FAIR VALUE MEASUREMENTS |
9 Months Ended |
|---|---|
Jun. 30, 2026 | |
| Fair Value Disclosures [Abstract] | |
| FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS The carrying values of cash and equivalents, accounts receivable, accounts and notes payable, and revolving credit and variable interest rate debt approximate fair value due to either the short-term nature of such instruments or the fact that the interest rate of the revolving credit and variable rate debt is based upon current market rates. Applicable accounting guidance establishes a fair value hierarchy requiring the Company to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the hierarchy is based on the lowest level of input that is significant to the fair value measurement. The accounting guidance establishes three levels of inputs that may be used to measure fair value, as follows: •Level 1 inputs are measured and recorded at fair value based upon quoted prices in active markets for identical assets. •Level 2 inputs include inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in active markets for similar assets and liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of assets or liabilities. •Level 3 inputs are unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. On June 30, 2026, the fair values of Griffon’s Senior Notes and Term Loan B facility approximated $972,338 and $285,000, respectively. Fair values were based upon quoted market prices (Level 1 inputs). In connection with the sale of Griffon’s AMES North America business and the Company's equity method investment in Veritage, Griffon provided seller financing consisting of two second-lien PIK debt receivables (hereinafter referred to as second-lien PIK debt receivable) with an aggregate principal amount of $161,100 at a fixed annual rate of 10% PIK interest, which capitalizes quarterly. The second lien debt matures on December 9, 2029. The outstanding balance of the PIK note receivable was $162,039 as of June 30, 2026. Griffon recognized interest income of $939 during the three and nine months ended June 30, 2026. As of June 30, 2026, the fair value was determined using the market based approach (Level 3 inputs). Items Measured at Fair Value on a Recurring Basis Insurance contracts with values of $5,449 at June 30, 2026 are measured and recorded at fair value based upon quoted prices in active markets for similar assets (Level 2 inputs) and are included in Other assets on the Condensed Consolidated Balance Sheets. In the normal course of business, Griffon’s operations are exposed to the effects of changes in foreign currency exchange rates related to inventory purchases. To manage these risks, Griffon may enter into various derivative contracts such as foreign currency exchange contracts, including forwards and options. As of June 30, 2026, Griffon entered into several such contracts in order to lock into a foreign currency rate for planned settlements of trade liabilities payable in U.S. Dollars. At June 30, 2026, Griffon had $50,913 of Chinese Yuan contracts at a weighted average rate of $6.79 which qualified for hedge accounting (Level 2 inputs). These hedges were all deemed effective as cash flow hedges with gains and losses related to changes in fair value deferred and recorded in Accumulated Other Comprehensive Income ("AOCI") and Prepaid and other current assets, or Accrued liabilities, until settlement. Upon settlement, gains and losses are recognized in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) in Cost of goods and services ("COGS"). AOCI included deferred gains of $18 ($13, net of tax) at June 30, 2026. Upon settlement, gains of $159 and $481 were recorded in COGS during the three and nine months ended June 30, 2026. All contracts expire in 31 to 92 days. In connection with the AMES Australasia transaction, Griffon entered into a foreign currency forward contract to mitigate the risk of depreciation in the Australian Dollar denominated proceeds. At June 30, 2026, Griffon had a $290,000 Australian Dollar forward contract at a rate of $0.70 which qualified for hedge accounting (Level 2 inputs). This hedge was deemed an effective cash flow hedge with $2,795 ($2,124, net of tax) deferred into AOCI at June 30, 2026. On July 31, 2026 Griffon completed the previously announced formation of a joint venture for it's AMES Australasia business. In connection with the completion, Griffon settled the aforementioned forward contract, and gains of $2,795 will be recognized in the Condensed Consolidated Statements of Operations during Griffon's fiscal 2026 fourth quarter.
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