0000883902--12-312021Q1FALSEus-gaap:AccountingStandardsUpdate201613MemberP3YP3YP3Y00008839022021-01-012021-04-03xbrli:shares00008839022021-05-04iso4217:USD00008839022020-01-012020-04-04iso4217:USDxbrli:shares00008839022021-04-0300008839022020-12-310000883902cnr:ABLCreditFacilityDue2023Member2021-01-012021-04-030000883902cnr:ABLCreditFacilityDue2023Member2020-01-012020-04-040000883902cnr:CashFlowRevolverDueApril2023Member2021-01-012021-04-030000883902cnr:CashFlowRevolverDueApril2023Member2020-01-012020-04-0400008839022019-12-3100008839022020-04-040000883902us-gaap:CommonStockMember2020-12-310000883902us-gaap:AdditionalPaidInCapitalMember2020-12-310000883902us-gaap:RetainedEarningsMember2020-12-310000883902us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-12-310000883902us-gaap:TreasuryStockMember2020-12-310000883902us-gaap:TreasuryStockMember2021-01-012021-04-030000883902us-gaap:CommonStockMember2021-01-012021-04-030000883902us-gaap:AdditionalPaidInCapitalMember2021-01-012021-04-030000883902us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-01-012021-04-030000883902us-gaap:RetainedEarningsMember2021-01-012021-04-030000883902us-gaap:CommonStockMember2021-04-030000883902us-gaap:AdditionalPaidInCapitalMember2021-04-030000883902us-gaap:RetainedEarningsMember2021-04-030000883902us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-04-030000883902us-gaap:TreasuryStockMember2021-04-030000883902us-gaap:CommonStockMember2019-12-310000883902us-gaap:AdditionalPaidInCapitalMember2019-12-310000883902us-gaap:RetainedEarningsMember2019-12-310000883902us-gaap:AccumulatedOtherComprehensiveIncomeMember2019-12-310000883902us-gaap:TreasuryStockMember2019-12-310000883902us-gaap:TreasuryStockMember2020-01-012020-04-040000883902us-gaap:CommonStockMember2020-01-012020-04-040000883902us-gaap:AdditionalPaidInCapitalMember2020-01-012020-04-040000883902us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-01-012020-04-0400008839022020-01-012020-12-310000883902us-gaap:RetainedEarningsMembersrt:CumulativeEffectPeriodOfAdoptionAdjustmentMember2019-12-310000883902srt:CumulativeEffectPeriodOfAdoptionAdjustmentMember2019-12-310000883902us-gaap:RetainedEarningsMember2020-01-012020-04-040000883902us-gaap:CommonStockMember2020-04-040000883902us-gaap:AdditionalPaidInCapitalMember2020-04-040000883902us-gaap:RetainedEarningsMember2020-04-040000883902us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-04-040000883902us-gaap:TreasuryStockMember2020-04-040000883902srt:CumulativeEffectPeriodOfAdoptionAdjustmentMember2020-12-310000883902cnr:VinylMembercnr:WindowsSegmentMember2021-01-012021-04-030000883902cnr:VinylMembercnr:WindowsSegmentMember2020-01-012020-04-040000883902cnr:WindowsSegmentMembercnr:AluminumWindowsMember2021-01-012021-04-030000883902cnr:WindowsSegmentMembercnr:AluminumWindowsMember2020-01-012020-04-040000883902cnr:WindowsSegmentMembercnr:OtherProductsAndServicesMember2021-01-012021-04-030000883902cnr:WindowsSegmentMembercnr:OtherProductsAndServicesMember2020-01-012020-04-040000883902cnr:WindowsSegmentMember2021-01-012021-04-030000883902cnr:WindowsSegmentMember2020-01-012020-04-040000883902cnr:VinylSidingMembercnr:SidingSegmentMember2021-01-012021-04-030000883902cnr:VinylSidingMembercnr:SidingSegmentMember2020-01-012020-04-040000883902cnr:SidingSegmentMembercnr:MetalMember2021-01-012021-04-030000883902cnr:SidingSegmentMembercnr:MetalMember2020-01-012020-04-040000883902cnr:InjectionMoldedMembercnr:SidingSegmentMember2021-01-012021-04-030000883902cnr:InjectionMoldedMembercnr:SidingSegmentMember2020-01-012020-04-040000883902cnr:StoneMembercnr:SidingSegmentMember2021-01-012021-04-030000883902cnr:StoneMembercnr:SidingSegmentMember2020-01-012020-04-040000883902cnr:SidingSegmentMembercnr:OtherProductsAndServicesMember2021-01-012021-04-030000883902cnr:SidingSegmentMembercnr:OtherProductsAndServicesMember2020-01-012020-04-040000883902cnr:SidingSegmentMember2021-01-012021-04-030000883902cnr:SidingSegmentMember2020-01-012020-04-040000883902cnr:CommercialSegmentMembercnr:MetalBuildingProductsMember2021-01-012021-04-030000883902cnr:CommercialSegmentMembercnr:MetalBuildingProductsMember2020-01-012020-04-040000883902cnr:CommercialSegmentMembercnr:InsulatedMetalPanelsMember2021-01-012021-04-030000883902cnr:CommercialSegmentMembercnr:InsulatedMetalPanelsMember2020-01-012020-04-040000883902cnr:CommercialSegmentMembercnr:MetalCoilCoatingMember2021-01-012021-04-030000883902cnr:CommercialSegmentMembercnr:MetalCoilCoatingMember2020-01-012020-04-040000883902cnr:CommercialSegmentMember2021-01-012021-04-030000883902cnr:CommercialSegmentMember2020-01-012020-04-04xbrli:pure0000883902cnr:KlearyMasonryIncMember2020-03-020000883902cnr:KlearyMasonryIncMember2020-03-022020-03-020000883902cnr:KlearyMasonryIncMember2020-04-052020-07-040000883902cnr:KlearyMasonryIncMembercnr:SidingSegmentMember2020-03-020000883902cnr:KlearyMasonryIncMember2020-01-012020-04-040000883902us-gaap:CorporateNonSegmentMember2021-01-012021-04-0300008839022019-01-012021-04-030000883902us-gaap:EmployeeSeveranceMember2021-01-012021-04-030000883902us-gaap:EmployeeSeveranceMember2019-01-012021-04-030000883902cnr:AssetImpairmentMember2021-01-012021-04-030000883902cnr:AssetImpairmentMember2019-01-012021-04-030000883902cnr:GainOnSaleOfFacilityMember2021-01-012021-04-030000883902cnr:GainOnSaleOfFacilityMember2019-01-012021-04-030000883902us-gaap:OtherRestructuringMember2021-01-012021-04-030000883902us-gaap:OtherRestructuringMember2019-01-012021-04-030000883902cnr:RestructuringAndImpairmentCostsMember2021-01-012021-04-030000883902us-gaap:OperatingSegmentsMembercnr:WindowsSegmentMember2018-12-310000883902us-gaap:OperatingSegmentsMembercnr:SidingSegmentMember2018-12-310000883902us-gaap:OperatingSegmentsMembercnr:CommercialSegmentMember2018-12-310000883902us-gaap:CorporateNonSegmentMember2018-12-3100008839022018-12-310000883902us-gaap:OperatingSegmentsMembercnr:WindowsSegmentMember2019-01-012019-12-310000883902us-gaap:OperatingSegmentsMembercnr:SidingSegmentMember2019-01-012019-12-310000883902us-gaap:OperatingSegmentsMembercnr:CommercialSegmentMember2019-01-012019-12-310000883902us-gaap:CorporateNonSegmentMember2019-01-012019-12-3100008839022019-01-012019-12-310000883902us-gaap:OperatingSegmentsMembercnr:WindowsSegmentMember2019-12-310000883902us-gaap:OperatingSegmentsMembercnr:SidingSegmentMember2019-12-310000883902us-gaap:OperatingSegmentsMembercnr:CommercialSegmentMember2019-12-310000883902us-gaap:CorporateNonSegmentMember2019-12-310000883902us-gaap:OperatingSegmentsMembercnr:WindowsSegmentMember2020-01-012020-12-310000883902us-gaap:OperatingSegmentsMembercnr:SidingSegmentMember2020-01-012020-12-310000883902us-gaap:OperatingSegmentsMembercnr:CommercialSegmentMember2020-01-012020-12-310000883902us-gaap:CorporateNonSegmentMember2020-01-012020-12-310000883902us-gaap:OperatingSegmentsMembercnr:WindowsSegmentMember2020-12-310000883902us-gaap:OperatingSegmentsMembercnr:SidingSegmentMember2020-12-310000883902us-gaap:OperatingSegmentsMembercnr:CommercialSegmentMember2020-12-310000883902us-gaap:CorporateNonSegmentMember2020-12-310000883902us-gaap:OperatingSegmentsMembercnr:WindowsSegmentMember2021-01-012021-04-030000883902us-gaap:OperatingSegmentsMembercnr:SidingSegmentMember2021-01-012021-04-030000883902us-gaap:OperatingSegmentsMembercnr:CommercialSegmentMember2021-01-012021-04-030000883902us-gaap:OperatingSegmentsMembercnr:WindowsSegmentMember2021-04-030000883902us-gaap:OperatingSegmentsMembercnr:SidingSegmentMember2021-04-030000883902us-gaap:OperatingSegmentsMembercnr:CommercialSegmentMember2021-04-030000883902us-gaap:CorporateNonSegmentMember2021-04-030000883902srt:MinimumMember2021-01-012021-04-030000883902srt:MaximumMember2021-01-012021-04-030000883902cnr:WindowsSegmentMember2019-12-310000883902cnr:SidingSegmentMember2019-12-310000883902cnr:CommercialSegmentMember2019-12-310000883902cnr:WindowsSegmentMember2020-12-310000883902cnr:SidingSegmentMember2020-12-310000883902cnr:CommercialSegmentMember2020-12-310000883902cnr:WindowsSegmentMember2021-04-030000883902cnr:SidingSegmentMember2021-04-030000883902cnr:CommercialSegmentMember2021-04-030000883902us-gaap:InventoriesMember2021-01-012021-04-030000883902us-gaap:TrademarksAndTradeNamesMembersrt:MinimumMember2021-01-012021-04-030000883902us-gaap:TrademarksAndTradeNamesMembersrt:MaximumMember2021-01-012021-04-030000883902srt:WeightedAverageMemberus-gaap:TrademarksAndTradeNamesMember2021-01-012021-04-030000883902us-gaap:TrademarksAndTradeNamesMember2021-04-030000883902cnr:CustomerListsAndRelationshipsMembersrt:MinimumMember2021-01-012021-04-030000883902cnr:CustomerListsAndRelationshipsMembersrt:MaximumMember2021-01-012021-04-030000883902srt:WeightedAverageMembercnr:CustomerListsAndRelationshipsMember2021-01-012021-04-030000883902cnr:CustomerListsAndRelationshipsMember2021-04-030000883902srt:WeightedAverageMember2021-01-012021-04-030000883902us-gaap:TrademarksAndTradeNamesMembersrt:MinimumMember2020-01-012020-12-310000883902us-gaap:TrademarksAndTradeNamesMembersrt:MaximumMember2020-01-012020-12-310000883902srt:WeightedAverageMemberus-gaap:TrademarksAndTradeNamesMember2020-01-012020-12-310000883902us-gaap:TrademarksAndTradeNamesMember2020-12-310000883902cnr:CustomerListsAndRelationshipsMembersrt:MinimumMember2020-01-012020-12-310000883902cnr:CustomerListsAndRelationshipsMembersrt:MaximumMember2020-01-012020-12-310000883902srt:WeightedAverageMembercnr:CustomerListsAndRelationshipsMember2020-01-012020-12-310000883902cnr:CustomerListsAndRelationshipsMember2020-12-310000883902srt:WeightedAverageMember2020-01-012020-12-310000883902us-gaap:EmployeeStockOptionMembersrt:MinimumMembercnr:IncentivePlanMember2021-01-012021-04-030000883902us-gaap:RestrictedStockUnitsRSUMembersrt:MinimumMembercnr:IncentivePlanMember2021-01-012021-04-030000883902us-gaap:EmployeeStockOptionMembercnr:IncentivePlanMembersrt:MaximumMember2021-01-012021-04-030000883902us-gaap:RestrictedStockUnitsRSUMembercnr:IncentivePlanMembersrt:MaximumMember2021-01-012021-04-030000883902us-gaap:PerformanceSharesMembersrt:MinimumMembercnr:IncentivePlanMember2021-01-012021-04-030000883902us-gaap:PerformanceSharesMembersrt:MaximumMember2021-04-030000883902us-gaap:PerformanceSharesMembercnr:KeyEmployeeAwardsMember2021-01-012021-04-030000883902us-gaap:RestrictedStockUnitsRSUMembercnr:KeyEmployeeAwardsMember2021-01-012021-04-030000883902us-gaap:RestrictedStockUnitsRSUMembercnr:KeyEmployeeAwardsMember2020-01-012020-04-040000883902cnr:KeyEmployeeAwardsMembercnr:PerformanceStockUnitsMember2021-01-012021-04-030000883902cnr:KeyEmployeeAwardsMembercnr:PerformanceStockUnitsMember2020-01-012020-04-040000883902us-gaap:EmployeeStockOptionMember2021-01-012021-04-030000883902us-gaap:EmployeeStockOptionMember2020-01-012020-04-040000883902us-gaap:PerformanceSharesMember2021-01-012021-04-030000883902us-gaap:PerformanceSharesMember2020-01-012020-04-040000883902us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember2021-01-012021-04-030000883902us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember2020-01-012020-04-040000883902us-gaap:PensionPlansDefinedBenefitMember2021-04-030000883902us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember2021-04-030000883902cnr:EightPercentSeniorNotesDue2026Member2020-12-310000883902cnr:TermLoanFacilityDueApril2025Member2021-04-030000883902cnr:TermLoanFacilityDueApril2025Member2020-12-310000883902cnr:EightPercentSeniorNotesDue2026Member2021-04-030000883902cnr:A6125SeniorNotesDueJanuary2029Member2020-12-310000883902cnr:A6125SeniorNotesDueJanuary2029Member2021-04-030000883902us-gaap:OtherAssetsMembercnr:AblFacilityMembercnr:ABLCreditFacilityDue2023Member2021-04-030000883902us-gaap:OtherAssetsMembercnr:AblFacilityMembercnr:ABLCreditFacilityDue2023Member2020-12-310000883902cnr:TermLoanFacilityMembercnr:PlyGemMember2018-04-120000883902cnr:TermLoanFacilityMembercnr:PlyGemMember2018-04-122018-04-120000883902cnr:CashFlowRevolverMember2018-04-120000883902cnr:TermLoanFacilityMember2018-04-122018-04-120000883902cnr:TermLoanFacilityMembercnr:PlyGemMember2018-11-162018-11-160000883902cnr:AblFacilityMemberus-gaap:RevolvingCreditFacilityMember2018-11-162018-11-160000883902cnr:TermLoanFacilityMemberus-gaap:LondonInterbankOfferedRateLIBORMember2018-04-122018-04-120000883902cnr:TermLoanFacilityMemberus-gaap:BaseRateMember2018-04-122018-04-120000883902cnr:TermLoanFacilityMember2021-01-012021-04-030000883902cnr:TermLoanFacilityMember2021-04-030000883902cnr:CashFlowRevolverMemberus-gaap:LondonInterbankOfferedRateLIBORMember2018-04-122018-04-120000883902srt:MinimumMembercnr:CashFlowRevolverMemberus-gaap:LondonInterbankOfferedRateLIBORMember2018-04-122018-04-120000883902cnr:CashFlowRevolverMemberus-gaap:LondonInterbankOfferedRateLIBORMembersrt:MaximumMember2018-04-122018-04-120000883902us-gaap:BaseRateMembersrt:MinimumMembercnr:CashFlowRevolverMember2018-04-122018-04-120000883902us-gaap:BaseRateMembercnr:CashFlowRevolverMembersrt:MaximumMember2018-04-122018-04-120000883902cnr:CommitmentFeePercentageOneMembersrt:MinimumMembercnr:CashFlowRevolverMember2018-04-122018-04-120000883902cnr:CommitmentFeePercentageOneMembercnr:CashFlowRevolverMembersrt:MaximumMember2018-04-122018-04-120000883902cnr:TermLoanFacilityMembercnr:LeverageRatioTargetAchievedMembersrt:MinimumMember2018-04-122018-04-120000883902cnr:TermLoanFacilityMembercnr:LeverageRatioTargetAchievedMembersrt:MaximumMember2018-04-122018-04-120000883902cnr:CashFlowRevolverMember2018-04-122018-04-120000883902cnr:AblFacilityMemberus-gaap:RevolvingCreditFacilityMember2018-04-120000883902cnr:ABLU.S.FacilityMembercnr:AblFacilityMemberus-gaap:RevolvingCreditFacilityMember2018-04-120000883902cnr:ABLCanadianFacilityMembercnr:AblFacilityMemberus-gaap:RevolvingCreditFacilityMember2018-04-120000883902cnr:AblFacilityMemberus-gaap:RevolvingCreditFacilityMember2018-10-152018-10-150000883902cnr:AblFacilityMemberus-gaap:RevolvingCreditFacilityMember2018-10-150000883902cnr:ABLU.S.FacilityMembercnr:AblFacilityMemberus-gaap:RevolvingCreditFacilityMember2018-10-140000883902cnr:ABLU.S.FacilityMembercnr:AblFacilityMemberus-gaap:RevolvingCreditFacilityMember2018-10-150000883902cnr:ABLCanadianFacilityMembercnr:AblFacilityMemberus-gaap:RevolvingCreditFacilityMember2018-10-140000883902cnr:ABLCanadianFacilityMembercnr:AblFacilityMemberus-gaap:RevolvingCreditFacilityMember2018-10-150000883902cnr:AblFacilityMemberus-gaap:RevolvingCreditFacilityMember2018-11-160000883902cnr:ABLU.S.FacilityMembercnr:AblFacilityMemberus-gaap:RevolvingCreditFacilityMember2018-11-150000883902cnr:ABLU.S.FacilityMembercnr:AblFacilityMemberus-gaap:RevolvingCreditFacilityMember2018-11-160000883902cnr:ABLCanadianFacilityMembercnr:AblFacilityMemberus-gaap:RevolvingCreditFacilityMember2018-11-150000883902cnr:ABLCanadianFacilityMembercnr:AblFacilityMemberus-gaap:RevolvingCreditFacilityMember2018-11-160000883902cnr:AblFacilityMember2021-04-030000883902us-gaap:LondonInterbankOfferedRateLIBORMembercnr:AblFacilityMember2018-04-122018-04-120000883902srt:MinimumMemberus-gaap:LondonInterbankOfferedRateLIBORMembercnr:AblFacilityMember2018-04-122018-04-120000883902us-gaap:LondonInterbankOfferedRateLIBORMembersrt:MaximumMembercnr:AblFacilityMember2018-04-122018-04-120000883902us-gaap:BaseRateMembersrt:MinimumMembercnr:AblFacilityMember2018-04-122018-04-120000883902us-gaap:BaseRateMembersrt:MaximumMembercnr:AblFacilityMember2018-04-122018-04-120000883902cnr:CommitmentFeePercentageOneMembersrt:MinimumMembercnr:AblFacilityMember2018-04-122018-04-120000883902cnr:AblFacilityMemberus-gaap:RevolvingCreditFacilityMember2018-04-122018-04-120000883902cnr:PlyGemMembercnr:EightPercentSeniorNotesDue2026Member2018-04-120000883902cnr:PlyGemMembercnr:EightPercentSeniorNotesDue2026Member2018-04-122018-04-120000883902cnr:EightPercentSeniorNotesDue2026Member2018-04-120000883902cnr:EightPercentSeniorNotesDue2026Member2018-11-160000883902us-gaap:DebtInstrumentRedemptionPeriodOneMembercnr:EightPercentSeniorNotesDue2026Member2018-11-162018-11-160000883902us-gaap:DebtInstrumentRedemptionPeriodTwoMembercnr:EightPercentSeniorNotesDue2026Member2018-11-162018-11-160000883902us-gaap:DebtInstrumentRedemptionPeriodThreeMembercnr:EightPercentSeniorNotesDue2026Member2018-11-162018-11-160000883902us-gaap:DebtInstrumentRedemptionPeriodFourMembercnr:EightPercentSeniorNotesDue2026Member2018-11-162018-11-160000883902cnr:A6125SeniorNotesDueJanuary2029Member2020-09-240000883902cnr:A6125SeniorNotesDueJanuary2029Member2020-09-242020-09-240000883902cnr:A6125SeniorNotesDueJanuary2029Memberus-gaap:DebtInstrumentRedemptionPeriodFiveMember2020-09-242020-09-240000883902cnr:DebtInstrumentRedemptionPeriodSixMembercnr:A6125SeniorNotesDueJanuary2029Member2020-09-242020-09-240000883902cnr:DebtInstrumentRedemptionPeriodSevenMembercnr:A6125SeniorNotesDueJanuary2029Member2020-09-242020-09-240000883902cnr:A6125SeniorNotesDueJanuary2029Membercnr:DebtInstrumentRedemptionPeriodEightMember2020-09-242020-09-240000883902cnr:A6125SeniorNotesDueJanuary2029Membercnr:DebtInstrumentRedemptionPeriodNineMember2020-09-242020-09-240000883902cnr:CdAndRFundMember2021-04-030000883902cnr:CdAndRFundMember2020-12-310000883902cnr:A2017StockRepurchaseProgramMember2017-10-100000883902cnr:A2018StockRepurchaseProgramMember2018-03-070000883902cnr:StockRepurchaseProgramsMember2021-04-030000883902cnr:StockRepurchaseProgramsMember2021-01-012021-04-030000883902cnr:StockRepurchaseProgramsMember2020-01-012020-04-040000883902cnr:CashFlowRevolverMember2021-04-030000883902cnr:AblFacilityMember2021-04-030000883902cnr:TermLoanCreditAgreementDue2025Member2021-04-030000883902cnr:TermLoanCreditAgreementDue2025Member2020-12-310000883902us-gaap:MoneyMarketFundsMemberus-gaap:FairValueInputsLevel1Member2021-04-030000883902us-gaap:FairValueInputsLevel2Memberus-gaap:MoneyMarketFundsMember2021-04-030000883902us-gaap:FairValueInputsLevel3Memberus-gaap:MoneyMarketFundsMember2021-04-030000883902us-gaap:MoneyMarketFundsMember2021-04-030000883902cnr:MutualFundsGrowthMemberus-gaap:FairValueInputsLevel1Member2021-04-030000883902cnr:MutualFundsGrowthMemberus-gaap:FairValueInputsLevel2Member2021-04-030000883902us-gaap:FairValueInputsLevel3Membercnr:MutualFundsGrowthMember2021-04-030000883902cnr:MutualFundsGrowthMember2021-04-030000883902cnr:MutualFundsBlendMemberus-gaap:FairValueInputsLevel1Member2021-04-030000883902us-gaap:FairValueInputsLevel2Membercnr:MutualFundsBlendMember2021-04-030000883902us-gaap:FairValueInputsLevel3Membercnr:MutualFundsBlendMember2021-04-030000883902cnr:MutualFundsBlendMember2021-04-030000883902cnr:MutualFundsForeignBlendMemberus-gaap:FairValueInputsLevel1Member2021-04-030000883902cnr:MutualFundsForeignBlendMemberus-gaap:FairValueInputsLevel2Member2021-04-030000883902cnr:MutualFundsForeignBlendMemberus-gaap:FairValueInputsLevel3Member2021-04-030000883902cnr:MutualFundsForeignBlendMember2021-04-030000883902cnr:MutualFundsFixedIncomeMemberus-gaap:FairValueInputsLevel1Member2021-04-030000883902cnr:MutualFundsFixedIncomeMemberus-gaap:FairValueInputsLevel2Member2021-04-030000883902cnr:MutualFundsFixedIncomeMemberus-gaap:FairValueInputsLevel3Member2021-04-030000883902cnr:MutualFundsFixedIncomeMember2021-04-030000883902us-gaap:FairValueInputsLevel1Member2021-04-030000883902us-gaap:FairValueInputsLevel2Member2021-04-030000883902us-gaap:FairValueInputsLevel3Member2021-04-030000883902cnr:DeferredCompensationPlanMemberus-gaap:FairValueInputsLevel1Member2021-04-030000883902cnr:DeferredCompensationPlanMemberus-gaap:FairValueInputsLevel2Member2021-04-030000883902cnr:DeferredCompensationPlanMemberus-gaap:FairValueInputsLevel3Member2021-04-030000883902cnr:DeferredCompensationPlanMember2021-04-030000883902us-gaap:ForeignExchangeContractMemberus-gaap:FairValueInputsLevel1Member2021-04-030000883902us-gaap:ForeignExchangeContractMemberus-gaap:FairValueInputsLevel2Member2021-04-030000883902us-gaap:ForeignExchangeContractMemberus-gaap:FairValueInputsLevel3Member2021-04-030000883902us-gaap:ForeignExchangeContractMember2021-04-030000883902us-gaap:InterestRateSwapMemberus-gaap:FairValueInputsLevel1Member2021-04-030000883902us-gaap:InterestRateSwapMemberus-gaap:FairValueInputsLevel2Member2021-04-030000883902us-gaap:InterestRateSwapMemberus-gaap:FairValueInputsLevel3Member2021-04-030000883902us-gaap:InterestRateSwapMember2021-04-030000883902us-gaap:MoneyMarketFundsMemberus-gaap:FairValueInputsLevel1Member2020-12-310000883902us-gaap:FairValueInputsLevel2Memberus-gaap:MoneyMarketFundsMember2020-12-310000883902us-gaap:FairValueInputsLevel3Memberus-gaap:MoneyMarketFundsMember2020-12-310000883902us-gaap:MoneyMarketFundsMember2020-12-310000883902cnr:MutualFundsGrowthMemberus-gaap:FairValueInputsLevel1Member2020-12-310000883902cnr:MutualFundsGrowthMemberus-gaap:FairValueInputsLevel2Member2020-12-310000883902us-gaap:FairValueInputsLevel3Membercnr:MutualFundsGrowthMember2020-12-310000883902cnr:MutualFundsGrowthMember2020-12-310000883902cnr:MutualFundsBlendMemberus-gaap:FairValueInputsLevel1Member2020-12-310000883902us-gaap:FairValueInputsLevel2Membercnr:MutualFundsBlendMember2020-12-310000883902us-gaap:FairValueInputsLevel3Membercnr:MutualFundsBlendMember2020-12-310000883902cnr:MutualFundsBlendMember2020-12-310000883902cnr:MutualFundsForeignBlendMemberus-gaap:FairValueInputsLevel1Member2020-12-310000883902cnr:MutualFundsForeignBlendMemberus-gaap:FairValueInputsLevel2Member2020-12-310000883902cnr:MutualFundsForeignBlendMemberus-gaap:FairValueInputsLevel3Member2020-12-310000883902cnr:MutualFundsForeignBlendMember2020-12-310000883902cnr:MutualFundsFixedIncomeMemberus-gaap:FairValueInputsLevel1Member2020-12-310000883902cnr:MutualFundsFixedIncomeMemberus-gaap:FairValueInputsLevel2Member2020-12-310000883902cnr:MutualFundsFixedIncomeMemberus-gaap:FairValueInputsLevel3Member2020-12-310000883902cnr:MutualFundsFixedIncomeMember2020-12-310000883902us-gaap:FairValueInputsLevel1Member2020-12-310000883902us-gaap:FairValueInputsLevel2Member2020-12-310000883902us-gaap:FairValueInputsLevel3Member2020-12-310000883902us-gaap:ForeignExchangeContractMemberus-gaap:FairValueInputsLevel1Member2020-12-310000883902us-gaap:ForeignExchangeContractMemberus-gaap:FairValueInputsLevel2Member2020-12-310000883902us-gaap:ForeignExchangeContractMemberus-gaap:FairValueInputsLevel3Member2020-12-310000883902us-gaap:ForeignExchangeContractMember2020-12-310000883902cnr:DeferredCompensationPlanMemberus-gaap:FairValueInputsLevel1Member2020-12-310000883902cnr:DeferredCompensationPlanMemberus-gaap:FairValueInputsLevel2Member2020-12-310000883902cnr:DeferredCompensationPlanMemberus-gaap:FairValueInputsLevel3Member2020-12-310000883902cnr:DeferredCompensationPlanMember2020-12-310000883902us-gaap:InterestRateSwapMemberus-gaap:FairValueInputsLevel1Member2020-12-310000883902us-gaap:InterestRateSwapMemberus-gaap:FairValueInputsLevel2Member2020-12-310000883902us-gaap:InterestRateSwapMemberus-gaap:FairValueInputsLevel3Member2020-12-310000883902us-gaap:InterestRateSwapMember2020-12-310000883902us-gaap:ForeignExchangeContractMember2021-01-012021-04-030000883902us-gaap:InterestRateSwapMemberus-gaap:DesignatedAsHedgingInstrumentMember2019-05-012019-05-310000883902us-gaap:InterestRateSwapMemberus-gaap:DesignatedAsHedgingInstrumentMember2019-05-31cnr:instrument0000883902us-gaap:InterestRateSwapMemberus-gaap:CashFlowHedgingMemberus-gaap:DesignatedAsHedgingInstrumentMember2019-05-310000883902us-gaap:CashFlowHedgingMembercnr:InterestRateSwapOneMemberus-gaap:DesignatedAsHedgingInstrumentMember2019-05-310000883902us-gaap:CashFlowHedgingMembercnr:InterestRateSwapTwoMemberus-gaap:DesignatedAsHedgingInstrumentMember2019-05-310000883902cnr:InterestRateSwapThreeMemberus-gaap:CashFlowHedgingMemberus-gaap:DesignatedAsHedgingInstrumentMember2019-05-31cnr:reporting_segment0000883902us-gaap:OperatingSegmentsMembercnr:WindowsSegmentMember2020-01-012020-04-040000883902us-gaap:OperatingSegmentsMembercnr:SidingSegmentMember2020-01-012020-04-040000883902us-gaap:OperatingSegmentsMembercnr:CommercialSegmentMember2020-01-012020-04-040000883902us-gaap:CorporateNonSegmentMember2020-01-012020-04-040000883902cnr:RCRAFacilityInvestigationMember2021-04-030000883902cnr:CurrentLiabilitiesMembercnr:RCRAFacilityInvestigationMember2021-04-030000883902cnr:PCETCENortheastContaminationSiteMember2021-04-030000883902cnr:AuroraPlasticsLLCvs.AtriumMember2021-04-030000883902us-gaap:OtherCurrentLiabilitiesMembercnr:AuroraPlasticsLLCvs.AtriumMember2021-04-03cnr:defendant0000883902cnr:VoigtVsCDRCaseMember2019-04-112019-04-110000883902cnr:CountervailingDutyTariffProceedingsMember2021-04-030000883902cnr:AntidumpingTariffProceedingsMember2021-04-030000883902cnr:RecoveryFromCountervailingDutyTariffProceedingsMember2020-12-310000883902us-gaap:SubsequentEventMembercnr:CashFlowRevolverMember2021-04-150000883902us-gaap:SubsequentEventMembercnr:ExtendedCashFlowRevolverMember2021-04-150000883902cnr:TermLoanFacilityMember2021-04-150000883902us-gaap:SubsequentEventMembercnr:TrancheBTermLoanMember2021-04-150000883902us-gaap:SubsequentEventMembercnr:TrancheBTermLoanMember2021-04-152021-04-150000883902us-gaap:SubsequentEventMembercnr:ExtendedABLCommitmentsMemberus-gaap:RevolvingCreditFacilityMemberus-gaap:LineOfCreditMember2021-04-150000883902us-gaap:SubsequentEventMembercnr:EightPercentSeniorNotesDue2026Member2021-04-150000883902us-gaap:SubsequentEventMembercnr:EightPercentSeniorNotesDue2026Member2021-04-152021-04-150000883902us-gaap:SubsequentEventMemberus-gaap:InterestRateSwapMemberus-gaap:DesignatedAsHedgingInstrumentMember2021-04-150000883902us-gaap:SubsequentEventMemberus-gaap:InterestRateSwapMemberus-gaap:NondesignatedMember2021-04-150000883902us-gaap:SubsequentEventMemberus-gaap:InterestRateSwapMembercnr:TrancheBTermLoanMemberus-gaap:NondesignatedMember2021-04-15


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
 
(Mark One) 
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: April 3, 2021
 
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: 1-14315
 
 
Cornerstone Building Brands, Inc.
(Exact name of registrant as specified in its charter)

 
Delaware76-0127701
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)

5020 Weston ParkwaySuite 400CaryNC27513
(Address of principal executive offices)(Zip Code)
 
(866) 419-0042
(Registrant’s telephone number, including area code)

 
 
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 ý 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). ý 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 filerAccelerated filerý
Non-accelerated filer
¨ (Do not check if a smaller reporting company)
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 ý No
 
Securities registered pursuant to Section 12(b) of the Exchange Act:
Title of Each ClassTrading SymbolName of Each Exchange on Which Registered
Common Stock $0.01 par value per shareCNRNew York Stock Exchange

APPLICABLE ONLY TO CORPORATE ISSUERS
 
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
 
Common Stock, $0.01 par value - 125,708,451 shares as of May 4, 2021.





TABLE OF CONTENTS 
  PAGE
  
Item 1.
 
 
 
 
 
Item 2.
Item 3.
Item 4.
   
  
Item 1.
Item 1A.
Item 2.
Item 6.
 

i


PART I — FINANCIAL INFORMATION 
Item 1. Unaudited Consolidated Financial Statements. 
CORNERSTONE BUILDING BRANDS, INC. 
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
 Three Months Ended
 April 3,
2021
April 4,
2020
Sales$1,267,032 $1,113,811 
Cost of sales
1,007,303 882,924 
Gross profit259,729 230,887 
Selling, general and administrative expenses153,168 164,954 
Intangible asset amortization46,202 44,861 
Restructuring and impairment charges, net1,838 13,835 
Strategic development and acquisition related costs3,313 4,857 
Goodwill impairment 503,171 
Income (loss) from operations55,208 (500,791)
Interest income117 338 
Interest expense(56,499)(54,835)
Foreign exchange loss(26)(4,137)
Other income (expense), net337 (662)
Loss before income taxes(863)(560,087)
Provision (benefit) for income taxes792 (18,014)
Net loss(1,655)(542,073)
Net income allocated to participating securities  
Net loss applicable to common shares$(1,655)$(542,073)
Loss per common share:
Basic$(0.01)$(4.30)
Diluted$(0.01)$(4.30)
Weighted average number of common shares outstanding:
Basic125,506 126,093 
Diluted125,506 126,093 
See accompanying notes to consolidated financial statements.
 


1


CORNERSTONE BUILDING BRANDS, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(In thousands)
(Unaudited)
 Three Months Ended
 April 3,
2021
April 4,
2020
Comprehensive income (loss):  
Net loss$(1,655)$(542,073)
Other comprehensive income (loss), net of tax:  
Foreign exchange translation gains (losses)6,113 (9,563)
Unrealized gain (loss) on derivative instruments, net of income tax of $(2,690) and $12,032, respectively
9,137 (38,176)
Other comprehensive income (loss)15,250 (47,739)
Comprehensive income (loss)$13,595 $(589,812)
See accompanying notes to consolidated financial statements.
2


CORNERSTONE BUILDING BRANDS, INC. 
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
(Unaudited)
 April 3,
2021
December 31,
2020
ASSETS  
Current assets:  
Cash and cash equivalents$666,717 $674,255 
Restricted cash6,223 6,223 
Accounts receivable, less allowances of $14,427 and $13,313, respectively
601,476 554,649 
Inventories, net494,092 431,937 
Income taxes receivable31,403 39,379 
Investments in debt and equity securities, at market2,527 2,333 
Prepaid expenses and other84,127 77,751 
Assets held for sale3,909 4,644 
     Total current assets1,890,474 1,791,171 
Property, plant and equipment, less accumulated depreciation of $670,072 and $644,308, respectively
628,198 631,821 
Lease right-of-use assets260,424 264,107 
Goodwill1,195,983 1,194,729 
Intangible assets, net1,540,470 1,584,604 
Deferred income taxes2,411 1,867 
Other assets, net10,346 10,191 
     Total assets$5,528,306 $5,478,490 
LIABILITIES AND STOCKHOLDERS’ EQUITY  
Current liabilities:  
Current portion of long-term debt$25,600 $25,600 
Accounts payable260,930 211,441 
Accrued compensation and benefits73,962 81,548 
Accrued interest38,515 25,485 
Accrued income taxes5,650 5,060 
Current portion of lease liabilities69,042 70,125 
Other accrued expenses255,288 247,893 
     Total current liabilities728,987 667,152 
Long-term debt3,559,339 3,563,429 
Deferred income taxes263,641 269,792 
Long-term lease liabilities194,672 198,875 
Other long-term liabilities324,020 337,437 
     Total long-term liabilities4,341,672 4,369,533 
Stockholders’ equity:  
Common stock, $0.01 par value; 200,000,000 authorized; 125,807,655 and 125,676,292 shares issued and outstanding at April 3, 2021, respectively; and 125,425,931 and 125,400,599 shares issued and outstanding at December 31, 2020, respectively
1,258 1,255 
Additional paid-in capital1,260,946 1,257,262 
Accumulated deficit(766,340)(764,685)
Accumulated other comprehensive loss, net(36,267)(51,517)
Treasury stock, at cost (131,363 and 25,332 shares at April 3, 2021 and December 31, 2020, respectively)
(1,950)(510)
     Total stockholders’ equity457,647 441,805 
     Total liabilities and stockholders’ equity$5,528,306 $5,478,490 
See accompanying notes to consolidated financial statements.
3



CORNERSTONE BUILDING BRANDS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
 Three Months Ended
 April 3,
2021
April 4,
2020
Cash flows from operating activities:  
Net loss$(1,655)$(542,073)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:  
Depreciation and amortization72,615 69,769 
Non-cash interest expense2,314 2,274 
Share-based compensation expense3,302 3,387 
Goodwill impairment 503,171 
Asset impairment493 3,079 
Provision for credit losses676 725 
Deferred income taxes(9,729)(35,734)
Changes in operating assets and liabilities, net of effect of acquisitions:  
Accounts receivable(47,157)20,532 
Inventories(62,028)(20,724)
Income taxes7,976 18,212 
Prepaid expenses and other(7,755)1,554 
Accounts payable49,424 12,461 
Accrued expenses8,597 (40,662)
Other, net2,958 1,805 
Net cash provided by (used in) operating activities20,031 (2,224)
Cash flows from investing activities:  
Acquisitions, net of cash acquired(180)(39,857)
Capital expenditures(21,230)(27,567)
Proceeds from sale of property, plant and equipment715  
Net cash used in investing activities(20,695)(67,424)
Cash flows from financing activities:  
Proceeds from stock options exercised486  
Proceeds from ABL facility 345,000 
Proceeds from cash flow revolver 115,000 
Payments on term loan(6,404)(6,405)
Payments related to tax withholding for share-based compensation(1,541)(327)
Net cash provided by (used in) financing activities(7,459)453,268 
Effect of exchange rate changes on cash and cash equivalents585 (2,302)
Net increase (decrease) in cash, cash equivalents and restricted cash(7,538)381,318 
Cash, cash equivalents and restricted cash at beginning of period680,478 102,307 
Cash, cash equivalents and restricted cash at end of period$672,940 $483,625 
Supplemental disclosure of cash flow information:
Interest paid, net of amounts capitalized$40,913 $36,931 
Taxes paid, net$1,949 $392 
 See accompanying notes to consolidated financial statements.
4



CORNERSTONE BUILDING BRANDS, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(In thousands, except share data)
(Unaudited)
Common StockAdditional Paid-In CapitalRetained Earnings (Deficit)Accumulated Other Comprehensive Income (Loss)Treasury StockStockholders’ Equity
 SharesAmountSharesAmount
December 31, 2020125,425,931 $1,255 $1,257,262 $(764,685)$(51,517)(25,332)$(510)$441,805 
Treasury stock purchases— — — — — (111,868)(1,541)(1,541)
Retirement of treasury shares(1,576) (15)— — 1,576 15  
Issuance of restricted stock338,939 3 (3)— — — —  
Stock options exercised44,361 — 486 — — — — 486 
Other comprehensive income— — — — 15,250 — — 15,250 
Deferred compensation obligation—  (86)— — 4,261 86  
Share-based compensation— — 3,302 — — — — 3,302 
Net loss— — — (1,655)— — — (1,655)
Balance, April 3, 2021125,807,655 $1,258 $1,260,946 $(766,340)$(36,267)(131,363)$(1,950)$457,647 
Balance, December 31, 2019126,110,000 $1,261 $1,248,787 $(281,229)$(32,398)(55,513)$(1,103)$935,318 
Treasury stock purchases— — — — — (37,794)(327)(327)
Retirement of treasury shares(38,206)(1)(328)— — 38,206 329  
Issuance of restricted stock95,851 1 (1)— — — —  
Other comprehensive loss— — — — (47,739)— — (47,739)
Deferred compensation obligation— 1 (593)— — 29,769 592  
Share-based compensation— — 3,387 — — — — 3,387 
Cumulative effect of accounting change— — — (678)— — — (678)
Net loss— — — (542,073)— — — (542,073)
Balance, April 4, 2020126,167,645 $1,262 $1,251,252 $(823,980)$(80,137)(25,332)$(509)$347,888 
See accompanying notes to consolidated financial statements.

5


CORNERSTONE BUILDING BRANDS, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
April 3, 2021
(Unaudited)

NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying unaudited consolidated financial statements for Cornerstone Building Brands, Inc. (together with its subsidiaries, unless otherwise indicated, the “Company,” “Cornerstone,” “we,” “us” or “our”) have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by generally accepted accounting principles (“GAAP”) for complete financial statements. In the opinion of management, the unaudited consolidated financial statements included herein contain all adjustments, which consist of normal recurring adjustments, necessary to fairly present the Company’s financial position, results of operations and cash flows for the periods indicated. Operating results for the period from January 1, 2021 through April 3, 2021 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2021.
For additional information, refer to the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020 filed with the Securities and Exchange Commission (the “SEC”) on March 4, 2021.
Reporting Periods
The Company’s current fiscal quarters are based on a four-four-five week calendar with periods ending on the Saturday of the last week in the quarter except that December 31st will always be the year-end date. Therefore, the financial results of certain fiscal quarters may not be comparable to prior fiscal quarters.
Restricted Cash
The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets that total the amounts shown in the consolidated statements of cash flows (in thousands):
 April 3,
2021
December 31,
2020
Cash and cash equivalents$666,717 $674,255 
Restricted cash(1)
6,223 6,223 
Total cash, cash equivalents and restricted cash shown in the consolidated statements of cash flows$672,940 $680,478 
(1)Restricted cash primarily relates to escrow balances held for an outstanding earn-out agreement and working capital and other indemnification agreements.
Accounts Receivables and Related Allowance
The Company reports accounts receivable net of the allowance for expected credit losses. Trade accounts receivable are the result of sales of vinyl windows, aluminum windows, vinyl siding, metal siding, injection molded products, metal building products, insulated metal panels, metal coating, and other products and services to customers throughout the United States and Canada and affiliated territories, including international builders who resell to end users. Sales are primarily denominated in U.S. dollars. Credit sales do not normally require a pledge of collateral; however, various types of liens may be filed to enhance the collection process and we require payment prior to shipment for certain international shipments.
The Company establishes provision for expected credit losses based on the Company’s assessment of the collectability of amounts owed to us by our customers. Such provisions are included in selling, general and administrative expenses. In establishing these reserves, the Company considers changes in the financial position of a customer, age of the accounts receivable balances, availability of security, unusual macroeconomic conditions, lien rights and bond rights as well as disputes, if any, with our customers. Our allowance for credit losses reflects reserves for customer receivables to reduce receivables to amounts expected to be collected. Interest on delinquent accounts receivable is included in the trade accounts receivable balance and recognized as interest income when earned and collectability is reasonably assured. Uncollectible accounts are written off when a settlement is reached for an amount that is less than the outstanding historical balance, all collection efforts have been exhausted, and/or any legal action taken by the Company has concluded.
6


The following table represents the rollforward of the allowance for credit losses for the periods indicated (in thousands):
Three Months Ended
April 3,
2021
April 4,
2020
Ending balance, prior period$13,313 $9,962 
Cumulative effect of accounting change(1)
 678 
Provision for expected credit losses676 725 
Amounts charged against allowance for credit losses, net of recoveries438 (354)
Allowance for credit losses of acquired company at date of acquisition 810 
Ending balance$14,427 $11,821 
(1)Cumulative effect of accounting change reflects the modified retrospective effect of adopting ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.
Net Sales
The Company enters into contracts that pertain to products, which are accounted for as separate performance obligations and are typically one year or less in duration. Given the nature of the Company's sales arrangements, they do not require us to exercise significant judgment in determining the timing for the satisfaction of performance obligations or the transaction price. Revenue is measured as the amount of consideration expected to be received in exchange for our products. Revenue is generally recognized when the product has shipped from our facility and control has transferred to the customer. For a portion of our business, when we process customer owned material, control is deemed to transfer to the customer as the processing is being completed.
The Company’s revenues are adjusted for variable consideration, which includes customer volume rebates and prompt payment discounts. The Company measures variable consideration by estimating expected outcomes using analysis and inputs based upon anticipated performance, historical data, and current and forecasted information. Customer returns are recorded as a reduction to sales on an actual basis throughout the year and also include an estimate at the end of each reporting period for future customer returns related to sales recorded prior to the end of the period. The Company generally estimates customer returns based upon the time lag that historically occurs between the sale date and the return date while also factoring in any new business conditions that might impact the historical analysis such as new product introduction. Measurement of variable consideration is reviewed by management periodically and revenue is adjusted accordingly. We do not have significant financing components. The Company recognizes installation revenue, primarily within the stone veneer business, over the period for which the stone is installed, which is typically a very short duration.
Shipping and handling activities performed by us are considered activities to fulfill the sales of our products. Amounts billed for shipping and handling are included in net sales, while costs incurred for shipping and handling are included in cost of sales.
In accordance with certain contractual arrangements, we receive payment from our customers in advance related to performance obligations that are to be satisfied in the future and recognize such payments as deferred revenue, primarily related to the Company’s weathertightness warranties (see Note 12 — Warranty).
A portion of the Company’s revenue, exclusively within the Commercial segment, includes multiple-element revenue arrangements due to multiple deliverables. Each deliverable is generally determined based on customer-specific manufacturing and delivery requirements. Because the separate deliverables have value to the customer on a stand-alone basis, they are typically considered separate units of accounting. A portion of the entire job order value is allocated to each unit of accounting. Revenue allocated to each deliverable is recognized upon shipment. The Company uses estimated selling price (“ESP”) based on underlying cost plus a reasonable margin to determine how to separate multiple-element revenue arrangements into separate units of accounting, and how to allocate the arrangement consideration among those separate units of accounting. The Company determines ESP based on normal pricing and discounting practices.
7


The following table presents disaggregated revenue disclosure details of net sales by segment (in thousands):
Three Months Ended
April 3,
2021
April 4,
2020
Windows Net Sales Disaggregation:
Vinyl windows$497,017 $419,022 
Aluminum windows20,280 19,476 
Other9,966 9,952 
Total$527,263 $448,450 
Siding Net Sales Disaggregation:
Vinyl siding$150,229 $109,548 
Metal71,093 52,666 
Injection molded17,609 13,239 
Stone19,831 18,810 
Other products & services(1)
57,629 46,780 
Total$316,391 $241,043 
Commercial Net Sales Disaggregation:
Metal building products$299,938 $292,436 
Insulated metal panels85,603 99,229 
Metal coil coating37,837 32,653 
Total$423,378 $424,318 
Total Net Sales:$1,267,032 $1,113,811 
(1)Other products & services primarily consist of installation of stone veneer products.
NOTE 2 — ACCOUNTING PRONOUNCEMENTS
Adopted Accounting Pronouncements
In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, which simplifies the accounting for income taxes by removing certain exceptions to the general principles in Topic 740 and also improves consistent application of and simplifies U.S. GAAP for other areas of Topic 740 by clarifying and amending existing guidance. Effective January 1, 2021, the Company adopted this guidance. The application of ASU 2019-12 did not have a material effect on the consolidated financial statements.
Recent Accounting Pronouncements
In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides optional guidance to ease the potential burden in accounting for reference rate reform on financial reporting. In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848): Scope, which clarifies that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the reference rate transition. The amendments in these ASUs are elective, apply to all entities that have contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of rate reform, and are effective as of March 12, 2020 through December 31, 2022. The Company is evaluating the impact of electing to apply the amendments in this guidance.

8


NOTE 3 — ACQUISITIONS
2020 Acquisition
On March 2, 2020, the Company acquired 100% of the issued and outstanding shares of the common stock of Kleary Masonry, Inc. (“Kleary”) for total consideration of $40.0 million, exclusive of the $2.0 million working capital adjustment that was finalized during the three months ended July 4, 2020. The transaction was financed with cash on hand and through borrowings under the Company’s asset-based revolving credit facility. Kleary primarily services residential customers with manufactured stone installations and commercial customers with manufactured wall installations in the Sacramento, California area, which strengthens the Company’s position as a market leader in stone veneer. Kleary’s results are reported within the Siding segment.
The Company determined the fair value of the tangible and intangible assets and the liabilities acquired, and recorded goodwill based on the excess of the fair value of the acquisition consideration over such fair values, as follows (in thousands):
Assets acquired:
Cash$143 
Accounts receivable7,135 
Inventories670 
Prepaid expenses and other current assets277 
Property, plant and equipment1,042 
Lease right of use assets445 
Intangible assets (trade names/customer relationships)22,350 
Goodwill12,539 
Total assets acquired44,601 
Liabilities assumed:
Accounts payable1,149 
Other accrued expenses1,020 
Lease liabilities339 
Other long-term liabilities109 
Total liabilities assumed2,617 
Net assets acquired$41,984 
The $12.5 million of goodwill from the Kleary acquisition was allocated to the Siding segment and will be deductible for tax purposes. The goodwill is attributable to the workforce of the acquired business and the synergies expected to be realized. The fair value of all assets acquired and liabilities assumed was finalized during the first quarter of 2021, which did not result in any adjustments during the quarter ended April 3, 2021.
Unaudited Pro Forma Financial Information
The following table provides unaudited supplemental pro forma results for Cornerstone for the three months ended April 4, 2020 as if the Kleary acquisitions had occurred on January 1, 2020 (in thousands, except for per share data):
Three Months Ended
April 4, 2020
Net sales$1,122,169 
Net loss applicable to common shares(540,870)
Net loss per common share:
Basic$(4.29)
Diluted$(4.29)
The unaudited supplemental pro forma financial information was prepared based on the historical information of Cornerstone and Kleary. The unaudited supplemental pro forma financial information does not give effect to the potential impact of current financial conditions, any anticipated synergies, operating efficiencies or cost savings that may result from the acquisition or any integration costs. Unaudited pro forma balances are not necessarily indicative of operating results had the Kleary acquisition occurred on January 1, 2020 or of future results.
9


NOTE 4 — RESTRUCTURING
The Company has various initiatives and programs in place within its business units to reduce selling, general, and administrative expenses (“SG&A”), manufacturing costs and to optimize the Company’s combined manufacturing footprint. During the three months ended April 3, 2021, the Company incurred restructuring charges of $0.9 million, $0.1 million and $0.7 million in the Windows, Siding and Commercial segments, respectively, and $0.1 million in restructuring charges at Corporate headquarters. Restructuring charges incurred to date since inception of the current restructuring initiatives began in 2019 are $54.2 million. The following table summarizes our restructuring plan costs and charges related to the restructuring plans for the three months ended April 3, 2021 and costs incurred to date since inception of the new initiatives and programs (in thousands):
 Three Months EndedCosts Incurred to Date
 April 3, 2021(Since inception)
Severance$1,322 $37,553 
Asset impairments493 8,361 
Gain on sale of facilities, net (1,298)
Other restructuring costs23 9,559 
Total restructuring costs$1,838 $54,175 
For the three months ended April 3, 2021, the $1.8 million restructuring costs are recorded within restructuring and impairment costs. The asset impairments of $0.5 million for the three months ended April 3, 2021 are comprised primarily of the write-off of previously capitalized website design costs.
The following table summarizes our severance liability, included within other accrued expenses on the consolidated balance sheets, and cash payments made pursuant to the restructuring plans from inception through April 3, 2021 (in thousands):
 WindowsSidingCommercialCorporateTotal
Balance, December 31, 2018$ $85 $ $2,333 $2,418 
Costs incurred1,094 1,834 2,721 4,009 9,658 
Cash payments(676)(1,437)(2,721)(4,579)(9,413)
Balance, December 31, 2019$418 $482 $ $1,763 $2,663 
Costs incurred4,294 2,705 16,561 3,013 26,573 
Cash payments(4,406)(2,352)(14,570)(4,346)(25,674)
Balance, December 31, 2020$306 $835 $1,991 $430 $3,562 
Costs incurred651 118 480 73 1,322 
Cash payments(427)(644)(774)(73)(1,918)
Balance, April 3, 2021$530 $309 $1,697 $430 $2,966 
We expect to fully execute our plans over the next 12 to 24 months and we may incur future additional restructuring charges associated with these plans.
NOTE 5 — GOODWILL
The Company’s goodwill balance and changes in the carrying amount of goodwill by segment are as follows (in thousands):
WindowsSidingCommercialTotal
Balance, December 31, 2019$714,023 $807,280 $148,291 $1,669,594 
Goodwill recognized from Kleary Acquisition 12,539  12,539 
Impairment(1)
(320,990)(176,774)(5,407)(503,171)
Currency translation3,991 10,000  13,991 
Purchase accounting adjustments from prior year acquisitions 1,776  1,776 
Balance, December 31, 2020$397,024 $654,821 $142,884 $1,194,729 
Goodwill recognized from acquisition 122  122 
Currency translation648 484  1,132 
Balance, April 3, 2021$397,672 $655,427 $142,884 $1,195,983 



(1)Goodwill impairment charges occurred during the quarter ended April 4, 2020 as a result of a decline in the Company’s market valuation and near-term economic uncertainties related to the COVID-19 pandemic.
NOTE 6 — INVENTORIES
The components of inventory are as follows (in thousands):
 April 3, 2021December 31, 2020
Raw materials$264,760 $241,353 
Work in process and finished goods229,332 190,584 
Total inventory$494,092 $431,937 
 As of April 3, 2021, the Company had inventory purchase commitments of $115.9 million.
NOTE 7 — INTANGIBLES
The table that follows presents the major components of intangible assets as of April 3, 2021 and December 31, 2020 (in thousands). Intangible assets that are fully amortized are removed from the disclosures.
Range of Life (Years)Weighted Average Amortization Period (Years)CostAccumulated AmortizationNet Carrying Value
As of April 3, 2021
Amortized intangible assets:
Trademarks/Trade names5158$248,155 $(57,767)$190,388 
Customer lists and relationships72091,758,611 (408,529)1,350,082 
Total intangible assets9$2,006,766 $(466,296)$1,540,470 
As of December 31, 2020
Amortized intangible assets:
Trademarks/Trade names5158$248,155 $(51,722)$196,433 
Customer lists and relationships72091,758,611 (370,440)1,388,171 
Total intangible assets9$2,006,766 $(422,162)$1,584,604 

NOTE 8 — ASSETS HELD FOR SALE
We record assets held for sale at the lower of the carrying value or fair value less costs to sell. The following criteria are used to determine if property is held for sale: (i) management has the authority and commits to a plan to sell the property; (ii) the property is available for immediate sale in its present condition; (iii) there is an active program to locate a buyer and the plan to sell the property has been initiated; (iv) the sale of the property is probable within one year; (v) the property is being actively marketed at a reasonable sale price relative to its current fair value; and (vi) it is unlikely that the plan to sell will be withdrawn or that significant changes to the plan will be made.
In determining the fair value of the assets less cost to sell, we consider factors including current sales prices for comparable assets in the area, recent market analysis studies, appraisals and any recent legitimate offers. If the estimated fair value less cost to sell of an asset is less than its current carrying value, the asset is written down to its estimated fair value less cost to sell. The total carrying value of assets held for sale was $3.9 million and $4.6 million as of April 3, 2021 and December 31, 2020, respectively. Assets held for sale at April 3, 2021 are actively marketed for sale. During the three months ended April 3, 2021, the Company completed the sale of certain real property assets resulting in approximately $0.7 million in net proceeds and an immaterial loss from the transaction.
Due to uncertainties in the estimation process, actual results could differ from the estimates used in our historical analysis. Our assumptions about property sales prices require significant judgment because the current market is highly sensitive to changes in economic conditions. We determined the estimated fair values of assets held for sale based on current market conditions and assumptions made by management, which may differ from actual results and may result in impairments if market conditions deteriorate.
11


NOTE 9 — LEASES
The Company leases certain manufacturing, warehouse and distribution locations, vehicles and equipment, including fleet vehicles. Many of these leases have options to terminate prior to or extend beyond the end of the term. The exercise of the majority of lease renewal options is at the Company’s sole discretion. Some lease agreements have variable payments, the majority of these are real estate agreements in which future increases in rent are based on an index. Lease agreements do not contain any material residual value guarantees or material restrictive covenants. The Company accounts for lease and non-lease components as a single lease component for all leases other than leases of durable tooling. The Company excludes leases with an initial term of 12 months or less from the consolidated balance sheets and recognizes related lease payments in the consolidated statements of operations on a straight-line basis over the lease term.
Operating lease liabilities are recognized based on the present value of the future minimum lease payments over the reasonably expected holding period at commencement date. Few of the Company’s lease contracts provide a readily determinable implicit rate. For these contracts, an estimated incremental borrowing rate (“IBR”) is utilized, based on information available at the inception of the lease. The incremental borrowing rate represents an estimate of the interest rate we would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of the lease.
Accounting for leases may require judgment, including determining whether a contract contains a lease, the incremental borrowing rates to utilize for leases without a stated implicit rate, the reasonably certain holding period for a leased asset, and the allocation of consideration to lease and non-lease components. The allocation of the lease and non-lease components for leases of durable tooling is based on the Company’s best estimate of standalone price.
Weighted average information about the Company’s lease portfolio as of April 3, 2021 was as follows:
Weighted-average remaining lease term5.5 years
Weighted-average IBR6.01 %
Operating lease costs were as follows (in thousands):
Three Months Ended
April 3,
2021
April 4,
2020
Operating lease costs
Fixed lease costs$25,967 $27,930 
Variable lease costs(1)
24,726 19,588 
(1) Includes short-term lease costs, which are immaterial.
Cash and non-cash activities were as follows (in thousands):
Three Months Ended
April 3,
2021
April 4,
2020
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases$27,019 $30,274 
Right-of-use assets obtained in exchange for new operating lease liabilities$5,704 $4,261 
12


Future minimum lease payments under non-cancelable leases as of April 3, 2021 are as follows (in thousands):
Operating Leases
2021 (excluding the three months ended April 3, 2021)$59,841 
202272,420 
202346,441 
202435,189 
202528,257 
Thereafter69,702 
Total future minimum lease payments311,850 
Less: interest48,136 
Present value of future minimum lease payments$263,714 
As of April 3, 2021
Current portion of lease liabilities$69,042 
Long-term portion of lease liabilities194,672 
Total$263,714 

NOTE 10 — SHARE-BASED COMPENSATION
Our 2003 Long-Term Stock Incentive Plan, as amended (the “Incentive Plan”), is an equity-based compensation plan that allows us to grant a variety of types of awards, including stock options, restricted stock awards, stock appreciation rights, cash awards, phantom stock awards, restricted stock unit awards (“RSUs”) and long-term incentive awards with performance conditions (“performance share units” or “PSUs”). Awards are generally granted once per year, with the amounts and types of awards determined by the Compensation Committee of our Board of Directors (the “Committee”). In connection with the Merger (as defined herein) with Ply Gem Parent, LLC (“Ply Gem”), on November 16, 2018 awards were granted to certain senior executives and key employees (the “Founders Awards”), which included stock options, RSUs, and PSUs. A portion of the Founders Awards was not granted under the Incentive Plan but was instead granted pursuant to a separate equity-based compensation plan, the Long-Term Incentive Plan consisting of award agreements for select Founders Awards. However, these awards were subject to the same terms and provisions as awards of the same type granted under the Incentive Plan.
As of April 3, 2021, and for all periods presented, the Founders Awards and our share-based awards under the Incentive Plan have consisted of RSUs, PSUs and stock option grants, none of which can be settled through cash payments. Both our stock options and restricted stock awards are subject only to vesting requirements based on continued employment through the end of a specified time period and typically vest in annual increments over three to five years or earlier upon death, disability or a change in control. As a general rule, option awards expire on the earlier of (i) 10 years from the date of grant, (ii) 60 days after termination of employment or service for a reason other than death, disability or retirement, or (iii) 180 days after death, disability or retirement. Awards are non-transferable except by disposition on death or to certain family members, trusts and other family entities as the Committee may approve.
Our time-based restricted stock awards are typically subject to graded vesting over a service period, which is three to five years. Our performance-based and market-based restricted stock awards are typically subject to cliff vesting at the end of the service period, which is typically three years. Our share-based compensation arrangements are equity classified and we recognize compensation cost for these awards on a straight-line basis over the requisite service period for each award grant. In the case of performance-based awards, expense is recognized based upon management’s assessment of the probability that such performance conditions will be achieved. Certain of our awards provide for accelerated vesting upon a change of control or upon termination without cause or for good reason.
Vesting of the PSUs granted in the Founders Awards is contingent upon the achievement of synergies captured from the Merger and continued employment. Based on achieved synergies during the period comprising the two fiscal years ended December 31, 2020, the Founders Awards will vest at 200% of target amounts, subject to continuing employment through the requisite service period ending on November 16, 2021. Vesting of the PSUs granted during the three months ended April 3, 2021 and April 4, 2020 are contingent upon achievement of a cumulative three-year EBITDA growth target with an additional modifier based on total shareholder return. The grant-date fair value of the PSUs granted during the three months ended April 3, 2021 and April 4, 2020 were determined by a Monte Carlo simulation.
13


Stock option awards
During the three months ended April 3, 2021 and April 4, 2020, we granted 0.5 million and 1.0 million stock options, respectively. The average grant date fair value of options granted during the three months ended April 3, 2021 and April 4, 2020 was $6.50 and $1.96 per share, respectively. There were forty-four thousand options with an intrinsic value of $0.1 million exercised during the three months ended April 3, 2021. No options were exercised during the three months ended April 4, 2020.
Restricted stock units and performance share units
Annual awards to our key employees generally have a three-year performance period. The fair value of RSUs awarded is based on the Company’s stock price as of the date of grant. During the three months ended April 3, 2021, we granted RSUs to key employees with a fair value of $8.5 million representing approximately 0.6 million shares. During the three months ended April 4, 2020, we granted RSUs to key employees with a fair value of $4.3 million, representing 0.9 million shares. During the three months ended April 3, 2021 and April 4, 2020, we granted PSUs with a total fair value of approximately $13.7 million and $5.3 million, respectively, to key employees.
Share-based compensation expense
During the three months ended April 3, 2021 and April 4, 2020, we recorded share-based compensation expense for all awards of $3.3 million and $3.4 million, respectively.
NOTE 11 — EARNINGS PER COMMON SHARE
Basic earnings per common share is computed by dividing net income allocated to common shares by the weighted average number of common shares outstanding. Diluted earnings per common share, if applicable, considers the dilutive effect of common stock equivalents. The reconciliation of the numerator and denominator used for the computation of basic and diluted earnings per common share is as follows (in thousands, except per share data):
 Three Months Ended
 April 3,
2021
April 4,
2020
Numerator for Basic and Diluted Earnings Per Common Share
Net loss applicable to common shares