Fair Value Measurements

3 Months Ended

Jul. 31, 2025

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following table presents the estimated carrying amount and fair value of the Company’s assets and liabilities measured at fair value on a recurring basis:

	July 31, 2025		April 30, 2025
	(in thousands)
Assets:
Interest rate swaps and collars (Level 2)	$	1,397	$	527
Liabilities:
Contingent consideration (Level 3)	$	28,539	$	28,059

Interest rate swaps and collars. The Company had interest rate swap agreements that were effective May 31, 2023 and expired April 30, 2025 with notional amounts totaling $300.0 million to convert the variable interest rate on a portion of the term loans outstanding to a fixed 1-month SOFR interest rate of 3.899%. The Company also has forward interest rate collars effective April 30, 2025 and expiring April 30, 2029 with notional amounts totaling $300.0 million. The objective of such hedging instruments is to reduce the variability of interest payment cash flows associated with the variable interest rates under the Term Loan Facility and otherwise hedge exposure to future interest rate fluctuations. The Company believes there have been no material changes in the creditworthiness of the counterparties to these interest rate swaps and believes the risk of nonperformance by each party is minimal. The Company designated the interest rate swaps and collars as cash flow hedges.

As of July 31, 2025, $0.3 million of the interest rate collar assets were classified in prepaid expenses and other current assets in the Condensed Consolidated Balance Sheet and $1.1 million were classified in other assets. The Company recognized gains of $0.2 million and $1.1 million during the three months ended July 31, 2025 and 2024, respectively, related to its interest rate swaps and collars. These amounts are included in interest expense in the Condensed Consolidated Statements of Operations and Comprehensive Income and within cash flows from operating activities within the Condensed Consolidated Statements of Cash Flows. As of July 31, 2025, the Company expects that approximately $0.3 million of pre-tax earnings will be reclassified from accumulated other comprehensive income (loss) into earnings during the next twelve months.

The fair value of interest rate swap and collar agreements is determined using Level 2 inputs. Generally, the Company obtains the Level 2 inputs from its counterparties. Substantially all the inputs throughout the full term of the instruments can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace. The fair value of the Company’s interest rate swap and collar agreements was determined using widely accepted valuation techniques, including a discounted cash flow analysis on the expected cash flows of the derivative. This analysis reflected the contractual terms of the derivatives, including the period to maturity, and used observable market-based inputs, including interest rate curves and implied volatilities.

Contingent consideration. The Company entered into contingent consideration arrangements in connection with its acquisition of Yvon Building Supply, Inc., Yvon Insulation Corporation, Yvon Insulation Windsor, Laminated Glass Technologies, Inc., and Right Fit Foam Insulation Ltd. (collectively, “Yvon”) in which the Company will make additional payments to the sellers ranging from zero dollars to a maximum amount of $33.5 million ($46.0 million Canadian dollars) based on the purchase volumes of certain customers, that are payable in cash to the sellers over five years. The fair value of contingent consideration is determined using a Monte Carlo simulation which uses Level 3 unobservable inputs. The significant unobservable inputs used to calculate the fair value of the contingent consideration include estimated future cash flows, discount rates, and volatility of forecasted revenue. Actual results may differ from the projected results and could have a significant impact on the estimated fair value of the contingent consideration. Additionally, as the liability is stated at present value, the passage of time alone will increase the estimated fair value of the liability each reporting period. Changes in fair value are recorded in other income in the Condensed Consolidated Statements of Operations and Comprehensive Income.

The following table presents the changes in the fair value of the Company’s Level 3 liabilities during the three months ended July 31, 2025:

	Contingent Consideration
	(in thousands)
Balance as of April 30, 2025	$	28,059
Change in fair value	485
Translation adjustment	(5)
Balance as of July 31, 2025	$	28,539

The contingent consideration is classified in the Condensed Consolidated Balance Sheet based on expected payment dates. As of July 31, 2025, $5.8 million of the contingent consideration liability was classified within other accrued expenses and current liabilities in the Condensed Consolidated Balance Sheet and $22.7 million was classified within other liabilities.

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

Disclosures are required for certain assets and liabilities that are measured at fair value on a nonrecurring basis in periods after initial recognition. Such measurements of fair value relate primarily to assets and liabilities measured at fair value in connection with business combinations and long-lived asset impairments. For more information on business combinations, see Note 2, “Business Combinations.” During the three months ended July 31, 2025, the Company recorded $1.1 million for impairment of operating lease ROU assets. There were no other material long-lived asset impairments during the three months ended July 31, 2025 or 2024.

Fair Value of Debt

The estimated fair value of the Company’s Senior Notes was determined based on Level 2 inputs using observable market prices in less active markets. The carrying amounts of the Company’s Term Loan Facility and ABL Facility approximate their fair value, as the interest rates are variable and reflective of market rates. The following table presents the carrying amount and fair value of the Company’s Senior Notes:

	July 31, 2025				April 30, 2025
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
	(in thousands)
Senior Notes	$	350,000	$	350,875	$	350,000	$	330,012