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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Apogee Enterprises Inc | NASDAQ:APOG | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
1.06 | 1.70% | 63.59 | 63.00 | 65.96 | 63.94 | 62.39 | 62.94 | 289,254 | 23:19:26 |
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x
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QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Minnesota
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41-0919654
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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4400 West 78
th
Street – Suite 520,
Minneapolis, MN
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55435
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
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x
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Accelerated filer
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o
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Non-accelerated filer
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o
(Do not check if a smaller reporting company)
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Smaller reporting company
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o
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Page
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PART I
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Item 1.
|
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Item 2.
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Item 3.
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Item 4.
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PART II
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Item 1.
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Item 1A.
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Item 2.
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Item 6.
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Item 1.
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Financial Statements
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(In thousands, except stock data)
|
|
August 27,
2016 |
|
February 27,
2016 |
||||
Assets
|
|
|
|
|
||||
Current assets
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
46,976
|
|
|
$
|
60,470
|
|
Short-term available for sale securities
|
|
30,665
|
|
|
30,173
|
|
||
Restricted cash
|
|
16,949
|
|
|
—
|
|
||
Receivables, net of allowance for doubtful accounts
|
|
187,996
|
|
|
172,832
|
|
||
Inventories
|
|
68,651
|
|
|
63,386
|
|
||
Deferred tax assets
|
|
—
|
|
|
1,820
|
|
||
Other current assets
|
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7,362
|
|
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8,112
|
|
||
Total current assets
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358,599
|
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336,793
|
|
||
Property, plant and equipment, net
|
|
218,261
|
|
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202,462
|
|
||
Available for sale securities
|
|
12,679
|
|
|
12,519
|
|
||
Goodwill
|
|
74,891
|
|
|
73,996
|
|
||
Intangible assets
|
|
19,950
|
|
|
19,862
|
|
||
Other non-current assets
|
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17,227
|
|
|
11,808
|
|
||
Total assets
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$
|
701,607
|
|
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$
|
657,440
|
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Liabilities and Shareholders’ Equity
|
|
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|
||||
Current liabilities
|
|
|
|
|
||||
Accounts payable
|
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$
|
61,288
|
|
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$
|
64,762
|
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Accrued payroll and related benefits
|
|
33,931
|
|
|
39,946
|
|
||
Accrued self-insurance reserves
|
|
8,404
|
|
|
7,818
|
|
||
Other current liabilities
|
|
29,688
|
|
|
29,339
|
|
||
Billings in excess of costs and earnings on uncompleted contracts
|
|
42,600
|
|
|
31,890
|
|
||
Accrued income taxes
|
|
1,605
|
|
|
3,626
|
|
||
Total current liabilities
|
|
177,516
|
|
|
177,381
|
|
||
Long-term debt
|
|
20,400
|
|
|
20,400
|
|
||
Long-term self-insurance reserves
|
|
8,788
|
|
|
7,137
|
|
||
Deferred tax liabilities
|
|
1,881
|
|
|
4,972
|
|
||
Other non-current liabilities
|
|
46,766
|
|
|
41,355
|
|
||
Commitments and contingent liabilities (Note 13)
|
|
|
|
|
||||
Shareholders’ equity
|
|
|
|
|
||||
Common stock of $0.33-1/3 par value; authorized 50,000,000 shares; issued and outstanding 28,896,439 and 28,683,948, respectively
|
|
9,632
|
|
|
9,561
|
|
||
Additional paid-in capital
|
|
149,956
|
|
|
145,528
|
|
||
Retained earnings
|
|
313,449
|
|
|
282,477
|
|
||
Common stock held in trust
|
|
(853
|
)
|
|
(837
|
)
|
||
Deferred compensation obligations
|
|
853
|
|
|
837
|
|
||
Accumulated other comprehensive loss
|
|
(26,781
|
)
|
|
(31,371
|
)
|
||
Total shareholders’ equity
|
|
446,256
|
|
|
406,195
|
|
||
Total liabilities and shareholders’ equity
|
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$
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701,607
|
|
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$
|
657,440
|
|
|
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Three Months Ended
|
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Six Months Ended
|
||||||||||||
(In thousands, except per share data)
|
|
August 27,
2016 |
|
August 29,
2015 |
|
August 27,
2016 |
|
August 29,
2015 |
||||||||
Net sales
|
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$
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278,455
|
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$
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240,754
|
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$
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526,335
|
|
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$
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480,716
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Cost of sales
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205,924
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184,055
|
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389,377
|
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368,429
|
|
||||
Gross profit
|
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72,531
|
|
|
56,699
|
|
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136,958
|
|
|
112,287
|
|
||||
Selling, general and administrative expenses
|
|
39,483
|
|
|
34,276
|
|
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77,661
|
|
|
71,640
|
|
||||
Operating income
|
|
33,048
|
|
|
22,423
|
|
|
59,297
|
|
|
40,647
|
|
||||
Interest income
|
|
252
|
|
|
267
|
|
|
528
|
|
|
504
|
|
||||
Interest expense
|
|
188
|
|
|
150
|
|
|
345
|
|
|
318
|
|
||||
Other income (expense), net
|
|
254
|
|
|
(93
|
)
|
|
509
|
|
|
(43
|
)
|
||||
Earnings before income taxes
|
|
33,366
|
|
|
22,447
|
|
|
59,989
|
|
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40,790
|
|
||||
Income tax expense
|
|
10,969
|
|
|
7,687
|
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19,870
|
|
|
13,904
|
|
||||
Net earnings
|
|
$
|
22,397
|
|
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$
|
14,760
|
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$
|
40,119
|
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$
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26,886
|
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||||||||
Earnings per share - basic
|
|
$
|
0.78
|
|
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$
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0.51
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$
|
1.39
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$
|
0.92
|
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Earnings per share - diluted
|
|
$
|
0.77
|
|
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$
|
0.50
|
|
|
$
|
1.39
|
|
|
$
|
0.91
|
|
Weighted average basic shares outstanding
|
|
28,891
|
|
|
29,187
|
|
|
28,797
|
|
|
29,116
|
|
||||
Weighted average diluted shares outstanding
|
|
28,963
|
|
|
29,492
|
|
|
28,932
|
|
|
29,486
|
|
|
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Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(In thousands)
|
|
August 27,
2016 |
|
August 29,
2015 |
|
August 27,
2016 |
|
August 29,
2015 |
||||||||
Net earnings
|
|
$
|
22,397
|
|
|
$
|
14,760
|
|
|
$
|
40,119
|
|
|
$
|
26,886
|
|
Other comprehensive earnings (loss):
|
|
|
|
|
|
|
|
|
||||||||
Unrealized gain (loss) on marketable securities, net of $43, $-, $35 and $(33) of tax expense (benefit), respectively
|
|
79
|
|
|
—
|
|
|
65
|
|
|
(63
|
)
|
||||
Foreign currency translation adjustments
|
|
1,632
|
|
|
(2,140
|
)
|
|
4,525
|
|
|
(5,151
|
)
|
||||
Other comprehensive earnings (loss)
|
|
1,711
|
|
|
(2,140
|
)
|
|
4,590
|
|
|
(5,214
|
)
|
||||
Total comprehensive earnings
|
|
$
|
24,108
|
|
|
$
|
12,620
|
|
|
$
|
44,709
|
|
|
$
|
21,672
|
|
|
|
Six Months Ended
|
||||||
(In thousands)
|
|
August 27, 2016
|
|
August 29, 2015
|
||||
Operating Activities
|
|
|
|
|
||||
Net earnings
|
|
$
|
40,119
|
|
|
$
|
26,886
|
|
Adjustments to reconcile net earnings to net cash provided by operating activities:
|
|
|
|
|
||||
Depreciation and amortization
|
|
15,955
|
|
|
15,502
|
|
||
Stock-based compensation
|
|
2,935
|
|
|
2,414
|
|
||
Deferred income taxes
|
|
(1,320
|
)
|
|
(2,252
|
)
|
||
Excess tax benefits from share-based compensation
|
|
(2,334
|
)
|
|
(4,699
|
)
|
||
Gain on disposal of assets
|
|
(183
|
)
|
|
(231
|
)
|
||
Proceeds from New Markets Tax Credit transaction, net of deferred costs
|
|
5,109
|
|
|
—
|
|
||
Other, net
|
|
(1,424
|
)
|
|
549
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
||||
Receivables
|
|
(14,297
|
)
|
|
19,898
|
|
||
Inventories
|
|
(4,876
|
)
|
|
1,273
|
|
||
Accounts payable and accrued expenses
|
|
(7,511
|
)
|
|
(12,716
|
)
|
||
Billings in excess of costs and earnings on uncompleted contracts
|
|
10,711
|
|
|
3,164
|
|
||
Refundable and accrued income taxes
|
|
(1,310
|
)
|
|
13,064
|
|
||
Other, net
|
|
(366
|
)
|
|
(754
|
)
|
||
Net cash provided by operating activities
|
|
41,208
|
|
|
62,098
|
|
||
Investing Activities
|
|
|
|
|
||||
Capital expenditures
|
|
(31,474
|
)
|
|
(19,366
|
)
|
||
Proceeds from sales of property, plant and equipment
|
|
1,713
|
|
|
—
|
|
||
Change in restricted cash
|
|
(16,949
|
)
|
|
—
|
|
||
Purchases of marketable securities
|
|
(2,845
|
)
|
|
(56,918
|
)
|
||
Sales/maturities of marketable securities
|
|
2,294
|
|
|
3,684
|
|
||
Other, net
|
|
(2,044
|
)
|
|
(892
|
)
|
||
Net cash used in investing activities
|
|
(49,305
|
)
|
|
(73,492
|
)
|
||
Financing Activities
|
|
|
|
|
||||
(Repayments) borrowings on line of credit, net
|
|
(16
|
)
|
|
968
|
|
||
Shares withheld for taxes, net of stock issued to employees
|
|
(956
|
)
|
|
(3,178
|
)
|
||
Excess tax benefits from share-based compensation
|
|
2,334
|
|
|
4,699
|
|
||
Dividends paid
|
|
(7,133
|
)
|
|
(6,431
|
)
|
||
Net cash used in financing activities
|
|
(5,771
|
)
|
|
(3,942
|
)
|
||
Decrease in cash and cash equivalents
|
|
(13,868
|
)
|
|
(15,336
|
)
|
||
Effect of exchange rates on cash
|
|
374
|
|
|
(659
|
)
|
||
Cash and cash equivalents at beginning of year
|
|
60,470
|
|
|
52,185
|
|
||
Cash and cash equivalents at end of period
|
|
$
|
46,976
|
|
|
$
|
36,190
|
|
Noncash Activity
|
|
|
|
|
||||
Capital expenditures in accounts payable
|
|
$
|
2,520
|
|
|
$
|
1,014
|
|
(In thousands)
|
|
Common Shares Outstanding
|
|
Common Stock
|
|
Additional Paid-In Capital
|
|
Retained Earnings
|
|
Common Stock Held in Trust
|
|
Deferred Compensation Obligation
|
|
Accumulated Other Comprehensive (Loss) Income
|
|||||||||||||
Balance at February 27, 2016
|
|
28,684
|
|
|
$
|
9,561
|
|
|
$
|
145,528
|
|
|
$
|
282,477
|
|
|
$
|
(837
|
)
|
|
$
|
837
|
|
|
$
|
(31,371
|
)
|
Net earnings
|
|
—
|
|
|
—
|
|
|
—
|
|
|
40,119
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Unrealized gain on marketable securities, net of $35 tax expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
65
|
|
||||||
Foreign currency translation adjustments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,525
|
|
||||||
Issuance of stock, net of cancellations
|
|
139
|
|
|
46
|
|
|
49
|
|
|
—
|
|
|
(16
|
)
|
|
16
|
|
|
—
|
|
||||||
Share-based compensation
|
|
—
|
|
|
—
|
|
|
2,935
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Tax benefit associated with stock plans
|
|
—
|
|
|
—
|
|
|
506
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Exercise of stock options
|
|
125
|
|
|
42
|
|
|
1,211
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Other share retirements
|
|
(52
|
)
|
|
(17
|
)
|
|
(273
|
)
|
|
(2,014
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Cash dividends
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,133
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Balance at August 27, 2016
|
|
28,896
|
|
|
$
|
9,632
|
|
|
$
|
149,956
|
|
|
$
|
313,449
|
|
|
$
|
(853
|
)
|
|
$
|
853
|
|
|
$
|
(26,781
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Balance at February 28, 2015
|
|
29,050
|
|
|
$
|
9,683
|
|
|
$
|
138,575
|
|
|
$
|
256,538
|
|
|
$
|
(801
|
)
|
|
$
|
801
|
|
|
$
|
(22,320
|
)
|
Net earnings
|
|
—
|
|
|
—
|
|
|
—
|
|
|
26,886
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Unrealized loss on marketable securities, net of $33 tax benefit
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(63
|
)
|
||||||
Foreign currency translation adjustments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,151
|
)
|
||||||
Issuance of stock, net of cancellations
|
|
101
|
|
|
34
|
|
|
(67
|
)
|
|
—
|
|
|
(18
|
)
|
|
18
|
|
|
—
|
|
||||||
Share-based compensation
|
|
—
|
|
|
—
|
|
|
2,414
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Tax benefit associated with stock plans
|
|
—
|
|
|
—
|
|
|
4,858
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Exercise of stock options
|
|
177
|
|
|
59
|
|
|
1,322
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Share repurchases
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Other share retirements
|
|
(88
|
)
|
|
(29
|
)
|
|
(438
|
)
|
|
(4,228
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Cash dividends
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,431
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Balance at August 29, 2015
|
|
29,240
|
|
|
$
|
9,747
|
|
|
$
|
146,664
|
|
|
$
|
272,765
|
|
|
$
|
(819
|
)
|
|
$
|
819
|
|
|
$
|
(27,534
|
)
|
1.
|
Basis of Presentation
|
2.
|
New Accounting Standards
|
3.
|
Share-Based Compensation
|
Stock Options and SARs
|
|
Number of
Shares
|
|
Weighted
Average
Exercise Price
|
|
Weighted
Average
Remaining
Contractual
Life
|
|
Aggregate
Intrinsic
Value
|
|||||
Outstanding at February 27, 2016
|
|
403,714
|
|
|
$
|
11.81
|
|
|
|
|
|
||
Awards exercised
|
|
(128,387
|
)
|
|
10.77
|
|
|
|
|
|
|||
Outstanding and exercisable at August 27, 2016
|
|
275,327
|
|
|
$
|
12.30
|
|
|
4.0 Years
|
|
$
|
9,820,887
|
|
Nonvested Shares and Units
|
|
Number of
Shares and
Units
|
|
Weighted
Average
Grant Date
Fair Value
|
|||
Nonvested at February 27, 2016
|
|
275,457
|
|
|
$
|
37.48
|
|
Granted
|
|
148,372
|
|
|
42.89
|
|
|
Vested
|
|
(140,404
|
)
|
|
28.43
|
|
|
Canceled
|
|
(500
|
)
|
|
41.44
|
|
|
Nonvested at August 27, 2016
|
|
282,925
|
|
|
$
|
44.80
|
|
4.
|
Earnings per Share
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||
(In thousands)
|
August 27,
2016 |
|
August 29,
2015 |
|
August 27,
2016 |
|
August 29,
2015 |
||||
Basic earnings per share – weighted average common shares outstanding
|
28,891
|
|
|
29,187
|
|
|
28,797
|
|
|
29,116
|
|
Weighted average effect of nonvested share grants and assumed exercise of stock options
|
72
|
|
|
305
|
|
|
135
|
|
|
370
|
|
Diluted earnings per share – weighted average common shares and potential
common shares outstanding
|
28,963
|
|
|
29,492
|
|
|
28,932
|
|
|
29,486
|
|
5.
|
Inventories
|
(In thousands)
|
August 27, 2016
|
|
February 27, 2016
|
||||
Raw materials
|
$
|
24,246
|
|
|
$
|
21,404
|
|
Work-in-process
|
13,111
|
|
|
9,958
|
|
||
Finished goods
|
26,091
|
|
|
25,486
|
|
||
Costs and earnings in excess of billings on uncompleted contracts
|
5,203
|
|
|
6,538
|
|
||
Total inventories
|
$
|
68,651
|
|
|
$
|
63,386
|
|
6.
|
Marketable Securities
|
(In thousands)
|
Amortized Cost
|
|
Gross Unrealized Gains
|
|
Gross Unrealized Losses
|
|
Estimated
Fair Value
|
||||||||
August 27, 2016
|
|
|
|
|
|
|
|
||||||||
Mutual fund
|
$
|
30,290
|
|
|
$
|
—
|
|
|
$
|
(55
|
)
|
|
$
|
30,235
|
|
Municipal bonds
|
12,835
|
|
|
349
|
|
|
(75
|
)
|
|
13,109
|
|
||||
Total marketable securities
|
$
|
43,125
|
|
|
$
|
349
|
|
|
$
|
(130
|
)
|
|
$
|
43,344
|
|
|
|
|
|
|
|
|
|
||||||||
February 27, 2016
|
|
|
|
|
|
|
|
||||||||
Mutual fund
|
$
|
30,178
|
|
|
$
|
—
|
|
|
$
|
(55
|
)
|
|
$
|
30,123
|
|
Municipal bonds
|
12,393
|
|
|
285
|
|
|
(109
|
)
|
|
12,569
|
|
||||
Total marketable securities
|
$
|
42,571
|
|
|
$
|
285
|
|
|
$
|
(164
|
)
|
|
$
|
42,692
|
|
(In thousands)
|
Amortized Cost
|
|
Estimated Fair Value
|
||||
Due within one year
|
$
|
431
|
|
|
$
|
430
|
|
Due after one year through five years
|
4,939
|
|
|
5,013
|
|
||
Due after five years through 10 years
|
6,173
|
|
|
6,446
|
|
||
Due after 10 years through 15 years
|
1,292
|
|
|
1,220
|
|
||
Total
|
$
|
12,835
|
|
|
$
|
13,109
|
|
7.
|
Fair Value Measurements
|
(In thousands)
|
Quoted Prices in
Active Markets
(Level 1)
|
|
Other
Observable
Inputs
(Level 2)
|
|
Total Fair
Value
|
||||||
August 27, 2016
|
|
|
|
|
|
||||||
Cash equivalents
|
|
|
|
|
|
||||||
Money market funds
|
$
|
8,655
|
|
|
$
|
—
|
|
|
$
|
8,655
|
|
Commercial paper
|
—
|
|
|
20,098
|
|
|
20,098
|
|
|||
Total cash equivalents
|
8,655
|
|
|
20,098
|
|
|
28,753
|
|
|||
Short-term securities
|
|
|
|
|
|
||||||
Mutual funds
|
30,235
|
|
|
—
|
|
|
30,235
|
|
|||
Municipal bonds
|
—
|
|
|
430
|
|
|
430
|
|
|||
Total short-term securities
|
30,235
|
|
|
430
|
|
|
30,665
|
|
|||
Long-term securities
|
|
|
|
|
|
||||||
Municipal bonds
|
—
|
|
|
12,679
|
|
|
12,679
|
|
|||
Total assets at fair value
|
$
|
38,890
|
|
|
$
|
33,207
|
|
|
$
|
72,097
|
|
February 27, 2016
|
|
|
|
|
|
||||||
Cash equivalents
|
|
|
|
|
|
||||||
Money market funds
|
$
|
23,199
|
|
|
$
|
—
|
|
|
$
|
23,199
|
|
Commercial paper
|
—
|
|
|
29,774
|
|
|
29,774
|
|
|||
Total cash equivalents
|
23,199
|
|
|
29,774
|
|
|
52,973
|
|
|||
Short-term securities
|
|
|
|
|
|
||||||
Mutual funds
|
30,123
|
|
|
—
|
|
|
30,123
|
|
|||
Municipal bonds
|
—
|
|
|
50
|
|
|
50
|
|
|||
Total short-term securities
|
30,123
|
|
|
50
|
|
|
30,173
|
|
|||
Long-term securities
|
|
|
|
|
|
||||||
Municipal bonds
|
—
|
|
|
12,519
|
|
|
12,519
|
|
|||
Total assets at fair value
|
$
|
53,322
|
|
|
$
|
42,343
|
|
|
$
|
95,665
|
|
8.
|
Goodwill and Other Identifiable Intangible Assets
|
(In thousands)
|
Architectural Glass
|
|
Architectural Services
|
|
Architectural Framing Systems
|
|
Large-Scale
Optical
|
|
Total
|
||||||||||
Balance at February 28, 2015
|
$
|
26,355
|
|
|
$
|
1,120
|
|
|
$
|
37,825
|
|
|
$
|
10,557
|
|
|
$
|
75,857
|
|
Foreign currency translation
|
(716
|
)
|
|
—
|
|
|
(1,145
|
)
|
|
—
|
|
|
(1,861
|
)
|
|||||
Balance at February 27, 2016
|
25,639
|
|
|
1,120
|
|
|
36,680
|
|
|
10,557
|
|
|
73,996
|
|
|||||
Foreign currency translation
|
347
|
|
|
—
|
|
|
548
|
|
|
—
|
|
|
895
|
|
|||||
Balance at August 27, 2016
|
$
|
25,986
|
|
|
$
|
1,120
|
|
|
$
|
37,228
|
|
|
$
|
10,557
|
|
|
$
|
74,891
|
|
(In thousands)
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Foreign
Currency
Translation
|
|
Net
|
||||||||
August 27, 2016
|
|
|
|
|
|
|
|
|
||||||||
Definite-lived intangible assets:
|
|
|
|
|
|
|
|
|
||||||||
Debt issue costs on revolving credit facility
|
|
$
|
3,681
|
|
|
$
|
(2,857
|
)
|
|
$
|
—
|
|
|
$
|
824
|
|
Non-compete agreements
|
|
6,524
|
|
|
(6,307
|
)
|
|
—
|
|
|
217
|
|
||||
Customer relationships
|
|
22,636
|
|
|
(12,814
|
)
|
|
525
|
|
|
10,347
|
|
||||
Purchased intellectual property
|
|
7,656
|
|
|
(3,362
|
)
|
|
196
|
|
|
4,490
|
|
||||
Total definite-lived intangible assets
|
|
$
|
40,497
|
|
|
$
|
(25,340
|
)
|
|
$
|
721
|
|
|
$
|
15,878
|
|
Indefinite-lived intangible assets:
|
|
|
|
|
|
|
|
|
||||||||
Trademarks
|
|
3,919
|
|
|
—
|
|
|
153
|
|
|
4,072
|
|
||||
Total intangible assets
|
|
$
|
44,416
|
|
|
$
|
(25,340
|
)
|
|
$
|
874
|
|
|
$
|
19,950
|
|
February 27, 2016
|
|
|
|
|
|
|
|
|
||||||||
Definite-lived intangible assets:
|
|
|
|
|
|
|
|
|
||||||||
Debt issue costs on revolving credit facility
|
|
$
|
3,677
|
|
|
$
|
(2,758
|
)
|
|
$
|
—
|
|
|
$
|
919
|
|
Non-compete agreements
|
|
6,673
|
|
|
(6,419
|
)
|
|
(16
|
)
|
|
238
|
|
||||
Customer relationships
|
|
24,174
|
|
|
(12,737
|
)
|
|
(1,162
|
)
|
|
10,275
|
|
||||
Purchased intellectual property
|
|
8,213
|
|
|
(3,271
|
)
|
|
(431
|
)
|
|
4,511
|
|
||||
Total definite-lived intangible assets
|
|
$
|
42,737
|
|
|
$
|
(25,185
|
)
|
|
$
|
(1,609
|
)
|
|
$
|
15,943
|
|
Indefinite-lived intangible assets:
|
|
|
|
|
|
|
|
|
||||||||
Trademarks
|
|
4,239
|
|
|
—
|
|
|
(320
|
)
|
|
3,919
|
|
||||
Total intangible assets
|
|
$
|
46,976
|
|
|
$
|
(25,185
|
)
|
|
$
|
(1,929
|
)
|
|
$
|
19,862
|
|
(In thousands)
|
Remainder
of Fiscal
2017
|
|
Fiscal
2018
|
|
Fiscal
2019
|
|
Fiscal
2020
|
|
Fiscal
2021
|
||||||||||
Estimated amortization expense
|
$
|
795
|
|
|
$
|
1,522
|
|
|
$
|
1,462
|
|
|
$
|
1,351
|
|
|
$
|
1,164
|
|
9.
|
Debt
|
10.
|
Employee Benefit Plans
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(In thousands)
|
August 27,
2016 |
|
August 29,
2015 |
|
August 27,
2016 |
|
August 29,
2015 |
||||||||
Interest cost
|
$
|
139
|
|
|
$
|
142
|
|
|
$
|
278
|
|
|
$
|
284
|
|
Expected return on assets
|
(10
|
)
|
|
(34
|
)
|
|
(20
|
)
|
|
(68
|
)
|
||||
Amortization of unrecognized net loss
|
56
|
|
|
62
|
|
|
112
|
|
|
124
|
|
||||
Net periodic benefit cost
|
$
|
185
|
|
|
$
|
170
|
|
|
$
|
370
|
|
|
$
|
340
|
|
11.
|
Income Taxes
|
12.
|
Other Non-Current Liabilities
|
(In thousands)
|
August 27, 2016
|
|
February 27, 2016
|
||||
Deferred benefit from New Market Tax Credit transactions
|
$
|
16,708
|
|
|
$
|
10,741
|
|
Retirement plan obligations
|
9,992
|
|
|
9,992
|
|
||
Deferred compensation plan
|
7,106
|
|
|
4,814
|
|
||
Other
|
12,960
|
|
|
15,808
|
|
||
Total other non-current liabilities
|
$
|
46,766
|
|
|
$
|
41,355
|
|
13.
|
Commitments and Contingent Liabilities
|
(In thousands)
|
Remainder of Fiscal 2017
|
|
Fiscal 2018
|
|
Fiscal 2019
|
|
Fiscal 2020
|
|
Fiscal 2021
|
|
Thereafter
|
|
Total
|
||||||||||||||
Total minimum payments
|
$
|
4,904
|
|
|
$
|
8,572
|
|
|
$
|
7,869
|
|
|
$
|
6,484
|
|
|
$
|
3,993
|
|
|
$
|
4,984
|
|
|
$
|
36,806
|
|
|
Six Months Ended
|
||||||
(In thousands)
|
August 27, 2016
|
|
August 29, 2015
|
||||
Balance at beginning of period
|
$
|
16,340
|
|
|
$
|
11,275
|
|
Additional accruals
|
2,577
|
|
|
3,205
|
|
||
Claims paid
|
(3,014
|
)
|
|
(2,266
|
)
|
||
Balance at end of period
|
$
|
15,903
|
|
|
$
|
12,214
|
|
14.
|
Segment Information
|
•
|
The Architectural Glass segment fabricates coated, high-performance glass used in customized window and wall systems comprising the outside skin of commercial, institutional and high-end multi-family residential buildings.
|
•
|
The Architectural Services segment designs, engineers, fabricates and installs the walls of glass, windows and other curtainwall products making up the outside skin of commercial and institutional buildings.
|
•
|
The Architectural Framing Systems segment designs, engineers, fabricates and finishes the aluminum frames used in customized aluminum and glass window, curtainwall, storefront and entrance systems comprising the outside skin and entrances of commercial, institutional and high-end multi-family residential buildings. The Company has aggregated
four
operating segments into this reporting segment based on their similar products, customers, distribution methods, production processes and economic characteristics.
|
•
|
The LSO segment fabricates value-added glass and acrylic products for the picture framing, fine art, wall decor and display markets.
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(In thousands)
|
August 27,
2016 |
|
August 29,
2015 |
|
August 27,
2016 |
|
August 29,
2015 |
||||||||
Net sales from operations
|
|
|
|
|
|
|
|
||||||||
Architectural Glass
|
$
|
99,205
|
|
|
$
|
92,433
|
|
|
$
|
192,565
|
|
|
$
|
193,608
|
|
Architectural Services
|
77,734
|
|
|
52,197
|
|
|
140,554
|
|
|
107,849
|
|
||||
Architectural Framing Systems
|
92,229
|
|
|
80,671
|
|
|
173,362
|
|
|
152,571
|
|
||||
Large-Scale Optical
|
21,270
|
|
|
22,444
|
|
|
41,298
|
|
|
42,663
|
|
||||
Intersegment eliminations
|
(11,983
|
)
|
|
(6,991
|
)
|
|
(21,444
|
)
|
|
(15,975
|
)
|
||||
Net sales
|
$
|
278,455
|
|
|
$
|
240,754
|
|
|
$
|
526,335
|
|
|
$
|
480,716
|
|
Operating income (loss) from operations
|
|
|
|
|
|
|
|
||||||||
Architectural Glass
|
$
|
9,616
|
|
|
$
|
6,738
|
|
|
$
|
19,147
|
|
|
$
|
15,021
|
|
Architectural Services
|
6,236
|
|
|
1,419
|
|
|
9,418
|
|
|
2,361
|
|
||||
Architectural Framing Systems
|
13,001
|
|
|
9,692
|
|
|
23,232
|
|
|
14,953
|
|
||||
Large-Scale Optical
|
5,051
|
|
|
5,642
|
|
|
9,703
|
|
|
10,512
|
|
||||
Corporate and other
|
(856
|
)
|
|
(1,068
|
)
|
|
(2,203
|
)
|
|
(2,200
|
)
|
||||
Operating income
|
$
|
33,048
|
|
|
$
|
22,423
|
|
|
$
|
59,297
|
|
|
$
|
40,647
|
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||
(Percent of net sales)
|
August 27,
2016 |
|
August 29,
2015 |
|
August 27,
2016 |
|
August 29,
2015 |
||||
Net sales
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
Cost of sales
|
74.0
|
|
|
76.4
|
|
|
74.0
|
|
|
76.6
|
|
Gross profit
|
26.0
|
|
|
23.6
|
|
|
26.0
|
|
|
23.4
|
|
Selling, general and administrative expenses
|
14.2
|
|
|
14.2
|
|
|
14.8
|
|
|
14.9
|
|
Operating income
|
11.9
|
|
|
9.4
|
|
|
11.2
|
|
|
8.5
|
|
Interest income
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
Interest expense
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
Other income, net
|
0.1
|
|
|
—
|
|
|
0.1
|
|
|
—
|
|
Earnings before income taxes
|
12.0
|
|
|
9.4
|
|
|
11.3
|
|
|
8.5
|
|
Income tax expense
|
3.9
|
|
|
3.3
|
|
|
3.8
|
|
|
2.9
|
|
Net earnings
|
8.0
|
%
|
|
6.1
|
%
|
|
7.5
|
%
|
|
5.6
|
%
|
Effective tax rate
|
32.9
|
%
|
|
34.2
|
%
|
|
33.1
|
%
|
|
34.1
|
%
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||||||||
(In thousands)
|
August 27, 2016
|
|
August 29, 2015
|
|
%
Change
|
|
August 27, 2016
|
|
August 29, 2015
|
|
%
Change
|
||||||||||
Net sales
|
$
|
99,205
|
|
|
$
|
92,433
|
|
|
7.3
|
%
|
|
$
|
192,565
|
|
|
$
|
193,608
|
|
|
(0.5
|
)%
|
Operating income
|
9,616
|
|
|
6,738
|
|
|
42.7
|
%
|
|
19,147
|
|
|
15,021
|
|
|
27.5
|
%
|
||||
Operating margin
|
9.7
|
%
|
|
7.3
|
%
|
|
|
|
9.9
|
%
|
|
7.8
|
%
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||||||||
(In thousands)
|
August 27,
2016 |
|
August 29,
2015 |
|
%
Change
|
|
August 27,
2016 |
|
August 29,
2015 |
|
%
Change
|
||||||||||
Net sales
|
$
|
77,734
|
|
|
$
|
52,197
|
|
|
48.9
|
%
|
|
$
|
140,554
|
|
|
$
|
107,849
|
|
|
30.3
|
%
|
Operating income
|
6,236
|
|
|
1,419
|
|
|
339.5
|
%
|
|
9,418
|
|
|
2,361
|
|
|
298.9
|
%
|
||||
Operating margin
|
8.0
|
%
|
|
2.7
|
%
|
|
|
|
6.7
|
%
|
|
2.2
|
%
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||||||||
(In thousands)
|
August 27, 2016
|
|
August 29, 2015
|
|
%
Change
|
|
August 27, 2016
|
|
August 29, 2015
|
|
%
Change
|
||||||||||
Net sales
|
$
|
92,229
|
|
|
$
|
80,671
|
|
|
14.3
|
%
|
|
$
|
173,362
|
|
|
$
|
152,571
|
|
|
13.6
|
%
|
Operating income
|
13,001
|
|
|
9,692
|
|
|
34.1
|
%
|
|
23,232
|
|
|
14,953
|
|
|
55.4
|
%
|
||||
Operating margin
|
14.1
|
%
|
|
12.0
|
%
|
|
|
|
13.4
|
%
|
|
9.8
|
%
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||||||||
(In thousands)
|
August 27, 2016
|
|
August 29, 2015
|
|
%
Change
|
|
August 27, 2016
|
|
August 29, 2015
|
|
%
Change
|
||||||||||
Net sales
|
$
|
21,270
|
|
|
$
|
22,444
|
|
|
(5.2
|
)%
|
|
$
|
41,298
|
|
|
$
|
42,663
|
|
|
(3.2
|
)%
|
Operating income
|
5,051
|
|
|
5,642
|
|
|
(10.5
|
)%
|
|
9,703
|
|
|
10,512
|
|
|
(7.7
|
)%
|
||||
Operating margin
|
23.7
|
%
|
|
25.1
|
%
|
|
|
|
23.5
|
%
|
|
24.6
|
%
|
|
|
(In thousands)
|
August 27, 2016
|
|
February 27, 2016
|
|
August 29, 2015
|
||||||
Architectural Glass
|
$
|
90,736
|
|
|
$
|
71,798
|
|
|
$
|
83,941
|
|
Architectural Services
|
236,075
|
|
|
320,351
|
|
|
348,814
|
|
|||
Architectural Framing Systems
|
130,464
|
|
|
123,027
|
|
|
86,537
|
|
|||
Large-Scale Optical
|
1,570
|
|
|
2,278
|
|
|
2,075
|
|
|||
Intersegment eliminations
|
(11,195
|
)
|
|
(9,438
|
)
|
|
(9,477
|
)
|
|||
Total Backlog
|
$
|
447,650
|
|
|
$
|
508,016
|
|
|
$
|
511,890
|
|
Selected cash flow data
|
Six Months Ended
|
||||||
(In thousands)
|
August 27, 2016
|
|
August 29, 2015
|
||||
Operating Activities
|
|
|
|
||||
Net cash provided by operating activities
|
$
|
41,208
|
|
|
$
|
62,098
|
|
Investing Activities
|
|
|
|
||||
Capital expenditures
|
(31,474
|
)
|
|
(19,366
|
)
|
||
Change in restricted cash
|
(16,949
|
)
|
|
—
|
|
||
Net purchases of marketable securities
|
(551
|
)
|
|
(53,234
|
)
|
||
Financing Activities
|
|
|
|
||||
Dividends paid
|
(7,133
|
)
|
|
(6,431
|
)
|
|
Payments Due by Fiscal Period
|
||||||||||||||||||||||||||
(In thousands)
|
Fiscal 2017 Remaining
|
|
Fiscal 2018
|
|
Fiscal 2019
|
|
Fiscal 2020
|
|
Fiscal 2021
|
|
Thereafter
|
|
Total
|
||||||||||||||
Long-term debt obligations
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5,400
|
|
|
$
|
15,000
|
|
|
$
|
20,400
|
|
Operating leases (undiscounted)
|
4,904
|
|
|
8,572
|
|
|
7,869
|
|
|
6,484
|
|
|
3,993
|
|
|
4,984
|
|
|
36,806
|
|
|||||||
Purchase obligations
|
111,717
|
|
|
49,324
|
|
|
571
|
|
|
197
|
|
|
—
|
|
|
—
|
|
|
161,809
|
|
|||||||
Total cash obligations
|
$
|
116,621
|
|
|
$
|
57,896
|
|
|
$
|
8,440
|
|
|
$
|
6,681
|
|
|
$
|
9,393
|
|
|
$
|
19,984
|
|
|
$
|
219,015
|
|
|
Amount of Commitment Expiration Per Fiscal Period
|
||||||||||||||||||||||||||
(In thousands)
|
2017 Remaining
|
|
2018
|
|
2019
|
|
2020
|
|
2021
|
|
Thereafter
|
|
Total
|
||||||||||||||
Standby letters of credit
|
$
|
—
|
|
|
$
|
20,982
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,500
|
|
|
$
|
23,482
|
|
•
|
Revenue growth of approximately 10 percent over fiscal 2016.
|
•
|
Gross margin of approximately 26.5 percent and operating margin of approximately 11.3 percent.
|
•
|
Earnings per share of $2.80 to $2.90.
|
•
|
Capital expenditures of approximately $70 million.
|
Item 3.
|
Quantitative and Qualitative Disclosures About Market Risk
|
Item 4.
|
Controls and Procedures
|
a)
|
Evaluation of Disclosure Controls and Procedures. As of the end of the period covered by this report (the Evaluation Date), we carried out an evaluation, under the supervision and with the participation of management, including the Chief Executive Officer and the Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) of the Securities Exchange Act of 1934, as amended (the Exchange Act)). Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that, as of the Evaluation Date, our disclosure controls and procedures were effective to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in applicable rules and forms, and (ii) accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.
|
b)
|
Changes in internal controls: There was no change in the Company’s internal control over financial reporting that occurred during the fiscal quarter ended
August 27, 2016
, that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.
|
Item 1.
|
Legal Proceedings
|
Item 1A.
|
Risk Factors
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
Period
|
|
Total Number
of Shares
Purchased (a)
|
|
Average Price
Paid per Share
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (b)
|
|
Maximum
Number of
Shares that May
Yet Be
Purchased
under the Plans
or Programs (b)
|
|||||
May 29, 2016 through June 25, 2016
|
|
3,800
|
|
|
$
|
43.69
|
|
|
—
|
|
|
1,192,368
|
|
June 26, 2016 through July 23, 2016
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,192,368
|
|
|
July 24, 2016 through August 27, 2016
|
|
16,497
|
|
|
47.44
|
|
|
—
|
|
|
1,192,368
|
|
|
Total
|
|
20,297
|
|
|
$
|
46.19
|
|
|
—
|
|
|
1,192,368
|
|
(a)
|
The shares in this column represent shares that were surrendered to us by plan participants to satisfy stock-for-stock option exercises or withholding tax obligations related to share-based compensation.
|
(b)
|
In fiscal 2004, the Board of Directors authorized the repurchase of 1,500,000 shares of Company stock, which was announced on April 10, 2003. Subsequently, the Board of Directors increased the authorization by 750,000 shares, which was announced on January 24, 2008; by 1,000,000 shares, which was announced on October 8, 2008; and by 1,000,000 shares, which was announced on January 13, 2016. The repurchase program does not have an expiration date.
|
Item 6.
|
Exhibits
|
10.1
|
First Amendment to Apogee Enterprises, Inc. 2016 Executive Management Incentive Plan. Incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K/A filed on August 10, 2016.
|
|
|
31.1
|
Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.
|
|
|
31.2
|
Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.
|
|
|
32.1
|
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
32.2
|
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
101
|
The following materials from Apogee Enterprises, Inc.’s Quarterly Report on Form 10-Q for the quarter ended August 27, 2016 are furnished herewith, formatted in XBRL (Extensible Business Reporting Language): (i) the Consolidated Balance Sheets as of August 27, 2016 and February 27, 2016, (ii) the Consolidated Results of Operations for the three and six months ended August 27, 2016 and August 29, 2015, (iii) the Consolidated Statements of Comprehensive Earnings for the three and six months ended August 27, 2016 and August 29, 2015, (iv) the Consolidated Statements of Cash Flows for the six months ended August 27, 2016 and August 29, 2015, (v) the Consolidated Statements of Shareholders' Equity for the six months ended August 27, 2016 and August 29, 2015, and (vi) Notes to Consolidated Financial Statements.
|
|
|
APOGEE ENTERPRISES, INC.
|
|
|
|
|
|
Date: October 6, 2016
|
|
By: /s/ Joseph F. Puishys
|
|
|
|
|
Joseph F. Puishys
President and Chief
Executive Officer
(Principal Executive Officer)
|
Date: October 6, 2016
|
|
By: /s/ James S. Porter
|
|
|
|
|
James S. Porter
Executive Vice President and
Chief Financial Officer (Principal Financial and
Accounting Officer)
|
10.1
|
First Amendment to Apogee Enterprises, Inc. 2016 Executive Management Incentive Plan. Incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K/A filed on August 10, 2016.
|
|
|
31.1
|
Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.
|
|
|
31.2
|
Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.
|
|
|
32.1
|
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
32.2
|
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
101
|
The following materials from Apogee Enterprises, Inc.’s Quarterly Report on Form 10-Q for the quarter ended August 27, 2016 are furnished herewith, formatted in XBRL (Extensible Business Reporting Language): (i) the Consolidated Balance Sheets as of August 27, 2016 and February 27, 2016, (ii) the Consolidated Results of Operations for the three and six months ended August 27, 2016 and August 29, 2015, (iii) the Consolidated Statements of Comprehensive Earnings for the three and six months ended August 27, 2016 and August 29, 2015, (iv) the Consolidated Statements of Cash Flows for the six months ended August 27, 2016 and August 29, 2015, (v) the Consolidated Statements of Shareholders' Equity for the six months ended August 27, 2016 and August 29, 2015, and (vi) Notes to Consolidated Financial Statements.
|
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