Cognex(CGNX) - 2019 Q1 - Quarterly Report

FORM 10-Q Filing Information This section details Cognex Corporation's Form 10-Q filing, confirming its large accelerated filer status for the period ended March 31, 2019 General Information This section provides general filing details for Cognex Corporation's Form 10-Q, including its large accelerated filer status and reporting period - Type of Report: Quarterly Report on Form 10-Q for the period ended March 31, 2019[2] - Registrant Status: Large accelerated filer[5] - Common Stock Outstanding (March 31, 2019): 171,536,645 shares[7] PART I: FINANCIAL INFORMATION This part presents the unaudited consolidated financial statements and management's discussion and analysis for the interim period Item 1. Financial Statements (interim periods unaudited) This section presents Cognex Corporation's unaudited interim consolidated financial statements, including operations, balance sheets, cash flows, and detailed notes Consolidated Statements of Operations For Q1 2019, revenue increased 2% year-over-year, but net income and diluted EPS decreased, with gross margin declining to 73% Consolidated Statements of Operations (Three-months Ended) | Metric (in thousands, except per share) | March 31, 2019 | April 1, 2018 | YoY Change (%) | | :-------------------------------------- | :------------- | :------------ | :------------- | | Revenue | $173,484 | $169,567 | 2.3% | | Cost of revenue | $46,284 | $40,198 | 15.1% | | Gross margin | $127,200 | $129,369 | -1.7% | | Gross margin % | 73.3% | 76.3% | -3.0 pp | | Operating income | $30,147 | $34,596 | -12.9% | | Net income | $33,104 | $37,217 | -11.0% | | Basic EPS | $0.19 | $0.21 | -9.5% | | Diluted EPS | $0.19 | $0.21 | -9.5% | | Cash dividends per common share | $0.050 | $0.045 | 11.1% | Consolidated Statements of Comprehensive Income Total comprehensive income decreased 11.3% year-over-year in Q1 2019, driven by lower net income and reduced foreign currency translation adjustments Consolidated Statements of Comprehensive Income (Three-months Ended) | Metric (in thousands) | March 31, 2019 | April 1, 2018 | YoY Change (%) | | :--------------------------------------------------- | :------------- | :------------ | :------------- | | Net income | $33,104 | $37,217 | -11.0% | | Net change related to available-for-sale investments | $2,211 | ($1,214) | N/A | | Net change related to foreign currency translation | $218 | $4,056 | -94.6% | | Other comprehensive income (loss), net of tax | $2,429 | $2,842 | -14.5% | | Total comprehensive income | $35,533 | $40,059 | -11.3% | Consolidated Balance Sheets As of March 31, 2019, total assets increased 5% due to non-current investments, with liabilities and shareholders' equity also showing growth Consolidated Balance Sheets (as of) | Metric (in thousands) | March 31, 2019 | December 31, 2018 | Change (%) | | :------------------------------------- | :------------- | :---------------- | :--------- | | ASSETS | | | | | Total current assets | $773,245 | $780,326 | -0.9% | | Non-current investments | $317,054 | $262,039 | 21.8% | | Total assets | $1,353,772 | $1,289,667 | 5.0% | | LIABILITIES | | | | | Total current liabilities | $93,045 | $91,357 | 1.8% | | Total liabilities | $164,913 | $154,404 | 6.8% | | SHAREHOLDERS' EQUITY | | | | | Total shareholders' equity | $1,188,859 | $1,135,263 | 4.7% | Consolidated Statements of Cash Flows Q1 2019 saw an 11.8% increase in operating cash flow, a shift to net cash used in investing, and a change in financing activities due to reduced stock repurchases Consolidated Statements of Cash Flows (Three-months Ended) | Metric (in thousands) | March 31, 2019 | April 1, 2018 | YoY Change (%) | | :------------------------------------------ | :------------- | :------------ | :------------- | | Net cash provided by operating activities | $61,261 | $54,786 | 11.8% | | Net cash provided by (used in) investing activities | ($70,102) | $12,959 | N/A |\ | Net cash provided by (used in) financing activities | $5,782 | ($65,866) | N/A |\ | Net change in cash and cash equivalents | ($2,916) | $2,990 | N/A |\ | Cash and cash equivalents at end of period | $105,296 | $109,572 | -3.9% | Consolidated Statements of Shareholders' Equity Shareholders' equity increased to $1,188,859 thousand as of March 31, 2019, driven by net income and stock issuances, partially offset by dividends Consolidated Statements of Shareholders' Equity (Three-months Ended) | Metric (in thousands) | March 31, 2019 | December 31, 2018 | | :--------------------------------------------------- | :------------- | :---------------- | | Balance as of December 31, 2018 | N/A | $1,135,263 | | Issuance of common stock under stock plans | $14,346 | N/A | | Stock-based compensation expense | $12,281 | N/A | | Payment of dividends | ($8,564) | N/A | | Net income | $33,104 | N/A | | Net unrealized gain (loss) on available-for-sale investments, net of tax | $2,251 | N/A |\ | Reclassification of net realized (gain) loss | ($40) | N/A | | Foreign currency translation adjustment | $218 | N/A | | Balance as of March 31, 2019 | $1,188,859 | N/A | Notes to Consolidated Financial Statements These notes provide detailed explanations for the consolidated financial statements, covering accounting policies, fair value, cash, investments, leases, and revenue NOTE 1: Summary of Significant Accounting Policies This note outlines significant accounting policies, including the adoption of ASC 842 'Leases' from January 1, 2019, for interim financial statements - Interim financial statements are condensed, unaudited, and include normal, recurring adjustments[29] - Adopted ASC 842 "Leases" on January 1, 2019, recognizing lease assets and liabilities on the balance sheet[29][30] - Leases are classified as finance or operating based on specific criteria, with operating lease expense recognized on a straight-line basis[31][33] NOTE 2: New Pronouncements This note discusses new accounting pronouncements, including ASUs on credit losses, callable debt, and internal-use software, with no material impact expected - ASU 2016-13 (Credit Losses) effective after December 15, 2019; no material impact expected[34] - ASU 2017-08 (Premium Amortization on Callable Debt Securities) effective after December 15, 2019; no material impact expected[34] - ASU 2018-15 (Internal-Use Software) effective after December 15, 2019; no material impact expected[35] NOTE 3: Fair Value Measurements This note details fair value measurements for financial assets and liabilities, categorized into Level 1, 2, and 3, with Level 3 contingent consideration liabilities Financial Assets and Liabilities Measured at Fair Value (March 31, 2019, in thousands) | Asset/Liability | Level 1 (Quoted Prices) | Level 2 (Observable Inputs) | Level 3 (Unobservable Inputs) | | :------------------------------- | :---------------------- | :-------------------------- | :---------------------------- | | Money market instruments | $10,883 | — | — | | Treasury bills | — | $295,106 | — | | Corporate bonds | — | $289,873 | — | | Asset-backed securities | — | $140,370 | — | | Sovereign bonds | — | $21,791 | — | | Agency bonds | — | $5,913 | — | | Municipal bonds | — | $5,338 | — | | Economic hedge forward contracts | — | $34 | — | | Economic hedge forward contracts | — | $31 | — | | Contingent consideration liabilities | — | — | $1,569 | - Contingent consideration liabilities are Level 3, valued using probability-adjusted present values and unobservable inputs like revenue milestone likelihood[38] NOTE 4: Cash, Cash Equivalents, and Investments Cash, cash equivalents, and investments totaled $863,687 thousand as of March 31, 2019, an increase from year-end 2018, primarily in debt securities Cash, Cash Equivalents, and Investments (in thousands) | Category | March 31, 2019 | December 31, 2018 | | :---------------------- | :------------- | :---------------- | | Cash and cash equivalents | $105,296 | $108,212 | | Current investments | $441,337 | $427,348 | | Non-current investments | $317,054 | $262,039 | | Total | $863,687 | $797,599 | - As of March 31, 2019, the Company had $758,391 thousand in available-for-sale investments, with gross unrealized gains of $1,253 thousand and gross unrealized losses of $705 thousand[39] - The Company does not intend to sell, and is unlikely to be required to sell, any available-for-sale investments in an unrealized loss position before their effective maturity or market price recovery[41] NOTE 5: Inventories Inventories decreased to $79,208 thousand as of March 31, 2019, primarily due to reductions in raw materials and work-in-process Inventories (in thousands) | Category | March 31, 2019 | December 31, 2018 | | :---------------- | :------------- | :---------------- | | Raw materials | $37,491 | $42,738 | | Work-in-process | $2,891 | $3,435 | | Finished goods | $38,826 | $37,109 | | Total Inventories | $79,208 | $83,282 | NOTE 6: Leases The Company adopted ASC 842 'Leases' on January 1, 2019, recognizing lease assets and liabilities for its operating leases, primarily for properties - Adopted ASC 842 on January 1, 2019, recording $17,522 thousand in lease assets and $17,405 thousand in lease liabilities[42] - All leases are classified as operating leases, primarily for properties across different worldwide locations[46] - Total operating lease expense for the three months ended March 31, 2019, was $1,485 thousand, with a weighted-average discount rate of 4.8% and a remaining lease term of 4.1 years[47][49] NOTE 7: Intangible Assets Net intangible assets decreased to $9,344 thousand as of March 31, 2019, primarily due to amortization, with completed technologies and customer relationships as key Amortized Intangible Assets (in thousands) | Category | Gross Carrying Value (March 31, 2019) | Accumulated Amortization (March 31, 2019) | Net Carrying Value (March 31, 2019) | Net Carrying Value (Dec 31, 2018) | | :----------------------- | :------------------------------------ | :---------------------------------------- | :---------------------------------- | :-------------------------------- | | Distribution networks | $38,060 | $38,060 | $— | $— | | Completed technologies | $13,687 | $7,230 | $6,457 | $7,068 | | Customer relationships | $8,607 | $5,844 | $2,763 | $2,891 | | Non-compete agreements | $370 | $246 | $124 | $154 | | Total | $60,724 | $51,380 | $9,344 | $10,113 | - Estimated future amortization expense for intangible assets is $1,932 thousand for the remainder of fiscal 2019 and $2,185 thousand for 2020[53] NOTE 8: Warranty Obligations Warranty obligations are estimated at the time of sale based on historical claims and are recorded within 'Accrued expenses' - Warranty obligations are estimated at the time of sale based on historical costs and are included in "Accrued expenses"[54] NOTE 9: Derivative Instruments Cognex uses foreign currency forward contracts as economic hedges for foreign currency risk from receivables and payables, without hedge accounting designation - The Company uses foreign currency forward contracts as economic hedges to manage foreign currency risk, primarily from foreign-denominated receivables and payables[55] - These economic hedges are not designated for hedge accounting treatment[58] - For the three months ended March 31, 2019, the Company recognized a foreign currency gain of $505 thousand from derivatives, compared to a loss of $310 thousand in the prior year[58] NOTE 10: Revenue Recognition Total revenue for Q1 2019 was $173,484 thousand, with Americas growth offset by declines in Greater China and Other Asia, primarily from standard products Disaggregated Revenue by Geographic Area (Three-months Ended, in thousands) | Geographic Area | March 31, 2019 | April 1, 2018 | YoY Change (%) | | :-------------- | :------------- | :------------ | :------------- | | Americas | $65,156 | $59,217 | 10.0% | | Europe | $59,657 | $56,203 | 6.1% | | Greater China | $22,810 | $27,159 | -16.0% | | Other Asia | $25,861 | $26,988 | -4.2% | | Total | $173,484 | $169,567 | 2.3% | Disaggregated Revenue by Revenue Type (Three-months Ended, in thousands) | Revenue Type | March 31, 2019 | April 1, 2018 | YoY Change (%) | | :-------------------------------- | :------------- | :------------ | :------------- | | Standard products and services | $161,052 | $158,399 | 1.7% | | Application-specific customer solutions | $12,432 | $11,168 | 11.3% |\ | Total | $173,484 | $169,567 | 2.3% | - Deferred revenue and customer deposits increased from $9,845 thousand at December 31, 2018, to $16,625 thousand at March 31, 2019[62] NOTE 11: Stock-Based Compensation Expense Stock-based compensation expense decreased to $12,281 thousand in Q1 2019, with 2,761 thousand stock options granted at a weighted-average exercise price of $51.49 Stock Option Activity (Three-months Ended March 31, 2019, in thousands) | Metric | Shares | Weighted-Average Exercise Price | | :-------------------------------------- | :----- | :------------------------------ | | Outstanding as of December 31, 2018 | 13,789 | $31.73 | | Granted | 2,761 | $51.49 | | Exercised | (717) | $20.03 | | Forfeited or expired | (139) | $41.73 | | Outstanding as of March 31, 2019 | 15,694 | $35.65 | | Exercisable as of March 31, 2019 | 6,289 | $24.86 | - Total unrecognized compensation expense related to non-vested stock options was $75,985 thousand as of March 31, 2019, expected to be recognized over 2.14 years[72] Stock-Based Compensation Expense by Caption (Three-months Ended, in thousands) | Caption | March 31, 2019 | April 1, 2018 | | :------------------------------------- | :------------- | :------------ | | Cost of revenue | $451 | $797 | | Research, development, and engineering | $4,467 | $4,815 | | Selling, general, and administrative | $7,363 | $7,582 | | Total | $12,281 | $13,194 | NOTE 12: Stock Repurchase Program The Board authorized a $200 million stock repurchase program in October 2018, with no repurchases in Q1 2019, leaving $191,378 thousand available - Board authorized a $200 million stock repurchase program in October 2018[73] - As of March 31, 2019, $8,622 thousand was used to repurchase 203,000 shares; $191,378 thousand remains authorized. No shares were repurchased in Q1 2019[73] NOTE 13: Taxes The effective tax rate increased to 7% in Q1 2019, influenced by foreign tax rate differentials and discrete tax benefits from stock option exercises Effective Tax Rate Reconciliation (Three-months Ended) | Factor | March 31, 2019 | April 1, 2018 | | :---------------------------------------------- | :------------- | :------------ | | Income tax expense at U.S federal statutory rate | 21% | 21% | | State income taxes, net of federal benefit | 1% | 1% | | Foreign tax rate differential | (9)% | (7)% | | Discrete tax benefit from stock option exercises | (8)% | (13)% | | Other | 2% | 1% | | Income tax expense (Effective Tax Rate) | 7% | 2% | - Major tax jurisdictions include the United States, Ireland (12.5% statutory rate), and China (25% statutory rate)[77] - A potential release of $1,250,000 to $1,350,000 in income tax reserves is possible over the next twelve months due to the expiration of certain statutes of limitations[77] NOTE 14: Weighted-Average Shares Diluted weighted-average shares outstanding decreased to 175,607 thousand in Q1 2019 from 179,641 thousand in the prior year Weighted-Average Shares (in thousands) | Metric | March 31, 2019 | April 1, 2018 | | :---------------------------------------------- | :------------- | :------------ | | Basic weighted-average common shares outstanding | 171,098 | 173,280 | | Effect of dilutive stock options | 4,509 | 6,361 | | Diluted weighted-average shares outstanding | 175,607 | 179,641 | - Stock options to purchase 4,832,000 shares (2019) and 1,339,000 shares (2018) were anti-dilutive and excluded from diluted EPS calculation[78] NOTE 15: Subsequent Events On April 29, 2019, the Board declared a cash dividend of $0.050 per share, payable on May 31, 2019 - A cash dividend of $0.050 per share was declared on April 29, 2019, payable on May 31, 2019[79] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses Q1 2019 financial performance, highlighting revenue growth from logistics, declines in automotive and Greater China, and changes in key financial metrics Forward-Looking Statements This section cautions that forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from expectations - Statements regarding business trends, future financial performance, customer orders, growth areas, product mix, R&D, investments, and strategic plans are forward-looking[81] - Risks include loss of large customers, global economic conditions (tariffs/export controls), reliance on consumer electronics/automotive, inability to penetrate new markets, foreign currency fluctuations, cybersecurity breaches, and inability to retain skilled employees[81] Executive Overview Cognex, a machine vision leader, saw Q1 2019 revenue increase 2% driven by logistics, offset by automotive and Greater China declines, with reduced profitability - Cognex is a leading worldwide provider of machine vision products for automating tasks in manufacturing and logistics[82] Q1 2019 Performance Overview | Metric | Q1 2019 | Q1 2018 | YoY Change | | :---------------------- | :------ | :------ | :--------- | | Revenue | $173,484K | $169,567K | +2% | | Gross Margin % | 73% | 76% | -3 pp | | Operating Income % | 17% | 20% | -3 pp | | Net Income % | 19% | 22% | -3 pp | | Net Income per Diluted Share | $0.19 | $0.21 | -9.5% | - Strong sales in the logistics industry were partially offset by slowing order trends in the automotive industry in the Americas and lower demand from customers in Greater China[82] Results of Operations This section analyzes Q1 2019 financial performance, detailing revenue, gross margin, operating expenses, non-operating items, and income tax expense Revenue Q1 2019 revenue increased 2% to $173,484 thousand (5% constant-currency), driven by Americas and Europe logistics, despite a 16% decline in Greater China Revenue Performance (Three-months Ended) | Metric | March 31, 2019 | April 1, 2018 | YoY Change | Constant-Currency Change | | :------------------------------------ | :------------- | :------------ | :--------- | :----------------------- | | Total Revenue | $173,484K | $169,567K | +2% | +5% | | Americas Sales Growth | +10% | N/A | N/A | N/A | | Europe Sales Growth | +6% | N/A | +12% | N/A | | Greater China Sales Growth | -16% | N/A | -10% | N/A | | Other Asia Sales Growth | -4% | N/A | N/A | N/A | - Foreign currency exchange rates decreased revenue by approximately 3%[85] - Full-year 2019 revenue is expected to be slightly lower than 2018, with higher logistics revenue offset by significantly lower consumer electronics revenue[87] Gross Margin Gross margin declined to 73% in Q1 2019 due to unfavorable manufacturing overhead, negative foreign currency, and a shift to lower-margin logistics sales Gross Margin Percentage | Period | Gross Margin % | | :----- | :------------- | | Q1 2019 | 73% | | Q1 2018 | 76% | - Decline due to unfavorable absorption of manufacturing overhead, negative foreign currency impact, and product mix shift to lower-margin logistics sales[88] - Gross margin percentage is expected to be in the mid-70s range for Q2 2019[88] Operating Expenses Total operating expenses increased 2% year-over-year, with RD&E slightly down due to reduced outsourced services, and SG&A up due to higher personnel costs Research, development, and engineering (RD&E) expenses RD&E expenses decreased 3% to $30,242 thousand in Q1 2019, as higher personnel costs were offset by reduced outsourced services and prototyping RD&E Expenses (Three-month period, in thousands) | Metric | Q1 2018 | Personnel-related costs | Outsourced engineering services | Prototyping materials | Foreign currency exchange rate changes | Other | Q1 2019 | | :------------------------------------ | :------ | :---------------------- | :------------------------------ | :-------------------- | :------------------------------------- | :---- | :------ | | RD&E expenses | $31,076 | $1,099 | ($394) | ($485) | ($729) | ($325) | $30,242 | - RD&E expenses as a percentage of revenue were 17% in Q1 2019, down from 18% in Q1 2018[92] - The Company targets RD&E spending to be between 10% and 15% of revenue annually[92] Selling, General, and Administrative (SG&A) Expenses SG&A expenses increased 5% to $66,811 thousand in Q1 2019, driven by higher personnel costs, partially offset by lower ERP project costs and favorable foreign currency SG&A Expenses (Three-month period, in thousands) | Metric | Q1 2018 | Personnel-related costs | ERP project costs | Foreign currency exchange rate changes | Other | Q1 2019 | | :------------------------------------ | :------ | :---------------------- | :---------------- | :------------------------------------- | :---- | :------ | | SG&A expenses | $63,697 | $7,785 | ($1,245) | ($1,685) | ($1,741) | $66,811 | - Increase driven by headcount additions, principally sales personnel, and related costs like commissions and travel[93] - Partially offset by the absence of ERP project costs incurred in Q1 2018[93] Non-operating Income (Expense) Q1 2019 saw increased foreign currency losses, a 51% rise in investment income to $4,905 thousand, and higher other income from contingent consideration revaluation Non-operating Income (Expense) (Three-months Ended, in thousands) | Metric | March 31, 2019 | April 1, 2018 | YoY Change (%) | | :--------------------------- | :------------- | :------------ | :------------- | | Foreign currency gain (loss) | ($248) | ($134) | -85.1% | | Investment income | $4,905 | $3,240 | 51.4% | | Other income (expense) | $927 | $277 | 234.6% | - Investment income increase due to higher yields on debt securities and additional funds for investment[94] - Other income included a net benefit from revaluation of contingent consideration liabilities ($985K in Q1 2019 vs. $442K in Q1 2018)[94] Income Tax Expense The effective tax rate increased to 7% in Q1 2019 from 2% in Q1 2018, with a consistent 15% rate excluding discrete stock option tax events Income Tax Expense and Effective Tax Rate | Metric | March 31, 2019 | April 1, 2018 | | :---------------------------------------------- | :------------- | :------------ | | Income tax expense (in thousands) | $2,627 | $762 | | Effective tax rate | 7% | 2% | | Effective tax rate (excluding discrete tax events) | 15% | 15% | - Discrete tax benefits from stock option exercises decreased the effective tax rate by 8 percentage points in Q1 2019 and 13 percentage points in Q1 2018[95] Liquidity and Capital Resources The Company maintains strong liquidity with $863,687 thousand in cash and investments, with operating cash flows funding Q1 2019 requirements and expected to be sufficient - Total cash and investment balance was $863,687 thousand as of March 30, 2019[98] - Q1 2019 cash requirements were met by positive cash flows from operations, which included a reduction in accounts receivable and inventory levels[98] - Capital expenditures totaled $5,078 thousand in Q1 2019[98] - The Company paid $8,564 thousand in cash dividends in Q1 2019[98] - No shares were repurchased under the $200 million stock repurchase program in Q1 2019; $191,378 thousand remains authorized[98] - Management believes existing cash and investments, along with operating cash flow, will be sufficient for the next twelve months[98] New Pronouncements This section refers to Note 2 for details on new accounting pronouncements, their adoption dates, and anticipated impact on financial statements - Refer to Note 2 for details on new accounting pronouncements and their expected impact[99] Item 3. Quantitative and Qualitative Disclosures About Market Risk No material changes to the Company's market risk exposures have occurred since December 31, 2018 - No material changes to market risk exposures since December 31, 2018[100] Item 4. Controls and Procedures Disclosure controls and procedures were effective as of March 31, 2019, with no material changes to internal control over financial reporting during Q1 - Disclosure controls and procedures were effective as of March 31, 2019[101] - No material changes in internal control over financial reporting during Q1 2019[101] PART II: OTHER INFORMATION This part includes other information such as legal proceedings, risk factors, equity sales, defaults, and exhibits Item 1. Legal Proceedings Pending legal claims are not expected to have a material adverse effect on the Company's financial position, liquidity, or results of operations - Pending legal proceedings are incidental to normal business, and any liability is not expected to have a material adverse effect on financial position, liquidity, or results of operations[103] Item 1A. Risk Factors This section refers to the Annual Report on Form 10-K for a comprehensive discussion of risk factors affecting the Company's business and financial condition - For a comprehensive list of risk factors, refer to Part I—Item 1A of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2018[104] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds No common stock was repurchased in Q1 2019 under the authorized program, leaving $191,378 thousand available for future repurchases Common Stock Purchases (Three-month period ended March 31, 2019) | Period | Total Number of Shares Purchased | Average Price per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs | | :--------------------------- | :------------------------------- | :---------------------- | :------------------------------------------------------------------------------- | :--------------------------------------------------------------------------------------- | | January 1 - January 27, 2019 | — | $— | — | $191,378,000 | | January 28 - February 24, 2019 | — | $— | — | $191,378,000 | | February 25 - March 31, 2019 | — | $— | — | $191,378,000 | | Total | — | $— | — | $191,378,000 | - No shares were repurchased during the first quarter of 2019 under the $200 million stock repurchase program authorized in October 2018[105] Item 3. Defaults Upon Senior Securities No defaults upon senior securities occurred during the reporting period - No defaults upon senior securities[105] Item 4. Mine Safety Disclosures This item is not applicable to the Company's operations - Not applicable[105] Item 5. Other Information The Shareholder Rights Agreement expired on December 5, 2018, and Series E Preferred Stock was eliminated effective April 26, 2019 - Shareholder Rights Agreement and associated rights expired on December 5, 2018[105] - Series E Junior Participating Cumulative Preferred Stock was eliminated effective April 26, 2019[105] Item 6. Exhibits This section lists all exhibits filed with the Form 10-Q, including organizational documents, CEO/CFO certifications, and XBRL financial data - Includes organizational documents (Restated Articles of Organization, Articles of Amendment), CEO/CFO certifications (Rule 13a-14(a)/15d-14(a) and 18 U.S.C. 1350), and XBRL financial data[107] Signatures The report is signed by the President and CEO, and SVP of Finance and CFO, on April 29, 2019, certifying its submission - Report signed by Robert J. Willett (President and CEO) and John J. Curran (SVP of Finance and CFO) on April 29, 2019[110]