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What changed in Atkore Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Atkore Inc.'s 2023 and 2024 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 2024 report.

+214 added−218 removedSource: 10-K (2024-11-21) vs 10-K (2023-11-17)

Top changes in Atkore Inc.'s 2024 10-K

214 paragraphs added · 218 removed · 184 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

42 edited+4 added−8 removed55 unchanged
Biggest changeOur employees are primarily located in the United States, with about 14% employed at our international locations in Australia, Belgium, Canada, China, New Zealand, and the United Kingdom. As of September 30, 2023, approximately 18% of our domestic and international employees were represented by a union under a collective bargaining agreement.
Biggest changeAs of September 30, 2024, approximately 20% of our domestic and international employees were represented by a union under a collective bargaining agreement. All unions are either located in the United States or Canada with no unions or Worker’s Councils at any of our other locations abroad.
The Company continues to implement this ERP as it integrates acquired businesses. In today’s business environment, cybersecurity is of paramount importance and Atkore has also invested significantly to strengthen our cybersecurity posture. 7 Human Capital Resources Culture Atkore believes that a culture of engagement and alignment drives continuous improvement, enhances our customers’ experience, and delivers strong performance.
The Company continues to implement this ERP as it integrates acquired businesses. 7 In today’s business environment, cybersecurity is of paramount importance and Atkore has also invested significantly to strengthen our cybersecurity posture. Human Capital Resources Culture Atkore believes that a culture of engagement and alignment drives continuous improvement, enhances our customers’ experience, and delivers strong performance.
These combined efforts 6 communicate the value proposition of the overall Atkore brand by bringing together complementary solutions in our portfolio while reinforcing the individual value propositions of our leading sub-brands such as Allied Tube & Conduit, AFC Cable Systems, Kaf-Tech, Heritage Plastics, Unistrut, Power-Strut, Cope, US Tray, FRE Composites, United Poly Systems, Calbond and Calpipe.
These combined efforts communicate the value proposition of the overall Atkore brand by bringing together complementary solutions in our portfolio while reinforcing the individual value propositions of our leading sub-brands such as Allied Tube & Conduit, AFC Cable Systems, Kaf-Tech, Heritage Plastics, Unistrut, Power-Strut, Cope, US Tray, FRE Composites, United Poly Systems, Calbond and Calpipe.
Human Rights Atkore is committed to supporting human rights and fair labor practices. We will not tolerate human rights abuses of any kind, including human trafficking, child labor or incidents of corruption within our 9 company or supply chain. Employees are encouraged to report any potential violations or concerns, and all reports are promptly and impartially investigated.
Human Rights Atkore is committed to supporting human rights and fair labor practices. We will not tolerate human rights abuses of any kind, including human trafficking, child labor or incidents of corruption within our company or supply chain. Employees are encouraged to report any potential violations or concerns, and all reports are promptly and impartially investigated.
We have incurred, and expect to continue to incur, capital expenditures in addition to ordinary course costs to comply with applicable current and future environmental, health and safety laws, such as those governing air emissions and wastewater discharges. In addition, government agencies could impose conditions or other restrictions in our environmental permits which increase our costs.
We have incurred, and expect to continue to incur, capital expenditures in addition to ordinary course costs to comply with applicable current and future environmental, health and safety laws, such as those governing air emissions, wastewater discharges and waste disposal. In addition, government agencies could impose conditions or other restrictions in our environmental permits which increase our costs.
Over the past six years, Atkore has made significant investments in technology to improve our business and provide value to our customers. Currently, we operate our business using commercially available hardware and software products with well-developed support services. These commercially available software products include the Company’s general ledger and financial reporting system.
Over the past seven years, Atkore has made significant investments in technology to improve our business and provide value to our customers. Currently, we operate our business using commercially available hardware and software products with well-developed support services. These commercially available software products include the Company’s general ledger and financial reporting system.
A new permit was issued August 5, 2021 that included a less stringent permit limit based on the receiving stream evaluation, which also included a one-year start-up / shake-down period to meet the new zinc limit. We continued to keep the IPEA informed on our progress.
A new permit was issued August 5, 2021 that included a less stringent permit limit based on the receiving stream evaluation, which also included a one-year start-up / shake-down period to meet the new zinc limit. We continued to keep the IEPA informed on our progress.
We primarily sell and distribute our products through electrical, industrial and specialty distributors and OEMs. For many of the more than 13,000 electrical-distributor branches in the United States, our products are must-stock lines that form a staple of their business.
We primarily sell and distribute our products through electrical, industrial and specialty distributors and OEMs. For many of the more than 12,000 electrical-distributor branches in the United States, our products are must-stock lines that form a staple of their business.
Our DEI Steering Committee sponsored a number of community events and contributions in 2023, including back-to-school backpack drives for lower social-economic communities, and engagement with a variety of LGBTQIA+ community organizations, including as a sponsor for the Center on Halsted's annual gala and career fair in Chicago, Illinois. We regularly evaluate our progress on DE&I across the company.
Our DE&I Steering Committee sponsored a number of community events and contributions in 2024, including back-to-school backpack drives for lower social-economic communities, and engagement with a variety of LGBTQIA+ community organizations, including as a sponsor for the Center on Halsted's annual gala and career fair in Chicago, Illinois. We regularly evaluate our progress on DE&I across the company.
We believe customers view Atkore as offering a strong value proposition based on our broad product offering, strong brands, short order cycle times, reliability and consistent product quality. For each of fiscal 2023, 2022 and 2021, approximately 90%, 91%, and 90% respectively, of our net sales were sold to customers located in the United States.
We believe customers view Atkore as offering a strong value proposition based on our broad product offering, strong brands, short order cycle times, reliability and consistent product quality. For each of fiscal 2024, 2023 and 2022, approximately 88%, 90%, and 91% respectively, of our net sales were sold to customers located in the United States.
Some of our products are purchased by OEMs and used as part of their products and solutions in applications such as utility solar framing, and conveyor systems. OEM sales accounted for approximately 13% of our net sales for fiscal 2023.
Some of our products are purchased by OEMs and used as part of their products and solutions in applications such as utility solar framing, and conveyor systems. OEM sales accounted for approximately 13% of our net sales for fiscal 2024.
Our customers include global electrical distributors (such as Consolidated Electrical Distributors, Inc., Graybar Electric Company, Rexel, Sonepar S.A. and Wesco International, Inc.), independent electrical distributors including super-regional electrical distributors (such as U.S.
Our customers include global electrical distributors (such as CED, Graybar Electric Company, Rexel, Sonepar S.A. and Wesco International, Inc.), independent electrical distributors including super-regional electrical distributors (such as U.S.
Distribution-based sales accounted for approximately 83% of our net sales in fiscal 2023. We distribute our products to electrical and industrial distributors from our manufacturing and distribution facilities as well as from over 38 dedicated distribution facilities operated by our agents. Our products are also stocked by electrical and industrial distributors who are located across the United States.
Distribution-based sales accounted for approximately 83% of our net sales in fiscal 2024. We distribute our products to electrical and industrial distributors from our manufacturing and distribution facilities as well as from over 33 dedicated distribution facilities operated by our agents. Our products are also stocked by electrical and industrial distributors who are located across the United States.
In 2023, we expanded the scope DEI related training offerings, building upon our required unconscious bias training for salaried and hourly employees and reflecting our ambition to embed equity and inclusion across our business.
In 2023, we expanded the scope DE&I related training offerings, building upon our required unconscious bias training for salaried and hourly employees and reflecting our ambition to embed equity and inclusion across our business.
Manufacturing We currently manufacture products in 49 facilities and operate a total footprint of approximately 7.5 million square feet of manufacturing and distribution space in eight countries. Our headquarters are located in Harvey, Illinois, which is also the location of our largest manufacturing facility.
Manufacturing We currently manufacture products in 42 facilities and operate a total footprint of approximately 8.5 million square feet of manufacturing and distribution space in eight countries. Our headquarters are located in Harvey, Illinois, which is also the location of our largest manufacturing facility.
In fiscal 2023, our top ten customers accounted for approximately 38% of net sales. For Fiscal 2023, one customer, Sonepar USA accounted for more than 10% of sales, for fiscal 2022 and 2021, no single customer accounted for more than 10% of sales.
In fiscal 2024, our top ten customers accounted for approximately 40% of net sales. For Fiscal 2024 and 2023, one customer, Sonepar USA accounted for more than 10% of sales, and for 2022, no single customer accounted for more than 10% of sales.
The main competitors in each of these segments are listed below: Electrical: Zekelman Industries, Inc., Mitsubishi Corporation, Nucor Corporation, Southwire Company, LLC, Dura-Line Corporation, and Encore Wire Corporation plc.
The main competitors in each of these segments are listed below: Electrical: Zekelman Industries, Inc., Mitsubishi Corporation, Nucor Corporation, Southwire Company, LLC, Dura-Line Corporation, and Prysmian.
Our net sales by geographic area were as follows: Fiscal Year Ended (in millions) September 30, 2023 September 30, 2022 September 30, 2021 United States $ 3,150 $ 3,553 $ 2,637 International 369 361 291 Total $ 3,519 $ 3,914 $ 2,928 Atkore has a well-established customer base, which includes many of the largest companies in their categories.
Our net sales by geographic area were as follows: Fiscal Year Ended (in millions) September 30, 2024 September 30, 2023 September 30, 2022 United States $ 2,818 $ 3,150 $ 3,553 International 384 369 361 Total $ 3,202 $ 3,519 $ 3,914 Atkore has a well-established customer base, which includes many of the largest companies in their categories.
(collectively with all its subsidiaries referred to in this Annual Report on Form 10-K as “Atkore,” the “Company,” “we,” “us,” and “our”) was incorporated in the State of Delaware on November 4, 2010. As of September 30, 2023, Atkore was the sole stockholder of Atkore International Holdings Inc. (“AIH”), which in turn was the sole stockholder of Atkore International, Inc.
(collectively with all its subsidiaries referred to in this Annual Report on Form 10-K as “Atkore,” the “Company,” “we,” “us,” and “our”) was incorporated in the State of Delaware on November 4, 2010. As of September 30, 2024, Atkore was the sole stockholder of Atkore International, Inc. (“AII”).
Our primary raw materials are steel, copper and polyvinyl chloride (“PVC”) resin. We believe that sources for these raw materials are well-established, generally available and are in sufficient quantity that we may avoid disruption to our business if we encounter an interruption from one of our existing suppliers.
We believe that sources for these raw materials are well-established, generally available and are in sufficient quantity that we may avoid disruption to our business if we encounter an interruption from one of our existing suppliers.
We are continually investigating, remediating or addressing contamination at our current and former facilities. For example, we are currently monitoring and passively remediating groundwater contamination at our Wayne, Michigan facility. Future remediation activities may be required to address contamination at or migrating from the Wayne, Michigan site.
We are continually investigating, remediating or addressing contamination at our current and former facilities. For example, we are currently monitoring and passively remediating groundwater contamination at our Wayne, Michigan facility. Future investigation and remediation activities may be required to address contamination at or migrating from the Wayne, Michigan site as well as addressing vapor intrusion issues at nearby residences.
We provide opportunities for advancement through rotational and stretch assignments and best practice leadership roles. In fiscal 2023, approximately 22% of our total positions filled came from internal promotions, highlighting our commitment to developing our employees.
We provide opportunities for advancement through rotational and stretch assignments and best practice leadership roles. In fiscal 2024, approximately 22% of our total positions filled came from internal promotions, highlighting our commitment to developing our employees. Our successful ALDP program continues to generate talented leaders.
We believe Atkore’s investments in safety, health and well-being are critical to supporting and protecting our most important asset: our people. Diversity, Equity and Inclusion At Atkore, we believe that diversity of all types contributes to our success and that our differences make us better.
Every one of our sites completes a self-assessment and certification of completion. 8 We believe Atkore’s investments in safety, health and well-being are critical to supporting and protecting our most important asset: our people. Diversity, Equity and Inclusion At Atkore, we believe that diversity of all types contributes to our success and that our differences make us better.
We seek to ensure that employees, customers, contractors, and visitors to our facilities go home safely at the end of each day, and we empower everyone to proactively identify and eliminate risks to promote an injury-free and incident-free workplace.
Safety, Health and Well-Being At Atkore, nothing is more important than the safety and well-being of our people. We seek to ensure that employees, customers, contractors, and visitors to our facilities go home safely at the end of each day, and we empower everyone to proactively identify and eliminate risks to promote an injury-free and incident-free workplace.
All employees are 8 required to certify compliance with the Life Saving Rules annually. Additionally, our employees are required to receive Atkore Kore Training and Safety Alerts, which cover high-hazard occupational safety concerns and compliance with both internal and external safety and environmental permits. Every one of our sites completes a self-assessment and certification of completion.
All employees are required to certify compliance with the Life Saving Rules annually. Additionally, our employees are required to receive Atkore Kore Training and Safety Alerts, which cover high-hazard occupational safety concerns and compliance with both internal and external safety and environmental permits.
Significant product categories within our Electrical segment include metal electrical conduit and fittings, plastic pipe conduit and fittings, electrical cable and flexible conduit, and international cable management systems, which are critical components of the electrical infrastructure for new construction and MR&R markets.
The majority of Atkore products have Building Information Modeling (“BIM”) models available for our customers’ use. Significant product categories within our Electrical segment include metal electrical conduit and fittings, plastic pipe conduit and fittings, electrical cable and flexible conduit, and international cable management systems, which are critical components of the electrical infrastructure for new construction and MR&R markets.
Talent Development and Retention Our ability to successfully operate, grow and implement key business strategies is dependent upon our ability to attract, develop and retain talented employees at all levels of our Company.
Each of our employees is encouraged to bring their uniqueness to the Company, which unlocks their individual potential and Atkore’s organizational potential. Talent Development and Retention Our ability to successfully operate, grow and implement key business strategies is dependent upon our ability to attract, develop and retain talented employees at all levels of our organization.
The Electrical segment manufactures high quality products used in the construction of electrical power systems including conduit, cable, and installation accessories. This segment serves contractors in partnership with the electrical wholesale channel. The Safety & Infrastructure segment designs and manufactures solutions including metal framing, mechanical pipe, perimeter security, and cable management for the protection and reliability of critical infrastructure.
This segment serves contractors in partnership with the electrical wholesale channel. The Safety & Infrastructure segment designs and manufactures solutions including metal framing, mechanical pipe, perimeter security, and cable management for the protection and reliability of critical infrastructure. These solutions are marketed to contractors, original equipment manufacturers (“OEMs”), and end-users.
Atkore operates under a set of core values of Accountability, Teamwork, Integrity, Respect and Excellence and the Atkore Business System, which prioritizes Strategy, People and Processes, the fundamentals of how we Build Better Together. Our culture provides employees with opportunities for personal and professional development as well as community engagement, all of which contribute to our Company’s overall success.
Atkore operates under a set of core values, which are Accountability, Teamwork, Integrity, Respect and Excellence and under the Atkore Business System, which prioritizes Strategy, People and Processes, the fundamentals of how we Build Better Together.
Sales of our products have historically been higher in the third and fourth quarters of each fiscal year due to favorable weather and longer daylight conditions during these periods. Seasonal variations in operating results may also be significantly impacted by inclement weather conditions, such as cold or wet weather, which can delay construction projects.
Sales of our products have historically been higher in the third and fourth quarters of each fiscal year due to favorable weather and longer daylight conditions during these periods.
The cost of compliance with environmental, health and safety laws and capital expenditures required to meet regulatory requirements is not anticipated to have a material effect on our financial position, results of operations, cash flows or competitive position. 10 In October 2013, the State of Illinois filed a complaint against our subsidiary Allied Tube, alleging violations of the Illinois Environmental Protection Act, or the “IEPA,” relating to discharges to a storm sewer system that terminates at Allied Tube’s Harvey, Illinois manufacturing facility.
In October 2013, the State of Illinois filed a complaint against our subsidiary Allied Tube, alleging violations of the Illinois Environmental Protection Act, or the “IEPA,” relating to discharges to a storm sewer system that terminates at Allied Tube’s Harvey, Illinois manufacturing facility.
Engagement and Alignment We have a culture of engagement and alignment and believe fully engaged employees stay focused on being a standout leader, support the decisions of the leadership team and strive for breakthrough results. An aligned employee lives our mission and values, learns our strategic priorities and links their individual goals to those priorities.
The Company believes our compensation program allows us to attract and retain talented employees. Engagement and Alignment We have a culture of engagement and alignment and believe fully engaged employees stay focused on being a standout leader, support the decisions of the leadership team and strive for breakthrough results.
The quality of our products, strength of our brands, our scale and national presence provide what we believe to be a unique set of competitive advantages that position us for profitable growth. Our mission is to be the customer’s first choice by providing unmatched quality, delivery, and value based on sustainable excellence in strategy, people, and processes.
We believe we hold #1 or #2 positions in the United States by net sales in a significant number of our products. The quality of our products, strength of our brands, our scale and national presence provide what we believe to be a unique set of competitive advantages that position us for profitable growth.
We continuously seek to improve our product offerings and develop innovative new products that meet the changing needs of our customers, which include industry trends toward digital design tools and labor saving solutions. The majority of Atkore products have Building Information Modeling (“BIM”) models available for our customers’ use.
In total, we serve several end-markets, including new non-residential construction, maintenance, repair and remodel (“MR&R”), residential, OEM, and international markets. We continuously seek to improve our product offerings and develop innovative new products that meet the changing needs of our customers, which include industry trends toward digital design tools and labor saving solutions.
The Company rewards employees with competitive compensation and benefits packages, including attractive medical plans, retirement plans, opportunities for annual bonuses and, for eligible employees, long-term incentives and equity-based compensation. The Company believes our compensation program allows us to attract and retain talented employees.
This program provides recent graduates with the opportunity to navigate through a robust two-year rotational program, designed to teach and develop key skills while working within various functions of the organization. The Company rewards employees with competitive compensation and benefits packages, including attractive medical plans, retirement plans, opportunities for annual bonuses and, for eligible employees, long-term incentives and equity-based compensation.
Marketing Our marketing efforts are focused on key stakeholder audiences including electrical and industrial distributors, contractors, engineers, government entities, and OEM customers.
Seasonal variations in operating results may also be significantly impacted by inclement weather conditions, such as cold or wet weather, which can delay construction projects. 6 Marketing Our marketing efforts are focused on key stakeholder audiences including electrical and industrial distributors, contractors, engineers, government entities, and OEM customers.
These laws are subject to change, which can be frequent and material. More stringent federal, state or local environmental rules or regulations could increase our operating costs and expenses.
These laws are subject to change, which can be frequent and material.
Our 2023 engagement and alignment survey had an overall participation rate of 81%. In fiscal 2023, 72% of our hourly workforce participated in the survey, compared to 67% of hourly employees in fiscal 2022. The result of the survey showed the following favorable percentages: Engagement 83%; Alignment 87%; Safety 91%; and Diversity Equity & Inclusion 84%.
An aligned employee lives our mission and values, learns our strategic priorities and links their individual goals to those priorities. Our 2024 engagement and alignment survey had an overall 9 participation rate of 81%. In fiscal 2024, 73% of our hourly workforce participated in the survey, compared to 72% of hourly employees in fiscal 2023.
Our Products Atkore is committed to providing our customers with a safe, sustainable, and innovative portfolio of high quality electrical, mechanical, safety, and infrastructure products and solutions. In total, we serve several end-markets, including new non-residential construction, maintenance, repair and remodel (“MR&R”), residential, OEM, and international markets.
Our mission is to be the customer’s first choice by providing unmatched quality, delivery, and value based on sustainable excellence in strategy, people, and processes. Our Products Atkore is committed to providing our customers with a safe, sustainable, and innovative portfolio of high quality electrical, mechanical, safety, and infrastructure products and solutions.
(“AII”). On December 28, 2022, AIH merged into AII, with AII being the surviving entity. Accordingly, Atkore is now the sole stockholder of AII. We are a leading manufacturer of Electrical products primarily for the non-residential construction and renovation markets, as well as residential markets, and Safety & Infrastructure products for the construction and industrial markets.
We are a leading manufacturer of Electrical products primarily for the non-residential construction and renovation markets, as well as residential markets, and Safety & Infrastructure products for the construction and industrial markets. The Electrical segment manufactures high quality products used in the construction of electrical power systems including conduit, cable, and installation accessories.
From time to time, our collective bargaining agreements expire and come up for re-negotiations. Our collective bargaining agreement with the Teamsters for our New Bedford, Massachusetts facility involving a bargaining unit of 194 employees expired in February 2023, and we successfully negotiated a new agreement, which now expires in February 2028.
From time to time, our collective bargaining agreements expire and come up for re-negotiations. Our Harvey, Illinois collective bargaining agreement with the United Steelworkers Union, which represents approximately 367 employees expired in April 2024. The United Steelworkers Union employees have continued to work thus far during negotiations, which are ongoing.
In addition to many other awards, in 2023, Atkore was recognized as a Great Place to Work-Certified TM company for the third year in a row. Employee Base As of September 30, 2023, we employed approximately 5,600 full-time equivalent employees of whom approximately 14% are temporary or contract workers.
Our culture provides employees with opportunities for personal and professional development as well as community engagement, all of which contribute to our Company’s overall success. In addition to many other awards. In 2024, Atkore was recognized as a Great Place to Work-Certified TM company for the fourth year in a row.
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These solutions are marketed to contractors, original equipment manufacturers (“OEMs”), and end-users. We believe we hold #1 or #2 positions in the United States by net sales in the vast majority of our products.
Added
Our primary raw materials are steel, copper, polyvinyl chloride (“PVC”) resin and high density polyethylene (“HDPE”) though industry supply interruptions have occurred in the past for limited periods of time.
Removed
All unions are either located in the United States or Canada with no unions or Worker’s Councils at any of our other locations abroad. From time to time, our collective bargaining agreements expire and come up for re-negotiations.
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Employee Base We believe our relationship with our employees is good. As of September 30, 2024, we employed approximately 5,600 full-time equivalent employees of whom approximately 6% are temporary or contract workers. Our employees are primarily located in the United States, with about 14% employed at our international locations in Australia, Belgium, Canada, China, New Zealand, and the United Kingdom.
Removed
On July 14, 2020, the Company and the United Steelworkers Union, representing approximately 350 employees, reached an agreement on the terms of a new collective bargaining agreement for our largest facility in Harvey, Illinois, which expires in April 2024. We believe our relationship with our employees is good.
Added
During 2023, we expanded our DE&I reach by introducing location Diversity, Equity and Inclusion champions at many of our locations globally. These champions provide support by bringing greater awareness of DE&I initiatives at a local level and driving many internal and community-based activities.
Removed
Our Harvey, Illinois Special Metal Processing Facility agreement with the United Steelworkers Union, involving a bargaining unit of 20 employees, expired in November 2022, and we successfully negotiated a new agreement, which now expires in November 2025.
Added
More stringent federal, state or local environmental rules or regulations could increase our operating costs and expenses. 10 The cost of compliance with environmental, health and safety laws and capital expenditures required to meet regulatory requirements is not anticipated to have a material effect on our financial position, results of operations, cash flows or competitive position.
Removed
Our Unistrut Construction agreement with the Southern Region Carpenters Union, involving a bargaining unit of 27 employees, expired in November 2022, and we successfully negotiated a new agreement, which now expires in November 2025.
Removed
Our Hebron Ohio facility agreement with the GMPP Alied Worker International Union, involving a bargaining unit of 58 employees, expired in April 2023, and we successfully negotiated a new agreement which now expires in April 2027. Our Harvey, Illinois collective bargaining agreement with the United Steelworkers involving 367 represented employees, is set to expire in April 2024.
Removed
We believe our relationship with our employees is good. Safety, Health and Well-Being At Atkore, nothing is more important than the safety and well-being of our people.
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Our longstanding DE&I Steering Committee leads many of our programs and internal efforts, evaluating how we can continue to improve and create a more inclusive culture. Each employee is encouraged to bring their uniqueness to the Company, which unlocks their individual potential and Atkore’s organizational potential.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

66 edited+15 added−5 removed187 unchanged
Biggest changeIf securities or industry analysts do not publish research or publish misleading or unfavorable research about our business, our stock price and trading volume could decline. The trading market for our common stock depends in part on the research and reports that securities or industry analysts publish about us or our business.
Biggest changeThe trading market for our common stock depends in part on the research and reports that securities or industry analysts publish about us or our business. If one or more of the analysts that covers our common stock downgrades our stock or publishes misleading or unfavorable research about our business, our stock price would likely decline.
Further, to the extent that we declare a regular dividend at a time 26 when market participants hold no such expectations or the amount of any such dividend exceeds current expectations, the price of our common stock may increase and investors that sold shares of our common stock prior to the record date for any such dividend may forego potential gains on their investment.
Further, to the extent that we declare a regular 26 dividend at a time when market participants hold no such expectations or the amount of any such dividend exceeds current expectations, the price of our common stock may increase and investors that sold shares of our common stock prior to the record date for any such dividend may forego potential gains on their investment.
For example, our amended and restated certificate of incorporation and amended and restated by-laws collectively: • authorize the issuance of “blank check” preferred stock that could be issued by our board of directors to thwart a takeover attempt; • limit the ability of stockholders to remove directors; • provide that vacancies on our board of directors, including vacancies resulting from an enlargement of our board of directors, may be filled only by a majority vote of directors then in office; • prohibit stockholders from calling special meetings of stockholders; 27 • prohibit stockholder action by written consent, thereby requiring all actions to be taken at a meeting of stockholders; and • establish advance notice requirements for nominations of candidates for election as directors or to bring other business before an annual meeting of our stockholders.
For example, our amended and restated certificate of incorporation and amended and restated by-laws collectively: 27 • authorize the issuance of “blank check” preferred stock that could be issued by our board of directors to thwart a takeover attempt; • limit the ability of stockholders to remove directors; • provide that vacancies on our board of directors, including vacancies resulting from an enlargement of our board of directors, may be filled only by a majority vote of directors then in office; • prohibit stockholders from calling special meetings of stockholders; • prohibit stockholder action by written consent, thereby requiring all actions to be taken at a meeting of stockholders; and • establish advance notice requirements for nominations of candidates for election as directors or to bring other business before an annual meeting of our stockholders.
Our amended and restated certificate of incorporation provides that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware is, to the fullest extent permitted by law, the sole and exclusive forum for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed to us or our stockholders by any of our directors, officers, other employees, agents or stockholders, (iii) any action asserting a claim arising out of or under the DGCL, or as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware (including, without limitation, any action asserting a claim arising out of or pursuant to our amended and restated certificate of incorporation or our amended and restated by-laws) or (iv) any action asserting a claim that is governed by the internal affairs doctrine.
Our amended and restated certificate of incorporation provides that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware is, to the fullest extent permitted by law, the sole and exclusive forum for (i) any derivative action or proceeding 28 brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed to us or our stockholders by any of our directors, officers, other employees, agents or stockholders, (iii) any action asserting a claim arising out of or under the DGCL, or as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware (including, without limitation, any action asserting a claim arising out of or pursuant to our amended and restated certificate of incorporation or our amended and restated by-laws) or (iv) any action asserting a claim that is governed by the internal affairs doctrine.
In connection with any acquisitions or joint ventures and agreements relating to Tyco’s 2010 sale of a greater than 50% stake in the Company or otherwise, we may acquire or become subject to liabilities such as legal claims, including but not limited to third-party liability and other tort claims; claims for breach of contract; employment-related claims; environmental liabilities, conditions or damage; 22 permitting, regulatory or other compliance with law issues; liability for hazardous materials; or tax liabilities.
In connection with any acquisitions or joint ventures and agreements relating to Tyco’s 2010 sale of a greater than 50% stake in the Company or otherwise, we may acquire or become subject to liabilities such as legal claims, including but not limited to third-party liability and other tort claims; claims for breach of contract; employment-related claims; environmental liabilities, conditions or damage; permitting, regulatory or other compliance with law issues; liability for hazardous materials; or tax liabilities.
The markets for certain of our products are influenced by federal, state, local and international governmental regulations, trade policies and trade groups (such as the CHIPS and Science Act of 2022, the inflation Reduction Act of 2022, other infrastructure legislation, Buy America regulations, American Recovery and Reinvestment Act of 2009, Underwriters Laboratories, National Electrical Code and American Society of Mechanical Engineers) as well as other policies, including those imposed on the non-residential construction industry (such as the National Electrical Code and corresponding state and local laws based on the National Electrical Code).
The markets for certain of our products are influenced by federal, state, local and international governmental regulations, trade policies and trade groups (such as the CHIPS and Science Act of 2022, the Inflation Reduction Act of 2022 (the “IRA”), other infrastructure legislation, Buy America regulations, American Recovery and Reinvestment Act of 2009, Underwriters Laboratories, National Electrical Code and American Society of Mechanical Engineers) as well as other policies, including those imposed on the non-residential construction industry (such as the National Electrical Code and corresponding state and local laws based on the National Electrical Code).
In introducing new products and implementing our innovation strategies, any delays, unexpected costs, diversion of resources, loss of key employees or other setbacks could materially and adversely affect our business, financial position, results of operations or cash flows. We are subject to certain safety and labor risks associated with the manufacturing and testing of our products.
In introducing new products and implementing our innovation strategies, any delays, unexpected costs, diversion of resources, loss of key employees or other setbacks could materially and adversely affect our business, financial position, results of operations or cash flows. 20 We are subject to certain safety and labor risks associated with the manufacturing and testing of our products.
If security measures disrupt or impede the receipt of sufficient raw materials to us and our suppliers, we may fail to meet the needs of our customers or may incur increased expenses to do so. In connection with acquisitions, joint ventures or divestitures, we may become subject to liabilities and required to issue additional debt or equity.
If 22 security measures disrupt or impede the receipt of sufficient raw materials to us and our suppliers, we may fail to meet the needs of our customers or may incur increased expenses to do so. In connection with acquisitions, joint ventures or divestitures, we may become subject to liabilities and required to issue additional debt or equity.
Although weather patterns affect our operating results throughout the year, adverse weather historically has reduced construction activity in our first and second fiscal quarters as construction activity declines due to inclement weather, frozen ground and shorter daylight hours. In contrast, our highest volume of net sales historically has occurred in our third and fourth fiscal quarters.
Although weather patterns affect our operating results throughout the year, adverse weather historically has reduced construction activity in our first and second fiscal quarters as construction activity declines due to inclement weather, frozen ground and shorter daylight hours. In contrast, our 15 highest volume of net sales historically has occurred in our third and fourth fiscal quarters.
We face risks associated with our international operations which could materially and adversely affect our business, financial position, results of operations or cash flows. Our business operates and serves customers in certain foreign countries, including Australia, Belgium, Canada, China, New Zealand, and the United Kingdom.
We face risks associated with our international operations which could materially and adversely affect our business, financial position, results of operations or cash flows. Our business operates and serves customers in certain foreign countries, including Australia, Belgium, Canada, China, Israel, New Zealand, and the United Kingdom.
We may also face reputational challenges if we are unable to verify the origins for all “conflict minerals” used in our products through the procedures we have implemented. We may also encounter challenges to satisfy customers that may require all of the components of products purchased to be certified as conflict free.
We may also face reputational challenges if we are unable 23 to verify the origins for all “conflict minerals” used in our products through the procedures we have implemented. We may also encounter challenges to satisfy customers that may require all of the components of products purchased to be certified as conflict free.
Despite our indebtedness levels, we and our subsidiaries may incur substantially more indebtedness, which may increase the risks created by our indebtedness. We and our subsidiaries may incur substantial additional indebtedness in the future. The terms of thecredit agreements and indenture governing the Credit Facilities do not fully prohibit us or our subsidiaries from incurring additional debt.
Despite our indebtedness levels, we and our subsidiaries may incur substantially more indebtedness, which may increase the risks created by our indebtedness. We and our subsidiaries may incur substantial additional indebtedness in the future. The terms of the credit agreements and indenture governing the Credit Facilities do not fully prohibit us or our subsidiaries from incurring additional debt.
If we are not able to meet customer requirements, customers may choose to disqualify us as a supplier, or we may be forced to reduce our prices to compensate for this lack of certification. 23 Risks Related to Our Indebtedness Our indebtedness may adversely affect our financial health.
If we are not able to meet customer requirements, customers may choose to disqualify us as a supplier, or we may be forced to reduce our prices to compensate for this lack of certification. Risks Related to Our Indebtedness Our indebtedness may adversely affect our financial health.
In the future, our cash flow and capital resources may not be sufficient for the continuation of any dividend programs approved by the board of directors. As a result, we may not be able to pay dividends or continue to pay dividends at the expected rate or at all in November 2023.
In the future, our cash flow and capital resources may not be sufficient for the continuation of any dividend programs approved by the board of directors. As a result, we may not be able to pay dividends or continue to pay dividends at the expected rate or at all in November 2024.
Risks Related to Our Common Stock AI is a holding company with no operations of its own, and it depends on its subsidiaries for cash to fund all of its operations and expenses, including to make future dividend payments, if any.
Risks Related to Our Common Stock Atkore is a holding company with no operations of its own, and it depends on its subsidiaries for cash to fund all of its operations and expenses, including to make future dividend payments, if any.
As of September 30, 2023, assuming availability was fully utilized, each one percentage point change in interest rates would have resulted in a change of approximately $3.3 million in annual interest expense on the ABL Credit Facility.
As of September 30, 2024, assuming availability was fully utilized, each one percentage point change in interest rates would have resulted in a change of approximately $3.3 million in annual interest expense on the ABL Credit Facility.
As of September 30, 2023, each one percentage point change in interest rates would have resulted in a change of approximately $3.8 million in the annual interest expense on the New Senior Secured Term Loan Facility.
As of September 30, 2024, each one percentage point change in interest rates would have resulted in a change of approximately $3.8 million in the annual interest expense on the New Senior Secured Term Loan Facility.
Atkore Inc. (“AI”) and AII are each holding companies, and as such they have no independent operations or material assets other than ownership of equity interests in their respective subsidiaries. AI and AII each depend on their respective subsidiaries to distribute funds to them so that they may pay obligations and expenses, including satisfying obligations with respect to indebtedness.
Atkore and AII are each holding companies, and as such they have no independent operations or material assets other than ownership of equity interests in their respective subsidiaries. Atkore and AII each depend on their respective subsidiaries to distribute funds to them so that they may pay obligations and expenses, including satisfying obligations with respect to indebtedness.
On November 16, 2021, the board of directors approved a share repurchase program for the repurchase of up to an aggregate amount of $400.0 million of the Company’s common stock over a two-year period.
On November 16, 2021, the board of directors approved a share repurchase program (the “2021 Plan”), for the repurchase of up to an aggregate amount of $400.0 million of the Company’s common stock over a two-year period.
On April 6, 2022, the board of directors approved an amendment to the aforementioned plan, extending it to a total repurchase of the Company’s outstanding stock of $800.0 million. On November 11, 2022, the board of directors approved an amendment to the aforementioned plan, extending it to a total repurchase authorization of the Company’s outstanding stock of $1,300 million.
On April 6, 2022, the board of directors approved an amendment to the 2021 Plan, extending it to a total repurchase of the Company’s outstanding stock of $800.0 million. On November 11, 2022, the board of directors approved an amendment to the 2021 Plan, extending it to a total repurchase authorization of the Company’s outstanding stock of $1,300 million.
As of September 30, 2023, approximately 18% of our domestic and international employees were represented with a collective bargaining agreement by labor unions. Several collective bargaining agreements to which the Company is a party, including the agreement covering the Company’s production in Harvey, Illinois, will expire in 2024.
As of September 30, 2024, approximately 20% of our domestic and international employees were represented with a collective bargaining agreement by labor unions. Several collective bargaining agreements to which the Company is a party, including the agreement covering the Company’s production in Harvey, Illinois, will expire in 2024.
As of September 30, 2023, we employed approximately 5,600 total full-time equivalent employees, a significant percentage of whom work at our 49 manufacturing facilities. Our business involves complex manufacturing processes and there is a risk that an accident resulting in property damage, personal injury or death could occur in one of our facilities.
As of September 30, 2024, we employed approximately 5,600 total full-time equivalent employees, a significant percentage of whom work at our 42 manufacturing facilities. Our business involves complex manufacturing processes and there is a risk that an accident resulting in property damage, personal injury or death could occur in one of our facilities.
We expect that share repurchases under the program will be funded with cash on hand. The amount and timing of share repurchases will be based on a variety of factors.
We expect that share repurchases under the Plans will be funded with cash on hand. The amount and timing of share repurchases will be based on a variety of factors.
As of September 30, 2022, one customer, CED National represented 10% of the Company’s accounts receivable, with no significant amounts past due. For fiscal 2023, one customer, Sonepar USA accounted for more than 10% of sales, for fiscal 2022 and 2021, no single customer accounted for more than 10% of sales.
As of September 30, 2023, Sonepar USA represented 14% and CED National represented 11% of the Company’s accounts receivable with no significant amounts past due. For fiscal 2023, one customer, Sonepar USA accounted for more than 10% of sales, for fiscal 2022, no single customer accounted for more than 10% of sales.
The majority of our net sales are facilitated through the extension of credit to our customers, and a significant asset included in our working capital is accounts receivable from customers. As of September 30, 2023, Sonepar USA represented 14% and CED National represented 11% of the Company’s accounts receivable, with no significant amounts past due.
The majority of our net sales are facilitated through the extension of credit to our customers, and a significant asset included in our working capital is accounts receivable from customers. As of 17 September 30, 2024, Sonepar USA represented 17% and CED National represented 11% of the Company’s accounts receivable, with no significant amounts past due.
Among the factors that could affect our stock price are: • industry or general market conditions; • availability of labor and raw materials; • domestic and international economic factors unrelated to our performance; • changes in our customers’ preferences; • new regulatory pronouncements and changes in regulatory guidelines; • lawsuits, enforcement actions and other claims by third parties or governmental authorities; • actual or anticipated fluctuations in our quarterly operating results; • changes in securities analysts’ estimates of our financial performance or lack of research coverage and reports by industry analysts; • action by institutional stockholders or other large stockholders, including future sales of our common stock; • failure to meet any guidance given by us or any change in any guidance given by us, or changes by us in our guidance practices; • announcements by us of significant impairment charges; • speculation in the press or investment community; • investor perception of us and our industry; • changes in market valuations or earnings of similar companies; • announcements by us or our competitors of significant contracts, acquisitions, dispositions or strategic partnerships; • war, terrorist acts and epidemic disease; • any future sales of our common stock or other securities; • additions or departures of key personnel; and • misconduct or other improper actions of our employees. 29 Stock markets have experienced extreme volatility in recent years that has been unrelated to the operating performance of particular companies.
Among the factors that could affect our stock price are: • industry or general market conditions; • availability of labor and raw materials; • domestic and international economic factors unrelated to our performance; • changes in our customers’ preferences; • new regulatory pronouncements and changes in regulatory guidelines; • lawsuits, enforcement actions and other claims by third parties or governmental authorities; • actual or anticipated fluctuations in our quarterly operating results; • changes in securities analysts’ estimates of our financial performance or lack of research coverage and reports by industry analysts; • action by institutional stockholders or other large stockholders, including future sales of our common stock; • failure to meet any guidance given by us or any change in any guidance given by us, or changes by us in our guidance practices; • announcements by us of significant impairment charges; • speculation in the press or investment community; • investor perception of us and our industry; • changes in market valuations or earnings of similar companies; • announcements by us or our competitors of significant contracts, acquisitions, dispositions or strategic partnerships; • war, terrorist acts and epidemic disease; • any future sales of our common stock or other securities; • additions or departures of key personnel; and • misconduct or other improper actions of our employees.
When the networks of our business partners are comprised, this also raises risks regarding payments and orders. 14 Our business, financial position, results of operations or cash flows could be materially and adversely affected by the importation of similar products into the United States, as well as U.S. trade policy and practices.
See Item 1C, “Cybersecurity.” When the networks of our business partners are comprised, this also raises risks regarding payments and orders. 14 Our business, financial position, results of operations or cash flows could be materially and adversely affected by the importation of similar products into the United States, as well as U.S. trade policy and practices.
In fiscal 2023, our ten largest customers (including buyers and distributors in buying groups) accounted for approximately 38% of our net sales. Our percentage of sales to our major customers may increase if we are successful in our strategy of expanding the range of products which we sell to existing customers.
In fiscal 2024, our ten largest customers (including buyers and distributors in buying groups) accounted for approximately 40% of our net sales. Our percentage of sales to our major customers may increase if we are successful in our strategy of expanding the range of products which we sell to existing customers.
United States non-residential construction starts, as reported by Dodge, reached a historic low of 690 million square feet in our fiscal 2010 and increased to 1,468 million square feet in our fiscal 2023, which was above historical average levels.
United States non-residential construction starts, as reported by Dodge, reached a historic low of 690 million square feet in our fiscal 2010 and increased to 1,265 million square feet in our fiscal 2024, which was above historical average levels.
We cannot accurately predict the amount and timing of any impairment of assets, and we may be required to recognize goodwill or other asset impairment charges which could materially and adversely affect our results of operations. See “Item 8.
We cannot accurately predict the amount and timing of any impairment of assets, and we may be required to recognize goodwill or other asset impairment charges which could materially and adversely affect our results of operations. See “Item 8. Financial Statements and Supplementary Data”.
Financial Statements and Supplementary Data”. 19 Our inability to introduce new products effectively or implement our innovation strategies could adversely affect our ability to compete. We continually seek to develop products and solutions that allow us to stay at the forefront of developments in the Electrical and Safety & Infrastructure markets.
Our inability to introduce new products effectively or implement our innovation strategies could adversely affect our ability to compete. We continually seek to develop products and solutions that allow us to stay at the forefront of developments in the Electrical and Safety & Infrastructure markets.
It is difficult to predict whether and when there will be tax law changes having a material adverse effect on our business, financial position, results of operations and cash flows. On August 16, 2022, the Inflation Reduction Act of 2022 (“IRA”) was enacted into law.
It is difficult to predict whether and when there will be tax law changes having a material adverse effect on our business, financial position, results of operations and cash flows. On August 16, 2022, the IRA was enacted into law.
As of September 30, 2023, we had an additional $322.4 million in availability under the ABL Credit Facility. 24 Increases in interest rates would increase the cost of servicing our indebtedness and could reduce our profitability. A portion of our outstanding indebtedness bears interest or will bear interest at variable rates.
As of September 30, 2024, we had an additional $325.0 million in availability under the ABL Credit Facility. 24 Increases in interest rates would increase the cost of servicing our indebtedness and could reduce our profitability. A portion of our outstanding indebtedness bears interest or will bear interest at variable rates.
The United Kingdom has yet to determine which E.U. laws and regulations to replace or replicate and compliance with any amended or additional laws and regulations could increase our costs. To the extent that higher costs are incurred which cannot be passed on to our customers, this could decrease the profitability of our United Kingdom and E.U. operations.
The United Kingdom is still determining which E.U. laws and regulations to replace or replicate and compliance with any amended or additional laws and regulations could increase our costs. To the extent that higher costs are incurred which cannot be passed on to our customers, this could decrease the profitability of our United Kingdom and E.U. operations.
As of September 30, 2023, we had approximately $771.7 million of total long-term consolidated indebtedness outstanding (including current portion) under AI and AII’s credit facilities (“Credit Facilities”), which consist of: (i) an asset-based credit facility (“ABL Credit Facility”); (ii) the new senior secured term loan facility (the “New Senior Secured Term Loan Facility”); and (iii) the 4.25% Senior Notes due 2031 (the “Senior Notes”).
As of September 30, 2024, we had approximately $772.0 million of total long-term consolidated indebtedness outstanding (including current portion) under Atkore and AII’s credit facilities (“Credit Facilities”), which consist of: (i) an asset-based credit facility (“ABL Credit Facility”); (ii) the new senior secured term loan facility (the “New Senior Secured Term Loan Facility”); and (iii) the 4.25% Senior Notes due 2031 (the “Senior Notes”).
The IRA contains significant tax law changes, including a corporate alternative minimum tax of 15% on adjusted financial statement income, which if applicable for us would be effective beginning October 1, 2023, a 1% excise tax on stock repurchases after December 31, 2022, and various tax incentives which include, but are not limited to, credits related to the manufacturing of solar powered energy which took effect January 1, 2023.
The IRA contains significant tax law changes, including a corporate alternative minimum tax of 15% on adjusted financial statement income, which took effect on October 1, 2023, a 1% excise tax on stock repurchases after December 31, 2022, and various tax incentives which include, but are not limited to, credits related to the manufacturing of solar powered energy which took effect on January 1, 2023.
The share repurchase program does not obligate us to acquire any particular amount of common stock, and it may be terminated at any time at the Company’s discretion.
The Plans does not obligate us to acquire any particular amount of common stock, and it may be terminated at any time at the Company’s discretion.
As of September 30, 2023, we estimated that our pension plans were overfunded by approximately $10.1 million, both of which are frozen and do not accrue any additional service cost.
As of September 30, 2024, we estimated that our pension plans were overfunded by approximately $8.7 million, both of which are frozen and do not accrue any additional service cost.
There are certain risks inherent in doing business internationally, including economic volatility and sustained economic downturns, difficulties in enforcing contractual and intellectual property rights, currency exchange rate fluctuations and currency exchange controls, import or export restrictions, sanctions and changes in trade regulations, difficulties in developing, staffing, and simultaneously managing a number of foreign operations as a result of distance, issues related to occupational safety and adherence to local labor laws and regulations, potentially adverse tax developments, longer payment cycles, exposure to different legal standards, political or social unrest, including terrorism, risks related to government regulation and uncertain protection and enforcement of our intellectual property rights, the presence of corruption in certain countries and higher than anticipated costs of entry.
There are certain risks inherent in doing business internationally, including economic volatility and sustained economic downturns, difficulties in enforcing contractual and intellectual property rights, currency exchange rate fluctuations and currency exchange controls, import or export restrictions, sanctions and changes in trade regulations, difficulties in developing, staffing, and simultaneously managing a number of foreign operations as a result of distance, issues related to occupational safety and adherence to local labor laws and regulations, potentially adverse tax developments, longer payment cycles, exposure to different legal standards, political or social unrest, including terrorism, risks related to government regulation and uncertain protection and enforcement of our intellectual property rights, the presence of corruption in certain countries and higher than anticipated costs of entry. 21 In fiscal 2023, the Company initiated plans to exit operations in Russia and recently submitted documents to the Russian approval authority with expectations of completing the sale in FY 2025 albeit at a loss.
The actions of our competitors, including adding production capacity and the expansion of imported products, may encourage us to lower our prices or to offer additional services or enhanced products at a higher cost to us, which could reduce our gross profit, net income or cash flows or may cause us to lose market share.
The actions of our competitors, including adding production capacity and the expansion of imported products, may encourage us to lower our prices or to offer additional services or enhanced products at a higher cost to us, which could reduce our gross profit, net income or cash flows or may cause us to lose market share. 13 Any of these consequences could materially and adversely affect our business, financial position, results of operations or cash flows.
We have registered intellectual property (mainly trademarks and patents) in more than 80 countries. Because of the differences in foreign trademark, patent and other intellectual property or proprietary rights laws, we may not receive the same protection in foreign countries as we would in the United States.
Because of the differences in foreign trademark, patent and other intellectual property or proprietary rights laws, we may not receive the same protection in foreign countries as we would in the United States.
Moreover, we have sustained capital expenditure in complying with applicable health and safety laws and regulations, and any changes to such laws and regulations could increase our costs of operations. 16 We cannot assure you that any costs relating to future capital and operating expenditures to maintain compliance with environmental, health and safety laws, as well as costs to address contamination or environmental claims, will not exceed any current estimates or adversely affect our business, financial position, results of operations or cash flows.
We cannot assure you that any costs relating to future capital and operating expenditures to maintain compliance with environmental, health and safety laws, as well as costs to address contamination or environmental claims, will not exceed any current estimates or adversely affect our business, financial position, results of operations or cash flows.
These laws are subject to change, which could be frequent and material. The imposition of more stringent federal, state or local environmental rules or regulations could increase our operating costs and expenses. In addition, government agencies could impose conditions or other restrictions in our environmental permits which increase our costs.
These laws are subject to change, which could be frequent and material. The imposition of more stringent federal, state or local environmental rules or regulations could increase our operating costs and expenses.
As of September 30, 2023, AII had $322.4 million of available borrowing capacity under the ABL Credit Facility and there were no outstanding borrowings (excluding $2.6 million of letters of credit issued under the facility). Our indebtedness could have important consequences for you.
As of September 30, 2024, AII had $325.0 million of available borrowing capacity under the ABL Credit Facility and there were no outstanding borrowings (there were also no letters of credit issued under the facility). Our indebtedness could have important consequences for you.
While we currently maintain insurance coverage to address a portion of these types of liabilities, we cannot make assurances that we will be able to obtain such insurance on acceptable terms in the future, if at all, or that any such insurance will provide adequate coverage against potential claims.
We cannot assure you that we will not experience material losses or that we will not incur significant costs to defend or pay for such claims. 18 While we currently maintain insurance coverage to address a portion of these types of liabilities, we cannot make assurances that we will be able to obtain such insurance on acceptable terms in the future, if at all, or that any such insurance will provide adequate coverage against potential claims.
Our overall corporate rating and Senior Notes are currently rated as non-investment grade, but our New Senior Secured Term Loan Facility and ABL Credit Facility have been assigned investment grade ratings by certain ratings agencies.
Our overall corporate rating, Senior Notes, New Senior Secured Term Loan Facility and ABL Credit are each currently rated as investment grade by certain agencies while the other agencies have them as non-investment grades.
These broad market fluctuations may adversely affect the trading price of our common stock. In the past, following periods of volatility in the market price of a company’s securities, class action litigation has often been instituted against the affected company.
Stock markets have experienced extreme volatility in recent years that has been unrelated to the operating performance of particular companies. These broad market fluctuations may adversely affect the trading price of our common stock. In the past, following periods of volatility in the market price of a company’s securities, class action litigation has often been instituted against the affected company.
Efforts to attract talent to fill open roles in light of recent constrained labor availability may take more time than in the past and may cost the Company significantly more than in recent years.
Efforts to attract talent to fill open roles in light of recent constrained labor availability may take more time than in the past and may cost the Company significantly more than in recent years. Moreover, the constrained labor conditions may mean that retention of existing talent may require significant additional pay and incentives.
In addition, any accident could result in manufacturing or product delays, which could negatively affect our business, financial position, results of operations or cash flows. See Item 8, “Financial Statements and Supplementary Data”.
In addition, any accident could result in manufacturing or product delays, which could negatively affect our business, financial position, results of operations or cash flows. See Item 8, “Financial Statements and Supplementary Data”. We may not be able to adequately protect our intellectual property rights, and we may become involved in intellectual property disputes.
We may not be able to adequately protect our intellectual property rights, and we may become involved in intellectual property disputes. Our use of contractual provisions, confidentiality procedures and agreements, and patent, trademark, copyright, unfair competition, trade secret and other laws to protect our intellectual property and other proprietary rights may not be adequate.
Our use of contractual provisions, confidentiality procedures and agreements, and patent, trademark, copyright, unfair competition, trade secret and other laws to protect our intellectual property and other proprietary rights may not be adequate. We have registered intellectual property (mainly trademarks and patents) in more than 82 countries.
Any litigation of this type brought against us could result in substantial costs and a diversion of our management’s attention and resources, which could materially and adversely affect our business, financial position, results of operations or cash flows.
Any litigation of this type brought against us could result in substantial costs and a diversion of our management’s attention and resources, which could materially and adversely affect our business, financial position, results of operations or cash flows. 29 If securities or industry analysts do not publish research or publish misleading or unfavorable research about our business, our stock price and trading volume could decline.
Any of these consequences could materially and adversely affect our business, financial position, results of operations or cash flows. 13 Our operating results are sensitive to the availability and cost of freight and energy, which are important in the manufacture and transport of our products. We are dependent on third-party freight carriers to transport many of our products.
Our operating results are sensitive to the availability and cost of freight and energy, which are important in the manufacture and transport of our products. We are dependent on third-party freight carriers to transport many of our products.
We are continuing to evaluate the Model GloBE Rules for Pillar Two and related legislation, and their potential impact on future periods. 30 Changes in U.S. tax law could also have broader implications, including impacts to the economy, currency markets, inflation environment, consumer behavior or competitive dynamics, which are difficult to predict, and may positively or negatively impact our business, financial position, results of operations or cash flows.
Changes in U.S. tax law could also have broader implications, including impacts to the economy, currency markets, inflation environment, consumer behavior or competitive dynamics, which are difficult to predict, and may positively or negatively impact our business, financial position, results of operations or cash flows. 30 Future offerings of debt or equity securities which would rank senior to our common stock may adversely affect the market price of our common stock.
A decrease in liquidity could, among other things, limit our flexibility, including our ability to make capital expenditures and to complete acquisitions that we have identified, thereby materially and adversely affecting our business, financial position, results of operations and cash flows. 17 Widespread public health conditions including pandemics could have a material adverse impact on our business, financial position, results of operations and cash flows.
A decrease in liquidity could, among other things, limit our flexibility, including our ability to make capital expenditures and to complete acquisitions that we have identified, thereby materially and adversely affecting our business, financial position, results of operations and cash flows. We may be required to recognize goodwill, intangible assets or other long-lived asset impairment charges.
The inclusion of this provision in our amended and restated certificate of incorporation may discourage or deter stockholders or management from bringing a lawsuit against directors for a breach of their fiduciary duties, even though such an action, if successful, might otherwise have benefited us and our stockholders. 28 Our amended and restated certificate of incorporation designates the Court of Chancery of the State of Delaware as the sole and exclusive forum for certain litigation that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or stockholders.
Our amended and restated certificate of incorporation designates the Court of Chancery of the State of Delaware as the sole and exclusive forum for certain litigation that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or stockholders.
In addition, we warrant certain of our products to be free of certain defects and could incur costs related to paying warranty claims in connection with defective products. We cannot assure you that we will not experience material losses or that we will not incur significant costs to defend or pay for such claims.
In addition, we warrant certain of our products to be free of certain defects and could incur costs related to paying warranty claims in connection with defective products.
An unsuccessful product liability defense could be highly costly and accordingly result in a decline in revenues and profitability. 20 From time to time, we are also involved in government inquiries and investigations, as well as consumer, employment, tort proceedings and other litigation. We cannot predict with certainty the outcomes of these legal proceedings and other contingencies.
See Note 15, “Commitments and Contingencies” to the accompanying consolidated financial statements included elsewhere in this Annual Report. An unsuccessful product liability defense could be highly costly and accordingly result in a decline in revenues and profitability. From time to time, we are also involved in government inquiries and investigations, as well as consumer, employment, tort proceedings and other litigation.
We may be required to recognize goodwill, intangible assets or other long-lived asset impairment charges. As of September 30, 2023, we had goodwill of $311.1 million, intangible assets of $394.4 million, and other long-lived assets of $679.8 million. Goodwill and indefinite-lived intangible assets are not amortized and are subject to impairment testing at least annually.
As of September 30, 2024, we had goodwill of $314.0 million, intangible assets of $340.4 million, and other long-lived assets of $832.7 million. Goodwill and indefinite-lived intangible assets are not amortized and are subject to impairment testing at least annually.
The outcome of some of these legal proceedings and other contingencies could require us to take actions which would adversely affect our operations or could require us to pay substantial amounts of money. Additionally, defending against these lawsuits and proceedings may involve significant expense and diversion of management’s attention and resources from other matters.
We cannot predict with certainty the outcomes of these legal proceedings and other contingencies. The outcome of some of these legal proceedings and other contingencies could require us to take actions which would adversely affect our operations or could require us to pay substantial amounts of money.
From time to time, we may be held liable for the costs to address contamination at any real property we have ever owned, operated or used in our business activities or as a disposal site. We are currently, and may in the future be, required to investigate, remediate or otherwise address contamination at our current or former facilities.
In addition, government agencies could impose conditions or other restrictions in our environmental permits which increase our costs. 16 From time to time, we may be held liable for the costs to address contamination at any real property we have ever owned, operated or used in our business activities or as a disposal site.
Increased imports of products similar to those manufactured by us in the United States could materially and adversely affect our business, financial position, results of operations or cash flows. We are directly and indirectly subject to legislative and regulatory changes that may affect demand for our products.
Increased imports of products similar to those manufactured by us in the United States could materially and adversely affect our business, financial position, results of operations or cash flows. Contracts for global mega projects are complex and often include risk profiles greater than those of our usual product sales.
Moreover, the constrained labor conditions may mean that retention of existing talent may require significant additional pay and incentives. 18 We have financial obligations relating to pension plans that we maintain in the United States. We provide pension benefits through a number of noncontributory and contributory defined benefit retirement plans covering eligible United States employees.
Compliance with more 19 stringent laws or regulations, or stricter interpretation of existing laws, may require additional expenditures, some of which could be material. We have financial obligations relating to pension plans that we maintain in the United States. We provide pension benefits through a number of noncontributory and contributory defined benefit retirement plans covering eligible United States employees.
One or more of these factors could materially and adversely affect our business, financial position, results of operations or cash flows. 21 Changes in foreign laws and legal systems could materially impact our business.
Accordingly, the Company recognized an impairment of $733 for the year ended September 30, 2024 and continues to recognize any incremental losses on those assets. One or more of these factors could materially and adversely affect our business, financial position, results of operations or cash flows. Changes in foreign laws and legal systems could materially impact our business.
If hurricanes, severe storms, floods, other natural disasters or similar events occur in the geographic regions in which we or our suppliers operate or through which deliveries must travel, our results of operations may be adversely affected. 15 We have incurred and continue to incur significant costs to comply with current and future environmental and health and safety laws and regulations, and our operations expose us to the risk of material environmental and health and safety laws liability.
If hurricanes, severe storms, floods, other natural disasters or similar events occur in the geographic regions in which we or our suppliers operate or through which deliveries must travel, our results of operations may be adversely affected. Labor disputes, increased labor costs or work stoppages could adversely affect our operations and impair our financial performance.
Climate-related events have the potential to disrupt our business, including the business of our suppliers and customers, and may cause us to experience higher attrition, and additional costs to resume operations. Labor disputes, increased labor costs or work stoppages could adversely affect our operations and impair our financial performance.
Climate-related events have the potential to disrupt our business, including the business of our suppliers and customers, and may cause us to experience higher attrition, and additional costs to resume operations. Concern over climate change has led to legislative and regulatory initiatives across various jurisdictions in which we operate.
See Note 15, “Commitments and Contingencies” to the accompanying consolidated financial statements included elsewhere in this Annual Report.
The impacts of this legislation are described in the Summary of Significant Accounting Policies in Note 1, “Basis of Presentation and Summary of Significant Accounting Policies.” Additionally, see Note 7, “Income Taxes” to the accompanying consolidated financial statements included elsewhere in this Annual Report.
Removed
In fiscal 2023, the Company determined it would exit its operations in Russia and expects to sell the related business at a loss. The Company recognized an impairment of $7,477 for the year ended September 30, 2023. The remaining value at risk related to these operations after the impairment is minimal.
Added
Our products can be assembled into interconnected skids to support plant operations and such assemblies have become accepted and used in the designs and construction of large scale manufacturing plants and data centers. The scale of these projects can push our products and services to over tens of millions of dollars or more.
Removed
If one or more of the analysts that covers our common stock downgrades our stock or publishes misleading or unfavorable research about our business, our stock price would likely decline.
Added
Supplying these complex assemblies poses unique challenges, which if not carefully discharged could subject us to warranty, indemnity and other contract obligations that could have a material affect on our results of operations. We are directly and indirectly subject to legislative and regulatory changes that may affect demand for our products.
Removed
We continue to evaluate this legislation and regulatory guidance to determine what impact it will have on our financial statements. On October 8, 2021, the Organization for Economic Co-operation and Development (“OECD”) released a statement on the OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting, which agreed to a two-pillar solution to address tax challenges of the digital economy.
Added
We have incurred and continue to incur significant costs to comply with current and future environmental and health and safety laws and regulations, and our operations expose us to the risk of material environmental and health and safety laws liability.
Removed
On December 20, 2021, the OECD released the Model GloBE Rules for Pillar Two defining a 15% global minimum tax rate for large multinational corporations. The OECD continues to release additional guidance and countries are implementing legislation with widespread adoption of the Model GloBE Rules for Pillar Two expected by calendar year 2024.
Added
We are currently, and may in the future be, required to investigate, remediate or otherwise address contamination at our current or former facilities.
Removed
Future offerings of debt or equity securities which would rank senior to our common stock may adversely affect the market price of our common stock.
Added
Moreover, we have sustained capital expenditure in complying with applicable health and safety laws and regulations, and any changes to such laws and regulations could increase our costs of operations.
Added
Additionally, defending against these lawsuits and proceedings may involve significant expense and diversion of management’s attention and resources from other matters. Widespread public health conditions including pandemics could have a material adverse impact on our business, financial position, results of operations and cash flows.
Added
For example, proposals that would impose mandatory disclosure requirements on greenhouse gas emissions continue to be considered by policy makers and regulators. We cannot predict what climate change related legislation or regulations will be enacted in the future or how existing or future laws or regulations will be administered or interpreted.
Added
In addition the business is pursuing work on data centers or other construction projects in other jurisdictions, for example in Asia and Europe.
Added
On May 2, 2024, the board of directors approved a new share repurchase program (the “2024 Plan”, and together with the 2021 Plan and amendments thereto, the “Plans”) which is scheduled to begin after the repurchase authorization under the 2021 Plan has been exhausted. The 2024 Plan authorizes the Company to repurchase up to $500.0 million of its outstanding stock.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeReportable Segment Owned Facilities Leased Facilities Electrical 16 39 Safety & Infrastructure 7 17 We believe that our facilities are well-maintained and are sufficient to meet our current and projected needs. We also have an ongoing process to continually review and update our real estate portfolio to meet changing business needs.
Biggest changeReportable Segment Owned Facilities Leased Facilities Electrical 15 38 Safety & Infrastructure 6 17 We believe that our facilities are well-maintained and are sufficient to meet our current and projected needs. We also have an ongoing process to continually review and update our real estate portfolio to meet changing business needs.
The following chart identifies the number of owned and leased facilities used by each of our reportable segments as of September 30, 2023. We believe that these facilities, when considered with our corporate headquarters, offices and warehouses are suitable and adequate to support the current needs of our business.
The following chart identifies the number of owned and leased facilities used by each of our reportable segments as of September 30, 2024. We believe that these facilities, when considered with our corporate headquarters, offices and warehouses are suitable and adequate to support the current needs of our business.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeIssuer Purchases of Equity Securities The following table shows our share repurchase programs, on a trade date basis, for each of our fiscal months for the quarter ended September 30, 2023 (in thousands, except per share data): Period Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Program(1) Maximum Value of Shares that May Yet Be Purchased Under the Program(1) July 1, 2023 to July 28, 2023 — $ — — $ 384,095 July 29, 2023 to September 1, 2023 90 $ 153.64 90 $ 370,238 September 2, 2023 - September 30, 2023 406 $ 150.68 406 $ 309,095 Total 496 496 (1) On November 16, 2021, the board of directors approved a share repurchase program, under which the Company may repurchase up to $400.0 million of its outstanding common stock.
Biggest changeIssuer Purchases of Equity Securities The following table shows our share repurchase programs, on a trade date basis, for each of our fiscal months for the quarter ended September 30, 2024 (in thousands, except per share data): Period Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Program(1) Maximum Value of Shares that May Yet Be Purchased Under the Program(1) June 29, 2024 to July 26, 2024 — $ — — $ 28,114 July 27, 2024 to August 30, 2024 1,047 $ 95.49 1,047 $ 428,114 August 31, 2024 - September 30, 2024 — $ — — $ 428,114 Total 1,047 1,047 (1) On November 16, 2021, the board of directors approved the 2021 Plan for the repurchase of up to an aggregate amount of $400.0 million of the Company’s stock over a two-year period..
For a description of the Omnibus Incentive Plan, see Note 5, “Stock Incentive Plan” to the accompanying consolidated financial statements included elsewhere in this Annual Report. Recent Sales of Unregistered Securities There were no sales of unregistered equity securities in fiscal 2023.
For a description of the Omnibus Incentive Plan, see Note 5, “Stock Incentive Plan” to the accompanying consolidated financial statements included elsewhere in this Annual Report. Recent Sales of Unregistered Securities There were no sales of unregistered equity securities in fiscal 2024.
Securities Authorized for Issuance Under Equity Compensation Plans The following table contains information, as of September 30, 2023, about the amount of common shares to be issued upon the exercise of outstanding options, performance share options (“PSUs”) and restricted stock units (“RSUs”) granted under the 2020 Omnibus Incentive Plan and the 2016 Omnibus Incentive Plan (together, the “Omnibus Incentive Plan”). 34 Equity Compensation Plan Information (share amounts in thousands) Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights (1) Weighted Average Exercise Price of Outstanding Options Remaining Available for Future Issuance Under Equity Compensation Plans (excluding securities reflected in (1)) Equity compensation plans approved by shareholders 1,209 $ 32.93 1,805 Equity compensation plans not approved by shareholders — — — Total 1,209 $ 32.93 1,805 (1) Includes 690 stock options, 273 PSUs and 246 RSUs granted to officers pursuant to the Omnibus Incentive Plan.
Securities Authorized for Issuance Under Equity Compensation Plans The following table contains information, as of September 30, 2024, about the amount of common shares to be issued upon the exercise of outstanding options, performance share options (“PSUs”) and restricted stock units (“RSUs”) granted under the 2020 Omnibus Incentive Plan and the 2016 Omnibus Incentive Plan (together, the “Omnibus Incentive Plan”). 35 Equity Compensation Plan Information (share amounts in thousands) Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights (1) Weighted Average Exercise Price of Outstanding Options Remaining Available for Future Issuance Under Equity Compensation Plans (excluding securities reflected in (1)) Equity compensation plans approved by shareholders 830 $ 39.59 1,699 Equity compensation plans not approved by shareholders — — — Total 830 $ 39.59 1,699 (1) Includes 425 stock options, 165 PSUs and 240 RSUs granted to officers pursuant to the Omnibus Incentive Plan.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities Common Stock Market Prices Shares of our common stock have traded on the NYSE under the symbol ATKR since June 10, 2016. ** Assumes $100 invested on October 1, 2018 in stock or index, including reinvestment of dividends.
Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities Common Stock Market Prices Shares of our common stock have traded on the NYSE under the symbol ATKR since June 10, 2016. ** Assumes $100 invested on October 1, 2019 in stock or index, including reinvestment of dividends. 34 Holders As of November 19, 2024, there were two stockholders of record of our common stock.
On April 6, 2022, the board of directors approved an amendment to the aforementioned plan, extending it to a total repurchase of the Company’s outstanding common stock of up to $800.0 million.
On April 6, 2022, the board of directors approved an amendment to the 2021 Plan, extending it to a total repurchase of the Company’s outstanding stock of $800.0 million. On November 11, 2022, the board of directors approved an amendment to the 2021 Plan, extending it to a total repurchase authorization of the Company’s outstanding stock of $1,300 million.
Our board of directors retain the power to modify, suspend or cancel the dividend program in any manner and at any time that our board may deem necessary or appropriate.
The quarterly dividend program and the subsequent consideration, declaration and payment of each quarterly cash dividend will be subject to our board’s approval. Our board of directors retain the power to modify, suspend or cancel the dividend program in any manner and at any time that our board may deem necessary or appropriate.
Under the share repurchase programs, the Company was not obligated to acquire any particular amount of common stock, and it may have been terminated at any time at the Company's discretion.
Under the Plans, the Company was not obligated to acquire any particular amount of common stock, and it may have been terminated at any time at the Company's discretion. The final purchase under the 2021 plan was in August 2024 and the Company began purchasing under the 2024 Plan.
Dividend Policy On November 17, 2023, we announced that our board of directors approved a quarterly dividend program under which the Company intends to pay quarterly cash dividends on our common stock. The quarterly dividend program and the subsequent consideration, declaration and payment of each quarterly cash dividend will be subject to our board’s approval.
This number excludes stockholders whose stock is held in nominee or street name by brokers. Dividend Policy On November 17, 2023, we announced that our board of directors approved a quarterly dividend program under which the Company intends to pay quarterly cash dividends on our common stock.
On November 11, 2022, the board of directors approved an amendment to the aforementioned plan, extending it to a total repurchase authorization of the Company’s outstanding stock of $1,300 million. These share repurchase programs were funded from the Company's available cash balances.
On May 2, 2024, the board of directors approved the 2024 Plan, which is scheduled to begin after the repurchase authorization under the 2021 Plan has been exhausted. The 2024 Plan authorizes the Company to repurchase up to $500.0 million of its outstanding stock. The plans were funded from the Company's available cash balances.
Removed
The Company has updated its peer group by replacing its select peer issuer group with the S&P MidCap 400 Industrials index. The Company made the change from select peer issuers to the published industry index to align this disclosure with the requirements under Item 402(v) of Regulation S-K that are effective for the Company in fiscal 2023.
Removed
The Company’s previously defined peer group included the following group of 10 public companies: • Acuity Brands • Encore Wire Corporation • AZZ Inc. • Hubbell Incorporated Class B • Belden Inc. • Littelfuse, Inc. • Cornerstone Building Brands, Inc. • nVent Electric plc • Eaton Corp.
Removed
Plc • Valmont Industries, Inc. 33 Holders As of November 14, 2023, there was one stockholder of record of our common stock. This number excludes stockholders whose stock is held in nominee or street name by brokers.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeThe $213.9 million increase was primarily driven by improved operating income of $434.9 million year over year and was partially offset by increased tax impacts of $224.8 million, with cash used in working capital relatively flat year over year. 47 Investing activities During fiscal 2022, we used $442.8 million of cash for investing activities compared to $98.0 million during fiscal 2021.
Biggest changeInvesting activities During fiscal 2024, we used $154.3 million of cash for investing activities compared to $302.2 million during fiscal 2023. The $147.8 million decrease in cash used by investing activities was primarily driven 47 by $77.3 million in decreased cash used for acquisitions in fiscal 2024 compared to fiscal 2023 and decreased capital expenditures of $69.0 million.
These decreases are partially offset by increased net sales of $168.9 million from companies acquired during fiscal 2022 and 2023 and higher sales volume of $125.1 million across varying product categories within both the Electrical and the Safety & Infrastructure segments.
These decreases are partially offset by increased net sales of $168.9 million from companies acquired during fiscal 2022 and 2023 higher sales volume of $125.1 million across varying product categories within both the Electrical and the Safety & Infrastructure segments.
Results of Operations Fiscal 2023 Compared to Fiscal 2022 The results of operations for the fiscal years ended September 30, 2023 and September 30, 2022 were as follows: Fiscal year ended ($ in thousands) September 30, 2023 September 30, 2022 Change ($) Change (%) Net sales $ 3,518,761 $ 3,913,949 $ (395,188) (10.1) % Cost of sales 2,179,260 2,273,924 (94,664) (4.2) % Gross profit 1,339,501 1,640,025 (300,524) (18.3) % Selling, general and administrative 388,206 370,044 18,162 4.9 % Intangible asset amortization 57,804 36,176 21,628 59.8 % Operating income 893,491 1,233,805 (340,314) (27.6) % Interest expense, net 35,232 30,676 4,556 14.9 % Other (income) and expense, net 7,969 (490) 8,459 (1,726.3) % Income before income taxes 850,290 1,203,620 (353,330) (29.4) % Income tax expense 160,391 290,186 (129,795) (44.7) % Net income $ 689,899 $ 913,434 $ (223,535) (24.5) % Net sales Change (%) Volume 3.2 % Average selling prices (16.5) % Acquisitions 4.3 % Other (1.1) % Net sales (10.1) % 39 Net sales for fiscal 2023 decreased $395.2 million to $3,518.8 million, a decrease of 10.1%, compared to $3,913.9 million for fiscal 2022.
Fiscal 2023 Compared to Fiscal 2022 The results of operations for the fiscal years ended September 30, 2023 and September 30, 2022 were as follows: Fiscal year ended ($ in thousands) September 30, 2023 September 30, 2022 Change ($) Change (%) Net sales $ 3,518,761 $ 3,913,949 $ (395,188) (10.1) % Cost of sales 2,179,260 2,273,924 (94,664) (4.2) % Gross profit 1,339,501 1,640,025 (300,524) (18.3) % Selling, general and administrative 388,206 370,044 18,162 4.9 % Intangible asset amortization 57,804 36,176 21,628 59.8 % Operating income 893,491 1,233,805 (340,314) (27.6) % Interest expense, net 35,232 30,676 4,556 14.9 % Other (income) and expense, net 7,969 (490) 8,459 (1,726.3) % Income before income taxes 850,290 1,203,620 (353,330) (29.4) % Income tax expense 160,391 290,186 (129,795) (44.7) % Net income $ 689,899 $ 913,434 $ (223,535) (24.5) % Net sales Change (%) Volume 3.2 % Average selling prices (16.5) % Acquisitions 4.3 % Other (1.1) % Net sales (10.1) % Net sales for fiscal 2023 decreased $395.2 million to $3,518.8 million, a decrease of 10.1%, compared to $3,913.9 million for fiscal 2022.
Segment results Electrical Fiscal year ended ($ in thousands) September 30, 2023 September 30, 2022 Change ($) Change (%) Net sales $ 2,675,074 $ 3,013,755 $ (338,681) (11.2) % Adjusted EBITDA 1,004,853 1,273,410 (268,557) (21.1) % Adjusted EBITDA Margin 37.6 % 42.3 % Net sales Change (%) Volume (0.3) % Average selling prices (15.7) % Acquisitions 5.3 % Other (0.5) % Net sales (11.2) % Net sales decreased by $338.7 million, or 11.2%, to $2,675.1 million for fiscal 2023 compared to $3,013.8 million for fiscal 2022.
Segment results Electrical Fiscal year ended ($ in thousands) September 30, 2023 September 30, 2022 Change ($) Change (%) Net sales $ 2,675,074 $ 3,013,755 $ (338,681) (11.2) % Adjusted EBITDA 1,004,853 1,273,410 (268,557) (21.1) % Adjusted EBITDA Margin 37.6 % 42.3 % 44 Net sales Change (%) Volume (0.3) % Average selling prices (15.7) % Acquisitions 5.3 % Other (0.5) % Net sales (11.2) % Net sales decreased by $338.7 million, or 11.2%, to $2,675.1 million for fiscal 2023 compared to $3,013.8 million for fiscal 2022.
Safety & Infrastructure Fiscal year ended ($ in thousands) September 30, 2023 September 30, 2022 Change ($) Change (%) Net sales $ 844,158 $ 900,588 $ (56,430) (6.3) % Adjusted EBITDA $ 103,231 $ 138,390 $ (35,159) (25.4) % Adjusted EBITDA Margin 12.2 % 15.4 % 41 Net sales Change (%) Volume 15.0 % Average selling prices (19.1) % Other (2.2) % Net sales (6.3) % Net sales decreased $56.4 million, or 6.3%, to $844.2 million for fiscal 2023 compared to $900.6 million for fiscal 2022.
Safety & Infrastructure Fiscal year ended ($ in thousands) September 30, 2023 September 30, 2022 Change ($) Change (%) Net sales $ 844,158 $ 900,588 $ (56,430) (6.3) % Adjusted EBITDA $ 103,231 $ 138,390 $ (35,159) (25.4) % Adjusted EBITDA Margin 12.2 % 15.4 % Net sales Change (%) Volume 15.0 % Average selling prices (19.1) % Other (2.2) % Net sales (6.3) % Net sales decreased $56.4 million, or 6.3%, to $844.2 million for fiscal 2023 compared to $900.6 million for fiscal 2022.
During those periods, our MR&R demand as a percentage of total demand typically increases, providing a more consistent revenue stream for our business. Additionally, central bank interest rate increases, inflation, and conflicts in Ukraine and the Middle East are creating additional uncertainty in the global economy, generally, and in the markets in which we operate.
During those periods, our MR&R demand as a percentage of total demand typically increases, providing a more consistent revenue stream for our business. Additionally, central bank interest rate fluctuations, inflation, and conflicts in Ukraine and the Middle East are creating additional uncertainty in the global economy, generally, and in the markets in which we operate.
Additional factors that could cause actual results and outcomes to differ from those reflected in forward-looking statements include, without limitation: • declines in, and uncertainty regarding, the general business and economic conditions in the United States and international markets in which we operate; • weakness or another downturn in the United States non-residential construction industry; • widespread outbreak of diseases, such as the novel coronavirus (COVID-19) pandemic; • changes in prices of raw materials; • pricing pressure, reduced profitability, or loss of market share due to intense competition; • availability and cost of third-party freight carriers and energy; • high levels of imports of products similar to those manufactured by us; • changes in federal, state, local and international governmental regulations and trade policies; • adverse weather conditions; • increased costs relating to future capital and operating expenditures to maintain compliance with environmental, health and safety laws; • reduced spending by, deterioration in the financial condition of, or other adverse developments, including inability or unwillingness to pay our invoices on time, with respect to one or more of our top customers; • increases in our working capital needs, which are substantial and fluctuate based on economic activity and the market prices for our main raw materials, including as a result of failure to collect, or delays in the collection of, cash from the sale of manufactured products; • work stoppage or other interruptions of production at our facilities as a result of disputes under existing collective bargaining agreements with labor unions or in connection with negotiations of new collective bargaining agreements, as a result of supplier financial distress, or for other reasons; 51 • changes in our financial obligations relating to pension plans that we maintain in the United States; • reduced production or distribution capacity due to interruptions in the operations of our facilities or those of our key suppliers; • loss of a substantial number of our third-party agents or distributors or a dramatic deviation from the amount of sales they generate; • security threats, attacks, or other disruptions to our information systems, or failure to comply with complex network security, data privacy and other legal obligations or the failure to protect sensitive information; • possible impairment of goodwill or other long-lived assets as a result of future triggering events, such as declines in our cash flow projections or customer demand and changes in our business and valuation assumptions; • safety and labor risks associated with the manufacture and in the testing of our products; • product liability, construction defect and warranty claims and litigation relating to our various products, as well as government inquiries and investigations, and consumer, employment, tort and other legal proceedings; • our ability to protect our intellectual property and other material proprietary rights; • risks inherent in doing business internationally; • changes in foreign laws and legal systems, including as a result of Brexit; • our inability to introduce new products effectively or implement our innovation strategies; • our inability to continue importing raw materials, component parts and/or finished goods; • the incurrence of liabilities and the issuance of additional debt or equity in connection with acquisitions, joint ventures or divestitures and the failure of indemnification provisions in our acquisition agreements to fully protect us from unexpected liabilities; • failure to manage acquisitions successfully, including identifying, evaluating, and valuing acquisition targets and integrating acquired companies, businesses or assets; • the incurrence of additional expenses, increase in complexity of our supply chain and potential damage to our reputation with customers resulting from regulations related to “conflict minerals”; • disruptions or impediments to the receipt of sufficient raw materials resulting from various anti-terrorism security measures; • restrictions contained in our debt agreements; • failure to generate cash sufficient to pay the principal of, interest on, or other amounts due on our debt; • challenges attracting and retaining key personnel or high-quality employees; • future changes to tax legislation; • failure to generate sufficient cash flow from operations or to raise sufficient funds in the capital markets to satisfy existing obligations and support the development of our business; and • other risks and factors described in this report and from time to time in documents that we file with the SEC.
Additional factors that could cause actual results and outcomes to differ from those reflected in forward-looking statements include, without limitation: • declines in, and uncertainty regarding, the general business and economic conditions in the United States and international markets in which we operate; • weakness or another downturn in the United States non-residential construction industry; • widespread outbreak of diseases; • changes in prices of raw materials; • pricing pressure, reduced profitability, or loss of market share due to intense competition; • availability and cost of third-party freight carriers and energy; • high levels of imports of products similar to those manufactured by us; • changes in federal, state, local and international governmental regulations and trade policies; • adverse weather conditions; • increased costs relating to future capital and operating expenditures to maintain compliance with environmental, health and safety laws; • reduced spending by, deterioration in the financial condition of, or other adverse developments, including inability or unwillingness to pay our invoices on time, with respect to one or more of our top customers; • increases in our working capital needs, which are substantial and fluctuate based on economic activity and the market prices for our main raw materials, including as a result of failure to collect, or delays in the collection of, cash from the sale of manufactured products; • work stoppage or other interruptions of production at our facilities as a result of disputes under existing collective bargaining agreements with labor unions or in connection with negotiations of new collective bargaining agreements, as a result of supplier financial distress, or for other reasons; • changes in our financial obligations relating to pension plans that we maintain in the United States; • reduced production or distribution capacity due to interruptions in the operations of our facilities or those of our key suppliers; • loss of a substantial number of our third-party agents or distributors or a dramatic deviation from the amount of sales they generate; • security threats, attacks, or other disruptions to our information systems, or failure to comply with complex network security, data privacy and other legal obligations or the failure to protect sensitive information; • possible impairment of goodwill or other long-lived assets as a result of future triggering events, such as declines in our cash flow projections or customer demand and changes in our business and valuation assumptions; • safety and labor risks associated with the manufacture and in the testing of our products; • product liability, construction defect and warranty claims and litigation relating to our various products, as well as government inquiries and investigations, and consumer, employment, tort and other legal proceedings; • our ability to protect our intellectual property and other material proprietary rights; • risks inherent in doing business internationally; • changes in foreign laws and legal systems, including as a result of Brexit; • our inability to introduce new products effectively or implement our innovation strategies; • our inability to continue importing raw materials, component parts and/or finished goods; • the incurrence of liabilities and the issuance of additional debt or equity in connection with acquisitions, joint ventures or divestitures and the failure of indemnification provisions in our acquisition agreements to fully protect us from unexpected liabilities; 52 • failure to manage acquisitions successfully, including identifying, evaluating, and valuing acquisition targets and integrating acquired companies, businesses or assets; • the incurrence of additional expenses, increase in complexity of our supply chain and potential damage to our reputation with customers resulting from regulations related to “conflict minerals”; • disruptions or impediments to the receipt of sufficient raw materials resulting from various anti-terrorism security measures; • restrictions contained in our debt agreements; • failure to generate cash sufficient to pay the principal of, interest on, or other amounts due on our debt; • challenges attracting and retaining key personnel or high-quality employees; • future changes to tax legislation; • failure to generate sufficient cash flow from operations or to raise sufficient funds in the capital markets to satisfy existing obligations and support the development of our business; and • other risks and factors described in this report and from time to time in documents that we file with the SEC.
We caution you that forward-looking statements are not guarantees of future performance or outcomes and that actual performance and outcomes, including, without limitation, our actual results of operations, financial condition and liquidity, and the development of the market in which we operate, may differ materially from those made in or suggested by the forward-looking statements contained in this Annual Report.
We caution you that forward-looking statements are not guarantees of future performance or outcomes and that actual performance and outcomes, including, without limitation, our actual results of operations, financial condition and liquidity, and the development of the 51 market in which we operate, may differ materially from those made in or suggested by the forward-looking statements contained in this Annual Report.
Liquidity and Capital Resources On November 17, 2023, we announced that our board of directors approved a quarterly dividend program under which the Company intends to pay quarterly cash dividends on our common stock. The quarterly dividend program and the subsequent consideration, declaration and payment of each quarterly cash dividend will be subject to our board’s approval.
Liquidity and Capital Resources On November 17, 2023, we announced that our board of directors approved a quarterly dividend program under which the Company intends to pay quarterly cash dividends on our common stock. 45 The quarterly dividend program and the subsequent consideration, declaration and payment of each quarterly cash dividend will be subject to our board’s approval.
Any reduction in future taxable income, including but not limited to any future 48 restructuring activities, may require that we record an additional valuation allowance against our deferred tax assets. An increase in the valuation allowance could result in additional income tax expense in such period and could have a significant impact on our future earnings.
Any reduction in future taxable income, including but not limited to any future restructuring activities, may require that we record an additional valuation allowance against our deferred tax assets. An increase in the valuation allowance could result in additional income tax expense in such period and could have a significant impact on our future earnings.
See “Quantitative and Qualitative Disclosures about Market Risk—Foreign Currency Risk.” See Note 1, “Basis of Presentation and Summary of Significant Accounting Policies” to the accompanying consolidated financial statements included elsewhere in this Annual Report. 37 Emerging Industry Trends .
See “Quantitative and Qualitative Disclosures about Market Risk—Foreign Currency Risk.” See Note 1, “Basis of Presentation and Summary of Significant Accounting Policies” to the accompanying consolidated financial statements included elsewhere in this Annual Report. Emerging Industry Trends .
The relief-from-royalty method is used to estimate the cost savings that accrue to the owner of an intangible asset who would otherwise have to pay royalties or license fees on revenues earned through the use of the asset.
The relief-from-royalty method is used to estimate the cost savings that accrue to the owner of an 50 intangible asset who would otherwise have to pay royalties or license fees on revenues earned through the use of the asset.
Cost of sales Change (%) Volume 4.8 % Average input costs (15.0) % Acquisitions 5.8 % Other 0.2 % Cost of sales (4.2) % Cost of sales decreased $94.7 million, or 4.2%, to $2,179.3 million for fiscal 2023 compared to $2,273.9 million for fiscal 2022.
Cost of sales Change (%) Volume 4.8 % Average input costs (15.0) % Acquisitions 5.8 % Other 0.2 % Cost of sales (4.2) % 43 Cost of sales decreased $94.7 million, or 4.2%, to $2,179.3 million for fiscal 2023 compared to $2,273.9 million for fiscal 2022.
For a detailed discussion of the application of these and other accounting policies, see Note 1, “Basis of Presentation and Summary of Significant Accounting Policies” to the accompanying consolidated financial statements included elsewhere in this Annual Report.
For a detailed discussion of the application of these and other accounting policies, see Note 1, “Basis of 48 Presentation and Summary of Significant Accounting Policies” to the accompanying consolidated financial statements included elsewhere in this Annual Report.
Net sales includes gross product sales and freight billed to our customers, net of allowances for rebates, sales incentives, trade promotions, product returns and discounts. 38 Cost of sales Cost of sales includes all costs directly related to the production of goods for sale.
Net sales includes gross product sales and freight billed to our customers, net of allowances for rebates, sales incentives, trade promotions, product returns and discounts. Cost of sales Cost of sales includes all costs directly related to the production of goods for sale.
The key uncertainties in these calculations are the assumptions used in determining the reporting unit’s forecasted future performance, including revenue growth and EBITDA margins, as well as the perceived risk associated 49 with those forecasts.
The key uncertainties in these calculations are the assumptions used in determining the reporting unit’s forecasted future performance, including revenue growth and EBITDA margins, as well as the perceived risk associated with those forecasts.
Comparisons of results for current and any prior periods are not intended to express any future trends, or indications of future performance, unless expressed as such, and should only be viewed as historical data. 52
Comparisons of results for current and any prior periods are not intended to express any future trends, or indications of future performance, unless expressed as such, and should only be viewed as historical data.
The rapid market growth for the use of digital technologies may continue to drive the need for more digital infrastructure such as data centers and the need for advanced warehousing and distribution centers to support e-commerce.
The rapid market growth for the use of digital technologies may continue to drive the need for more 38 digital infrastructure such as data centers and the need for advanced warehousing and distribution centers to support e-commerce.
Recent Accounting Pronouncements 50 See Note 1, “Basis of Presentation and Summary of Significant Accounting Policies” to the accompanying consolidated financial statements included elsewhere in this Annual Report.
Recent Accounting Pronouncements See Note 1, “Basis of Presentation and Summary of Significant Accounting Policies” to the accompanying consolidated financial statements included elsewhere in this Annual Report.
The Company can elect to perform a quantitative or qualitative test of impairment. For fiscal 2023, 2022, and 2021 the Company performed a quantitative impairment assessment for goodwill. The Company calculated the fair value of its six reporting units considering three valuation approaches: (a) the income approach; (b) the guideline public company method; and (c) the comparable transaction method.
The Company can elect to perform a quantitative or qualitative test of impairment. For fiscal 2024, 2023, and 2022 the Company performed a quantitative impairment assessment for goodwill. The Company calculated the fair value of its six reporting units considering three valuation approaches: (a) the income approach; (b) the guideline public company method; and (c) the comparable transaction method.
The aforementioned conflicts and other factors have had and will continue to have adverse effects on global supply chains, which may impact some aspects of our business. Furthermore, we are mindful of the effects that adverse weather, such as hurricanes, can have on our domestic supply chain. 36 Raw Materials.
The aforementioned conflicts and other factors have had and will continue to have adverse effects on global supply chains, which may impact some aspects of our business. Furthermore, we are mindful of the effects that adverse weather, such as hurricanes, can have on our domestic supply chain. 37 Raw Materials.
The key uncertainties in these calculations are the assumptions used in determining the revenue associated with each indefinite-lived intangible asset and the royalty rate. During fiscal year 2023, 2022, and 2021 the results indicated all indefinite-lived intangible assets had significant excess of fair value over the carrying value.
The key uncertainties in these calculations are the assumptions used in determining the revenue associated with each indefinite-lived intangible asset and the royalty rate. During fiscal year 2024, 2023, and 2022 the results indicated all indefinite-lived intangible assets had significant excess of fair value over the carrying value.
We use a variety of raw materials in the manufacture of our products, which primarily include steel, copper, PVC and HDPE resin. We believe that sources for these raw materials are well established, generally available and are in sufficient quantity that we may avoid disruption in our business.
We use a variety of raw materials in the manufacturing of our products, which primarily include steel, copper, PVC and HDPE resin. We believe that sources for these raw materials are well established, generally available and are in sufficient quantity that we may avoid disruption in our business.
The key uncertainties in the guideline public company method and the comparable transaction method calculations are the assumptions used in determining the reporting unit's comparable public companies, comparable transactions and the selection of the market multiples. The Company did not record any goodwill impairments in fiscal 2022 or 2021.
The key uncertainties in the guideline public company method and the comparable transaction method calculations are the assumptions used in determining the reporting unit's comparable public companies, comparable transactions and the selection of the market multiples. The Company did not record any goodwill impairments in fiscal 2024 or 2022.
Limitations on Distributions and Dividends by Subsidiaries AI and AII are each holding companies, and as such have no independent operations or material assets other than ownership of equity interests in their respective subsidiaries.
Limitations on Distributions and Dividends by Subsidiaries Atkore and AII are each holding companies, and as such have no independent operations or material assets other than ownership of equity interests in their respective subsidiaries.
Excluding the goodwill impairment on the Company’s Russia business, as of September 30, 2023, the fair values of the reporting units exceeded their respective carrying amount by 10% or more.
Excluding the goodwill impairment on the Company’s Russia business, as of September 30, 2024, the fair values of the reporting units exceeded their respective carrying amount by 10% or more.
In fiscal 2023, our sales and cost of sales were impacted by pricing normalization in certain raw materials used in our products. We generally sell our products on a spot basis and as such, were exposed to sales prices on our products that decreased faster than the cost for the related raw materials.
In fiscal 2024, our sales and cost of sales were impacted by continued pricing normalization in certain raw materials used in our products. We generally sell our products on a spot basis and as such, were exposed to sales prices on our products that decreased faster than the cost for the related raw materials.
See Note 13, “Debt” to the accompanying consolidated financial statements included elsewhere in this Annual Report. 46 Cash Flows The table below summarizes cash flow information derived from our statements of cash flows for the fiscal years ended September 30, 2023 and September 30, 2022.
See Note 13, “Debt” to the accompanying consolidated financial statements included elsewhere in this Annual Report. Cash Flows The table below summarizes cash flow information derived from our statements of cash flows for the fiscal years ended September 30, 2024 and September 30, 2023.
The borrowing base was estimated to be $325.0 million and approximately $322.4 million was available under the ABL Credit Facility as of September 30, 2023. Our use of cash may fluctuate during the year and from year to year due to differences in demand and changes in economic conditions primarily related to the prices of commodities we purchase.
The borrowing base was estimated to be $325.0 million and approximately $325.0 million was available under the ABL Credit Facility as of September 30, 2024. Our use of cash may fluctuate during the year and from year to year due to differences in demand and changes in economic conditions primarily related to the prices of commodities we purchase.
The table below summarizes cash flow information derived from our statements of cash flows for the fiscal years ended September 30, 2022 and September 30, 2021.
The table below summarizes cash flow information derived from our statements of cash flows for the fiscal years ended September 30, 2023 and September 30, 2022.
We believe we hold #1 or #2 positions in the United States by net sales in the vast majority of our products. The quality of our products, the strength of our brands and our scale and presence provide what we believe to be a unique set of competitive advantages that position us for profitable growth.
We believe we hold #1 or #2 positions in the United States by net sales in a significant number of our products. The quality of our products, the strength of our brands and our scale and presence provide what we believe to be a unique set of competitive advantages that position us for profitable growth.
In fiscal 2023, approximately 10% of our net sales came from customers located outside the United States, most of which were foreign currency sales denominated in British pounds sterling, European euros, Canadian dollars, Australian dollars, and New Zealand dollars. The functional currency of our operations outside the United States is generally the local currency.
In fiscal 2024, approximately 12% of our net sales came from customers located outside the United States, most of which were foreign currency sales denominated in British pounds sterling, European euros, Canadian dollars, Australian dollars, and New Zealand dollars. The functional currency of our operations outside the United States is generally the local currency.
Our products are primarily used by trade contractors in the construction and renovation of non-residential structures such as commercial office buildings, healthcare facilities and manufacturing plants. In fiscal 2023, 90% of our net sales were to customers located in the United States.
Our products are primarily used by trade contractors in the construction and renovation of non-residential structures such as commercial office buildings, healthcare facilities and manufacturing plants. In fiscal 2024, 88% of our net sales were to customers located in the United States.
In total, we have invested $468.5 million in acquisitions since 2021. We expect to continue to pursue synergistic acquisitions as part of our growth strategy to expand our product offerings. See Note 3, “Acquisitions” to the accompanying consolidated financial statements included elsewhere in this Annual Report. Foreign Currencies .
In total, we have invested $424.6 million in acquisitions since 2022. We expect to continue to pursue synergistic acquisitions as part of our growth strategy to expand our product offerings. See Note 3, “Acquisitions” to the accompanying consolidated financial statements included elsewhere in this Annual Report. Foreign Currencies .
Our cash and cash equivalents were $388.1 million as of September 30, 2023, of which $77.2 million was held at non-U.S. subsidiaries. Those cash balances at foreign subsidiaries may be subject to withholding or local country taxes if the Company's intention to permanently reinvest such income were to change and cash was repatriated to the United States.
Our cash and cash equivalents were $351.4 million as of September 30, 2024, of which $101.8 million was held at non-U.S. subsidiaries. Those cash balances at foreign subsidiaries may be subject to withholding or local country taxes if the Company's intention to permanently reinvest such income were to change and cash was repatriated to the United States.
We have access to the ABL Credit Facility to fund our operational needs. As of September 30, 2023, there were no outstanding borrowings under the ABL Credit Facility (excluding $2.6 million of standby letters of credit issued under the ABL Credit Facility).
We have access to the ABL Credit Facility to fund our operational needs. As of September 30, 2024, there were no outstanding borrowings under the ABL Credit Facility (there were no standby letters of credit issued under the ABL Credit Facility).
Our cash and cash equivalents decreased $0.6 million from September 30, 2022, primarily due to acquisitions, capital expenditures and share repurchases and partially offset by cash provided from operating activities. In general, we require cash to fund working capital investments, acquisitions, capital expenditures, debt repayment, interest payments, taxes and share repurchases.
Our cash and cash equivalents decreased $36.7 million from September 30, 2023, primarily due to lower cash provided by operating activities and increased dividend payments, partially offset by less cash used in capital expenditures, acquisitions, and share repurchases. In general, we require cash to fund working capital investments, acquisitions, capital expenditures, debt repayment, interest payments, taxes, dividends and share repurchases.
Business Combinations We account for business combinations using the acquisition method of accounting, which requires that once control is obtained, all the assets acquired and liabilities assumed, including amounts attributable to noncontrolling interests, are recorded at their respective fair values at the date of acquisition.
See Note 7, “Income Taxes” to the accompanying consolidated financial statements included elsewhere in this Annual Report. 49 Business Combinations We account for business combinations using the acquisition method of accounting, which requires that once control is obtained, all the assets acquired and liabilities assumed, including amounts attributable to noncontrolling interests, are recorded at their respective fair values at the date of acquisition.
The increase in expense was primarily due to impairments recognized in connection with the Company’s plans to exit from operations in Russia of $7.5 million. 40 Income tax expense Income tax expense decreased $129.8 million to $160.4 million, compared to $290.2 million for fiscal 2022.
Other (income) and expense, net Other income, net increased $8.5 million to expense of $8.0 million for fiscal 2023, compared to income of $0.5 million for fiscal 2022. The increase in expense was primarily due to impairments recognized in connection with the Company’s plans to exit from operations in Russia of $7.5 million.
Of these amounts, $2.4 million is classified as a non-current liability in the consolidated balance sheet. The projected company pension contribution for fiscal 2024 is $0.3 million.
As of September 30, 2024, we had $2.0 million of income tax liability, gross unrecognized tax benefits of $3.4 million and gross interest and penalties of $0.5 million. Of these amounts, $3.3 million is classified as a non-current liability in the consolidated balance sheet. The projected company pension contribution for fiscal 2025 is $0.4 million.
Capital expenditures have historically been necessary to expand and update the production capacity and improve the productivity of our manufacturing operations and IT initiatives aimed to facilitate the ease of doing business with Atkore. In FY23, $142.7 million was spent on equipment related to growth initiatives in solar, plastics and regional services centers.
Capital expenditures have historically been necessary to expand and update the production capacity and improve the productivity of our manufacturing operations and IT initiatives aimed to facilitate the ease of doing business with Atkore. In FY24, $149.9 million was spent on equipment, which included both routine capital expenditures and spending on growth initiatives such as Water and Global Megaprojects.
These costs include direct material, direct labor, production related overheads, excess and obsolescence costs, lower-of-cost-or-market provisions, freight and distribution costs and the depreciation and amortization of assets directly used in the production of goods for sale.
These costs include direct material, direct labor, production related overheads, excess and obsolescence costs, lower-of-cost-or-market provisions, freight and distribution costs and the depreciation and amortization of assets directly used in the production of goods for sale. 39 Selling, general and administrative expenses Selling, general and administrative expenses include payroll related expenses including salaries, wages, employee benefits, payroll taxes, variable cash compensation for both administrative and selling personnel and consulting and professional services fees.
Selling, general and administrative expenses Selling, general and administrative expenses include payroll related expenses including salaries, wages, employee benefits, payroll taxes, variable cash compensation for both administrative and selling personnel and consulting and professional services fees. Also included are compensation expense for share-based awards, restructuring-related charges, third-party professional services and translation gains or losses for foreign currency trade transactions.
Also included are compensation expense for share-based awards, restructuring-related charges, third-party professional services and translation gains or losses for foreign currency trade transactions.
Servicing of our existing debt instruments includes the following estimated cash outflows: ($ in thousands) Less than 1 Year 1-3 Years 3-5 Years More than 5 Years Total Senior Notes due June 2031 $ — $ — $ — $ 400,000 $ 400,000 New Senior Secured Term Loan Facility Due May 2028 — — — $ 371,667 $ 371,667 Interest payments (a) 47,173 83,958 77,290 51,708 260,129 Total $ 47,173 $ 83,958 $ 77,290 $ 823,375 $ 1,031,796 (a) Interest expense is estimated based on outstanding loan balances assuming principal payments are made according to the payment schedule and interest rates as of September 30, 2023 (4.25% for the Senior Notes, between 5.6% and 7.7% for the New Senior Secured Term Loan Facility).
Servicing of our existing debt instruments includes the following estimated cash outflows: ($ in thousands) Less than 1 Year 1-3 Years 3-5 Years More than 5 Years Total Senior Notes due June 2031 $ — $ — $ — $ 400,000 $ 400,000 New Senior Secured Term Loan Facility Due May 2028 — — 373,000 — 373,000 Interest payments (a) 42,544 78,760 56,091 34,472 211,867 Total $ 42,544 $ 78,760 $ 429,091 $ 434,472 $ 984,867 (a) Interest expense is estimated based on outstanding loan balances assuming principal payments are made according to the payment schedule and interest rates as of September 30, 2024 (4.25% for the Senior Notes, between 5.6% and 7.7% for the New Senior Secured Term Loan Facility). 46 Our ongoing liquidity needs are expected to be funded by cash on hand, net cash provided by operating activities and, as required, borrowings under the Credit Facilities.
We have purchase commitments of $127.8 million and $3.8 million for the years 2023 and 2024, which represent purchases of raw materials in the normal course of business for which all significant terms have been confirmed. 45 As of September 30, 2023, we had $6.3 million of income tax liability, gross unrecognized tax benefits of $3 million and gross interest and penalties of $0.2 million.
We have purchase commitments of $103.2 million and $2.2 million for the years 2025 and 2026, which represent purchases of raw materials in the normal course of business for which all significant terms have been confirmed.
The Company's income tax rate decreased to 18.9% for fiscal 2023, compared to 24.1% for fiscal 2022. The decrease in income tax expense is due to lower income before taxes and solar tax credits generated during fiscal 2023, while the decrease in effective tax rate was primarily due to solar tax credits generated during fiscal 2023.
The decrease in income tax expense is due to lower income before taxes and solar tax credits generated during fiscal 2023, while the decrease in effective tax rate was primarily due to solar tax credits generated during fiscal 2023. See Note 7, “Income Taxes” to the accompanying consolidated financial statements included elsewhere in this Annual Report.
Financing Activities During fiscal 2022, we used $524.2 million for financing activities compared to $184.5 million during fiscal 2021. Cash used for financing activities during fiscal 2022 was primarily driven by repurchases of shares of $500.2 million as compared to $135.1 million of share repurchases in fiscal 2021.
The decrease in cash used for financing activities during fiscal 2024 was primarily driven by repurchases of shares of $381.0 million in fiscal 2024 as compared to $491.0 million of share repurchases in fiscal 2023, partially offset by dividends paid of $34.5 million in fiscal 2024.
The increase was primarily due to higher sales commission expense of $21.1 million, increased general spending on business improvement initiatives of $29.8 million, higher variable compensation of $6.5 million, transaction costs of $2.6 million, and recent acquisitions in fiscal 2021 and 2022 of $7.4 million. The remaining increase of $9.6 million is spread across a variety of other spend categories.
The increase was primarily due to digital initiatives of $10.0 million, increased headcount of $7.5 million, and increased compensation of $3.0 million. These increases were partially offset by increases in productivity of $6.0 million, lower sales commission expense of $4.1 million, and lower costs of $1.1 million spread across a variety of other spend categories.
Safety & Infrastructure Fiscal year ended ($ in thousands) September 30, 2022 September 30, 2021 Change ($) Change (%) Net sales $ 900,588 $ 698,320 $ 202,268 29.0 % Adjusted EBITDA $ 138,390 $ 81,827 $ 56,563 69.1 % Adjusted EBITDA Margin 15.4 % 11.7 % 44 Net sales Change (%) Volume (4.1) % Average selling prices 29.9 % Other 3.2 % Net sales 29.0 % Net sales increased $202.3 million, or 29.0%, to $900.6 million for fiscal 2022 compared to $698.3 million for fiscal 2021.
Safety & Infrastructure Fiscal year ended ($ in thousands) September 30, 2024 September 30, 2023 Change ($) Change (%) Net sales $ 849,077 $ 844,158 $ 4,919 0.6 % Adjusted EBITDA $ 89,982 $ 103,231 $ (13,249) (12.8) % Adjusted EBITDA Margin 10.6 % 12.2 % Net sales Change (%) Volume 8.3 % Average selling prices (3.2) % Solar energy tax credits (4.7) % Other 0.2 % Net sales 0.6 % Net sales increased $4.9 million, or 0.6%, to $849.1 million for fiscal 2024 compared to $844.2 million for fiscal 2023.
The increase in Adjusted EBITDA was largely due to the increase in average selling prices and acquisitions offset by volume declines as discussed above.
The decrease in Adjusted EBITDA was largely due to lower average selling prices over input costs.
Other (income) and expense, net Other income, net increased $17.7 million to $0.5 million for fiscal 2022, compared to income of $18.2 million for fiscal 2021. The increase was primarily due to a $15.5 million business interruption insurance recovery from a flood at one of the Company’s manufacturing facilities.
Other (income) and expense, net Other (income) and expense, net decreased $6.0 million to expense of $2.0 million for fiscal 2024, compared to expense of $8.0 million for fiscal 2023. The decrease in expense was primarily due to impairments recognized in fiscal 2023 in connection with the Company’s plans to exit from operations in Russia of $7.5 million.
Other (income) and expense, net Other (income) and expense, net increased $8.5 million to expense of $8.0 million for fiscal 2023, compared to income of $0.5 million for fiscal 2022.
Income tax expense Income tax expense decreased $46.0 million to $114.4 million, compared to $160.4 million for fiscal 2023. The Company's income tax rate increased to 19.5% for fiscal 2024, compared to 18.9% for fiscal 2023.
The increase is primarily attributed to increased average selling prices of $207.4 million and increased net sales of $18.4 million from companies acquired during fiscal 2022, partially offset by lower volumes of $27.3 million across various steel product categories.
The decrease in net sales is primarily attributed to lower average selling prices of $379.5 million partially offset by increased sales volume of $54.3 million. Adjusted EBITDA Adjusted EBITDA decreased $276.5 million, or 27.5%, to $728.3 million for fiscal 2024 compared to $1,004.9 million for fiscal 2023.
These increases are offset by decreased sales volume of $94.8 million across varying product categories within both the Electrical and the Safety & Infrastructure segments. Pricing for PVC products, as well as other products, has begun to decline from historic highs.
These decreases are partially offset by increased sales volume of $122.6 million across varying product categories within both the Electrical and the Safety & Infrastructure segments. 40 Cost of sales Change (%) Volume 3.9 % Average input costs (4.7) % Solar energy tax credits (3.8) % Freight 1.6 % Other 0.5 % Cost of sales (2.5) % Cost of sales decreased $55.0 million, or 2.5%, to $2,124.2 million for fiscal 2024 compared to $2,179.3 million for fiscal 2023.
The Company's income tax rate decreased to 24.1% for fiscal 2022, compared to 24.6% for fiscal 2021. The increase in income tax expense is due to higher income before taxes, while the decrease in effective tax rate was primarily due to a decrease in state income taxes.
Income tax expense Income tax expense decreased $129.8 million to $160.4 million for fiscal 2023, compared to $290.2 million for fiscal 2022. The Company's income tax rate decreased to 18.9% for fiscal 2023, compared to 24.1% for fiscal 2022.
Removed
See Note 7, “Income Taxes” to the accompanying consolidated financial statements included elsewhere in this Annual Report.
Added
Results of Operations Fiscal 2024 Compared to Fiscal 2023 The results of operations for the fiscal years ended September 30, 2024 and September 30, 2023 were as follows: Fiscal year ended ($ in thousands) September 30, 2024 September 30, 2023 Change ($) Change (%) Net sales $ 3,202,053 $ 3,518,761 $ (316,708) (9.0) % Cost of sales 2,124,214 2,179,260 (55,046) (2.5) % Gross profit 1,077,839 1,339,501 (261,662) (19.5) % Selling, general and administrative 397,544 388,206 9,338 2.4 % Intangible asset amortization 55,511 57,804 (2,293) (4.0) % Operating income 624,784 893,491 (268,707) (30.1) % Interest expense, net 35,584 35,232 352 1.0 % Other (income) and expense, net 1,963 7,969 (6,006) (75.4) % Income before income taxes 587,237 850,290 (263,053) (30.9) % Income tax expense 114,365 160,391 (46,026) (28.7) % Net income $ 472,872 $ 689,899 $ (217,027) (31.5) % Net sales Change (%) Volume 3.5 % Average selling prices (11.5) % Solar energy tax credits (1.1) % Other 0.1 % Net sales (9.0) % Net sales for fiscal 2024 decreased $316.7 million to $3,202.1 million, a decrease of 9.0%, compared to $3,518.8 million for fiscal 2023.
Removed
Fiscal 2022 Compared to Fiscal 2021 The results of operations for the fiscal years ended September 30, 2022 and September 30, 2021 were as follows: Fiscal year ended ($ in thousands) September 30, 2022 September 30, 2021 Change ($) Change (%) Net sales $ 3,913,949 $ 2,928,014 $ 985,935 33.7 % Cost of sales 2,273,924 1,802,401 471,523 26.2 % Gross profit 1,640,025 1,125,613 514,412 45.7 % Selling, general and administrative 370,044 293,019 77,025 26.3 % Intangible asset amortization 36,176 33,644 2,532 7.5 % Operating income 1,233,805 798,950 434,855 54.4 % Interest expense, net 30,676 32,899 (2,223) (6.8) % Loss on extinguishment of debt — 4,202 (4,202) (100.0) % Other (income) and expense, net (490) (18,152) 17,662 (97.3) % Income before income taxes 1,203,620 780,001 423,619 54.3 % Income tax expense 290,186 192,144 $ 98,042 51.0 % Net income $ 913,434 $ 587,857 $ 325,577 55.4 % Net sales Change (%) Volume (3.2) % Average selling prices 34.0 % Acquisitions 3.3 % Other (0.4) % Net sales 33.7 % 42 Net sales for fiscal 2022 increased $985.9 million to $3,913.9 million, an increase of 33.7%, compared to $2,928.0 million for fiscal 2021.
Added
The decrease in net sales is primarily attributed to decreased average selling prices of $406.1 million, and the economic value of solar tax credits to be transferred to certain customers of $38.3 million.
Removed
The increase in net sales is primarily attributed to increased average selling prices of $996.2 million which were mostly driven by the plastic pipe and conduit category within the Electrical segment and increased net sales of $96.4 million from companies acquired during fiscal 2021 and 2022.
Added
The decrease was primarily due to lower input costs of steel, copper and PVC resin of $103.1 million and the benefit of solar tax credits of $84.0 million, partially offset by higher sales volume of $86.5 million and increased freight costs of $34.6 million Selling, general and administrative Selling, general and administrative expenses increased $9.3 million, or 2.4%, to $397.5 million for fiscal 2024 compared to $388.2 million for fiscal 2023.
Removed
Cost of sales Change (%) Volume (2.9) % Average input costs 22.5 % Acquisitions 3.9 % Other 2.7 % Cost of sales 26.2 % Cost of sales increased $471.5 million, or 26.2%, to $2,273.9 million for fiscal 2022 compared to $1,802.4 million for fiscal 2021.
Added
Intangible asset amortization Intangible asset amortization expense decreased $2.3 million, or 4.0%, to $55.5 million for fiscal 2024 compared to $57.8 million for fiscal 2023. The decrease in intangible asset amortization resulted from certain intangibles becoming fully amortized.
Removed
The increase was primarily due to higher input costs of steel, copper and PVC resin of $405.5 million and recent acquisitions during fiscal 2021 and 2022 of $70.4 million, partially offset by lower sales volume of $52.8 million across varying product categories within both the Electrical and the Safety & Infrastructure segments.
Added
Interest expense, net Interest expense, net, increased $0.4 million, or 1.0% to $35.6 million for fiscal 2024, compared to $35.2 million for fiscal 2023. The increase is primarily due to increased interest rates on the Company’s New Senior Secured Term Loan Facility.
Removed
Selling, general and administrative Selling, general and administrative expenses increased $77.0 million, or 26.3%, to $370.0 million for fiscal 2022 compared to $293.0 million for fiscal 2021.
Added
The decrease in income tax expense is due to lower income before taxes, while the increase in effective tax rate was primarily due the benefit of solar credits being recognized in cost of sales in fiscal 2024 where as the benefit of solar tax credits was recognized in income tax expense in fiscal 2023 as described in the Summary of Significant Accounting Policies in Note 1, “Basis of Presentation and Summary of Significant Accounting Policies.” Additionally, see Note 7, “Income Taxes” to the accompanying consolidated financial statements included elsewhere in this Annual Report. 41 Segment results Electrical Fiscal year ended ($ in thousands) September 30, 2024 September 30, 2023 Change ($) Change (%) Net sales $ 2,354,978 $ 2,675,074 $ (320,096) (12.0) % Adjusted EBITDA 728,341 1,004,853 (276,512) (27.5) % Adjusted EBITDA Margin 30.9 % 37.6 % Net sales Change (%) Volume 2.0 % Average selling prices (14.3) % Other 0.3 % Net sales (12.0) % Net sales decreased by $320.1 million, or 12.0%, to $2,355.0 million for fiscal 2024 compared to $2,675.1 million for fiscal 2023.
Removed
Intangible asset amortization Intangible asset amortization expense increased $2.5 million, or 7.5%, to $36.2 million for fiscal 2022 compared to $33.6 million for fiscal 2021. The increase in intangible asset amortization is primarily driven by the acquisition of definite-lived intangible assets in fiscal 2022.
Added
The increase is primarily attributed to higher volumes of $68.3 million partially offset by lower average selling prices of $26.6 million and the economic value of solar tax credits to be transferred to certain customers of $38.3 million. 42 Adjusted EBITDA Adjusted EBITDA decreased $13.2 million, or 12.8%, to $90.0 million for fiscal 2024 compared to $103.2 million for fiscal 2023.
Removed
Interest expense, net Interest expense, net, decreased $2.2 million, or 6.8% to $30.7 million for fiscal 2022, compared to $32.9 million for fiscal 2021. The decrease is primarily due to debt refinancing and principal prepayments in the second half of 2021 resulting in a lower average principal balance in fiscal 2022 from which interest expense was derived.
Added
The Adjusted EBITDA decrease was primarily due to lower average selling prices versus higher input costs, partially offset by the net benefit of solar tax credits.
Removed
See Note 15, “Commitments and Contingencies” and Note 6, “Other Income, net” to the accompanying consolidated financial statements included elsewhere in this Annual Report. 43 Income tax expense Income tax expense increased $98.0 million to $290.2 million, compared to $192.1 million for fiscal 2021.
Added
Fiscal year ended (in thousands) September 30, 2024 September 30, 2023 Change ($) Change (%) Cash flows provided by (used in): Operating activities $ 549,033 $ 807,634 $ (258,601) (32.0) % Investing activities (154,336) (302,150) 147,814 (48.9) % Financing activities (435,282) (506,781) 71,499 (14.1) % Operating activities During fiscal 2024, operating activities provided $549.0 million of cash, compared to $807.6 million during fiscal year 2023.
Removed
See Note 7, “Income Taxes” to the accompanying consolidated financial statements included elsewhere in this Annual Report.
Added
The decrease in cash provided by operating activities was primarily driven by lower operating income of $268.7 million and tax impacts of $6.5 million, partially offset by less cash used in working capital of $5.2 million and higher depreciation and amortization of $15.4 million.
Removed
Segment results Electrical Fiscal year ended ($ in thousands) September 30, 2022 September 30, 2021 Change ($) Change (%) Net sales $ 3,013,755 $ 2,233,299 $ 780,456 34.9 % Adjusted EBITDA 1,273,410 873,868 399,542 45.7 % Adjusted EBITDA Margin 42.3 % 39.1 % Net sales Change (%) Volume (3.1) % Average selling prices 35.2 % Acquisitions 3.5 % Other (0.7) % Net sales 34.9 % Net sales increased by $780.5 million, or 34.9%, to $3,013.8 million for fiscal 2022 compared to $2,233.3 million for fiscal 2021.
Added
Financing Activities During fiscal 2024, we used $435.3 million for financing activities compared to $506.8 million during fiscal 2023.
Removed
The increase in net sales is primarily attributed to increased average selling prices of $788.8 million which were mostly driven by the plastic pipe and conduit category and increased net sales of $78.0 million from companies acquired during fiscal 2021 and 2022. These increases were partially offset by decreased sales volume of $67.4 million.
Removed
Pricing for PVC products, as well as other products, has begun to decline from historic highs. Adjusted EBITDA Adjusted EBITDA increased $399.5 million, or 45.7%, to $1,273.4 million for fiscal 2022 compared to $873.9 million for fiscal 2021.
Removed
Adjusted EBITDA Adjusted EBITDA increased $56.6 million, or 69.1%, to $138.4 million for fiscal 2021 compared to $81.8 million for fiscal 2020. The Adjusted EBITDA increase was primarily due to the increase in average selling prices and volume discussed above.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeOur operating performance may be affected by both upward and downward price fluctuations. We are also exposed to fluctuations in petroleum costs as we deliver a substantial portion of the products we sell by truck.
Biggest changeCommodity Price Risk We are exposed to price fluctuations for our primary raw material commodities such as steel, copper, PVC resin and HDPE resin. Our operating performance may be affected by both upward and downward price fluctuations. We are also exposed to fluctuations in petroleum costs as we deliver a substantial portion of the products we sell by truck.
Additionally, if the ABL Credit Facility were fully utilized, the margin we pay on borrowings would increase by 0.3% from the current level and we would incur additional interest expense of $1 million. Credit Risk We are exposed to credit risk on accounts receivable balances. This risk is mitigated due to our large, diverse customer base.
Additionally, if the ABL Credit Facility were fully utilized, the margin we pay on borrowings would increase by 0.3% from the current level and we would incur additional interest expense of $1 million. 53 Credit Risk We are exposed to credit risk on accounts receivable balances. This risk is mitigated due to our large, diverse customer base.
“Management’s Discussion and Analysis of Financial Condition and Results of Operations” for further details. 53 Foreign Currency Risk Because we conduct our business on an international basis in multiple currencies, we may be adversely affected by foreign exchange rate fluctuations.
“Management’s Discussion and Analysis of Financial Condition and Results of Operations” for further details. Foreign Currency Risk Because we conduct our business on an international basis in multiple currencies, we may be adversely affected by foreign exchange rate fluctuations.
As of September 30, 2023, SOFR exceeded 1.00%; therefore, each one percentage point change in interest rates would result in an approximately $3.8 million change in the annual interest expense on our Senior Secured Term Loan Facility.
As of September 30, 2024, SOFR exceeded 1.00%; therefore, each one percentage point change in interest rates would result in an approximately $3.8 million change in the annual interest expense on our Senior Secured Term Loan Facility.
Although we report financial results in United States dollars, approximately 10% of our net sales and expenses are denominated in currencies other than the United States dollar, particularly British pounds sterling, European euros, Canadian dollars, Australian dollars, and New Zealand dollars.
Although we report financial results in United States dollars, approximately 12% of our net sales and expenses are denominated in currencies other than the United States dollar, particularly British pounds sterling, European euros, Canadian dollars, Australian dollars, and New Zealand dollars.
As a result, we are exposed to fluctuations in interest rates to the extent of our net borrowings under the New Senior Secured Term Loan, which were $373.0 million at September 30, 2023.
As a result, we are exposed to fluctuations in interest rates to the extent of our net borrowings under the New Senior Secured Term Loan, which were $373.0 million at September 30, 2024.
As of September 30, 2023, assuming availability was fully utilized, each one percentage point change in interest rates would result in an approximately $3.3 million change in annual interest expense on the ABL Credit Facility.
As of September 30, 2024, assuming availability was fully utilized, each one percentage point change in interest rates would result in an approximately $3.3 million change in annual interest expense on the ABL Credit Facility.
In fiscal 2023, our ten largest customers (including buyers and distributors in buying groups) accounted for approximately 38% of our net sales. As of September 30, 2023, Sonepar USA represented 14% and CED National represented 11% of the Company’s accounts receivable, with no significant amounts past due.
In fiscal 2024, our ten largest customers (including buyers and distributors in buying groups) accounted for approximately 40% of our net sales. As of September 30, 2024, Sonepar USA represented 17% and CED National represented 11% of the Company’s accounts receivable, with no significant amounts past due.
As of September 30, 2022, one customer, CED National represented 10% of the Company’s accounts receivable, with no significant amounts past due. See Note 17, “Segment Information” to the accompanying consolidated financial statements included elsewhere in this Annual Report. We maintain provisions for potential credit losses and such losses to date have normally been within our expectations.
As of September 30, 2023, Sonepar USA represented 14% and CED National represented 11% of the Company’s accounts receivable with no significant amounts past due. See Note 17, “Segment Information” to the accompanying consolidated financial statements included elsewhere in this Annual Report. We maintain provisions for potential credit losses and such losses to date have normally been within our expectations.
We evaluate the solvency of our customers on an ongoing basis to determine if additional allowances for doubtful accounts receivable need to be recorded. We have historically not been exposed to a material amount of uncollectible receivable balances. Commodity Price Risk We are exposed to price fluctuations for our primary raw material commodities such as steel, copper and PVC resin.
We evaluate the solvency of our customers on an ongoing basis to determine if additional allowances for doubtful accounts receivable need to be recorded. We have historically not been exposed to a material amount of uncollectible receivable balances.

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