0001193125-22-276863 | 10-Q | XBRL Viewer

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Cover Page - shares	9 Months Ended
Cover Page - shares	Sep. 30, 2022	Oct. 31, 2022
Document Information [Line Items]
Document Type	10-Q
Document Period End Date	Sep. 30, 2022
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q3
Current Fiscal Year End Date	--12-31
Amendment Flag	false
Entity Registrant Name	WATSCO, INC.
Entity Central Index Key	0000105016
Entity File Number	1-5581
Entity Incorporation, State or Country Code	FL
Document Quarterly Report	true
Document Transition Report	false
Entity Tax Identification Number	59-0778222
Entity Address, City or Town	Miami
Entity Address, Postal Zip Code	33133
Entity Address, Address Line One	2665 South Bayshore Drive
Entity Address, Address Line Two	Suite 901
Entity Address, State or Province	FL
City Area Code	305
Local Phone Number	714-4100
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Common Stock [Member]
Document Information [Line Items]
Trading Symbol	WSO
Security Exchange Name	NYSE
Title of 12(b) Security	Common stock, $0.50 par value
Entity Common Stock, Shares Outstanding		33,263,057
Common Class B [Member]
Document Information [Line Items]
Trading Symbol	WSOB
Security Exchange Name	NYSE
Title of 12(b) Security	Class B common stock, $0.50 par value
Entity Common Stock, Shares Outstanding		5,473,122

Condensed Consolidated Unaudited Statements of Income - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Revenues	$ 2,035,796	$ 1,782,569	$ 5,693,121	$ 4,768,327
Cost of sales	1,484,948	1,299,905	4,096,382	3,512,901
Gross profit	550,848	482,664	1,596,739	1,255,426
Selling, general and administrative expenses	321,522	281,922	919,629	766,231
Other income	6,927	6,057	17,289	16,267
Operating income	236,253	206,799	694,399	505,462
Interest expense, net	483	221	2,151	757
Income before income taxes	235,770	206,578	692,248	504,705
Income taxes	49,600	41,734	145,682	101,601
Net income	186,170	164,844	546,566	403,104
Less: net income attributable to non-controlling interest	28,529	23,979	83,070	63,045
Net income attributable to Watsco, Inc.	$ 157,641	$ 140,865	$ 463,496	$ 340,059
Earnings per share for Common and Class B common stock:
Basic	$ 4.04	$ 3.64	$ 11.9	$ 8.8
Diluted	$ 4.03	$ 3.62	$ 11.86	$ 8.75

Condensed Consolidated Unaudited Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Net income	$ 186,170	$ 164,844	$ 546,566	$ 403,104
Other comprehensive loss, net of tax
Foreign currency translation adjustment	(19,091)	(8,219)	(24,091)	(746)
Unrealized gain on cash flow hedging instruments	0	0	0	70
Reclassification of loss on cash flow hedging instruments into earnings	0	0	0	221
Other comprehensive loss	(19,091)	(8,219)	(24,091)	(455)
Comprehensive income	167,079	156,625	522,475	402,649
Less: comprehensive income attributable to non-controlling interest	22,040	21,114	74,911	62,821
Comprehensive income attributable to Watsco, Inc.	$ 145,039	$ 135,511	$ 447,564	$ 339,828

- Definition

Amount after tax of increase (decrease) in equity from transactions and other events and circumstances from net income (loss) and other comprehensive income (loss), attributable to noncontrolling interests. Excludes changes in equity resulting from investments by owners and distributions to owners.

+ References + Details

- Definition

Amount after tax of increase (decrease) in equity from transactions and other events and circumstances from net income and other comprehensive income. Excludes changes in equity resulting from investments by owners and distributions to owners.

+ References + Details

- Definition

Amount after tax and reclassification adjustments of other comprehensive income (loss).

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+ Details

Condensed Consolidated Unaudited Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Current assets:
Cash and cash equivalents	$ 130,228	$ 118,268
Accounts receivable, net	859,581	698,456
Inventories, net	1,385,191	1,115,469
Other current assets	34,876	29,207
Total current assets	2,409,876	1,961,400
Property and equipment, net	121,678	111,019
Operating lease right-of-use assets	312,397	268,528
Goodwill	430,231	434,019
Intangible assets, net	174,978	186,896
Investment in unconsolidated entity	127,420	114,808
Other assets	8,007	9,191
Total assets	3,584,587	3,085,861
Current liabilities:
Current portion of long-term obligations	89,238	84,501
Accounts payable	474,268	364,185
Accrued expenses and other current liabilities	376,016	278,036
Total current liabilities	939,522	726,722
Long-term obligations:
Borrowings under revolving credit agreement	8,800	89,000
Operating lease liabilities, net of current portion	227,564	187,024
Finance lease liabilities, net of current portion	10,764	9,189
Total long-term obligations	247,128	285,213
Deferred income taxes and other liabilities	81,784	76,511
Commitments and contingencies
Watsco, Inc. shareholders' equity:
Preferred stock, $0.50 par value	0	0
Paid-in capital	1,047,317	1,003,932
Accumulated other comprehensive loss, net of tax	(50,108)	(34,176)
Retained earnings	977,050	760,796
Treasury stock, at cost	(87,440)	(87,440)
Total Watsco, Inc. shareholders' equity	1,908,775	1,664,948
Non-controlling interest	407,378	332,467
Total shareholders' equity	2,316,153	1,997,415
Total liabilities and shareholders' equity	3,584,587	3,085,861
Common Stock
Watsco, Inc. shareholders' equity:
Common stock, $0.50 par value	19,039	18,941
Class B Common Stock
Watsco, Inc. shareholders' equity:
Common stock, $0.50 par value	$ 2,917	$ 2,895

Condensed Consolidated Unaudited Balance Sheets (Parenthetical) - $ / shares	Sep. 30, 2022	Dec. 31, 2021
Preferred stock, par value	$ 0.5	$ 0.5
Common Stock
Common stock, par value	0.5	0.5
Class B Common Stock
Common stock, par value	$ 0.5	$ 0.5

Condensed Consolidated Unaudited Statements of Shareholders' Equity - USD ($) $ in Thousands	Total	Common Stock, Class B Common Stock and Preferred Stock	Paid-In Capital	Accumulated Other Comprehensive Loss	Retained Earnings	Treasury Stock	Non-controlling Interest
Beginning balance at Dec. 31, 2020	$ 1,779,761	$ 21,697	$ 950,915	$ (34,867)	$ 636,373	$ (87,440)	$ 293,083
Beginning balance (in shares) at Dec. 31, 2020		38,521,694
Net income	66,127				55,092		11,035
Other comprehensive income (loss)	3,776			2,474			1,302
Issuances of non-vested restricted shares of common stock		$ 61	(61)
Issuances of non-vested restricted shares of common stock (in shares)		121,934
Forfeitures of non-vested restricted shares of common stock		$ (21)	21
Forfeitures of non-vested restricted shares of common stock (in shares)		(43,000)
Common stock contribution to 401(k) plan	5,154	$ 11	5,143
Common stock contribution to 401(k) plan (in shares)		22,752
Stock issuances from exercise of stock options and employee stock purchase plan	3,874	$ 12	3,862
Stock issuances from exercise of stock options and employee stock purchase plan (in shares)		24,735
Share-based compensation	6,656		6,656
Cash dividends declared and paid on Common and Class B common stock	(68,521)				(68,521)
Ending balance at Mar. 31, 2021	1,796,827	$ 21,760	966,536	(32,393)	622,944	(87,440)	305,420
Ending balance (in shares) at Mar. 31, 2021		38,648,115
Beginning balance at Dec. 31, 2020	1,779,761	$ 21,697	950,915	(34,867)	636,373	(87,440)	293,083
Beginning balance (in shares) at Dec. 31, 2020		38,521,694
Net income	403,104
Other comprehensive income (loss)	(455)
Ending balance at Sep. 30, 2021	2,021,525	$ 21,817	988,310	(35,098)	756,992	(87,440)	376,944
Ending balance (in shares) at Sep. 30, 2021		38,761,863
Beginning balance at Mar. 31, 2021	1,796,827	$ 21,760	966,536	(32,393)	622,944	(87,440)	305,420
Beginning balance (in shares) at Mar. 31, 2021		38,648,115
Net income	172,133				144,102		28,031
Other comprehensive income (loss)	3,988			2,649			1,339
Issuances of non-vested restricted shares of common stock		$ 22	(22)
Issuances of non-vested restricted shares of common stock (in shares)		44,881
Forfeitures of non-vested restricted shares of common stock		$ (4)	4
Forfeitures of non-vested restricted shares of common stock (in shares)		(7,589)
Stock issuances from exercise of stock options and employee stock purchase plan	5,676	$ 18	5,658
Stock issuances from exercise of stock options and employee stock purchase plan (in shares)		34,311
Retirement of common stock	(863)	$ (1)	(862)
Retirement of common stock (in shares)		(2,965)
Share-based compensation	5,569		5,569
Common stock issued for Acme Refrigeration of Baton Rouge LLC	2,551	$ 4	2,547
Common stock issued for Acme Refrigeration of Baton Rouge LLC (in shares)		8,492
Investment in TEC Distribution LLC	21,040						21,040
Cash dividends declared and paid on Common and Class B common stock	(75,388)				(75,388)
Ending balance at Jun. 30, 2021	1,931,533	$ 21,799	979,430	(29,744)	691,658	(87,440)	355,830
Ending balance (in shares) at Jun. 30, 2021		38,725,245
Net income	164,844				140,865		23,979
Other comprehensive income (loss)	(8,219)			(5,354)			(2,865)
Issuances of non-vested restricted shares of common stock		$ 11	(11)
Issuances of non-vested restricted shares of common stock (in shares)		21,828
Stock issuances from exercise of stock options and employee stock purchase plan	2,487	$ 7	2,480
Stock issuances from exercise of stock options and employee stock purchase plan (in shares)		14,413
Retirement of common stock	(894)	$ (2)	(892)
Retirement of common stock (in shares)		(3,250)
Share-based compensation	6,308		6,308
Common stock issued for Acme Refrigeration of Baton Rouge LLC	997	$ 2	995
Common stock issued for Acme Refrigeration of Baton Rouge LLC (in shares)		3,627
Cash dividends declared and paid on Common and Class B common stock	(75,531)				(75,531)
Ending balance at Sep. 30, 2021	2,021,525	$ 21,817	988,310	(35,098)	756,992	(87,440)	376,944
Ending balance (in shares) at Sep. 30, 2021		38,761,863
Beginning balance at Dec. 31, 2021	1,997,415	$ 21,836	1,003,932	(34,176)	760,796	(87,440)	332,467
Beginning balance (in shares) at Dec. 31, 2021		38,799,632
Net income	134,890				113,298		21,592
Other comprehensive income (loss)	4,381			2,935			1,446
Issuances of non-vested restricted shares of common stock		$ 53	(53)
Issuances of non-vested restricted shares of common stock (in shares)		105,882
Common stock contribution to 401(k) plan	6,737	$ 11	6,726
Common stock contribution to 401(k) plan (in shares)		21,532
Stock issuances from exercise of stock options and employee stock purchase plan	4,420	$ 12	4,408
Stock issuances from exercise of stock options and employee stock purchase plan (in shares)		24,850
Share-based compensation	8,667		8,667
Cash dividends declared and paid on Common and Class B common stock	(75,795)				(75,795)
Ending balance at Mar. 31, 2022	2,080,715	$ 21,912	1,023,680	(31,241)	798,299	(87,440)	355,505
Ending balance (in shares) at Mar. 31, 2022		38,951,896
Beginning balance at Dec. 31, 2021	1,997,415	$ 21,836	1,003,932	(34,176)	760,796	(87,440)	332,467
Beginning balance (in shares) at Dec. 31, 2021		38,799,632
Net income	546,566
Other comprehensive income (loss)	(24,091)
Ending balance at Sep. 30, 2022	2,316,153	$ 21,956	1,047,317	(50,108)	977,050	(87,440)	407,378
Ending balance (in shares) at Sep. 30, 2022		39,039,334
Beginning balance at Mar. 31, 2022	2,080,715	$ 21,912	1,023,680	(31,241)	798,299	(87,440)	355,505
Beginning balance (in shares) at Mar. 31, 2022		38,951,896
Net income	225,506				192,557		32,949
Other comprehensive income (loss)	(9,381)			(6,265)			(3,116)
Issuances of non-vested restricted shares of common stock		$ 11	(11)
Issuances of non-vested restricted shares of common stock (in shares)		21,177
Forfeitures of non-vested restricted shares of common stock		$ (5)	5
Forfeitures of non-vested restricted shares of common stock (in shares)		(10,000)
Common stock contribution to 401(k) plan	9	$ 0	9
Common stock contribution to 401(k) plan (in shares)		28
Stock issuances from exercise of stock options and employee stock purchase plan	3,807	$ 11	3,796
Stock issuances from exercise of stock options and employee stock purchase plan (in shares)		21,939
Retirement of common stock	(2,179)	$ (4)	(2,175)
Retirement of common stock (in shares)		(8,181)
Share-based compensation	6,987		6,987
Cash dividends declared and paid on Common and Class B common stock	(85,689)				(85,689)
Ending balance at Jun. 30, 2022	2,219,775	$ 21,925	1,032,291	(37,506)	905,167	(87,440)	385,338
Ending balance (in shares) at Jun. 30, 2022		38,976,859
Net income	186,170				157,641		28,529
Other comprehensive income (loss)	(19,091)			(12,602)			(6,489)
Issuances of non-vested restricted shares of common stock		$ 7	(7)
Issuances of non-vested restricted shares of common stock (in shares)		13,000
Stock issuances from exercise of stock options and employee stock purchase plan	8,664	$ 25	8,639
Stock issuances from exercise of stock options and employee stock purchase plan (in shares)		51,407
Retirement of common stock	(549)	$ (1)	(548)
Retirement of common stock (in shares)		(1,932)
Share-based compensation	6,942		6,942
Cash dividends declared and paid on Common and Class B common stock	(85,758)				(85,758)
Ending balance at Sep. 30, 2022	$ 2,316,153	$ 21,956	$ 1,047,317	$ (50,108)	$ 977,050	$ (87,440)	$ 407,378
Ending balance (in shares) at Sep. 30, 2022		39,039,334

Condensed Consolidated Unaudited Statements of Shareholders' Equity (Parenthetical) - $ / shares	3 Months Ended
	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022	Sep. 30, 2021	Jun. 30, 2021	Mar. 31, 2021
Cash dividends declared and paid, common stock	$ 2.2	$ 2.2	$ 1.95	$ 1.95	$ 1.95	$ 1.775

Condensed Consolidated Unaudited Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Cash flows from operating activities:
Net income	$ 546,566	$ 403,104
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	23,440	20,874
Share-based compensation	22,017	18,659
Non-cash contribution to 401(k) plan	6,746	5,154
Deferred income tax Provision	6,311	3,966
Other income from investment in unconsolidated entity	(17,289)	(16,267)
Other, net	5,672	1,969
Changes in operating assets and liabilities, net of effects of acquisitions:
Accounts receivable, net	(170,746)	(198,011)
Inventories, net	(276,653)	(170,662)
Accounts payable and other liabilities	212,829	263,752
Other, net	(13)	(12,866)
Net cash provided by operating activities	358,880	319,672
Cash flows from investing activities:
Capital expenditures	(26,526)	(16,770)
Business acquisitions, net of cash acquired	(47)	(129,462)
Proceeds from sale of equity securities	0	5,993
Proceeds from sale of property and equipment	167	108
Net cash used in investing activities	(26,406)	(140,131)
Cash flows from financing activities:
Dividends on Common and Class B common stock	(247,242)	(219,440)
Net (repayments) proceeds under revolving credit agreement	(80,200)	1,724
Repurchases of common stock to satisfy employee withholding tax obligations	(2,471)	(894)
Net repayments of finance lease liabilities	(2,206)	(1,482)
Payment of fees related to revolving credit agreement	0	(22)
Proceeds from non-controlling interest for investment in TEC Distribution LLC	0	21,040
Net proceeds from issuances of common stock	16,635	11,173
Net cash used in financing activities	(315,484)	(187,901)
Effect of foreign exchange rate changes on cash and cash equivalents	(5,030)	(506)
Net increase (decrease) in cash and cash equivalents	11,960	(8,866)
Cash and cash equivalents at beginning of period	118,268	146,067
Cash and cash equivalents at end of period	$ 130,228	137,201
Acme Refrigeration of Baton Rouge LLC [Member]
Supplemental cash flow information:
Common stock issued		2,551
Makdad Industrial Supply Co Inc [Member]
Supplemental cash flow information:
Common stock issued		$ 997

BASIS OF PRESENTATION

9 Months Ended

Sep. 30, 2022

BASIS OF PRESENTATION

1.	BASIS OF PRESENTATION

Basis of Consolidation

Watsco, Inc. (collectively with its subsidiaries, “Watsco,” “we,” “us,” or “our”) was incorporated in Florida in 1956 and is the largest distributor of air conditioning, heating and refrigeration equipment and related parts and supplies (“HVAC/R”) in the HVAC/R distribution industry in North America. The accompanying September 30, 2022 interim condensed consolidated unaudited financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and note disclosures normally included in the annual financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been condensed or omitted pursuant to those rules and regulations, but we believe the disclosures made are adequate to make the information presented not misleading. In the opinion of management, all adjustments, consisting of normal and recurring adjustments, necessary for a fair presentation have been included in the condensed consolidated unaudited financial statements included herein. These statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in our 2021 Annual Report on Form

10-K.

The condensed consolidated unaudited financial statements include the accounts of Watsco, all of its wholly owned subsidiaries, the accounts of four joint ventures with Carrier Global Corporation, which we refer to as Carrier, the accounts of Carrier InterAmerica Corporation, of which we have an 80% controlling interest, and Carrier has a 20%

non-controlling

interest, and our 38.1% investment in Russell Sigler, Inc., which is accounted for under the equity method of accounting. All significant intercompany balances and transactions have been eliminated in consolidation.

The results of operations for the quarter and nine months ended September 30, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022. Sales of residential central air conditioners, heating equipment, and parts and supplies are seasonal. Furthermore, profitability can be impacted favorably or unfavorably based on weather patterns, particularly during the Summer and Winter selling seasons. Demand related to the residential central air conditioning replacement market is typically highest in the second and third quarters, and demand for heating equipment is usually highest in the first and fourth quarters. Demand related to the new construction sectors throughout most of the markets we serve tends to be fairly evenly distributed throughout the year and depends largely on housing completions and related weather and economic conditions.

Equity Method Investments

Investments in which we have the ability to exercise significant influence, but do not control, are accounted for under the equity method of accounting and are included in investment in unconsolidated entity in our condensed consolidated unaudited balance sheets. Under this method of accounting, our proportionate share of the net income or loss of the investee is included in other income in our condensed consolidated unaudited statements of income. The excess, if any, of the carrying amount of our investment over our ownership percentage in the underlying net assets of the investee is attributed to certain fair value adjustments with the remaining portion recognized as goodwill.

Use of Estimates

The preparation of condensed consolidated unaudited financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated unaudited financial statements and the reported amounts of revenues and expenses for the reporting period. Significant estimates include valuation reserves for accounts receivable, net realizable value adjustments to inventories, income taxes, reserves related to loss contingencies and the valuation of goodwill, indefinite-lived intangible assets and long-lived assets. While we believe that these estimates are reasonable, actual results could differ from such estimates.

Impact of the

COVID-19

Pandemic and Economic and Marketplace Dynamics

Since

COVID-19

was declared a pandemic in March 2020, it has had widespread impacts on global financial markets and business practices. Although we learned to navigate

COVID-19

while maintaining our operations in all material respects, the pandemic impacted our operations, and the operations of our customers and suppliers, throughout 2020 and into 2021. However, as the effects of the pandemic have continued to lessen, the impact of the pandemic on our business has been more reflective of greater economic and marketplace dynamics, which include inflation, supply chain disruptions, and labor shortages, rather than pandemic-related issues, such as quarantines, location closures, mandated restrictions, employee illnesses, and travel restrictions. The extent to which these macro-economic and marketplace dynamics impact our business, results of operations, and financial condition will depend on future developments, which are highly uncertain and cannot be predicted, therefore, we cannot reasonably estimate the future impact of such dynamics at this time.

REVENUES

9 Months Ended

Sep. 30, 2022

REVENUES

Disaggregation of Revenues

The following table presents our revenues disaggregated by primary geographical regions and major product lines within our single reporting segment:


	Quarter Ended September 30,						Nine Months Ended September 30,
	2022			2021			2022			2021
Primary Geographical Regions:
United States	$	1,851,071		$	1,615,319		$	5,156,846		$	4,291,838
Canada		100,567			102,491			303,149			290,863
Latin America and the Caribbean		84,158			64,759			233,126			185,626

	$	2,035,796		$	1,782,569		$	5,693,121		$	4,768,327

Major Product Lines:
HVAC equipment		69	%		69	%		69	%		69	%
Other HVAC products		27	%		27	%		27	%		27	%
Commercial refrigeration products		4	%		4	%		4	%		4	%

		100	%		100	%		100	%		100	%

- 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 https://asc.fasb.org/topic&trid=49130388

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 10
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130551-203045

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (b)(2)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130556-203045

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130554-203045

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 9
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130550-203045

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (e)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130554-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130554-203045

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (d)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130554-203045

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 15
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130558-203045

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (c)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130554-203045

+ Details

EARNINGS PER SHARE

9 Months Ended

Sep. 30, 2022

EARNINGS PER SHARE

3.	EARNINGS PER SHARE

The following table presents the calculation of basic and diluted earnings per share for our Common and Class B common stock:


	Quarter Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Basic Earnings per Share:
Net income attributable to Watsco, Inc. shareholders	$	157,641	$	140,865	$	463,496	$	340,059
Less: distributed and undistributed earnings allocated to non-vested restricted common stock		14,387		12,590		42,293		30,182

Earnings allocated to Watsco, Inc. shareholders	$	143,254	$	128,275	$	421,203	$	309,877


Weighted-average common shares outstanding - Basic		35,450,277		35,260,126		35,401,179		35,222,865
Basic earnings per share for Common and Class B common stock	$	4.04	$	3.64	$	11.90	$	8.80
Allocation of earnings for Basic:
Common stock	$	132,846	$	118,905	$	390,557	$	287,217
Class B common stock		10,408		9,370		30,646		22,660

	$	143,254	$	128,275	$	421,203	$	309,877

Diluted Earnings per Share:
Net income attributable to Watsco, Inc. shareholders	$	157,641	$	140,865	$	463,496	$	340,059
Less: distributed and undistributed earnings allocated to non-vested restricted common stock		14,368		12,563		42,228		30,132

Earnings allocated to Watsco, Inc. shareholders	$	143,273	$	128,302	$	421,268	$	309,927


Weighted-average common shares outstanding - Basic		35,450,277		35,260,126		35,401,179		35,222,865
Effect of dilutive stock options		112,008		181,852		128,309		177,389

Weighted-average common shares outstanding - Diluted		35,562,285		35,441,978		35,529,488		35,400,254


Diluted earnings per share for Common and Class B common stock	$	4.03	$	3.62	$	11.86	$	8.75

Anti-dilutive stock options not included above		208,610		63,959		181,115		27,513

Diluted earnings per share for our Common stock assumes the conversion of all of our Class B common stock into Common stock as of the beginning of the fiscal year; therefore, no allocation of earnings to Class B common stock is required. At September 30, 2022 and 2021, our outstanding Class B common stock was convertible into 2,575,725 and 2,575,698 shares of our Common stock, respectively.

OTHER COMPREHENSIVE LOSS

9 Months Ended

Sep. 30, 2022

OTHER COMPREHENSIVE LOSS

4.	OTHER COMPREHENSIVE LOSS

Other comprehensive

loss consists of the foreign currency translation adjustment associated with our Canadian operations’ use of the Canadian dollar as their functional currency and changes in the unrealized gains on cash flow hedging instruments. The tax effects allocated to each component of other comprehensive loss were as follows:


	Quarter Ended September 30,						Nine Months Ended September 30,
	2022			2021			2022			2021
Foreign currency translation adjustment	$	(19,091	)	$	(8,219	)	$	(24,091	)	$	(746	)

Unrealized gain on cash flow hedging instruments		—			—			—			97
Income tax expense		—			—			—			(27	)

Unrealized gain on cash flow hedging instruments, net of tax		—			—			—			70


Reclassification of loss on cash flow hedging instruments into earnings		—			—			—			305
Income tax benefit		—			—			—			(84	)

Reclassification of loss on cash flow hedging instruments into earnings, net of tax		—			—			—			221


Other comprehensive loss	$	(19,091	)	$	(8,219	)	$	(24,091	)	$	(455	)

The changes in each component of accumulated other comprehensive loss, net of tax, were a

follows:


Nine Months Ended September 30,	2022			2021
Foreign currency translation adjustment:

Beginning balance	$	(34,176	)	$	(34,694	)
Current period other comprehensive loss		(15,932	)		(406	)

Ending balance		(50,108	)		(35,100	)

Cash flow hedging instruments:
Beginning balance		—			(173	)
Current period other comprehensive income		—			43
Reclassification adjustment		—			132

Ending balance		—			2

Accumulated other comprehensive loss, net of tax	$	(50,108	)	$	(35,098	)

ACQUISITIONS

9 Months Ended

Sep. 30, 2022

ACQUISITIONS

5.	ACQUISITIONS

Makdad Industrial Supply Co., Inc.

On August 20, 2021, one of our wholly owned subsidiaries acquired Makdad Industrial Supply Co., Inc., a distributor of air conditioning and heating products operating from

six

locations in Pennsylvania. Consideration for the purchase consisted of $3,164 in cash and the issuance of 3,627 shares of Common stock having a fair value of $997, net of cash acquired of $204. The purchase price resulted in the recognition of $1,041 in goodwill and intangibles. The fair value of the identified intangible assets was $596 and consisted of $423 in trade names and distribution rights, and $173 in customer relationships to be amortized over an

18-year

period. The tax basis of such goodwill is deductible for income tax purposes over 15 years.

Acme Refrigeration of Baton Rouge LLC

On May 7, 2021, we acquired certain assets and assumed certain liabilities of Acme Refrigeration of Baton Rouge LLC, a distributor of air conditioning, heating, and refrigeration products, operating from 18 locations in Louisiana and Mississippi, for $22,855 less certain average revolving indebtedness. We formed a new, wholly owned subsidiary, Acme Refrigeration LLC, which operates this business. Consideration for the purchase consisted of $18,051 in cash, 8,492 shares of Common stock having a fair value of $2,551, and $3,141 for repayment of indebtedness, net of cash acquired of $1,340. The purchase price resulted in the recognition of $3,710 in goodwill and intangibles. The fair value of the identified intangible assets was $2,124 and consisted of $1,508 in trade names and distribution rights, and $616 in customer relationships to be amortized over an

18-year

period. The tax basis of such goodwill is deductible for income tax purposes over 15 years.

Temperature Equipment Corporation

On April 9, 2021, we acquired certain assets and assumed certain liabilities comprising the HVAC distribution business of Temperature Equipment Corporation, an HVAC distributor operating from 32 locations in Illinois, Indiana, Kansas, Michigan, Minnesota, Missouri and Wisconsin. We formed a new, stand-alone joint venture with Carrier, TEC Distribution LLC (“TEC”), that operates this business. We have an 80% controlling interest in TEC, and Carrier has a 20%

non-controlling

interest. Consideration for the purchase was paid in cash, consisting of $105,200 paid to Temperature Equipment Corporation (Carrier contributed $21,040 and we contributed $84,160) and $1,497 for repayment of indebtedness.

The purchase price resulted in the recognition of $38,624 in goodwill and intangibles. The fair value of the identified intangible assets was $19,900 and consisted of $15,700 in trade names and distribution rights, and $4,200 in customer relationships to be amortized over an

18-year

period. The tax basis of such goodwill is deductible for income tax purposes over 15 years.

The table below presents the allocation of the total consideration to tangible and intangible assets acquired and liabilities assumed from the acquisition of our 80% controlling interest in TEC based on their respective fair values as of April 9, 2021:


Accounts receivable	$	33,315
Inventories		71,325
Other current assets		962
Property and equipment		2,590
Operating lease ROU assets		53,829
Goodwill		18,724
Intangibles		19,900
Accounts payable		(25,393	)
Accrued expenses and other current liabilities		(20,509	)
Operating lease liabilities, net of current portion		(48,046	)

Total	$	106,697

The results of operations of these acquisitions have been included in the consolidated financial statements from their respective dates of acquisition. The pro forma effect of these acquisitions was not deemed significant to the consolidated financial statements.

DERIVATIVES

9 Months Ended

Sep. 30, 2022

DERIVATIVES

6.	DERIVATIVES

We enter into foreign currency forward and option contracts intended to offset the earnings impact that foreign exchange rate fluctuations would otherwise have on certain monetary liabilities that are denominated in nonfunctional currencies.

Cash Flow Hedging Instruments

We enter into foreign currency forward contracts that are designated as cash flow hedges. The settlement of these derivatives results in reclassifications from accumulated other comprehensive loss to earnings for the period in which the settlement of these instruments occurs. The maximum period for which we hedge our cash flow using these instruments is 12 months. At September 30, 2022, no foreign currency forward contracts were designated as cash flow hedges.

The impact from foreign exchange derivative instruments designated as cash flow hedges was as

follows:


	Quarter Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
G ain recorded in accumulated other comprehensive loss	$	—	$	—	$	—	$	97
L oss reclassified from accumulated other comprehensive loss into earnings	$	—	$	—	$	—	$	305

Derivatives Not Designated as Hedging Instruments

We have also entered into foreign currency forward and option contracts that are either not designated as hedges or did not qualify for hedge accounting. These derivative instruments were effective economic hedges for all of the periods presented. The fair value gains and losses on these contracts are recognized in earnings as a component of selling, general and administrative expenses. We had only one foreign currency exchange contract not designated as a hedging

instrument

at September 30, 2022, the total notional value of which was $7,500, and such contract subsequently expired in October 2022.

We recognized (losses)

gains

of $(149) and $83 from foreign currency forward and option contracts not designated as hedging instruments in our condensed consolidated unaudited statements of income for the quarters ended September 30, 2022 and 2021, respectively. We recognized losses

of $524 and $101 from foreign currency forward and option contracts not designated as hedging instruments in our condensed consolidated unaudited statements of income for the nine months ended September 30, 2022 and 2021, respectively.

The following table summarizes the fair value of derivative instruments, which consist solely of foreign exchange contracts, included in accrued expenses and other current liabilities in our condensed consolidated unaudited balance sheets. Se

Note


	Asset Derivatives				Liability Derivatives
	September 30, 2022		December 31, 2021		September 30, 2022		December 31, 2021




Derivatives designated as hedging instruments	$	—	$	—	$	—	$	—
Derivatives not designated as hedging instruments		—		—		13		5

Total derivative instruments	$	—	$	—	$	13	$	5

FAIR VALUE MEASUREMENTS

9 Months Ended

Sep. 30, 2022

FAIR VALUE MEASUREMENTS

7.	FAIR VALUE MEASUREMENTS

The following tables present our assets and liabilities carried at fair value that are measured on a recurring

basis:


		Total		Fair Value Measurements at September 30, 2022 Using
	Balance Sheet Location	Total		Level 1		Level 2		Level 3
Assets:

Equity securities	Other assets	$	596	$	596		—		—
Private equities	Other assets	$	1,000		—		—	$	1,000
Liabilities:
Derivative financial instruments	Accrued expenses and other current liabilities	$	13		—	$	13		—


		Total		Fair Value Measurements at December 31, 2021 Using
	Balance Sheet Location	Total		Level 1		Level 2		Level 3

Assets:
Equity securities	Other assets	$	1,790	$	1,790		—		—
Private equities	Other assets	$	1,000		—		—	$	1,000
Liabilities:
Derivative financial instruments	Accrued expenses and other current liabilities	$	5		—	$	5		—

The following is a description of the valuation techniques used for these assets and liabilities, as well as the level of input used to measure fair value:

Equity securities

– these investments are exchange-traded equity securities. Fair values for these investments are based on closing stock prices from active markets and are therefore classified within Level 1 of the fair value hierarchy.

Private equities

– other investment in which fair value inputs are unobservable.

Derivative financial instruments

– these derivatives are foreign currency forward and option contracts. See Note 6. Fair value is based on observable market inputs, such as forward rates in active markets; therefore, we classify these derivatives within Level 2 of the valuation hierarchy.

During the nine months ended September 30, 2021, we recognized a realized gain of $3,815 recorded in our condensed consolidated unaudited statement of income attributable to the sale of certain equity securities.

- 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

SHAREHOLDERS' EQUITY

9 Months Ended

Sep. 30, 2022

SHAREHOLDERS' EQUITY

8.	SHAREHOLDERS’ EQUITY

At-the-Market

Offering Program

On August 6, 2021, we entered into a sales agreement with Robert W. Baird & Co. Inc. (“Baird”), which enables the Company to issue and sell shares of Common stock in one or more negotiated transactions or transactions that are deemed to be “at the market” offerings as defined in Rule 415 under the Securities Act of 1933, as amended (the “Securities Act”), for a maximum aggregate offering amount of up to $300,000 (the “ATM Program”). The offer and sale of our Common stock pursuant to the ATM Program has been registered under the Securities Act pursuant to our automatically effective shelf registration statement on Form

S-3

(File

No. 333-260758).

On February 25, 2022, we entered into an amended and restated sales agreement, together with Baird and Goldman Sachs & Co. LLC (“GS”), for the purpose of adding GS as an additional sales agent and making necessary conforming changes. The amended and restated sales agreement otherwise retains all material terms of the original sales agreement.

As of September 30, 2022, no shares of Common stock had been sold under the ATM Program.

Common Stock Dividends

We paid cash dividends of $2.20, $1.95, $6.35, and $5.675 per share of both Common stock and Class B common stock during the quarters and nine months ended September 30, 2022 and 2021, respectively.

Non-Vested

Restricted Stock

During the quarter and nine months ended September 30, 2022, 879 shares of Class B common stock with an aggregate fair market value of $252, and 9,060 shares of Class B common stock with an aggregate fair market value of $2,431, respectively, were withheld as payment in lieu of cash to satisfy tax withholding obligations in connection with the vesting of

non-vested

restricted stock. These shares were retired upon delivery. During both the quarter and nine months ended September 30, 2021, 3,250 shares of Class B common stock with an aggregate fair market value of $894 were withheld as payment in lieu of cash to satisfy tax withholding obligations in connection with the vesting of

non-vested

restricted stock. These shares were retired upon delivery.

Exercise of Stock Options

Cash received from Common stock issued as a result of stock options exercised during the quarters and nine months ended September 30, 2022 and 2021, was $7,929, $2,094, $15,151, and $9,940, respectively.

During both the quarter and nine months ended

September 30, 2022, 1,053 shares of Common stock with an aggregate fair market value of $298 were withheld as payment in lieu of cash for stock option exercises. These shares were retired upon delivery. During the nine months ended September 30, 2021, 2,965 shares of Common stock with an aggregate fair market value of $863 were withheld as payment in lieu of cash for stock option exercises. These shares were retired upon delivery.

Employee Stock Purchase Plan

During the quarters ended September 30, 2022 and 2021, we received net proceeds of $478 and $392, respectively, for shares of our Common stock purchased under our employee stock purchase plan. During the nine months ended September 30, 2022 and 2021, we received net proceeds of $1,484 and $1,233, respectively, for shares of our Common stock purchased under our employee stock purchase plan.

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

+ References

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+ Details

COMMITMENTS AND CONTINGENCIES

9 Months Ended

Sep. 30, 2022

COMMITMENTS AND CONTINGENCIES

9.	COMMITMENTS AND CONTINGENCIES

Litigation, Claims and Assessments

We are involved in litigation incidental to the operation of our business. We vigorously defend all matters in which we or our subsidiaries are named defendants and, for insurable losses, maintain significant levels of insurance to protect against adverse judgments, claims or assessments that may affect us. Although the adequacy of existing insurance coverage and the outcome of any legal proceedings cannot be predicted with certainty, based on the current information available, we do not believe the ultimate liability associated with any known claims or litigation will have a material adverse effect on our financial condition or results of operations.

Self-Insurance

Self-insurance reserves are maintained relative to company-wide casualty insurance and health benefit programs. The level of exposure from catastrophic events is limited by the purchase of stop-loss and aggregate liability reinsurance coverage. When estimating the self-insurance liabilities and related reserves, management considers a number of factors, which include historical claims experience, demographic factors, severity factors, and valuations provided by independent third-party actuaries. Management reviews its assumptions with its independent third-party actuaries to evaluate whether the self-insurance reserves are adequate. If actual claims or adverse development of loss reserves occur and exceed these estimates, additional reserves may be required. Reserves in the amounts of $10,715 and $7,253 at September 30, 2022 and December 31, 2021, respectively, were established related to such programs and are included in accrued expenses and other current liabilities in our condensed consolidated unaudited balance sheets.

RELATED PARTY TRANSACTIONS

9 Months Ended

Sep. 30, 2022

RELATED PARTY TRANSACTIONS

10.	RELATED PARTY TRANSACTIONS

Purchases from Carrier and its affiliates comprised 63% and 59% of all inventory purchases made during the quarters ended September 30, 2022 and 2021, respectively. Purchases from Carrier and its affiliates comprised 60% and 64% of all inventory purchases made during the nine months ended September 30, 2022 and 2021, respectively. At September 30, 2022 and December 31, 2021, approximately $167,000 and $90,000, respectively, was payable to Carrier and its affiliates, net of receivables. We also sell HVAC products to Carrier and its affiliates. Revenues in our condensed consolidated unaudited statements of income for the quarters and nine months ended September 30, 2022 and 2021 included approximately $26,000, $30,000, $76,000, and $86,000, respectively, of sales to Carrier and its affiliates. We believe these transactions are conducted on terms equivalent to an

arm’s-length

basis in the ordinary course of business.

A member of our Board of Directors is the Senior Chairman of Greenberg Traurig, P.A., which serves as our principal outside counsel for compliance and acquisition-related legal services. During the quarters and nine months ended September 30, 2022 and 2021, fees to this firm for services performed were $40, $83, $169, and $181, respectively. At September 30, 2022 and December 31, 2021, $37 and $34, respectively, was payable to this

firm.

SUBSEQUENT EVENTS

9 Months Ended

Sep. 30, 2022

SUBSEQUENT EVENTS

11.	SUBSEQUENT EVENTS

On October 15, 2022, 975,622

shares of Class B restricted stock held by an affiliate of our Chief Executive Officer (“CEO”) vested. The vested shares had a value of $265,106 based on the closing price of Watsco’s Class B common stock as of that date. This vested value was treated as taxable compensation to our CEO for income tax purposes and was subject to statutory withholding. Upon vesting, we funded $104,319 in statutory withholding, which, in turn, was satisfied by the CEO through a cash payment of $19,700 and by surrendering of 311,408 shares of Watsco Class B common stock. Accordingly, 664,214 shares of Watsco Class B common stock were retained by the affiliate of our CEO, and we retired the surrendered shares. The value of the vested shares will be deducted on our 2022 income tax return and our provision for income taxes will reflect an income tax benefit and related reduction in our effective tax rate.

On October 18, 2022, our Board of Directors approved an increase to the quarterly cash dividend per share of Common and Class B common stock to $2.45 per share from $2.20 per share, beginning with the dividend that will be paid in January 2023.

BASIS OF PRESENTATION (Policies)	9 Months Ended
BASIS OF PRESENTATION (Policies)	Sep. 30, 2022
Basis of Consolidation	Basis of Consolidation Watsco, Inc. (collectively with its subsidiaries, “Watsco,” “we,” “us,” or “our”) was incorporated in Florida in 1956 and is the largest distributor of air conditioning, heating and refrigeration equipment and related parts and supplies (“HVAC/R”) in the HVAC/R distribution industry in North America. The accompanying September 30, 2022 interim condensed consolidated unaudited financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and note disclosures normally included in the annual financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been condensed or omitted pursuant to those rules and regulations, but we believe the disclosures made are adequate to make the information presented not misleading. In the opinion of management, all adjustments, consisting of normal and recurring adjustments, necessary for a fair presentation have been included in the condensed consolidated unaudited financial statements included herein. These statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in our 2021 Annual Report on Form 10-K. The condensed consolidated unaudited financial statements include the accounts of Watsco, all of its wholly owned subsidiaries, the accounts of four joint ventures with Carrier Global Corporation, which we refer to as Carrier, the accounts of Carrier InterAmerica Corporation, of which we have an 80% controlling interest, and Carrier has a 20% non-controlling interest, and our 38.1% investment in Russell Sigler, Inc., which is accounted for under the equity method of accounting. All significant intercompany balances and transactions have been eliminated in consolidation. The results of operations for the quarter and nine months ended September 30, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022. Sales of residential central air conditioners, heating equipment, and parts and supplies are seasonal. Furthermore, profitability can be impacted favorably or unfavorably based on weather patterns, particularly during the Summer and Winter selling seasons. Demand related to the residential central air conditioning replacement market is typically highest in the second and third quarters, and demand for heating equipment is usually highest in the first and fourth quarters. Demand related to the new construction sectors throughout most of the markets we serve tends to be fairly evenly distributed throughout the year and depends largely on housing completions and related weather and economic conditions.
Equity Method Investments	Equity Method Investments Investments in which we have the ability to exercise significant influence, but do not control, are accounted for under the equity method of accounting and are included in investment in unconsolidated entity in our condensed consolidated unaudited balance sheets. Under this method of accounting, our proportionate share of the net income or loss of the investee is included in other income in our condensed consolidated unaudited statements of income. The excess, if any, of the carrying amount of our investment over our ownership percentage in the underlying net assets of the investee is attributed to certain fair value adjustments with the remaining portion recognized as goodwill.
Use of Estimates	Use of Estimates The preparation of condensed consolidated unaudited financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated unaudited financial statements and the reported amounts of revenues and expenses for the reporting period. Significant estimates include valuation reserves for accounts receivable, net realizable value adjustments to inventories, income taxes, reserves related to loss contingencies and the valuation of goodwill, indefinite-lived intangible assets and long-lived assets. While we believe that these estimates are reasonable, actual results could differ from such estimates.
Impact of Pandemic, Economic and Marketplace Dynamics	Impact of the COVID-19 Pandemic and Economic and Marketplace Dynamics Since COVID-19 was declared a pandemic in March 2020, it has had widespread impacts on global financial markets and business practices. Although we learned to navigate COVID-19 while maintaining our operations in all material respects, the pandemic impacted our operations, and the operations of our customers and suppliers, throughout 2020 and into 2021. However, as the effects of the pandemic have continued to lessen, the impact of the pandemic on our business has been more reflective of greater economic and marketplace dynamics, which include inflation, supply chain disruptions, and labor shortages, rather than pandemic-related issues, such as quarantines, location closures, mandated restrictions, employee illnesses, and travel restrictions. The extent to which these macro-economic and marketplace dynamics impact our business, results of operations, and financial condition will depend on future developments, which are highly uncertain and cannot be predicted, therefore, we cannot reasonably estimate the future impact of such dynamics at this time.

REVENUES (Tables)

9 Months Ended

Sep. 30, 2022

Summary of Disaggregated Revenue

The following table presents our revenues disaggregated by primary geographical regions and major product lines within our single reporting segment:


	Quarter Ended September 30,						Nine Months Ended September 30,
	2022			2021			2022			2021
Primary Geographical Regions:
United States	$	1,851,071		$	1,615,319		$	5,156,846		$	4,291,838
Canada		100,567			102,491			303,149			290,863
Latin America and the Caribbean		84,158			64,759			233,126			185,626

	$	2,035,796		$	1,782,569		$	5,693,121		$	4,768,327

Major Product Lines:
HVAC equipment		69	%		69	%		69	%		69	%
Other HVAC products		27	%		27	%		27	%		27	%
Commercial refrigeration products		4	%		4	%		4	%		4	%

		100	%		100	%		100	%		100	%

EARNINGS PER SHARE (Tables)

9 Months Ended

Sep. 30, 2022

Schedule of Basic and Diluted Earnings Per Common Share

The following table presents the calculation of basic and diluted earnings per share for our Common and Class B common stock:


	Quarter Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Basic Earnings per Share:
Net income attributable to Watsco, Inc. shareholders	$	157,641	$	140,865	$	463,496	$	340,059
Less: distributed and undistributed earnings allocated to non-vested restricted common stock		14,387		12,590		42,293		30,182

Earnings allocated to Watsco, Inc. shareholders	$	143,254	$	128,275	$	421,203	$	309,877


Weighted-average common shares outstanding - Basic		35,450,277		35,260,126		35,401,179		35,222,865
Basic earnings per share for Common and Class B common stock	$	4.04	$	3.64	$	11.90	$	8.80
Allocation of earnings for Basic:
Common stock	$	132,846	$	118,905	$	390,557	$	287,217
Class B common stock		10,408		9,370		30,646		22,660

	$	143,254	$	128,275	$	421,203	$	309,877

Diluted Earnings per Share:
Net income attributable to Watsco, Inc. shareholders	$	157,641	$	140,865	$	463,496	$	340,059
Less: distributed and undistributed earnings allocated to non-vested restricted common stock		14,368		12,563		42,228		30,132

Earnings allocated to Watsco, Inc. shareholders	$	143,273	$	128,302	$	421,268	$	309,927


Weighted-average common shares outstanding - Basic		35,450,277		35,260,126		35,401,179		35,222,865
Effect of dilutive stock options		112,008		181,852		128,309		177,389

Weighted-average common shares outstanding - Diluted		35,562,285		35,441,978		35,529,488		35,400,254


Diluted earnings per share for Common and Class B common stock	$	4.03	$	3.62	$	11.86	$	8.75

Anti-dilutive stock options not included above		208,610		63,959		181,115		27,513

OTHER COMPREHENSIVE LOSS (Tables)

9 Months Ended

Sep. 30, 2022

Schedule of Tax Effects Allocated to Each Component of Other Comprehensive Loss

The tax effects allocated to each component of other comprehensive loss were as follows:


	Quarter Ended September 30,						Nine Months Ended September 30,
	2022			2021			2022			2021
Foreign currency translation adjustment	$	(19,091	)	$	(8,219	)	$	(24,091	)	$	(746	)

Unrealized gain on cash flow hedging instruments		—			—			—			97
Income tax expense		—			—			—			(27	)

Unrealized gain on cash flow hedging instruments, net of tax		—			—			—			70


Reclassification of loss on cash flow hedging instruments into earnings		—			—			—			305
Income tax benefit		—			—			—			(84	)

Reclassification of loss on cash flow hedging instruments into earnings, net of tax		—			—			—			221


Other comprehensive loss	$	(19,091	)	$	(8,219	)	$	(24,091	)	$	(455	)

Schedule of Accumulated Other Comprehensive Loss

The changes in each component of accumulated other comprehensive loss, net of tax, were a

follows:


Nine Months Ended September 30,	2022			2021
Foreign currency translation adjustment:

Beginning balance	$	(34,176	)	$	(34,694	)
Current period other comprehensive loss		(15,932	)		(406	)

Ending balance		(50,108	)		(35,100	)

Cash flow hedging instruments:
Beginning balance		—			(173	)
Current period other comprehensive income		—			43
Reclassification adjustment		—			132

Ending balance		—			2

Accumulated other comprehensive loss, net of tax	$	(50,108	)	$	(35,098	)

ACQUISITIONS (Tables)

9 Months Ended

Sep. 30, 2022

Business Combinations [Abstract]

Summary of tangible and intangible assets acquired and liabilities assumed


Accounts receivable	$	33,315
Inventories		71,325
Other current assets		962
Property and equipment		2,590
Operating lease ROU assets		53,829
Goodwill		18,724
Intangibles		19,900
Accounts payable		(25,393	)
Accrued expenses and other current liabilities		(20,509	)
Operating lease liabilities, net of current portion		(48,046	)

Total	$	106,697

DERIVATIVES (Tables)

9 Months Ended

Sep. 30, 2022

Impact from Foreign Exchange Derivative Instruments Designated as Cash Flow Hedges

The impact from foreign exchange derivative instruments designated as cash flow hedges was as

follows:


	Quarter Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
G ain recorded in accumulated other comprehensive loss	$	—	$	—	$	—	$	97
L oss reclassified from accumulated other comprehensive loss into earnings	$	—	$	—	$	—	$	305

Fair Value of Derivative Instruments and Location in the Balance Sheets

Note


	Asset Derivatives				Liability Derivatives
	September 30, 2022		December 31, 2021		September 30, 2022		December 31, 2021




Derivatives designated as hedging instruments	$	—	$	—	$	—	$	—
Derivatives not designated as hedging instruments		—		—		13		5

Total derivative instruments	$	—	$	—	$	13	$	5

FAIR VALUE MEASUREMENTS (Tables)

9 Months Ended

Sep. 30, 2022

Assets and Liabilities Measured at Fair Value on Recurring Basis

The following tables present our assets and liabilities carried at fair value that are measured on a recurring

basis:


		Total		Fair Value Measurements at September 30, 2022 Using
	Balance Sheet Location	Total		Level 1		Level 2		Level 3
Assets:

Equity securities	Other assets	$	596	$	596		—		—
Private equities	Other assets	$	1,000		—		—	$	1,000
Liabilities:
Derivative financial instruments	Accrued expenses and other current liabilities	$	13		—	$	13		—


		Total		Fair Value Measurements at December 31, 2021 Using
	Balance Sheet Location	Total		Level 1		Level 2		Level 3

Assets:
Equity securities	Other assets	$	1,790	$	1,790		—		—
Private equities	Other assets	$	1,000		—		—	$	1,000
Liabilities:
Derivative financial instruments	Accrued expenses and other current liabilities	$	5		—	$	5		—

Basis of Presentation - Additional Information (Detail)	Sep. 30, 2022 Entity
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of Joint Ventures	4

Revenues - Summary of Disaggregated Revenue (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Disaggregation of Revenue [Line Items]
Revenues from product lines, percentage	100.00%	100.00%	100.00%	100.00%
Revenues	$ 2,035,796	$ 1,782,569	$ 5,693,121	$ 4,768,327
United States
Disaggregation of Revenue [Line Items]
Revenues	1,851,071	1,615,319	5,156,846	4,291,838
Canada
Disaggregation of Revenue [Line Items]
Revenues	100,567	102,491	303,149	290,863
Latin America and the Caribbean
Disaggregation of Revenue [Line Items]
Revenues	$ 84,158	$ 64,759	$ 233,126	$ 185,626
HVAC Equipment
Disaggregation of Revenue [Line Items]
Revenues from product lines, percentage	69.00%	69.00%	69.00%	69.00%
Other HVAC Products
Disaggregation of Revenue [Line Items]
Revenues from product lines, percentage	27.00%	27.00%	27.00%	27.00%
Commercial Refrigeration Products
Disaggregation of Revenue [Line Items]
Revenues from product lines, percentage	4.00%	4.00%	4.00%	4.00%

- Definition

Amount of revenue recognized from goods sold, services rendered, insurance premiums, or other activities that constitute an earning process. Includes, but is not limited to, investment and interest income before deduction of interest expense when recognized as a component of revenue, and sales and trading gain (loss).

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-Subparagraph (a)
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+ Details

Earnings Per Share - Schedule of Basic and Diluted Earnings per Common Share (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Basic Earnings per Share:
Net income attributable to Watsco, Inc. shareholders	$ 157,641	$ 140,865	$ 463,496	$ 340,059
Basic earnings per share for Common and Class B common stock	$ 4.04	$ 3.64	$ 11.9	$ 8.8
Diluted Earnings per Share:
Net income attributable to Watsco, Inc. shareholders	$ 157,641	$ 140,865	$ 463,496	$ 340,059
Diluted earnings per share for Common and Class B common stock	$ 4.03	$ 3.62	$ 11.86	$ 8.75
Class B Common Stock
Basic Earnings per Share:
Earnings allocated to Watsco, Inc. shareholders - Basic	$ 10,408	$ 9,370	$ 30,646	$ 22,660
Common Stock
Basic Earnings per Share:
Earnings allocated to Watsco, Inc. shareholders - Basic	132,846	118,905	390,557	287,217
Common Stock \| Class B Common Stock
Basic Earnings per Share:
Net income attributable to Watsco, Inc. shareholders	157,641	140,865	463,496	340,059
Less: distributed and undistributed earnings allocated to non-vested restricted common stock	14,387	12,590	42,293	30,182
Earnings allocated to Watsco, Inc. shareholders - Basic	$ 143,254	$ 128,275	$ 421,203	$ 309,877
Weighted-average common shares outstanding - Basic	35,450,277	35,260,126	35,401,179	35,222,865
Basic earnings per share for Common and Class B common stock	$ 4.04	$ 3.64	$ 11.9	$ 8.8
Diluted Earnings per Share:
Net income attributable to Watsco, Inc. shareholders	$ 157,641	$ 140,865	$ 463,496	$ 340,059
Less: distributed and undistributed earnings allocated to non-vested restricted common stock – Diluted	14,368	12,563	42,228	30,132
Earnings allocated to Watsco, Inc. shareholders - Diluted	$ 143,273	$ 128,302	$ 421,268	$ 309,927
Weighted-average common shares outstanding - Basic	35,450,277	35,260,126	35,401,179	35,222,865
Effect of dilutive stock options	112,008	181,852	128,309	177,389
Weighted-average common shares outstanding - Diluted	35,562,285	35,441,978	35,529,488	35,400,254
Diluted earnings per share for Common and Class B common stock	$ 4.03	$ 3.62	$ 11.86	$ 8.75
Anti-dilutive stock options not included above	208,610	63,959	181,115	27,513

Earnings Per Share - Additional Information (Detail) - shares	Sep. 30, 2022	Sep. 30, 2021
Earnings Per Share [Line Items]
Class B common stock conversion, number of shares	2,575,725	2,575,698

Other comprehensive loss - Schedule of Tax Effects Allocated to Each Component of Other Comprehensive loss (Detail) - USD ($) $ in Thousands	3 Months Ended						9 Months Ended
	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022	Sep. 30, 2021	Jun. 30, 2021	Mar. 31, 2021	Sep. 30, 2022	Sep. 30, 2021
Components Of Other Comprehensive Income Loss [Line Items]
Foreign currency translation adjustment	$ (19,091)			$ (8,219)			$ (24,091)	$ (746)
Unrealized gain on cash flow hedging instruments	0			0			0	97
Income tax expense	0			0			0	(27)
Unrealized gain on cash flow hedging instruments, net of tax	0			0			0	70
Reclassification of loss on cash flow hedging instruments into earnings	0			0			0	305
Income tax benefit	0			0			0	(84)
Reclassification of loss on cash flow hedging instruments into earnings, net of tax	0			0			0	221
Other comprehensive loss	$ (19,091)	$ (9,381)	$ 4,381	$ (8,219)	$ 3,988	$ 3,776	$ (24,091)	$ (455)

- Definition

Amount after tax and reclassification adjustments of other comprehensive income (loss).

+ References

+ Details

Other comprehensive loss - Schedule of Accumulated Other Comprehensive Loss (Detail) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	$ (34,176)
Ending balance	(50,108)	$ (35,098)
Foreign Currency Translation Adjustment
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	(34,176)	(34,694)
Current period other comprehensive (loss) income	(15,932)	(406)
Ending balance	(50,108)	(35,100)
Cash Flow Hedging Instruments
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	0	(173)
Current period other comprehensive (loss) income	0	43
Reclassification adjustment	0	132
Ending balance	$ 0	$ 2

- Definition

Accumulated change in equity from transactions and other events and circumstances from non-owner sources, net of tax effect, at period end. Excludes Net Income (Loss), and accumulated changes in equity from transactions resulting from investments by owners and distributions to owners. Includes foreign currency translation items, certain pension adjustments, unrealized gains and losses on certain investments in debt and equity securities, other than temporary impairment (OTTI) losses related to factors other than credit losses on available-for-sale and held-to-maturity debt securities that an entity does not intend to sell and it is not more likely than not that the entity will be required to sell before recovery of the amortized cost basis, as well as changes in the fair value of derivatives related to the effective portion of a designated cash flow hedge.

+ References + Details

Acquisitions - Additional Information (Detail) $ in Thousands				9 Months Ended
	Aug. 20, 2021 USD ($) Location shares	May 07, 2021 USD ($) Location shares	Apr. 09, 2021 USD ($) Location	Sep. 30, 2021 USD ($)
TEC Distribution LLC [Member]
Business Acquisition [Line Items]
Number of locations in which the company operates \| Location			32
Goodwill and intangibles acquired			$ 38,624
Business Combination, Consideration Transferred			105,200
Intangible assets acquired			$ 19,900
Number of years goodwill is deductible for tax purposes			15 years
Repayments of Debt			$ 1,497
TEC Distribution LLC [Member] \| Carrier [Member]
Business Acquisition [Line Items]
Business Combination, Consideration Transferred			$ 21,040
Percentage of Voting Interests Acquired			20.00%
TEC Distribution LLC [Member] \| Controlling Interest [Member]
Business Acquisition [Line Items]
Business Combination, Consideration Transferred			$ 84,160
Percentage of Voting Interests Acquired			80.00%
TEC Distribution LLC [Member] \| Trade Names and Distribution Rights [Member]
Business Acquisition [Line Items]
Goodwill and intangibles acquired			$ 15,700
TEC Distribution LLC [Member] \| Customer Relationships [Member]
Business Acquisition [Line Items]
Goodwill and intangibles acquired			$ 4,200
Amortization period			18 years
Makdad Industrial Supply Co Inc [Member]
Business Acquisition [Line Items]
Number of locations in which the company operates \| Location	6
Cash consideration for Business Acquisition	$ 3,164
Number of shares issuable \| shares	3,627
Fair value of equity shares issued or issuable	$ 997			$ 997
Goodwill and intangibles acquired	$ 1,041
Businesss acquistion goodwill expected period of tax deduction	15 years
Cash acquired	$ 204
Intangible assets acquired	596
Makdad Industrial Supply Co Inc [Member] \| Trade Names and Distribution Rights [Member]
Business Acquisition [Line Items]
Intangible assets acquired	$ 423
Makdad Industrial Supply Co Inc [Member] \| Customer Relationships [Member]
Business Acquisition [Line Items]
Amortization period	18 years
Intangible assets acquired	$ 173
Acme Refrigeration of Baton Rouge LLC [Member]
Business Acquisition [Line Items]
Number of locations in which the company operates \| Location		18
Cash consideration for Business Acquisition		$ 18,051
Fair value of equity shares issued or issuable		$ 2,551		$ 2,551
Stock issued for acquisition \| shares		8,492
Goodwill and intangibles acquired		$ 3,710
Repayment of indebtedness		3,141
Cash acquired		1,340
Intangible assets acquired		2,124
Purchase price less certain average revolving indebtedness		$ 22,855
Number of years goodwill is deductible for tax purposes		15 years
Acme Refrigeration of Baton Rouge LLC [Member] \| Trade Names and Distribution Rights [Member]
Business Acquisition [Line Items]
Intangible assets acquired		$ 1,508
Acme Refrigeration of Baton Rouge LLC [Member] \| Customer Relationships [Member]
Business Acquisition [Line Items]
Intangible assets acquired		$ 616
Amortization period		18 years

Acquisitions - Schedule of Recognized Identified Assets Acquired and Liabilities Assumed (Detail) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021	Apr. 09, 2021
Business Acquisition [Line Items]
Operating lease ROU assets	$ 312,397	$ 268,528
Temperature Equipment Corporation [Member]
Business Acquisition [Line Items]
Accounts receivable			$ 33,315
Inventories			71,325
Other current assets			962
Property and equipment			2,590
Operating lease ROU assets			53,829
Goodwill			18,724
Intangibles			19,900
Accounts payable			(25,393)
Accrued expenses and other current liabilities			(20,509)
Operating lease liabilities, net of current portion			(48,046)
Total			$ 106,697

Derivatives - Impact from Foreign Exchange Derivative Instruments Designated as Cash Flow Hedges (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Derivative Instruments, Gain (Loss) [Line Items]
Gain recorded in accumulated other comprehensive loss	$ 0	$ 0	$ 0	$ 97
Loss reclassified from accumulated other comprehensive loss into earnings	0	0	0	305
Foreign Currency Forward Contracts \| Cash Flow Hedge
Derivative Instruments, Gain (Loss) [Line Items]
Gain recorded in accumulated other comprehensive loss	0	0	0	97
Loss reclassified from accumulated other comprehensive loss into earnings	$ 0	$ 0	$ 0	$ 305

Derivatives - Fair Value of Derivative Instruments and Location in the Balance Sheets (Detail) - Foreign Exchange Forward And Option Contracts [Member] - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Derivatives, Fair Value [Line Items]
Derivative instruments, assets derivatives	$ 0	$ 0
Derivative instruments, liabilities derivatives	13	5
Derivatives Designated as Hedging Instruments [Member]
Derivatives, Fair Value [Line Items]
Derivative instruments, assets derivatives	0	0
Derivative instruments, liabilities derivatives	0	0
Derivatives Not Designated as Hedging Instruments [Member]
Derivatives, Fair Value [Line Items]
Derivative instruments, assets derivatives	0	0
Derivative instruments, liabilities derivatives	$ 13	$ 5

Derivatives - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Foreign Currency Forward Contracts \| Cash Flow Hedge
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Maximum length of time hedged in cash flow hedge			12 months
Foreign Exchange Forward And Option Contracts [Member] \| Not Designated as Hedging Instrument, Economic Hedge [Member]
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Notional value of derivatives	$ 7,500		$ 7,500
Contract expiring terms			2022-10
Gain (loss) from foreign currency forward and option contracts not designated as hedging instruments	$ (149)	$ 83	$ (524)	$ (101)

Fair Value Measurements - Assets and Liabilities Carried at Fair Value Measured on Recurring Basis (Detail) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Other assets
Assets:
Equity securities	$ 596	$ 1,790
Private equities	1,000	1,000
Accrued expenses and other current liabilities
Liabilities:
Derivative financial instruments	13	5
Fair Value Measurements, Level 1 \| Other assets
Assets:
Equity securities	596	1,790
Fair Value Measurements, Level 2 \| Accrued expenses and other current liabilities
Liabilities:
Derivative financial instruments	13	5
Fair Value Measurements, Level 3 \| Other assets
Assets:
Private equities	$ 1,000	$ 1,000

Fair Value Measurements - Additional Information (Detail) $ in Thousands	9 Months Ended
	Sep. 30, 2021 USD ($)
Fair Value Disclosures [Abstract]
Equity Securities, FV-NI, Realized Gain	$ 3,815

Shareholders' Equity - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands		3 Months Ended		9 Months Ended
	Aug. 06, 2021	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Stockholders Equity Note [Line Items]
Shares withheld as payment for tax withholdings related to share based compensation, market value				$ 2,471	$ 894
ATM Program [Member]
Stockholders Equity Note [Line Items]
Maximum aggregate offering amount of stock	$ 300,000
Number of shares sold under atm				0
Class B Common Stock \| Non-Vested Restricted Stock
Stockholders Equity Note [Line Items]
Shares withheld as payment for tax withholdings related to share based compensation, shares		879	3,250	9,060	3,250
Shares withheld as payment for tax withholdings related to share based compensation, market value		$ 252	$ 894	$ 2,431	$ 894
Common and Class B Common Stock
Stockholders Equity Note [Line Items]
Cash dividends paid per share of Common and Class B common stock		$ 2.2	$ 1.95	$ 6.35	$ 5.675
Common Stock \| Stock Option
Stockholders Equity Note [Line Items]
Net proceeds from the sale of Common stock		$ 7,929	$ 2,094	$ 15,151	$ 9,940
Shares withheld as payment for tax withholdings related to share based compensation, shares		1,053		1,053	2,965
Shares withheld as payment for tax withholdings related to share based compensation, market value		$ 298		$ 298	$ 863
Common Stock \| Employee Stock Purchase Plan [Member]
Stockholders Equity Note [Line Items]
Net proceeds from shares purchased under ESPP		$ 478	$ 392	$ 1,484	$ 1,233

Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Commitments and Contingencies Disclosure [Line Items]
Self-insurance reserves	$ 10,715	$ 7,253

Related Party Transactions - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Greenberg Traurig, P.A.
Related Party Transaction [Line Items]
Amount payable to related party	$ 37		$ 37		$ 34
Greenberg Traurig, P.A. \| Customary Fees for Legal Services
Related Party Transaction [Line Items]
Fees for related party transaction	40	$ 83	169	$ 181
Carrier and Its Affiliates \| Supplier Concentration Risk
Related Party Transaction [Line Items]
Amount payable to Carrier and its affiliates, net of receivables	167,000		167,000		$ 90,000
Revenues from sales to Carrier and its affiliates	$ 26,000	$ 30,000	$ 76,000	$ 86,000
Carrier and Its Affiliates \| Supplier Concentration Risk \| Cost of Goods, Total
Related Party Transaction [Line Items]
Percentage of purchases from key suppliers	63.00%	59.00%	60.00%	64.00%

Subsequent Events - Additional Information (Detail) - USD ($) $ in Thousands			3 Months Ended		9 Months Ended
	Oct. 18, 2022	Oct. 15, 2022	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Subsequent Event [Line Items]
Payment, tax withholding, share-based payment arrangement					$ 2,471	$ 894
Subsequent Event
Subsequent Event [Line Items]
Cash dividend, common stock and Class B common stock current rate	2.45
Cash dividend, common stock and Class B common stock previous rate	2.2
Effective date of increase in quarterly cash dividend rate	2023-01
Class B Common Stock \| Restricted Stock [Member]
Subsequent Event [Line Items]
Payment, tax withholding, share-based payment arrangement			$ 252	$ 894	$ 2,431	$ 894
Share based payment arrangement, shares withheld for tax withholding obligation			879	3,250	9,060	3,250
Class B Common Stock \| Subsequent Event \| Restricted Stock [Member] \| Affiliate of Chief Executive Officer [Member]
Subsequent Event [Line Items]
Number of shares vested		975,622
Payment, tax withholding, share-based payment arrangement		$ 104,319
Share based payment arrangement, shares withheld for tax withholding obligation		311,408
Market value of vested shares		$ 265,106
Cash payment related to tax withholding for share based compensation		$ 19,700
Shares retained net of tax withholdings		664,214