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Table of Contents

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 28, 2020

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number 0-22684

UFP INDUSTRIES, INC.

(Exact name of registrant as specified in its charter)

Michigan

    

38-1465835

(State or other jurisdiction of incorporation or

(I.R.S. Employer Identification Number)

organization)

2801 East Beltline NE, Grand Rapids, Michigan

49525

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code (616) 364-6161

Universal Forest Products, Inc.

(Former name or former address, if changed since last report.)

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

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

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

Large Accelerated Filer

Accelerated Filer

Non-Accelerated Filer

Smaller Reporting Company

Emerging Growth Company

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

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

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:

Class

    

Outstanding as of March 28, 2020

Common stock, $1 par value

61,102,481

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

Title of Each Class

Trading Symbol

Name of Each Exchange On Which Registered

Common Stock, no par value

UFPI

The Nasdaq Stock Market, LLC

Table of Contents

UFP INDUSTRIES, INC.

TABLE OF CONTENTS

PART I.

FINANCIAL INFORMATION.

Page No.

Item 1.

Financial Statements

Condensed Consolidated Balance Sheets at March 28, 2020, December 28, 2019 and March 30, 2019

3

Condensed Consolidated Statements of Earnings and Comprehensive Income for the Three Months Ended March 28, 2020 and March 30, 2019

4

Condensed Consolidated Statements of Shareholders’ Equity for the Three Months Ended March 28, 2020 and March 30, 2019

5

Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 28, 2020 and March 30, 2019

6

Notes to Unaudited Condensed Consolidated Financial Statements

7

Item 2.

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

15

Item 3.

Quantitative and Qualitative Disclosures about Market Risk

26

Item 4.

Controls and Procedures

27

PART II.

OTHER INFORMATION

Item 1.

Legal Proceedings – NONE

Item 1A.

Risk Factors 

28

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

28

Item 3.

Defaults upon Senior Securities – NONE

Item 4.

Mine Safety Disclosures – NONE

Item 5.

Other Information – NONE

29

Item 6.

Exhibits

30

2

Table of Contents

UFP INDUSTRIES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(in thousands, except share data)

March 28,

December 28,

March 30,

    

2020

    

2019

    

2019

ASSETS

  

  

CURRENT ASSETS:

  

  

Cash and cash equivalents

$

32,129

    

$

168,336

  

$

17,111

Restricted cash

 

724

 

330

  

 

1,024

Investments

 

17,778

 

18,527

  

 

16,197

Accounts receivable, net

 

460,821

 

364,027

  

 

444,111

Inventories:

  

  

Raw materials

 

263,857

 

236,283

  

 

279,265

Finished goods

 

246,824

 

250,591

  

 

300,898

Total inventories

 

510,681

 

486,874

  

 

580,163

Refundable income taxes

 

2,624

 

13,272

  

 

4,629

Other current assets

 

36,152

 

41,706

  

 

40,237

TOTAL CURRENT ASSETS

 

1,060,909

 

1,093,072

 

1,103,472

DEFERRED INCOME TAXES

 

2,145

 

2,763

  

 

2,364

RESTRICTED INVESTMENTS

16,111

 

16,214

  

 

13,580

RIGHT OF USE ASSETS

81,065

80,167

66,100

OTHER ASSETS

 

25,198

 

24,884

  

 

8,419

GOODWILL

 

246,459

 

229,536

  

 

224,247

INDEFINITE-LIVED INTANGIBLE ASSETS

 

7,288

 

7,354

  

 

7,364

OTHER INTANGIBLE ASSETS, NET

 

46,232

 

48,313

  

 

39,686

PROPERTY, PLANT AND EQUIPMENT:

  

  

Property, plant and equipment

906,171

884,963

828,837

Less accumulated depreciation and amortization

 

(508,596)

 

(497,789)

  

 

(472,671)

PROPERTY, PLANT AND EQUIPMENT, NET

397,575

387,174

356,166

TOTAL ASSETS

1,882,982

1,889,477

1,821,398

LIABILITIES AND SHAREHOLDERS’ EQUITY

  

  

CURRENT LIABILITIES:

  

  

Cash overdraft

$

$

  

$

18,732

Accounts payable

 

162,039

 

142,479

  

 

170,667

Accrued liabilities:

  

  

Compensation and benefits

 

92,504

 

141,892

  

 

70,867

Other

 

55,760

 

51,572

  

 

45,618

Current portion of lease liability

16,180

15,283

14,500

Current portion of long-term debt

 

2,772

 

2,816

  

 

185

TOTAL CURRENT LIABILITIES

 

329,255

 

354,042

  

 

320,569

LONG-TERM DEBT

 

160,550

 

160,867

  

 

266,428

LEASE LIABILITY

64,937

64,884

51,600

DEFERRED INCOME TAXES

 

22,799

 

22,880

  

 

14,622

OTHER LIABILITIES

 

33,159

 

29,071

  

 

29,813

TOTAL LIABILITIES

 

610,700

 

631,744

  

 

683,032

SHAREHOLDERS’ EQUITY:

  

  

Controlling interest shareholders’ equity:

  

  

Preferred stock, no par value; shares authorized 1,000,000; issued and outstanding, none

$

$

  

$

Common stock, $1 par value; shares authorized 80,000,000; issued and outstanding, 61,102,481, 61,408,589 and 61,352,372

 

61,102

 

61,409

  

 

61,352

Additional paid-in capital

 

211,724

 

192,173

  

 

190,879

Retained earnings

 

998,996

 

995,022

  

 

875,457

Accumulated other comprehensive income

 

(11,110)

 

(4,889)

  

 

(4,789)

Total controlling interest shareholders’ equity

 

1,260,712

 

1,243,715

  

 

1,122,899

Noncontrolling interest

 

11,570

 

14,018

  

 

15,467

TOTAL SHAREHOLDERS’ EQUITY

 

1,272,282

 

1,257,733

  

 

1,138,366

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

$

1,882,982

$

1,889,477

  

$

1,821,398

See notes to consolidated condensed financial statements.

3

Table of Contents

UFP INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

AND COMPREHENSIVE INCOME

(Unaudited)

(in thousands, except per share data)

Three Months Ended

March 28,

March 30,

2020

    

2019

    

NET SALES

$

1,032,062

    

$

1,015,125

    

COST OF GOODS SOLD

 

864,826

 

860,858

GROSS PROFIT

 

167,236

 

154,267

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

 

109,339

 

105,317

OTHER

(735)

504

EARNINGS FROM OPERATIONS

 

58,632

 

48,446

INTEREST EXPENSE

 

1,908

 

2,460

INTEREST INCOME

 

(341)

 

(245)

UNREALIZED LOSS (GAIN) ON INVESTMENTS AND OTHER

3,173

(1,348)

 

4,740

 

867

EARNINGS BEFORE INCOME TAXES

 

53,892

 

47,579

INCOME TAXES

 

13,322

 

11,577

NET EARNINGS

 

40,570

 

36,002

LESS NET EARNINGS ATTRIBUTABLE TO NONCONTROLLING INTEREST

 

(411)

 

(462)

NET EARNINGS ATTRIBUTABLE TO CONTROLLING INTEREST

$

40,159

$

35,540

EARNINGS PER SHARE - BASIC

$

0.65

$

0.58

EARNINGS PER SHARE - DILUTED

$

0.65

$

0.58

OTHER COMPREHENSIVE INCOME:

NET EARNINGS

 

40,570

 

36,002

OTHER COMPREHENSIVE GAIN (LOSS)

 

(8,556)

 

1,373

COMPREHENSIVE INCOME

 

32,014

 

37,375

LESS COMPREHENSIVE INCOME ATTRIBUTABLE TO NONCONTROLLING INTEREST

 

1,924

 

(686)

COMPREHENSIVE INCOME ATTRIBUTABLE TO CONTROLLING INTEREST

$

33,938

$

36,689

See notes to consolidated condensed financial statements.

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UFP INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(Unaudited)

(in thousands, except share and per share data)

Controlling Interest Shareholders’ Equity

Accumulated

Additional

Other

Common

Paid-In

Retained

Comprehensive

Noncontrolling

    

Stock

    

Capital

    

Earnings

    

Earnings

    

Interest

    

Total

Balance at December 29, 2018

$

60,884

$

178,540

  

$

839,917

$

(5,938)

  

$

15,281

  

$

1,088,684

Net earnings

  

  

 

35,540

 

  

 

462

  

 

36,002

Foreign currency translation adjustment

  

  

  

 

982

 

224

  

 

1,206

Unrealized gain (loss) on investment & foreign currency

  

  

  

 

167

 

  

 

167

Distributions to noncontrolling interest

  

  

  

  

 

(500)

 

(500)

Issuance of 10,259 shares under employee stock plans

 

10

 

251

  

  

  

  

 

261

Issuance of 320,069 shares under stock grant programs

 

320

 

6,101

  

  

  

  

 

6,421

Issuance of 138,295 shares under deferred compensation plans

 

138

 

(138)

  

  

  

  

 

Expense associated with share-based compensation arrangements

  

 

1,226

 

  

 

  

 

  

 

1,226

Accrued expense under deferred compensation plans

  

 

4,899

 

  

 

  

 

  

 

4,899

Balance at March 30, 2019

$

61,352

$

190,879

  

$

875,457

$

(4,789)

  

$

15,467

  

$

1,138,366

Balance at December 28, 2019

$

61,409

$

192,173

  

$

995,022

$

(4,889)

  

$

14,018

  

$

1,257,733

Net earnings

  

  

 

40,159

 

  

 

411

  

 

40,570

Foreign currency translation adjustment

  

  

  

 

(5,951)

 

(2,335)

  

 

(8,286)

Unrealized loss on debt securities

  

  

  

 

(270)

 

  

 

(270)

Distributions to noncontrolling interest

  

  

  

  

 

(299)

 

(299)

Additional purchase of noncontrolling interest

130

(225)

(95)

Cash dividends - $0.125 per share - quarterly

  

  

 

(7,730)

 

  

 

  

 

(7,730)

Issuance of 10,549 shares under employee stock plans

 

10

 

309

  

  

  

  

 

319

Issuance of 350,124 shares under stock grant programs

 

350

 

12,454

  

1

  

  

  

 

12,805

Issuance of 89,616 shares under deferred compensation plans

 

89

 

(89)

  

  

  

  

 

Repurchase of 756,397 shares

(756)

(28,456)

(29,212)

Expense associated with share-based compensation arrangements

  

 

1,404

 

  

 

  

 

  

 

1,404

Accrued expense under deferred compensation plans

  

 

5,343

 

  

 

  

 

  

 

5,343

Balance at March 28, 2020

$

61,102

$

211,724

  

$

998,996

$

(11,110)

  

$

11,570

  

$

1,272,282

See notes to consolidated condensed financial statements.

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UFP INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(in thousands)

Three Months Ended

March 28,

March 30,

    

2020

    

2019

    

CASH FLOWS FROM OPERATING ACTIVITIES:

  

Net earnings

$

40,570

    

$

36,002

Adjustments to reconcile net earnings to net cash from operating activities:

  

Depreciation

 

15,717

 

14,475

Amortization of intangibles

 

1,571

 

1,852

Expense associated with share-based and grant compensation arrangements

 

1,444

 

1,287

Deferred income taxes (credit)

 

286

 

(742)

Unrealized (gain) loss on investments

 

3,173

 

(1,348)

Net gain on disposition of assets and impairment of assets

 

(285)

 

(122)

Changes in:

  

Accounts receivable

 

(94,253)

 

(100,716)

Inventories

 

(25,783)

 

(23,649)

Accounts payable and cash overdraft

 

20,047

 

25,056

Accrued liabilities and other

 

(8,648)

 

(7,924)

NET CASH USED IN OPERATING ACTIVITIES

 

(46,161)

 

(55,829)

CASH FLOWS FROM INVESTING ACTIVITIES:

  

Purchases of property, plant and equipment

 

(27,286)

 

(15,883)

Proceeds from sale of property, plant and equipment

 

409

 

241

Acquisitions and purchases of non-controlling interest, net of cash received

 

(18,487)

 

Investment in life insurance contracts

 

 

Purchases of investments

 

(14,052)

 

(449)

Proceeds from sale of investments

 

11,260

 

340

Other

 

(54)

 

200

NET CASH USED IN INVESTING ACTIVITIES

 

(48,210)

 

(15,551)

CASH FLOWS FROM FINANCING ACTIVITIES:

  

Borrowings under revolving credit facilities

 

6,759

 

237,560

Repayments under revolving credit facilities

 

(6,498)

 

(173,232)

Repayment of debt

(3,074)

(3,029)

Proceeds from issuance of common stock

 

319

 

261

Dividends paid to shareholders

 

(7,730)

 

Distributions to noncontrolling interest

(299)

(500)

Repurchase of common stock

 

(29,212)

 

Other

 

12

 

9

NET CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES

 

(39,723)

 

61,069

Effect of exchange rate changes on cash

 

(1,719)

 

248

NET CHANGE IN CASH AND CASH EQUIVALENTS

 

(135,813)

 

(10,063)

CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, BEGINNING OF YEAR

 

168,666

 

28,198

CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, END OF PERIOD

$

32,853

$

18,135

RECONCILIATION OF CASH AND CASH EQUIVALENTS AND RESTRICTED CASH:

Cash and cash equivalents, beginning of period

$

168,336

$

27,316

Restricted cash, beginning of period

330

882

Cash, cash equivalents, and restricted cash, beginning of period

$

168,666

$

28,198

Cash and cash equivalents, end of period

$

32,129

$

17,111

Restricted cash, end of period

724

1,024

Cash, cash equivalents, and restricted cash, end of period

$

32,853

$

18,135

SUPPLEMENTAL INFORMATION:

  

Interest paid

$

374

$

570

Income taxes paid

 

2,307

 

2,801

NON-CASH FINANCING ACTIVITIES:

Common stock issued under deferred compensation plans

 

4,900

 

4,457

See notes to consolidated condensed financial statements.

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UFP INDUSTRIES, INC.

NOTES TO UNAUDITED

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

A.       BASIS OF PRESENTATION

The accompanying unaudited interim consolidated condensed financial statements (the “Financial Statements”) include our accounts and those of our wholly-owned and majority-owned subsidiaries and partnerships, and have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Accordingly, the Financial Statements do not include all the information and footnotes normally included in the annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States. All intercompany transactions and balances have been eliminated.

In our opinion, the Financial Statements contain all material adjustments necessary to present fairly our consolidated financial position, results of operations and cash flows for the interim periods presented. All such adjustments are of a normal recurring nature. These Financial Statements should be read in conjunction with the annual consolidated financial statements, and footnotes thereto, included in our Annual Report to Shareholders on Form 10-K for the fiscal year ended December 28, 2019.

On April 22, 2020, the shareholders approved changing the name of the Company from Universal Forest Products, Inc., to UFP Industries, Inc.

Seasonality has a significant impact on our working capital from March to August which historically results in negative or modest cash flows from operations in our first and second quarters. Conversely, we experience a substantial decrease in working capital from September to February which typically results in significant cash flow from operations in our third and fourth quarters. For comparative purposes, we have included the March 30, 2019 balances in the accompanying unaudited condensed consolidated balance sheets.

On March 11, 2020, the World Health Organization declared the novel strain of coronavirus (COVID-19) a global pandemic and recommended containment and mitigation measures worldwide, which subsequently resulted in a variety of “stay at home” orders issued by states in which we operate.  As of the date of this filing, the majority of our customers and operations have been deemed to be essential businesses under these state orders.   Consequently, all but 3 of our 150 plant locations remain operating.  We cannot reasonably estimate the length or severity of this pandemic and government restrictions on business activity, or the extent to which these restrictions may materially impact our consolidated financial position, consolidated results of operations, and consolidated cash flows in fiscal 2020.

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UFP INDUSTRIES, INC.

B.       FAIR VALUE

We apply the provisions of ASC 820, Fair Value Measurements and Disclosures, to assets and liabilities measured at fair value. Assets measured at fair value are as follows:

March 28, 2020

March 30, 2019

Quoted

Prices with

Quoted

Prices with

Prices in

Other

Prices with

Prices in

Other

Prices with

Active

Observable

Unobservable

Active

Observable

Unobservable

Markets

Inputs

Inputs

Markets

Inputs

Inputs

(in thousands)

    

(Level 1)

    

(Level 2)

    

(Level 3)

Total

    

(Level 1)

    

(Level 2)

    

(Level 3)

    

Total

Money market funds

$

29,561

    

$

837

$

    

$

30,398

    

$

56

    

$

549

$

    

$

605

Fixed income funds

 

237

 

15,124

 

 

15,361

 

3,860

 

9,763

 

 

13,623

Equity securities

 

9,089

 

 

 

9,089

 

8,258

 

 

 

8,258

Alternative investments

1,960

1,960

1,782

1,782

Mutual funds:

  

 

  

  

 

Domestic stock funds

 

5,204

 

 

 

5,204

 

2,151

 

 

 

2,151

International stock funds

 

947

 

 

 

947

 

2,085

 

 

 

2,085

Target funds

 

242

 

 

 

242

 

257

 

 

 

257

Bond funds

 

222

 

 

 

222

 

799

 

 

 

799

Alternative funds

921

921

1,344

1,344

Total mutual funds

 

7,536

 

 

 

7,536

 

6,636

 

 

 

6,636

Total

$

46,423

$

15,961

$

1,960

$

64,344

$

18,810

$

10,312

$

1,782

$

30,904

Assets at fair value

$

46,423

$

15,961

$

1,960

 

$

64,344

$

18,810

$

10,312

$

1,782

 

$

30,904

From the assets measured at fair value as of March 28, 2020, listed in the table above, $29.5 million of money market funds are held in Cash and Cash Equivalents, $17.7 million of mutual funds, equity securities, and alternative investments are held in Investments, $0.9 million of money market and mutual funds are held in Other Assets for our deferred compensation plan, and $15.4 million of fixed income funds and $0.8 million of money markets funds are held in Restricted Investments.

We maintain money market, mutual funds, bonds, and/or stocks in our non-qualified deferred compensation plan, our wholly owned licensed captive insurance company, and assets held in financial institutions. These funds are valued at prices quoted in an active exchange market and are included in “Cash and Cash Equivalents”, “Investments”, “Other Assets”, and “Restricted Investments”. We have elected not to apply the fair value option under ASC 825, Financial Instruments, to any of our financial instruments except for those expressly required by U.S. GAAP.

In accordance with our investment policy, our wholly-owned captive, Ardellis Insurance Ltd. (“Ardellis”), maintains an investment portfolio, totaling $33.1 million as of March 28, 2020, consisting of domestic and international stocks, alternative investments, and fixed income bonds.  

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UFP INDUSTRIES, INC.

Ardellis’ available for sale investment portfolio, including funds held with the State of Michigan, consists of the following (in thousands):

March 28, 2020

Unrealized

    

Cost

    

Gain/(Loss)

    

Fair Value

Fixed Income

$

1,834

    

$

126

  

$

1,960

Equity

 

15,257

 

104

  

 

15,361

Mutual Funds

9,690

(601)

  

9,089

Alternative Investments

7,298

(569)

  

6,729

Total

$

34,079

$

(940)

  

$

33,139

Our fixed income investments consist of a blend of US Government and Agency bonds and investment grade corporate bonds with varying maturities.  Our equity investments consist of small, mid, and large cap growth and value funds, as well as international equity. Our alternative investments consist of the private real estate income trust which is valued as a Level 3 asset.  The net unrealized loss was $0.9 million. Carrying amounts above are recorded in the investments and restricted investments line items within the balance sheet as of March 28, 2020.

C.       REVENUE RECOGNITION

Within the three primary segments (Retail, Industrial, and Construction) that the Company operates, there are a variety of written agreements governing the sale of our products and services.  The transaction price is stated at the purchase order level, which includes shipping and/or freight costs and any applicable governmental authority taxes.  The majority of our contracts have a single performance obligation concentrated around the delivery of goods to the carrier, Free On Board (FOB) shipping point.  Therefore, revenue is recognized when this performance obligation is satisfied.  Generally, title and control passes at the time of shipment. In certain circumstances, the customer takes title when the shipment arrives at the destination. However, our shipping process is typically completed the same day.

Certain customer products that we provide require installation by the Company or a 3rd party.  Installation revenue is recognized upon completion.  If the Company uses a 3rd party for installation, the party will act as an agent to the Company until completion of the installation.  Installation revenue represents an immaterial share of the Company’s total sales.

The Company utilizes rebates, credits, discounts and/or cash-based incentives with certain customers which are accounted for as variable consideration. We estimate these amounts based on the expected amount to be provided to customers and reduce revenues recognized. We believe that there will not be significant changes to our estimates of variable consideration.  The allocation of these costs are applied at the invoice level and recognized in conjunction with revenue.  Additionally, returns and refunds are estimated on a historical and expected basis which is a reduction of revenue recognized.

Earnings on construction contracts are reflected in operations using over time accounting, under either cost to cost or units of delivery methods, depending on the nature of the business at individual operations, which is in accordance with ASC 606 as revenue is recognized when certain performance obligations are performed. Under over time accounting using the cost to cost method, revenues and related earnings on construction contracts are measured by the relationships of actual costs incurred related to the total estimated costs. Under over time accounting using the units of delivery method, revenues and related earnings on construction contracts are measured by the relationships of actual units produced related to the total number of units. Revisions in earnings estimates on the construction contracts are recorded in the accounting period in which the basis for such revisions becomes known. Projected losses on individual contracts are charged to operations in their entirety when such losses become apparent.  

Our construction contracts are generally entered into with a fixed price and completion of the projects can range from 6 to 18 months in duration. Therefore, our operating results are impacted by, among many other things, labor rates

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UFP INDUSTRIES, INC.

and commodity costs. During the year, we update our estimated costs to complete our projects using current labor and commodity costs and recognize losses to the extent that they exist.

The following table presents our gross revenues disaggregated by revenue source:

(in thousands)

    

March 28,

    

March 30,

    

Market Classification

2020

2019

% Change

FOB Shipping Point Revenue

$

1,017,906

$

996,823

 

2.1%

Construction Contract Revenue

 

32,800

34,782

 

-5.7%

Total Gross Sales

 

1,050,706

1,031,605

 

1.9%

Sales Allowances

(18,644)

(16,480)

13.1%

Total Net Sales

$

1,032,062

$

1,015,125

1.7%

The Construction segment comprises the construction contract revenue shown above.  Construction contract revenue is primarily made up of site-built and framing customers.

The following table presents the balances of over time accounting accounts which are included in “Other current assets” and “Accrued liabilities: Other”, respectively (in thousands):

March 28,

December 28,

March 30,

    

2020

    

2019

    

2019

    

Cost and Earnings in Excess of Billings

$

5,744

    

$

4,960

    

$

7,880

    

Billings in Excess of Cost and Earnings

 

9,920

 

6,622

 

 

5,020

D.       EARNINGS PER SHARE

The computation of earnings per share (“EPS”) is as follows (in thousands):

Three Months Ended

March 28,

    

March 30,

    

2020

2019

Numerator:

  

 

  

 

Net earnings attributable to controlling interest

$

40,159

$

35,540

Adjustment for earnings allocated to non-vested restricted common stock

 

(1,059)

 

(865)

Net earnings for calculating EPS

$

39,100

$

34,675

Denominator:

 

  

 

  

Weighted average shares outstanding

 

61,842

 

61,372

Adjustment for non-vested restricted common stock

 

(1,630)

 

(1,493)

Shares for calculating basic EPS

 

60,212

 

59,879

Effect of dilutive restricted common stock

 

18

 

75

Shares for calculating diluted EPS

 

60,230

 

59,954