0001104659-21-076404 | 10-Q | XBRL Viewer

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Document and Entity Information - shares	3 Months Ended
Document and Entity Information - shares	Apr. 03, 2021	Jun. 01, 2021
Document and Entity Information [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Apr. 03, 2021
Entity Registrant Name	Latham Group, Inc.
Title of 12(b) Security	Class A common stock, par value $0.0001 per share
Trading Symbol	SWIM
Security Exchange Name	NASDAQ
Entity Current Reporting Status	No
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		120,409,271
Entity Central Index Key	0001833197
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q1
Amendment Flag	false

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Apr. 03, 2021	Dec. 31, 2020
Current assets:
Cash	$ 19,945	$ 59,310
Trade receivables, net	92,960	32,758
Inventories, net	74,131	64,818
Income tax receivable	2,107	4,377
Prepaid expenses and other current assets	5,685	6,063
Total current assets	194,828	167,326
Property and equipment, net	50,605	47,357
Equity method investment	25,460	25,384
Deferred tax assets	345	345
Deferred offering costs	4,684	1,041
Goodwill	115,610	115,750
Intangible assets, net	283,617	289,473
Total assets	675,149	646,676
Current liabilities:
Accounts payable	39,977	29,789
Accounts payable - related party	1,000	500
Current maturities of long-term debt	23,047	13,042
Accrued expenses and other current liabilities	49,679	50,606
Total current liabilities	113,703	93,937
Long-term debt, net of discount and current portion	382,917	208,454
Related party note payable		64,938
Deferred income tax liabilities, net	55,472	55,193
Liability for uncertain tax positions	5,562	5,540
Other long-term liabilities	2,061	1,943
Total liabilities	559,715	430,005
Commitments and contingencies
Stockholders' equity:
Common stock, $0.0001 par value; 500,000,000 shares authorized as of April 3, 2021 and December 31, 2020; 109,673,709 shares issued and outstanding as of April 3, 2021 and December 31, 2020	11	11
Additional paid-in capital	91,943	200,541
Retained earnings	22,298	13,765
Accumulated other comprehensive income	1,182	2,354
Total stockholders' equity	115,434	216,671
Total liabilities and stockholders' equity	$ 675,149	$ 646,676

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Apr. 03, 2021	Dec. 31, 2020
Condensed Consolidated Balance Sheets
Common stock, par value	$ 0.0001	$ 0.0001
Common stock, shares authorized	500,000,000	500,000,000
Common stock, shares issued	109,673,709	109,673,709
Common stock, shares outstanding	109,673,709	109,673,709

Condensed Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended
	Apr. 03, 2021	Mar. 28, 2020
Condensed Consolidated Statements of Operations
Net sales	$ 148,746	$ 51,134
Cost of sales	96,306	41,035
Gross profit	52,440	10,099
Selling, general and administrative expense	27,172	15,432
Amortization	5,595	4,063
Income (loss) from operations	19,673	(9,396)
Other expense (income):
Interest expense	9,056	5,333
Other expense (income), net	(555)	3,741
Total other expense (income), net	8,501	9,074
Earnings from equity method investment	244
Income (loss) before income taxes	11,416	(18,470)
Income tax (benefit) expense	2,883	(3,019)
Net income (loss)	$ 8,533	$ (15,451)
Net income (loss) per share attributable to common stockholders:
Basic and diluted	$ 0.08	$ (0.14)
Weighted-average common shares outstanding - basic and diluted
Basic and diluted	109,673,709	109,673,709

Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands	3 Months Ended
	Apr. 03, 2021	Mar. 28, 2020
Condensed Consolidated Statements of Comprehensive Income (Loss)
Net income (loss)	$ 8,533	$ (15,451)
Other comprehensive loss, net of tax:
Foreign currency translation adjustments	(407)	(1,938)
Total other comprehensive loss, net of tax	(407)	(1,938)
Comprehensive income (loss)	$ 8,126	$ (17,389)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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+ Details

Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands	Common Stock	Additional Paid-in Capital	Retained Earnings (Accumulated Deficit)	Accumulated Other Comprehensive Income (Loss)	Total
Balance, beginning of period at Dec. 31, 2019	$ 11	$ 196,473	$ (2,218)	$ (471)	$ 193,795
Balance, beginning of period (in shares) at Dec. 31, 2019	109,673,709
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)			(15,451)		(15,451)
Foreign currency translation adjustments				(1,938)	(1,938)
Distributions to parent		400			400
Stock-based compensation expense		224			224
Balance, end of period at Mar. 28, 2020	$ 11	196,297	(17,669)	(2,409)	176,230
Balance, end of period (in shares) at Mar. 28, 2020	109,673,709
Balance, beginning of period at Dec. 31, 2020	$ 11	200,541	13,765	2,354	216,671
Balance, beginning of period (in shares) at Dec. 31, 2020	109,673,709
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)			8,533		8,533
Foreign currency translation adjustments				(1,172)	(1,172)
Dividend		(110,033)			(110,033)
Distributions to parent		(29)			(29)
Stock-based compensation expense		1,464			1,464
Balance, end of period at Apr. 03, 2021	$ 11	$ 91,943	$ 22,298	$ 1,182	$ 115,434
Balance, end of period (in shares) at Apr. 03, 2021	109,673,709

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

+ Details

- Definition

Total of all stockholders' equity (deficit) items, net of receivables from officers, directors, owners, and affiliates of the entity which are attributable to the parent. The amount of the economic entity's stockholders' equity attributable to the parent excludes the amount of stockholders' equity which is allocable to that ownership interest in subsidiary equity which is not attributable to the parent (noncontrolling interest, minority interest). This excludes temporary equity and is sometimes called permanent equity.

+ References + Details

Condensed Consolidated Statements of Stockholders' Equity - (Parenthetical)	3 Months Ended
	Apr. 03, 2021 $ / shares
Condensed Consolidated Statements of Stockholders' Equity
Dividend per share	$ 1.00

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Apr. 03, 2021	Mar. 28, 2020
Cash flows from operating activities:
Net income (loss)	$ 8,533	$ (15,451)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation and amortization	7,900	5,755
Amortization of deferred financing costs and debt discount	2,804	912
Stock-based compensation expense	1,464	224
Other non-cash	1,433	739
Earnings from equity method investment	(244)
Distribution received from equity method investment	168
Changes in operating assets and liabilities:
Trade receivables	(60,963)	(13,322)
Inventories	(9,238)	(10,914)
Prepaid expenses and other current assets	119	784
Income tax receivable	(2,107)	(2,866)
Accounts payable	8,642	9,468
Accrued expenses and other current liabilities	(4,074)	(1,652)
Other long-term liabilities	4,545	35
Net cash used in operating activities	(41,018)	(26,288)
Cash flows from investing activities:
Purchases of property and equipment	(4,608)	(2,790)
Proceeds from the sale of property and equipment		1
Net cash used in investing activities	(4,608)	(2,789)
Cash flows from financing activities:
Proceeds from borrowings on the term loan	172,813
Payments on term loan borrowings	(5,762)
Proceeds from borrowings on the revolving credit facility	16,000	5,000
Deferred financing fees paid	(1,250)
Distributions to parent	(29)	(400)
Payment of related party note payable	(64,938)
Dividend to parent	(110,033)
Payments of initial public offering costs	(747)
Net cash provided by financing activities	6,054	4,600
Effect of exchange rate changes on cash	207	(1,694)
Net decrease in cash	(39,365)	(26,171)
Cash at beginning of period	59,310	56,655
Cash at end of period	19,945	30,484
Supplemental cash flow information:
Cash paid for interest	5,892	4,420
Income taxes paid, net	502	63
Supplemental disclosure of non-cash investing and financing activities:
Purchases of property and equipment included in accounts payable and accrued expenses	1,144	$ 269
Capitalized internal-use software included in accounts payable - related party	500
Deferred offering costs included in accrued expenses	$ 2,896

NATURE OF THE BUSINESS	3 Months Ended
NATURE OF THE BUSINESS	Apr. 03, 2021
NATURE OF THE BUSINESS
NATURE OF THE BUSINESS	1. NATURE OF THE BUSINESS Latham Group, Inc. (“the Company”) wholly owns Latham Pool Products, Inc. (“Latham Pool Products”) (together, “Latham”) and is a designer, manufacturer and marketer of in-ground residential swimming pools in North America, Australia and New Zealand. Latham offers a portfolio of pools and related products, including in-ground swimming pools, pool liners and pool covers. Latham Topco, Inc. was incorporated in the State of Delaware on December 6, 2018. Latham Topco, Inc. changed its name to Latham Group, Inc. on March 3, 2021. On December 18, 2018, an investment fund managed by affiliates of Pamplona Capital Management (the “Sponsor”), Wynnchurch Capital, L.P. and management acquired all of our outstanding equity interests through the newly formed entities (the “Acquisition”). On April 27, 2021, the Company completed its initial public offering (the “IPO”), pursuant to which it issued and sold 23,000,000 shares of common stock, inclusive of 3,000,000 shares sold by the Company pursuant to the full exercise of the underwriters’ option to purchase additional shares. The aggregate net proceeds received by the Company from the IPO were $400.1 million, after deducting underwriting discounts and commissions and other offering costs. The Company used the net proceeds to (i) pay down $152.7 million of the Amended Term Loan (as defined below) under the Credit Agreement (as defined below), (ii) repay the $16.0 million outstanding on the Revolving Credit Facility (as defined below), (iii) repurchase 12,264,438 shares of common stock from certain existing shareholders for $216.7 million and (iv) fund general corporate requirements, including working capital, for $14.7 million. Prior to the closing of the Company’s IPO, the Company’s parent entity, Latham Investment Holdings, LP (“Parent”) merged with and into Latham Group, Inc., with Latham Group, Inc. surviving the merger (the “Reorganization”). The purpose of the Reorganization was to reorganize the Company’s structure so that its existing investors would own only common stock rather than limited partnership interests in the Company’s Parent. In connection with the Reorganization, holders of Class A units of the Parent received shares of the Company’s common stock and Class B units of the Parent were exchanged for an economically equivalent number of restricted and unrestricted shares of the Company’s common stock. During the fiscal quarter ended July 3, 2021, the Company recorded a stock-based compensation charge of $49.5 million in connection with the Reorganization due to modifications made to the Class B units upon their exchange for common stock that provided accelerated vesting of certain time-vesting units and removed the performance vesting criteria on the performance-vesting units, which resulted in incremental fair value resulting from the replacement of Class B time-vesting units and performance-vesting units into common stock. Impact of COVID‑19 Pandemic Since the onset of the COVID‑19 pandemic, the Company has been focused on protecting its employees’ health and safety, meeting its customers’ needs as they navigate an uncertain financial and operating environment, working closely with its suppliers to protect its ongoing business operations and rapidly adjusting its short-, medium- and long-term operational plans to proactively and effectively respond to the current and potential future public health crises. The Company continues to monitor the evolving COVID‑19 pandemic and the impact on its business and financial results. We expect the impact of the pandemic on our business and financial results in 2021 will continue to vary by location and depend on numerous evolving factors that we are not able to accurately predict. These factors include the duration and scope of the pandemic, global economic conditions during and after the pandemic, governmental actions that have been taken (or may be taken in the future) in response to the pandemic and changes in customer and supplier behavior in response to the pandemic.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	3 Months Ended
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	Apr. 03, 2021
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited condensed consolidated financial statements and accompanying notes have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). The Company’s unaudited condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Unaudited Interim Financial Information The consolidated balance sheet at December 31, 2020 was derived from audited financial statements but does not include all disclosures required by GAAP. The accompanying unaudited condensed consolidated financial statements as of April 3, 2021 and for the fiscal quarters ended April 3, 2021 and March 28, 2020 have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial statements. Certain information and footnote disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. These condensed consolidated financial statements should be read in conjunction with Latham Group, Inc.’s audited consolidated financial statements and the notes thereto for the year ended December 31, 2020 included in the Company’s Registration Statement on Form S‑1, as amended, File No. 333‑254930 on file with the SEC. In the opinion of management, all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of the Company’s financial position as of April 3, 2021 and results of operations for the fiscal quarters ended April 3, 2021 and March 28, 2020 and cash flows for the fiscal quarters ended April 3, 2021 and March 28, 2020 have been made. The Company’s results of operations for the fiscal quarter ended April 3, 2021 are not necessarily indicative of the results of operations that may be expected for the year ending December 31, 2021. Use of Estimates The preparation of the Company’s condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. The Company bases its estimates on historical experience, known trends and other market-specific or other relevant factors that it believes to be reasonable under the circumstances. Estimates are evaluated on an ongoing basis and revised as there are changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. Seasonality Although the Company generally has demand for its products throughout the year, its business is seasonal and weather is one of the principal external factors affecting the business. Historically, net sales and net income are highest during spring and summer, representing the peak months of swimming pool use, pool installation and remodeling and repair activities. Sales periods having severe weather may also affect net sales. Accounting Policies Refer to the Company’s final prospectus for the IPO filed pursuant to Rule 424(b)(4) under the Securities Act with the SEC on April 26, 2021 (“the Prospectus”) for a discussion of the Company’s accounting policies, as updated below. Equity Method Investments Investments and ownership interests in common stock or in-substance common stock are accounted for under the equity method accounting if the Company has the ability to exercise significant influence over the entity, but does not have a controlling financial interest. Under the equity method, investments are initially recognized at cost and adjusted to reflect the Company’s interest in net earnings, dividends received and other-than-temporary impairments. The Company records its interest in the net earnings of its equity method investee, along with adjustments for amortization of basis differences, investee capital transactions and other comprehensive income (loss), within earnings from equity method investment in the condensed consolidated statements of operations. Basis differences represent differences between the cost of the investment and the underlying equity in net assets of the investment and are generally amortized over the lives of the related assets that gave rise to the underlying basis differences. Profits or losses related to intra-entity sales with its equity method investee are eliminated until realized by the investor or investee. The Company records its proportionate share of earnings or losses of Premier Holdco, LLC (“Premier Pools & Spas”) within earnings from equity method investment in the condensed consolidated statements of operations on a three-month lag. The Company recorded its interest in the net earnings of Premier Pools & Spas of $0.2 million for the period from October 30, 2020 through December 31, 2020, which included a $0.1 million adjustment for the amortization of basis differences, within earnings from equity method investment in the condensed consolidated statements of operations during the fiscal quarter ended April 3, 2021. The Company also received a distribution of $0.2 million during the fiscal quarter ended April 3, 2021. For presentation in the condensed consolidated statements of cash flows, the Company utilizes the cumulative earnings approach for purposes of determining whether distributions should be classified as either a return on investment, which are be included in operating activities, or a return of investment, which would be included in investing activities. Under the cumulative earnings approach, the Company compares the distributions received to its cumulative equity-method earnings since inception. Any distributions received up to the amount of cumulative equity earnings are be considered a return on investment and classified in operating activities. Any excess distributions would be considered a return of investment and classified in investing activities. Equity method goodwill is not amortized or tested for impairment; instead the Company evaluates equity method investments for impairment when events or changes in circumstances indicate that the decline in value below the carrying amount of its equity method investment is determined to be other than temporary. In such a case, the decline in value below the carrying amount of its equity method investment is recognized in the condensed consolidated statements of operations in the period the impairment occurs. Recently Issued Accounting Pronouncements The Company qualifies as “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012 and has elected to “opt in” to the extended transition related to complying with new or revised accounting standards, which means that when a standard is issued or revised and it has different application dates for public and nonpublic companies, the Company will adopt the new or revised standard at the time nonpublic companies adopt the new or revised standard and will do so until such time that the Company either (i) irrevocably elects to “opt out” of such extended transition period or (ii) no longer qualifies as an emerging growth company. The Company may choose to early adopt any new or revised accounting standards whenever such early adoption is permitted for private companies. In February 2016, the FASB issued ASU 2016‑02, Leases (Topic 842) (“ASU 2016‑02”), which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e., lessees and lessors). The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. In addition, a lessee is required to record (i) a right-of-use asset and a lease liability on its balance sheet for all leases with accounting lease terms of more than 12 months regardless of whether it is an operating or financing lease and (ii) lease expense in its consolidated statement of operations for operating leases and amortization and interest expense in its consolidated statement of operations for financing leases. Leases with a term of 12 months or less may be accounted for similar to prior guidance for operating leases today. In July 2018, the FASB issued ASU No. 2018‑11, Leases (Topic 842), which added an optional transition method that allows companies to adopt the standard as of the beginning of the year of adoption as opposed to the earliest comparative period presented. In November 2019, the FASB issued guidance delaying the effective date for all entities, except for public business entities. For nonpublic entities, this guidance is effective for annual periods beginning after December 15, 2020. In June 2020, the FASB issued additional guidance delaying the effective date for all entities, except for public business entities. For public entities, ASU 2016‑02 was effective for annual periods beginning after December 15, 2018, including interim periods within those fiscal years. For nonpublic entities, this guidance is effective for annual periods beginning after December 15, 2021. Early adoption is permitted. The Company is currently evaluating the impact that the adoption of ASU 2016‑02 will have on its consolidated financial statements. In June 2016, the FASB issued ASU 2016‑13, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016‑13”), which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. ASU 2016‑13 replaces the existing incurred loss impairment model with an expected loss model. It also eliminates the concept of other-than-temporary impairment and requires credit losses related to available-for-sale debt securities to be recorded through an allowance for credit losses rather than as a reduction in the amortized cost basis of the securities. These changes will result in earlier recognition of credit losses. In November 2018, the FASB issued ASU 2018‑19, Codification Improvements to Topic 326, Financial Instruments — Credit Losses, which narrowed the scope and changed the effective date for nonpublic entities for ASU 2016‑13. The FASB subsequently issued supplemental guidance within ASU 2019‑05, Financial Instruments — Credit Losses (Topic 326): Targeted Transition Relief (“ASU 2019‑05”). ASU 2019‑05 provides an option to irrevocably elect the fair value option for certain financial assets previously measured at amortized cost basis. For public entities that are SEC filers, excluding entities eligible to be smaller reporting companies, ASU 2016‑13 is effective for annual periods beginning after December 15, 2019, including interim periods within those fiscal years. For all other entities, ASU 2016‑13 is effective for annual periods beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact that the adoption of ASU 2016‑13 will have on its consolidated financial statements. In August 2017, the FASB issued ASU 2017‑12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities (“ASU 2017‑12”), which is intended to improve the financial reporting of hedging relationships to better portray the economic results of an entity’s risk management activities in its consolidated financial statements. In addition to that main objective, the amendments in the update make certain targeted improvements to simplify the application of the hedge accounting guidance in current GAAP. Additional updates to further clarify the guidance in ASU 2017‑12 were issued by the FASB in October 2018 within ASU 2018‑16. For public entities, the amendment is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. For nonpublic entities, ASU 2017‑12 is effective for fiscal years beginning after December 15, 2020 and interim periods beginning after December 15, 2021. Early application is permitted in any interim period after the issuance of the update. The Company is currently evaluating the impact that the adoption of ASU 2017‑12 will have on its consolidated financial statements. In December 2019, the FASB issued ASU 2019‑12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019‑12”), which is intended to simplify various aspects related to accounting for income taxes. ASU 2019‑12 removes certain exceptions to the general principles in ASC 740 and also clarifies and amends existing guidance to improve consistent application. For public entities, ASU 2019‑12 is effective for annual periods beginning after December 15, 2020, and interim periods within those reporting periods. For nonpublic companies, ASU 2019‑12 is effective for annual periods beginning after December 15, 2021, and interim periods within those reporting periods. Early adoption is permitted. The Company is currently evaluating the impact that the adoption of ASU 2019‑12 will have on its consolidated financial statements. In January 2020, the FASB issued ASU 2020‑01, Investments — Equity Securities (Topic 321), Investments — Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) (“ASU 2020‑01”), which is intended to clarify the interaction of the accounting for equity securities under Topic 321 and investments accounted for under the equity method of accounting in Topic 323 and the accounting for certain forward contracts and purchased options accounted for under Topic 815. For public entities, ASU 2020‑01 is effective for annual periods beginning after December 15, 2020, and interim periods within those reporting periods. For nonpublic companies, ASU 2020‑01 is effective for annual periods beginning after December 15, 2021, and interim periods within those reporting periods. The Company is currently evaluating the impact that the adoption of ASU 2020‑01 will have on its consolidated financial statements. In March 2020, the FASB issued ASU 2020‑04, Facilitation of the Effects of Reference Rate Reform on Financial Reporting which provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by the discontinuation of the London Interbank Offered Rate (“LIBOR”) or by another reference rate expected to be discontinued. This guidance is effective for all entities upon issuance on March 12, 2020 and may be applied through December 31, 2022. The expedients and exceptions in this guidance are optional, and the Company is evaluating the potential future financial statement impact of any such expedient or exception that it may elect to apply as the Company evaluates the effects of adopting this guidance on its consolidated financial statements. In January 2021, the FASB issued ASU 2021‑01, Reference Rate Reform (Topic 848): Scope, which clarifies that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. Specifically, this guidance applies to derivative instruments that use an interest rate for margining, discounting, or contract price alignment that is modified as a result of reference rate reform. The ASU became effective as of March 12, 2020 and can be adopted anytime during the period of January 1, 2020 through December 31, 2022. The Company is currently evaluating the impact that the adoption of ASU 2021‑01 will have on its consolidated financial statements.

ACQUISITIONS

3 Months Ended

Apr. 03, 2021

ACQUISITIONS

ACQUISITIONS

3. ACQUISITIONS

GL International, LLC

On October 22, 2020, Latham Pool Products acquired GL International, LLC (“GLI”) for a total purchase price of $79.7 million (the “GLI Acquisition”). The results of GLI’s operations have been included in the condensed consolidated financial statements since that date. GLI specializes in manufacturing custom pool liners and safety covers. As a result, this acquisition expanded the Company’s liner and safety cover product offerings. In connection with the GLI Acquisition, consideration paid was $79.7 million in cash, or $74.7 million net of cash acquired of $5.0 million, and excluding a net working capital adjustment receivable of $0.8 million. The net working capital adjustment receivable was settled during fiscal quarter ended April 3, 2021. The cash consideration was funded from existing cash on hand. The Company incurred $2.4 million in transaction costs.

The Company accounted for the GLI Acquisition using the acquisition method of accounting in accordance with FASB ASC 805, Business Combinations (“ASC 805”). This requires that the assets acquired and liabilities assumed be measured at fair value. The Company estimated, using Level 3 inputs, the fair value of certain fixed assets using a combination of the cost approach and the market approach. Inventories were valued using the comparative sales method, less the cost of disposal. Specific to intangible assets, dealer relationships were valued using the multi-period excess earnings method, whereas trade names were valued using the relief from royalty method. The Company recorded the assets acquired and liabilities assumed at their respective fair values as of the acquisition date.

The following summarizes the purchase price allocation for the GLI Acquisition:


(in thousands)	October 22, 2020
Total consideration	$	79,743
Allocation of purchase price:
Cash		5,007
Trade receivables		10,639
Inventories		11,854
Prepaid expenses and other current assets		3,949
Property and equipment		1,402
Intangible assets		46,700
Total assets acquired		79,551
Accounts payable		3,536
Accrued expenses and other current liabilities		8,853
Other long-term liabilities		524
Total liabilities assumed		12,913
Total fair value of net assets acquired, excluding goodwill:		66,638
Goodwill	$	13,105

The excess of the purchase price over the fair value of the identifiable assets acquired and the liabilities assumed in the acquisition was allocated to goodwill in the amount of $13.1 million. Goodwill resulting from the GLI Acquisition was attributable to the expanded market share and product offerings. Goodwill resulting from the GLI Acquisition is deductible for tax purposes.

The Company allocated a portion of the purchase price to specific intangible asset categories as follows:


			Amortization
	Fair Value		Period
Definite-lived intangible assets:	(in thousands)		(in years)
Trade names	$	9,500	9
Dealer relationships		37,200	8
	$	46,700

Pro Forma Financial Information (Unaudited)

The following pro forma financial information presents the statements of operations of the Company combined with GLI as if the acquisition occurred on January 1, 2020. The pro forma results do not include any anticipated synergies, cost savings or other expected benefits of an acquisition. The pro forma financial information is not necessarily indicative of what the financial results would have been had the acquisition been completed on January 1, 2020 and is not necessarily indicative of the Company’s future financial results.


	Fiscal Quarter Ended
(in thousands)	March 28, 2020
Net sales	$	58,920
Net loss	$	(20,828)

The pro forma financial information presented above has been calculated after adjusting for the results of the GLI Acquisition for the first fiscal quarter ended March 28, 2020 to reflect the accounting effects as a result of the acquisition, including the amortization expense from acquired intangible assets, the depreciation and amortization expense from acquired property and equipment, the additional cost of sales from acquired inventory, interest expense from debt financing, and any related tax effects.

EQUITY METHOD INVESTMENT	3 Months Ended
EQUITY METHOD INVESTMENT	Apr. 03, 2021
EQUITY METHOD INVESTMENT
EQUITY METHOD INVESTMENT	4. EQUITY METHOD INVESTMENT On October 30, 2020, the Company entered into a securities purchase agreement to purchase 28% of the common units of Premier Pools & Spas for $25.4 million. The Company concluded that it holds common stock of Premier Pools & Spas and has the ability to exercise significant influence over Premier Pools & Spas, but does not have a controlling financial interest. Accordingly, the Company accounts for this investment using the equity method of accounting. The Company’s proportionate share of the earnings or losses of the investee are reported as a separate line in the condensed consolidated statements of operations. Premier Pools & Spas is a holding company for its manufacturing and franchising companies including PFC LLC, Premier Franchise Management LLC, Premier Pools Management LLC, and Premier Fiberglass LLC (the “Premier Companies”). The Premier Companies are a leading swimming pool-building brand that uses its franchisee network to sell and install pools around the United States. In connection with Latham’s Investment in Premier Pools & Spas, the Company entered into an exclusive supply agreement with Premier Pools & Spas, the Premier Companies, and Premier Pools & Spas’ franchisees (“Premier Franchisees”) (together, the “Customer”). Premier Pools & Spas does not consolidate the operations of the Premier Franchisees. Per the supply agreement, Latham is the exclusive supplier of the Premier Franchisees for specific pool and pool products. These products include fiberglass products and package pool products. The initial term of the supply agreement is ten years. For the first three years of the supply agreement, the Customer is entitled to a low-teens percentage rebate for all fiberglass pools sold and an additional growth rebate of a low single-digit to low-teens percentage based on year over year sales growth on fiberglass pools (the “Rebates”). The Rebates will be paid directly to Premier Pools Management Corp. Holdco. As of April 3, 2021, the Company’s carrying amount for the equity method investment in Premier Pools & Spas was $25.4 million. In March, Premier Pools & Spas paid the Company a dividend of $0.2 million that is presented on the condensed consolidated statement of cash flows as distributions received from equity method investment. Because of the three-month financial reporting lag, the Company recorded its interest in the net earnings of Premier Pools & Spas for the period from October 30, 2020 through December 31, 2020, along with adjustments for amortization of basis differences and any investee capital transactions, during the fiscal quarter ended April 3, 2021.

FAIR VALUE MEASUREMENTS

3 Months Ended

Apr. 03, 2021

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

5. FAIR VALUE MEASUREMENTS

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. To increase the comparability of fair value measures, the following hierarchy prioritizes the inputs to valuation methodologies used to measure fair value.

Level 1 — Quoted prices in active markets for identical assets or liabilities.

Level 2 — Inputs, other than quoted prices in active markets, that are observable either directly or indirectly.

Level 3 — Unobservable inputs that reflect the Company’s own assumptions incorporated into valuation techniques. These valuations require significant judgment.

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. When there is more than one input at different levels within the hierarchy, the fair value is determined based on the lowest level input that is significant to the fair value measurement in its entirety. Assessment of the significance of a particular input to the fair value measurement in its entirety requires substantial judgment and consideration of factors specific to the asset or liability. Level 3 inputs are inherently difficult to estimate. Changes to these inputs can have significant impact on fair value measurements. Assets and liabilities measured at fair value using Level 3 inputs are based on one or more of the following valuation techniques: market approach, income approach or cost approach. There were no transfers between fair value measurement levels during the fiscal quarters ended April 3, 2021 or March 28, 2020.

Assets and liabilities measured at fair value on a nonrecurring basis

The Company’s non-financial assets such as goodwill, intangible assets and property and equipment are measured at fair value upon acquisition or remeasured to fair value when an impairment charge is recognized. Such fair value measurements are based predominantly on Level 2 and Level 3 inputs.

Assets and liabilities measured at fair value on a recurring basis

On May 31, 2019 (the “Acquisition Date”), Latham Pool Products acquired Narellan Group Pty Limited and its subsidiaries (collectively “Narellan”) for a total purchase price of $35.2 million (the “Narellan Acquisition”). In connection with the Narellan Acquisition, consideration paid included $20.2 million in cash, $7.6 million in equity consideration and $7.4 million of contingent consideration as of the Acquisition Date. The Company agreed to pay the contingent consideration in the form of cash and equity consideration to the seller if certain EBITDA targets were achieved for any of the trailing twelve months periods ended December 31, 2019, June 30, 2020 or the year ended December 31, 2020 (the “Contingent Consideration”). The fair value of the Contingent Consideration at the Acquisition Date was $7.4 million. On September 25, 2020, the Company amended the terms of the Narellan Share Purchase Agreement and settled the Contingent Consideration with the selling shareholders of Narellan based upon estimated EBITDA for the year ended December 31, 2020.

The fair value of the Company’s Contingent Consideration is measured and recorded on the condensed consolidated balance sheets using Level 3 inputs because it is valued based on unobservable inputs and other estimation techniques due to the absence of quoted market prices. The Company values the Contingent Consideration using a Monte Carlo simulation, which relies on management’s projections of EBITDA and the estimated probability of achieving such targets. The change in the fair value of the Contingent Consideration for the fiscal quarter ended March 28, 2020 of $(1.1) million was due to foreign currency translation.

Estimates of fair value are subjective in nature, involve uncertainties and matters of significant judgment, and are made at a specific point in time. Thus, changes in key assumptions from period to period could significantly affect the estimate of fair value.

The Monte Carlo simulation utilized the following unobservable inputs to determine the fair value of the Contingent Consideration as of March 28, 2020:


	Fiscal Quarter Ended
	March 28, 2020
EBITDA risk adjustment	17.30	%
Annual EBITDA volatility	55.00	%
Risk-free rate of return	2.10	%

Pension Plan

The fair value of the benefit plan assets related to the Company’s pension plan is measured and was recorded on the condensed consolidated balance sheets using Level 2 inputs. The fair value of the Company’s plan assets was $1.2 million as of March 28, 2020. During the year ended December 31, 2020, the Company terminated its defined benefit pension plan.

Fair value of financial instruments

The Company considers the carrying amounts of cash, trade receivables, prepaid expenses and other current assets, accounts payable, and accrued expenses and other current liabilities, to approximate fair value due to the short-term maturities of these instruments.

Term loan

The term loan is carried at amortized cost; however, the Company estimates the fair value of the term loan for disclosure purposes. The fair value of the term loan is determined using inputs based on observable market data of a non-public exchange using, which are classified as Level 2 inputs. The following table sets forth the carrying amount and fair value of the term loan (in thousands):


	April 3, 2021				December 31, 2020
	Carrying		Estimated		Carrying		Estimated
	Value		Fair Value		Value		Fair Value
Term loan	$	389,964	$	390,638	$	221,496	$	221,081

Interest rate swap

The Company estimates the fair value of the interest rate swap (see Note 8) on a quarterly basis using Level 2 inputs, including the forward LIBOR curve. The fair value is estimated by comparing (i) the present value of all future monthly fixed rate payments versus (ii) the variable payments based on the forward LIBOR curve. As of April 3, 2021 and December 31, 2020, the Company’s interest rate swap liability was $0.5 million and $0.3 million, respectively, which was recorded within other long-term liabilities on the condensed consolidated balance sheets.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

GOODWILL AND INTANGIBLE ASSETS, NET

3 Months Ended

Apr. 03, 2021

GOODWILL AND INTANGIBLE ASSETS, NET

GOODWILL AND INTANGIBLE ASSETS, NET

6. GOODWILL AND INTANGIBLE ASSETS, NET

Goodwill

The carrying amount of goodwill for the fiscal quarter ended April 3, 2021 and the year ended December 31, 2020 was $115.6 million and $115.8 million, respectively. The change in the carrying value during the fiscal quarter ended April 3, 2021 was solely due to fluctuations in foreign currency exchange rates.

Intangible Assets

Intangible assets, net as of April 3, 2021 consisted of the following (in thousands):


	April 3, 2021
	Gross		Foreign
	Carrying		Currency		Accumulated		Net
	Amount		Translation		Amortization		Amount
Trade names and trademarks	$	135,100	$	912	$	11,808	$	124,204
Patented technology		16,126		134		3,898		12,362
Pool designs		5,728		547		752		5,523
Franchise relationships		1,187		113		546		754
Dealer relationships		160,376		45		20,989		139,432
Non-competition agreements		2,476		—		1,134		1,342
	$	320,993	$	1,751	$	39,127	$	283,617

The Company recognized $5.6 million of amortization expense related to intangible assets during the fiscal quarter ended April 3, 2021.

Intangible assets, net as of December 31, 2020 consisted of the following (in thousands):


	December 31, 2020
	Gross		Foreign
	Carrying		Currency		Accumulated		Net
	Amount		Translation		Amortization		Amount
Trade names and trademarks	$	135,100	$	1,047	$	10,258	$	125,889
Patented technology		16,126		155		3,452		12,829
Pool designs		5,728		629		648		5,709
Franchise relationships		1,187		130		470		847
Dealer relationships		160,376		52		17,697		142,731
Non-competition agreements		2,476		—		1,008		1,468
	$	320,993	$	2,013	$	33,533	$	289,473

The Company recognized $4.1 million of amortization expense related to intangible assets during the fiscal quarter ended March 28, 2020.

The Company estimates that amortization expense related to definite-lived intangible assets will be as follows in each of the next five years and thereafter (in thousands):


	Estimated Future
Year Ended	Amortization Expense
Remainder of fiscal 2021	$	16,364
2022		21,959
2023		21,768
2024		20,948
2025		20,791
Thereafter		181,787
	$	283,617

INVENTORIES, NET

3 Months Ended

Apr. 03, 2021

INVENTORIES, NET

INVENTORIES, NET

7. INVENTORIES, NET

Inventories, net consisted of the following (in thousands):


	April 3,		December 31,
	2021		2020
Raw materials	$	44,472	$	37,010
Finished goods		29,659		27,808
	$	74,131	$	64,818

LONG-TERM DEBT

3 Months Ended

Apr. 03, 2021

LONG-TERM DEBT

LONG-TERM DEBT

8. LONG-TERM DEBT

The components of the Company’s outstanding debt obligations consisted of the following (in thousands):


	April 3,		December 31,
	2021		2020
Term loan	$	397,385	$	228,147
Revolver		16,000		—
Less: Unamortized discount and debt issuance costs		(7,421)		(6,651)
Total debt		405,964		221,496
Less: Current portion of long-term debt		(23,047)		(13,042)
Total long-term debt	$	382,917	$	208,454

Revolving Credit Facility

On December 18, 2018, the Latham Pool Products entered into an agreement (the “Credit Agreement”) with Nomura Corporate Funding Americas, LLC (“Nomura”) that included a revolving line of credit (the “Revolver”) and letters of credit (“Letters of Credit” or collectively with the Revolver, the “Revolving Credit Facility”), as well as a term loan (as described below). The Revolving Credit Facility was utilized to finance ongoing general corporate and working capital needs with the Revolver of up to $30.0 million. The Revolving Credit Facility matures on December 18, 2023.

The Revolving Credit Facility allows for either Eurocurrency borrowings, bearing interest ranging from 4.50% to 4.75%, or base rate borrowings, bearing interest ranging from 3.50% to 3.75% depending on the First Lien Net Leverage Ratio, as defined in the Credit Agreement. A commitment fee accrues on any unused portion of the commitments under the Revolving Credit Facility. The commitment fee is due and payable quarterly in arrears and is equal to the applicable margin times the actual daily amount by which the $30.0 million initial commitment exceeds the sum of the outstanding borrowings under the Revolver and outstanding Letters of Credit obligations. The applicable margin ranges from 0.375% to 0.500% as determined by the Company’s First Lien Net Leverage Ratio as defined in the Credit Agreement.

The Company is required to meet certain financial covenants, including maintaining specific liquidity measurements. There are also negative covenants, including certain restrictions on the Company’s ability to incur additional indebtedness, create liens, make investments, consolidate or merge with other entities, enter into transactions with affiliates and make prepayments. As of April 3, 2021 and December 31, 2020, the Company was in compliance with all financial-related covenants related to the Credit Agreement. There was $16.0 million outstanding as of April 3, 2021 and no amounts outstanding as of December 31, 2020 on the Revolving Credit Facility or Letters of Credit.

Term Loan Facility

On December 18, 2018, in connection with the Acquisition, the Company entered into the Credit Agreement with Nomura to borrow $215.0 million (the “Original Term Loan”). The Company incurred debt issuance costs of $11.5 million related to the transaction.

The Original Term Loan was amended on May 29, 2019, to provide additional borrowings of $23.0 million at a discount of $0.7 million (the “First Amendment”) to fund the Narellan Acquisition. Any portion of the First Amendment not used to fund the Narellan Acquisition was required to be applied to repay the First Amendment in an aggregate amount equal to such portion of the First Amendment, without any premium or penalty.

On August 6, 2020, the Company entered into a Form of Affiliated Lender Assignment and Assumption with Nomura (the “Assignment”). Under the Assignment, the Company repaid $5.0 million of the outstanding principal balance.

On October 14, 2020, the Company entered into a subsequent amendment under the Original Term Loan with Nomura to borrow an additional $20.0 million (the “Second Amendment” and collectively with the Original Term Loan and the First Amendment, the “Term Loan”). The Company accounted for the borrowings under the Second Amendment as new debt and recorded $0.1 million of third-party costs as a direct reduction to the carrying amount of long-term debt on the condensed consolidated balance sheet. There were no financing costs incurred with the Second Amendment. The Term Loan has a maturity date of June 18, 2025. Interest and principal payments are due quarterly.

On January 25, 2021, the Company entered into a subsequent amendment to the Term Loan with Nomura to borrow an additional $175.0 million (the “Third Amendment” and collectively with the “Term Loan”, the “Amended Term Loan”). In connection with the Third Amendment, the Company is required to repay the outstanding principal balance of the Amended Term Loan in fixed quarterly payments of $5.8 million, commencing March 31, 2021. The amendment did not change the maturity date of the Term Loan and the Amended Term Loan bears interest under the same terms as the Term Loan. The Company accounted for $165.0 million of the borrowings under the Third Amendment as new debt and $10.0 million of the borrowings under the Third Amendment as a debt modification. The Company recorded an aggregate of $1.2 million of debt issuance costs as a direct reduction to the carrying amount of long-term debt on the condensed consolidated balance sheet.

The Amended Term Loan allowed for the $175.0 million of proceeds to be distributed to Parent. On February 2, 2021, the Company used the proceeds of the Amended Term Loan to settle in full the note payable to Parent of $64.9 million and to pay a dividend to Parent of $110.0 million.

The Term Loan bears interest at (1) a base rate equal to the highest of (i) the Federal Funds Rate plus 1∕2 of 1%, (ii) the “prime rate” published in the Money Rates section of the Wall Street Journal and (iii) LIBOR plus 1.00% (2) plus a Loan Margin of (i) 6.00% for Eurocurrency Rate Loans and (ii) 5.00% for Base Rate Loans, as defined in the Credit Agreement. Principal payments under the First Amendment were calculated as 0.629% of the outstanding principal balance. Outstanding borrowings at April 3, 2021 and December 31, 2020 were $390.0 million and $221.5 million, respectively, net of discount and debt issuance costs of $7.4 million and $6.7 million, respectively. In connection with the Term Loan, the Company is subject to various financial reporting, financial and other covenants, including maintaining specific liquidity measurements.

As of April 3, 2021, the unamortized debt issuance costs and discount on the Term Loan were $5.6 million and $1.8 million, respectively. As of December 31, 2020, the unamortized debt issuance costs and discount on the Term Loan were $6.3 million and $0.4 million, respectively. The effective interest rate was 9.36% and 8.03% for the fiscal quarter ended April 3, 2021 and year ended December 31, 2020, respectively.

Interest rate risk associated with the Company’s Credit Agreement is managed through an interest rate swap which the Company executed on April 30, 2020. The swap has an effective date of May 18, 2020 and a termination date of May 18, 2023. Under the terms of the swap, the Company fixed its LIBOR borrowing rate at 0.442% on a notional amount of $200.0 million. The interest rate swap is not designated as a hedging instrument for accounting purposes (see Note 2 and Note 5).

The Company recorded interest expense associated with the Revolving Credit Facility, Second Amendment, Third Amendment and interest rate swap, as follows (in thousands):


	April 3, 2021		March 28, 2020
Interest expense	$	5,892	$	4,420
Amortization of debt issuance costs		2,073		859
Amortization of original issue discount		732		54
Interest rate swap		359		—
Total interest expense	$	9,056	$	5,333

Principal payments due on the outstanding debt in the next five fiscal years, excluding any potential payments based on excess cash flow levels, are as follows (in thousands):


	Term Loan
Year Ended	Facility
Remainder of fiscal 2021	$	17,284
2022		23,047
2023		23,047
2024		23,047
2025		310,960
	$	397,385

The obligations under the Credit Agreement are guaranteed by certain wholly owned subsidiaries (the “Guarantors”) of the Company as defined in the security agreement. The obligations under the Credit Agreement are secured by substantially all of the Guarantors’ tangible and intangible assets, including their accounts receivables, equipment, intellectual property, inventory, cash and cash equivalents, deposit accounts and security accounts. The Credit Agreement also restricts payments and other distributions unless certain conditions are met, which could restrict the Company’s ability to pay dividends.

PRODUCT WARRANTIES

3 Months Ended

Apr. 03, 2021

PRODUCT WARRANTIES

PRODUCT WARRANTIES

9. PRODUCT WARRANTIES

The warranty reserve activity consisted of the following (in thousands):


	Fiscal
	Quarter		Year
	Ended		Ended
	April 3,		December
	2021		31, 2020
Balance at the beginning of the period	$	2,882	$	2,846
Accruals for warranties issued		1,706		3,966
Warranty liabilities assumed in GLI Acquisition		—		118
Less: Settlements made (in cash or in kind)		(1,077)		(4,048)
Balance at the end of the period		3,511		2,882
Less: Current portion of accrued warranty costs		(3,313)		(2,705)
Accrued warranty costs – less current portion	$	198	$	177

NET SALES

3 Months Ended

Apr. 03, 2021

NET SALES

NET SALES

10. NET SALES

The following table sets forth the Company’s disaggregation of net sales by product line (in thousands):


	Fiscal Quarter Ended,
	April 3, 2021		March 28, 2020
In-ground Swimming Pools	$	93,643	$	29,458
Covers		24,006		11,011
Liners		31,097		10,665
	$	148,746	$	51,134

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-URI http://asc.fasb.org/topic&trid=49130388

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

INCOME TAXES	3 Months Ended
INCOME TAXES	Apr. 03, 2021
INCOME TAXES
INCOME TAXES	11. INCOME TAXES The effective income tax rate for the fiscal quarter ended April 3, 2021 was 25.26%, compared to 16.34% for the fiscal quarter ended March 28, 2020. The difference between the U.S. federal statutory income tax rate and our effective income tax rate for the tax expense during the fiscal quarter ended April 3, 2021 was impacted primarily by state income tax expense. The difference between the U.S. federal statutory income tax rate and our effective income tax rate for the tax benefit during the fiscal quarter ended March 28, 2020 was primarily attributable to the benefit related to the year-to-date foreign losses in Canada.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References + Details

PROFITS INTEREST UNITS	3 Months Ended
PROFITS INTEREST UNITS	Apr. 03, 2021
PROFITS INTEREST UNITS
PROFITS INTEREST UNITS	12. PROFITS INTEREST UNITS On January 29, 2021 an employee holder of profits interest units terminated his employment with the Company, at which time all 1,055,057 of his performance-vesting units were forfeited. At the time of his termination, the employee held 527,528 of time-vesting units, of which 211,011 time-vesting units were vested. Per the terms of his termination agreement, the Company accelerated the vesting of an additional 105,506 time-vesting units, such that the total time-vesting units vested were equal to 316,517 upon his termination and the remaining 211,011 of unvested time-vesting units were forfeited upon his termination. As the employee’s profits interest units had not vested from an accounting perspective, the retention and immediate vesting of the retained time-vesting units was accounted for as a cancellation of the original award and a new grant under the revised terms. A cumulative catch-up charge of $1.1 million was recorded during the fiscal quarter ended April 3, 2021 to reflect the incremental fair value of the awards as of the date of the modification, as compared to the grant-date fair value. The effective income tax rate for the fiscal quarter ended April 3, 2021 was 25.26%, compared to 16.34% for the fiscal quarter ended March 28, 2020. The difference between the U.S. federal statutory income tax rate and our effective income tax rate for the fiscal quarter ended April 3, 2021 was impacted primarily by state income tax expense . The difference between the U.S. federal statutory income tax rate and our effective income tax rate for the fiscal quarter ended March 28, 2020 was impacted by a variety of factors, primarily attributable to the benefit related to the year-to-date foreign losses in Canada.

NET INCOME (LOSS) PER SHARE

3 Months Ended

Apr. 03, 2021

NET INCOME (LOSS) PER SHARE

NET INCOME (LOSS) PER SHARE

13. NET INCOME (LOSS) PER SHARE

Basic and diluted net income (loss) per share attributable to common stockholders was calculated as follows (in thousands, except share and per share data):


	Fiscal Quarter Ended,
	April 3, 2021		March 28, 2020
Numerator:
Net income (loss) attributable to common stockholders	$	8,533	$	(15,451)
Denominator:
Weighted-average common shares outstanding, basic and diluted		109,673,709		109,673,709
Net income (loss) per share attributable to common stockholders, basic and diluted	$	0.08	$	(0.14)

There were no potentially dilutive securities outstanding during the fiscal quarters ended April 3, 2021 or March 28, 2020.

RELATED PARTY TRANSACTIONS	3 Months Ended
RELATED PARTY TRANSACTIONS	Apr. 03, 2021
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS	14. RELATED PARTY TRANSACTIONS BrightAI Services Starting in 2020, BrightAI rendered services to the Company, for which the cost was capitalized as internal-use software. A co-founder of BrightAI Services has served on the Company’s board of directors since December 9, 2020. During the fiscal quarter ended April 3, 2021 and the year ended December 31, 2020, the Company incurred $0.5 million and $0.5 million, respectively, associated with services performed by BrightAI, which is recorded as construction in progress within property and equipment, net and accounts payable — related party on the condensed consolidated balance sheets as of April 3, 2021. There were no services rendered by BrightAI during the fiscal quarter ended March 28, 2020. Purchase of Treasury Stock On October 14 and 20, 2020, Parent contributed an aggregate of $64.9 million to the Company in exchange for an aggregate of 32,902,113 shares of the Company’s common stock. On December 28, 2020, the Company repurchased and retired those 32,902,113 shares in exchange for a note payable in the amount of $64.9 million. Expense Reimbursement and Management Fees The Company had an expense reimbursement agreement (the “management fee arrangement”) with the Sponsor and Wynnchurch Capital, L.P. for ongoing consulting and advisory services. The management fee arrangement provided for the aggregate payment of up to $1.0 million each year for reimbursement of expenses incurred with services provided and, depending on the extent of services provided, management fees. The management fee arrangement terminated upon consummation of the Company’s IPO. There were no management fees incurred by the Company during the fiscal quarters ended April 3, 2021 and March 28, 2020. As of April 3, 2021 and March 28, 2020, there were no outstanding amounts payable to the Sponsor and Wynnchurch Capital, L.P. Operating Lease In May 2019, in connection with the Narellan Acquisition, the Company assumed an operating lease for the manufacture, sale and storage of swimming pools and associated equipment with Acquigen Pty Ltd, which is owned by an employee who is also a shareholder of the Company. The lease expires in June 2028. As of April 3, 2021 and December 31, 2020, future minimum lease payments totaled $3.7 million and $4.2 million, respectively, related to this lease. The Company recognized $0.1 million of rent expense related to this lease during each of the fiscal quarters ended April 3, 2021 and March 28, 2020, which is recognized within selling, general and administrative expense on the condensed consolidated statements of operations.

SEGMENT AND GEOGRAPHIC INFORMATION

3 Months Ended

Apr. 03, 2021

SEGMENT AND GEOGRAPHIC INFORMATION

SEGMENT AND GEOGRAPHIC INFORMATION

15. SEGMENT AND GEOGRAPHIC INFORMATION

Segment Information

During 2020, the Company made operational changes in how its CODM manages the business including organizational alignment, performance assessment and resource allocation. The segment disclosure is based on the intention to provide the users of the financial statements with a view of the business from the Company’s perspective. The Company conducts its business as one operating and reportable segment that designs, manufactures and markets in-ground swimming pools, liners and covers.

Geographic Information

Net sales by geography is based on the delivery address of the customer as specified in purchase order. Net sales by geographic area was as follows (in thousands):


	Fiscal Quarter Ended
	April 3, 2021		March 28, 2020
Net sales
United States	$	119,070	$	39,006
Canada		21,115		5,942
Australia		5,750		4,117
New Zealand		1,756		647
Other		1,055		1,422
Total	$	148,746	$	51,134

Our long-lived assets by geographic area, which consist of property and equipment, net assets were as follows (in thousands):


	April 3,		December
	2021		31, 2020
Long-lived assets
United States	$	41,458	$	37,680
Canada		2,899		3,050
Australia		4,582		4,979
New Zealand		1,666		1,648
Total	$	50,605	$	47,357

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

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+ Details

SUBSEQUENT EVENTS	3 Months Ended
SUBSEQUENT EVENTS	Apr. 03, 2021
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS	16. SUBSEQUENT EVENTS In connection with the Company’s IPO, on April 12, 2021, the Company’s stockholders approved the 2021 Omnibus Incentive Plan (the ‘‘Omnibus Incentive Plan’’), which became effective on April 22, 2021, the date on which the Registration Statement was declared effective. The Omnibus Incentive Plan provides for the issuance of incentive stock options, non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units and other stock-based and cash-based awards. The maximum aggregate number of shares reserved for issuance under the Omnibus Incentive Plan is 13,170,212 shares. The maximum grant date fair value of cash and equity awards that may be awarded to a non-employee director under the Omnibus Incentive Plan during any one fiscal year, together with any cash fees paid to such non-employee director during such fiscal year, will be $750 thousand. If any award granted under the Omnibus Incentive Plan expires, terminates, or is canceled or forfeited without being settled, vested or exercised, shares of the Company’s common stock subject to such award will again be made available for future grants. Any shares that are surrendered or tendered to pay the exercise price of an award or to satisfy withholding taxes owed, or any shares reserved for issuance, but not issued, with respect to settlement of a stock appreciation right, will not again be available for grant under the Omnibus Incentive Plan. On April 13, 2021, the Company’s certificate of incorporation was amended, which amended and restated certain terms of the certificate of incorporation. Under the amended certificate of incorporation, the Company had authority to issue 500,000,000 shares of common stock, par value $0.0001 per share. On April 12, 2021, the Company’s board of directors declared and on April 13, 2021, the Company effected a 109,673.709-for-one stock split of its issued and outstanding shares of common stock. Accordingly, all share and per share data included in these unaudited condensed consolidated financial statements and notes thereto have been adjusted retroactively to reflect the impact of the amended certificate of incorporation and the stock split. Contemporaneous with the pricing of the Company’s IPO, on April 22, 2021 the Company granted 8,340,126 of restricted stock awards, 341,301 of restricted stock units and 886,862 of option awards under the Omnibus Incentive Plan to employees of the Company. Of the 8,340,126 restricted stock awards granted, (i) 6,799,414 vest every six months in equal installments beginning on December 27, 2021 and ending on December 27, 2023, and (ii) 1,540,712 vest every six months in equal installments, beginning on December 27, 2021 and ending on December 27, 2024. Of the 341,301 restricted stock unit awards granted, (i) 251,828 vest 1/3 on the nine-month anniversary of April 27, 2021 (“the closing of the IPO”), 1/3 on the first anniversary of the closing of the IPO, and 1/3 on the two-year anniversary of the closing of the IPO; (ii) 22,367 vest on the first anniversary of the closing of the IPO; (iii) 51,316 vest on the nine-month anniversary of the closing of the IPO; and (iv) 15,790 vest evenly on each of the first three anniversaries of the closing of the IPO. All 886,862 of the option awards vest 25% annually on each of the first four anniversaries of the closing of the IPO. The option awards were granted with a strike price of $19.00 per share. The tax effects of the Omnibus Incentive Plan have not been considered as part of tax expense for the fiscal quarter ended April 3, 2021. On May 24, 2021, the compensation committee accelerated the vesting of 84,687 shares of restricted stock, which resulted in the Company recording stock-based compensation expense of $1.6 million related to the acceleration. On April 22, 2021, the Company’s certificate of incorporation was further amended and restated to, among other things, increase the authorized shares to 1,000,000,000, of which 900,000,000 are shares of common stock, par value $0.0001 per share and 100,000,000 are shares of preferred stock, par value 0.0001 per share.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	3 Months Ended
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	Apr. 03, 2021
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation	Basis of Presentation The accompanying unaudited condensed consolidated financial statements and accompanying notes have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). The Company’s unaudited condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Unaudited Interim Financial Information The consolidated balance sheet at December 31, 2020 was derived from audited financial statements but does not include all disclosures required by GAAP. The accompanying unaudited condensed consolidated financial statements as of April 3, 2021 and for the fiscal quarters ended April 3, 2021 and March 28, 2020 have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial statements. Certain information and footnote disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. These condensed consolidated financial statements should be read in conjunction with Latham Group, Inc.’s audited consolidated financial statements and the notes thereto for the year ended December 31, 2020 included in the Company’s Registration Statement on Form S‑1, as amended, File No. 333‑254930 on file with the SEC. In the opinion of management, all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of the Company’s financial position as of April 3, 2021 and results of operations for the fiscal quarters ended April 3, 2021 and March 28, 2020 and cash flows for the fiscal quarters ended April 3, 2021 and March 28, 2020 have been made. The Company’s results of operations for the fiscal quarter ended April 3, 2021 are not necessarily indicative of the results of operations that may be expected for the year ending December 31, 2021.
Use of Estimates	Use of Estimates The preparation of the Company’s condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. The Company bases its estimates on historical experience, known trends and other market-specific or other relevant factors that it believes to be reasonable under the circumstances. Estimates are evaluated on an ongoing basis and revised as there are changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known.
Seasonality	Seasonality Although the Company generally has demand for its products throughout the year, its business is seasonal and weather is one of the principal external factors affecting the business. Historically, net sales and net income are highest during spring and summer, representing the peak months of swimming pool use, pool installation and remodeling and repair activities. Sales periods having severe weather may also affect net sales. Accounting Policies Refer to the Company’s final prospectus for the IPO filed pursuant to Rule 424(b)(4) under the Securities Act with the SEC on April 26, 2021 (“the Prospectus”) for a discussion of the Company’s accounting policies, as updated below.
Equity Method Investments	Equity Method Investments Investments and ownership interests in common stock or in-substance common stock are accounted for under the equity method accounting if the Company has the ability to exercise significant influence over the entity, but does not have a controlling financial interest. Under the equity method, investments are initially recognized at cost and adjusted to reflect the Company’s interest in net earnings, dividends received and other-than-temporary impairments. The Company records its interest in the net earnings of its equity method investee, along with adjustments for amortization of basis differences, investee capital transactions and other comprehensive income (loss), within earnings from equity method investment in the condensed consolidated statements of operations. Basis differences represent differences between the cost of the investment and the underlying equity in net assets of the investment and are generally amortized over the lives of the related assets that gave rise to the underlying basis differences. Profits or losses related to intra-entity sales with its equity method investee are eliminated until realized by the investor or investee. The Company records its proportionate share of earnings or losses of Premier Holdco, LLC (“Premier Pools & Spas”) within earnings from equity method investment in the condensed consolidated statements of operations on a three-month lag. The Company recorded its interest in the net earnings of Premier Pools & Spas of $0.2 million for the period from October 30, 2020 through December 31, 2020, which included a $0.1 million adjustment for the amortization of basis differences, within earnings from equity method investment in the condensed consolidated statements of operations during the fiscal quarter ended April 3, 2021. The Company also received a distribution of $0.2 million during the fiscal quarter ended April 3, 2021. For presentation in the condensed consolidated statements of cash flows, the Company utilizes the cumulative earnings approach for purposes of determining whether distributions should be classified as either a return on investment, which are be included in operating activities, or a return of investment, which would be included in investing activities. Under the cumulative earnings approach, the Company compares the distributions received to its cumulative equity-method earnings since inception. Any distributions received up to the amount of cumulative equity earnings are be considered a return on investment and classified in operating activities. Any excess distributions would be considered a return of investment and classified in investing activities. Equity method goodwill is not amortized or tested for impairment; instead the Company evaluates equity method investments for impairment when events or changes in circumstances indicate that the decline in value below the carrying amount of its equity method investment is determined to be other than temporary. In such a case, the decline in value below the carrying amount of its equity method investment is recognized in the condensed consolidated statements of operations in the period the impairment occurs.
Recently Issued Accounting Pronouncements	Recently Issued Accounting Pronouncements The Company qualifies as “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012 and has elected to “opt in” to the extended transition related to complying with new or revised accounting standards, which means that when a standard is issued or revised and it has different application dates for public and nonpublic companies, the Company will adopt the new or revised standard at the time nonpublic companies adopt the new or revised standard and will do so until such time that the Company either (i) irrevocably elects to “opt out” of such extended transition period or (ii) no longer qualifies as an emerging growth company. The Company may choose to early adopt any new or revised accounting standards whenever such early adoption is permitted for private companies. In February 2016, the FASB issued ASU 2016‑02, Leases (Topic 842) (“ASU 2016‑02”), which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e., lessees and lessors). The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. In addition, a lessee is required to record (i) a right-of-use asset and a lease liability on its balance sheet for all leases with accounting lease terms of more than 12 months regardless of whether it is an operating or financing lease and (ii) lease expense in its consolidated statement of operations for operating leases and amortization and interest expense in its consolidated statement of operations for financing leases. Leases with a term of 12 months or less may be accounted for similar to prior guidance for operating leases today. In July 2018, the FASB issued ASU No. 2018‑11, Leases (Topic 842), which added an optional transition method that allows companies to adopt the standard as of the beginning of the year of adoption as opposed to the earliest comparative period presented. In November 2019, the FASB issued guidance delaying the effective date for all entities, except for public business entities. For nonpublic entities, this guidance is effective for annual periods beginning after December 15, 2020. In June 2020, the FASB issued additional guidance delaying the effective date for all entities, except for public business entities. For public entities, ASU 2016‑02 was effective for annual periods beginning after December 15, 2018, including interim periods within those fiscal years. For nonpublic entities, this guidance is effective for annual periods beginning after December 15, 2021. Early adoption is permitted. The Company is currently evaluating the impact that the adoption of ASU 2016‑02 will have on its consolidated financial statements. In June 2016, the FASB issued ASU 2016‑13, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016‑13”), which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. ASU 2016‑13 replaces the existing incurred loss impairment model with an expected loss model. It also eliminates the concept of other-than-temporary impairment and requires credit losses related to available-for-sale debt securities to be recorded through an allowance for credit losses rather than as a reduction in the amortized cost basis of the securities. These changes will result in earlier recognition of credit losses. In November 2018, the FASB issued ASU 2018‑19, Codification Improvements to Topic 326, Financial Instruments — Credit Losses, which narrowed the scope and changed the effective date for nonpublic entities for ASU 2016‑13. The FASB subsequently issued supplemental guidance within ASU 2019‑05, Financial Instruments — Credit Losses (Topic 326): Targeted Transition Relief (“ASU 2019‑05”). ASU 2019‑05 provides an option to irrevocably elect the fair value option for certain financial assets previously measured at amortized cost basis. For public entities that are SEC filers, excluding entities eligible to be smaller reporting companies, ASU 2016‑13 is effective for annual periods beginning after December 15, 2019, including interim periods within those fiscal years. For all other entities, ASU 2016‑13 is effective for annual periods beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact that the adoption of ASU 2016‑13 will have on its consolidated financial statements. In August 2017, the FASB issued ASU 2017‑12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities (“ASU 2017‑12”), which is intended to improve the financial reporting of hedging relationships to better portray the economic results of an entity’s risk management activities in its consolidated financial statements. In addition to that main objective, the amendments in the update make certain targeted improvements to simplify the application of the hedge accounting guidance in current GAAP. Additional updates to further clarify the guidance in ASU 2017‑12 were issued by the FASB in October 2018 within ASU 2018‑16. For public entities, the amendment is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. For nonpublic entities, ASU 2017‑12 is effective for fiscal years beginning after December 15, 2020 and interim periods beginning after December 15, 2021. Early application is permitted in any interim period after the issuance of the update. The Company is currently evaluating the impact that the adoption of ASU 2017‑12 will have on its consolidated financial statements. In December 2019, the FASB issued ASU 2019‑12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019‑12”), which is intended to simplify various aspects related to accounting for income taxes. ASU 2019‑12 removes certain exceptions to the general principles in ASC 740 and also clarifies and amends existing guidance to improve consistent application. For public entities, ASU 2019‑12 is effective for annual periods beginning after December 15, 2020, and interim periods within those reporting periods. For nonpublic companies, ASU 2019‑12 is effective for annual periods beginning after December 15, 2021, and interim periods within those reporting periods. Early adoption is permitted. The Company is currently evaluating the impact that the adoption of ASU 2019‑12 will have on its consolidated financial statements. In January 2020, the FASB issued ASU 2020‑01, Investments — Equity Securities (Topic 321), Investments — Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) (“ASU 2020‑01”), which is intended to clarify the interaction of the accounting for equity securities under Topic 321 and investments accounted for under the equity method of accounting in Topic 323 and the accounting for certain forward contracts and purchased options accounted for under Topic 815. For public entities, ASU 2020‑01 is effective for annual periods beginning after December 15, 2020, and interim periods within those reporting periods. For nonpublic companies, ASU 2020‑01 is effective for annual periods beginning after December 15, 2021, and interim periods within those reporting periods. The Company is currently evaluating the impact that the adoption of ASU 2020‑01 will have on its consolidated financial statements. In March 2020, the FASB issued ASU 2020‑04, Facilitation of the Effects of Reference Rate Reform on Financial Reporting which provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by the discontinuation of the London Interbank Offered Rate (“LIBOR”) or by another reference rate expected to be discontinued. This guidance is effective for all entities upon issuance on March 12, 2020 and may be applied through December 31, 2022. The expedients and exceptions in this guidance are optional, and the Company is evaluating the potential future financial statement impact of any such expedient or exception that it may elect to apply as the Company evaluates the effects of adopting this guidance on its consolidated financial statements. In January 2021, the FASB issued ASU 2021‑01, Reference Rate Reform (Topic 848): Scope, which clarifies that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. Specifically, this guidance applies to derivative instruments that use an interest rate for margining, discounting, or contract price alignment that is modified as a result of reference rate reform. The ASU became effective as of March 12, 2020 and can be adopted anytime during the period of January 1, 2020 through December 31, 2022. The Company is currently evaluating the impact that the adoption of ASU 2021‑01 will have on its consolidated financial statements.

ACQUISITIONS (Tables)

3 Months Ended

Apr. 03, 2021

ACQUISITIONS

Summary of purchase price allocation


(in thousands)	October 22, 2020
Total consideration	$	79,743
Allocation of purchase price:
Cash		5,007
Trade receivables		10,639
Inventories		11,854
Prepaid expenses and other current assets		3,949
Property and equipment		1,402
Intangible assets		46,700
Total assets acquired		79,551
Accounts payable		3,536
Accrued expenses and other current liabilities		8,853
Other long-term liabilities		524
Total liabilities assumed		12,913
Total fair value of net assets acquired, excluding goodwill:		66,638
Goodwill	$	13,105

Schedule of purchase price to specific intangible asset categories


			Amortization
	Fair Value		Period
Definite-lived intangible assets:	(in thousands)		(in years)
Trade names	$	9,500	9
Dealer relationships		37,200	8
	$	46,700

Schedule of pro forma financial information


	Fiscal Quarter Ended
(in thousands)	March 28, 2020
Net sales	$	58,920
Net loss	$	(20,828)

FAIR VALUE MEASUREMENTS (Tables)

3 Months Ended

Apr. 03, 2021

Contingent consideration

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Schedule of significant unobservable inputs for fair value measurements


	Fiscal Quarter Ended
	March 28, 2020
EBITDA risk adjustment	17.30	%
Annual EBITDA volatility	55.00	%
Risk-free rate of return	2.10	%

Term loan

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Schedule of financial liabilities at fair value on a recurring basis

The following table sets forth the carrying amount and fair value of the term loan (in thousands):


	April 3, 2021				December 31, 2020
	Carrying		Estimated		Carrying		Estimated
	Value		Fair Value		Value		Fair Value
Term loan	$	389,964	$	390,638	$	221,496	$	221,081

GOODWILL AND INTANGIBLE ASSETS, NET (Tables)

3 Months Ended

Apr. 03, 2021

GOODWILL AND INTANGIBLE ASSETS, NET

Schedule of Intangible assets

Intangible assets, net as of April 3, 2021 consisted of the following (in thousands):


	April 3, 2021
	Gross		Foreign
	Carrying		Currency		Accumulated		Net
	Amount		Translation		Amortization		Amount
Trade names and trademarks	$	135,100	$	912	$	11,808	$	124,204
Patented technology		16,126		134		3,898		12,362
Pool designs		5,728		547		752		5,523
Franchise relationships		1,187		113		546		754
Dealer relationships		160,376		45		20,989		139,432
Non-competition agreements		2,476		—		1,134		1,342
	$	320,993	$	1,751	$	39,127	$	283,617

Intangible assets, net as of December 31, 2020 consisted of the following (in thousands):


	December 31, 2020
	Gross		Foreign
	Carrying		Currency		Accumulated		Net
	Amount		Translation		Amortization		Amount
Trade names and trademarks	$	135,100	$	1,047	$	10,258	$	125,889
Patented technology		16,126		155		3,452		12,829
Pool designs		5,728		629		648		5,709
Franchise relationships		1,187		130		470		847
Dealer relationships		160,376		52		17,697		142,731
Non-competition agreements		2,476		—		1,008		1,468
	$	320,993	$	2,013	$	33,533	$	289,473

Schedule of estimated amortization expense related to definite-lived intangible assets

The Company estimates that amortization expense related to definite-lived intangible assets will be as follows in each of the next five years and thereafter (in thousands):


	Estimated Future
Year Ended	Amortization Expense
Remainder of fiscal 2021	$	16,364
2022		21,959
2023		21,768
2024		20,948
2025		20,791
Thereafter		181,787
	$	283,617

INVENTORIES, NET (Tables)

3 Months Ended

Apr. 03, 2021

INVENTORIES, NET

Schedule of inventories, net

Inventories, net consisted of the following (in thousands):


	April 3,		December 31,
	2021		2020
Raw materials	$	44,472	$	37,010
Finished goods		29,659		27,808
	$	74,131	$	64,818

LONG-TERM DEBT (Tables)

3 Months Ended

Apr. 03, 2021

LONG-TERM DEBT

Components of the Company's outstanding debt obligations

The components of the Company’s outstanding debt obligations consisted of the following (in thousands):


	April 3,		December 31,
	2021		2020
Term loan	$	397,385	$	228,147
Revolver		16,000		—
Less: Unamortized discount and debt issuance costs		(7,421)		(6,651)
Total debt		405,964		221,496
Less: Current portion of long-term debt		(23,047)		(13,042)
Total long-term debt	$	382,917	$	208,454

Components of interest expense

The Company recorded interest expense associated with the Revolving Credit Facility, Second Amendment, Third Amendment and interest rate swap, as follows (in thousands):


	April 3, 2021		March 28, 2020
Interest expense	$	5,892	$	4,420
Amortization of debt issuance costs		2,073		859
Amortization of original issue discount		732		54
Interest rate swap		359		—
Total interest expense	$	9,056	$	5,333

Principal payments due on the outstanding debt

Principal payments due on the outstanding debt in the next five fiscal years, excluding any potential payments based on excess cash flow levels, are as follows (in thousands):


	Term Loan
Year Ended	Facility
Remainder of fiscal 2021	$	17,284
2022		23,047
2023		23,047
2024		23,047
2025		310,960
	$	397,385

- Definition

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02.22)
-URI http://asc.fasb.org/extlink&oid=120391452&loc=d3e13212-122682

Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 1A
-URI http://asc.fasb.org/extlink&oid=119993939&loc=d3e28541-108399

Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 6
-URI http://asc.fasb.org/extlink&oid=109259400&loc=d3e21506-112644

Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08.(e),(f))
-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

Reference 5: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=119993939&loc=d3e28551-108399

Reference 6: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 7
-URI http://asc.fasb.org/extlink&oid=109259400&loc=d3e21521-112644

Reference 7: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=109259400&loc=d3e21538-112644

Reference 8: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 470
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=75038535&loc=d3e64711-112823

Reference 9: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 55
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=114775985&loc=d3e28878-108400

Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=109259400&loc=d3e21475-112644

+ Details

PRODUCT WARRANTIES (Tables)

3 Months Ended

Apr. 03, 2021

PRODUCT WARRANTIES

Warranty reserve activity

The warranty reserve activity consisted of the following (in thousands):


	Fiscal
	Quarter		Year
	Ended		Ended
	April 3,		December
	2021		31, 2020
Balance at the beginning of the period	$	2,882	$	2,846
Accruals for warranties issued		1,706		3,966
Warranty liabilities assumed in GLI Acquisition		—		118
Less: Settlements made (in cash or in kind)		(1,077)		(4,048)
Balance at the end of the period		3,511		2,882
Less: Current portion of accrued warranty costs		(3,313)		(2,705)
Accrued warranty costs – less current portion	$	198	$	177

NET SALES (Tables)

3 Months Ended

Apr. 03, 2021

NET SALES

Summary of disaggregation of net sales by product line

The following table sets forth the Company’s disaggregation of net sales by product line (in thousands):


	Fiscal Quarter Ended,
	April 3, 2021		March 28, 2020
In-ground Swimming Pools	$	93,643	$	29,458
Covers		24,006		11,011
Liners		31,097		10,665
	$	148,746	$	51,134

NET INCOME (LOSS) PER SHARE (Tables)

3 Months Ended

Apr. 03, 2021

NET INCOME (LOSS) PER SHARE

Basic and diluted earnings (loss) per share

Basic and diluted net income (loss) per share attributable to common stockholders was calculated as follows (in thousands, except share and per share data):


	Fiscal Quarter Ended,
	April 3, 2021		March 28, 2020
Numerator:
Net income (loss) attributable to common stockholders	$	8,533	$	(15,451)
Denominator:
Weighted-average common shares outstanding, basic and diluted		109,673,709		109,673,709
Net income (loss) per share attributable to common stockholders, basic and diluted	$	0.08	$	(0.14)

SEGMENT AND GEOGRAPHIC INFORMATION (Tables)

3 Months Ended

Apr. 03, 2021

SEGMENT AND GEOGRAPHIC INFORMATION

Net sales by geography

Net sales by geography is based on the delivery address of the customer as specified in purchase order. Net sales by geographic area was as follows (in thousands):


	Fiscal Quarter Ended
	April 3, 2021		March 28, 2020
Net sales
United States	$	119,070	$	39,006
Canada		21,115		5,942
Australia		5,750		4,117
New Zealand		1,756		647
Other		1,055		1,422
Total	$	148,746	$	51,134

Long-lived assets by geographic area

Our long-lived assets by geographic area, which consist of property and equipment, net assets were as follows (in thousands):


	April 3,		December
	2021		31, 2020
Long-lived assets
United States	$	41,458	$	37,680
Canada		2,899		3,050
Australia		4,582		4,979
New Zealand		1,666		1,648
Total	$	50,605	$	47,357

NATURE OF THE BUSINESS (Details) - USD ($) $ in Thousands			3 Months Ended
NATURE OF THE BUSINESS (Details) - USD ($) $ in Thousands	Apr. 27, 2021	Aug. 06, 2020	Jul. 03, 2021	Apr. 03, 2021
Subsequent Event [Line Items]
Repayment of long term debt				$ 5,762
Subsequent Event
Subsequent Event [Line Items]
Number of shares Repurchased	12,264,438
Amount paid for repurchase of shares	$ 216,700
Funding for working capital requirement	$ 14,700
IPO
Subsequent Event [Line Items]
One-time expense in connection with the Reorganization			$ 49,500
IPO \| Subsequent Event
Subsequent Event [Line Items]
Shares sold	23,000,000
Net proceeds from the IPO	$ 400,100
Underwriters Option \| Subsequent Event
Subsequent Event [Line Items]
Shares sold	3,000,000
Term loan
Subsequent Event [Line Items]
Repayment of long term debt		$ 5,000
Term loan \| Subsequent Event
Subsequent Event [Line Items]
Repayment of long term debt	$ 152,700
Revolver \| Subsequent Event
Subsequent Event [Line Items]
Repayment of long term debt	$ 16,000

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) $ in Thousands	2 Months Ended	3 Months Ended
	Dec. 31, 2020	Apr. 03, 2021
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Income (Loss) from Equity Method Investments	$ 200	$ 244
Adjustment for the amortization of basis differences	$ 100
Distribution received from equity method investment		$ 168

ACQUISITIONS (Details) - USD ($) $ in Thousands	Oct. 22, 2020	Apr. 03, 2021	Dec. 31, 2020
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract]
Carrying amount of goodwill		$ 115,610	$ 115,750
GL International, LLC
Business Acquisition [Line Items]
Total purchase price	$ 79,700
Total purchase price in cash	79,700
Total purchase price, net of cash acquired	74,700
Cash acquired	5,000
Net working capital adjustment receivable excluded from consideration paid	800
Transaction costs		2,400
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract]
Total consideration	79,743
Cash	5,007
Trade receivables	10,639
Inventories	11,854
Prepaid expenses and other current assets	3,949
Property and equipment	1,402
Intangible assets	46,700
Total assets acquired	79,551
Accounts payable	3,536
Accrued expenses and other current liabilities	8,853
Other long-term liabilities	524
Total liabilities assumed	12,913
Total fair value of net assets acquired, excluding goodwill:	66,638
Carrying amount of goodwill	$ 13,105	$ 13,100

ACQUISITIONS - Financial Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 03, 2021	Mar. 28, 2020
Business Acquisition, Pro Forma Information [Abstract]
Net sales		$ 58,920
Net loss		$ (20,828)
GL International, LLC
Acquired Finite-Lived Intangible Assets [Line Items]
Fair Value	$ 46,700
Trade names \| GL International, LLC
Acquired Finite-Lived Intangible Assets [Line Items]
Fair Value	$ 9,500
Amortization Period	9 years
Dealer relationships \| GL International, LLC
Acquired Finite-Lived Intangible Assets [Line Items]
Fair Value	$ 37,200
Amortization Period	8 years

EQUITY METHOD INVESTMENT (Details) - USD ($) $ in Thousands		1 Months Ended	2 Months Ended	3 Months Ended
EQUITY METHOD INVESTMENT (Details) - USD ($) $ in Thousands	Oct. 30, 2020	Mar. 31, 2021	Dec. 31, 2020	Apr. 03, 2021
Schedule of Equity Method Investments [Line Items]
Equity method investment			$ 25,384	$ 25,460
Distributions received from equity method investment				168
Premier Pools & Spas
Schedule of Equity Method Investments [Line Items]
Ownership percentage	28.00%
Consideration paid	$ 25,400			$ 25,400
Term of the supply agreement			3 months	10 years
Period defined in agreement for calculating percentage of rebates				3 years
Distributions received from equity method investment		$ 200

FAIR VALUE MEASUREMENTS - Assets and liabilities measured at fair value on a recurring basis (Details) $ in Millions	May 31, 2019 USD ($)	Mar. 28, 2020 USD ($)
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value of plan assets		$ 1.2
EBITDA risk adjustment
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Measurement inputs		17.30
Annual EBITDA volatility
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Measurement inputs		55.00
Risk-free rate of return
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Measurement inputs		2.10
Contingent consideration
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value of contingent consideration as of the acquisition date	$ 7.4
Change in the fair value of the Contingent Consideration	7.4
Level 3 \| Contingent consideration
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value of contingent consideration as of the acquisition date		$ 1.1
Narellan Acquisition
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash consideration	35.2
Narellan Acquisition \| Contingent consideration
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash consideration	20.2
Equity consideration	$ 7.6

FAIR VALUE MEASUREMENTS - Fair value of financial instruments (Details) - Level 2 - USD ($) $ in Thousands	Apr. 03, 2021	Dec. 31, 2020
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Derivative liabilities	$ 500	$ 300
Carrying Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Amount	389,964	221,496
Estimated Fair Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Amount	$ 390,638	$ 221,081

GOODWILL AND INTANGIBLE ASSETS, NET - Goodwill (Details) - USD ($) $ in Thousands	Apr. 03, 2021	Dec. 31, 2020
GOODWILL AND INTANGIBLE ASSETS, NET
Carrying amount of goodwill	$ 115,610	$ 115,750

GOODWILL AND INTANGIBLE ASSETS, NET - Intangible Assets (Details) - USD ($) $ in Thousands	3 Months Ended		12 Months Ended
	Apr. 03, 2021	Mar. 28, 2020	Dec. 31, 2020
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 320,993		$ 320,993
Foreign Currency Translation	1,751		2,013
Accumulated Amortization	39,127		33,533
Net Amount	283,617		289,473
Amortization of Intangible Assets	5,595	$ 4,063
Trade names and trademarks
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	135,100		135,100
Foreign Currency Translation	912		1,047
Accumulated Amortization	11,808		10,258
Net Amount	124,204		125,889
Patented technology
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	16,126		16,126
Foreign Currency Translation	134		155
Accumulated Amortization	3,898		3,452
Net Amount	12,362		12,829
Pool designs
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	5,728		5,728
Foreign Currency Translation	547		629
Accumulated Amortization	752		648
Net Amount	5,523		5,709
Franchise relationships
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	1,187		1,187
Foreign Currency Translation	113		130
Accumulated Amortization	546		470
Net Amount	754		847
Dealer relationships
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	160,376		160,376
Foreign Currency Translation	45		52
Accumulated Amortization	20,989		17,697
Net Amount	139,432		142,731
Non-competition agreements
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	2,476		2,476
Accumulated Amortization	1,134		1,008
Net Amount	$ 1,342		$ 1,468

GOODWILL AND INTANGIBLE ASSETS, NET - Amortization Expense (Details) - USD ($) $ in Thousands	Apr. 03, 2021	Dec. 31, 2020
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract]
Remainder of fiscal 2021	$ 16,364
2022	21,959
2023	21,768
2024	20,948
2025	20,791
Thereafter	181,787
Total	$ 283,617	$ 289,473

INVENTORIES, NET (Details) - USD ($) $ in Thousands	Apr. 03, 2021	Dec. 31, 2020
INVENTORIES, NET
Raw materials	$ 44,472	$ 37,010
Finished goods	29,659	27,808
Inventory, Net, Total	$ 74,131	$ 64,818

LONG-TERM DEBT (Details) - USD ($) $ in Thousands	Apr. 03, 2021	Dec. 31, 2020
Debt Instrument [Line Items]
Debt, principal amount outstanding	$ 16,000	$ 0
Less: Unamortized discount and debt issuance costs	(7,421)	(6,651)
Total debt	405,964	221,496
Less: Current portion of long-term debt	(23,047)	(13,042)
Total long-term debt	382,917	208,454
Term loan
Debt Instrument [Line Items]
Debt, principal amount outstanding	397,385	228,147
Total debt	7,400	$ 6,700
Revolver
Debt Instrument [Line Items]
Debt, principal amount outstanding	$ 16,000

LONG-TERM DEBT - Revolving Credit Facility (Details) - USD ($) $ in Thousands	Dec. 18, 2018	Apr. 03, 2021	Dec. 31, 2020
Debt Instrument [Line Items]
Debt, principal amount outstanding		$ 16,000	$ 0
Minimum
Debt Instrument [Line Items]
Commitment fee rate range, depending on leverage ratio	0.375%
Maximum
Debt Instrument [Line Items]
Commitment fee rate range, depending on leverage ratio	0.50%
Revolver
Debt Instrument [Line Items]
Borrowing capacity	$ 30,000
Debt, principal amount outstanding		$ 16,000
Eurocurrency \| Minimum
Debt Instrument [Line Items]
Interest rate range, depending on leverage ratio	4.50%
Eurocurrency \| Maximum
Debt Instrument [Line Items]
Interest rate range, depending on leverage ratio	4.75%
Base \| Minimum
Debt Instrument [Line Items]
Interest rate range, depending on leverage ratio	3.50%
Base \| Maximum
Debt Instrument [Line Items]
Interest rate range, depending on leverage ratio	3.75%

LONG-TERM DEBT - Term Loan Facility (Details) - USD ($) $ in Thousands						3 Months Ended	12 Months Ended
	Feb. 02, 2021	Jan. 25, 2021	Oct. 14, 2020	Aug. 06, 2020	Dec. 18, 2018	Apr. 03, 2021	Dec. 31, 2020	May 29, 2019
Debt Instrument [Line Items]
Additional borrowings under amendment								$ 23,000
Repayment of debt						$ 5,762
Proceeds used to repay note to Parent						64,938
Proceeds used to pay dividend to Parent	$ 110,000
Amount outstanding, net of discount and issuance costs						$ 405,964	$ 221,496
Effective interest rate						9.36%	8.03%
Term loan
Debt Instrument [Line Items]
Original term loan					$ 215,000
Debt issuance costs incurred		$ 1,200	$ 100		$ 11,500
Additional borrowings under amendment		175,000	$ 20,000
Debt discount						$ 1,800	$ 400	700
Repayment of debt				$ 5,000
Repayment amount to be paid quarterly		5,800
Borrowings treated as principal		165,000
Borrowings treated as debt modification		10,000
Proceeds used to repay note to Parent	$ 64,900	$ 175,000
Principal payments calculated as percent of outstanding principal						0.629%
Outstanding Borrowings						$ 390,000	221,500
Amount outstanding, net of discount and issuance costs						7,400	6,700
Unamortized debt issuance costs						5,600	6,300
Unamortized discount						$ 1,800	$ 400	$ 700
Term loan \| Federal Funds Rate
Debt Instrument [Line Items]
Interest added to the specified index rate						5.00%
Term loan \| LIBOR
Debt Instrument [Line Items]
Interest added to the specified index rate						1.00%
Eurocurrency \| Term loan
Debt Instrument [Line Items]
Interest added to the specified index rate						6.00%
Base \| Term loan
Debt Instrument [Line Items]
Interest added to the specified index rate						5.00%

LONG-TERM DEBT - Interest rate swap (Details) - Interest rate swap $ in Millions	May 18, 2020 USD ($)
Derivative [Line Items]
LIBOR borrowings fixed interest rate	0.442
LIBOR borrowings hedged	$ 200.0

LONG-TERM DEBT - Amendments and Interest rate swap (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 03, 2021	Mar. 28, 2020
LONG-TERM DEBT
Interest expense	$ 5,892	$ 4,420
Amortization of debt issuance costs	2,073	859
Amortization of original issue discount	732	54
Interest rate swap	359
Total interest expense	$ 9,056	$ 5,333

LONG-TERM DEBT - Principal payments due (Details) - USD ($) $ in Thousands	Apr. 03, 2021	Dec. 31, 2020
Principal payments due
Total payments due	$ 16,000	$ 0
Term loan
Principal payments due
Remainder of fiscal 2021	17,284
2022	23,047
2023	23,047
2024	23,047
2025	310,960
Total payments due	$ 397,385	$ 228,147

PRODUCT WARRANTIES (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
PRODUCT WARRANTIES (Details) - USD ($) $ in Thousands	Apr. 03, 2021	Dec. 31, 2020	Apr. 03, 2021	Dec. 31, 2020
Movement in Standard Product Warranty Accrual [Roll Forward]
Balance at the beginning of the period	$ 2,882	$ 2,846
Accruals for warranties issued	1,706	3,966
Warranty liabilities assume in GLI Acquisition		118
Less: Settlements made (in cash or in kind)	(1,077)	(4,048)
Balance at the end of the period	$ 2,882	$ 2,846	$ 3,511	$ 2,882
Less: Current portion of accrued warranty costs			(3,313)	(2,705)
Accrued warranty costs - less current portion			$ 198	$ 177

NET SALES (Details) - USD ($) $ in Thousands	3 Months Ended
NET SALES (Details) - USD ($) $ in Thousands	Apr. 03, 2021	Mar. 28, 2020
Disaggregation of Revenue [Line Items]
Net sales	$ 148,746	$ 51,134
In-ground Swimming Pools
Disaggregation of Revenue [Line Items]
Net sales	93,643	29,458
Covers
Disaggregation of Revenue [Line Items]
Net sales	24,006	11,011
Liners
Disaggregation of Revenue [Line Items]
Net sales	$ 31,097	$ 10,665

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 30
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8906-108599

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 40
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9031-108599

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 41
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9038-108599

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 4
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130543-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8736-108599

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8736-108599

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 42
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9054-108599

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130545-203045

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 924
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SAB Topic 11.L)
-URI http://asc.fasb.org/extlink&oid=6472922&loc=d3e499488-122856

+ Details

INCOME TAXES (Details)	3 Months Ended
INCOME TAXES (Details)	Apr. 03, 2021	Mar. 28, 2020
INCOME TAXES
Effective income tax rate	25.26%	16.34%

PROFITS INTEREST UNITS (Details) - USD ($) $ in Millions		3 Months Ended
PROFITS INTEREST UNITS (Details) - USD ($) $ in Millions	Jan. 29, 2021	Apr. 03, 2021	Mar. 28, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Effective income tax rate		25.26%	16.34%
Terminated Employee
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Cumulative catch-up charge from modification		$ 1.1
Performance-vesting Units \| Terminated Employee
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Units forfeited	1,055,057
Time-vesting units \| Terminated Employee
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vested and nonvested units held at time of termination	527,528
Vested units at time of termination, pre-modification	211,011
Accelerated vesting, number of units	105,506
Vested units at time of termination, after modification	316,517

NET INCOME (LOSS) PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Apr. 03, 2021	Mar. 28, 2020
Numerator:
Net income (loss) attributable to common stockholders	$ 8,533	$ (15,451)
Denominator:
Weighted-average common shares outstanding, basic and diluted	109,673,709	109,673,709
Net income (loss) per share attributable to common stockholders, basic and diluted	$ 0.08	$ (0.14)
No potentially dilutive securities outstanding	0	0

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

+ Details

RELATED PARTY TRANSACTIONS - Bright AI Services (Details) - USD ($) $ in Thousands	3 Months Ended		12 Months Ended
	Apr. 03, 2021	Mar. 28, 2020	Dec. 31, 2020
Bright AI Services \| Development Of Internal Use Software
Related Party Transaction [Line Items]
Costs incurred	$ 500	$ 0	$ 500

RELATED PARTY TRANSACTIONS - Purchase of Treasury Stock (Details) - Parent - USD ($) $ in Millions	Dec. 28, 2021	Dec. 28, 2020	Oct. 20, 2020	Oct. 14, 2020
Related Party Transaction [Line Items]
Contribution from parent for issuance of common stock			$ 64.9	$ 64.9
Shares issued to parent			32,902,113	32,902,113
Purchases and retirement of treasury stock (in shares)		32,902,113
Purchases and retirement of treasury stock	$ 64.9

RELATED PARTY TRANSACTIONS - Expense Reimbursement and Management Fees (Details) - Sponsor - Management Fee Arrangement - USD ($) $ in Thousands	3 Months Ended
	Apr. 03, 2021	Mar. 28, 2020
Related Party Transaction [Line Items]
Maximum annual reimbursement	$ 1,000
Management fees incurred	0	$ 0
Amounts payable	$ 0	$ 0

RELATED PARTY TRANSACTIONS - Operating Lease (Details) - Acquigen Pty Ltd. - Lease Agreement - USD ($) $ in Millions	3 Months Ended
	Apr. 03, 2021	Mar. 28, 2020	Dec. 31, 2020
Related Party Transaction [Line Items]
Future minimum lease payments	$ 3.7		$ 4.2
Rent expense	$ 0.1	$ 0.1

SEGMENT AND GEOGRAPHIC INFORMATION - Segment Information (Details)	3 Months Ended
	Apr. 03, 2021 segment
SEGMENT AND GEOGRAPHIC INFORMATION
Number of operating segments	1
Number of reportable segments	1

SEGMENT AND GEOGRAPHIC INFORMATION - Geographic Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 03, 2021	Mar. 28, 2020	Dec. 31, 2020
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	$ 148,746	$ 51,134
Property and equipment, net	50,605		$ 47,357
United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	119,070	39,006
Property and equipment, net	41,458		37,680
Canada
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	21,115	5,942
Property and equipment, net	2,899		3,050
Australia
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	5,750	4,117
Property and equipment, net	4,582		4,979
New Zealand
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	1,756	647
Property and equipment, net	1,666		$ 1,648
Other
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	$ 1,055	$ 1,422

- Definition

+ References

+ Details

SUBSEQUENT EVENTS (Details) $ / shares in Units, $ in Thousands	May 24, 2021 USD ($) shares	Apr. 22, 2021 item $ / shares shares	Apr. 12, 2021 USD ($) shares	Apr. 13, 2021 $ / shares shares	Apr. 03, 2021 $ / shares shares	Dec. 31, 2020 $ / shares shares
Subsequent Event [Line Items]
Common stock, shares authorized					500,000,000	500,000,000
Common stock, par value \| $ / shares					$ 0.0001	$ 0.0001
Subsequent Event
Subsequent Event [Line Items]
Common stock, shares authorized		900,000,000
Common stock, par value \| $ / shares		$ 0.0001
Increase in authorised share capital		1,000,000,000
Preferred stock shares authorised		100,000,000
Preferred stock par value \| $ / shares		$ 0.0001
Subsequent Event \| IPO
Subsequent Event [Line Items]
Common stock, shares authorized				500,000,000
Common stock, par value \| $ / shares				$ 0.0001
Stock split ratio			109,673.709
Subsequent Event \| Restricted stock awards
Subsequent Event [Line Items]
Accelerated vesting, number of restricted stock	84,687
Share based compensation expense \| $	$ 1,600
Subsequent Event \| Restricted stock awards \| Share-based Payment Arrangement, Tranche One
Subsequent Event [Line Items]
Restricted stock/units expected to vest		6,799,414
Vesting period in equal installments		6 months
Subsequent Event \| Restricted stock awards \| Share-based Payment Arrangement, Tranche Two
Subsequent Event [Line Items]
Restricted stock/units expected to vest		1,540,712
Vesting period in equal installments		6 months
Subsequent Event \| Restricted stock units \| Share-based Payment Arrangement, Tranche One
Subsequent Event [Line Items]
Restricted stock/units expected to vest		251,828
Subsequent Event \| Restricted stock units \| Share Based Compensation Award Tranche One, Nine Month Anniversary
Subsequent Event [Line Items]
Percentage of stock awards vesting each anniversary of the closing of the IPO		33.33%
Subsequent Event \| Restricted stock units \| Share Based Compensation Award Tranche One, First Anniversary
Subsequent Event [Line Items]
Percentage of stock awards vesting each anniversary of the closing of the IPO		33.33%
Subsequent Event \| Restricted stock units \| Share Based Compensation Award Tranche One, Two Year Anniversary
Subsequent Event [Line Items]
Percentage of stock awards vesting each anniversary of the closing of the IPO		33.33%
Subsequent Event \| Restricted stock units \| Share-based Payment Arrangement, Tranche Two
Subsequent Event [Line Items]
Restricted stock/units expected to vest		22,367
Number of anniversaries of closing of the IPO on which share-based compensation awards vest \| item		1
Subsequent Event \| Restricted stock units \| Share-based Payment Arrangement, Tranche Three
Subsequent Event [Line Items]
Restricted stock/units expected to vest		51,316
Vesting period		9 months
Subsequent Event \| Restricted stock units \| Share-based Payment Arrangement, Tranche Four
Subsequent Event [Line Items]
Restricted stock/units expected to vest		15,790
Number of anniversaries of closing of the IPO on which share-based compensation awards vest \| item		3
Subsequent Event \| Stock options
Subsequent Event [Line Items]
Number of options expected to vest		886,862
Percentage of stock awards vesting each year		25.00%
Number of anniversaries of closing of the IPO on which share-based compensation awards vest \| item		4
Strike price \| $ / shares		$ 19.00
Subsequent Event \| 2021 Omnibus Incentive Plan \| Non-employee director
Subsequent Event [Line Items]
Maximum grant date fair value annual limit \| $			$ 750
Subsequent Event \| 2021 Omnibus Incentive Plan \| Share-based Payment Arrangement, Employee
Subsequent Event [Line Items]
Shares reserved for issuance			13,170,212
Subsequent Event \| 2021 Omnibus Incentive Plan \| Share-based Payment Arrangement, Employee \| Restricted stock awards
Subsequent Event [Line Items]
Restricted stock/units granted		8,340,126
Subsequent Event \| 2021 Omnibus Incentive Plan \| Share-based Payment Arrangement, Employee \| Restricted stock units
Subsequent Event [Line Items]
Restricted stock/units granted		341,301
Subsequent Event \| 2021 Omnibus Incentive Plan \| Share-based Payment Arrangement, Employee \| Stock options
Subsequent Event [Line Items]
Options granted		886,862