax
—
—
—
—
(5,761)
(5,761)
Issuance of stock, net of cancellations
214
71
(312)
241
—
—
Share-based compensation
—
—
10,725
—
—
10,725
Share repurchases
(787)
(263)
(6,415)
(38,686)
—
(45,364)
Other share retirements
(98)
(32)
(741)
(5,269)
—
(6,042)
Cash dividends ($1.0100 per share)
—
—
—
(21,737)
—
(21,737)
Balance at March 1, 2025
21,418
$
7,139
$
156,075
$
359,976
$
(35,292) $
487,898
See accompanying notes to consolidated financial statements.
46
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1.
Summary of Significant Accounting Policies and Related Data
Basis of consolidation
The consolidated financial statements include the balances of Apogee Enterprises, Inc. and its subsidiaries (Apogee, we, us, our
or the Company) after elimination of intercompany balances and transactions. We consolidate variable interest entities related
to our New Markets Tax Credit transactions as it has been determined that the Company is the primary beneficiary of those
entities' operations (refer to Note 10 for more information).
Fiscal year
Our fiscal year ends on the Saturday closest to the last day of February. Fiscal 2025 and fiscal 2023 each consisted of 52 weeks,
while fiscal 2024 consisted of 53 weeks.
Accounting estimates
The preparation of the consolidated financial statements in conformity with U.S. generally accepted accounting principles
requires management to make estimates and assumptions that affect the reported amounts in the consolidated financial
statements and accompanying notes. Actual results could differ significantly from those estimates.
Cash equivalents
Highly liquid investments with an original maturity of three months or less are included in cash equivalents and are stated at
cost, which approximates fair value.
Restricted cash
Cash held that is specifically dedicated to fund each capital project related to our New Markets Tax Credit transactions.
Marketable securities
To the extent the amortized cost basis of the available-for-sale securities exceeds the fair value, we assess the debt securities for
credit loss. When assessing the risk of credit loss, we consider factors such as the severity and the reason of the decline in value,
including any changes to the rating of the security by a rating agency or other adverse conditions specifically related to the
security, and management's intended holding period and time horizon for selling. During fiscal 2025, 2024, and 2023, the
Company did not recognize any credit losses related to its available-for-sale securities. Further, as of March 1, 2025 and March
2, 2024, the Company did not record an allowance for credit losses related to its available-for-sale securities. Marketable
securities are included in other current and non-current assets on the consolidated balance sheets and gross realized gains and
losses are included in other (income) expense, net in our consolidated results of operations.
Inventories
Inventories, which consist primarily of purchased glass and aluminum, are valued at lower of cost or net realizable value using
the first-in, first-out (FIFO) method.
Property, plant and equipment
Property, plant and equipment (PP&E) is recorded at cost. Significant improvements and renewals that extend the useful life of
the asset are capitalized. Repairs and maintenance items are generally charged to expense when incurred. When an asset is
retired or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts and any related
gains or losses are included in selling, general and administrative expenses. Long-lived assets to be held and used, such as
PP&E, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be
recoverable.
Depreciation is computed on a straight-line basis, based on estimated useful lives of 10 to 45 years for buildings and
improvements; 3 to 15 years for machinery and equipment; and 3 to 10 years for computer and office equipment and furniture.
47
Impairment of long-lived assets
Long-lived assets or asset groups, including definite-lived intangible assets subject to amortization and property and equipment,
are reviewed for impairment whenever events or changes in circumstances such as asset utilization, physical change, legal
factors or other matters indicate that the carrying value of those assets may not be recoverable. When this review indicates the
carrying value of an asset or asset group exceeds the sum of the undiscounted cash flows expected to result from the use and
eventual disposition of the asset or asset group, an asset impairment expense is recognized in earnings in the period such a
determination is made. The amount of the impairment expense recorded is the amount by which the carrying value of the
impaired asset or asset group exceeds its fair value based on discounted cash flows.
As a result of restructuring plans announced during the fourth quarter of fiscal 2024, asset impairments on property, plant and
equipment and leases in the amount of $6.2 million were recorded for the year ended March 2, 2024.
Goodwill and intangible assets
Goodwill
Goodwill represents the excess of the cost over the net tangible and identified intangible assets of acquired businesses. We
evaluate goodwill for impairment annually on the first day in our fiscal fourth quarter, or more frequently if events or changes
in circumstances indicate the carrying value of the goodwill may not be recoverable.
Evaluating goodwill for impairment involves the determination of the fair value of each reporting unit in which goodwill is
recorded using a qualitative or quantitative analysis. A reporting unit is an operating segment or a component of an operating
segment for which discrete financial information is available and reviewed by segment management on a regular basis.
During the third quarter of fiscal 2025, we acquired UW Interco, LLC (UW Solutions). As a result, we reassessed our reporting
units. The reporting units for our fiscal 2025 annual impairment test align with our reporting segments for Architectural Metals,
Architectural Services, and Architectural Glass. The Performance Surfaces reporting segment consists of the Tru Vue and UW
Solutions reporting units. No qualitative indicators of impairment were identified during the fourth quarter of fiscal 2025.
We estimate the fair value of a reporting unit using both the income approach and the market approach. The income approach
uses a discounted cash flow methodology that involves significant judgment and projections of future performance.
Assumptions about future revenues and future operating expenses, capital expenditures and changes in working capital are
based on the annual operating plan and other business plans for each reporting unit. These plans take into consideration
numerous factors, including historical experience, current and future operational plans, anticipated future economic conditions
and growth expectations for the industries and end markets in which we participate. These projections are discounted using a
weighted-average cost of capital, which considers the risk inherent in our projections of future cash flows. We determine the
weighted-average cost of capital for this analysis by weighting the required returns on interest bearing debt and common equity
capital in proportion to their estimated percentages in an expected capital structure, using published data where possible. We
used discount rates that are commensurate with the risks and uncertainties inherent in the respective businesses and in the
internally developed forecasts. The market approach uses a multiple of earnings and revenue based on guidelines for publicly
traded companies.
Intangible assets
We have intangible assets for certain acquired trade names and trademarks which are determined to have indefinite useful lives.
We test indefinite-lived intangible assets for impairment annually at the same measurement date as goodwill, the first day of our
fiscal fourth quarter, or more frequently if events or changes in circumstances indicate that it is more likely than not that the
asset is impaired. If the carrying amount of an indefinite-lived intangible asset exceeds its fair value, an impairment expense is
recognized in an amount equal to that excess. If an impairment expense is recognized, the adjusted carrying amount becomes
the asset's new accounting basis.
Fair value of indefinite-lived intangible assets is measured using the relief-from-royalty method. This method assumes the trade
name or trademark has value to the extent that the owner is relieved of the obligation to pay royalties for the benefits received
from the asset. This method requires estimation of future revenue from the related asset, the appropriate royalty rate, and the
weighted average cost of capital. The assessment of fair value involves significant judgment and projections about future
performance. Based on our annual impairment analysis and changes to our branding strategies in the fourth quarter of fiscal
2025, the carrying amount for certain of our trade names exceeded the fair value. As a result, we recorded a non-cash
impairment charge of $7.6 million in the fourth quarter of fiscal 2025.
Definite-lived intangible assets are amortized based on estimated useful lives ranging from 18 months to 30 years and are
reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be
recoverable. We use undiscounted cash flows to determine whether impairment exists and measure any impairment loss using
discounted cash flows to determine the fair value of long-lived assets.
48
The estimated useful lives of all intangible assets are reviewed annually, and we have determined that the remaining lives were
appropriate. Refer to Note 6 for additional information.
Leases
We have commercially negotiated leases where we recognize a right-of-use asset and lease liability on our consolidated balance
sheet at lease commencement for leases with terms greater than twelve months. The initial lease liability is recognized at the
present value of remaining lease payments over the lease term. Leases with an initial term of twelve months or less are not
recorded on our consolidated balance sheet. We recognize lease expense for operating leases on a straight-line basis over the
lease term. We combine lease and non-lease components, such as common area maintenance costs, in calculating the related
asset and lease liabilities for all underlying asset groups. Refer to Note 8 for additional information.
Self-Insurance
We obtain commercial insurance to provide coverage for potential losses in areas such as employment practices, workers'
compensation, directors and officers, automobile, architect's and engineer's errors and omissions, product rework and general
liability. A substantial portion of this risk is retained on a self-insured basis through our wholly-owned insurance subsidiary.
We establish a reserve for estimated ultimate losses on reported claims and those incurred but not yet reported utilizing actuarial
projections. Reserves are classified within other current liabilities or non-current self-insurance reserves based on expectations
of when the estimated loss will be paid.
Additionally, we maintain a self-insurance reserve for health insurance programs offered to eligible employees, included within
other current liabilities on the consolidated balance sheets. The reserve includes an estimate for losses on reported claims as
well as for amounts incurred but not yet reported, based on historical trends.
Warranty and project-related contingencies
We are subject to claims associated with our products and services, principally as a result of disputes with our customers
involving the performance or aesthetics of our architectural products and services. We reserve estimated exposures on known
claims, as well as on a portion of anticipated claims for product warranty and rework costs, based on historical product liability
claims as a ratio of sales. We also reserve for estimated backcharge exposures or other claims as they are known and reasonably
estimable. Reserves are included in other current and non-current liabilities based on the estimated timing of dispute resolution.
Foreign currency
Local currencies are considered the functional currencies for our subsidiaries outside of the United States. Assets and liabilities
of these subsidiaries are translated at the exchange rates at the balance sheet date. Income and expense items are translated
using average monthly exchange rates. Translation adjustments are included in accumulated other comprehensive loss in the
consolidated balance sheets.
Derivatives and hedging activities
We are exposed to, among other risks, the impact of changes in aluminum prices, foreign currency exchange rates, and interest
rates in the normal course of business. In order to manage the exposure and volatility arising from these risks, we may utilize
derivative financial instruments to offset a portion of these risks. We use derivative financial instruments to hedge identified
business risks, and do not hold or issue derivative financial instruments for trading purposes and are not a party to leveraged
derivatives.
All derivative instruments within the scope of ASC 815, Derivatives and Hedging, are recorded as either assets or liabilities at
fair value on the consolidated balance sheets. All hedging instruments that qualify for hedge accounting are designated and
effective as hedges with changes recognized in other comprehensive earnings (loss). Instruments that do not qualify for hedge
accounting are marked to market with changes recognized directly in net earnings. Cash flows from derivative instruments are
classified in the statements of cash flows in the same category as the cash flows from the items subject to designated hedge or
undesignated (economic) hedge relationships. Refer to Note 4 for additional information.
Revenue recognition
Our accounting policy for revenue recognition follows ASC 606, Revenue from Contracts with Customers. We generate
revenue from the design, engineering and fabrication of architectural glass, curtainwall, window, storefront and entrance
systems, and from installing those products on non-residential buildings. We also coat and fabricate value-added glass,
aluminum, acrylic and medium-density fiberboard products. Due to the diverse nature of our operations and various types of
arrangements with customers, we have businesses that recognize revenue at shipment, businesses that recognize revenue
following an over-time input method and businesses that recognize revenue following an over-time output method.
49
Approximately 42% of our fiscal 2025 revenue was recognized at the time products were shipped from our manufacturing
facilities, which is when control is transferred to our customer. These businesses do not generate contract-related assets or
liabilities. Variable consideration associated with these contracts and orders, generally related to early pay discounts or volume
rebates, is not considered significant.
Approximately 36% of our fiscal 2025 revenue was from fixed-price contracts, following an over-time input method. The
contracts for these businesses have a single, bundled performance obligation, as these businesses generally provide interrelated
products and services and integrate these products and services into a combined output specified by the customer. The customer
obtains control of this combined output, generally integrated window systems or installed window and curtainwall systems,
over time. We measure progress on these contracts following an input method, by comparing total costs incurred to-date to the
total estimated costs for the contract, and record that proportion of the total contract price as revenue in the period. Contract
costs include materials, labor and other direct costs related to contract performance. We believe this method of recognizing
revenue is consistent with our progress in satisfying our contract obligations.
Due to the nature of the work required under these long-term contracts, the estimation of total revenue and costs incurred
throughout a project is subject to many variables and requires significant judgment. It is common for these contracts to contain
potential bonuses or penalties which are generally awarded or charged upon certain project milestones or cost or timing targets,
and these can be based on customer discretion. We estimate variable consideration at the most likely amount to which we
expect to be entitled. We include estimated amounts in the transaction price to the extent that it is probable that a significant
reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is
resolved. Our estimates of variable consideration and determination of whether to include estimated amounts in the transaction
price are based largely on our assessments of anticipated performance and all information (historical, current and forecasted)
that is reasonably available to us.
Long-term contracts are often modified to account for changes in contract specifications and requirements of work to be
performed. We consider contract modifications to exist when the modification, generally through a change order, either creates
new or changes existing enforceable rights and obligations, and we evaluate these types of modifications to determine whether
they may be considered distinct performance obligations. In most cases, these contract modifications are for goods or services
that are not distinct from the existing contract, due to the significant integration service provided in the context of the contract.
Therefore, these modifications are accounted for as part of the existing contract. The effect of a contract modification on the
transaction price and our measure of progress is recognized as an adjustment to revenue, generally on a cumulative catch-up
basis.
The net cumulative catch-up adjustments on our longer-term contracts for changes in estimates had the following effect on the
respective periods shown:
(in thousands, except earnings per share data)
Year Ended
March 1, 2025
March 2, 2024
February 25, 2023
(52 weeks)
(53 weeks)
(52 weeks)
Operating income
$
16,307 $
5,760 $
13,422
Earnings per share:
Basic
$
0.57 $
0.20 $
0.46
Diluted
$
0.56 $
0.20 $
0.45
Typically, under these fixed-price contracts, we bill our customers following an agreed-upon schedule based on work
performed. Because the progress billings do not generally correspond to our measurement of revenue on a contract, we generate
contract assets when we have recognized revenue in excess of the amount billed to the customer. We generate contract
liabilities when we have billed the customer in excess of revenue recognized on a contract.
Approximately 22% of our fiscal 2025 revenue was recognized following an over-time output method based upon units
produced. The customer is considered to have control over the products at the time of production, as the products are highly
customized with no alternative use, and we have an enforceable right to payment for performance completed over the
production period. We believe this over-time output method of recognizing revenue reasonably depicts the fulfillment of our
performance obligations under our contracts. Billings still occur upon shipment. Therefore, contract assets are generated for the
unbilled amounts on contracts when production is complete. Variable consideration associated with these orders, generally
related to early pay discounts, is not considered significant.
50
Additionally, we have made the following policy elections associated with revenue recognition:
•
We account for shipping and handling activities that occur after control of the related goods transfers to the customer
as fulfillment activities, instead of assessing such activities as performance obligations.
•
We exclude from the transaction price all sales taxes related to revenue-producing transactions that are collected from
the customer for a government authority. We are considered a pass-through conduit for collecting and remitting sales
taxes.
•
We generally expense incremental costs of obtaining a contract when incurred because the amortization period would
be less than one year. These costs primarily relate to sales commissions and are included in selling, general and
administrative expenses.
•
We do not adjust contract price for a significant financing component, as we expect the period between when our
goods and services are transferred to the customer and when the customer pays for those goods and services to be less
than a year.
Shipping and handling
Amounts billed to a customer in a sales transaction related to shipping and handling are reported as revenue. Costs we incur for
shipping and handling are reported as cost of sales.
Restructuring
Restructuring charges are recorded as a result of fundamental changes in the manner in which certain business functions are
conducted, including initiatives to drive earnings and cash flow growth and to realign and simplify our business structure. These
charges primarily consist of employee severance benefits, asset impairments on property, plant and equipment and operating
lease assets and termination penalties for facility closures and consolidations. We record restructuring accruals when it is
probable that a liability has been incurred and the amount of the liability is reasonably estimable. To the extent our assumptions
and estimates differ from our actual costs, subsequent adjustments to restructuring accruals have been, and will be, required.
Restructuring accruals for severance-related costs are included in accrued compensation and related benefits and accruals for
remaining obligations and termination penalties are included in other current liabilities in our consolidated balance sheets. Refer
to Note 18 for additional information.
Research and development
Research and development activities include the development of new products, the modification of existing product designs,
and research related to process improvements. Our research and development expenses were $29.0 million, $30.3 million and
$25.5 million for fiscal 2025, 2024 and 2023, respectively. These costs are expensed as incurred.
Advertising
Advertising costs are expensed as incurred within selling, general and administrative expenses, and were $1.0 million in fiscal
2025, $1.3 million in fiscal 2024, and $1.2 million in fiscal 2023.
Income taxes
The Company recognizes deferred tax assets and liabilities based upon the future tax consequences of temporary differences
between financial statement carrying amounts of assets and liabilities and their respective tax bases. Refer to Note 14 for
additional information.
Subsequent events
We have evaluated subsequent events for potential recognition and disclosure through the date of this filing and determined that
an arbitration award (refer to Note 10) is a subsequent event that required recognition and disclosure in our fiscal 2025
consolidated financial statements and that the announcement of the extension of our restructuring program, Project Fortify
Phase 2, (refer to Note 18) required disclosure in the consolidated financial statements. There were no other events that required
recognition or disclosure.
Adoption of new accounting standards
In the fourth quarter of fiscal 2025, we adopted the guidance in ASU 2023-07, Improvements to Reportable Segment
Disclosures, which expands the required disclosure for reportable segments. This guidance requires entities to disclose
significant segment expenses and other segment items on an annual and interim basis and to provide in interim periods all
segment disclosures which are currently required annually. This ASU additionally requires entities to disclose the title and
position of the individual or the name of the group or committee identified as its chief operating decision-maker.
At the beginning of fiscal 2024, we adopted the guidance in ASU 2022-04, Liabilities – Supplier Finance Programs, Disclosure
of Supplier Finance Program Obligations. The guidance requires that entities that use supplier finance programs disclose
51
information about the nature and potential magnitude of the programs, activity during the period, and changes from period to
period. The adoption of this ASU did not have a significant impact on the consolidated financial statements.
Accounting standards not yet adopted
In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures, intended to enhance the
transparency and decision-usefulness of income tax disclosures. Such guidance requires entities to provide additional
information within their income tax rate reconciliation, including further disclosure of federal, state, and foreign income taxes
and to provide more details about these reconciling items if a quantitative threshold is met. This guidance additionally requires
expanded disclosure of income taxes paid, including amounts paid for federal, state, and foreign taxes. This ASU, which is
required to be applied prospectively, is effective for fiscal years beginning after December 15, 2024, although early adoption
and retrospective application is permitted. While the adoption of this ASU will not have an impact on our financial position
and/or results of operations, we are currently evaluating the impact on our income tax disclosures, including the processes and
controls around the collection of this information.
In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses. This guidance requires
entities to disclose more detailed information about the types of expenses, including purchases of inventory, employee
compensation, depreciation, amortization, and depletion in commonly presented expense captions such as cost of sales and
selling, general and administrative expenses. Such guidance is effective for annual reporting periods beginning after December
15, 2026, and interim reporting periods beginning after December 15, 2027, although early adoption is permitted. This guidance
should be applied either prospectively to financial statements issued for reporting periods after the effective date of this ASU or
retrospectively to any or all prior periods presented in the financial statements. While the adoption of this ASU will not have an
impact on our financial position and/or results of operations, we are currently evaluating the impact this ASU may have on our
consolidated financial statement disclosures, including the processes and controls around the collection of this information.
2.
Revenue, Receivables and Contract Assets and Liabilities
Revenue
The following table disaggregates total revenue by timing of recognition (see Note 16 for disclosure of revenue by segment):
(In thousands)
2025
2024
2023
Recognized at shipment
$
571,140 $
596,270 $
649,792
Recognized over time (input method)
495,562
483,109
514,826
Recognized over time (output method)
294,292
337,563
276,078
Total
$
1,360,994 $
1,416,942 $
1,440,696
Receivables
Receivables reflected in the financial statements represent the net amount expected to be collected. An allowance for credit
losses is established based on expected losses. Expected losses are estimated by reviewing individual accounts, considering
aging, financial condition of the debtor, recent payment history, current and forecast economic conditions and other relevant
factors. Upon billing, aging of receivables is monitored until collection. An account is considered current when it is within
agreed upon payment terms. An account is written off when it is determined that the asset is no longer collectible.
(In thousands)
March 1, 2025
March 2, 2024
Trade accounts
$
117,533 $
115,061
Construction contracts
70,724
61,879
Total receivables
188,257
176,940
Less: allowance for credit losses
2,667
3,383
Receivables, net
$
185,590 $
173,557
52
The following table summarizes the activity in the allowance for credit losses:
(In thousands)
2025
2024
Beginning balance
$
3,383 $
1,796
(Credits) charges against costs and expenses
(1,376)
2,473
Deductions from allowance, net of recoveries
(122)
(901)
Allowance for credit losses from acquisitions
853
—
Other adjustments
(71)
15
Ending balance
$
2,667 $
3,383
Contract assets and liabilities
Contract assets consist of retainage, costs and earnings in excess of billings and other unbilled amounts typically generated
when revenue recognized exceeds the amount billed to the customer. Retainage on construction contracts represents amounts
withheld by our customers on long-term projects until the project reaches a level of completion where amounts are released to
us from the customer. Contract liabilities consist of billings in excess of costs and earnings and other unearned revenue on
contracts.
The time period between when performance obligations are complete and when payment is due is not significant. In certain of
our businesses that recognize revenue over time, progress billings follow an agreed-upon schedule of values.
(In thousands)
March 1, 2025
March 2, 2024
Contract assets
$
71,842 $
49,502
Contract liabilities
35,193
34,755
The change in contract assets and contract liabilities was due to timing of project activity from businesses that operate under
long-term contracts.
Other contract-related disclosures
(In thousands)
2025
2024
Revenue recognized related to contract liabilities from prior year-end
$
30,785 $
25,342
Revenue recognized related to prior satisfaction of performance obligations
16,202
9,257
Some of our contracts have an expected duration of longer than a year, with performance obligations extending over that time
frame. Generally, these contracts are found in our businesses that typically operate with long-term contracts, which recognize
revenue over time. The transaction price associated with unsatisfied performance obligations at March 1, 2025 are expected to
be satisfied, and the corresponding revenue to be recognized, over the following estimated time periods:
(In thousands)
2025
Within one year
$
555,900
More than one but less than two years
238,754
Beyond two years
81,331
Total
$
875,985
3.
Supplemental Balance Sheet Information
Inventories
(In thousands)
March 1, 2025
March 2, 2024
Raw materials
$
36,804 $
31,363
Work-in-process
15,554
12,291
Finished goods
39,947
25,586
Total inventories, net
$
92,305 $
69,240
53
Other current liabilities
(In thousands)
March 1, 2025
March 2, 2024
Arbitration award payable
$
20,182 $
—
Accrued self-insurance reserves
18,240
17,592
Warranties and backcharges
17,557
18,874
Deferred benefit from New Markets Tax Credit transactions
9,250
—
Income and other taxes
5,813
7,202
Other
16,617
15,440
Total other current liabilities
$
87,659 $
59,108
Other non-current liabilities
(In thousands)
March 1, 2025
March 2, 2024
Deferred warranty revenue
$
10,154 $
10,274
Deferred compensation plan
5,590
5,938
Retirement plan obligations
4,640
4,769
Deferred tax liabilities
1,256
1,456
Deferred benefit from New Markets Tax Credit transactions
—
9,250
Other
13,261
12,188
Total other non-current liabilities
$
34,901 $
43,875
4.
Financial Instruments
Marketable Securities
Through our wholly-owned insurance subsidiary, Prism Assurance, Ltd. (Prism), we hold the following available-for-sale
marketable securities, made up of municipal and corporate bonds:
(In thousands)
Amortized Cost
Gross Unrealized
Gains
Gross Unrealized
Losses
Estimated Fair
Value
March 1, 2025
$
10,148 $
33 $
222 $
9,959
March 2, 2024
11,327
15
437
10,905
Prism insures a portion of our general liability, workers' compensation and automobile liability risks using reinsurance
agreements to meet statutory requirements. The reinsurance carrier requires Prism to maintain fixed-maturity investments, for
the purpose of providing collateral for Prism's obligations under the reinsurance agreements.
The amortized cost and estimated fair values of our municipal and corporate bonds at March 1, 2025, by contractual maturity,
are shown below. Expected maturities may differ from contractual maturities, as borrowers may have the right to call or prepay
obligations with or without penalty. Investments that are due within one year are included in other current assets while those
due after one year are included as other non-current assets. Gross realized gains and losses were insignificant for all periods
presented.
(In thousands)
Amortized Cost
Estimated Fair
Value
Due within one year
$
4,829 $
4,798
Due after one year through five years
5,319
5,161
Total
$
10,148 $
9,959
Derivative instruments
We may use interest rate swaps, currency put options, forward purchase contracts, or other instruments to manage risks
generally associated with foreign exchange rate, interest rate and commodity price fluctuations. The information that follows
explains the various types of derivatives and financial instruments used, how such instruments are accounted for, and how such
instruments impact our financial position and performance.
54
In fiscal 2020, we entered into an interest rate swap with a notional value of $30 million with an expiration date of February 5,
2026, to hedge a portion of our exposure to variability in cash flows from interest payments on our floating-rate revolving credit
facility.
In fiscal 2025, we entered into an interest rate swap with a notional value of $75 million with an expiration date of January 5,
2027, to hedge a portion of our exposure to variability in cash flows from interest payments on our floating-rate revolving credit
facility.
We periodically enter into forward purchase contracts to manage the risk associated with fluctuations in foreign currency rates
(primarily related to the Canadian dollar and Euro) and aluminum prices, generally with an original maturity date of less than
one year. As of March 1, 2025, we held foreign exchange option contracts with U.S. dollar notional values of $1.5 million.
The mark to market adjustments on these derivative instruments are recorded within our consolidated balance sheets within
other current assets and other current liabilities. Gains or losses associated with these instruments are recorded as a component
of accumulated other comprehensive loss until which time the hedged transaction is settled and gains or losses are reclassified
to earnings.
Fair value measurements
Financial assets and liabilities are classified in the fair value hierarchy based on the lowest level input that is significant to the
fair value measurement: Level 1 (unadjusted quoted prices in active markets for identical assets or liabilities); Level 2
(observable market inputs, other than quoted prices included in Level 1); and Level 3 (unobservable inputs that cannot be
corroborated by observable market data). We do not have any Level 3 assets or liabilities.
Financial assets and liabilities measured at fair value on a recurring basis were:
(In thousands)
Quoted Prices in
Active Markets
(Level 1)
Other Observable
Inputs (Level 2)
Total Fair Value
March 1, 2025
Assets:
Money market funds
$
20,758
$
—
$
20,758
Municipal bonds
—
9,959
9,959
Foreign currency option contract
—
29
29
Interest rate swap contracts
—
539
539
Liabilities:
Interest rate swap contracts
—
540
540
March 2, 2024
Assets:
Money market funds
$
26,529
$
—
$
26,529
Municipal bonds
—
10,905
10,905
Foreign currency option contracts
—
3
3
Interest rate swap contracts
—
1,292
1,292
Liabilities:
Aluminum hedging contracts
—
529
529
Money market funds
Fair value of money market funds was determined based on quoted prices for identical assets in active markets. These assets are
included within cash and cash equivalents on our consolidated balance sheets.
Municipal bonds
Municipal bonds were measured at fair value based on market prices from recent trades of similar securities and are classified
within our consolidated balance sheets as other current or other non-current assets based on maturity date.
Derivative instruments
The interest rate swaps are measured at fair value using other observable market inputs, based off benchmark interest rates.
Forward foreign exchange and forward purchase aluminum contracts are measured at fair value using other observable market
inputs, such as quotations on forward foreign exchange points, foreign currency exchange rates and forward purchase aluminum
prices. Derivative positions are primarily valued using standard calculations and models that use as their basis readily
55
observable market parameters. Industry standard data providers are our primary source for forward and spot rate information for
interest and currency rates and aluminum prices.
Nonrecurring fair value measurements
We measure certain financial instruments at fair value on a nonrecurring basis including goodwill, intangible assets, property
and equipment and right-of-use lease assets. These assets were initially measured and recognized at amounts equal to the fair
value determined as of the date of acquisition or purchase, subject to changes in value only for foreign currency translation.
Periodically, these assets are tested for impairment, by comparing their respective carrying values to the estimated fair value of
the reporting unit or asset group in which they reside. In the event any of these assets were to become impaired, we would
recognize an impairment expense equal to the amount by which the carrying value of the reporting unit, impaired asset or asset
group exceeds its estimated fair value.
Fair value measurements of reporting units are estimated using an income approach involving discounted cash flow models that
contain certain Level 3 inputs requiring significant management judgment, including projections of economic conditions,
customer demand and changes in competition, revenue growth rates, gross profit margins, operating margins, capital
expenditures, working capital requirements, terminal growth rates and discount rates. Fair value measurements of the reporting
units associated with our goodwill balances and our indefinite-lived intangible assets are estimated at least annually in the
fourth quarter of each fiscal year for purposes of impairment testing if a quantitative analysis is performed. Fair value
measurements for long-lived assets or asset groups, including intangible assets subject to amortization, property and equipment
and right-of-use lease assets, are valued using undiscounted cash flows to determine whether impairment exists and measure
any impairment loss using discounted cash flows to determine the fair value of long-lived assets.
5.
Property, Plant and Equipment
(In thousands)
March 1, 2025
March 2, 2024
Land
$
3,460 $
3,637
Buildings and improvements
195,205
189,675
Machinery and equipment
428,015
391,236
Computer and office equipment and furniture
61,926
62,586
Construction in progress
49,013
42,099
Total property, plant and equipment
737,619
689,233
Less: accumulated depreciation
469,480
445,017
Net property, plant and equipment
$
268,139 $
244,216
Depreciation expense was $35.7 million, $37.6 million, and $38.2 million in fiscal 2025, 2024, and 2023, respectively.
6.
Goodwill and Other Intangible Assets
Goodwill
Refer to Note 1 for a description of the Accounting Policy related to Goodwill. Goodwill represents the excess of the cost over
the net tangible and identified intangible assets of acquired businesses. We evaluate goodwill for impairment annually as of the
first day of our fiscal fourth quarter, or more frequently if events or changes in circumstances indicate the carrying value of
goodwill may not be recoverable, as described in Note 1. Based on the impairment analysis performed in the fourth quarter,
estimated fair value was in excess of carrying value at all of our reporting units.
The carrying amount of goodwill attributable to each reportable segment was:
(In thousands)
Architectural
Metals
Architectural
Services
Architectural
Glass
Performance
Surfaces
Total
Balance at February 25, 2023
$
90,137 $
3,031 $
25,301 $
10,557 $
129,026
Foreign currency translation
49
7
100
—
156
Balance at March 2, 2024
90,186
3,038
25,401
10,557
129,182
Goodwill acquired
—
—
—
107,826
107,826
Foreign currency translation
(852)
(117)
(264)
—
(1,233)
Balance at March 1, 2025
$
89,334 $
2,921 $
25,137 $
118,383 $
235,775
56
Intangible assets
Indefinite-lived intangible assets
We have intangible assets for certain acquired trade names and trademarks which are determined to have indefinite useful lives.
We test indefinite-lived intangible assets for impairment annually at the same measurement date as goodwill, the first day of our
fiscal fourth quarter, or more frequently if events or changes in circumstances indicate that it is more likely than not that the
asset is impaired as described in Note 1. Based on our annual analysis and changes to our strategic branding in the 4th quarter
of fiscal 2025, we recorded impairment expense of $7.6 million related to trademarks within Selling, general and administrative
expenses (SG&A) in the Architectural Metals Segment.
Definite-lived intangible assets
Long-lived assets or asset groups, including intangible assets subject to amortization and property and equipment, are reviewed
for impairment whenever events or changes in circumstances indicate that the carrying value of those assets may not be
recoverable, as described in Note 1.
In fiscal 2025, $79.7 million of intangible assets were acquired as part of the UW Interco, LLC (UW Solutions) acquisition. The
gross carrying amount of our intangible assets and related accumulated amortization was:
(In thousands)
Gross
Carrying
Amount
Accumulated
Amortization
Impairment
Expense
Foreign
Currency
Translation
Net
March 1, 2025
Definite-lived intangible assets:
Customer relationships
$
134,402 $
(56,193) $
— $
(2,655) $
75,554
Other intangibles
66,832
(31,768)
—
(1,197)
33,867
Total
201,234
(87,961)
—
(3,852)
109,421
Indefinite-lived intangible assets:
Trademarks
26,865
—
(7,634)
(235)
18,996
Total intangible assets
$
228,099 $
(87,961) $
(7,634) $
(4,087) $
128,417
March 2, 2024
Definite-lived intangible assets:
Customer relationships
$
86,798 $
(53,200) $
— $
246 $
33,844
Other intangibles
37,505
(32,250)
—
150
5,405
Total
124,303
(85,450)
—
396
39,249
Indefinite-lived intangible assets:
Trademarks
26,851
—
—
14
26,865
Total intangible assets
$
151,154 $
(85,450) $
— $
410 $
66,114
Amortization expense on finite-lived intangible assets was $8.9 million, $4.9 million and $4.2 million in fiscal 2025, 2024 and
2023, respectively. All amortization expense is included within selling, general and administrative expenses. Estimated future
amortization expense for finite-lived intangible assets is:
(In thousands)
2026
2027
2028
2029
2030
Estimated amortization expense
$
5,236 $
5,236 $
5,184 $
4,968 $
4,928
7.
Debt
On July 19, 2024, we entered into a Credit Agreement (the Credit Agreement) with Bank of America, N.A., as administrative
agent, and other lenders. The Credit Agreement provides for an unsecured senior credit facility in an aggregate principal
amount of up to $700.0 million, in which commitments were made through a $450.0 million, five-year revolving credit facility
and a committed $250.0 million delayed draw term loan facility. Borrowings under the revolving credit facility can be in
Canadian dollars (CAD) limited to $25.0 million USD. The term loan facility may be utilized in up to two draw downs, which
are available to be made within one year after the closing date. The senior credit facility has a term of five years with a maturity
date of July 19, 2029.
The Credit Agreement replaces the previous revolving credit facility with Wells Fargo Bank, N.A., as administrative agent, and
other lenders, with maximum borrowings up to $385.0 million, and the two Canadian credit facilities with Bank of Montreal
totaling $25.0 million USD.
57
As a result of the execution of the Credit Agreement in fiscal 2025, we recognized a loss, within interest expense, of $0.5
million for the write-off of unamortized financing fees related to the previous revolving credit facility. Additionally, we
capitalized $3.0 million of lender fees and $0.8 million of third-party fees incurred in connection with the Credit Agreement,
which were recorded as other non-current assets and will be amortized over the term of the credit facility as interest expense.
The Credit Agreement contains two maintenance financial covenants that require our Consolidated Leverage Ratio (as defined
in the Credit Agreement) to be less than 3.50 and our Consolidated Interest Coverage Ratio (as defined in the Credit
Agreement) to exceed 3.00. At March 1, 2025, we were in compliance with all covenants as defined under the terms of the
Credit Agreement.
The Credit Agreement also contains an acquisition "holiday." In the event we make an acquisition for which the purchase price
is greater than $75 million, we can elect to increase the maximum Consolidated Leverage Ratio (as defined in the Credit
Agreement) to 4.00 for a period of four consecutive fiscal quarters, commencing with the fiscal quarter in which a qualifying
acquisition occurs. No more than two acquisition holidays can occur during the term of the Credit Agreement, and at least two
fiscal quarters must separate qualifying acquisitions.
Borrowings under the Credit Agreement bear floating interest at either the Base Rate or Term Secured Overnight Financing
Rate (SOFR), or, for CAD borrowings, Canadian Overnight Repo Rate Average (CORRA), plus a margin based on the
Consolidated Leverage Ratio (as defined in the Credit Agreement). For Base Rate borrowings, the margin ranges from 0.25% to
0.75%. For Term SOFR and CORRA borrowings, the margin ranges from 1.25% to 1.75%, with an incremental Term SOFR
and CORRA adjustment of 0.10% and 0.29547%.
The Credit Agreement also contains an "accordion" provision. Under this provision, we can request that the senior credit
facility be increased unlimited additional amounts. Any lender may elect or decline to participate in the requested increase at
their sole discretion.
On November 4, 2024, as part of the acquisition of UW Solutions, and for working capital and general corporate purposes, we
executed a drawdown against the delayed draw term loan facility for 250.0 million.
Outstanding borrowings under the term loan facility were $215.0 million as of March 1, 2025. Outstanding borrowings under
the current revolving credit facility were $70.0 million as of March 1, 2025. Outstanding borrowings under the previous
revolving credit facility were $50.0 million as of March 2, 2024. We had no outstanding borrowings under the Canadian
facilities as of March 2, 2024.
At March 2, 2024, debt included $12.0 million of industrial revenue bonds. We had no outstanding industrial revenue bonds as
of March 1, 2025 as in the fourth quarter of fiscal 2025 we paid the remaining balance of these bonds, including principal and
interest outstanding, without penalty.
At March 1, 2025, we had a total of $15.0 million of ongoing letters of credit related to the senior credit facility, amounts that
remained on the industrial revenue bonds that were not extinguished when payment was made, construction contracts and
insurance collateral that expire in fiscal year 2026 and reduce borrowing capacity under the revolving credit facility. As of
March 1, 2025, the amount available for revolving borrowings was $365.0 million.
The fair value of our senior credit facility approximated carrying values at March 1, 2025, and would be classified as Level 2
within the fair value hierarchy described in Note 4, due to the variable interest rates on these instruments.
58
Debt maturities and other selected information follows:
(In thousands)
2026
2027
2028
2029
2030
Thereafter
Total
Maturities
$
— $
— $
— $
— $
285,000 $
— $
285,000
(In thousands, except percentages)
2025
2024
Average daily borrowings during the year
$ 134,565
$ 130,939
Weighted average interest rate during the year
6.28 %
6.03 %
The weighted average interest rates on borrowings outstanding, inclusive of the impact of our interest rate swap as of March 1,
2025 and March 2, 2024 were 4.32% and 4.90%, respectively.
(In thousands)
2025
2024
2023
Interest on debt
$
8,803 $
8,704 $
8,558
Interest rate swap gain
(822)
(893)
(418)
Other interest expense
815
178
294
Interest income
(2,637)
(1,320)
(774)
Interest expense, net
$
6,159 $
6,669 $
7,660
Interest payments were $8.1 million in fiscal 2025, $9.3 million in fiscal 2024 and $8.2 million in fiscal 2023.
59
8.
Leases
We have operating leases for certain buildings and equipment used in our operations. We determine if an arrangement contains
a lease at inception. Under ASU 2016-20, Leases, we have elected the package of practical expedients permitted under the
transition guidance in adopting ASC 842, which, among other things, allowed us to carry forward our historical lease
classification. Operating lease assets and liabilities are recognized at the lease commencement date based on the present value
of lease payments over the lease term. Lease expense is recognized on a straight-line basis over the lease term. Our leases have
remaining lease terms of one to seventeen years, some of which include renewal options that can extend the lease for up to an
additional ten years, at our sole discretion. We have made an accounting policy election not to record leases with an original
term of twelve months or less on our consolidated balance sheet; such leases are expensed on a straight-line basis over the lease
term.
In determining lease asset value, we consider fixed or variable payment terms, prepayments, incentives, and options to extend,
terminate or purchase. Renewal, termination or purchase options affect the lease term used for determining lease asset value
only if the option is reasonably certain to be exercised. We use a discount rate for each lease based upon an estimated
incremental borrowing rate over a similar term. We have elected the practical expedient to account for lease and non-lease
components (e.g., common-area maintenance costs) as a single lease component. Our lease agreements do not contain any
material residual value guarantees or material restrictive covenants.
The components of lease expense were as follows:
(In thousands)
2025
2024
Operating lease cost
$
14,587 $
14,312
Short-term lease cost
688
1,349
Variable lease cost
3,984
2,629
Sublease income
(1,533)
(1,479)
Total lease cost
$
17,726 $
16,811
Other supplemental information related to leases are as follows:
(In thousands)
2025
2024
Cash paid for amounts included in the measurement of operating lease liabilities
$
16,467
$
14,656
Lease assets obtained in exchange for new operating lease liabilities
$
21,810
$
11,883
Weighted-average remaining lease term - operating leases
5.7 years
4.0 years
Weighted-average discount rate - operating leases
4.5 %
3.2 %
Future maturities of lease liabilities are as follows:
(In thousands)
2025
Fiscal 2026
$
17,669
Fiscal 2027
17,123
Fiscal 2028
12,818
Fiscal 2029
7,856
Fiscal 2030
6,615
Thereafter
14,781
Total lease payments
76,862
Less: Amounts representing interest
9,940
Present value of lease liabilities
$
66,922
60
9.
Employee Benefit Plans
401(k) Retirement Plan
We sponsor a single 401(k) retirement plan covering substantially all full-time, non-union employees, as well as union
employees at two of our manufacturing facilities. Under the plan, employees are allowed to contribute up to 60% of eligible
earnings to the plan, up to statutory limits. On January 1, 2023, we began matching 100% of the first two percent contributed
and 50% of the next four percent contributed on eligible compensation that non-union employees contribute. Previously, we
matched 100% of the first one percent contributed and 50% of the next five percent contributed on eligible compensation that
non-union employees contribute. We contribute to the union plans based on the contractual terms. In total, our matching
contributions were $9.1 million in fiscal 2025, $9.6 million in fiscal 2024 and $8.6 million in fiscal 2023.
Deferred Compensation Plan
We maintain a plan that allows participants to defer compensation. The deferred compensation liability was $5.6 million and
$5.9 million at March 1, 2025 and March 2, 2024, respectively. We have investments in corporate-owned life insurance policies
(COLI) of $9.5 million and money market funds (classified as cash equivalents) of $0.3 million with the intention of utilizing
them as long-term funding sources for this plan. The COLI assets are recorded at their net cash surrender values and are
included in other non-current assets in the consolidated balance sheets.
Plans under Collective Bargaining Agreements
We contribute to a number of multi-employer union retirement plans, which provide retirement benefits to the majority of our
union-represented employees; none of the plans are considered significant. However, the risks of participating in these multi-
employer plans are different from single-employer plans in the following aspects:
•
Assets contributed to these plans by one employer may be used to provide benefits to employees of other participating
employers
•
If a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the
remaining participating employers
•
If we choose to stop participating in some of these plans, we may be required to pay those plans an amount based on
the underfunded status of the plan, referred to as a withdrawal liability
Under the Pension Protection Act, multiemployer pension plans are categorized into zones (green, yellow, red, and deep red).
Among other factors, plans in the red zone are generally less than 65% funded, plans in the yellow zone are between 65% and
80% funded, and plans in the green zone are at least 80% funded. The most recent Pension Protection Act zone status available
for fiscals 2025 and 2024 relates to the plan years ending December 31, 2024 and December 31, 2023, respectively.
Our participation in these plans is outlined in the following table.
61
Pension
Protection Act
Zone Status
Contributions
(In thousands)
Pension Fund
EIN/
Pension
Plan
Number
2025
2024
2025
2024
2023
FIP/RP
Status
Pending/
Implemented
(2)
Minimum
Contribution
Surcharge
Imposed
Expiration
Date of
Collective
Bargaining
Agreement(1)
Iron Workers Local
Union No. 5 and Iron
Workers Employers
Association Employees
Pension Trust Fund
521075473
Green
Green
$ 722
$ 1,015
$ 1,359
No
No
No
5/31/2017
International Painters and
Allied Trades Industry
Pension Fund
526073909
Red
Red
730
971
869
Implemented
No
No
11/30/2017
Ironworkers Local 580
Pension Fund
136178514
Green
Green
2,121
883
596
Implemented
No
Yes
6/30/2023
Western Glaziers
Retirement Plan
(Washington)
916123685
Green
Green
365
423
815
No
No
No
6/30/2017
Iron Workers Mid-
America Pension Fund
366488227
Green
Green
320
237
429
No
No
No
5/31/2017
Western Glaziers
Retirement Fund
(Oregon and Southwest
W
hi
t
)
936074376
Green
Green
—
22
441
No
No
No
11/30/2017
Glazier's Union Local 27
Pension and Retirement
Plan
366034076
Green
Green
80
145
174
No
No
No
5/31/2017
Atlanta Ironworkers
Local Union 387 Pension
Plan
586051152
Green
Green
131
109
125
No
No
No
1/31/2017
Other funds
603
801
493
Total contributions
$ 5,072
$ 4,606
$ 5,301
(1) Plans include contributions required by collective bargaining agreements which have expired, but contain provisions automatically renewing their terms in
the absence of a subsequent negotiated agreement.
(2) FIP is defined as Funding Improvement Plan; RP is defined as Rehabilitation Plan
The Company was listed in the plans' Forms 5500 as providing more than 5% of the total contributions for the following plans
and plan years:
Pension Fund
Year contributions to Plan Exceeded More
Than 5 Percent of Total Contributions
Iron Workers Local Union No. 5 and Iron Workers Employers Association Employees Pension Trust Fund
2025, 2024 and 2023
Western Glaziers Retirement Fund (Oregon and Southwest Washington)
2025
Iron Workers Mid-America Pension Fund
2023
Atlanta Ironworkers Local Union 387 Pension Plan
2023
Amounts contributed in fiscal 2025, 2024, and 2023 to defined contribution multiemployer plans were $3.6 million, $2.2
million and $2.2 million, respectively.
Obligations and Funded Status of Defined-Benefit Pension Plans
We sponsor the Tubelite Inc. Hourly Employees' Pension Plan, a defined-benefit pension plan that was frozen to new entrants
in fiscal 2004, with no additional benefits accruing to plan participants after such time. We also sponsor an unfunded
Supplemental Executive Retirement Plan (SERP), a defined-benefit pension plan that was frozen to new entrants in fiscal 2009,
with no additional benefits accruing to plan participants after such time.
62
The following tables present reconciliations of the benefit obligation and the funded status of these plans. The Tubelite plan
uses a measurement date as of the calendar month-end closest to our fiscal year-end, while the SERP uses a measurement date
aligned with our fiscal year-end.
(In thousands)
March 1, 2025
March 2, 2024
Change in projected benefit obligation
Benefit obligation beginning of period
$
8,897 $
10,260
Interest cost
437
497
Actuarial loss (gain)
39
(973)
Benefits paid
(781)
(887)
Benefit obligation at measurement date
8,592
8,897
Change in plan assets
Fair value of plan assets beginning of period
$
3,793 $
3,992
Actual return on plan assets
124
53
Company contributions
446
635
Benefits paid
(781)
(887)
Fair value of plan assets at measurement date
3,582
3,793
Underfunded status
$
(5,010) $
(5,104)
The funded status was recognized in the consolidated balance sheets as follows:
(In thousands)
March 1, 2025
March 2, 2024
Other non-current assets
$
76 $
111
Current liabilities
(446)
(446)
Other non-current liabilities
(4,640)
(4,769)
Total
$
(5,010) $
(5,104)
The following was included in accumulated other comprehensive loss and has not yet been recognized as a component of net
periodic benefit cost:
(In thousands)
2025
2024
Net actuarial loss
$
2,748 $
2,851
The net actuarial gain recognized in comprehensive earnings, net of tax expense, was $0.1 million in fiscal 2025, and $0.9
million in fiscal 2024.
Components of the defined-benefit pension plans' net periodic benefit cost:
(In thousands)
2025
2024
2023
Interest cost
$
437 $
497 $
380
Expected return on assets
(115)
(120)
(84)
Amortization of unrecognized net loss
66
62
254
Net periodic benefit cost
$
388 $
439 $
550
Total net periodic pension benefit cost is expected to be approximately $0.5 million in fiscal 2026. The estimated net actuarial
gain for the defined-benefit pension plans that will be amortized from accumulated other comprehensive loss into net periodic
benefit cost for fiscal 2026 is $0.2 million, net of tax expense.
63
Additional Information
Assumptions
Benefit Obligation Weighted-Average Assumptions
2025
2024
2023
Discount rate
5.10 %
5.15 %
5.10 %
Net Periodic Benefit Expense Weighted-Average Assumptions
2025
2024
2023
Discount rate
5.15 %
5.10 %
3.20 %
Expected long-term rate of return on assets
4.60 %
4.50 %
2.75 %
Discount rate. The discount rate reflects the current rate at which the defined-benefit plans' pension liabilities could be
effectively settled at the end of the year based on the measurement date. The discount rate was determined by matching the
expected benefit payments to payments from the Principal Discount Yield Curve.
Expected return on assets. The expected long-term rate of return on assets is based on historical long-term rates of return
achieved by the plan investments, the plan's investment strategy, and current and projected market conditions. During fiscal
2019, the assets of the Tubelite plan were moved from investment in a short-term bond fund to various duration fixed income
funds. The investments are carried at fair value based on prices from recent trades of similar securities, which would be
classified as Level 2 in the valuation hierarchy. We do not maintain assets intended for the future use of the SERP.
Contributions
Company contributions to the plans for fiscal 2025 were $0.4 million and fiscal 2024 were $0.6 million, which equaled or
exceeded the minimum funding requirements.
Estimated Future Benefit Payments
The following benefit payments, which reflect expected future service, are expected to be paid by the plans:
(In thousands)
2026
2027
2028
2029
2030
2031-2035
Estimated future benefit payments
$
816 $
784 $
782 $
770 $
746 $
3,416
10. Commitments and Contingent Liabilities
Bond commitments
In the ordinary course of business, predominantly in the Architectural Services and Architectural Metals Segments, we are
required to provide surety or performance bonds that commit payments to our customers for any non-performance. At March 1,
2025, $1.2 billion of these types of bonds were outstanding, of which, $394.1 million is on our backlog. These bonds have
expiration dates that align with completion of the purchase order or contract. We have never been required to make payments
under surety or performance bonds with respect to our existing businesses.
Warranty and project-related contingencies
We reserve estimated exposures on known claims, as well as on a portion of anticipated claims, for product warranty and
rework costs, based on historical product liability claims as a ratio of sales. Claim costs are deducted from the accrual when
paid. Factors that could have an impact on the warranty accrual in any given period include the following: changes in
manufacturing quality, changes in product mix, and any significant changes in sales volume.
(In thousands)
2025
2024
Balance at beginning of period
$
21,362 $
17,893
Additional accruals
7,336
15,775
Claims paid
(10,237)
(12,306)
Balance at end of period
$
18,461 $
21,362
Additionally, we are subject to project management and installation-related contingencies as a result of our fixed-price material
supply and installation service contracts, primarily in our Architectural Services Segment and certain of our Architectural
Metals businesses. We manage the risk of these exposures through contract negotiations, proactive project management and
insurance coverages.
64
Letters of credit
At March 1, 2025, we had $15.0 million of ongoing letters of credit, all of which have been issued under our revolving credit
facility, as discussed in Note 7.
Purchase obligations
Purchase obligations for raw material commitments and capital expenditures totaled $10.2 million as of March 1, 2025.
Environmental liability
In fiscal 2008, we acquired one manufacturing facility which has certain historical environmental conditions. Remediation of
these conditions is ongoing without significant disruption to our operations. The estimated remaining liability for these
remediation activities was $0.1 million and $0.4 million at March 1, 2025 and March 2, 2024, respectively.
New Markets Tax Credit (NMTC) transactions
We have two outstanding NMTC arrangements which help to support operational expansion. Proceeds received from investors
on these transactions are included within other current liabilities on our consolidated balance sheets. The NMTC arrangements
are subject to 100% tax credit recapture for a period of seven years from the date of each respective transaction. Upon the
termination of each arrangement, these proceeds will be recognized in earnings in exchange for the transfer of tax credits. The
direct and incremental costs incurred in structuring these arrangements have been deferred and are included in other current
assets on our consolidated balance sheets. These costs will be recognized in conjunction with the recognition of the related
proceeds on each arrangement. During the construction phase or for working capital purposes for each project, we are required
to hold cash dedicated to fund each capital project which is classified as restricted cash on our consolidated balance sheets.
Variable-interest entities, which have been included within our consolidated financial statements, have been created as a result
of the structure of these transactions, as investors in the programs do not have a material interest in their underlying economics.
During fiscal 2024, one NMTC transaction was settled as expected and resulted in a $4.7 million benefit, which was recorded in
other (income) expense, net.
The table below provides a summary of our outstanding NMTC transactions (in thousands):
Inception date
Termination date
Proceeds received
Deferred costs
Net benefit
May 2022(1)
August 2025
$
6,052 $
1,891 $
4,161
September 2018
September 2025
3,198
1,031
2,167
Total
$
9,250 $
2,922 $
6,328
(1) Continuation of the August 2018 NMTC financing transaction
Litigation
The Company is a party to various legal proceedings incidental to its normal operating activities. In particular, like others in the
construction supply and services industry, the Company is routinely involved in various disputes and claims arising out of
construction projects, sometimes involving significant monetary damages or product replacement. We have in the past and are
currently subject to product liability and warranty claims, including certain legal claims related to a commercial sealant product
formerly incorporated into our products.
In December 2022, the claimant in an arbitration of one such claim was awarded $20 million by an arbitration panel. The
claimant then sought to confirm this award in Los Angeles Superior Court in March 2023. In response, the Company moved to
vacate the award. Later in March 2023, the Superior Court confirmed the award, which the Company appealed in June 2023.
The appeal was argued before the California Court of Appeals, Second Appellate District, Division Seven, on March 7, 2025.
The California Court of Appeals confirmed the judgment of the Superior Court on March 25, 2025. The Company paid the final
arbitration award, including accrued post-judgment interest, in the amount of $24.7 million, on April 7, 2025. As a result of the
judgment, we recorded expense of $9.4 million, which represents the impact of the award amount net of existing reserves and
estimated insurance proceeds. This impact was recorded in cost of goods sold in the fourth quarter of fiscal 2025.
The Company is also subject to litigation arising out of areas such as employment practices, workers compensation and general
liability matters. Although it is very difficult to accurately predict the outcome of any such proceedings, facts currently
available indicate that no matters will result in losses that would have a material adverse effect on the results of operations, cash
flows or financial condition of the Company.
65
11. Supplier Finance Program Obligations
The Company has a supplier financing arrangement that enables select suppliers, at their sole discretion, to sell our receivables
(i.e., our payment obligations to the suppliers) on a non-recourse basis in order to be paid earlier than our payment terms
provide. These suppliers’ voluntary inclusion of invoices in the supplier financing arrangement has no bearing on our payment
terms, the amounts we pay, or our liquidity. We have no economic interest in the supplier’s decision to participate in the
supplier financing program, and we do not provide any guarantees in connection with it. The balances owed are reflected in
accounts payable in the consolidated balance sheets and are reflected in net cash provided by operating activities in our
consolidated statements of cash flows when settled.
The following table summarizes the obligation activity for the years ended March 1, 2025 and March 2, 2024 and outstanding
balance as of March 1, 2025 and March 2, 2024 that we have confirmed as valid to the administrators of our program:
(In thousands)
2025
2024
Balance at beginning of period
$
6,527 $
—
Obligations added to the program
47,226
33,133
Obligations settled
(46,907)
(26,606)
Balance at end of period
$
6,846 $
6,527
66
12. Shareholders' Equity
We paid dividends totaling $21.7 million ($1.01 per share) in fiscal 2025, $21.1 million ($0.97 per share) in fiscal 2024 and
$19.7 million ($0.90 per share) in fiscal 2023.
Share Repurchases
During fiscal 2004, the Board of Directors authorized a share repurchase program, with subsequent increases in authorization.
We repurchased 786,690 shares under the program during fiscal 2025, for a total cost of $45.4 million. We repurchased 279,916
shares under the program, for a total cost of $11.8 million, in fiscal 2024, and repurchased 1,571,139 shares under the program,
for a total cost of $74.3 million, in fiscal 2023. We have repurchased a total of 12,063,207 shares, at a total cost of $438.5
million, since the inception of this program. On October 6, 2023, the Board of Directors increased the share repurchase
authorization by 2 million shares. We have remaining authority to repurchase 2,186,793 shares under this program, which has
no expiration date.
In addition to the shares repurchased under this repurchase plan, during fiscal 2025, 2024 and 2023, the Company also withheld
$6.1 million, $2.5 million and $2.3 million, respectively, of Company stock from employees in order to satisfy stock-for-stock
option exercises or tax obligations related to stock-based compensation, pursuant to terms of Board and shareholder-approved
compensation plans.
Accumulated Other Comprehensive Loss
The following summarizes the accumulated other comprehensive loss, net of tax, at March 1, 2025 and March 2, 2024:
(In thousands)
2025
2024
Net unrealized loss on marketable securities
$
(149) $
(328)
Net unrealized gain on derivative instruments
—
440
Pension liability adjustments
(2,106)
(2,187)
Foreign currency translation adjustments
(33,037)
(27,456)
Total accumulated other comprehensive loss
$
(35,292) $
(29,531)
13. Share-Based Compensation
We have a 2019 Stock Incentive Plan and a 2019 Non-Employee Director Stock Plan (the Plans) that provide for the issuance
of 1,150,000 and 300,000 shares, respectively, for various forms of stock-based compensation to employees and non-employee
directors. Awards under these Plans may be in the form of incentive stock options (to employees only), non-statutory options,
stock-settled stock appreciation rights (SARs), or nonvested share awards and units, all of which are granted at a price or with
an exercise price equal to the fair market value of the Company’s stock at the date of award. We also have 2009 Non-Employee
Director Stock Incentive Plan under which deferred restricted stock units were allocated, in addition to deferred restricted stock
units acquired pursuant to a dividend equivalent reinvestment feature. As of June 23, 2019, no additional awards can be made
under the 2009 Non-Employee Director Stock Incentive Plan.
We recorded share-based compensation expense, in which we account for any forfeitures as they occur, as follows:
(In thousands)
2025
2024
2023
Restricted stock awards and restricted stock units
$
8,040 $
6,753 $
5,607
Performance share units
2,685
2,714
2,389
Stock options
—
254
660
Share-based compensation expense
10,725
9,721
8,656
Stock Options
For fiscal 2024, there were no cash proceeds from the exercise of stock options as all stock options were exercised on a stock-
for-stock basis. The aggregate intrinsic value of securities exercised (the amount by which the stock price on the date of
exercise exceeded the stock price of the award on the date of grant) was $1.8 million.
Service Condition Awards
Nonvested share awards and units generally vest over a two, three or four-year period. The following table summarizes
nonvested restricted stock awards and restricted stock units activity for fiscal 2025:
67
Number of Shares
and Units
Weighted Average
Grant Date Fair Value
Awards outstanding at March 2, 2024
384,461 $
40.28
Granted
137,227
63.59
Vested
(160,028)
42.67
Forfeited and cancelled
(13,441)
51.37
Awards outstanding at March 1, 2025
348,219 $
48.53
Performance Condition Awards
In fiscal 2022, the Compensation Committee of the Board of Directors implemented an executive compensation program for
certain key employees. In each of the first quarters of fiscal 2025, fiscal 2024 and fiscal 2023, we issued performance shares in
the form of nonvested share unit awards, which give the recipient the right to receive shares earned at the end of the respective
three-fiscal-year performance period. The number of share units issued at grant is equal to the target number of performance
shares and allows for the right to receive a variable number of shares, ranging from 0% to 200% of target, dependent on
achieving defined performance goals and being employed at the end of the performance period.
The following table summarizes nonvested performance share units granted and outstanding for which plans are at 100% to
200% of target:
Number of Shares
and Units
Weighted Average
Grant Date Fair Value
Awards outstanding at March 2, 2024
115,104 $
41.89
Granted (1)
76,914
48.37
Vested (1)
(79,526)
34.90
Forfeited and cancelled
(11,372)
52.46
Awards outstanding at March 1, 2025
101,120 $
51.13
(1)
Includes 39,763 shares for performance goals component of the fiscal 2022-2024 performance period.
At March 1, 2025, there was $11.8 million of total unrecognized compensation cost related to nonvested share and nonvested
share unit awards, which is expected to be recognized over a weighted average period of approximately 21 months. The total
fair value of shares vested during fiscal 2025 was $10.0 million.
14. Income Taxes
Earnings before income taxes consisted of the following:
(In thousands)
2025
2024
2023
United States
$
111,029 $
133,185 $
126,859
International
1,545
(3,932)
(10,238)
Earnings before income taxes
$
112,574 $
129,253 $
116,621
68
The components of income tax (benefit) expense for each of the last three fiscal years are as follows:
Current
Federal
$
19,979 $
32,900 $
9,621
State and local
3,546
6,172
7,670
International
(586)
286
231
Total current
22,939
39,358
17,522
Deferred
Federal
3,190
(8,361)
(5,120)
State and local
691
(1,387)
(2,487)
International
(45)
—
422
Total deferred
3,836
(9,748)
(7,185)
Total non-current tax expense
747
30
2,177
Total income tax expense
$
27,522 $
29,640 $
12,514
(In thousands)
2025
2024
2023
Income tax payments, net of refunds, were $29.6 million, $33.0 million and $27.4 million in fiscal 2025, 2024 and 2023,
respectively.
The following table provides a reconciliation of the statutory federal income tax rate to our consolidated effective tax rates:
2025
2024
2023
Statutory federal income tax rate
21.0 %
21.0 %
21.0 %
State and local income taxes, net of federal tax benefit
2.9
2.4
3.5
Foreign tax rate differential
(0.8)
(0.2)
(0.2)
Valuation allowance
(0.3)
1.0
(4.7)
Nontaxable (loss) gain on life insurance policies
(0.2)
—
0.2
Deduction for foreign derived intangible income
(0.4)
(0.3)
(0.2)
Research & development tax credit
(1.5)
(1.3)
(1.5)
§162(m) Executive Compensation Limitation
3.4
0.8
0.8
Tax benefit of share based awards
(1.0)
(0.6)
(0.8)
Worthless stock deduction
—
—
(6.0)
Other, net
1.3
0.1
(1.4)
Consolidated effective income tax rate
24.4 %
22.9 %
10.7 %
The effective tax rate for fiscal 2025 increased 1.5 percentage points from fiscal 2024, primarily due to an increase in taxes for
nondeductible executive compensation in fiscal 2025. The effective tax rate for fiscal 2024 increased 12.2 percentage points
from fiscal 2023, primarily due to the impact of discrete items in fiscal 2023.
69
Deferred tax assets and deferred tax liabilities at March 1, 2025 and March 2, 2024 were:
Deferred tax assets
Accrued expenses
$
3,743 $
4,565
Deferred compensation
9,794
11,138
Section 174 capitalized costs
15,675
12,450
Goodwill and other intangibles
3,127
2,342
Liability for unrecognized tax benefits
2,651
2,122
Unearned income
—
7,467
Operating lease liabilities
14,898
13,064
Net operating losses and tax credits
11,679
12,332
Other
4,665
4,773
Total deferred tax assets
66,232
70,253
Less: valuation allowance
(9,582)
(10,803)
Deferred tax assets, net of valuation allowance
56,650
59,450
Deferred tax liabilities
Depreciation
22,401
20,510
Operating lease, right-of-use assets
13,605
11,955
Bad debt
7,785
8,291
Prepaid expenses
1,697
2,131
Other
3,923
2,520
Total deferred tax liabilities
49,411
45,407
Net deferred tax assets (liabilities)
$
7,239 $
14,043
(In thousands)
2025
2024
The Company has state and foreign net operating loss carryforwards with a tax effect of $11.7 million. A valuation allowance
of $8.7 million has been established for these net operating loss carryforwards due to the uncertainty of the use of the tax
benefits in future periods.
Management assesses the available positive and negative evidence to estimate whether sufficient future taxable income will be
generated to permit use of the existing Deferred Tax Assets. This has resulted in valuation allowances being recorded against
Deferred Tax Assets in prior years in Brazil, Canada and various states.
The Company files income tax returns in the U.S. federal jurisdiction, various U.S. state jurisdictions, Canada, Brazil and other
international jurisdictions. The Company is no longer subject to U.S. federal tax examinations or state and local tax
examinations for years prior to fiscal 2022, or state and local tax examinations for years prior to fiscal 2021. The Company is
not currently under U.S. federal examination for years subsequent to fiscal 2021.
The Company considers the earnings of its non-U.S. subsidiaries to be indefinitely invested outside of the United States on the
basis of estimates that future domestic cash generation will be sufficient to meet future domestic cash needs and specific plans
for reinvestment of those subsidiary earnings. Should the Company decide to repatriate the foreign earnings, it would need to
adjust the income tax provision in the period it was determined that the earnings will no longer be indefinitely invested outside
the U.S.
If we were to prevail on all unrecognized tax benefits recorded, $3.8 million, $3.3 million and $3.8 million for fiscal 2025, 2024
and 2023, respectively, would benefit the effective tax rate. Also included in the balance of unrecognized tax benefits for fiscal
2025, 2024 and 2023 are $2.2 million, $1.8 million, and $1.5 million, respectively, of tax benefits that, if recognized, would
result in decreases to deferred taxes.
Penalties and interest related to unrecognized tax benefits are recorded in income tax expense. For fiscal 2025, 2024 and 2023,
we accrued penalties and interest related to unrecognized tax benefits of $1.0 million, $0.6 million, and $0.4 million,
respectively.
70
The following table provides a reconciliation of the total amounts of gross unrecognized tax benefits:
(In thousands)
2025
2024
2023
Gross unrecognized tax benefits at beginning of year
$
5,053 $
5,312 $
3,321
Gross increases in tax positions for prior years
347
91
2,298
Gross decreases in tax positions for prior years
(11)
(65)
(255)
Gross increases based on tax positions related to the current year
886
579
291
Gross decreases based on tax positions related to the current year
—
—
(27)
Settlements
—
(354)
—
Statute of limitations expiration
(308)
(510)
(316)
Gross unrecognized tax benefits at end of year
$
5,967 $
5,053 $
5,312
In December 2021, the OECD issued model rules for a new global minimum tax framework (“Pillar Two”), and various
governments around the world have issued, or are in the process of issuing, legislation to implement these rules. The Company
is within the scope of the OECD Pillar Two model rules and has assessed the impact thereof. Based on available legislation, we
concluded there was no material impact on income taxes with respect to Pillar Two for the year ended March 1, 2025. We will
continue to evaluate the potential future impacts and will monitor and review the issuance of additional guidance.
15. Earnings per Share
Basic earnings per share is computed by dividing net earnings by the weighted average number of common shares outstanding.
Diluted earnings per share is computed by dividing net earnings by the weighted average number of common shares
outstanding, including the dilutive effects of stock options, SARs and nonvested shares. The following table presents a
reconciliation of the share amounts used in the computation of basic and diluted earnings per share:
(In thousands)
2025
2024
2023
Basic earnings per share - weighted average common shares outstanding
21,726
21,871
22,007
Weighted average effect of nonvested share grants and assumed exercise of stock options
165
220
409
Diluted earnings per share - weighted average common shares and potential common shares
outstanding
21,891
22,091
22,416
Stock awards excluded from the calculation of earnings per share because the award price was
greater than the average market price of the common shares
23
31
97
16. Business Segment Data
We have four operating segments which are also reportable segments. Each of our four segments have distinct economic
characteristics, including products and services provided, production processes and varying ranges in performance and results:
•
The Architectural Metals Segment designs, engineers, fabricates and finishes aluminum window, curtainwall, storefront
and entrance systems used primarily in non-residential construction.
•
The Architectural Services Segment integrates technical services, project management, and field installation services to
design, engineer, fabricate, and install architectural curtainwall and other façade-related systems primarily in non-
residential construction.
•
The Architectural Glass Segment cuts, treats, coats and fabricates high-performance glass used in custom window and
wall systems primarily for non-residential buildings.
•
The Performance Surfaces Segment develops and manufactures high-performance coated materials for a variety of
applications, including wall decor, museums, graphic design, digital displays, architectural interiors, and industrial
flooring.
The Company’s CEO is the chief operating decision maker (CODM). The CODM utilizes net sales and adjusted earnings
before interest and taxes (EBIT) to assess segment performance and make decisions about the allocation of operating and
capital resources by analyzing recent results, trends, and variances of each segment in relation to forecasts and historical
performance.
Net sales, adjusted cost of sales, adjusted SG&A, adjusted other income (expense), and the resulting adjusted EBIT for each of
the Company’s four reportable segments are presented below. Segment net sales is defined as net sales for a certain segment
and includes revenue related to intersegment transactions. We report net sales intersegment eliminations separately to exclude
these sales from our consolidated total. Segment EBIT includes intersegment sales transactions and excludes certain corporate
costs that are not allocated at a segment level. We report these unallocated corporate costs in Corporate and Other.
71
52-Weeks Ended March 1, 2025
Net sales to external customers
$
524,617 $
419,861 $
294,385 $
122,131 $ 1,360,994
Intersegment net sales
92
—
27,812
—
27,904
524,709
419,861
322,197
122,131
1,388,898
Adjusted cost of sales (1)
(373,902)
(344,702)
(220,636)
(76,487) (1,015,727)
Adjusted SG&A (2)
(96,687)
(45,604)
(42,287)
(21,505)
(206,083)
Adjusted other income (expense), net (3)
—
—
115
—
115
Adjusted EBIT
$
54,120 $
29,555 $
59,389 $
24,139 $
167,203
53-Weeks Ended March 2, 2024
Net sales to external customers
$
598,248 $
377,443 $
342,028 $
99,223 $ 1,416,942
Intersegment net sales
3,488
979
36,421
—
40,888
601,736
378,422
378,449
99,223
1,457,830
Adjusted cost of sales (1)
(425,424)
(323,761)
(267,469)
(60,636) (1,077,290)
Adjusted SG&A (2)
(105,509)
(40,295)
(42,934)
(14,354)
(203,092)
Adjusted other income (expense), net (3)
—
—
(2,263)
—
(2,263)
Adjusted EBIT
$
70,803 $
14,366 $
65,783 $
24,233 $
175,185
52-Weeks Ended February 25, 2023
Net sales to external customers
$
647,949 $
408,566 $
279,966 $
104,215 $ 1,440,696
Intersegment net sales
1,829
2,061
36,588
—
40,478
649,778
410,627
316,554
104,215
1,481,174
Adjusted cost of sales (1)
(463,902)
(352,372)
(247,073)
(64,565) (1,127,912)
Adjusted SG&A (2)
(104,002)
(40,115)
(40,872)
(14,303)
(199,292)
Adjusted other income (expense), net (3)
—
—
(47)
—
(47)
Adjusted EBIT
$
81,874 $
18,140 $
28,562 $
25,347 $
153,923
(In thousands)
Architectural
Metals
Architectural
Services
Architectural
Glass
Performance
Surfaces
Total
(1)
Adjusted cost of sales excludes $4.2 million and $5.5 million of adjustments related to acquisition and restructuring
costs as described in more detail within the reconciliation presented below, respectively, for the years ended March 1,
2025 and March 2, 2024.
(2)
Adjusted SG&A expenses excludes $11.5 million and $3.0 million of adjustments related to acquisition and
restructuring costs and impairment expense as described in more detail within the reconciliation presented below,
respectively, for the years ended March 1, 2025 and March 2, 2024.
(3)
Adjusted Other (income) expense, net excludes $4.7 million of NMTC benefit recorded for the year ended March 2,
2024 as described in more detail within the reconciliation presented below.
The following table presents the reconciliation of adjusted EBIT to income before income taxes, the nearest measurement under
GAAP:
(In thousands)
2025
2024
2023
Segment Adjusted EBIT
$
167,203 $
175,185 $
153,923
Corporate and Other expenses
(32,772)
(35,454)
(29,642)
Segment acquisition-related costs (1)
(4,529)
—
—
Segment restructuring costs (2)
(3,535)
(8,496)
—
Impairment expense (3)
(7,634)
—
—
NMTC settlement gain (4)
—
4,687
—
Interest expense, net
(6,159)
(6,669)
(7,660)
Earnings before income taxes
$
112,574 $
129,253 $
116,621
72
(1)
Segment acquisition-related costs include:
• Transaction costs related to the UW Solutions acquisition.
• Integration costs related to one-time expenses incurred to integrate the UW Solutions acquisition.
• Backlog amortization is related the value attributed to contracting the backlog purchased in the UW Solutions
acquisition. These costs were amortized in SG&A over the period that the contracted backlog was shipped.
• Inventory step-up is related to the incremental cost to value inventory acquired as part of the UW Solutions
acquisition at fair value. These costs were expensed to cost of goods sold over the period the inventory was sold.
(2)
Segment restructuring charges related to Project Fortify. Refer to Note 18.
(3)
Impairment expense on intangible assets in the Architectural Metals Segment. Refer to Note 6.
(4)
Realization of a NMTC benefit which was recorded in other income (expense), net. Refer to Note 10.
The following table presents the capital expenditures, depreciation and amortization and identifiable assets by reportable
segments and the reconciliation to amounts reported for GAAP:
(In thousands)
Architectural
Metals
Architectural
Services
Architectural
Glass
Performance
Surfaces
Corporate
and Other
Total
Fiscal 2025
Capital expenditures
$
3,333 $
7,522 $
13,782 $
9,479 $
1,477 $
35,593
Depreciation and amortization
16,471
3,978
12,274
9,085
2,800
44,608
Identifiable assets
343,553
179,311
213,067
345,034
94,304
1,175,269
Fiscal 2024
Capital expenditures
$
4,733 $
3,166 $
12,142 $
16,896 $
6,243 $
43,180
Depreciation and amortization
19,226
4,011
11,955
3,040
3,356
41,588
Identifiable assets
363,512
131,651
208,651
83,731
96,519
884,064
Fiscal 2023
Capital expenditures
$
11,432 $
3,683 $
5,613 $
13,474 $
10,975 $
45,177
Depreciation and amortization
19,386
3,953
11,964
3,088
4,012
42,403
Identifiable assets
426,946
141,840
207,730
69,035
69,814
915,365
The following table presents net sales, based on the location in which the sale originated, and long-lived assets, representing
property, plant and equipment, net of related depreciation, by geographic region.
(In thousands)
2025
2024
2023
Net Sales
United States
$
1,258,887 $
1,295,436 $
1,301,168
Canada
85,417
101,055
120,565
Brazil
16,690
20,451
18,963
Total
$
1,360,994 $
1,416,942 $
1,440,696
(In thousands)
March 1, 2025
March 2, 2024
February 25, 2023
Long-Lived Assets
United States
$
261,457 $
235,398 $
239,847
Canada
4,984
6,345
6,330
Brazil
1,698
2,473
2,690
Total
$
268,139 $
244,216 $
248,867
Our export net sales from U.S. operations were $54.1 million, $47.6 million and $56.2 million in fiscal 2025, 2024 and 2023,
respectively, representing approximately 4%, 3% and 4% of consolidated net sales in each of these fiscal years, respectively.
Due to the varying combinations and integration of individual window, storefront and curtainwall systems, it is impractical to
report product revenues generated by class of product beyond the segment revenues currently reported.
73
17. Acquisitions
On November 4, 2024, we completed the acquisition of UW Solutions for $240.9 million in cash. UW Solutions is a U.S.
based, vertically integrated manufacturer of high-performance coated substrates with a portfolio of well-known brands,
including ResinDEK, ChromaLuxe, RDC Coatings, and Unisub, each known as a leader in its specified applications. The UW
Solutions business activity is included in our Performance Surfaces Segment.
The total purchase consideration was $232.2 million in cash, net of a favorable net working capital adjustment of $0.9 million
and cash acquired of $8.7 million. The acquisition was funded with cash on hand and borrowings under our existing credit
agreement. During fiscal 2025, we incurred pre-tax acquisition-related expenses of $10.3 million associated with the UW
Solutions acquisition. We incurred $1.5 million for inventory step-up expense and $0.2 million of transaction costs which were
included in costs of sales as well as $4.2 million of transaction costs, $2.1 million of integration costs, and $2.3 million of
amortization of acquired backlog, which were included in SG&A within our consolidated results of operations.
We accounted for the acquisition as a purchase of a business and recorded the excess of the purchase price over the estimated
fair value of the assets acquired and liabilities assumed as goodwill of $107.8 million. The goodwill recognized is attributable
primarily to expected synergies by integrating UW Solutions into our Performance Surfaces Segment and by creating a scalable
growth platform in the specialty coatings and materials market. The acquired goodwill is expected to be amortized and
deductible for income tax purposes. We have provisionally determined the appropriate fair values of the acquired intangible
assets and completed our analysis of the economic lives of the assets acquired. We assigned $21.0 million to a tradename asset
and are amortizing it over a 15-year expected life. We assigned $2.3 million to a contract backlog asset and amortized it over a
4-month life. We assigned $47.4 million to a customer relationship asset and are amortizing a portion over a 10-year expected
life and the remainder over a 15-year expected life, based on historical customer attrition rates. We assigned $7.8 million to a
developed technology asset and are amortizing over a 7.5-year expected life.
The following table presents the estimated fair values of assets acquired and liabilities assumed at the acquisition date:
(In thousands)
Assets:
Cash and cash equivalents
$
8,703
Receivables, net
12,427
Inventories, net
17,903
Other current assets
1,122
Property, plant and equipment
26,563
Operating lease right-of-use assets
14,189
Goodwill
107,826
Intangible assets, net
79,679
Other non-current assets
166
Total Assets
$
268,578
Liabilities:
Accounts payable
5,126
Accrued compensation and benefits
6,900
Operating lease liabilities
1,259
Other current liabilities
1,490
Non-current operating lease liabilities
12,930
Total Liabilities
$
27,705
Net assets recorded
$
240,873
The impact of the acquisition of UW Solutions on our consolidated results of operations for fiscal 2025 was $32.0 million of net
sales and $7.4 million of net loss, respectively. The net sales and net loss represent approximately 17 weeks of operating results.
The following supplemental unaudited pro forma information presents our financial results as if the acquisition of UW
Solutions had occurred on February 26, 2023. This supplemental pro forma information has been prepared for comparative
purposes and would not necessarily indicate what may have occurred if the acquisition had been completed on February 26,
2023, and this information is not intended to be indicative of future results.
74
(in thousands, except earnings per share data)
(Unaudited)
2025
2024
Net sales
$ 1,423,635 $ 1,513,734
Net earnings
90,978
83,256
Earnings per share:
Basic
$
4.19 $
3.81
Diluted
$
4.16 $
3.77
Nonrecurring charges of $4.4 million of transaction costs, $2.1 million of integration costs, $2.3 million of amortization of
acquired backlog, and $1.5 million of inventory step-up expense incurred in fiscal 2025 are reflected as if those charges were
incurred in the first and second quarters of the fiscal 2024 supplemental pro forma earnings.
These amounts have been calculated after applying our accounting policies and adjusting the results of UW Solutions to reflect
the effect of definite-lived intangible assets recognized as part of the business combination on amortization expense as if the
acquisition had occurred on February 26, 2023.
18. Restructuring
During the fourth quarter of fiscal 2024, we announced strategic actions to streamline our business operations, enable a more
efficient cost model, and better position the Company for profitable growth (referred to as “Project Fortify”). Project Fortify
primarily impacted the Architectural Metals Segment and included:
•
Eliminating certain lower-margin product and service offerings, enabling consolidation into a single operating entity.
•
Transferring production operations from the Company’s facility in Walker, Michigan, to the Company’s facilities in
Monett, Missouri and Wausau, Wisconsin.
•
Simplifying the segment’s brand portfolio and commercial model to improve flexibility, better leverage the
Company’s capabilities, and enhance customer service.
Additionally, the Company implemented actions to optimize processes and streamline resources in its Architectural Services
and Corporate and Other.
During fiscal 2025, we incurred $4.3 million of pre-tax costs associated with Project Fortify, of which $2.5 million is included
in cost of sales and $1.8 million is included within SG&A expenses. During fiscal 2024, we incurred $12.4 million of pre-tax
costs associated with Project Fortify, of which $5.5 million is included within cost of sales and $6.9 million is included within
SG&A expenses. The Company completed Project Fortify during the fourth quarter of fiscal 2025 and incurred at total of
$16.7 million of restructuring changes, which included:
•
$7.0 million of severance and employee related costs;
•
$1.7 million contract termination costs: and
•
$8.0 million of other expenses.
These actions have led to estimated annualized pre-tax cost savings of approximately $14 million.
75
(In thousands)
Architectural
Metals
Architectural
Services
Architectural
Glass
Corporate &
Other
Total
March 1, 2025
Termination benefits
$
928 $
(640) $
— $
788 $
1,076
Contract termination costs
—
—
—
—
—
Other restructuring charges
3,096
151
—
—
3,247
Total restructuring charges
$
4,024 $
(489) $
— $
788 $
4,323
March 2, 2024
Termination benefits
3,348
2,475
—
56
5,879
Contract termination costs
1,568
49
—
—
1,617
Other restructuring charges
1,054
2
—
3,851
4,907
Total restructuring charges
$
5,970 $
2,526 $
— $
3,907 $
12,403
February 25, 2023
Termination benefits
—
—
116
—
116
Total restructuring charges
$
— $
— $
116 $
— $
116
The following table summarizes our restructuring related accrual balances included within accrued payroll and related benefits
and other current liabilities in the consolidated balance sheets. All remaining accrual balances are expected to be paid within
fiscal 2026.
(In thousands)
Architectural
Metals
Architectural
Services
Architectural
Glass
Corporate &
Other
Total
Balance at February 25, 2023
$
62 $
— $
23 $
— $
85
Restructuring expense
3,985
2,477
—
56
6,518
Payments
(1,233)
(410)
(23)
—
(1,666)
Balance at March 2, 2024
$
2,814 $
2,067 $
— $
56 $
4,937
Restructuring expense
1,931
(812)
—
778
1,897
Payments
(4,256)
(605)
—
(323)
(5,184)
Other adjustments
797
—
—
—
797
Balance at March 1, 2025
$
1,286 $
650 $
— $
511 $
2,447
The charges presented in the rollforward of our restructuring accruals do not include items charged directly to expense as
incurred, as those items are not reflected in accrued payroll and related benefits and other current liabilities in the consolidated
balance sheets.
On April 23, 2025, we announced a second phase of Project Fortify to drive further cost efficiencies, primarily in the
Architectural Metals and Architectural Services Segments. Phase 2 will focus on further optimizing our operating footprint and
aligning resources to enable a more effective operating model. We expect the actions of Phase 2 to incur approximately
$24 million to $26 million of pre-tax charges, of which approximately $8 million are expected to be non-cash charges. The
charges include the following:
•
$9 million to $10 million of severance and employee related costs;
•
$2 million to $3 million of contract termination costs; and
•
$12 million to $13 million of other expenses.
The Company expects the actions associated with Phase 2 to be substantially completed by the end of the fourth quarter of
fiscal 2026 and expects them to deliver annualized pre-tax cost savings from Phase 2 of approximately $13 million to $15
million.
During fiscal 2022, we announced plans to realign and simplify our business structure, which resulted in the closure of two
facilities within the Architectural Glass Segment, in Dallas, Texas and Statesboro, Georgia. These closures were made in order
to concentrate this segment on premium, high-performance products. Additionally, employee termination costs were incurred
related to these facility closures, realignment of the Architectural Metals Segment, and within the Corporate office.
76
During the first quarter of fiscal 2023, we completed the execution of these plans with the sale of the remaining manufacturing
assets at our Architectural Glass location, in Dallas, Texas, for $4.1 million. The remaining assets had a carrying value of $3.4
million, and we recognized a gain on the sale of approximately $0.6 million, net of associated transaction costs, which is
included as a reduction of cost of sales within our consolidated statements of operations.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
None.
77
ITEM 9A.CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures. As of the end of the period covered by this report (the Evaluation Date), we
carried out an evaluation, under the supervision and with the participation of management, including the Chief Executive
Officer and the Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and
procedures (as defined in Rules 13a-15(e) or 15d-15(e) of the Exchange Act). Based upon that evaluation, the Chief Executive
Officer and Chief Financial Officer concluded that, as of the Evaluation Date, our disclosure controls and procedures were
effective to ensure that information required to be disclosed by the Company in the reports that it files or submits under the
Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in applicable rules and
forms, and (ii) accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial
Officer, to allow timely decisions regarding required disclosure.
Management's Annual Report on Internal Control Over Financial Reporting. The report of management required under this
Item 9A is contained on page 32 in Item 8 of this Annual Report on Form 10-K under the caption “Management's Annual
Report on Internal Control Over Financial Reporting.”
Attestation Report of Independent Registered Public Accounting Firm. The attestation report required under this Item 9A is
contained on page 33 in Item 8 of this Annual Report on Form 10-K under the caption “Report of Independent Registered
Public Accounting Firm.”
Changes in Internal Control over Financial Reporting. There have not been any changes in our internal control over financial
reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the most recent fiscal
quarter covered by this report that would have materially affected, or are reasonably likely to materially affect, the Company's
internal control over financial reporting.
ITEM 9B. OTHER INFORMATION
Insider Adoption or Termination of Trading Arrangements
During the fiscal quarter ended March 1, 2025, none of our directors or officers (as defined in Rule 16a-1(f) of the Exchange
Act) adopted or terminated any "Rule 10b5-1 trading arrangement" or any "non-Rule 10b5-1 trading arrangement", as each term
is defined in Item 408(c) of Regulation S-K.
ITEM 9C. DISCLOSURES REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
Not applicable.
PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, CODE OF ETHICS AND CORPORATE GOVERNANCE
We have adopted a Code of Business Ethics and Conduct that applies to all of our employees, including our principal executive
officer, president, principal financial officer and principal accounting officer, and Board of Directors. The Code of Business
Ethics and Conduct is published on the “Investors-Governance” section of our website at www.apog.com. Any amendments to
the Code of Business Ethics and Conduct and waivers of the Code of Business Ethics and Conduct for our Chief Executive
Officer and Chief Financial Officer will be published on our website.
The other information required by this item, other than the information set forth in Part I above under the heading “Information
About Our Executive Officers,” is set forth under the headings “Proposal 1: Election of Directors,” “Frequently Asked
Questions - How Can I Recommend or Nominate a Director Candidate?”, “Corporate Governance - Board Meetings and 2025
Annual Meeting of Shareholders,” and “Corporate Governance - Board Committee Responsibilities, Meetings and
Membership” in the Proxy Statement for the Company's Annual Meeting of Shareholders to be held on June 25, 2025, which
will be filed with the Securities and Exchange Commission within 120 days after our fiscal year-end (our 2025 Proxy
Statement). This information is incorporated herein by reference.
We have an insider trading policy governing the purchase, sale and other dispositions of the Company's securities that applies to
all personnel of the Company and its subsidiaries, including directors, officers, employees and other covered persons. The
Company believes that its insider trading policy is reasonably designed to promote compliance with insider trading laws, rules
and regulations, as well as applicable listing standards. A copy of the Company’s insider trading policy is filed as Exhibit 19.1
to this report.
78
ITEM 11. EXECUTIVE AND DIRECTOR COMPENSATION
The information required by this item is set forth under the headings “Executive Compensation,” "CEO Pay Ratio Disclosure"
and “Non-Employee Director Compensation" in our 2025 Proxy Statement. This information is incorporated herein by
reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS
The following table summarizes, with respect to our equity compensation plans, the number of shares of our common stock to
be issued upon exercise of outstanding options, warrants and other rights to acquire shares, the weighted-average exercise price
of these outstanding options, warrants and rights, and the number of shares remaining available for future issuance under our
equity compensation plans as of March 1, 2025, the last day of fiscal 2025.
Plan Category
Number of Securities to
be Issued Upon Exercise
of Outstanding Options,
Warrants and Rights
Weighted-Average
Exercise Price of
Outstanding Options,
Warrants and Rights
Number of Securities
Remaining Available for
Future Issuance under
Equity Compensation
Plans (Excluding
Securities Reflected in
the First Column)
Equity compensation plans
approved by security holders
310,904 (1) (2)
N/A (3)
868,847 (4)
Equity compensation plans not
approved by security holders
None
None
None
Total
310,904
N/A
868,847
(1)
Includes 202,240 shares underlying performance share unit awards granted under our 2019 Stock Incentive Plan, assuming maximum performance;
77,522 restricted stock unit awards granted under our 2019 Stock Incentive Plan, 2009 Non-Employee Director Stock Plan, and 2019 Non-Employee
Director Stock Plan, and 31,142 phantom shares under our Deferred Compensation Plan for Non-Employee Directors. Dividends accrue on the
outstanding performance share units during the three-year performance periods but will be paid only on shares earned at the end of each performance
cycle. Certain outstanding restricted stock units have dividend rights attached, but none of the restricted stock units are transferable.
(2)
At the beginning of fiscal years 2023, 2024 and 2025, performance share units were awarded to plan participants which will vest based on our
Company’s performance over each three-year performance period. The performance share units represent the right to receive shares of our common
stock at the end of each three-year performance period. Pursuant to SEC rules and the reporting requirements for this table, we have included in this
column 202,240 shares underlying the outstanding performance share units at maximum performance, assuming our Company performed at the
maximum level during the applicable performance periods. Only 101,120 shares underly the performance awards at target level performance.
(3)
In calculating the weighted-average exercise price of outstanding options, warrants and rights, we have not included in this column shares of restricted
stock that are issued and outstanding, performance share units or restricted stock units.
(4)
Pursuant to SEC Rules and the reporting requirements for this table, of these shares, 3,822 are available for issuance under our Legacy Partnership
Plan; 696,893 are available for grant under our 2019 Stock Incentive Plan; 152,602 are available for grant under our 2019 Non-Employee Director
Stock Plan; and 15,530 are available for grant under our Deferred Compensation Plan for Non-Employee Directors.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
The information required by this item is set forth under the headings “Corporate Governance - Director Independence” and
"Corporate Governance - Certain Relationships and Related Transactions" in our 2025 Proxy Statement. This information is
incorporated herein by reference.
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Information about aggregate fees billed to us by our principal accountant, Deloitte & Touche LLP (PCAOB ID No. 34) will be
presented under the headings “Audit Committee Report" and "Fees Paid to Independent Registered Public Accounting Firm -
Audit Fees, Audit-Related Fees, Tax Fees and All Other Fees” and “Policy on Audit Committee Pre-Approval of Audit and
Permissible Non-Audit Services” in our 2025 Proxy Statement. This information is incorporated herein by reference.
PART IV
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
a)
List of documents filed as a part of this report:
1.
Financial Statements - The consolidated financial statements listed below are set forth in Item 8 of Part II of this report.
79
Consolidated Balance Sheets as of March 1, 2025 and March 2, 2024
Consolidated Results of Operations for the Years Ended March 1, 2025, March 2, 2024 and February 25, 2023
Consolidated Statements of Comprehensive Earnings for the Years Ended March 1, 2025, March 2, 2024 and February 25,
2023
Consolidated Statements of Cash Flows for the Years Ended March 1, 2025, March 2, 2024 and February 25, 2023
Consolidated Statements of Shareholders' Equity for the Years Ended March 1, 2025, March 2, 2024 and February 25,
2023
Notes to Consolidated Financial Statements
2.
Financial Statement Schedules - All schedules for which provision is made in the applicable accounting regulations of the
Securities and Exchange Commission have been omitted because they are not applicable or the required information is
shown in the financial statements or notes thereto.
3.
Exhibits - Exhibits marked with an asterisk (*) identify each management contract or compensatory plan or arrangement.
Exhibits marked with a pound sign (#) are filed herewith. The remainder of the exhibits have heretofore been filed with the
Securities and Exchange Commission and are incorporated herein by reference.
2.1
Membership Interest Purchase Agreement, dated as of September 23, 2024, by and among UW Holdings, LLC,
UW Interco, LLC and Apogee Enterprises, Inc.* Incorporated by reference to Exhibit 2.1 to the Registrant’s
Current Report on Form 8-K filed on September 25, 2024.
3.1
Restated Articles of Incorporation. Incorporated by reference to Exhibit 3.1 to Registrant's Annual Report on Form
10-K for the year-ended February 28, 2004.
3.2
Articles of Amendment to Restated Articles of Incorporation. Incorporated by reference to Exhibit 3.1 to
Registrant's Current Report on Form 8-K filed on January 16, 2020.
3.3
Amended and Restated Bylaws of Apogee Enterprises, Inc. Incorporated by reference to Exhibit 3.3 to the
Registrant’s Quarterly Report on Form 10-Q filed on July 1, 2021.
4.1
Specimen certificate for shares of common stock of Apogee Enterprises, Inc. Incorporated by reference to Exhibit
4.1 to Registrant's Quarterly Report on Form 10-Q filed on July 1, 2021.
4.2
Description of Securities. Incorporated by reference to Exhibit 4.2 to Registrant's Annual Report on Form 10-K for
the year ended February 29, 2020.
10.1*
Apogee Enterprises, Inc. Deferred Compensation Plan for Non-Employee Directors (2014 Restatement).
Incorporated by reference to Exhibit 4.4 to Registrant's Registration Statement on Form S-8 filed on July 24, 2014.
10.2*
Apogee Enterprises, Inc. 2021 Deferred Compensation Plan for Non-Employee Directors. Incorporated by
reference to Exhibit 4.5 to Apogee’s Registration Statement on Form S-8 filed on October 13, 2021.
10.3*
Apogee Enterprises, Inc. 2000 Employee Stock Purchase Plan (Amended and Restated Effective as of April 21,
2021). Incorporated by reference to Exhibit 10.4 to Apogee’s Annual Report on Form 10-K filed on April 22,
2021.
10.4*
Apogee Enterprises, Inc. Non-Employee Director Charitable Matching Contribution Program. Incorporated by
reference to Exhibit 10.25 to Registrant's Annual Report on Form 10-K for the year-ended February 26, 2005.
10.5*
Apogee Enterprises, Inc. Deferred Incentive Compensation Plan (2005 Restatement). Incorporated by reference to
Exhibit 10.3 to Registrant's Current Report on Form 8-K filed on October 17, 2006.
10.6*
Apogee Enterprises, Inc. 2009 Stock Incentive Plan, as amended and restated (2011). Incorporated by reference to
Exhibit 10.1 to Registrant's Current Report on Form 8-K filed on June 28, 2011.
10.7*
Apogee Enterprises, Inc. 2009 Non-Employee Director Stock Incentive Plan, as amended and restated (2014).
Incorporated by reference to Exhibit 4.4 to Registrant's Registration Statement on Form S-8 filed on July 24, 2014.
10.8*
Form of Restricted Stock Agreement under the Apogee Enterprises, Inc. 2009 Non-Employee Director Stock
Incentive Plan. Incorporated by reference to Exhibit 10.3 to Registrant's Current Report on Form 8-K filed on June
30, 2009.
10.9*
Restricted Stock Deferral Program under the Apogee Enterprises, Inc. 2009 Non-Employee Director Stock
Incentive Plan, as Amended and Restated (2014) (2015 Statement). Incorporated by reference to Exhibit 10.1 to
Registrant's Current Report on Form 8-K filed on June 30, 2015.
10.10*
Form of Deferred Restricted Stock Unit Agreement under the Apogee Enterprises, Inc. 2009 Non-Employee
Director Stock Incentive Plan, as Amended and Restated (2014) (2015 Statement). Incorporated by reference to
Exhibit 10.2 to Registrant's Current Report on Form 8-K filed on June 30, 2015.
80
10.11*
Form of Restricted Stock Agreement under the Apogee Enterprises, Inc. 2009 Stock Incentive Plan for awards
made on or after April 26, 2011. Incorporated by reference to Exhibit 10.3 to Registrant's Current Report on Form
8-K filed on May 2, 2011.
10.12*
Apogee Enterprises, Inc. 2011 Deferred Compensation Plan, effective January 1, 2011. Incorporated by reference
to Exhibit 10.1 to Registrant's Current Report on Form 8-K filed on October 12, 2010.
10.13*
First Amendment to the Apogee Enterprises, Inc. 2011 Deferred Compensation Plan. Incorporated by reference to
Exhibit 10.3 to the Registrant's Current Report on Form 8-K filed July 1, 2014.
10.14*
Second Amendment to the Apogee Enterprises, Inc. 2011 Deferred Compensation Plan. Incorporated herein by
reference to Exhibit 10.2 to Registrant’s Current Report on Form 8-K filed on June 29, 2016.
10.15*
Third Amendment to the Apogee Enterprises, Inc. 2011 Deferred Compensation Plan, dated October 5, 2017.
Incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed on October 10,
2017.
10.16*
Fourth Amendment to the Apogee Enterprises, Inc. 2011 Deferred Compensation Plan, dated June 28, 2018.
Incorporated by reference to Exhibit 10.2 to Registrant's Current Report on Form 8-K filed on July 3, 2018.
10.17*
Fifth Amendment to the Apogee Enterprises, Inc. Deferred Incentive Compensation Plan (2005 Restatement), dated
June 26, 2023. Incorporated by reference to Exhibit 10.2 to Registrant's Current Report on Form 8-K filed on June
27, 2023.
10.18*
Form of Change-in-Control Severance Agreement. Incorporated herein by reference to Exhibit 10.38 to Registrant's
Annual Report on Form 10-K filed on April 30, 2018.
10.19*
Apogee Enterprises, Inc. 2019 Non-Employee Director Stock Plan. Incorporated by reference to Exhibit 4.6 to
Registrant's Registration Statement on Form S-8 filed on February 12, 2020.
10.20*
Apogee Enterprises, Inc. 2019 Stock Incentive Plan. Incorporated by reference to Exhibit 4.5 to Registrant's
Registration Statement on Form S-8 filed on February 12, 2020.
10.21*
Form of Restricted Stock Agreement under the Apogee Enterprises, Inc. 2019 Stock Plan. Incorporated by
reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed on January 16, 2020.
10.22*
Form of Stock Option Agreement under the Apogee Enterprises, Inc. 2019 Stock Incentive Plan. Incorporated by
reference to Exhibit 10.1 to Registrant's Current Report on Form 8-K filed on July 7, 2020.
10.23*
Apogee Enterprises, Inc. 2019 Stock Incentive Plan, as Amended and Restated (2021). Incorporated by reference to
Exhibit 4.5 to Apogee’s Registration Statement on Form S-8 filed on June 25, 2021.
10.24*
Amended Form of Restricted Stock Agreement under the Apogee Enterprises, Inc. 2019 Stock Incentive Plan, as
Amended and Restated (2021). Incorporated by reference to Exhibit 10.2 to Registrant's Current Report on Form 8-
K filed on May 7, 2024.
10.25*
Amended Form of Restricted Stock Unit Agreement under the Apogee Enterprises, Inc. 2019 Stock Incentive Plan,
as Amended and Restated (2021). Incorporated by reference to Exhibit 10.3 to Registrant's Current Report on Form
8-K filed on May 7, 2024.
10.26*
Executive Equity Deferral Program Under the Apogee Enterprises, Inc. 2019 Stock Incentive Plan dated May 1,
2024. Incorporated by reference to Exhibit 10.7 to Registrant's Current Report on Form 8-K filed on May 7, 2024.
10.27*
Apogee Enterprises, Inc. 2019 Non-Employee Stock Plan, as Amended and Restated (2024). Incorporated by
reference to Exhibit 4.5 to Apogee's Registration Statement on Form S-8 filed on June 20, 2024.
10.28*
Form of Restricted Stock Agreement under the Apogee Enterprises, Inc. 2019 Non-Employee Director Stock Plan.
Incorporated by reference to Exhibit 10.2 to Registrant’s Current Report on Form 8-K filed on January 16, 2020.
10.29*
Form of Deferred Restricted Stock Unit Agreement under the Apogee Enterprises, Inc. 2019 Non-Employee
Director Stock Incentive Plan. Incorporated by reference to Exhibit 10.3 to Registrant’s Current Report on Form 8-
K filed on January 16, 2020.
10.30*
Restricted Stock Deferral Program Under the Apogee Enterprises, Inc. 2019 Non-Employee Director Stock
Incentive Plan. Incorporated by reference to Exhibit 10.1 to Registrant's Current Report on Form 8-K filed on April
29, 2020.
10.31*
Form of Restricted Stock Unit Agreement under the Apogee Enterprises, Inc. 2019 Non-Employee Director Stock
Plan. Incorporated by reference to Exhibit 10.2 to Registrant's Current Report on Form 8-K filed on April 29, 2020.
10.32*
Form of CEO Evaluation-Based Incentive Agreement. Incorporated by reference to Exhibit 10.2 to Registrant’s
Current Report on Form 8-K filed on April 30, 2019.
10.33*
Form of Annual Cash Incentive Award Agreement. Incorporated by reference to Exhibit 10.2 to Registrant's
Current Report on Form 8-K filed on July 7, 2020.
10.34*
Employment Agreement between Apogee Enterprises, Inc. and Ty R. Silberhorn, dated December 15, 2020.
Incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed on December 21, 2020.
10.35*
Form of Restricted Stock Award Agreement entered into by Apogee Enterprises, Inc. and Ty R. Silberhorn on
January 4, 2021. Incorporated by reference to Exhibit 10.2 to Registrant’s Current Report on Form 8-K filed on
December 21, 2020.
10.36*
Form of Restricted Stock Agreement. Incorporated by reference to Exhibit 10.1 to Registrant's Current Report on
Form 8-K filed on April 26, 2021.
81
10.37*
Form of Performance Award Agreement. Incorporated by reference to Exhibit 10.2 to Registrant's Current Report
on Form 8-K filed on April 26, 2021.
10.38*
Form of Executive Short-Term Incentive Plan Memorandum. Incorporated by reference to Exhibit 10.3 to
Registrant's Current Report on Form 8-K filed on April 26, 2021.
10.39*
Executive Short-Term Incentive Plan Terms and Conditions. Incorporated by reference to Exhibit 10.4 to
Registrant's Current Report on Form 8-K filed on April 26, 2021.
10.40*
Offer Letter dated March 2, 2023 between Apogee Enterprises, Inc. and Matthew J. Osberg. Incorporated by
reference to Exhibit 10.1 to Registrant's Current Report on Form 8-K filed on March 8, 2023.
10.41
Third Amended and Restated Credit Agreement, dated as of June 25, 2019, by and among Apogee Enterprises,
Inc., as the Borrower, the Lenders referred to therein, Wells Fargo Bank, National Association, as Administrative
Agent, Swingline Lender and Issuing Lender, and U.S. Bank National Association, as Syndication Agent and
Issuing Lender. Incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed on June
28, 2019.
10.42
Amendment No. 1 to Third Amended and Restated Credit Agreement dated as of June 25, 2019, by and among
Apogee Enterprises, Inc., as the Borrower, the Lenders referred to therein, Wells Fargo Bank, National Association,
as Administrative Agent, Swingline Lender and Issuing Lender, and U.S. Bank National Association, as
Syndication Agent and Issuing Lender. Incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on
Form 8-K filed on April 10, 2020.
10.43
Amendment No. 2 to Third Amended and Restated Credit Agreement dated as of November 6, 2020, by and among
Apogee Enterprises, Inc., as the Borrower, the Lenders referred to therein, Wells Fargo Bank, National Association,
as Administrative Agent, Swingline Lender and Issuing Lender, and U.S. Bank National Association, as
Syndication Agent and Issuing Lender. Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report
on Form 8-K filed on November 10, 2020.
10.44
Amendment No. 3 to Third Amended and Restated Credit Agreement dated as of August 5, 2022, by and among
Apogee Enterprises, Inc., as the Borrower, the Lenders referred to therein, Wells Fargo Bank, National Association,
as Administrative Agent, Swingline Lender and Issuing Lender, and U.S. Bank National Association, as
Syndication Agent and Issuing Lender. Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report
on Form 8-K filed on August 5, 2022.
10.45
Credit Agreement dated July 19, 2024 between Apogee Enterprises, Inc., certain material domestic subsidiaries of
the Company as guarantors, Bank of America, N.A., as administrative agent, swingline lender and L/C issuer and
the syndicate of lenders which are party thereto from time to time. Incorporated by reference to Exhibit 10.1 to the
Registrant’s Current Report on Form 8-K filed on July 25, 2024.
19.1#
Apogee Enterprises, Inc. Insider Trading Policy.
21#
Subsidiaries of the Registrant.
23#
Consent of Deloitte & Touche LLP.
31.1#
Certification of Chief Executive Officer pursuant to rule 13a-14(a) under the Securities Exchange Act of 1934.
31.2#
Certification of Chief Financial Officer pursuant to rule 13a-14(a) under the Securities Exchange Act of 1934.
32.1#
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002.
32.2#
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002.
97.1
Incentive Compensation Recovery Policy. Incorporated by reference to Exhibit 97.1 to the Registrant’s Current
Report on Form 10-K filed on April 26, 2024.
101
The following materials from Apogee Enterprises, Inc.'s Annual Report on Form 10-K for the year ended March 1,
2025 are furnished herewith, formatted in iXBRL (Inline Extensible Business Reporting Language): (i) the
Consolidated Balance Sheets as of March 1, 2025 and March 2, 2024, (ii) the Consolidated Results of Operations
for the three years ended March 1, 2025, March 2, 2024 and February 25, 2023, (iii) the Consolidated Statements of
Comprehensive Earnings for the three years March 1, 2025, March 2, 2024 and February 25, 2023, (iv) the
Consolidated Statements of Cash Flows for the three years ended March 1, 2025, March 2, 2024 and February 25,
2023, (v) the Consolidated Statements of Shareholders' Equity for the three years ended March 1, 2025, March 2,
2024 and February 25, 2023 and (vi) the Notes to Consolidated Financial Statements.
104
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).
ITEM 16. FORM 10-K SUMMARY
None.
82
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly authorized, on April 24, 2025.
APOGEE ENTERPRISES, INC.
/s/ Ty R. Silberhorn
Ty R. Silberhorn
President and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following
persons on behalf of the registrant and in the capacities indicated on April 24, 2025.
Signature
Title
Signature
Title
/s/ Ty R. Silberhorn
President, Chief
Executive Officer
and Director
/s/ Matthew J. Osberg
Executive Vice
President and Chief
Financial Officer
Ty R. Silberhorn
(Principal Executive
Officer)
Matthew J. Osberg
(Principal
Financial and
Accounting Officer)
/s/ Donald A. Nolan
/s/ Elizabeth M. Lilly
Donald A. Nolan
Chairman
Elizabeth M. Lilly
Director
/s/ Christina M. Alvord
/s/ Herbert K. Parker
Christina M. Alvord
Director
Herbert K. Parker
Director
/s/ Frank G. Heard
/s/ Mark A. Pompa
Frank G. Heard
Director
Mark A. Pompa
Director
/s/ Lloyd E. Johnson
/s/ Patricia K. Wagner
Lloyd E. Johnson
Director
Patricia K. Wagner
Director
83
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Meghan M. Elliott, 48
Senior Vice President, Chief Legal
Officer, and Secretary
Brent C. Jewell, 51
President, Architectural Glass
Troy R. Johnson, 51
President, Architectural Services
Veena Lakkundi, 56
President, Performance Surfaces
Nick C. Longman, 53
President, Architectural Metals
Matt Osberg, 49
Chief Financial Officer
Raelyn Trende, 49
Executive Vice President and Chief
Human Resources Officer
APOGEE SEGMENTS
Architectural Glass Segment
Owatonna, MN
Architectural Metals Segment
Minneapolis, MN
Architectural Services Segment
Minneapolis, MN
Performance Surfaces Segment
McCook, IL
CORPORATE INFORMATION
BOARD OF DIRECTORS
Donald A. Nolan, 64
Chair of the Board
Apogee Enterprises, Inc.
Former President and Chief Executive Officer
Kennametal Inc.
Christina M. Alvord, 58 1, 3
Retired President, Southern & Gulf Coast,
and Central Divisions
Vulcan Materials Company
Frank G. Heard, 66 1, 3
Retired Chief Executive Officer
Gibraltar Industries, Inc.
Lloyd E. Johnson, 71 1, 2
Retired Global Managing Director, Finance and
Internal Audit
Accenture Corporation
Elizabeth M. Lilly, 62 1, 2
Chief Investment Officer and Executive Vice President
The Pohlad Companies
Herbert K. Parker, 67 2, 3
Retired Executive Vice President-Operational
Excellence Harman International Industries, Inc.
Mark A. Pompa, 60 1, 2
Retired Executive Vice President and Chief Financial
Officer
EMCOR Group, Inc.
Ty R. Silberhorn, 57
Chief Executive Officer
Apogee Enterprises, Inc.
Patricia K. Wagner, 62 2, 3
Retired Group President of U.S. Utilities
Sempra Energy
1 Audit Committee
2 Compensation Committee
3 Nominating and Corporate Governance Committee
INVESTOR INFORMATION
INVESTOR INQUIRIES
Additional information, such as Forms 10-K, 10-Q and proxy
statements as filed with the Securities and Exchange
Commission, and news releases, may be obtained through one
of the following:
Internet: www.apog.com
Email: IR@apog.com
Telephone: (952) 835-1874
Toll Free: (877) 752-3432
Mail: Apogee Enterprises, Inc.
Attn: Investor Relations
4400 West 78th Street, Suite 520
Minneapolis, MN 55435
TRANSFER AGENT AND REGISTRAR
To sign up for direct deposit of dividends service, or for inquiries
regarding stock certificates, such as address or name changes,
lost certificates or lost dividends, contact Computershare Investor
Services, Apogee's transfer agent and registrar.
Computershare Investor Services address:
P.O. Box 43078
Providence, RI 02940-3078
Computershare Investor Services website:
www.computershare.com
Computershare Investor Services telephone numbers:
U.S. Residents: (800) 736-3001
Canada or the U.S. Virgin Islands: (800) 736-3001
Outside the U.S.: (781) 575-3100
COMMON STOCK
Apogee Enterprises, Inc. common stock is traded on
the Nasdaq Stock Market LLC under the symbol APOG.
CORPORATE OFFICERS
Ty R. Silberhorn, 57
Chief Executive Officer and President
BR037598-0525-10K