Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Summary of Significant Accounting Policies

1. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements include the accounts of Myers Industries, Inc. and all wholly owned subsidiaries (collectively, the “Company”), and have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures are adequate to make the information not misleading. These interim financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2021.

In the opinion of the Company, the accompanying condensed consolidated financial statements contain all adjustments (consisting of normal recurring accruals) necessary to present fairly the financial position as of June 30, 2022, and the results of operations and cash flows for the periods presented. The results of operations for the quarter and six months ended June 30, 2022 are not necessarily indicative of the results of operations that will occur for the year ending December 31, 2022.

Accounting Standards Not Yet Adopted

In December 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. This ASU is intended to improve the accounting for acquired contracts with customers in business combinations by addressing diversity in practice by requiring the acquirer to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606. For the Company, this ASU is effective January 1, 2023. Early adoption is permitted. The amendments within this ASU are required to be applied prospectively to business combinations occurring on or after the effective date. The effect of adopting this guidance will depend on the contract assets and liabilities associated with any future acquisitions.

Fair Value Measurement

The Company follows guidance included in ASC 820, Fair Value Measurements and Disclosures, for its financial assets and liabilities, as required. Under ASC 820, the hierarchy that prioritizes the inputs to valuation techniques used to measure fair value is divided into three levels:

Level 1: Unadjusted quoted prices in active markets for identical assets or liabilities.

Level 2: Unadjusted quoted prices in active markets for similar assets or liabilities, unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active or inputs that are observable either directly or indirectly.

Level 3: Unobservable inputs for which there is little or no market data or which reflect the entity’s own assumptions.

The Company has financial instruments, including cash, accounts receivable, accounts payable and accrued expenses. The fair value of these financial instruments approximates carrying value due to the nature and relative short maturity of these assets and liabilities.

The fair value of debt under the Company’s Loan Agreement, as defined in Note 11, approximates carrying value due to the floating rates and relative short maturity (less than 90 days) of any revolving borrowings under this agreement. The fair value of the Company’s fixed rate senior unsecured notes was estimated using market observable inputs for the Company’s comparable peers with public debt, including quoted prices in active markets and interest rate measurements which are considered Level 2 inputs. At June 30, 2022 and December 31, 2021, the aggregate fair value of the Company's outstanding fixed rate senior unsecured notes was estimated to be $38.3 million and $41.0 million, respectively.

The purchase price allocations associated with the May 31, 2022 acquisition of Mohawk Rubber Sales of New England Inc. ("Mohawk") and the July 30, 2021 acquisition of Trilogy Plastics, Inc. (“Trilogy”), as described in Note 3, required fair value measurements using unobservable inputs which are considered Level 3 inputs. The fair value of the acquired intangible assets was determined using an income approach.

Accumulated Other Comprehensive Income (Loss)

Changes in accumulated other comprehensive income (loss) are as follows:

	Foreign Currency			Defined Benefit Pension Plans			Total
Balance at April 1, 2022	$	(13,365	)	$	(1,466	)	$	(14,831	)
Other comprehensive income (loss) before reclassifications		(1,179	)		—			(1,179	)
Net current-period other comprehensive income (loss)		(1,179	)		—			(1,179	)
Balance at June 30, 2022	$	(14,544	)	$	(1,466	)	$	(16,010	)

	Foreign Currency			Defined Benefit Pension Plans			Total
Balance at April 1, 2021	$	(13,563	)	$	(1,799	)	$	(15,362	)
Other comprehensive income (loss) before reclassifications		470			—			470
Net current-period other comprehensive income (loss)		470			—			470
Balance at June 30, 2021	$	(13,093	)	$	(1,799	)	$	(14,892	)

	Foreign Currency			Defined Benefit Pension Plans			Total
Balance at January 1, 2022	$	(13,935	)	$	(1,466	)	$	(15,401	)
Other comprehensive income (loss) before reclassifications		(609	)		—			(609	)
Net current-period other comprehensive income (loss)		(609	)		—			(609	)
Balance at June 30, 2022	$	(14,544	)	$	(1,466	)	$	(16,010	)

	Foreign Currency			Defined Benefit Pension Plans			Total
Balance at January 1, 2021	$	(13,974	)	$	(1,799	)	$	(15,773	)
Other comprehensive income (loss) before reclassifications		881			—			881
Net current-period other comprehensive income (loss)		881			—			881
Balance at June 30, 2021	$	(13,093	)	$	(1,799	)	$	(14,892	)

Allowance for Credit Losses

Management has established certain requirements that customers must meet before credit is extended. The financial condition of customers is continually monitored and collateral is usually not required. The Company evaluates the collectability of accounts receivable based on a combination of factors. The Company reviews historical trends for credit loss as well as current economic conditions in determining an estimate for its allowance for credit losses. Additionally, in circumstances where the Company is aware of a specific customer’s inability to meet its financial obligations, a specific allowance for credit losses is recorded against amounts due to reduce the net recognized receivable to the amount the Company reasonably expects will be collected.

The changes in the allowance for credit losses for the six months ended June 30, 2022 and 2021 were as follows:

	2022			2021
Balance at January 1	$	2,173		$	2,335
Provision for expected credit loss, net of recoveries		(110	)		504
Write-offs and other		(302	)		(336	)
Balance at June 30	$	1,761		$	2,503