Arhaus(ARHS) - 2023 Q2 - Quarterly Report

Part I - Financial Information This section presents the unaudited condensed consolidated financial statements and management's discussion and analysis of financial condition Item 1. Financial Statements of Arhaus, Inc. and Subsidiaries Presents unaudited condensed consolidated financial statements, including balance sheets, income, equity, and cash flow statements, with detailed notes Condensed Consolidated Balance Sheets (unaudited) Provides a snapshot of the company's assets, liabilities, and equity at specific reporting dates Condensed Consolidated Balance Sheets (amounts in thousands) | Item | June 30, 2023 | December 31, 2022 | | :----------------------------------- | :------------ | :------------------ | | Assets | | | | Total current assets | $521,047 | $478,051 | | Total assets | $1,045,279 | $931,792 | | Liabilities and Stockholders' Equity | | | | Total current liabilities | $344,627 | $373,783 | | Total liabilities | $757,715 | $722,097 | | Total Arhaus, Inc. stockholders' equity | $287,564 | $209,695 | - Total assets increased by $113.5 million (12.2%) from December 31, 2022, to June 30, 2023, primarily driven by increases in cash and cash equivalents, merchandise inventory, and operating right-of-use assets[7] - Total stockholders' equity increased by $77.9 million (37.2%) from December 31, 2022, to June 30, 2023, mainly due to an increase in retained earnings[7] Condensed Consolidated Statements of Comprehensive Income (unaudited) Details the company's financial performance, including net revenue, gross margin, and net income over specific periods Condensed Consolidated Statements of Comprehensive Income (amounts in thousands, except per share data) | Item | Six months ended June 30, 2023 | Six months ended June 30, 2022 | Three months ended June 30, 2023 | Three months ended June 30, 2022 | | :----------------------------------- | :----------------------------- | :----------------------------- | :------------------------------- | :------------------------------- | | Net revenue | $617,467 | $552,565 | $312,899 | $306,265 | | Gross margin | $268,358 | $230,743 | $140,120 | $133,026 | | Income from operations | $99,445 | $73,121 | $53,989 | $50,252 | | Net and comprehensive income | $74,282 | $52,697 | $40,183 | $36,639 | | Net and comprehensive income per share, basic | $0.53 | $0.38 | $0.29 | $0.27 | | Net and comprehensive income per share, diluted | $0.53 | $0.38 | $0.29 | $0.26 | - Net revenue increased by 11.7% for the six months ended June 30, 2023, and by 2.2% for the three months ended June 30, 2023, compared to the respective prior periods[9] - Net and comprehensive income increased by 40.9% for the six months ended June 30, 2023, and by 9.7% for the three months ended June 30, 2023, year-over-year[9] Condensed Consolidated Statements of Changes in Stockholders' Equity (unaudited) Outlines changes in the company's equity, reflecting net income, equity-based compensation, and other adjustments Condensed Consolidated Statements of Changes in Stockholders' Equity (amounts in thousands) | Item | Balances as of Dec 31, 2022 | Six Months Ended June 30, 2023 | | :----------------------------------- | :-------------------------- | :----------------------------- | | Total Stockholders' Equity | $209,695 | $287,564 | | Net income | — | $74,282 | | Equity based compensation | — | $3,904 | | Shares withheld for taxes | — | $(347) | | Item | Balances as of March 31, 2023 | Three Months Ended June 30, 2023 | | :----------------------------------- | :---------------------------- | :------------------------------- | | Total Stockholders' Equity | $245,094 | $287,564 | | Net income | — | $40,183 | | Equity based compensation | — | $2,274 | - Total stockholders' equity increased from $209.7 million at December 31, 2022, to $287.6 million at June 30, 2023, primarily due to net income of $74.3 million and equity-based compensation[13] Condensed Consolidated Statements of Cash Flows (unaudited) Summarizes cash inflows and outflows from operating, investing, and financing activities over specific periods Condensed Consolidated Statements of Cash Flows (amounts in thousands) | Activity | Six months ended June 30, 2023 | Six months ended June 30, 2022 | | :----------------------------------- | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $61,795 | $41,110 | | Net cash used in investing activities | $(32,482) | $(20,355) | | Net cash used in financing activities | $(477) | $(50) | | Net increase in cash, cash equivalents and restricted cash equivalents | $28,836 | $20,705 | | Cash, cash equivalents and restricted cash equivalents, end of period | $181,363 | $151,613 | - Net cash provided by operating activities increased by $20.7 million (50.3%) for the six months ended June 30, 2023, compared to the same period in 2022[21] - Net cash used in investing activities increased by $12.1 million (59.6%) for the six months ended June 30, 2023, primarily due to increased purchases of property, furniture, and equipment[21] Notes to Condensed Consolidated Financial Statements (unaudited) Provides detailed explanations of the company's accounting policies, financial line items, and other relevant disclosures Note 1. Nature of Business and Basis of Presentation Arhaus, Inc. is a premium home furnishings retailer, with financial statements prepared under U.S. GAAP, including key accounting estimates and revenue recognition policies - Arhaus, Inc. operates as a premium retailer in the home furnishings market, with 85 Showrooms as of June 30, 2023, and an e-commerce platform[24] - Gift card liability decreased from $1.0 million at December 31, 2022, to $0.4 million at June 30, 2023, with breakage income for the six and three months ended June 30, 2023, being $0.7 million[32] - The Company earned $3.3 million and $1.8 million in interest income for the six and three months ended June 30, 2023, respectively, from money market funds and other Level 1 cash and cash equivalent investments[35] Note 2. Recently Issued Accounting Standards Details the adoption status of new accounting standards, noting no material impact from recent updates or future adoptions - No material impact from new accounting standards adopted in fiscal 2023[36] - ASU 2023-01 (Leases: Common Control Arrangements) will be adopted on January 1, 2024, and is not expected to have a material impact[37][38] Note 3. Merchandise Warranties Explains the company's merchandise warranty policy and reconciles the estimated liability for product warranties over time Merchandise Warranty Liability Reconciliation (amounts in thousands) | Item | Six months ended June 30, 2023 | Six months ended June 30, 2022 | Three months ended June 30, 2023 | Three months ended June 30, 2022 | | :----------------------------------- | :----------------------------- | :----------------------------- | :------------------------------- | :------------------------------- | | Balance as of beginning of period | $6,375 | $4,724 | $6,465 | $4,963 | | Accruals during the period | $6,749 | $5,104 | $3,368 | $2,908 | | Settlements during the period | $(6,546) | $(4,416) | $(3,255) | $(2,459) | | Balance as of end of the period | $6,578 | $5,412 | $6,578 | $5,412 | - Merchandise warranty liability increased to $6.6 million at June 30, 2023, from $6.4 million at the beginning of the period[40] Note 4. Long-Term Debt Describes the company's revolving credit facility, its terms, and compliance with debt covenants, noting no outstanding borrowings - The 2021 Credit Facility was amended in December 2022, increasing the revolving credit commitment to $75.0 million[42] - As of June 30, 2023, the Company had no borrowings on the 2021 Credit Facility and was in compliance with all debt covenants[42][43] - Deferred financing costs related to the credit facility were $0.4 million, amortized over the term[42] Note 5. Leases Outlines the company's operating and finance lease arrangements, including related party leases, total lease costs, and future lease liabilities Lease Assets and Liabilities (amounts in thousands) | Item | June 30, 2023 | December 31, 2022 | | :----------------------------------- | :------------ | :------------------ | | Total leased assets | $349,190 | $290,577 | | Total operating lease liabilities | $394,381 | $329,615 | | Total finance lease liabilities | $54,797 | $52,366 | Total Lease Costs (amounts in thousands) | Period | 2023 | 2022 | | :----------------------------------- | :--- | :--- | | Six months ended June 30, | $48,132 | $40,474 | | Three months ended June 30, | $24,058 | $21,287 | Weighted Average Lease Terms and Discount Rates | Item | June 30, 2023 | June 30, 2022 | | :----------------------------------- | :------------ | :------------ | | Operating leases (remaining term in years) | 9.42 | 8.74 | | Finance leases (remaining term in years) | 21.24 | 22.87 | | Operating leases (discount rate) | 5.82% | 4.32% | | Finance leases (discount rate) | 9.63% | 9.72% | Future Lease Liabilities at June 30, 2023 (amounts in thousands) | Year Ending December 31, | Operating Lease Liabilities | Finance Lease Liabilities | Total Lease Liabilities | | :----------------------- | :-------------------------- | :------------------------ | :---------------------- | | Remainder of 2023 | $29,778 | $2,873 | $32,651 | | 2024 | $63,255 | $5,758 | $69,013 | | 2025 | $57,966 | $5,758 | $63,724 | | 2026 | $54,852 | $6,217 | $61,069 | | 2027 | $51,037 | $6,028 | $57,065 | | 2028 | $45,828 | $5,527 | $51,355 | | Thereafter | $221,991 | $109,943 | $331,934 | | Total lease payments | $524,707 | $142,104 | $666,811 | | Less: Amounts representing interest | $(130,326) | $(87,307) | $(217,633) | | Total | $394,381 | $54,797 | $449,178 | Note 6. Equity Based Compensation Details the company's equity incentive plan, compensation expenses for various awards, and unrecognized compensation balances Restricted Stock Activity (six months ended June 30, 2023) | Item | Amount | | :----------------------------------- | :------------- | | Unvested at December 31, 2022 | 1,510,269 | | Vested | (932,852) | | Unvested at June 30, 2023 | 577,417 | Equity Based Compensation Expense (amounts in thousands) | Item | Six months ended June 30, 2023 | Six months ended June 30, 2022 | Three months ended June 30, 2023 | Three months ended June 30, 2022 | | :----------------------------------- | :----------------------------- | :----------------------------- | :------------------------------- | :------------------------------- | | Restricted Stock | $1,360 | $1,389 | $662 | $692 | | PSUs | $1,245 | $0 | $812 | $0 | | RSUs | $1,299 | $0 | $800 | $0 | - Total unrecognized equity-based compensation for Restricted Stock is $7.5 million (weighted average period of 2.89 years), for PSUs is $5.3 million (1.93 years), and for RSUs is $6.2 million (2.27 years) as of June 30, 2023[59][65] Note 7. Segment Reporting Confirms Arhaus operates as a single reportable segment, providing net revenue breakdown by merchandise sales channel - The Company operates as one operating segment, offering furniture, outdoor, lighting, textiles, and décor[66] Net Revenue by Merchandise Sales Channel (amounts in thousands) | Channel | Six months ended June 30, 2023 | Six months ended June 30, 2022 | Three months ended June 30, 2023 | Three months ended June 30, 2022 | | :----------------------------------- | :----------------------------- | :----------------------------- | :------------------------------- | :------------------------------- | | Retail | $506,838 | $458,965 | $256,736 | $256,395 | | eCommerce | $110,629 | $93,600 | $56,163 | $49,870 | | Total net revenue | $617,467 | $552,565 | $312,899 | $306,265 | Note 8. Net and Comprehensive Income per Share Explains the calculation of basic and diluted net and comprehensive income per share, including factors affecting share counts Net and Comprehensive Income Per Share (amounts in thousands except share and per share data) | Item | Six months ended June 30, 2023 | Six months ended June 30, 2022 | Three months ended June 30, 2023 | Three months ended June 30, 2022 | | :----------------------------------- | :----------------------------- | :----------------------------- | :------------------------------- | :------------------------------- | | Net and comprehensive income | $74,282 | $52,697 | $40,183 | $36,639 | | Weighted-average common shares outstanding, basic | 139,232,238 | 137,662,601 | 139,389,967 | 137,840,691 | | Weighted-average common shares outstanding, diluted | 139,959,943 | 139,394,055 | 139,979,928 | 139,454,109 | | Net and comprehensive income per share, basic | $0.53 | $0.38 | $0.29 | $0.27 | | Net and comprehensive income per share, diluted | $0.53 | $0.38 | $0.29 | $0.26 | - 710,490 and 773,662 shares of unvested restricted stock and RSUs were excluded from diluted EPS computation for the six and three months ended June 30, 2023, respectively, due to their anti-dilutive effect[71] Note 9. Commitments and Contingencies Addresses the company's involvement in legal proceedings and tax inquiries, assessing their potential financial impact - Management believes current litigation and claims will not have a material adverse effect on the Company's financial position, results of operations, or cash flows[72] - Liabilities for non-income tax matters were $0.3 million at June 30, 2023, and $0.4 million at December 31, 2022[73] Note 10. Related Party Transactions Details lease agreements and accounts payable with entities where the CEO and a Director have ownership interests - Lease agreement for Walton Hills warehouse with Pagoda Partners, LLC (CEO indirectly owns 50%) extended to April 2034; rent expense was $0.7 million for six months ended June 30, 2023[74] - Lease agreement for Brooklyn Outlet with Brooklyn Arhaus (CEO and Director own 85% and 15%) has monthly payments of $20 thousand; rent expense was $0.2 million for six months ended June 30, 2023[75] - Lease agreement for distribution center and manufacturing building with Premier Conover, LLC (CEO indirectly owns 40%) has monthly payments ranging from $0.2 million to $0.3 million; rent expense was $2.0 million for six months ended June 30, 2023[76] - Accounts payable due to related parties for state and federal income tax refunds were $1.8 million at June 30, 2023, and December 31, 2022[77] Note 11. Income Taxes Presents income tax expense and effective tax rates for the reported periods, noting no unrecognized tax benefits Income Tax Expense and Effective Tax Rate (amounts in millions) | Period | Income Tax Expense | Effective Tax Rate | | :----------------------------------- | :----------------- | :----------------- | | Six months ended June 30, 2023 | $26.5 | 26.3% | | Six months ended June 30, 2022 | $18.3 | 25.8% | | Three months ended June 30, 2023 | $14.4 | 26.3% | | Three months ended June 30, 2022 | $12.4 | 25.3% | - No unrecognized tax benefits have been recognized as of June 30, 2023[80] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Provides management's perspective on financial condition, results of operations, liquidity, capital resources, and critical accounting policies Overview Arhaus is a rapidly growing premium home furnishings retailer with an omni-channel model, achieving significant net revenue and income - Arhaus is a rapidly growing lifestyle brand and premium retailer in the U.S. home furnishings market, specializing in livable luxury and globally-sourced, heirloom-quality merchandise[85][86] - The Company operated 85 Showrooms at June 30, 2023, up from 81 at December 31, 2022, with 71 offering in-home interior designers[87][92] Key Financial Highlights (amounts in millions) | Period | Net Revenue | Gross Margin | Net and Comprehensive Income | | :----------------------------------- | :---------- | :----------- | :--------------------------- | | Six months ended June 30, 2023 | $617.5 | $268.4 | $74.3 | | Three months ended June 30, 2023 | $312.9 | $140.1 | $40.2 | How We Assess the Performance of Our Business Explains key GAAP and non-GAAP financial measures used to evaluate business performance, including Net Revenue, Demand, Comparable Growth, and Adjusted EBITDA - Demand is an operating metric measuring the dollar value of client orders placed, net of cancellations and returns, which eventually becomes net revenue[90] - Comparable growth measures year-over-year percentage change of delivered orders from comparable Showrooms (open for at least 15 consecutive months) and eCommerce[91] - Adjusted EBITDA is defined as consolidated net income before depreciation and amortization, interest expense (income), net, income tax expense, equity-based compensation, and other expenses (e.g., consulting, project start-up costs, severance)[98][101] Reconciliation of Net and Comprehensive Income to EBITDA and Adjusted EBITDA (amounts in thousands) | Item | Six months ended June 30, 2023 | Six months ended June 30, 2022 | Three months ended June 30, 2023 | Three months ended June 30, 2022 | | :----------------------------------- | :----------------------------- | :----------------------------- | :------------------------------- | :------------------------------- | | Net income | $74,282 | $52,697 | $40,183 | $36,639 | | Interest expense (income), net | $(651) | $2,616 | $(478) | $1,316 | | Income tax expense | $26,474 | $18,283 | $14,372 | $12,414 | | Depreciation and amortization | $14,140 | $11,995 | $7,400 | $6,119 | | EBITDA | $114,245 | $85,591 | $61,477 | $56,488 | | Equity based compensation | $3,904 | $1,389 | $2,274 | $692 | | Other expenses | $437 | $4,658 | $0 | $3,258 | | Adjusted EBITDA | $118,586 | $91,638 | $63,751 | $60,438 | Factors Affecting the Comparability of our Results of Operations Discusses how showroom openings and closings impact the comparability of the company's financial results across periods - In the six months ended June 30, 2023, the Company opened six Showrooms and closed two (related to relocations)[103] - During the year ended December 31, 2022, four Showrooms were opened and two were closed (one due to relocation)[103] Results of Operations Details the financial performance for the six and three months ended June 30, 2023, compared to the same periods in 2022, across key income statement items Statement of Condensed Consolidated Comprehensive Income Data (amounts in thousands) | Item | Six months ended June 30, 2023 | Six months ended June 30, 2022 | Three months ended June 30, 2023 | Three months ended June 30, 2022 | | :----------------------------------- | :----------------------------- | :----------------------------- | :------------------------------- | :------------------------------- | | Net revenue | $617,467 | $552,565 | $312,899 | $306,265 | | Cost of goods sold | $349,109 | $321,822 | $172,779 | $173,239 | | Gross margin | $268,358 | $230,743 | $140,120 | $133,026 | | Selling, general and administrative expenses | $168,913 | $157,622 | $86,131 | $82,774 | | Income from operations | $99,445 | $73,121 | $53,989 | $50,252 | | Interest expense (income), net | $(651) | $2,616 | $(478) | $1,316 | | Other income | $(660) | $(475) | $(88) | $(117) | | Income before taxes | $100,756 | $70,980 | $54,555 | $49,053 | | Income tax expense | $26,474 | $18,283 | $14,372 | $12,414 | | Net and comprehensive income | $74,282 | $52,697 | $40,183 | $36,639 | Other Operational Data | Item | Six months ended June 30, 2023 | Six months ended June 30, 2022 | Three months ended June 30, 2023 | Three months ended June 30, 2022 | | :----------------------------------- | :----------------------------- | :----------------------------- | :------------------------------- | :------------------------------- | | Comparable growth | 8.9% | 53.1% | (0.8)% | 65.2% | | Demand comparable growth | 8.5% | 14.7% | 11.6% | 22.5% | | Gross margin as a % of net revenue | 43.5% | 41.8% | 44.8% | 43.4% | | SG&A as a % of net revenue | 27.4% | 28.5% | 27.5% | 27.0% | | Income from operations as a % of net revenue | 16.1% | 13.2% | 17.3% | 16.4% | | Net and comprehensive income as a % of net revenue | 12.0% | 9.5% | 12.8% | 12.0% | | Adjusted EBITDA | $118,586 | $91,638 | $63,751 | $60,438 | | Adjusted EBITDA as a % of net revenue | 19.2% | 16.6% | 20.4% | 19.7% | | Total Showrooms at end of period | 85 | 80 | 85 | 80 | Comparison of the six months ended June 30, 2023 and 2022 Analyzes the financial performance for the six months ended June 30, 2023, highlighting increases in net revenue, gross margin, and net income - Net revenue increased by $64.9 million (11.7%) to $617.5 million, driven by increased demand in Showrooms and eCommerce[109] - Gross margin increased by $37.6 million (16.3%) to $268.4 million, with gross margin as a percentage of net revenue increasing 170 basis points to 43.5%, primarily due to favorable product (190 bps) and transportation costs (10 bps)[110][111] - SG&A expenses increased by $11.3 million (7.2%) to $168.9 million, mainly due to increased corporate and selling expenses, partially offset by decreased warehouse expenses, while as a percentage of net revenue, SG&A decreased 110 basis points to 27.4%[112] - Net and comprehensive income increased by $21.6 million (40.9%) to $74.3 million[115] Comparison of the three months ended June 30, 2023 and 2022 Analyzes the financial performance for the three months ended June 30, 2023, highlighting increases in net revenue, gross margin, and net income - Net revenue increased by $6.6 million (2.2%) to $312.9 million, driven by increased demand[116] - Gross margin increased by $7.1 million (5.3%) to $140.1 million, with gross margin as a percentage of net revenue increasing 140 basis points to 44.8%, primarily due to lower product costs (200 bps)[117][118] - SG&A expenses increased by $3.4 million (4.1%) to $86.1 million, mainly due to increased corporate and selling expenses, partially offset by decreased warehouse expenses, while as a percentage of net revenue, SG&A increased 50 basis points to 27.5%[119] - Net and comprehensive income increased by $3.5 million (9.7%) to $40.2 million[122] Liquidity and Capital Resources Discusses the company's cash position, credit facility, operating cash flow sufficiency, and projected capital expenditures Liquidity Outlook Assesses the company's strong liquidity position, including cash and credit facility availability, and projected sufficiency of operating cash flows - As of June 30, 2023, the Company had cash and cash equivalents of $176.8 million[123] - The Company has a $75.0 million revolving credit facility with no borrowings outstanding as of June 30, 2023[125] - Operating cash flows are expected to be sufficient to meet working capital and other capital needs for at least the next 12 months[125] Capital Expenditures Outlines historical and projected capital expenditures, primarily for new showrooms and infrastructure, net of landlord contributions - Total capital expenditures, net of landlord contributions, increased by $10.3 million for the six months ended June 30, 2023, compared to the same period in 2022[137] - Anticipated total company-funded capital expenditures for fiscal year 2023 are between $70 million and $80 million, primarily for new Showrooms[138] Cash Flow Analysis Analyzes cash flows from operating, investing, and financing activities, detailing changes and their primary drivers Summary of Cash Flows (amounts in thousands) | Activity | Six months ended June 30, 2023 | Six months ended June 30, 2022 | | :----------------------------------- | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $61,795 | $41,110 | | Net cash used in investing activities | $(32,482) | $(20,355) | | Net cash used in financing activities | $(477) | $(50) | | Net increase (decrease) in cash, cash equivalents and restricted cash equivalents | $28,836 | $20,705 | - Net cash provided by operating activities increased to $61.8 million for the six months ended June 30, 2023, from $41.1 million in the prior year, primarily due to higher net income and non-cash adjustments, despite a $61.9 million use of cash from working capital[133][134] - Net cash used in investing activities was $32.5 million for the six months ended June 30, 2023, mainly for purchases of property, furniture, and equipment[135] - Net cash used in financing activities was $0.5 million for the six months ended June 30, 2023, primarily due to share repurchases for withholding taxes on equity-based compensation[139] Off-Balance Sheet Transactions Confirms the absence of any material off-balance sheet arrangements as of the reporting date - The Company has no material off-balance sheet arrangements as of June 30, 2023[140] Critical Accounting Policies and Estimates Refers to the Annual Report on Form 10-K for a detailed description of critical accounting policies and estimates - Critical accounting policies and estimates are detailed in the Annual Report on Form 10-K for the year ended December 31, 2022[141] Recent Accounting Pronouncements Directs readers to Note 2 of the financial statements for information on recently issued accounting standards - Refer to Note 2 for information on recently issued accounting standards[142] Item 3. Quantitative and Qualitative Disclosures About Market Risk Assesses the company's exposure to market risks, including foreign currency, interest rates, and inflation, and their potential impact - Foreign currency exchange rate fluctuations are not significant due to the majority of international inventory purchases being denominated in U.S. dollars[144] - A 100 basis point change in interest rates is not expected to have a material impact on financial condition or results of operations, given no current borrowings on the 2021 Credit Facility[145] - The Company has historically been able to recover cost increases due to inflation (labor, material, transportation) through price increases[146] Item 4. Controls and Procedures Reports on the ineffectiveness of disclosure controls and procedures due to material weaknesses in internal control over financial reporting - Disclosure controls and procedures were not effective at the reasonable assurance level as of June 30, 2023[148] - Four material weaknesses were identified in internal control over financial reporting, including: (1) lack of sufficient accounting knowledge and segregation of duties, (2) inadequate accounting policies and controls, (3) ineffective controls for non-routine/complex transactions (e.g., incentive unit plan), and (4) ineffective IT general controls[148][150][152] - A remediation plan is being implemented, including updating policies, enhancing financial reporting procedures, improving user access controls, hiring qualified personnel, and strengthening IT change management and development controls[154] Part II. Other Information Presents additional information not covered in Part I, including legal proceedings, risk factors, equity sales, and other disclosures Item 1. Legal Proceedings States that there are no legal proceedings that would have a material adverse effect on the company's financial position - The Company is not currently a party to any legal proceedings that would have a material adverse effect on its business, financial condition, or results of operations[160] Item 1A. Risk Factors Confirms no material changes to the risk factors previously disclosed in the Annual Report on Form 10-K - No material changes from the risk factors disclosed in the Annual Report on Form 10-K for the year ended December 31, 2022[161] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds Reports no publicly announced share repurchases, with any shares purchased related to tax withholding for equity vesting - No shares were purchased as part of publicly announced share repurchase programs during the three months ended June 30, 2023[162][163] - Shares delivered by employees to satisfy tax withholding obligations upon vesting of restricted stock are not considered part of publicly announced repurchase programs[162] Item 3. Defaults Upon Senior Securities Confirms that the company has not defaulted on any senior securities - No defaults upon senior securities[163] Item 4. Mine Safety Disclosures States that the company has no mine safety disclosures to report - No mine safety disclosures[163] Item 5. Other Information Announces the separation of the Chief Operating Officer, effective August 8, 2023 - Tim Kuckelman, Chief Operating Officer, separated from the Company effective August 8, 2023[164] Item 6. Exhibits Lists the exhibits filed as part of the Form 10-Q, including certificates, XBRL taxonomy documents, and other corporate governance documents - Includes Certificates of CEO and CFO (31.1, 31.2, 32.1, 32.2) and XBRL Interactive Data Files (101.INS, 101.SCH, 101.CAL, 101.DEF, 101.LAB, 101.PRE, 104)[166] Signatures Indicates the report was duly signed by the Chief Financial Officer on August 9, 2023 - The report was signed by Dawn Phillipson, Chief Financial Officer, on August 9, 2023[168][169]