SiteOne Landscape Supply, Inc 10-K for FY2019

SiteOne Landscape Supply, Inc. (SITE)

10-K 2020-02-26 For: 2019-12-29

Added on April 07, 2026

About this 10-K

SiteOne Landscape Supply, Inc filed this 10-K on February 26, 2020, covering the fiscal year ended December 29, 2019 (FY2019).

Headline figures

Fiscal year ended December 29, 2019, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $2.36B; up 11.6% from $2.11B a year earlier
Net income: $77.7M; up 5.1% from net income of $73.9M a year earlier
Diluted EPS: $1.82; up 5.2% from $1.73 a year earlier

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Delaware	46-4056061
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)



Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value per share	SITE	New York Stock Exchange



Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐




TABLE OF CONTENTS
		Page number
PART I
	Item 1. Business	3
	Item 1A. Risk Factors	11
	Item 1B. Unresolved Staff Comments	25
	Item 2. Properties	26
	Item 3. Legal Proceedings	27
	Item 4. Mine Safety Disclosures	27
PART II
	Item 5. Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	28
	Item 6. Selected Financial Data	30
	Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations	32
	Item 7A. Quantitative and Qualitative Disclosures about Market Risk	48
	Item 8. Financial Statements and Supplementary Data	49
	Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	84
	Item 9A. Controls and Procedures	84
	Item 9B. Other Information	86
PART III
	Item 10. Directors, Executive Officers, and Corporate Governance	87
	Item 11. Executive Compensation	87
	Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	87
	Item 13. Certain Relationships and Related Transactions, and Director Independence	87
	Item 14. Principal Accountant Fees and Services	87
PART IV
	Item 15. Exhibits and Financial Statement Schedules	88
	Item 16. Form 10-K Summary	94
SIGNATURES		95



State /Province	Number of Locations	State /Province	Number of Locations
California	73	Oklahoma	5
Florida	60	Wisconsin	5
Texas	37	Oregon	4
North Carolina	36	Nevada	4
Massachusetts	30	Kentucky	3
New York	20	Nebraska	3
Michigan	20	New Hampshire	3
South Carolina	18	Utah	3
New Jersey	17	Hawaii	2
Georgia	17	Delaware	2
Virginia	16	Iowa	2
Illinois	16	Louisiana	2
Missouri	15	Arkansas	1
Connecticut	15	Maine	1
Ohio	13	Mississippi	1
Colorado	12	New Mexico	1
Pennsylvania	11	North Dakota	1
Tennessee	11	Rhode Island	1
Washington	10	South Dakota	1
Indiana	10	Ontario	6
Maryland	10	British Columbia	4
Alabama	6	Alberta	2
Minnesota	6	Manitoba	1
Arizona	6	Québec	1
Idaho	5	Saskatchewan	1
Kansas	5



☒	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


•	cyclicality in residential and commercial construction markets;


•	weather conditions, seasonality, and availability of water to end-users;


•	public perceptions that our products and services are not environmentally friendly;


•	ability to implement our business strategies and achieve our growth objectives;


•	adverse credit and financial markets events and conditions;


•	laws and government regulations applicable to our business that could negatively impact demand for our products;


•	our substantial indebtedness and our ability to obtain financing in the future;


•	risks related to other factors discussed under “Risk Factors” and elsewhere in this Annual Report on Form 10-K.


•	competitive industry pressures;


•	product shortages and the loss of key suppliers;


•	product price fluctuations;


•	ability to pass along product cost increases;


•	failure to successfully implement infrastructure, logistics and systems integration which could, among other things, increase the risk of a cybersecurity incident;


•	our ability to engage in acquisitions without raising additional equity or obtaining additional debt financing is limited;


•	our ability to obtain additional financing for working capital, capital expenditures, acquisitions, debt service requirements or general corporate purposes and our ability to satisfy our obligations with respect to our indebtedness may be impaired in the future;


•	a large portion of our cash flow from operations must be dedicated to the payment of principal and interest on our indebtedness, thereby reducing the funds available to us for other purposes;


•	although we enter into interest rate hedging transactions periodically, we are exposed to the risk of increased interest rates because borrowings under the Credit Facilities and certain floating rate operating and finance leases are at variable rates of interest;


•	it may be more difficult for us to satisfy our obligations to our creditors, resulting in possible defaults on, and acceleration of, such indebtedness;


•	we may be more vulnerable to general adverse economic and industry conditions;


•	we may be at a competitive disadvantage compared to our competitors with proportionately less indebtedness or with comparable indebtedness on more favorable terms and, as a result, they may be better positioned to withstand economic downturns;


•	our ability to refinance indebtedness may be limited or the associated costs may increase;


•	our flexibility to adjust to changing market conditions and ability to withstand competitive pressures could be limited; and


•	we may be prevented from carrying out capital spending and restructurings that are necessary or important to our growth strategy and efforts to improve operating margins of our businesses.


•	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;


•	authorize the issuance of “blank check” preferred stock that could be issued by our board of directors to thwart a takeover attempt;


•	provide for a classified board of directors, which divides our board of directors into three classes, with members of each class serving staggered three-year terms, which prevents stockholders from electing an entirely new board of directors at an annual meeting;


•	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 stockholder action by written consent, thereby requiring all actions to be taken at a meeting of the 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.



	Year ended
	December 29, 2019		December 30, 2018		December 31, 2017		January 1, 2017			January 3, 2016
	(in millions, except share and per share data)
Statement of operations data:
Net sales	$	2,357.5	$	2,112.3	$	1,861.7	$	1,648.2		$	1,451.6
Cost of goods sold	1,584.3		1,434.2		1,266.2		1,132.5			1,022.5
Gross profit	773.2		678.1		595.5		515.7			429.1
Selling, general and administrative	654.3		578.8		502.2		446.5			373.3
Other income	6.0		8.0		4.5		4.8			4.0
Operating income	124.9		107.3		97.8		74.0			59.8
Interest and other non-operating expenses	33.4		32.1		25.2		22.1			11.4
Income before taxes	91.5		75.2		72.6		51.9			48.4
Income tax expense	13.8		1.3		18.0		21.3			19.5
Net income	$	77.7	$	73.9	$	54.6	$	30.6		$	28.9
Net income (loss) attributable to common shares⁽¹⁾	$	77.7	$	73.9	$	54.6	$	(91.4	)	$	(14.8	)
Net income (loss) per common share:
Basic	$	1.89	$	1.83	$	1.37	$	(3.01	)	$	(1.04	)
Diluted	$	1.82	$	1.73	$	1.29	$	(3.01	)	$	(1.04	)
Weighted average number of common shares outstanding:
Basic	41,218,843		40,488,196		39,754,595		30,316,087			14,209,843
Diluted	42,750,348		42,633,309		42,193,432		30,316,087			14,209,843



	As of December 29, 2019	As of December 30, 2018	As of December 31, 2017	As of January 1, 2017	As of January 3, 2016
Balance sheet data:	(in millions)
Total assets	1,443.3	1,168.5	910.7	742.6	668.7
Total debt ⁽²⁾	524.9	558.2	463.6	375.5	177.7
Redeemable convertible preferred stock	—	—	—	—	216.8


(2)	Total debt includes current and non-current portions of long-term debt offset by unamortized debt discount and issuance costs.