gic-20240630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q


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

For the quarterly period ended June 30, 2024


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

For the transition period from to

COMMISSION FILE NUMBER 1-13792

Global Industrial Company

(Exact name of registrant as specified in its charter)


Delaware						11-3262067
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

11 Harbor Park Drive

Port Washington, New York 11050

(Address of principal executive offices, including zip code)

Registrant’s telephone number, including area code: (516) 608-7000

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock ($.01 par value)	GIC	New York Stock Exchange

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

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

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


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

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

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

The number of shares outstanding of the registrant’s common stock as of July 26, 2024 was 38,200,397.

TABLE OF CONTENTS


Available Information

Part I	Financial Information
Item 1.	Financial Statements	4
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	31
Item 4.	Controls and Procedures	32

Part II	Other Information
Item 1.	Legal Proceedings	34
Item 1A.	Risk Factors	34
Item 5.	Other Information	34
Item 6.	Exhibits	35
	Signatures	36

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Available Information

We maintain an internet website at https://investors.globalindustrial.com. We file reports with the Securities and Exchange Commission (“SEC”) and make available free of charge on or through this website our annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, including all amendments to those reports. These are available as soon as is reasonably practicable after they are filed with the SEC. All reports mentioned above are also available on the SEC’s website (www.sec.gov). Unless otherwise specified, the information on our website is not part of this or any other report we file with, or furnish to, the SEC.

Our Board of Directors has adopted the following corporate governance documents with respect to the Company (the “Corporate Governance Documents”), among others:

•Corporate Ethics Policy for officers, directors and employees

•Charter for the Audit Committee of the Board of Directors

•Charter for the Compensation Committee of the Board of Directors

•Charter for the Nominating/Corporate Governance Committee of the Board of Directors

•Corporate Governance Guidelines and Principles

•Conflict Minerals Disclosure

In accordance with the corporate governance rules of the New York Stock Exchange, each of the Corporate Governance Documents is available on our Company website, https://investors.globalindustrial.com.

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PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

Global Industrial Company

Condensed Consolidated Balance Sheets

(In millions)


	June 30, 2024		December 31, 2023
	(Unaudited)
ASSETS:
Current assets:
Cash and cash equivalents	$	38.8	$	34.4
Accounts receivable, net	142.8		130.7
Inventories	172.9		150.8
Prepaid expenses and other current assets	12.4		13.9

Total current assets	366.9		329.8

Property, plant and equipment, net	19.9		20.0
Operating lease right-of-use assets	77.4		84.4
Deferred income taxes	8.1		7.9
Goodwill and intangible assets	67.3		69.3
Other assets	2.9		2.0

Total assets	$	542.5	$	513.4

LIABILITIES AND SHAREHOLDERS’ EQUITY:
Current liabilities:
Accounts payable	$	126.0	$	111.0

Accrued expenses and other current liabilities	55.6		49.1

Operating lease liabilities	14.2		14.1
Total current liabilities	195.8		174.2

Operating lease liabilities	73.9		81.4
Other liabilities	2.4		2.6
Total liabilities	272.1		258.2

Commitments and contingencies

Shareholders’ equity:
Preferred stock	0.0		0.0
Common stock	0.4		0.4
Additional paid-in capital	204.6		204.8
Treasury stock	(17.1)		(18.6)
Retained earnings	80.3		66.0
Accumulated other comprehensive income	2.2		2.6
Total shareholders’ equity	270.4		255.2
Total liabilities and shareholders’ equity	$	542.5	$	513.4

See Notes to Condensed Consolidated Financial Statements.

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Global Industrial Company

Condensed Consolidated Statements of Operations (Unaudited)

(In millions, except per share amounts)


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Net sales	$	347.8	$	325.8	$	671.2	$	599.6
Cost of sales	225.3		212.9		437.8		388.3
Gross profit	122.5		112.9		233.4		211.3
Selling, distribution & administrative expenses	96.1		83.8		189.6		164.4

Operating income from continuing operations	26.4		29.1		43.8		46.9
Interest and other expense, net	0.1		0.3		0.3		0.5

Income from continuing operations before income taxes	26.3		28.8		43.5		46.4
Provision for income taxes	6.1		7.3		10.2		11.6
Net income from continuing operations	20.2		21.5		33.3		34.8
Net income (loss) from discontinued operations, net of tax	0.1		0.0		0.2		(0.1)
Net income	$	20.3	$	21.5	$	33.5	$	34.7

Net income per common share from continuing operations:
Basic	$	0.52	$	0.56	$	0.87	$	0.91
Diluted	$	0.52	$	0.56	$	0.86	$	0.91
Net income (loss) per common share from discontinued operations:
Basic	$	0.00	$	0.00	$	0.01	$	0.00
Diluted	$	0.00	$	0.00	$	0.01	$	0.00
Net income per common share:
Basic	$	0.52	$	0.56	$	0.88	$	0.91
Diluted	$	0.52	$	0.56	$	0.87	$	0.91

Weighted average common and common equivalent shares:
Basic	38.2		38.1		38.2		38.1
Diluted	38.4		38.2		38.4		38.2

Dividends declared	$	0.25	$	0.20	$	0.50	$	0.40

See Notes to Condensed Consolidated Financial Statements.

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Global Industrial Company

Condensed Consolidated Statements of Comprehensive Income (Unaudited)

(In millions)


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Net income	$	20.3	$	21.5	$	33.5	$	34.7
Other comprehensive income:
Foreign currency translation (loss) gain	(0.2)		0.2		(0.4)		0.3
Total comprehensive income	$	20.1	$	21.7	$	33.1	$	35.0

See Notes to Condensed Consolidated Financial Statements.

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Global Industrial Company

Condensed Consolidated Statements of Cash Flows (Unaudited)

(In millions)


	Six Months Ended June 30,
	2024		2023
Cash flows from operating activities:
Net income from continuing operations	$	33.3	$	34.8
Adjustments to reconcile net income from continuing operations to net cash provided by (used in) operating activities:
Depreciation and amortization	3.8		2.6

Provision for credit losses	1.9		1.4
Stock-based compensation	0.6		1.2
(Benefit) provision for deferred taxes	(0.1)		0.1

Changes in operating assets and liabilities:
Accounts receivable	(14.2)		(16.9)
Inventories	(22.4)		25.6
Prepaid expenses and other assets	(1.9)		0.4
Income taxes payable	2.8		3.6
Accounts payable	15.2		8.9
Accrued expenses, other current liabilities and other liabilities	6.0		3.8
Net cash provided by operating activities from continuing operations	25.0		65.5
Net cash provided by (used in) operating activities from discontinued operations	0.2		(0.2)
Net cash provided by operating activities	25.2		65.3

Cash flows from investing activities:
Purchases of property, plant and equipment	(2.2)		(1.4)

Purchase of Indoff LLC, net of cash acquired	0.0		(72.3)
Net cash used in investing activities	(2.2)		(73.7)



Cash flows from financing activities:
Proceeds from short-term borrowings	0.0		50.6
Repayment of short-term borrowings	0.0		(10.9)
Dividends paid	(19.2)		(15.3)
Proceeds from issuance of common stock	1.4		0.3
Payment of payroll taxes on stock-based compensation through shares withheld	(1.5)		(0.5)
Proceeds from the issuance of common stock from employee stock purchase plan	0.8		0.7


Net cash (used in) provided by financing activities	(18.5)		24.9

Effects of exchange rates on cash	(0.1)		(0.1)

Net increase in cash	4.4		16.4
Cash and cash equivalents – beginning of period	34.4		28.5
Cash and cash equivalents – end of period	$	38.8	$	44.9

Supplemental disclosures of non-cash investing and financing activities:
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	1.2	$	5.9

See Notes to Condensed Consolidated Financial Statements.

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Global Industrial Company

Condensed Consolidated Statement of Shareholders’ Equity (Unaudited)

(In millions, except share data in thousands)


	Common Stock
	Number of Shares Outstanding	Amount		Additional Paid-in Capital		Treasury Stock		Retained Earnings		Accumulated Other Comprehensive Income		Total Equity
Balances, January 1, 2024	38,074	$	0.4	$	204.8	$	(18.6)	$	66.0	$	2.6	$	255.2
Stock-based compensation expense				1.0								1.0
Issuance of restricted stock	66			(1.2)		1.2						0.0
Stock withheld for employee taxes	(37)			(0.8)		(0.7)						(1.5)
Proceeds from issuance of common stock	50			0.4		0.9						1.3
Issuance of shares under employee stock purchase plan	28			0.8								0.8
Dividends								(9.6)				(9.6)


Change in cumulative translation adjustment										(0.2)		(0.2)
Net income								13.2				13.2
Balances, March 31, 2024	38,181	$	0.4	$	205.0	$	(17.2)	$	69.6	$	2.4	$	260.2
Stock-based compensation expense				(0.4)								(0.4)
Issuance of restricted stock	4			(0.1)		0.1						0.0

Proceeds from issuance of common stock	2			0.1		0.0						0.1

Dividends								(9.6)				(9.6)

Change in cumulative translation adjustment										(0.2)		(0.2)
Net income								20.3				20.3
Balances, June 30, 2024	38,187	$	0.4	$	204.6	$	(17.1)	$	80.3	$	2.2	$	270.4

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	Common Stock
	Number of Shares Outstanding	Amount		Additional Paid-in Capital		Treasury Stock		Retained Earnings		Accumulated Other Comprehensive Income		Total Equity
Balances, January 1, 2023	37,961	$	0.4	$	201.2	$	(19.5)	$	25.9	$	2.4	$	210.4
Stock-based compensation expense				0.6								0.6
Issuance of restricted stock	36			(0.6)		0.6						0.0
Stock withheld for employee taxes	(14)			(0.1)		(0.3)						(0.4)
Proceeds from issuance of common stock	3			0.0		0.1						0.1
Issuance of shares under employee stock purchase plan	31			0.7								0.7
Dividends								(7.7)				(7.7)

Change in cumulative translation adjustment										0.1		0.1
Net income								13.2				13.2

Balances, March 31, 2023	38,017	$	0.4	$	201.8	$	(19.1)	$	31.4	$	2.5	$	217.0
Stock-based compensation expense				0.6								0.6
Issuance of restricted stock	8			(0.1)		0.1						0.0
Stock withheld for employee taxes	(2)			(0.1)		0.0						(0.1)
Proceeds from issuance of common stock	8			0.1		0.1						0.2

Dividends								(7.6)				(7.6)

Change in cumulative translation adjustment										0.2		0.2
Net income								21.5				21.5
Balances, June 30, 2023	38,031	$	0.4	$	202.3	$	(18.9)	$	45.3	$	2.7	$	231.8

See Notes to Condensed Consolidated Financial Statements.

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Global Industrial Company

Notes to Condensed Consolidated Financial Statements (Unaudited)

1.Basis of Presentation

The accompanying condensed consolidated financial statements of Global Industrial Company, (the "Company" or "Global Industrial"), with its subsidiaries are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America are not required in these interim financial statements and have been condensed or omitted. All significant intercompany accounts and transactions have been eliminated in consolidation.

Global Industrial Company, through its operating subsidiaries, is a value-added distributor currently offering hundreds of thousands of industrial and maintenance, repair and operation ("MRO") products in North America going to market through a system of branded e-commerce websites and relationship marketers. The Company operates and is internally managed in one reportable business segment. The Company sells a wide array of industrial and MRO products, markets the Company has served since 1949. Because of the large number of products and product categories the Company offers, providing information on the amount of revenue derived from transactions with external customers for each product or groupings of product is impractical.

As previously disclosed, the Company acquired 100% of the outstanding equity interests of Indoff LLC ("Indoff''), a business-to-business direct marketer of material handling products, commercial interior products and business products with operations in North America, on May 19, 2023 for approximately $72.6 million in cash. The Indoff accounts are included in the accompanying condensed consolidated financial statements from the date of acquisition (see Note 2).

In the opinion of management, the accompanying condensed consolidated financial statements contain all normal and recurring adjustments necessary to present fairly the financial position of the Company as of June 30, 2024 and the results of operations for the three and six month periods ended June 30, 2024 and 2023, statements of comprehensive income for the three and six month periods ended June 30, 2024 and 2023, cash flows for the six month periods ended June 30, 2024 and 2023 and changes in shareholders’ equity for the three and six month periods ended June 30, 2024 and 2023. The December 31, 2023 Condensed Consolidated Balance Sheet has been derived from the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

These condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements as of December 31, 2023 and for the year then ended included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023. The results for the six month period ended June 30, 2024 are not necessarily indicative of the results for the entire year.

Global Industrial Company manages its business and reports using a 52-53 week fiscal year that ends at midnight on the Saturday closest to December 31. For clarity of presentation herein, fiscal years and quarters are referred to as if they ended on the traditional calendar month. The actual fiscal second quarters ended on June 29, 2024 and July 1, 2023, respectively. The second quarters of both 2024 and 2023 included 13 weeks and the first six months of both 2024 and 2023 included 26 weeks.

Recent Accounting Pronouncements

Public companies in the United States are subject to the accounting and reporting requirements of various authorities, including the Financial Accounting Standards Board (“FASB”) and the Securities and Exchange Commission (“SEC”). These authorities issue numerous pronouncements, most of which are not applicable to the Company’s current or reasonably foreseeable operating structure.

In December 2023, the FASB issued Accounting Standard Update ("ASU") 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. This ASU requires public business entities to disclose consistent categories and greater disaggregation of information in the rate reconciliation and income taxes paid disaggregated by jurisdiction. This ASU is effective for annual periods beginning after December 15, 2024. Early adoption is permitted. This ASU should be applied on a prospective basis, but retrospective application is permitted. The Company does not expect the adoption of this standard to have a material impact on the Company's financial position or results of operations.

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2.Acquisition

The Company acquired 100% of the outstanding equity interests of Indoff, a business-to-business direct marketer of material handling products, commercial interiors and business products with operations in North America, on May 19, 2023 for approximately $72.6 million in cash, $5.2 million of which was placed into an escrow account for two years to secure the sellers’ indemnification obligations under the purchase agreement. In accordance with the terms of the escrow agreement, the escrow amount was reduced to $2.5 million on the one year anniversary of the closing date. This acquisition expanded the Company's presence in the industrial products market in North America. The acquisition was accounted for as a business combination using the acquisition method of accounting, which requires, among other things, the assets acquired and the liabilities assumed be recognized at their fair values as of the acquisition date. The fair value assigned to the identified intangible assets acquired were based on assumptions and estimates made by management. The Company acquired in the transaction customer lists and trademark assets that are amortizing over a ten-year period which results in approximately $3.0 million in annual amortization expense. The acquisition was an asset acquisition for tax purposes and as such, the customer lists, trademarks and goodwill resulting from this acquisition will be tax deductible over a fifteen-year period. The Indoff accounts are included in the accompanying condensed consolidated financial statements from the date of acquisition.

The Company prepared a purchase price fair value allocation of the assets acquired and liabilities assumed in the acquisition. The fair value allocation has been finalized. The following table details the fair values as of the acquisition date (in millions):


Purchase price:	$	72.6
Less:
Cash	0.3
Accounts receivable	23.0
Inventories	4.6
Prepaid expenses and other current assets	2.5
Property, plant and equipment	0.3
Operating lease right-of-use assets	0.8
Customer lists	24.1
Trademarks	6.2
Other assets	0.1
Total identifiable assets acquired	$	61.9
Accounts payable	(12.5)
Accrued expenses and other current liabilities	(5.9)
Deferred revenue	(4.2)
Operating lease liabilities	(0.8)
Total identifiable liabilities acquired	$	(23.4)
Net identifiable assets acquired	38.5
Goodwill	$	34.1
Total net assets acquired	$	72.6

The amount allocated to goodwill reflects the benefits the Company expects to realize from the growth of the acquisition's operations.

For the three and six months ended June 30, 2024, Indoff generated revenue of approximately $40.4 million and $78.5 million, respectively, and net income of approximately $1.1 million and $2.1 million, respectively.

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The Company’s unaudited pro forma revenue and net income for the quarter and six months ended June 30, 2023 below have been prepared as if the Indoff acquisition had occurred on January 1, 2023. This information is provided for illustrative purposes and does not purport to be indicative of the actual results that would have been achieved by the Company for the period presented (in millions):


	Three Months Ended June 30,		Six Months Ended June 30,
	2023		2023
Net sales	$	346.1	$	662.1
Net income from continuing operations	$	21.7	$	36.4

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3.Goodwill and Intangibles

The following table provides information related to the goodwill and intangible assets as of June 30, 2024 and December 31, 2023 (in millions):


	June 30,		December 31,
	2024		2023
Goodwill	$	39.6	$	40.0
Definite-lived intangibles	27.0		28.6
Indefinite-lived intangibles	0.7		0.7
Balance	$	67.3	$	69.3

The following table summarizes information related to the Company's definite-lived intangible assets as of June 30, 2024 (in millions):


	Amortization Period (Years)	Gross Carrying Amount		Accumulated Amortization		Net Book Value		Weighted Average Useful Life
Client lists	10 yrs	$	26.1	$	4.6	$	21.5	8.8
Trademarks	10 yrs	6.2		0.7		5.5		8.9
Total		$	32.3	$	5.3	$	27.0	8.8

The following table summarizes information related to the Company's definite-lived intangible assets as of December 31, 2023 (in millions):


	Amortization Period (Years)	Gross Carrying Amount		Accumulated Amortization		Net Book Value		Weighted Average Useful Life
Client lists	10 yrs	$	26.1	$	3.3	$	22.8	9.3
Trademarks	10 yrs	6.2		0.4		5.8		9.4
Total		$	32.3	$	3.7	$	28.6	9.3

In the second quarter of 2024, the Company recorded $0.8 million of intangible amortization expense related to the prior year's Indoff acquisition. For the six months ended June 30, 2024, the Company recorded $1.6 million of intangible amortization expense, of which $1.5 million related to the prior year's acquisition of Indoff. The estimated amortization for future years ending December 31 is as follows (in millions):


2024 remainder	$	1.6
2025	3.0
2026	3.0
2027	3.0
2028	3.0
Thereafter	$	13.4
Total	$	27.0

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4.Revenue

Disaggregation of Revenues

The Company believes its presentation of revenue by geography most reasonably depicts how the nature, amount, timing and uncertainty of the Company's revenue and cash flows are affected by economic and industry factors, including fluctuations in exchange rates between the U.S. and Canada. The following table presents the Company's revenue from continuing operations by geography for the three and six months ended June 30, 2024 and 2023, respectively (in millions):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Net sales:
United States	$	330.7	$	308.1	$	637.1	$	565.3
Canada	17.1		17.7		34.1		34.3
Consolidated	$	347.8	$	325.8	$	671.2	$	599.6

The Company will record a contract liability in cases where customers pay in advance of the Company's satisfaction of its performance obligation. The Company had approximately $4.5 million and $3.3 million of contract liabilities as of June 30, 2024 and December 31, 2023, respectively.

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5.Credit Losses

The Company’s trade accounts receivable is one portfolio comprised of commercial businesses as well as public sector organizations operating in the U.S. and, to a lesser extent, Canada. The Company develops its allowances for credit losses, which represent an estimate of expected losses over the remaining contractual life of its receivables, considering customer financial condition, historical loss experience with its customers, current market economic conditions and forecasts of future economic conditions when appropriate. When the Company becomes aware of a customer's inability to meet its financial obligation, a specific reserve is recorded to reduce the receivable to the expected amount to be collected. For the balance of its trade receivables, the Company uses a loss rate method to estimate its credit loss reserve. Historical loss experience rates are calculated using receivable write-offs over a trailing twelve-month period and comparing that to the average receivable balances over the same period. That rate is applied to the current accounts receivable portfolio, excluding accounts that have been specifically reserved. Any write-offs incurred are recorded against the established reserves.

The Company grants credit to commercial business customers using an electronic application process that evaluates the customer's detailed credit report, reference responses, availability under credit facilities, existing liens, tenure of management and business history, among other factors. Credit terms are typically net 30 days payment required with larger businesses eligible for up to net 90 day terms, if qualified.

The following is a rollforward of the allowances for credit losses related to trade accounts receivable for the six months ended June 30, 2024 (in millions):


	June 30, 2024
Balance at beginning of period	$	2.9

Current period provision	1.9
Write-offs - trade accounts receivable	(1.2)
Balance at end of period	$	3.6

The following is a rollforward of the allowances for credit losses related to trade accounts receivable for the year ended December 31, 2023 (in millions):


	December 31, 2023
Balance at beginning of period	$	2.3
Current period provision	3.2
Write-offs - trade accounts receivable	(2.6)
Balance at end of period	$	2.9

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6.Leases

The Company has operating and finance leases for office and warehouse facilities, headquarters, call centers, machinery and certain computer and communications equipment which provide the right to use the underlying assets in exchange for agreed upon lease payments, determined by the payment schedule contained in each lease. The Company’s lease portfolio consists primarily of operating leases which expire at various dates through 2032. In the first quarter of 2024, the Company recorded an operating right-of-use ("ROU") asset and related lease liability of $0.7 million related to a three year term extension of an existing administrative office location consisting of approximately 16,200 square feet. In the second quarter of 2024, the Company recorded an ROU asset and related lease liability of approximately of $0.5 million related to a thirty-seven month term lease of an existing sales office location consisting of approximately 6,600 square feet.

The Company's operating lease costs, included in continuing operations, was $4.4 million and $4.2 million for the three months ended June 30, 2024 and 2023, respectively, and $8.7 million and $8.4 million for June 30, 2024 and 2023, respectively. The Company has sublease agreements for unused facilities, as well as excess space in facilities we are currently occupying, which expire at various dates through 2028. Total sublease income of $0.6 million and $1.2 million was recorded for the three and six months ended June 30, 2024 and 2023, respectively.

Information relating to operating and finance leases for continuing and discontinued operations as of June 30, 2024 and December 31, 2023:


	Six Months Ended June 30,			Year Ended December 31,
	2024			2023
Weighted Average Remaining Lease Term
Operating and finance leases	7.0 years			7.2 years

Weighted Average Discount Rate
Operating and finance leases	5.5		%	5.4		%

ROU assets obtained in exchange for operating and finance lease obligations (in millions)	$	1.2		$	6.3

Maturities of lease liabilities were as follows (in millions):


Year Ending December 31	Operating Leases
2024 (adjusted for six months of payments)	$	9.4
2025	17.9
2026	15.9
2027	12.0
2028	11.9
2029	12.1
Thereafter	28.4
Total lease payments	107.6
Less: interest	(19.5)
Total present value of lease liabilities	$	88.1

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7.Net Income (Loss) per Common Share

Net income (loss) per common share - basic was calculated based upon the weighted average number of common shares outstanding during the respective periods presented using the two-class method of computing earnings per share. The two-class method was used as the Company has outstanding restricted stock with rights to dividend participation for unvested shares. Undistributed net income is allocated between common shares outstanding and participating securities to the extent that each security may share in earnings as if all of the earnings for the period had been distributed. Undistributed net losses are not allocated to our participating securities as these participating securities do not have a contractual obligation to share in losses. Net income (loss) per common share - diluted was calculated based upon the weighted average number of common shares outstanding and included the equivalent shares for dilutive options outstanding during the respective periods, including unvested options. The dilutive effect of outstanding options and restricted stock issued by the Company is reflected in net income per share - diluted using the treasury stock method. Under the treasury stock method, options will only have a dilutive effect when the average market price of common stock during the period exceeds the exercise price of the options.

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The following table presents the computation of basic and diluted net income (loss) per share under the two-class method for the three and six months ended June 30, 2024 and 2023 (in millions, except for per share amounts):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Net income from continuing operations	$	20.2	$	21.5	33.3		34.8
Less: Distributed net income available to participating securities	(0.1)		0.0		(0.1)		(0.1)
Less: Undistributed net income available to participating securities	0.0		(0.1)		(0.1)		(0.1)
Numerator for basic net income per share:
Undistributed and distributed net income available to common shareholders	$	20.1	$	21.4	$	33.1	$	34.6
Add: Undistributed net income allocated to participating securities	0.0		0.1		0.1		0.1
Less: Undistributed net income reallocated to participating securities	0.0		(0.1)		(0.1)		(0.1)

Numerator for diluted net income per share:
Undistributed and distributed net income available to common shareholders	$	20.1	$	21.4	33.1		34.6
Denominator:
Weighted average shares outstanding for basic net income per share	38.2		38.1		38.2		38.1
Effect of dilutive securities	0.2		0.1		0.2		0.1
Weighted average shares outstanding for diluted net income per share	38.4		38.2		38.4		38.2
Net income per share from continuing operations:
Basic	$	0.52	$	0.56	$	0.87	$	0.91
Diluted	$	0.52	$	0.56	$	0.86	$	0.91

Net income (loss) from discontinued operations	$	0.1	$	0.0	$	0.2	$	(0.1)

Numerator for basic and diluted net income (loss) per share:
Undistributed and distributed net (loss) income available to common shareholders	$	0.1	$	0.0	$	0.2	$	(0.1)





Net income (loss) income per share from discontinued operations:
Basic	$	0.00	$	0.00	$	0.01	$	0.00
Diluted	$	0.00	$	0.00	$	0.01	$	0.00

Net income per share:
Basic	$	0.52	$	0.56	$	0.88	$	0.91
Diluted	$	0.52	$	0.56	$	0.87	$	0.91

Potentially dilutive securities	0.2		0.3		0.2		0.3

Potentially dilutive securities attributable to outstanding stock options, restricted stock units, and performance share units are excluded from the calculation of diluted earnings per share when the combined exercise price and average unamortized fair value are greater than the average market price of Global Industrial Company's common stock during the period, and their inclusion would be anti-dilutive.

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8.Credit Facilities

The Company maintains a $125.0 million secured revolving credit facility with one financial institution. This facility has a five-year term, maturing on October 19, 2026 and provides for borrowings in the United States. The credit agreement contains certain operating, financial and other covenants, including limits on annual levels of capital expenditures, availability tests related to payments of dividends and stock repurchases and fixed charge coverage tests related to acquisitions. The revolving credit agreement requires that a minimum level of availability be maintained. If such availability is not maintained, the Company will be required to maintain a fixed charge coverage ratio (as defined). The borrowings under the agreement are subject to borrowing base limitations of up to 85% of eligible accounts receivable and the inventory advance rate computed as the lesser of 65% or 85% of the net orderly liquidation value (“NOLV”). Borrowings are secured by substantially all of the Borrower’s assets, as defined, including all accounts, accounts receivable, inventory and certain other assets, subject to limited exceptions, including the exclusion of certain foreign assets from the collateral. The interest rate under the amended and restated facility is computed at applicable market rates based on the Secured Overnight Financing Rate (“SOFR”), the Federal Reserve Bank of New York (“NYFRB”) or the Prime Rate, plus an applicable margin. The applicable margin varies based on borrowing base availability. As of June 30, 2024, eligible collateral under the credit agreement was $125.0 million, total availability was $122.2 million, total outstanding letters of credit was $1.6 million, and total excess availability was $120.6 million. The Company was in compliance with all of the covenants of the credit agreement as of June 30, 2024.

9.Fair Value Measurements

Fair value accounting standards define fair value 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. The fair value standards establish the fair value hierarchy to prioritize the inputs used in valuation techniques. There are three levels to the fair value hierarchy (Level 1 is the highest priority and Level 3 is the lowest priority):


Level 1 -			Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.
Level 2 -			Inputs other than quoted prices included in Level 1 that are observable for the asset or liability either directly or indirectly.
Level 3 -			Unobservable inputs which are supported by little or no market activity.

Financial instruments consist primarily of investments in cash, trade accounts receivable, debt and accounts payable. The Company determines the fair value of financial instruments based on interest rates available to the Company. At June 30, 2024 and December 31, 2023, the carrying amounts of cash, accounts receivable and accounts payable are considered to be representative of their respective fair values due to their short-term nature. Cash is classified as Level 1 within the fair value hierarchy.

The fair value with respect to goodwill and indefinite-lived intangible assets are measured in connection with the Company’s annual impairment testing. The Company operates in three reporting units and in the fourth quarter of each year, or more frequently if impairment indicators exist, tests goodwill and indefinite-lived intangibles for impairment. The Company performs a qualitative assessment of current circumstances, such as a reporting unit's operating results, cash flows, future operating forecasts and anticipated future cash flows to determine the existence of impairment indicators and to assess if it is more likely than not that the fair value of the reporting unit or an indefinite lived intangible asset is less than its carrying value. If it is determined that the fair value of the reporting unit or an indefinite-lived intangible asset may be less than its carrying value, the C