Business Segments

6 Months Ended

Feb. 28, 2014

Segment Reporting [Abstract]

Business segments

NOTE 14. BUSINESS SEGMENTS

The Company's reporting segments are based on strategic business areas, which offer different products and services. These segments have different lines of management responsibility as each business requires different marketing strategies and management expertise.

The Company structures its business into the following five segments: Americas Recycling, Americas Mills, Americas Fabrication, International Mill and International Marketing and Distribution. The Americas Recycling segment processes scrap metals for use as a raw material by manufacturers of new metal products. The Americas Mills segment manufactures finished long steel products including reinforcement bar ("rebar"), merchant bar, light structural, some special bar quality (SBQ) and other special sections as well as semi-finished billets for re-rolling and forging applications. The Americas Fabrication segment consists of the Company's rebar and structural fabrication operations, fence post manufacturing plants, construction-related product facilities and plants that heat-treat steel to strengthen and provide flexibility. The International Mill segment includes the Company's minimill and the Company's recycling and fabrication operations in Poland. The International Marketing and Distribution segment includes international operations for the sale, distribution and processing of steel products, ferrous and nonferrous metals and other industrial products. Additionally, this segment includes the Company's U.S.-based marketing and distribution divisions and also operates a recycling facility in Singapore. Corporate contains expenses of the Company's corporate headquarters and interest expense related to its long-term public debt.

The financial information presented for the International Mill segment excludes CMCS operations. Additionally, the financial information presented for the Americas Mills segment excludes Howell. These operations have been classified as discontinued operations in the consolidated statements of operations. See Note 6, Businesses Held for Sale, Discontinued Operations and Dispositions, for more information.

The Company uses adjusted operating profit (loss), a non-GAAP financial measure, to compare and to evaluate the financial performance of its segments. Adjusted operating profit (loss) is the sum of our earnings (loss) from continuing operations before income taxes, interest expense and discounts on sales of accounts receivable. Intersegment sales are generally priced at prevailing market prices. Certain corporate administrative expenses are allocated to segments based upon the nature of the expense. The accounting policies of the segments are the same as those described in Note 2, Summary of Significant Accounting Policies, of the audited consolidated financial statements included in the Annual Report on Form 10-K for the fiscal year ended August 31, 2013.

The following is a summary of certain financial information from continuing operations by reportable segment:

	Three Months Ended February 28, 2014
	Americas								International
(in thousands)	Recycling			Mills		Fabrication			Mill			Marketing and Distribution		Corporate			Eliminations			Continuing Operations
Net sales-unaffiliated customers	$	293,146		$	277,562	$	322,572		$	181,245		$	569,407	$	5,166		$	—		$	1,649,098
Intersegment sales	49,121			179,287		3,318			117			2,401		—			(234,244		)	—
Net sales	342,267			456,849		325,890			181,362			571,808		5,166			(234,244		)	1,649,098
Adjusted operating profit (loss)	(863		)	44,062		(5,330		)	8,331			2,493		(15,064		)	1,422			35,051
	Three Months Ended February 28, 2013
	Americas								International
(in thousands)	Recycling			Mills		Fabrication			Mill			Marketing and Distribution		Corporate			Eliminations			Continuing Operations
Net sales-unaffiliated customers	$	301,035		$	244,285	$	314,389		$	179,842		$	645,445	$	3,661		$	—		$	1,688,657
Intersegment sales	50,339			191,292		3,577			(77		)	4,491		—			(249,622		)	—
Net sales	351,374			435,577		317,966			179,765			649,936		3,661			(249,622		)	1,688,657
Adjusted operating profit (loss)	2,243			47,685		(3,812		)	(4,153		)	3,948		(19,194		)	(1,083		)	25,634
	Six Months Ended February 28, 2014
	Americas								International
(in thousands)	Recycling			Mills		Fabrication			Mill			Marketing and Distribution		Corporate			Eliminations			Continuing Operations
Net sales-unaffiliated customers	$	586,622		$	569,135	$	676,564		$	409,737		$	1,078,580	$	11,351		$	—		$	3,331,989
Intersegment sales	93,848			368,865		7,544			775			4,385		—			(475,417		)	—
Net sales	680,470			938,000		684,108			410,512			1,082,965		11,351			(475,417		)	3,331,989
Adjusted operating profit (loss)	(24		)	109,876		(3,113		)	23,600			2,996		(33,113		)	2,018			102,240
Total assets*	271,047			598,171		590,410			563,579			903,444		1,022,523			(413,383		)	3,535,791
	Six Months Ended February 28, 2013
	Americas								International
(in thousands)	Recycling			Mills		Fabrication			Mill			Marketing and Distribution		Corporate			Eliminations			Continuing Operations
Net sales-unaffiliated customers	$	608,506		$	511,390	$	667,136		$	395,700		$	1,248,980	$	6,460		$	—		$	3,438,172
Intersegment sales	94,829			380,925		7,422			6,132			9,544		—			(498,852		)	—
Net sales	703,335			892,315		674,558			401,832			1,258,524		6,460			(498,852		)	3,438,172
Adjusted operating profit (loss)	6,737			99,346		6,380			(3,277		)	44,109		(36,564		)	(1,744		)	114,987
Total assets at August 31, 2013*	309,599			598,478		631,510			487,613			838,413		1,075,594			(496,946		)	3,444,261

* Excludes total assets from discontinued operations of $8.7 million at February 28, 2014 and $50.5 million at August 31, 2013.

Reconciliations of earnings from continuing operations to adjusted operating profit are provided below:

	Three Months Ended February 28,				Six Months Ended February 28,
(in thousands)	2014		2013		2014		2013
Earnings from continuing operations	$	11,059	$	3,933	$	43,020	$	52,864
Income taxes	3,866		4,308		18,957		26,497
Interest expense	19,179		16,490		38,757		33,514
Discounts on sales of accounts receivable	947		903		1,506		2,112
Adjusted operating profit	$	35,051	$	25,634	$	102,240	$	114,987