hbp-10q_20220331.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2022

☐ 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 1-14982

HUTTIG BUILDING PRODUCTS, INC.

(Exact name of registrant as specified in its charter)

Delaware		43-0334550
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
555 Maryville University Drive Suite 400 St. Louis, Missouri		63141
(Address of principal executive offices)		(Zip code)

(314) 216-2600

(Registrant’s telephone number, including area code)

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

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common, par value $0.01 per share	HBP	The NASDAQ Stock Market LLC

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

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

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

Large accelerated filer	☐	Accelerated filer	☑

Non-accelerated filer	☐	Smaller reporting company	☑

		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.☐

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

The number of shares of Common Stock outstanding on May 2, 2022 was 27,326,213 shares.

		Page No.
PART I. FINANCIAL INFORMATION

Item 1.	Financial Statements	3

	Condensed Consolidated Statements of Operations for the three months ended March 31, 2022 and 2021 (unaudited)	3

	Condensed Consolidated Balance Sheets as of March 31, 2022, December 31, 2021 and March 31, 2021 (unaudited)	4

	Condensed Consolidated Statement of Shareholders’ Equity for the three months ended March 31, 2022 and 2021 (unaudited)	6

	Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2022 and 2021 (unaudited)	7

	Notes to Condensed Consolidated Financial Statements (unaudited)	8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	13

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	18

Item 4.	Controls and Procedures	18

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	19

Item 1A.	Risk Factors	19

Item 6.	Exhibits	20

Signatures		21

PART I FINANCIAL INFORMATION

ITEM 1 — FINANCIAL STATEMENTS

HUTTIG BUILDING PRODUCTS, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

(in millions, except per share data)

	Three Months Ended
	March 31,
	2022		2021
Net sales	$	272.7	$	214.7
Cost of sales		209.7		169.0
Gross margin		63.0		45.7
Operating expenses		42.0		36.9
Operating income		21.0		8.8
Interest expense, net		0.5		0.7
Income from operations before income taxes		20.5		8.1
Income tax provision		5.0		—
Income from continuing operations		15.5		8.1
Loss from discontinued operations, net of taxes		—		—
Net income	$	15.5	$	8.1

Earnings per share:
Earnings from continuing operations per share- basic and diluted	$	0.56	$	0.30
Loss from discontinued operations per share- basic and diluted		—		—
Net earnings per share - basic and diluted	$	0.56	$	0.30

Weighted average shares outstanding:
Basic shares outstanding		27.5		27.3
Diluted shares outstanding		27.5		27.4

See notes to condensed consolidated financial statements

HUTTIG BUILDING PRODUCTS, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited)

(in millions)

	March 31,		December 31,		March 31,
	2022		2021		2021
ASSETS
CURRENT ASSETS:
Cash and equivalents	$	3.9	$	3.3	$	4.4
Trade accounts receivable, net		136.6		88.6		107.4
Inventories, net		143.3		128.8		122.6
Other current assets		14.0		18.3		10.4
Total current assets		297.8		239.0		244.8

PROPERTY, PLANT AND EQUIPMENT:
Land		5.0		5.0		5.0
Buildings and improvements		32.2		31.8		32.3
Machinery and equipment		61.4		60.5		58.5
Gross property, plant and equipment		98.6		97.3		95.8
Less accumulated depreciation		71.3		70.3		68.2
Property, plant and equipment, net		27.3		27.0		27.6

OTHER ASSETS:
Operating lease right-of-use assets		36.4		38.1		34.3
Other		5.8		5.7		4.2
Total other assets		42.2		43.8		38.5
TOTAL ASSETS	$	367.3	$	309.8	$	310.9

See notes to condensed consolidated financial statements

HUTTIG BUILDING PRODUCTS, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited)

(in millions, except share data)

	March 31,		December 31,		March 31,
	2022		2021		2021
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Current maturities of long-term debt	$	1.8	$	1.8	$	1.7
Current maturities of operating lease right-of-use liabilities		10.3		10.2		8.9
Trade accounts payable		100.2		66.4		80.0
Accrued compensation		7.6		18.0		10.6
Other accrued liabilities		26.7		20.1		16.6
Total current liabilities		146.6		116.5		117.8
NON-CURRENT LIABILITIES:
Long-term debt, less current maturities		83.5		69.6		113.5
Operating lease right-of-use liabilities, less current maturities		26.2		27.9		25.5
Other non-current liabilities		2.6		2.7		2.5
Total non-current liabilities		112.3		100.2		141.5

SHAREHOLDERS’ EQUITY:
Preferred shares: $.01 par (5,000,000 shares authorized)		—		—		—
Common shares: $.01 par (75,000,000 shares authorized: 27,327,813; 27,390,741; and 27,404,518 shares issued and outstanding at March 31, 2022, December 31, 2021 and March 31, 2021, respectively)		0.3		0.3		0.3
Additional paid-in capital		50.6		50.8		49.7
Retained earnings		57.5		42.0		1.6
Total shareholders’ equity		108.4		93.1		51.6

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	367.3	$	309.8	$	310.9

See notes to condensed consolidated financial statements

HUTTIG BUILDING PRODUCTS, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY

(unaudited)

(in millions)

	Common Shares		Additional			Retained Earnings			Total
	Outstanding,		Paid-In			(Accumulated			Shareholders’
	at Par Value		Capital			Deficit)			Equity
Balance at January 1, 2021	$	0.3	$	49.5		$	(6.5	)	$	43.3
Net income		—		—			8.1			8.1
Payment for taxes related to share settlement of equity awards		—		(0.2	)		—			(0.2	)
Stock compensation expense		—		0.4			—			0.4
Balance at March 31, 2021	$	0.3	$	49.7		$	1.6		$	51.6

Balance at January 1, 2022	$	0.3	$	50.8		$	42.0		$	93.1
Net income		—		—			15.5			15.5
Payment for taxes related to share settlement of equity awards		—		(0.4	)		—			(0.4	)
Stock compensation expense		—		0.2			—			0.2
Balance at March 31, 2022	$	0.3	$	50.6		$	57.5		$	108.4

See notes to condensed consolidated financial statements

HUTTIG BUILDING PRODUCTS, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

(in millions)

	Three Months Ended
	March 31,
	2022		2021
Cash Flows From Operating Activities:
Net income	$	15.5

SEC Form 10-Q filed by Huttig Building Products Inc.