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Important Note Regarding Forward-Looking Statements

The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements made by us or on our behalf. Certain statements contained herein do not relate strictly to historical or current facts and may contain forward-looking statements that reflect our current views with respect to future events and financial performance. As such, they are considered "forward-looking statements" which provide current expectations or forecasts of future events. Such statements can be identified by the use of terminology such as "may," "could," "will," "should," "possible," "plan," "predict," "forecast," "potential," "anticipate," "estimate," "expect," "project," "intend," "believe," "may impact," "on track," and similar words or expressions. Our forward-looking statements generally relate to our growth strategies, financial results, product development, sales efforts, and, specific to the above, potential financial and supply chain impacts from coronavirus. These forward-looking statements should be considered with the understanding that such statements involve a variety of risks and uncertainties, known and unknown, and may be affected by inaccurate assumptions. Consequently, no forward-looking statement can be guaranteed and actual results may vary materially.

We undertake no obligation to update any forward-looking statement, and investors are advised to review disclosures in our filings with the SEC. It is not possible to foresee or identify all factors that could cause actual results to differ from expected or historic results. Therefore, investors should not consider the foregoing factors to be an exhaustive statement of all risks, uncertainties, or factors that could potentially cause actual results to differ from forward-looking statements.

Except as otherwise noted, each answer above speaks only as of the date of our most recent quarterly earnings materials. We do not intend to update, and undertake no obligation to update, such answers, until the date of our next quarterly earnings materials.

QUESTIONS

Why did the Company’s North America business change its accounting methodology from LIFO to FIFO?

Effective January 1, 2021, the Company changed its accounting principle for inventory valuation for inventories located in the U.S. from a last-in, first-out ("LIFO") basis to a first-in, first-out ("FIFO") basis.

We believe this change in accounting principle is preferable as it:

  1. is consistent with how we internally manage our business
  2. results in a more consistent method to value our inventory across regions
  3. provides better comparability with our peers
  4. the FIFO method better reflects our current cost of inventory.
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What is the expected impact of the LIFO to FIFO change on 2021 results?

In Q1 2021, the change from LIFO to FIFO increased EBIT by $3M and earnings per diluted share by 0.03.

Consistent with Q1 2021 results, we expect the impact on our full-year 2021 results to be immaterial.

For additional information on the impact of the LIFO to FIFO change on past periods (2018 - 2020), please refer to our quarterly report on Form 10-Q for quarter ended March 31, 2021, our Form 8-K filed on April 22, 2021, and the ‘Recast Historical Financial Data’ page in the ‘Financial Information’ section of the IR website.

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