BUSINESS SEGMENTS

9 Months Ended

May 31, 2019

NOTE 17. BUSINESS SEGMENTS

The Company's operating segments earn revenues and incur expenses for which discrete financial information is available. Operating results for the operating segments are regularly reviewed by the Company's chief operating decision maker to make decisions about resources to be allocated to the segments and to assess performance. The Company's chief operating decision maker is identified as the Chief Executive Officer. Operating segments are aggregated for reporting purposes when the operating segments are identified as similar in accordance with the basic principles and aggregation criteria in the accounting standards. The Company's reporting segments are based primarily on product lines and secondarily on geographic area. The reporting 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 four reporting segments: Americas Recycling, Americas Mills, Americas Fabrication, and International Mill. See Note 1, Nature of Operations, of the consolidated financial statements included in the 2018 Form 10-K for more information about the reporting segments, including the types of products and services from which each reporting segment derives its net sales. Corporate and Other contains earnings or losses on assets and liabilities related to the Company's Benefit Restoration Plan assets and short-term investments, expenses of the Company's corporate headquarters, interest expense related to its long-term debt and intercompany eliminations.

The Company uses adjusted EBITDA from continuing operations to compare and evaluate the financial performance of its segments. Adjusted EBITDA is the sum of the Company's earnings from continuing operations before interest expense, income taxes, depreciation and amortization, and impairment expense. Intersegment sales are generally priced at prevailing market prices. Certain corporate administrative expenses are allocated to the 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 consolidated financial statements included in the 2018 Form 10-K.

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



	Three Months Ended May 31, 2019
(in thousands)	Americas Recycling		Americas Mills		Americas Fabrication			International Mill		Corporate and Other			Continuing Operations
Net sales-unaffiliated customers	$	228,786	$	536,035	$	629,510		$	209,022	$	2,519		$	1,605,872
Intersegment sales	60,229		330,868		3,537			343		(394,977		)	—
Net sales	289,015		866,903		633,047			209,365		(392,458		)	1,605,872
Adjusted EBITDA	12,331		158,114		(23,289		)	24,120		(27,305		)	143,971



	Nine Months Ended May 31, 2019
(in thousands)	Americas Recycling		Americas Mills		Americas Fabrication			International Mill		Corporate and Other			Continuing Operations
Net sales-unaffiliated customers	$	694,855	$	1,382,501	$	1,590,746		$	610,640	$	7,255		$	4,285,997
Intersegment sales	183,244		860,964		10,248			947		(1,055,403		)	—
Net sales	878,099		2,243,465		1,600,994			611,587		(1,048,148		)	4,285,997
Adjusted EBITDA	37,889		384,383		(109,863		)	77,436		(111,005		)	278,840
Total assets as of May 31, 2019 ⁽¹⁾	262,620		1,682,255		1,136,996			501,079		184,060			3,767,010

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(1) Total assets listed in Corporate and Other includes assets from discontinued operations.



	Three Months Ended May 31, 2018
(in thousands)	Americas Recycling		Americas Mills		Americas Fabrication			International Mill		Corporate and Other			Continuing Operations
Net sales-unaffiliated customers	$	292,679	$	332,459	$	375,183		$	201,438	$	2,725		$	1,204,484
Intersegment sales	71,419		220,604		3,058			299		(295,380		)	—
Net sales	364,098		553,063		378,241			201,737		(292,655		)	1,204,484
Adjusted EBITDA	19,477		89,590		(8,208		)	31,987		(31,814		)	101,032



	Nine Months Ended May 31, 2018
(in thousands)	Americas Recycling		Americas Mills		Americas Fabrication			International Mill		Corporate and Other			Continuing Operations
Net sales-unaffiliated customers	$	832,448	$	841,895	$	1,015,934		$	633,134	$	11,874		$	3,335,285
Intersegment sales	171,618		550,573		8,059			846		(731,096		)	—
Net sales	1,004,066		1,392,468		1,023,993			633,980		(719,222		)	3,335,285
Adjusted EBITDA	51,698		194,975		(14,787		)	95,066		(81,777		)	245,175
Total assets as of August 31, 2018 ⁽¹⁾	291,838		1,115,339		739,151			485,548		696,428			3,328,304

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(1) Total assets listed in Corporate and Other includes assets from discontinued operations.

The following table presents a reconciliation of earnings from continuing operations to adjusted EBITDA from continuing operations:



	Three Months Ended May 31,					Nine Months Ended May 31,
(in thousands)	2019			2018		2019			2018
Earnings from continuing operations	$	78,551		$	42,325	$	112,899		$	83,977
Interest expense	18,513			11,511		53,671			25,303
Income taxes	29,105			13,312		52,855			23,465
Depreciation and amortization	41,181			32,949		117,602			98,898
Amortization of acquired unfavorable contract backlog	(23,394		)	—		(58,202		)	—
Impairment of assets	15			935		15			13,532
Adjusted EBITDA from continuing operations	$	143,971		$	101,032	$	278,840		$	245,175