The Company has seven operating segments based on geographic operations that it aggregates into one reportable segment. The Company defines operating segments as components of the organization for which discrete financial information is available and operating results are evaluated on a regular basis by the Chief Operating Decision Maker (“CODM”) in order to assess performance and allocate resources. The Company’s CODM is its Chief Executive Officer. The Company determined it has seven operating segments based on the Company’s seven geographic divisions, which are Central, Midwest, Northeast, Southern, Southeast, Western and Canada. The Company aggregates its operating segments into a single reportable segment based on similarities between the operating segments’ economic characteristics, nature of products sold, production process, type of customer and methods of distribution. The accounting policies of the operating segments are the same as those described in the summary of significant policies. In addition to the Company’s reportable segment, the Company’s consolidated results include both corporate activities and certain other activities. Corporate includes the Company’s corporate office building and support services provided to its subsidiaries. Other includes Tool Source Warehouse, Inc., which functions primarily as an internal distributor of tools.

The CODM assesses the Company’s performance based on the periodic review of net sales, Adjusted EBITDA and certain other measures for each of the operating segments. Adjusted EBITDA is not a recognized financial measure under GAAP. However, we believe it assists investors and analysts in comparing our operating performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance. Management believes Adjusted EBITDA is helpful in highlighting trends in our operating results, while other measures can differ significantly depending on long-term strategic decisions regarding capital structure, the tax jurisdictions in which companies operate and capital investments.

In addition, we utilize Adjusted EBITDA in certain calculations under the ABL Facility and the First Lien Facility. The ABL Facility and the First Lien Facility permit us to make certain additional adjustments in calculating Consolidated EBITDA, such as projected net cost savings, which are not reflected in the Adjusted EBITDA data presented in this Quarterly Report on Form 10-Q.

See “Management’s Discussion and Analysis of Financial Condition and Results of Operations -- Non-GAAP Financial Measures” for a further discussion of this non-GAAP measure.

The following tables present segment results for the three and nine months ended January 31, 2020 and 2019:

The following table presents a reconciliation of Adjusted EBITDA to net income for the three and nine months ended January 31, 2020 and 2019:

(a)	Represents non-cash expense related to stock appreciation rights agreements.

(b)	Represents non-cash compensation expense related to changes in the fair values of noncontrolling interests.

(c)	Represents non-cash equity-based compensation expense related to the issuance of share-based awards.

(d)	Represents severance expenses and other costs permitted in calculations under the ABL Facility and the First Lien Facility.

(e)	Represents costs related to acquisitions paid to third parties.

(f)	Represents the non-cash cost of sales impact of purchase accounting adjustments to increase inventory to its estimated fair value.

(g)	Represents the mark-to-market adjustments for derivative financial instruments.

(h)	Represents costs paid to third-party advisors related to secondary offerings of our common stock.

(i)	Represents costs paid to third-party advisors related to debt refinancing activities.

During the nine months ended January 31, 2020, the Company recorded operating lease ROU assets as a result of the adoption of the new lease guidance. The Company’s geographic divisions, other and corporate segments, recorded $113.3 million, $0.3 million and $5.2 million, respectively, of operating lease ROU assets as of the transition date.

Revenues by Product

The following table presents the Company’s net sales to external customers by main product lines for the three and nine months ended January 31, 2020 and 2019:


	Three Months Ended				Nine Months Ended
	January 31,				January 31,
	2020		2019		2020		2019
	(in thousands)
Wallboard	$	314,391	$	297,358	$	1,006,604	$	949,781
Ceilings		112,768		105,219		364,685		339,450
Steel framing		118,823		117,432		386,811		382,304
Other products		215,370		203,893		712,357		664,348
Total net sales	$	761,352	$	723,902	$	2,470,457	$	2,335,883

Geographic Information

The following table presents the Company’s net sales by major geographic area for the three and nine months ended January 31, 2020 and 2019:


	Three Months Ended				Nine Months Ended
	January 31,				January 31,
	2020		2019		2020		2019
	(in thousands)
United States	$	661,491	$	624,672	$	2,136,968	$	2,021,750
Canada		99,861		99,230		333,489		314,133
Total net sales	$	761,352	$	723,902	$	2,470,457	$	2,335,883

Net sales for Canada for the nine months ended January 31, 2020 includes nine months of net sales compared to eight months for the prior year period due to the Company’s acquisition of Titan on June 1, 2018. The average exchange rates for translating Canada net sales from Canadian dollars to U.S. dollars were 0.7600 and 0.7555 for the three and nine months ended January 31, 2020, respectively. The average exchange rates were and 0.7491 and 0.7609 for the three and eight months ended January 31, 2019, respectively.

The following table presents the Company’s property and equipment, net, by major geographic area as of January 31, 2020 and April 30, 2019:


	January 31,		April 30,
	2020		2019
	(in thousands)
United States	$	268,599	$	249,857
Canada		37,873		32,492
Total property and equipment, net	$	306,472	$	282,349