11. SEGMENTS Operating segments for the Company are determined based on information used by the chief operating decision maker (CODM) in deciding how to evaluate performance and allocate resources to each of the segments. The CODM reviews Adjusted EBITDA and Adjusted EBITDA Margin as the key segment measures of performance. Adjusted EBITDA is defined as segment operating income (loss) plus depreciation and amortization, adjusted by adding thereto or subtracting therefrom stock-based compensation costs, business transformation costs, acquisition costs, capital structure transaction costs, and certain other costs. Adjusted EBITDA Margin is defined as Adjusted EBITDA divided by net sales. The Company has two reportable segments, Residential and Commercial. The reportable segments were determined primarily based on products and end markets as follows:  ResidentialThe Residential segment manufactures and distributes decking, rail, trim and accessories through a national network of dealers and distributors and multiple home improvement retailers providing extensive geographic coverage and enabling the Company to effectively serve contractors. The additions of Ultralox and Versatex are complementary to the Residential segment railing and trim businesses, respectively. The recent addition of Return Polymers provides a full-service recycled PVC material processing, sourcing, logistical support, and scrap management programs. This segment is impacted by trends in and the strength of home repair and remodel activity.  CommercialThe Commercial segment manufactures, fabricates and distributes resin based extruded sheeting products for a variety of commercial and industrial applications through a widespread distribution network as well as directly to original equipment manufacturers. This segment includes Scranton Products which manufactures lockers and partitions and Vycom which manufactures resin based sheeting products. This segment is impacted by trends in and the strength of the new construction sector. The segment data below includes data for Residential and Commercial for the nine months ended June 30, 2020 and 2019 (in thousands). Nine Months Ended June 30, 2020 2019 Net sales to customers Residential $ 538,514 $ 476,441 Commercial 96,825 102,228 Total $ 635,339 $ 578,669 Adjusted EBITDA Residential $ 164,047 $ 134,818 Commercial 11,179 14,376 Total Adjusted EBITDA for reporting segments $ 175,226 $ 149,194 Unallocated net expenses (27,782 ) (22,128 ) Adjustments to Income (loss) before income tax provision Depreciation and amortization (75,225 ) (69,634 ) Stock-based compensation costs (20,169 ) (2,600 ) Business transformation costs (1) (435 ) (12,608 ) Acquisition costs (2) (1,538 ) (3,656 ) Initial public offering costs (6,716 ) (6,155 ) Other costs (3) (3,015 ) 6,693 Capital structure transaction costs (4) (37,538 )  Interest expense (64,882 ) (63,213 ) Income (loss) before income tax provision $ (62,074 ) $ (24,107 ) (1) Business transformation costs reflect consulting and other costs related to repositioning of brands of $0.0 million and $3.9 million for the nine months ended June 30, 2020 and 2019, respectively, compensation costs related to the transformation of the senior management team of $0.4 million and $1.9 million for the nine months ended June 30, 2020 and 2019, respectively, costs related to the relocation of the Companys corporate headquarters of $0.0 million and $1.8 million for the nine months ended June 30, 2020 and 2019, respectively, startup costs of the Companys new recycling facility of $0.0 million and $2.9 million for the nine months ended June 30, 2020 and 2019, respectively, and other integration-related costs of $0.0 million and $2.1 million for the nine months ended June 30, 2020 and 2019, respectively. (2) Acquisition costs reflect costs directly related to completed acquisitions $0.9 million and $3.7 million for the nine months ended June 30, 2020 and 2019, respectively, and inventory step-up adjustments related to recording the inventory of acquired businesses at fair value on the date of acquisition of $0.6 million and $0.0 million for the nine months ended June 30, 2020 and 2019, respectively. (3) Other costs include costs for legal expenses of $0.4 million and $0.8 million for the nine months ended June 30, 2020 and 2019, respectively, reduction in workforce costs of $0.4 million for the nine months ended June 30, 2020, income from an insurance recovery of legal loss of $0.0 million and $7.7 million for the nine months ended June 30, 2020 and 2019, respectively, and costs related to an incentive plan associated with the IPO of $2.2 million and $0.2 million for the nine months ended June 30, 2020 and 2019, respectively. (4) Capital structure transaction costs include loss on extinguishment of debt of $1.9 million for the 2021 Senior Notes and $35.6 million for the 2025 Senior Notes for the nine months ended June 30, 2020.