American Woodmark (AMWD) - 2022 Q1 - Quarterly Report

PART I. FINANCIAL INFORMATION This section provides the unaudited condensed consolidated financial statements and management's discussion and analysis for the period ended July 31, 2021 Item 1. Financial Statements This section presents the unaudited condensed consolidated financial statements, including balance sheets, income statements, comprehensive income, shareholders' equity, and cash flows, along with detailed notes explaining accounting policies, financial instrument details, and other relevant disclosures for the period ended July 31, 2021 Condensed Consolidated Balance Sheets This section presents the company's financial position, detailing assets, liabilities, and equity as of July 31, 2021, and April 30, 2021 Condensed Consolidated Balance Sheets (in thousands) | Metric | July 31, 2021 | April 30, 2021 | | :---------------------------------- | :------------ | :------------- | | Total Current Assets | $355,420 | $409,965 | | Total Assets | $1,589,585 | $1,654,399 | | Total Current Liabilities | $198,817 | $220,447 | | Long-term Debt, less current maturities | $491,412 | $513,450 | | Total Shareholders' Equity | $737,101 | $756,238 | - Cash and cash equivalents decreased significantly from $91,071 thousand at April 30, 2021, to $27,818 thousand at July 31, 2021[6] Condensed Consolidated Statements of Income This section presents the company's financial performance, including net sales, gross profit, operating income, and net income for the three months ended July 31, 2021 and 2020 Condensed Consolidated Statements of Income (in thousands, except per share data) | Metric | Three Months Ended July 31, 2021 | Three Months Ended July 31, 2020 (As Adjusted) | | :---------------------------------- | :------------------------------- | :--------------------------------------------- | | Net Sales | $442,581 | $390,087 | | Gross Profit | $53,443 | $79,567 | | Operating Income | $6,456 | $26,226 | | Net Income | $2,981 | $16,059 | | Basic Net Earnings Per Share | $0.18 | $0.95 | - Net sales increased by 13.5% year-over-year, while gross profit decreased by 32.8% and net income decreased by 81.4% for the three months ended July 31, 2021, compared to the same period in 2020[9][104] Condensed Consolidated Statements of Comprehensive Income This section presents the company's comprehensive income, including net income and other comprehensive income items for the three months ended July 31, 2021 and 2020 Condensed Consolidated Statements of Comprehensive Income (in thousands) | Metric | Three Months Ended July 31, 2021 | Three Months Ended July 31, 2020 (As Adjusted) | | :---------------------------------- | :------------------------------- | :--------------------------------------------- | | Net Income | $2,981 | $16,059 | | Change in pension benefits, net of deferred taxes | $373 | $327 | | Change in cash flow hedges (swap) | $(573) | $— | | Total Comprehensive Income | $2,781 | $16,386 | Condensed Consolidated Statements of Shareholders' Equity This section details changes in the company's shareholders' equity, including common stock, retained earnings, and accumulated other comprehensive loss Condensed Consolidated Statements of Shareholders' Equity (in thousands) | Metric | July 31, 2021 | April 30, 2021 | | :---------------------------------- | :------------ | :------------- | | Common Stock | $359,732 | $362,524 | | Retained Earnings | $432,137 | $448,282 | | Accumulated Other Comprehensive Loss | $(54,768) | $(54,568) | | Total Shareholders' Equity | $737,101 | $756,238 | - The company repurchased 299,781 common shares for $25.0 million during the three months ended July 31, 2021, contributing to a decrease in total shareholders' equity[15][125][126] Condensed Consolidated Statements of Cash Flows This section presents the company's cash inflows and outflows from operating, investing, and financing activities for the three months ended July 31, 2021 and 2020 Condensed Consolidated Statements of Cash Flows (in thousands) | Activity | Three Months Ended July 31, 2021 | Three Months Ended July 31, 2020 (As Adjusted) | | :---------------------------------- | :------------------------------- | :--------------------------------------------- | | Net Cash Provided by Operating Activities | $6,588 | $40,000 | | Net Cash Used by Investing Activities | $(14,706) | $(7,836) | | Net Cash Used by Financing Activities | $(55,135) | $(1,168) | | Net Decrease in Cash and Cash Equivalents | $(63,253) | $30,996 | | Cash and Cash Equivalents, End of Period | $27,818 | $128,055 | - The significant increase in cash used by financing activities was primarily due to $29.1 million in long-term debt payments and $25.0 million in common stock repurchases during the first three months of fiscal 2022[125] Notes to Condensed Consolidated Financial Statements This section provides detailed explanations of the accounting policies, financial instrument details, and other relevant disclosures supporting the condensed consolidated financial statements Note A--Basis of Presentation This note outlines the basis of financial statement presentation, including the change in inventory valuation method and the impact of the COVID-19 pandemic - The company retrospectively changed its inventory valuation method from LIFO to FIFO effective May 1, 2021, to achieve uniformity, improve comparability, and better reflect current inventory value and physical flow[24][26] Impact of LIFO to FIFO Accounting Change (Three Months Ended July 31, 2021, in thousands) | Metric | Computed under previous method | Effect of Change | Reported under FIFO | | :---------------------------------- | :----------------------------- | :--------------- | :------------------ | | Cost of Sales and Distribution | $391,342 | $(2,204) | $389,138 | | Net Income | $1,352 | $1,629 | $2,981 | | Basic Net Earnings Per Share | $0.08 | $0.10 | $0.18 | | Inventories (as of July 31, 2021) | $179,590 | $2,204 | $181,794 | | Retained Earnings (as of July 31, 2021) | $430,508 | $1,629 | $432,137 | - The COVID-19 pandemic continues to negatively impact the company through decreased demand, supply chain disruptions, material availability, transportation delays, and challenges in hiring and retaining employees[23][99] Note B--New Accounting Pronouncements This note discusses the impact of recently adopted and issued accounting pronouncements on the company's financial statements - The company does not expect ASU 2020-04 (Reference Rate Reform) to materially impact its consolidated financial statements, despite identifying LIBOR-influenced financial instruments[42] - The adoption of ASU 2019-12 (Income Taxes) effective May 1, 2021, did not have an impact on the company's financial position or results of operations[43] Note C--Net Earnings Per Share This note provides a detailed calculation of basic and diluted net earnings per share for the periods presented Net Earnings Per Share (in thousands, except per share amounts) | Metric | Three Months Ended July 31, 2021 | Three Months Ended July 31, 2020 (As Adjusted) | | :---------------------------------- | :------------------------------- | :--------------------------------------------- | | Net Income | $2,981 | $16,059 | | Denominator for Basic EPS (weighted-average shares) | 16,661 | 16,937 | | Denominator for Diluted EPS (weighted-average shares) | 16,716 | 17,013 | | Basic Net Earnings Per Share | $0.18 | $0.95 | | Diluted Net Earnings Per Share | $0.18 | $0.94 | Note D--Stock-Based Compensation This note details the company's stock-based compensation plans, including RSU grants and recognized expenses - During the three months ended July 31, 2021, the company granted 57,476 performance-based RSUs and 30,984 service-based RSUs to key employees, all cliff-vesting three years from the grant date[46] Stock-Based Compensation Expense (in thousands) | Allocation | Three Months Ended July 31, 2021 | Three Months Ended July 31, 2020 | | :---------------------------------- | :------------------------------- | :------------------------------- | | Cost of Sales and Distribution | $349 | $300 | | Selling and Marketing Expenses | $319 | $252 | | General and Administrative Expenses | $509 | $409 | | Total Stock-Based Compensation Expense | $1,177 | $961 | - The company also granted cash-settled performance-based RSTUs (5,794 units) and service-based RSTUs (3,096 units) to junior-level employees, with a recognized expense of $0.1 million for the three months ended July 31, 2021[48][49] Note E--Customer Receivables This note presents the breakdown of customer receivables, including allowances for doubtful accounts, returns, and discounts Customer Receivables (in thousands) | Component | July 31, 2021 | April 30, 2021 | | :---------------------------------- | :------------ | :------------- | | Gross Customer Receivables | $139,498 | $156,187 | | Less: Allowance for Doubtful Accounts | $(220) | $(331) | | Less: Allowance for Returns and Discounts | $(8,542) | $(8,990) | | Net Customer Receivables | $130,736 | $146,866 | Note F--Inventories This note provides a detailed breakdown of inventory components, including raw materials, work-in-process, and finished goods Inventories (in thousands) | Component | July 31, 2021 | April 30, 2021 (As Adjusted) | | :---------------------------------- | :------------ | :--------------------------- | | Raw Materials | $80,700 | $63,384 | | Work-in-Process | $55,875 | $51,176 | | Finished Goods | $45,219 | $43,607 | | Total Inventories | $181,794 | $158,167 | - Total inventories increased by $23.6 million from April 30, 2021, to July 31, 2021, primarily driven by an increase in raw materials[51] Note G--Property, Plant and Equipment This note details the company's property, plant, and equipment, including depreciation and amortization expenses Property, Plant and Equipment (in thousands) | Component | July 31, 2021 | April 30, 2021 | | :---------------------------------- | :------------ | :------------- | | Land | $4,431 | $4,431 | | Buildings and Improvements | $116,851 | $116,103 | | Machinery and Equipment | $318,651 | $315,371 | | Construction in Progress | $30,150 | $22,669 | | Total (Net) | $206,932 | $204,002 | - Depreciation and amortization expense for property, plant and equipment was $9.6 million for the three months ended July 31, 2021, a decrease from $11.6 million in the prior year, which included accelerated depreciation from a plant closure[53] Note H--Intangibles This note outlines the company's customer relationship intangibles, including accumulated amortization and related expenses Customer Relationship Intangibles (in thousands) | Component | July 31, 2021 | April 30, 2021 | | :---------------------------------- | :------------ | :------------- | | Customer Relationship Intangibles | $274,000 | $274,000 | | Less Accumulated Amortization | $(163,639) | $(152,222) | | Total (Net) | $110,361 | $121,778 | - Amortization expense for customer relationship intangibles was $11.4 million for the three months ended July 31, 2021, amortized over an estimated useful life of six years[54] Note I--Product Warranty This note describes the company's product warranty liability, including accruals and settlements based on historical claims Product Warranty Liability Reconciliation (in thousands) | Metric | Three Months Ended July 31, 2020 | | :---------------------------------- | :------------------------------- | | Beginning Balance at May 1 | $3,753 | | Accrual | $4,303 | | Settlements | $(4,138) | | Ending Balance at July 31 | $3,918 | - The company estimates warranty costs based on historical claims and revenues, with adjustments made for differences between actual and estimated experience[55] Note J--Pension Benefits This note details the company's pension plan, including termination plans, net periodic pension benefit costs, and expected contributions - The company filed an application to terminate its defined benefit pension plan effective December 31, 2020, expecting to incur approximately $1.6 million in termination costs[58] Net Periodic Pension Benefit Cost (in thousands) | Component | Three Months Ended July 31, 2021 | Three Months Ended July 31, 2020 | | :---------------------------------- | :------------------------------- | :------------------------------- | | Interest Cost | $1,349 | $1,165 | | Expected Return on Plan Assets | $(1,543) | $(2,107) | | Recognized Net Actuarial Loss | $499 | $440 | | Net Periodic Pension Benefit | $305 | $(502) | - The company expects to contribute $2.5 million to the Plan during the remainder of fiscal 2022, having made no contributions in the first three months of fiscal 2022 or in fiscal 2021[60] Note K--Fair Value Measurements This note explains the fair value measurement of financial instruments, categorizing them into Level 1, 2, and 3 inputs Fair Value of Assets and Liabilities (in thousands, as of July 31, 2021) | Instrument | Level 1 | Level 2 | Level 3 | | :---------------------------------- | :------ | :------ | :------ | | Assets: | | | | | Mutual Funds | $503 | $— | $— | | Foreign Exchange Forward Contracts | $— | $350 | $— | | Liabilities: | | | | | Interest Rate Swap Contracts | $— | $573 | $— | - The company classifies financial instruments into Level 1 (quoted prices in active markets), Level 2 (observable inputs other than Level 1 prices), and Level 3 (unobservable inputs) for fair value measurement[61][62] Note L--Loans Payable and Long-Term Debt This note details the company's credit agreement, outstanding debt, available capacity, and compliance with financial covenants - On April 22, 2021, the company amended and restated its credit agreement, establishing a $500 million revolving loan facility and a $250 million term loan facility, both maturing on April 22, 2026[67] Outstanding Debt and Available Capacity (as of July 31, 2021, in millions) | Facility | Outstanding Amount | Available Capacity | | :---------------------------------- | :----------------- | :----------------- | | Term Loan Facility | $237.5 | N/A | | Revolving Facility | $248 | $243 | | Total Long-Term Debt (including current maturities) | $493.5 | N/A | - The company was in compliance with all financial covenants of the A&R Credit Agreement as of July 31, 2021, which include maintaining a Consolidated Interest Coverage Ratio of no less than 2.00 to 1.00 and a Total Net Leverage Ratio of no greater than 4.00 to 1.00[70][71] Note M--Derivative Financial Instruments This note describes the company's use of interest rate swaps and foreign exchange forward contracts to manage market risks - On May 28, 2021, the company entered into four interest rate swaps with an aggregate notional amount of $200 million to hedge variable rate interest payments under the Term Loan Facility, converting a portion to a fixed rate of 0.5980%[73] - During the quarter ended July 31, 2021, unrealized losses of $0.6 million were recorded in other comprehensive income, and $0.2 million of realized losses were reclassified to interest expense from these swaps[75] - As of July 31, 2021, the company held foreign exchange forward contracts to purchase 516.4 million Mexican pesos, maturing from August 2021 to April 2022, to manage currency fluctuations[76] Note N--Income Taxes This note provides information on the company's effective income tax rate and the factors influencing its changes Effective Income Tax Rate | Period | Effective Tax Rate | | :---------------------------------- | :----------------- | | Three Months Ended July 31, 2021 | 29.2% | | Three Months Ended July 31, 2020 | 26.6% | - The effective income tax rate increased to 29.2% for the three months ended July 31, 2021, from 26.6% in the prior year, primarily due to state income taxes and the impact of discrete items on lower pretax income[77] Note O--Revenue Recognition This note details the company's net sales by major sales distribution channels for the periods presented Net Sales by Major Sales Distribution Channels (in thousands) | Channel | Three Months Ended July 31, 2021 | Three Months Ended July 31, 2020 | | :---------------------------------- | :------------------------------- | :------------------------------- | | Home Center Retailers | $209,324 | $173,995 | | Builders | $178,238 | $164,348 | | Independent Dealers and Distributors | $55,019 | $51,744 | | Total Net Sales | $442,581 | $390,087 | Note P--Concentration of Risks This note identifies significant customer concentrations in gross customer receivables and net sales Customer Concentration (Percentage of Gross Customer Receivables) | Customer | July 31, 2021 | July 31, 2020 | | :---------------------------------- | :------------ | :------------ | | Customer A | 31.2% | 29.0% | | Customer B | 19.6% | 25.1% | Customer Concentration (Percentage of Net Sales) | Customer | Three Months Ended July 31, 2021 | Three Months Ended July 31, 2020 | | :---------------------------------- | :------------------------------- | :------------------------------- | | Customer A | 31.8% | 27.7% | | Customer B | 15.5% | 16.9% | Note Q--Leases This note provides details on the company's lease costs, weighted-average lease terms, discount rates, and future lease payments Components of Lease Costs (in thousands) | Lease Type | Three Months Ended July 31, 2021 | Three Months Ended July 31, 2020 | | :---------------------------------- | :------------------------------- | :------------------------------- | | Finance Lease Cost (Reduction in ROU assets) | $287 | $98 | | Finance Lease Cost (Interest on lease liabilities) | $25 | $14 | | Operating Lease Cost | $6,955 | $6,706 | Weighted Average Lease Terms and Discount Rates (as of July 31, 2021) | Lease Type | Remaining Lease Term (Years) | Discount Rate | | :---------------------------------- | :--------------------------- | :------------ | | Finance Leases | 2.79 | 2.94% | | Operating Leases | 6.39 | 3.19% | Future Lease Payments (in thousands, Year Ending April 30) | Year | Operating Leases | Financing Leases | | :---------------------------------- | :--------------- | :--------------- | | 2022 | $17,969 | $1,745 | | 2023 | $23,805 | $1,962 | | 2024 | $21,817 | $1,579 | | 2025 | $18,529 | $377 | | 2026 | $18,296 | $102 | | Thereafter | $40,956 | $— | | Total Lease Liability | $127,552 | $5,544 | Note R--Restructuring This note outlines the restructuring charges incurred by the company, primarily related to plant closures and workforce reductions - The company recognized pre-tax restructuring charges of $0.3 million in the first quarter of fiscal 2022, related to the closure of its Humboldt, Tennessee manufacturing plant[91] - In the prior fiscal year, the company incurred $1.7 million in restructuring charges for workforce reductions and $1.8 million for the Humboldt plant closure[90][91] Note S--Other Information This note addresses routine legal suits and claims, confirming that the aggregate loss from probable claims is not material - The company is involved in routine legal suits and claims, but believes the aggregate range of loss from probable or reasonably possible claims was not material as of July 31, 2021[92][93] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides an overview of the company's business, the impact of COVID-19, a financial overview including market trends and sales performance, detailed results of operations, and a discussion of non-GAAP financial measures, outlook, liquidity, capital resources, and critical accounting policies Forward-Looking Statements This section highlights various risks and uncertainties that could impact future financial results, including macroeconomic factors and supply chain disruptions - The report contains forward-looking statements subject to various risks, including loss of key customers, negative macroeconomic factors (housing market, economy, unemployment), competition, raw material costs, and supply chain disruptions[94] - Other significant risks include the impact of COVID-19, inability to develop new products, manufacturing inefficiencies, goodwill impairment, information system interruptions, regulatory compliance costs, and labor developments[94] Overview This section provides a brief description of American Woodmark Corporation's business, products, and operational footprint - American Woodmark Corporation manufactures and distributes kitchen, bath, and home organization products for remodeling and new home construction markets, operating 17 manufacturing facilities and eight primary service centers[97][98] COVID-19 This section discusses the ongoing negative impacts of the COVID-19 pandemic on the company's operations, demand, and supply chain - The COVID-19 pandemic negatively impacted the company's business operations and financial results, causing decreased product demand, supply chain disruptions, material availability issues, transportation delays, and challenges in hiring and retaining employees[99] Financial Overview This section summarizes key macroeconomic trends and the company's overall sales performance and net income for the quarter Key Macroeconomic Trends (Q1 Fiscal 2022 vs. Prior Year) | Metric | July 2021 | July 2020 | Change | | :---------------------------------- | :-------- | :-------- | :----- | | Median Existing Home Price Increase | 21.9% | N/A | Up | | Existing Home Sales Increase | 33.0% | N/A | Up | | Unemployment Rate | 5.4% | 10.2% | Down | | 30-Year Fixed Mortgage Rate | 2.80% | ~2.99% | Down | | Consumer Sentiment (Thomson Reuters/U. Michigan) | 81.2 | 72.5 | Up | - Total net sales increased by 13.5% in the first quarter of fiscal 2022, with remodeling sales up 17.1% (home center up 20.3%, independent dealer up 6.3%) and new construction sales up 8.5%[101][102][103] - Net income for the first quarter of fiscal 2022 was $3.0 million, a significant decrease from $16.1 million in the comparable prior-year period[103] Results of Operations This section provides a detailed analysis of net sales, gross profit, and operating expenses, explaining period-over-period changes Key Financial Results (Three Months Ended July 31, in thousands) | Metric | 2021 | 2020 (As Adjusted) | Percent Change | | :---------------------------------- | :----- | :----------------- | :------------- | | Net Sales | $442,581 | $390,087 | 13.5% | | Gross Profit | $53,443 | $79,567 | (32.8)% | | Selling and Marketing Expenses | $22,987 | $19,898 | 15.5% | | General and Administrative Expenses | $23,687 | $29,983 | (21.0)% | - Gross profit margin decreased to 12.1% from 20.4% due to higher material and logistics costs and increased healthcare expenses, partially offset by higher sales[105] - General and administrative expenses as a percentage of net sales decreased to 5.4% from 7.7%, driven by leverage from higher sales, lower incentive costs, and absence of prior-year severance costs[106] Non-GAAP Financial Measures This section reconciles non-GAAP financial measures such as EBITDA, Adjusted EBITDA, and Adjusted EPS to their most directly comparable GAAP measures EBITDA, Adjusted EBITDA and Adjusted EBITDA margin This subsection provides a reconciliation of GAAP net income to non-GAAP EBITDA and Adjusted EBITDA, along with the Adjusted EBITDA margin Reconciliation of EBITDA and Adjusted EBITDA (in thousands) | Metric | Three Months Ended July 31, 2021 | Three Months Ended July 31, 2020 (As Adjusted) | | :---------------------------------- | :------------------------------- | :--------------------------------------------- | | Net Income (GAAP) | $2,981 | $16,059 | | EBITDA (Non-GAAP) | $30,825 | $53,123 | | Adjusted EBITDA (Non-GAAP) | $32,100 | $56,395 | | Net Sales | $442,581 | $390,087 | | Adjusted EBITDA Margin (Non-GAAP) | 7.3% | 14.5% | - Adjusted EBITDA decreased to $32.1 million (7.3% of net sales) for the first quarter of fiscal 2022, from $56.4 million (14.5% of net sales) in the prior year, primarily due to decreased net income from higher material and logistics costs and increased healthcare expenses[113][115] Adjusted EPS per diluted share This subsection reconciles GAAP EPS to non-GAAP Adjusted EPS per diluted share, excluding specific non-recurring items Reconciliation of Net Income to Adjusted Net Income (in thousands, except share data) | Metric | Three Months Ended July 31, 2021 | Three Months Ended July 31, 2020 (As Adjusted) | | :---------------------------------- | :------------------------------- | :--------------------------------------------- | | Net Income (GAAP) | $2,981 | $16,059 | | Adjusted Net Income (Non-GAAP) | $11,664 | $27,776 | | EPS per Diluted Share (GAAP) | $0.18 | $0.94 | | Adjusted EPS per Diluted Share (Non-GAAP) | $0.70 | $1.63 | - Adjusted EPS per diluted share is defined by excluding the per share impact of acquisition and restructuring expenses, non-recurring restructuring charges, amortization of customer relationship intangibles, and related tax benefits[111] Outlook This section provides the company's expectations for fiscal 2022 sales growth, margin trends, and capital allocation plans - The company expects fiscal 2022 sales to achieve mid to high single-digit growth over the prior year[116] - Margins are expected to remain challenged for the next two quarters but are anticipated to improve sequentially throughout the remainder of the year as pricing actions are fully realized[116] - The company plans to increase its capital investment rate to approximately 3.5% of net sales for the full fiscal year and may consider additional debt repayments and share repurchases[116] Liquidity and Capital Resources This section discusses the company's cash position, debt levels, operating cash flows, and financing activities Liquidity and Debt Metrics (in millions) | Metric | July 31, 2021 | April 30, 2021 | | :---------------------------------- | :------------ | :------------- | | Cash and Cash Equivalents | $27.8 | $91.1 | | Total Long-Term Debt (including current maturities) | $493.5 | $521.7 | | Long-Term Debt to Total Capital Ratio | 40.0% | 40.4% | | Available Capacity under Revolving Facility | $243.0 | $227.7 | - Net cash provided by operating activities decreased to $6.6 million in the first three months of fiscal 2022 from $40.0 million in the prior year, primarily due to lower net income and cash outflows from inventories and accrued expenses[124] - Net cash used by financing activities significantly increased to $55.1 million, driven by $29.1 million in debt payments and $25.0 million in share repurchases[125] Seasonal and Inflationary Factors This section addresses the seasonal nature of the business and the company's approach to managing inflationary pressures and commodity price fluctuations - The company's business is subject to seasonal influences, with higher sales typically in the first and fourth fiscal quarters, though general economic forces have reduced these fluctuations[128] - The company generally recovers inflationary pressures and commodity price fluctuations through sales price increases[128] Critical Accounting Policies This section confirms no significant changes to the company's critical accounting policies from the prior annual report - There have been no significant changes to the company's critical accounting policies as disclosed in its Annual Report on Form 10-K for the fiscal year ended April 30, 2021[129] Item 3. Quantitative and Qualitative Disclosures About Market Risk This section outlines the company's exposure to market risks, including interest rate risk, foreign exchange risk, and commodity price risk, and the strategies employed to manage these exposures - A 100 basis point increase in the variable interest rate component of the company's borrowings would increase annual interest expense by approximately $2.9 million[130] - The company uses foreign exchange forward contracts to offset currency fluctuations in transactions denominated in foreign currencies and entered into interest rate swaps in May 2021 to hedge approximately $200 million of its variable interest rate debt[131] - The company does not currently use commodity or similar financial instruments to manage its commodity price risks[131] Item 4. Controls and Procedures This section confirms the effectiveness of the company's disclosure controls and procedures and states that there have been no material changes to internal control over financial reporting during the quarter - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of July 31, 2021[131] - There has been no change in the company's internal control over financial reporting during the quarter ended July 31, 2021, that has materially affected, or is reasonably likely to materially affect, internal control over financial reporting[133] PART II. OTHER INFORMATION This section provides additional information including legal proceedings, risk factors, equity sales, other corporate information, and a list of exhibits Item 1. Legal Proceedings This section states that the company is involved in routine litigation incidental to its business but is not party to any material non-routine litigation - The company is not party to any material litigation that does not constitute ordinary, routine litigation incidental to its business[134] Item 1A. Risk Factors This section refers to the risk factors detailed in the company's Annual Report on Form 10-K and confirms no material changes to these risks - There have been no material changes from the risk factors disclosed in the company's Annual Report on Form 10-K for the fiscal year ended April 30, 2021[135] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds This section details the company's common stock repurchase activities during the first quarter of fiscal 2022 under a Board-authorized program Share Repurchase Activity (First Quarter Fiscal 2022) | Period | Total Shares Purchased | Average Price Paid Per Share | Approximate Dollar Value Remaining Under Programs (000) | | :---------------------------------- | :--------------------- | :--------------------------- | :------------------------------------------------------ | | May 1 - 31, 2021 | — | N/A | $100,000 | | June 1 - 30, 2021 | 299,781 | $83.36 | $75,000 | | July 1 - 31, 2021 | — | N/A | $75,000 | | Quarter ended July 31, 2021 | 299,781 | $83.36 | $75,000 | - The company repurchased 299,781 common shares for an aggregate purchase price of $25.0 million during the first fiscal quarter of 2022, with $75.0 million remaining under the $100 million authorization[126][137] Item 5. Other Information This section reports the results of the Annual Meeting of Shareholders held on August 26, 2021, including the election of directors and the approval of key proposals - Shareholders approved the election of all nine nominated directors, the ratification of KPMG LLP as the independent registered public accounting firm, and the advisory vote to approve executive compensation at the Annual Meeting[138][139][140] Item 6. Exhibits This section lists all exhibits filed as part of the Form 10-Q, including corporate governance documents, certifications, and interactive data files - Key exhibits include Articles of Incorporation, Bylaws, certifications from the CEO and CFO (pursuant to Rule 13a-14(a) and 18 U.S.C. Section 1350), and Interactive Data Files (XBRL) for the financial statements[142] SIGNATURES This section contains the official signatures for the Form 10-Q, confirming its submission by authorized personnel - The report was signed by Paul Joachimczyk, Vice President and Chief Financial Officer, on behalf of American Woodmark Corporation on August 31, 2021[144]