What changed in EAGLE MATERIALS INC's 10-K — 2022 vs 2023
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Paragraph-level year-over-year comparison of EAGLE MATERIALS INC's 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.
+136 added−213 removedSource: 10-K (2023-05-19) vs 10-K (2022-05-20)
Top changes in EAGLE MATERIALS INC's 2023 10-K
136 paragraphs added · 213 removed · 122 edited across 1 sections
- Item 7A. Quantitative and Qualitative Disclosures About Market Risk+136 / −213 · 122 edited
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
Market Risk — interest-rate, FX, commodity exposure
122 edited+14 added−91 removed83 unchanged
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
Market Risk — interest-rate, FX, commodity exposure
122 edited+14 added−91 removed83 unchanged
2022 filing
2023 filing
Biggest changeFinancial Statements and Supplementary Data Financial Information Index to Financial Statements and Related Information PAGE Eagle Materials Inc.: Consolidated Statements of Earnings for the Years Ended March 31, 2022, 2021, and 20 20 58 Consolidated Statements of Comprehensive Earnings for the Years Ended March 31, 2022, 2021, and 2020 59 Consolidated Balance Sheets as of March 31, 2022 and 2021 60 Consolidated Statements of Cash Flows for the Years Ended March 31, 2022, 2021, and 2020 61 Consolidated Statements of Stockholders’ Equity for the Years Ended March 31, 2022, 2021, and 20 20 62 Notes to Consolidated Financial Statements 63 Report of Independent Registered Public Accounting Firm 93 Auditor Name: Ernst & Young LLP Auditor Location: Dallas, Texas Auditor Firm ID: 42 Texas Lehigh Cement Company LP: Statements of Earnings for the Years Ended December 31, 2021, 2020, and 2019 96 Statements of Comprehensive Earnings for the Years Ended December 31, 2021, 2020, and 2019 97 Balance Sheets as of December 31, 2021 and 2020 98 Statements of Changes in Partners’ Capital for the Years Ended December 31, 2021, 2020, and 201 9 99 Statements of Cash Flows for the Years Ended December 31, 2021, 2020, and 201 9 100 Notes to Financial Statements 101 Report of Independent Registered Public Accounting Firm 110 57 Eagle Materials Inc. and Subsidiaries C onsolidated Statements of Earnings For the Years Ended March 31, 2022 2021 2020 (dollars in thousands, except share and per share data) Revenue $ 1,861,522 $ 1,622,642 $ 1,404,033 Cost of Goods Sold 1,341,908 1,214,287 1,061,367 Gross Profit 519,614 408,355 342,666 Equity in Earnings of Unconsolidated Joint Venture 32,488 37,441 42,585 Corporate General and Administrative Expense ( 46,801 ) ( 49,511 ) ( 65,410 ) Loss on Early Retirement of Senior Notes ( 8,407 ) — — Gain on Sale of Businesses — 51,973 — Impairment Losses — — ( 25,131 ) Other Non-Operating Income (Loss) 9,073 20,274 ( 594 ) Interest Expense, net ( 30,873 ) ( 44,420 ) ( 38,421 ) Earnings from Continuing Operations Before Income Taxes 475,094 424,112 255,695 Income Taxes ( 100,847 ) ( 89,946 ) ( 24,504 ) Earnings from Continuing Operations 374,247 334,166 231,191 Earnings (Loss) from Discontinued Operations, net of Income Taxes — 5,278 ( 160,297 ) Net Earnings $ 374,247 $ 339,444 $ 70,894 BASIC EARNINGS (LOSS) PER SHARE Continuing Operations $ 9.23 $ 8.04 $ 5.50 Discontinued Operations — 0.13 ( 3.81 ) Net Earnings $ 9.23 $ 8.17 $ 1.69 DILUTED EARNINGS (LOSS) PER SHARE Continuing Operations $ 9.14 $ 7.99 $ 5.47 Discontinued Operations — 0.13 ( 3.79 ) Net Earnings $ 9.14 $ 8.12 $ 1.68 AVERAGE SHARES OUTSTANDING Basic 40,547,048 41,543,067 42,021,892 Diluted 40,929,712 41,826,709 42,285,343 CASH DIVIDENDS PER SHARE $ 0.75 $ 0.10 $ 0.40 See Notes to Consolidated Financial Statements. 58 Eagle Materials Inc. and Subsidiaries C onsolidated Statements of Comprehensive Earnings For the Years Ended March 31, 2022 2021 2020 (dollars in thousands) Net Earnings $ 374,247 $ 339,444 $ 70,894 Net Actuarial Change in Defined Benefit Plans: Unrealized Gain During the Period, net of tax expense of $ 48 , $ 33 , and $ 41 161 101 131 Amortization of Net Actuarial Gain (Loss), net of tax (expense) benefit of $ 39 , $( 49 ), and $( 120 ) 104 ( 154 ) ( 396 ) Comprehensive Earnings $ 374,512 $ 339,391 $ 70,629 See Notes to Consolidated Financial Statements. 59 Eagle Materials Inc. and Subsidiaries C onsolidated Balance Sheets March 31, 2022 2021 (dollars in thousands) ASSETS Current Assets - Cash and Cash Equivalents $ 19,416 $ 263,520 Restricted Cash — 5,000 Accounts and Notes Receivable, net 176,276 147,133 Inventories 236,661 235,749 Income Tax Receivable 7,202 2,838 Prepaid and Other Assets 3,172 7,449 Total Current Assets 442,727 661,689 Property, Plant, and Equipment, net 1,616,539 1,659,100 Notes Receivable 8,485 8,419 Investment in Joint Venture 80,637 75,399 Operating Lease Right-of-Use Assets 23,856 25,811 Goodwill and Intangible Assets, net 387,898 392,315 Other Assets 19,510 15,948 $ 2,579,652 $ 2,838,681 LIABILITIES AND STOCKHOLDERS’ EQUITY Current Liabilities - Accounts Payable $ 113,679 $ 84,171 Accrued Liabilities 86,754 78,840 Operating Lease Liabilities 7,118 6,343 Total Current Liabilities 207,551 169,354 Long-term Debt 938,265 1,008,616 Noncurrent Operating Lease Liabilities 29,212 34,444 Other Long-term Liabilities 38,699 41,291 Deferred Income Taxes 232,369 225,986 Total Liabilities 1,446,096 1,479,691 Stockholders’ Equity – Preferred Stock, Par Value $ 0.01 ; Authorized 5,000,000 Shares; None Issued — — Common Stock, Par Value $ 0.01 ; Authorized 100,000,000 Shares; Issued and Outstanding 38,710,929 and 42,370,878 Shares, respectively 387 424 Capital in Excess of Par Value — 62,497 Accumulated Other Comprehensive Losses ( 3,175 ) ( 3,440 ) Retained Earnings 1,136,344 1,299,509 Total Stockholders’ Equity 1,133,556 1,358,990 $ 2,579,652 $ 2,838,681 See Notes to Consolidated Financial Statements. 60 Eagle Materials Inc. and Subsidiaries C onsolidated Statements of Cash Flows For the Years Ended March 31, 2022 2021 2020 (dollars in thousands) CASH FLOWS FROM OPERATING ACTIVITIES Net Earnings $ 374,247 $ 339,444 $ 70,894 Adjustments to Reconcile Net Earnings to Net Cash Provided by Operating Activities, Net of Effect of Non-Cash Activity: Depreciation, Depletion, and Amortization 128,811 129,087 113,518 Write-off of Debt Issuance Costs 6,101 — — Impairment Losses — — 224,267 Deferred Income Tax Provision 6,383 59,319 75,987 Stock Compensation Expense 14,264 15,293 19,823 Gain on Sale of Businesses — ( 61,203 ) — Equity in Earnings of Unconsolidated Joint Venture ( 32,488 ) ( 37,441 ) ( 42,585 ) Distributions from Joint Venture 27,250 36,000 33,500 Changes in Operating Assets and Liabilities: Accounts and Notes Receivable ( 29,209 ) 2,127 ( 25,005 ) Inventories ( 912 ) 30,002 26,729 Accounts Payable and Accrued Liabilities 27,192 9,541 17,265 Other Assets ( 1,331 ) ( 6,455 ) 7,841 Income Taxes Receivable ( 3,137 ) 127,359 ( 122,933 ) Net Cash Provided by Operating Activities 517,171 643,073 399,301 CASH FLOWS FROM INVESTING ACTIVITIES Additions to Property, Plant, and Equipment ( 74,121 ) ( 53,933 ) ( 132,119 ) Acquisition Spending — — ( 699,361 ) Proceeds from Sale of Businesses — 91,022 — Proceeds from Sales of Property, Plant, and Equipment — — 400 Net Cash Provided by (Used in) Investing Activities ( 74,121 ) 37,089 ( 831,080 ) CASH FLOWS FROM FINANCING ACTIVITIES (Decrease) Increase in Revolving Credit Facility 200,000 ( 560,000 ) 250,000 Proceeds from 2.500% Senior Unsecured Notes 743,692 — — Repayment of 4.500% Senior Unsecured Notes ( 350,000 ) — — Issuance (Repayment) of Term Loan ( 665,000 ) — 665,000 Repayment of Private Placement Senior Unsecured Notes — — ( 36,500 ) Dividends Paid to Stockholders ( 30,770 ) ( 4,163 ) ( 17,142 ) Purchase and Retirement of Common Stock ( 589,742 ) — ( 313,887 ) Proceeds from Stock Option Exercises 21,366 40,455 3,298 Premium Paid on Early Retirement of Senior Notes ( 8,407 ) — — Payment of Debt Issuance Costs ( 7,985 ) ( 2,396 ) ( 4,880 ) Shares Redeemed to Settle Employee Taxes on Stock Compensation ( 5,308 ) ( 4,186 ) ( 4,063 ) Net Cash (Used in) Provided by Financing Activities ( 692,154 ) ( 530,290 ) 541,826 NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH ( 249,104 ) 149,872 110,047 CASH, CASH EQUIVALENTS, AND RESTRICTED CASH AT BEGINNING OF PERIOD 268,520 118,648 8,601 CASH, CASH EQUIVALENTS, AND RESTRICTED CASH AT END OF PERIOD $ 19,416 $ 268,520 $ 118,648 See Notes to Consolidated Financial Statements. 61 Eagle Materials Inc. and Subsidiaries C onsolidated Statements of Stockholders’ Equity Common Stock Capital in Excess of Par Value Retained Earnings Accumulated Other Comprehensive Losses Total (dollars in thousands) Balance at March 31, 2019 $ 451 $ — $ 1,212,352 $ ( 3,316 ) $ 1,209,487 Net Earnings — — 70,894 — 70,894 Stock Option Exercises and Restricted Share Vesting 1 3,298 — — 3,299 Purchase and Retirement of Common Stock ( 36 ) ( 8,114 ) ( 305,737 ) — ( 313,887 ) Dividends to Stockholders — — ( 16,808 ) — ( 16,808 ) Stock Compensation Expense — 19,822 — — 19,822 Shares Redeemed to Settle Employee Taxes — ( 4,063 ) — — ( 4,063 ) Cumulative Effect of Change in Accounting For Leases — — ( 636 ) — ( 636 ) Unfunded Pension Liability, net of tax — — — ( 265 ) ( 265 ) Balance at March 31, 2020 $ 416 $ 10,943 $ 960,065 $ ( 3,581 ) $ 967,843 Net Earnings — — 339,444 — 339,444 Stock Option Exercises and Restricted Share Vesting 8 40,449 — — 40,457 Stock Compensation Expense — 15,291 — — 15,291 Shares Redeemed to Settle Employee Taxes — ( 4,186 ) — — ( 4,186 ) Sale of Business with Unfunded Pension Liability — — — 254 254 Unfunded Pension Liability, net of tax — — — ( 113 ) ( 113 ) Balance at March 31, 2021 $ 424 $ 62,497 $ 1,299,509 $ ( 3,440 ) $ 1,358,990 Net Earnings — — 374,247 — 374,247 Stock Option Exercises and Restricted Share Vesting 3 21,363 — — 21,366 Stock Compensation Expense — 14,264 — — 14,264 Shares Redeemed to Settle Employee Taxes — ( 5,308 ) — — ( 5,308 ) Purchase and Retirement of Common Stock ( 40 ) ( 92,816 ) ( 496,886 ) — ( 589,742 ) Dividends to Stockholders — — ( 40,526 ) — ( 40,526 ) Unfunded Pension Liability, net of tax — — — 265 265 Balance at March 31, 2022 $ 387 $ — $ 1,136,344 $ ( 3,175 ) $ 1,133,556 See Notes to Consolidated Financial Statements. 62 Eagle Materials Inc. and Subsidiaries N ot es to Consolidated Financial Statements (A) Significant Accounting Policies Basis of Presentation The consolidated financial statements include the accounts of Eagle Materials Inc. and its majority-owned subsidiaries (the Company), which may be referred to as we, our, or us.
Biggest changeFinancial Statements and Supplementary Data Financial Information Index to Financial Statements and Related Information PAGE Eagle Materials Inc.: Consolidated Statements of Earnings for the Years Ended March 31, 2023, 2022, and 20 21 62 Consolidated Statements of Comprehensive Earnings for the Years Ended March 31, 2023, 2022, and 2021 63 Consolidated Balance Sheets as of March 31, 2023 and 2022 64 Consolidated Statements of Cash Flows for the Years Ended March 31, 2023, 2022, and 2021 65 Consolidated Statements of Stockholders’ Equity for the Years Ended March 31, 2023, 2022, and 20 21 66 Notes to Consolidated Financial Statements 67 Report of Independent Registered Public Accounting Firm 96 Auditor Name: Ernst & Young LLP Auditor Location: Dallas, Texas Auditor Firm ID: 42 61 Eagle Materials Inc. and Subsidiaries C onsolidated Statements of Earnings For the Years Ended March 31, 2023 2022 2021 (dollars in thousands, except share and per share data) Revenue $ 2,148,069 $ 1,861,522 $ 1,622,642 Cost of Goods Sold 1,508,803 1,341,908 1,214,287 Gross Profit 639,266 519,614 408,355 Equity in Earnings of Unconsolidated Joint Venture 35,474 32,488 37,441 Corporate General and Administrative Expense ( 53,630 ) ( 46,801 ) ( 49,511 ) Loss on Early Retirement of Senior Notes — ( 8,407 ) — Gain on Sale of Businesses — — 51,973 Other Nonoperating Income 2,654 9,073 20,274 Interest Expense, net ( 35,171 ) ( 30,873 ) ( 44,420 ) Earnings from Continuing Operations Before Income Taxes 588,593 475,094 424,112 Income Taxes ( 127,053 ) ( 100,847 ) ( 89,946 ) Earnings from Continuing Operations 461,540 374,247 334,166 Earnings from Discontinued Operations, net of Income Taxes — — 5,278 Net Earnings $ 461,540 $ 374,247 $ 339,444 BASIC EARNINGS PER SHARE Continuing Operations $ 12.54 $ 9.23 $ 8.04 Discontinued Operations — — 0.13 Net Earnings $ 12.54 $ 9.23 $ 8.17 DILUTED EARNINGS PER SHARE Continuing Operations $ 12.46 $ 9.14 $ 7.99 Discontinued Operations — — 0.13 Net Earnings $ 12.46 $ 9.14 $ 8.12 AVERAGE SHARES OUTSTANDING Basic 36,798,354 40,547,048 41,543,067 Diluted 37,052,942 40,929,712 41,826,709 CASH DIVIDENDS PER SHARE $ 1.00 $ 0.75 $ 0.10 See Notes to Consolidated Financial Statements. 62 Eagle Materials Inc. and Subsidiaries C onsolidated Statements of Comprehensive Earnings For the Years Ended March 31, 2023 2022 2021 (dollars in thousands) Net Earnings $ 461,540 $ 374,247 $ 339,444 Net Actuarial Change in Defined Benefit Plans: Unrealized (Loss) Gain During the Period, net of tax (benefit) expense of $( 147 ), $ 48 , and $ 33 ( 465 ) 161 101 Amortization of Net Actuarial Gain (Loss), net of tax (expense) benefit of $ 30 , $ 39 , and $( 49 ) 93 104 ( 154 ) Comprehensive Earnings $ 461,168 $ 374,512 $ 339,391 See Notes to Consolidated Financial Statements. 63 Eagle Materials Inc. and Subsidiaries C onsolidated Balance Sheets March 31, 2023 2022 (dollars in thousands) ASSETS Current Assets Cash and Cash Equivalents $ 15,242 $ 19,416 Accounts and Notes Receivable, net 195,052 176,276 Inventories 291,882 236,661 Income Tax Receivable 16,267 7,202 Prepaid and Other Assets 3,060 3,172 Total Current Assets 521,503 442,727 Property, Plant, and Equipment, net 1,662,061 1,616,539 Notes Receivable 7,382 8,485 Investment in Joint Venture 89,111 80,637 Operating Lease Right-of-Use Assets 20,759 23,856 Goodwill and Intangible Assets, net 466,043 387,898 Other Assets 14,143 19,510 Total Assets $ 2,781,002 $ 2,579,652 LIABILITIES AND STOCKHOLDERS’ EQUITY Current Liabilities Accounts Payable $ 110,408 $ 113,679 Accrued Liabilities 86,472 86,754 Operating Lease Liabilities 6,009 7,118 Current Portion of Long-term Debt 10,000 — Total Current Liabilities 212,889 207,551 Long-term Debt 1,079,032 938,265 Noncurrent Operating Lease Liabilities 24,940 29,212 Other Long-term Liabilities 41,603 38,699 Deferred Income Taxes 236,844 232,369 Total Liabilities 1,595,308 1,446,096 Stockholders’ Equity Preferred Stock, Par Value $ 0.01 ; Authorized 5,000,000 Shares; None Issued — — Common Stock, Par Value $ 0.01 ; Authorized 100,000,000 Shares; Issued and Outstanding 35,768,376 and 38,710,929 Shares, respectively 358 387 Capital in Excess of Par Value — — Accumulated Other Comprehensive Losses ( 3,547 ) ( 3,175 ) Retained Earnings 1,188,883 1,136,344 Total Stockholders’ Equity 1,185,694 1,133,556 $ 2,781,002 $ 2,579,652 See Notes to Consolidated Financial Statements. 64 Eagle Materials Inc. and Subsidiaries C onsolidated Statements of Cash Flows For the Years Ended March 31, 2023 2022 2021 (dollars in thousands) CASH FLOWS FROM OPERATING ACTIVITIES Net Earnings $ 461,540 $ 374,247 $ 339,444 Adjustments to Reconcile Net Earnings to Net Cash Provided by Operating Activities, Net of Effect of Noncash Activity: Depreciation, Depletion, and Amortization 138,554 128,811 129,087 Write-off of Debt Issuance Costs — 6,101 — Deferred Income Tax Provision 4,475 6,383 59,319 Stock Compensation Expense 17,155 14,264 15,293 Gain on Sale of Businesses — — ( 61,203 ) Equity in Earnings of Unconsolidated Joint Venture ( 35,474 ) ( 32,488 ) ( 37,441 ) Distributions from Joint Venture 27,000 27,250 36,000 Changes in Operating Assets and Liabilities: Accounts and Notes Receivable ( 12,035 ) ( 29,209 ) 2,127 Inventories ( 47,946 ) ( 912 ) 30,002 Accounts Payable and Accrued Liabilities ( 7,797 ) 27,192 9,541 Other Assets 4,955 ( 1,331 ) ( 6,455 ) Income Taxes Receivable ( 8,701 ) ( 3,137 ) 127,359 Net Cash Provided by Operating Activities 541,726 517,171 643,073 CASH FLOWS FROM INVESTING ACTIVITIES Additions to Property, Plant, and Equipment ( 110,143 ) ( 74,121 ) ( 53,933 ) Acquisition Spending ( 158,451 ) — — Proceeds from Sale of Businesses — — 91,022 Net Cash Provided by (Used in) Investing Activities ( 268,594 ) ( 74,121 ) 37,089 CASH FLOWS FROM FINANCING ACTIVITIES Borrowings Under Revolving Credit Facility 200,000 200,000 — Repayment of Borrowings Under Revolving Credit Facility ( 43,000 ) — ( 560,000 ) Proceeds from 2.500% Senior Unsecured Notes — 743,692 — Repayment of 4.500% Senior Unsecured Notes — ( 350,000 ) — Repayment of Term Loan ( 7,500 ) ( 665,000 ) — Dividends Paid to Stockholders ( 37,496 ) ( 30,770 ) ( 4,163 ) Purchase and Retirement of Common Stock ( 387,717 ) ( 589,742 ) — Proceeds from Stock Option Exercises 5,418 21,366 40,455 Premium Paid on Early Retirement of Senior Notes — ( 8,407 ) — Payment of Debt Issuance Costs ( 903 ) ( 7,985 ) ( 2,396 ) Shares Redeemed to Settle Employee Taxes on Stock Compensation ( 6,108 ) ( 5,308 ) ( 4,186 ) Net Cash Used in Financing Activities ( 277,306 ) ( 692,154 ) ( 530,290 ) NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS ( 4,174 ) ( 249,104 ) 149,872 CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 19,416 268,520 118,648 CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 15,242 $ 19,416 $ 268,520 See Notes to Consolidated Financial Statements. 65 Eagle Materials Inc. and Subsidiaries C onsolidated Statements of Stockholders’ Equity Common Stock Capital in Excess of Par Value Retained Earnings Accumulated Other Comprehensive Losses Total (dollars in thousands) Balance at March 31, 2020 $ 416 $ 10,943 $ 960,065 $ ( 3,581 ) $ 967,843 Net Earnings — — 339,444 — 339,444 Stock Option Exercises and Restricted Share Vesting 8 40,449 — — 40,457 Stock Compensation Expense — 15,291 — — 15,291 Shares Redeemed to Settle Employee Taxes — ( 4,186 ) — — ( 4,186 ) Sale of Business with Unfunded Pension Liability — — — 254 254 Unfunded Pension Liability, net of tax — — — ( 113 ) ( 113 ) Balance at March 31, 2021 $ 424 $ 62,497 $ 1,299,509 $ ( 3,440 ) $ 1,358,990 Net Earnings — — 374,247 — 374,247 Stock Option Exercises and Restricted Share Vesting 3 21,363 — — 21,366 Stock Compensation Expense — 14,264 — — 14,264 Shares Redeemed to Settle Employee Taxes — ( 5,308 ) — — ( 5,308 ) Purchase and Retirement of Common Stock ( 40 ) ( 92,816 ) ( 496,886 ) — ( 589,742 ) Dividends to Stockholders — — ( 40,526 ) — ( 40,526 ) Unfunded Pension Liability, net of tax — — — 265 265 Balance at March 31, 2022 $ 387 $ — $ 1,136,344 $ ( 3,175 ) $ 1,133,556 Net Earnings — — 461,540 — 461,540 Stock Option Exercises and Restricted Share Vesting 2 5,416 — — 5,418 Stock Compensation Expense — 17,155 — — 17,155 Shares Redeemed to Settle Employee Taxes — ( 6,108 ) — — ( 6,108 ) Purchase and Retirement of Common Stock ( 31 ) ( 16,463 ) ( 371,961 ) — ( 388,455 ) Dividends to Stockholders — — ( 37,040 ) — ( 37,040 ) Unfunded Pension Liability, net of tax — — — ( 372 ) ( 372 ) Balance at March 31, 2023 $ 358 $ — $ 1,188,883 $ ( 3,547 ) $ 1,185,694 See Notes to Consolidated Financial Statements. 66 Eagle Materials Inc. and Subsidiaries N ot es to Consolidated Financial Statements (A) Significant Accounting Policies Basis of Presentation The consolidated financial statements include the accounts of Eagle Materials Inc. and its majority-owned subsidiaries (the Company), which may be referred to as we, our, or us.
If, as a result of this qualitative analysis, we conclude that it is more likely than not (a likelihood of greater than 50 %) that the fair value of the reporting unit exceeds its carrying value, then an impairment does not exist and the quantitative Step 1 test is not required.
If, as a result of this qualitative analysis, we conclude that it is more likely than not (a likelihood of greater than 50 %) that the fair value of the reporting unit exceeds its carrying value, then an impairment does not exist and the Step 1 quantitative test is not required.
If we are unable to conclude that it is more likely than not that the fair value of the reporting unit exceeds its carrying value, then we proceed to the quantitative Step 1 test. Step 1 of the quantitative test for impairment compares the fair value of the reporting unit to its carrying value.
If we are unable to conclude that it is more likely than not that the fair value of the reporting unit exceeds its carrying value, then we proceed to the Step 1 quantitative test. Step 1 of the quantitative test for impairment compares the fair value of the reporting unit to its carrying value.
The 2.500% Senior Unsecured Notes are senior unsecured obligations of the Company and are not guaranteed by any of our subsidiaries. The 2.500% Senior Unsecured Notes were issued net of original issue discount of $ 6.3 million and have an effective interest rate of approximately 2.6 %.
The 2.500% Senior Unsecured Notes are senior unsecured obligations of the Company and are not guaranteed by any of our subsidiaries. The 2.500% Senior Unsecured Notes were issued net of the original issue discount of $ 6.3 million and have an effective interest rate of approximately 2.6 %.
The tax matters challenged by the tax authorities are typically complex; therefore, the ultimate outcome of these challenges is subject to uncertainty. We review and assess all tax positions subject to uncertainty on a more-likely-than-not standard with respect to ultimate outcome if challenged. We measure and record tax benefit or expense only when the more-likely-than-not threshold is met.
The tax matters challenged by the tax authorities are typically complex; therefore, the ultimate outcome of these challenges is subject to uncertainty. We review and assess all tax positions subject to uncertainty on a more-likely-than-not standard with respect to the ultimate outcome if challenged. We measure and record tax benefit or expense only when the more-likely-than-not threshold is met.
The Company pays each lender a participation fee with respect to such lender’s participations in letters of credit, which fee accrues at the same Applicable Rate (as defined in the Revolving Credit Facility) used to determine the interest rate applicable to Eurodollar Revolving Loans (as defined in the Revolving Credit Facility) plus a fronting fee for each letter of credit issued by the issuing bank in an amount equal to 12.5 basis points per annum on the daily maximum amount then available to be drawn under such letter of credit.
The Company pays each lender a participation fee with respect to such lender’s participation in letters of credit, which fee accrues at the same Applicable Rate (as defined in the Revolving Credit Facility) used to determine the interest rate applicable to Eurodollar Revolving Loans (as defined in the Revolving Credit Facility) plus a fronting fee for each letter of credit issued by the issuing bank in an amount equal to 12.5 basis points per annum on the daily maximum amount then available to be drawn under such letter of credit.
To test the existence of raw materials and materials-in-progress inventory, we performed audit procedures, assisted by specialists, that included, among others, obtaining inventory measurements performed by third parties, observing management’s inspection and measurement of inventory, testing the measurement techniques of the inventory stockpiles, testing the underlying calculations of the measurements in the conversion calculations utilizing density factors, and evaluating the appropriateness of the density factors utilized in the calculations as compared to industry information. /s/ Ernst & Young LLP We have served as the Company’s auditor since 2002.
To test the existence of certain raw materials and materials-in-progress inventory, we performed audit procedures, assisted by specialists, that included, among others, obtaining inventory measurements performed by third parties, observing management’s inspection and measurement of inventory, testing the measurement techniques of the inventory stockpiles, testing the underlying calculations of the measurements in the conversion calculations utilizing density factors, and evaluating the appropriateness of the density factors utilized in the calculations as compared to industry information. /s/ Ernst & Young LLP We have served as the Company’s auditor since 2002.
The range of target asset allocations has been determined given the current funded status of the plan. Each asset class is actively managed by one or more external money managers with the objective of 89 generating returns, net of management fees, that exceed market-based benchmarks. None of the plans hold any Company stock.
The range of target asset allocations has been determined given the current funded status of the plan. Each asset class is actively managed by one or more external money managers with the objective of generating returns, net of management fees, that exceed market-based benchmarks. None of the plans hold any Company stock.
For segment reporting purposes only, we proportionately consolidate our 50 % share of the Joint Venture Revenue and Operating Earnings, consistent with the way management reports the segments within the Company for making operating decisions and assessing performance. The following tables below set forth certain financial information relating to our operations by segment.
For segment reporting purposes only, we proportionately consolidate our 50 % share of the Joint Venture Revenue and Operating Earnings, consistent with the way management reports the segments within the Company for making operating decisions and assessing performance. The following tables set forth certain financial information relating to our operations by segment.
A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. 113 Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.
A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. 99 Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.
Stock Repurchases Shares repurchased by the Company are considered retired and available for future issuance. When shares are repurchased, the Company first reduces Capital in Excess or Par Value, and if there is no balance in this account, the purchases are recorded as a reduction of Retained Earnings.
Stock Repurchases Shares repurchased by the Company are considered retired and available for future issuance. When shares are repurchased, the Company first reduces Capital in Excess of Par Value, and if there is no balance in this account, the purchases are recorded as a reduction of Retained Earnings.
The profit sharing plans are defined contribution plans funded by employer discretionary contributions; employees may also contribute a certain percentage of their base annual salary. Employees are fully vested in their own contributions and become fully vested in any Company contributions over a four-year 90 period.
The profit sharing plans are defined contribution plans funded by employer discretionary contributions; employees may also contribute a certain percentage of their base annual salary. Employees are fully vested in their own contributions and become fully vested in any Company contributions over a four-year period.
Corporate General and Administrative (Corporate G&A) 68 Expenses include administration, financial, legal, employee benefits, and other corporate activities, and are shown separately in the Consolidated Statements of Earnings. Corporate G&A also includes stock compensation expense. See Footnote (L) for more information.
Corporate General and Administrative (Corporate G&A) Expenses include administration, financial, legal, employee benefits, and other corporate activities, and are shown separately in the Consolidated Statements of Earnings. Corporate G&A also includes stock compensation expense. See Footnote (L) for more information.
These funds are maintained by an investment manager and are primarily invested in indexes. The remaining funds, excluding cash, primarily consist of investments in institutional funds. Profit Sharing Plans We also provide profit sharing plans, which cover substantially all salaried and certain hourly employees.
These funds are maintained by an investment manager and are primarily invested in indexes. The remaining funds, excluding cash, primarily consist of investments in institutional funds. 94 Profit Sharing Plans We also provide profit sharing plans, which cover substantially all salaried and certain hourly employees.
When we arrange for a third party to deliver products to customers, fees for shipping and handling billed to the customer are recorded as Revenue, while costs incurred for shipping and handling are recorded as expenses and included in Cost of Goods Sold.
When we arrange for a third party to deliver products to customers, fees for shipping and handling billed to the customer are 71 recorded as Revenue, while costs incurred for shipping and handling are recorded as expenses and included in Cost of Goods Sold.
The shares were valued at March 31, 2022 and 2021 using Level 1 inputs at the quoted market price of the shares, and the shares are classified as Other Assets in our Consolidated Balance Sheet at March 31, 2022 and 2021.
The shares were valued at March 31, 2023, 2022, and 2021 using Level 1 inputs at the quoted market price of the shares, and the shares are classified as Other Assets in our Consolidated Balance Sheet at March 31, 2023 and 2022.
How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company’s process of determining the existence of raw materials and materials-in-progress inventory.
How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company’s process of determining the existence of certain raw materials and materials-in-progress inventory.
Auditing management’s process for measuring raw materials and materials-in-progress inventory was complex as auditor judgement was necessary to evaluate the Company’s process for measuring the inventory, given the technology utilized, and converting the measurements to tonnage.
Auditing management’s process for measuring certain raw materials and materials-in-progress inventory was complex as auditor judgement was necessary to evaluate the Company’s process for measuring the inventory, given the technology utilized, and converting the measurements to tonnage.
We believe that our audits provide a reasonable basis for our opinion. 93 Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments.
We believe that our audits provide a reasonable basis for our opinion. 96 Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments.
We do not presently utilize derivative financial instruments. We are subject to commodity risk with respect to price changes principally in coal, petroleum coke, natural gas, and power. We attempt to limit our exposure to changes in commodity prices by entering into contracts or increasing use of alternative fuels. 56 I TEM 8.
We do not presently utilize derivative financial instruments. We are subject to commodity risk with respect to price changes principally in coal, petroleum coke, natural gas, and power. We attempt to limit our exposure to changes in commodity prices by entering into contracts or increasing use of alternative fuels. 60 I TEM 8.
The change in unrecognized tax benefits for the years ended March 31, 2022, 2021, and 2020 was as follows: For the Years Ended March 31, 2022 2021 2020 (dollars in thousands) Balance at Beginning of Year $ 1,284 $ 4,200 $ — Increase Related to Current Tax Positions — 1,284 4,200 Decrease Related to Current Tax Positions — ( 4,200 ) — Payments — — — $ 1,284 $ 1,284 $ 4,200 We recorded a $ 4.2 million reserve resulting from of a position we took on our fiscal 2020 federal tax return, which is related to the interest limitation under IRC Section 163(j) and the resulting carryback allowed under the CARES Act.
The change in unrecognized tax benefits for the years ended March 31, 2023, 2022, and 2021 was as follows: For the Years Ended March 31, 2023 2022 2021 (dollars in thousands) Balance at Beginning of Year $ 1,284 $ 1,284 $ 4,200 Increase Related to Current Tax Positions — — 1,284 Decrease Related to Current Tax Positions — — ( 4,200 ) Payments — — — $ 1,284 $ 1,284 $ 1,284 We recorded a $ 4.2 million reserve resulting from of a position taken on our fiscal 2020 federal tax return, which is related to the interest limitation under IRC Section 163(j) and the resulting carryback allowed under the CARES Act.
Long-lived assets, or group of assets, are evaluated for impairment at the lowest level for which cash flows are largely independent of the cash flows of other assts.
Long-lived assets, or group of assets, are evaluated for impairment at the lowest level for which cash flows are largely independent of the cash flows of other assets.
In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at March 31, 2022 and 2021, and the results of its operations and its cash flows for each of the three years in the period ended March 31, 2022, in conformity with U.S. generally accepted accounting principles.
In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at March 31, 2023 and 2022, and the results of its operations and its cash flows for each of the three years in the period ended March 31, 2023, in conformity with U.S. generally accepted accounting principles.
Other Non-Operating Income includes lease and rental income, asset sale income, non-inventoried aggregates sales income, and trucking income, as well as other miscellaneous revenue items and costs that have not been allocated to a business segment. See Footnote (I) for disaggregation of Revenue by segment.
Other Nonoperating Income includes lease and rental income, asset sale income, non-inventoried aggregates sales income, and trucking income, as well as other miscellaneous revenue items and costs that have not been allocated to a business segment. See Footnote (I) for disaggregation of Revenue by segment.
The collective bargaining agreements for the employees who participate in the multi-employer plans expire in February 2024 and March 2025 . Our expense related to these plans was approximately $ 1.7 million, $ 1.8 million, and $ 1.7 million during fiscal years 2022, 2021, and 2020, respectively.
The collective bargaining agreements for the employees who participate in the multi-employer plans expire in February 2024 and March 2025 . Our expense related to these plans was approximately $ 1.8 million , $ 1.7 million, and $ 1.8 million during fiscal years 2023, 2022, and 2021, respectively.
We performed a quantitative Step 1 impairment test on our all of our reporting units with Goodwill during the fourth quarter of fiscal 2021. We estimated the reporting unit’s fair value using a discounted cash flow model as well as a market analysis.
We performed a Step 1 quantitative impairment test on our all of our reporting units with Goodwill during the fourth quarter of fiscal 2021. We estimated the fair value of the reporting unit using a discounted cash flow model as well as a market analysis.
The performance criterion for the Fiscal 2022 Employee Performance Stock Option Grant was based upon the achievement of certain levels of return on equity (as defined in the option agreements), ranging from 10.0 % to 20.0 %, for the fiscal year ending March 31, 2022.
The performance criterion for the Fiscal 2023 Employee Performance Stock Option Grant was based upon the achievement of certain levels of return on equity (as defined in the option agreements), ranging from 10.0 % to 20.0 %, for the fiscal year ending March 31, 2023.
The performance criterion for the Fiscal 2022 Employee Restricted Stock Performance Award is based upon the achievement of certain levels of return on equity (as defined in the agreement), ranging from 10.0 % to 20.0 %, for the fiscal year ended March 31, 2022.
The performance criterion for the Fiscal 2023 Employee Restricted Stock Performance Award is based upon the achievement of certain levels of return on equity (as defined in the agreement), ranging from 10.0 % to 20.0 %, for the fiscal year ended March 31, 2023.
Any assets held for sale are reflected at the lower of their carrying amount or fair value less cost to sell. There were no indicators of impairment related to our long-lived assets during fiscal 2022.
Any assets held for sale are reflected at the lower of their carrying amount or fair value less cost to sell. There were no indicators of impairment related to our long-lived assets during fiscal 2023.
The allowance for non-collection of receivables is based on our assessment of the collectability of outstanding accounts receivable, and includes a provision for probable losses based on historical write-offs, adjusted for current economic trends in the construction industry, and a specific reserve for accounts deemed at risk. We have no significant credit risk concentration among our diversified customer base.
The allowance for noncollection of receivables is based on our assessment of the collectability of outstanding accounts receivable, and includes a provision for probable losses based on historical write-offs, adjusted for current economic trends in the construction industry, and a specific reserve for accounts deemed at risk. We have no significant credit risk concentration among our diversified customer base.
The effectiveness of our internal control over financial reporting as of March 31, 2022, has been audited by Ernst & Young LLP, an independent registered public accounting firm, as stated in their report which is included herein. 112 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Stockholders and the Board of Directors of Eagle Materials Inc. and Subsidiaries Opinion on Internal Control Over Financial Reporting We have audited Eagle Materials Inc. and Subsidiaries’ internal control over financial reporting as of March 31, 2022, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), (the COSO criteria).
The effectiveness of our internal control over financial reporting as of March 31, 2023, has been audited by Ernst & Young LLP, an independent registered public accounting firm, as stated in their report which is included herein. 98 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Stockholders and the Board of Directors of Eagle Materials Inc. and Subsidiaries Opinion on Internal Control Over Financial Reporting We have audited Eagle Materials Inc. and Subsidiaries’ internal control over financial reporting as of March 31, 2023, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).
Both of the Fiscal 2022 Employee Restricted Stock Performance Award and the Fiscal 2022 Employee Restricted Stock Time-Vesting Award were valued at the closing price of the stock on the date of grant and are being expensed over a four-year period.
Both of the Fiscal 2023 Employee Restricted Stock Performance Award and the Fiscal 2023 Employee Restricted Stock Time-Vesting Award were valued at the closing price of the stock on the date of grant and are being expensed over a four-year period.
In our opinion, Eagle Materials Inc. and Subsidiaries (the Company) maintained, in all material respects, effective internal control over financial reporting as of March 31, 2022, based on the COSO criteria.
In our opinion, Eagle Materials Inc. and Subsidiaries (the Company) maintained, in all material respects, effective internal control over financial reporting as of March 31, 2023, based on the COSO criteria.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of March 31, 2022, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated May 20, 2022 expressed an unqualified opinion thereon.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of March 31, 2023, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated May 19, 2023 expressed an unqualified opinion thereon.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of March 31, 2022 and 2021, the related consolidated statements of earnings, comprehensive earnings, stockholders’ equity and cash flows for each of the three years in the period ended March 31, 2022, and the related notes, and our report dated May 20, 2022 expressed an unqualified opinion thereon.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of March 31, 2023 and 2022, the related consolidated statements of earnings, comprehensive earnings, stockholders’ equity and cash flows for each of the three years in the period ended March 31, 2023, and the related notes, and our report dated May 19, 2023 expressed an unqualified opinion thereon.
Additionally, we lease certain equipment under short-term leases with initial terms of less than twelve months. These short-term equipment leases are not recorded on the balance sheet.
Additionally, we lease certain equipment under short-term leases with initial terms of less than 12 months. These short-term equipment leases are not recorded on the balance sheet.
Based on our evaluation under the framework in Internal Control – Integrated Framework , our management concluded that our internal control over financial reporting was effective as of March 31, 2022.
Based on our evaluation under the framework in Internal Control – Integrated Framework , our management concluded that our internal control over financial reporting was effective as of March 31, 2023.
The carrying values of cash and cash equivalents, accounts and notes receivable, accounts payable, and accrued liabilities approximate their fair values at March 31, 2022, due to the short-term maturities of these assets and liabilities. The fair value of our Revolving Credit Facility also approximates its carrying values at March 31, 2022.
The carrying values of cash and cash equivalents, accounts and notes receivable, accounts payable, and accrued liabilities approximate their fair values at March 31, 2023, due to the short-term maturities of these assets and liabilities. The fair value of our Revolving Credit Facility and Term Loan also approximates its carrying values at March 31, 2023.
ITEM 7A. Quantitative and Qualitat ive Disclosures About Market Risk We are exposed to market risks related to fluctuations in interest rates on our Amended Credit Facility. We have occasionally utilized derivative instruments, including interest rate swaps, in conjunction with our overall strategy to manage the debt outstanding that is subject to changes in interest rates.
ITEM 7A. Quantitative and Qualitat ive Disclosures About Market Risk We are exposed to market risks related to fluctuations in interest rates on our Revolving Credit Facility and Term Loan. We have occasionally utilized derivative instruments, including interest rate swaps, in conjunction with our overall strategy to manage the debt outstanding that is subject to changes in interest rates.
The pension plans’ approximate weighted-average asset allocation at March 31, 2022 and 2021, and the range of target allocation are as follows: Percentage of Plan Assets at March 31, Range of Target Allocation 2022 2021 Asset Category - Equity Securities 10 – 20 % 9 % 19 % Debt Securities 60 – 90 % 90 % 79 % Other 0 – 20 % 1 % 2 % Total 100 % 100 % Our pension investment strategies have been developed as part of a comprehensive management process that considers the interaction between the assets and liabilities within each plan.
The pension plans’ approximate weighted-average asset allocation at March 31, 2023 and 2022, and the range of target allocation are as follows: Percentage of Plan Assets at March 31, Range of Target Allocation 2023 2022 Asset Category Equity Securities 10 – 20 % 9 % 9 % Debt Securities 60 – 90 % 89 % 90 % Other 0 – 20 % 2 % 1 % Total 100 % 100 % Our pension investment strategies have been developed as part of a comprehensive management process that considers the interaction between the assets and liabilities within each plan.
Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ Ernst & Young LLP Dallas, Texas May 20, 2022 I TEM 9b. Other Information None.
Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ Ernst & Young LLP Dallas, Texas May 19, 2023 I TEM 9b. Other Information None.
The Revolving Credit Facility also requires the Company to maintain at the end of each fiscal quarter a Leverage Ratio of 3.50 :1.00 or less (subject to certain exceptions) and an Interest Coverage Ratio (both ratios, as defined in the Revolving Credit Facility) equal to or greater than 2.50 to 1.00 (collectively, the Financial Covenants).
The Revolving Credit Facility also requires the Company to maintain at the end of each fiscal quarter a Leverage Ratio of 3.50 :1.00 or less and an Interest Coverage Ratio (both ratios, as 78 defined in the Revolving Credit Facility) equal to or greater than 2.50 to 1.00 (collectively, the Financial Covenants).
We have certain forward purchase contracts, primarily for natural gas, that expire during calendar years 2022 and 2023. The contracts ar e for approximately 30 % of our antici pated natural gas usage. 83 (L) Stock Option Plans On August 7, 2013, our stockholders approved the Eagle Materials Inc.
We have certain forward purchase contracts, primarily for natural gas, that expire during calendar years 2022 and 2023. The contracts ar e for approximately 40 % of our antici pated natural gas usage. 87 (L) Stock Option Plans On August 7, 2013, our stockholders approved the Eagle Materials Inc.
We performed qualitative assessments on all of our reporting units in the fourth quarter of fiscal 2022. As a result of these qualitative assessments, we determined that it was not more likely than not that an impairment existed; therefore, we did not perform a Step 1 quantitative test in fiscal 2022.
We performed qualitative assessments on all of our reporting units in the fourth quarter of fiscal 2023 and 2022. As a result of these qualitative assessments, we determined it was not more likely than not that an impairment existed; therefore, we did not perform a Step 1 quantitative test in either fiscal 2023 or 2022.
The fair value of our Senior Unsecured Notes at March 31, 2022 is as follows: Fair Value (dollars in thousands) 2.500 % Senior Unsecured Notes Due 2031 $ 664,000 The estimated fair value of our long-term debt was based on publicly quoted prices of these debt instruments (level 1 input).
The fair value of our Senior Unsecured Notes at March 31, 2023 is as follows: Fair Value (dollars in thousands) 2.500 % Senior Unsecured Notes Due 2031 $ 610,000 The estimated fair value of our long-term debt was based on publicly quoted prices of these debt instruments (level 1 input).
Comprehensive Income/Losses As of March 31, 2022, we have an Accumulated Other Comprehensive Loss of $ 3.2 million, which is net of income taxes of $ 1.0 million, in connection with recognizing the difference between the fair value of the pension assets and the projected benefit obligation.
Comprehensive Income/Losses As of March 31, 2023, we have an Accumulated Other Comprehensive Loss of $ 3.5 million, which is net of income taxes of $ 1.0 million, in connection with recognizing the difference between the fair value of the pension assets and the projected benefit obligation.
Components of Interest Expense include interest associated with the Revolving Credit Facility, Term Loan (retired in July 2021), Senior Unsecured Notes, Private Placement Senior Unsecured Notes (retired in October 2019), and commitment fees based on the unused portion of the Revolving Credit Facility. Other Expenses include amortization of debt issuance costs and Revolving Credit Facility and Term Loan costs.
Components of Interest Expense include interest associated with the Revolving Credit Facility, Term Loan (retired in July 2021), Senior Unsecured Notes, and commitment fees based on the unused portion of the Revolving Credit Facility. Other Expenses include amortization of debt issuance costs and Revolving Credit Facility and Term Loan costs.
The original issue discount is being amortized by the effective interest method over the ten-year term of the notes.
The original issue discount is being amortized by the effective interest method over the 10-year term of the notes.
Accounts and Notes Receivable Accounts and Notes Receivable have been shown net of the allowance for doubtful accounts of $ 6.7 million and $ 8.1 million at March 31, 2022 and 2021, respectively. We perform ongoing credit evaluations of our customers’ financial condition and generally require no collateral from our customers.
Accounts and Notes Receivable Accounts and Notes Receivable have been shown net of the allowance for doubtful accounts of $ 6.9 million and $ 6.7 million at March 31, 2023 and 2022, respectively. We perform ongoing credit evaluations of our customers’ financial condition and generally require no collateral from our customers.
Major renewals and improvements are capitalized and depreciated. Annual maintenance is expensed as incurred. Depreciation is provided on a straight-line basis over the estimated useful lives of depreciable assets and totaled $ 122.4 million, $ 120.7 million, and $ 109.5 million, for the fiscal years ended March 31, 2022, 2021, and 2020, respectively.
Major renewals and improvements are capitalized and depreciated. Annual maintenance is expensed as incurred. Depreciation is provided on a straight-line basis over the estimated useful lives of depreciable assets and totaled $ 129.6 million, $ 122.4 million, and $ 120.7 million, for the fiscal years ended March 31, 2023, 2022, and 2021, respectively.
The Fiscal 2022 Board of Directors Restricted Stock Awards was valued at the closing price of the stock on the date of the grant and was expensed over a six-month period. The fair value of restricted stock is estimated based on the stock price at the date of the grant.
The Fiscal 2023 Board of Directors Restricted Stock Award was valued at the closing price of the stock on the date of the grant and was expensed over a six-month period. The fair value of restricted stock is estimated based on the stock price at the date of the grant.
The New Term Loan requires quarterly principle payments of $ 2.5 million, with any unpaid amounts due upon maturity on May 5, 2027 .
The Term Loan requires quarterly principal payments of $ 2.5 million, with any unpaid amounts due upon maturity on May 5, 2027 .
Long-Term Compensation Plans Options In May 2021, the Compensation Committee of the Board of Directors approved the granting to certain officers and key employees an aggregate of 4,293 performance-vesting stock options that would be earned only if certain performance conditions were satisfied (the Fiscal 2022 Employee Performance Stock Option Grant).
Long-Term Compensation Plans Options In May 2022, the Compensation Committee of the Board of Directors approved the granting to certain officers and key employees an aggregate of 25,192 performance-vesting stock options that would be earned only if certain performance conditions were satisfied (the Fiscal 2023 Employee Performance Stock Option Grant).
Approximately $ 199.1 million, $ 177.5 million, and $ 168.1 million of freight for the fiscal years ended March 31, 2022, 2021, and 2020, respectively, were included in both Revenue and Cost of Goods Sold in our Consolidated Statement of Earnings.
Approximately $ 229.6 million, $ 199.1 million, and $ 177.5 million of freight for the fiscal years ended March 31, 2023, 2022, and 2021, respectively, were included in both Revenue and Cost of Goods Sold in our Consolidated Statement of Earnings.
The total intrinsic value of options exercised during the fiscal years ended March 31, 2022, 2021, and 2020 was approximately $ 15.7 million, $ 26.4 million and $ 2.2 million, respectively. 85 Restricted Stock In May 2021, the Compensation Committee approved the granting to certain officers and key employees an aggregate of 52,577 shares of performance vesting restricted stock that would be earned only if certain performance conditions were satisfied (the Fiscal 2022 Employee Restricted Stock Performance Award).
The total intrinsic value of options exercised during the fiscal years ended March 31, 2023, 2022, and 2021 was approximately $ 4.4 million, $ 15.7 million and $ 26.4 million, respectively. 89 Restricted Stock In May 2022, the Compensation Committee approved the granting to certain officers and key employees an aggregate of 50,783 shares of performance vesting restricted stock that would be earned only if certain performance conditions were satisfied (the Fiscal 2023 Employee Restricted Stock Performance Award).
The weighted-average assumptions used in the Black-Scholes model to value the option awards in fiscal 2022 and 2021 are as follows: 2022 2021 Dividend Yield 0.8 % 0.0 % Expected Volatility 38.4 % 37.9 % Risk-Free Interest Rate 1.00 % 0.44 % Expected Life 6.0 years 6.0 years 84 Stock option expense for all outstanding stock option awards was approximately $ 3.4 million, $ 4.9 million, and $ 4.5 million for the years ended March 31, 2022, 2021, and 2020, respectively.
The weighted-average assumptions used in the Black-Scholes model to value the option awards in fiscal 2023 and 2022 are as follows: 2023 2022 Dividend Yield 0.8 % 0.8 % Expected Volatility 38.2 % 38.4 % Risk-Free Interest Rate 2.90 % 1.00 % Expected Life 6.0 years 6.0 years 88 Stock option expense for all outstanding stock option awards was approximately $ 3.4 million, 3.4 million, and $ 4.9 million for the years ended March 31, 2023, 2022, and 2021, respectively.
During fiscal 2022, our adjusted return on equity exceeded 20.0 %; therefore, all 4,293 options were earned. The earned stock options will vest ratably over four years , with the first fourth vesting promptly following the determination date, and the remaining options vesting on March 31, 2023 through 2025 .
During fiscal 2023, our adjusted return on equity exceeded 20.0 %; therefore, all of the options were earned. The earned stock options will vest ratably over four years , with the first fourth vesting promptly following the determination date, and the remaining options vesting on March 31, 2024 through 2026 .
During fiscal 2022, the return on equity exceeded 20.0 %; therefore all 52,577 shares were earned. Restrictions on the earned shares will lapse ratably over four years , with the first fourth lapsing promptly following the determination date and the remaining restrictions lapsing on March 31, 2023 through 2025 .
During fiscal 2023, the return on equity exceeded 20.0 %; therefore all of the shares were earned. Restrictions on the earned shares will lapse ratably over four years , with the first fourth lapsing promptly following the determination date and the remaining restrictions lapsing on March 31, 2024 through 2026 .
At March 31, 2022, there were approximately 259,000 shares with remaining restrictions, for which $ 17.2 million of unearned compensation will be recognized over a weighted-average period of 2.4 years. The number of shares available for future grants of stock options, restricted stock units, stock appreciation rights, and restricted stock under the Plan was 3,377,416 at March 31, 2022.
At March 31, 2023, there were approximately 219,000 shares with remaining restrictions, for which $ 17.8 million of unearned compensation will be recognized over a weighted-average period of 2.4 years. The number of shares available for future grants of stock options, restricted stock units, stock appreciation rights, and restricted stock under the Plan was 3,260,302 at March 31, 2023.
At March 31, 2022, we had contingent liabilities under these outstanding letters of credit of approximately $ 5.0 million. We are currently contingently liable for performance under $ 25.9 million in performance bonds required by certain states and municipalities, and their related agencies. The bonds are principally for certain reclamation obligations and mining permits.
At March 31, 2023, we had contingent liabilities under these outstanding letters of credit of approximately $ 6.4 million. We are currently contingently liable for performance under $ 26.9 million in performance bonds required by certain states and municipalities, and their related agencies. The bonds are principally for certain reclamation obligations and mining permits.
We have state income tax credit carryforwards of $ 4.3 million at March 31, 2022, and $ 1.1 million at March 31, 2021, net of Valuation Allowances. The state income tax credits may be carried forward indefinitely. We file income tax returns in U.S. federal and various state jurisdictions.
We have state income tax credit carryforwards of $ 10.7 million at March 31, 2023, compared with $ 4.3 million at March 31, 2022, net of Valuation Allowances. The state income tax credits may be carried forward indefinitely. We file income tax returns in U.S. federal and various state jurisdictions.
At March 31, 2022, there was approximately $ 3.7 million of unrecognized compensation cost related to outstanding stock options, which is expected to be recognized over a weighted-average period of 1.8 years.
At March 31, 2023, there was approximately $ 3.3 million of unrecognized compensation cost related to outstanding stock options, which is expected to be recognized over a weighted-average period of 2.3 years.
There were 6,053 ; 569,431 ; and 475,082 stock options at an average exercise price of $ 139.80 per share, $ 89.11 per share, and $ 95.46 per share, respectively, that were excluded from the computation of diluted earnings per share for the fiscal years ended March 31, 2022, 2021, and 2020, because such inclusion would have been anti-dilutive.
There were 52,375 ; 6,053 ; and 569,431 stock options at an average exercise price of $ 127.06 per share, $ 139.80 per share, and $ 89.11 per share, respectively, that were excluded from the computation of diluted earnings per share for the fiscal years ended March 31, 2023, 2022, and 2021, because such inclusion would have been anti-dilutive.
The Revolving Credit Facility also provides the Company the option to increase the borrowing capacity by up to $ 375.0 million (for a total borrowing capacity of $ 1,125 million), provided that the existing lenders, or new lenders, agree to such increase.
The Revolving Credit Facility includes a separate $ 200.0 million term loan facility (the Term Loan) and also provides the Company the option to increase the borrowing capacity by up to $ 375.0 million (for a total borrowing capacity of $ 1,125.0 million, excluding the Term Loan), provided that the existing lenders, or new lenders, agree to such increase.
Costs relating to the employer discretionary contributions for our plan totaled $ 8.5 million, $ 8.3 million, and $ 8.2 million in fiscal years 2022, 2021, and 2020, respectively.
Costs relating to the employer discretionary contributions for our plan totaled $ 9.1 million, $ 8.5 million, and $ 8.3 million in fiscal years 2023, 2022, and 2021, respectively.
If, based on the weight of available evidence, it is more likely than not that a Deferred Tax Asset will not be realized, we record a Valuation Allowance. 81 We have state net operating loss carryforwards of $ 0.9 million at March 31, 2022, and approximately $ 3.7 million at March 31, 2021, net of valuation allowance.
If, based on the weight of available evidence, it is more likely than not that a Deferred Tax Asset will not be realized, we record a Valuation Allowance. 85 We have state net operating loss carryforwards of $ 2.3 million at March 31, 2023, compared with $ 0.9 million at March 31, 2022, net of Valuation Allowance.
We also made matching contributions to the hourly profit sharing plan for certain of our entities totaling $ 1.3 million, $ 1.1 million, and $ 0.7 million for these employees during fiscal years 2022, 2021, and 2020, respectively. Approximately fifty of our employees belong to three different multi-employer plans.
We also made matching contributions to the hourly profit sharing plan for certain of our entities totaling $ 1.4 million , $ 1.3 million, and $ 1.1 million for these employees during fiscal years 2023, 2022, and 2021, respectively. Approximately 50 of our employees belong to two different multi-employer plans.
The fair values by category of inputs as of March 31, 2022 were as follows: Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Asset Categories (dollars in thousands) Equity Securities $ — $ 3,433 $ — $ 3,433 Fixed Income Securities — 32,583 — 32,583 Real Estate Funds — 115 — 115 Cash Equivalents 182 — — 182 $ 182 $ 36,131 $ — $ 36,313 The fair values by category of inputs as of March 31, 2021 were as follows: Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Asset Categories (dollars in thousands) Equity Securities $ — $ 7,277 $ — $ 7,277 Fixed Income Securities — 30,010 — 30,010 Real Estate Funds — 160 — 160 Cash Equivalents 460 — — 460 $ 460 $ 37,447 $ — $ 37,907 Equity securities consist of funds that are not actively traded.
The fair values by category of inputs as of March 31, 2023 were as follows: Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Asset Categories (dollars in thousands) Equity Securities $ — $ 2,878 $ — $ 2,878 Fixed Income Securities — 27,811 — 27,811 Cash Equivalents 417 — — 417 $ 417 $ 30,689 $ — $ 31,106 The fair values by category of inputs as of March 31, 2022 were as follows: Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Asset Categories (dollars in thousands) Equity Securities $ — $ 3,433 $ — $ 3,433 Fixed Income Securities — 32,583 — 32,583 Real Estate Funds — 115 — 115 Cash Equivalents 182 — — 182 $ 182 $ 36,131 $ — $ 36,313 Equity securities consist of funds that are not actively traded.
Of the available shares, a total of 1,008,690 shares can be used for future restricted stock and restricted stock unit grants. 86 (M) Net Interest Expense The following components are included within Interest Expense, net: For the Years Ended March 31, 2022 2021 2020 (dollars in thousands) Interest Income $ ( 39 ) $ ( 66 ) $ ( 34 ) Interest Expense 21,637 40,624 36,956 Other Expenses 9,275 3,862 1,499 Interest Expense, net $ 30,873 $ 44,420 $ 38,421 Interest Income includes interest earned on investments of excess Cash and Cash Equivalents and Restricted Cash.
Of the available shares, a total of 944,043 shares can be used for future restricted stock and restricted stock unit grants. 90 (M) Net Interest Expense The following components are included within Interest Expense, net: For the Years Ended March 31, 2023 2022 2021 (dollars in thousands) Interest Income $ ( 421 ) $ ( 39 ) $ ( 66 ) Interest Expense 33,706 21,637 40,624 Other Expenses 1,886 9,275 3,862 Interest Expense, net $ 35,171 $ 30,873 $ 44,420 Interest Income includes interest earned on investments of excess Cash and Cash Equivalents.
Certain expenses, which were previously included in the Oil and Gas Proppants operating segment, do not qualify for classification within discontinued operations and have been reclassified from the operating segment to 70 continuing operations. These expenses primarily relate to lease agreements not included in the sale of the Proppants Business.
Certain expenses, which were previously included in the Oil and Gas Proppants operating segment, do not qualify for classification within discontinued operations and have been reclassified from the operating segment to continuing operations.
Actual results could differ from those estimates. Cash and Cash Equivalents Cash Equivalents include short-term, highly liquid investments with original maturities of three months or less and are recorded at cost, which approximates market value. Restricted Cash Restricted Cash is comprised of cash reserved by contractual agreement for a specific use.
Actual results could differ from those estimates. Cash and Cash Equivalents Cash Equivalents include short-term, highly liquid investments with original maturities of three months or less and are recorded at cost, which approximates market value.
In August 2021, we granted to members of the Board of Directors 15,720 shares of restricted stock (the Fiscal 220Board of Directors Restricted Stock Award), which vested six months after the grant date.
In August 2022, we granted to members of the Board of Directors 14,482 shares of restricted stock (the Fiscal 2023 Board of Directors Restricted Stock Award), which vested six months after the grant date.
Consolidated Cash Flows – Supplemental Disclosures Supplemental cash flow information is as follows: For the Years Ended March 31, 2022 2021 2020 (dollars in thousands) Cash Payments: Interest $ 21,298 $ 42,343 $ 37,610 Income Taxes 86,407 32,870 20,046 Operating Cash Flows Used for Operating Leases 8,141 10,741 14,926 Non-Cash Financing Activities: Right-of-use Assets Obtained for Capitalized Operating Lease Liabilities $ 2,598 $ 272 $ 621 Selling, General, and Administrative Expenses Selling, General, and Administrative Expenses of the operating units are included in Cost of Goods Sold on the Consolidated Statements of Earnings.
Consolidated Cash Flows – Supplemental Disclosures Supplemental cash flow information is as follows: For the Years Ended March 31, 2023 2022 2021 (dollars in thousands) Cash Payments: Interest $ 31,596 $ 21,298 $ 42,343 Income Taxes 131,512 86,407 32,870 Operating Cash Flows Used for Operating Leases 8,314 8,141 10,741 Noncash Financing Activities: Right-of-Use Assets Obtained for Capitalized Operating Leases $ 1,711 $ 2,598 $ 272 Excise Tax on Share Repurchases 738 — — Selling, General, and Administrative Expenses Selling, General, and Administrative Expenses of the operating units are included in Cost of Goods Sold on the Consolidated Statements of Earnings.
The majority of Revenue from the sale of cement, concrete, aggregates, and gypsum wallboard is originated by purchase orders from our customers, who are mainly third-party contractors and suppliers. Revenue from our Recycled Paperboard segment is generated primarily through long-term supply agreements that mature between calendar years 2023 and 2025 .
The majority of Revenue from the sale of concrete, aggregates, and gypsum wallboard is originated by purchase orders from our customers, who are mainly third-party contractors and suppliers. Revenue from the sale of cement is sold point-of-sale to customers under sales orders. Revenue from our Recycled Paperboard segment is generated mostly through long-term supply agreements.
Quantities of Raw Materials and Materials-in-Progress, Aggregates and coal inventories, are based on measured volumes, subject to estimation based on the size and location of the inventory piles, and then converted to tonnage using standard inventory density factors.
Raw Materials and Materials-in-Progress include clinker, which is an intermediary product before it is ground into cement powder. Quantities of Raw Materials and Materials-in-Progress, Aggregates and Coal inventories, are based on measured volumes, subject to estimation based on the size and location of the inventory piles, and then converted to tonnage using standard inventory density factors.
Revenue from the sale of cement, concrete, aggregates, and gypsum wallboard that is not related to long-term supply agreements is recognized upon shipment of the related products to customers, which is when title and ownership are transferred, and the customer is obligated to pay. 67 Revenue from sales under our long-term supply agreements is also recognized upon transfer of control to the customer, which generally occurs at the time the product is shipped from the production facility.
Revenue from the sale of cement, concrete, aggregates, and gypsum wallboard that is not related to long-term supply agreements is recognized upon shipment of the related products to customers, which is when title and ownership are transferred, and the customer is obligated to pay.
Based on the results of the Step 1 impairment analysis, we concluded that the fair values of the reporting units substantially exceeded their carrying values, and therefore no impairment was recognized. 65 Goodwill and Intangible Assets Goodwill and Intangible Assets at March 31, 2022 and 2021, consist of the following: March 31, 2022 Amortization Period Cost Additions Accumulated Amortization Net (dollars in thousands) Goodwill and Intangible Assets: Customer Contracts and Relationships 15 years $ 108,610 $ — $ ( 69,866 ) $ 38,744 Permits 25 - 40 years 30,410 — ( 11,629 ) 18,781 Trade Name 15 years 1,500 — ( 264 ) 1,236 Goodwill 329,137 — — 329,137 Total Goodwill and Intangible Assets $ 469,657 $ — $ ( 81,759 ) $ 387,898 March 31, 2021 Amortization Period Cost Additions Accumulated Amortization Net (dollars in thousands) Goodwill and Intangible Assets: Customer Contracts and Relationships 15 years $ 108,610 $ — $ ( 66,445 ) $ 42,165 Permits 25 - 40 years 30,410 — ( 10,759 ) 19,651 Trade Name 15 years 1,500 — ( 138 ) 1,362 Goodwill 329,137 — — 329,137 Total Goodwill and Intangible Assets $ 469,657 $ — $ ( 77,342 ) $ 392,315 Amortization expense of intangibles was $ 4.4 million, $ 4.5 million, and $ 2.5 million for the fiscal years ended March 31, 2022, 2021, and 2020, respectively.
Based on the results of the Step 1 quantitative impairment analysis, we concluded that the fair values of the reporting units substantially exceeded their carrying values, and therefore no impairment was recognized. 69 Goodwill and Intangible Assets Goodwill and Intangible Assets at March 31, 2023 and 2022, consist of the following: March 31, 2023 Amortization Period Cost Additions Accumulated Amortization Net (dollars in thousands) Goodwill and Intangible Assets: Customer Contracts and Relationships 15 years $ 108,610 $ 32,584 $ ( 75,413 ) $ 65,781 Permits 25 - 40 years 30,410 350 ( 12,519 ) 18,241 Trade Name 15 years 1,500 400 ( 590 ) 1,310 Goodwill 329,137 51,574 — 380,711 Total Goodwill and Intangible Assets $ 469,657 $ 84,908 $ ( 88,522 ) $ 466,043 March 31, 2022 Amortization Period Cost Additions Accumulated Amortization Net (dollars in thousands) Goodwill and Intangible Assets: Customer Contracts and Relationships 15 years $ 108,610 $ — $ ( 69,866 ) $ 38,744 Permits 25 - 40 years 30,410 — ( 11,629 ) 18,781 Trade Name 15 years 1,500 — ( 264 ) 1,236 Goodwill 329,137 — — 329,137 Total Goodwill and Intangible Assets $ 469,657 $ — $ ( 81,759 ) $ 387,898 Amortization expense of intangibles was $ 6.8 million, $ 4.4 million, and $ 4.5 million for the fiscal years ended March 31, 2023, 2022, and 2021, respectively.
Due to the nature of raw materials and materials-in-progress inventory, the Company utilizes technology to measure the volume of the inventory stockpiles and applies density factors to convert the measurements to tons of inventory.
Due to the nature of raw materials and materials-in-progress inventory, the Company utilizes technology to measure certain volumes of the inventory stockpiles and applies density factors to convert the measurements to tons of inventory, which is then compared to the Company’s recorded balance.
After the amendment on May 5, 2022, we had $156.0 million outstanding under the Amended Credit Facility and $200.0 million outstanding under the New Term Loan, under which borrowings bear interest at a variable rate. A hypothetical 100 basis point increase in interest rates on these outstanding borrowings would increase our interest expense by $3.6 million on an annual basis.
At March 31, 2023, we had $157.0 million outstanding under the Revolving Credit Facility and $192.5 million outstanding under the Term Loan, under which borrowings bear interest at a variable rate based on SOFR. A hypothetical 100 basis point increase in interest rates on these outstanding borrowings would increase our interest expense by $3.5 million on an annual basis.
The annual measurement date is March 31 for the benefit obligations, fair value of plan assets, and the funded status of the defined benefit plans. 87 The following table provides a reconciliation of the Benefit Obligations and Fair Values of Plan Assets for all defined benefit plans for the years ended March 31, 2022 and 2021, as well as a statement of the funded status for the same periods: For the Years Ended March 31, 2022 2021 (dollars in thousands) Reconciliation of Benefit Obligations Benefit Obligation at April 1, $ 35,844 $ 36,701 Service Cost - Benefits Earned During the Period — — Interest Cost on Projected Benefit Obligation 1,167 1,216 Actuarial (Gain) Loss ( 1,776 ) 1,714 Benefits Paid ( 1,326 ) ( 1,251 ) Sale of Business — ( 2,536 ) Benefit Obligation at March 31, $ 33,909 $ 35,844 Reconciliation of Fair Value of Plan Assets Fair Value of Plan Assets at April 1, $ 37,907 $ 39,009 Actual Return on Plan Assets ( 268 ) 2,939 Benefits Paid ( 1,326 ) ( 1,251 ) Sale of Business — ( 2,790 ) Fair Value of Plan Assets at March 31, 36,313 37,907 Funded Status - Funded Status at March 31, $ 2,404 $ 2,063 Amounts Recognized in the Balance Sheet Consist of Other Assets $ 2,404 $ 2,063 Accumulated Other Comprehensive Losses: Net Actuarial Loss 4,172 4,524 Prior Service Cost — — Accumulated Other Comprehensive Losses $ 4,172 $ 4,524 Tax impact ( 997 ) ( 1,084 ) Accumulated Other Comprehensive Losses, net of tax $ 3,175 $ 3,440 The table below summarizes the Company’s Projected Benefit Obligation, Accumulated Benefit Obligation, and Fair Value of Plan Assets at March 31, 2022 and 2021: March 31, 2022 2021 (dollars in thousands) Projected Benefit Obligation $ 33,909 $ 35,844 Accumulated Benefit Obligation $ 33,909 $ 35,844 Fair Value of Plan Assets $ 36,313 $ 37,907 Net periodic pension cost for the fiscal years ended March 31, 2022, 2021, and 2020, included the following components: For the Years Ended March 31, 2022 2021 2020 (dollars in thousands) Service Cost - Benefits Earned During the Period $ — $ — $ 339 Interest Cost of Projected Benefit Obligation 1,167 1,216 1,351 Expected Return on Plan Assets ( 1,299 ) ( 1,419 ) ( 1,702 ) Recognized Net Actuarial Loss 143 133 153 Amortization of Prior-Service Cost — — 19 Net Periodic Pension Cost $ 11 $ ( 70 ) $ 160 Expected benefit payments over the next five years, and the following five years under the pension plans are expected to be as follows (dollars in thousands): 88 Fiscal Years Total 2023 $ 1,688 2024 $ 1,702 2025 $ 1,810 2026 $ 1,868 2027 $ 1,941 2028-2032 $ 9,776 The following tables set forth the assumptions used in the actuarial calculations of the present value of Net Periodic Benefit Costs and Benefit Obligations: March 31, 2022 2021 2020 Net Periodic Benefit Costs - Discount Rate 3.33 % 3.64 % 4.09 % Expected Return on Plan Assets 3.50 % 4.00 % 4.75 % Rate of Compensation Increase n/a n/a 3.50 % March 31, 2022 2021 Benefit Obligations - Discount Rate 3.75 % 3.33 % Rate of Compensation Increase n/a n/a The expected long-term rate of return on plan assets is an assumption reflecting the anticipated weighted-average rate of earnings on the portfolio over the long term.
The annual measurement date is March 31 for the benefit obligations, fair value of plan assets, and the funded status of the defined benefit plans. 91 The following table provides a reconciliation of the Benefit Obligations and Fair Values of Plan Assets for all defined benefit plans for the years ended March 31, 2023 and 2022, as well as a statement of the funded status for the same periods: For the Years Ended March 31, 2023 2022 (dollars in thousands) Reconciliation of Benefit Obligations Benefit Obligation at April 1, $ 33,909 $ 35,844 Interest Cost on Projected Benefit Obligation 1,240 1,167 Actuarial Gain ( 4,509 ) ( 1,776 ) Benefits Paid ( 1,451 ) ( 1,326 ) Benefit Obligation at March 31, $ 29,189 $ 33,909 Reconciliation of Fair Value of Plan Assets Fair Value of Plan Assets at April 1, $ 36,313 $ 37,907 Actual Return on Plan Assets ( 3,756 ) ( 268 ) Benefits Paid ( 1,451 ) ( 1,326 ) Fair Value of Plan Assets at March 31, 31,106 36,313 Funded Status Funded Status at March 31, $ 1,917 $ 2,404 Amounts Recognized in the Balance Sheet Include: Other Assets $ 1,917 $ 2,404 Accumulated Other Comprehensive Losses: Net Actuarial Loss 4,662 4,172 Accumulated Other Comprehensive Losses $ 4,662 $ 4,172 Tax Impact ( 1,115 ) ( 997 ) Accumulated Other Comprehensive Losses, net of tax $ 3,547 $ 3,175 Net periodic pension cost for the fiscal years ended March 31, 2023, 2022, and 2021, included the following components: For the Years Ended March 31, 2023 2022 2021 (dollars in thousands) Interest Cost of Projected Benefit Obligation 1,240 1,167 1,216 Expected Return on Plan Assets ( 1,366 ) ( 1,299 ) ( 1,419 ) Recognized Net Actuarial Loss 123 143 133 Net Periodic Pension Cost $ ( 3 ) $ 11 $ ( 70 ) Expected benefit payments over the next five years, and the following five years under the pension plans are expected to be as follows (dollars in thousands): Fiscal Years Total 2024 $ 1,753 2025 $ 1,842 2026 $ 1,890 2027 $ 1,964 2028 $ 1,994 2029-2033 $ 9,834 The following tables set forth the assumptions used in the actuarial calculations of the present value of Net Periodic Benefit Costs and Benefit Obligations: 92 March 31, 2023 2022 2021 Net Periodic Benefit Costs Discount Rate 3.75 % 3.33 % 3.64 % Expected Return on Plan Assets 3.85 % 3.50 % 4.00 % Rate of Compensation Increase n/a n/a n/a March 31, 2023 2022 Benefit Obligations Discount Rate 4.99 % 3.75 % Rate of Compensation Increase n/a n/a The expected long-term rate of return on plan assets is an assumption reflecting the anticipated weighted-average rate of earnings on the portfolio over the long term.
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