Masonite International

 2019 MASONITE 

ANNUAL 
REPORT

Our Vision

Opening New Doors for Customers, Partners and Employees

(cid:39)(cid:72)(cid:68)(cid:85)(cid:3)(cid:86)(cid:75)(cid:68)(cid:85)(cid:72)(cid:75)(cid:82)(cid:79)(cid:71)(cid:72)(cid:85)(cid:86)(cid:15)(cid:3)(cid:70)(cid:88)(cid:86)(cid:87)(cid:82)(cid:80)(cid:72)(cid:85)(cid:86)(cid:15)(cid:3)(cid:86)

(cid:88)(cid:83)(cid:83)(cid:79)(cid:76)(cid:72)(cid:85)(cid:3)(cid:83)(cid:68)(cid:85)(cid:87)(cid:81)(cid:72)(cid:85)(cid:86)(cid:15)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:70)(cid:82)(cid:79)(cid:79)(cid:72)(cid:68)(cid:74)

(cid:74)(cid:88)(cid:72)(cid:86)

(cid:15)(cid:3)

(cid:50)(cid:3)(cid:82)(cid:73)
(cid:73)
(cid:44)(cid:3)(cid:68)(cid:80)(cid:3)(cid:71)(cid:72)(cid:79)(cid:76)(cid:74)(cid:75)(cid:87)(cid:72)(cid:71)(cid:3)(cid:87)(cid:82)(cid:3)(cid:90)(cid:85)(cid:76)(cid:87)(cid:72)(cid:3)(cid:80)(cid:92)(cid:3)(cid:73)(cid:76)(cid:85)(cid:86)(cid:87)(cid:3)(cid:79)(cid:72)(cid:87)(cid:87)(cid:72)(cid:85)(cid:3)(cid:68)(cid:86)(cid:3)(cid:51)(cid:85)(cid:72)(cid:86)(cid:76)(cid:71)(cid:72)(cid:81)(cid:87)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:38)(cid:40)(cid:50) (cid:3)(cid:48)(cid:68)(cid:86)(cid:82)(cid:81)(cid:76)(cid:87)(cid:72)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:87)(cid:82)(cid:3)(cid:86)(cid:75)(cid:68)(cid:85)(cid:72)(cid:3)(cid:86)(cid:76)(cid:74)(cid:81)(cid:76)(cid:73)(cid:76)(cid:70)(cid:68)(cid:81)(cid:87)(cid:3)
(cid:70)(cid:82)(cid:81)(cid:86)
(cid:76)(cid:71)(cid:72)(cid:85)(cid:72)(cid:71)(cid:3)(cid:68)(cid:3)(cid:87)(cid:85)(cid:68)(cid:81)(cid:86)(cid:73)(cid:82)(cid:85)(cid:80)(cid:68)(cid:87)(cid:76)(cid:82)(cid:81)(cid:68)(cid:79)(cid:3)(cid:92)(cid:72)(cid:68)(cid:85)(cid:3)(cid:73)(cid:82)(cid:85)(cid:3)
(cid:83)(cid:85)(cid:82)(cid:74)(cid:85)(cid:72)(cid:86)(cid:86)(cid:3)(cid:68)(cid:74)(cid:68)(cid:76)(cid:81)(cid:86)(cid:87)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:82)(cid:69)(cid:77)(cid:72)(cid:70)(cid:87)(cid:76)(cid:89)(cid:72)(cid:86)(cid:3)(cid:76)
(cid:71)(cid:3)(cid:70)(cid:82)(cid:81)(cid:87)(cid:76)(cid:81)(cid:88)(cid:72)(cid:71)(cid:3)(cid:81)(cid:72)(cid:87)(cid:3)(cid:86)(cid:68)(cid:79)(cid:72)(cid:86)(cid:3)(cid:74)(cid:85)(cid:82)(cid:90)(cid:87)(cid:75)(cid:3)
(cid:71)(cid:72)(cid:79)(cid:76)(cid:89)(cid:72)(cid:85)(cid:72)
(cid:82)(cid:88)(cid:85)(cid:3)(cid:70)(cid:82)(cid:80)(cid:83)(cid:68)(cid:81)(cid:92)(cid:17)(cid:3)(cid:3)(cid:21)(cid:19)(cid:20)(cid:28)(cid:3)(cid:90)(cid:68)(cid:86)(cid:3)(cid:68)(cid:3)(cid:69)(cid:68)(cid:81)(cid:81)(cid:72)(cid:85)(cid:3)(cid:92)(cid:72)(cid:68)
(cid:68)(cid:81)(cid:71)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:75)(cid:76)(cid:74)(cid:75)(cid:72)(cid:86)(cid:87)(cid:3)(cid:68)(cid:71)(cid:77)(cid:88)(cid:86)(cid:87)(cid:72)(cid:71)(cid:3)(cid:40)(cid:37)(cid:44)(cid:55)(cid:39)(cid:36)(cid:3)(cid:80)(cid:68)(cid:85)(cid:74)(cid:76)(cid:81)(cid:20)
(cid:79)(cid:76)(cid:70)(cid:3)(cid:76)(cid:81)(cid:3)(cid:21)(cid:19)(cid:20)(cid:22)(cid:17)(cid:3)(cid:3)(cid:39)(cid:72)(cid:86)(cid:83)(cid:76)(cid:87)(cid:72)(cid:3)(cid:70)(cid:88)(cid:85)(cid:85)(cid:72)(cid:81)(cid:87)(cid:3)(cid:80)(cid:68)(cid:85)(cid:78)(cid:72)(cid:87)(cid:3)
(cid:88)(cid:81)(cid:70)(cid:72)(cid:85)(cid:87)(cid:68)(cid:76)(cid:81)(cid:87)(cid:76)(cid:72)(cid:86)(cid:15)(cid:3)(cid:90)(cid:72)(cid:3)(cid:69)(cid:72)(cid:79)(cid:76)(cid:72)(cid:89)(cid:72)(cid:3)(cid:90)(cid:72)(cid:3)(cid:86)(cid:72)(cid:87)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:86)(cid:87)(cid:68)(cid:74)(cid:72)(cid:3)(cid:73)(cid:82)(cid:85)(cid:3)(cid:70)(cid:82)(cid:81)(cid:86)(cid:76)(cid:86)(cid:87)(cid:72)(cid:81)(cid:87)(cid:3)(cid:79)(cid:82)(cid:81) (cid:87)(cid:72)(cid:85)(cid:80)(cid:3)(cid:83)(cid:85)(cid:82)(cid:73)(cid:76)(cid:87)(cid:68)(cid:69)(cid:79)(cid:72)(cid:3)(cid:74)(cid:85)(cid:82)(cid:90)(cid:87)(cid:75)(cid:3)(cid:76)(cid:81)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:92)(cid:72)(cid:68)(cid:85)(cid:86)
(cid:74)(cid:16)
(cid:87)(cid:82)(cid:3)(cid:70)(cid:82)(cid:80)(cid:72)(cid:17)(cid:3)

(cid:81)(cid:3)(cid:90)(cid:75)(cid:68)(cid:87)(cid:3)(cid:90)(cid:72)(cid:3)(cid:69)(cid:72)(cid:79)(cid:76)(cid:72)(cid:89)(cid:72)(cid:3)(cid:90)(cid:76)(cid:79)(cid:79)(cid:3)(cid:69)(cid:72)(cid:3)(cid:70)
(cid:85)(cid:3)(cid:73)(cid:82)(cid:85)(cid:3)(cid:48)(cid:68)(cid:86)(cid:82)(cid:81)(cid:76)(cid:87)(cid:72)(cid:17)(cid:3)(cid:3)(cid:58)(cid:72)(cid:3)(cid:71)
(cid:3)(cid:86)(cid:76)(cid:81)(cid:70)(cid:72)(cid:3)(cid:74)(cid:82)(cid:76)(cid:81)(cid:74)(cid:3)(cid:83)(cid:88)(cid:69)(cid:79)

(cid:81)(cid:3)(cid:82)(cid:73)(cid:3)(cid:68)(cid:3)(cid:87)(cid:75)(cid:82)(cid:85)(cid:82)(cid:88)(cid:74)(cid:75)(cid:3)(cid:179)(cid:89)(cid:82)(cid:76)(cid:70)(cid:72)(cid:3)(cid:82)(cid:73)(cid:3)(cid:87)(cid:75)(cid:72)
(cid:85)(cid:78)(cid:72)(cid:87)(cid:86)(cid:15)(cid:3)(cid:70)(cid:75)(cid:68)(cid:81)(cid:81)(cid:72)(cid:79)(cid:86)(cid:15)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:72)(cid:81)(cid:71)(cid:3)(cid:88)(cid:86)(cid:72)(cid:85)(cid:86)(cid:3)(cid:87)(cid:82)(cid:3)
(cid:78)(cid:3)(cid:70)(cid:82)(cid:81)(cid:86)(cid:76)(cid:86)(cid:87)(cid:72)(cid:71)(cid:3)(cid:82)(cid:73)(cid:3)(cid:69)(cid:82)(cid:87)(cid:75)(cid:3)(cid:84)(cid:88)(cid:68)(cid:81)(cid:87)(cid:76)(cid:87)(cid:68)(cid:87)(cid:76)(cid:89)(cid:72)(cid:3)

(cid:51)(cid:72)(cid:85)(cid:75)(cid:68)(cid:83)(cid:86) (cid:82)(cid:88)(cid:85) (cid:80)(cid:82)(cid:86)(cid:87) (cid:76)(cid:80)(cid:83)(cid:82)(cid:85)(cid:87)(cid:68)(cid:81)(cid:87) (cid:76)(cid:81)(cid:76)(cid:87)(cid:76)(cid:68)(cid:87)(cid:76)(cid:89)(cid:72) (cid:76)(cid:81) (cid:21)(cid:19)(cid:20)(cid:28) (cid:90)(cid:68)(cid:86) (cid:87)(cid:75)(cid:72) (cid:70)(cid:82)(cid:80)(cid:83)
(cid:51)(cid:72)(cid:85)(cid:75)(cid:68)(cid:83)(cid:86)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:80)(cid:82)(cid:86)(cid:87)(cid:3)(cid:76)(cid:80)(cid:83)(cid:82)(cid:85)(cid:87)(cid:68)(cid:81)(cid:87)(cid:3)(cid:76)(cid:81)(cid:76)(cid:87)(cid:76)(cid:68)(cid:87)(cid:76)(cid:89)(cid:72)(cid:3)(cid:76)(cid:81)(cid:3)(cid:21)(cid:19)(cid:20)(cid:28)(cid:3)(cid:90)(cid:68)(cid:86)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:70)(cid:82)(cid:80)(cid:83)
(cid:83)(cid:79)(cid:72)(cid:87)(cid:76)(cid:82)
(cid:70)(cid:88)(cid:86)(cid:87)(cid:82)(cid:80)(cid:72)(cid:85)(cid:180)(cid:3)(cid:85)(cid:72)(cid:86)(cid:72)(cid:68)(cid:85)(cid:70)(cid:75)(cid:3)(cid:83)(cid:85)(cid:82)(cid:77)(cid:72)(cid:70)(cid:87)(cid:3)(cid:71)(cid:72)(cid:86)(cid:76)(cid:74)(cid:81)(cid:72)(cid:71)(cid:3)(cid:87)(cid:82)(cid:3)(cid:69)(cid:72)(cid:87)(cid:87)(cid:72)(cid:85)(cid:3)(cid:88)(cid:81)(cid:71)(cid:72)(cid:85)(cid:86)(cid:87)(cid:68)(cid:81)(cid:71)(cid:3)(cid:82)(cid:88)
(cid:88)(cid:85)(cid:3)(cid:80)(cid:68)
(cid:80)(cid:3)(cid:74)(cid:85)(cid:82)(cid:90)(cid:87)(cid:75)(cid:3)(cid:73)(cid:85)(cid:68)(cid:80)(cid:72)(cid:90)(cid:82)(cid:85)(cid:78)(cid:17)(cid:3)(cid:3)(cid:55)(cid:75)
(cid:86)(cid:72)(cid:87)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:73)(cid:82)(cid:88)(cid:81)(cid:71)(cid:68)(cid:87)(cid:76)(cid:82)(cid:81)(cid:3)(cid:73)(cid:82)(cid:85)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:79)(cid:82)(cid:81)(cid:74)(cid:16)(cid:87)(cid:72)(cid:85)
(cid:75)(cid:72)(cid:3)(cid:90)(cid:82)(cid:85)
(cid:68)(cid:81)(cid:71)(cid:3)(cid:84)(cid:88)(cid:68)(cid:79)(cid:76)(cid:87)(cid:68)(cid:87)(cid:76)(cid:89)(cid:72)(cid:3)(cid:86)(cid:87)(cid:88)(cid:71)(cid:76)(cid:72)(cid:86)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:90)(cid:72)(cid:3)(cid:79)(cid:72)(cid:68)(cid:85)(cid:81)(cid:72)(cid:71)(cid:3)(cid:68)(cid:3)(cid:74)(cid:85)(cid:72)(cid:68)(cid:87)(cid:3)(cid:71)(cid:72)(cid:68)(cid:79)(cid:3)(cid:68)(cid:69)(cid:82)(cid:88)(cid:87)(cid:3)(cid:87)(cid:75)(cid:72) (cid:82)(cid:81)(cid:86)(cid:88)(cid:80)(cid:72)(cid:85)(cid:17)(cid:3)(cid:3)(cid:58)(cid:75)(cid:76)(cid:79)(cid:72)(cid:3)(cid:80)(cid:82)(cid:86)(cid:87)(cid:3)(cid:72)(cid:89)(cid:72)(cid:85)(cid:92)(cid:87)(cid:75)(cid:76)(cid:81)(cid:74)
(cid:72)(cid:3)(cid:70)
(cid:68)(cid:85)(cid:82)(cid:88)(cid:81)(cid:71)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:75)(cid:82)(cid:88)(cid:86)(cid:72)(cid:3)(cid:75)(cid:68)(cid:86)(cid:3)(cid:72)(cid:89)(cid:82)(cid:79)(cid:89)(cid:72)(cid:71)(cid:15)(cid:3)(cid:71)(cid:82)(cid:82)(cid:85)(cid:86)(cid:3)(cid:74)(cid:72)(cid:81)(cid:72)(cid:85)(cid:68)(cid:79)(cid:79)(cid:92)(cid:3)(cid:75)(cid:68)(cid:89)(cid:72)(cid:3)(cid:81)(cid:82)(cid:87)(cid:17)(cid:3)(cid:3)(cid:38)(cid:82)
(cid:82)(cid:81)(cid:86)(cid:88)(cid:80)
(cid:80)(cid:82)(cid:85)(cid:72)(cid:3)(cid:79)(cid:76)(cid:74)(cid:75)(cid:87)(cid:15)(cid:3)(cid:83)(cid:85)(cid:76)(cid:89)(cid:68)(cid:70)(cid:92)(cid:15)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:83)(cid:85)(cid:82)(cid:87)(cid:72)(cid:70)(cid:87)(cid:76)
(cid:82)(cid:81)(cid:3)(cid:73)(cid:85)(cid:82)(cid:80)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:72)(cid:79)(cid:72)(cid:80)(cid:72)(cid:81)(cid:87)(cid:86)(cid:15)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:90) (cid:81)(cid:87)(cid:72)(cid:81)(cid:71)(cid:3)(cid:87)(cid:82) (cid:71)(cid:72)(cid:79)(cid:76)(cid:89)(cid:72)(cid:85)(cid:3)(cid:179)(cid:39)(cid:82)(cid:82)(cid:85)(cid:86)(cid:3)(cid:87)(cid:75)(cid:68)(cid:87) (cid:71)(cid:82)(cid:3)
(cid:90)(cid:72)(cid:3)(cid:76)
(cid:80)(cid:82)(cid:85)(cid:72)(cid:180)(cid:140)(cid:17)(cid:3)(cid:3)(cid:36)(cid:71)(cid:71)(cid:76)(cid:87)(cid:76)(cid:82)(cid:81)(cid:68)(cid:79)(cid:79)(cid:92)(cid:15)(cid:3)(cid:87)(cid:75)(cid:76)(cid:86)(cid:3)(cid:85)(cid:72)(cid:86)(cid:72)(cid:68)(cid:85)(cid:70)(cid:75)(cid:3)(cid:74)(cid:68)(cid:89)
(cid:72)(cid:3)(cid:88)(cid:86)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:70)(cid:82)(cid:81)(cid:73)(cid:76)(cid:71)(cid:72)(cid:81)(cid:70)(cid:72)
(cid:72)(cid:3)(cid:87)(cid:82)(cid:3)(cid:76)(cid:80)(cid:83)(cid:79)(cid:72)(cid:80)
(cid:81)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:73)(cid:82)(cid:88)(cid:85)(cid:87)(cid:75)(cid:3)(cid:84)(cid:88)(cid:68)(cid:85)(cid:87)(cid:72)(cid:85)(cid:3)(cid:82)(cid:73)(cid:3)(cid:21)(cid:19)(cid:20)(cid:28)(cid:17)(cid:3)(cid:3)(cid:44)(cid:81)(cid:3)
(cid:73)(cid:82)(cid:85)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:49)(cid:82)(cid:85)(cid:87)(cid:75)(cid:3)(cid:36)(cid:80)(cid:72)(cid:85)(cid:76)(cid:70)(cid:68)(cid:3)(cid:85)(cid:72)(cid:86)(cid:76)(cid:71)(cid:72)(cid:81)(cid:87)(cid:76)(cid:68)(cid:79)(cid:3)(cid:69)(cid:88)(cid:86)(cid:76)(cid:81)(cid:72)(cid:86)(cid:86)(cid:3)(cid:87)(cid:75)(cid:68)(cid:87)(cid:3)(cid:90)(cid:68)(cid:86)(cid:3)(cid:71)(cid:76)(cid:86)(cid:70)(cid:79)(cid:82)(cid:86)
(cid:72)(cid:71)(cid:3)(cid:76)
(cid:70)(cid:82)(cid:81)(cid:77)(cid:88)(cid:81)(cid:70)(cid:87)(cid:76)(cid:82)(cid:81)(cid:3)(cid:90)(cid:76)(cid:87)(cid:75)(cid:3)(cid:87)(cid:75)(cid:76)(cid:86)(cid:3)(cid:86)(cid:87)(cid:85)(cid:68)(cid:87)(cid:72)(cid:74)(cid:92)(cid:15)(cid:3)(cid:90)(cid:72)(cid:3)(cid:68)(cid:81)(cid:81)(cid:82)(cid:88)(cid:81)(cid:70)(cid:72)(cid:71)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:76)(cid:81)(cid:87)(cid:72)(cid:81)(cid:87)(cid:3)(cid:87)(cid:82)(cid:3)(cid:76)
(cid:86)(cid:87)(cid:3)(cid:68)(cid:81)(cid:3)(cid:68)(cid:71)(cid:71)(cid:76)(cid:87)(cid:76)(cid:82)(cid:81)(cid:68)(cid:79) (cid:7)(cid:20)(cid:19)(cid:19)(cid:3)(cid:80)(cid:76)(cid:79)(cid:79)(cid:76)(cid:82)(cid:81)(cid:3)(cid:82)(cid:89)(cid:72)(cid:85)(cid:3)
(cid:76)(cid:81)(cid:89)(cid:72)
(cid:87)(cid:75)(cid:72)(cid:3)(cid:81)(cid:72)(cid:91)(cid:87)(cid:3)(cid:73)(cid:76)(cid:89)(cid:72)(cid:3)(cid:92)(cid:72)(cid:68)(cid:85)(cid:86)(cid:3)(cid:76)(cid:81)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:68)(cid:85)(cid:72)(cid:68)(cid:86)(cid:3)(cid:82)(cid:73)(cid:3)(cid:86)(cid:72)(cid:85)(cid:89)(cid:76)(cid:70)(cid:72)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:84)(cid:88)(cid:68)(cid:79)(cid:76)(cid:87)(cid:92)(cid:15)(cid:3)(cid:81)(cid:72)(cid:90)(cid:3)(cid:83) (cid:82)(cid:71)(cid:88)(cid:70)(cid:87)(cid:3)(cid:76)(cid:81)(cid:81)(cid:82)(cid:89)(cid:68)(cid:87)(cid:76)(cid:82)(cid:81)(cid:15)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:71)(cid:82)(cid:90)(cid:81)(cid:16)(cid:70)(cid:75)(cid:68)(cid:81)(cid:81)(cid:72)(cid:79)(cid:3)
(cid:83)(cid:85)
(cid:80)(cid:68)(cid:85)(cid:78)(cid:72)(cid:87)(cid:76)(cid:81)(cid:74)(cid:15)(cid:3)(cid:68)(cid:86)(cid:3)(cid:83)(cid:68)(cid:85)(cid:87)(cid:3)(cid:82)(cid:73)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:70)(cid:82)(cid:80)(cid:80)(cid:76)(cid:87)(cid:80)(cid:72)(cid:81)(cid:87)(cid:3)(cid:87)(cid:82)(cid:3)(cid:71)(cid:85)(cid:76)(cid:89)(cid:72)(cid:3)(cid:86)(cid:88)(cid:86)(cid:87)(cid:68)(cid:76)(cid:81)(cid:68)(cid:69)(cid:79)(cid:72)(cid:3)(cid:74)
(cid:87)
(cid:74)(cid:85)(cid:82)(cid:90)(cid:87)
(cid:75)(cid:3)(cid:73)(cid:82)(cid:85)(cid:3)(cid:48)(cid:68)(cid:86)(cid:82)(cid:81)(cid:76)(cid:87)(cid:72)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:70)(cid:75)(cid:68)(cid:81)(cid:81)(cid:72)(cid:79)(cid:3)
(cid:83)(cid:68)(cid:85)(cid:87)(cid:81)(cid:72)(cid:85)(cid:86)(cid:17)

(cid:72)(cid:85)(cid:86)(cid:3)(cid:90)(cid:68)(cid:81)(cid:87)(cid:3)(cid:80)(cid:82)(cid:85)(cid:72)(cid:15)(cid:3)(cid:86)(cid:83)(cid:72)(cid:70)(cid:76)(cid:73)(cid:76)(cid:70)(cid:68)(cid:79)(cid:79)(cid:92)(cid:3)

(cid:72)(cid:81)(cid:87)(cid:3)(cid:68)(cid:3)(cid:81)(cid:72)(cid:90)(cid:3)(cid:83)(cid:85)(cid:76)(cid:70)(cid:76)(cid:81)(cid:74)(cid:3)(cid:86)(cid:87)(cid:85)(cid:68)(cid:87)(cid:72)(cid:74)(cid:92)(cid:3)

(cid:3)(cid:76)(cid:80)(cid:83)(cid:85)(cid:82)(cid:89)(cid:72)(cid:80)(cid:72)(cid:81)(cid:87)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:83)(cid:85)(cid:82)(cid:71)(cid:88)(cid:70)(cid:87)(cid:76)
(cid:50)(cid:88)(cid:85)(cid:3)(cid:76)(cid:81)(cid:87)(cid:72)(cid:81)(cid:86)(cid:72)(cid:3)(cid:73)(cid:82)(cid:70)(cid:88)(cid:86)(cid:3)(cid:82)(cid:81)(cid:3)(cid:70)(cid:82)(cid:81)(cid:87)(cid:76)(cid:81)(cid:88)(cid:82)(cid:88)(cid:86)
(cid:80)(cid:82)(cid:71)(cid:72)(cid:79)(cid:3)(cid:83)(cid:68)(cid:76)(cid:71)(cid:3)(cid:71)(cid:76)(cid:89)(cid:76)(cid:71)(cid:72)(cid:81)(cid:71)(cid:86)(cid:3)(cid:76)(cid:81)(cid:3)(cid:21)(cid:19)(cid:20)(cid:28)(cid:17)(cid:3)(cid:3)(cid:3)(cid:58)(cid:72)(cid:3)(cid:76)(cid:81)(cid:70)(cid:85)(cid:72)(cid:68)(cid:86)(cid:72)(cid:71)(cid:3)(cid:46)(cid:68)(cid:76)(cid:93)(cid:72)(cid:81)(cid:3)(cid:72)(cid:89)(cid:72)(cid:81)(cid:87)
(cid:92)(cid:72)(cid:68)(cid:85)(cid:3)(cid:82)(cid:81)(cid:3)(cid:92)(cid:72)(cid:68)(cid:85)(cid:15)(cid:3)(cid:90)(cid:76)(cid:87)(cid:75)(cid:3)(cid:82)(cid:89)(cid:72)(cid:85)(cid:3)(cid:20)(cid:15)(cid:19)(cid:19)(cid:19)(cid:3)(cid:72)(cid:89)(cid:72)(cid:81)(cid:87)(cid:86)(cid:3)(cid:75)(cid:72)(cid:79)(cid:71)(cid:3)(cid:68)(cid:70)(cid:85)(cid:82)(cid:86)(cid:86)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:73)(cid:68)(cid:70)(cid:76)(cid:79)(cid:76)(cid:87)(cid:76)(cid:76)(cid:72)(cid:86) (cid:53)(cid:82)(cid:88)(cid:74)(cid:75)(cid:79)(cid:92) (cid:82)(cid:81)(cid:72) (cid:87)(cid:75)(cid:76)(cid:85)(cid:71) (cid:82)(cid:73) (cid:82)(cid:88)(cid:85)
(cid:17)(cid:3)(cid:3)(cid:53)(cid:82)(cid:88)(cid:74)(cid:75)(cid:79)(cid:92)(cid:3)(cid:82)(cid:81)(cid:72)(cid:16)(cid:87)(cid:75)(cid:76)(cid:85)(cid:71)(cid:3)(cid:82)(cid:73)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)
(cid:68)(cid:83)(cid:83)(cid:85)(cid:82)(cid:91)(cid:76)(cid:80)(cid:68)(cid:87)(cid:72)(cid:79)(cid:92)(cid:3)(cid:20)(cid:19)(cid:15)(cid:19)(cid:19)(cid:19)(cid:3)(cid:72)(cid:80)(cid:83)(cid:79)(cid:82)(cid:92)(cid:72)(cid:72)(cid:86)(cid:3)(cid:83)(cid:68)(cid:85)(cid:87)(cid:76)(cid:70)(cid:76)(cid:83)(cid:68)(cid:87)(cid:72)(cid:71)(cid:3)(cid:76)(cid:81)(cid:3)(cid:82)(cid:81)(cid:72)(cid:3)(cid:82)(cid:85)(cid:3)(cid:80)(cid:82)(cid:85)(cid:85)(cid:72)(cid:3)(cid:46)(cid:68)(cid:76)(cid:93)(cid:72)(cid:81)(cid:3)(cid:72)(cid:89)(cid:72)(cid:81)(cid:87)(cid:86)(cid:3)(cid:87)(cid:68)(cid:85)(cid:74)(cid:72)(cid:87)(cid:76)(cid:81)(cid:74)(cid:3)(cid:90)(cid:68)(cid:86)(cid:87)(cid:72)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)
(cid:76)(cid:81)(cid:72)(cid:73)(cid:73)(cid:76)(cid:70)(cid:76)(cid:72)(cid:81)(cid:70)(cid:76)(cid:72)(cid:86)(cid:3)(cid:76)(cid:81)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:82)(cid:83)(cid:72)(cid:85)(cid:68)(cid:87)(cid:76)(cid:82)(cid:81)(cid:86)(cid:17)(cid:3)(cid:3)(cid:41)(cid:88)(cid:85)(cid:87)(cid:75)(cid:72)(cid:85)(cid:15)(cid:3)(cid:90)(cid:72)(cid:3)(cid:70)(cid:82)(cid:81)(cid:87)(cid:76)(cid:81)(cid:88)(cid:72)(cid:71)(cid:3)(cid:87)(cid:82)(cid:3)(cid:82)(cid:82)(cid:83)(cid:87)(cid:76)(cid:80)(cid:76)(cid:93)(cid:72)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:73)(cid:82)(cid:82)(cid:87)(cid:83)(cid:85)(cid:76)(cid:81)(cid:87)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:83)(cid:82)(cid:85)(cid:87)(cid:73)(cid:82)(cid:79)(cid:76)(cid:82)(cid:17)(cid:3)(cid:3)
(cid:39)(cid:88)(cid:85)(cid:76)(cid:81)(cid:74)(cid:3)(cid:87)(cid:75)(cid:72) (cid:92)(cid:72)(cid:68)(cid:85)(cid:3)(cid:90)(cid:72)(cid:3)(cid:70)(cid:79)(cid:82)(cid:86)(cid:72)(cid:71)(cid:3)(cid:73)(cid:82)(cid:88)(cid:85) (cid:83)(cid:79)(cid:68)(cid:81)(cid:87)(cid:86)(cid:15)(cid:3)(cid:85)(cid:72)(cid:79)(cid:82)(cid:70)(cid:68)(cid:87)(cid:72)(cid:71)(cid:3)(cid:82)(cid:81)(cid:72)(cid:15)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:82)(cid:83)(cid:83)(cid:72)(cid:81)(cid:72)(cid:71)(cid:3)(cid:68)(cid:3)(cid:69)(cid:85)(cid:68)(cid:81)(cid:71)(cid:16)(cid:81)(cid:72)(cid:90)(cid:3)(cid:75)(cid:76)(cid:74)(cid:75)(cid:79)(cid:92) (cid:83)(cid:85)(cid:82)(cid:71)(cid:88)(cid:70)(cid:87)(cid:76)(cid:89)(cid:72)(cid:3)
(cid:71)(cid:82)(cid:82)(cid:85)(cid:3)(cid:83)(cid:79)(cid:68)(cid:81)(cid:87)(cid:3)(cid:76)(cid:81)(cid:3)(cid:55)(cid:76)(cid:77)(cid:88)(cid:68)(cid:81)(cid:68)(cid:15)(cid:3)(cid:48)(cid:72)(cid:91)(cid:76)(cid:70)(cid:82)(cid:17)(cid:3)(cid:3)(cid:50)(cid:88)(cid:85)(cid:3)(cid:82)(cid:69)(cid:77)(cid:72)(cid:70)(cid:87)(cid:76)(cid:89)(cid:72)(cid:3)(cid:76)(cid:86)(cid:3)(cid:87)(cid:82)(cid:3)(cid:75)(cid:68)(cid:89)(cid:72)(cid:3)(cid:87)(cid:75)(cid:72)(cid:72)(cid:3)(cid:80)(cid:82)(cid:86)(cid:87)(cid:3)(cid:72)(cid:73)(cid:73)(cid:76)(cid:70)(cid:76)(cid:72)(cid:81)(cid:87)(cid:3)(cid:81)(cid:72)(cid:87)(cid:90)(cid:82)(cid:85)(cid:78)(cid:3)(cid:82)(cid:73)(cid:3)(cid:73)(cid:68)(cid:70)(cid:76)(cid:79)(cid:76)(cid:87)(cid:76)(cid:72)(cid:86)(cid:3)
(cid:85)(cid:72)(cid:84)(cid:88)(cid:76)(cid:85)(cid:72)(cid:71)(cid:3)(cid:87)(cid:82)(cid:3)(cid:86)(cid:72)(cid:85)(cid:89)(cid:76)(cid:70)(cid:72)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:70)(cid:88)(cid:86)(cid:87)(cid:82)(cid:80)(cid:72)(cid:85)(cid:86)(cid:3)(cid:68)(cid:85)(cid:82)(cid:88)(cid:81)(cid:71)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:74)(cid:79)(cid:82)(cid:69)(cid:72)(cid:17)(cid:3)(cid:3)(cid:44)(cid:81)(cid:3)(cid:68)(cid:71)(cid:71)(cid:76)(cid:76)(cid:87)(cid:76)(cid:82)(cid:81)(cid:15)(cid:3)(cid:90)(cid:72)(cid:3)(cid:72)(cid:91)(cid:76)(cid:87)(cid:72)(cid:71)(cid:3)(cid:87)(cid:75)(cid:85)(cid:72)(cid:72)(cid:3)(cid:81)(cid:82)(cid:81)(cid:16)(cid:70)(cid:82)(cid:85)(cid:72)
(cid:69)(cid:88)(cid:86)(cid:76)(cid:81)(cid:72)(cid:86)(cid:86)(cid:72)(cid:86)(cid:3)(cid:76)(cid:81)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:56)(cid:46)(cid:3)(cid:86)(cid:72)(cid:74)(cid:80)(cid:72)(cid:81)(cid:87)(cid:17)(cid:3)(cid:3)(cid:3)

(cid:85)(cid:82)(cid:88)(cid:74)(cid:75)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:48)(cid:57)(cid:68)(cid:81)(cid:87)(cid:68)(cid:74)(cid:72)(cid:3)(cid:82)(cid:83)(cid:72)(cid:85)(cid:68)(cid:87)(cid:76)(cid:81)(cid:74)(cid:3)
(cid:86)(cid:86)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:70)(cid:82)(cid:80)(cid:83)(cid:68)(cid:81)(cid:92)(cid:3)(cid:69)(cid:92)(cid:3)(cid:82)(cid:89)(cid:72)(cid:85)(cid:3)(cid:20)(cid:19)(cid:19)(cid:8)

(cid:76)(cid:89)(cid:76)(cid:87)(cid:92)(cid:3)(cid:87)(cid:75)
(cid:87)(cid:86)(cid:3)(cid:68)(cid:70)(cid:85)(cid:82)
(cid:76)(cid:72)(cid:86)

(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)
(cid:883) (cid:4)(cid:134)(cid:140)(cid:151)(cid:149)(cid:150)(cid:135)(cid:134)(cid:3)(cid:8)(cid:5)(cid:12)(cid:23)(cid:7)(cid:4)(cid:3)(cid:143)(cid:131)(cid:148)(cid:137)(cid:139)(cid:144)(cid:3)(cid:139)(cid:149)(cid:3)(cid:134)(cid:135)(cid:136)(cid:139)(cid:144)(cid:135)(cid:134)(cid:3)(cid:131)(cid:149)(cid:3)(cid:4)(cid:134)(cid:140)(cid:151)(cid:149)(cid:150)(cid:135)(cid:134)(cid:3)(cid:8)(cid:5)(cid:12)(cid:23)(cid:7)(cid:4)(cid:3)(cid:134)(cid:139)(cid:152)(cid:139)(cid:134)(cid:135)(cid:134)(cid:3)(cid:132)(cid:155)
(cid:155)
(cid:17)(cid:135)(cid:150)(cid:3)(cid:22)
(cid:486)(cid:14)(cid:3)(cid:136)(cid:145)(cid:148)(cid:3)(cid:150)(cid:138)
(cid:149)(cid:150)(cid:131)(cid:150)(cid:135)(cid:143)(cid:135)(cid:144)(cid:150)(cid:149)(cid:3)(cid:132)(cid:135)(cid:137)(cid:139)(cid:144)(cid:144)(cid:139)(cid:144)(cid:137)(cid:3)(cid:145)(cid:144)(cid:3)(cid:146)(cid:131)(cid:137)(cid:135)(cid:3)(cid:890)(cid:884)(cid:3)(cid:145)(cid:136)(cid:3)(cid:145)(cid:151)(cid:148)(cid:3)(cid:4)(cid:144)(cid:144)(cid:151)(cid:131)(cid:142)(cid:3)(cid:21)(cid:135)(cid:146)(cid:145)(cid:148)(cid:150)(cid:3)(cid:145)(cid:144)(cid:3)(cid:9)(cid:145)(cid:148)(cid:143)(cid:3)(cid:883)(cid:882)
(cid:143)(cid:135)(cid:131)(cid:149)(cid:151)(cid:148)(cid:135)(cid:481)(cid:3)(cid:131)(cid:144)(cid:134)(cid:3)(cid:131)(cid:3)(cid:148)(cid:135)(cid:133)(cid:145)(cid:144)(cid:133)(cid:139)(cid:142)(cid:139)(cid:131)(cid:150)(cid:139)(cid:145)(cid:144)(cid:3)(cid:145)(cid:136)(cid:3)(cid:144)(cid:135)(cid:150)(cid:3)(cid:139)(cid:144)(cid:133)(cid:145)(cid:143)(cid:135)(cid:3)(cid:131)(cid:150)(cid:150)(cid:148)(cid:139)(cid:132)(cid:151)(cid:150)(cid:131)(cid:132)(cid:142)(cid:135)(cid:3)(cid:150)(cid:145)(cid:3)(cid:16)(cid:131)(cid:149)(cid:145)(cid:144)(cid:139)(cid:150)(cid:135)(cid:484)

(cid:131)(cid:142)(cid:135)(cid:149)(cid:484)(cid:3)(cid:3)(cid:22)(cid:135)(cid:135)(cid:3)(cid:17)(cid:145)(cid:150)(cid:135)(cid:3)(cid:883)(cid:889)(cid:3)(cid:150)(cid:145)(cid:3)(cid:145)(cid:151)(cid:148)(cid:3)(cid:133)(cid:145)(cid:144)(cid:149)(cid:145)(cid:142)(cid:139)(cid:134)(cid:131)(cid:150)(cid:135)(cid:134)(cid:3)(cid:136)(cid:139)(cid:144)(cid:131)(cid:144)(cid:133)(cid:139)(cid:131)(cid:142)(cid:3)
(cid:138)(cid:135)(cid:3)(cid:134)(cid:135)(cid:136)(cid:139)(cid:144)(cid:139)(cid:150)(cid:139)(cid:145)(cid:144)(cid:3)(cid:145)(cid:136)(cid:3)(cid:4)(cid:134)(cid:140)(cid:151)(cid:149)(cid:150)(cid:135)(cid:134)(cid:3)(cid:8)(cid:5)(cid:12)(cid:23)(cid:7)(cid:4)(cid:481)(cid:3)(cid:131)(cid:3)(cid:144)(cid:145)(cid:144)(cid:486)(cid:10)(cid:4)(cid:4)(cid:19)(cid:3)

(cid:55)(cid:75)(cid:85)(cid:82)(cid:88)(cid:74)(cid:75)(cid:3)(cid:87)(cid:75)(cid:72)(cid:86)(cid:72)(cid:3)(cid:72)(cid:73)(cid:73)(cid:82)(cid:85)(cid:87)(cid:86)(cid:15)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:70)(cid:82)(cid:80)(cid:83)(cid:68)(cid:81)(cid:92)(cid:3)(cid:71)(cid:72)(cid:79)(cid:76)(cid:89)(cid:72)(cid:85)(cid:72)(cid:71)(cid:3)(cid:76)(cid:80)(cid:83)(cid:85)(cid:82)(cid:89)(cid:72)(cid:71)(cid:3)(cid:73)(cid:76)(cid:81)(cid:68)(cid:81)(cid:70)(cid:76)(cid:68)(cid:79)(cid:3)(cid:85)(cid:72)(cid:86)(cid:88)(cid:79)(cid:87)(cid:86)(cid:3)(cid:76)(cid:81)(cid:3)(cid:21)(cid:19)(cid:20)(cid:28)(cid:17)(cid:3)(cid:3)(cid:58)(cid:72)(cid:3)(cid:85)(cid:72)(cid:83)(cid:82)(cid:85)(cid:87)(cid:72)(cid:71)(cid:3)(cid:81)(cid:72)(cid:87)(cid:3)
(cid:86)(cid:68)(cid:79)(cid:72)(cid:86)(cid:3)(cid:82)(cid:73)(cid:3)(cid:68)(cid:79)(cid:80)(cid:82)(cid:86)(cid:87)(cid:3)(cid:7)(cid:21)(cid:17)(cid:21)(cid:3)(cid:69)(cid:76)(cid:79)(cid:79)(cid:76)(cid:82)(cid:81)(cid:15)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:70)(cid:82)(cid:81)(cid:86)(cid:82)(cid:79)(cid:76)(cid:71)(cid:68)(cid:87)(cid:72)(cid:71)(cid:3)(cid:74)(cid:85)(cid:82)(cid:86)(cid:86)(cid:3)(cid:83)(cid:85)(cid:82)(cid:73)(cid:76)(cid:87)
(cid:87)
(cid:3)(cid:80)(cid:80)(cid:68)(cid:85)(cid:74)(cid:76)(cid:81)(cid:3)(cid:76)(cid:80)(cid:83)(cid:85)(cid:82)(cid:89)(cid:72)(cid:71)(cid:3)(cid:80)(cid:72)(cid:68)(cid:81)(cid:76)(cid:81)(cid:74)(cid:73)(cid:88)(cid:79)(cid:79)(cid:92)(cid:3)(cid:71)(cid:72)(cid:86)(cid:83)(cid:76)(cid:87)(cid:72)(cid:3)
(cid:88)(cid:81)(cid:83)(cid:79)(cid:68)(cid:81)(cid:81)(cid:72)(cid:71)(cid:3)(cid:87)(cid:68)(cid:85)(cid:76)(cid:73)(cid:73)(cid:86)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:68)(cid:3)(cid:80)(cid:82)(cid:71)(cid:72)(cid:85)(cid:68)(cid:87)(cid:72)(cid:79)(cid:92)(cid:3)(cid:76)(cid:81)(cid:73)(cid:79)(cid:68)(cid:87)(cid:76)(cid:82)(cid:81)(cid:68)(cid:85)(cid:92)(cid:3)(cid:72)(cid:81)(cid:89)(cid:76)(cid:85)(cid:82)(cid:81)(cid:80)(cid:72)(cid:81)(cid:87)(cid:15)(cid:3)(cid:68)(cid:86)(cid:86)(cid:3)(cid:68)(cid:3)(cid:85)(cid:72)(cid:86)(cid:88)(cid:79)(cid:87)(cid:3)(cid:82)(cid:73)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:83)(cid:85)(cid:76)(cid:70)(cid:76)(cid:81)(cid:74)(cid:15)(cid:3)(cid:83)(cid:85)(cid:82)(cid:71)(cid:88)(cid:70)(cid:87)(cid:76)(cid:89)(cid:76)(cid:87)(cid:92)(cid:15)(cid:3)
(cid:68)(cid:81)(cid:71)(cid:3)(cid:83)(cid:82)(cid:85)(cid:87)(cid:73)(cid:82)(cid:79)(cid:76)(cid:82)(cid:3)(cid:76)(cid:81)(cid:76)(cid:87)(cid:76)(cid:68)(cid:87)(cid:76)(cid:89)(cid:72)(cid:86)(cid:17)(cid:3)(cid:3)(cid:36)(cid:71)(cid:77)(cid:88)(cid:86)(cid:87)(cid:72)(cid:71)(cid:3)(cid:40)(cid:37)(cid:44)(cid:55)(cid:39)(cid:36)(cid:20)(cid:3)(cid:76)(cid:81)(cid:70)(cid:85)(cid:72)(cid:68)(cid:86)(cid:72)(cid:71)(cid:3)(cid:25)(cid:8)(cid:3)(cid:87)(cid:82)(cid:3)(cid:7)(cid:7)(cid:21)(cid:27)(cid:22)(cid:3)(cid:80)(cid:76)(cid:79)(cid:79)(cid:76)(cid:82)(cid:81)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:90)(cid:72)(cid:3)(cid:71)(cid:72)(cid:79)(cid:76)(cid:89)(cid:72)(cid:85)(cid:72)(cid:71)(cid:3)(cid:68)(cid:81)(cid:82)(cid:87)(cid:75)(cid:72)(cid:85)(cid:3)
(cid:92)(cid:72)(cid:68)(cid:85)(cid:3)(cid:82)(cid:73)(cid:3)(cid:86)(cid:87)(cid:85)(cid:82)(cid:81)(cid:74)(cid:3)(cid:73)(cid:85)(cid:72)(cid:72)(cid:3)(cid:70)(cid:68)(cid:86)(cid:75)(cid:3)(cid:73)(cid:79)(cid:82)(cid:90)(cid:17)(cid:21) (cid:3)(cid:41)(cid:76)(cid:81)(cid:68)(cid:79)(cid:79)(cid:92)(cid:15)(cid:3)(cid:90)(cid:72)(cid:3)(cid:85)(cid:72)(cid:87)(cid:88)(cid:85)(cid:81)(cid:72)(cid:71)(cid:3)(cid:70)(cid:68)(cid:83)(cid:76)(cid:87)(cid:68)(cid:79)(cid:3)(cid:87)(cid:82)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:86)(cid:75)(cid:68)(cid:85)(cid:72)(cid:75)(cid:82)(cid:79)(cid:71)(cid:72)(cid:85)(cid:86)(cid:3)(cid:69)(cid:92)(cid:3)(cid:69)(cid:88)(cid:92)(cid:76)(cid:81)(cid:74)(cid:3)(cid:69)(cid:68)(cid:70)(cid:78)(cid:3)(cid:68)(cid:79)(cid:80)(cid:82)(cid:86)(cid:87)(cid:3)
(cid:20)(cid:17)(cid:21)(cid:3)(cid:80)(cid:76)(cid:79)(cid:79)(cid:76)(cid:82)(cid:81)(cid:3)(cid:86)(cid:75)(cid:68)(cid:85)(cid:72)(cid:86)(cid:3)(cid:82)(cid:73)(cid:3)(cid:48)(cid:68)(cid:86)(cid:82)(cid:81)(cid:76)(cid:87)(cid:72)(cid:3)(cid:86)(cid:87)(cid:82)(cid:70)(cid:78)(cid:3)(cid:73)(cid:82)(cid:85)(cid:3)(cid:68)(cid:83)(cid:83)(cid:85)(cid:82)(cid:91)(cid:76)(cid:80)(cid:68)(cid:87)(cid:72)(cid:79)(cid:92)(cid:3)(cid:7)(cid:25)(cid:19)(cid:3)(cid:80)(cid:76)(cid:79)(cid:79)(cid:79)(cid:76)(cid:82)(cid:81)(cid:17)(cid:3)(cid:3)(cid:54)(cid:76)(cid:81)(cid:70)(cid:72)(cid:3)(cid:90)(cid:72)(cid:3)(cid:76)(cid:81)(cid:76)(cid:87)(cid:76)(cid:68)(cid:87)(cid:72)(cid:71)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:86)(cid:75)(cid:68)(cid:85)(cid:72)(cid:3)
(cid:85)(cid:72)(cid:83)(cid:88)(cid:85)(cid:70)(cid:75)(cid:68)(cid:86)(cid:72)(cid:3)(cid:83)(cid:85)(cid:82)(cid:74)(cid:85)(cid:68)(cid:80)(cid:3)(cid:76)(cid:81)(cid:3)(cid:21)(cid:19)(cid:20)(cid:25)(cid:15)(cid:3)(cid:90)(cid:72)(cid:3)(cid:75)(cid:68)(cid:89)(cid:72)(cid:3)(cid:85)(cid:72)(cid:83)(cid:88)(cid:85)(cid:70)(cid:75)(cid:68)(cid:86)(cid:72)(cid:71)(cid:3)(cid:81)(cid:72)(cid:68)(cid:85)(cid:79)(cid:92)(cid:3)(cid:21)(cid:24)(cid:8)(cid:3)(cid:82)(cid:73)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:86)(cid:87)(cid:82)(cid:70)(cid:78)(cid:17)(cid:3)

(cid:85)

(cid:58)(cid:72)(cid:3)(cid:76)(cid:80)(cid:83)(cid:85)(cid:82)(cid:89)(cid:72)(cid:71)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:70)(cid:68)(cid:83)(cid:76)(cid:87)(cid:68)(cid:79)(cid:3)(cid:86)(cid:87)(cid:85)(cid:88)(cid:70)(cid:87)(cid:88)(cid:85)(cid:72)(cid:3)(cid:82)(cid:73)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:70)(cid:82)(cid:80)(cid:83)(cid:68)(cid:81)(cid:92)(cid:3)(cid:69)(cid:92)(cid:3)(cid:76)(cid:86)(cid:86)(cid:88)(cid:76)(cid:81)(cid:74)(cid:3)(cid:7)(cid:24)(cid:19)(cid:19)(cid:3)(cid:80)(cid:76)(cid:79)(cid:79)(cid:76)(cid:82)(cid:81)(cid:3)(cid:82)(cid:73)(cid:3)(cid:81)(cid:72)(cid:90)(cid:3)(cid:69)(cid:82)(cid:81)(cid:71)(cid:86)(cid:3)(cid:76)(cid:81)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:87)(cid:75)(cid:76)(cid:85)(cid:71)(cid:3)
(cid:84)(cid:88)(cid:68)(cid:85)(cid:87)(cid:72)(cid:85)(cid:3)(cid:87)(cid:82)(cid:3)(cid:85)(cid:72)(cid:73)(cid:76)(cid:81)(cid:68)(cid:81)(cid:70)(cid:72)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:72)(cid:91)(cid:76)(cid:86)(cid:87)(cid:76)(cid:81)(cid:74)(cid:3)(cid:81)(cid:82)(cid:87)(cid:72)(cid:86)(cid:3)(cid:87)(cid:75)(cid:68)(cid:87)(cid:3)(cid:90)(cid:72)(cid:85)(cid:72)(cid:3)(cid:71)(cid:88)(cid:72)(cid:3)(cid:76)(cid:81)(cid:3)(cid:21)(cid:19)(cid:21)(cid:22)(cid:17)(cid:3)(cid:3)(cid:55)(cid:55)(cid:75)(cid:76)(cid:86)(cid:3)(cid:90)(cid:68)(cid:86)(cid:3)(cid:68)(cid:3)(cid:74)(cid:85)(cid:72)(cid:68)(cid:87)(cid:3)(cid:82)(cid:83)(cid:83)(cid:82)(cid:85)(cid:87)(cid:88)(cid:81)(cid:76)(cid:87)(cid:92)(cid:3)(cid:87)(cid:82)(cid:3)(cid:73)(cid:88)(cid:85)(cid:87)(cid:75)(cid:72)(cid:85)(cid:3)
(cid:72)(cid:91)(cid:87)(cid:72)(cid:81)(cid:71)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:71)(cid:72)(cid:69)(cid:87)(cid:3)(cid:80)(cid:68)(cid:87)(cid:88)(cid:85)(cid:76)(cid:87)(cid:76)(cid:72)(cid:86)(cid:3)(cid:68)(cid:87)(cid:3)(cid:68)(cid:3)(cid:85)(cid:72)(cid:71)(cid:88)(cid:70)(cid:72)(cid:71)(cid:3)(cid:70)(cid:82)(cid:88)(cid:83)(cid:82)(cid:81)(cid:3)(cid:85)(cid:68)(cid:87)(cid:72)(cid:3)(cid:90)(cid:76)(cid:87)(cid:75)(cid:3)(cid:81)(cid:82)(cid:3)(cid:76)(cid:80)(cid:83)(cid:83)(cid:68)(cid:70)(cid:87)(cid:3)(cid:87)(cid:82)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:82)(cid:89)(cid:72)(cid:85)(cid:68)(cid:79)(cid:79)(cid:3)(cid:79)(cid:72)(cid:89)(cid:72)(cid:85)(cid:68)(cid:74)(cid:72)(cid:17)(cid:3)(cid:3)(cid:58)(cid:72)(cid:3)(cid:68)(cid:85)(cid:72)(cid:3)
(cid:83)(cid:79)(cid:72)(cid:68)(cid:86)(cid:72)(cid:71)(cid:3)(cid:90)(cid:76)(cid:87)(cid:75)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:83)(cid:82)(cid:86)(cid:76)(cid:87)(cid:76)(cid:82)(cid:81)(cid:3)(cid:82)(cid:73)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:69)(cid:68)(cid:79)(cid:68)(cid:81)(cid:70)(cid:72)(cid:3)(cid:86)(cid:75)(cid:72)(cid:72)(cid:87)(cid:3)(cid:68)(cid:86)(cid:3)(cid:90)(cid:72)(cid:3)(cid:72)(cid:81)(cid:87)(cid:72)(cid:85)(cid:3)(cid:21)(cid:19)(cid:21)(cid:19)(cid:19)(cid:17)(cid:3)(cid:3)(cid:3)

(cid:44)(cid:3)(cid:68)(cid:80)(cid:3)(cid:68)(cid:79)(cid:86)(cid:82)(cid:3)(cid:83)(cid:79)(cid:72)(cid:68)(cid:86)(cid:72)(cid:71)(cid:3)(cid:87)(cid:75)(cid:68)(cid:87)(cid:3)(cid:76)(cid:81)(cid:3)(cid:21)(cid:19)(cid:20)(cid:28)(cid:3)(cid:90)(cid:72)(cid:3)(cid:83)(cid:88)(cid:69)(cid:79)(cid:76)(cid:86)(cid:75)(cid:72)(cid:71)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:76)(cid:81)(cid:68)(cid:88)(cid:74)(cid:88)(cid:85)(cid:68)(cid:79)(cid:3)(cid:38)(cid:82)(cid:85)(cid:83)(cid:83)(cid:82)(cid:85)(cid:68)(cid:87)(cid:72)(cid:3)(cid:53)(cid:72)(cid:86)(cid:83)(cid:82)(cid:81)(cid:86)(cid:76)(cid:69)(cid:76)(cid:79)(cid:76)(cid:87)(cid:76)(cid:72)(cid:86)(cid:3)(cid:43)(cid:76)(cid:74)(cid:75)(cid:79)(cid:76)(cid:74)(cid:75)(cid:87)(cid:86)(cid:3)
(cid:53)(cid:72)(cid:83)(cid:82)(cid:85)(cid:87)(cid:17)(cid:3)(cid:3)(cid:36)(cid:86)(cid:3)(cid:68)(cid:3)(cid:70)(cid:82)(cid:80)(cid:83)(cid:68)(cid:81)(cid:92)(cid:3)(cid:87)(cid:75)(cid:68)(cid:87)(cid:3)(cid:90)(cid:68)(cid:86)(cid:3)(cid:73)(cid:82)(cid:88)(cid:81)(cid:71)(cid:72)(cid:71)(cid:3)(cid:28)(cid:24)(cid:3)(cid:92)(cid:72)(cid:68)(cid:85)(cid:86)(cid:3)(cid:68)(cid:74)(cid:82)(cid:3)(cid:69)(cid:72)(cid:70)(cid:68)(cid:88)(cid:86)(cid:72)(cid:3)(cid:82)(cid:73)(cid:3)(cid:82)(cid:81)(cid:72)(cid:3)(cid:83)(cid:72)(cid:85)(cid:86)(cid:82)(cid:81)(cid:182)(cid:86)(cid:3)(cid:71)(cid:72)(cid:86)(cid:76)(cid:85)(cid:72)(cid:3)(cid:87)(cid:82)(cid:3)(cid:87)(cid:88)(cid:85)(cid:81)(cid:3)(cid:90)(cid:68)(cid:86)(cid:87)(cid:72)(cid:3)
(cid:90)(cid:82)(cid:82)(cid:71)(cid:3)(cid:73)(cid:85)(cid:82)(cid:80)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:79)(cid:88)(cid:80)(cid:69)(cid:72)(cid:85)(cid:3)(cid:76)(cid:81)(cid:71)(cid:88)(cid:86)(cid:87)(cid:85)(cid:92)(cid:3)(cid:76)(cid:81)(cid:87)(cid:82)(cid:3)(cid:86)(cid:82)(cid:80)(cid:72)(cid:87)(cid:75)(cid:76)(cid:81)(cid:74)(cid:3)(cid:82)(cid:73)(cid:3)(cid:89)(cid:68)(cid:79)(cid:88)(cid:72)(cid:15)(cid:3)(cid:90)(cid:72)(cid:3)(cid:75)(cid:68)(cid:89)(cid:89)(cid:72)(cid:3)(cid:68)(cid:3)(cid:79)(cid:82)(cid:81)(cid:74)(cid:3)(cid:75)(cid:76)(cid:86)(cid:87)(cid:82)(cid:85)(cid:92)(cid:3)(cid:82)(cid:73)(cid:3)(cid:72)(cid:81)(cid:89)(cid:76)(cid:85)(cid:82)(cid:81)(cid:80)(cid:72)(cid:81)(cid:87)(cid:68)(cid:79)(cid:3)
(cid:86)(cid:88)(cid:86)(cid:87)(cid:68)(cid:76)(cid:81)(cid:68)(cid:69)(cid:76)(cid:79)(cid:76)(cid:87)(cid:92)(cid:17)(cid:3)(cid:3)(cid:39)(cid:85)(cid:76)(cid:89)(cid:72)(cid:81)(cid:3)(cid:69)(cid:92)(cid:3)(cid:87)(cid:75)(cid:76)(cid:86)(cid:3)(cid:75)(cid:76)(cid:86)(cid:87)(cid:82)(cid:85)(cid:92)(cid:15)(cid:3)(cid:70)(cid:82)(cid:88)(cid:83)(cid:79)(cid:72)(cid:71)(cid:3)(cid:90)(cid:76)(cid:87)(cid:75)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:72)(cid:89)(cid:72)(cid:85)(cid:16)(cid:76)(cid:81)(cid:70)(cid:70)(cid:85)(cid:72)(cid:68)(cid:86)(cid:76)(cid:81)(cid:74)(cid:3)(cid:73)(cid:82)(cid:70)(cid:88)(cid:86)(cid:3)(cid:73)(cid:85)(cid:82)(cid:80)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:78)(cid:72)(cid:92)(cid:3)
(cid:86)(cid:87)(cid:68)(cid:78)(cid:72)(cid:75)(cid:82)(cid:79)(cid:71)(cid:72)(cid:85)(cid:86)(cid:3)(cid:82)(cid:81)(cid:3)(cid:70)(cid:82)(cid:85)(cid:83)(cid:82)(cid:85)(cid:68)(cid:87)(cid:72)(cid:3)(cid:72)(cid:81)(cid:89)(cid:76)(cid:85)(cid:82)(cid:81)(cid:80)(cid:72)(cid:81)(cid:87)(cid:68)(cid:79)(cid:15)(cid:3)(cid:86)(cid:82)(cid:70)(cid:76)(cid:68)(cid:79)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:74)(cid:82)(cid:89)(cid:72)(cid:85)(cid:81)(cid:68)(cid:81)(cid:70) (cid:11)(cid:40)(cid:54)(cid:42)(cid:12)(cid:3)(cid:72)(cid:73)(cid:73)(cid:82)(cid:85)(cid:87)(cid:86)(cid:15)(cid:3)(cid:90)(cid:72)(cid:3)(cid:73)(cid:72)(cid:79)(cid:87)(cid:3)(cid:76)(cid:87)(cid:3)(cid:90)(cid:68)(cid:86)(cid:3)
(cid:72)(cid:3)
(cid:87)(cid:82)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:69)(cid:88)(cid:86)(cid:76)(cid:81)(cid:72)(cid:86)(cid:86)(cid:17)(cid:3)(cid:3)(cid:58)(cid:72)(cid:3)(cid:68)(cid:85)(cid:72)(cid:3)(cid:70)(cid:82)(cid:80)(cid:80)(cid:76)(cid:87)(cid:87)(cid:72)(cid:71)(cid:3)
(cid:76)(cid:80)(cid:83)(cid:82)(cid:85)(cid:87)(cid:68)(cid:81)(cid:87)(cid:3)(cid:87)(cid:82)(cid:3)(cid:86)(cid:88)(cid:80)(cid:80)(cid:68)(cid:85)(cid:76)(cid:93)(cid:72)(cid:3)(cid:75)(cid:82)(cid:90)(cid:3)(cid:90)(cid:72)(cid:3)(cid:76)(cid:81)(cid:87)(cid:72)(cid:74)(cid:85)(cid:68)(cid:87)(cid:72)(cid:3)(cid:87)(cid:75)(cid:72)(cid:86)(cid:72)(cid:3)(cid:70)(cid:82)(cid:81)(cid:86)(cid:76)(cid:71)(cid:72)(cid:85)(cid:68)(cid:87)(cid:76)(cid:82)(cid:81)(cid:86)(cid:3)
(cid:76)(cid:81)
(cid:87)(cid:82)(cid:3)(cid:72)(cid:81)(cid:75)(cid:68)(cid:81)(cid:70)(cid:76)(cid:81)(cid:74)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:72)(cid:73)(cid:73)(cid:82)(cid:85)(cid:87)(cid:86)(cid:3)(cid:76)(cid:81)(cid:3)(cid:87)(cid:75)(cid:76)(cid:86)(cid:3)(cid:68)(cid:85)(cid:72)(cid:68)(cid:3)(cid:74)(cid:82)(cid:76)(cid:81)(cid:74)(cid:3)(cid:73)(cid:82)(cid:85)(cid:90)(cid:68)(cid:85)(cid:71)(cid:3)(cid:68)(cid:86)(cid:3)(cid:90)(cid:72)(cid:3)(cid:69)(cid:72)(cid:79)(cid:76)(cid:72)(cid:89)(cid:72)(cid:3)(cid:87)(cid:75)(cid:68)(cid:87)(cid:3)(cid:83)(cid:85)(cid:82)(cid:87)(cid:72)(cid:70)(cid:87)(cid:76)(cid:81)(cid:74)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:72)(cid:81)(cid:89)(cid:76)(cid:85)(cid:82)(cid:81)(cid:80)(cid:72)(cid:81)(cid:87)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)
(cid:89)
(cid:83)(cid:85)(cid:82)(cid:89)(cid:76)(cid:71)(cid:76)(cid:81)(cid:74)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:72)(cid:80)(cid:83)(cid:79)(cid:82)(cid:92)(cid:72)(cid:72)(cid:86)(cid:3)(cid:90)(cid:76)(cid:87)(cid:75)(cid:3)(cid:68)(cid:3)(cid:74)(cid:85)(cid:72)(cid:68)(cid:87)(cid:3)(cid:83)(cid:79)(cid:68)(cid:70)(cid:72)(cid:3)(cid:87)(cid:82)(cid:3)(cid:90)(cid:82)(cid:85)(cid:78)(cid:3)(cid:68)(cid:85)(cid:72)(cid:3)(cid:70)(cid:85)(cid:76)(cid:87)(cid:76)(cid:70)(cid:68)(cid:79) (cid:87)(cid:82)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:86)(cid:88)(cid:70)(cid:70)(cid:72)(cid:86)(cid:86)(cid:17)(cid:3)

(cid:50)(cid:88)(cid:85)(cid:3)(cid:83)(cid:88)(cid:85)(cid:83)(cid:82)(cid:86)(cid:72)(cid:3)(cid:76)(cid:86)(cid:3)(cid:70)(cid:79)(cid:72)(cid:68)(cid:85)(cid:15)(cid:3)(cid:90)(cid:72)(cid:3)(cid:75)(cid:72)(cid:79)(cid:83)(cid:3)(cid:83)(cid:72)(cid:82)(cid:83)(cid:79)(cid:72)(cid:3)(cid:90)(cid:68)(cid:79)(cid:78)(cid:3)(cid:87)(cid:75)(cid:85)(cid:82)(cid:88)(cid:74)(cid:75)(cid:3)(cid:90)(cid:68)(cid:79)(cid:79)(cid:86)(cid:86)(cid:80)
(cid:72)(cid:3)(cid:71)(cid:82)(cid:3)(cid:86)(cid:82)(cid:3)(cid:83)(cid:75)(cid:92)(cid:86)(cid:76)(cid:70)(cid:68)(cid:79)(cid:79)(cid:92)(cid:3)(cid:69)(cid:92)(cid:3)(cid:82)(cid:73)(cid:73)(cid:72)(cid:85)(cid:76)(cid:81)(cid:74)(cid:3)(cid:74)(cid:85)(cid:72)(cid:68)(cid:87)(cid:3)
(cid:71)(cid:82)(cid:82)(cid:85)(cid:86)(cid:15)(cid:3)(cid:90)(cid:76)(cid:87)(cid:75)(cid:3)(cid:75)(cid:88)(cid:81)(cid:71)(cid:85)(cid:72)(cid:71)(cid:86)(cid:3)(cid:82)(cid:73)(cid:3)(cid:80)(cid:76)(cid:79)(cid:79)(cid:76)(cid:82)(cid:81)(cid:86) (cid:82)(cid:73)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:71)(cid:82)(cid:82)(cid:85)(cid:86)(cid:3)(cid:76)(cid:81)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:80)(cid:68)(cid:85)(cid:78)(cid:72)(cid:87)(cid:3)(cid:87)(cid:82)(cid:71)(cid:68)(cid:92)(cid:15)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:80)(cid:72)(cid:87)(cid:68)(cid:83)(cid:75)(cid:82)(cid:85)(cid:76)(cid:70)(cid:68)(cid:79)(cid:79)(cid:92)(cid:3)(cid:87)(cid:75)(cid:85)(cid:82)(cid:88)(cid:74)(cid:75)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)
(cid:76)(cid:72)(cid:86)
(cid:70)(cid:88)(cid:79)(cid:87)(cid:88)(cid:85)(cid:72)(cid:15)(cid:3)(cid:69)(cid:92)(cid:3)(cid:75)(cid:72)(cid:79)(cid:83)(cid:76)(cid:81)(cid:74)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:72)(cid:80)(cid:83)(cid:79)(cid:82)(cid:92)(cid:72)(cid:72)(cid:86)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:83)(cid:72)(cid:82)(cid:83)(cid:79)(cid:72)(cid:3)(cid:76)(cid:81)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:70)(cid:82)(cid:80)(cid:80)(cid:88)(cid:81)(cid:76)(cid:87)(cid:76)
(cid:3)(cid:90)(cid:72)(cid:3)(cid:82)(cid:83)(cid:72)(cid:85)(cid:68)(cid:87)(cid:72)(cid:3)(cid:71)(cid:82)(cid:3)(cid:87)(cid:75)(cid:76)(cid:81)(cid:74)(cid:86)(cid:3)(cid:87)(cid:75)(cid:72)(cid:92)(cid:3)(cid:80)(cid:76)(cid:74)(cid:75)(cid:87)(cid:3)
(cid:81)(cid:72)(cid:89)(cid:72)(cid:85)(cid:3)(cid:75)(cid:68)(cid:89)(cid:72)(cid:3)(cid:87)(cid:75)(cid:82)(cid:88)(cid:74)(cid:75)(cid:87)(cid:3)(cid:83)(cid:82)(cid:86)(cid:86)(cid:76)(cid:69)(cid:79)(cid:72)(cid:17)(cid:3)(cid:3)(cid:58)
(cid:82)(cid:86)
(cid:72)(cid:3)(cid:69)(cid:72)(cid:79)(cid:76)(cid:72)(cid:89)(cid:72)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:70)(cid:88)(cid:79)(cid:87)(cid:88)(cid:85)(cid:72)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:83)(cid:88)(cid:85)(cid:83)(cid:82) (cid:72)(cid:3)(cid:70)(cid:82)(cid:81)(cid:87)(cid:85)(cid:76)(cid:69)(cid:88)(cid:87)(cid:72)(cid:71)(cid:3)(cid:87)(cid:82)(cid:3)(cid:76)(cid:80)(cid:83)(cid:85)(cid:82)(cid:89)(cid:72)(cid:71)(cid:3)(cid:72)(cid:80)(cid:83)(cid:79)(cid:82)(cid:92)(cid:72)(cid:72)(cid:3)
(cid:72)(cid:81)(cid:74)(cid:68)(cid:74)(cid:72)(cid:80)(cid:72)(cid:81)(cid:87)(cid:3)(cid:86)(cid:70)(cid:82)(cid:85)(cid:72)(cid:86)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:86)(cid:76)(cid:74)(cid:81)(cid:76)(cid:73)(cid:76)(cid:70)(cid:68)(cid:81)(cid:87)(cid:79)(cid:92)(cid:3)(cid:85)(cid:72)(cid:71)(cid:88)(cid:70)(cid:72)(cid:71)(cid:3)(cid:87)(cid:88)(cid:85)(cid:81)(cid:82)(cid:89)(cid:72)(cid:85)(cid:3)(cid:76)(cid:81)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:69)(cid:88) (cid:76)(cid:81)(cid:72)(cid:86)(cid:86)(cid:3)(cid:76)(cid:81)(cid:3)(cid:21)(cid:19)(cid:20)(cid:28)(cid:17)(cid:3)(cid:3)(cid:55)(cid:75)(cid:72)(cid:3)(cid:72)(cid:81)(cid:74)(cid:68)(cid:74)(cid:72)(cid:80)(cid:72)(cid:81)(cid:87)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)
(cid:88)(cid:86)
(cid:70)(cid:82)(cid:81)(cid:87)(cid:76)(cid:81)(cid:88)(cid:76)(cid:87)(cid:92)(cid:3)(cid:82)(cid:73)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:87)(cid:72)(cid:68)(cid:80)(cid:3)(cid:68)(cid:85)(cid:72)(cid:3)(cid:78)(cid:72)(cid:92)(cid:3)(cid:71)(cid:85)(cid:76)(cid:89)(cid:72)(cid:85)(cid:86)(cid:3)(cid:87)(cid:82)(cid:3)(cid:71)(cid:72)(cid:79)(cid:76)(cid:89)(cid:72)(cid:85)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:74)(cid:82)(cid:68)(cid:79)(cid:86)(cid:17)(cid:3)

(cid:17)(cid:3)(cid:3)(cid:58)(cid:72)

(cid:44)(cid:3)(cid:68)(cid:80)(cid:3)(cid:83)(cid:85)(cid:82)(cid:88)(cid:71)(cid:3)(cid:87)(cid:82)(cid:3)(cid:69)(cid:72)(cid:3)(cid:79)(cid:72)(cid:68)(cid:71)(cid:76)(cid:81)(cid:74)(cid:3)(cid:48)(cid:68)(cid:86)(cid:82)(cid:81)(cid:76)(cid:87)(cid:72)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:90)(cid:76)(cid:79)(cid:79)(cid:3)(cid:90)(cid:82)(cid:85)(cid:78)(cid:3)(cid:75)(cid:68)(cid:85)(cid:71)(cid:3)(cid:87)(cid:82)(cid:3)(cid:76)(cid:81)(cid:70)(cid:85)(cid:72)(cid:68) (cid:72)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:80)(cid:82)(cid:80)(cid:72)(cid:81)(cid:87)(cid:88)(cid:80)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:83)(cid:85)(cid:82)(cid:74)(cid:85)(cid:72)(cid:86)(cid:86)(cid:3)(cid:87)(cid:75)(cid:68)(cid:87)(cid:3)
(cid:41)(cid:85)(cid:72)(cid:71)(cid:3)(cid:47)(cid:92)(cid:81)(cid:70)(cid:75)(cid:3)(cid:71)(cid:85)(cid:82)(cid:89)(cid:72)(cid:3)(cid:71)(cid:88)(cid:85)(cid:76)(cid:81)(cid:74)(cid:3)(cid:75)(cid:76)(cid:86)(cid:3)(cid:81)(cid:72)(cid:68)(cid:85)(cid:79)(cid:92)(cid:3)(cid:20)(cid:22)(cid:3)(cid:92)(cid:72)(cid:68)(cid:85)(cid:86)(cid:3)(cid:68)(cid:87)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:75)(cid:72)(cid:79)(cid:80)(cid:17)(cid:3)(cid:3)(cid:44)(cid:3)(cid:90)(cid:82)(cid:88)(cid:79)(cid:71)(cid:3)(cid:79)(cid:76)(cid:78)(cid:72)(cid:3)(cid:87)(cid:82)(cid:3)(cid:87)(cid:75)(cid:68)(cid:81)(cid:78)(cid:3)(cid:75)(cid:76)(cid:80)(cid:3)(cid:73)(cid:82)(cid:85)(cid:3)(cid:75)(cid:76)(cid:86)(cid:3)(cid:71)(cid:72)(cid:71)(cid:76)(cid:70)(cid:68)(cid:87)(cid:72)(cid:71)(cid:3)
(cid:86)(cid:72)(cid:85)(cid:89)(cid:76)(cid:70)(cid:72)(cid:15)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:87)(cid:75)(cid:68)(cid:81)(cid:78)(cid:3)(cid:72)(cid:68)(cid:70)(cid:75)(cid:3)(cid:82)(cid:73)(cid:3)(cid:92)(cid:82)(cid:88)(cid:3)(cid:73)(cid:82)(cid:85)(cid:3)(cid:92)(cid:82)(cid:88)(cid:85)(cid:3)(cid:87)(cid:85)(cid:88)(cid:86)(cid:87)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:86)(cid:88)(cid:83)(cid:83)(cid:82)(cid:85)(cid:87)(cid:3)(cid:68)(cid:86)(cid:3)(cid:78)(cid:72)(cid:92)(cid:3)(cid:86)(cid:87)(cid:68)(cid:78)(cid:72)(cid:75)(cid:82)(cid:79)(cid:71)(cid:72)(cid:85)(cid:86)(cid:3)(cid:82)(cid:73)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:70)(cid:82)(cid:80)(cid:83)(cid:68)(cid:81)(cid:92)(cid:17)(cid:3)(cid:3)(cid:44)(cid:3)(cid:68)(cid:80)(cid:3)
(cid:72)(cid:91)(cid:70)(cid:76)(cid:87)(cid:72)(cid:71)(cid:3)(cid:73)(cid:82)(cid:85)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:73)(cid:88)(cid:87)(cid:88)(cid:85)(cid:72)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:79)(cid:82)(cid:82)(cid:78)(cid:3)(cid:73)(cid:82)(cid:85)(cid:90)(cid:68)(cid:85)(cid:71)(cid:3)(cid:87)(cid:82)(cid:3)(cid:179)(cid:82)(cid:83)(cid:72)(cid:81)(cid:76)(cid:81)(cid:74)(cid:3)(cid:81)(cid:72)(cid:90)(cid:3)(cid:71)(cid:82)(cid:82)(cid:85)(cid:86)(cid:180)(cid:180)(cid:3)(cid:73)(cid:82)(cid:85)(cid:3)(cid:82)(cid:88)(cid:85)(cid:3)(cid:70)(cid:88)(cid:86)(cid:87)(cid:82)(cid:80)(cid:72)(cid:85)(cid:86)(cid:15)(cid:3)(cid:83)(cid:68)(cid:85)(cid:87)(cid:81)(cid:72)(cid:85)(cid:86)(cid:15)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)
(cid:72)(cid:80)(cid:83)(cid:79)(cid:82)(cid:92)(cid:72)(cid:72)(cid:86)(cid:17)(cid:3)

(cid:68)(cid:86)
(cid:88)
(cid:92)

(cid:43)(cid:82)(cid:90)(cid:68)(cid:85)(cid:71)(cid:3)(cid:38)(cid:17)(cid:3)(cid:43)(cid:72)(cid:70)(cid:78)(cid:72)(cid:86)(cid:3)
(cid:51)(cid:85)(cid:72)(cid:86)(cid:76)(cid:71)(cid:72)(cid:81)(cid:87)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:38)(cid:75)(cid:76)(cid:72)(cid:73)(cid:3)(cid:40)(cid:91)(cid:72)(cid:70)(cid:88)(cid:87)(cid:76)(cid:89)(cid:72)(cid:3)(cid:50)(cid:73)(cid:73)(cid:76)(cid:70)(cid:72)(cid:85)(cid:3)
(cid:48)(cid:68)(cid:86)(cid:82)(cid:81)(cid:76)(cid:87)(cid:72)(cid:3)(cid:44)(cid:81)(cid:87)(cid:72)(cid:85)(cid:81)(cid:68)(cid:87)(cid:76)(cid:82)(cid:81)(cid:68)(cid:79)(cid:3)(cid:38)(cid:82)(cid:85)(cid:83)(cid:82)(cid:85)(cid:68)(cid:87)(cid:76)(cid:82)(cid:81)(cid:3)
(cid:26)(cid:15) (cid:19) (cid:19)
(cid:48)(cid:68)(cid:85)(cid:70)(cid:75)(cid:3)(cid:21)(cid:26)(cid:15) (cid:21)(cid:19)(cid:21)(cid:19)(cid:3)

(cid:68) (cid:70)

(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)
(cid:884)(cid:3)(cid:9)(cid:148)(cid:135)(cid:135)(cid:3)(cid:133)(cid:131)(cid:149)(cid:138)(cid:3)(cid:136)(cid:142)(cid:145)(cid:153)(cid:3)(cid:139)(cid:149)(cid:3)(cid:131)(cid:3)(cid:144)(cid:145)(cid:144)(cid:486)(cid:10)(cid:4)(cid:4)(cid:19)(cid:3)(cid:136)(cid:139)(cid:144)(cid:131)(cid:144)(cid:133)(cid:139)(cid:131)(cid:142)(cid:3)(cid:143)(cid:135)(cid:131)(cid:149)(cid:151)(cid:148)(cid:135)(cid:3)(cid:133)(cid:131)(cid:142)(cid:133)(cid:151)(cid:142)(cid:131)(cid:150)(cid:135)(cid:134)(cid:3)(cid:132)(cid:155)(cid:3)(cid:149)
(cid:133)(cid:131)(cid:149)(cid:138)(cid:3)(cid:136)(cid:142)(cid:145)(cid:153)(cid:3)(cid:146)(cid:148)(cid:145)(cid:152)(cid:139)(cid:134)(cid:135)(cid:134)(cid:3)(cid:132)(cid:155)(cid:3)(cid:145)(cid:146)(cid:135)(cid:148)(cid:131)(cid:150)(cid:139)(cid:144)(cid:137)(cid:3)(cid:131)(cid:133)(cid:150)(cid:139)(cid:152)(cid:139)(cid:150)(cid:139)(cid:135)(cid:149)(cid:484)(cid:3)(cid:3)(cid:22)(cid:135)(cid:135)(cid:3)(cid:6)(cid:145)(cid:144)(cid:149)(cid:145)(cid:142)(cid:139)(cid:134)(cid:131)(cid:150)(cid:135)(cid:134)(cid:3)(cid:22)

(cid:151)(cid:132)(cid:150)(cid:148)(cid:131)(cid:133)(cid:150)(cid:139)(cid:144)(cid:137)(cid:3)(cid:131)(cid:134)(cid:134)(cid:139)
(cid:150)(cid:131)(cid:150)(cid:135)(cid:143)(cid:135)(cid:144)(cid:150)(cid:149)(cid:3)(cid:145)(cid:136)(cid:3)(cid:6)(cid:131)(cid:149)(cid:138)

(cid:139)(cid:150)(cid:139)(cid:145)(cid:144)(cid:149)(cid:3)(cid:150)(cid:145)(cid:3)(cid:146)(cid:148)(cid:145)(cid:146)(cid:135)(cid:148)(cid:150)(cid:155)(cid:481)
(cid:138)(cid:3)(cid:9)(cid:142)(cid:145)(cid:153)(cid:149)(cid:3)(cid:145)(cid:144)(cid:3)(cid:146)(cid:131)(cid:137)(cid:135)(cid:3)(cid:887)(cid:883)(cid:3)(cid:145)(cid:136)(cid:3)(cid:145)(cid:151)(cid:148)(cid:3)(cid:4)(cid:144)(cid:144)(cid:151)(cid:131)(cid:142)(cid:3)(cid:21)(cid:135)(cid:146)(cid:145)(cid:148)(cid:150)(cid:484)(cid:3)

(cid:3)(cid:146)(cid:142)(cid:131)(cid:144)(cid:150)(cid:3)(cid:131)(cid:144)(cid:134)(cid:3)(cid:135)(cid:147)(cid:151)(cid:139)(cid:146)(cid:143)(cid:135)(cid:144)(cid:150)(cid:3)(cid:136)(cid:148)(cid:145)(cid:143)(cid:3)(cid:144)(cid:135)(cid:150)(cid:3)

2

 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 December 29, 2019

or

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: 001-11796 
____________________________ 

Masonite International Corporation 

(Exact name of registrant as specified in its charter)
____________________________ 

British Columbia, Canada
(State or other jurisdiction of incorporation or organization)

98-0377314
(I.R.S. Employer Identification No.)

2771 Rutherford Road 
Concord, Ontario L4K 2N6 Canada 
(Address of principal executive offices, zip code)

(800) 895-2723  
(Registrant’s telephone number, including area code)
____________________________ 
Securities Registered Pursuant to Section 12(b) of the Act:

Common Stock (no par value)
(Title of class)

DOOR
(Trading symbol)

New York Stock Exchange
(Name of exchange on which registered)

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 (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to
submit such files). Yes 

 No

d
t

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

Non-accelerated filer

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.

ff

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 June 30, 2019, the last business day of the registrant’s most recently completed second fiscal quarter, the aggregate market value of the shares
of voting common stock held by non-affiliates of the registrant, computed by reference to the closing sales price of such shares on the New York 
Stock Exchange on June 30, 2019, was $1.3 billion. 

rr

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of the securities under a plan confirmed by a court. Yes 

 No

The registrant had outstanding 24,931,203 shares of Common Stock, no par value, as of February 17, 2020.

Portions of the registrant’s definitive Proxy Statement for its 2020 Annual General Meeting of Shareholders scheduled to be held on May 14, 2020,
to be filed with the Securities and Exchange Commission not later than 120 days after December 29, 2019, are incorporated by reference into Part 
III, Items 10-14 of this Annual Report on Form 10-K.

DOCUMENTS INCORPORATED BY REFERENCE

MASONITE INTERNATIONAL CORPORATION
INDEX TO ANNUAL REPORT ON FORM 10-K
December 29, 2019

PART I

Item 1

Item 1A

Item 1B

Item 2

Item 3
Item 4
PART II
Item 5

Item 6

Item 7

Business

Risk Factors

Unresolved Staff Comments

Properties

Legal Proceedings
Mine Safety Disclosures

Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases
of Equity Securities

Selected Financial Data

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 7A

Quantitative and Qualitative Disclosures About Market Risk

Item 8

Item 9

Financial Statements and Supplementary Data

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Item 9A

Controls and Procedures

Item 9B
PART III

Item 10

Item 11
Item 12

Item 13
Item 14
PART IV

Item 15

Item 16

Other Information

Directors, Executive Officers and Corporate Governance

Executive Compensation

Security Ownership of Certain Beneficial Owners and Management and Related 
Stockholder Matters

Certain Relationships and Related Transactions, and Director Independence
Principal Accountant Fees and Services

Exhibits and Financial Statement Schedules

Form 10-K Summary

Page No.

g

1

9

22

22

22
22

23

26

27

43

45

95

95

97

98

99
99

99
99

100

105

i

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Annual Report on Form 10-K contains "forward-looking statements" within the meaning of the federal

securities laws, including, without limitation, statements concerning the conditions in our industry, our operations, our 
economic performance and financial condition, including, in particular, statements relating to our business and growth
strategy and product development efforts under "Management’s Discussion and Analysis of Financial Condition and 
Results of Operations." Forward-looking statements include all statements that do not relate solely to historical or 
current facts and can be identified by the use of words such as "may," "might," "could," "will," "would," "should,"
"expect," "believes," "outlook," "predict," "forecast," "objective," "remain," "anticipate," "estimate," "potential," 
"continue," "plan," "project," "targeting," and other similar expressions. You are cautioned not to place undue reliance 
on these forward-looking statements, which speak only as of their dates. These forward-looking statements are based on
estimates and assumptions by our management that, although we believe to be reasonable, are inherently uncertain and 
subject to a number of risks and uncertainties. These risks and uncertainties include, without limitation, those identified 
under "Risk Factors" and elsewhere in this Annual Report.

The following list represents some, but not necessarily all, of the factors that could cause actual results to differ 

from historical results or those anticipated or predicted by these forward-looking statements:

• 
• 

• 
• 

• 

• 
• 
• 

• 

• 

• 
• 
• 
• 
• 
• 
• 

• 

downward trends in our end markets and in economic conditions;
reduced levels of residential new construction; residential repair, renovation and remodeling; and non-
residential building construction activity due to increases in mortgage rates, changes in mortgage interest 
deductions and related tax changes and reduced availability of financing;
competition;
the continued success of, and our ability to maintain relationships with, certain key customers in light of price
increases and customer concentration and consolidation;
tariffs and evolving trade policy and friction between the United States and other countries, including China,
and the impact of anti-dumping and countervailing trade cases; 
increases in prices of raw materials and fuel;
increases in labor costs, the availability of labor, or labor relations (i.e., disruptions, strikes or work stoppages);
our ability to manage our operations including anticipating demand for our products, managing disruptions in
our operations, managing manufacturing realignments (including related restructuring charges), managing 
customer credit risk and successful integration of acquisitions;
the continuous operation of our information technology and enterprise resource planning systems and 
management of potential cyber security threats and attacks;
our ability to generate sufficient cash flows to fund our capital expenditure requirements, to meet our pension
obligations, and to meet our debt service obligations, including our obligations under our senior notes and our 
asset-based revolving credit facility ("ABL Facility");
political, economic and other risks that arise from operating a multinational business;
uncertainty relating to the United Kingdom's exit from the European Union;
fluctuating exchange and interest rates;
our ability to innovate and keep pace with technological developments;
product liability claims and product recalls;
retention of key management personnel;
limitations on operating our business as a result of covenant restrictions under our existing and future 
indebtedness, including our senior notes and our ABL Facility; and
environmental and other government regulations, including the United States Foreign Corrupt Practices Act 
("FCPA"), and any changes in such regulations.

We caution you that the foregoing list of important factors is not exclusive. In addition, in light of these risks
and uncertainties, the matters referred to in the forward-looking statements contained in this Annual Report may not in
fact occur. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new 
information, future events or otherwise, except as otherwise required by law.

ii

Unless we state otherwise or the context otherwise requires, in this Annual Report all references to "Masonite", "we", 
"us", "our" and the "Company" refer to Masonite International Corporation and its subsidiaries.

PART I

Item 1. Business

Overview

We are a leading global designer, manufacturer and distributor of interior and exterior doors for the new 

construction and repair, renovation and remodeling sectors of the residential and non-residential building construction
markets. Since 1925, we have provided our customers with innovative products and superior service at compelling
values. In order to better serve our customers and create sustainable competitive advantages, we focus on developing
innovative products, advanced manufacturing capabilities and technology-driven sales and service solutions. Today, we
believe we hold either the number one or two market positions in the seven product categories we target in North
America: interior molded residential doors; interior stile and rail residential doors; exterior fiberglass residential doors; 
exterior steel residential doors; interior architectural wood doors; wood veneers and molded door facings; and door 
core.

We market and sell our products to remodeling contractors, builders, homeowners, retailers, dealers,
lumberyards, commercial and general contractors and architects through well-established wholesale and retail
distribution channels. Our broad portfolio of brands, including Masonite®, Premdor®, Masonite ArchitecturalTM, 
Marshfield-AlgomaTM, Mohawk®, Megantic®, Solidor®, Residor®, Nicedor®, Door-Stop InternationalTM, Harring 
DoorsTM, National HickmanTM and Graham-MaimanTM are among the most recognized in the door industry and are 
associated with innovation, quality and value. In the fiscal year ended December 29, 2019, we sold approximately 
32 million doors to approximately 8,500 customers in 60 countries. Our fiscal year 2019 net sales by segment and 
global net sales of doors by end market are set forth below:

Net Sales
by Segment - 2019

Global Net Sales of Doors
by End Market - 2019

See Note 17 to our consolidated financial statements for additional information about our segments.

Over the past several years, we have invested in advanced technologies to increase the automation of our 

manufacturing processes, increase quality and shorten lead times and introduced targeted e-commerce and other 
marketing initiatives to improve our sales and marketing efforts and customer experience. In addition, we implemented 
a disciplined acquisition strategy that solidified our presence in the United Kingdom's interior and exterior residential
door industry, the North American residential molded and stile and rail interior door industry and created leadership 
positions in the attractive North American commercial and architectural interior wood door, door core and wood veneer 
industry.

We operate 63 manufacturing and distribution facilities in eight countries in North America, Europe, South

America and Asia, which are strategically located to serve our customers. We are one of the few vertically integrated 
door manufacturers in the world and one of only two in the North American residential molded interior door industry as 
well as the only vertically integrated door manufacturer in the North American architectural interior wood door industry. 
Our vertical integration extends to all steps of the production process from initial design, development and production
of steel press plates to produce interior molded and exterior fiberglass door facings to the manufacturing of door 

1

components, such as door cores, wood veneers and molded facings, to door slab assembly. We also offer incremental
value by pre-machining doors for hardware, hanging doors in frames with glass and hardware and pre-finishing doors
with paint or stain. We believe that our vertical integration and automation enhance our ability to develop new and 
proprietary products, provide greater value and improved customer service and create high barriers to entry. We also 
believe vertical integration enhances our ability to cut costs, although our cost structure is subject to certain factors
beyond our control, such as global commodity shocks.

Product Lines

Residential Doors

We sell an extensive range of interior and exterior doors in a wide array of designs, materials and sizes. While
substantially all interior doors are made with wood and related materials such as hardboard (including wood composite
molded and flat door facings), the use of wood in exterior doors in North America and Europe has declined over the last 
two decades as a result of the increased penetration of steel and fiberglass doors. Our exterior doors are made primarily
of steel or fiberglass. Our residential doors are molded panel, flush, stile and rail, routed medium-density fiberboard 
(“MDF”), steel or fiberglass. 

Molded panel doors are interior doors available either with a hollow or solid core and are made by assembling

two molded door skin panels around a wood or MDF frame. Molded panel doors are routinely used for closets, 
bedrooms, bathrooms and hallways. Our molded panel product line is subdivided into several distinct product groups: 
our original Molded Panel series is a combination of classic styling, period and architectural style-specific designs, 
durable construction and a variety of profiles preferred by our customers when price sensitivity is a critical component 
in the product selection; the West EndTM Collection strengthens our tradition of design innovation by introducing the 
clean and simple aesthetics found in modern linear designs to the molded panel interior door category; the Heritage®
Series, which features recessed, flat panels and sharp, Shaker-style profiles which speak to a clean, modern aesthetic
while retaining comfortable familiarity found in today’s interiors; and the Livingston door, which features versatile and 
timeless design for any style of home and was introduced in 2019. All of our molded panel doors can be upgraded with 
our proprietary, wheat straw based Safe ‘N Sound® door core or our environmentally friendly EmeraldTM door 
construction which enables homeowners, builders and architects to meet specific product requirements and “green”
specifications to attain Leadership in Energy and Environmental Design ("LEED") certification for a building or 
dwelling.

Flush interior doors are available either with a hollow or solid core and are made by assembling two facings of 
plywood, MDF, composite wood or hardboard over a wood or MDF frame. These doors can either have a wood veneer 
surface suitable for paint or staining or a composite wood surface suitable for paint. Our flush doors range from base 
residential flush doors consisting of unfinished composite wood to the ultra high-end exotic wood veneer doors.

Stile and rail doors are made from wood or MDF with individual vertical stiles, horizontal rails and panels,

which have been cut, milled, veneered and assembled from lumber such as clear pine, knotty pine, oak and cherry.
Within our stile and rail line, glass panels can be inserted to create what is commonly referred to as a French door and 
we have over 50 glass designs for use in making French doors. Where horizontal slats are inserted between the stiles 
and rails, the resulting door is referred to as a louver door. For interior purposes, stile and rail doors are primarily used 
for hallways, room dividers, closets and bathrooms. For exterior purposes, these doors are used as entry doors with 
decorative glass inserts (known as lites) often inserted into them.

Routed MDF doors are produced by using a computer controlled router carver to machine a single piece of 

double refined MDF. Our routed MDF door category is sold under the Carte Blanche® brand. The offering of designs in 
this category is extensive, as the manufacturing of routed MDF doors is based on a routing program where the milling
machine selectively removes material to reveal the final design.

Steel doors are exterior doors made by assembling two interlocking steel facings (paneled or flat) or attaching

two steel facings to a wood or steel frame and injecting the core with polyurethane insulation. With our functional
Utility Steel series, the design centric High Definition family and the prefinished Sta-Tru® HD, we offer customers the 
freedom to select the right combination of design, protection and compliance required for essentially any paint grade 
exterior door application. In addition, our product offering is significantly increased through our variety of compatible
clear or decorative glass designs.

2

Fiberglass doors are considered premier exterior doors and are made by assembling two fiberglass door facings 

to a wood frame or composite material and injecting the core with polyurethane insulation. Led by the Barrington®
door, our fiberglass door lines offer innovative designs, construction and finishes. The Barrington® family of doors is
specifically designed to replicate the construction, look and feel of a real wood door. The Door-StopTM branded 
fiberglass doors are manufactured into prehung door sets and shipped to our customers with industry-leading lead times.
We believe that our patented panel designs, sophisticated wood grain texturing and multiple application-specific 
construction processes will help our Barrington® and Belleville® fiberglass lines retain a distinct role in the exterior 
product category in the future.

Architectural Doors

Architectural doors are typically highly specified products designed, constructed and tested to ensure that 

regulatory compliance and environmental certifications such as Forest Stewardship Council and LEED certifications are 
met. These doors are sold into high-end architectural projects (schools, healthcare and government facilities) and 
commercial projects (hotels, offices, commercial/retail and industrial facilities). We believe that the architectural door 
industry is shifting focus from transactional, component sales to selling total opening solutions in key performance 
areas such as fire, security, acoustics and technology. Our two primary product series for the architectural business,
AspiroTM and CenduraTM, are comprised of four product categories: stile and rail, flush wood veneer, painted and 
laminate doors. The Aspiro series offers high-end aesthetic and performance qualities, and its doors are available in
exotic and domestic veneers, with acoustic, fire-rated and lead- and bullet-resistant options and include lifetime
warranties. The Cendura series provides a balance of performance and value and its doors are available with domestic
veneers, with acoustic and fire-rated options and include limited warranties. These product offerings provide general 
contractors and influencers more of a singular source for the total opening.

Components

In addition to residential and architectural doors, we also sell several door components to the building

materials industry. Within the residential new construction market, we provide interior door facings, agri-fiber and 
particleboard door cores, MDF and wood cut stock components to multiple manufacturers. Within the architectural
building construction market, we are a leading component supplier of various critical door components and the largest 
wood veneer door skin supplier. Additionally, we are one of the leading providers of mineral and particleboard door 
cores to the North American architectural door industry.

Molded door facings are thin sheets of molded hardboard produced by grinding or defibrating wood chips,
adding resin and other ingredients, creating a thick fibrous mat composed of dry wood fibers and pressing the mat 
between two steel press plates to form a molded sheet, the surface of which may be smooth or may contain a wood 
grain pattern. Following pressing, molded door facings are trimmed, primed and shipped to door manufacturing plants
where they are mounted on frames to produce molded doors.

Door framing materials, commonly referred to as cut stock, are wood or MDF components that constitute the

frame on which interior and exterior door facings are attached. Door cores are pressed fiber mats of refined wood chips 
or agri-fiber used in the construction of solid core doors. For doors that must achieve a fire rating higher than 45 
minutes, the door core consists of an inert mineral core or inorganic intumescent compounds.

Sales and Marketing

Our sales and marketing efforts are focused around several key initiatives designed to drive organic growth,

influence the mix sold and strengthen our customer relationships.

Multi-Level/Segment Distribution Strategy

We market our products through and to wholesale distributors, retail stores, independent and pro dealers,

builders, remodelers, architects, door and hardware distributors and general contractors.

In the residential market, we deploy an "All Products" cross merchandising strategy, which provides certain of 

our retail and wholesale customers with access to our entire product range. Our "All Products" customers benefit from
consolidating their purchases, leveraging our branding, marketing and selling strategies and improving their ability to
influence the mix of products sold to generate greater value. We service our big box retail customers directly from our 
own door fabrication facilities which provide value added services and logistics, including store direct delivery of doors
and entry systems and a full complement of in-store merchandising, displays and field service. Our wholesale 

3

 
 
 
 
 
 
 
 
residential channel customers are managed by our own sales professionals who focus on down channel initiatives 
designed to ensure our products are "pulled" through our North American wholesale distribution network.

Our architectural building construction customers are serviced by a separate and distinct sales team providing

architects, door and hardware distributors, general contractors and project owners a wide variety of technical 
specifications, specific brand differentiation, compliance and regulatory approvals, product application advice and 
multisegment specialization work across North America. Additionally, our sales team is supported by marketing 
strategies aimed to drive product specification throughout our value chains via distributors, architects and end users.

Service Innovation

We leverage our marketing, sales and customer service activities to ensure our products are strategically pulled 

through our multiple distribution channels rather than deploying a more common, tactical "push" strategy like some of 
our competitors. Our marketing approach is designed to increase the value of each and every door opening we fill with 
our doors and entry systems, regardless of the channel being used to access our products.

Our proprietary web-based tools accessible on our website also provide our customers with a direct link to our 
information systems to allow for accelerated and easy access to a wide variety of information and selling aids designed 
to increase customer satisfaction. Within our North American Residential business, our web-based tools include 
Mconnect®, an online service portal allowing our customers access to several other e-commerce tools designed to 
enhance the manufacturer-customer relationship. Once connected to our system, customers have secure access to
MAX®, Masonite’s Xpress Configurator®, a web-based tool created to design customized door systems and influence 
the mix, improve selection and ordering processes, reduce order entry and quoting errors and improve overall 
communication throughout the channel; the Product Corner, a section advising customers of the features and benefits of 
our newest products; the Media Library, a comprehensive supply of marketing materials and self-service resources; and 
Order Tracker, which allows customers to follow their purchase orders through the production process and confirm
delivery dates. Our newest commercial configurator, eMerge®, was introduced in 2019 as a future replacement for 
MAX®. eMerge® affords our customers the same benefits as MAX® and introduces an enhanced user experience with 
the added capability for seamless integration with customer systems using the latest cloud technology to streamline 
demand and reduce the need for manual order entry.

In Europe, our Solidor and Door-Stop International websites are fully functional configuration and order 

platforms that support our entry door customers in the United Kingdom. The dynamic integration of Solidor's and Door-
Stop's enterprise resource planning systems and their websites ensures that the products customers see, configure and 
order are in stock, which ensures that we are able to deliver on our promise of dependability.

In our Architectural business, we launched our new door configurator, DoorBuilderTM Live, for mill direct 
customers that makes selecting and ordering the right door easier and more intuitive. DoorBuilderTM Live is a cloud-
based software that streamlines the door ordering process for fast, accurate results. Additionally, we have developed the
new DoorSelector tool and Acoustic Sound tools designed to educate architects to help them select the right products 
for the opening based on aesthetic and performance attributes.

Customers

During fiscal year 2019, we sold our products worldwide to approximately 8,500 customers. We have 

developed strong relationships with these customers through our "All Products" cross merchandising strategy. Our 
vertical integration facilitates our "All Products" strategy with our door fabrication facilities in particular providing 
value-added fabrication and logistical services to our customers, including store delivery of pre-hung interior and 
exterior doors to our customers in North America. All of our top 20 customers have purchased doors from us for at least 
10 years.

Although we have a large number of customers worldwide, our largest customer, The Home Depot, accounted 

for approximately 17% of our total net sales in fiscal year 2019. Due to the depth and breadth of the relationship with 
this customer, which operates in multiple North American geographic regions and which sells a variety of our products,
our management believes that this relationship is likely to continue.

4

Distribution

Residential doors are primarily sold through wholesale and retail distribution channels.

• Wholesale. In the wholesale channel, door manufacturers sell their products to homebuilders,

contractors, lumber yards, dealers and building products retailers in two steps or one step. Two-step 
distributors typically purchase doors from manufacturers in bulk and customize them by installing
windows, or "lites", and pre-hanging them. One-step distributors sell doors directly to homebuilders
and remodeling contractors who install the doors.

•

Retail. The retail channel generally targets consumers and smaller remodeling contractors who
purchase doors through retail home centers and smaller specialty retailers. Retail home centers offer 
large, warehouse size retail space with large selections, while specialty retailers are niche players that 
focus on certain styles and types of doors.

Architectural doors are primarily sold through specialized one-step wholesale distribution channels where

distributors sell to general contractors and end-use clients.

Research and Development

We believe we are a global leader in technological innovation and development of doors, door components and 

door entry solutions and the manufacturing processes involved in making such products. We believe that research and 
development is a competitive advantage for us, and we intend to capitalize on our leadership in this area through the
development of more new and innovative products. Our research and development and engineering capabilities enable
us to develop and implement product and manufacturing process improvements that enable new features, enhance the
manufacturing efficiency of our products, improve quality and reduce costs. In the past few years, our research and 
development activities have had a significant focus on the development of new, differentiated products, while
continuing to focus on process and material improvements for our products. Further, we have directed increased 
research and development to address the growing need for safety and security, sound-dampening and fire-resistant 
products in the architectural wood door market. 

As an integrated manufacturer, we believe that we are well positioned to take advantage of the growing global
demand for a variety of molded door facing designs. We have an internal capability to create new molded door facing 
designs and manufacture our own molds for use in our own facilities. We believe this provides us with the ability to
develop proprietary designs that enjoy a strong identity in the marketplace; more flexibility in meeting customer 
demand; quicker reaction time in the production of new designs or design changes; and greater responsiveness to
customer needs. This capability also enables us to develop and implement product and process improvements with 
respect to the production of molded door facings and doors which enhance production efficiency and reduce costs.

Manufacturing Process

Our manufacturing operations consist of three major manufacturing processes: (1) component manufacturing, 

(2) door slab assembly and (3) value-added ready to install door fabrication.

We have a leading position in the manufacturing of door components, including internal framing components

(stile and rails), glass inserts (lites), door core, interior door facings (molded and veneer) and exterior door facings. The 
manufacturing of interior molded door facings is the most complex of these processes requiring a significant investment 
in large scale wood fiber processing equipment. Interior molded door facings are produced by combining fine wood 
particles, synthetic resins and other additives under heat and pressure in large multi-opening automated presses utilizing 
Masonite proprietary steel plates. The facings are then primed, cut and inspected in a second highly automated 
continuous operation prior to being packed for shipping to our door assembly plants. We operate five interior molded 
door facing plants around the world, two in North America and one in each of South America, Europe and Asia. Our 
sole United States based plant in Laurel, Mississippi, is one of the largest door facing plants in the world and we believe 
one of the most technologically advanced in the industry.

Interior residential hollow and solid core door manufacturing is an assembly operation that is primarily
accomplished in the United States through the use of semi-skilled manual labor. The construction process for a standard 
flush or molded interior door is based on assembly of door facings and various internal framing and support 
components, followed by the doors being trimmed to their final specifications.

5

 
 
 
 
 
 
 
The assembly process varies by type of door, from a relatively simple process for flush and molded doors, 

where the door facings are glued to a wood frame, to more complex processes where many pieces of solid and 
engineered wood are converted to louver or stile and rail door slabs. Architectural interior doors require another level of 
customization and sophistication employing the use of solid cores with varying degrees of sound dampening and fire 
retarding attributes, furniture quality wood veneer facings, as well as secondary machining operations to incorporate
more sophisticated commercial hardware, openers and locks. Additionally, architectural doors are typically pre-finished 
prior to sale.

The manufacturing of steel and fiberglass exterior door slabs is a semi-automated process that entails
combining laminated wood or rot free composite framing components between two door facings and then injecting the
resulting hollow core structure with insulating polyurethane expanding foam core materials. We invested in fiberglass
manufacturing technology, including the vertical integration of our own fiberglass sheet molding compound plant at our 
Laurel, Mississippi, facility in 2006. In 2008, we consolidated fiberglass slab manufacturing from multiple locations
throughout North America into a single highly automated facility in Dickson, Tennessee, significantly improving the
reliability and quality of these products while simultaneously lowering cost and reducing lead times.

Short set-up times, proper production scheduling and coordinated material movement are essential to achieve a

flexible process capable of producing a wide range of door types, sizes, materials and styles. We make use of our 
vertically integrated and flexible manufacturing operations together with scalable logistics primarily through the use of 
common carriers to fill customers’ orders and to minimize our investment in finished goods inventory.

Finally, interior flush and molded, stile and rail, louver and exterior door slabs manufactured at our door 

assembly plants are either sold directly to our customers or transferred to our door fabrication facilities where value 
added services are performed. These value added services include machining doors for hinges and locksets, installing
the door slabs into ready to install frames, installing hardware, adding glass inserts and side lites, painting and staining, 
packaging and logistical services to our customers.

Within our manufacturing processes, we leverage the Mvantage operating system to systemically focus on the 
elimination of waste and non-value-added activities within the organization. In 2019, we continued to drive operational
improvement to a new level using our three-pronged Mvantage strategy which includes the Model Plant Transformation
Process, Process Improvement Teams and the focus on global standards and training. Our Model Plant Transformation 
Process continues to allow the seamless flow of material through our facilities. Our Process Improvements Teams work 
closely with manufacturing sites to utilize our Mvantage lean toolbox to diagnose operational inefficiencies and apply 
corrective actions to stabilize and standardize our day-to-day operations. Our focus on training, through our Internal 
Training and Certification programs, and implementing global standards has allowed us to drive continuous
improvement through an increased number of Kaizen events that are being led by our trained facilitators. Through this 
structured approach, we realized improvements in certain key performance indicators in 2019.

Raw Materials

While Masonite is vertically integrated, we require a regular supply of raw materials, such as wood chips,

some cut stock components, various composites, steel, glass, paint, stain and primer as well as petroleum-based 
products such as binders, resins and plastic injection frames to manufacture and assemble our products. In 2019, our 
materials cost accounts for approximately 52% of the total cost of the finished product. In certain instances, we depend 
on a single or limited number of suppliers for these supplies. Wood chips, logs, resins, binders and other additives
utilized in the manufacturing of interior molded facings, exterior fiberglass door facings and door cores are purchased 
from global, regional and local suppliers taking into consideration the relative freight cost of these materials. Internal
framing components, MDF, cut stock and internal door cores are manufactured internally at our facilities and 
supplemented from suppliers located throughout the world. We utilize a network of suppliers based in North America,
Europe, South America and Asia to purchase other components including steel coils for the stamping of steel door 
facings, MDF, plywood and hardboard facings, door jambs and frames and glass frames and inserts.

Safety

We believe that safety is as important to our success as productivity and quality. This is reflected in our goal of 
Target Zero and our continued effort to create an injury-free workplace. We also believe that incidents can be prevented 
through proper management, employee involvement, standardized operations and equipment and attention to detail.
Safety programs and training are provided throughout the company to ensure employees and managers have effective
tools to help identify and address both unsafe conditions and at-risk behaviors.

6

 
 
 
 
 
 
 
Through a sustained commitment to improve our safety performance, we have been successful in reducing the

number of injuries sustained by our employees. In 2019, the total incident rate, the annual number of injuries per 100
full time equivalent employees, decreased by 0.2. 

Environmental and Other Regulatory Matters

We strive to minimize any adverse environmental impact our operations might have to our employees, the

general public and the communities of which we are a part. We are subject to extensive environmental laws and 
regulations. The geographic breadth of our facilities subjects us to environmental laws, regulations and guidelines in a
number of jurisdictions, including, among others, the United States, Canada, Mexico, the United Kingdom, the 
Republic of Ireland, the Czech Republic, Chile and Malaysia. Such laws, regulations and guidelines relate to, among 
other things, the discharge of contaminants into water and air and onto land, the storage and handling of certain
regulated materials used in the manufacturing process, waste minimization, the disposal of wastes and the remediation 
of contaminated sites. Many of our products are also subject to various regulations such as building and construction 
codes, product safety regulations, health and safety laws and regulations and mandates related to energy efficiency.

Our efforts to ensure environmental compliance include the review of our operations on an ongoing basis

utilizing in-house staff and on a selective basis by specialized environmental consultants. The Environmental, Health 
and Safety team participates in industry groups to monitor developing regulatory actions and actively develop
comments on specific issues. Furthermore, for our prospective acquisition targets, environmental assessments are 
conducted as part of our due diligence review process. Based on recent experience and current projections,
environmental protection requirements and liabilities are not expected to have a material effect on our business, capital
expenditures, operations or financial position.

In addition to the various environmental laws and regulations, our operations are subject to numerous foreign,

federal, state and local laws and regulations, including those relating to the presence of hazardous materials and 
protection of worker health and safety, consumer protection, trade, labor and employment, tax and others. We believe 
we are in compliance in all material respects with existing applicable laws and regulations affecting our operations.

Intellectual Property

In North America, our doors are marketed primarily under the Masonite® brand. Other North American brands  

include: Premdor®, Masonite Architectural®, Barrington®, Oakcraft®, Sta-Tru® HD, AvantGuard®, Vistagrande®,
Flagstaff®ff , Hollister®, Sierra®, Fast-Frame®, Safe ’N Sound®, Heritage Series®, Livingston®, AquaSealTM, Cheyenne®, 
Glenview®, Riverside®, Saddlebrook®, Fast-Fit®, Mohawk®,  Megantic®, Birchwood Best®, Algoma®, Vignette®, 
RhinoDoor®, Lemieux®, Harring DoorsTM, FyreWerks®, Graham-MaimanTM, MaimanTM and Marshfield-Algoma®. In
Europe, doors are marketed under the Masonite®, Premdor®, Premdor Speed Set®, Door-Stop International®, National
Hickman®, Defining Spaces®, Solidor®, Residor®, Nicedor® and Residence Collection® brands. We consider the use of 
trademarks and trade names to be important in the development of product awareness, and for differentiating products 
from competitors and between customers. 

We protect the intellectual property that we develop through, among other things, filing for patents in the
United States and various foreign countries. In the United States, we currently have 271 design patents and design
patent applications and 146 utility patents and patent applications. We currently have 174 foreign design patents and 
patent applications and 232 foreign utility patents and patent applications. Our United States utility patents are generally 
applicable for 20 years from the earliest filing date, our United States design patents for 15 years and our United States
registered trademarks and tradenames are generally applicable for 10 years and are renewable. Our foreign patents and 
trademarks have terms as set by the particular country, although trademarks generally are renewable.

Competition

The North American door industry is highly competitive and includes a number of global and local
participants. In the North American residential interior door industry, the primary participants are Masonite and JELD-
WEN, which are the only vertically integrated manufacturers of molded door facings. There are also a number of 
smaller competitors in the residential interior door industry that primarily source door facings from third party suppliers. 
In the North American residential exterior door industry, the primary participants are Masonite, JELD-WEN, Plastpro, 
Therma-Tru, Feather River and Novatech. In the North American non-residential building construction door industry, 
the primary participants are Masonite and VT Industries with the remainder supplied by multiple regional
manufacturers. Our primary market in Europe is the United Kingdom. The United Kingdom door industry is similarly 

7

 
 
 
 
 
 
 
competitive, including a number of global and local participants. The primary participants in the United Kingdom are
our subsidiary Premdor, JELD-WEN, Vicaima and Distinction Doors. Competition in these markets is primarily based 
on product quality, design characteristics, brand awareness, serviceability, distribution capabilities and value. We also 
face competition in the other countries in which we operate. In Europe, South America and Asia, we face significant 
competition from a number of regionally based competitors and importers.

A large portion of our products are sold through large home centers and other large retailers. The consolidation 

of our customers and our reliance on fewer larger customers has increased the competitive pressures as some of our 
largest customers, such as The Home Depot, perform periodic product line reviews to assess their product offerings and 
suppliers.

We are one of the largest manufacturers of molded door facings in the world. The rest of the industry consists 

of one other large, integrated door manufacturer and a number of smaller regional manufacturers. Competition in the 
molded door facing business is based on quality, price, product design, logistics and customer service. We produce 
molded door facings to meet our own requirements and outside of North America we serve as an important supplier to
the door industry at large. We manufacture molded door facings at our facilities in Mississippi, Ireland, Chile, Canada
and Malaysia.

Employees

As of December 29, 2019, we employed approximately 10,000 employees and contract personnel. This 
includes approximately 2,200 unionized employees, approximately 70% of whom are located in North America with the
remainder in various foreign locations. Nine of our North American facilities have individual collective bargaining 
agreements, which are negotiated locally and the terms of which vary by location. 

History and Reporting Status

Masonite was founded in 1925 in Laurel, Mississippi, by William H. Mason, to utilize vastly available
quantities of sawmill waste to manufacture a usable end product. Masonite was acquired by Premdor from International
Paper Company in August 2001.

Prior to 2005, Masonite was a public company with shares of our predecessor’s common stock listed on both

the New York and Toronto Stock Exchanges. In March 2005, we were acquired by an affiliate of Kohlberg Kravis
Roberts & Co. L.P.

On March 16, 2009, Masonite International Corporation and several affiliated companies, voluntarily filed to
reorganize under the Company's Creditors Arrangement Act (the "CCAA") in Canada in the Ontario Superior Court of 
Justice. Additionally, Masonite International Corporation and Masonite Inc. (the former parent of the Company) and all
of its U.S. subsidiaries filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the
U.S. Bankruptcy Court in the District of Delaware. On June 9, 2009, we emerged from reorganization proceedings
under the CCAA in Canada and under Chapter 11 of the U.S. Bankruptcy Code in the United States.

Effective July 4, 2011, pursuant to an amalgamation under the Business Corporations Act (British Columbia), 

Masonite Inc. amalgamated with Masonite International Corporation to form an amalgamated corporation named 
Masonite Inc., which then changed its name to Masonite International Corporation.

On September 9, 2013, our shares commenced listing on the New York Stock Exchange under the symbol 

"DOOR" and we became subject to periodic reporting requirements under the United States federal securities laws. We 
are currently not a reporting issuer, or the equivalent, in any province or territory of Canada and our shares are not listed 
on any recognized Canadian stock exchange.

Our United States executive offices are located at One Tampa City Center, 201 North Franklin Street, Suite

300, Tampa, Florida 33602 and our Canadian executive offices are located at 2771 Rutherford Road, Concord, Ontario
L4K 2N6.

8

 
 
 
 
 
 
 
 
 
Available Information

We make our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K 

and any amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange 
Act of 1934 available through our website, free of charge, as soon as reasonably practicable after we electronically file 
such material with, or furnish it to, the Securities and Exchange Commission. Our website is www.masonite.com. 
Information on our website does not constitute part of this Annual Report on Form 10-K.

Item 1A. Risk Factors

You should carefully consider the following factors in addition to the other information set forth in this Annual 
Report before investing in our common shares. The risks and uncertainties described below are not the only ones facing 
us. If any of the following risks actually occur, our business, financial condition or results of operations would likely 
suffer. In such case, the trading price of our common shares could fall, and you may lose all or part of your investment.

Risks Related to Our Business

Downward trends in our end markets or in economic conditions could negatively impact our business and financial 
performance.

Our business may be adversely impacted by changes in United States, Canadian, European, Asian, South
American or global economic conditions, including inflation, deflation, interest rates, foreign exchange rate fluctuation, 
availability and cost of capital, consumer spending rates, energy availability and costs, and the effects of governmental
initiatives to manage economic conditions. Volatility in the financial markets in the regions in which we operate and the 
deterioration of national and global economic conditions have in the past and could in the future materially adversely
impact our operations, financial results and liquidity.

Trends in our primary end markets (residential new construction, repair, renovation and remodeling and non-
residential building construction) directly impact our financial performance because they are directly correlated to the 
demand for doors and door components. Accordingly, the following factors may have a direct impact on our business in
the countries and regions in which our products are sold:

• 
• 
• 
• 
• 
• 
• 
• 
• 

the strength of the economy;
the amount and type of residential and non-residential construction;
housing sales and home values;
the age of existing home stock, home vacancy rates and foreclosures;
non-residential building occupancy rates;
increases in the cost of raw materials or wages, or any shortage in supplies or labor;
the availability and cost of credit;
employment rates and consumer confidence; and
demographic factors such as immigration and migration of the population and trends in household formation.

In the United States, the housing market crisis had a negative impact on residential housing construction and 

related product suppliers. In addition, the current housing recovery is characterized by new construction levels still well
below historical levels, and at times including an increased number of multi-family new construction starts, which 
generally use fewer of our products and may generate less net sales at a lower margin than typical single family homes.

In many of the non-North American markets in which we manufacture and sell our products, economic 
conditions deteriorated as various countries suffered from the after effects of the global financial downturn that began in 
the United States in 2006. Certain of our non-North American markets were acutely affected by the housing downturn 
and future downturns could cause excess capacity in housing and building products, including doors and door products,
which may make it difficult for us to raise prices. Due in part to both market and operating conditions, we exited certain
markets in the past several years, including Ukraine, Turkey, Romania, Hungary, Poland, Israel, France and South
Africa. 

Our relatively narrow focus within the building products industry amplifies the risks inherent in a prolonged 
global market downturn. The impact of this weakness on our net sales, net income and margins will be determined by 
many factors, including industry capacity, industry pricing, and our ability to implement our business plan.

9

 
 
 
 
 
 
Increases in mortgage rates, changes in mortgage interest deductions and related tax changes and the reduced 
availability of financing for the purchase of new homes and home construction and improvements could have a material 
adverse impact on our sales and profitability.

In general, demand for new homes and home improvement products may be adversely affected by increases in

mortgage rates and the reduced availability of consumer financing. Mortgage rates remain near historic lows but have
recently increased and will likely increase in the future. If mortgage rates increase and, consequently, the ability of 
prospective buyers to finance purchases of new homes or home improvement products is adversely affected, our 
business, financial condition and results of operations may be materially and adversely affected.

In addition, the Tax Cuts and Jobs Act in the United States placed a cap on the amount of mortgage debt on 
which interest can be deducted and also made interest on home equity debt non-deductible. These changes and future
changes in policies set to encourage home ownership and improvement may adversely impact demand for our products
and have a material adverse impact on us.

The ability of consumers to finance these purchases is affected by such factors as new and existing home 

prices, homeowners’ equity values, interest rates and home foreclosures. Adverse developments affecting any of these
factors could result in a tightening of lending standards by financial institutions and reduce the ability of some
consumers to finance home purchases or repair and remodeling expenditures. The global financial downturn that began
in the United States in 2006, included declining home and other building values, increased home foreclosures and 
tightening of credit standards by lending institutions, negatively impacted the home and other building new construction 
and repair and remodeling sectors. While these credit market trends have improved in recent years, if they were to 
reoccur or worsen, our net sales and net income may be adversely affected.

We operate in a competitive business environment. If we are unable to compete successfully, we could lose customers
and our sales could decline.

The building products industry is highly competitive. Some of our principal competitors may have greater 

financial, marketing and distribution resources than we do and may be less leveraged than we are, providing them with
more flexibility to respond to new technology or shifting consumer demand. Accordingly, these competitors may be
better able to withstand changes in conditions within the industry in which we operate and may have significantly 
greater operating and financial flexibility than we do. Also, certain of our competitors may have excess production
capacity, which may lead to pressure to decrease prices in order for us to remain competitive and may limit our ability
to raise prices even in markets where economic and market conditions have improved. For these and other reasons,
these competitors could take a greater share of sales and cause us to lose business from our customers or hurt our 
margins.

As a result of this competitive environment, we face pressure on the sales prices of our products. Because of 
these pricing pressures, we may in the future experience limited growth and reductions in our profit margins, sales or 
cash flows, and may be unable to pass on future raw material price, labor cost and other input cost increases to our 
customers which would also reduce profit margins.

Because we depend on a core group of significant customers, our sales, cash flows from operations, results of 
operations and our ability to implement price increases for our products may be negatively affected if our key customers 
reduce the amount of products they purchase from us.

Our customers consist mainly of wholesalers, retail home centers and contractors. Our top ten customers 

together accounted for approximately 43% of our net sales in fiscal year 2019, while our largest customer, The Home
Depot, accounted for approximately 17% of our net sales in fiscal year 2019. We expect that a small number of 
customers will continue to account for a substantial portion of our net sales for the foreseeable future. However, net 
sales from customers that have accounted for a significant portion of our net sales in past periods, individually or as a
group, may not continue to do so in future periods, or if continued, may not reach or exceed historical levels in any
period. For example, many of our largest customers, including The Home Depot, perform periodic line reviews to 
assess their product offerings, which have, on past occasions, led to loss of business and pricing pressures. In addition,
as a result of competitive bidding processes, we may not be able to increase or maintain the margins at which we sell 
our products to our most significant customers. Moreover, if any of these customers fails to remain competitive in the
respective markets or encounters financial or operational problems, our net sales and profitability may decline. We
generally do not enter into long-term contracts with our customers and they generally do not have an obligation to
purchase products from us. Therefore, we could lose a significant customer with little or no notice. The loss of, or a

10

 
 
 
 
 
 
significant adverse change in, our relationships with The Home Depot or any other major customer could cause a
material decrease in our net sales. The loss of, or a reduction in orders from, any significant customers, losses arising
from customer disputes regarding shipments, fees, merchandise condition or related matters, or our inability to collect 
accounts receivable from any major customer, could have a material adverse effect on us. Also, we have no operational
or financial control over these customers and have limited influence over how they conduct their businesses.

In the fourth quarter of 2019, we communicated price increases that became effective on February 3, 2020, to 
our North American Residential customers that, for certain products, were significantly greater than our typical annual 
increases. We also communicated our intent to incrementally invest $100 million over the next five years in the areas of 
service and quality improvements, product innovation and end user marketing. While we believe that these initiatives
are necessary in order to increase the profile of, and demand for, our products and that they will benefit both us and our 
customers, we cannot predict whether our efforts will ultimately be successful or how our customers will react to these
initiatives which could have a material impact on our results of operations for future periods. Further, our competitors 
may adopt more aggressive sales policies and devote greater resources to the development, promotion and sale of their 
products than we do, which could result in a loss of customers.

Consolidation of our customers and their increasing size could adversely affect our results of operations.

In many of the countries in which we operate, an increasingly large number of building products are sold 
through large retail home centers and other large retailers. In addition, we have experienced consolidation of distributors 
in our wholesale distribution channel and among businesses operating in different geographic regions resulting in more
customers operating nationally and internationally. If the consolidation of our customers and distributors were to
continue, leading to the further increase of their size and purchasing power, we may be challenged to continue to
provide consistently high customer service levels for increasing sales volumes, while still offering a broad portfolio of 
innovative products and on-time and complete deliveries. If we fail to provide high levels of service, broad product 
offerings, competitive prices and timely and complete deliveries, we could lose a substantial amount of our customer 
base and our profitability, margins and net sales could decrease. We have also experienced the consolidation of our 
wholesale distributors by our competitors, such as JELD-WEN's acquisitions of American Building Supply, Inc., in 
2018 and Milliken Millwork, Inc., in 2017. Consolidation of our customers could also result in the loss of a customer or 
a substantial portion of a customer's business.

Tariffs and evolving trade policy between the United States and other countries, including China, and the impact of 
anti-dumping and countervailing trade cases may have an adverse effect on our business and results of operations.

Recent steps taken by the United States government to apply and consider applying tariffs on certain products
and materials, including steel, could potentially disrupt our existing supply chains and impose additional costs on our 
business, including costs with respect to raw materials upon which our business depends. The increased costs may 
negatively impact our margins as we may not be able to pass on the additional costs by increasing the prices of our 
products. Additionally, antidumping and countervailing duty trade cases, such as the January 8, 2020, Coalition of 
American Producers antidumping and countervailing duty petitions against Wood Mouldings and Millwork Products
from Brazil and China, could impact our business and results of operations, While we believe our exposure to the 
potential increased costs of these tariffs and duties is no greater than the industry as a whole, our business and results of 
operations may be adversely affected if our efforts to mitigate their effects are unsuccessful.

Increased prices for raw materials or finished goods used in our products or interruptions in deliveries of raw materials 
or finished goods could adversely affect our profitability, margins and net sales.

Our profitability is affected by the prices of raw materials and finished goods used in the manufacture of our 
products. These prices have fluctuated and may continue to fluctuate based on a number of factors beyond our control,
including world oil prices, changes in supply and demand, general economic or environmental conditions, labor costs, 
competition, import duties, tariffs, currency exchange rates and, in some cases, government regulation. The
commodities we use may undergo major price fluctuations and there is no certainty that we will be able to pass these 
costs through to our customers. Significant increases in the prices of raw materials or finished goods are more difficult 
to pass through to customers in a short period of time and may negatively impact our short-term profitability, margins
and net sales. In the current competitive environment, opportunities to pass on these cost increases to our customers 
may be limited.

We require a regular supply of raw materials, such as wood, wood composites, cut stock, steel, glass, core
material, paint, stain and primer as well as petroleum-based products such as binders, resins and frames. In certain

11

instances, we depend on a single or limited number of suppliers for these supplies. We typically do not have long-term
contracts with our suppliers. If we are not able to accurately forecast our supply needs, the limited number of suppliers
may make it difficult to obtain additional raw materials to respond to shifting or increased demand. Our dependency
upon regular deliveries from particular suppliers means that interruptions or stoppages in such deliveries could 
adversely affect our operations until arrangements with alternate suppliers could be made. Furthermore, because our 
products and the components of some of our products are subject to regulation, such alternative suppliers, even if 
available, may not be substituted until regulatory approvals for such substitution are received, thereby delaying our 
ability to respond to supply changes. Moreover, some of our raw materials, especially those that are petroleum or 
chemical based, interact with other raw materials used in the manufacture of our products and therefore significant lead 
time may be required to procure a compatible substitute. Substitute materials may also not be of the same quality as our 
original materials.

If any of our suppliers were unable to deliver materials to us for an extended period of time (including as a 

result of delays in land or sea shipping), or if we were unable to negotiate acceptable terms for the supply of materials
with these or alternative suppliers, our business could suffer. In the future, we may not be able to find acceptable supply
alternatives, and any such alternatives could result in increased costs for us. Even if acceptable alternatives are found,
the process of locating and securing such alternatives might be disruptive to our business.

Furthermore, raw material prices could increase, and supply could decrease, if other industries compete with us
for such materials. For example, we are highly dependent upon our supply of wood chips used for the production of our 
door facings and wood composite materials. Failure to obtain significant supply may disrupt our operations and even if 
we are able to obtain sufficient supply, we may not be able to pass increased supply costs on to our customers in the 
form of price increases, thereby resulting in reduced margins and profits.

A rapid and prolonged increase in fuel prices may significantly increase our costs and have an adverse impact on our 
results of operations.

Fuel prices may be volatile and are significantly influenced by international, political and economic
circumstances. While fuel prices have fallen from historical highs over the last several years, lower fuel prices may not 
be permanent. If fuel prices were to rise for any reason, including fuel supply shortages or unusual price volatility, the 
resulting higher fuel prices could materially increase our shipping costs, adversely affecting our results of operations. In
addition, competitive pressures in our industry may have the effect of inhibiting our ability to reflect these increased 
costs in the prices of our products.

Increases in labor costs, availability of labor, or potential labor disputes and work stoppages at our facilities or the
facilities of our suppliers could materially adversely affect our financial performance.

Our financial performance is affected by the availability of qualified personnel and the cost of labor as it 

impacts our direct labor, overhead, distribution and selling, general and administration costs. Increased costs of wages
and benefits and the lack of qualified labor available has had and could continue to have an adverse effect on our results
of operations. 

Additionally, we have approximately 10,000 employees and contract personnel worldwide, including 

approximately 2,200 unionized workers. Employees represented by these unions are subject to collective bargaining
agreements that are subject to periodic negotiation and renewal, including our agreements with employees and their 
respective work councils in Chile, Mexico and the United Kingdom, which are subject to annual negotiation. If we are
unable to enter into new, satisfactory labor agreements with our unionized employees upon expiration of their 
agreements, we could experience a significant disruption of our operations, which could cause us to be unable to deliver 
products to customers on a timely basis. If our workers were to engage in strikes, a work stoppage or other slowdowns, 
we could also experience disruptions of our operations. Such disruptions could result in a loss of business and an
increase in our operating expenses, which could reduce our net sales and profit margins. In addition, our non-unionized 
labor force may become subject to labor union organizing efforts, such as the attempt to organize our Northumberland 
facility in 2015, which could cause us to incur additional labor costs and increase the related risks that we now face.

We believe many of our direct and indirect suppliers and customers also have unionized workforces. Strikes,
work stoppages or slowdowns experienced by these suppliers and customers could result in slowdowns or closures of 
facilities where components of our products are manufactured or delivered. Any interruption in the production or 
delivery of these components could reduce sales, increase costs and have a material adverse effect on us.

12

If we are unable to accurately predict future demand preferences for our products, our business and results of 
operations could be materially affected.

A key element to our continued success is the ability to maintain accurate forecasting of future demand 
preferences for our products. Our business in general is subject to changing consumer and industry trends, demands and 
preferences. Changes to consumer shopping habits and potential trends towards "online" purchases could also impact 
our ability to compete as we currently sell our products mainly through our distribution channels. Our continued success
depends largely on the introduction and acceptance by our customers of new product lines and improvements to existing
product lines that respond to such trends, demands and preferences. Trends within the industry change often and our 
failure to anticipate, identify or quickly react to changes in these trends could lead to, among other things, rejection of a
new product line and reduced demand and price reductions for our products, and could materially adversely affect us. In 
addition, we are subject to the risk that new products could be introduced that would replace or reduce demand for our 
products. Furthermore, new proprietary designs and/or changes in manufacturing technologies may render our products
obsolete or we may not be able to manufacture products or designs at prices that would be competitive in the
marketplace. We may not have sufficient resources to make necessary investments or we may be unable to make the 
investments or acquire the intellectual property rights necessary to develop new products or improve our existing
products.

Our business is seasonal which may affect our net sales, cash flows from operations and results of operations.

Our business is moderately seasonal and our sales vary from quarter to quarter based upon the timing of the
building season in our markets. Severe weather conditions in any quarter, such as unusually prolonged warm or cold 
conditions, rain, blizzards or hurricanes, could accelerate, delay or halt construction and renovation activity. The impact 
of these types of events on our business may adversely impact our sales, cash flows from operations and results of 
operations. Also, we cannot predict the effects on our business that may result from global climate change, including
potential new related laws or regulations. If sales were to fall substantially below what we would normally expect 
during certain periods, our annual financial results would be adversely impacted. Moreover, our facilities are vulnerable 
to severe weather conditions.

A disruption in our operations could materially affect our operating results.

We operate facilities worldwide. Many of our facilities are located in areas that are vulnerable to hurricanes, 

earthquakes and other natural disasters. In the event that a hurricane, earthquake, natural disaster, fire or other 
catastrophic event were to interrupt our operations for any extended period of time, particularly at one or more of our 
door facing facilities or architectural door plants, such as when our Stockton, California, cut stock plant was destroyed 
when a fire broke out at a non-Masonite facility adjacent to our plant in April 2019, it could delay shipment of 
merchandise to our customers, damage our reputation or otherwise have a material adverse effect on our financial 
condition and results of operations. Closure of one of our door facing facilities, which are our most capital intensive and 
least replaceable production facilities, could have a substantial negative effect on our earnings.

In addition, our operations may be interrupted by terrorist attacks, other acts of violence or war or public health 

crises, such as the coronavirus. These events may directly impact our suppliers’ or customers’ physical facilities. 
Furthermore, these events may make travel and the transportation of our supplies and products more difficult and more
expensive and ultimately affect our operating results. The United States has entered into, and may enter into, additional
armed conflicts which could have a further impact on our sales and our ability to deliver product to our customers in the 
United States and elsewhere. Political and economic instability in some regions of the world, including the current 
instabilities in the Middle East and North Korea, may also negatively impact our business. The consequences of any of 
these armed conflicts are unpredictable, and we may not be able to foresee events that could have an adverse effect on
our business or your investment. More generally, any of these events could cause consumer confidence and spending to 
decrease or result in increased volatility in the United States and worldwide financial markets and economy. They could 
also result in economic recession in the United States or abroad. Any of these occurrences could have a significant 
impact on our operating results.

Manufacturing realignments may result in a decrease in our short-term earnings, until the expected cost reductions are
achieved, as well as reduce our flexibility to respond quickly to improved market conditions.

We continually review our manufacturing operations and sourcing capabilities. Effects of periodic 
manufacturing realignments and cost savings programs have in the past and could in the future result in a decrease in
our short-term earnings, including the impacts of restructuring charges and related impairments and other expenses,

13

 
 
 
 
 
until the expected cost reductions are achieved. We also cannot assure you we will achieve all of our cost savings. Such 
programs may include the consolidation, integration and upgrading of facilities, functions, systems and procedures. The
success of these efforts will depend in part on market conditions, and such actions may not be accomplished as quickly 
as anticipated and the expected cost reductions may not be achieved or sustained.

In connection with our manufacturing realignment and cost savings programs, we have closed or consolidated 

a substantial portion of our global operations and reduced our personnel, which may reduce our flexibility to respond 
quickly to improved market conditions. In addition, we have in the past and may again in the future, restructure portions
of our global workforce to simplify and streamline our organization, improve our cost structure and strengthen our 
overall business. These changes could affect employee morale and productivity and be disruptive to our business and 
financial performance. For example, in 2017 we closed our Algoma, Wisconsin, facility in order to improve our cost 
structure and enhance operational efficiencies. Further, a failure to anticipate a sharp increase in levels of residential 
new construction, residential repair, renovation and remodeling and non-residential building construction activity could 
result in operational difficulties, adversely impacting our ability to provide our products to our customers. This may
result in the loss of business to our competitors in the event they are better able to forecast or respond to market 
demand. There can be no assurance that we will be able to accurately forecast the level of market demand or react in a
timely manner to such changes, which may have a material adverse effect on our business, financial condition and 
results of operations.

We are subject to the credit risk of our customers.

We provide credit to our customers in the normal course of business. We generally do not require collateral in

extending such credit. An increase in the exposure, coupled with material instances of default, could have a material
adverse effect on our business, financial condition, results of operations and cash flow.

Our recent acquisitions and any future acquisitions, if available, could be difficult to integrate and could adversely
affect our operating results.

In the past several years we completed several strategic acquisitions of door and door component 

manufacturers in North America and the United Kingdom. Historically, we have made acquisitions to vertically
integrate and expand our operations, such as our acquisitions of TOPDOORS, s.r.o. ("Top Doors") in 2019, Bridgewater 
Wholesalers Inc. ("BWI"), Graham Manufacturing Corporation and The Maiman Company (collectively, "Graham &
Maiman") and DW3 Products Holdings Limited ("DW3") in 2018; and A&F Wood Products, Inc. ("A&F") in 2017. 
From time to time, we have evaluated and we continue to evaluate possible acquisition transactions on an on-going 
basis. Our acquisitions may not be accretive. At any time we may be engaged in discussions or negotiations with respect 
to possible acquisitions or may have entered into non-binding letters of intent. As part of our strategy, we expect to
continue to pursue complementary acquisitions and investments and may expand into product lines or businesses with 
which we have little or no operating experience. For example, future acquisitions may involve building product 
categories other than doors. We may also engage in further vertical integration. However, we may face competition for 
attractive targets and we may not be able to source appropriate acquisition targets at prices acceptable to us, or at all. In
addition, in order to pursue our acquisition strategy, we will need significant liquidity, which, as a result of the other 
factors described herein, may not be available on terms favorable to us, or at all.

Our recent and any future acquisitions involve a number of risks, including:

• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 

our inability to integrate the acquired business, including their information technology systems;
our inability to manage acquired businesses or control integration and other costs relating to acquisitions;
our lack of experience with a particular business should we invest in a new product line;
diversion of management attention;
our failure to achieve projected synergies or cost savings;
impairment of goodwill affecting our reported net income;
our inability to retain the management or other key employees of the acquired business;
our inability to establish uniform standards, controls, procedures and policies;
our inability to retain customers of our acquired companies;
risks associated with the internal controls of acquired companies;
exposure to legal claims for activities of the acquired business prior to the acquisition;
our due diligence procedures could fail to detect material issues related to the acquired business;
unforeseen management and operational difficulties, particularly if we acquire assets or businesses in new 
foreign jurisdictions where we have little or no operational experience;

14

• 

• 
• 

damage to our reputation as a result of performance or customer satisfaction problems relating to any acquired 
business;
the performance of any acquired business could be lower than we anticipated; and
our inability to enforce indemnifications and non-compete agreements.

The integration of any future acquisition into our business will likely require substantial time, effort, attention

and dedication of management resources and may distract our management in unpredictable ways from our ordinary
operations. The integration may also result in consolidation of certain existing operations. If we cannot successfully
execute on our investments on a timely basis, we may be unable to generate sufficient net sales to offset acquisition, 
integration or expansion costs, we may incur costs in excess of what we anticipate, and our expectations of future 
results of operations, including cost savings and synergies, may not be achieved. If we are not able to effectively
manage recent or future acquisitions or realize their anticipated benefits, it may harm our results of operations.

We rely on the continuous operation of our information technology systems. Failure to maintain or prevent damage to
such information technology systems or implement contemporary technology systems may adversely affect our business,
results of operations and customer relationships.

Our information technology systems allow us to accurately maintain books and records, record transactions,

provide information to management and prepare our consolidated financial statements. We may not have sufficient 
redundant operations to cover a loss or failure in a timely manner. Our operations depend on our network of information 
technology systems, which are vulnerable to damage from hardware failure, fire, power loss, telecommunications
failure, impacts of terrorism, cyber security vulnerabilities (such as threats and attacks), computer viruses, natural
disasters or other disasters. Any damage to our information technology systems could cause interruptions to our 
operations that materially adversely affect our ability to meet customers’ requirements, resulting in an adverse impact to
our business, financial condition and results of operations. Periodically, these systems need to be expanded, updated or 
upgraded as our business needs change. For example, we are in the process of implementing a new enterprise resource 
planning system in our Architectural business. In addition, we are increasingly using cloud-based technology to enable 
our customers a secure link to our systems in ways that enhance our customer relationships. We may not be able to 
successfully implement changes in our information technology systems without experiencing difficulties, which could 
require significant financial and human resources and impact our ability to efficiently service our customers. Moreover, 
our recent technological initiatives and increasing dependence on technology may exacerbate this risk.

Potential cyber threats and attacks could disrupt our information security systems and cause damage to our business
and our reputation.

Information security threats, which pose a risk to the security of our network of systems and the confidentiality

and integrity of our data, are increasing in frequency and sophistication. We have established policies, processes and 
multiple layers of defenses designed to help identify and protect against intentional and unintentional misappropriation
or corruption of our network of systems, including third party vendors' systems. Should damage to our network of 
systems occur, it could lead to the compromise of confidential information, manipulation and destruction of data and 
product specifications, production downtimes, disruption in the availability of financial data, or misrepresentation of 
information via digital media. While we have not experienced any material breaches in information security, the
occurrence of any of these events could adversely affect our reputation and could result in litigation, regulatory action, 
financial loss, project delay claims and increased costs and operational consequences of implementing further data 
protection systems.

Certain of our pension obligations are currently underfunded. We may have to make significant cash payments to our 
pension plans, which would reduce the cash available for our business.

As of December 29, 2019, our accumulated benefit obligations under our United Kingdom defined benefit 

pension plan exceeded the fair value of plan assets by $5.9 million. Our United States defined benefit pension plan is in 
a net funded status as plan assets exceeded our accumulated benefit obligations by $0.9 million, primarily due to higher 
returns on plan assets. During the years ended December 29, 2019, December 30, 2018 and December 31, 2017, we 
contributed $5.0 million each year to the United States pension plan and $1.3 million, $0.7 million and $1.0 million, 
respectively, to the United Kingdom pension plan. Additional contributions will be required in future years. We
currently anticipate making $5.0 million and $0.8 million of contributions to our United States and United Kingdom 
pension plans, respectively, in 2020. If the performance of the assets in our pension plans does not meet our 
expectations or other actuarial assumptions are modified, our contributions to our pension plans could be materially
higher than we expect, which would reduce the cash available for our businesses. 

15

 
 
 
 
We are exposed to political, economic and other risks that arise from operating a multinational business.

We have operations in the United States, Canada, Europe and, to a lesser extent, other foreign jurisdictions. In
the year ended December 29, 2019, approximately 68% of our net sales were in the United States, 14% in Canada and 
13% in the United Kingdom. Further, certain of our businesses obtain raw materials and finished goods from foreign
suppliers. Accordingly, our business is subject to political, economic and other risks that are inherent in operating in 
numerous countries.

These risks include:

• 
• 
• 
• 

• 
• 
• 

the difficulty of enforcing agreements and collecting receivables through foreign legal systems;
trade protection measures and import or export licensing requirements;
tax rates in foreign countries and the imposition of withholding requirements on foreign earnings;
the imposition of tariffs, such as those recently adopted by the United States and other jurisdictions, or other 
restrictions;
difficulty in staffing and managing widespread operations and the application of foreign labor regulations;
required compliance with a variety of foreign laws and regulations; and
changes in general economic and political conditions in countries where we operate.

Our business success depends in part on our ability to anticipate and effectively manage these and other risks. 
We cannot assure you that these and other factors will not have a material adverse effect on our international operations
or on our business as a whole. See also "Tariffs and evolving trade policy between the United States and other countries,
including China, may have an adverse effect on our business and results of operations."

Uncertainty relating to the United Kingdom's exit from the European Union could adversely affect our financial results.

In June 2016, voters in the United Kingdom voted in favor of the United Kingdom exiting the European Union

(“Brexit”). On January 31, 2020, the United Kingdom ceased to be part of the European Union. The impact of the 
United Kingdom's departure from, and future relationship with, the European Union are uncertain. The consequences 
for the economies of the European Union member states as a result of the United Kingdom's withdrawal from the
European Union are unknown and unpredictable. Any impact from Brexit on our business will depend, in part, on the
outcome of tariff, trade and other negotiations. If the ultimate terms of the United Kingdom’s exit from the European 
Union negatively impact the United Kingdom economy or result in disruptions to sales or our supply chain, the adverse 
impact to our results of operations, financial condition and cash flows could be material.

Since the United Kingdom triggered Brexit, there has been instability in global financial and foreign exchange

markets, including volatility in the value of the Pound Sterling and the Euro. Uncertainty about global or regional
economic conditions poses a risk as consumers and businesses may postpone spending in response to tighter credit, 
negative financial news and declines in income or asset values, which could have a material negative effect on the 
European housing market, particularly in the United Kingdom, and demand for our products. The effects of Brexit will 
depend upon any agreements the United Kingdom makes to retain access to European Union markets. It is possible that 
there will be higher tariffs or greater restrictions on imports and exports between the United Kingdom and the other 
European Union member states and increased regulatory complexities. These could potentially disrupt our supply chain,
access to human capital and sales to some of our target markets and jurisdictions in which we operate. The effects of 
Brexit could also lead to adverse changes in tax laws in these or other jurisdictions. Additionally, the movement of 
goods between the United Kingdom and the remaining European Union member states could be subject to additional
inspections and documentation checks, which could lead to possible delays at ports of entry and departure. Brexit could 
also lead to legal uncertainty and potentially divergent national laws and regulations, including environmental and other 
regulations currently under the European Union’s jurisdiction, which may or may not be replaced or replicated by the 
United Kingdom. Any of these effects of Brexit, and others we cannot anticipate, could have a material adverse impact 
on our results of operations, financial condition and cash flows.

Fluctuating exchange and interest rates could adversely affect our financial results.

Our financial results may be adversely affected by fluctuating exchange rates. Net sales generated outside of 

the United States were approximately 32% for the year ended December 29, 2019. In addition, a significant percentage 
of our costs during the same period were not denominated in U.S. dollars. For example, for most of our manufacturing
facilities, the prices for a significant portion of our raw materials are quoted in the domestic currency of the country 
where the facility is located or other currencies that are not U.S. dollars. We also have substantial assets outside the 

16

 
 
 
 
 
 
United States. As a result, the volatility in the price of the U.S. dollar has exposed, and in the future may continue to
expose, us to currency exchange risks. For example, we are subject to currency exchange rate risk to the extent that 
some of our costs will be denominated in currencies other than those in which we earn revenues. Also, since our 
financial statements are denominated in U.S. dollars, changes in currency exchange rates between the U.S. dollar and 
other currencies have had, and will continue to have, an impact on many aspects of our financial results. Changes in
currency exchange rates for any country in which we operate may require us to raise the prices of our products in that 
country and may result in the loss of business to our competitors that sell their products at lower prices in that country.

Moreover, as our current indebtedness is denominated in a currency that is different from the currencies in
which we derive a portion of our net sales, we are also exposed to currency exchange rate risk with respect to those
financial obligations. When the outstanding indebtedness is repaid, we may be subject to taxes on any corresponding 
foreign currency gain.

Borrowings under our current ABL Facility are incurred at variable rates of interest, which exposes us to
interest rate fluctuation risk. If interest rates increase, the payments we are required to make on any variable rate 
indebtedness will increase.

We may face claims that we infringe third party intellectual property rights, or be unable to protect our intellectual 
property from infringement by others except by incurring substantial costs as a result of litigation or other proceedings
relating to patent or trademark rights, any of which could cause our net sales or profitability to decline.

We rely on a combination of United States, Canadian and, to a lesser extent, European patent, trademark,

copyright and trade secret laws as well as licenses, nondisclosure, confidentiality and other contractual restrictions to 
protect certain aspects of our business. We have registered trademarks, copyrights and our patent and trademark 
applications may not be allowed by the applicable governmental authorities to issue as patents or register as trademarks 
at all, or in a form that will be advantageous to us. In addition, we have selectively pursued patent and trademark 
protection, and in some instances we may not have registered important patent and trademark rights in these and other 
countries. Furthermore, the laws of foreign countries may not protect our intellectual property rights to the same extent 
as the laws of the United States. The failure to obtain worldwide patent and trademark protection may result in other 
companies copying and marketing products based upon our technologies or under our brand or tradenames outside the
jurisdictions in which we are protected. This could impede our growth in existing regions and into new regions, create
confusion among consumers and result in a greater supply of similar products that could erode prices for our protected 
products.

Our success depends in part on our ability to protect our patents, trademarks, copyrights, trade secrets and 

licensed intellectual property from unauthorized use by others. We cannot be sure that the patents we have obtained, or 
other protections such as confidentiality, trade secrets and copyrights, will be adequate to prevent imitation of our 
products by others. If we are unable to protect our products through the enforcement of intellectual property rights, our 
ability to compete based on our current advantages may be harmed. If we fail to prevent substantial unauthorized use of 
our trade secrets, we risk the loss of those intellectual property rights and whatever competitive advantage they embody.

Although we are not aware that any of our products or intellectual property rights materially infringe upon the 

proprietary rights of third parties, third parties may accuse us of infringing or misappropriating their patents, 
trademarks, copyrights or trade secrets. Third parties may also challenge our trademark rights and branding practices in 
the future. We may be required to institute or defend litigation to defend ourselves from such accusations or to enforce 
our patent, trademark and copyright rights from unauthorized use by others, which, regardless of the outcome, could 
result in substantial costs and diversion of resources and could negatively affect our competitive position, sales, 
profitability and reputation. If we lose a patent infringement suit, we may be liable for money damages and be enjoined 
from selling the infringing product unless we can obtain a license or are able to redesign our product to avoid 
infringement. A license may not be available at all or on terms acceptable to us, and we may not be able to redesign our 
products to avoid any infringement, which could negatively affect our profitability. In addition, our patents, trademarks 
and other proprietary rights may be subject to various attacks claiming they are invalid or unenforceable. These attacks
might invalidate, render unenforceable or otherwise limit the scope of the protection that our patents and trademarks
afford. If we lose the use of a product name, our efforts spent building that brand may be lost and we will have to
rebuild a brand for that product, which we may or may not be able to do. Even if we prevail in a patent infringement 
suit, there is no assurance that third parties will not be able to design around our patents, which could harm our 
competitive position.

17

 
 
 
 
 
If we are unable to replace our expiring patents or fail to continue to innovate, our ability to compete both domestically
and internationally will be harmed. In addition, our products face the risk of obsolescence, which, if realized, could 
have a material adverse effect on our business.

Our continued success depends on our ability to develop and introduce new or improved products, to improve 

our manufacturing and product service processes and to protect our rights to the technologies used in our products. If 
we fail to do so, or if existing or future competitors achieve greater success than we do in these areas, our results of 
operations and our profitability may decline.

We depend on our door manufacturing intellectual property and products to generate revenue. Some of our 
patents will begin to expire in the next several years. While we will continue to work to add to our patent portfolio to
protect the intellectual property of our products, we believe it is possible that new competitors will emerge in door 
manufacturing. We do not know whether we will be able to develop additional proprietary designs, processes or 
products. If any protection we obtain is reduced or eliminated, others could use our intellectual property without 
compensating us, resulting in harm to our business. Moreover, as our patents expire, competitors may utilize the 
information found in such patents to commercialize their own products. While we seek to offset the losses relating to
important expiring patents by securing additional patents on commercially desirable improvements, and new products,
designs and processes, there can be no assurance that we will be successful in securing such additional patents, or that 
such additional patents will adequately offset the effect of the expiring patents.

Further, we face the risk that third parties will succeed in developing or marketing products that would render 

our products obsolete or noncompetitive. New, less expensive methods could be developed that replace or reduce the 
demand for our products or may cause our customers to delay or defer purchasing our products. Accordingly, our 
success depends in part upon our ability to respond quickly to market changes through the development and 
introduction of new products. The relative speed with which we can develop products, complete regulatory clearance or 
approval processes and supply commercial quantities of the products to the market are expected to be important 
competitive factors. Any delays could result in a loss of market acceptance and market share. We cannot provide
assurance that our new product development efforts will result in any commercially successful products.

We may be the subject of product liability claims or product recalls, we may not accurately estimate costs related to
such claims or recalls, and we may not have sufficient insurance coverage available to cover potential liabilities.

Our products are used and have been used in a wide variety of residential and architectural applications. We
face an inherent business risk of exposure to product liability or other claims, including class action lawsuits, in the 
event our products are alleged to be defective or that the use of our products is alleged to have resulted in harm to others
or to property. Because we manufacture a significant portion of our products based on the specific requirements of our 
customers, failure to provide our customers the products and services they specify could result in product-related claims
and reduced or cancelled orders and delays in the collection of accounts receivable. We may in the future incur expenses
if product liability lawsuits against us are successful. Moreover, any such lawsuits, whether or not successful, could 
result in adverse publicity to us, which could cause our sales to decline materially. In addition, it may be necessary for 
us to recall defective products, which would also result in adverse publicity, as well as resulting in costs connected to 
the recall and loss of net sales. We maintain insurance coverage to protect us against product liability claims, but that 
coverage may not be adequate to cover all claims that may arise or we may not be able to maintain adequate insurance
coverage in the future at an acceptable cost. Any liability not covered by insurance or that exceeds our established 
reserves could materially and adversely impact our financial condition and results of operations.

In addition, consistent with industry practice, we provide warranties on many of our products and we may 

experience costs of warranty or breach of contract claims if our products have defects in manufacture or design or they 
do not meet contractual specifications. We estimate our future warranty costs based on historical trends and product 
sales, but we may fail to accurately estimate those costs and thereby fail to establish adequate warranty reserves for 
them.

The loss of certain members of our management may have an adverse effect on our operating results.

Our success will depend, in part, on the efforts of our senior management and other key employees. These

individuals possess sales, marketing, engineering, manufacturing, financial and administrative skills and know-how that 
are critical to the operation of our business. If we lose or suffer an extended interruption in the services of one or more 
of our senior officers or other key employees, our financial condition and results of operations may be negatively 
affected. Moreover, the pool of qualified individuals may be highly competitive and we may not be able to attract and 

18

 
 
 
 
 
 
retain qualified personnel to replace or succeed members of our senior management or other key employees, should the
need arise. The loss of the services of any key personnel or our inability to hire new personnel with the requisite skills,
could impair our ability to develop new products or enhance existing products, sell products to our customers or manage
our business effectively.

As previously disclosed, the Company appointed Howard C. Heckes as President and Chief Executive Office

of the Company, effective, June 3, 2019. Mr. Heckes succeeded Frederick J. Lynch, our former President and Chief 
Executive Officer, who left the Board of Directors effective June 2, 2019, in connection with his previously disclosed 
retirement from the Company. Such leadership transitions can be inherently difficult to manage, and an inadequate
transition may cause disruption to our business, including to our relationships with our customers, suppliers and 
employees. It may also make it more difficult to hire and retain key employees.

To service our consolidated indebtedness, we will require a significant amount of cash. Our ability to generate cash 
depends on many factors beyond our control, and any failure to meet our debt service obligations could harm our 
business, financial condition and results of operations.

Our estimated annual payment obligation for 2020 with respect to our consolidated indebtedness is $44.1 

million of interest payments. When we draw funds under the ABL Facility, we incur additional interest expense. Our 
ability to pay interest on and principal of the senior notes and our ability to satisfy our other debt obligations will
principally depend upon our future operating performance. As a result, prevailing economic conditions and financial, 
business and other factors, many of which are beyond our control, will affect our ability to make these payments.

If we do not generate sufficient cash flow from operations to satisfy our consolidated debt service obligations,

we may have to undertake alternative financing plans, such as refinancing or restructuring our indebtedness, selling
assets, reducing or delaying capital investments or seeking to raise additional capital. Our ability to restructure or 
refinance our debt will depend on the capital markets and our financial condition at such time. Any refinancing of our 
debt could be at higher interest rates and may require us to comply with more onerous covenants, which could further 
restrict our business operations. In addition, the terms of existing or future debt instruments, including the ABL Facility
and the indenture governing the senior notes, may restrict us from adopting some of these alternatives. If we are unable
to generate sufficient cash flow to satisfy our debt service obligations, or to refinance our obligations on commercially
reasonable terms, it would have an adverse effect, which could be material, on our business, financial condition and 
results of operations.

Under such circumstances, we may be unable to comply with the provisions of our debt instruments, including 

the financial covenants in the ABL Facility. If we are unable to satisfy such covenants or other provisions at any future
time, we would need to seek an amendment or waiver of such financial covenants or other provisions. The lenders
under the ABL Facility may not consent to any amendment or waiver requests that we may make in the future, and, if 
they do consent, they may not do so on terms which are favorable to us. The lenders will also have the right in these 
circumstances to terminate any commitments they have to provide further borrowings. If we are unable to obtain any 
such waiver or amendment, our inability to meet the financial covenants or other provisions of the ABL Facility would 
constitute an event of default thereunder, which would permit the lenders to accelerate repayment of borrowings under 
the ABL Facility, which in turn would constitute an event of the default under the indenture governing the senior notes,
permitting the holders of the senior notes to accelerate payment thereon. Our assets and/or cash flow, and/or that of our 
subsidiaries, may not be sufficient to fully repay borrowings under our outstanding debt instruments if accelerated upon
an event of default, and the secured lenders under the ABL Facility could proceed against the collateral securing that 
indebtedness. Such events would have a material adverse effect on our business, financial condition and results of 
operations, as well as on our ability to satisfy our obligations in respect of the senior notes.

The terms of the ABL Facility and the indenture governing the senior notes may restrict our current and future
operations, particularly our ability to respond to changes in our business or to take certain actions.

The credit agreement governing the ABL Facility and the indentures governing the senior notes contain, and 

the terms of any future indebtedness of ours would likely contain, a number of restrictive covenants that impose
significant operating and financial restrictions, including restrictions on our ability to engage in acts that may be in our 
best long-term interests. The indentures governing the senior notes and the credit agreements governing the ABL 
Facility include covenants that, among other things, restrict our and our subsidiaries’ ability to:

incur additional indebtedness and issue disqualified or preferred stock;

• 
•  make restricted payments;

19

 
 
 
 
 
sell assets;
create restrictions on the ability of their restricted subsidiaries to pay dividends or distributions;
create or incur liens;
enter into sale and lease-back transactions;

• 
• 
• 
• 
•  merge or consolidate with other entities; and
• 

enter into transactions with affiliates.

The operating and financial restrictions and covenants in the debt agreements entered into in connection with
the ABL Facility and any future financing agreements may adversely affect our ability to finance future operations or 
capital needs or to engage in other business activities.

Lack of transparency, threat of fraud, public sector corruption and other forms of criminal activity involving 
government officials increases risk for potential liability under anti-bribery or anti-fraud legislation, including the
United States Foreign Corrupt Practices Act.

We operate facilities in eight countries and sell our products in 60 countries around the world. As a result of 

these international operations, we may enter from time to time into negotiations and contractual arrangements with
parties affiliated with foreign governments and their officials. In connection with these activities, we are subject to the
FCPA, the United Kingdom Bribery Act and other anti-bribery laws that prohibit improper payments or offers of 
payments to foreign governments and their officials and political parties by United States and other business entities for 
the purpose of obtaining or retaining business, or otherwise receiving discretionary favorable treatment of any kind and 
requires the maintenance of internal controls to prevent such payments. In particular, we may be held liable for actions 
taken by our local partners and agents in foreign countries where we operate, even though such parties are not always
subject to our control. As part of our Masonite Values Operating Guide, we have established FCPA and other anti-
bribery policies and procedures and offer several channels for raising concerns in an effort to comply with applicable 
U.S. and international laws and regulations. However, there can be no assurance that our policies and procedures will
effectively prevent us from violating these laws and regulations in every transaction in which we may engage. Any
determination that we have violated the FCPA or other anti-bribery laws (whether directly or through acts of others, 
intentionally or through inadvertence) could result in sanctions that could have a material adverse effect on our results
of operations and financial condition.

As we continue to expand our business globally, we may have difficulty anticipating and effectively managing

these and other risks that our international operations may face, which may adversely impact our business outside of 
North America and our financial condition and results of operations. In addition, any acquisition of businesses with
operations outside of North America may exacerbate this risk.

Environmental requirements and other government regulation may impose significant environmental and legal 
compliance costs and liabilities on us.

Our operations are subject to numerous Canadian (federal, provincial and local), United States (federal, state
and local), European (European Union, national and local) and other laws and regulations relating to pollution and the 
protection of human health and the environment, including, without limitation, those governing emissions to air,
discharges to water, storage, treatment and disposal of waste, releases of contaminants or hazardous or toxic substances, 
remediation of contaminated sites and protection of worker health and safety. From time to time, our facilities are 
subject to investigation by governmental regulators. Despite our efforts to comply with environmental requirements, we
are at risk of being subject to civil, administrative or criminal enforcement actions, of being held liable, of being subject 
to an order or of incurring costs, fines or penalties for, among other things, releases of contaminants or hazardous or 
toxic substances occurring on or emanating from currently or formerly owned or operated properties or any associated 
offsite disposal location, or for contamination discovered at any of our properties from activities conducted by us or by 
previous occupants. Although, with the exception of costs incurred relating to compliance with Maximum Achievable
Control Technology requirements (as described below), we have not incurred significant costs for environmental
matters in prior years, future expenditures required to comply with any changes in environmental requirements are 
anticipated to be undertaken as part of our ongoing capital investment program, which is primarily designed to improve
the efficiency of our various manufacturing processes. The amount of any resulting liabilities, costs, fines or penalties
may be material.

In addition, the requirements of such laws and enforcement policies have generally become more stringent 

over time. Changes in environmental laws and regulations or in their enforcement or the discovery of previously
unknown or unanticipated contamination or non-compliance with environmental laws or regulations relating to our 

20

 
 
 
 
 
properties or operations could result in significant environmental liabilities or costs which could adversely affect our 
business. In addition, we might incur increased operating and maintenance costs and capital expenditures and other 
costs to comply with increasingly stringent air emission control laws or other future requirements (such as, in the United 
States, those relating to compliance with Maximum Achievable Control Technology requirements under the Clean Air 
Act, for which we made capital expenditures totaling approximately $49 million from 2008 through 2010), which may 
decrease our cash flow. Also, discovery of currently unknown or unanticipated conditions could require responses that 
would result in significant liabilities and costs. Accordingly, we are unable to predict the ultimate costs of compliance 
with or liability under environmental laws, which may be larger than current projections.

Changes in government regulation may have a material effect on our results of operations.

Our manufacturing facilities and components of our products are subject to numerous foreign, federal, state 

and local laws and regulations, including those relating to the presence of hazardous materials and protection of worker 
health and safety. Liability under these laws involves inherent uncertainties. Changes in such laws and regulations or in 
their enforcement could significantly increase our costs of operations which could adversely affect our business.
Violations of health and safety laws are subject to civil, and, in some cases, criminal sanctions. As a result of these 
uncertainties, we may incur unexpected interruptions to operations, fines, penalties or other reductions in income which
could adversely impact our business, financial condition and results of operations.

Further, in order for our products to obtain the energy efficient “ENERGYSTAR” label, they must meet certain 

requirements set by the Environmental Protection Agency ("EPA)". Changes in the energy efficiency requirements
established by the EPA for the ENERGYSTAR label could increase our costs, and, if there is a lapse in our ability to
label our products as such or we are not able to comply with the new standards at all, negatively affect our net sales and 
results of operations.

Moreover, many of our products are regulated by building codes and require specific fire, penetration or wind 

resistance characteristics. A change in the building codes could have a material impact on the manufacturing cost for 
these products, which we may not be able to pass on to our customers.

In addition, changing laws, regulations and standards relating to corporate governance and public disclosure,

including the Sarbanes-Oxley Act, the Dodd-Frank Act and related regulations implemented by the Securities and 
Exchange Commission ("SEC"), and the stock exchanges are creating uncertainty for public companies, increasing legal
and financial compliance costs and making some activities more time-consuming. We are currently evaluating and 
monitoring developments with respect to new and proposed rules and cannot predict or estimate the amount of 
additional costs we may incur or the timing of such costs. These laws, regulations and standards are subject to varying 
interpretations, in many cases due to their lack of specificity, and, as a result, their application in practice may evolve
over time as new guidance is provided by regulatory and governing bodies. This could result in continuing uncertainty
regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance 
practices.

We intend to invest resources to comply with evolving laws, regulations and standards, and this investment 
may result in increased general and administrative expenses and a diversion of management’s time and attention from
revenue-generating activities to compliance activities. If our efforts to comply with new laws, regulations and standards
differ from the activities intended by regulatory or governing bodies due to ambiguities related to practice, regulatory 
authorities may initiate legal proceedings against us and our business may be harmed. We also expect that being a 
public company and these new rules and regulations will make it more expensive for us to obtain director and officer 
liability insurance, and we may be required to accept reduced coverage or incur substantially higher costs to obtain
coverage. These factors could also make it more difficult for us to attract and retain qualified members of our board of 
directors, particularly to serve on our audit committee and compensation committee, and attract and retain qualified 
executive officers.

21

Item 1B. Unresolved Staff Comments

None.

Item 2. Properties

Our United States executive headquarters are located in Tampa, Florida, and consist of approximately 80,000

square feet of leased office space at two sites. Our Canadian executive offices are located in a single leased site in 
Concord, Ontario. As of December 29, 2019, we owned and leased the following number of properties, by reportable
segment:

Manufacturing
and Distribution

Warehouse

Support

Total

Owned properties:

North American Residential

Europe

Architectural

Corporate & Other

Total owned properties

Leased properties:

North American Residential

Europe

Architectural

Corporate & Other
Total leased properties

Total owned and leased properties

19

6

9

—
34

19

4

5

1

29

63

6

—

—

—
6

15

8

8

—

31

37

—

1

—

1
2

1

1

2

4

8

10

25

7

9

1
42

35

13

15

5

68

110

Our properties in the North American Residential and Architectural segments are distributed across 28 states in 

the United States and four provinces in Canada, as well as two manufacturing facilities in Mexico and three
manufacturing facilities in Chile. Our properties in the Europe segment are distributed across the United Kingdom, as
well as one manufacturing facility in Ireland and two in the Czech Republic. Our material properties in the Corporate
and Other category include one manufacturing facility in Malaysia and four support facilities in the United States. As of 
December 29, 2019, total floor space at our manufacturing facilities was 12.2 million square feet, including 3.2 million 
square feet in our five molded door facings facilities. In addition to the properties outlined above, we lease two idle 
manufacturing facilities in the United States and own 17,000 acres of forestland in Costa Rica and 48 acres of 
undeveloped land in California. 

We believe that our facilities are suitable to our respective businesses and have production capacity adequate to 

support our current level of production to meet our customers’ demand. Additional investments in manufacturing
facilities are made as appropriate to balance our capacity with our customers’ demand.

Item 3. Legal Proceedings

The information required with respect to this item can be found under "Commitments and Contingencies" in 

Note 10 to the consolidated financial statements in this Annual Report and is incorporated by reference into this Item 3.

Item 4. Mine Safety Disclosures

Not applicable.

Information about our Executive Officers

Information about the Company's executive officers is incorporated herein by reference from Part III, Item 10

hereof.

22

PART II

Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity 
Securities

Market Information

Our common shares have been listed on the New York Stock Exchange (“NYSE”) under the symbol “DOOR” 

since September 9, 2013.

Holders

As of February 20, 2020, we had three record holders of our common shares, including Cede & Co., the 

nominee of the Depository Trust Corporation.

Dividends

We do not intend to pay any cash dividends on our common shares for the foreseeable future and instead may
retain earnings, if any, for future operations and expansion, share repurchases or debt repayments, among other things. 
Any decision to declare and pay dividends in the future will be made at the discretion of our Board of Directors and will
depend on, among other things, our results of operations, liquidity requirements, financial condition, contractual
restrictions and other factors that our Board of Directors may deem relevant. In addition, our ability to pay dividends is
limited by covenants in our ABL Facility and in the indenture governing our senior notes. Future agreements may also
limit our ability to pay dividends. See Note 9 to our audited consolidated financial statements contained elsewhere in 
this Annual Report for restrictions on our ability to pay dividends.

23

 
 
 
Stock Performance Graph

The following graph depicts the total return to shareholders from December 28, 2014, through December 29,

2019, relative to the performance of the Standard & Poor's 500 Index and the Standard & Poor's 1500 Building Products
Index. The graph assumes an investment of $100 in our common stock and each index on December 28, 2014, and the 
reinvestment of dividends paid since that date. The stock performance shown in the graph is not necessarily indicative 
of future price performance.

Comparison of Cumulative Total Stockholder Return 
Masonite International Corporation, Standard & Poor's 500 Index and 
Standard & Poor's 1500 Building Products Index
(Performance Results through December 29, 2019)

Masonite International
Corporation

Standard & Poor's 500
Index

Standard & Poor's 1500
Building Products Index

December 28,
2014

January 3, 
2016

January 1, 
2017

December 31,
2017

December 30,
2018

December 29,
2019

$

100.00

$

100.64

$

108.15

$

121.88

$

75.46

$

118.10

100.00

100.00

101.38

110.80

113.51

134.66

138.29

160.25

132.23

121.01

173.86

173.66

Recent Sales of Unregistered Securities; Use of Proceeds from Registered Securities

None.

24

Repurchases of Equity Securities by the Issuer and Affiliated Purchasers

During the three months ended December 29, 2019, we repurchased 22,110 of our common shares in the open 

market.

Total Number
of Shares
Purchased as
Part of
Publicly
Announced
Plans or
Programs

Approximate
Dollar Value
of Shares that
May Yet be
Purchased
Under the
Plans or
Programs

Total Number
of Shares
Purchased

Average Price
Paid per Share

September 30, 2019, through October 27, 2019

October 28, 2019, through November 24, 2019

November 25, 2019, through December 29, 2019

Total

— $

—

22,110

22,110

$

—

—

70.77

70.77

— $ 145,610,088

—

145,610,088

22,110

22,110

144,045,440

We currently have in place a $600.0 million share repurchase authorization, stemming from three separate 

authorizations by our Board of Directors. On February 23, 2016, our Board of Directors authorized a share repurchase
program whereby we may repurchase up to $150.0 million worth of our outstanding common shares, and on February
22, 2017, and May 10, 2018, our Board of Directors authorized an additional $200.0 million and $250.0 million, 
respectively (collectively, the “share repurchase programs”). The share repurchase programs have no specified end date 
and the timing and amount of any share repurchases will be determined by management based on our evaluation of 
market conditions and other factors. Any repurchases under the share repurchase programs may be made in the open
market, in privately negotiated transactions or otherwise, subject to market conditions, applicable legal requirements
and other relevant factors. The share repurchase programs do not obligate us to acquire any particular amount of 
common shares, and they may be suspended or terminated at any time at our discretion. Repurchases under the share 
repurchase programs are permitted to be made under one or more Rule 10b5-1 plans, which would permit shares to be
repurchased when we might otherwise be precluded from doing so under applicable insider trading laws. As of 
December 29, 2019, $144.0 million was available for repurchase in accordance with the share repurchase programs. 

25

 
 
Item 6. Selected Financial Data

The following table sets forth selected historical consolidated financial data as of the dates and for the periods
indicated. The selected historical consolidated financial data as of December 29, 2019, and December 30, 2018, and for 
the years ended December 29, 2019, December 30, 2018, and December 31, 2017, have been derived from the audited 
consolidated financial statements included elsewhere in this Annual Report. The selected historical consolidated 
financial data as of December 31, 2017, January 1, 2017, and January 3, 2016, and for the years ended January 1, 2017, 
and January 3, 2016, have been derived from the audited consolidated financial statements not included in this Annual
Report.

This historical data includes, in the opinion of management, all adjustments necessary for a fair presentation of 

the operating results and financial condition of the Company for such periods and as of such dates. The results of 
operations for any period are not necessarily indicative of the results of future operations. During the periods included 
below, we have completed several acquisitions and dispositions. The results of these acquired entities are included in 
our consolidated statements of comprehensive income (loss) for the periods subsequent to their respective acquisition
dates. The results of these disposed entities are included in our consolidated statements of comprehensive income (loss) 
for the periods up to their respective disposal dates. The selected historical consolidated financial data set forth below 
should be read in conjunction with, and are qualified by reference to, “Management’s Discussion and Analysis of 
Financial Condition and Results of Operations” and our consolidated financial statements and related notes thereto 
included elsewhere in this Annual Report.

(In thousands of U.S. dollars, except for share
and per share amounts)

December 29,
2019

December 30,
2018

December 31,
2017

January 1,
2017

January 3,
2016

Year Ended

Operating Results:

Net sales

$

2,176,683

$

2,170,103

$

2,032,925

$

1,973,964

$

1,871,965

Gross profit
Net income (loss) (1)
Net income (loss) attributable to Masonite (1)
Basic earnings per common share attributable
to Masonite

Diluted earnings per common share
attributable to Masonite

477,683

49,039

44,602

1.77

1.75

435,306

96,544

92,710

3.38

3.33

406,983

156,981

151,739

5.18

5.09

409,645

104,142

98,622

3.25

3.17

350,850

(42,649)

(47,111)

(1.56)

(1.56)

Cash Flow Data:

Capital expenditures

Balance Sheet Data:
Working capital (2)
Total assets (3)
Total debt (4)
Total equity

82,720

82,380

73,782

82,287

51,065

466,388

1,936,584

790,984

636,862

451,287

1,778,465

796,398

622,305

499,745

1,680,258

625,657

735,902

347,559

1,475,861

470,745

659,776

326,428

1,499,149

468,856

655,566

____________
(1) Refer to Footnote 9. Long-Term Debt, Footnote 13. Restructuring, Footnote 14. Asset Impairment, and Footnote 15. Income Taxes, in Item 8 of this 
Annual Report for information relating to material drivers of year over year changes in our earnings.

(2) Working capital is defined as current assets less current liabilities and includes cash restricted by letters of credit.

(3) Primary drivers of year over year fluctuations in total assets include acquisitions, the adoption of ASU 2016-02 "Leases (Topics 842)", asset 
impairments and changes in deferred tax assets, amongst others. Refer to Footnotes 1. Business Overview and Significant Accounting Policies, 2.
Acquisitions and Dispositions, 6. Leases, 14. Asset Impairment, and 15. Income Taxes, in Item 8 of this Annual Report for additional information on
these drivers.

TT

(4) Refer to Footnote 9. Long-Term Debt, in Item 8 of this Annual Report for information regarding year over year changes in our levels of 
indebtedness.

uu

26

 
 
MASONITE INTERNATIONAL CORPORATION

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 

("MD&A") is based upon accounting principles generally accepted in the United States of America and discusses the 
financial condition and results of operations for Masonite International Corporation for the years ended December 29,
2019, and December 30, 2018. For further discussion of our results of operations for the years ended December 30,
2018, and December 31, 2017, see “Management’s Discussion and Analysis of Financial Condition and Results of 
Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 30, 2018, which was
filed with the SEC on February 26, 2019. In this MD&A, "Masonite," "we," "us," "our" and the "Company" refer to 
Masonite International Corporation and its subsidiaries. 

This discussion should be read in conjunction with the consolidated financial statements and related notes 

included elsewhere in this Annual Report on Form 10-K. The following discussion should also be read in conjunction 
with the disclosure under "Special Note Regarding Forward Looking Statements" and Part I, Item 1A, "Risk Factors" 
elsewhere in this Annual Report on Form 10-K. Our actual results could differ materially from the forward-looking 
statements as a result of these risks and uncertainties.

Overview

We are a leading global designer, manufacturer and distributor of interior and exterior doors for the new 

construction and repair, renovation and remodeling sectors of the residential and non-residential building construction
markets. Since 1925, we have provided our customers with innovative products and superior service at compelling
values. In order to better serve our customers and create sustainable competitive advantages, we focus on developing
innovative products, advanced manufacturing capabilities and technology-driven sales and service solutions.

We market and sell our products to remodeling contractors, builders, homeowners, retailers, dealers,
lumberyards, commercial and general contractors and architects through well-established wholesale, retail and direct 
distribution channels as part of our cross-merchandising strategy. Customers are provided a broad product offering of 
interior and exterior doors and entry systems at various price points. We manufacture a broad line of interior doors, 
including residential molded, flush, stile and rail, louver and specially-ordered commercial and architectural doors; door 
components for internal use and sale to other door manufacturers; and exterior residential steel, fiberglass and wood 
doors and entry systems.

We operate 63 manufacturing and distribution facilities in eight countries in North America, South America, 
Europe and Asia, which are strategically located to serve our customers through multiple distribution channels. These
distribution channels include: (i) direct distribution to retail home center customers; (ii) one-step distribution that sells
directly to homebuilders and contractors; and (iii) two-step distribution through wholesale distributors. For retail home 
center customers, numerous door fabrication facilities provide value-added fabrication and logistical services, including 
pre-finishing and store delivery of pre-hung interior and exterior doors. We believe our ability to provide: (i) a broad 
product range; (ii) frequent, rapid, on-time and complete delivery; (iii) consistency in products and merchandising; (iv) 
national service; and (v) special order programs enables retail customers to increase comparable store sales and helps to
differentiate us from our competitors. We believe investments in innovative new product manufacturing and distribution
capabilities, coupled with an ongoing commitment to operational excellence, provide a strong platform for future growth.

Our reportable segments are currently organized and managed principally by end market: North American 

Residential, Europe and Architectural. In the year ended December 29, 2019, we generated net sales of $1,465.8 million 
or 67.3%, $321.6 million or 14.8% and $365.3 million or 16.8% in our North American Residential, Europe and 
Architectural segments, respectively. See "Segment Information" below for a description of our reportable segments.

27

MASONITE INTERNATIONAL CORPORATION

Key Factors Affecting Our Results of Operations 

Product Demand 

There are numerous factors that influence overall market demand for our products. Demand for new homes, 

home improvement products and other building construction products have a direct impact on our financial condition and 
results of operations. Demand for our products may be impacted by changes in United States, Canadian, European, Asian 
or other global economic conditions, including inflation, deflation, interest rates, availability of capital, consumer 
spending rates, energy availability and costs, and the effects of governmental initiatives to manage economic conditions. 
Additionally, trends in residential new construction, repair, renovation and remodeling and architectural building
construction may directly impact our financial performance. Accordingly, the following factors may have a direct impact 
on our business in the countries and regions in which our products are sold:

• 
• 
• 
• 
• 
• 
• 
• 
• 

the strength of the economy;
the amount and type of residential and commercial construction;
housing sales and home values;
the age of existing home stock, home vacancy rates and foreclosures;
non-residential building occupancy rates;
increases in the cost of raw materials or wages or any shortage in supplies or labor;
the availability and cost of credit;
employment rates and consumer confidence; and
demographic factors such as immigration and migration of the population and trends in household 
formation.

Additionally, the United Kingdom's exit from the European Union has created uncertainty in European demand,
particularly in the United Kingdom, which could have a material adverse effect on the demand for our products in the 
foreseeable future.

Product Pricing and Mix 

The building products industry is highly competitive and we therefore face pressure on sales prices of our 
products. In addition, our competitors may adopt more aggressive sales policies and devote greater resources to the
development, promotion and sale of their products than we do, which could result in a loss of customers. Our business in
general is subject to changing consumer and industry trends, demands and preferences. Trends within the industry
change often and our failure to anticipate, identify or quickly react to changes in these trends could lead to, among other 
things, rejection of a new product line and reduced demand and price reductions for our products, which could materially 
adversely affect us. Changes in consumer preferences may also lead to increased demand for our lower margin products
relative to our higher margin products, which could reduce our future profitability. 

In the fourth quarter of 2019, we communicated price increases that became effective on February 3, 2020, to 
our North American Residential customers that, for certain products, were significantly greater than our typical annual 
increases. We also communicated our intent to incrementally invest $100 million over the next five years in the areas of 
service and quality improvements, product innovation and end user marketing. While we believe that these initiatives are
necessary in order to increase the profile of, and demand for, our products and that they will benefit both us and our 
customers, we cannot predict whether our efforts will ultimately be successful or how our customers will react to these
initiatives which could have a material impact on demand and, consequently, our results of operations for future periods.

Business Wins and Losses

Our customers consist mainly of wholesalers and retail home centers. In fiscal year 2019, our top ten customers 

together accounted for approximately 43% of our net sales and our top customer, The Home Depot, Inc. accounted for 
approximately 17% of our net sales in fiscal year 2019. Net sales from customers that have accounted for a significant 
portion of our net sales in past periods, individually or as a group, may not continue in future periods, or if continued,
may not reach or exceed historical levels in any period. Certain customers perform periodic product line reviews to
assess their product offerings, which have, on past occasions, led to business wins and losses. In addition, as a result of 
competitive bidding processes, we may not be able to increase or maintain the margins at which we sell our products to 
our customers.

28

MASONITE INTERNATIONAL CORPORATION

Organizational Restructuring

Over the past several years, we have engaged in a series of restructuring programs related to exiting certain
geographies and non-core businesses, consolidating certain internal support functions and engaging in other actions 
designed to reduce our cost structure and improve productivity. These initiatives primarily consist of severance actions
and lease termination costs. Management continues to evaluate our business; therefore, in future years, there may be
additional provisions for new plan initiatives, as well as changes in previously recorded estimates, as payments are made 
or actions are completed. Asset impairment charges were also incurred in connection with these restructuring actions for 
those assets sold, abandoned or made obsolete as a result of these programs.

In February 2019, we began implementing a plan to improve overall business performance that includes the
reorganization of our manufacturing capacity and a reduction of our overhead and selling, general and administration 
workforce across all of our reportable segments and in our head offices. The reorganization of our manufacturing 
capacity involves specific plants in the North American Residential and Architectural segments and costs associated with 
the closure of these plants and related headcount reductions began taking place in the first quarter of 2019 (collectively,
the "2019 Plan"). Costs associated with the 2019 Plan include severance, retention and closure charges and will continue 
through 2020. Additionally, the plan to divest non-core assets was determined to be a triggering event requiring a test of 
the carrying value of the definite-lived assets relating to the divestitures, as further described in Note 14. In the fourth
quarter of 2019, we initiated additional restructuring actions related to both manufacturing capacity and reduction of our 
overhead and selling, general and administration workforce. Once fully implemented, the actions taken as part of the
2019 Plan are expected to increase our annual earnings and cash flows by approximately $17 to 21 million.

During the fourth quarter of 2018, we began implementing a plan to reorganize and consolidate certain aspects

of our United Kingdom head office function and optimize our portfolio by divesting non-core assets to enable more 
effective and consistent business processes in the Europe segment. In addition, in the North American Residential 
segment we announced a new facility that will optimize and expand capacity through increased automation, which
resulted in the closure of one existing facility and related headcount reductions beginning in the second quarter of 2019
(collectively, the “2018 Plan”). Costs associated with the 2018 Plan included severance, retention and closure charges 
and continued throughout 2019. Additionally, the plan to divest non-core assets was determined to be a triggering event 
requiring a test of the carrying value of the definite-lived assets relating to the divestitures, as further described in Note
14. Once fully implemented, the actions taken as part of the 2018 Plan are expected to increase our annual earnings and 
cash flows by approximately $6 million.

Inflation

An increase in inflation could have a significant impact on the cost of our raw material inputs. Wage inflation,
increased prices for raw materials or finished goods used in our products, tariffs and/or interruptions in deliveries of raw
materials or finished goods could adversely affect our profitability, margins and net sales, particularly if we are not able 
to pass these incurred costs on to our customers. In addition, interest rates normally increase during periods of rising 
inflation. Historically, as interest rates increase, demand for new homes and home improvement products decreases.

Seasonality

Our business is moderately seasonal and our net sales vary from quarter to quarter based upon the timing of the

building season in our markets. Severe weather conditions in any quarter, such as unusually prolonged warm or cold 
conditions, rain, blizzards or hurricanes, could accelerate, delay or halt construction and renovation activity.

Acquisitions and Dispositions

We are pursuing a strategic initiative of optimizing our global business portfolio. As part of this strategy, in the
last several years we have pursued strategic acquisitions targeting companies who produce components for our existing
operations, manufacture niche products and provide value-added services. Additionally, we target companies with strong
brands, complementary technologies, attractive geographic footprints and opportunities for cost and distribution
synergies. We also continuously analyze our operations to determine which businesses, market channels and products 
create the most value for our customers and acceptable returns for our shareholders.

29

 
 
MASONITE INTERNATIONAL CORPORATION

Acquisitions

•  Top Doors: On August 29, 2019, we completed the acquisition of TOPDOORS, s.r.o. ("Top Doors") based 
in the Czech Republic for cash consideration of $1.8 million, net of cash acquired, following a post-closing 
adjustment. Top Doors is a specialist manufacturer of door frames.

•  BWI: On November 1, 2018, we completed the acquisition of the operating assets of Bridgewater 

Wholesalers Inc. (“BWI”) for cash consideration of $22.3 million, net of cash acquired, and subject to
certain customary post-closing adjustments. BWI is headquartered in Branchburg, New Jersey, and is a
fabricator and distributor of residential interior and exterior door systems, supporting customers in the Mid-
Atlantic and Northeastern United States. Their product offerings include residential interior and exterior 
doors, commercial doors and hardware as well as value-added pre-finishing services.

•  Graham and Maiman: On June 1, 2018, we completed the acquisition of the operating assets of the wood 
door companies of AADG, Inc., including the brands Graham Manufacturing Corporation and The Maiman
Company (collectively, "Graham & Maiman"). We acquired the operating assets of Graham & Maiman for 
cash consideration of $39.0 million. Graham & Maiman are based in Mason City, Iowa, and Springfield, 
Missouri. Graham & Maiman provide the non-residential construction industry with a full range of 
architectural premium and custom grade flush wood doors, architectural stile and rail wood doors, thermal-
fused flush wood doors and wood door frames.

•  DW3: On January 29, 2018, we completed the acquisition of DW3 Products Holdings Limited (“DW3”), a 
leading United Kingdom provider of high quality premium door solutions and window systems, supplying
products under brand names such as Solidor, Residor, Nicedor and Residence. We acquired 100% of the 
equity interests in DW3 for consideration of $96.3 million, net of cash acquired. DW3 is based in Stoke-on-
Trent and Gloucester, England, and their products and service model are a natural addition to our existing
United Kingdom business. DW3’s online quick ship capabilities and product portfolio both complement 
and expand the strategies we are pursuing with our business.

•  A&F: On October 2, 2017, we completed the acquisition of A&F Wood Products, Inc. (“A&F”), through 

the purchase of 100% of the equity interests in A&F and certain assets of affiliates of A&F for 
consideration of $13.8 million, net of cash acquired. A&F is based in Howell, Michigan, and is a 
wholesaler and fabricator of architectural and commercial doors in the Midwest United States.

Dispositions

•  Window Widgets: On December 13, 2019, we completed the sale of all of the capital stock of Window 
Widgets Limited ("WW"), a leading United Kingdom provider of high quality window systems, for 
consideration of $1.2 million, net of cash disposed.

•  PDS: On March 21, 2019, we completed the sale of all of the capital stock of Performance Doorset 

Solutions Limited (“PDS”), a leading supplier of custom doors and millwork in the United Kingdom, for 
nominal consideration.

30

Results of Operations

MASONITE INTERNATIONAL CORPORATION

(In thousands)
Net sales
Cost of goods sold
Gross profit
Gross profit as a % of net sales
Selling, general and administration expenses
Selling, general and administration expenses as a % of net sales
Restructuring costs
Asset impairment
Loss on disposal of subsidiaries
Operating income
Interest expense, net
Loss on extinguishment of debt
Other expense (income), net
Income before income tax expense (benefit)
Income tax expense (benefit)
Net income
Less: net income attributable to non-controlling interests
Net income attributable to Masonite

$

December 29,
2019
2,176,683
1,699,000
477,683

Year Ended
December 30,
2018
2,170,103
1,734,797
435,306

$

$

December 31,
2017
2,032,925
1,625,942
406,983

21.9%

310,567

14.3%

9,776
13,767
14,260
129,313
46,489
14,523
1,953
66,348
17,309
49,039
4,437
44,602

$

20.1%

266,193

12.3%

1,624
5,243
—
162,246
39,008
5,414
(2,533)
120,357
23,813
96,544
3,834
92,710

$

20.0%

247,917

12.2%

850
—
212
158,004
30,153
—
(1,570)
129,421
(27,560)
156,981
5,242
151,739

$

Year Ended December 29, 2019, Compared with Year Ended December 30, 2018 

Net Sales

Net sales in the year ended December 29, 2019, were $2,176.7 million, an increase of $6.6 million or 0.3% from 
$2,170.1 million in the year ended December 30, 2018. Net sales in 2019 were negatively impacted by $22.8 million as a
result of foreign exchange rate fluctuations. Excluding this exchange rate impact, net sales would have increased by
$29.4 million or 1.4% due to changes in volume, average unit price and sales of components and other products. Average 
unit price in 2019 increased net sales by $111.5 million or 5.1% compared to 2018. Our 2018 acquisitions, net of 
dispositions, contributed $32.8 million or 1.5% of net sales in 2019. Lower volumes excluding the incremental impact of 
acquisitions ("base volume") decreased net sales by $105.8 million or 4.9% in 2019 compared to 2018. Net sales of 
components and other products to external customers were $9.1 million lower in 2019 compared to 2018.

Net Sales and Percentage of Net Sales by Reportable Segment

(In thousands)

Sales

Intersegment sales

Net sales to external customers
Percentage of consolidated
external net sales

Year Ended December 29, 2019

North
American
Residential

$ 1,469,194

(3,386)

$ 1,465,808

Europe

Architectural

Corporate &
Other

Total

$

$

323,137
(1,506)
321,631

$

$

380,300
(14,997)
365,303

$

$

23,941

—

23,941

$ 2,196,572
(19,889)
$ 2,176,683

67.3%

14.8%

16.8%

31

MASONITE INTERNATIONAL CORPORATION

Year Ended December 30, 2018

North
American
Residential

Europe

Architectural

Corporate &
Other

Total

$ 1,458,957
(4,198)

$ 1,454,759

$

$

371,069
(2,066)
369,003

$

$

340,609
(17,137)
323,472

$

$

22,869
—

22,869

$ 2,193,504
(23,401)
$ 2,170,103

67.0%

17.0%

14.9%

(In thousands)

Sales
Intersegment sales

Net sales to external customers
Percentage of consolidated
external net sales

North American Residential

Net sales to external customers from facilities in the North American Residential segment in the year ended 

December 29, 2019, were $1,465.8 million, an increase of $11.0 million or 0.8% from $1,454.8 million in the year ended 
December 30, 2018. Net sales in 2019 were negatively impacted by $6.6 million as a result of foreign exchange rate 
fluctuations. Excluding this exchange rate impact, net sales would have increased by $17.6 million or 1.2% due to 
changes in volume, average unit price and sales of components and other products. Average unit price increased net sales 
in 2019 by $78.5 million or 5.4% compared to 2018. Our 2018 acquisition of BWI contributed $38.9 million or 2.7% of 
net sales in 2019. Lower base volume decreased net sales by $93.2 million or 6.4% in 2019 compared to 2018. Net sales
of components and other products to external customers were $6.6 million lower in 2019 compared to 2018.

Europe

Net sales to external customers from facilities in the Europe segment in the year ended December 29, 2019,

were $321.6 million, a decrease of $47.4 million or 12.8% from $369.0 million in the year ended December 30, 2018.
Net sales in 2019 were negatively impacted by $15.2 million as a result of foreign exchange fluctuations. Excluding this
exchange rate impact, net sales would have decreased by $32.2 million or 8.7% due to changes in volume, average unit 
price and sales of components and other products. Net sales in 2019 were reduced by $30.3 million or 8.2% due to the 
net impact of acquisitions and dispositions, including lost sales due to the dispositions of three non-core businesses, 
partially offset by one month of incremental sales from the DW3 acquisition. Lower base volume in 2019 decreased net 
sales by $13.6 million or 3.7% compared to 2018. Average unit price increased net sales in 2019 by $13.2 million or 
3.6% compared to 2018. Net sales of components and other products to external customers were $1.5 million lower in 
2019 compared to 2018.

Architectural

Net sales to external customers from facilities in the Architectural segment in the year ended December 29,

2019, were $365.3 million, an increase of $41.8 million or 12.9% from $323.5 million in the year ended December 30,
2018. Net sales in 2019 were negatively impacted by $0.9 million as a result of foreign exchange fluctuations. Excluding
this exchange rate impact, net sales would have increased by $42.7 million or 13.2% due to changes in volume, average 
unit price and sales of components and other products. Our 2018 acquisition of Graham & Maiman contributed $24.2
million or 7.5% of net sales in 2019. Average unit price increased net sales in 2019 by $19.7 million or 6.1% compared 
to 2018. Higher base volume increased net sales in 2019 by $0.4 million or 0.1% compared to 2018. Net sales of 
components and other products to external customers were $1.6 million lower in 2019 compared to 2018.

Cost of Goods Sold

Our cost of goods sold is comprised of the cost to manufacture products for our customers and includes the cost 

of materials, direct labor, overhead, distribution and depreciation associated with assets used to manufacture products.
Research and development costs are primarily included within cost of goods sold. We incur significant fixed and variable
overhead at our global component locations that manufacture interior molded door facings. Our overall average 
production capacity utilization at these locations was approximately 73% for the year ended December 29, 2019, and 
77% for each of the years ended December 30, 2018, and December 31, 2017.

Cost of goods sold as a percentage of net sales was 78.1% and 79.9% for the years ended December 29, 2019, 
and December 30, 2018, respectively. Material cost of sales, direct labor costs and distribution costs as a percentage of 
net sales decreased by 2.2%, 0.4% and 0.1%, respectively, in 2019 compared to 2018. Partially offsetting these

32

MASONITE INTERNATIONAL CORPORATION

decreases, overhead and depreciation as a percentage of sales increased by 0.6% and 0.3% over the 2018 period. The
decrease in material cost of sales as a percentage of net sales was driven by higher average unit prices, partially offset by
increases due to inflation, including tariffs. Conversely, overhead as a percentage of net sales was negatively impacted by
charges related to plant damages and factory start-up costs and lower volumes in 2019 compared to 2018.

Selling, General and Administration Expenses

Selling, general and administration ("SG&A") expenses primarily include the costs for our sales organization

and support staff at various plants and corporate offices. These costs include personnel costs for payroll, related benefits
and stock based compensation expense; professional fees; depreciation and amortization of our non-manufacturing
equipment and assets; environmental, health and safety costs; advertising expenses and rent and utilities related to 
administrative office facilities. In the year ended December 29, 2019, selling, general and administration expenses, as a
percentage of net sales, were 14.3% compared to 12.3% in the year ended December 30, 2018, an increase of 200 basis 
points. 

Selling, general and administration expenses in the year ended December 29, 2019, were $310.6 million, an 
increase of $44.4 million from $266.2 million in the year ended December 30, 2018. SG&A expenses were positively 
impacted by favorable foreign exchange impacts of $2.8 million. Non-cash items drove an increase of $11.0 million,
including share based compensation, depreciation and amortization, deferred compensation and loss on disposal of 
property, plant and equipment including a $2.5 million charge related to the divestiture of a non-core business in the
Europe segment. Excluding these impacts, SG&A expenses would have increased by $36.2 million. The remaining
increase was driven by personnel cost increases of $22.6 million, primarily due to incentive compensation and resource
investments in our Architectural segment to facilitate acquisition integration and support growth, incremental SG&A 
expenses from our 2018 acquisitions of $7.6 million (net of dispositions), professional and other corporate costs of $3.3 
million, advertising costs of $1.5 million and other increases of $1.2 million.

Restructuring Costs

Restructuring costs in the year ended December 29, 2019, were $9.8 million, compared to $1.6 million in the 

year ended December 30, 2018. Restructuring costs in 2019 related to severance, retention and closure charges 
associated with the 2019 and 2018 Plans. Restructuring costs in 2018 related to severance, retention and closure charges 
associated with the 2018 Plan.

Asset Impairment

Asset impairment charges in the year ended December 29, 2019, were $13.8 million compared to $5.2 million 
in the year ended December 30, 2018. Asset impairment charges in 2019 resulted from actions associated with the 2019 
Plan. Asset impairment charges in 2018 resulted from actions associated with the 2018 Plan.

Loss on Disposal of Subsidiaries

Loss on disposal of subsidiaries represents the difference between proceeds received upon disposition and the
book value of a subsidiary which has been divested and was excluded from treatment as a discontinued operation. Also 
included in loss on disposal of subsidiaries is recognition of the cumulative translation adjustment out of accumulated 
other comprehensive loss. Loss on disposal of subsidiaries was $14.3 million in the year ended December 29, 2019.
There were no charges associated with the disposal of subsidiaries in the year ended December 30, 2018. The loss in the
current year was related to the sale of WW and PDS. WW was sold for consideration of $2.2 million, net of cash
disposed. PDS was sold for nominal consideration. Charges related to the disposition of WW and PDS consist of $8.3
million and $3.6 million, respectively, relating to the write-off of the net assets sold and other professional fees as well as
$1.4 million and $1.0 million, respectively, relating to the recognition of the cumulative translation adjustment out of 
accumulated other comprehensive loss.

Interest Expense, Net

Interest expense, net, in the year ended December 29, 2019, was $46.5 million, compared to $39.0 million in the

year ended December 30, 2018. This increase primarily relates to the issuance of $500.0 million aggregate principal
amount of 2028 Senior Notes on July 25, 2019 and $300.0 million aggregate principal amount of 2026 Senior Notes on 
September 27, 2018.

33

MASONITE INTERNATIONAL CORPORATION

Loss on Extinguishment of Debt

Loss on extinguishment of debt represents the difference between the reacquisition price of debt and the net 
carrying amount of the extinguished debt. The net carrying amount includes the principal, unamortized premium and 
unamortized debt issuance costs. Loss on extinguishment of debt was $14.5 million in the year ended December 29, 
2019, compared to $5.4 million in the year ended December 30, 2018. Loss on extinguishment of debt in the current year 
related to the redemption of our senior unsecured notes due 2023. This charge represents the difference between the 
redemption price of our senior unsecured notes due 2023 of $514.1 million and the net carrying amount of such notes of 
$499.6 million. In addition to the $500.0 million of principal, the redemption price included a make-whole premium of 
$14.1 million and the net carrying amount included unamortized debt issuance costs of $3.5 million, partially offset by
unamortized premiums of $3.1 million. Loss on extinguishment of debt in the prior year related to the partial redemption 
of our senior unsecured notes due 2023.

Other Expense (Income), Net

Other expense (income), net includes profits and losses related to our non-majority owned unconsolidated 

subsidiaries that we recognize under the equity method of accounting, unrealized gains and losses on foreign currency
remeasurements, pension settlement charges and other miscellaneous non-operating expenses. Other expense (income), 
net, in the year ended December 29, 2019, was $2.0 million of expense, compared to $2.5 million of income in the year 
ended December 30, 2018. The change in other expense (income), net, is primarily due to a pre-tax pension settlement 
charge of $5.7 million recognized in the fourth quarter, unrealized gains and losses on foreign currency remeasurements 
and other miscellaneous non-operating expenses.

Income Tax Expense (Benefit)

Our income tax expense in the year ended December 29, 2019, was $17.3 million, a change of $6.5 million 

from $23.8 million of income tax expense in the year ended December 30, 2018. The decrease in income tax expense is
primarily attributable to (i) the mix of income or losses within the tax jurisdictions with various tax rates in which we
operate offset by (ii) the increase in income tax expense in the United Kingdom due to nondeductible loss on disposal of 
subsidiaries.

Segment Information

Our reportable segments are organized and managed principally by end market: North American Residential,

Europe and Architectural. The North American Residential reportable segment is the aggregation of the Wholesale and 
Retail operating segments. The Europe reportable segment is the aggregation of the United Kingdom and the Central
Eastern Europe operating segments. The Architectural reportable segment consists solely of the Architectural operating 
segment. The Corporate & Other category includes unallocated corporate costs and the results of immaterial operating
segments which were not aggregated into any reportable segment. Operating segments are aggregated into reportable
segments only if they exhibit similar economic characteristics. In addition to similar economic characteristics we also 
consider the following factors in determining the reportable segments: the nature of business activities, the management 
structure directly accountable to our chief operating decision maker for operating and administrative activities, 
availability of discrete financial information and information presented to the Board of Directors and investors.

34

MASONITE INTERNATIONAL CORPORATION

Our management reviews net sales and Adjusted EBITDA (as defined below) to evaluate segment performance

and allocate resources. Net assets are not allocated to the reportable segments. Adjusted EBITDA is a non-GAAP 
financial measure which does not have a standardized meaning under GAAP and is unlikely to be comparable to similar 
measures used by other companies. Adjusted EBITDA should not be considered as an alternative to either net income or 
operating cash flows determined in accordance with GAAP. Adjusted EBITDA is defined as net income (loss) 
attributable to Masonite adjusted to exclude the following items: 

• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 

depreciation; 
amortization; 
share based compensation expense;
loss (gain) on disposal of property, plant and equipment; 
registration and listing fees;
restructuring costs;
asset impairment;
loss (gain) on disposal of subsidiaries;
interest expense (income), net; 
loss on extinguishment of debt;
other expense (income), net; 
income tax expense (benefit); 
loss (income) from discontinued operations, net of tax; and 
net income (loss) attributable to non-controlling interest. 

This definition of Adjusted EBITDA differs from the definitions of EBITDA contained in the indenture 

governing the 2028 and 2026 Notes and the credit agreement governing the ABL Facility. Adjusted EBITDA is used to
evaluate and compare the performance of the segments and it is one of the primary measures used to determine employee
incentive compensation. Intersegment sales are recorded using market prices. 

We believe that Adjusted EBITDA, from an operations standpoint, provides an appropriate way to measure and 

assess segment performance. Our management team has established the practice of reviewing the performance of each
segment based on the measures of net sales and Adjusted EBITDA. We believe that Adjusted EBITDA is useful to users
of the consolidated financial statements because it provides the same information that we use internally to evaluate and 
compare the performance of the segments and it is one of the primary measures used to determine employee incentive
compensation.

(In thousands)

Adjusted EBITDA
Adjusted EBITDA as a percentage of
segment net sales

(In thousands)

Adjusted EBITDA
Adjusted EBITDA as a percentage of
segment net sales

Year Ended December 29, 2019

North
American
Residential

Europe

Architectural

Corporate
& Other

Total

$

232,512

$

46,219

$

40,470

$

(35,817)

$

283,384

15.9%

14.4%

11.1%

13.0%

Year Ended December 30, 2018

North
American
Residential

Europe

Architectural

Corporate
& Other

Total

$

202,465

$

44,985

$

37,742

$

(17,256)

$

267,936

13.9%

12.2%

11.7%

12.3%

35

MASONITE INTERNATIONAL CORPORATION

The following reconciles Adjusted EBITDA to net income (loss) attributable to Masonite:

Adjusted EBITDA

$

232,512

$

46,219

$

40,470

$

(In thousands)

Net income (loss) attributable to
Masonite

Plus:

Depreciation

Amortization

Share based compensation expense

Loss on disposal of property, plant and
equipment

Restructuring costs

Asset impairment
Loss on disposal of subsidiaries

Interest expense, net

Loss on extinguishment of debt

Other expense (income), net

Income tax expense

Net income attributable to non-
controlling interest

(In thousands)

Net income (loss) attributable to
Masonite

Plus:

Depreciation
Amortization

Share based compensation expense

Loss on disposal of property, plant and
equipment

Restructuring costs

Asset impairment

Interest expense, net

Loss on extinguishment of debt

Other expense (income), net

Income tax expense

Net income attributable to non-
controlling interest

Year Ended December 29, 2019

North
American
Residential

Europe

Architectural

Corporate
& Other

Total

$

167,097

$

2,664

$

19,928

$

(145,087) $

44,602

35,992

1,697

—

3,934

6,929

13,767
—

—

—

—

—

3,096

11,604

14,653

—

2,109

1,322

—
14,260

—

—
(393)
—

—

11,343

8,362

—

331

506

—
—

—

—

—

—

—

11,797

4,401

10,023

22

1,019

—
—

46,489

14,523

2,346

17,309

70,736

29,113

10,023

6,396

9,776

13,767
14,260

46,489

14,523

1,953

17,309

1,341
(35,817) $

4,437

283,384

Year Ended December 30, 2018

North
American
Residential

Europe

Architectural

Corporate
& Other

Total

$

165,981

$

13,602

$

17,895

$

(104,768) $

92,710

29,959
1,466

—

1,799

275

—

—

—

(57)

—

3,042

9,922
14,716

—

92

1,349

5,243

—

—

61

—

—

10,431
9,236

—

180

—

—

—

—

—

—

—

8,777
3,165

7,681

1,399

—

—

39,008

5,414
(2,537)
23,813

59,089
28,583

7,681

3,470

1,624

5,243

39,008

5,414
(2,533)
23,813

792
(17,256) $

3,834

267,936

Adjusted EBITDA

$

202,465

$

44,985

$

37,742

$

36

MASONITE INTERNATIONAL CORPORATION

Adjusted EBITDA in our North American Residential segment increased $30.0 million, or 14.8%, to $232.5 

million in the year ended December 29, 2019, from $202.5 million in the year ended December 30, 2018. Adjusted 
EBITDA in the North American Residential segment included corporate allocations of shared costs of $55.9 million and 
$54.7 million in 2019 and 2018, respectively. The allocations generally consist of certain costs of human resources, legal,
finance, information technology, research and development and share based compensation. 

Adjusted EBITDA in our Europe segment increased $1.2 million, or 2.7%, to $46.2 million in the year ended 

December 29, 2019, from $45.0 million in the year ended December 30, 2018. Adjusted EBITDA in the Europe segment 
included corporate allocations of shared costs of $1.0 million in the year ended December 29, 2019. There were no such 
allocations in the year ended December 30, 2018. The allocations generally consist of certain costs of human resources, 
legal, finance and information technology.

Adjusted EBITDA in our Architectural segment increased $2.8 million or 7.4% to $40.5 million in the year 

ended December 29, 2019, from $37.7 million in the year ended December 30, 2018. Adjusted EBITDA in the 
Architectural segment also included corporate allocations of shared costs of $10.6 million and $8.9 million in 2019 and 
2018, respectively. The allocations generally consist of certain costs of human resources, legal, finance, information
technology and research and development.

Liquidity and Capital Resources

Our liquidity needs for operations vary throughout the year. Our principal sources of liquidity are cash flows 

from operating activities, the borrowings under our ABL Facility and an accounts receivable sales program with a third 
party ("AR Sales Program") and our existing cash balance. Our anticipated uses of cash in the near term include working
capital needs, capital expenditures and share repurchases. As of December 29, 2019, we do not have any material 
commitments for capital expenditures. We anticipate capital expenditures in fiscal year 2020 to be approximately $70
million to $75 million. On a continual basis, we evaluate and consider strategic acquisitions, divestitures and joint 
ventures to create shareholder value and enhance financial performance.

We believe that our cash balance on hand, future cash generated from operations, the use of our AR Sales

Program, our ABL Facility, and ability to access the capital markets will provide adequate liquidity for the foreseeable
future. As of December 29, 2019, we had $167.0 million of cash and cash equivalents, availability under our ABL 
Facility of $198.0 million and availability under our AR Sales Program of $12.4 million.

Cash Flows

Year Ended December 29, 2019, Compared with Year Ended December 30, 2018

Cash provided by operating activities was $221.7 million during the year ended December 29, 2019, compared 
to $203.2 million during the year ended December 30, 2018. This $18.5 million increase in cash provided by operating 
activities is primarily due to $16.0 million of net working capital improvements in 2019 compared to 2018.

Cash used in investing activities was $82.1 million during the year ended December 29, 2019, compared to 

$254.5 million cash used during the year ended December 30, 2018. This $172.4 million decrease in cash used in
investing activities was primarily driven by a decrease in cash paid for acquisitions of $155.4 million and a $12.0 million
decrease in cash paid in the issuance of a note receivable in 2019 compared to 2018. The remaining $5.0 million
decrease is a result of a $2.2 million increase in cash proceeds for the sale of property plant and equipment, decreases in
other investing outflows of $2.1 million, and a $1.0 million increase in cash obtained from the sale of subsidiaries in 
2019 compared to 2018, partially offset by a $0.3 million increase in capital expenditures.

Cash used in financing activities was $89.4 million during the year ended December 29, 2019, compared to

$10.0 million of cash used during the year ended December 30, 2018. This $79.4 million increase in cash used in 
financing activities was primarily driven by a $186.0 million net increase in cash used in debt-related transactions,
partially offset by a $107.0 million decrease in cash used for repurchases of common shares in 2019 compared to 2018.

37

 
 
 
MASONITE INTERNATIONAL CORPORATION

Share Repurchases

We currently have in place a $600.0 million share repurchase authorization, stemming from three separate 

authorizations by our Board of Directors. On February 23, 2016, our Board of Directors authorized a share repurchase
program whereby we may repurchase up to $150.0 million worth of our outstanding common shares and on February 22,
2017, and May 10, 2018, our Board of Directors authorized an additional $200.0 million and $250.0 million, respectively
(collectively, the “share repurchase programs”). The share repurchase programs have no specified end date and the
timing and amount of any share repurchases will be determined by management based on our evaluation of market 
conditions and other factors. Any repurchases under the share repurchase programs may be made in the open market, in
privately negotiated transactions or otherwise, subject to market conditions, applicable legal requirements and other 
relevant factors. The share repurchase programs do not obligate us to acquire any particular amount of common shares, 
and they may be suspended or terminated at any time at our discretion. Repurchases under the share repurchase programs
are permitted to be made under one or more Rule 10b5-1 plans, which would permit shares to be repurchased when we
might otherwise be precluded from doing so under applicable insider trading laws. During the year ended December 29,
2019, we repurchased and retired 1,170,925 of our common shares in the open market at an aggregate cost of $59.9 
million as part of the share repurchase programs. During the year ended December 30, 2018, we repurchased 2,771,684 
of our common shares in the open market at an aggregate cost of $166.9 million. As of December 29, 2019, $144.0
million was available for repurchase in accordance with the share repurchase programs.

Other Liquidity Matters

Our cash and cash equivalents balance includes cash held in foreign countries in which we operate. Cash held 

outside Canada, in which we are incorporated, is free from significant restrictions that would prevent the cash from being
accessed to meet our liquidity needs including, if necessary, to fund operations and service debt obligations in Canada. 
However, earnings from certain jurisdictions are indefinitely reinvested in those jurisdictions. Upon the repatriation of 
any earnings to Canada, in the form of dividends or otherwise, we may be subject to Canadian income taxes and 
withholding taxes payable to the various foreign countries. As of December 29, 2019, we do not believe adverse tax
consequences exist that restrict our use of cash or cash equivalents in a material manner.

We also routinely monitor the changes in the financial condition of our customers and the potential impact on

our results of operations. There has not been a change in the financial condition of a customer that has had a material
adverse effect on our results of operations. However, if economic conditions were to deteriorate, it is possible that there
could be an impact on our results of operations in a future period and this impact could be material.

Accounts Receivable Sales Program

Under the AR Sales Program, we can transfer ownership of eligible trade accounts receivable of certain
customers. Receivables are sold outright to a third party who assumes the full risk of collection, without recourse to us in 
the event of a loss. Transfers of receivables under this program are accounted for as sales. Proceeds from the transfers 
reflect the face value of the accounts receivable less a discount. Receivables sold under the AR Sales Program are 
excluded from trade accounts receivable in the consolidated balance sheets and are included in cash flows from operating
activities in the consolidated statements of cash flows. The discounts on the sales of trade accounts receivable sold under 
the AR Sales Program were not material for any of the periods presented and were recorded in selling, general and 
administration expense within the consolidated statements of comprehensive income.  

Senior Notes

On July 25, 2019, we issued $500.0 million aggregate principal senior unsecured notes (the "2028 Notes"). The

2028 Notes were issued in a private placement for resale to qualified institutional buyers pursuant to Rule 144A under 
the Securities Act of 1933, as amended (the "Securities Act"), and to buyers outside of the United States pursuant to 
Regulation S under the Securities Act. The 2028 Notes were issued without registration rights and are not listed on any
securities exchange. The 2028 Notes bear interest at 5.375% per annum, payable in cash semiannually in arrears on 
February 1 and August 1 of each year and are due February 1, 2028. The 2028 notes were issued at par. We received net 
proceeds of $493.3 million after deducting $6.7 million of debt issuance costs. The debt issuance costs were capitalized 
as a reduction to the carrying value of debt and are being accreted to interest expense over the term of the 2028 Notes
using the effective interest method. The net proceeds from issuance of the 2028 Notes, together with available cash
balances, were used to redeem the remaining $500.0 million aggregate principal amount of the 2023 Notes (as described 
below), including the payment of related premiums, fees and expenses. 

38

MASONITE INTERNATIONAL CORPORATION

Obligations under the 2028 Notes are fully and unconditionally guaranteed, jointly and severally, on a senior 

unsecured basis, by certain of our directly or indirectly wholly-owned subsidiaries. We may redeem the 2028 Notes
under certain circumstances specified therein. The indenture governing the 2028 Notes contains restrictive covenants
that, among other things, limit our ability and the ability of our subsidiaries to: (i) incur additional debt and issue
disqualified or preferred stock, (ii) make restricted payments, (iii) sell assets, (iv) create or permit restrictions on the 
ability of our restricted subsidiaries to pay dividends or make other distributions to the parent company, (v) create or 
incur certain liens, (vi) enter into sale and leaseback transactions, (vii) merge or consolidate with other entities and (viii)
enter into transactions with affiliates. The foregoing limitations are subject to exceptions as set forth in the indenture
governing the 2028 Notes. In addition, if in the future the 2028 Notes have an investment grade rating from at least two
nationally recognized statistical rating organizations, certain of these covenants will be terminated. The indenture
governing the 2028 Notes contains customary events of default (subject in certain cases to customary grace and cure 
periods). As of December 29, 2019, we were in compliance with all covenants under the indenture governing the 2028 
Notes.

On August 27, 2018, we issued $300.0 million aggregate principal senior unsecured notes (the “2026 Notes”).

The 2026 Notes were issued in a private placement for resale to qualified institutional buyers pursuant to Rule 144A 
under the Securities Act, and to buyers outside of the United States pursuant to Regulation S under the Securities Act. 
The 2026 Notes were issued without registration rights and are not listed on any securities exchange. The 2026 Notes 
bear interest at 5.75% per annum, payable in cash semiannually in arrears on March 15 and September 15 of each year 
and are due September 15, 2026. The 2026 Notes were issued at par. We received net proceeds of $295.7 million after 
deducting $4.3 million of debt issuance costs. The debt issuance costs were capitalized as a reduction to the carrying 
value of debt and are being accreted to interest expense over the term of the 2026 Notes using the effective interest 
method. The net proceeds from issuance of the 2026 Notes were used to redeem $125.0 million aggregate principal
amount of the 2023 Notes (as described in the footnotes to the consolidated financial statements), including the payment 
of related premiums, fees and expenses, with the balance of the proceeds available for general corporate purposes.

Obligations under the 2026 Notes are fully and unconditionally guaranteed, jointly and severally, on a senior 

unsecured basis, by certain of our directly or indirectly wholly-owned subsidiaries. We may redeem the 2026 Notes
under certain circumstances specified therein. The indenture governing the 2026 Notes contains restrictive covenants
that, among other things, limit our ability and the ability of our subsidiaries to: (i) incur additional debt and issue
disqualified or preferred stock, (ii) make restricted payments, (iii) sell assets, (iv) create or permit restrictions on the 
ability of our restricted subsidiaries to pay dividends or make other distributions to the parent company, (v) create or 
incur certain liens, (vi) enter into sale and leaseback transactions, (vii) merge or consolidate with other entities and (viii)
enter into transactions with affiliates. The foregoing limitations are subject to exceptions as set forth in the indenture
governing the 2026 Notes. In addition, if in the future the 2026 Notes have an investment grade rating from at least two
nationally recognized statistical rating organizations, certain of these covenants will be terminated. The indenture
governing the 2026 Notes contains customary events of default (subject in certain cases to customary grace and cure 
periods). As of December 29, 2019, we were in compliance with all covenants under the indenture governing the 2026 
Notes.

On September 27, 2017, and March 23, 2015, we issued $150.0 million and $475.0 million aggregate principal 
senior unsecured notes, respectively (the "2023 Notes"). The 2023 Notes were issued in two private placements for resale
to qualified institutional buyers pursuant to Rule 144A under the Securities Act, and to buyers outside the United States 
pursuant to Regulation S under the Securities Act. The 2023 Notes were issued without registration rights and are not 
listed on any securities exchange. The 2023 Notes bear interest at 5.625% per annum, payable in cash semiannually in 
arrears on March 15 and September 15 of each year and are due March 15, 2023. The 2023 Notes were issued at 104.0% 
and par in 2017 and 2015, respectively, and the resulting premium of $6.0 million is being amortized to interest expense
over the term of the 2023 Notes using the effective interest method. We received net proceeds of $153.9 million and 
$467.9 million, respectively, after deducting $2.1 million and $7.1 million of debt issuance costs in 2017 and 2015, 
respectively. The debt issuance costs were capitalized as a reduction to the carrying value of debt and are being accreted 
to interest expense over the term of the 2023 Notes using the effective interest method. The net proceeds from the 2017
issuance of the 2023 Notes were for general corporate purposes. The net proceeds from the 2015 issuance of the 2023
Notes, together with available cash balances, were used to redeem $500.0 million aggregate principal of prior 8.25%
senior unsecured notes due 2021 and to pay related premiums, fees and expenses. As of August 10, 2019, the 2023 Notes
were fully redeemed, as described above.

39

 
 
 
 
MASONITE INTERNATIONAL CORPORATION

ABL Facility

On January 31, 2019, we and certain of our subsidiaries entered into a $250.0 million asset-based revolving 

credit facility (the "ABL Facility") maturing on January 31, 2024. The borrowing base is calculated based on a
percentage of the value of selected United States, Canadian and United Kingdom accounts receivable and inventory, less 
certain ineligible amounts. Obligations under the ABL Facility are secured by a first priority security interest in such
accounts receivable, inventory and other related assets of Masonite and our subsidiaries. In addition, obligations under 
the ABL Facility are fully and unconditionally guaranteed, jointly and severally, on a senior secured basis, by certain of 
our directly or indirectly wholly-owned subsidiaries. Borrowings under the ABL Facility bear interest at a rate equal to,
at our option, (i) the United States, Canadian and United Kingdom Base Rate (each as defined in the credit agreement 
relating to the ABL Facility, the "Amended and Restated Credit Agreement") plus a margin ranging from 0.25% to
0.50% per annum, or (ii) the Adjusted LIBO Rate or BA Rate (each as defined in the Amended and Restated Credit 
Agreement), plus a margin ranging from 1.25% to 1.50% per annum. In addition to paying interest on any outstanding 
principal under the ABL Facility, a commitment fee is payable on the undrawn portion of the ABL Facility in an amount 
equal to 0.25% per annum of the average daily balance of unused commitments during each calendar quarter.

The ABL Facility contains various customary representations, warranties and covenants by us that, among other 

things, and subject to certain exceptions, restricts our ability and the ability of our subsidiaries to: (i) pay dividends on
our common shares and make other restricted payments, (ii) make investments and acquisitions, (iii) engage in
transactions with our affiliates, (iv) sell assets, (v) merge and (vi) create liens. The Amended and Restated Credit 
Agreement amended the ABL Facility to, among other things, (i) permit us to incur unlimited unsecured debt as long as
such debt does not contain covenants or default provisions that are more restrictive than those contained in the ABL 
Facility, (ii) permit us to incur debt as long as the pro forma secured leverage ratio is less than 4.5 to 1.0, and (iii) add 
certain additional exceptions and exemptions under the restricted payment, investment and indebtedness covenants 
(including increasing the amount of certain debt permitted to be incurred under existing exceptions). As of December 29, 
2019, we were in compliance with all covenants under the credit agreement governing the ABL Facility and there were
no amounts outstanding under the ABL Facility.

Supplemental Guarantor Financial Information

Our obligations under the 2028 Notes and 2026 Notes and the ABL Facility are fully and unconditionally
guaranteed, jointly and severally, by certain of our directly or indirectly wholly-owned subsidiaries. The following 
unaudited supplemental financial information for our non-guarantor subsidiaries is presented:

Our non-guarantor subsidiaries generated external net sales of $1.9 billion, $1.9 billion and $1.8 billion in the

years ended December 29, 2019, December 30, 2018 and December 31, 2017, respectively. Our non-guarantor 
subsidiaries generated Adjusted EBITDA of $241.6 million, $224.1 million and $209.2 million for the years ended 
December 29, 2019, December 30, 2018, and December 31, 2017, respectively. Our non-guarantor subsidiaries had total 
assets of $2.0 billion and $1.8 billion as of December 29, 2019, and December 30, 2018; and total liabilities of $834.5
million and $711.8 million as of December 29, 2019, and December 30, 2018, respectively.

40

MASONITE INTERNATIONAL CORPORATION

Contractual Obligations 

The following table presents our contractual obligations over the periods indicated as of December 29, 2019:

(In thousands)

Long-term debt
maturities

Scheduled interest
payments

Operating leases

Finance leases
Pension contributions (1)
Total (2)

2020

2021

2022

2023

2024

Thereafter

Total

Fiscal Year Ended

$

— $

— $

— $

— $

— $ 800,000

$ 800,000

44,125

27,197

1,393

785

44,125

20,058

1,326

1,086

44,125

17,276

1,365

1,141

44,125

14,212

1,287

1,197

44,125

13,515

1,445

1,258

128,563

87,088

52,981

3,794

349,188

179,346

59,797

9,261

$

73,500

$

66,595

$

63,907

$

60,821

$

60,343

$1,072,426

$1,397,592

____________
(1) Pension contributions relate to our United Kingdom pension plan.

(2) As of December 29, 2019, we have $5.8 million recorded as a long-term liability for uncertain tax positions. We are not able to reasonably estimate 
the timing of payments, or the amount by which our liability for these uncertain tax positions will increase or decrease over time, and accordingly, this
liability has been excluded from the above table.

Off-Balance Sheet Arrangements

We do not have any material off-balance sheet arrangements.

Critical Accounting Policies and Estimates

Our significant accounting policies are fully disclosed in our annual consolidated financial statements included 
elsewhere in this Annual Report. We consider the following policies to be most critical in understanding the judgments 
that are involved in preparing our consolidated financial statements.

Business Acquisition Accounting

We use the acquisition method of accounting for all business acquisitions. We allocate the purchase price of our 

business acquisitions based on the fair value of identifiable tangible and intangible assets. The difference between the 
total cost of the acquisitions and the sum of the fair values of the acquired tangible and intangible assets less liabilities is
recorded as goodwill.

Goodwill

We evaluate all business combinations for intangible assets that should be recognized and reported apart from

goodwill. Goodwill is not amortized but instead is tested annually for impairment on the last day of fiscal November, or 
more frequently if events or changes in circumstances indicate the carrying amount may not be recoverable. The test for 
impairment is performed at the reporting unit level by comparing the reporting unit’s carrying amount to its fair value. 
Possible impairment in goodwill is first analyzed using qualitative factors such as macroeconomic and market 
conditions, changing costs and actual and projected performance, amongst others, to determine whether it is more likely
than not that the book value of the reporting unit exceeds its fair value. If it is determined more likely than not that the
book value exceeds fair value, a quantitative analysis is performed to test for impairment. When quantitative steps are
determined necessary, the fair values of the reporting units are estimated through the use of discounted cash flow
analyses and market multiples. If the carrying amount exceeds fair value, then goodwill is impaired. Any impairment in
goodwill is measured as the excess of the carrying value of goodwill over the fair value. The inputs utilized to derive
projected cash flows are subject to significant judgments and uncertainties. As such, the realized cash flows could differ 
significantly from those estimated. We performed a quantitative impairment test during the fourth quarter of 2019 and 
determined that goodwill was not impaired. The resulting fair values of each reporting unit tested based upon such inputs
exceeded their respective carrying values by greater than 10%. Further, had the discount rate of each of our reporting 
units been hypothetically increased by 100 basis points, the fair values of each reporting unit would still have exceeded 
their respective carrying values. To the extent that future operating results of the reporting units do not meet the 

41

 
 
 
 
MASONITE INTERNATIONAL CORPORATION

forecasted cash flow projections, we can provide no assurance that a future goodwill impairment charge would not be
incurred.

Intangible Assets

Intangible assets with definite lives include customer relationships, non-compete agreements, patents, supply 

agreements, certain acquired trademarks and system software development. Definite-lived intangible assets are
amortized on a straight-line basis over their estimated useful lives. Amortizable intangible assets are tested for 
impairment whenever events or changes in circumstances indicate that the carrying value may be greater than the fair 
value. An impairment loss is recognized when the estimate of undiscounted future cash flows generated by such assets is 
less than the carrying amount. Measurement of the impairment loss is based on the fair value of the asset, determined 
using discounted cash flows when quoted market prices are not readily available. Indefinite-lived intangible assets are
tested for impairment annually on the last day of fiscal November, or more frequently if events or circumstances
indicated that the carrying value may exceed the fair value. We performed a qualitative impairment test during the fourth 
quarter of 2019 and determined that indefinite-lived intangible assets were not impaired.

Long-lived Assets

Long-lived assets other than goodwill and indefinite-lived intangible assets, which are separately tested for 

impairment, are evaluated for impairment whenever events or changes in circumstances indicate that the carrying value
may not be recoverable. When evaluating long-lived assets for potential impairment, we first compare the carrying value 
of the asset to the estimates of asset’s useful lives and undiscounted future cash flows based on market participant 
assumptions. If the undiscounted expected future cash flows are less than the carrying amount of the asset and the 
carrying amount of the asset exceeds its fair value, an impairment loss is recognized.

Income Taxes

As a multinational corporation, we are subject to taxation in many jurisdictions and the calculation of our tax

liabilities involves dealing with inherent uncertainties in the application of complex tax laws and regulations in various 
taxing jurisdictions. We assess the income tax positions and record tax liabilities for all years subject to examination 
based upon our evaluation of the facts, circumstances and information available as of the reporting date.

We account for income taxes using the asset and liability method. Under this method, deferred tax assets and 

liabilities are recognized for the future tax consequences of temporary differences between the carrying amounts and the 
tax basis of assets and liabilities at enacted rates. We base our estimate of deferred tax assets and liabilities on current tax
laws and rates and, in certain cases, business plans and other expectations about future outcomes. We record a valuation 
allowance to reduce our deferred tax assets to the amount that is more likely than not to be realized. While we have
considered future taxable income and ongoing prudent and feasible tax planning strategies in assessing the need for the
valuation allowance, in the event that we were to determine that we would be able to realize our deferred tax assets in the
future in excess of our net recorded amount, an adjustment to the deferred tax assets would be a credit to income in the
period such determination was made. The consolidated financial statements include changes to the valuation allowances 
as a result of uncertainty regarding our ability to realize certain deferred tax assets in the future.

Our accounting for deferred tax consequences represents our best estimate of future events that can be
appropriately reflected in the accounting estimates. Changes in existing tax laws, regulations, rates and future operating
results may affect the amount of deferred tax liabilities or the valuation of deferred tax assets over time. The application 
of tax laws and regulations is subject to legal and factual interpretation, judgment and uncertainty. Tax laws and 
regulations themselves are also subject to change as a result in changes in fiscal policy, changes in legislation, the
evolution of regulations and court rulings. 

Although we believe the measurement of liabilities for uncertain tax positions is reasonable, no assurance can 
be given that the final outcomes of these matters will not be different than what is reflected in the historical income tax
provisions and accruals. If we ultimately determine that the payment of these liabilities will be unnecessary, the liability
is reversed and a tax benefit is recognized in the period in which such determination is made. Conversely, additional tax
charges are recorded in a period in which it is determined that a recorded tax liability is less than the ultimate assessment 
is expected to be. If additional taxes are assessed as a result of an audit or litigation, there could be a material effect on
our income tax provision and net income in the period or periods for which that determination is made.

42

 
 
 
 
 
 
MASONITE INTERNATIONAL CORPORATION

Inventory

We value inventories at the lower of cost or replacement cost for raw materials, and the lower of cost or net 

realizable value for finished goods, with expense estimates made for obsolescence or unsaleable inventory. In 
determining net realizable value, we consider such factors as yield, turnover and aging, expected future demand and 
market conditions, as well as past experience. A change in the underlying assumptions related to these factors could 
affect the valuation of inventory and have a corresponding effect on cost of goods sold. Historically, actual results have
not significantly deviated from those determined using these estimates.

Share Based Compensation Plan

We have a share based compensation plan, which governs the issuance of common shares to employees as 

compensation through various grants of share instruments. We apply the fair value method of accounting using the
Black-Scholes-Merton option pricing model to determine the compensation expense for stock appreciation rights. The
compensation expense for the restricted stock units awarded is based on the fair value of the restricted stock units at the 
date of grant. Additionally, the compensation expense for certain performance based awards was determined using the
Monte Carlo simulation method. There were no awards outstanding as of December 29, 2019, valued using this method.
Compensation expense is recorded in the consolidated statements of comprehensive income and is recognized over the 
requisite service period. The determination of obligations and compensation expense requires the use of several
mathematical and judgmental factors, including stock price, expected volatility, the anticipated life of the award,
estimated risk free rate and the number of shares or share options expected to vest. Any difference in the number of 
shares or share options that actually vest can affect future compensation expense. Other assumptions are not revised after 
the original estimate.

Changes in Accounting Standards and Policies

Changes in accounting standards and policies are discussed in Note 1. Business Overview and Significant 

Accounting Policies in the Notes to the Consolidated Financial Statements in this Annual Report.

Item 7A. Quantitative and Qualitative Disclosures about Market Risk

We are exposed to market risk from changes in foreign currency exchange rates, interest rates and commodity

prices, which can affect our operating results and overall financial condition. We manage exposure to these risks
through our operating and financing activities and, when deemed appropriate, through the use of derivative financial 
instruments. Derivative financial instruments are viewed as risk management tools and are not used for speculation or 
for trading purposes. Derivative financial instruments are generally contracted with a diversified group of investment 
grade counterparties to reduce exposure to nonperformance on such instruments. 

We have in place an enterprise risk management process that involves systematic risk identification and 

mitigation covering the categories of enterprise, strategic, financial, operation and compliance and reporting risk. The 
enterprise risk management process receives Board of Directors and Management oversight, drives risk mitigation
decision-making and is fully integrated into our internal audit planning and execution cycle. 

Foreign Exchange Rate Risk 

We have foreign currency exposures related to buying, selling, and financing in currencies other than the local
currencies in which we operate. In the years ended December 29, 2019, December 30, 2018, and December 31, 2017, 
approximately 32%, 36% and 34% of our net sales were generated outside of the United States, respectively. In
addition, a significant percentage of our costs during the same period were not denominated in U.S. dollars. For 
example, for most of our manufacturing and distribution facilities, the prices for a significant portion of our raw 
materials are quoted in the domestic currency of the country where the facility is located or other currencies that are not 
U.S. dollars. We also have substantial assets outside the United States. As a result, the volatility in the price of the U.S.
dollar has exposed, and in the future may continue to expose, us to currency exchange risks. Also, since our financial 
statements are denominated in U.S. dollars, changes in currency exchange rates between the U.S. dollar and other 
currencies have had, and will continue to have, an impact on many aspects of our financial results. Changes in currency
exchange rates for any country in which we operate may require us to raise the prices of our products in that country or 
allow our competitors to sell their products at lower prices in that country. Unrealized exchange gains and losses arising
from the translation of the financial statements of our non-U.S. functional currency operations are accumulated in the 

43

cumulative translation adjustments account in accumulated other comprehensive loss. Net gains from currency
translation adjustments as a result of translating our foreign assets and liabilities into U.S. dollars during the year ended 
December 29, 2019, were $16.9 million, which were primarily driven by the weakening of the U.S. dollar against the
other major currencies in which we transact.

When deemed appropriate, we enter into various derivative financial instruments to preserve the carrying
amount of foreign currency-denominated assets, liabilities, commitments and certain anticipated foreign currency
transactions. We held no derivative financial instruments as of December 29, 2019, or December 30, 2018. If not 
mitigated by derivative financial instruments, price increases or other methods, a hypothetical 10% strengthening of the
U.S. Dollar against all foreign currencies in the jurisdictions in which we operate would result in an approximate $65
million translational decrease in our net sales and an approximate $1 million translational decrease in our net income.

Interest Rate Risk 

We are subject to market risk from exposure to changes in interest rates with respect to borrowings under our 
ABL Facility to the extent it is drawn on and due to our other financing, investing and cash management activities. As 
of December 29, 2019, and December 30, 2018, there were no outstanding borrowings under our ABL Facility.

Impact of Inflation, Deflation and Changing Prices 

We have experienced inflation and deflation related to our purchase of certain commodity products. We believe

that volatile prices for commodities have impacted our net sales and results of operations. We maintain strategies to 
mitigate the impact of higher raw material, energy and commodity costs, which include cost reduction, sourcing and 
other actions, which typically offset only a portion of the adverse impact. Inflation and deflation related to our 
purchases of certain commodity products could have an adverse impact on our operating results in the future. A 
hypothetical 10% inflationary increase in our material cost of goods sold would result in approximately $90 million of 
increased consolidated cost of goods sold.

44

Item 8. Financial Statements and Supplementary Data

 INDEX TO THE CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Report of Independent Registered Public Accounting Firm
Consolidated Statements of Comprehensive Income

Consolidated Balance Sheets

Consolidated Statements of Changes in Equity

Consolidated Statements of Cash Flows

Notes to the Consolidated Financial Statements

Supplemental Unaudited Quarterly Financial Information

46
48

49

50

51

52

94

45

Report of Independent Registered Public Accounting Firm

To the Shareholders and the Board of Directors of Masonite International Corporation

Opinion on the Financial Statements 

We have audited the accompanying consolidated balance sheets of Masonite International Corporation (the Company) as of 
December 29, 2019 and December 30, 2018, and the related consolidated statements of comprehensive income, changes in equity,
and cash flows for each of the three fiscal years in the period ended December 29, 2019, and the related notes (collectively 
referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all 
material respects, the financial position of the Company at December 29, 2019 and December 30, 2018, and the results of its
operations and its cash flows for each of the three fiscal years in the period ended December 29, 2019, in conformity with U.S.
generally accepted accounting principles. 

We also have 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 December 29, 2019, based on criteria established in 
Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 
framework) and our report dated February 20, 2020 expressed an unqualified opinion thereon.  

Adoption of ASU No. 2016 -02

As discussed in Notes 1 and 6 to the consolidated financial statements, the Company changed its method of accounting for leases
in fiscal 2019 due to the adoption of Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842), and the related 
amendments.

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.

t

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

t
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 the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as
a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit 
matter or on the account or disclosures to which it relates.

46

Valuation of Goodwill related to the Architectural Reporting Unit

Description of
the Matter

At December 29, 2019, the Company’s goodwill was $184.2 million, of which $111.0 million related to the 
Architectural reporting unit. As discussed in Notes 1 and 7 of the consolidated financial statements, the 
Company’s goodwill is assigned to its reporting units as of the acquisition date and is tested for impairment at 
least annually at the reporting unit level during the fourth quarter of the fiscal year or whenever changes in 
circumstances may indicate the carrying amounts may not be recoverable.

How We 
Addressed the
Matter in Our 
Audit

Auditing management’s annual goodwill impairment test for the Architectural reporting unit was complex and 
judgmental due to the significant estimation required to determine the fair value of the reporting unit. In 
particular, the fair value estimate was sensitive to significant assumptions such as net sales growth rates,
EBITDA margins, and the discount rate, which are affected by expectations about future market or economic 
conditions, including industry and company-specific factors. 

We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the
Company’s goodwill impairment review process, including management’s review of the significant 
assumptions described above and data underlying the estimate.

To test the estimated fair value of the Company’s Architectural reporting unit, we performed audit procedures 
that included, among others, assessing the valuation methodologies and testing the significant assumptions
discussed above and the underlying data used by the Company in its analysis. We involved our valuation
specialists to assist in our evaluation of the Company’s valuation methodology and significant assumptions. We
compared the significant assumptions used by management to current industry and economic trends, the 
Company’s historical results and other guideline companies within the same industry and evaluated whether 
changes in the Company’s business would affect the significant assumptions. We assessed the historical
accuracy of management’s estimates and performed sensitivity analyses of the significant assumptions to 
evaluate the changes in the fair value of the reporting unit that would result from changes in the assumptions.

/s/ Ernst & Young LLP

We have served as the Company’s auditor since 2016.

Tampa, Florida
February 20, 2020

47

 
 
MASONITE INTERNATIONAL CORPORATION
Consolidated Statements of Comprehensive Income
(In thousands of U.S. dollars, except per share amounts)

Net sales
Cost of goods sold
Gross profit

Selling, general and administration expenses

Restructuring costs

Asset impairment

Loss on disposal of subsidiaries
Operating income

Interest expense, net

Loss on extinguishment of debt
Other expense (income), net
Income before income tax expense (benefit)

Income tax expense (benefit)
Net income

Less: net income attributable to non-controlling interests
Net income attributable to Masonite

Basic earnings per common share attributable to Masonite

Diluted earnings per common share attributable to Masonite

Comprehensive income:

Net income

Other comprehensive income (loss):

Foreign currency translation gain (loss)

Pension and other post-retirement adjustment

Pension settlement charges

Amortization of actuarial net losses

Income tax (expense) benefit related to other comprehensive income (loss)

Other comprehensive income (loss), net of tax:

Comprehensive income

Less: comprehensive income attributable to non-controlling interests

December 29,
2019

Year Ended
December 30,
2018

December 31,
2017

$

2,176,683
1,699,000

$

2,170,103
1,734,797

$

2,032,925
1,625,942

477,683

310,567

9,776

13,767

14,260
129,313
46,489

14,523
1,953

66,348

17,309

49,039

4,437

435,306

266,193

1,624

5,243

—

162,246

39,008

5,414
(2,533)
120,357

23,813

96,544

3,834

406,983

247,917

850

—

212

158,004

30,153

—
(1,570)

129,421

(27,560)

156,981

5,242

$

$

$

$

44,602

$

92,710

$

151,739

1.77

1.75

$

$

3.38

3.33

$

$

5.18

5.09

49,039

$

96,544

$

156,981

16,912

962

5,651

1,798
(2,230)
23,093

72,132

4,780

(40,880)
(4,754)
—

1,291

742
(43,601)
52,943

3,000

38,970

529

—

1,113

(1,026)

39,586

196,567

5,994

Comprehensive income attributable to Masonite

$

67,352

$

49,943

$

190,573

See accompanying notes to the consolidated financial statements.

48

MASONITE INTERNATIONAL CORPORATION
Consolidated Balance Sheets
(In thousands of U.S. dollars, except share amounts)

ASSETS
Current assets:

Cash and cash equivalents

Restricted cash

Accounts receivable, net

Inventories, net

Prepaid expenses

Income taxes receivable
Total current assets

Property, plant and equipment, net

Operating lease right-of-use assets

Investment in equity investees

Goodwill

Intangible assets, net

Deferred income taxes

Other assets

Total assets

LIABILITIES AND EQUITY
Current liabilities:

Accounts payable

Accrued expenses

Income taxes payable

Total current liabilities

Long-term debt

Long-term operating lease liabilities

Deferred income taxes

Other liabilities

Total liabilities

Commitments and Contingencies (Note 10)
Equity:

Share capital: unlimited shares authorized, no par value, 24,869,921 and 25,835,664 shares
issued and outstanding as of December 29, 2019, and December 30, 2018, respectively

Additional paid-in capital

Accumulated deficit

Accumulated other comprehensive loss

Total equity attributable to Masonite

Equity attributable to non-controlling interests

Total equity

Total liabilities and equity

December 29,
2019

December 30,
2018

$

166,964

$

10,644

276,208

242,230

33,190

4,819

734,055

625,585

121,367

16,100

184,192

184,532

25,945

44,808

115,656

10,485

283,580

250,407

32,970

3,495

696,593

609,753

—

13,474

180,297

212,045

28,509

37,794

$

1,936,584

$

1,778,465

$

84,912

$

180,405

2,350

267,667

790,984

110,497

83,465

47,109

96,362

147,345

1,599

245,306

796,398

—

82,122

32,334

1,299,722

1,156,160

558,514

216,584
(20,047)
(130,169)
624,882

11,980

636,862

575,207

218,988

(30,836)

(152,919)

610,440

11,865

622,305

$

1,936,584

$

1,778,465

See accompanying notes to the consolidated financial statements.

49

MASONITE INTERNATIONAL CORPORATION
Consolidated Statements of Changes in Equity
(In thousands of U.S. dollars, except share amounts)

Total equity, beginning of period

Share capital:

Beginning of period

Common shares issued for delivery of share based awards
Common shares issued under employee stock purchase plan
Common shares repurchased and retired

End of period

Additional paid-in capital:

Beginning of period

Share based compensation expense
Common shares issued for delivery of share based awards
Common shares withheld to cover income taxes payable due to
delivery of share based awards
Common shares issued under employee stock purchase plan

End of period

Accumulated deficit:
Beginning of period

Net income attributable to Masonite
Common shares repurchased and retired

End of period

Accumulated other comprehensive loss:

Beginning of period

Other comprehensive income (loss) attributable to Masonite, net of tax

End of period

Equity attributable to non-controlling interests:

Beginning of period

Net income attributable to non-controlling interests
Other comprehensive income (loss) attributable to non-controlling
interests, net tax
Dividends to non-controlling interests

End of period

Total equity, end of period

Common shares outstanding:

Beginning of period

Common shares issued for delivery of share based awards
Common shares issued under employee stock purchase plan
Common shares repurchased and retired

End of period

December 29, 2019 December 30, 2018 December 31, 2017
659,776
$

735,902

622,305

$

$

575,207
8,396
1,045
(26,134)
558,514

218,988
10,023
(8,396)

(3,852)
(179)
216,584

(30,836)
44,602
(33,813)
(20,047)

(152,919)
22,750
(130,169)

11,865
4,437

624,403
11,375
949
(61,520)
575,207

226,528
7,681
(11,375)

(3,743)
(103)
218,988

(18,150)
92,710
(105,396)
(30,836)

(110,152)
(42,767)
(152,919)

13,273
3,834

343
(4,665)
11,980
636,862

$

(834)
(4,408)
11,865
622,305

$

$

650,007
12,290
1,168
(39,062)
624,403

234,926
11,644
(12,290)

(7,466)
(286)
226,528

(89,063)
151,739
(80,826)
(18,150)

(148,986)
38,834
(110,152)

12,892
5,242

752
(5,613)
13,273
735,902

25,835,664
186,242
18,940
(1,170,925)
24,869,921

28,369,877
223,487
13,984
(2,771,684)
25,835,664

29,774,784
372,826
16,368
(1,794,101)
28,369,877

See accompanying notes to the consolidated financial statements.

50

MASONITE INTERNATIONAL CORPORATION
Consolidated Statements of Cash Flows
(In thousands of U.S. dollars)

Cash flows from operating activities:
Net income
Adjustments to reconcile net income to net cash flow provided by operating activities:

Year Ended

December 29,
2019

December 30,
2018

December 31,
2017

$

49,039

$

96,544

$

156,981

Loss on disposal of subsidiaries
Loss on extinguishment of debt
Depreciation
Amortization
Share based compensation expense
Deferred income taxes
Unrealized foreign exchange loss
Share of income from equity investees, net of tax
Pension and post-retirement funding, net of expense
Non-cash accruals and interest
Loss on sale of property, plant and equipment
Asset impairment
Changes in assets and liabilities, net of acquisitions:

Accounts receivable
Inventories
Prepaid expenses
Accounts payable and accrued expenses
Other assets and liabilities

Net cash flow provided by operating activities
Cash flows from investing activities:

Additions to property, plant and equipment
Acquisition of businesses, net of cash acquired
Issuance of note receivable
Proceeds from sale of subsidiaries, net of cash disposed
Proceeds from sale of property, plant and equipment
Other investing activities

Net cash flow used in investing activities
Cash flows from financing activities:

Proceeds from issuance of long-term debt
Repayments of long-term debt
Payment of debt extinguishment costs
Payment of debt issuance costs
Tax withholding on share based awards
Distributions to non-controlling interests
Repurchases of common shares

Net cash flow (used in) provided by financing activities
Net foreign currency translation adjustment on cash
Increase (decrease) in cash, cash equivalents and restricted cash
Cash, cash equivalents and restricted cash, beginning of period
Cash, cash equivalents and restricted cash, at end of period

$

14,260
14,523
70,736
29,113
10,023
3,292
320

(2,626)
(827)
57
6,396
13,767

6,723
5,735
(332)
4,742
(3,285)
221,656

(82,720)
(2,029)
—
1,001
3,640
(2,018)
(82,126)

500,000
(500,177)
(14,065)
(6,701)
(3,852)
(4,665)
(59,947)
(89,407)
1,344

51,467
126,141
177,608

$

—
5,414

59,089
28,583
7,681

10,563
700
(2,164)
(7,112)
857
3,470
5,243

(4,543)
(1,192)
(5,316)
11,909
(6,494)
203,232

(82,380)
(157,363)
(12,000)
—
1,353
(4,087)
(254,477)

300,000
(125,363)
(5,274)
(4,344)
(3,743)
(4,408)
(166,916)
(10,048)
(1,130)
(62,423)
188,564
126,141

$

212
—
57,528
24,375
11,644
(34,230)
1,496
(2,008)
(6,806)
1,226
1,893
—

(15,926)
692
(2,026)
(15,809)
(5,761)
173,481

(73,782)
(13,813)
—
—
1,114
(3,653)
(90,134)

156,746
(422)
—
(2,141)
(7,466)
(5,613)
(119,888)
21,216
91
104,654
83,910
188,564

See accompanying notes to the consolidated financial statements.

51

MASONITE INTERNATIONAL CORPORATION
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1. Business Overview and Significant Accounting Policies

Unless we state otherwise or the context otherwise requires, references to “Masonite,” “we,” “our,” “us” and the 

“Company” in these notes to the consolidated financial statements refer to Masonite International Corporation and its 
subsidiaries.

Description of Business

Masonite International Corporation is one of the largest manufacturers of doors in the world, with significant 

market share in both interior and exterior door products. Masonite operates 63 manufacturing locations in eight countries 
and sells doors to customers throughout the world, including the United States, Canada and the United Kingdom.

Basis of Presentation

We prepare these consolidated financial statements in accordance with accounting principles generally accepted 

in the United States of America (“GAAP”). These consolidated financial statements include the accounts of Masonite 
International Corporation, a company incorporated under the laws of British Columbia, and its subsidiaries, as of 
December 29, 2019, and December 30, 2018, and for the years ended December 29, 2019, December 30, 2018, and 
December 31, 2017.

Our fiscal year is the 52- or 53-week period ending on the Sunday closest to December 31. In a 52-week year,

each fiscal quarter consists of 13 weeks. For ease of disclosure, the 13-week periods are referred to as three-month
periods and the 52- or 53-week periods are referred to as years. 

Changes in Accounting Standards and Policies

Adoption of Recent Accounting Pronouncements

In August 2018, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Updates

("ASU") 2018-15, “Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That 
Is a Service Contract.” This ASU amended the definition of a hosting arrangement and required a customer in a cloud 
computing arrangement that is a service contract to follow the internal-use software guidance in ASC 350-40
“Intangibles-Goodwill and Other-Internal-Use Software” to determine which implementation costs to capitalize as assets
or expense as incurred. Capitalized implementation costs related to a hosting arrangement that is a service contract will
be amortized over the term of the hosting arrangement, beginning when the module or component of the hosting
arrangement is ready for its intended use. The guidance is effective for annual periods beginning after December 15, 
2019, and interim periods within those annual periods; early adoption is permitted and either retrospective or prospective
application is required for all implementation costs incurred after the date of adoption. We have early adopted this
guidance prospectively as of December 31, 2018, the beginning of fiscal year 2019, and the adoption did not have a
material impact on our financial statements. 

In January 2017, the FASB issued ASU 2017-04, "Simplifying the Test for Goodwill Impairment," which 

amends ASC 350 "Intangibles - Goodwill and Other." This ASU simplified the accounting for goodwill impairments and 
allowed a goodwill impairment charge to be based upon the amount of a reporting unit's carrying value in excess of its
fair value; thus, eliminating what is currently known as "Step 2" under the current guidance. This ASU was effective for 
annual periods beginning after December 15, 2019, and interim periods within those annual periods; early adoption was
permitted and prospective application was required. We have adopted this guidance prospectively as of December 31,
2018, the beginning of fiscal year 2019, and the adoption did not have a material impact on our financial statements.

In February 2016, the FASB issued ASU 2016-02, "Leases (Topic 842)," which replaced the existing guidance 
in ASC 840, "Leases." This standard was supplemented by ASUs 2018-01, 2018-10, 2018-11 and 2019-01. The updated 
standards aimed to increase transparency and comparability among organizations by requiring lessees to recognize right-
of-use ("ROU") assets and lease liabilities on the balance sheet and requiring disclosure of key information about leasing 
arrangements. The transition option in ASU 2018-11 allowed entities to not apply the standards to the comparative
periods they present in their financial statements in the year of adoption. These ASUs were effective for annual periods
beginning after December 15, 2018, and interim periods within those annual periods; early adoption was permitted. We

52

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

have elected to adopt these standards utilizing the modified retrospective method as of December 31, 2018, with the
package of practical expedients permitted under the transition guidance of the new standards, which allowed us to not 
reassess whether any expired or existing contracts contain leases, to carry forward the historical lease classification and 
permitted us to exclude from our assessment initial direct costs for any existing leases. Additionally, we elected to utilize 
the practical expedient which allowed us to account for each separate lease component and the non-lease components
associated with that lease component as a single lease component. We also made an accounting policy election to
exclude leases with an initial term of twelve months or less from our transition adjustment. Lease payments are
recognized in the consolidated statements of comprehensive income on a straight-line basis over the lease term. 

The adoption of the standard resulted in the recognition of a ROU asset and lease liability for our operating
leases of $108.0 million and $113.9 million, respectively, as of December 31, 2018. At the time of the adoption our 
operating leases included leases for real estate and machinery and equipment and we did not have any material finance
leases. The difference between the opening ROU asset and lease liability amounts was due to the reclassification of the 
existing deferred rent liability balance against the opening ROU assets to which it related. The standard did not 
materially affect our results of operations, liquidity or compliance with our debt covenants under our current agreements. 
Additional transition disclosures, including our updated lease accounting policy, are included in Note 6.  

In May 2014, the FASB issued ASU 2014-09, "Revenue from Contracts with Customers," which created ASC

606, "Revenue from Contracts with Customers," and largely superseded the existing guidance of ASC 605, "Revenue
Recognition." This standard outlined a single comprehensive model for entities to use in accounting for revenue arising
from contracts with customers and superseded most current revenue recognition guidance, including industry-specific
guidance. The core principle of the revenue model is that an entity recognizes revenue to depict the transfer of promised 
goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in 
exchange for those goods or services. In August 2015, the FASB issued ASU 2015-14, "Revenue from Contracts with
Customers - Deferral of the Effective Date," and the guidance would now be effective for annual and interim periods 
beginning on or after December 15, 2017. We adopted the guidance of ASC 606 as of January 1, 2018, using the 
modified retrospective method and applied the standard to only those contracts which were not completed as of the
transition date. The adoption of this standard did not have a material impact on revenues in the years ended December 
29, 2019, or December 30, 2018. Prior period amounts were not adjusted and have continued to be reported in 
accordance with our historic accounting under Topic 605. While we considered an adjustment to opening retained 
earnings as prescribed by the modified retrospective method, there was no material adjustment ultimately required.
Furthermore, there was no material difference between the prior period amounts as reported under ASC 605 and such 
amounts as would have been reported under ASC 606. Information about the nature, amount and timing of our revenues 
from contracts with customers is disclosed in Note 11. Revenues. Our accounting policy for revenue recognition is set 
forth under Summary of Significant Accounting Policies below.

Other Recent Accounting Pronouncements not yet Adopted 

In December 2019, the FASB issued ASU 2019-12, "Simplifying the Accounting for Income Taxes," as part of 

its Simplification Initiative to reduce the cost and complexity in accounting for income taxes. This standard removes
certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in 
an interim period and the recognition of deferred tax liabilities for outside basis differences. It also amends other aspects
of the guidance to help simplify and promote consistent application of GAAP. The guidance is effective for interim and 
annual periods beginning after December 15, 2020, with early adoption permitted. We are in the process of evaluating
this guidance to determine the impact it may have on our financial statements.

In August 2018, the FASB issued ASU 2018-14, "Disclosure Framework—Changes to the Disclosure

Requirements for Defined Benefit Plans," which amended ASC 715, "Compensation—Retirement Benefits." This 
standard is applicable for employers that sponsor defined benefit pension or other postretirement plans, and eliminates
disclosures no longer considered cost beneficial, clarifies specific disclosure requirements for entities that provide
aggregate disclosures for two or more plans and adds requirements for explanations for significant gains and losses 
related to changes in benefit obligations. The guidance will be effective for annual periods ending after December 15, 
2020; early adoption is permitted and retrospective application is required. We are in the process of evaluating this
guidance to determine the impact it may have on our financial statements.

53

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

In June 2016, the FASB issued ASU 2016-13, “Financial Instruments—Credit Losses (Topic 326),” which

replaces the incurred loss methodology for recognizing credit losses with a current expected credit losses model. This
standard applies to all financial assets, including trade receivables. Our current accounts receivable policy is described in 
detail in Note 1 and uses historical and current information to estimate the amount of probable credit losses in our 
existing account receivable balances. The guidance is effective for annual periods beginning after December 15, 2019,
including interim periods within those fiscal years; early adoption is permitted and modified retrospective application is
required. We do not expect the adoption of this standard will have a material impact on our financial statements.

Summary of Significant Accounting Policies

(a) Principles of consolidation:

These consolidated financial statements include the accounts of Masonite and our subsidiaries and the accounts 

of any variable interest entities for which we are the primary beneficiary. Intercompany accounts and transactions have 
been eliminated upon consolidation. The results of subsidiaries acquired during the periods presented are consolidated 
from their respective dates of acquisition using the acquisition method. Subsidiaries are prospectively deconsolidated as 
of the date when we no longer have effective control of the entity.

(b) Translation of consolidated financial statements into U.S. dollars:

These consolidated financial statements are expressed in U.S. dollars. The accounts of the majority of our self-
sustaining foreign operations are maintained in functional currencies other than the U.S. dollar. Assets and liabilities for 
these subsidiaries have been translated into U.S. dollars at the exchange rates prevailing at the end of the period and 
results of operations at the average exchange rates for the period. Unrealized exchange gains and losses arising from the
translation of the financial statements of our non-U.S. functional currency operations are accumulated in the cumulative 
translation adjustments account in accumulated other comprehensive loss. For our foreign subsidiaries where the U.S.
dollar is the functional currency, all foreign currency-denominated accounts are remeasured into U.S. dollars. Unrealized 
exchange gains and losses arising from remeasurements of foreign currency-denominated assets and liabilities are
included within other income, net of expense, in the consolidated statements of comprehensive income. Gains and losses 
arising from international intercompany transactions that are of a long-term investment nature are reported in the same 
manner as translation gains and losses. Realized exchange gains and losses are included in net income for the periods 
presented.

(c) Cash and cash equivalents:

Cash includes cash equivalents which are short-term highly liquid investments with original maturities of three 

months or less.

(d) Restricted cash:

Restricted cash includes cash we have placed as collateral for standby letters of credit. The letters of credit 

guarantee payment to third parties in the event the company is in breach of contract terms as detailed in each letter of 
credit. As of December 29, 2019, and December 30, 2018, we had standby letters of credit totaling $2.6 million and $2.9 
million, respectively. There were no amounts drawn upon these letters of credit as of December 29, 2019, 
or December 30, 2018.

(e) Accounts receivable:

We record accounts receivable as our products are received by our customers. Our customers are primarily

retailers, distributors and contractors. We maintain an allowance for doubtful accounts for estimated losses resulting from
the inability of our customers to pay. We consider the overall quality and aging of receivables and specifically identified 
customer risks. The expense is included within selling, general and administration expense in the consolidated statements 
of comprehensive income. Generally, we do not require collateral for our accounts receivable.

54

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(f) Inventories:

Raw materials and finished goods are valued at the lower of cost or net realizable value. Cost is determined on a

first in, first out basis. In determining the net realizable value, we consider factors such as yield, turnover, expected 
future demand and past experience.

The cost of inventories includes all costs of purchase, costs of conversion and other costs incurred in bringing 

the inventories to their present location and condition. The costs of conversion of inventories include costs directly
related to the units of production, such as direct labor. They also include a systematic allocation of fixed and variable
production overheads that are incurred in converting raw materials into finished goods. Fixed production overheads are 
those indirect costs of production that remain relatively constant regardless of the volume of production, such as
depreciation and maintenance of factory buildings and equipment, and the cost of factory management and 
administration. Variable production overheads are those indirect costs of production that vary directly, or nearly directly, 
with the volume of production, such as indirect materials and indirect labor.

To determine the cost of inventory, we allocate fixed expenses to the cost of production based on the normal
capacity, which refers to a range of production levels and is considered the production expected to be achieved over a
number of periods or seasons under normal circumstances, taking into account the loss of capacity resulting from
planned maintenance. Fixed overhead costs allocated to each unit of production are not increased due to abnormally low
production. Those excess costs are recognized as a current period expense. When a production facility is completely shut 
down temporarily, it is considered idle, and all related expenses are charged to cost of goods sold.

(g) Property, plant and equipment

Property, plant and equipment are stated at cost. Depreciation is recorded based on the carrying values of 

buildings, machinery and equipment using the straight-line method over the estimated useful lives set forth as follows:

Buildings

Machinery and equipment

Tooling

Machinery and equipment

Molds and dies

Office equipment, fixtures and fittings

Information technology systems

Useful Life (Years)

20 - 40

10 - 25

5 - 25

12 - 25

3 - 12

5 - 15

Improvements and major maintenance that extend the life of an asset are capitalized; other repairs and 
maintenance are expensed as incurred. When assets are retired or otherwise disposed, their carrying values and 
accumulated depreciation are removed from the accounts.

Property, plant and equipment are tested for impairment when events or changes in circumstances indicate that 
the carrying value of an asset or asset group may not be recoverable. An impairment loss is recognized when the carrying
amount of an asset or asset group being tested for recoverability exceeds the sum of the undiscounted cash flows 
expected from its use and disposal. Impairments are measured as the amount by which the carrying amount of the asset 
or asset group exceeds its fair value, as determined using a discounted cash flows approach when quoted market prices 
are not available.

(h) Goodwill:

We use the acquisition method of accounting for all business combinations, and we evaluate all business 
combinations for intangible assets that should be recognized apart from goodwill. Goodwill adjustments are recorded for 
the effect on goodwill of changes to net assets acquired during the measurement period (up to one year from the date of 
acquisition) for new information obtained about facts and circumstances that existed as of the acquisition date that, if 
known, would have affected the measurement of the amounts recognized as of that date.

55

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Goodwill is not amortized, but instead is tested annually for impairment on the last day of fiscal November, or 
more frequently if events or changes in circumstances indicate the carrying amount may not be recoverable. The test for 
impairment is performed at the reporting unit level by comparing the reporting unit’s carrying amount to its fair value. 
Possible impairment in goodwill is first analyzed using qualitative factors such as macroeconomic and market 
conditions, changing costs and actual and projected performance, amongst others, to determine whether it is more likely
than not that the book value of the reporting unit exceeds its fair value. If it is determined more likely than not that the
book value exceeds fair value, a quantitative analysis is performed to test for impairment. When quantitative steps are
determined necessary, the fair values of the reporting units are estimated through the use of discounted cash flow
analysis and market multiples. If the carrying amount exceeds fair value, then goodwill is impaired. Any impairment in
goodwill is measured as the excess of the carrying value of goodwill over the fair value. There were no impairment 
charges recorded against goodwill in any period presented.

When developing our discounted cash flow analyses, a number of assumptions and estimates are involved to 
forecast operating cash flows, including future net sales growth, EBITDA margin growth, benefits from restructuring
initiatives, income tax rates, capital spending, business initiatives and working capital changes. These assumptions may
vary significantly among the reporting units. Operating cash flow forecasts are based on operating plans for the early
years and historical relationships and long-term economic outlooks for our industry in later years. The discount rate is
estimated for each specific reporting unit. Due to the many variables inherent in the estimation of a reporting unit’s fair 
value and the relative size of our recorded goodwill, differences in assumptions may have a material effect on the results
of our impairment analyses. 

The performance of our 2019 annual impairment test based on the inputs outlined above did not result in any

impairment of our goodwill. The resulting fair values of each reporting unit tested based upon such inputs exceeded their 
respective carrying values by greater than 10%. 

There were no impairment charges recorded against goodwill in 2018 or 2017 and we have not materially 

changed our methodology for goodwill impairment testing for the years presented.

(i) Intangible assets:

Intangible assets with definite lives include customer relationships, non-compete agreements, patents, system 
software development, supply agreements and acquired trademarks and tradenames. Definite lived intangible assets are
amortized over their estimated useful lives. Information pertaining to the estimated useful lives of intangible assets is as 
follows:

Customer relationships

Non-compete agreements
Patents

System software development

Supply agreements

Acquired trademarks and tradenames

Estimated Useful Life

Over expected relationship period, not exceeding 10 years

Straight-line over life of the agreement
Over expected useful life, not exceeding 17 years

Over expected useful life

Straight-line over life of the agreement

Straight-line over expected useful life

Amortizable intangible assets are tested for impairment whenever events or changes in circumstances indicate 

that the carrying value may be greater than fair value. An impairment loss is recognized when the estimate of 
undiscounted future cash flows generated by such assets is less than the carrying amount. Measurement of the
impairment loss is based on the fair value of the asset. Fair value is measured using discounted cash flows.

Indefinite lived intangible assets are not amortized, but instead are tested for impairment annually on the last 
day of fiscal November, or more frequently if events or circumstances indicate the carrying value may exceed the fair 
value.

56

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(j) Income taxes:

We use the asset and liability method of accounting for income taxes. Under the asset and liability method, 

deferred tax assets and liabilities are recognized for the deferred tax consequences attributable to differences between the 
financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets 
and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those 
temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities due to a 
change in tax rates is recognized in income in the period that includes the date of enactment. A valuation allowance is 
recorded to reduce deferred tax assets to an amount that is anticipated to be realized on a more likely than not basis.

We account for uncertain taxes in accordance with ASC 740, “Income Taxes.” The initial benefit recognition
model follows a two-step approach. First we evaluate if the tax position is more likely than not of being sustained if 
audited based solely on the technical merits of the position. Second, we measure the appropriate amount of benefit to
recognize. This is calculated as the largest amount of tax benefit that has a greater than 50% likelihood of ultimately
being realized upon settlement. Subsequently at each reporting date, the largest amount that has a greater than 50%
likelihood of ultimately being realized, based on information available at that date, will be measured and recognized.

We recognize interest and penalties related to unrecognized tax benefits within the income tax expense line in

the consolidated statements of comprehensive income. Accrued interest and penalties are included within the related tax
liability line in the consolidated balance sheets.

(k) Employee future benefits:

We maintain defined benefit pension plans. Benefits under the plans were frozen or curtailed at various times in

the past. Earnings are charged with the cost of benefits earned by employees as services are rendered. The cost reflects
management’s best estimates of the pension plans’ expected investment yields, wage and salary escalation, mortality of 
members, terminations and the ages at which members will retire. Changes in these assumptions could impact future 
pension expense. Service cost components are recognized within cost of goods sold and non-service cost components are
recognized within other expense (income), net in the consolidated statements of comprehensive income. The excess of 
the net actuarial gain (loss) over 10% of the greater of the benefit obligation or fair value of plan assets at the beginning 
of the year is amortized over the average remaining service lives of the members.

Assets are valued at fair value for the purpose of calculating the expected return on plan assets. Past service

costs arising from plan amendments are amortized on a straight-line basis over the average remaining service period of 
employees active at the date of amendment.

When a restructuring of a benefit plan gives rise to both a curtailment and a settlement of obligations, the

curtailment is accounted for prior to the settlement. Curtailment gains are offset against unrecognized losses and any
excess gains and all curtailment losses are recorded in the period in which the curtailment occurs.

(l) Restructuring costs:

Restructuring costs include all salary-related severance benefits that are accrued and expensed when a
restructuring plan has been put into place, the plan has received approval from the appropriate level of management and 
the benefit is probable and reasonably estimable. In addition to salary-related costs, we incur other restructuring costs
when facilities are closed or capacity is realigned within the organization. Upon termination of a contract we record 
liabilities and expenses pursuant to the terms of the relevant agreement. For non-contractual restructuring activities,
liabilities and expenses are measured and recorded at fair value in the period in which they are incurred.

Restructuring-related costs are presented separately in the consolidated statements of comprehensive income 

whereas non-restructuring severance benefits are charged to cost of goods sold or selling, general and administration
expense depending on the nature of the job responsibilities.

57

 
 
 
 
 
 
 
 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(m) Financial instruments:

We have applied a framework consistent with ASC 820, “Fair Value Measurement and Disclosure,” and have 

disclosed all financial assets and liabilities measured at fair value and non-financial assets and liabilities measured at fair
value on a non-recurring basis (at least annually).

We classify and disclose assets and liabilities carried at fair value in one of the following three categories:

Level 1: Quoted market prices in active markets for identical assets or liabilities.

Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data.

Level 3: Unobservable inputs that are not corroborated by market data.

The estimated fair value of a financial instrument is the amount at which the instrument could be exchanged in a

current transaction between willing parties, other than a forced or liquidation sale. These estimates, although based on
the relevant market information about the financial instrument, are subjective in nature and involve uncertainties and 
matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could 
significantly affect the estimates.

(n) Share based compensation expense:

We have a share based compensation plan, which is described in detail in Note 12. We apply the fair value 

method of accounting using comprehensive valuation models, including the Black-Scholes-Merton option pricing model, 
to determine the compensation expense.

(o) Revenue recognition:

Revenue from the sale of products is recognized when control of the promised goods is transferred to our 

customers based on the agreed-upon shipping terms, in an amount that reflects the consideration to which we expect to
be entitled in exchange for those goods or services. Volume rebates, expected returns, discounts and other incentives to 
customers are considered variable consideration and we estimate these amounts based on the expected amount to be 
provided to customers and reduce the revenues we recognize accordingly. Sales taxes and value added taxes assessed by 
governmental entities are excluded from the measurement of consideration expected to be received. Shipping and 
handling costs incurred after a customer has taken possession of our goods are treated as a fulfillment cost and are not 
considered a separate performance obligation. Shipping and other transportation costs charged to customers are recorded 
in both revenues and cost of goods sold in the consolidated statements of comprehensive income. 

(p) Product warranties:

We warrant certain qualitative attributes of our door products. We have recorded provisions for estimated 

warranty and related costs within accrued expenses on the consolidated balance sheets, based on historical experience 
and we periodically adjust these provisions to reflect actual experience. The rollforward of our warranty provision is as 
follows for the periods indicated:

(In thousands)

Balance at beginning of period

Additions charged to expense

Deductions

Balance at end of period

Year Ended

December 29, 2019 December 30, 2018 December 31, 2017

$

$

4,270

$

7,142
(6,998)
4,414

$

2,189

$

6,965
(4,884)
4,270

$

2,717

5,715
(6,243)
2,189

58

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(q) Vendor rebates:

We account for cash consideration received from a vendor as a reduction of cost of goods sold and inventory, in

the consolidated statements of comprehensive income and consolidated balance sheets, respectively. The cash 
consideration received represents agreed-upon vendor rebates that are earned in the normal course of operations.

(r) Advertising costs:

We recognize advertising costs as they are incurred. Advertising costs incurred primarily relate to tradeshows
and are included within selling, general and administration expense in the consolidated statements of comprehensive 
income. Advertising costs were $14.2 million, $12.6 million and $12.9 million in the years ended December 29, 2019, 
December 30, 2018, and December 31, 2017, respectively. 

(s) Research and development costs:

We recognize research and development costs as they are incurred. Research and development costs incurred 

primarily relate to the development of new products and the improvement of manufacturing processes, and are primarily 
included within cost of goods sold in the consolidated statements of comprehensive income. These costs exclude the 
significant investments in other areas such as advanced automation and e-commerce. Research and development costs 
were $7.2 million, $7.3 million and $7.5 million in the years ended December 29, 2019, December 30, 2018, and 
December 31, 2017, respectively. 

(t) Insurance losses and proceeds:

All involuntary conversions of property, plant and equipment are recorded as losses within loss (gain) on

disposal of property, plant and equipment, which is included within selling, general and administration expense in the 
consolidated statements of comprehensive income and as reductions to property, plant and equipment in the consolidated 
balance sheets. Any subsequent proceeds received for insured losses of property, plant and equipment are also recorded 
as gains within loss (gain) in disposal of property, plant and equipment, and are classified as cash flows from investing
activities in the consolidated statements of cash flows in the period in which the cash is received. Proceeds received for 
business interruption recoveries are recorded as a reduction to selling, general and administration expense in the
consolidated statements of comprehensive income and are classified as cash flows from operating activities in the 
consolidated statements of cash flows in the period in which an acknowledgment from the insurance carrier of settlement 
or partial settlement of a non-refundable nature has been presented to us.

(u) Equity investments:

We account for investments in affiliates of between 20% and 50% ownership, over which we have significant 
influence, using the equity method. We record our share of earnings of the affiliate within other income, net of expense, 
in the consolidated statements of comprehensive income and dividends as a reduction of the investment in the affiliate in 
the consolidated balance sheets when declared.

(v) Segment Reporting:

Our reportable segments are organized and managed principally by end market: North American Residential,

Europe and Architectural. The North American Residential reportable segment is the aggregation of the Wholesale and 
Retail operating segments. The Europe reportable segment is the aggregation of the United Kingdom and Central Eastern
Europe operating segments. The Architectural reportable segment consists solely of the Architectural operating segment.
The Corporate & Other category includes unallocated corporate costs and the results of immaterial operating segments
which were not aggregated into any reportable segment. Operating segments are aggregated into reportable segments
only if they exhibit similar economic characteristics. In addition to similar economic characteristics we also consider the
following factors in determining the reportable segments: the nature of business activities, the management structure
directly accountable to our chief operating decision maker for operating and administrative activities, availability of 
discrete financial information and information presented to the Board of Directors and investors.

59

 
 
 
 
 
 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(w) Use of estimates:

The preparation of consolidated financial statements in conformity with GAAP requires management to make
estimates and assumptions which affect the reported amounts of assets and liabilities and disclosure of contingent assets
and liabilities as of the date of the consolidated financial statements and the reported amounts of net sales and expenses 
during the reporting periods. During 2019, there were no material changes in the methods or policies used to establish
estimates and assumptions. Actual results may differ from our estimates.

2. Acquisitions and Dispositions

2019 Acquisition

On August 29, 2019, we completed the acquisition of TOPDOORS, s.r.o. ("Top Doors") based in the Czech
Republic for cash consideration of $1.6 million, net of cash acquired. Top Doors is a specialist manufacturer of door 
frames. The excess purchase price over the fair value of net assets acquired of $1.1 million was allocated to goodwill in
our Europe segment. During the fourth quarter of 2019, as a result of working capital adjustments we paid an additional 
$0.2 million, which resulted in a $0.2 million increase in goodwill. The goodwill principally represents anticipated 
synergies from Top Doors' integration into our existing Europe door business. The purchase price allocation, net sales,
net income (loss) attributable to Masonite and pro forma information for Top Doors are not presented as they were not 
material for any period presented.

2018 Acquisitions

On November 1, 2018, we completed the acquisition of the operating assets of Bridgewater Wholesalers Inc.

(“BWI”) for cash consideration of $22.3 million, net of cash acquired. BWI is headquartered in Branchburg, New Jersey, 
and is a fabricator and distributor of residential interior and exterior door systems, supporting customers in the Mid-
Atlantic and Northeastern United States. Their product offerings include residential interior and exterior doors, 
commercial doors and hardware as well as value-added pre-finishing services. The excess purchase price over the fair 
value of net assets acquired of $3.7 million was allocated to goodwill. The goodwill principally represents anticipated 
synergies to be gained from the integration into our existing North American Residential business and the goodwill is 
deductible for tax purposes.

On June 1, 2018, we completed the acquisition of the operating assets of the wood door companies of AADG,

Inc., including the brands Graham Manufacturing Corporation and The Maiman Company (collectively, "Graham &
Maiman"). We acquired the operating assets of Graham & Maiman for cash consideration of $39.0 million. Graham &
Maiman are based in Mason City, Iowa, and Springfield, Missouri. Graham & Maiman provide the non-residential 
construction industry with a full range of architectural premium and custom grade flush wood doors, architectural stile 
and rail wood doors, thermal-fused flush wood doors and wood door frames. The excess purchase price over the fair 
value of net assets acquired of $11.0 million was allocated to goodwill. The goodwill principally represents anticipated 
synergies to be gained from the integration into our existing Architectural business and the goodwill is deductible for tax
purposes.

On January 29, 2018, we completed the acquisition of DW3 Products Holdings Limited (“DW3”), a leading UK 

provider of high quality premium door solutions and window systems, supplying products under brand names such as
Solidor, Residor, Nicedor and Residence. We acquired 100% of the equity interests in DW3 for cash consideration
of $96.3 million, net of cash acquired. DW3 is based in Stoke-on-Trent and Gloucester, England, and their online quick 
ship capabilities and product portfolio both complement and expand the strategies we are pursuing with our business.
The excess purchase price over the fair value of net assets acquired of $33.6 million was allocated to goodwill. The
goodwill principally represents anticipated synergies to be gained from the integration into our existing United Kingdom
business. This goodwill is not deductible for tax purposes and relates to the Europe segment.

60

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

The fair value of assets acquired and liabilities assumed in the 2018 Acquisitions are as follows:

(In thousands)

Accounts Receivable

Inventory

Property, plant and equipment

Goodwill

Intangible assets

Accounts payable and accrued expenses

Deferred income taxes

Other assets and liabilities, net

BWI

Graham &
Maiman

DW3

Total 2018
Acquisitions

$

9,215

$

— $

8,590

$

10,736

2,222

3,739

2,970
(6,816)
—

240

6,090

19,557

10,996

2,750
(426)
—

—

5,059

8,196

33,623

62,873
(10,418)
(11,546)
(68)
96,309

17,805

21,885

29,975

48,358

68,593
(17,660)
(11,546)
172

Cash consideration, net of cash acquired

$

22,306

$

38,967

$

$

157,582

The fair values of intangible assets acquired are based on management's estimates and assumptions including 

variations of the income approach, the cost approach and the market approach. The intangible assets acquired are not 
expected to have any residual value. During the year ended December 29, 2019, we finalized the purchase price
allocation for the BWI acquisition, which resulted in a $0.4 million increase in goodwill due to final working capital
adjustments. We finalized the Graham & Maiman and DW3 purchase price allocations during the year ended December 
30, 2018. The gross contractual value of acquired trade receivables was $9.3 million and $9.1 million for the BWI and 
DW3 acquisitions, respectively.

Intangible assets acquired from the 2018 Acquisitions consist of the following:

(In thousands)

BWI

Customer relationships

$

1,200

Trademarks and tradenames

Patents

Other

Total intangible assets
acquired

Expected
Useful Life
(Years)

Graham &
Maiman

Expected
Useful Life
(Years)

$

10.0

10.0

2.2

2,400

350

—

—

10.0

$

1.5

Expected
Useful Life
(Years)

10.0

10.0

10.0

3.0

DW3

49,554

11,785

1,420

114

900

—

870

$

2,970

$

2,750

$

62,873

The following schedule represents the amounts of net sales and net income (loss) attributable to Masonite from 
the 2018 Acquisitions which have been included in the consolidated statements of comprehensive income for the period 
indicated subsequent to the acquisition date.

(In thousands)

Net sales

Net income (loss) attributable to Masonite

2017 Acquisition

Year Ended December 30, 2018

BWI

$

$

13,168
(1,231)

Graham &
Maiman

DW3

Total 2018
Acquisitions

38,901

$

68,474

$

120,543

314

6,712

5,795

On October 2, 2017, we completed the acquisition of A&F Wood Products, Inc. (“A&F”), through the purchase 

of 100% of the equity interests in A&F and certain assets of affiliates of A&F for consideration of $13.8 million, net of 
cash acquired. A&F is based in Howell, Michigan, and is a wholesaler and fabricator of architectural and commercial
doors in the Midwest United States. The excess purchase price over the fair value of net assets acquired of $5.9 million
was allocated to goodwill. The goodwill principally represents anticipated synergies from A&F's integration into our 

61

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

existing Architectural door business. This goodwill is not deductible for tax purposes and relates to the Architectural
segment.

The fair values of intangible assets acquired of $4.4 million are based on management’s estimates and 
assumptions including variations of the income approach, the cost approach and the market approach. Intangible assets 
acquired from A&F consist of customer relationships and are being amortized over the weighted average amortization
period of 10 years. The intangible assets are not expected to have any residual value.

The following schedule represents the amounts of net sales and net income attributable to Masonite from the 

A&F acquisition which have been included in the consolidated statements of comprehensive income for the period 
indicated subsequent to the acquisition date.

(In thousands)

Net sales

Net income attributable to Masonite

Pro Forma Information

December 31, 2017

$

3,883

825

The following unaudited pro forma financial information represents the consolidated financial information as if 

the acquisitions had been included in our consolidated results beginning on the first day of the fiscal year prior to their 
respective acquisition dates. The pro forma results have been calculated after adjusting the results of the acquired entities 
to remove intercompany transactions and transaction costs incurred and to reflect the additional depreciation and 
amortization that would have been charged assuming the fair value adjustments to property, plant and equipment and 
intangible assets had been applied on the first day of the fiscal year prior to the respective acquisitions, together with the 
consequential tax effects. The pro forma results do not reflect any cost savings, operating synergies or revenue 
enhancements that the combined company may achieve as a result of the acquisitions; the costs to combine the 
companies' operations; or the costs necessary to achieve these costs savings, operating synergies and revenue 
enhancements. The pro forma results do not necessarily reflect the actual results of operations of the combined 
companies under our ownership and operation.

(In thousands, except per share
amounts)

Masonite

BWI

Graham &
Maiman

DW3

Intercompany
Eliminations

Pro Forma

Net sales

$

2,170,103

Net income attributable to Masonite

92,710

77,110

436

26,887

89

4,918

$

(32,720) $

2,246,298

81

—

93,316

Year Ended December 30, 2018

Basic earnings per common share

$

Diluted earnings per common share

3.38

3.33

$

3.40

3.35

Year Ended December 31, 2017

(In thousands, except
per share amounts)

Masonite

BWI

Graham &
Maiman

DW3

A&F

Intercompany
Eliminations

Pro Forma

Net sales

Net income
attributable to
Masonite

$

2,032,925

104,291

65,468

58,086

$

11,104

$

(43,543) $

2,228,331

151,739

(1,811)

145

2,035

1,299

—

153,407

Basic earnings per
common share

$

Diluted earnings per
common share

5.18

5.09

$

5.24

5.15

62

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Dispositions

Window Widgets

On December 13, 2019, we completed the sale of all of the capital stock of Window Widgets Limited ("WW")

for consideration of $1.2 million, net of cash disposed. We have had and will continue to have no continuing 
involvement with WW subsequent to the sale. The disposition of this business resulted in a loss on disposal of 
subsidiaries of $9.7 million, which was recognized in 2019 in the Europe segment. The total charge consists of $8.3 
million relating to the write-off of the assets sold and other professional fees and $1.4 million relating to the recognition 
of the cumulative translation adjustment out of accumulated other comprehensive loss.

Performance Doorset Solutions Limited

On March 21, 2019, we completed the sale of all the capital stock of Performance Doorset Solutions Limited

("PDS") for nominal consideration. We have had and will continue to have no continuing involvement with PDS
subsequent to the sale, and the purchasers are not considered to be a related party. The disposition of this business 
resulted in a loss on disposal of subsidiaries of $4.6 million, which was recognized in 2019 in the Europe segment. The
total charge consists of $3.6 million relating to the write-off of the assets sold and other professional fees and $1.0 
million relating to the recognition of the cumulative translation adjustment out of accumulated other comprehensive loss.

Hungary

On June 28, 2017, we completed the liquidation of our legal entity in Hungary. As a result, we recognized $0.2

million of cumulative translation loss in loss on disposal of subsidiaries from accumulated other comprehensive loss
during the year ended December 31, 2017.

3. Accounts Receivable

Our customers consist mainly of wholesale distributors, dealers, and retail home centers. Our ten largest 

customers accounted for 44.9% and 54.6% of total accounts receivable as of December 29, 2019, and December 30, 
2018, respectively. Our largest customer, The Home Depot, Inc. accounted for more than 10% of the consolidated gross
accounts receivable balance as of December 29, 2019, and December 30, 2018. No other individual customer accounted 
for greater than 10% of the consolidated gross accounts receivable balance at either December 29, 2019, or 
December 30, 2018.

The changes in the allowance for doubtful accounts were as follows for the periods indicated:

(In thousands)

Balance at beginning of period

Additions charged to expense

Deductions

Balance at end of period

Year Ended

December 29, 2019 December 30, 2018 December 31, 2017

$

$

2,109

$

78
(435)
1,752

$

1,785

$

676
(352)
2,109

$

1,010

793
(18)
1,785

We maintain an accounts receivable sales program with a third party (the "AR Sales Program"). Under the AR 

Sales Program, we can transfer ownership of eligible trade accounts receivable of certain customers. Receivables are sold 
outright to a third party who assumes the full risk of collection, without recourse to us in the event of a loss. Transfers of 
receivables under this program are accounted for as sales. Proceeds from the transfers reflect the face value of the 
accounts receivable less a discount. Receivables sold under the AR Sales Program are excluded from trade accounts 
receivable in the consolidated balance sheets and are included in cash flows from operating activities in the consolidated 
statements of cash flows. The discounts on the sales of trade accounts receivable sold under the AR Sales Program were 
not material for any of the periods presented and were recorded in selling, general and administration expense within the 
consolidated statements of comprehensive income.

63

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

4. Inventories

The amounts of inventory on hand were as follows as of the dates indicated:

(In thousands)

Raw materials

Finished goods

Provision for obsolete or aged inventory

Inventories, net

December 29, 2019 December 30, 2018

$

$

179,155

$

70,211
(7,136)
242,230

$

189,145

69,026
(7,764)
250,407

We carry an inventory provision which is the result of obsolete or aged inventory. The rollforward of our 

inventory provision is as follows for the periods indicated:

(In thousands)

Balance at beginning of period

Additions charged to expense

Deductions

Balance at end of period

5. Property, Plant and Equipment

Year Ended
December 29, 2019 December 30, 2018 December 31, 2017

$

$

7,764

$

4,159
(4,787)
7,136

$

7,769

$

3,146
(3,151)
7,764

$

5,747

3,283
(1,261)
7,769

The carrying amounts of our property, plant and equipment and accumulated depreciation were as follows as of 

the dates indicated:

(In thousands)

Land

Buildings

Machinery and equipment

Property, plant and equipment, gross

Accumulated depreciation

Property, plant and equipment, net

December 29,
2019

December 30,
2018

$

29,706

$

207,318

741,954

978,978
(353,393)
625,585

$

$

30,653

179,888

724,431

934,972
(325,219)
609,753

Total depreciation expense was $70.7 million, $59.1 million, and $57.5 million for the years ended 

December 29, 2019, December 30, 2018, and December 31, 2017, respectively. Depreciation expense is included 
primarily within cost of goods sold in the consolidated statements of comprehensive income.

6. Leases

Lease Accounting Policy

Our updated policy for lease accounting, which we adopted for leases entered into beginning December 31,

2018, is as follows:

We determine if a contract is a lease at inception or upon acquisition and reevaluate each time a lease contract is 
amended or otherwise modified. A lease will be classified as an operating lease if it does not meet any of the criteria for a
finance lease. Those criteria include the transfer of ownership of the underlying asset by the end of the lease term; an
option to purchase the underlying asset that we would be reasonably certain to exercise; the lease term is for the major 
part of the remaining economic life of the underlying asset; the present value of the sum of the lease payments and any
residual value guaranteed by us that is not already reflected in the lease payments equals or exceeds substantially all of 
the fair value of the underlying asset or if the underlying asset is of such a specialized nature that it is expected to have
no alternative use to the lessor at the end of the lease term.

64

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

The assets and liabilities relating to operating leases are included in operating lease right-of-use assets, accrued 
expenses, and long-term operating lease liabilities in our consolidated balance sheets. The assets and liabilities relating to 
finance leases are included in property, plant and equipment, net and other liabilities in our consolidated balance sheets.

ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our 
obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at 
the respective lease commencement date based on the present value of lease payments over the expected lease term. 
Since our leases do not specify implicit discount rates, we use our incremental borrowing rate based on the information
available at the commencement date in determining the present value of lease payments. The operating lease ROU asset 
also includes any initial direct costs and is adjusted for lease incentives and prepaid or accrued rent. The lease term 
begins on the date when the lessor makes the underlying asset available for use to us, and our expected lease terms 
include options to extend the lease when it is reasonably certain that we will exercise those options. Lease payments are 
recognized in the consolidated statements of comprehensive income on a straight-line basis over the expected lease term.

Leases with an initial term of 12 months or less are not recorded on the balance sheet, with the related lease

expense recognized on a straight-line basis over the lease term. Lease and non-lease components of a contract are
combined into a single lease component for accounting purposes.

Our operating leases include leases for real estate (including manufacturing sites, warehouses and offices) and 

machinery and equipment and our finance leases include leases for real estate. We have no material subleases. Certain of 
our operating leases contain provisions for renewal ranging from one to four options of one to ten years each.

The following table summarizes the components of lease expense recorded in the consolidated statements of 

comprehensive income for the periods indicated:

(In thousands)

Operating lease expense

Finance lease expense

Amortization of leased assets

Interest on lease liabilities

Total lease expense

December 29, 2019

Year Ended
December 30, 2018

December 31, 2017

$

$

39,025

$

32,306

$

649

1,063

—

—

40,737

$

32,306

$

28,844

—

—

28,844

The following table includes a detail of lease assets and liabilities included in the consolidated balance sheet as 

of the period indicated:

(In thousands)

Operating lease right-of-use assets
Finance lease right-of-use assets (1)

Total lease assets, net

Current portion of operating lease liabilities

Long-term operating lease liabilities

Long-term finance lease liabilities

Total lease liabilities

____________

(1) Net of accumulated amortization of $0.6 million.

65

December 29, 2019

$

$

$

$

121,367

25,677

147,044

20,980

110,497

26,861

158,338

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table is a summary of the weighted-average remaining lease terms and weighted-average

discount rates of the Company's leases as of the period indicated:

Weighted-average remaining lease term (years)

Operating leases

Finance leases

Weighted-average discount rate (1)

Operating leases

Finance leases

____________
(1) Based on the Company's incremental borrowing rate at lease commencement.

December 29, 2019

11.4

29.7

4.6%

5.4%

As of December 29, 2019, the future minimum lease payments under non-cancelable leases are as follows:

(In thousands)

Fiscal year:

2020

2021

2022

2023

2024

Thereafter

Total minimum lease payments

Less imputed interest

Present value of future lease payments

Operating Leases

Finance Leases

$

$

27,197

$

20,058

17,276

14,212

13,515

87,088

179,346
(47,869)
131,477

$

1,393

1,326

1,365

1,287

1,445

52,981

59,797
(32,936)
26,861

As of December 29, 2019, we have additional undiscounted commitments for operating leases, primarily for 

administrative offices, that have not yet commenced of $18.8 million. These operating leases will commence during
fiscal year 2020 with lease terms of 5 to 10 years.

7. Goodwill and Intangible Assets

Changes in the carrying amount of goodwill were as follows as of the dates indicated:

(In thousands)

December 31, 2017
Goodwill from 2018 acquisitions

Foreign exchange fluctuations

December 30, 2018

Goodwill from 2019 acquisitions

Measurement period adjustment

Foreign exchange fluctuations

North American
Residential

Europe

Architectural

Total

$

$

2,867
3,349

(27)

6,189

—

390

11

$

35,431
33,623
(5,834)
63,220

1,083

171

2,128

$

100,151
10,996
(259)
110,888

—

—

112

138,449
47,968
(6,120)
180,297

1,083

561

2,251

December 29, 2019

$

6,590

$

66,602

$

111,000

$

184,192

66

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

During the year ended December 29, 2019, we finalized the purchase price allocation for the BWI and Top 
Doors acquisitions, which resulted in increases of 0.4 million and 0.2 million, respectively, in goodwill due to final 
working capital adjustments. We performed a quantitative impairment test of each of our reporting units during the 
fourth quarter of 2019 and determined that goodwill was not impaired.

The cost and accumulated amortization values of our intangible assets were as follows as of the dates indicated:

(In thousands)

Cost

Definite life intangible
assets:

December 29, 2019
Accumulated
Amortization

Net Book
Value

December 30, 2018
Accumulated
Amortization

Net Book
Value

Cost

Customer relationships $

173,856

$

(101,055) $

72,801

$

173,637

$

Patents

Software

Trademarks and
tradenames

Other

Total definite life
intangible assets

Indefinite life intangible
assets:

Trademarks and
tradenames

31,176

33,928

33,350

962

(23,784)

(32,529)

(7,324)

(527)

7,392

1,399

26,026

435

31,363

32,660

33,784

971

(81,220) $
(21,840)
(29,296)

(3,948)
(97)

92,417

9,523

3,364

29,836

874

273,272

(165,219)

108,053

272,415

(136,401)

136,014

76,479

—

76,479

76,031

—

76,031

Total intangible assets

$

349,751

$

(165,219) $

184,532

$

348,446

$

(136,401) $

212,045

During the year ended December 30, 2018, we reassessed certain tradenames that were previously classified as

indefinite-lived, and as a result of this assessment, we reclassified $20.7 million of tradenames into definite-lived and 
began to amortize them consistent with their expected useful lives. Amortization of intangible assets was $28.2 
million, $27.7 million and $24.2 million for the years ended December 29, 2019, December 30, 2018, and December 31, 
2017 respectively. Amortization expense is classified within selling, general and administration expenses in the 
consolidated statements of comprehensive income.

The estimated future amortization of intangible assets with definite lives as of December 29, 2019, is as

follows:

(In thousands)

Fiscal year:

2020

2021

2022

2023

2024

$

22,305

18,723

15,296

13,829

12,290

67

 
 
 
 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

8. Accrued Expenses

The details of our accrued expenses were as follows as of the dates indicated:

(In thousands)

Accrued payroll

Accrued rebates

Current portion of operating lease liabilities

Accrued interest

Other accruals

Total accrued expenses

9. Long-Term Debt

(In thousands)

5.375% senior unsecured notes due 2028

5.750% senior unsecured notes due 2026

5.625% senior unsecured notes due 2023

Unamortized premium on 2023 Notes

Debt issuance costs

Other long-term debt

Total long-term debt

December 29,
2019

December 30,
2018

$

60,876

$

33,556

20,980

16,913

48,080

39,823

36,711

—

14,570

56,241

$

180,405

$

147,345

December 29,
2019

December 30,
2018

$

500,000

$

300,000

—

—
(9,985)
969

—

300,000

500,000

3,684
(8,394)
1,108

$

790,984

$

796,398

Interest expense related to our consolidated indebtedness under senior unsecured notes was $46.1 million, $38.7 

million and $29.7 million for years ended December 29, 2019, December 30, 2018, and December 31, 2017, 
respectively. Debt issuance costs incurred in connection with the 2028 Notes and the 2026 Notes were capitalized as a 
reduction to the carrying value of debt and are being accreted to interest expense over their respective terms.
Additionally, we pay interest on any outstanding principal under our ABL Facility and we are required to pay a
commitment fee for unutilized commitments under the ABL Facility, both of which are recorded in interest expense as
incurred.

5.375% Senior Notes due 2028

On July 25, 2019, we issued $500.0 million aggregate principal senior unsecured notes (the "2028 Notes"). The

2028 Notes were issued in a private placement for resale to qualified institutional buyers pursuant to Rule 144A under 
the Securities Act, and to buyers outside of the United States pursuant to Regulation S under the Securities Act. The 2028
Notes were issued without registration rights and are not listed on any securities exchange. The 2028 Notes bear interest 
at 5.375% per annum, payable in cash semiannually in arrears on February 1 and August 1 of each year and are due
February 1, 2028. The 2028 notes were issued at par. We received net proceeds of $493.3 million after deducting $6.7 
million of debt issuance costs. The debt issuance costs were capitalized as a reduction to the carrying value of debt and 
are being accreted to interest expense over the term of the 2028 Notes using the effective interest method. The net 
proceeds from issuance of the 2028 Notes, together with available cash balances, were used to redeem the remaining 
$500.0 million aggregate principal amount of the 2023 Notes (as described below), including the payment of related 
premiums, fees and expenses.

Subsequent to the closing of the 2028 Notes offering, the 2023 Notes were redeemed, and the notes were
considered extinguished as of August 10, 2019. Under the terms of the indenture governing the 2023 Notes, we paid the 
applicable premium of $14.1 million. Additionally, the unamortized premium of $3.1 million and unamortized debt 
issuance costs of $3.5 million relating to the 2023 Notes were written off in conjunction with the extinguishment of the 
2023 Notes. The resulting loss on extinguishment of debt was $14.5 million and is recorded as part of income before 

68

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

income tax expense (benefit) in the condensed consolidated statements of comprehensive income. Additionally, the cash 
payment of interest accrued to, but not including, the redemption date was accelerated to the redemption date.

Obligations under the 2028 Notes are fully and unconditionally guaranteed, jointly and severally, on a senior 
unsecured basis, by certain of our directly or indirectly wholly-owned subsidiaries. We may redeem the 2028 Notes, in
whole or in part, at any time on or after February 1, 2023, at the applicable redemption prices specified under the 
indenture governing the 2028 Notes, plus accrued and unpaid interest, if any, to the date of redemption. If we experience 
certain changes of control or consummate certain asset sales and do not reinvest the net proceeds, we must offer to
repurchase all of the 2028 Notes at a purchase price of 101.00% of their principal amount, plus accrued and unpaid 
interest, if any, to, but excluding, the repurchase date.

The indenture governing the 2028 Notes contains restrictive covenants that, among other things, limit our 

ability and the ability of our subsidiaries to: (i) incur additional debt and issue disqualified or preferred stock, (ii) make 
restricted payments, (iii) sell assets, (iv) create or permit restrictions on the ability of our restricted subsidiaries to pay
dividends or make other distributions to the parent company, (v) create or incur certain liens, (vi) enter into sale and 
leaseback transactions, (vii) merge or consolidate with other entities and (viii) enter into transactions with affiliates. The 
foregoing limitations are subject to exceptions as set forth in the indenture governing the 2028 Notes. In addition, if in
the future the 2028 Notes have an investment grade rating from at least two nationally recognized statistical rating
organizations, certain of these covenants will be terminated. The indenture governing the 2028 Notes contains customary
events of default (subject in certain cases to customary grace and cure periods). As of December 29, 2019, we were in 
compliance with all covenants under the indenture governing the 2028 Notes.

5.750% Senior Notes due 2026

On August 27, 2018, we issued $300.0 million aggregate principal senior unsecured notes (the “2026 Notes”).

The 2026 Notes were issued in a private placement for resale to qualified institutional buyers pursuant to Rule 144A 
under the Securities Act, and to buyers outside of the United States pursuant to Regulation S under the Securities Act. 
The 2026 Notes were issued without registration rights and are not listed on any securities exchange. The 2026 Notes 
bear interest at 5.75% per annum, payable in cash semiannually in arrears on March 15 and September 15 of each year 
and are due September 15, 2026. The 2026 notes were issued at par. We received net proceeds of $295.7 million after 
deducting $4.3 million of debt issuance costs. The debt issuance costs were capitalized as a reduction to the carrying 
value of debt and are being accreted to interest expense over the term of the 2026 Notes using the effective interest 
method. The net proceeds from issuance of the 2026 Notes were used to redeem $125.0 million aggregate principal
amount of the 2023 Notes (as described below), including the payment of related premiums, fees and expenses, with the
balance of the proceeds available for general corporate purposes.

Subsequent to the closing of the 2026 Notes offering, the 2023 Notes were partially redeemed, with that portion

of the notes considered extinguished as of September 12, 2018. Under the terms of the indenture governing the 2023
Notes, we paid the applicable premium of $5.3 million. Additionally, the proportionate shares of the unamortized 
premium of $1.0 million and unamortized debt issuance costs of $1.1 million relating to the 2023 Notes were written off 
in conjunction with the partial extinguishment of the 2023 Notes. The resulting loss on extinguishment of debt was $5.4 
million and is recorded as part of income (loss) from continuing operations before income tax expense (benefit) in the 
consolidated statements of comprehensive income. Additionally, the cash payment of interest accrued to, but not 
including, the redemption date was accelerated to the redemption date.

Obligations under the 2026 Notes are fully and unconditionally guaranteed, jointly and severally, on a senior 
unsecured basis, by certain of our directly or indirectly wholly-owned subsidiaries. We may redeem the 2026 Notes, in
whole or in part, at any time on or after September 15, 2021, at the applicable redemption prices specified under the 
indenture governing the 2026 Notes, plus accrued and unpaid interest, if any, to the date of redemption. If we experience 
certain changes of control or consummate certain asset sales and do not reinvest the net proceeds, we must offer to
repurchase all of the 2026 Notes at a purchase price of 101.00% of their principal amount, plus accrued and unpaid 
interest, if any, to the repurchase date.

The indenture governing the 2026 Notes contains restrictive covenants that, among other things, limit our 

ability and the ability of our subsidiaries to: (i) incur additional debt and issue disqualified or preferred stock, (ii) make 
restricted payments, (iii) sell assets, (iv) create or permit restrictions on the ability of our restricted subsidiaries to pay

69

 
 
 
 
 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

dividends or make other distributions to the parent company, (v) create or incur certain liens, (vi) enter into sale and 
leaseback transactions, (vii) merge or consolidate with other entities and (viii) enter into transactions with affiliates. The 
foregoing limitations are subject to exceptions as set forth in the indenture governing the 2026 Notes. In addition, if in
the future the 2026 Notes have an investment grade rating from at least two nationally recognized statistical rating
organizations, certain of these covenants will be terminated. The indenture governing the 2026 Notes contains customary
events of default (subject in certain cases to customary grace and cure periods). As of December 29, 2019, we were in 
compliance with all covenants under the indenture governing the 2026 Notes.

5.625% Senior Notes due 2023

On September 27, 2017, and March 23, 2015, we issued $150.0 million and $475.0 million aggregate principal 

senior unsecured notes, respectively (the “2023 Notes”). The 2023 Notes were issued in two private placements for 
resale to qualified institutional buyers pursuant to Rule 144A under the Securities Act, and to buyers outside the United 
States pursuant to Regulation S under the Securities Act. The 2023 Notes were issued without registration rights and are
not listed on any securities exchange. The 2023 Notes bore interest at 5.625% per annum, payable in cash semiannually 
in arrears on March 15 and September 15 of each year and were due March 15, 2023. The 2023 Notes were issued at 
104.0% and par in 2017 and 2015, respectively, and the resulting premium of $6.0 million was being amortized to 
interest expense over the term of the 2023 Notes using the effective interest method. We received net proceeds of $153.9
million and $467.9 million, respectively, after deducting $2.1 million and $7.1 million of debt issuance costs in 2017 and 
2015, respectively. The debt issuance costs were capitalized as a reduction to the carrying value of debt and were being
accreted to interest expense over the term of the 2023 Notes using the effective interest method. The net proceeds from
the 2017 issuance of the 2023 Notes were for general corporate purposes. The net proceeds from the 2015 issuance of the
2023 Notes, together with available cash balances, were used to redeem the $500.0 million aggregate principal of 8.25%
senior unsecured notes due 2021 (the "2021 Notes") and to pay related premiums, fees and expenses. As of August 10,
2019, the 2023 Notes were fully redeemed, as described above.

ABL Facility

On January 31, 2019, we and certain of our subsidiaries amended and restated our asset-based revolving credit 
facility (the "ABL Facility") in order to extend the maturity date of the ABL Facility and amend certain other provisions. 
The amended and restated ABL Facility increased the revolving commitments to $250.0 million from $150.0 million and 
extended the final maturity date to date to January 31, 2024, from April 9, 2020. The borrowing base is calculated based 
on a percentage of the value of selected United States, Canadian and United Kingdom accounts receivable and inventory,
less certain ineligible amounts. Obligations under the ABL Facility are secured by a first priority security interest in such
accounts receivable, inventory and other related assets of Masonite and our subsidiaries. In addition, obligations under 
the ABL Facility are fully and unconditionally guaranteed, jointly and severally, on a senior secured basis, by certain of 
our directly or indirectly wholly-owned subsidiaries. Borrowings under the ABL Facility bear interest at a rate equal to,
at our option, (i) the United States, Canadian or United Kingdom Base Rate (each as defined in the credit agreement 
relating to the ABL Facility, the "Amended and Restated Credit Agreement") plus a margin ranging 
from 0.25% to 0.75% per annum, or (ii) the Adjusted LIBO Rate or BA Rate (each as defined in the Amended and 
Restated Credit Agreement), plus a margin ranging from 1.25% to 1.50% per annum. In addition to paying interest on 
any outstanding principal under the ABL Facility, a commitment fee is payable on the undrawn portion of the ABL 
Facility in an amount equal to 0.25% per annum of the average daily balance of unused commitments during each
calendar quarter. 

The ABL Facility contains various customary representations, warranties and covenants by us that, among other 
things, and subject to certain exceptions, restrict Masonite's ability and the ability of our subsidiaries to: (i) pay dividends
on our common shares and make other restricted payments, (ii) make investments and acquisitions, (iii) engage in
transactions with our affiliates, (iv) sell assets, (v) merge and (vi) create liens. The Amended and Restated Credit 
Agreement amended the ABL Facility to, among other things, (i) permit us to incur unlimited unsecured debt as long as
such debt does not contain covenants or default provisions that are more restrictive than those contained in the ABL 
Facility, (ii) permit us to incur debt as long as the pro forma secured leverage ratio is less than 4.5 to 1.0, and (iii) add 
certain additional exceptions and exemptions under the restricted payment, investment and indebtedness covenants 
(including increasing the amount of certain debt permitted to be incurred under an existing exception). As
of December 29, 2019, we were in compliance with all covenants under the credit agreement governing the ABL Facility. 

70

 
 
 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

We had availability of $198.0 million under our ABL Facility and there were no amounts outstanding as of December 29, 
2019.

10. Commitments and Contingencies

Indemnifications

We have provided customary indemnifications to our landlords under certain property lease agreements for 
claims by third parties in connection with their use of the premises. We also have provided routine indemnifications
against adverse effects related to changes in tax laws and patent infringements by third parties. The maximum amount of 
these indemnifications cannot be reasonably estimated due to their nature. In some cases, we have recourse against other 
parties to mitigate the risk of loss from these indemnifications. Historically, we have not made any significant payments 
relating to such indemnifications.

Class Action Proceedings

On October 19, 2018, a purported class action complaint was filed against us and JELD-WEN, Inc. (“JELD-

WEN”) in the United States District Court for the Eastern District of Virginia, Richmond Division, alleging, among other 
things, that defendants conspired to fix prices on, and to eliminate competition with respect to, interior molded doors.
The complaint asserts violations of Section 1 of the Sherman Act and seeks treble damages and costs of suit, including 
reasonable attorneys’ fees, prejudgment and post-judgment interest, and injunctive relief. On December 11, 2018, a
purported class action complaint with substantially similar allegations under various state antitrust or unfair competition
laws and the Sherman Act was filed in the United States District Court for the Eastern District of Virginia, Richmond 
Division, by several individuals and companies purporting to represent classes of certain indirect purchasers of interior 
molded doors. The complaint seeks damages (including statutory minimum, multiple, or exemplary damages, where
available), reasonable attorneys’ fees, prejudgment and post-judgment interest, and injunctive relief. Several other 
complaints with substantially similar allegations were subsequently filed in the same court by additional plaintiffs who 
also sought to represent purported classes of direct or indirect purchasers seeking similar damages and relief. These
multiple complaints have been consolidated into two proceedings-one for direct purchasers and another for indirect 
purchasers-both before the same judge in the United States District Court for the Eastern District of Virginia, Richmond 
Division. On January 17, 2019 we filed a motion to transfer the proceedings from the Eastern District of Virginia to
either the Middle District of Florida or Delaware and that motion was denied.

              On March 1, 2019, we filed a motion to dismiss all of the claims in both of these complaints. On September 18, 
2019, the Court ruled on Defendants' motion to dismiss the consolidated purported class action direct purchaser and 
indirect purchaser complaints filed against us and JELD-WEN. The Court: (i) denied Defendants’ motion to dismiss the
direct purchasers’ Sherman Act claims, (ii) granted Defendants’ motion to dismiss the direct purchasers’ fraudulent 
concealment claims (limiting the claims they may assert to those within four years of the filing of their complaint), and 
(iii) granted in part and denied in part Defendants’ motion to dismiss the state law claims filed by the indirect purchasers,
dismissing 66 of 91 state law claims. On October 31, 2019, the Court granted the indirect purchaser’s motion to amend 
their complaint in order to correct certain deficiencies identified by the Court in its order on the motion to dismiss
various state law claims. On November 25, 2019 the indirect purchasers filed an amended complaint that sought to 
reinstate 15 claims from plaintiffs residing in 8 states. Defendants moved to partially dismiss those reinstated claims on 
December 16, 2019. That motion remains pending before the Court. Fact discovery closed on January 31, 2020 and 
expert discovery is expected to close in April 2020. Briefing on class certification discovery is expected to be completed 
by April 10, 2020. Briefing on dispositive motions discovery is expected to be completed by July 9, 2020. The Court has
set a trial date of October 13, 2020.

We have not recognized an expense related to damages in connection with this matter because the likelihood of 

an adverse outcome and the amount or range of any potential loss cannot be reasonably estimated.

In addition, from time to time, we are involved in various claims and legal actions. In the opinion of 

management, the ultimate disposition of these matters, individually and in the aggregate, will not have a material adverse
effect on our financial condition, results of operations or cash flows.

71

 
 
 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

11. Revenues

We derive our revenues primarily from the manufacture and delivery of doors and door components as 

performance obligations that arise from our contracts with customers are satisfied. Materially all of our revenues are 
generated from contracts with customers and the nature, timing and any uncertainty in the recognition of revenues are 
not affected by the type of good, customer or geographical region to which the performance obligation relates. Our 
contracts with our customers are generally in the form of purchase orders and the performance obligation arises upon 
receipt of the purchase order and agreement upon the transaction price. The performance obligations are satisfied at a 
point in time when control of the promised goods is transferred to the customer and payment terms vary from customer 
to customer. Payment terms are short-term, are customary for our industry and in some cases, early payment incentives
are offered.

The transaction price recognized as revenue and accounts receivable is determined based upon a number of 

estimates, including:

• 

Incentive-based volume rebates, which are based on individual rebate agreements with our customers, as well as 
historical and expected performance of each individual customer,

•  Estimated sales returns, which are based on historical returns as a percentage of revenues, and
•  Adjustments for early payment discounts offered by us.

Contract assets are represented by our trade accounts receivable balances on the consolidated balance sheets, 

and are described in Note 3. Accounts Receivable. There were no other material contract assets or liabilities as of 
December 29, 2019 or December 30, 2018. Our warranties are assurance-type warranties and do not represent separate
performance obligations to our customers. There were no material impairment losses related to contract assets during the
years ended December 29, 2019, December 30, 2018, or December 31, 2017.

12. Share Based Compensation Plans

Share-based compensation expense was $10.0 million, $7.7 million and $11.6 million for the years ended 
December 29, 2019, December 30, 2018, and December 31, 2017, respectively. As of December 29, 2019, the total 
remaining unrecognized compensation expense related to share based compensation amounted to $13.9 million, which 
will be amortized over the weighted average remaining requisite service period of 1.5 years. Share based compensation
expense is recognized using a graded-method approach, or to a lesser extent a straight-line approach, depending on the
terms of the individual award, and is classified within selling, general and administration expenses in the consolidated 
statements of comprehensive income. All forfeitures are accounted for as they occur. All share based awards are settled 
through issuance of new shares of our common stock. The share based award agreements contain restrictions on sale or 
transfer other than in limited circumstances. All other transfers would cause the share based awards to become null and 
void.

Equity Incentive Plan

Prior to July 9, 2012, we had a management equity incentive plan (the "2009 Plan"). The 2009 Plan required 

granting by June 9, 2012, equity instruments which upon exercise would result in management (excluding directors)
owning 9.55% of our common equity (3,554,811 shares) on a fully diluted basis, after giving consideration to the 
potential exercise of warrants and the equity instruments granted to directors. Under the 2009 Plan, we were required to 
issue equity instruments to directors that represented 0.90% (335,004 shares) of the common equity on a fully diluted 
basis. The requirement for issuance to employees was satisfied in June 2012, and the requirement for issuance to 
directors was satisfied in July 2009. No awards have been granted under the 2009 Plan since May 30, 2012, and no
future awards will be granted under the 2009 Plan; however, all outstanding awards under the 2009 Plan will continue to
be governed by their existing terms. Aside from shares issuable for outstanding awards, there are no further shares of 
common stock available for future issuance under the 2009 Plan.

On July 12, 2012, the Board of Directors adopted the Masonite International Corporation 2012 Equity Incentive

Plan, which was amended on June 21, 2013, by our Board of Directors, further amended and restated by our Board of 
Directors on February 23, 2015, and approved by our shareholders on May 12, 2015 (as amended and restated, the "2012 
Plan"). The 2012 Plan was adopted because the Board of Directors believes awards granted will help to attract, motivate

72

 
 
 
 
 
 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

and retain employees and non-employee directors, align employee and stockholder interests and encourage a
performance-based culture built on employee stock ownership. The 2012 Plan permits us to offer eligible directors, 
employees and consultants cash and share-based incentives, including stock options, stock appreciation rights, restricted 
stock, other share-based awards (including restricted stock units) and cash-based awards. The 2012 Plan is effective for 
ten years from the date of its adoption. Awards granted under the 2012 Plan are at the discretion of the Human Resources
and Compensation Committee of the Board of Directors. The Human Resources and Compensation Committee may 
grant any award under the 2012 Plan in the form of a performance award. The 2012 Plan may be amended, suspended or 
terminated by the Board at any time; provided, that any amendment, suspension or termination which impairs the rights
of a participant is subject to such participant's consent and; provided further, that certain material amendments are
subject to shareholder approval. The aggregate number of common shares that can be issued with respect to equity
awards under the 2012 Plan cannot exceed 2,000,000 shares plus the number of shares subject to existing grants under 
the 2009 plan that may expire or be forfeited or cancelled. As of December 29, 2019, there were 759,053 shares of 
common stock available for future issuance under the 2012 Plan.

Deferred Compensation Plan

We offer to certain of our employees and directors a Deferred Compensation Plan ("DCP"). The DCP is an 

unfunded non-qualified deferred compensation plan that permits those certain employees and directors to defer a portion 
of their compensation to a future time. Eligible employees may elect to defer a portion of their base salary, bonus and/or 
restricted stock units and eligible directors may defer a portion of their director fees or restricted stock units. All 
contributions to the DCP on behalf of the participant are fully vested (other than restricted stock unit deferrals which 
remain subject to the vesting terms of the applicable equity incentive plan) and placed into a grantor trust, commonly
referred to as a "rabbi trust." Although we are permitted to make matching contributions under the terms of the DCP, we
have not elected to do so. The DCP invests the contributions in diversified securities from a selection of investments and 
the participants choose their investments and may periodically reallocate the assets in their respective accounts. 
Participants are entitled to receive the benefits in their accounts upon separation of service or upon a specified date, with
benefits payable as a single lump sum or in annual installments. All plan investments are categorized as having Level 1 
valuation inputs as established by the FASB’s Fair Value Framework.

Assets of the rabbi trust, other than Company stock, are recorded at fair value and included in other assets in the

consolidated balance sheets. These assets in the rabbi trust are classified as trading securities and changes in their fair 
values are recorded in other expense (income), net in the consolidated statements of comprehensive income. The liability
relating to deferred compensation represents our obligation to distribute funds to the participants in the future and is
included in other liabilities in the consolidated balance sheets. As of December 29, 2019, the liability and asset relating to 
deferred compensation had a fair value of $6.8 million and $7.0 million, respectively. As of December 30, 2018, the 
liability and asset relating to deferred compensation had a fair value of $6.0 million and $6.2 million, respectively. Any
gain or loss relating to changes in the fair value of the deferred compensation liability is recognized in selling, general
and administration expense in the consolidated statements of comprehensive income.

As of December 29, 2019, participation in the deferred compensation plan is limited and no restricted stock 

awards have been deferred into the deferred compensation plan.

Stock Appreciation Rights

We have granted Stock Appreciation Rights ("SARs") to certain employees under both the 2009 Plan and the

2012 Plan, which entitle the recipient to the appreciation in value of a number of common shares over the exercise price
over a period of time, each as specified in the applicable award agreement. The exercise price of any SAR granted may
not be less than the fair market value of our common shares on the date of grant. The compensation expense for the
SARs is measured based on the fair value of the SARs at the date of grant and is recognized over the requisite service 
period. The SARs vest over a maximum of four years, have a life of ten years and settle in common shares. It is assumed 
that all time-based SARs will vest.

The total fair value of SARs vested was $1.1 million, $0.7 million and $0.4 million, in the years ended 

December 29, 2019, December 30, 2018, and December 31, 2017, respectively.

73

 
 
 
 
 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Twelve months ended December 29, 2019

Stock
Appreciation
Rights

Aggregate
Intrinsic Value
(in thousands)

Weighted
Average
Exercise Price

Average
Remaining
Contractual
Life (Years)

Outstanding, beginning of period

514,313

$

7,254

$

Granted

Exercised

Forfeited

Outstanding, end of period

Exercisable, end of period

111,230
(212,767)
(8,329)
404,447

230,440

$

$

9,379

7,615

5,675

$

$

39.01

57.29

19.68

67.24

53.62

47.92

4.6

4.7

2.5

Twelve months ended December 30, 2018

Stock
Appreciation
Rights

Aggregate
Intrinsic Value
(in thousands)

Weighted
Average
Exercise Price

Average
Remaining
Contractual
Life (Years)

Outstanding, beginning of period

537,930

$

23,263

$

Granted

Exercised

Outstanding, end of period

Exercisable, end of period

69,752
(93,369)
514,313

391,428

$

$

4,731

7,254

7,254

$

$

32.00

65.00

18.03

39.01

30.20

4.5

4.6

3.4

Twelve months ended December 31, 2017

Stock
Appreciation
Rights

Aggregate
Intrinsic Value
(in thousands)

Weighted
Average
Exercise Price

Average
Remaining
Contractual
Life (Years)

Outstanding, beginning of period

790,290

$

32,659

$

Granted

Exercised

Forfeited

Outstanding, end of period

Exercisable, end of period

59,265
(281,444)
(30,181)
537,930

443,998

$

$

16,378

23,263

22,588

$

$

24.47

77.00

17.96

54.28

32.00

24.28

4.6

4.5

3.7

The value of SARs granted in the year ended December 29, 2019, as determined using the Black-Scholes-

Merton valuation model, was $1.4 million and is expected to be recognized over the average requisite service period of 
2.0 years. Expected volatility is based upon the historical volatility of our public industry peers’ common shares amongst 
other considerations. The expected term is calculated using the simplified method, due to insufficient exercise activity
during recent years as a basis from which to estimate future exercise patterns. The weighted average grant date
assumptions used for the SARs granted were as follows for the periods indicated:

SAR value (model conclusion)
Risk-free rate

Expected dividend yield

Expected volatility

Expected term (years)

2019 Grants

2018 Grants

2017 Grants

$

12.26

$

18.63

$

22.65

2.2%

0.0%

21.9%

6.0

2.7%

0.0%

22.8%

6.0

2.0%

0.0%

25.8%

6.0

74

 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Restricted Stock Units

We have granted Restricted Stock Units ("RSUs") to directors and certain employees under the 2012 Plan. The 

RSUs confer the right to receive shares of our common stock at a specified future date or when certain conditions are
met. The compensation expense for the RSUs awarded is based on the fair value of the RSUs at the date of grant and is 
recognized over the requisite service period. The RSUs vest over a maximum of three years and call for the underlying
shares to be delivered no later than 30 days following the vesting date unless the participant is subject to a blackout 
period. In such case, the shares are to be delivered once the blackout restriction has been lifted. It is assumed that all
time-based RSUs will vest.

December 29, 2019

Year Ended
December 30, 2018

December 31, 2017

Total
Restricted
Stock Units
Outstanding

Weighted
Average
Grant Date
Fair Value

Total
Restricted
Stock Units
Outstanding

Weighted
Average
Grant Date
Fair Value

Total
Restricted
Stock Units
Outstanding

Weighted
Average
Grant Date
Fair Value

66.03

56.31
57.51

429,027

$

303,740
(21,953)

(120,982)

(20,024)

(46,601)

66.14

63.55
63.49

417,598

$

227,487
25,046

(169,830)

(45,117)

(26,157)

501,926

$

163,835
78,212

(197,255)

(58,739)

(70,381)

58.51

78.29
54.73

Outstanding, beginning of
period

t

Granted
Performance adjustment (1)
Delivered
Withheld to cover (2)
Forfeited

r

Outstanding, end of period

523,207

$

59.58

429,027

$

66.03

417,598

$

66.14

____________
(1)  Performance-based RSUs are presented as outstanding, granted and forfeited in the table above assuming targets are met and the 
awards pay out at 100%. These awards are settled with payouts ranging from zero to 200% of the target award value depending on
achievement. The performance adjustment represents the difference in shares ultimately awarded due to performance attainment 
above or below target.

d

(2)  A portion of the vested RSUs delivered were net share settled to cover statutory requirements for income and other employment 
taxes. We remit the equivalent cash to the appropriate taxing authorities. These net share settlements had the effect of share
repurchases by us as we reduced and retired the number of shares that would have otherwise been issued as a result of the vesting.

Approximately four-fifths of the RSUs granted during the year ended December 29, 2019, vest at specified 
future dates with only service requirements, while the remaining portion of the RSUs vest based on both performance
and service requirements. The value of RSUs granted in the year ended December 29, 2019, was $17.1 million and is 
being recognized over the weighted average requisite service period of 2.3 years. During the year ended December 29, 
2019, there were 141,502 RSUs vested at a fair value of $8.8 million.

13. Restructuring Costs

Over the past several years, we have engaged in a series of restructuring programs related to exiting certain
geographies and non-core businesses, consolidating certain internal support functions and engaging in other actions 
designed to reduce our cost structure and improve productivity. These initiatives primarily consist of severance actions
and lease termination costs. Management continues to evaluate our business; therefore, in future years, there may be
additional provisions for new plan initiatives, as well as changes in previously recorded estimates, as payments are made 
or actions are completed. Asset impairment charges were also incurred in connection with these restructuring actions for 
certain assets sold, abandoned or made obsolete as a result of these programs. 

Restructuring costs include all salary-related severance benefits that are accrued and expensed when a
restructuring plan has been put into place, the plan has received approval from the appropriate level of management and 
the benefit is probable and reasonably estimable. In addition to salary-related costs, we incur other restructuring costs
when facilities are closed or capacity is realigned within the organization. Upon termination of a contract we record 

75

 
 
 
 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

liabilities and expenses pursuant to the terms of the relevant agreement. For non-contractual restructuring activities,
liabilities and expenses are measured and recorded at fair value in the period in which they are incurred.

In February 2019, we began implementing a plan to improve overall business performance that includes the
reorganization of our manufacturing capacity and a reduction of our overhead and selling, general and administration 
workforce across all of our reportable segments and in our head offices. The reorganization of our manufacturing 
capacity involves specific plants in the North American Residential and Architectural segments and costs associated with 
the closure of these plants and related headcount reductions began taking place in the first quarter of 2019 (collectively,
the "2019 Plan"). Costs associated with the 2019 Plan include severance, retention and closure charges and will continue 
through 2020. Additionally, the plan to divest non-core assets was determined to be a triggering event requiring a test of 
the carrying value of the definite-lived assets relating to the divestitures, as further described in Note 14. In the fourth
quarter of 2019, we initiated additional restructuring actions related to both manufacturing capacity and reduction of our 
overhead and selling, general and administration workforce and estimate that such actions will incur an additional $5
million to $6 million. As of December 29, 2019, we expect to incur approximately $6 million to $8 million of additional 
charges related to the 2019 Plan. 

During the fourth quarter of 2018, we began implementing a plan to reorganize and consolidate certain aspects

of our United Kingdom head office function and optimize our portfolio by divesting non-core assets to enable more 
effective and consistent business processes in the Europe segment. In addition, in the North American Residential 
segment we announced a new facility that will optimize and expand capacity through increased automation, which
resulted in the closure of one existing facility and related headcount reductions beginning in the second quarter of 2019
(collectively, the “2018 Plan”). Costs associated with the 2018 Plan included severance, retention and closure charges 
and continued throughout 2019. Additionally, the plan to divest non-core assets was determined to be a triggering event 
requiring a test of the carrying value of the definite-lived assets relating to the divestitures, as further described in Note
14. As of December 29, 2019, we do not expect to incur any material future charges related to the 2018 Plan.

Other plans initiated in prior years did not have a material impact on the consolidated statements of 
comprehensive income or consolidated statements of cash flows for the years ended December 29, 2019, December 30,
2018, or December 31, 2017, or on the consolidated balance sheets as of December 29, 2019, or December 30, 2018.

The following table summarizes the restructuring charges recorded for the periods indicated:

(In thousands)

2019 Plan
2018 Plan

$
$

Total Restructuring Costs $

North 
American 
Residential

5,459
1,470

6,929

(In thousands)

2018 Plan

Total Restructuring Costs

Year Ended December 29, 2019

Europe

Architectural

Corporate & 
Other

Total

$
$

$

$

$

396
926

1,322

$

506
—

506

$

1,019

$
— $

1,019

$

Year Ended December 30, 2018

North American
Residential

Europe

Total

275

275

$

1,349

1,349

$

$

7,380
2,396

9,776

1,624

1,624

76

 
 
 
 
 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Cumulative Amount Incurred Through
December 29, 2019

(In thousands)

2019 Plan

2018 Plan

$

$

Total Restructuring Costs $

North
American
Residential

Europe

Architectural

Corporate &
Other

Total

5,459

1,745

7,204

$

$

$

396

2,275

2,671

$

$

$

506

$

— $

506

$

1,019

$

— $

1,019

$

7,380

4,020

11,400

The changes in the accrual for restructuring by activity were as follows for the periods indicated:

(In thousands)

December 30,
2018

Severance

Closure Costs

Cash Payments

December 29,
2019

2019 Plan

2018 Plan

Other

Total

(In thousands)

2018 Plan

Other

Total

$

$

$

$

— $

5,100

$

2,280

$

596

58

1,995

—

401

—

654

$

7,095

$

2,681

$

(5,845) $
(2,992)
(58)
(8,895) $

1,535

—

—

1,535

December 31,
2017

Severance

Closure Costs

Cash Payments

December 30,
2018

— $

284

284

$

859

—

859

$

$

765

—

765

$

$

(1,028) $
(226)
(1,254) $

596

58

654

14. Asset Impairment

Asset impairment includes charges that are taken when impairment testing indicates that the carrying values of 

our long-lived assets or asset groups exceed their respective fair values. Definite-lived assets are evaluated for 
impairment when events or changes in circumstances indicate that the carrying value of an asset or asset group may not 
be recoverable. Indefinite-lived intangible assets and goodwill are tested annually for impairment on the last day of fiscal
November, or more frequently if events or changes in circumstances indicate the carrying value may not be recoverable. 
An impairment loss is recognized when the carrying value of the asset or asset group being tested exceeds its fair value,
except in the case of goodwill, which is tested based on the fair value of the reporting unit where the goodwill is
recorded.

During the year ended December 29, 2019, we recognized asset impairment charges of $13.8 million related to

two asset groups in the North American Residential segment, as a result of announced plant closures under the 2019 
Plan. This amount was determined based upon the excess of the asset groups' carrying values of property, plant and 
equipment and operating lease right-of-use assets over the respective fair values of such assets, determined using a 
discounted cash flows approach for each asset group. Each of these valuations was performed on a non-recurring basis 
and is categorized as having Level 3 valuation inputs as established by the FASB's Fair Value Framework. The Level 3 
unobservable inputs include an estimate of future cash flows and the salvage value for each of the asset groups. The fair 
value of the asset groups was determined to be $9.4 million, compared to a book value of $23.2 million, with the 
difference representing the asset impairment charge recorded in the condensed consolidated statements of comprehensive
income. 

During the year ended December 30, 2018, we recognized asset impairment charges of $5.2 million related to

one asset group in the Europe segment, as a result of the 2018 Plan. This amount was determined based upon the excess 
of the asset group's carrying value of property, plant and equipment and definite-lived intangible assets over the fair 
value of such assets, determined using a discounted cash flows approach. This valuation was performed on a non-
recurring basis and is categorized as having Level 3 valuation inputs as established by the FASB's Fair Value 

77

 
 
 
 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Framework. The Level 3 unobservable inputs include an estimate of future cash flows for the asset group and a market 
value for the asset group's property, plant and equipment. The fair value of the asset group was determined to be $3.2 
million, solely based upon the market value of the property, plant and equipment, compared to a book value of $8.4
million, with the difference representing the asset impairment charge recorded in the consolidated statements of 
comprehensive income. These assets were disposed of in 2019.

15. Income Taxes

For financial reporting purposes, income before income taxes includes the following components:

(In thousands)

December 29, 2019 December 30, 2018 December 31, 2017

Income before income tax expense (benefit):

Canada

Foreign

$

Total income before income tax expense (benefit) $

21,345

$

45,003

66,348

$

19,552

$

100,805

120,357

$

25,617

103,804

129,421

Year Ended

Income tax expense (benefit) for income taxes consists of the following:

Year Ended

(In thousands)

December 29, 2019 December 30, 2018 December 31, 2017

Current income tax expense (benefit):

Canada

Foreign

Total current income tax expense:

Deferred income tax expense (benefit):

Canada

Foreign

Total deferred income tax expense (benefit):

$

7,600

$

7,997

$

6,417

14,017

1,497

1,795

3,292

5,253

13,250

122

10,441

10,563

Income tax expense (benefit)

$

17,309

$

23,813

$

7,293
(623)
6,670

(22,287)
(11,943)
(34,230)
(27,560)

78

 
 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

The Canadian statutory rate is 26.7%, 26.5% and 26.5% for the years ended December 29, 2019, December 30, 2018, 
and December 31, 2017, respectively. A summary of the differences between expected income tax expense calculated at 
the Canadian statutory rate and the reported consolidated income tax expense (benefit) follows:

(In thousands)

December 29, 2019 December 30, 2018 December 31, 2017

Year Ended

Income tax expense computed at statutory income
tax rate

$

Foreign rate differential

Permanent differences

Disposal of subsidiaries

Income attributable to a permanent establishment

Change in valuation allowance

Tax exempt income

Share based compensation

Income tax credits

Foreign exchange gains (losses)

Unrecognized tax benefits

Change in tax rate

Change in tax rate due to U.S. reform

Limitation on executive compensation

Withholding and other taxes

Nondeductible interest

Other

$

17,702
(4,503)
1,195

2,751

148
(1,463)
(2,451)
(341)
(1,869)
(991)
(848)
267

—

773

2,006

4,814

119

Income tax expense (benefit)

$

17,309

$

31,895
(4,926)
(1,822)
(21)
1,873

3,878
(5,673)
(737)
(3,252)
(2,683)
646
(284)
—

2,038

3,631

—
(750)
23,813

$

$

34,477

2,772

1,527
(160)
347
(27,603)
(6,469)
(7,583)
(1,833)
770
(116)
1,209
(27,138)
—

1,943

—

297
(27,560)

79

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Deferred tax assets arise from available net operating losses and deductions. Our ability to use those net 

operating losses is dependent upon our results of operations in the tax jurisdictions in which such losses or deductions 
arose. The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and 
liabilities are presented below:

(In thousands)

Deferred tax assets:

Non-capital loss carryforwards

Capital loss carryforwards

Deferred interest expense

Pension and post-retirement liability

Accruals and reserves currently not deductible for tax purposes

Share based compensation
Income tax credits

Lease right-of-use assets

Other

Total deferred tax assets

Valuation allowance

Total deferred tax assets, net of valuation allowance

Deferred tax liabilities:

Plant and equipment

Intangibles

Basis difference in subsidiaries

Unrealized foreign exchange gain

Lease liabilities

Other

Total deferred tax liabilities

Net deferred tax liability

Year Ended

December 29, 2019 December 30, 2018

$

23,363

$

9,740

10,181

925

19,222

3,220
6,632

40,921

2,075

116,279
(15,569)
100,710

(77,882)
(32,491)
(7,771)
(328)
(37,930)
(1,828)
(158,230)
(57,520) $

$

24,536

12,674

8,990

3,410

16,683

3,314
5,694

—

2,114

77,415
(16,373)
61,042

(64,831)
(35,740)
(7,070)
(5,102)
—
(1,912)
(114,655)
(53,613)

Management assesses the available positive and negative evidence to estimate if sufficient future taxable 

income will be generated to use the existing deferred tax assets. 

As of December 29, 2019, and December 30, 2018, a valuation allowance of $15.6 million and $16.4 million, 

respectively, has been established to reduce the deferred tax assets to an amount that is more likely than not to be 
realized. We have established valuation allowances on certain deferred tax assets resulting from net operating loss
carryforwards and other assets in Costa Rica and the United Kingdom. Additionally, we have established valuation 
allowances on capital loss carryforwards in Canada. The amount of the deferred tax assets considered realizable,
however, could be adjusted if estimates of future taxable income during the carryforward period are reduced or increased 
or if objective negative evidence in the form of cumulative losses is no longer present and additional weight may be
given to subjective evidence such as our projections for growth.

80

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following is a rollforward of the valuation allowance for deferred tax assets:

Year Ended

(In thousands)

December 29, 2019 December 30, 2018 December 31, 2017

Balance at beginning of period

Additions charged to expense and other

Deductions

Balance at end of period

$

$

16,373

$

2,863
(3,667)
15,569

$

13,912

$

12,590
(10,129)
16,373

$

36,800

5,566
(28,454)
13,912

The losses carried forward for tax purposes are available to reduce future taxable income by $89.6 million. We 

can apply these losses against future taxable income based on the period of expiration as follows:

(In thousands)

2020-2027

2028-2040
Indefinitely

Total tax losses carried forward

Canada

Other Foreign

Total

$

$

— $

5,876

$

60,605
—

—
23,160

60,605

$

29,036

$

5,876

60,605
23,160

89,641

We believe that it is more likely than not that the benefit from certain net operating loss carryforwards will not 

be realized. In recognition of this risk, we have provided valuation allowances of $1.3 million on these gross net 
operating loss carryforwards. If or when recognized, the tax benefit related to any reversal of the valuation allowance on 
deferred tax assets as of December 29, 2019, will be accounted for as a reduction of income tax expense.

We have outside basis differences, including undistributed earnings in our foreign subsidiaries. For those 

subsidiaries in which we are considered to be indefinitely reinvested, no provision for Canadian income or local country
withholding taxes has been recorded. Upon reversal of the outside basis difference and/or repatriation of those earnings,
in the form of dividends or otherwise, we may be subject to both Canadian income taxes and withholding taxes payable 
to the various foreign countries. For those subsidiaries where the earnings are not considered indefinitely reinvested,
taxes have been provided as required. The determination of the unrecorded deferred tax liability for temporary 
differences related to investments in foreign subsidiaries that are considered to be indefinitely reinvested is not 
considered practical.

As of December 29, 2019, and December 30, 2018, our unrecognized tax benefits were $8.2 million and $9.1 

million, respectively, excluding interest and penalties. Included in the balance of unrecognized tax benefits as
of December 29, 2019, and December 30, 2018, are $5.8 million and $6.7 million, respectively, of tax benefits that, if 
recognized, would favorably impact the effective tax rate. The unrecognized tax benefits are recorded in other long-term
liabilities and as a reduction to related long-term deferred income taxes in the consolidated balance sheets. The changes
to our unrecognized tax benefits were as follows:

Year Ended

(In thousands)

December 29, 2019 December 30, 2018 December 31, 2017

Unrecognized tax benefit at beginning of period

$

9,084

$

8,560

$

Gross increases in tax positions in current period

Gross decreases in tax positions in prior period

Gross increases in tax positions in prior period

Lapse of statute of limitations

Decrease due to change in tax rate

46
(973)
—
(1)
—

508
(244)
274
(14)
—

Unrecognized tax benefit at end of period

$

8,156

$

9,084

$

9,004

1,208
(464)
1,336
(17)
(2,507)
8,560

81

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

We recognize interest and penalties accrued related to unrecognized tax benefits as income tax expense. During

the years ended December 29, 2019, December 30, 2018, and December 31, 2017, we recorded accrued interest of 0.3 
million, $0.5 million and $0.4 million, respectively. Additionally, we have recognized a liability for penalties of $0.4 
million, $0.4 million and $0.4 million, and interest of $2.9 million, $3.3 million and $3.2 million, respectively.

We estimate that the amount of unrecognized tax benefits will not significantly increase or decrease within the

12 months following the reporting date.

We are subject to taxation in Canada, the United States and other foreign jurisdictions. As of December 29, 

2019, the 2015 tax year is subject to Canadian income tax examination. We are no longer subject to Federal tax 
examinations in the United States for years prior to 2016 (except to the extent of loss carryforwards in 2012 and prior 
years). However, we are subject to United States state and local income tax examinations for years prior to 2014.

16. Earnings Per Share

Basic earnings per share ("EPS") is calculated by dividing earnings attributable to Masonite by the weighted 
average number of our common shares outstanding during the period. Diluted EPS is calculated by dividing earnings
attributable to Masonite by the weighted average number of common shares plus the incremental number of shares
issuable from non-vested and vested RSUs and SARs outstanding during the period.

(In thousands, except share and per share information)

December 29,
2019

Year Ended
December 30,
2018

December 31,
2017

Net income attributable to Masonite

$

44,602

$

92,710

$

151,739

Shares used in computing basic earnings per share

25,130,027

27,412,268

29,298,236

Effect of dilutive securities:

Incremental shares issuable under share compensation plans

322,695

452,960

516,423

Shares used in computing diluted earnings per share

25,452,722

27,865,228

29,814,659

Basic earnings per common share attributable to Masonite

$

Diluted earnings per common share attributable to Masonite $

1.77

1.75

$

$

3.38

3.33

$

$

5.18

5.09

Anti-dilutive instruments excluded from diluted earnings per
common share

295,879

120,881

51,129

The weighted average number of shares outstanding utilized for the diluted EPS calculation contemplates the
exercise of all currently outstanding SARs and the conversion of all RSUs. The dilutive effect of such equity awards is
calculated based on the weighted average share price for each fiscal period using the treasury stock method.

17. Segment Information 

Our reportable segments are organized and managed principally by end market: North American Residential,

Europe and Architectural. The North American Residential reportable segment is the aggregation of the Wholesale and 
Retail operating segments. The Europe reportable segment is the aggregation of the United Kingdom and the Central
Eastern Europe operating segments. The Architectural reportable segment consists solely of the Architectural operating 
segment. The Corporate & Other category includes unallocated corporate costs and the results of immaterial operating
segments which were not aggregated into any reportable segment. Operating segments are aggregated into reportable
segments only if they exhibit similar economic characteristics. In addition to similar economic characteristics we also 
consider the following factors in determining the reportable segments: the nature of business activities, the management 
structure directly accountable to our chief operating decision maker for operating and administrative activities, 
availability of discrete financial information and information presented to the Board of Directors and investors.

82

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Our management reviews net sales and Adjusted EBITDA (as defined below) to evaluate segment performance

and allocate resources. Net assets are not allocated to the reportable segments. Adjusted EBITDA is a non-GAAP 
financial measure which does not have a standardized meaning under GAAP and is unlikely to be comparable to similar 
measures used by other companies. Adjusted EBITDA should not be considered as an alternative to either net income or 
operating cash flows determined in accordance with GAAP. Adjusted EBITDA is defined as net income (loss) 
attributable to Masonite adjusted to exclude the following items:

• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 

depreciation; 
amortization; 
share based compensation expense;
loss (gain) on disposal of property, plant and equipment; 
registration and listing fees;
restructuring costs;
asset impairment;
loss (gain) on disposal of subsidiaries;
interest expense (income), net; 
loss on extinguishment of debt;
other expense (income), net; 
income tax expense (benefit); 
loss (income) from discontinued operations, net of tax; and 
net income (loss) attributable to non-controlling interest. 

This definition of Adjusted EBITDA differs from the definitions of EBITDA contained in the indenture 
governing the 2028 and 2026 Notes and the credit agreement governing the ABL Facility. Although Adjusted EBITDA is
not a measure of financial condition or performance determined in accordance with GAAP, it is used to evaluate and 
compare the operating performance of the segments and it is one of the primary measures used to determine employee
incentive compensation. Intersegment sales are recorded using market prices.

Certain information with respect to reportable segments is as follows for the periods indicated:

(In thousands)

Sales

Intersegment sales

Net sales to external customers

Adjusted EBITDA

Depreciation and amortization

Interest expense, net

Income tax expense

Year Ended December 29, 2019

$

$

$

North
American
Residential

1,469,194

(3,386)

1,465,808

232,512

37,689

—

—

$

$

$

Europe

Architectural

Corporate &
Other

$

$

$

323,137
(1,506)
321,631

46,219

26,257

—

—

$

$

$

380,300
(14,997)
365,303

40,470

19,705

—

—

23,941

—

23,941

$

$

(35,817) $
16,198

46,489

17,309

Total

2,196,572
(19,889)
2,176,683

283,384

99,849

46,489

17,309

83

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands)

Sales

Intersegment sales

Net sales to external customers

Adjusted EBITDA

Depreciation and amortization

Interest expense, net

Income tax expense

(In thousands)

Sales

Intersegment sales

Net sales to external customers

Adjusted EBITDA

Depreciation and amortization

Interest expense, net

Income tax benefit

$

$

$

North
American
Residential

1,458,957

(4,198)

1,454,759

202,465

31,425

—

—

$

$

$

North
American
Residential

1,433,268

(4,338)

1,428,930

200,179

33,167

—

—

$

$

$

$

$

$

Year Ended December 30, 2018

Europe

Architectural

Corporate &
Other

$

$

$

371,069
(2,066)
369,003

44,985

24,638

—

—

$

$

$

340,609
(17,137)
323,472

37,742

19,667

—

—

22,869

—

22,869

$

$

(17,256) $
11,942

39,008

23,813

Year Ended December 31, 2017

Europe

Architectural

Corporate &
Other

$

$

$

295,862
(3,936)
291,926

33,820

17,455

—

—

$

$

$

307,237
(18,773)
288,464

30,050

17,774

—

—

23,605

—

23,605

$

$

(9,543) $
13,507

30,153
(27,560)

Total

2,193,504
(23,401)
2,170,103

267,936

87,672

39,008

23,813

Total

2,059,972
(27,047)
2,032,925

254,506

81,903

30,153
(27,560)

A reconciliation of our consolidated Adjusted EBITDA to net income attributable to Masonite is set forth as

follows for the periods indicated: 

(In thousands)

December 29, 2019 December 30, 2018 December 31, 2017

Net income attributable to Masonite

$

44,602

$

92,710

$

151,739

Year Ended

Plus:

Depreciation

Amortization

Share based compensation expense

Loss on disposal of property, plant and equipment

Restructuring costs

Asset impairment

Loss on disposal of subsidiaries

Interest expense, net

Loss on extinguishment of debt

Other expense (income), net

Income tax expense

70,736

29,113

10,023

6,396

9,776

13,767

14,260

46,489

14,523

1,953

17,309

59,089

28,583

7,681

3,470

1,624

5,243

—

39,008

5,414
(2,533)
23,813

Net income attributable to non-controlling interest
Adjusted EBITDA

$

4,437
283,384

$

3,834
267,936

$

84

57,528

24,375

11,644

1,893

850

—

212

30,153

—
(1,570)
(27,560)
5,242
254,506

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

We derive revenues from two major product lines: interior and exterior products. We do not review or analyze 
our two major product lines below net sales. Additionally, we sell door components to external customers which are not 
otherwise consumed in our vertical operations. Sales for the product lines are summarized as follows for the periods
indicated:

(In thousands)

Net sales to external customers:
Interior products (1)
Exterior products (1)
Components (1)
Total

December 29, 2019 December 30, 2018 December 31, 2017

Year Ended

$

$

1,427,459

$

1,429,532

$

1,366,871

628,301

120,923

612,888

127,683

557,808

108,246

2,176,683

$

2,170,103

$

2,032,925

____________
(1) Prior year amounts have been reclassified to conform to the current year presentation. There were no impacts at the reportable segment level.

a

Net sales information with respect to geographic areas exceeding 10% of consolidated net sales is as follows for 

the periods indicated:

(In thousands)

December 29, 2019 December 30, 2018 December 31, 2017

Net sales to external customers from facilities in:

Year Ended

United States

Canada

United Kingdom

Other

Total

$

$

1,483,697

$

1,388,680

$

1,333,223

304,497

281,888

106,601

329,292

328,669

123,462

327,644

253,564

118,494

2,176,683

$

2,170,103

$

2,032,925

In the years ended December 29, 2019, December 30, 2018, and December 31, 2017, net sales to The Home 

Depot, Inc., were $372.4 million, $385.3 million and $356.5 million, respectively, which are included in the North 
American Residential segment. No other individual customer's net sales exceeded 10% of consolidated net sales for any 
of the periods presented.

Geographic information regarding property, plant and equipment which exceed 10% of consolidated property, 

plant and equipment is as follows as of the dates indicated:

(In thousands)

United States

Canada

Other

Total

December 29, 2019

December 30, 2018

$

$

396,914

$

63,786

164,885

625,585

$

412,072

62,626

135,055

609,753

85

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

18. Employee Future Benefits

United States Defined Benefit Pension Plan

We have a defined benefit pension plan covering certain active and former employees in the United States

(“U.S.”). Benefits under the plan were frozen at various times in the past. The measurement date used for the accounting
valuation of the defined benefit pension plan was December 29, 2019. Information about the U.S. defined benefit 
pension plan is as follows for the periods indicated:

(In thousands)

December 29, 2019 December 30, 2018 December 31, 2017

Year Ended

Components of net periodic benefit cost:

Service cost

Interest cost

Expected return on assets

Amortization of actuarial net losses

Settlement loss

Net pension expense (benefit)

$

$

548

$

670

$

3,423
(5,723)
1,521

5,651

5,420

$

3,322
(6,253)
1,149

—
(1,112) $

811

3,421
(5,852)
1,113

—
(507)

During the fourth quarter of 2019, the plan purchased annuity contracts to settle liabilities for certain fully 

vested participants associated with benefits arising under the plan. Payments related to this offer were made from
existing plan assets to settle the liabilities. As a result, total lump sum payments exceeded annual service and interest 
costs in 2019, and we recognized a pre-tax pension settlement charge of $5.7 million in the fourth quarter of 2019. This 
non-cash charge is recorded within other expense (income), net in the consolidated statements of comprehensive income.

Information with respect to the assets, liabilities and net accrued benefit obligation of the U.S. defined benefit 

pension plan is set forth as follows for the periods indicated:

(In thousands)

Pension assets:

Year Ended

December 29, 2019 December 30, 2018

Fair value of plan assets, beginning of year

$

86,992

$

Company contributions

Actual return on plan assets

Plan settlements

Benefits paid

Administrative expenses paid

Fair value of plan assets, end of year

Pension liability:

Accrued benefit obligation, beginning of year

Current service cost

Interest cost

Plan settlements

Actuarial loss (gain)

Benefits paid

Administrative expenses paid

Accrued benefit obligation, end of year

5,000

17,030
(23,556)
(5,560)
(484)
79,422

95,171

548

3,423
(23,556)
9,015
(5,560)
(484)
78,557

Net plan assets (accrued benefit obligation), end of year

$

865

$

86

92,716

5,000
(4,453)
—
(5,730)
(541)
86,992

104,909

670

3,322

—
(7,459)
(5,730)
(541)
95,171
(8,179)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

The net plan assets are carried within other assets in the consolidated balance sheets. Pension fund assets are 

invested primarily in equity and debt securities. Asset allocation between equity and debt securities and cash is adjusted 
based on the expected life of the plan and the expected retirement age of the plan participants. No plan assets are
expected to be returned to us in the next twelve months. Information with respect to the amounts and types of securities 
that are held in the U.S. defined benefit pension plan is set forth as follows for the periods indicated:

(In thousands)

Equity securities

Debt securities

Other

Year Ended

December 29, 2019

December 30, 2018

Amount

% of Total
Plan

Amount

% of Total
Plan

$

$

47,017

29,863

2,542

79,422

59.2% $

37.6%

3.2%

100.0% $

51,412

32,361

3,219

86,992

59.1%

37.2%

3.7%

100.0%

Under the Plan's investment policy statement, plan assets are invested to achieve a fully-funded status based on 

actuarial calculations, maintain a level of liquidity that is sufficient to pay benefit and expense obligations when due, 
maintain flexibility in determining the future level of contributions and maximize returns within the limits of risk. The 
target asset allocation for plan assets in the U.S. defined benefit pension plan for 2019 is 60% equity securities, 38% debt 
securities and 2% of other securities. Our pension funds are not invested directly in the debt or equity of Masonite, but 
may have been invested indirectly as a result of inclusion of Masonite in certain market or investment funds.

The weighted average actuarial assumptions adopted in measuring our U.S. accrued benefit obligations and 

costs were as follows for the periods indicated:

December 29, 2019 December 30, 2018 December 31, 2017

Year Ended

Discount rate applied for:

Accrued benefit obligation

Net periodic pension cost

Expected long-term rate of return on plan assets

3.3%

4.3%

6.8%

4.3%

3.6%

6.8%

3.6%

4.2%

7.0%

The rate of compensation increase for the accrued benefit obligation and net periodic pension costs for the U.S.

defined benefit pension plan is not applicable, as benefits under the plan are not affected by compensation increases.

The expected long-term rate of return on plan assets assumption is derived by taking into consideration the

target plan asset allocation, historical rates of return on those assets, projected future asset class returns and net 
outperformance of the market by active investment managers. An asset return model is used to develop an expected 
range of returns on the plan investments over a 30-year period, with the expected rate of return selected from a best 
estimate range within the total range of projected results.

87

 
 
 
 
 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

United Kingdom Defined Benefit Pension Plan 

We also have a defined benefit pension plan in the United Kingdom (“U.K.”), which has been curtailed in prior 

years. The measurement date used for the accounting valuation of the U.K. defined benefit pension plan was
December 29, 2019. Information about the U.K. defined benefit pension plan is as follows for the periods indicated:

(in thousands)

December 29, 2019 December 30, 2018 December 31, 2017

Year Ended

Components of net periodic benefit cost:

Interest cost

Expected return on assets

Amortization of actuarial net losses

Net pension expense (benefit)

$

$

$

685
(948)
246
(17) $

$

648
(990)
142
(200) $

685
(429)
—

256

Information with respect to the assets, liabilities and net accrued benefit obligation of the U.K. defined benefit 

pension plan is as follows for the periods indicated:

(In thousands)

Pension assets:

Year Ended

December 29, 2019

December 30, 2018

Fair value of plan assets, beginning of year

$

22,307

$

Company contributions

Actual return on plan assets

Benefits paid

Translation adjustment

Fair value of plan assets, end of year

Pension liability

Accrued benefit obligation, beginning of year

Interest cost

Actuarial loss (gain)

Benefits paid

Plan amendment
Translation adjustment

1,265

3,201
(863)
838

26,748

28,303

685

3,446
(863)
—
1,030

Accrued benefit obligation, end of year

Net accrued benefit obligation, end of year

$

32,601

5,853

$

25,141

661
(1,106)
(886)
(1,503)
22,307

30,812

648
(962)
(886)
585
(1,894)
28,303

5,996

88

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

The net accrued benefit obligation is recorded within other long-term liabilities in the consolidated balance

sheets. Pension fund assets are invested primarily in equity and debt securities. Asset allocation between equity and debt 
securities and cash is adjusted based on the expected life of the plan and the expected retirement age of the plan 
participants. Information with respect to the amounts and types of securities that are held in the U.K. defined benefit 
pension plan is set forth as follows for the periods indicated:

(In thousands)

Equity securities

Debt securities

Other

Year Ended

December 29, 2019

December 30, 2018

Amount

% of Total
Plan

Amount

% of Total
Plan

$

$

10,297

13,600

2,851

26,748

38.5% $

50.8%

10.7%

100.0% $

10,207

11,909

191

22,307

45.8%

53.3%

0.9%

100.0%

Under the Plan's investment policy and strategy, plan assets are invested to achieve a fully funded status based 
on actuarial calculations, maintain a level of liquidity that is sufficient to pay benefit and expense obligations when due,
maintain flexibility in determining the future level of contributions and maximize returns within the limits of risk. The 
target asset allocation for plan assets in the U.K. defined benefit pension plan for 2019 is 50% equity securities 
and 50% debt securities.

The weighted average actuarial assumptions adopted in measuring our U.K. accrued benefit obligations and 

costs were as follows for the periods indicated:

Year Ended
December 29, 2019 December 30, 2018 December 31, 2017

Discount rate applied for:

Accrued benefit obligation

Net periodic pension cost

Expected long-term rate of return on plan assets

1.9%

1.7%

3.9%

2.7%

2.4%

4.2%

2.4%

2.2%

4.0%

The rate of compensation increase for the accrued benefit obligation and net pension cost for the U.K. defined 

benefit pension plan is not applicable, as the plan was curtailed in prior years and benefits under the plan are not affected 
by compensation increases.

The expected long-term rate of return on plan assets assumption is derived by taking into consideration the

target plan asset allocation, historical rates of return on those assets, projected future asset class returns and net 
outperformance of the market by active investment managers. An asset return model is used to develop an expected 
range of returns on the plan investments over a 9-year period, with the expected rate of return selected from a best 
estimate range within the total range of projected results.

Overall Pension Obligation

For all periods presented, the U.S. and U.K. defined benefit pension plans were invested in equity securities,
equity funds, bonds, bond funds and cash and cash equivalents. Other than those recorded at net asset value per share 
(NAV) as described below, all investments are publicly traded and possess a high level of marketability or liquidity. All
plan investments are categorized as having Level 1 valuation inputs as established by the FASB’s Fair Value Framework.

As of December 29, 2019, the U.S. defined benefit pension plan held an investment valued at NAV representing

$8.0 million of total plan assets. The investment is a collective investment trust consisting primarily of publicly traded 
U.S. and non-U.S. equities. Publicly traded equities are valued at the closing price reported in the active market in which
the individual securities are traded. Redemptions can be made daily with redemptions greater than $0.2 million requiring
a five day redemption notice period. There were no unfunded commitments as of December 29, 2019.

89

 
 
 
 
 
 
 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

The change in the net difference between the pension plan assets and projected benefit obligation that is not 
attributed to our recognition of pension expense or funding of the plan is recognized in other comprehensive income
(loss) within the consolidated statements of comprehensive income and the balance of such changes is included in 
accumulated other comprehensive loss (“AOCL”) in the consolidated balance sheets. The estimated actuarial net losses 
that will be amortized from AOCL into net periodic benefit cost during 2020 are $1.0 million.

As of December 29, 2019, the estimated future benefit payments from the U.S. and U.K. defined benefit 

pension plans for the following future periods are set forth as follows:

(In thousands)

Fiscal year:

2020

2021

2022

2023
2024

2025 through 2029

Total estimated future benefit payments

Expected Future Benefit Payments

$

$

5,356

5,632

5,753

5,867
5,975

30,620

59,203

Expected contributions to the U.S. and U.K. defined benefit pension plans during 2020 are $5.8 million.

Defined Contribution Benefit Plans

We have defined contribution benefit plans covering certain U.S. and foreign subsidiary employees subject to

eligibility requirements set up in accordance with local statutory requirements. Contributions made to these plans 
were $12.4 million, $11.8 million and $7.8 million for the years ended December 29, 2019, December 30, 2018, and 
December 31, 2017, respectively.

90

 
 
 
 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

19. Accumulated Other Comprehensive Loss and Other Comprehensive Income (Loss)

A rollforward of the components of accumulated other comprehensive loss is as follows for the periods

indicated:

(In thousands)

December 29,
2019

Year Ended
December 30,
2018

December 31,
2017

Accumulated foreign exchange losses, beginning of period

$

Foreign exchange gain (loss)

Income tax benefit (expense) on foreign exchange losses

Cumulative translation adjustment recognized upon
deconsolidation of subsidiaries

Less: foreign exchange gain (loss) attributable to non-controlling
interest

Accumulated foreign exchange losses, end of period

(129,930) $
14,544

25

2,368

(89,824) $
(40,880)
(60)

(127,433)
38,758
(609)

—

212

343
(113,336)

(834)
(129,930)

752
(89,824)

Accumulated pension and other post-retirement adjustments,
beginning of period

Pension and other post-retirement adjustments

Income tax (expense) benefit on pension and other post-
retirement adjustments

Amortization of actuarial net losses

Income tax expense on amortization of actuarial net losses

Pension settlement charges

Income tax expense on pension settlement charges

Accumulated pension and other post-retirement adjustments

(22,989)
962

(347)
1,798
(442)
5,651
(1,466)
(16,833)

(20,328)
(4,754)

1,113

1,291
(311)
—

—
(22,989)

(21,553)
529

39

1,113
(456)
—

—
(20,328)

Accumulated other comprehensive loss

Other comprehensive income (loss), net of tax:

Less: other comprehensive income (loss) attributable to non-
controlling interest

Other comprehensive income (loss) attributable to Masonite

$

$

$

(130,169) $

(152,919) $

(110,152)

23,093

$

(43,601) $

39,586

343

22,750

$

(834)
(42,767) $

752

38,834

Cumulative translation adjustments are reclassified out of accumulated other comprehensive loss into loss on 

disposal of subsidiaries in the years ended December 29, 2019, and December 31, 2017, in the consolidated statements of 
comprehensive income. Actuarial net losses are reclassified out of accumulated other comprehensive loss into cost of 
goods sold in the consolidated statements of comprehensive income. Pension settlement charges are reclassified out of 
accumulated other comprehensive loss into other expense (income), net, in the consolidated statements of comprehensive 
income.

91

 
 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

20. Supplemental Cash Flow Information

Certain cash and non-cash transactions were as follows for the periods indicated:

(In thousands)

Transactions involving cash:

Interest paid

Interest received

Income taxes paid

Income tax refunds

Cash paid for operating lease liabilities

Cash paid for finance lease liabilities

Non-cash transactions from operating activities:

Right-of-use assets acquired under operating leases
Non-cash transactions from investing and financing
activities:

Right-of-use assets acquired under finance leases

December 29,
2019

Year Ended
December 30,
2018

December 31,
2017

$

44,388

$

35,877

$

2,064

14,809

1,713

24,522

528

36,774

26,326

1,304

10,858

124

—

—

—

—

27,396

381

10,169

68

—

—

—

—

The following reconciles total cash, cash equivalents and restricted cash as of the dates indicated:

Cash and cash equivalents

Restricted cash

Total cash, cash equivalents and restricted cash

December 29, 2019

December 30, 2018

$

$

166,964

$

10,644

177,608

$

115,656

10,485

126,141

Property, plant and equipment additions in accounts payable were $6.3 million and $8.7 million as 

of December 29, 2019, and December 30, 2018, respectively.

During the fourth quarter of 2018, we provided debt financing to a distribution company via an interest-bearing 

note that is scheduled to mature in 2028. The interest-bearing note receivable is carried at amortized cost, with the
interest payable in kind at the election of the borrower. This transaction is reflected as issuance of note receivable on the
statements of cash flows and is recorded as a component of other assets on the consolidated balance sheets.

92

 
 
 
 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

21. Variable Interest Entity

As of December 29, 2019, and December 30, 2018, we held an interest in one variable interest entity ("VIE"), 

Magna Foremost Sdn Bhd, which is located in Bintulu, Malaysia. The VIE is integrated into our supply chain and 
manufactures door facings. We are the primary beneficiary of the VIE based on the terms of the existing supply 
agreement with the VIE. As primary beneficiary via the supply agreement, we receive a disproportionate amount of 
earnings on sales to third parties in relation to our voting interest, and as a result, receive a majority of the VIE’s residual 
returns. Sales to third parties did not have a material impact on our consolidated financial statements. We also have the 
power to direct activities of the VIE that most significantly impact the entity’s economic performance. As its primary
beneficiary, we have consolidated the results of the VIE. Our net cumulative investment in the VIE was comprised of the
following as of the dates indicated:

(In thousands)

Current assets

Property, plant and equipment, net
Long-term deferred income taxes

Other assets

Current liabilities

Other long-term liabilities

Non-controlling interest

December 29,
2019

December 30,
2018

$

10,662

$

8,179
3,032

3,575
(2,989)
(517)
(3,730)
18,212

$

9,632

9,327
4,306

3,122
(2,653)
(859)
(3,835)
19,040

Net assets of the VIE consolidated by Masonite

$

Current assets include $6.5 million and $5.7 million of cash and cash equivalents as of December 29, 2019, and 

December 30, 2018, respectively. Assets recognized as a result of consolidating this VIE do not represent additional
assets that could be used to satisfy claims against our general assets. Furthermore, liabilities recognized as a result of 
consolidating these entities do not represent additional claims on our general assets; rather, they represent claims against 
the specific assets of the consolidated VIE.

22. Fair Value of Financial Instruments

The carrying amounts of our cash and cash equivalents, restricted cash, accounts receivable, income taxes 

receivable, accounts payable, accrued expenses and income taxes payable approximate fair value because of the short-
term maturity of those instruments. The estimated fair values and carrying values of our long-term debt instruments were 
as follows for the periods indicated:

December 29, 2019

December 30, 2018

(In millions)

Fair Value

Carrying Value

Fair Value

Carrying Value

5.375% Senior unsecured notes due 2028

$

529.1

$

493.6

$

— $

5.750% Senior unsecured notes due 2026

5.625% Senior unsecured notes due 2023

318.8

—

296.4

—

282.6

484.9

—

295.8

499.5

These estimates are based on market quotes and calculations based on current market rates available to us and 
are categorized as having Level 2 valuation inputs as established by the FASB’s Fair Value Framework. Market quotes 
used in these calculations are based on bid prices for our debt instruments and are obtained from and corroborated with
multiple independent sources. The market quotes obtained from independent sources are within the range of 
management’s expectations.

93

 
 
 
 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

23. Supplemental Unaudited Quarterly Financial Information

The following table sets forth the historical unaudited quarterly financial data for the periods indicated. The 

information for each of these periods has been prepared on the same basis as the audited consolidated financial 
statements and, in our opinion, reflects all adjustments necessary to present fairly our financial results. Operating results
for previous periods do not necessarily indicate results that may be achieved in any future period.

(In thousands, except per share information)

December 29,
2019

September 29,
2019

June 30,
2019

March 31,
2019

Quarter Ended

$

531,237

$

552,192

$

562,943

$

Net sales

Cost of goods sold

Gross profit

Selling, general and administration expenses

Restructuring costs

Asset impairment
Loss on disposal of subsidiaries
Operating income

Interest expense, net

Loss on extinguishment of debt

Other expense (income), net

Income before income tax expense

Income tax expense

Net income

Less: net income attributable to non-controlling interest

Net income attributable to Masonite

Basic earnings per common share attributable to Masonite

Diluted earnings per common share attributable to Masonite

$

$

$

Net sales

Cost of goods sold

Gross profit

Selling, general and administration expenses

Restructuring costs

Asset impairment

Operating income

Interest expense, net

Loss on extinguishment of debt

Other expense (income), net

Income before income tax expense

Income tax expense

Net income

Less: net income attributable to non-controlling interest

Net income attributable to Masonite

Basic earnings per common share attributable to Masonite

Diluted earnings per common share attributable to Masonite

$

$

$

94

420,192

111,045

76,752

2,681

—
9,655
21,957

12,096

—

4,363

5,498

2,624

2,874

1,272

1,602

0.06

0.06

$

$

$

426,588

125,604

77,573

1,994

—
—
46,037

11,909

14,523

(824)

20,429

4,334

16,095

1,126

14,969

0.60

0.59

$

$

$

434,013

128,930

78,142

1,361

3,142
—
46,285

11,357

—

(456)

35,384

10,293

25,091

849

24,242

0.96

0.96

$

$

$

432,989

95,361

61,601

1,624

5,243

26,893

11,027

—

(724)

16,590

3,067

13,523

1,176

12,347

0.47

0.46

$

$

$

446,306

110,842

64,530

—

—

46,312

10,151

5,414

(948)

31,695

6,151

25,544

748

24,796

0.90

0.89

$

$

$

443,052

123,674

71,851

—

—

51,823

9,074

—

(839)

43,588

7,894

35,694

953

34,741

1.26

1.24

$

$

$

530,311

418,207

112,104

78,100

3,740

10,625
4,605
15,034

11,127

—

(1,130)

5,037

58

4,979

1,190

3,789

0.15

0.15

517,879

412,450

105,429

68,211

—

—

37,218

8,756

—

(22)

28,484

6,701

21,783

957

20,826

0.74

0.73

Quarter Ended

December 30,
2018

September 30,
2018

July 1,
2018

April 1,
2018

$

528,350

$

557,148

$

566,726

$

 
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None.

Item 9A. Controls and Procedures

Disclosure Controls and Procedures 

We maintain disclosure controls and procedures as defined in Rule 13a-15(e) under the Exchange Act that are

designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed,
summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and 
forms and that such information is accumulated and communicated to management, including our Chief Executive
Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated 
the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on 
that evaluation, the Chief Executive Officer and the Chief Financial Officer have concluded that, as of the end of the 
period covered by this report, our disclosure controls and procedures were effective. 

Management's Annual Report on Internal Control Over Financial Reporting 

Management is responsible for establishing and maintaining adequate internal control over financial reporting

(as defined in Rule 13a-15(f) under the Exchange Act). Because of its inherent limitations, internal control over 
financial reporting may not prevent or detect misstatements. 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.

Under the supervision and with the participation of management, including our Chief Executive Officer and Chief 
Financial Officer, we carried out an evaluation of the effectiveness of our internal control over financial reporting as of 
December 29,  2019,  based  on  the  Internal  Control—Integrated  Framework  issued  by  the  Committee  of  Sponsoring
Organizations of the Treadway Commission in 2013. Based upon our evaluation, management concluded that our internal
control over financial reporting was effective as of December 29, 2019.

The effectiveness of our internal control over financial reporting as of December 29, 2019, has been audited by 
Ernst & Young, an independent registered public accounting firm, as stated in their report which is included herein, and 
which expresses an unqualified opinion on the effectiveness of our internal control over financial reporting as of 
December 29, 2019. See "Report of Independent Registered Public Accounting Firm" elsewhere in this Annual Report 
on Form 10-K.

Changes in Internal Control over Financial Reporting 

There have been no changes in our internal control over financial reporting during the most recently completed 

quarter covered by this Annual Report that have materially affected, or that are reasonably likely to materially affect, 
our internal control over financial reporting.

95

 
 
 
 
 
 
 
Report of Independent Registered Public Accounting Firm

To the Shareholders and the Board of Directors of Masonite International Corporation

Opinion on Internal Control Over Financial Reporting

We have audited Masonite International Corporation’s internal control over financial reporting as of December 29, 2019, based 
on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the
Treadway Commission (2013 framework) (the COSO criteria). In our opinion, Masonite International Corporation (the
Company) maintained, in all material respects, effective internal control over financial reporting as of December 29, 2019,
based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States)
(PCAOB), the consolidated balance sheets of Masonite International Corporation as of December 29, 2019 and December 30, 
2018, and the related consolidated statements of comprehensive income, changes in equity, and cash flows for each of the three 
years in the period ended December 29, 2019, and the related notes and our report dated February 20, 2020 expressed an 
unqualified opinion thereon. 

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 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/ Ernst & Young LLP

Tampa, Florida
February 20, 2020

96

Item 9B. Other Information

Annual Meeting and Record Date. The Board of Directors has set the date of the 2020 Annual General Meeting 

of Shareholders and the related record date. The Annual General Meeting will be held in Tampa, Florida, on May 14, 
2020, and the shareholders entitled to receive notice of and vote at the meeting will be the shareholders of record at the
close of business on March 16, 2020.

97

Item 10. Directors, Executive Officers and Corporate Governance

PART III

Some of the information required in response to this item with regard to directors is incorporated by reference 

into this Annual Report on Form 10-K from our definitive Proxy Statement for our 2020 Annual General Meeting of 
Shareholders (the "2020 Proxy Statement"). Such information will be included under the captions "Election of 
Directors," "Corporate Governance; Delinquent Section 16(a) Reports," "Corporate Governance; Board and Committee
Matters—Corporate Governance Guidelines and Code of Ethics," "Corporate Governance; Board and Committee 
Matters—Board Structure and Director Independence" and "Corporate Governance; Board and Committee Matters—
Board Committees; Membership—Audit Committee."

The following table sets forth information as of February 20, 2020, regarding each of our executive officers:

Name
Howard C. Heckes

Russell T. Tiejema
Randal A. White

James A. "Tony" Hair

Robert E. Lewis

Robert A. Paxton

Biographies

Age Positions
55

President and Chief Executive Officer and Director

51
49

53

59

46

Executive Vice President and Chief Financial Officer
Senior Vice President, Global Operations and Supply Chain

President, Global Residential

Senior Vice President, General Counsel and Secretary

Senior Vice President, Human Resources

The present principal occupations and recent employment history of each of the executive officers and 

directors listed above are as follows:

Howard C. Heckes, (age 55) has served as President and Chief Executive Officer of Masonite and as a 

Director of Masonite since June 2019. Mr. Heckes joined Masonite from Energy Management Collaborative where he 
served as Chief Executive Officer since 2017. From 2008 to 2017, Mr. Heckes served in a variety of operations roles at 
Valspar Corporation, now a subsidiary of The Sherwin-Williams Company, most recently overseeing Valspar's industrial
coatings portfolio. Prior to joining Valspar, Mr. Heckes held various leadership roles at Newell Rubbermaid, including
President of Sanford Brands and President of Graco Children's Products.

Russell T. Tiejema, (age 51) is Executive Vice President and Chief Financial Officer of Masonite. Mr. Tiejema

joined Masonite in November 2015, from Lennox International, a global leader in the heating, ventilation, air 
conditioning and refrigeration industry, where he served as the Vice President of Finance and Chief Financial Officer of 
LII Residential, the largest reporting segment of Lennox International, since 2013. From 2011 to 2013, Mr. Tiejema 
served as the Vice President, Business Analysis & Planning, of Lennox International. Prior to joining Lennox in 2011, 
Mr. Tiejema spent 20 years with General Motors in a variety of financial leadership roles across a number of operating
units and staffs, including Finance Director for GM Fleet & Commercial and Director of Financial Planning and 
Analysis.

Randal A. White, (age 49) joined Masonite in September 2017 as Senior Vice President, Global Operations 

and Supply Chain. Prior to joining Masonite, Mr. White was with Joy Global, Inc., a leading manufacturer of high 
productivity mining equipment now operating as Komatsu Mining, where he served in various operations and 
manufacturing roles since 2008, most recently serving as the Vice President Operations, Supply Chain, Quality and 
Operational Excellence (Lean) since 2014. Prior to joining Joy Global, Inc., Mr. White held various marketing and 
operational positions with Magnum Magnetics Inc. and Cooper Crouse-Hinds.

James A. "Tony" Hair, (age 53) joined Masonite in November 2013 as Vice President and Business Leader 

for the Residential Door Business and he has served most recently as President of the Global Residential Door Business. 
Prior to joining Masonite, Mr. Hair was with Newell Rubbermaid, a global manufacturer and marketer of consumer and 
commercial products, from 2005 to 2013, most recently serving as Senior Vice President and General Manager of the
Décor Business Unit. Mr. Hair also held executive leadership positions in the Home Solutions and Tools business 
groups. Prior to joining Newell Rubbermaid, Mr. Hair held various engineering, supply chain and sales positions with 
Maytag Corporation.

98

 
 
 
 
 
 
Robert E. Lewis, (age 59) has served as the Senior Vice President, General Counsel and Secretary of Masonite 
since April 2012. Mr. Lewis joined Masonite from Gerdau Ameristeel Corporation, a mini-mill steel producer, where he
served as Vice President, General Counsel and Corporate Secretary from January 2005 to May 2011. Prior to joining
Gerdau, Mr. Lewis served as Senior Vice President, General Counsel and Secretary of Eckerd Corporation, a national
retail drugstore chain from 1994 to January 2005. Prior to joining Eckerd, Mr. Lewis was an attorney and shareholder 
with the Tampa law firm of Shackleford, Farrior, Stallings & Evans, P.A.

Robert A. Paxton, (age 46) has served as Masonite’s Senior Vice President, Human Resources since February

2018. Prior to joining Masonite, Mr. Paxton was with Owens Corning, a global developer and producer of insulation, 
roofing and fiberglass composites, where he served as Vice President, Human Resources and Vice President, Business
Integration from May 2010 to February 2018. Prior to joining Owens Corning, he served as Senior Vice President, 
Human Resources of Broadwind Energy from 2008 to 2010. Prior to joining Broadwind, he served Whirlpool 
Corporation in various human resources leadership roles from 2002 to 2008, most recently serving as Vice President, 
Global Human Resources from 2007 to 2008. Mr. Paxton began his career with British Petroleum in 1995. 

Item 11. Executive Compensation 

Information required in response to this item is incorporated by reference into this Annual Report on Form 

10 K from the 2020 Proxy Statement. Such information will be included in the 2020 Proxy Statement under the
captions "Director Compensation", "Compensation Committee Report," "Executive Compensation" and "Corporate
Governance; Board and Committee Matters—Compensation Interlocks and Insider Participation."

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Information required in response to this item is incorporated by reference into this Annual Report on Form 

10 K from the 2020 Proxy Statement. Such information will be included in the 2020 Proxy Statement under the
captions "Security Ownership of Certain Beneficial Owners and Management" and "Securities Authorized for Issuance 
Under Equity Compensation Plans".

Item 13. Certain Relationships and Related Transactions, and Director Independence 

Information required in response to this item is incorporated by reference into this Annual Report on Form 
10 K from the 2020 Proxy Statement. Such information will be included under the captions "Corporate Governance; 
Board and Committee Matters—Board Structure and Director Independence", "Corporate Governance; Board and 
Committee Matters—Board Committees; Membership" and "Certain Relationships and Related Party Transactions".

Item 14. Principal Accountant Fees and Services 

Information required in response to this item is incorporated by reference into this Annual Report on Form 

10 K from the 2020 Proxy Statement. Such information will be included under the caption "Appointment of 
Independent Registered Public Accounting Firm".

99

 
 
 
 
 
Item 15. Exhibits and Financial Statement Schedules

PART IV

(a) The following documents are filed as part of this Form 10-K:

Page No.

1. Consolidated Financial Statements:

Report of Independent Registered Public Accounting Firm

Consolidated Statements of Comprehensive Income

Consolidated Balance Sheets

Consolidated Statements of Changes in Equity

Consolidated Statements of Cash Flows

Notes to the Consolidated Financial Statements

2. Financial Statement Schedules

46

48

49

50

51

52

All schedules have been omitted because they are not required, not applicable, not present in
amounts sufficient to require submission of the schedule or the required information is otherwise
included.

3. See “Index to Exhibits” below.

(b)

incorporated by reference as set forth below.

(c) Additional Financial Statement Schedules

None.

The following is a list of all exhibits filed or furnished as part of this report:

INDEX TO EXHIBITS

Exhibit No. Descriptionp
3.1

Amended and Restated Articles of Masonite International Corporation (incorporated by reference to
Exhibit 3.1 to the Company's Annual Report on Form 10-K (File No. 001-11796) filed with the
Securities and Exchange Commission on February 26, 2015)

4.1

4.2

4.3

4.4

4.5*

10.1 #

10.2 #

Indenture, dated as of July 25, 2019, by and among the Company, the guarantors named therein and
Wells Fargo Bank, National Association, as trustee, governing the 5.375% Senior Notes due 2028.
(incorporated by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K (File No.
001-11796) filed with the Securities and Exchange Commission on July 25, 2019)

Indenture, dated as of August 27, 2018, by and among the Company, the guarantors named therein and
Wells Fargo Bank, National Association, as trustee, governing the 5.75% Senior Notes due 2026
(incorporated by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K (File No.
001-11796) filed with the Securities and Exchange Commission on August 27, 2018)

Transfer Agency and Registrar Services, dated July 1, 2013, between Masonite International
Corporation and American Stock Transfer & Trust Company, LLC of New York (incorporated by
reference to Exhibit 4.3(e) to the Company's Annual Report on Form 10-K (File No. 001-11796) filed
with the Securities and Exchange Commission on February 27, 2014)
Form of Second Amended and Restated Shareholders Agreement (Incorporated by reference to Exhibit
3.2 to the Company's Current Report on Form 8-K (File No. 001-11796) filed with the Securities and
Exchange Commission on May 15, 2014)

Description of Securities

Masonite International Corporation 2014 Employee Stock Purchase Plan (incorporated by reference to
Exhibit 10.2 to the Company's Current Report on Form 8-K (File No. 001-11796) filed with the
Securities and Exchange Commission on May 15, 2014)

Masonite International Corporation Deferred Compensation Plan, effective as of August 13, 2012
(incorporated by reference to Exhibit 10.2 to the Company's Registration Statement on Form 10 (File
No. 001-11796) filed with the Securities and Exchange Commission on August 19, 2013)

10.3(a) #

Masonite International Corporation Amended and Restated 2012 Equity Incentive Plan (incorporated by
reference to Exhibit 10.2 to the Company's Current Report on Form 8-K (File No. 011-11796) filed with
the Securities and Exchange Commission on May 18, 2015)

100

 
Exhibit No. Descriptionp
10.3(b) #

Form of Restricted Stock Unit Agreement pursuant to the Masonite International Corporation 2012
Equity Incentive Plan for United States Directors (incorporated by reference to Exhibit 10.3(b) to the
Company's Registration Statement on Form 10 (File No. 001-11796) filed with the Securities and
Exchange Commission on August 19, 2013)

10.3(c) #

10.3(d) #

10.3(e) #

10.3(f) #

10.3(g) #

10.3(h) #

10.3(i) #

10.3(j) #

10.3(k) #

10.3(l) #

10.3(m) #

10.3(n) #

10.3(o) #

Form of Restricted Stock Unit Agreement pursuant to the Masonite International Corporation 2012
Equity Incentive Plan for United States Employees (incorporated by reference to Exhibit 10.3(c) to the
Company's Registration Statement on Form 10 (File No. 001-11796) filed with the Securities and
Exchange Commission on August 19, 2013)
Form of Stock Appreciation Rights Agreement pursuant to the Masonite International Corporation 2012
Equity Incentive Plan for United States Employees (incorporated by reference to Exhibit 10.3(d) to the
Company's Registration Statement on Form 10 (File No. 001-11796) filed with the Securities and
Exchange Commission on August 19, 2013)

Form of Amendment to Restricted Stock Unit Agreement pursuant to the Masonite International
Corporation 2012 Equity Incentive Plan (incorporated by reference to Exhibit 10.3(e) to the Company's
Registration Statement on Form 10 (File No. 001-11796) filed with the Securities and Exchange
Commission on August 19, 2013)
Form of Restricted Stock Unit Agreement pursuant to the Masonite International Corporation 2012
Equity Incentive Plan for United States Directors (incorporated by reference to Exhibit 10.3(h) to the
Company's Quarterly Report on Form 10-Q (File No. 001-11796) filed with the Securities and
Exchange Commission on November 6, 2013)

Form of Restricted Stock Unit Agreement pursuant to the Masonite International Corporation 2012
Equity Incentive Plan for United States employees (incorporated by reference to Exhibit 10.3(b) to the
Company's Quarterly Report on Form 10-Q (File No. 001-11796) filed with the Securities and
Exchange Commission on May 8, 2014)

Form of Performance Restricted Stock Unit Agreement pursuant to the Masonite International
Corporation 2012 Equity Incentive Plan (incorporated by reference to Exhibit 10.3(f) to the Company's
Quarterly Report on Form 10-Q (File No. 001-11796) filed with the Securities and Exchange
Commission on May 8, 2014)

Form of Restricted Stock Unit Agreement Pursuant to the Masonite International Corporation 2012
Equity Incentive Plan for United States Employees (incorporated by reference to Exhibit 10.3(k) to the
Company's Annual Report on Form 10-K (File No. 001-11796) filed with the Securities and Exchange
Commission on February 26, 2015)

Form of Performance Restricted Stock Unit Agreement Pursuant to the Masonite International
Corporation 2012 Equity Incentive Plan for United States employees (incorporated by reference to
Exhibit 10.3(l) to the Company's Annual Report on Form 10-K (File No. 001-11796) filed with the
Securities and Exchange Commission on February 26, 2015)

Form of Restricted Stock Unit Agreement pursuant to the Masonite International Corporation Amended
and Restated 2012 Equity Incentive Plan for United States Directors (2015) (incorporated by reference
to Exhibit 10.3(m) to the Company's Annual Report on Form 10-K (File No. 001-11796) filed with the
Securities and Exchange Commission on March 2, 2016)

Form of Restricted Stock Unit Agreement pursuant to the Masonite International Corporation Amended
and Restated 2012 Equity Incentive Plan for United States Employees (November 2015) (incorporated
by reference to Exhibit 10.3(n) to the Company's Annual Report on Form 10-K (File No. 001-11796)
filed with the Securities and Exchange Commission on March 2, 2016)

Form of Restricted Stock Unit Agreement pursuant to the Masonite International Corporation Amended
and Restated 2012 Equity Incentive Plan for United States Employees (December 2015) (incorporated
by reference to Exhibit 10.3(o) to the Company's Annual Report on Form 10-K (File No. 001-11796)
filed with the Securities and Exchange Commission on March 2, 2016)

Form of Performance Restricted Stock Unit Agreement pursuant to the Masonite International
Corporation Amended and Restated 2012 Equity Incentive Plan for United States Employees (February
2016) (incorporated by reference to Exhibit 10.3(p) to the Company's Annual Report on Form 10-K
(File No. 001-11796) filed with the Securities and Exchange Commission on March 2, 2016)

Form of Stock Appreciation Rights Agreement pursuant to the Masonite International Corporation
Amended and Restated 2012 Equity Incentive Plan for United States Employees (February 2016)
(incorporated by reference to Exhibit 10.3(q) to the Company's Annual Report on Form 10-K (File No.
001-11796) filed with the Securities and Exchange Commission on March 2, 2016)

101

Exhibit No. Descriptionp
10.3(p) #

Form of Restricted Stock Unit Agreement pursuant to the Masonite International Corporation Amended
and Restated 2012 Equity Incentive Plan for United States Employees (February 2016) (incorporated by
reference to Exhibit 10.3(r) to the Company's Annual Report on Form 10-K (File No. 001-11796) filed
with the Securities and Exchange Commission on March 2, 2016)

10.3(q) #

10.3(r) #

10.3(s) #

10.3(t) #

10.3(u) #

10.3(v) #

10.3(w) #

10.3(x) #

10.4(a) #

10.4(b) #

10.4(c) #

10.4(d) #

10.4(e) #

Amendment No. 1 to Masonite International Corporation Amended and Restated 2012 Equity Incentive
Plan dated February 7, 2017 (incorporated by reference to Exhibit 10.3(s) to the Company's Annual
Report on Form 10-K (File No. 001-11796) filed with the Securities and Exchange Commission on
March 1, 2017)

Form of Performance Restricted Stock Unit Agreement pursuant to the Masonite International
Corporation Amended and Restated 2012 Equity Incentive Plan for United States Employees (February
2017) (incorporated by reference to Exhibit 10.3(t) to the Company's Annual Report on Form 10-K (File
No. 001-11796) filed with the Securities and Exchange Commission on March 1, 2017)

Form of Stock Appreciation Rights Agreement pursuant to the Masonite International Corporation
Amended and Restated 2012 Equity Incentive Plan for United States Employees (February 2017)
(incorporated by reference to Exhibit 10.3(u) to the Company's Annual Report on Form 10-K (File No.
001-11796) filed with the Securities and Exchange Commission on March 1, 2017)
Form of Restricted Stock Unit Agreement pursuant to the Masonite International Corporation Amended
and Restated 2012 Equity Incentive Plan for United States Employees (February 2017) (incorporated by
reference to Exhibit 10.3(v) to the Company's Annual Report on Form 10-K (File No. 001-11796) filed
with the Securities and Exchange Commission on March 1, 2017)

Form of Stock Appreciation Rights Agreement pursuant to the Masonite International Corporation
Amended and Restated 2012 Equity Incentive Plan for United States Employees (February 2019)
(incorporated by reference to Exhibit 10.3(v) to the Company's Annual Report on Form 10-K (File No.
001-11796) filed with the Securities and Exchange Commission on February 26, 2019)

Form of Restricted Stock Unit Agreement pursuant to the Masonite International Corporation Amended
and Restated 2012 Equity Incentive Plan for United States Employees (February 2019) (incorporated by
reference to Exhibit 10.3(w) to the Company's Annual Report on Form 10-K (File No. 001-11796) filed
with the Securities and Exchange Commission on February 26, 2019)

Form of Performance Restricted Stock Unit Agreement pursuant to the Masonite International
Corporation Amended and Restated 2012 Equity Incentive Plan for United States Employees (February
2019) (incorporated by reference to Exhibit 10.3(x) to the Company's Annual Report on Form 10-K
(File No. 001-11796) filed with the Securities and Exchange Commission on February 26, 2019)

Restricted Stock Unit Agreement pursuant to the Masonite International Corporation Amended and
Restated 2012 Equity Incentive Plan, dated as of May 24, 2019, by and between Masonite International
Corporation and James A. Hair (incorporated by reference to Exhibit 10.1 to the Company’s Current
Report on Form 8-K (File No. 001-11796) filed with the Securities and Exchange Commission on May
24, 2019)

Masonite Worldwide Holdings Inc. 2009 Equity Incentive Plan (incorporated by reference to Exhibit
10.4(a) to the Company's Registration Statement on Form 10 (File No. 001-11796) filed with the
Securities and Exchange Commission on August 19, 2013)

Form of Restricted Stock Unit Agreement Pursuant to the Masonite Worldwide Holdings Inc. 2009
Equity Incentive Plan for Directors (incorporated by reference to Exhibit 10.4(b) to the Company's
Registration Statement on Form 10 (File No. 001-11796) filed with the Securities and Exchange
Commission on August 19, 2013)

Form of Restricted Stock Unit Agreement Pursuant to the Masonite Worldwide Holdings Inc. 2009
Equity Incentive Plan (incorporated by reference to Exhibit 10.4(c) to the Company's Registration
Statement on Form 10 (File No. 001-11796) filed with the Securities and Exchange Commission on
August 19, 2013)

Form of Stock Appreciation Rights Agreement Pursuant to the Masonite Worldwide Holdings Inc. 2009
Equity Incentive Plan (incorporated by reference to Exhibit 10.4(d) to the Company's Registration
Statement on Form 10 (File No. 001-11796) filed with the Securities and Exchange Commission on
August 19, 2013)

Form of Restricted Stock Unit Agreement Pursuant to the Masonite Worldwide Holdings Inc. 2009
Equity Incentive Plan for United States Executives (incorporated by reference to Exhibit 10.4(e) to the
Company's Registration Statement on Form 10 (File No. 001-11796) filed with the Securities and
Exchange Commission on August 19, 2013)

102

Exhibit No. Descriptionp
10.4(f) #

Form of Stock Appreciation Rights Agreement Pursuant to the Masonite Worldwide Holdings Inc. 2009
Equity Incentive Plan for United States Executives (incorporated by reference to Exhibit 10.4(f) to the
Company's Registration Statement on Form 10 (File No. 001-11796) filed with the Securities and
Exchange Commission on August 19, 2013)

10.4(g) #

10.4(h) #

10.4(i) #

10.4(j) #

10.4(k) #

10.4(l) #

10.4(m) #

10.4(n) #

10.5(a) #

10.5(b) #

10.5(c) #

10.5(d) #

10.5(e) #

Form of Restricted Stock Unit Agreement Pursuant to the Masonite Worldwide Holdings Inc. 2009
Equity Incentive Plan (2011 Grant) (incorporated by reference to Exhibit 10.4(g) to the Company's
Registration Statement on Form 10 (File No. 001-11796) filed with the Securities and Exchange
Commission on August 19, 2013)

Form of Stock Appreciation Rights Agreement Pursuant to the Masonite Worldwide Holdings Inc. 2009
Equity Incentive Plan (2011 Grant) (incorporated by reference to Exhibit 10.4(h) to the Company's
Registration Statement on Form 10 (File No. 001-11796) filed with the Securities and Exchange
Commission on August 19, 2013)

Form of Performance Restricted Stock Unit Agreement Pursuant to the Masonite Worldwide Holdings
Inc. 2009 Equity Incentive Plan (2011 Grant) (incorporated by reference to Exhibit 10.4(i) to the
Company's Registration Statement on Form 10 (File No. 001-11796) filed with the Securities and
Exchange Commission on August 19, 2013)
Form of Restricted Stock Unit Agreement Pursuant to the Masonite Worldwide Holdings Inc. 2009
Equity Incentive Plan for United States Executives (Exchange Agreement) (incorporated by reference to
Exhibit 10.4(j) to the Company's Registration Statement on Form 10 (File No. 001-11796) filed with the
Securities and Exchange Commission on August 19, 2013)

Form of Stock Appreciation Rights Agreement Pursuant to the Masonite Worldwide Holdings Inc. 2009
Equity Incentive Plan for United States Executives (Exchange Agreement) (incorporated by reference to
Exhibit 10.4(k) to the Company's Registration Statement on Form 10 (File No. 001-11796) filed with
the Securities and Exchange Commission on August 19, 2013)

Form of Amendment to Restricted Stock Unit Agreement Pursuant to the Masonite Worldwide Holdings
Inc. 2009 Equity Incentive Plan (incorporated by reference to Exhibit 10.4(l) to the Company's
Registration Statement on Form 10 (File No. 001-11796) filed with the Securities and Exchange
Commission on August 19, 2013)

Amendment No. 1 to Masonite Worldwide Holdings Inc. 2009 Equity Incentive Plan dated February 7,
2017 (incorporated by reference to Exhibit 10.4(m) to the Company's Annual Report on Form 10-K
(File No. 001-11796) filed with the Securities and Exchange Commission on March 1, 2017)

Omnibus Amendment to Masonite International Corporation Restricted Stock Unit Agreements,
Performance Restricted Stock Unit Agreement, and Stock Appreciation Rights Agreements, dated as of
May 14, 2019, by and between Masonite International Corporation and Frederick J. Lynch
(incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K (File No.
001-11796) filed with the Securities and Exchange Commission on May 17, 2019)

Amended and Restated Employment Agreement, dated as of December 31, 2018, by and between
Masonite International Corporation and Frederick J. Lynch (incorporated by reference to Exhibit 10.1 to
the Company's Current Report on Form 8-K (File No. 011-11796) filed with the Securities and
Exchange Commission on December 31, 2018)

Amended and Restated Employment Agreement, dated as of December 31, 2018, by and between
Masonite International Corporation and Russell T. Tiejema (incorporated by reference to Exhibit 10.4 to
the Company's Current Report on Form 8-K (File No. 011-11796) filed with the Securities and
Exchange Commission on December 31, 2018)

Amended and Restated Employment Agreement, dated as of December 31, 2018, by and between
Masonite International Corporation and James A. Hair (incorporated by reference to Exhibit 10.2 to the
Company's Current Report on Form 8-K (File No. 011-11796) filed with the Securities and Exchange
Commission on December 31, 2018)

Amended and Restated Employment Agreement, dated as of December 31, 2018, by and between
Masonite International Corporation and Randal A. White (incorporated by reference to Exhibit 10.5(c)
to the Company's Annual Report on Form 10-K (File No. 001-11796) filed with the Securities and
Exchange Commission on February 26, 2019)

Amended and Restated Employment Agreement, dated as of December 31, 2018, by and between
Masonite International Corporation and Robert A. Paxton (incorporated by reference to Exhibit 10.5(e)
to the Company's Annual Report on Form 10-K (File No. 001-11796) filed with the Securities and
Exchange Commission on February 26, 2019)

103

Exhibit No. Descriptionp
10.5(f) #

Employment Agreement, dated as of May 1, 2019, by and between Masonite International Corporation
and Howard C. Heckes (incorporated by reference to Exhibit 10.1 to the Company's Quarterly Report
on Form 10-Q (File No. 001-11796) filed with the Securities and Exchange Commission on August 6,
2019)

10.5(g) #

10.6 #

10.7(a)

10.7(b)

10.7(c)

10.7(d)

10.7(e)

10.7(f)

21.1*

23.1*

31.1*

31.2*

32.1*

32.2*

Consulting Agreement, dated as of May 14, 2019, by and between Masonite International Corporation
and Frederick J. Lynch (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on
Form 8-K (File No. 001-11796) filed with the Securities and Exchange Commission on May 17, 2019)

Form of Director and Officer Indemnification Agreement (incorporated by reference to Exhibit 10.6 to
the Company's Registration Statement on Form 10 (File No. 001-11796) filed with the Securities and
Exchange Commission on August 19, 2013)

Second Amended and Restated Credit Agreement, dated as of January 31, 2019, among Masonite
International Corporation, as Canadian borrower and parent borrower, Masonite Corporation and the
other U.S. borrowers from time to time party thereto, as U.S. borrowers, Premdor Crosby Limited and
the other U.K. borrowers from time to time party thereto, as U.K. Borrowers, the lenders from time to
time party thereto, Wells Fargo Bank, National Association, as administrative agent and letter of credit
issuer, Bank of America, N.A., as a syndication agent, and Royal Bank of Canada, HSBC Bank USA,
National Association, JPMorgan Chase Bank, N.A., PNC Bank, National Association, Regions Bank
and TD Bank, N.A., as co-documentation agents, Wells Fargo Bank, National Association, Bank of
America, N.A., Royal Bank of Canada, and HSBC Bank USA, National Association, as joint lead
arrangers and joint lead bookrunners (incorporated by reference to Exhibit 4.1 to the Company's Current
Report on Form 8-K (File No. 011-11796) filed with the Securities and Exchange Commission on
February 6, 2019)

Amended and Restated U.S. Security Agreement, dated as of January 31, 2019, among Masonite
Corporation, the other U.S. Borrowers from time to time party thereto and Wells, the U.S. Guarantors
from time to time party thereto, and Wells Fargo Bank, National Association, as Collateral Agent
(incorporated by reference to Exhibit 4.2 to the Company's Current Report on Form 8-K (File No.
011-11796) filed with the Securities and Exchange Commission on February 6, 2019)

Amended and Restated Canadian Security Agreement, dated as of January 31, 2019, among Masonite
International Corporation, as Canadian Borrower and the Canadian Subsidiary Guarantors from time to
time party thereto and Wells Fargo Bank, National Association, as Collateral Agent (incorporated by
reference to Exhibit 4.3 to the Company's Current Report on Form 8-K (File No. 011-11796) filed with
the Securities and Exchange Commission on February 6, 2019)

Amended and Restated U.S. Guaranty, dated as of January 31, 2019, among Masonite Corporation, the
other U.S. Borrowers from time to time party thereto, the U.S. Subsidiary Guarantors from time to time
party thereto, and Wells Fargo Bank, National Association, as Administrative Agent (incorporated by
reference to Exhibit 4.4 to the Company's Current Report on Form 8-K (File No. 011-11796) filed with
the Securities and Exchange Commission on February 6, 2019)

Amended and Restated Canadian Guarantee, dated as of January 31, 2019, among Masonite
International Corporation and the Canadian Subsidiary Guarantors from time to time party thereto and
Wells Fargo Bank, National Association, as Administrative Agent (incorporated by reference to Exhibit
4.5 to the Company's Current Report on Form 8-K (File No. 011-11796) filed with the Securities and
Exchange Commission on February 6, 2019)
Guarantee and Debenture, dated as of January 31, 2019, among Premdor Crosby Limited (and others as
Chargors) and Wells Fargo Bank, National Association (as Agent) (incorporated by reference to Exhibit
4.6 to the Company's Current Report on Form 8-K (File No. 011-11796) filed with the Securities and
Exchange Commission on February 6, 2019)

Subsidiaries of the Registrant

Consent of Ernst & Young LLP, an Independent Registered Public Accounting Firm

Certification of Periodic Report by Chief Executive Officer under Section 302 of the Sarbanes-Oxley
Act of 2002

Certification of Periodic Report by Chief Financial Officer under Section 302 of the Sarbanes-Oxley
Act of 2002

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

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

104

Exhibit No. Descriptionp
101*

Interactive Data Files pursuant to Rule 405 of Regulation S-T formatted in Inline Extensible Business
Reporting Language ("Inline XBRL"): (i) the Registrant's Consolidated Statements of Comprehensive
Income for the years ended December 29, 2019, December 30, 2018, and December 31, 2017; (ii) the
Registrant's Consolidated Balance Sheets as of December 29, 2019, and December 30, 2018; (iii) the
Registrant's Consolidated Statements of Changes in Equity for the years ended December 29, 2019,
December 30, 2018, and December 31, 2017; (iv) the Registrant's Consolidated Statements of Cash
Flows for the years ended December 29, 2019, and December 30, 2018; and (v) the notes to the
Registrant's Consolidated Financial Statements

104*

Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

*

#

Filed herewith.

Denotes management contract or compensatory plan.

Item 16. Form 10-K Summary

None.

105

 
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.

SIGNATURES

Date: February 20, 2020

MASONITE INTERNATIONAL CORPORATION

(Registrant)

By /s/ Russell T. Tiejema

Russell T. Tiejema

Executive Vice President and Chief Financial Officer

(Principal Financial Officer and Principal Accounting Officer)

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the

following persons on behalf of the registrant in the capacities and on the dates indicated. 

Signatures

g

/s/ Howard C. Heckes
Howard C. Heckes

/s/ Russell T. Tiejema
Russell T. Tiejema

/s/ Robert J. Byrne
Robert J. Byrne

/s/ Jody L. Bilney
Jody L. Bilney

/s/ Peter R. Dachowski
Peter R. Dachowski

/s/ Jonathan F. Foster
Jonathan F. Foster

/s/ Thomas W. Greene
Thomas W. Greene

/s/ Daphne E. Jones
Daphne E. Jones

/s/ George A. Lorch
George A. Lorch

/s/ William S. Oesterle
William S. Oesterle

/s/ Francis M. Scricco
Francis M. Scricco

Title

Date

President and Chief Executive Officer and Director

February 20, 2020

(Principal Executive Officer)

Executive Vice President and Chief Financial Officer

February 20, 2020

(Principal Financial Officer and Principal Accounting Officer)

Director and Chairman of the Board

February 20, 2020

Director

Director

Director

Director

Director

Director

Director

Director

February 20, 2020

February 20, 2020

February 20, 2020

February 20, 2020

February 20, 2020

February 20, 2020

February 20, 2020

February 20, 2020

 
 
[THIS PAGE INTENTIONALLY LEFT BLANK]

[THIS PAGE INTENTIONALLY LEFT BLANK]

Forward-looking Statements  

This  annual  report,  including  the  letter  to  shareholders  contained  herein,  includes  forward-looking 
statements within the meaning of the federal securities laws, all of which are subject to risks and uncertainties. One 
can  identify  these  forward-looking  statements  by  their  use  of  words  such  as  “may,”  “might,”  “could,”  “will,” 
“would,” “should,” “expect,” “believes,” “outlook,” “predict,” “forecast,” “objective,” “remain,” “anticipate,” 
“estimate,”  “potential,”  “continue,”  “plan,”  “project,”  “targeting,”  or  the  negative  of  these  terms  or  other 
similar terminology. Forward-looking statements involve significant known and unknown risks, uncertainties and 
other factors that may cause the actual results, performance or achievements of Masonite, or industry results, to be 
materially  different  from  any  future  plans,  goals,  targets,  objectives,  results,  performance  or  achievements 
expressed or implied by such forward-looking statements. As a result, such forward-looking statements should not 
be read as guarantees of future performance or results, should not be unduly relied upon, and will not necessarily 
be accurate indications of whether or not such results will be achieved. Factors that could cause actual results to 
differ  materially  from  the  results  discussed  in  the  forward-looking  statements  include,  but  are  not  limited  to, 
downward trends in our end markets and in economic conditions; reduced levels of residential new construction; 
residential repair, renovation and remodeling; and non-residential building construction activity due to increases 
in  mortgage  rates,  changes  in  mortgage  interest  deductions  and  related  tax  changes  and  reduced  availability  of 
financing;  competition;  the  continued  success  of,  and  our  ability  to  maintain  relationships  with,  certain  key 
customers  in  light  of  price  increases  and  customer  concentration  and  consolidation;  tariffs  and  evolving  trade 
policy and friction between the United States and other countries, including China; the impact of anti-dumping and 
countervailing trade cases; increases in prices of raw materials and fuel; increases in labor costs, the availability 
of  labor,  or  labor  relations  (i.e.,  disruptions,  strikes  or  work  stoppages);  our  ability  to  manage  our  operations 
including anticipating demand for our products, managing disruptions in our operations, managing manufacturing 
realignments (including related restructuring charges), managing customer credit risk and successful integration 
of acquisitions; the continuous operation of our information technology and enterprise resource planning systems 
and  management  of  potential  cyber  security  threats  and  attacks;  our  ability  to  generate  sufficient  cash  flows  to 
fund  our  capital  expenditure  requirements,  to  meet  our  pension  obligations,  and  to  meet  our  debt  service 
obligations, including our obligations under our senior notes and our ABL Facility; political, economic and other 
risks that arise from operating a multinational business; uncertainty relating to the United Kingdom's exit from the 
European Union; fluctuating exchange and interest rates; our ability to innovate and keep pace with technological 
developments; product liability claims and product recalls; retention of key management personnel; limitations on 
operating our business as a result of  covenant restrictions under our existing and future indebtedness, including 
our senior notes and our ABL Facility; and environmental and other government regulations, including the FCPA, 
and  any  changes  in  such  regulations;  and  other  factors  publicly  disclosed  by  the  Company  from  time  to  time 
(including those discussed in our Annual Report on Form 10-K and Quarterly Reports on Form 10-Q (available 
through the Investors section of our website at www.masonite.com) under the sections entitled “Risk Factors.” No 
forward-looking statement can be guaranteed and actual future results may vary materially. Therefore, we caution 
you not to place undue reliance on our forward-looking statements. The Company disclaims any responsibility to 
update these forward-looking statements, whether as a result of new information, future events or otherwise unless 
required by applicable law.  

 
 
CORPORATE INFORMATION(cid:3)

Corporate Office
(cid:21)(cid:26)(cid:26)(cid:20)(cid:3)(cid:53)(cid:88)(cid:87)(cid:75)(cid:72)(cid:85)(cid:73)(cid:82)(cid:85)(cid:71)(cid:3)(cid:53)(cid:82)(cid:68)(cid:71)
(cid:38)(cid:82)(cid:81)(cid:70)(cid:82)(cid:85)(cid:71)(cid:15)(cid:3)(cid:50)(cid:81)(cid:87)(cid:68)(cid:85)(cid:76)(cid:82)(cid:3)(cid:47)(cid:23)(cid:46)(cid:3)(cid:21)(cid:49)(cid:25)(cid:3)(cid:38)(cid:68)(cid:81)(cid:68)(cid:71)(cid:68)

Website
(cid:90)(cid:90)(cid:90)(cid:17)(cid:80)(cid:68)(cid:86)(cid:82)(cid:81)(cid:76)(cid:87)(cid:72)(cid:17)(cid:70)(cid:82)(cid:80) (cid:3)(cid:80)

Legal Counsel
(cid:38)(cid:68)(cid:86)(cid:86)(cid:72)(cid:79)(cid:86)(cid:3)(cid:37)(cid:85)(cid:82)(cid:70)(cid:78)(cid:3)(cid:47)(cid:68)(cid:90)(cid:92)(cid:72)(cid:85)(cid:86)
(cid:54)(cid:76)(cid:80)(cid:83)(cid:86)(cid:82)(cid:81)(cid:3)(cid:55)(cid:75)(cid:68)(cid:87)(cid:70)(cid:75)(cid:72)(cid:85)(cid:3)(cid:9)(cid:3)(cid:37)(cid:68)(cid:85)(cid:87)(cid:79)(cid:72)(cid:87)(cid:87)(cid:3)(cid:47)(cid:47)(cid:51)

Investor Contact
(cid:45)(cid:82)(cid:68)(cid:81)(cid:81)(cid:72)(cid:3)(cid:41)(cid:85)(cid:72)(cid:76)(cid:69)(cid:72)(cid:85)(cid:74)(cid:72)(cid:85)(cid:15)(cid:3)(cid:38)(cid:51)(cid:36)(cid:15)(cid:3)(cid:38)(cid:55)(cid:51)(cid:15)(cid:3)(cid:44)(cid:53)(cid:38)
(cid:87)
(cid:57)(cid:76)(cid:70)(cid:72)(cid:3)(cid:51)(cid:85)(cid:72)(cid:86)(cid:76)(cid:71)(cid:72)(cid:81)(cid:87) (cid:68)(cid:81)(cid:71)(cid:3)(cid:55)(cid:85)(cid:72)(cid:68)(cid:86)(cid:88)(cid:85)(cid:72)(cid:85)(cid:3)

(cid:41)(cid:68)(cid:85)(cid:68)(cid:81)(cid:71)(cid:3)(cid:51)(cid:68)(cid:90)(cid:79)(cid:68)(cid:78)(cid:15)(cid:3)(cid:38)(cid:51)(cid:36)(cid:3)(cid:3)
(cid:39)(cid:76)(cid:85)(cid:72)(cid:70)(cid:87)(cid:82)(cid:85)(cid:3)(cid:82)(cid:73)(cid:3)(cid:44)(cid:81)(cid:89)(cid:72)(cid:86)(cid:87)(cid:82)(cid:85)(cid:3)(cid:53)(cid:72)(cid:79)(cid:68)(cid:87)(cid:76)(cid:82)(cid:81)(cid:86)

(cid:21)(cid:19)(cid:20)(cid:3)(cid:49)(cid:82)(cid:85)(cid:87)(cid:75)(cid:3)(cid:41)(cid:85)(cid:68)(cid:81)(cid:78)(cid:79)(cid:76)(cid:81)(cid:3)(cid:54)(cid:87)(cid:85)(cid:72)(cid:72)(cid:87)(cid:3)
(cid:54)(cid:88)(cid:76)(cid:87)(cid:72)(cid:3)(cid:22)(cid:19)(cid:19)
(cid:55)(cid:68)(cid:80)(cid:83)(cid:68)(cid:15)(cid:3)(cid:41)(cid:79)(cid:82)(cid:85)(cid:76)(cid:71)(cid:68)(cid:3)(cid:22)(cid:22)(cid:25)(cid:19)(cid:21)
(cid:55)(cid:72)(cid:79)(cid:72)(cid:83)(cid:75)(cid:82)(cid:81)(cid:72)(cid:29)(cid:3)(cid:11)(cid:27)(cid:20)(cid:22)(cid:12)(cid:3)(cid:27)(cid:26)(cid:26)(cid:16)(cid:21)(cid:26)(cid:21)(cid:25)(cid:3)
(cid:40)(cid:80)(cid:68)(cid:76)(cid:79)(cid:29) (cid:76)(cid:81)(cid:89)(cid:72)(cid:86)(cid:87)(cid:82)(cid:85)(cid:85)(cid:72)(cid:79)(cid:68)(cid:87)(cid:76)(cid:82)(cid:81)(cid:86)(cid:35)(cid:80)(cid:68)(cid:86)(cid:82)(cid:81)(cid:76)(cid:87)(cid:72)(cid:17)(cid:70)(cid:82)(cid:80)(cid:3)

Independent Auditors
(cid:40)(cid:85)(cid:81)(cid:86)(cid:87)(cid:3)(cid:9)(cid:3)(cid:60)(cid:82)(cid:88)(cid:81)(cid:74)

Stock Symbol
(cid:49)(cid:60)(cid:54)(cid:40)(cid:29)(cid:3)(cid:39)(cid:50)(cid:50)(cid:53)

Transfer Agent
(cid:36)(cid:80)(cid:72)(cid:85)(cid:76)(cid:70)(cid:68)(cid:81)(cid:3)(cid:54)(cid:87)(cid:82)(cid:70)(cid:78)(cid:3)(cid:55)(cid:85)(cid:68)(cid:81)(cid:86)(cid:73)(cid:72)(cid:85)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:55)(cid:85)(cid:88)(cid:86)(cid:87)(cid:3)(cid:38)(cid:82)(cid:80)(cid:83)(cid:68)(cid:81)(cid:92)(cid:15)(cid:3)(cid:47)(cid:47)(cid:38)(cid:3)
(cid:25)(cid:21)(cid:19)(cid:20)(cid:3)(cid:20)(cid:24)(cid:87)(cid:75)(cid:3)(cid:36)(cid:89)(cid:72)(cid:81)(cid:88)(cid:72)(cid:3)
(cid:75)
(cid:37)(cid:85)(cid:82)(cid:82)(cid:78)(cid:79)(cid:92)(cid:81)(cid:15)(cid:3)(cid:49)(cid:60)(cid:3)(cid:20)(cid:20)(cid:21)(cid:20)(cid:28)
(cid:55)(cid:82)(cid:79)(cid:79)(cid:3)(cid:41)(cid:85)(cid:72)(cid:72)(cid:6)(cid:3)(cid:11)(cid:27)(cid:19)(cid:19)(cid:12)(cid:3)(cid:28)(cid:22)(cid:26)(cid:16)(cid:24)(cid:23)(cid:23)(cid:28)(cid:3)
(cid:41)(cid:82)(cid:85)(cid:72)(cid:76)(cid:74)(cid:81)(cid:3)(cid:43)(cid:82)(cid:79)(cid:71)(cid:72)(cid:85)(cid:86)(cid:29)(cid:3)(cid:11)(cid:26)(cid:20)(cid:27)(cid:12)(cid:3)(cid:28)(cid:21)(cid:20)(cid:16)(cid:27)(cid:20)(cid:21)(cid:23)(cid:3)
(cid:90)(cid:90)(cid:90)(cid:17)(cid:68)(cid:80)(cid:86)(cid:87)(cid:82)(cid:70)(cid:78)(cid:17)(cid:70)(cid:82)(cid:80)(cid:80)

Quarterly Earnings, News Summaries,
Copies of News Releases and Corporate
Publications
(cid:44)(cid:81)(cid:89)(cid:72)(cid:86)(cid:87)(cid:82)(cid:85)(cid:17)(cid:80)(cid:68)(cid:86)(cid:82)(cid:81)(cid:76)(cid:87)(cid:72)(cid:17)(cid:70)(cid:82)(cid:80)(cid:3)

KEY BRANDS

(cid:3) (cid:3)

(cid:3)

(cid:3)(cid:3)(cid:3)

(cid:3)(cid:3)

(cid:3)

(cid:3)

(cid:3)

(cid:3)

(cid:3)

(cid:3)

(cid:3)

(cid:3)

(cid:3)

(cid:3)

BOARD OF DIRECTORS 

Robert J. Byrne
Chairman of the Board,

Executive Chairman of Source2, Inc.

Former Founder and President of
Power Pro Tech Services, Inc. 

Jody L. Bilney
Retired Chief Consumer 
Officer of Humana, Inc.

Peter R. Dachowski
Senior Advisor, Graham Partners 

Retired Chairman and Chief Executive 
Officer of CertainTeed Corporation

Jonathan F. Foster
Founder and Managing Director of 
Current Capital Partners LLC

OFFICERS

Thomas W. Greene
Retired Chief Information and Business
Services Officer of Colgate-Palmolive

William S. Oesterle
Founder and Chief Executive 
Officer of tMap, L.L.C.

Howard C. Heckes
President and Chief Executive Officer
of Masonite International Corporation

Daphne E. Jones
Retired Senior Vice President – Digital/
Future of Work of GE Healthcare

George A. Lorch
Retired Chief Executive Officer
and President of Armstrong 
World Industries, Inc.

Former Executive Chairman of OurHealth,
L.L.C. and Co-Founder of Angie’s List 

Francis M. Scricco
Retired Senior Vice President,
Manufacturing, Logistics and
Procurement of Avaya, Inc.

Former President and Chief Executive
Officer of Arrow Electronics

Howard C. Heckes
President and Chief Executive Officer

Robert A. Paxton
Senior Vice President, Human Resources 

Russell T. Tiejema
Executive Vice President and 
Chief Financial Officer

James A. “Tony” Hair
President – Global Residential 

Robert E. Lewis
Senior Vice President, General
Counsel and Corporate Secretary

Clare R. Doyle
Senior Vice President and General
Manager – UK Business

Cory J. Sorice
Senior Vice President and 
Chief Innovation Officer

Andrew G. “Graham” Thayer
Senior Vice President and Business 
Leader – Architectural 

Randal A. White
Senior Vice President, Global
Operations and Supply Chain

Daniel J. “Dan” Shirk
Senior Vice President and 
Chief Information Officer  

masonite.com

©2020 Masonite International Corporation. All rights reserved.