10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

____________________________

FORM 10-Q

____________________________

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

For the quarterly period ended April 2, 2023

or

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

For the transition period from _____ to _____

Commission File Number: 001-11796

____________________________

Masonite International Corporation

(Exact name of registrant as specified in its charter)

____________________________

British Columbia, Canada	98-0377314
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

2771 Rutherford Road

Concord, Ontario L4K 2N6 Canada

(Address of principal executive offices)

(800) 895-2723

(Registrant's telephone number, including area code)

____________________________

Securities registered pursuant to Section 12(b) of the Act:
Common Stock (no par value)	DOOR	New York Stock Exchange
(Title of class)	(Trading symbol)	(Name of exchange on which registered)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

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

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date:

The registrant had outstanding 22,112,520 shares of Common Stock, no par value, as of May 5, 2023.

MASONITE INTERNATIONAL CORPORATION

INDEX TO QUARTERLY REPORT ON FORM 10-Q

April 2, 2023

PART I		Page
Item 1	Unaudited Financial Statements
	Condensed Consolidated Statements of Income and Comprehensive Income	1
	Condensed Consolidated Balance Sheets	2
	Condensed Consolidated Statements of Changes in Equity	3
	Condensed Consolidated Statements of Cash Flows	4
	Notes to the Condensed Consolidated Financial Statements	5
Item 2	Management's Discussion and Analysis of Financial Condition and Results of Operations	19
Item 3	Quantitative and Qualitative Disclosures About Market Risk	29
Item 4	Controls and Procedures	29
PART II
Item 1	Legal Proceedings	30
Item 1A	Risk Factors	30
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	30
Item 3	Defaults Upon Senior Securities	30
Item 4	Mine Safety Disclosures	30
Item 5	Other Information	31
Item 6	Exhibits	31

i

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains "forward-looking statements" within the meaning of the federal securities laws, including, without limitation, statements concerning the conditions in our industry, our operations, our economic performance and financial condition, including, in particular, statements relating to our business and growth strategy and product development efforts under "Management's Discussion and Analysis of Financial Condition and Results of Operations." Forward-looking statements include all statements that do not relate solely to historical or current facts and can be identified by the use of words such as "may," "might," "could," "will," "would," "should," "expect," "believes," "outlook," "predict," "forecast," "objective," "remain," "anticipate," "estimate," "potential," "continue," "plan," "project," "targeting," and other similar expressions. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates. These forward-looking statements are based on estimates and assumptions by our management that, although we believe to be reasonable, are inherently uncertain and subject to a number of risks and uncertainties. These risks and uncertainties include, without limitation, those identified under "Risk Factors" in our Annual Report on Form 10-K for the year ended January 1, 2023, subsequent reports on Form 10-Q, and elsewhere in this Quarterly Report.

The following list represents some, but not necessarily all, of the factors that could cause actual results to differ from historical results or those anticipated or predicted by these forward-looking statements:

•downward trends in our end markets and in economic conditions;

•reduced levels of residential new construction; residential repair, renovation and remodeling; and non-residential building construction activity due to increases in mortgage rates, changes in mortgage interest deductions and related tax changes and reduced availability of financing;

•competition;

•the continued success of, and our ability to maintain relationships with, certain key customers in light of customer concentration and consolidation;

•our ability to accurately anticipate demand for our products;

•impacts on our business from weather and climate change;

•our ability to successfully consummate and integrate acquisitions;

•changes in prices of raw materials and fuel;

•tariffs and evolving trade policy and friction between the United States and other countries, including China, and the impact of anti-dumping and countervailing duties;

•increases in labor costs, the availability of labor or labor relations (i.e., disruptions, strikes or work stoppages);

•our ability to manage our operations including potential disruptions, manufacturing realignments (including related restructuring charges) and customer credit risk;

•product liability claims and product recalls;

•our ability to generate sufficient cash flows to fund our capital expenditure requirements and to meet our debt service obligations, including our obligations under our senior notes, our term loan credit agreement (the "Term Loan Facility") and our asset-based revolving credit facility (the "ABL Facility");

•limitations on operating our business as a result of covenant restrictions under our existing and future indebtedness, including our senior notes, the Term Loan Facility and the ABL Facility;

•fluctuating foreign exchange and interest rates;

•the continuous operation of our information technology and enterprise resource planning systems and management of potential cyber security threats and attacks and data privacy requirements;

•political, economic and other risks that arise from operating a multinational business;

•retention of key management personnel;

•environmental and other government regulations, including the United States Foreign Corrupt Practices Act ("FCPA"), and any changes in such regulations;

•the scale and scope of public health issues and their impact on our operations, customer demand and supply chain; and

•our ability to replace our expiring patents and to innovate and keep pace with technological developments.

We caution you that the foregoing list of important factors is not all-inclusive. In addition, in light of these risks and uncertainties, the matters referred to in the forward-looking statements contained in this Quarterly Report may not in fact occur. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law.

ii

The Company may use its website and/or social media outlets, such as LinkedIn, as distribution channels of material Company information. Financial and other important information regarding the Company is routinely posted on and accessible through the Company’s website at http://investor.masonite.com and its LinkedIn page at https://www.linkedin.com/company/masonitedoors/mycompany/. In addition, you may automatically receive email alerts and other information about the Company when you enroll your email address by visiting the “Email Alerts” section at http://investor.masonite.com.

iii

PART I – FINANCIAL INFORMATION

Item 1. Unaudited Financial Statements

MASONITE INTERNATIONAL CORPORATION

Condensed Consolidated Statements of Income and Comprehensive Income

(In thousands of U.S. dollars, except per share amounts)

(Unaudited)

	Three Months Ended
	April 2, 2023		April 3, 2022
Net sales	$	725,984	$	726,217
Cost of goods sold	555,493		541,968
Gross profit	170,491		184,249
Selling, general and administration expenses	101,705		83,246
Restructuring costs (benefit)	3,678		(19)
Operating income	65,108		101,022
Interest expense, net	14,252		10,239
Other expense (income), net	52		(1,415)
Income before income tax expense	50,804		92,198
Income tax expense	11,360		23,477
Net income	39,444		68,721
Less: net income attributable to non-controlling interests	953		1,139
Net income attributable to Masonite	$	38,491	$	67,582
Basic earnings per common share attributable to Masonite	$	1.74	$	2.93
Diluted earnings per common share attributable to Masonite	$	1.71	$	2.89
Comprehensive income:
Net income	$	39,444	$	68,721
Other comprehensive income (loss):
Foreign currency translation gain (loss)	8,949		(2,105)
Amortization of actuarial net losses	191		6
Income tax (expense) benefit related to other comprehensive income (loss)	(45)		10
Other comprehensive income (loss), net of tax:	9,095		(2,089)
Comprehensive income	48,539		66,632
Less: comprehensive income attributable to non-controlling interests	945		1,281
Comprehensive income attributable to Masonite	$	47,594	$	65,351

See accompanying notes to the condensed consolidated financial statements.

1

MASONITE INTERNATIONAL CORPORATION

Condensed Consolidated Balance Sheets

(In thousands of U.S. dollars, except share amounts)

(Unaudited)

ASSETS	April 2, 2023		January 1, 2023
Current assets:
Cash and cash equivalents	$	210,725	$	296,922
Restricted cash	11,587		11,999
Accounts receivable, net	391,559		375,918
Inventories, net	418,581		406,828
Prepaid expenses and other assets	52,280		55,051
Income taxes receivable	18,433		16,922
Total current assets	1,103,165		1,163,640
Property, plant and equipment, net	714,259		652,329
Operating lease right-of-use assets	165,869		160,695
Investment in equity investees	19,924		16,111
Goodwill	257,977		69,868
Intangible assets, net	266,658		136,056
Deferred income taxes	19,156		16,133
Other assets	34,049		33,346
Total assets	$	2,581,057	$	2,248,178
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$	123,768	$	111,526
Accrued expenses	193,642		223,046
Income taxes payable	8,329		14,361
Total current liabilities	325,739		348,933
Long-term debt	1,113,880		866,116
Long-term operating lease liabilities	155,993		151,242
Deferred income taxes	128,292		79,590
Other liabilities	76,429		59,515
Total liabilities	1,800,333		1,505,396
Commitments and Contingencies (Note 7)
Equity:
Share capital: unlimited shares authorized, no par value, 22,138,282 and 22,155,035 shares issued and outstanding as of April 2, 2023, and January 1, 2023, respectively	529,156		520,003
Additional paid-in capital	218,010		226,514
Retained earnings	155,625		127,826
Accumulated other comprehensive loss	(133,121)		(142,224)
Total equity attributable to Masonite	769,670		732,119
Equity attributable to non-controlling interests	11,054		10,663
Total equity	780,724		742,782
Total liabilities and equity	$	2,581,057	$	2,248,178

See accompanying notes to the condensed consolidated financial statements.

2

MASONITE INTERNATIONAL CORPORATION

Condensed Consolidated Statements of Changes in Equity

(In thousands of U.S. dollars, except share amounts)

(Unaudited)

	Three Months Ended
	April 2, 2023		April 3, 2022
Total equity, beginning of period	$	742,782	$	699,778
Share capital:
Beginning of period	520,003		543,400
Common shares issued for delivery of share based awards	12,372		11,630
Common shares issued under employee stock purchase plan	806		797
Common shares repurchased	(4,025)		(28,441)
End of period	529,156		527,386
Additional paid-in capital:
Beginning of period	226,514		222,177
Share based compensation expense	6,054		4,719
Common shares issued for delivery of share based awards	(12,372)		(11,630)
Common shares withheld to cover income taxes payable due to delivery of share based awards	(1,960)		(2,963)
Common shares issued under employee stock purchase plan	(226)		(134)
Common shares repurchased	—		(17,710)
End of period	218,010		194,459
Retained earnings (deficit):
Beginning of period	127,826		24,244
Net income attributable to Masonite	38,491		67,582
Common shares repurchased	(10,692)		(93,849)
End of period	155,625		(2,023)
Accumulated other comprehensive loss:
Beginning of period	(142,224)		(101,582)
Other comprehensive income (loss) attributable to Masonite, net of tax	9,103		(3,228)
End of period	(133,121)		(104,810)
Equity attributable to non-controlling interests:
Beginning of period	10,663		11,539
Net income attributable to non-controlling interests	953		1,139
Other comprehensive (loss) income attributable to non-controlling interests, net of tax	(8)		142
Dividends to non-controlling interests	(554)		(1,385)
End of period	11,054		11,435
Total equity, end of period	$	780,724	$	626,447
Common shares outstanding:
Beginning of period	22,155,035		23,623,887
Common shares issued for delivery of share based awards	142,943		169,370
Common shares issued under employee stock purchase plan	8,827		8,029
Common shares repurchased	(168,523)		(1,236,330)
End of period	22,138,282		22,564,956

See accompanying notes to the condensed consolidated financial statements.

3

MASONITE INTERNATIONAL CORPORATION

Condensed Consolidated Statements of Cash Flows

(In thousands of U.S. dollars)

(Unaudited)

	Three Months Ended
Cash flows from operating activities:	April 2, 2023		April 3, 2022
Net income	$	39,444	$	68,721
Adjustments to reconcile net income to net cash flow provided by (used in) operating activities:
Depreciation	21,485		17,272
Amortization	7,421		4,612
Share based compensation expense	6,054		4,719
Deferred income taxes	885		7,027
Unrealized foreign exchange (gain) loss	(97)		594
Share of income from equity investees, net of tax	(748)		(1,687)
Pension and post-retirement funding, net of expense	(509)		(114)
Non-cash accruals and interest	1,445		(304)
Loss (gain) on sale of property, plant and equipment	1,038		(2,854)
Changes in assets and liabilities, net of acquisitions:
Accounts receivable	(5,457)		(64,948)
Inventories	34,024		(58,106)
Prepaid expenses and other assets	(7,730)		(387)
Accounts payable and accrued expenses	(33,223)		(11,294)
Other assets and liabilities	(7,685)		(1,100)
Net cash flow provided by (used in) operating activities	56,347		(37,849)
Cash flows from investing activities:
Additions to property, plant and equipment	(27,827)		(19,095)
Acquisition of businesses, net of cash acquired	(353,618)		—
Proceeds from sale of property, plant and equipment	4		6,393
Proceeds from repayment of note receivable	12,000		—
Other investing activities	(3,511)		(588)
Net cash flow used in investing activities	(372,952)		(13,290)
Cash flows from financing activities:
Proceeds from issuance of long-term debt	250,000		—
Payment of debt issuance costs	(3,628)		—
Proceeds from borrowings on revolving credit facilities	100,000		—
Repayments of borrowings on revolving credit facilities	(100,000)		—
Tax withholding on share based awards	(1,960)		(2,963)
Distributions to non-controlling interests	(554)		(1,385)
Repurchases of common shares	(14,717)		(140,000)
Net cash flow provided by (used in) financing activities	229,141		(144,348)
Net foreign currency translation adjustment on cash	855		(1,394)
Decrease in cash, cash equivalents and restricted cash	(86,609)		(196,881)
Cash, cash equivalents and restricted cash, beginning of period	308,921		391,505
Cash, cash equivalents and restricted cash, at end of period	$	222,312	$	194,624

See accompanying notes to the condensed consolidated financial statements.

4

MASONITE INTERNATIONAL CORPORATION

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. Business Overview and Significant Accounting Policies

Unless we state otherwise or the context otherwise requires, references to "Masonite," "we," "our," "us" and the "Company" in these notes to the condensed consolidated financial statements refer to Masonite International Corporation and its subsidiaries.

Description of Business

Masonite International Corporation is one of the largest manufacturers of doors in the world, with significant market share in both interior and exterior door products. Masonite operates 63 manufacturing locations in seven countries and sells doors to customers throughout the world with our largest markets being the United States, Canada and the United Kingdom.

Basis of Presentation

We prepare these unaudited condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States of America ("GAAP") and applicable rules and regulations of the U.S. Securities and Exchange Commission ("SEC") regarding interim financial reporting. Accordingly, they do not include all of the information and notes required by GAAP for annual financial statements. In the opinion of management, all adjustments consisting of normal and recurring entries considered necessary for a fair presentation of the results for the interim periods presented have been included. All significant intercompany balances and transactions have been eliminated. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect reported amounts in the financial statements and accompanying notes. These estimates are based on information available as of the date of the unaudited condensed consolidated financial statements; therefore, actual results could differ from those estimates. Interim results are not necessarily indicative of the results for a full year.

These unaudited condensed consolidated financial statements should be read in conjunction with the Company's Annual Report on Form 10-K for the fiscal year ended January 1, 2023, as filed with the SEC (the "Annual Report"). Our fiscal year is the 52- or 53-week period ending on the Sunday closest to December 31. In a 52-week year, each fiscal quarter consists of 13 weeks. For ease of disclosure, the 13-week periods are referred to as three-month periods and the 52- or 53-week periods are referred to as a year.

Changes in Accounting Standards and Policies

There have been no changes in the significant accounting policies from those that were disclosed in the fiscal year 2022 audited consolidated financial statements, other than as noted below.

Adoption of Recent Accounting Pronouncements

In December 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2021-10, "Government Assistance," which requires annual disclosures that increase the transparency of transactions involving government grants, including (1) the types of transactions, (2) the accounting for those transactions and (3) the effect of those transactions on an entity's financial statements. The guidance is effective for annual periods beginning after December 15, 2021, with early adoption permitted. We adopted the new guidance as of January 3, 2022, the beginning of fiscal year 2022, and the adoption did not have a material impact on our financial statements.

In October 2021, the FASB issued ASU 2021-08, "Accounting for Contract Assets and Contract Liabilities from Contracts with Customers," which clarifies that an acquirer of a business should recognize and measure contract assets and contract liabilities in a business combination in accordance with ASU 2014-09, "Revenue from Contracts with Customers" as if the entity had originated the contracts. We adopted the new guidance as of January 1, 2023, the beginning of fiscal year 2023, and the adoption did not have a material impact on our financial statements.

5

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

2. Acquisitions and Divestitures

Acquisitions

On January 3, 2023, we completed the acquisition of 100% of the outstanding equity of EPI Holdings, Inc. ("Endura"), for total consideration of approximately $408.1 million, including an $18.0 million holdback which is payable 24 months after the acquisition date. Endura is a leading innovator and manufacturer of high-performance door frames and door system components in the United States. Endura’s product offerings include engineered frames, self-adjusting sill systems, weather sealing, multi-point locks and installation accessories used by builders and contractors in residential new construction as well as repair and remodeling applications. The acquisition is intended to accelerate our Doors That Do MoreTM strategy and maximize our growth potential. The $189.9 million excess purchase price over the fair value of tangible and intangible assets acquired was allocated to goodwill. The goodwill principally represents anticipated synergies to be gained from the integration into our existing business and acquisition of the assembled workforce. This goodwill is not deductible for tax purposes and relates to the North American Residential segment.

The Company has accounted for the acquisition as a business combination and allocated the preliminary estimated purchase price to the estimated fair values of assets acquired and liabilities assumed utilizing various valuation methods including replacement cost, market values and the income approach. The Company has not yet completed its evaluation and determination of certain assets acquired and liabilities assumed, primarily (i) the final valuation of intangible assets related to customers relationships and trade names, and (ii) the final assessment and valuation of certain other assets acquired and liabilities assumed, including inventory, property, plant and equipment, leases, and deferred income taxes, which could also impact goodwill during the measurement period.

The allocation of the purchase price to assets acquired and liabilities assumed is as follows:

(In thousands)	Endura
Cash acquired	$	32,501
Accounts receivable, net	7,871
Inventories, net	44,183
Property, plant and equipment, net	54,373
Goodwill	189,938
Intangible assets	135,800
Accounts payable and accrued expenses	(15,088)
Deferred income taxes	(44,345)
Other assets and liabilities, net	2,868
Total purchase price	$	408,101

The fair values of intangible assets acquired are based on management's estimates and assumptions including the income approach, the cost approach and the market approach. The intangible assets acquired are not expected to have any residual value. The gross contractual value of acquired trade receivables was $8.3 million.

6

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

Intangible assets acquired from the Endura acquisition consist of the following:

	Fair Value  (in thousands)		Expected Useful Life (Years)
Customer relationships	$	116,000	10
Trademarks and trade names	6,600		10
Patents	13,200		12
Total intangible assets acquired	$	135,800

Endura's results of operations were included in the condensed consolidated statements of income and comprehensive income for the period subsequent to the acquisition date. For the three months ended April 2, 2023, Endura had $59.8 million in net sales and $4.5 million in net loss attributable to Masonite.

Pro Forma Information

The following unaudited pro forma financial information represents the consolidated financial information as if the Endura acquisition had been included in our consolidated results beginning on January 2, 2022, the first day of the fiscal year prior to the respective acquisition date. The pro forma results have been calculated after adjusting the results of the acquired entities to remove intercompany transactions and to reflect the additional depreciation, amortization and interest expense that would have been charged assuming the fair value adjustments to property, plant and equipment and intangible assets and the additional debt incurred to fund the acquisition had been applied on the first day of the fiscal year prior to the respective acquisition, together with the consequential tax effects. The pro forma results do not reflect any cost savings, operating synergies or revenue enhancements that the combined company may achieve as a result of the acquisitions; the costs to combine the companies' operations; or the costs necessary to achieve these costs savings, operating synergies and revenue enhancements. As a result, the pro forma information below does not purport to present what actual results would have been had the acquisition been consummated on the date indicated and it is not necessarily indicative of future results of operations.

	Three Months Ended April 3, 2022
(In thousands)	Masonite		Endura		Pro Forma Adjustments		Pro Forma
Net sales	$	726,217	$	72,716	$	(2,604)	$	796,329
Net income attributable to Masonite	67,582		3,353		(5,881)		65,054
Basic earnings per common share	$	2.93					$	2.82
Diluted earnings per common share	$	2.89					$	2.78

3. Accounts Receivable

Our customers consist mainly of retailers, distributors and contractors. Our ten largest customers accounted for 59.3% and 62.3% of total accounts receivable as of April 2, 2023, and January 1, 2023, respectively. Our largest customer, The Home Depot, Inc., accounted for more than 10% of the consolidated gross accounts receivable balance as of April 2, 2023, and January 1, 2023. The allowance for doubtful accounts balance was $2.9 million and $2.5 million as of April 2, 2023, and January 1, 2023, respectively.

We maintain an accounts receivable sales program with a third party (the "AR Sales Program"). Under the AR Sales Program, we can transfer ownership of eligible trade accounts receivable of certain customers. Receivables are sold outright to a third party who assumes the full risk of collection, without recourse to us in the event of a loss. Transfers of receivables under this program are accounted for as sales. Proceeds from the transfers reflect the face value of the accounts receivable less a discount. Receivables sold under the AR Sales Program are excluded from trade accounts receivable in the condensed consolidated balance sheets and are included in cash flows from operating activities in the condensed consolidated statements of cash flows. The discounts on the sales of trade accounts receivable sold, if any,

7

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

under the AR Sales Program were not material for any of the periods presented and were recorded in selling, general and administration expenses within the condensed consolidated statements of income and comprehensive income.

In most countries we pay and collect Value Added Tax ("VAT") when procuring goods and services within the normal course of business. VAT receivables are established in jurisdictions where VAT paid exceeds VAT collected and are recoverable through the filing of refund claims.

Certain wood moldings and millwork products being imported into the U.S. are subject to import tariffs. Tariff deposits are paid to the government and are recoverable through an assessment process.

4. Inventories

The amounts of inventory on hand were as follows as of the dates indicated:

(In thousands)	April 2, 2023		January 1, 2023
Raw materials	$	288,385	$	320,553
Finished goods	143,322		95,005
Provision for obsolete or aged inventory	(13,126)		(8,730)
Inventories, net	$	418,581	$	406,828

5. Accrued Expenses

The details of our accrued expenses were as follows as of the dates indicated:

(In thousands)	April 2, 2023		January 1, 2023
Accrued payroll	$	57,084	$	69,224
Accrued rebates	49,410		50,200
Current portion of operating lease liabilities	24,492		24,372
Accrued interest	8,142		16,480
Other accruals	54,514		62,770
Total accrued expenses	$	193,642	$	223,046

6. Long-Term Debt

(In thousands)	April 2, 2023		January 1, 2023
Senior unsecured notes, interest rate of 3.50%, due 2030	$	375,000	$	375,000
Senior unsecured notes, interest rate of 5.375%, due 2028	500,000		500,000
Term Loan Facility, interest rate of SOFR plus 2.25%, due 2027	250,000		—
Debt issuance costs	(11,120)		(8,884)
Total long-term debt	$	1,113,880	$	866,116

Interest expense related to our consolidated indebtedness under our senior unsecured notes, Term Loan Facility and ABL Facility was $15.4 million and $10.3 million for the three months ended April 2, 2023 and April 3, 2022, respectively.

3.50% Senior Notes due 2030

On July 26, 2021, we issued $375.0 million aggregate principal senior unsecured notes (the "2030 Notes"). The 2030 Notes bear interest at 3.50% per annum, payable in cash semiannually in arrears on February 15 and August 15 of each year and are due February 15, 2030. The 2030 Notes were issued at par.

Information concerning obligations under the 2030 Notes and the indenture governing them are described in detail in our Annual Report. As of April 2, 2023, we were in compliance with all covenants under the indenture governing the 2030 Notes.

8

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

5.375% Senior Notes due 2028

On July 25, 2019, we issued $500.0 million aggregate principal senior unsecured notes (the "2028 Notes"). The 2028 Notes bear interest at 5.375%, payable in cash semiannually in arrears on February 1 and August 1 of each year and are due February 1, 2028. The 2028 Notes were issued at par.

Information concerning obligations under the 2028 Notes and the indenture governing them are described in detail in our Annual Report. As of April 2, 2023, we were in compliance with all covenants under the indenture governing the 2028 Notes.

Term Loan Facility

On December 13, 2022, we and certain of our subsidiaries entered into a new delayed-draw term loan credit agreement (the "Term Loan Credit Agreement") maturing on December 12, 2027 (the "Term Loan Maturity Date"). The Term Loan Credit Agreement provides for a senior secured five-year delayed-draw term loan facility of $250.0 million (the "Term Loan Facility"). Loans under the Term Loan Facility (the "Term Loans") will bear interest at a rate equal to, at our option, (1) the Adjusted Term SOFR Rate (as defined in the Term Loan Credit Agreement) plus an applicable margin of 2.25% or (2) an alternate base rate equal to the greatest of (i) the "Prime Rate" in the U.S. last quoted by The Wall Street Journal, (ii) 0.50% above the greater of the federal funds rate and the rate comprised of both overnight federal funds and overnight eurodollar transactions denominated in U.S. dollars, (iii) 1.00% above the Adjusted Term SOFR Rate for a one month interest period and (iv) 1.00%, plus, in each case, an applicable margin of 1.25%, subject to, in each of cases (1) and (2), an agreed interest rate floor. The Term Loans are repayable in equal quarterly installments for an annual aggregate amortization payment equal to 15% of the aggregate principal amount of the Term Loans, with the balance of the principal being due on the Term Loan Maturity Date.

The Term Loan Credit Agreement also includes a quarterly ticking fee of 25 basis points per annum payable to the lenders under the Term Loan Facility beginning on January 3, 2023 (the "Closing Date") in respect of the unutilized commitments thereunder. As a result of the incurrence of the Term Loans on the Closing Date such ticking fees were not (and shall not be) payable to the Lenders.

The Borrower also pays customary agency fees.

Obligations under the Term Loan Credit Agreement are fully and unconditionally guaranteed, jointly and severally, by us and by certain of our directly or indirectly wholly-owned subsidiaries organized in the United States and are secured by the equity in, and substantially all the assets of, such subsidiaries. The Term Loans were funded in an amount of $250.0 million and applied to finance a portion of the consideration payable in connection with the consummation of the Endura acquisition on January 3, 2023. We received net proceeds of $246.4 million after deducting $3.6 million of debt issuance costs. The debt issuance costs were capitalized as a reduction to the carrying value of debt and are being accreted to interest expense over the term of the loan using the effective interest method.

The Term Loan Credit Agreement contains various customary representations, warranties by us and covenants that are described in detail in our Annual Report. As of April 2, 2023, we were in compliance with all covenants under the indenture governing the Term Loan Credit Agreement.

ABL Facility

On January 31, 2019, we and certain of our subsidiaries entered into a $250.0 million asset-based revolving credit facility (the "ABL Facility") maturing on January 31, 2024, which replaced the previous facility. On October 28, 2022, we and certain of our subsidiaries entered into an amendment which, among other things, (i) increased the revolving credit commitments available thereunder by $100.0 million to an aggregate amount of $350.0 million and (ii) replaced the LIBOR-based interest rate applicable to borrowings thereunder in U.S. dollars with an interest rate based on the sum of (x) a "Term SOFR" rate published by the CME Group Benchmark Administration Limited (CBA) plus (y) 10 basis points ("Adjusted Term SOFR"). Additionally, on December 12, 2022, we entered into an amendment to the ABL Facility, which, among other things, extended the maturity of the ABL Facility from January 31, 2024 to December 12, 2027. The terms of the ABL Facility remained otherwise substantially unchanged and are described in detail in our Annual Report. On January 3, 2023, we borrowed $100.0 million under our ABL Facility in order to fund a portion of

9

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

the cash consideration paid for the acquisition of Endura. During the first quarter of 2023, we repaid all amounts outstanding under the ABL Facility.

The ABL Facility contains various customary representations, warranties by us and covenants that are described in detail in our Annual Report. As of April 2, 2023, we were in compliance with all covenants under the credit agreement governing the ABL Facility. We had availability of $313.4 million under our ABL Facility and there were no amounts outstanding as of April 2, 2023.

7. Commitments and Contingencies

We may become involved from time-to-time in litigation and regulatory compliance matters incidental to our business, including employment and wage and hour claims, antitrust, tax, product liability, environmental, health and safety, commercial disputes, intellectual property, contracts and other matters arising out of the normal conduct of our business. Since litigation is inherently unpredictable and unfavorable resolutions can occur, assessing contingencies is highly subjective and requires judgments about future events. We regularly review and accrue for contingencies related to litigation and regulatory compliance matters, if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Based on current information, in the opinion of management, the ultimate resolution of these matters, individually or in the aggregate, will not have a material adverse effect on our financial condition, results of operations or cash flows.

Antitrust Class Action Proceedings - Canada

On May 19, 2020, an intended class proceeding was commenced in the Province of Québec, Canada naming as defendants Masonite Corporation, Corporation Internationale Masonite, JELD-WEN, Inc., JELD-WEN Holding, Inc. and JELD-WEN of Canada, Ltd. The plaintiff alleges that the Masonite and JELD-WEN defendants engaged in anticompetitive conduct, including price-fixing involving interior molded doors. The intended class proceeding seeks damages, punitive damages, and other relief. On December 22, 2020, the parties filed a motion with the court seeking to stay the proceeding.

On October 2, 2020, an intended class proceeding was commenced in the Federal Court of Canada naming as defendants Masonite International Corporation, Masonite Corporation, JELD-WEN, Inc., JELD-WEN Holding, Inc. and JELD-WEN of Canada, Ltd. The plaintiff alleges that the Masonite and JELD-WEN defendants engaged in anticompetitive conduct, including price-fixing involving interior molded doors. The intended class proceeding seeks damages, punitive damages, and other relief. The plaintiff served its certification record on March 31, 2021. The Federal Court has scheduled a hearing on certification for October 12-13, 2023.

As of April 2, 2023, we have not accrued an expense in connection with this matter because, although an adverse outcome is reasonably possible, the amount or range of any potential loss cannot be reasonably estimated. This proceeding is at an early stage. While we intend to defend against these claims vigorously, there can be no assurance that the ultimate resolution of this litigation will not have a material, adverse effect on our consolidated financial condition, results of operations or cash flow.

8. Share Based Compensation Plans

Share based compensation expense was $6.1 million and $4.7 million for the three months ended April 2, 2023 and April 3, 2022, respectively. As of April 2, 2023, the total remaining unrecognized compensation expense related to share based compensation amounted to $47.0 million, which will be amortized over the weighted average remaining requisite service period of 2.1 years.

Equity Incentive Plans

Our equity incentive plans under the 2021 Equity Plan and 2012 Plan are described in detail and defined in our Annual Report. The aggregate number of common shares that can be issued with respect to equity awards under the 2021 Equity Plan cannot exceed 880,000 shares; plus the number of shares reserved for the 2012 Plan that is in excess of the number of shares related to outstanding grants; plus the number of shares subject to existing grants under the 2012 Plan that may expire or be forfeited or cancelled. As of April 2, 2023, there were 583,445 shares of common stock available for future issuance under the 2021 Equity Plan.

10

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

Deferred Compensation Plan

We offer to certain of our employees and directors a Deferred Compensation Plan, which is further described and defined in our Annual Report. As of April 2, 2023, the liability and asset relating to deferred compensation had a fair value of $7.1 million and $7.0 million, respectively. As of April 2, 2023, participation in the deferred compensation plan is limited and no restricted stock awards have been deferred into the deferred compensation plan. All plan investments are categorized as having Level 1 valuation inputs as established by the FASB’s Fair Value Framework.

Stock Appreciation Rights

We have granted Stock Appreciation Rights ("SARs") to certain employees, which entitle the recipient to the appreciation in value of granted common shares over the exercise price over a period of time, each as specified in the applicable award agreement. The exercise price of any SAR granted may not be less than the fair market value of our common shares on the date of grant. The compensation expense for the SARs is measured based on the fair value of the SARs at the date of grant and is recognized over the requisite service period. The SARs vest over a maximum of three years, have a life of ten years and settle in common shares. It is assumed that all time-based SARs will vest. We recognize forfeitures of SARs in the period in which they occur.

The total fair value of SARs vested was $0.7 million during the three months ended April 2, 2023.

Three Months Ended April 2, 2023	Stock Appreciation Rights	Aggregate Intrinsic Value (in thousands)		Weighted Average Exercise Price		Average Remaining Contractual Life (Years)
Outstanding, beginning of period	184,205	$	2,153	$	74.75	7.0
Granted	30,946			88.99
Exercised	—	—		—
Cancelled and forfeited	—			—
Outstanding, end of period	215,151	$	3,420	$	76.79	7.2
Exercisable, end of period	152,717	$	3,309	$	70.89	6.4

The value of SARs granted is determined using the Black-Scholes-Merton valuation model, and the corresponding expense is expected to be recognized over the average requisite service period of 2.0 years. Expected volatility is based upon the historical volatility of our common shares amongst other considerations. The expected term is calculated based upon historical employee exercise behavior and the contractual term of the SAR amongst other considerations. The weighted average grant date assumptions used for the SARs granted were as follows for the periods indicated:

	2023 Grants
SAR value (model conclusion)	$	32.63
Risk-free rate	4.1		%
Expected dividend yield	0.0		%
Expected volatility	28.4		%
Expected term (years)	6.0

Restricted Stock Units

We have granted Restricted Stock Units ("RSUs") to directors and certain employees under the 2021 Equity Plan and the 2012 Plan. The RSUs confer the right to receive shares of our common stock at a specified future date or when certain conditions are met. The compensation expense for the RSUs granted is based on the fair value of the RSUs at the date of grant, which is equal to the stock price on the date of grant, and is recognized over the requisite service period. The RSUs vest over a maximum of three years and call for the underlying shares to be delivered no later than 30 days following the vesting date unless the participant is subject to a blackout period. In such case, the shares are to be

11

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

delivered once the blackout restriction has been lifted. It is assumed that all time-based RSUs will vest. We recognize forfeitures of RSUs in the period in which they occur.

Three Months Ended April 2, 2023	Total Restricted Stock Units Outstanding	Weighted Average Grant Date Fair Value
Outstanding, beginning of period	313,753	$	92.85
Granted	192,847	89.15
Delivered	(79,511)	92.31
Withheld to cover (1)	(17,434)
Forfeited	(17,131)	90.13
Outstanding, end of period	392,524	$	91.28

___________

(1) A portion of the vested RSUs delivered were net shares settled to cover statutory requirements for income and other employment taxes. We remit the equivalent cash to the appropriate taxing authorities. These net share settlements had the effect of share repurchases by us as we reduced and retired the number of shares that would have otherwise been issued as a result of the vesting.

RSUs granted during the three months ended April 2, 2023, vest at specified future dates with only service requirements. The value of RSUs granted in the three months ended April 2, 2023, was $17.2 million and is being recognized over the weighted average requisite service period of 2.0 years. During the three months ended April 2, 2023, 96,945 RSUs vested at a fair value of $8.9 million.

Performance-based Restricted Stock Units

We have granted certain Performance-based Restricted Stock Units ("PRSUs") under the 2021 Equity Plan and the 2012 Plan. These PRSUs are settled with payouts ranging from zero to 200% of the target award value depending on performance goal achievement. The compensation expense for the PRSUs awarded is based on the fair value of the PRSUs at the date of grant, which is equal to the stock price on the date of grant, and is recognized over the requisite service period. The compensation expense for certain PRSUs is determined using the Monte Carlo simulation method. The PRSUs vest over a maximum of three years and call for the underlying shares to be delivered no later than 30 days following the vesting date unless the participant is subject to a blackout period. In such case, the shares are to be delivered once the blackout restriction has been lifted.

Three Months Ended April 2, 2023	Total Performance Restricted Stock Units Outstanding	Weighted Average Grant Date Fair Value
Outstanding, beginning of period	310,678	$	90.15
Granted	91,631	104.24
Performance adjustment (1)	17,139	79.25
Delivered	(63,432)	79.25
Withheld to cover (2)	(5,224)
Forfeited	(3,782)	94.72
Outstanding, end of period	347,010	$	95.44

___________

(1) PRSUs are presented as outstanding, granted and forfeited in the table above assuming targets are met and the awards pay out at 100%. Certain awards are settled with payouts ranging from zero to 200% of the target award value depending on achievement. The performance adjustment represents the difference in shares ultimately awarded due to performance attainment above or below target.

(2) A portion of the vested PRSUs delivered were net shares settled to cover statutory requirements for income and other employment taxes. We remit the equivalent cash to the appropriate taxing authorities. These net share settlements had the effect of share repurchases by us as we reduced and retired the number of shares that would have otherwise been issued as a result of the vesting.

12

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

PRSUs granted during the three months ended April 2, 2023, vest at specified future dates based on both performance and service requirements. The value of PRSUs granted in the three months ended April 2, 2023, was $9.6 million and is being recognized over the weighted average requisite service period of 3.0 years. During the three months ended April 2, 2023, 68,656 PRSUs vested at a fair value of $5.4 million.

9. Restructuring Costs

In December 2022, we began implementing a plan intended to improve overall business performance that includes the optimization of our manufacturing capacity and reduction of our overhead and selling, general and administration workforce primarily in our North American Residential reportable segment as well as actions in the Architectural reportable segment and in our head offices (collectively, the "2022 Plan"). The optimization of our manufacturing capacity involves specific plants in the North American Residential segment and costs associated with the closure of these plants and related headcount reductions. Costs associated with the 2022 Plan include severance and closure charges which continue throughout 2023. As of April 2, 2023, we expect to incur approximately $9 million to $14 million of additional charges related to the 2022 Plan.

The following tables summarize the restructuring (benefit) costs recorded for the periods indicated:

	Three Months Ended April 2, 2023
(In thousands)	North American Residential		Architectural		Corporate & Other		Total
2022 Plan	$	2,380	$	684	$	614	$	3,678
Total Restructuring Costs	$	2,380	$	684	$	614	$	3,678

	Three Months Ended April 3, 2022
(In thousands)	North American Residential		Architectural		Corporate & Other		Total
Other	$	(91)	$	47	$	25	$	(19)
Total Restructuring (Benefit) Costs	$	(91)	$	47	$	25	$	(19)

	Cumulative Amount Incurred Through April 2, 2023
(In thousands)	North American Residential		Europe		Architectural		Corporate & Other		Total
2022 Plan	$	4,511	$	—	$	684	$	614	$	5,809
Total Restructuring Costs	$	4,511	$	—	$	684	$	614	$	5,809

The changes in the accrual for restructuring by activity were as follows for the periods indicated:

(In thousands)	January 1, 2023		Severance		Closure Costs		Cash Payments		April 2, 2023
2022 Plan	$	—	$	3,583	$	95	$	(2,897)	$	781
Total	$	—	$	3,583	$	95	$	(2,897)	$	781

10. Income Taxes

The effective tax rate differs from the Canadian statutory rate of 26.13% primarily due to mix of earnings in foreign jurisdictions that are subject to tax rates which differ from the Canadian statutory rate. In addition, we recognized zero income tax benefit due to the exercise and delivery of share based awards during the three months ended April 2, 2023, compared to $1.1 million of income tax benefit during the three months ended April 3, 2022.

13

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

On August 16, 2022, President Biden signed the Inflation Reduction Act of 2022 ("IRA") into law. The IRA includes several changes to existing tax law, including a minimum tax on adjusted financial statement income of applicable corporations and an excise tax on certain corporate stock buybacks. The tax provisions included in the IRA were generally effective beginning January 1, 2023, and no significant impact to the consolidated financial statements resulted from their adoption as of April 2, 2023.

11. Earnings Per Share

Basic earnings per share ("EPS") is calculated by dividing earnings attributable to Masonite by the weighted average number of our common shares outstanding during the period. Diluted EPS is calculated by dividing earnings attributable to Masonite by the weighted average number of common shares plus the incremental number of shares issuable from non-vested and vested RSUs and SARs outstanding during the period.

(In thousands, except share and per share information)	Three Months Ended
	April 2, 2023		April 3, 2022
Net income attributable to Masonite	$	38,491	$	67,582
Shares used in computing basic earnings per share	22,183,068		23,081,474
Effect of dilutive securities:
Incremental shares issuable under share compensation plans	297,165		296,880
Shares used in computing diluted earnings per share	22,480,233		23,378,354
Basic earnings per common share attributable to Masonite	$	1.74	$	2.93
Diluted earnings per common share attributable to Masonite	$	1.71	$	2.89
Anti-dilutive instruments excluded from diluted earnings per common share	191,385		72,954

The weighted average number of shares outstanding utilized for the diluted EPS calculation contemplates the exercise of all currently outstanding SARs and the conversion of all RSUs. The dilutive effect of such equity awards is calculated based on the weighted average share price for each fiscal period using the treasury stock method.

The Company's Board of Directors has approved five share repurchase authorizations, the most recent being an incremental $200.0 million share repurchase program approved on February 21, 2022. Under this program, the Company may repurchase shares from time to time, depending on market conditions and alternate uses of capital. The timing and actual number of shares repurchased will depend on a variety of factors, including price, general business and market conditions and alternate uses of capital. The share repurchase program may be effected through Rule 10b5-1 plans, open market purchases, each in compliance with Rule 10b-18 under the Exchange Act, or privately negotiated transactions. The program may be suspended or discontinued at any time and does not have an expiration date. In addition, the Company announced that its Board of Directors authorized it to enter into an accelerated share repurchase ("ASR") transaction as part of the new share repurchase program. The Company entered into an ASR transaction during the first quarter of 2022 with a third-party financial institution for the repurchase of $100.0 million of its outstanding common shares. At inception, pursuant to the agreement, the Company paid $100.0 million to the financial institution using cash on hand and received an initial delivery of 848,087 common shares on the same day. The final delivery of 319,678 common shares occurred in the second quarter. The $100.0 million ASR transaction was therefore completed in the second quarter of 2022 with a total delivery of 1,167,765 common shares at a volume-weighted average price ("VWAP") per share minus an agreed upon discount totaling $85.63 per share. The cash paid was reflected as a reduction of equity at the initial delivery of shares and the number of common shares outstanding were reduced at the dates of physical delivery.

14

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

12. Segment Information

Our reportable segments are organized and managed principally by end market: North American Residential, Europe and Architectural. The Corporate & Other category includes unallocated corporate costs and the results of immaterial operating segments which were not aggregated into any reportable segment. In addition to similar economic characteristics, we also consider the following factors in determining the reportable segments: the nature of business activities, the management structure directly accountable to our chief operating decision maker for operating and administrative activities, availability of discrete financial information and information presented to the Board of Directors and investors.

Our management reviews net sales and Adjusted EBITDA (as defined below) to evaluate segment performance and allocate resources. Net assets are not allocated to the reportable segments. Adjusted EBITDA is a non-GAAP financial measure which does not have a standardized meaning under GAAP and is unlikely to be comparable to similar measures used by other companies. Adjusted EBITDA should not be considered as an alternative to either net income or operating cash flows determined in accordance with GAAP. Adjusted EBITDA is defined as net income (loss) attributable to Masonite adjusted to exclude the following items:

•    depreciation;

•    amortization;

•    share based compensation expense;

•    loss (gain) on disposal of property, plant and equipment;

•    registration and listing fees;

•    restructuring costs (benefit);

•    asset impairment;

•    loss (gain) on disposal of subsidiaries;

•    interest expense (income), net;

•    loss on extinguishment of debt;

•    other expense (income), net;

•    income tax expense (benefit);

•    other items;

•    loss (income) from discontinued operations, net of tax; and

•    net income (loss) attributable to non-controlling interest.

This definition of Adjusted EBITDA differs from the definitions of EBITDA contained in the indentures governing the 2030 Notes and the 2028 Notes and the credit agreements governing the Term Loan Facility and the ABL Facility. Although Adjusted EBITDA is not a measure of financial condition or performance determined in accordance with GAAP, it is used to evaluate and compare the operating performance of our reportable segments and it is one of the primary measures used to determine employee incentive compensation. Intersegment sales are recorded using market prices.

Certain information with respect to reportable segments is as follows for the periods indicated:

	Three Months Ended April 2, 2023
(In thousands)	North American Residential		Europe		Architectural		Corporate & Other		Total
Net sales	$	569,429	$	63,716	$	92,861	$	5,349	$	731,355
Intersegment sales	(390)		(22)		(4,959)		—		(5,371)
Net sales to external customers	$	569,039	$	63,694	$	87,902	$	5,349	$	725,984
Adjusted EBITDA	$	107,881	$	5,151	$	5,350	$	(12,217)	$	106,165

15

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

	Three Months Ended April 3, 2022
(In thousands)	North American Residential		Europe		Architectural		Corporate & Other		Total
Net sales	$	569,429	$	81,839	$	74,659	$	6,196	$	732,123
Intersegment sales	(865)		(1,371)		(3,670)		—		(5,906)
Net sales to external customers	$	568,564	$	80,468	$	70,989	$	6,196	$	726,217
Adjusted EBITDA	$	127,667	$	11,843	$	(2,898)	$	(11,860)	$	124,752

A reconciliation of our net income attributable to Masonite to consolidated Adjusted EBITDA is set forth as follows for the periods indicated:

	Three Months Ended
(In thousands)	April 2, 2023		April 3, 2022
Net income attributable to Masonite	$	38,491	$	67,582
Plus:
Depreciation	21,485		17,272
Amortization	7,421		4,612
Share based compensation expense	6,054		4,719
Loss (gain) on disposal of property, plant and equipment	1,038		(2,854)
Restructuring costs (benefit)	3,678		(19)
Interest expense, net	14,252		10,239
Other (income) expense, net	52		(1,415)
Income tax expense	11,360		23,477
Other items (1)	1,381		—
Net income attributable to non-controlling interest	953		1,139
Adjusted EBITDA	$	106,165	$	124,752

(1) Other items include $1,381 in acquisition and due diligence related costs in the three months ended April 2, 2023, and were recorded in selling, general and administration expenses within the condensed consolidated statements of comprehensive income.

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NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

13. Accumulated Other Comprehensive Loss and Other Comprehensive Income (Loss)

A rollforward of the components of accumulated other comprehensive loss is as follows for the periods indicated:

	Three Months Ended
(In thousands)	April 2, 2023		April 3, 2022
Accumulated foreign currency translation losses, beginning of period	$	(132,001)	$	(96,919)
Foreign currency translation gain (loss)	8,949		(2,105)
Income tax expense (benefit) on foreign currency translation loss	—		11
Less: foreign currency translation (loss) gain attributable to non-controlling interest	(8)		1,139
Accumulated foreign currency translation losses, end of period	(123,044)		(100,152)
Accumulated pension and other post-retirement adjustments, beginning of period	(10,223)		(4,663)
Amortization of actuarial net losses	191		6
Income tax expense on amortization of actuarial net losses	(45)		(1)
Accumulated pension and other post-retirement adjustments	(10,077)		(4,658)
Accumulated other comprehensive loss	$	(133,121)	$	(104,810)
Other comprehensive gain (loss), net of tax	$	9,095	$	(2,089)
Less: other comprehensive (loss) income attributable to non-controlling interest	(8)		1,139
Other comprehensive income (loss) attributable to Masonite	$	9,103	$	(3,228)

Cumulative translation adjustments are reclassified out of accumulated other comprehensive loss into loss on disposal of subsidiaries in the condensed consolidated statements of income and comprehensive income. Actuarial net losses are reclassified out of accumulated other comprehensive loss into cost of goods sold in the condensed consolidated statements of income and comprehensive income.

Foreign currency translation gains as a result of translating our foreign assets and liabilities into U.S. dollars during the three months ended April 2, 2023, were $8.9 million. These foreign currency translation gains were primarily driven by strengthening of the Pound Sterling, the Mexican Peso and the Euro in comparison to the U.S. dollar during the period.

17

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

14. Supplemental Cash Flow Information

Certain cash and non-cash transactions were as follows for the periods indicated:

	Three Months Ended
(In thousands)	April 2, 2023		April 3, 2022
Transactions involving cash:
Interest paid	$	23,872	$	20,341
Interest received	2,210		166
Income taxes paid	16,267		16,735
Income tax refunds	41		8
Cash paid for operating lease liabilities	9,095		8,372
Cash paid for finance lease liabilities	358		366
Non-cash transactions:
Right-of-use assets acquired under operating leases	11,374		1,434
Holdback of portion of Endura purchase payable	18,000		—

The following reconciles total cash, cash equivalents and restricted cash as of the dates indicated:

	April 2, 2023		January 1, 2023
Cash and cash equivalents	$	210,725	$	296,922
Restricted cash	11,587		11,999
Total cash, cash equivalents and restricted cash	$	222,312	$	308,921

Property, plant and equipment additions in accounts payable were $9.9 million and $10.4 million as of April 2, 2023, and January 1, 2023, respectively.

During the fourth quarter of 2018, we provided debt financing to a distribution company via an interest-bearing note that was scheduled to mature in 2028. The interest-bearing note receivable was carried at amortized cost, with the interest payable in kind at the election of the borrower. The note receivable balance was $12.6 million as of January 1, 2023, and was recorded in the consolidated balance sheets as a component of prepaid expenses and other assets. On January 26, 2023, the note receivable was redeemed and fully repaid.

15. Fair Value of Financial Instruments

The carrying amounts of our cash and cash equivalents, restricted cash, accounts receivable, income taxes receivable, accounts payable, accrued expenses and income taxes payable approximate fair value because of the short-term maturity of those instruments. The carrying amount of our Term Loan Facility approximates fair value as the interest rates are variable and reflective of market rates. The estimated fair values and carrying values of our long-term senior note debt instruments were as follows for the periods indicated:

	April 2, 2023				January 1, 2023
(In thousands)	Fair Value		Carrying Value		Fair Value		Carrying Value
3.50% senior unsecured notes due 2030	$	313,781	$	371,271	$	303,870	$	371,136
5.375% senior unsecured notes due 2028	$	478,530	$	496,053	$	462,495	$	495,868

These estimates are based on market quotes and calculations based on current market rates available to us and are categorized as having Level 2 valuation inputs as established by the FASB's Fair Value Framework. Market quotes used in these calculations are based on bid prices for our debt instruments and are obtained from and corroborated with multiple independent sources. The market quotes obtained from independent sources are within the range of management's expectations.

18

MASONITE INTERNATIONAL CORPORATION

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

The following Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is based upon accounting principles generally accepted in the United States of America and discusses the financial condition and results of operations for Masonite International Corporation for the three months ended April 2, 2023, and April 3, 2022. In this MD&A, "Masonite," "we," "us," "our" and the "Company" refer to Masonite International Corporation and its subsidiaries.

This discussion should be read in conjunction with (i) the unaudited condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q and (ii) the annual audited consolidated financial statements, including the accompanying notes and MD&A, which are included in our Annual Report on Form 10-K for the year ended January 1, 2023 (the "Annual Report"). The following discussion should also be read in conjunction with the disclosure under "Special Note Regarding Forward-Looking Statements" elsewhere in this Quarterly Report on Form 10-Q. Our actual results could differ materially from the forward-looking statements as a result of these risks and uncertainties.

Overview

We are a leading global designer, manufacturer, marketer and distributor of interior and exterior doors, door system components and door systems for the new construction and repair, renovation and remodeling sectors of the residential and non-residential building construction markets. Since 1925, we have provided our customers with innovative products and superior service at compelling values. Through innovative door solutions, a better door buying experience for our customers and partners and advanced manufacturing and service delivery, we deliver a commitment of Doors That Do MoreTM.

We market and sell our products to remodeling contractors, builders, homeowners, retailers, dealers, lumberyards, commercial and general contractors and architects through well-established wholesale, retail and direct distribution channels as part of our cross-merchandising strategy. Customers are provided a broad product offering of interior and exterior doors and entry systems at various price points. We manufacture an extensive range of interior and exterior doors in a wide array of designs, materials and sizes. Our interior doors are made with wood and related materials such as hardboard (including wood composite molded and flat door facings). Our exterior doors are made primarily of steel, fiberglass or composite materials. Our residential doors are molded panel, flush, stile and rail, steel or fiberglass.

We operate 63 manufacturing and distribution facilities in seven countries in North America, South America, Europe and Asia, which are strategically located to serve our customers through multiple distribution channels. These distribution channels include: (i) direct distribution to retail home center customers; (ii) one-step distribution that sells directly to homebuilders and contractors; and (iii) two-step distribution through wholesale distributors. For retail home center customers, numerous door fabrication facilities provide value-added fabrication and logistical services, including pre-finishing and store delivery of pre-hung interior and exterior doors. We believe our ability to provide: (i) a broad product range; (ii) frequent, rapid, on-time and complete delivery; (iii) consistency in products and merchandising; (iv) national service; and (v) special order programs enables retail customers to increase comparable store sales and helps to differentiate us from our competitors. We believe investments in innovative new product manufacturing and distribution capabilities, coupled with an ongoing commitment to operational excellence, provide a strong platform for future growth.

Our reportable segments are organized and managed principally by end market: North American Residential, Europe and Architectural. In the three months ended April 2, 2023, we generated net sales of $569.0 million or 78.4%, $63.7 million or 8.8% and $87.9 million or 12.1% in our North American Residential, Europe and Architectural segments, respectively.

During the first quarter, we experienced lower end market demand and continued negative impacts from macro-economic conditions such as rising interest rates and unfavorable consumer sentiment. Base volumes, excluding the acquisition of Endura on January 3, 2023, decreased in our North American Residential segment due to expected new housing softness and declines in the residential repair, renovation and remodeling channel, partially offset by increases in average unit price. Net sales, net income attributable to Masonite, Adjusted EBITDA and Adjusted EBITDA margin in our Europe segment declined as compared to the first quarter of 2022 due to the aforementioned macro-economic factors, while Adjusted EBITDA margins improved compared to the fourth quarter of 2022 due to operational improvements and price-cost management. Net sales growth in the Architectural segment was largely driven by increases

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in average unit price. The extent to which changes in interest rates, rising energy and fuel costs, and consumer sentiment impact our business, results of operations and financial condition will depend on future developments, which are highly uncertain and cannot be predicted.

Key Factors Affecting Our Results of Operations

Product Demand

There are numerous factors that influence overall market demand for our products. Demand for new homes, home improvement products and other building construction products have a direct impact on our financial condition and results of operations. Demand for our products may be impacted by changes in global economic conditions, including inflation, deflation, interest rates, availability of capital, supply chain constraints, consumer spending rates, energy availability and costs, and the effects of governmental initiatives to manage economic conditions. Additionally, trends in residential new construction, repair, renovation and remodeling and architectural building construction may directly impact our financial performance. Accordingly, the following factors may have a direct impact on our business in the countries and regions in which our products are sold:

•the strength of the economy;

•the amount and type of residential and commercial construction;

•housing sales and home values;

•the age of existing home stock, home vacancy rates and foreclosures;

•non-residential building occupancy rates;

•increases in the cost of raw materials or wages or any shortage in supplies or labor;

•the availability and cost of credit;

•employment rates and consumer confidence; and

•demographic factors such as immigration and migration of the population and trends in household formation.

Product Pricing and Mix

The building products industry is highly competitive, and we therefore face pressure on sales prices of our products. In addition, our competitors may adopt more aggressive sales policies and devote greater resources to the development, promotion and sale of their products than we do, which could result in a loss of customers. Our business in general is subject to changing consumer and industry trends, demands and preferences. Trends within the industry change often and our failure to anticipate, identify or quickly react to changes in these trends could lead to, among other things, rejection of a new product line and reduced demand and price reductions for our products, which could materially adversely affect us. Changes in consumer preferences may also lead to increased demand for our lower margin products relative to our higher margin products, which could reduce our future profitability.

Business Wins and Losses

Our customers consist mainly of wholesalers and retail home centers. Net sales from customers that represent a significant portion of our net sales in past periods, individually or as a group, may not continue in future periods, or if continued, may not reach or exceed historical levels in any period. Certain customers perform periodic product line reviews to assess their product offerings, which have, on past occasions, led to business wins and losses. In addition, as a result of competitive bidding processes, we may not be able to increase or maintain the margins at which we sell our products to our customers.

Organizational Restructuring

Over the past several years, we have engaged in a series of restructuring programs related to exiting certain geographies and non-core businesses, optimizing our manufacturing capacity, consolidating certain internal support functions and engaging in other actions designed to reduce our cost structure and improve productivity. These initiatives primarily consist of severance actions and lease termination costs. Management continues to evaluate our business; therefore, in future years, there may be additional provisions for new plan initiatives, as well as changes in previously recorded estimates, as payments are made, or actions are completed. Asset impairment charges were also incurred in

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connection with these restructuring actions for those assets sold, abandoned or made obsolete as a result of these programs.

In December 2022, we began implementing a plan intended to improve overall business performance that includes the optimization of our manufacturing capacity and reduction of our overhead and selling, general and administration workforce primarily in our North American Residential reportable segment as well as actions in the Architectural reportable segment and in our head offices (collectively, the "2022 Plan"). The optimization of our manufacturing capacity involves specific plants in the North American Residential segment and costs associated with the closure of these plants and related headcount reductions. Costs associated with the 2022 Plan also include severance and closure charges which will continue throughout 2023.

Inflation

In 2022, we realized higher costs across the various materials we purchase as a result of macroeconomic factors as well as increased logistics costs, wages, anti-dumping and countervailing duties and energy and fuel costs, and these higher costs not previously recognized will be realized in the first half of 2023. We expect the macroeconomic pressures on wood, resins and other certain key product categories and supply chain costs will moderate throughout 2023. Rising interest rates may impact the ability of our end consumers to purchase our products. Our profitability, margins and net sales could be adversely affected if inflationary trends do not moderate as expected and if interest rates continue to rise.

Acquisitions and Divestitures

We are pursuing a strategic initiative of optimizing our global business portfolio. On a continual basis, we evaluate and consider strategic acquisitions, divestitures and joint ventures to create shareholder value and enhance financial performance.

On January 3, 2023, we completed the acquisition of 100% of the outstanding equity of EPI Holdings, Inc. ("Endura"), for total consideration of approximately $408.1 million. Endura is a leading innovator and manufacturer of high-performance door frames and door system components in the United States. Endura’s product offerings include engineered frames, self-adjusting sill systems, weather sealing, multi-point locks and installation accessories used by builders and contractors in residential new construction as well as repair and remodeling applications. The acquisition is intended to accelerate our Doors That Do MoreTM strategy and maximize our growth potential.

Results of Operations

	Three Months Ended
(In thousands)	April 2, 2023			April 3, 2022
Net sales	$	725,984		$	726,217
Cost of goods sold	555,493			541,968
Gross profit	170,491			184,249
Gross profit as a % of net sales	23.5		%	25.4		%
Selling, general and administration expenses	101,705			83,246
Selling, general and administration expenses as a % of net sales	14.0		%	11.5		%
Restructuring costs (benefit)	3,678			(19)
Operating income	65,108			101,022
Interest expense, net	14,252			10,239
Other expense (income), net	52			(1,415)
Income before income tax expense	50,804			92,198
Income tax expense	11,360			23,477
Net income	39,444			68,721
Less: net income attributable to non-controlling interests	953			1,139
Net income attributable to Masonite	$	38,491		$	67,582

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Three Months Ended April 2, 2023, Compared with Three Months Ended April 3, 2022

Net Sales

Net sales in the three months ended April 2, 2023, were $726.0 million, a decrease of $0.2 million from $726.2 million in the three months ended April 3, 2022. Foreign exchange rate fluctuations negatively impacted net sales in the first quarter of 2023 by $11.2 million. The acquisition of Endura increased net sales by $59.8 million or 8.2%. Excluding the impact of foreign currency and our 2023 acquisition of Endura, net sales would have decreased by $48.6 million or 6.7% due to changes in volume, average unit price and sales of components. Lower volumes excluding the incremental impact of acquisitions or divestitures ("base volume") decreased net sales by $113.0 million or 15.6% in the first quarter of 2023 compared to the 2022 period. Net sales of components to external customers decreased $6.9 million or 1.0% in the first quarter of 2023 compared to the 2022 period. Average unit price increased net sales in the first quarter of 2023 by $71.1 million or 9.8% compared to the 2022 period.

Net Sales and Percentage of Net Sales by Reportable Segment

	Three Months Ended April 2, 2023
(In thousands)	North American Residential			Europe			Architectural			Corporate & Other		Total
Sales	$	569,429		$	63,716		$	92,861		$	5,349	$	731,355
Intersegment sales	(390)			(22)			(4,959)			—		(5,371)
Net sales to external customers	$	569,039		$	63,694		$	87,902		$	5,349	$	725,984
Percentage of consolidated external net sales	78.4		%	8.8		%	12.1		%

	Three Months Ended April 3, 2022
(In thousands)	North American Residential			Europe			Architectural			Corporate & Other		Total
Sales	$	569,429		$	81,839		$	74,659		$	6,196	$	732,123
Intersegment sales	(865)			(1,371)			(3,670)			—		(5,906)
Net sales to external customers	$	568,564		$	80,468		$	70,989		$	6,196	$	726,217
Percentage of consolidated external net sales	78.3		%	11.1		%	9.8		%

North American Residential

Net sales to external customers from facilities in the North American Residential segment in the three months ended April 2, 2023, were $569.0 million, an increase of $0.4 million or 0.1% from $568.6 million in the three months ended April 3, 2022. Foreign exchange rate fluctuations negatively impacted net sales in the first quarter of 2023 by $4.2 million. Excluding this exchange rate impact, net sales would have increased by $4.6 million or 0.8% due to changes in volume, average unit price, acquisitions and sales of components. Our 2023 acquisition increased net sales by $59.8 million or 10.5% in the first quarter of 2023. Average unit price increased net sales in the first quarter of 2023 by $46.7 million or 8.2% compared to the 2022 period. Lower base volume decreased net sales in the first quarter of 2023 by $99.4 million or 17.5% compared to the 2022 period due to softening end market demand in new construction and residential repair, renovation and remodeling channels. Net sales of components to external customers were $2.5 million lower in the first quarter of 2023 compared to the 2022 period.

Europe

Net sales to external customers from facilities in the Europe segment in the three months ended April 2, 2023, were $63.7 million, a decrease of $16.8 million or 20.9% from $80.5 million in the three months ended April 3, 2022. Foreign exchange rate fluctuations negatively impacted net sales in the first quarter of 2023 by $6.2 million. Excluding this exchange rate impact, net sales would have decreased by $10.6 million or 13.2% due to changes in volume, average unit price and sales of components. Lower base volume decreased net sales by $12.4 million or 15.4% in the first quarter

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of 2023 compared to the 2022 period due to overall economic trends in the United Kingdom. Net sales of components to external customers were $1.2 million lower in the first quarter of 2023 compared to the 2022 period. Average unit price increased net sales in the first quarter of 2023 by $3.0 million or 3.7% compared to the 2022 period.

Architectural

Net sales to external customers from facilities in the Architectural segment in the three months ended April 2, 2023, were $87.9 million, an increase of $16.9 million or 23.8% from $71.0 million in the three months ended April 3, 2022. Foreign exchange rate fluctuations negatively impacted net sales in the first quarter of 2023 by $0.8 million. Excluding this exchange rate impact, net sales would have increased by $17.7 million or 24.9% due to changes in volume, average unit price and sales of components. Average unit price increased net sales in the first quarter of 2023 by $19.7 million or 27.7% compared to the 2022 period. Lower base volume decreased net sales in the first quarter of 2023 by $1.2 million or 1.7% compared to the 2022 period. Net sales of components to external customers were $0.8 million lower in the first quarter of 2023 compared to the 2022 period.

Cost of Goods Sold

Cost of goods sold as a percentage of net sales was 76.5% and 74.6% for the three months ended April 2, 2023, and April 3, 2022, respectively. Overhead, direct labor and depreciation as a percentage of net sales increased by 2.3%, 0.6% and 0.3%, respectively, compared to the 2022 period. Material cost of sales and distribution as a percentage of net sales decreased by 0.8% and 0.5%, respectively, compared to the first quarter of 2022. Overhead as a percentage of net sales increased due to lower volumes, wage inflation and higher factory costs, partially offset by higher average unit prices as compared to the 2022 period. Direct labor as a percentage of net sales increased due to higher manufacturing wage and benefit inflation, partially offset by average unit prices. The increase in depreciation as a percentage of net sales was driven by the acquisition of Endura fixed assets as compared to the 2022 period. The decrease in material cost of sales as a percentage of net sales was driven by higher average unit prices and material cost savings projects, partially offset by commodity inflation. Distribution as a percentage of net sales decreased due to higher average unit prices, partially offset by lower volumes.

Selling, General and Administration Expenses

In the three months ended April 2, 2023, selling, general and administration ("SG&A") expenses, as a percentage of net sales, were 14.0%, as compared to 11.5% in the three months ended April 3, 2022, an increase of 250 basis points.

SG&A expenses in the three months ended April 2, 2023, were $101.7 million, an increase of $18.5 million from $83.2 million in the three months ended April 3, 2022. The overall increase was driven by incremental SG&A from the acquisition of Endura of $9.8 million; a $6.2 million increase in non-cash items including deferred compensation, loss (gain) on disposal of property, plant and equipment, share based compensation and depreciation and amortization; a $2.9 million increase in professional and other fees to support growth; and a $1.4 million increase in acquisition and due diligence related costs. These increases were partially offset by a $0.9 million decrease in personnel costs primarily driven by lower incentive compensation and savings from our 2022 Plan, partially offset by wage and benefit inflation and favorable foreign exchange impacts of $0.9 million.

Restructuring Costs (Benefit)

Restructuring costs (benefit) in the three months ended April 2, 2023, was $3.7 million of costs, compared to minimal benefit in the three months ended April 3, 2022. Restructuring costs in the current year period related primarily to the 2022 Plan.

Interest Expense, Net

Interest expense, net, in the three months ended April 2, 2023, was $14.3 million, compared to $10.2 million in the three months ended April 3, 2022. The increase in interest expense, net, is primarily due to the incremental borrowings under the Term Loan Facility and ABL Facility.

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Other Expense (Income), Net

Other expense (income), net includes profits and losses related to our non-majority owned unconsolidated subsidiaries that we recognize under the equity method of accounting, unrealized gains and losses on foreign currency remeasurements and other miscellaneous non-operating expenses. Other expense (income), net, in the three months ended April 2, 2023, was $0.1 million of expense, compared to $1.4 million of income in the three months ended April 3, 2022. The change in other expense (income), net is primarily due to a change in our portion of the net gains and losses related to our non-majority owned unconsolidated subsidiaries that are recognized under the equity method of accounting, a change in hedging gains and losses and a change in the fair value of plan assets in the deferred compensation rabbi trust, partially offset by unrealized gains and losses on foreign currency remeasurements.

Income Tax Expense

Income tax expense in the three months ended April 2, 2023, was $11.4 million, compared to $23.5 million in the three months ended April 3, 2022. The decrease in income tax expense is primarily due to the mix of income or losses within the tax jurisdictions with various tax rates in which we operate.

Segment Information

	Three Months Ended April 2, 2023
(In thousands)	North American Residential			Europe			Architectural			Corporate & Other		Total
Adjusted EBITDA	$	107,881		$	5,151		$	5,350		$	(12,217)	$	106,165
Adjusted EBITDA as a percentage of segment net sales	19.0		%	8.1		%	6.1		%			14.6		%

	Three Months Ended April 3, 2022
(In thousands)	North American Residential			Europe			Architectural			Corporate & Other		Total
Adjusted EBITDA	$	127,667		$	11,843		$	(2,898)		$	(11,860)	$	124,752
Adjusted EBITDA as a percentage of segment net sales	22.5		%	14.7		%	(4.1)		%			17.2		%

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The following reconciles net income (loss) attributable to Masonite to Adjusted EBITDA:    

	Three Months Ended April 2, 2023
(In thousands)	North American Residential		Europe		Architectural		Corporate & Other		Total
Net income (loss) attributable to Masonite	$	86,755	$	203	$	1,465	$	(49,932)	$	38,491
Plus:
Depreciation	13,232		2,204		2,957		3,092		21,485
Amortization	3,790		2,808		252		571		7,421
Share based compensation expense	—		—		—		6,054		6,054
Loss (gain) on disposal of property, plant and equipment	1,040		(3)		(13)		14		1,038
Restructuring costs	2,380		—		684		614		3,678
Interest expense, net	—		—		—		14,252		14,252
Other (income) expense, net	(28)		(61)		—		141		52
Income tax expense	—		—		—		11,360		11,360
Other items (1)	—		—		5		1,376		1,381
Net income attributable to non-controlling interest	712		—		—		241		953
Adjusted EBITDA	$	107,881	$	5,151	$	5,350	$	(12,217)	$	106,165

(1) Other items include $1,381 in acquisition and due diligence related costs in the three months ended April 2, 2023, and were recorded in selling, general and administration expenses within the condensed consolidated statements of comprehensive income.

	Three Months Ended April 3, 2022
(In thousands)	North American Residential		Europe		Architectural		Corporate & Other		Total
Net income (loss) attributable to Masonite	$	117,033	$	5,732	$	(2,826)	$	(52,357)	$	67,582
Plus:
Depreciation	9,964		2,341		2,879		2,088		17,272
Amortization	619		3,270		182		541		4,612
Share based compensation expense	—		—		—		4,719		4,719
Loss (gain) on disposal of property, plant and equipment	338		(12)		(3,180)		—		(2,854)
Restructuring (benefit) costs	(91)		6		47		19		(19)
Interest expense, net	—		—		—		10,239		10,239
Other (income) expense, net	(790)		506		—		(1,131)		(1,415)
Income tax expense	—		—		—		23,477		23,477
Net income attributable to non-controlling interest	594		—		—		545		1,139
Adjusted EBITDA	$	127,667	$	11,843	$	(2,898)	$	(11,860)	$	124,752

Adjusted EBITDA in our North American Residential segment was $107.9 million in the three months ended April 2, 2023, a decrease of $19.8 million, or 15.5%, from $127.7 million in the three months ended April 3, 2022. Adjusted EBITDA in the North American Residential segment included corporate allocations of shared costs of $22.7 million and $22.5 million in the first quarter of 2023 and 2022, respectively. The allocations generally consist of certain costs of human resources, legal, finance, information technology, research and development, marketing and share based compensation.

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Adjusted EBITDA in our Europe segment was $5.2 million in the three months ended April 2, 2023, a decrease of $6.7 million, or 56.5%, from $11.8 million in the three months ended April 3, 2022. Adjusted EBITDA in the Europe segment included corporate allocations of shared costs of $1.8 million and $1.7 million in the first quarter of 2023 and 2022, respectively. The allocations generally consist of certain costs of human resources, legal, finance, information technology, marketing and share based compensation.

Adjusted EBITDA in our Architectural segment was $5.4 million of earnings in the three months ended April 2, 2023, an increase of $8.3 million, or 284.7%, from a loss of $2.9 million in the three months ended April 3, 2022. Adjusted EBITDA in the Architectural segment also included corporate allocations of shared costs of $2.9 million and $2.9 million in the first quarter of 2023 and 2022, respectively. The allocations generally consist of certain costs of human resources, legal, finance, information technology, research and development, marketing and share based compensation.

Liquidity and Capital Resources

Our liquidity needs for operations vary throughout the year. Our principal sources of liquidity are cash flows from operating activities, the borrowings under our ABL Facility and an accounts receivable sales program with a third party ("AR Sales Program"), as well as our existing cash balance. Our anticipated uses of cash in the near term include, working capital needs, capital expenditures for critical maintenance, safety and regulatory projects, and share repurchases. On a continual basis, we evaluate and consider strategic acquisitions, divestitures and joint ventures to create shareholder value and enhance financial performance. As of April 2, 2023, we do not have any material commitments for capital expenditures.

We believe that our cash balance on hand, future cash generated from operations, the use of our AR Sales Program and our ABL Facility along with our ability to access the capital markets will provide adequate liquidity for the foreseeable future. As of April 2, 2023, we had $210.7 million of cash and cash equivalents, availability under our ABL Facility of $313.4 million and availability under our AR Sales Program of $18.1 million.

Cash Flows

Cash provided in operating activities was $56.3 million during the three months ended April 2, 2023, compared to cash used in operating activities of $37.8 million in the three months ended April 3, 2022. This $94.1 million increase in cash provided by operating activities was due to a $115.7 million increase in working capital and other assets and liabilities, partially offset by a $21.6 million decrease in net income attributable to Masonite, adjusted for non-cash and non-operating items in the first three months of 2023 compared to the same period in 2022.

Cash used in investing activities was $373.0 million during the three months ended April 2, 2023, compared to $13.3 million in the three months ended April 3, 2022. This $359.7 million increase in cash used in investing activities was primarily driven by a $353.6 million increase in cash used in the acquisition of Endura (net of cash acquired), an $8.7 million increase in cash additions to property, plant and equipment, the absence of $6.4 million of proceeds from the sale of property, plant and equipment, and a $3.0 increase in cash used in other investing activities, partially offset by $12.0 million of proceeds from repayment of a note receivable in the first three months of 2023 compared to the same period in 2022.

Cash provided by financing activities was $229.1 million during the three months ended April 2, 2023, compared to $144.3 million of cash used in financing activities during the three months ended April 3, 2022. This $373.4 million increase in cash provided by financing activities was driven by a $246.4 million increase in cash provided by debt-related transactions, a $125.2 million decrease in cash used for repurchases of common shares, a $1.0 million decrease in cash used for tax withholding on share based awards and a $0.8 million decrease in distributions to non-controlling interests in the first three months of 2023 compared to the same period in 2022.

Share Repurchases

The Company's Board of Directors has approved five share repurchase authorizations, the most recent being an incremental $200.0 million share repurchase program approved on February 21, 2022. Under this program, the Company may repurchase shares from time to time, depending on market conditions and alternate uses of capital. The timing and actual number of shares repurchased will depend on a variety of factors, including price, general business and market conditions and alternate uses of capital. The share repurchase program may be effected through Rule 10b5-1 plans, open

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market purchases, each in compliance with Rule 10b-18 under the Exchange Act, or privately negotiated transactions. The program may be suspended or discontinued at any time and does not have an expiration date. In addition, the Company announced that its Board of Directors authorized it to enter into an accelerated share repurchase ("ASR") transaction as part of the new share repurchase program. The Company entered into an ASR transaction during the first quarter of 2022 with a third-party financial institution for the repurchase of $100.0 million of its outstanding common shares. At inception, pursuant to the agreement, the Company paid $100.0 million to the financial institution using cash on hand and received an initial delivery of 848,087 common shares on the same day. The final delivery of 319,678 common shares occurred in the second quarter of 2022. The $100.0 million ASR transaction was therefore completed in the second quarter with a total delivery of 1,167,765 common shares at a volume-weighted average price ("VWAP") per share minus an agreed upon discount totaling $85.63 per share. The cash paid was reflected as a reduction of equity at the initial delivery of shares and the number of common shares outstanding were reduced at the dates of physical delivery. During the three months ended April 2, 2023, we repurchased 168,523 of our common shares in the open market at an aggregate cost of $14.7 million as part of the share repurchase programs. During the three months ended April 3, 2022, we repurchased and retired 1,236,330 of our common shares in the open market at an aggregate cost of $140.0 million as part of the share repurchase programs and ASR. As of April 2, 2023, there was $232.2 million available for repurchase in accordance with the share repurchase programs.

Other Liquidity Matters

Our cash and cash equivalents balance includes cash held in foreign countries in which we operate. Cash held outside Canada, in which we are incorporated, is free from significant restrictions that would prevent the cash from being accessed to meet our liquidity needs including, if necessary, to fund operations and service debt obligations in Canada. However, earnings from certain jurisdictions are indefinitely reinvested in those jurisdictions. Upon the repatriation of any earnings to Canada, in the form of dividends or otherwise, we may be subject to Canadian income taxes and withholding taxes payable to the various foreign countries. As of April 2, 2023, we do not believe adverse tax consequences exist that restrict our use of cash or cash equivalents in a material manner.

We also routinely monitor the changes in the financial condition of our customers and the potential impact on our results of operations. There has not been a change in the financial condition of any customer that has had a material adverse effect on our results of operations. However, if economic conditions were to deteriorate, it is possible there could be an impact on our results of operations in a future period and this impact could be material.

Accounts Receivable Sales Program

Under the AR Sales Program, we can transfer ownership of eligible trade accounts receivable of certain customers. Receivables are sold outright to a third party who assumes the full risk of collection, without recourse to us in the event of a loss. Transfers of receivables under this program are accounted for as sales. Proceeds from the transfers reflect the face value of the accounts receivable less a discount. Receivables sold under the AR Sales Program are excluded from trade accounts receivable in the condensed consolidated balance sheets and are included in cash flows from operating activities in the condensed consolidated statements of cash flows. The discounts on the sales of trade accounts receivable sold, if any, under the AR Sales Program were not material for any of the periods presented and were recorded in selling, general and administration expenses within the condensed consolidated statements of income and comprehensive income.

3.50% Senior Notes due 2030

On July 26, 2021, we issued $375.0 million aggregate principal senior unsecured notes (the "2030 Notes"), all of which was outstanding as of April 2, 2023. The 2030 Notes bear interest at 3.50% per annum. The 2030 Notes were issued under an indenture which contains limited covenants that are described in detail in our Annual Report. As of April 2, 2023, we were in compliance with all covenants under the indenture governing the 2030 Notes.

5.375% Senior Notes due 2028

On July 25, 2019, we issued $500.0 million aggregate principal senior unsecured notes (the "2028 Notes"), all of which was outstanding as of April 2, 2023. The 2028 Notes bear interest at 5.375% per annum. The 2028 Notes were issued under an indenture which contains restrictive covenants that are described in detail in our Annual Report. As of April 2, 2023, we were in compliance with all covenants under the indenture governing the 2028 Notes.

27

MASONITE INTERNATIONAL CORPORATION

Term Loan Facility

On December 13, 2022, we and certain of our subsidiaries entered into a new delayed-draw term loan credit agreement (the "Term Loan Credit Agreement") maturing on December 12, 2027 (the "Term Loan Maturity Date"). The Term Loan Credit Agreement provides for a senior secured five-year delayed-draw term loan facility of $250.0 million (the "Term Loan Facility"). Loans under the Term Loan Facility (the "Term Loans") will bear interest at a rate equal to, at our option, (1) the Adjusted Term SOFR Rate (as defined in the Term Loan Credit Agreement) plus an applicable margin of 2.25% or (2) an alternate base rate equal to the greatest of (i) the "Prime Rate" in the U.S. last quoted by The Wall Street Journal, (ii) 0.50% above the greater of the federal funds rate and the rate comprised of both overnight federal funds and overnight eurodollar transactions denominated in U.S. dollars, (iii) 1.00% above the Adjusted Term SOFR Rate for a one month interest period and (iv) 1.00%, plus, in each case, an applicable margin of 1.25%, subject to, in each of cases (1) and (2), an agreed interest rate floor. The Term Loans are repayable in equal quarterly installments for an annual aggregate amortization payment equal to 15% of the aggregate principal amount of the Term Loans, with the balance of the principal being due on the Term Loan Maturity Date.

The Term Loan Credit Agreement also includes a quarterly ticking fee of 25 basis points per annum payable to the lenders under the Term Loan Facility beginning on January 3, 2023 (the "Closing Date") in respect of the unutilized commitments thereunder. As a result of the incurrence of the Term Loans on the Closing Date such ticking fees were not (and shall not be) payable to the Lenders.

The Borrower also pays customary agency fees.

Obligations under the Term Loan Credit Agreement are fully and unconditionally guaranteed, jointly and severally, by us and by certain of our directly or indirectly wholly-owned subsidiaries organized in the United States and are secured by the equity in, and substantially all the assets of, such subsidiaries. The Term Loans were funded in an amount of $250.0 million and applied to finance a portion of the consideration payable in connection with the consummation of the Endura acquisition on January 3, 2023. We received net proceeds of $246.4 million after deducting $3.6 million of debt issuance costs. The debt issuance costs were capitalized as a reduction to the carrying value of debt and are being accreted to interest expense over the term of the loan using the effective interest method.

The Term Loan Credit Agreement contains various customary representations, warranties by us and covenants that are described in detail in our Annual Report. As of April 2, 2023, we were in compliance with all covenants under the indenture governing the Term Loan Credit Agreement.

ABL Facility

On January 31, 2019, we and certain of our subsidiaries entered into a $250.0 million asset-based revolving credit facility (the "ABL Facility") maturing on January 31, 2024, which replaced the previous facility. On October 28, 2022, we and certain of our subsidiaries entered into an amendment which, among other things, (i) increased the revolving credit commitments available thereunder by $100.0 million to an aggregate amount of $350.0 million and (ii) replaced the LIBOR-based interest rate applicable to borrowings thereunder in U.S. dollars with an interest rate based on the sum of (x) a "Term SOFR" rate published by the CME Group Benchmark Administration Limited (CBA) plus (y) 10 basis points ("Adjusted Term SOFR"). Additionally, on December 12, 2022, we entered into an amendment to the ABL Facility, which, among other things, extended the maturity of the ABL Facility from January 31, 2024 to December 12, 2027. The terms of the ABL Facility remained otherwise substantially unchanged and are described in detail in our Annual Report. On January 3, 2023, we borrowed $100.0 million under our ABL Facility in order to fund a portion of the cash consideration paid for the acquisition of Endura. During the first quarter of 2023, we repaid all amounts outstanding under the ABL Facility.

The ABL Facility contains various customary representations, warranties by us and covenants that are described in detail in our Annual Report. As of April 2, 2023, we were in compliance with all covenants under the credit agreement governing the ABL Facility. We had availability of $313.4 million under our ABL Facility and there were no amounts outstanding as of April 2, 2023.

Changes in Accounting Standards and Policies

Changes in accounting standards and policies are discussed in Note 1. Business Overview and Significant Accounting Policies in the Notes to the Condensed Consolidated Financial Statements in this Quarterly Report.

28

MASONITE INTERNATIONAL CORPORATION

Critical Accounting Policies and Estimates

Our management’s discussion and analysis of financial condition and results of operations are based on our condensed consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these condensed consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reported period.

Please refer to "Critical Accounting Policies and Estimates" described in Part II, Item 7, "Management’s Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report, from which there have been no material changes.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

For our disclosures about market risk, please see Part II, Item 7A. "Quantitative and Qualitative Disclosures about Market Risk," in our Annual Report. We believe there have been no material changes to the information provided therein.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures as defined in Rule 13a-15(e) and Rule 15d-15(e) under the Securities and Exchange Act of 1934, as amended (the "Exchange Act"), that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms and that such information is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and the Chief Financial Officer have concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were effective.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting during the fiscal quarter covered by this report that have materially affected, or that are reasonably likely to materially affect, our internal control over financial reporting.

29

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

The information required with respect to this item can be found in Note 7. Commitments and Contingencies in the Notes to the Condensed Consolidated Financial Statements in this Quarterly Report and is incorporated by reference into this Part II, Item 1. Such information should be read in conjunction with the information contained under Part I, Item 3 "Legal Proceedings" included in our Annual Report.

Item 1A. Risk Factors

You should carefully review and consider the information regarding certain factors which could materially affect our business, financial condition or future results as set forth under Item 1A "Risk Factors" in our Annual Report. There have been no material changes from the risk factors disclosed in such Annual Report on Form 10-K.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

(a) Unregistered Sale of Equity Securities.

None.

(b) Use of Proceeds.

Not applicable.

(c) Repurchases of Our Equity Securities.

During the three months ended April 2, 2023, we repurchased 168,523 of our common shares in the open market.

	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs
January 2, 2023 through January 29, 2023	6,758	$	82.42	6,758	$	246,347,299
January 30, 2023 through February 26, 2023	—	—		—	246,347,299
February 27, 2023 through April 2, 2023	161,765	87.54		161,765	232,186,848
Total	168,523	$	87.33	168,523

The Company's Board of Directors has approved five share repurchase authorizations, the most recent being an incremental $200.0 million share repurchase program approved on February 21, 2022. Under this program, the Company may repurchase shares from time to time, depending on market conditions and alternate uses of capital. The timing and actual number of shares repurchased will depend on a variety of factors, including price, general business and market conditions and alternate uses of capital. The share repurchase program may be effected through Rule 10b5-1 plans, open market purchases, each in compliance with Rule 10b-18 under the Exchange Act, or privately negotiated transactions. The program may be suspended or discontinued at any time and does not have an expiration date. As of April 2, 2023, $232.2 million was available for repurchase in accordance with the share repurchase programs.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

30

Item 5. Other Information

None.

Item 6. Exhibits

The following is a list of all exhibits filed or furnished as part of this report:

Exhibit No.		Description
2.1		Securities Purchase Agreement, dated as of November 2, 2022, by and among Masonite, Endura, Endura Stockholders, Endura Warrant Holders and Endura’s equityholders’ representative (incorporated by reference to Exhibit 2.1 to the Company's Current Report on Form 8-K (File No. 011-11796) filed with the Securities and Exchange Commission on November 3, 2022)
10.1*#		Form of Performance Restricted Stock Unit Agreement pursuant to the Masonite International Corporation 2021 Omnibus Incentive Plan (February 2023)
31.1*		Certification of Periodic Report by Chief Executive Officer under Section 302 of the Sarbanes-Oxley Act of 2002
31.2*		Certification of Periodic Report by Chief Financial Officer under Section 302 of the Sarbanes-Oxley Act of 2002
32.1*		Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2*		Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101*		Interactive Data Files pursuant to Rule 405 of Regulation S-T formatted in Inline Extensible Business Reporting Language ("Inline XBRL"): (i) the Registrant's Condensed Consolidated Statements of Income and Comprehensive Income for the three months ended April 2, 2023, and April 3, 2022; (ii) the Registrant's Condensed Consolidated Balance Sheets as of April 2, 2023, and January 1, 2023; (iii) the Registrant's Condensed Consolidated Statements of Changes in Equity for the three months ended April 2, 2023, and April 3, 2022; (iv) the Registrant's Condensed Consolidated Statements of Cash Flows for the three months ended April 2, 2023, and April 3, 2022; and (v) the notes to the Registrant's Condensed Consolidated Financial Statements
104*		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
*	Filed or furnished herewith.
#	Denotes management contract or compensatory plan.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.    

		MASONITE INTERNATIONAL CORPORATION
		(Registrant)
Date:	May 9, 2023	By	/s/ Russell T. Tiejema
		Russell T. Tiejema
		Executive Vice President and Chief Financial Officer
		(Principal Financial Officer)
		By	/s/ Patrick D. Brisley
		Patrick D. Brisley
		Vice President, Chief Accounting Officer
		(Principal Accounting Officer)

31

EX-10.1

PERFORMANCE RESTRICTED STOCK UNIT AGREEMENT

PURSUANT TO THE

MASONITE INTERNATIONAL CORPORATION

2021 OMNIBUS INCENTIVE PLAN

UNITED STATES

* * * * *

Participant:        

Grant Date:        

Number of Performance Restricted Stock Units Granted:

* * * * *

    THIS PERFORMANCE RESTRICTED STOCK UNIT AWARD AGREEMENT (this “Agreement”), dated as of the Grant Date specified above, is entered into by and between Masonite International Corporation, a British Columbia corporation (the “Company”), and the Participant specified above, pursuant to the Masonite International Corporation 2021 Omnibus Incentive Plan, as may be amended from time to time (the “Plan”), which is administered by the Committee; and

    WHEREAS, it has been determined under the Plan that it would be in the best interests of the Company to grant Performance Restricted Stock Units (“PRSUs”) provided herein to the Participant.

NOW, THEREFORE, in consideration of the mutual covenants and promises hereinafter set forth and for other good and valuable consideration, the parties hereto hereby mutually covenant and agree as follows:

1.Incorporation By Reference; Plan Document Receipt. This Agreement is subject in all respects to the terms and provisions of the Plan (including, without limitation, any amendments thereto adopted at any time and from time to time unless such amendments are expressly intended not to apply to the grant of the PRSUs hereunder), all of which terms and provisions are made a part of and incorporated in this Agreement as if they were each expressly set forth herein. The Participant hereby acknowledges receipt of a true copy of the Plan and that the Participant has read the Plan carefully and fully understands its content. In the event of any conflict between the terms of this Agreement and the terms of the Plan, the terms of the Plan shall control.

2.Grant of Restricted Stock Unit Award. The Company hereby grants to the Participant, as of the Grant Date specified above, the number of PRSUs specified above. Except as otherwise provided by the Plan, the Participant agrees and understands that nothing contained in this Agreement provides, or is intended to provide, the Participant with any protection against potential future dilution of the Participant’s interest in the Company for any reason. The Participant shall not have the rights of a stockholder in respect of the shares of Common Stock underlying this Award until such shares are delivered to the Participant in accordance with Section 4.

3.Vesting.

(a)General.

(i) Performance-Based Vesting. All of the PRSUs are nonvested and forfeitable as of the Grant Date. Subject to the satisfaction of the time-based vesting condition under Section 3(a)(ii) hereof, and except as set forth in Sections 3(b) and 3(c) hereof, the PRSUs shall satisfy the performance-based vesting condition as follows:

(A) The PRSUs granted hereunder shall satisfy the performance-based vesting condition based on the Company’s achievement of the two performance metrics set forth on Exhibit “A” hereto with respect to the Company’s 2025fiscal year for the Absolute Net Sales achievement performance metric and with respect to a performance period commencing on January 1, 2023 and ending on December 31, 2025 for the Relative TSR performance metric (collectively, the “Metrics”), each of which Metrics is weighted at 50%. Exhibit “A” is attached hereto, incorporated in, and made a part of this Agreement.

(B) For purposes of determining the number of PRSUs that will satisfy the performance-based vesting condition in accordance with the foregoing provisions, the number of PRSUs that will satisfy the performance-based vesting condition shall be determined based on the Company’s actual performance during the applicable performance period as compared to the applicable Metric. A number of PRSUs equal to 100% of the PSRUs granted hereunder shall satisfy the performance-based vesting condition based on the achievement of Target level performance with respect to each of the two Metrics set forth on Exhibit “A”, a number of PSRUs equal to 50% of the PRSUs granted hereunder shall satisfy the performance-based vesting condition based on the achievement of the Threshold level of performance with respect to each of the two Metrics set forth on Exhibit “A”, and a number of PRSUs equal to 200% of the PSRUs granted hereunder shall satisfy the performance-based vesting condition based on the achievement of the Maximum level of performance with respect to each of the two Metrics shown on Exhibit “A” hereto. The determination of the actual performance against the Metrics shall be calculated separately for each of the Metrics. The number of PSRUs that satisfy the performance-based vesting condition for actual performance between Threshold and Target and/or Target and Maximum shall be calculated for each of the two Metrics shown on Exhibit “A” hereto using a straight line interpolation between (i) the Threshold and the Target, or (ii) the Target and the Maximum. The actual level of performance against the Metrics shall be calculated after the end of the Company’s 2025fiscal year based on the Company’s performance over the applicable performance period. If the Company’s actual performance is below the Threshold level of performance with respect to both of the Metrics set forth on Exhibit “A”, no PRSUs will satisfy the performance-based vesting condition. PRSUs that do not satisfy the performance-based vesting condition based on the foregoing criteria shall be immediately forfeited, effective as of December 31, 2025, without any further action of the Company whatsoever and without any consideration being paid therefor, and shall cease to be eligible to become fully vested in accordance with Sections 3(a)(ii), 3(b) and 3(c) hereof.

(ii) Time-Based Vesting. Except as set forth in Sections 3(b) and (c) hereof, the aggregate number of PRSUs that have satisfied the performance-based vesting conditions pursuant to Section 3(a)(i) shall satisfy the time-based vesting condition on [February 28, 2026] subject to the Participant’s continued service with the Company or any of its Affiliates through such date.

There shall be no proportionate or partial vesting in the periods prior to the vesting date and all vesting shall occur only on the vesting date, subject to the Participant’s continued employment with the Company or its Subsidiaries through the vesting date. Subject to the provisions of Sections 3(b) and 3(c) hereof, PRSUs shall only become fully vested and payable hereunder to the extent that the vesting conditions contained in both of Section 3(a)(i) and Section 3(a)(ii) are satisfied and, accordingly, the “vesting date” for any PRSUs shall be the later of (x) the date on which the time-vesting condition is satisfied and (y) where applicable, the date on which the Committee certifies the level at which the Metrics have been achieved in order for such PRSU to have satisfied the performance-based vesting conditions.

(b)Certain Terminations. All unvested PRSUs shall immediately become vested upon a Termination due to (i) the Participant’s death, or (ii) the Participant’s Disability; provided that if either event occurs: (x) before the end of the Company’s 2025 fiscal year, the number of unvested PRSUs that vest shall be 100% of the PSRUs granted hereunder, or (y) after the end of the Company’s 2025fiscal year, the number of unvested PRSUs that vest shall be calculated based on the Company’s actual performance against the Metrics.

(c) Change in Control. Notwithstanding anything to the contrary set forth in Section 3(a) hereof, if, within thirty (30) days prior to or twenty four (24) months following the completion of a Change in Control or at any time prior to a Change in Control at the request of a prospective purchaser whose proposed purchase would constitute a Change in Control upon its completion, the Company, or any of its Subsidiaries, terminates the Participant’s employment without Cause or the Participant terminates employment for Good Reason (such termination, a “Qualifying Termination”), all unvested PRSUs shall immediately become vested on the date of the Qualifying Termination (or, in the event that the Participant experiences a Qualifying Termination prior to the completion of a Change in Control other than at the request of a prospective purchaser, on the Change in Control); provided further that if the Change in Control (or, in the event of a Qualifying Termination at the request of the prospective purchaser but for which a Change in Control does not ultimately occur, the Qualifying Termination) occurs: (i) before the end of the Company’s 2025 fiscal year, the number of unvested PRSUs that vest shall be 100% of the PSRUs granted hereunder, or (ii) after the end of the Company’s 2025fiscal year, the number of unvested PRSUs that vest shall be calculated based on the Company’s actual performance against the Metrics. For the avoidance of doubt, all references to a Termination of the Participant’s employment “without Cause” in this Agreement shall, to the extent applicable, include any Termination due to the expiration of the employment term under the Participant’s Employment Agreement (as defined below) following notice of nonrenewal thereof by the Company. In order to accomplish the intention of this provision, if the Participant experiences a Qualifying Termination prior to the completion of a Change in Control (other than at the request of a prospective purchaser), all unvsted PRSUs shall remain outstanding for a period of thirty (30) days following the date of such Participant’s Qualifying Termination and (A) if a Change in Control occurs during such thirty (30)-day period, such unvested PRSUs shall vest upon the completion of the Change in Control (in accordance with this Section 3(a)(c)) or (B) if a Change in Control does not occur prior to the expiration of such thirty (30)-day period, the unvested PRSUs shall be cancelled and forfeited upon the expiration of such thirty (30)-day period.

(d)Forfeiture. Subject to Section 3(b) and 3(c), all unvested PRSUs shall be immediately forfeited upon the Participant’s Termination for any reason.

(e)Committee Discretion to Accelerate Vesting. Notwithstanding the foregoing, the Committee may, in its sole discretion, provide for accelerated vesting of the PRSUs at any time and for any reason.

4.Delivery of Shares of Common Stock.

(a)General. Subject to Section 4(b) hereof and Section 14.17 of the Plan, the Company shall deliver to the Participant the aggregate shares of Common Stock underlying the outstanding PRSUs within thirty (30) days following such vesting date. In connection with the delivery of the shares of Common Stock pursuant to this Agreement, the Participant agrees to execute any documents reasonably requested by the Company. In no event shall the Participant be entitled to receive any shares of Common Stock with respect to any unvested or forfeited portion of the PRSUs.

(b)Blackout Periods. If the Participant is subject to any Company “blackout” policy or other trading restriction imposed by the Company on the date such distribution would otherwise be made pursuant to Section 4(a), the Company may elect to delay such distribution until the date the Participant is not subject to any such policy or restriction or such earlier or later date as required by applicable law, consistent with the requirements of Section 409A of the Code.

(c)Deferrals. If permitted by the Company, the Participant may elect, subject to the terms and conditions of the Plan and any other applicable written plan or procedure adopted by the Company from time to time for purposes of such election, to defer the distribution of all or any portion of the shares of Common Stock that would otherwise be distributed to the Participant hereunder (the “Deferred Shares”), consistent with the requirements of Section 409A of the Code. Upon the vesting of PRSUs that have been so deferred, the applicable number of Deferred Shares shall be credited to a bookkeeping account established on the Participant’s behalf (the “Account”). Subject to Section 6 below, the number of shares of Common Stock equal to the number of Deferred Shares credited to the Participant’s Account shall be distributed to the Participant in accordance with the terms and conditions of the Plan and the other applicable written plans or procedures of the Company, consistent with the requirements of Section 409A of the Code.

5.Dividends and Other Distributions. The Participant shall be entitled to receive all dividends and other distributions paid with respect to the shares of Common Stock underlying the PRSUs, provided that any such dividends or other distributions will be subject to the same vesting requirements as the underlying PRSUs and shall be paid at the time the shares of Common Stock are delivered pursuant to Section 4. If any dividends or distributions are paid in shares of Common Stock with respect to unvested shares, the shares of Common Stock shall be deposited with the Company and shall be subject to the same restrictions on transferability and forfeiture as the PRSUs with respect to which they were paid.

6.Forfeiture and Clawback. In the event the Company determines that the Participant has (i) materially violated any of the provisions set forth in Section 7 hereof and has failed to cure such violation within fifteen (15) days of written notice that is given within thirty (30) days of the Company becoming aware of such violation, or (ii) engaged in Detrimental Misconduct or Financial Misconduct, unless otherwise determined by the Company, the following shall result:

(a)any outstanding PRSUs, whether vested or unvested, shall immediately be terminated and forfeited for no consideration,

(b)if the shares of Common Stock subject to this Agreement have been distributed to the Participant (or any transferee permitted pursuant to Section 8(b) hereof) and the Participant (or transferee, as applicable) no longer holds some or all of such shares, the Participant shall repay to the Company, in cash, within five (5) business days after demand is made therefore by the Company (which must be made within thirty (30) days of such failure to cure), an amount equal to the sum of (I) the total amount of any cash previously paid to the Participant hereunder; and (II) the total amount of any value received by the Participant upon any disposition of any shares of Common Stock paid to the Participant hereunder; and

(c)if the shares of Common Stock subject to this Agreement have been distributed to the Participant and the Participant (or any transferee permitted pursuant to Section 8(b) hereof) continues to hold some or all of such shares of Common Stock, the Participant or such transferee shall forfeit and transfer to the Company for no consideration such shares. If the Participant or such transferee fails to deliver all or any of the shares of Common Stock upon the Company’s demand, then the Secretary of the Company shall be authorized to effect the Company’s repurchase of such shares of Common Stock on the Company’s books and records, without further notice with zero value being paid to the Participant.

7.Restrictive Covenants. As a condition to the receipt of the PRSUs and/or the delivery of shares of Common Stock hereunder, the Participant agrees as follows:

(a)Confidentiality, Non-Disclosure and Non-Competition Agreement. The Company and the Participant acknowledge and agree that during the Participant’s employment with the Company or its Affiliates, the Participant will have access to and may assist in developing Confidential Information and will occupy a position of trust and confidence with respect to the affairs and business of the Company and its Affiliates. The Participant agrees that the obligations set forth in this Section 7 are necessary to preserve the confidential and proprietary nature of Confidential Information and to protect the Company and its Affiliates against harmful solicitation of employees and customers, harmful competition and other actions by the Participant that would result in serious adverse consequences for the Company and its Affiliates.

(b)Non-Disclosure. During and after the Participant’s employment with the Company or its Affiliates, the Participant will not use, disclose, copy or transfer any Confidential Information other than as authorized in writing by the Company or within the scope of the Participant’s duties with the Company as determined reasonably and in good faith by the Participant. Anything herein to the contrary notwithstanding, the provisions of this Section 7(b) shall not apply (i) when disclosure is required by law or by any court, arbitrator, mediator or administrative or legislative body (including any committee thereof) with actual or apparent jurisdiction to order the Participant to disclose or make accessible any information; provided that prior to any such disclosure the Participant shall provide the Company with prompt written notice of the requirements to disclose and an opportunity object to such disclosure and the Participant shall cooperate with the Company in filing such objection; or (ii) as to information that becomes generally known to the public or within the relevant trade or industry other than

due to the Participant’s violation of this Section 7(b). Nothing in this Agreement shall prohibit or impede the Participant from communicating, cooperating or filing a complaint with any U.S. federal, state or local governmental or law enforcement branch, agency or entity (collectively, a “Governmental Entity”) with respect to possible violations of any U.S. federal, state or local law or regulation, or otherwise making disclosures to any Governmental Entity, in each case, that are protected under the whistleblower provisions of any such law or regulation, provided, that in each case such communications and disclosures are consistent with applicable law. The Participant understands and acknowledges that an individual shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made (i) in confidence to a federal, state, or local government official or to an attorney solely for the purpose of reporting or investigating a suspected violation of law, or (ii) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. The Participant understands and acknowledges further that an individual who files a lawsuit for retaliation by an employer for reporting a suspected violation of law may disclose the trade secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual files any document containing the trade secret under seal, and does not disclose the trade secret, except pursuant to court order. Notwithstanding the foregoing, under no circumstance is the Participant authorized to disclose any information covered by the Company’s attorney-client privilege or attorney work product or the Company’s trade secrets without the prior written consent of the Company’s General Counsel or other officer designated by the Company.

(c)Materials. The Participant will use Confidential Information only for normal and customary use in the Company’s business, as determined reasonably and in good faith by the Company. The Participant will return to the Company all Confidential Information and copies thereof and all other property of the Company or any of its Affiliates at any time upon the request of the Company and in any event immediately after termination of the Participant’s employment. The Participant agrees to identify and return to the Company any copies of any Confidential Information after the Participant ceases to be employed by the Company or its Affiliates. Anything to the contrary notwithstanding, nothing in this Section 7 shall prevent the Participant from retaining a home computer (provided all Confidential Information has been removed), papers and other materials of a personal nature, including diaries, calendars and Rolodexes, information relating to his/her compensation or relating to reimbursement of expenses, information that may be needed for tax purposes, and copies of compensation and benefits plans, programs and agreements relating to his/her employment.

(d)No Solicitation or Hiring of Employees. During the Non-Compete Period, the Participant shall not solicit, entice, persuade or induce any individual who is employed by the Company or its Affiliates (or who was so employed within twelve (12) months prior to the Participant’s action) to terminate or refrain from continuing such employment or to become employed by or enter into contractual relations with any other individual or entity other than the Company or its Affiliates, and the Participant shall not hire, directly or indirectly, for himself or any other person, as an employee, consultant or otherwise, any such person. Anything to the contrary notwithstanding, the Company agrees that (i) the Participant’s responding to an unsolicited request from any former employee of the Company for advice on employment matters; and (ii) the Participant’s responding to an unsolicited request for an employment reference regarding any former employee of the Company from such former employee, or from a third party, by providing a reference setting forth his/her personal views about such former employee, shall not be deemed a violation of this Section 7(d); in each case, to the extent the Participant does not encourage the former employee to become employed by a company or business that employs the Participant or with which the Participant is otherwise associated (including, but not limited to, association as a sole proprietor, owner, employer, partner, principal, investor, joint venturer, shareholder, associate, employee, member, consultant, contractor, director or otherwise).

(e)Non-Competition.

(i) During the Non-Compete Period, the Participant shall not, directly or indirectly, (A) solicit, service, or assist any other individual, person, firm or other entity in soliciting or servicing any Customer for the purpose of providing and/or selling any products that are provided and/or sold by the Company or its Affiliates, or performing any services that are performed by the Company or its Affiliates, (B) interfere with or damage (or attempt to interfere with or damage) any relationship and/or agreement between the Company or its Affiliates and any Customer or (C) associate (including, but not limited to, association as a sole proprietor, owner, employer, partner, principal, investor, joint venturer, shareholder, associate, employee, member, consultant, contractor, director or otherwise) with any Competitive Enterprise; provided, however, that the Participant may own, as a passive investor, securities of any such entity that has outstanding publicly traded securities so long as his/her direct holdings in any such entity shall not in the aggregate constitute more than one percent (1%) of the voting power of such entity. The Participant agrees that, before providing services, whether as an employee or consultant, to any entity during the Non-Compete Period, he/she will provide a copy of this Agreement to such entity, and shall cause such entity to acknowledge to the Company in writing that it has read this Agreement. The Participant acknowledges that this covenant has a unique, very substantial and immeasurable value to the Company, that the Participant has sufficient assets and skills to provide a livelihood for the Participant while such covenant remains in force and that, as a result of the foregoing, in the event that the Participant breaches such covenant, monetary damages would be an insufficient remedy for the Company and equitable enforcement of the covenant would be proper.

(ii) If the restrictions contained in Section 7(e)(i) shall be determined by any court of competent jurisdiction to be unenforceable in whole or in part, Section 7(e)(i) shall be modified to be effective for the maximum period of time for which it may be enforceable and over the maximum geographical area as to which it may be enforceable and to the maximum extent in all other respects as to which it may be enforceable.

(f)Conflicting Obligations and Rights. The Participant agrees to inform the Company of any apparent conflicts between the Participant’s work for the Company or its Affiliates and any obligations the Participant may have to preserve the confidentiality of another’s proprietary information or related materials before using the same on the Company’s behalf. The Company shall receive such disclosures in confidence and consistent with the objectives of avoiding any conflict of obligations and rights or the appearance of any conflict of interest.

(g)Enforcement. The Participant acknowledges that in the event of any breach or threatened breach of this Section 7, the business interests of the Company and its Affiliates will be irreparably injured, the full extent of the damages to the Company and its Affiliates will be impossible to ascertain, monetary damages will not be an adequate remedy for the Company and its Affiliates, and the Company will be entitled to enforce this Agreement by a temporary, preliminary and/or permanent injunction or other equitable relief, without the necessity of posting bond or security, which the Participant expressly waives. The Participant understands that the Company may, in its sole discretion, waive any of the requirements expressed in this Agreement, but that, for such a waiver to be effective, it must be made in writing and shall not in any way be deemed a waiver of the Company’s right to enforce any other requirements or provisions of this Agreement. The Participant agrees that each of the Participant’s obligations specified in this Agreement is a separate and independent covenant and that the unenforceability of any of them shall not preclude the enforcement of any other covenants in this Agreement.

8.Non-transferability.

(a)Restriction on Transfers. Except as provided in Section 8(b)below, all PRSUs, and any rights or interests therein, (i) shall not be sold, exchanged, transferred, assigned or otherwise disposed of in any way at any time by the Participant (or any beneficiary(ies) of the Participant), other than by testamentary disposition by the Participant or by the laws of descent and distribution, (ii) shall not be pledged or encumbered in any way at any time by the Participant (or any beneficiary(ies) of the Participant) and (iii) shall not be subject to execution, attachment or similar legal process. Any attempt to sell, exchange, pledge, transfer, assign, encumber or otherwise dispose of these PRSUs, or the levy of any execution, attachment or similar legal process upon PRSUs contrary to the terms of this Agreement and/or the Plan shall be null and void and without legal force or effect.

(b)Permissible Transfers. During the Participant’s lifetime, the Participant may, with the consent of the Committee, transfer without consideration all or any portion of PRSUs granted under this Agreement to one or more Family Members, to a trust established for the exclusive benefit of one or more Family Members, to a partnership in which all the partners are Family Members, or to a limited liability company in which all the members are Family Members.

9.Entire Agreement; Amendment. This Agreement, together with the Plan contains the entire agreement between the parties hereto with respect to the subject matter contained herein, and supersedes all prior agreements or prior understandings, whether written or oral, between the parties relating to such subject matter. The Committee shall have the right, in its sole discretion, to modify or amend this Agreement from time to time in accordance with and as provided in the Plan. This Agreement may also be modified or amended by a writing signed by both the Company and the Participant. The Company shall give written notice to the Participant of any such modification or amendment of this Agreement as soon as practicable after the adoption thereof.

10.Acknowledgment of Participant. This award of PRSUs does not entitle the Participant to any benefit other than that granted under this Agreement. Any benefits granted under this Agreement are not part of the Participant’s ordinary salary and shall not be considered as part of such salary in the event of severance, redundancy or resignation.

11.Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Florida, without reference to the principles of conflict of laws thereof.

12.Withholding of Tax. As a condition to the (a) vesting of the PRSUs or (b) distribution of shares of Common Stock to the Participant, in both instances, as applicable, the Participant shall be required to pay in cash, or to make other arrangements satisfactory to the Company to cover, the minimum amount of any federal, provincial, state, local and foreign tax withholdings or other obligation of any kind (including, but not limited to, the Participant’s FICA and SDI obligations) that the Company, in its sole discretion, deems necessary to comply with the Code and/or any other applicable law, rule or regulation with respect to the PRSUs (the “Withholdings”). Without limiting the foregoing, the Company, in its sole discretion, may (i) permit or require the Participant to satisfy such Withholdings by having shares of Common Stock withheld by the Company from any shares of Common Stock that would have otherwise been delivered to the Participant in respect of the PRSUs hereunder and/or (ii) permit the Participant to also satisfy any federal, provincial, state, local and foreign tax obligations arising from the vesting or settlement of the PRSUs that are in excess of the Withholdings by having shares of Common Stock withheld by the Company from any shares of Common Stock that would have otherwise been delivered to the Participant in respect of the PRSUs hereunder, in an amount up to the maximum individual statutory rate for each applicable jurisdiction. Further, at the Company’s sole discretion, the Company can mandate that the Participant satisfy all or part of its obligations to pay the Withholdings by the sale of shares of Common Stock through a broker designated by the Company, and require that the proceeds of the sale be conveyed by the broker directly to the Company.  If the Company makes this election, the Company in its sole discretion can further require the Participant to enter into a trading plan designed to be compliant with Rule 10b5-1 under the Exchange Act so as to permit the sale of such shares of Common Stock during periods where trading by the Participant would otherwise be restricted.

13.No Right to Employment. Any questions as to whether and when there has been a Termination of such employment and the cause of such Termination shall be determined in the sole discretion of the Committee. Nothing in this Agreement shall interfere with or limit in any way the right of the Company or its Affiliates to terminate the Participant’s employment or service at any time, for any reason and with or without Cause.

14.Notices. Any notice that may be required or permitted under this Agreement shall be in writing and shall be delivered in person or via facsimile transmission, overnight courier service or certified mail, return receipt requested, postage prepaid, properly addressed as follows:

(a)If such notice is to the Company, to the attention of the General Counsel of the Company or at such other address as the Company, by notice to the Participant, shall designate in writing from time to time.

(b)If such notice is to the Participant, at his/her address as shown on the Company’s records, or at such other address as the Participant, by notice to the Company, shall designate in writing from time to time.

15.Transfer of Personal Data. The Participant authorizes, agrees and unambiguously consents to the transmission by the Company (or any Affiliate) of any personal data information related to the PRSUs awarded under this Agreement for legitimate business purposes (including, without limitation, the administration of the Plan). This authorization and consent is freely given by the Participant.

16.Compliance with Laws. This issuance of PRSUs (and the shares of Common Stock underlying the PRSUs) pursuant to this Agreement shall be subject to, and shall comply with, any applicable requirements of any foreign and U.S. federal and state securities laws, rules and regulations (including, without limitation, the provisions of the Securities Act and the Exchange Act and in each case any respective rules and regulations promulgated thereunder) and any other law or regulation applicable thereto. The Company shall not be obligated to issue PRSUs or any of the shares of Common Stock pursuant to this Agreement if any such issuance would violate any such requirements.

17.Binding Agreement; Assignment. This Agreement shall inure to the benefit of, be binding upon and be enforceable by the Company and its successors and assigns. The Participant shall not assign (except as permitted under Section 8 hereof) any part of this Agreement without the prior express written consent of the Company.

18.Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original, but all of which shall constitute one and the same instrument.

19.Headings. The titles and headings of the various sections of this Agreement have been inserted for convenience of reference only and shall not be deemed to be a part of this Agreement.

20.Further Assurances. Each party hereto shall do and perform (or shall cause to be done and performed) all such further acts and shall execute and deliver all such other agreements, certificates, instruments and documents as either party hereto reasonably may request in order to carry out the intent and accomplish the purposes of this Agreement and the Plan and the consummation of the transactions contemplated thereunder.

21.Severability. The invalidity or unenforceability of any provisions of this Agreement, including, without limitation Section 7, in any jurisdiction shall not affect the validity, legality or enforceability of the remainder of this Agreement in such jurisdiction or the validity, legality or enforceability of any provision of this Agreement in any other jurisdiction, it being intended that all rights and obligations of the parties hereunder shall be enforceable to the fullest extent permitted by law.

22.Compensatory Arrangements. The Company and the Participant hereby acknowledge and agree that this Agreement has been executed and delivered, and PRSUs, and the shares of Common Stock delivered upon settlement, have been issued hereunder, in connection with and as a part of the compensation and incentive arrangements between the Company and its Affiliates, on the one hand, and the Participant, on the other hand.

23.Definitions. Any capitalized term not defined in this Agreement shall have the same meaning as is ascribed thereto in the Plan. For purposes of this Agreement, the following words and phrases shall have the following meanings, unless a different meaning is plainly required by the context:

(a) “Competitive Enterprise” means a business enterprise that engages in, or owns or controls a significant interest in any entity that engages in the sale or manufacture of entryway doors or door components or other products that are manufactured and sold by the Company and its Subsidiaries, during the time the Participant was employed by the Company or its Subsidiaries, and does business (the “Company’s Business”)(i) in the United States of America, (ii) Canada or (iii) any other country where the Company or its Subsidiaries operates facilities or sells products, but only if the Participant had operational, financial reporting, marketing or other responsibility or oversight for the facility or business in the respective country. Notwithstanding the foregoing, in the event that a business enterprise has one or more lines of business that do not involve the Company’s Business, the Participant shall be permitted to associate with such business enterprise if, and only if, the Participant does not participate in, or have supervisory authority with respect to, any line of business involving the Company’s Business.

(b) “Confidential Information” means all non-public information concerning trade secrets, know-how, software, developments, inventions, processes, technology, designs, financial data, strategic business plans or any proprietary or confidential information, documents or materials in any form or media, including any of the foregoing relating to research, operations, finances, current and proposed products and services, vendors, customers, advertising and marketing, and other non-public, proprietary, and confidential information of the Company or its Affiliates. Notwithstanding anything to the contrary contained herein, the general skills, knowledge and experience gained during the Participant’s employment or service with the Company, information publicly available or generally known within the industry or trade in which the Company competes and information or knowledge possessed by the Participant prior to his/her employment by the Company, shall not be considered Confidential Information.

(c) “Customer” means any person, firm, corporation or other entity whatsoever to whom the Company or its Subsidiaries provided services or sold any products to within a twelve (12) month period on, before or after the Participant’s date of Termination.

(d)“Detrimental Misconduct” means (i) conduct which is injurious to the Company or its business or reputation, involving a material breach of Company policy, or applicable laws or regulations to which the Participant is subject, or an agreement between the Company and the Participant, or (ii) any other action (or failure to act) involving illegal acts, theft, fraud, intentional misconduct, or gross negligence on the part of the Participant, related to his or her position with the Company.

(e)“Financial Misconduct” means fraud, gross negligence or intentional or willful misconduct that contributes, directly or indirectly, to the Company’s financial or operational results that are used to determine the extent to which any award of cash or stock under the Plan being misstated, regardless of whether the Company is required to prepare an accounting restatement of its consolidated financial statements, which is discovered during the relevant year in which such award is awarded or payable or within three years thereafter.

(f)“Good Reason” means (i) in the event the Participant is a party to an Employment Agreement between the Participant and the Company or its Affiliates in effect on the Participant’s date of Termination (the “Employment Agreement”), “Good Reason” as defined under the Employment Agreement as in effect on the Participant’s date of Termination; or (ii) in the event the Participant is not a party to an Employment Agreement as in effect on the Participant’s date of Termination, “Good Reason” shall mean “Good Reason” as determined by the Committee, in its sole discretion.

(g) “Non-Compete Period” means (i) in the event the Participant is a party to an Employment Agreement in effect on the Participant’s date of Termination, the period during which the Participant is subject to the non-competition covenant set forth in the Employment Agreement or (ii) if the Employment Agreement is not in effect on the Participant’s date of Termination or if the Participant is not a party to the Employment Agreement or such Employment Agreement does not contain a non-competition covenant, “Non-Compete Period” shall mean the period commencing on the Grant Date and ending twelve (12) months after the Participant’s date of Termination, or (iii) if after Termination of employment, the Participant enters into a consulting agreement the “Non-Compete Period” shall mean the period commencing on the Grant Date and ending twelve (12) months after the termination of the consulting arrangement unless the consulting agreement specifies a different time period.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

MASONITE INTERNATIONAL CORPORATION

By:

Name: Howard C. Heckes

Title: President and Chief Executive Officer

PARTICIPANT

Name: ______________________________

EXHIBIT “A”

To February 27, 2023 Performance-Vesting Restricted Stock Unit (PSU) Grant

The following two performance metrics will be used to calculate the number of PSUs that vest with respect to the PSU grant made February 27, 2023. Each metric will be weighted at 50%.

(a) Net Sales in 2025

Performance Achievement
•	Threshold	= $3.3B	[50% achievement]
•	Target	= $3.5B	[100% achievement]
•	Maximum	= $4.0B	[200% achievement]

(b) Total Shareholder Return (TSR) vs. Compensation Peer Group TSR for 2023-25

Performance Achievement
•	Floor	= Below 25th percentile	[0% achievement]
•	Threshold	= At 25th percentile	[50% achievement]
•	Target	= At 50th percentile	[100% achievement]
•	Maximum	= At or above 75th percentile	[200% achievement]

Net Sales – as reported externally, subject to the following adjustments:

•FX adjustments to plan year AOP rates

•Changes in accounting principles

•Other adjustments as approved by the HR and Compensation Committee

Total Shareholder Return (TSR) = ([average of the closing stock price for the last 20 trading days of 2025 minus average of the closing stock price for the first 20 trading days in 2023] plus dividends paid {as applicable} during 2023-2025) divided by the average of the closing price for the first 20 trading days in 2023

•For purposes of LTIP calculations, Net Sales from an acquired business during the measurement year will be included in actual results.

•For purposes of LTIP calculations, Net Sales from a divested business will be excluded from actual results for the year in which the transaction occurs. A divested business is one for which the gain or loss recorded on the divestiture transaction(s) will be reported within the caption “(Gain) loss on disposal of subsidiaries” as determined by Corporate Accounting.

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Howard C. Heckes, certify that:

1.I have reviewed this quarterly report on Form 10-Q for the quarter ended April 2, 2023, of Masonite International Corporation;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements and other financial information included in this report fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected or is reasonably likely to materially affect the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

Date:	May 9, 2023
	/s/ Howard C. Heckes
	Howard C. Heckes
	President and Chief Executive Officer
	(Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Russell T. Tiejema, certify that:

1.I have reviewed this quarterly report on Form 10-Q for the quarter ended April 2, 2023, of Masonite International Corporation;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements and other financial information included in this report fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected or is reasonably likely to materially affect the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

Date:	May 9, 2023
	/s/ Russell T. Tiejema
	Russell T. Tiejema
	Executive Vice President and Chief Financial Officer
	(Principal Financial Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Howard C. Heckes, President and Chief Executive Officer of Masonite International Corporation (the "Company"), do hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1.The Quarterly Report on Form 10-Q of the Company for the quarter ended April 2, 2023 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m); and

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	May 9, 2023
	/s/ Howard C. Heckes
	Howard C. Heckes
	President and Chief Executive Officer
	(Principal Executive Officer)

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Russell T. Tiejema, Executive Vice President and Chief Financial Officer of Masonite International Corporation (the "Company"), do hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1.The Quarterly Report on Form 10-Q of the Company for the quarter ended April 2, 2023 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m); and

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	May 9, 2023
	/s/ Russell T. Tiejema
	Russell T. Tiejema
	Executive Vice President and Chief Financial Officer
	(Principal Financial Officer)

XML

Cover Page - shares	3 Months Ended
	Apr. 02, 2023	May 05, 2023
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Apr. 02, 2023
Document Transition Report	false
Entity File Number	001-11796
Entity Registrant Name	Masonite International Corporation
Entity Tax Identification Number	98-0377314
Entity Address, Address Line One	2771 Rutherford Road
Entity Address, City or Town	Concord
Entity Address, State or Province	ON
Entity Address, Postal Zip Code	L4K 2N6
Entity Address, Country	CA
City Area Code	800
Local Phone Number	895-2723
Title of 12(b) Security	Common Stock (no par value)
Trading Symbol	DOOR
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		22,112,520
Entity Central Index Key	0000893691
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q1
Amendment Flag	false
Entity Incorporation, State or Country Code	A1

XML

Condensed Consolidated Statements of Income and Comprehensive Income (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Apr. 02, 2023	Apr. 03, 2022
Statement of Comprehensive Income [Abstract]
Net sales	$ 725,984	$ 726,217
Cost of goods sold	555,493	541,968
Gross profit	170,491	184,249
Selling, general and administration expenses	101,705	83,246
Restructuring costs (benefit)	3,678	(19)
Operating income	65,108	101,022
Interest expense, net	14,252	10,239
Other expense (income), net	52	(1,415)
Income before income tax expense	50,804	92,198
Income tax expense	11,360	23,477
Net income	39,444	68,721
Less: net income attributable to non-controlling interests	953	1,139
Net income attributable to Masonite	$ 38,491	$ 67,582
Basic earnings per common share attributable to Masonite (in dollars per share)	$ 1.74	$ 2.93
Diluted earnings per common share attributable to Masonite (in dollars per share)	$ 1.71	$ 2.89
Comprehensive income:
Net income	$ 39,444	$ 68,721
Other comprehensive income (loss):
Foreign currency translation gain (loss)	8,949	(2,105)
Amortization of actuarial net losses	191	6
Income tax (expense) benefit related to other comprehensive income (loss)	(45)	10
Other comprehensive gain (loss), net of tax	9,095	(2,089)
Comprehensive income	48,539	66,632
Less: comprehensive income attributable to non-controlling interests	945	1,281
Comprehensive income attributable to Masonite	$ 47,594	$ 65,351

XML

Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Apr. 02, 2023	Jan. 01, 2023
Current assets:
Cash and cash equivalents	$ 210,725	$ 296,922
Restricted cash	11,587	11,999
Accounts receivable, net	391,559	375,918
Inventories, net	418,581	406,828
Prepaid expenses and other assets	52,280	55,051
Income taxes receivable	18,433	16,922
Total current assets	1,103,165	1,163,640
Property, plant and equipment, net	714,259	652,329
Operating lease right-of-use assets	165,869	160,695
Investment in equity investees	19,924	16,111
Goodwill	257,977	69,868
Intangible assets, net	266,658	136,056
Deferred income taxes	19,156	16,133
Other assets	34,049	33,346
Total assets	2,581,057	2,248,178
Current liabilities:
Accounts payable	123,768	111,526
Accrued expenses	193,642	223,046
Income taxes payable	8,329	14,361
Total current liabilities	325,739	348,933
Long-term debt	1,113,880	866,116
Long-term operating lease liabilities	155,993	151,242
Deferred income taxes	128,292	79,590
Other liabilities	76,429	59,515
Total liabilities	1,800,333	1,505,396
Commitments and Contingencies (Note 7)
Equity:
Share capital: unlimited shares authorized, no par value, 22,138,282 and 22,155,035 shares issued and outstanding as of April 2, 2023, and January 1, 2023, respectively	529,156	520,003
Additional paid-in capital	218,010	226,514
Retained earnings	155,625	127,826
Accumulated other comprehensive loss	(133,121)	(142,224)
Total equity attributable to Masonite	769,670	732,119
Equity attributable to non-controlling interests	11,054	10,663
Total equity	780,724	742,782
Total liabilities and equity	$ 2,581,057	$ 2,248,178

XML

Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - shares	Apr. 02, 2023	Jan. 01, 2023
Statement of Financial Position [Abstract]
Shares issued (in shares)	22,138,282	22,155,035
Shares outstanding (in shares)	22,138,282	22,155,035

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Condensed Consolidated Statements of Changes in Equity (Unaudited) - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Loss	Equity Attributable to Noncontrolling Interests
Balance at beginning of period at Jan. 02, 2022	$ 699,778	$ 543,400	$ 222,177	$ 24,244	$ (101,582)	$ 11,539
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Common shares issued for delivery of share based awards		11,630	(11,630)
Common shares issued under employee stock purchase plan		797	(134)
Common shares repurchased		28,441	17,710	93,849
Share based compensation expense			4,719
Common shares withheld to cover income taxes payable due to delivery of share based awards			(2,963)
Net income	68,721			67,582		1,139
Other comprehensive income (loss), net of tax	(2,089)				(3,228)	142
Dividends to non-controlling interests						(1,385)
Balance at end of period at Apr. 03, 2022	626,447	$ 527,386	194,459	(2,023)	(104,810)	11,435
Balance at beginning of period (in shares) at Jan. 02, 2022		23,623,887
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Common shares issued for delivery of share based awards (in shares)		169,370
Common shares issued under employee stock purchase plan (in shares)		8,029
Common shares repurchased (in shares)		(1,236,330)
Balance at end of period (in shares) at Apr. 03, 2022		22,564,956
Balance at beginning of period at Jan. 01, 2023	742,782	$ 520,003	226,514	127,826	(142,224)	10,663
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Common shares issued for delivery of share based awards		12,372	(12,372)
Common shares issued under employee stock purchase plan		806	(226)
Common shares repurchased		4,025	0	10,692
Share based compensation expense			6,054
Common shares withheld to cover income taxes payable due to delivery of share based awards			(1,960)
Net income	39,444			38,491		953
Other comprehensive income (loss), net of tax	9,095				9,103	(8)
Dividends to non-controlling interests						(554)
Balance at end of period at Apr. 02, 2023	$ 780,724	$ 529,156	$ 218,010	$ 155,625	$ (133,121)	$ 11,054
Balance at beginning of period (in shares) at Jan. 01, 2023	22,155,035	22,155,035
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Common shares issued for delivery of share based awards (in shares)		142,943
Common shares issued under employee stock purchase plan (in shares)		8,827
Common shares repurchased (in shares)		(168,523)
Balance at end of period (in shares) at Apr. 02, 2023	22,138,282	22,138,282

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Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Apr. 02, 2023	Apr. 03, 2022
Cash flows from operating activities:
Net income	$ 39,444	$ 68,721
Adjustments to reconcile net income to net cash flow provided by (used in) operating activities:
Depreciation	21,485	17,272
Amortization	7,421	4,612
Share based compensation expense	6,054	4,719
Deferred income taxes	885	7,027
Unrealized foreign exchange (gain) loss	(97)	594
Share of income from equity investees, net of tax	(748)	(1,687)
Pension and post-retirement funding, net of expense	(509)	(114)
Non-cash accruals and interest	1,445	(304)
Loss (gain) on sale of property, plant and equipment	1,038	(2,854)
Changes in assets and liabilities, net of acquisitions:
Accounts receivable	(5,457)	(64,948)
Inventories	34,024	(58,106)
Prepaid expenses and other assets	(7,730)	(387)
Accounts payable and accrued expenses	(33,223)	(11,294)
Other assets and liabilities	(7,685)	(1,100)
Net cash flow provided by (used in) operating activities	56,347	(37,849)
Cash flows from investing activities:
Additions to property, plant and equipment	(27,827)	(19,095)
Acquisition of businesses, net of cash acquired	(353,618)	0
Proceeds from sale of property, plant and equipment	4	6,393
Proceeds from repayment of note receivable	12,000	0
Other investing activities	(3,511)	(588)
Net cash flow used in investing activities	(372,952)	(13,290)
Cash flows from financing activities:
Proceeds from issuance of long-term debt	250,000	0
Payment of debt issuance costs	(3,628)	0
Proceeds from borrowings on revolving credit facilities	100,000	0
Repayments of borrowings on revolving credit facilities	(100,000)	0
Tax withholding on share based awards	(1,960)	(2,963)
Distributions to non-controlling interests	(554)	(1,385)
Repurchases of common shares	(14,717)	(140,000)
Net cash flow provided by (used in) financing activities	229,141	(144,348)
Net foreign currency translation adjustment on cash	855	(1,394)
Decrease in cash, cash equivalents and restricted cash	(86,609)	(196,881)
Cash, cash equivalents and restricted cash, beginning of period	308,921	391,505
Cash, cash equivalents and restricted cash, at end of period	$ 222,312	$ 194,624

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Business Overview and Significant Accounting Policies

3 Months Ended

Apr. 02, 2023

Accounting Policies [Abstract]

Business Overview and Significant Accounting Policies

Business Overview and Significant Accounting Policies

Unless we state otherwise or the context otherwise requires, references to "Masonite," "we," "our," "us" and the "Company" in these notes to the condensed consolidated financial statements refer to Masonite International Corporation and its subsidiaries.

Description of Business

Masonite International Corporation is one of the largest manufacturers of doors in the world, with significant market share in both interior and exterior door products. Masonite operates 63 manufacturing locations in seven countries and sells doors to customers throughout the world with our largest markets being the United States, Canada and the United Kingdom.

Basis of Presentation

We prepare these unaudited condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States of America ("GAAP") and applicable rules and regulations of the U.S. Securities and Exchange Commission ("SEC") regarding interim financial reporting. Accordingly, they do not include all of the information and notes required by GAAP for annual financial statements. In the opinion of management, all adjustments consisting of normal and recurring entries considered necessary for a fair presentation of the results for the interim periods presented have been included. All significant intercompany balances and transactions have been eliminated. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect reported amounts in the financial statements and accompanying notes. These estimates are based on information available as of the date of the unaudited condensed consolidated financial statements; therefore, actual results could differ from those estimates. Interim results are not necessarily indicative of the results for a full year.

These unaudited condensed consolidated financial statements should be read in conjunction with the Company's Annual Report on Form 10-K for the fiscal year ended January 1, 2023, as filed with the SEC (the "Annual Report"). Our fiscal year is the 52- or 53-week period ending on the Sunday closest to December 31. In a 52-week year, each fiscal quarter consists of 13 weeks. For ease of disclosure, the 13-week periods are referred to as three-month periods and the 52- or 53-week periods are referred to as a year.

Changes in Accounting Standards and Policies

There have been no changes in the significant accounting policies from those that were disclosed in the fiscal year 2022 audited consolidated financial statements, other than as noted below.

Adoption of Recent Accounting Pronouncements

In December 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2021-10, "Government Assistance," which requires annual disclosures that increase the transparency of transactions involving government grants, including (1) the types of transactions, (2) the accounting for those transactions and (3) the effect of those transactions on an entity's financial statements. The guidance is effective for annual periods beginning after December 15, 2021, with early adoption permitted. We adopted the new guidance as of January 3, 2022, the beginning of fiscal year 2022, and the adoption did not have a material impact on our financial statements.

In October 2021, the FASB issued ASU 2021-08, "Accounting for Contract Assets and Contract Liabilities from Contracts with Customers," which clarifies that an acquirer of a business should recognize and measure contract assets and contract liabilities in a business combination in accordance with ASU 2014-09, "Revenue from Contracts with Customers" as if the entity had originated the contracts. We adopted the new guidance as of January 1, 2023, the beginning of fiscal year 2023, and the adoption did not have a material impact on our financial statements.

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Acquisitions and Divestitures

3 Months Ended

Apr. 02, 2023

Business Combination and Asset Acquisition [Abstract]

Acquisitions and Divestitures

Acquisitions and Divestitures

Acquisitions

On January 3, 2023, we completed the acquisition of 100% of the outstanding equity of EPI Holdings, Inc. ("Endura"), for total consideration of approximately $408.1 million, including an $18.0 million holdback which is payable 24 months after the acquisition date. Endura is a leading innovator and manufacturer of high-performance door frames and door system components in the United States. Endura’s product offerings include engineered frames, self-adjusting sill systems, weather sealing, multi-point locks and installation accessories used by builders and contractors in residential new construction as well as repair and remodeling applications. The acquisition is intended to accelerate our Doors That Do MoreTM strategy and maximize our growth potential. The $189.9 million excess purchase price over the fair value of tangible and intangible assets acquired was allocated to goodwill. The goodwill principally represents anticipated synergies to be gained from the integration into our existing business and acquisition of the assembled workforce. This goodwill is not deductible for tax purposes and relates to the North American Residential segment.

The Company has accounted for the acquisition as a business combination and allocated the preliminary estimated purchase price to the estimated fair values of assets acquired and liabilities assumed utilizing various valuation methods including replacement cost, market values and the income approach. The Company has not yet completed its evaluation and determination of certain assets acquired and liabilities assumed, primarily (i) the final valuation of intangible assets related to customers relationships and trade names, and (ii) the final assessment and valuation of certain other assets acquired and liabilities assumed, including inventory, property, plant and equipment, leases, and deferred income taxes, which could also impact goodwill during the measurement period.

The allocation of the purchase price to assets acquired and liabilities assumed is as follows:

(In thousands)	Endura
Cash acquired	$	32,501
Accounts receivable, net	7,871
Inventories, net	44,183
Property, plant and equipment, net	54,373
Goodwill	189,938
Intangible assets	135,800
Accounts payable and accrued expenses	(15,088)
Deferred income taxes	(44,345)
Other assets and liabilities, net	2,868
Total purchase price	$	408,101

The fair values of intangible assets acquired are based on management's estimates and assumptions including the income approach, the cost approach and the market approach. The intangible assets acquired are not expected to have any residual value. The gross contractual value of acquired trade receivables was $8.3 million.

Intangible assets acquired from the Endura acquisition consist of the following:

	Fair Value  (in thousands)		Expected Useful Life (Years)
Customer relationships	$	116,000	10
Trademarks and trade names	6,600		10
Patents	13,200		12
Total intangible assets acquired	$	135,800

Endura's results of operations were included in the condensed consolidated statements of income and comprehensive income for the period subsequent to the acquisition date. For the three months ended April 2, 2023, Endura had $59.8 million in net sales and $4.5 million in net loss attributable to Masonite.

Pro Forma Information

The following unaudited pro forma financial information represents the consolidated financial information as if the Endura acquisition had been included in our consolidated results beginning on January 2, 2022, the first day of the fiscal year prior to the respective acquisition date. The pro forma results have been calculated after adjusting the results of the acquired entities to remove intercompany transactions and to reflect the additional depreciation, amortization and interest expense that would have been charged assuming the fair value adjustments to property, plant and equipment and intangible assets and the additional debt incurred to fund the acquisition had been applied on the first day of the fiscal year prior to the respective acquisition, together with the consequential tax effects. The pro forma results do not reflect any cost savings, operating synergies or revenue enhancements that the combined company may achieve as a result of the acquisitions; the costs to combine the companies' operations; or the costs necessary to achieve these costs savings, operating synergies and revenue enhancements. As a result, the pro forma information below does not purport to present what actual results would have been had the acquisition been consummated on the date indicated and it is not necessarily indicative of future results of operations.

	Three Months Ended April 3, 2022
(In thousands)	Masonite		Endura		Pro Forma Adjustments		Pro Forma
Net sales	$	726,217	$	72,716	$	(2,604)	$	796,329
Net income attributable to Masonite	67,582		3,353		(5,881)		65,054
Basic earnings per common share	$	2.93					$	2.82
Diluted earnings per common share	$	2.89					$	2.78

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Accounts Receivable

3 Months Ended

Apr. 02, 2023

Receivables [Abstract]

Accounts Receivable

Accounts Receivable

Our customers consist mainly of retailers, distributors and contractors. Our ten largest customers accounted for 59.3% and 62.3% of total accounts receivable as of April 2, 2023, and January 1, 2023, respectively. Our largest customer, The Home Depot, Inc., accounted for more than 10% of the consolidated gross accounts receivable balance as of April 2, 2023, and January 1, 2023. The allowance for doubtful accounts balance was $2.9 million and $2.5 million as of April 2, 2023, and January 1, 2023, respectively.

We maintain an accounts receivable sales program with a third party (the "AR Sales Program"). Under the AR Sales Program, we can transfer ownership of eligible trade accounts receivable of certain customers. Receivables are sold outright to a third party who assumes the full risk of collection, without recourse to us in the event of a loss. Transfers of receivables under this program are accounted for as sales. Proceeds from the transfers reflect the face value of the accounts receivable less a discount. Receivables sold under the AR Sales Program are excluded from trade accounts receivable in the condensed consolidated balance sheets and are included in cash flows from operating activities in the condensed consolidated statements of cash flows. The discounts on the sales of trade accounts receivable sold, if any,

under the AR Sales Program were not material for any of the periods presented and were recorded in selling, general and administration expenses within the condensed consolidated statements of income and comprehensive income.

In most countries we pay and collect Value Added Tax ("VAT") when procuring goods and services within the normal course of business. VAT receivables are established in jurisdictions where VAT paid exceeds VAT collected and are recoverable through the filing of refund claims.

Certain wood moldings and millwork products being imported into the U.S. are subject to import tariffs. Tariff deposits are paid to the government and are recoverable through an assessment process.

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Inventories

3 Months Ended

Apr. 02, 2023

Inventory Disclosure [Abstract]

Inventories

InventoriesThe amounts of inventory on hand were as follows as of the dates indicated:

(In thousands)	April 2, 2023		January 1, 2023
Raw materials	$	288,385	$	320,553
Finished goods	143,322		95,005
Provision for obsolete or aged inventory	(13,126)		(8,730)
Inventories, net	$	418,581	$	406,828

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Accrued Expenses

3 Months Ended

Apr. 02, 2023

Accrued Expenses [Abstract]

Accrued Expenses

Accrued ExpensesThe details of our accrued expenses were as follows as of the dates indicated:

(In thousands)	April 2, 2023		January 1, 2023
Accrued payroll	$	57,084	$	69,224
Accrued rebates	49,410		50,200
Current portion of operating lease liabilities	24,492		24,372
Accrued interest	8,142		16,480
Other accruals	54,514		62,770
Total accrued expenses	$	193,642	$	223,046

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Long-Term Debt

3 Months Ended

Apr. 02, 2023

Debt Disclosure [Abstract]

Long-Term Debt

Long-Term Debt

(In thousands)	April 2, 2023		January 1, 2023
Senior unsecured notes, interest rate of 3.50%, due 2030	$	375,000	$	375,000
Senior unsecured notes, interest rate of 5.375%, due 2028	500,000		500,000
Term Loan Facility, interest rate of SOFR plus 2.25%, due 2027	250,000		—
Debt issuance costs	(11,120)		(8,884)
Total long-term debt	$	1,113,880	$	866,116

Interest expense related to our consolidated indebtedness under our senior unsecured notes, Term Loan Facility and ABL Facility was $15.4 million and $10.3 million for the three months ended April 2, 2023 and April 3, 2022, respectively.

3.50% Senior Notes due 2030

On July 26, 2021, we issued $375.0 million aggregate principal senior unsecured notes (the "2030 Notes"). The 2030 Notes bear interest at 3.50% per annum, payable in cash semiannually in arrears on February 15 and August 15 of each year and are due February 15, 2030. The 2030 Notes were issued at par.

Information concerning obligations under the 2030 Notes and the indenture governing them are described in detail in our Annual Report. As of April 2, 2023, we were in compliance with all covenants under the indenture governing the 2030 Notes.

5.375% Senior Notes due 2028

On July 25, 2019, we issued $500.0 million aggregate principal senior unsecured notes (the "2028 Notes"). The 2028 Notes bear interest at 5.375%, payable in cash semiannually in arrears on February 1 and August 1 of each year and are due February 1, 2028. The 2028 Notes were issued at par.

Information concerning obligations under the 2028 Notes and the indenture governing them are described in detail in our Annual Report. As of April 2, 2023, we were in compliance with all covenants under the indenture governing the 2028 Notes.

Term Loan Facility

On December 13, 2022, we and certain of our subsidiaries entered into a new delayed-draw term loan credit agreement (the "Term Loan Credit Agreement") maturing on December 12, 2027 (the "Term Loan Maturity Date"). The Term Loan Credit Agreement provides for a senior secured five-year delayed-draw term loan facility of $250.0 million (the "Term Loan Facility"). Loans under the Term Loan Facility (the "Term Loans") will bear interest at a rate equal to, at our option, (1) the Adjusted Term SOFR Rate (as defined in the Term Loan Credit Agreement) plus an applicable margin of 2.25% or (2) an alternate base rate equal to the greatest of (i) the "Prime Rate" in the U.S. last quoted by The Wall Street Journal, (ii) 0.50% above the greater of the federal funds rate and the rate comprised of both overnight federal funds and overnight eurodollar transactions denominated in U.S. dollars, (iii) 1.00% above the Adjusted Term SOFR Rate for a one month interest period and (iv) 1.00%, plus, in each case, an applicable margin of 1.25%, subject to, in each of cases (1) and (2), an agreed interest rate floor. The Term Loans are repayable in equal quarterly installments for an annual aggregate amortization payment equal to 15% of the aggregate principal amount of the Term Loans, with the balance of the principal being due on the Term Loan Maturity Date.

The Term Loan Credit Agreement also includes a quarterly ticking fee of 25 basis points per annum payable to the lenders under the Term Loan Facility beginning on January 3, 2023 (the "Closing Date") in respect of the unutilized commitments thereunder. As a result of the incurrence of the Term Loans on the Closing Date such ticking fees were not (and shall not be) payable to the Lenders.

The Borrower also pays customary agency fees.

Obligations under the Term Loan Credit Agreement are fully and unconditionally guaranteed, jointly and severally, by us and by certain of our directly or indirectly wholly-owned subsidiaries organized in the United States and are secured by the equity in, and substantially all the assets of, such subsidiaries. The Term Loans were funded in an amount of $250.0 million and applied to finance a portion of the consideration payable in connection with the consummation of the Endura acquisition on January 3, 2023. We received net proceeds of $246.4 million after deducting $3.6 million of debt issuance costs. The debt issuance costs were capitalized as a reduction to the carrying value of debt and are being accreted to interest expense over the term of the loan using the effective interest method.

The Term Loan Credit Agreement contains various customary representations, warranties by us and covenants that are described in detail in our Annual Report. As of April 2, 2023, we were in compliance with all covenants under the indenture governing the Term Loan Credit Agreement.

ABL Facility

On January 31, 2019, we and certain of our subsidiaries entered into a $250.0 million asset-based revolving credit facility (the "ABL Facility") maturing on January 31, 2024, which replaced the previous facility. On October 28, 2022, we and certain of our subsidiaries entered into an amendment which, among other things, (i) increased the revolving credit commitments available thereunder by $100.0 million to an aggregate amount of $350.0 million and (ii) replaced the LIBOR-based interest rate applicable to borrowings thereunder in U.S. dollars with an interest rate based on the sum of (x) a "Term SOFR" rate published by the CME Group Benchmark Administration Limited (CBA) plus (y) 10 basis points ("Adjusted Term SOFR"). Additionally, on December 12, 2022, we entered into an amendment to the ABL Facility, which, among other things, extended the maturity of the ABL Facility from January 31, 2024 to December 12, 2027. The terms of the ABL Facility remained otherwise substantially unchanged and are described in detail in our Annual Report. On January 3, 2023, we borrowed $100.0 million under our ABL Facility in order to fund a portion of

the cash consideration paid for the acquisition of Endura. During the first quarter of 2023, we repaid all amounts outstanding under the ABL Facility.

The ABL Facility contains various customary representations, warranties by us and covenants that are described in detail in our Annual Report. As of April 2, 2023, we were in compliance with all covenants under the credit agreement governing the ABL Facility. We had availability of $313.4 million under our ABL Facility and there were no amounts outstanding as of April 2, 2023.

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Commitments and Contingencies

3 Months Ended

Apr. 02, 2023

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

We may become involved from time-to-time in litigation and regulatory compliance matters incidental to our business, including employment and wage and hour claims, antitrust, tax, product liability, environmental, health and safety, commercial disputes, intellectual property, contracts and other matters arising out of the normal conduct of our business. Since litigation is inherently unpredictable and unfavorable resolutions can occur, assessing contingencies is highly subjective and requires judgments about future events. We regularly review and accrue for contingencies related to litigation and regulatory compliance matters, if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Based on current information, in the opinion of management, the ultimate resolution of these matters, individually or in the aggregate, will not have a material adverse effect on our financial condition, results of operations or cash flows.

Antitrust Class Action Proceedings - Canada

On May 19, 2020, an intended class proceeding was commenced in the Province of Québec, Canada naming as defendants Masonite Corporation, Corporation Internationale Masonite, JELD-WEN, Inc., JELD-WEN Holding, Inc. and JELD-WEN of Canada, Ltd. The plaintiff alleges that the Masonite and JELD-WEN defendants engaged in anticompetitive conduct, including price-fixing involving interior molded doors. The intended class proceeding seeks damages, punitive damages, and other relief. On December 22, 2020, the parties filed a motion with the court seeking to stay the proceeding.

On October 2, 2020, an intended class proceeding was commenced in the Federal Court of Canada naming as defendants Masonite International Corporation, Masonite Corporation, JELD-WEN, Inc., JELD-WEN Holding, Inc. and JELD-WEN of Canada, Ltd. The plaintiff alleges that the Masonite and JELD-WEN defendants engaged in anticompetitive conduct, including price-fixing involving interior molded doors. The intended class proceeding seeks damages, punitive damages, and other relief. The plaintiff served its certification record on March 31, 2021. The Federal Court has scheduled a hearing on certification for October 12-13, 2023.

As of April 2, 2023, we have not accrued an expense in connection with this matter because, although an adverse outcome is reasonably possible, the amount or range of any potential loss cannot be reasonably estimated. This proceeding is at an early stage. While we intend to defend against these claims vigorously, there can be no assurance that the ultimate resolution of this litigation will not have a material, adverse effect on our consolidated financial condition, results of operations or cash flow.

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Share Based Compensation Plans

3 Months Ended

Apr. 02, 2023

Share-Based Payment Arrangement [Abstract]

Share Based Compensation Plans

Share Based Compensation Plans

Share based compensation expense was $6.1 million and $4.7 million for the three months ended April 2, 2023 and April 3, 2022, respectively. As of April 2, 2023, the total remaining unrecognized compensation expense related to share based compensation amounted to $47.0 million, which will be amortized over the weighted average remaining requisite service period of 2.1 years.

Equity Incentive Plans

Our equity incentive plans under the 2021 Equity Plan and 2012 Plan are described in detail and defined in our Annual Report. The aggregate number of common shares that can be issued with respect to equity awards under the 2021 Equity Plan cannot exceed 880,000 shares; plus the number of shares reserved for the 2012 Plan that is in excess of the number of shares related to outstanding grants; plus the number of shares subject to existing grants under the 2012 Plan that may expire or be forfeited or cancelled. As of April 2, 2023, there were 583,445 shares of common stock available for future issuance under the 2021 Equity Plan.

Deferred Compensation Plan

We offer to certain of our employees and directors a Deferred Compensation Plan, which is further described and defined in our Annual Report. As of April 2, 2023, the liability and asset relating to deferred compensation had a fair value of $7.1 million and $7.0 million, respectively. As of April 2, 2023, participation in the deferred compensation plan is limited and no restricted stock awards have been deferred into the deferred compensation plan. All plan investments are categorized as having Level 1 valuation inputs as established by the FASB’s Fair Value Framework.

Stock Appreciation Rights

We have granted Stock Appreciation Rights ("SARs") to certain employees, which entitle the recipient to the appreciation in value of granted common shares over the exercise price over a period of time, each as specified in the applicable award agreement. The exercise price of any SAR granted may not be less than the fair market value of our common shares on the date of grant. The compensation expense for the SARs is measured based on the fair value of the SARs at the date of grant and is recognized over the requisite service period. The SARs vest over a maximum of three years, have a life of ten years and settle in common shares. It is assumed that all time-based SARs will vest. We recognize forfeitures of SARs in the period in which they occur.

The total fair value of SARs vested was $0.7 million during the three months ended April 2, 2023.

Three Months Ended April 2, 2023	Stock Appreciation Rights	Aggregate Intrinsic Value (in thousands)		Weighted Average Exercise Price		Average Remaining Contractual Life (Years)
Outstanding, beginning of period	184,205	$	2,153	$	74.75	7.0
Granted	30,946			88.99
Exercised	—	—		—
Cancelled and forfeited	—			—
Outstanding, end of period	215,151	$	3,420	$	76.79	7.2
Exercisable, end of period	152,717	$	3,309	$	70.89	6.4

The value of SARs granted is determined using the Black-Scholes-Merton valuation model, and the corresponding expense is expected to be recognized over the average requisite service period of 2.0 years. Expected volatility is based upon the historical volatility of our common shares amongst other considerations. The expected term is calculated based upon historical employee exercise behavior and the contractual term of the SAR amongst other considerations. The weighted average grant date assumptions used for the SARs granted were as follows for the periods indicated:

	2023 Grants
SAR value (model conclusion)	$	32.63
Risk-free rate	4.1		%
Expected dividend yield	0.0		%
Expected volatility	28.4		%
Expected term (years)	6.0

Restricted Stock Units

We have granted Restricted Stock Units ("RSUs") to directors and certain employees under the 2021 Equity Plan and the 2012 Plan. The RSUs confer the right to receive shares of our common stock at a specified future date or when certain conditions are met. The compensation expense for the RSUs granted is based on the fair value of the RSUs at the date of grant, which is equal to the stock price on the date of grant, and is recognized over the requisite service period. The RSUs vest over a maximum of three years and call for the underlying shares to be delivered no later than 30 days following the vesting date unless the participant is subject to a blackout period. In such case, the shares are to be

delivered once the blackout restriction has been lifted. It is assumed that all time-based RSUs will vest. We recognize forfeitures of RSUs in the period in which they occur.

Three Months Ended April 2, 2023	Total Restricted Stock Units Outstanding	Weighted Average Grant Date Fair Value
Outstanding, beginning of period	313,753	$	92.85
Granted	192,847	89.15
Delivered	(79,511)	92.31
Withheld to cover (1)	(17,434)
Forfeited	(17,131)	90.13
Outstanding, end of period	392,524	$	91.28

___________

(1) A portion of the vested RSUs delivered were net shares settled to cover statutory requirements for income and other employment taxes. We remit the equivalent cash to the appropriate taxing authorities. These net share settlements had the effect of share repurchases by us as we reduced and retired the number of shares that would have otherwise been issued as a result of the vesting.

RSUs granted during the three months ended April 2, 2023, vest at specified future dates with only service requirements. The value of RSUs granted in the three months ended April 2, 2023, was $17.2 million and is being recognized over the weighted average requisite service period of 2.0 years. During the three months ended April 2, 2023, 96,945 RSUs vested at a fair value of $8.9 million.

Performance-based Restricted Stock Units

We have granted certain Performance-based Restricted Stock Units ("PRSUs") under the 2021 Equity Plan and the 2012 Plan. These PRSUs are settled with payouts ranging from zero to 200% of the target award value depending on performance goal achievement. The compensation expense for the PRSUs awarded is based on the fair value of the PRSUs at the date of grant, which is equal to the stock price on the date of grant, and is recognized over the requisite service period. The compensation expense for certain PRSUs is determined using the Monte Carlo simulation method. The PRSUs vest over a maximum of three years and call for the underlying shares to be delivered no later than 30 days following the vesting date unless the participant is subject to a blackout period. In such case, the shares are to be delivered once the blackout restriction has been lifted.

Three Months Ended April 2, 2023	Total Performance Restricted Stock Units Outstanding	Weighted Average Grant Date Fair Value
Outstanding, beginning of period	310,678	$	90.15
Granted	91,631	104.24
Performance adjustment (1)	17,139	79.25
Delivered	(63,432)	79.25
Withheld to cover (2)	(5,224)
Forfeited	(3,782)	94.72
Outstanding, end of period	347,010	$	95.44

___________

(1) PRSUs are presented as outstanding, granted and forfeited in the table above assuming targets are met and the awards pay out at 100%. Certain awards are settled with payouts ranging from zero to 200% of the target award value depending on achievement. The performance adjustment represents the difference in shares ultimately awarded due to performance attainment above or below target.

(2) A portion of the vested PRSUs delivered were net shares settled to cover statutory requirements for income and other employment taxes. We remit the equivalent cash to the appropriate taxing authorities. These net share settlements had the effect of share repurchases by us as we reduced and retired the number of shares that would have otherwise been issued as a result of the vesting.

PRSUs granted during the three months ended April 2, 2023, vest at specified future dates based on both performance and service requirements. The value of PRSUs granted in the three months ended April 2, 2023, was $9.6 million and is being recognized over the weighted average requisite service period of 3.0 years. During the three months ended April 2, 2023, 68,656 PRSUs vested at a fair value of $5.4 million.

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Restructuring Costs

3 Months Ended

Apr. 02, 2023

Restructuring and Related Activities [Abstract]

Restructuring Costs

Restructuring Costs

In December 2022, we began implementing a plan intended to improve overall business performance that includes the optimization of our manufacturing capacity and reduction of our overhead and selling, general and administration workforce primarily in our North American Residential reportable segment as well as actions in the Architectural reportable segment and in our head offices (collectively, the "2022 Plan"). The optimization of our manufacturing capacity involves specific plants in the North American Residential segment and costs associated with the closure of these plants and related headcount reductions. Costs associated with the 2022 Plan include severance and closure charges which continue throughout 2023. As of April 2, 2023, we expect to incur approximately $9 million to $14 million of additional charges related to the 2022 Plan.

The following tables summarize the restructuring (benefit) costs recorded for the periods indicated:

	Three Months Ended April 2, 2023
(In thousands)	North American Residential		Architectural		Corporate & Other		Total
2022 Plan	$	2,380	$	684	$	614	$	3,678
Total Restructuring Costs	$	2,380	$	684	$	614	$	3,678

	Three Months Ended April 3, 2022
(In thousands)	North American Residential		Architectural		Corporate & Other		Total
Other	$	(91)	$	47	$	25	$	(19)
Total Restructuring (Benefit) Costs	$	(91)	$	47	$	25	$	(19)

	Cumulative Amount Incurred Through April 2, 2023
(In thousands)	North American Residential		Europe		Architectural		Corporate & Other		Total
2022 Plan	$	4,511	$	—	$	684	$	614	$	5,809
Total Restructuring Costs	$	4,511	$	—	$	684	$	614	$	5,809

The changes in the accrual for restructuring by activity were as follows for the periods indicated:

(In thousands)	January 1, 2023		Severance		Closure Costs		Cash Payments		April 2, 2023
2022 Plan	$	—	$	3,583	$	95	$	(2,897)	$	781
Total	$	—	$	3,583	$	95	$	(2,897)	$	781

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Income Taxes	3 Months Ended
	Apr. 02, 2023
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes The effective tax rate differs from the Canadian statutory rate of 26.13% primarily due to mix of earnings in foreign jurisdictions that are subject to tax rates which differ from the Canadian statutory rate. In addition, we recognized zero income tax benefit due to the exercise and delivery of share based awards during the three months ended April 2, 2023, compared to $1.1 million of income tax benefit during the three months ended April 3, 2022.On August 16, 2022, President Biden signed the Inflation Reduction Act of 2022 ("IRA") into law. The IRA includes several changes to existing tax law, including a minimum tax on adjusted financial statement income of applicable corporations and an excise tax on certain corporate stock buybacks. The tax provisions included in the IRA were generally effective beginning January 1, 2023, and no significant impact to the consolidated financial statements resulted from their adoption as of April 2, 2023.

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Earnings Per Share

3 Months Ended

Apr. 02, 2023

Earnings Per Share [Abstract]

Earnings Per Share

Earnings Per Share

Basic earnings per share ("EPS") is calculated by dividing earnings attributable to Masonite by the weighted average number of our common shares outstanding during the period. Diluted EPS is calculated by dividing earnings attributable to Masonite by the weighted average number of common shares plus the incremental number of shares issuable from non-vested and vested RSUs and SARs outstanding during the period.

(In thousands, except share and per share information)	Three Months Ended
	April 2, 2023		April 3, 2022
Net income attributable to Masonite	$	38,491	$	67,582
Shares used in computing basic earnings per share	22,183,068		23,081,474
Effect of dilutive securities:
Incremental shares issuable under share compensation plans	297,165		296,880
Shares used in computing diluted earnings per share	22,480,233		23,378,354
Basic earnings per common share attributable to Masonite	$	1.74	$	2.93
Diluted earnings per common share attributable to Masonite	$	1.71	$	2.89
Anti-dilutive instruments excluded from diluted earnings per common share	191,385		72,954

The weighted average number of shares outstanding utilized for the diluted EPS calculation contemplates the exercise of all currently outstanding SARs and the conversion of all RSUs. The dilutive effect of such equity awards is calculated based on the weighted average share price for each fiscal period using the treasury stock method.

The Company's Board of Directors has approved five share repurchase authorizations, the most recent being an incremental $200.0 million share repurchase program approved on February 21, 2022. Under this program, the Company may repurchase shares from time to time, depending on market conditions and alternate uses of capital. The timing and actual number of shares repurchased will depend on a variety of factors, including price, general business and market conditions and alternate uses of capital. The share repurchase program may be effected through Rule 10b5-1 plans, open market purchases, each in compliance with Rule 10b-18 under the Exchange Act, or privately negotiated transactions. The program may be suspended or discontinued at any time and does not have an expiration date. In addition, the Company announced that its Board of Directors authorized it to enter into an accelerated share repurchase ("ASR") transaction as part of the new share repurchase program. The Company entered into an ASR transaction during the first quarter of 2022 with a third-party financial institution for the repurchase of $100.0 million of its outstanding common shares. At inception, pursuant to the agreement, the Company paid $100.0 million to the financial institution using cash on hand and received an initial delivery of 848,087 common shares on the same day. The final delivery of 319,678 common shares occurred in the second quarter. The $100.0 million ASR transaction was therefore completed in the second quarter of 2022 with a total delivery of 1,167,765 common shares at a volume-weighted average price ("VWAP") per share minus an agreed upon discount totaling $85.63 per share. The cash paid was reflected as a reduction of equity at the initial delivery of shares and the number of common shares outstanding were reduced at the dates of physical delivery.

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Segment Information

3 Months Ended

Apr. 02, 2023

Segment Reporting [Abstract]

Segment Information

Segment Information

Our reportable segments are organized and managed principally by end market: North American Residential, Europe and Architectural. The Corporate & Other category includes unallocated corporate costs and the results of immaterial operating segments which were not aggregated into any reportable segment. In addition to similar economic characteristics, we also consider the following factors in determining the reportable segments: the nature of business activities, the management structure directly accountable to our chief operating decision maker for operating and administrative activities, availability of discrete financial information and information presented to the Board of Directors and investors.

Our management reviews net sales and Adjusted EBITDA (as defined below) to evaluate segment performance and allocate resources. Net assets are not allocated to the reportable segments. Adjusted EBITDA is a non-GAAP financial measure which does not have a standardized meaning under GAAP and is unlikely to be comparable to similar measures used by other companies. Adjusted EBITDA should not be considered as an alternative to either net income or operating cash flows determined in accordance with GAAP. Adjusted EBITDA is defined as net income (loss) attributable to Masonite adjusted to exclude the following items:

•    depreciation;

•    amortization;

•    share based compensation expense;

•    loss (gain) on disposal of property, plant and equipment;

•    registration and listing fees;

•    restructuring costs (benefit);

•    asset impairment;

•    loss (gain) on disposal of subsidiaries;

•    interest expense (income), net;

•    loss on extinguishment of debt;

•    other expense (income), net;

•    income tax expense (benefit);

•    other items;

•    loss (income) from discontinued operations, net of tax; and

•    net income (loss) attributable to non-controlling interest.

This definition of Adjusted EBITDA differs from the definitions of EBITDA contained in the indentures governing the 2030 Notes and the 2028 Notes and the credit agreements governing the Term Loan Facility and the ABL Facility. Although Adjusted EBITDA is not a measure of financial condition or performance determined in accordance with GAAP, it is used to evaluate and compare the operating performance of our reportable segments and it is one of the primary measures used to determine employee incentive compensation. Intersegment sales are recorded using market prices.

Certain information with respect to reportable segments is as follows for the periods indicated:

	Three Months Ended April 2, 2023
(In thousands)	North American Residential		Europe		Architectural		Corporate & Other		Total
Net sales	$	569,429	$	63,716	$	92,861	$	5,349	$	731,355
Intersegment sales	(390)		(22)		(4,959)		—		(5,371)
Net sales to external customers	$	569,039	$	63,694	$	87,902	$	5,349	$	725,984
Adjusted EBITDA	$	107,881	$	5,151	$	5,350	$	(12,217)	$	106,165

	Three Months Ended April 3, 2022
(In thousands)	North American Residential		Europe		Architectural		Corporate & Other		Total
Net sales	$	569,429	$	81,839	$	74,659	$	6,196	$	732,123
Intersegment sales	(865)		(1,371)		(3,670)		—		(5,906)
Net sales to external customers	$	568,564	$	80,468	$	70,989	$	6,196	$	726,217
Adjusted EBITDA	$	127,667	$	11,843	$	(2,898)	$	(11,860)	$	124,752

A reconciliation of our net income attributable to Masonite to consolidated Adjusted EBITDA is set forth as follows for the periods indicated:

	Three Months Ended
(In thousands)	April 2, 2023		April 3, 2022
Net income attributable to Masonite	$	38,491	$	67,582
Plus:
Depreciation	21,485		17,272
Amortization	7,421		4,612
Share based compensation expense	6,054		4,719
Loss (gain) on disposal of property, plant and equipment	1,038		(2,854)
Restructuring costs (benefit)	3,678		(19)
Interest expense, net	14,252		10,239
Other (income) expense, net	52		(1,415)
Income tax expense	11,360		23,477
Other items (1)	1,381		—
Net income attributable to non-controlling interest	953		1,139
Adjusted EBITDA	$	106,165	$	124,752

(1) Other items include $1,381 in acquisition and due diligence related costs in the three months ended April 2, 2023, and were recorded in selling, general and administration expenses within the condensed consolidated statements of comprehensive income.

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Accumulated Other Comprehensive Loss and Other Comprehensive (Loss) Income

3 Months Ended

Apr. 02, 2023

Equity [Abstract]

Accumulated Other Comprehensive Loss and Other Comprehensive (Loss) Income

Accumulated Other Comprehensive Loss and Other Comprehensive Income (Loss)

A rollforward of the components of accumulated other comprehensive loss is as follows for the periods indicated:

	Three Months Ended
(In thousands)	April 2, 2023		April 3, 2022
Accumulated foreign currency translation losses, beginning of period	$	(132,001)	$	(96,919)
Foreign currency translation gain (loss)	8,949		(2,105)
Income tax expense (benefit) on foreign currency translation loss	—		11
Less: foreign currency translation (loss) gain attributable to non-controlling interest	(8)		1,139
Accumulated foreign currency translation losses, end of period	(123,044)		(100,152)
Accumulated pension and other post-retirement adjustments, beginning of period	(10,223)		(4,663)
Amortization of actuarial net losses	191		6
Income tax expense on amortization of actuarial net losses	(45)		(1)
Accumulated pension and other post-retirement adjustments	(10,077)		(4,658)
Accumulated other comprehensive loss	$	(133,121)	$	(104,810)
Other comprehensive gain (loss), net of tax	$	9,095	$	(2,089)
Less: other comprehensive (loss) income attributable to non-controlling interest	(8)		1,139
Other comprehensive income (loss) attributable to Masonite	$	9,103	$	(3,228)

Cumulative translation adjustments are reclassified out of accumulated other comprehensive loss into loss on disposal of subsidiaries in the condensed consolidated statements of income and comprehensive income. Actuarial net losses are reclassified out of accumulated other comprehensive loss into cost of goods sold in the condensed consolidated statements of income and comprehensive income.

Foreign currency translation gains as a result of translating our foreign assets and liabilities into U.S. dollars during the three months ended April 2, 2023, were $8.9 million. These foreign currency translation gains were primarily driven by strengthening of the Pound Sterling, the Mexican Peso and the Euro in comparison to the U.S. dollar during the period.

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Supplemental Cash Flow Information

3 Months Ended

Apr. 02, 2023

Supplemental Cash Flow Elements [Abstract]

Supplemental Cash Flow Information

Supplemental Cash Flow Information

Certain cash and non-cash transactions were as follows for the periods indicated:

	Three Months Ended
(In thousands)	April 2, 2023		April 3, 2022
Transactions involving cash:
Interest paid	$	23,872	$	20,341
Interest received	2,210		166
Income taxes paid	16,267		16,735
Income tax refunds	41		8
Cash paid for operating lease liabilities	9,095		8,372
Cash paid for finance lease liabilities	358		366
Non-cash transactions:
Right-of-use assets acquired under operating leases	11,374		1,434
Holdback of portion of Endura purchase payable	18,000		—

The following reconciles total cash, cash equivalents and restricted cash as of the dates indicated:

	April 2, 2023		January 1, 2023
Cash and cash equivalents	$	210,725	$	296,922
Restricted cash	11,587		11,999
Total cash, cash equivalents and restricted cash	$	222,312	$	308,921

Property, plant and equipment additions in accounts payable were $9.9 million and $10.4 million as of April 2, 2023, and January 1, 2023, respectively.

During the fourth quarter of 2018, we provided debt financing to a distribution company via an interest-bearing note that was scheduled to mature in 2028. The interest-bearing note receivable was carried at amortized cost, with the interest payable in kind at the election of the borrower. The note receivable balance was $12.6 million as of January 1, 2023, and was recorded in the consolidated balance sheets as a component of prepaid expenses and other assets. On January 26, 2023, the note receivable was redeemed and fully repaid.

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Fair Value of Financial Instruments

3 Months Ended

Apr. 02, 2023

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

Fair Value of Financial Instruments

The carrying amounts of our cash and cash equivalents, restricted cash, accounts receivable, income taxes receivable, accounts payable, accrued expenses and income taxes payable approximate fair value because of the short-term maturity of those instruments. The carrying amount of our Term Loan Facility approximates fair value as the interest rates are variable and reflective of market rates. The estimated fair values and carrying values of our long-term senior note debt instruments were as follows for the periods indicated:

	April 2, 2023				January 1, 2023
(In thousands)	Fair Value		Carrying Value		Fair Value		Carrying Value
3.50% senior unsecured notes due 2030	$	313,781	$	371,271	$	303,870	$	371,136
5.375% senior unsecured notes due 2028	$	478,530	$	496,053	$	462,495	$	495,868

These estimates are based on market quotes and calculations based on current market rates available to us and are categorized as having Level 2 valuation inputs as established by the FASB's Fair Value Framework. Market quotes used in these calculations are based on bid prices for our debt instruments and are obtained from and corroborated with multiple independent sources. The market quotes obtained from independent sources are within the range of management's expectations.

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Business Overview and Significant Accounting Policies (Policies)

3 Months Ended

Apr. 02, 2023

Accounting Policies [Abstract]

Adoption of Recent Accounting Pronouncements

Adoption of Recent Accounting Pronouncements

In December 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2021-10, "Government Assistance," which requires annual disclosures that increase the transparency of transactions involving government grants, including (1) the types of transactions, (2) the accounting for those transactions and (3) the effect of those transactions on an entity's financial statements. The guidance is effective for annual periods beginning after December 15, 2021, with early adoption permitted. We adopted the new guidance as of January 3, 2022, the beginning of fiscal year 2022, and the adoption did not have a material impact on our financial statements.

In October 2021, the FASB issued ASU 2021-08, "Accounting for Contract Assets and Contract Liabilities from Contracts with Customers," which clarifies that an acquirer of a business should recognize and measure contract assets and contract liabilities in a business combination in accordance with ASU 2014-09, "Revenue from Contracts with Customers" as if the entity had originated the contracts. We adopted the new guidance as of January 1, 2023, the beginning of fiscal year 2023, and the adoption did not have a material impact on our financial statements.

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Acquisitions and Divestitures (Tables)

3 Months Ended

Apr. 02, 2023

Business Combination and Asset Acquisition [Abstract]

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The allocation of the purchase price to assets acquired and liabilities assumed is as follows:

(In thousands)	Endura
Cash acquired	$	32,501
Accounts receivable, net	7,871
Inventories, net	44,183
Property, plant and equipment, net	54,373
Goodwill	189,938
Intangible assets	135,800
Accounts payable and accrued expenses	(15,088)
Deferred income taxes	(44,345)
Other assets and liabilities, net	2,868
Total purchase price	$	408,101

Schedule of Finite-Lived Intangible Assets

Intangible assets acquired from the Endura acquisition consist of the following:

	Fair Value  (in thousands)		Expected Useful Life (Years)
Customer relationships	$	116,000	10
Trademarks and trade names	6,600		10
Patents	13,200		12
Total intangible assets acquired	$	135,800

Schedule of Pro Forma Information

The following unaudited pro forma financial information represents the consolidated financial information as if the Endura acquisition had been included in our consolidated results beginning on January 2, 2022, the first day of the fiscal year prior to the respective acquisition date. The pro forma results have been calculated after adjusting the results of the acquired entities to remove intercompany transactions and to reflect the additional depreciation, amortization and interest expense that would have been charged assuming the fair value adjustments to property, plant and equipment and intangible assets and the additional debt incurred to fund the acquisition had been applied on the first day of the fiscal year prior to the respective acquisition, together with the consequential tax effects. The pro forma results do not reflect any cost savings, operating synergies or revenue enhancements that the combined company may achieve as a result of the acquisitions; the costs to combine the companies' operations; or the costs necessary to achieve these costs savings, operating synergies and revenue enhancements. As a result, the pro forma information below does not purport to present what actual results would have been had the acquisition been consummated on the date indicated and it is not necessarily indicative of future results of operations.

	Three Months Ended April 3, 2022
(In thousands)	Masonite		Endura		Pro Forma Adjustments		Pro Forma
Net sales	$	726,217	$	72,716	$	(2,604)	$	796,329
Net income attributable to Masonite	67,582		3,353		(5,881)		65,054
Basic earnings per common share	$	2.93					$	2.82
Diluted earnings per common share	$	2.89					$	2.78

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Inventories (Tables)

3 Months Ended

Apr. 02, 2023

Inventory Disclosure [Abstract]

Inventories

The amounts of inventory on hand were as follows as of the dates indicated:

(In thousands)	April 2, 2023		January 1, 2023
Raw materials	$	288,385	$	320,553
Finished goods	143,322		95,005
Provision for obsolete or aged inventory	(13,126)		(8,730)
Inventories, net	$	418,581	$	406,828

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Accrued Expenses (Tables)

3 Months Ended

Apr. 02, 2023

Accrued Expenses [Abstract]

Schedule of Accrued Expenses

The details of our accrued expenses were as follows as of the dates indicated:

(In thousands)	April 2, 2023		January 1, 2023
Accrued payroll	$	57,084	$	69,224
Accrued rebates	49,410		50,200
Current portion of operating lease liabilities	24,492		24,372
Accrued interest	8,142		16,480
Other accruals	54,514		62,770
Total accrued expenses	$	193,642	$	223,046

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Long-Term Debt (Tables)

3 Months Ended

Apr. 02, 2023

Debt Disclosure [Abstract]

Schedule of Long-Term Debt

(In thousands)	April 2, 2023		January 1, 2023
Senior unsecured notes, interest rate of 3.50%, due 2030	$	375,000	$	375,000
Senior unsecured notes, interest rate of 5.375%, due 2028	500,000		500,000
Term Loan Facility, interest rate of SOFR plus 2.25%, due 2027	250,000		—
Debt issuance costs	(11,120)		(8,884)
Total long-term debt	$	1,113,880	$	866,116

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Share Based Compensation Plans (Tables)

3 Months Ended

Apr. 02, 2023

Share-Based Payment Arrangement [Abstract]

Stock Appreciation Rights Award Activity

Three Months Ended April 2, 2023	Stock Appreciation Rights	Aggregate Intrinsic Value (in thousands)		Weighted Average Exercise Price		Average Remaining Contractual Life (Years)
Outstanding, beginning of period	184,205	$	2,153	$	74.75	7.0
Granted	30,946			88.99
Exercised	—	—		—
Cancelled and forfeited	—			—
Outstanding, end of period	215,151	$	3,420	$	76.79	7.2
Exercisable, end of period	152,717	$	3,309	$	70.89	6.4

Schedule of Share-Based Compensation, Stock Appreciation Rights, Valuation Assumptions

The weighted average grant date assumptions used for the SARs granted were as follows for the periods indicated:

	2023 Grants
SAR value (model conclusion)	$	32.63
Risk-free rate	4.1		%
Expected dividend yield	0.0		%
Expected volatility	28.4		%
Expected term (years)	6.0

Restricted Stock Units Award Activity

Three Months Ended April 2, 2023	Total Restricted Stock Units Outstanding	Weighted Average Grant Date Fair Value
Outstanding, beginning of period	313,753	$	92.85
Granted	192,847	89.15
Delivered	(79,511)	92.31
Withheld to cover (1)	(17,434)
Forfeited	(17,131)	90.13
Outstanding, end of period	392,524	$	91.28

___________(1) A portion of the vested RSUs delivered were net shares settled to cover statutory requirements for income and other employment taxes. We remit the equivalent cash to the appropriate taxing authorities. These net share settlements had the effect of share repurchases by us as we reduced and retired the number of shares that would have otherwise been issued as a result of the vesting.

Share-Based Payment Arrangement, Performance Shares, Activity

Three Months Ended April 2, 2023	Total Performance Restricted Stock Units Outstanding	Weighted Average Grant Date Fair Value
Outstanding, beginning of period	310,678	$	90.15
Granted	91,631	104.24
Performance adjustment (1)	17,139	79.25
Delivered	(63,432)	79.25
Withheld to cover (2)	(5,224)
Forfeited	(3,782)	94.72
Outstanding, end of period	347,010	$	95.44

___________

(1) PRSUs are presented as outstanding, granted and forfeited in the table above assuming targets are met and the awards pay out at 100%. Certain awards are settled with payouts ranging from zero to 200% of the target award value depending on achievement. The performance adjustment represents the difference in shares ultimately awarded due to performance attainment above or below target.

(2) A portion of the vested PRSUs delivered were net shares settled to cover statutory requirements for income and other employment taxes. We remit the equivalent cash to the appropriate taxing authorities. These net share settlements had the effect of share repurchases by us as we reduced and retired the number of shares that would have otherwise been issued as a result of the vesting.

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Restructuring Costs (Tables)

3 Months Ended

Apr. 02, 2023

Restructuring and Related Activities [Abstract]

Summary of Restructuring (Benefit) Costs by Plan

The following tables summarize the restructuring (benefit) costs recorded for the periods indicated:

	Three Months Ended April 2, 2023
(In thousands)	North American Residential		Architectural		Corporate & Other		Total
2022 Plan	$	2,380	$	684	$	614	$	3,678
Total Restructuring Costs	$	2,380	$	684	$	614	$	3,678

	Three Months Ended April 3, 2022
(In thousands)	North American Residential		Architectural		Corporate & Other		Total
Other	$	(91)	$	47	$	25	$	(19)
Total Restructuring (Benefit) Costs	$	(91)	$	47	$	25	$	(19)

	Cumulative Amount Incurred Through April 2, 2023
(In thousands)	North American Residential		Europe		Architectural		Corporate & Other		Total
2022 Plan	$	4,511	$	—	$	684	$	614	$	5,809
Total Restructuring Costs	$	4,511	$	—	$	684	$	614	$	5,809

Schedule of Restructuring Reserve by Type of Cost

The changes in the accrual for restructuring by activity were as follows for the periods indicated:

(In thousands)	January 1, 2023		Severance		Closure Costs		Cash Payments		April 2, 2023
2022 Plan	$	—	$	3,583	$	95	$	(2,897)	$	781
Total	$	—	$	3,583	$	95	$	(2,897)	$	781

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Earnings Per Share (Tables)

3 Months Ended

Apr. 02, 2023

Earnings Per Share [Abstract]

Schedule of Earnings Per Share

(In thousands, except share and per share information)	Three Months Ended
	April 2, 2023		April 3, 2022
Net income attributable to Masonite	$	38,491	$	67,582
Shares used in computing basic earnings per share	22,183,068		23,081,474
Effect of dilutive securities:
Incremental shares issuable under share compensation plans	297,165		296,880
Shares used in computing diluted earnings per share	22,480,233		23,378,354
Basic earnings per common share attributable to Masonite	$	1.74	$	2.93
Diluted earnings per common share attributable to Masonite	$	1.71	$	2.89
Anti-dilutive instruments excluded from diluted earnings per common share	191,385		72,954

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Segment Information (Tables)

3 Months Ended

Apr. 02, 2023

Segment Reporting [Abstract]

Schedule of Segment Reporting Information, by Segment

Certain information with respect to reportable segments is as follows for the periods indicated:

	Three Months Ended April 2, 2023
(In thousands)	North American Residential		Europe		Architectural		Corporate & Other		Total
Net sales	$	569,429	$	63,716	$	92,861	$	5,349	$	731,355
Intersegment sales	(390)		(22)		(4,959)		—		(5,371)
Net sales to external customers	$	569,039	$	63,694	$	87,902	$	5,349	$	725,984
Adjusted EBITDA	$	107,881	$	5,151	$	5,350	$	(12,217)	$	106,165

	Three Months Ended April 3, 2022
(In thousands)	North American Residential		Europe		Architectural		Corporate & Other		Total
Net sales	$	569,429	$	81,839	$	74,659	$	6,196	$	732,123
Intersegment sales	(865)		(1,371)		(3,670)		—		(5,906)
Net sales to external customers	$	568,564	$	80,468	$	70,989	$	6,196	$	726,217
Adjusted EBITDA	$	127,667	$	11,843	$	(2,898)	$	(11,860)	$	124,752

Reconciliation of Consolidated Adjusted EBITDA to Net Income (Loss) Attributable to Masonite

A reconciliation of our net income attributable to Masonite to consolidated Adjusted EBITDA is set forth as follows for the periods indicated:

	Three Months Ended
(In thousands)	April 2, 2023		April 3, 2022
Net income attributable to Masonite	$	38,491	$	67,582
Plus:
Depreciation	21,485		17,272
Amortization	7,421		4,612
Share based compensation expense	6,054		4,719
Loss (gain) on disposal of property, plant and equipment	1,038		(2,854)
Restructuring costs (benefit)	3,678		(19)
Interest expense, net	14,252		10,239
Other (income) expense, net	52		(1,415)
Income tax expense	11,360		23,477
Other items (1)	1,381		—
Net income attributable to non-controlling interest	953		1,139
Adjusted EBITDA	$	106,165	$	124,752

(1) Other items include $1,381 in acquisition and due diligence related costs in the three months ended April 2, 2023, and were recorded in selling, general and administration expenses within the condensed consolidated statements of comprehensive income.

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Accumulated Other Comprehensive Loss and Other Comprehensive (Loss) Income (Tables)

3 Months Ended

Apr. 02, 2023

Equity [Abstract]

Schedule of Components of Accumulated Other Comprehensive (Loss) Income

A rollforward of the components of accumulated other comprehensive loss is as follows for the periods indicated:

	Three Months Ended
(In thousands)	April 2, 2023		April 3, 2022
Accumulated foreign currency translation losses, beginning of period	$	(132,001)	$	(96,919)
Foreign currency translation gain (loss)	8,949		(2,105)
Income tax expense (benefit) on foreign currency translation loss	—		11
Less: foreign currency translation (loss) gain attributable to non-controlling interest	(8)		1,139
Accumulated foreign currency translation losses, end of period	(123,044)		(100,152)
Accumulated pension and other post-retirement adjustments, beginning of period	(10,223)		(4,663)
Amortization of actuarial net losses	191		6
Income tax expense on amortization of actuarial net losses	(45)		(1)
Accumulated pension and other post-retirement adjustments	(10,077)		(4,658)
Accumulated other comprehensive loss	$	(133,121)	$	(104,810)
Other comprehensive gain (loss), net of tax	$	9,095	$	(2,089)
Less: other comprehensive (loss) income attributable to non-controlling interest	(8)		1,139
Other comprehensive income (loss) attributable to Masonite	$	9,103	$	(3,228)

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Supplemental Cash Flow Information (Tables)

3 Months Ended

Apr. 02, 2023

Supplemental Cash Flow Elements [Abstract]

Cash and Non-Cash Transactions

Certain cash and non-cash transactions were as follows for the periods indicated:

	Three Months Ended
(In thousands)	April 2, 2023		April 3, 2022
Transactions involving cash:
Interest paid	$	23,872	$	20,341
Interest received	2,210		166
Income taxes paid	16,267		16,735
Income tax refunds	41		8
Cash paid for operating lease liabilities	9,095		8,372
Cash paid for finance lease liabilities	358		366
Non-cash transactions:
Right-of-use assets acquired under operating leases	11,374		1,434
Holdback of portion of Endura purchase payable	18,000		—

Schedule of Cash, Cash Equivalents and Restricted Cash

The following reconciles total cash, cash equivalents and restricted cash as of the dates indicated:

	April 2, 2023		January 1, 2023
Cash and cash equivalents	$	210,725	$	296,922
Restricted cash	11,587		11,999
Total cash, cash equivalents and restricted cash	$	222,312	$	308,921

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Fair Value of Financial Instruments (Tables)

3 Months Ended

Apr. 02, 2023

Fair Value Disclosures [Abstract]

Schedule of Carrying Values and Estimated Fair Values of Debt Instruments

The estimated fair values and carrying values of our long-term senior note debt instruments were as follows for the periods indicated:

	April 2, 2023				January 1, 2023
(In thousands)	Fair Value		Carrying Value		Fair Value		Carrying Value
3.50% senior unsecured notes due 2030	$	313,781	$	371,271	$	303,870	$	371,136
5.375% senior unsecured notes due 2028	$	478,530	$	496,053	$	462,495	$	495,868

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Business Overview and Significant Accounting Policies (Details)	Apr. 02, 2023 Country facility
Accounting Policies [Abstract]
Number of manufacturing locations | facility	63
Number of countries | Country	7

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Acquisitions and Divestitures - Narrative (Details) - USD ($) $ in Thousands		3 Months Ended
	Jan. 03, 2023	Apr. 02, 2023	Jan. 01, 2023
Business Acquisition [Line Items]
Goodwill		$ 257,977	$ 69,868
Endura
Business Acquisition [Line Items]
Acquired equity interests, percent	100.00%
Business combination, consideration transferred	$ 408,100
Goodwill	189,938
Net sales		59,800
Net income (loss) attributable to Masonite		$ 4,500
Gross contractual value of acquired trade receivables	$ 8,300

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Acquisitions and Divestitures - Schedule of Recognized Identified Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands	Apr. 02, 2023	Jan. 03, 2023	Jan. 01, 2023
Business Acquisition [Line Items]
Goodwill	$ 257,977		$ 69,868
Endura
Business Acquisition [Line Items]
Cash acquired		$ 32,501
Accounts receivable, net		7,871
Inventories, net		44,183
Property, plant and equipment, net		54,373
Goodwill		189,938
Intangible assets		135,800
Accounts payable and accrued expenses		(15,088)
Deferred income taxes		(44,345)
Other assets and liabilities, net		2,868
Total purchase price		$ 408,101

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Acquisitions and Divestitures - Schedule of Finite-Lived Intangible Assets (Details) - Endura $ in Thousands	Jan. 03, 2023 USD ($)
Business Acquisition [Line Items]
Fair value	$ 135,800
Customer relationships
Business Acquisition [Line Items]
Fair value	$ 116,000
Expected useful life	10 years
Trademarks and trade names
Business Acquisition [Line Items]
Fair value	$ 6,600
Expected useful life	10 years
Patents
Business Acquisition [Line Items]
Fair value	$ 13,200
Expected useful life	12 years

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Acquisitions and Divestitures - Schedule of Pro Forma Information (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Apr. 02, 2023	Apr. 03, 2022
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Net sales	$ 725,984	$ 726,217
Net income attributable to Masonite	$ 38,491	$ 67,582
Basic earnings per common share attributable to Masonite (in dollars per share)	$ 1.74	$ 2.93
Diluted earnings per common share attributable to Masonite (in dollars per share)	$ 1.71	$ 2.89
Endura
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Net sales		$ 72,716
Net income attributable to Masonite		3,353
Pro forma revenue		796,329
Pro forma net income		$ 65,054
Pro forma earnings per share, basic (in dollars per share)		$ 2.82
Pro forma earnings per share, diluted (in dollars per share)		$ 2.78
Endura | Intercompany Eliminations
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Net sales		$ (2,604)
Net income attributable to Masonite		$ (5,881)

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Accounts Receivable (Details) $ in Thousands	3 Months Ended	12 Months Ended
	Apr. 02, 2023 USD ($) Customer	Jan. 01, 2023 USD ($)
Accounts, Notes, Loans and Financing Receivable [Line Items]
Allowance for doubtful accounts | $	$ 2,900	$ 2,500
Accounts Receivable | Customer Concentration Risk | Ten Largest Customers
Accounts, Notes, Loans and Financing Receivable [Line Items]
Concentration risk, customers | Customer	10
Concentration risk, percent	59.30%	62.30%
Accounts Receivable | Customer Concentration Risk | The Home Depot, Inc.
Accounts, Notes, Loans and Financing Receivable [Line Items]
Concentration risk, percent	10.00%	10.00%

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Inventories (Details) - USD ($) $ in Thousands	Apr. 02, 2023	Jan. 01, 2023
Inventory Disclosure [Abstract]
Raw materials	$ 288,385	$ 320,553
Finished goods	143,322	95,005
Provision for obsolete or aged inventory	(13,126)	(8,730)
Inventories, net	$ 418,581	$ 406,828

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Accrued Expenses (Details) - USD ($) $ in Thousands	Apr. 02, 2023	Jan. 01, 2023
Accrued Expenses [Abstract]
Accrued payroll	$ 57,084	$ 69,224
Accrued rebates	49,410	50,200
Current portion of operating lease liabilities	24,492	24,372
Accrued interest	8,142	16,480
Other accruals	54,514	62,770
Total accrued expenses	$ 193,642	$ 223,046

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Long-Term Debt (Schedule of Long-Term Debt) (Details) - USD ($) $ in Thousands	Apr. 02, 2023	Jan. 01, 2023	Jul. 26, 2021	Jul. 25, 2019
Debt Instrument [Line Items]
Total long-term debt	$ 1,113,880	$ 866,116
Senior Notes
Debt Instrument [Line Items]
Debt issuance costs	11,120	8,884
Senior Notes | Senior Notes 2030
Debt Instrument [Line Items]
Long-term debt	375,000	375,000
Interest rate stated percentage			3.50%
Senior Notes | Senior Notes Due 2028
Debt Instrument [Line Items]
Long-term debt	500,000	500,000
Interest rate stated percentage				5.375%
Line of Credit | Term Loan A | Secured Debt
Debt Instrument [Line Items]
Long-term debt	250,000	$ 0
Debt issuance costs	$ 3,600

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Long-Term Debt (Narrative) (Details) - USD ($)				3 Months Ended
	Jan. 03, 2023	Dec. 13, 2022	Oct. 28, 2022	Apr. 02, 2023	Apr. 03, 2022	Jul. 26, 2021	Jul. 25, 2019	Jan. 31, 2019
Debt Instrument [Line Items]
Proceeds from issuance of long-term debt				$ 250,000,000	$ 0
Revolving Credit Facility | ABL Facility 2024
Debt Instrument [Line Items]
Maximum borrowing capacity								$ 250,000,000
Line of credit facility, increase (decrease), net			$ 100,000,000
Revolving credit facility availability				313,400,000
Revolving Credit Facility | ABL Facility 2027
Debt Instrument [Line Items]
Maximum borrowing capacity			$ 350,000,000
Proceeds from borrowings on revolving credit facilities	$ 100,000,000
Senior Notes
Debt Instrument [Line Items]
Interest expense				$ 15,400,000	$ 10,300,000
Senior Notes | Senior Notes 2030
Debt Instrument [Line Items]
Interest rate stated percentage						3.50%
Aggregate principal						$ 375,000,000
Senior Notes | Senior Notes Due 2028
Debt Instrument [Line Items]
Interest rate stated percentage							5.375%
Aggregate principal							$ 500,000,000
Line of Credit | Secured Debt | Term Loan A
Debt Instrument [Line Items]
Aggregate principal		$ 250,000,000
Debt instrument, term		5 years
Maximum borrowing capacity		$ 250,000,000
Annual principal payment, percentage		15.00%
Unused borrowing capacity, fee, percentage		2500.00%
Proceeds from issuance of long-term debt		$ 246,400,000
Line of Credit | Secured Debt | Term Loan A | Adjusted Term Secured Overnight Financing Rate (SOFR)
Debt Instrument [Line Items]
Basis spread on variable rate		2.25%
Line of Credit | Secured Debt | Term Loan A | Adjusted Base Rate
Debt Instrument [Line Items]
Basis spread on variable rate		0.50%
Line of Credit | Secured Debt | Term Loan A | Premium Adjusted Term Secured Overnight Financing Rate (SOFR)
Debt Instrument [Line Items]
Basis spread on variable rate		1.00%
Line of Credit | Secured Debt | Term Loan A | Base Rate
Debt Instrument [Line Items]
Basis spread on variable rate		1.00%
Line of Credit | Secured Debt | Term Loan A | Applicable Margin
Debt Instrument [Line Items]
Basis spread on variable rate		1.25%

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Share Based Compensation Plans (Narrative) (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 02, 2023	Apr. 03, 2022	Mar. 10, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation	$ 6,054	$ 4,719
Share based compensation unrecognized	$ 47,000
Weighted average remaining requisite service period	2 years 1 month 6 days
Deferred compensation liability	$ 7,100
Deferred compensation asset	$ 7,000
2021 Plan | Common Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Equity awards not to exceed (in shares)			880,000
Common stock available for future issuance (in shares)	583,445
Stock Appreciation Rights (SARs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period	3 years
Plan term	10 years
Vested, fair value	$ 700
Average requisite service period	2 years
Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Average requisite service period	2 years
Units vested (in shares)	96,945
Fair value of shares vested	$ 8,900
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Fair Value	$ 17,200
Restricted Stock Units (RSUs) | Service Requirement
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage	65.00%
Restricted Stock Units (RSUs) | Service and Performance Requirements
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage	35.00%
Performance Shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period	3 years
Average requisite service period	3 years
Units vested (in shares)	68,656
Fair value of shares vested	$ 5,400
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Fair Value	$ 9,600

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Share Based Compensation Plans (SARs) (Details) - Stock Appreciation Rights (SARs) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended	12 Months Ended
	Apr. 02, 2023	Jan. 01, 2023
Stock Appreciation Rights
Outstanding, beginning of period (in shares)	184,205
Granted (in shares)	30,946
Exercised (in shares)	0
Forfeited (in shares)	0
Outstanding, end of period (in shares)	215,151	184,205
Exercisable, shares	152,717
Aggregate Intrinsic Value & Average Remaining Contractual Life
Outstanding, beginning of period, aggregate intrinsic value	$ 2,153
Exercised, aggregate intrinsic value	0
Outstanding, end period, aggregate intrinsic value	3,420	$ 2,153
Exercisable, aggregate intrinsic value	$ 3,309
Outstanding, beginning of period, weighted average remaining contractual term	7 years 2 months 12 days	7 years
Outstanding, end of period, weighted average remaining contractual term	7 years 2 months 12 days	7 years
Exercisable, weighted average remaining contractual term	6 years 4 months 24 days
Weighted Average Exercise Price
Outstanding, beginning of period (in dollars per share)	$ 74.75
Granted (in dollars per share)	88.99
Exercised (in dollars per share)	0
Forfeited (in dollars per share)	0
Outstanding, end of period (in dollars per share)	76.79	$ 74.75
Exercisable, end of period (in dollars per share)	$ 70.89

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Share Based Compensation Plans (Weighted Average Grant Date Assumptions) (Details) - Stock Appreciation Rights (SARs)	3 Months Ended
	Apr. 02, 2023 $ / shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
SAR value (model conclusion)	$ 32.63
Risk-free rate	4.10%
Expected dividend yield	0.00%
Expected volatility	28.40%
Expected term (years)	6 years

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Share Based Compensation Plans (RSUs) (Details)	3 Months Ended
	Apr. 02, 2023 $ / shares shares
Restricted Stock Units (RSUs)
Total Restricted Stock Units Outstanding
Outstanding, beginning of period (in shares)	313,753
Granted (in shares)	192,847
Delivered (in shares)	(79,511)
Withheld to cover (in shares)	(17,434)
Forfeited (in shares)	(17,131)
Outstanding, end of period (in shares)	392,524
Weighted Average Grant Date Fair Value
Outstanding, beginning of period (in dollars per share) | $ / shares	$ 92.85
Granted (in dollars per share) | $ / shares	89.15
Delivered (in dollars per share) | $ / shares	92.31
Forfeited (in dollars per share) | $ / shares	90.13
Outstanding, end of period (in dollars per share) | $ / shares	$ 91.28
Performance Shares
Total Restricted Stock Units Outstanding
Outstanding, beginning of period (in shares)	310,678
Granted (in shares)	91,631
Performance adjustment (in shares)	17,139
Delivered (in shares)	(63,432)
Withheld to cover (in shares)	(5,224)
Forfeited (in shares)	(3,782)
Outstanding, end of period (in shares)	347,010
Weighted Average Grant Date Fair Value
Outstanding, beginning of period (in dollars per share) | $ / shares	$ 90.15
Granted (in dollars per share) | $ / shares	104.24
Performance adjustment (in dollars per share) | $ / shares	79.25
Delivered (in dollars per share) | $ / shares	79.25
Forfeited (in dollars per share) | $ / shares	94.72
Outstanding, end of period (in dollars per share) | $ / shares	$ 95.44

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Restructuring Costs - Narrative (Details) $ in Millions	Apr. 02, 2023 USD ($)
Minimum
Restructuring Cost and Reserve [Line Items]
Expected restructuring cost remaining	$ 9
Maximum
Restructuring Cost and Reserve [Line Items]
Expected restructuring cost remaining	$ 14

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Restructuring Costs - Schedule of Restructuring Costs (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 02, 2023	Apr. 03, 2022	Jan. 01, 2023
Restructuring Cost and Reserve [Line Items]
Restructuring costs (benefit)	$ 3,678	$ (19)
Cumulative amount incurred to date	5,809
Restructuring reserve	(781)		$ 0
Cash payments	(2,897)
Severance
Restructuring Cost and Reserve [Line Items]
Restructuring costs (benefit)	3,583
Closure Costs
Restructuring Cost and Reserve [Line Items]
Restructuring costs (benefit)	95
North American Residential
Restructuring Cost and Reserve [Line Items]
Restructuring costs (benefit)	2,380
Cumulative amount incurred to date	4,511
Europe
Restructuring Cost and Reserve [Line Items]
Cumulative amount incurred to date	0
Architectural
Restructuring Cost and Reserve [Line Items]
Restructuring costs (benefit)	684
Cumulative amount incurred to date	684
Corporate & Other
Restructuring Cost and Reserve [Line Items]
Restructuring costs (benefit)	614
Cumulative amount incurred to date	614
Twenty Twenty Two Restructuring Plans
Restructuring Cost and Reserve [Line Items]
Restructuring costs (benefit)	3,678
Cumulative amount incurred to date	5,809
Restructuring reserve	(781)		$ 0
Cash payments	(2,897)
Twenty Twenty Two Restructuring Plans | Severance
Restructuring Cost and Reserve [Line Items]
Restructuring costs (benefit)	3,583
Twenty Twenty Two Restructuring Plans | Closure Costs
Restructuring Cost and Reserve [Line Items]
Restructuring costs (benefit)	95
Twenty Twenty Two Restructuring Plans | North American Residential
Restructuring Cost and Reserve [Line Items]
Restructuring costs (benefit)	2,380
Cumulative amount incurred to date	4,511
Twenty Twenty Two Restructuring Plans | Europe
Restructuring Cost and Reserve [Line Items]
Cumulative amount incurred to date	0
Twenty Twenty Two Restructuring Plans | Architectural
Restructuring Cost and Reserve [Line Items]
Restructuring costs (benefit)	684
Cumulative amount incurred to date	684
Twenty Twenty Two Restructuring Plans | Corporate & Other
Restructuring Cost and Reserve [Line Items]
Restructuring costs (benefit)	614
Cumulative amount incurred to date	$ 614
2018 - 2021 Restructuring Plans
Restructuring Cost and Reserve [Line Items]
Restructuring costs (benefit)		(19)
2018 - 2021 Restructuring Plans | North American Residential
Restructuring Cost and Reserve [Line Items]
Restructuring costs (benefit)		(91)
2018 - 2021 Restructuring Plans | Architectural
Restructuring Cost and Reserve [Line Items]
Restructuring costs (benefit)		47
2018 - 2021 Restructuring Plans | Corporate & Other
Restructuring Cost and Reserve [Line Items]
Restructuring costs (benefit)		$ 25

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Income Taxes (Details) - USD ($) $ in Millions	3 Months Ended
	Apr. 02, 2023	Apr. 03, 2022
Income Tax Disclosure [Abstract]
Canadian federal statutory rate	26.13%
Income tax benefit due to the exercise and delivery of share-based awards	$ 0.0	$ 1.1

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Earnings Per Share (Schedule of Earnings Per Share) (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Apr. 02, 2023	Apr. 03, 2022
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Net income attributable to Masonite	$ 38,491	$ 67,582
Shares used in computing basic earnings per share	22,183,068	23,081,474
Effect of dilutive securities:
Incremental shares issuable under share compensation plans	297,165	296,880
Shares used in computing diluted earnings per share	22,480,233	23,378,354
Basic earnings per common share attributable to Masonite (in dollars per share)	$ 1.74	$ 2.93
Diluted earnings per common share attributable to Masonite (in dollars per share)	$ 1.71	$ 2.89
Stock Appreciation Rights (SARs)
Effect of dilutive securities:
Anti-dilutive instruments excluded from diluted earnings per common share (in shares)	191,385	72,954

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Earnings Per Share (Narrative) (Details)	3 Months Ended		12 Months Ended
	Jul. 03, 2022 shares	Apr. 03, 2022 USD ($) shares	Jan. 01, 2023 authorization $ / shares shares	Feb. 21, 2022 shares
Equity, Class of Treasury Stock [Line Items]
Number of share repurchase authorizations | authorization			5
Number of shares authorized to be repurchased (in shares) | shares				200,000,000
Accelerated Share Repurchase
Equity, Class of Treasury Stock [Line Items]
Stock repurchase program, authorized amount | $		$ 100,000,000
Share repurchases, settlement (payment) | $		$ 100,000,000
Treasury stock, acquired (in shares) | shares	319,678	848,087	1,167,765
Treasury stock, acquired (in dollars per share) | $ / shares			$ 85.63

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Segment Information (Geographic Segments Information) (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 02, 2023	Apr. 03, 2022
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	$ 725,984	$ 726,217
Adjusted EBITDA	106,165	124,752
Operating Segments
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	731,355	732,123
Intersegment Eliminations
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	(5,371)	(5,906)
North American Residential
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	569,039	568,564
Adjusted EBITDA	107,881	127,667
North American Residential | Operating Segments
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	569,429	569,429
North American Residential | Intersegment Eliminations
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	(390)	(865)
Europe
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	63,694	80,468
Adjusted EBITDA	5,151	11,843
Europe | Operating Segments
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	63,716	81,839
Europe | Intersegment Eliminations
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	(22)	(1,371)
Architectural
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	87,902	70,989
Adjusted EBITDA	5,350	(2,898)
Architectural | Operating Segments
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	92,861	74,659
Architectural | Intersegment Eliminations
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	(4,959)	(3,670)
Corporate & Other
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	5,349	6,196
Adjusted EBITDA	(12,217)	(11,860)
Corporate & Other | Operating Segments
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	5,349	6,196
Corporate & Other | Intersegment Eliminations
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	$ 0	$ 0

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Segment Information (Reconciliation of Consolidated Adjusted EBITDA to Net Income (Loss)) (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 02, 2023	Apr. 03, 2022
Segment Reporting [Abstract]
Net income attributable to Masonite	$ 38,491	$ 67,582
Depreciation	21,485	17,272
Amortization	7,421	4,612
Share based compensation expense	6,054	4,719
Loss (gain) on disposal of property, plant and equipment	1,038	(2,854)
Restructuring costs (benefit)	3,678	(19)
Interest expense, net	14,252	10,239
Other (income) expense, net	52	(1,415)
Income tax expense	11,360	23,477
Other items	1,381	0
Net income attributable to non-controlling interest	953	1,139
Adjusted EBITDA	$ 106,165	$ 124,752

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Accumulated Other Comprehensive Loss and Other Comprehensive (Loss) Income (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 02, 2023	Apr. 03, 2022	Jan. 01, 2023
Accumulated Foreign Currency Translation Gains (Losses) [Roll Forward]
Accumulated foreign currency translation gains (losses), beginning of period	$ (132,001)	$ (96,919)
Foreign currency translation gain (loss)	8,949	(2,105)
Income tax benefit (expense) on foreign currency translation gain (loss)	0	11
Less: foreign currency translation gain (loss) attributable to non-controlling interest	(8)	1,139
Accumulated foreign currency translation gains (losses), end of period	(123,044)	(100,152)
Accumulated Amortization of Actuarial Net Losses [Roll Forward]
Accumulated pension and other post-retirement adjustments, beginning of period	(10,223)	(4,663)
Amortization of actuarial net losses	191	6
Income tax expense on amortization of actuarial net losses	45	1
Accumulated pension and other post-retirement adjustments	(10,077)	(4,658)
Accumulated other comprehensive loss	(133,121)	(104,810)	$ (142,224)
Other comprehensive gain (loss), net of tax	9,095	(2,089)
Less: other comprehensive (loss) income attributable to non-controlling interest	(8)	1,139
Other comprehensive income (loss) attributable to Masonite	$ 9,103	$ (3,228)

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Supplemental Cash Flow Information (Cash and Non-Cash Transactions) (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 02, 2023	Apr. 03, 2022
Transactions involving cash:
Interest paid	$ 23,872	$ 20,341
Interest received	2,210	166
Income taxes paid	16,267	16,735
Income tax refunds	41	8
Cash paid for operating lease liabilities	9,095	8,372
Cash paid for finance lease liabilities	358	366
Non-cash transactions:
Right-of-use assets acquired under operating leases	11,374	1,434
Holdback of portion of Endura purchase payable	$ 18,000	$ 0

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Supplemental Cash Flow Information (Cash, Cash Equivalents and Restricted Cash) (Details) - USD ($) $ in Thousands	Apr. 02, 2023	Jan. 01, 2023	Apr. 03, 2022	Jan. 02, 2022
Supplemental Cash Flow Elements [Abstract]
Cash and cash equivalents	$ 210,725	$ 296,922
Restricted cash	11,587	11,999
Total cash, cash equivalents and restricted cash	$ 222,312	$ 308,921	$ 194,624	$ 391,505

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Supplemental Cash Flow Information (Narrative) (Details) - USD ($) $ in Millions	3 Months Ended	12 Months Ended
	Apr. 02, 2023	Jan. 01, 2023
Cash and Cash Equivalents [Abstract]
Property, plant and equipment, additions	$ 9.9	$ 10.4
Financing Receivable, after Allowance for Credit Loss, Current		$ 12.6

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Fair Value of Financial Instruments (Details) - Senior Notes - USD ($) $ in Thousands	Apr. 02, 2023	Jan. 01, 2023	Jul. 26, 2021	Jul. 25, 2019
Senior Notes 2030
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Interest rate stated percentage			3.50%
Senior Notes 2030 | Fair Value | Fair Value, Inputs, Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Estimated fair value of senior notes	$ 313,781	$ 303,870
Senior Notes 2030 | Carrying Value | Fair Value, Inputs, Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Estimated fair value of senior notes	371,271	371,136
Senior Notes Due 2028
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Interest rate stated percentage				5.375%
Senior Notes Due 2028 | Fair Value | Fair Value, Inputs, Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Estimated fair value of senior notes	478,530	462,495
Senior Notes Due 2028 | Carrying Value | Fair Value, Inputs, Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Estimated fair value of senior notes	$ 496,053	$ 495,868