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Segment Information
3 Months Ended
Aug. 31, 2018
Segment Reporting [Abstract]  
Segment Information

NOTE 17 — SEGMENT INFORMATION

During the quarter ended August 31, 2018, we made the determination to streamline certain businesses and management structures within our industrial reportable segment.  As a result, our former tremco illbruck Group, Tremco Group and several components from our Performance Coatings Group, including our Euclid and Flowcrete businesses, were combined to form a new Construction Products Group.  There were no changes in the composition of any of our reportable segments, and therefore, previously reported business segment information remains unchanged. We operate a portfolio of businesses and product lines that manufacture and sell a variety of specialty paints, protective coatings and roofing systems, sealants and adhesives. We manage our portfolio by organizing our businesses and product lines into three reportable segments: the industrial reportable segment, the consumer reportable segment and the specialty reportable segment. Within each reportable segment, we aggregate operating segments or product lines that consist of individual companies or groups of companies and product lines, which generally address common markets, share similar economic characteristics, utilize similar technologies and can share manufacturing or distribution capabilities. Our six operating segments represent components of our business for which separate financial information is available that is utilized on a regular basis by our chief operating decision maker in determining how to allocate the assets of the company and evaluate performance. These six operating segments are each managed by an operating segment manager, who is responsible for the day-to-day operating decisions and performance evaluation of the operating segment’s underlying businesses.

Our industrial reportable segment products are sold throughout North America and also account for the majority of our international sales. Our industrial product lines are sold directly to contractors, distributors and end-users, such as industrial manufacturing facilities, public institutions and other commercial customers. The industrial reportable segment comprises two separate operating segments — Construction Products Group and Performance Coatings Group. Products and services within this reportable segment include construction chemicals, roofing systems, weatherproofing and other sealants, and polymer flooring.

Our consumer reportable segment manufactures and markets professional use and do-it-yourself (“DIY”) products for a variety of mainly consumer applications, including home improvement and personal leisure activities. Our consumer segment’s major manufacturing and distribution operations are located primarily in North America, along with a few locations in Europe and other parts of the world. Our consumer reportable segment products are primarily sold directly to mass merchandisers, home improvement centers, hardware stores, paint stores, craft shops, cosmetic companies and through distributors. This reportable segment comprises three operating segments — Rust-Oleum Group, DAP Group and SPG-Consumer Group. Products within this reportable segment include specialty, hobby and professional paints; nail enamels; caulks; adhesives; silicone sealants and wood stains.

Our specialty reportable segment products are sold throughout North America and a few international locations, primarily in Europe. Our specialty product lines are sold directly to contractors, distributors and end-users, such as industrial manufacturing facilities, public institutions and other commercial customers. The specialty reportable segment is a single operating segment, which offers products that include industrial cleaners, restoration services equipment, colorants, exterior finishes, edible coatings and specialty glazes for pharmaceutical and food industries, and other specialty OEM coatings.

In addition to our three reportable segments, there is a category of certain business activities and expenses, referred to as corporate/other, that does not constitute an operating segment. This category includes our corporate headquarters and related administrative expenses, results of our captive insurance companies, gains or losses on the sales of certain assets and other expenses not directly associated with any reportable segment. Assets related to the corporate/other category consist primarily of investments, prepaid expenses and headquarters’ property and equipment. These corporate and other assets and expenses reconcile reportable segment data to total consolidated income before income taxes and identifiable assets.

We reflect income from our joint ventures on the equity method, and receive royalties from our licensees.

The following tables present a disaggregation of revenues by geography, and reflect the results of our reportable segments consistent with our management philosophy, by representing the information we utilize, in conjunction with various strategic, operational and other financial performance criteria, in evaluating the performance of our portfolio of businesses.  

 

Three Months Ended August 31, 2018

 

Industrial Segment

 

 

Consumer Segment

 

 

Specialty Segment

 

 

Consolidated

 

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Sales (based on shipping location)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

United States

 

$

442,621

 

 

$

381,668

 

 

$

156,384

 

 

$

980,673

 

Foreign

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Canada

 

 

61,009

 

 

 

29,006

 

 

 

6,762

 

 

 

96,777

 

Europe

 

 

183,114

 

 

 

59,577

 

 

 

23,886

 

 

 

266,577

 

Latin America

 

 

47,627

 

 

 

6,122

 

 

 

307

 

 

 

54,056

 

Asia Pacific

 

 

30,502

 

 

 

6,912

 

 

 

5,481

 

 

 

42,895

 

Other Foreign

 

 

17,100

 

 

 

1,911

 

 

 

-

 

 

 

19,011

 

Total Foreign

 

 

339,352

 

 

 

103,528

 

 

 

36,436

 

 

 

479,316

 

Total

 

$

781,973

 

 

$

485,196

 

 

$

192,820

 

 

$

1,459,989

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended August 31, 2017

 

Industrial Segment

 

 

Consumer Segment

 

 

Specialty Segment

 

 

Consolidated

 

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Sales (based on shipping location)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

United States

 

$

399,287

 

 

$

324,650

 

 

$

150,423

 

 

$

874,360

 

Foreign

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Canada

 

 

62,834

 

 

 

26,577

 

 

 

7,056

 

 

 

96,467

 

Europe

 

 

179,083

 

 

 

60,456

 

 

 

25,039

 

 

 

264,578

 

Latin America

 

 

45,524

 

 

 

5,693

 

 

 

465

 

 

 

51,682

 

Asia Pacific

 

 

26,667

 

 

 

7,872

 

 

 

5,499

 

 

 

40,038

 

Other Foreign

 

 

16,373

 

 

 

1,896

 

 

 

-

 

 

 

18,269

 

Total Foreign

 

 

330,481

 

 

 

102,494

 

 

 

38,059

 

 

 

471,034

 

Total

 

$

729,768

 

 

$

427,144

 

 

$

188,482

 

 

$

1,345,394

 

 

 

 

Three Months Ended

 

 

 

August 31,

 

 

August 31,

 

 

 

2018

 

 

2017

 

 

 

(In thousands)

 

Income (Loss) Before Income Taxes

 

 

 

 

 

 

 

 

Industrial Segment

 

$

69,057

 

 

$

88,902

 

Consumer Segment

 

 

51,296

 

 

 

72,368

 

Specialty Segment

 

 

27,801

 

 

 

33,167

 

Corporate/Other

 

 

(56,216

)

 

 

(39,153

)

Consolidated

 

$

91,938

 

 

$

155,284