(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification Number) |
Title of Each Class | Trading Symbol(s) | Name of Each Exchange on Which Registered | ||||||||||||
☒ | Accelerated filer | ☐ | |||||||||
Non-accelerated filer | ☐ | Smaller reporting company | |||||||||
Emerging growth company |
COMMERCIAL METALS COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED) | ||||||||||||||||||||||||||
Three Months Ended May 31, | Nine Months Ended May 31, | |||||||||||||||||||||||||
(in thousands, except share and per share data) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
Net sales | $ | $ | $ | $ | ||||||||||||||||||||||
Costs and operating expenses: | ||||||||||||||||||||||||||
Cost of goods sold | ||||||||||||||||||||||||||
Selling, general and administrative expenses | ||||||||||||||||||||||||||
Interest expense | ||||||||||||||||||||||||||
Net costs and operating expenses | ||||||||||||||||||||||||||
Earnings before income taxes | ||||||||||||||||||||||||||
Income taxes | ||||||||||||||||||||||||||
Net earnings | $ | $ | $ | $ | ||||||||||||||||||||||
Earnings per share: | ||||||||||||||||||||||||||
Basic | $ | $ | $ | $ | ||||||||||||||||||||||
Diluted | ||||||||||||||||||||||||||
Average basic shares outstanding | ||||||||||||||||||||||||||
Average diluted shares outstanding |
COMMERCIAL METALS COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) | ||||||||||||||||||||||||||
Three Months Ended May 31, | Nine Months Ended May 31, | |||||||||||||||||||||||||
(in thousands) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
Net earnings | $ | $ | $ | $ | ||||||||||||||||||||||
Other comprehensive income (loss), net of income taxes: | ||||||||||||||||||||||||||
Foreign currency translation adjustments | ||||||||||||||||||||||||||
Derivatives: | ||||||||||||||||||||||||||
Net unrealized holding gain (loss) | ( | ( | ( | |||||||||||||||||||||||
Reclassification for realized (gain) loss | ( | ( | ( | |||||||||||||||||||||||
Net unrealized gain (loss) on derivatives | ( | ( | ( | |||||||||||||||||||||||
Defined benefit plans gain (loss) after amortization of prior service costs | ( | ( | ( | |||||||||||||||||||||||
Total other comprehensive income (loss), net of income taxes | ( | ( | ||||||||||||||||||||||||
Comprehensive income | $ | $ | $ | $ |
COMMERCIAL METALS COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) | ||||||||||||||
(in thousands, except share and per share data) | May 31, 2024 | August 31, 2023 | ||||||||||||
Assets | ||||||||||||||
Current assets: | ||||||||||||||
Cash and cash equivalents | $ | $ | ||||||||||||
Accounts receivable (less allowance for doubtful accounts of $ | ||||||||||||||
Inventories, net | ||||||||||||||
Prepaid and other current assets | ||||||||||||||
Total current assets | ||||||||||||||
Property, plant and equipment, net | ||||||||||||||
Intangible assets, net | ||||||||||||||
Goodwill | ||||||||||||||
Other noncurrent assets | ||||||||||||||
Total assets | $ | $ | ||||||||||||
Liabilities and stockholders' equity | ||||||||||||||
Current liabilities: | ||||||||||||||
Accounts payable | $ | $ | ||||||||||||
Accrued expenses and other payables | ||||||||||||||
Current maturities of long-term debt and short-term borrowings | ||||||||||||||
Total current liabilities | ||||||||||||||
Deferred income taxes | ||||||||||||||
Other noncurrent liabilities | ||||||||||||||
Long-term debt | ||||||||||||||
Total liabilities | ||||||||||||||
Commitments and contingencies (Note 12) | ||||||||||||||
Stockholders' equity: | ||||||||||||||
Common stock, par value $ | ||||||||||||||
Additional paid-in capital | ||||||||||||||
Accumulated other comprehensive loss | ( | ( | ||||||||||||
Retained earnings | ||||||||||||||
Less treasury stock | ( | ( | ||||||||||||
Stockholders' equity | ||||||||||||||
Stockholders' equity attributable to non-controlling interests | ||||||||||||||
Total stockholders' equity | ||||||||||||||
Total liabilities and stockholders' equity | $ | $ |
COMMERCIAL METALS COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) | ||||||||||||||
Nine Months Ended May 31, | ||||||||||||||
(in thousands) | 2024 | 2023 | ||||||||||||
Cash flows from (used by) operating activities: | ||||||||||||||
Net earnings | $ | $ | ||||||||||||
Adjustments to reconcile net earnings to cash flows from operating activities: | ||||||||||||||
Depreciation and amortization | ||||||||||||||
Stock-based compensation | ||||||||||||||
Write-down of inventory | ||||||||||||||
Deferred income taxes and other long-term taxes | ( | |||||||||||||
Other | ||||||||||||||
Settlement of New Markets Tax Credit transaction | ( | |||||||||||||
Changes in operating assets and liabilities, net of acquisitions | ( | |||||||||||||
Net cash flows from operating activities | ||||||||||||||
Cash flows from (used by) investing activities: | ||||||||||||||
Capital expenditures | ( | ( | ||||||||||||
Acquisitions, net of cash acquired | ( | |||||||||||||
Other | ||||||||||||||
Net cash flows used by investing activities | ( | ( | ||||||||||||
Cash flows from (used by) financing activities: | ||||||||||||||
Repayments of long-term debt | ( | ( | ||||||||||||
Debt issuance and extinguishment | ( | |||||||||||||
Proceeds from accounts receivable facilities | ||||||||||||||
Repayments under accounts receivable facilities | ( | ( | ||||||||||||
Treasury stock acquired | ( | ( | ||||||||||||
Tax withholdings related to share settlements, net of purchase plans | ( | ( | ||||||||||||
Dividends | ( | ( | ||||||||||||
Contribution from non-controlling interest | ||||||||||||||
Net cash flows used by financing activities | ( | ( | ||||||||||||
Effect of exchange rate changes on cash | ||||||||||||||
Increase (decrease) in cash, restricted cash and cash equivalents | ( | |||||||||||||
Cash, restricted cash and cash equivalents at beginning of period | ||||||||||||||
Cash, restricted cash and cash equivalents at end of period | $ | $ |
Supplemental information: | Nine Months Ended May 31, | |||||||||||||
(in thousands) | 2024 | 2023 | ||||||||||||
Cash paid for income taxes | $ | $ | ||||||||||||
Cash paid for interest | ||||||||||||||
Noncash activities: | ||||||||||||||
Liabilities related to additions of property, plant and equipment | $ | $ | ||||||||||||
Right of use assets obtained in exchange for operating leases | ||||||||||||||
Right of use assets obtained in exchange for finance leases | ||||||||||||||
Cash and cash equivalents | $ | $ | ||||||||||||
Restricted cash | ||||||||||||||
Total cash, restricted cash and cash equivalents | $ | $ |
COMMERCIAL METALS COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (UNAUDITED) | |||||||||||||||||||||||||||||
Three Months Ended May 31, 2024 | |||||||||||||||||||||||||||||
Common Stock | Treasury Stock | ||||||||||||||||||||||||||||
(in thousands, except share and per share data) | Number of Shares | Amount | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Number of Shares | Amount | Non-controlling Interest | Total | ||||||||||||||||||||
Balance, March 1, 2024 | $ | $ | $ | ( | $ | ( | $ | ( | $ | $ | |||||||||||||||||||
Net earnings | |||||||||||||||||||||||||||||
Other comprehensive loss | ( | ( | |||||||||||||||||||||||||||
Dividends ($ | ( | ( | |||||||||||||||||||||||||||
Treasury stock acquired and excise tax | ( | ( | ( | ||||||||||||||||||||||||||
Issuance of stock under incentive and purchase plans, net of shares withheld for taxes and other | |||||||||||||||||||||||||||||
Stock-based compensation | |||||||||||||||||||||||||||||
Contribution of non-controlling interest | |||||||||||||||||||||||||||||
Balance, May 31, 2024 | $ | $ | $ | ( | $ | ( | $ | ( | $ | $ | |||||||||||||||||||
Nine Months Ended May 31, 2024 | |||||||||||||||||||||||||||||
Common Stock | Treasury Stock | ||||||||||||||||||||||||||||
(in thousands, except share and per share data) | Number of Shares | Amount | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Number of Shares | Amount | Non-controlling Interest | Total | ||||||||||||||||||||
Balance, September 1, 2023 | $ | $ | $ | ( | $ | ( | $ | ( | $ | $ | |||||||||||||||||||
Net earnings | |||||||||||||||||||||||||||||
Other comprehensive loss | ( | ( | |||||||||||||||||||||||||||
Dividends ($ | ( | ( | |||||||||||||||||||||||||||
Treasury stock acquired and excise tax | ( | ( | ( | ||||||||||||||||||||||||||
Issuance of stock under incentive and purchase plans, net of shares withheld for taxes and other | ( | ( | |||||||||||||||||||||||||||
Stock-based compensation | |||||||||||||||||||||||||||||
Contribution of non-controlling interest | |||||||||||||||||||||||||||||
Reclassification of share-based liability awards | |||||||||||||||||||||||||||||
Balance, May 31, 2024 | $ | $ | $ | ( | $ | ( | $ | ( | $ | $ |
Three Months Ended May 31, 2023 | |||||||||||||||||||||||||||||
Common Stock | Treasury Stock | ||||||||||||||||||||||||||||
(in thousands, except share and per share data) | Number of Shares | Amount | Additional Paid-In Capital | Accumulated Other Comprehensive Income | Retained Earnings | Number of Shares | Amount | Non-controlling Interest | Total | ||||||||||||||||||||
Balance, March 1, 2023 | $ | $ | $ | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||
Net earnings | |||||||||||||||||||||||||||||
Other comprehensive income | |||||||||||||||||||||||||||||
Dividends ($ | ( | ( | |||||||||||||||||||||||||||
Treasury stock acquired | ( | ( | ( | ||||||||||||||||||||||||||
Issuance of stock under incentive and purchase plans, net of shares withheld for taxes | |||||||||||||||||||||||||||||
Stock-based compensation | |||||||||||||||||||||||||||||
Contribution of non-controlling interest | |||||||||||||||||||||||||||||
Balance, May 31, 2023 | $ | $ | $ | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||
Nine Months Ended May 31, 2023 | |||||||||||||||||||||||||||||
Common Stock | Treasury Stock | ||||||||||||||||||||||||||||
(in thousands, except share and per share data) | Number of Shares | Amount | Additional Paid-In Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings | Number of Shares | Amount | Non-controlling Interest | Total | ||||||||||||||||||||
Balance, September 1, 2022 | $ | $ | $ | ( | $ | ( | $ | ( | $ | $ | |||||||||||||||||||
Net earnings | |||||||||||||||||||||||||||||
Other comprehensive income | |||||||||||||||||||||||||||||
Dividends ($ | ( | ( | |||||||||||||||||||||||||||
Treasury stock acquired | ( | ( | ( | ||||||||||||||||||||||||||
Issuance of stock under incentive and purchase plans, net of shares withheld for taxes | ( | ( | |||||||||||||||||||||||||||
Stock-based compensation | |||||||||||||||||||||||||||||
Contribution of non-controlling interest | |||||||||||||||||||||||||||||
Reclassification of share-based liability awards | |||||||||||||||||||||||||||||
Balance, May 31, 2023 | $ | $ | $ | $ | ( | $ | ( | $ | $ |
Three Months Ended May 31, 2024 | ||||||||||||||||||||||||||
(in thousands) | Foreign Currency Translation | Derivatives | Defined Benefit Pension Plans | Total AOCI | ||||||||||||||||||||||
Balance, March 1, 2024 | $ | ( | $ | $ | ( | $ | ( | |||||||||||||||||||
Other comprehensive income (loss) before reclassifications(1) | ( | ( | ( | |||||||||||||||||||||||
Reclassification for loss(2) | ||||||||||||||||||||||||||
Net other comprehensive income (loss) | ( | ( | ( | |||||||||||||||||||||||
Balance, May 31, 2024 | $ | ( | $ | $ | ( | $ | ( | |||||||||||||||||||
Nine Months Ended May 31, 2024 | ||||||||||||||||||||||||||
(in thousands) | Foreign Currency Translation | Derivatives | Defined Benefit Pension Plans | Total AOCI | ||||||||||||||||||||||
Balance, September 1, 2023 | $ | ( | $ | $ | ( | $ | ( | |||||||||||||||||||
Other comprehensive income (loss) before reclassifications(1) | ( | ( | ( | |||||||||||||||||||||||
Reclassification for gain(2) | ( | ( | ||||||||||||||||||||||||
Net other comprehensive income (loss) | ( | ( | ( | |||||||||||||||||||||||
Balance, May 31, 2024 | $ | ( | $ | $ | ( | $ | ( |
Three Months Ended May 31, 2023 | ||||||||||||||||||||||||||
(in thousands) | Foreign Currency Translation | Derivatives | Defined Benefit Pension Plans | Total AOCI | ||||||||||||||||||||||
Balance, March 1, 2023 | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||
Other comprehensive income (loss) before reclassifications(1) | ( | ( | ||||||||||||||||||||||||
Reclassification for gain(2) | ( | ( | ||||||||||||||||||||||||
Net other comprehensive income (loss) | ( | ( | ||||||||||||||||||||||||
Balance, May 31, 2023 | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||
Nine Months Ended May 31, 2023 | ||||||||||||||||||||||||||
(in thousands) | Foreign Currency Translation | Derivatives | Defined Benefit Pension Plans | Total AOCI | ||||||||||||||||||||||
Balance, September 1, 2022 | $ | ( | $ | $ | ( | $ | ( | |||||||||||||||||||
Other comprehensive income before reclassifications(1) | ||||||||||||||||||||||||||
Reclassification for gain(2) | ( | ( | ||||||||||||||||||||||||
Net other comprehensive income | ||||||||||||||||||||||||||
Balance, May 31, 2023 | $ | ( | $ | $ | ( | $ |
(in thousands) | May 31, 2024 | August 31, 2023 | ||||||||||||
Contract assets (included in accounts receivable) | $ | $ | ||||||||||||
Contract liabilities (included in accrued expenses and other payables) |
(in thousands) | May 31, 2024 | August 31, 2023 | ||||||||||||
Raw materials | $ | $ | ||||||||||||
Work in process | ||||||||||||||
Finished goods | ||||||||||||||
Total | $ | $ |
(in thousands) | North America | Europe | North America Steel Group | Europe Steel Group | Emerging Businesses Group | Consolidated | ||||||||||||||||||||||||||||||||
Goodwill, gross | ||||||||||||||||||||||||||||||||||||||
Balance, September 1, 2023 | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
Segment reassignment | ( | ( | ||||||||||||||||||||||||||||||||||||
Acquisition adjustments(1) | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||
Foreign currency translation | ||||||||||||||||||||||||||||||||||||||
Balance, May 31, 2024 | ||||||||||||||||||||||||||||||||||||||
Accumulated impairment | ||||||||||||||||||||||||||||||||||||||
Balance, September 1, 2023 | ( | ( | ( | |||||||||||||||||||||||||||||||||||
Segment reassignment | ( | ( | ( | |||||||||||||||||||||||||||||||||||
Foreign currency translation | ( | ( | ||||||||||||||||||||||||||||||||||||
Balance, May 31, 2024 | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Goodwill, net | ||||||||||||||||||||||||||||||||||||||
Balance, September 1, 2023 | ||||||||||||||||||||||||||||||||||||||
Segment reassignment | ( | ( | ||||||||||||||||||||||||||||||||||||
Acquisition adjustments(1) | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||
Foreign currency translation | ||||||||||||||||||||||||||||||||||||||
Balance, May 31, 2024 | $ | $ | $ | $ | $ | $ |
(in thousands) | May 31, 2024 | August 31, 2023 | ||||||||||||
Trade names | $ | $ | ||||||||||||
In-process research and development | ||||||||||||||
Non-compete agreements | ||||||||||||||
Total | $ | $ |
May 31, 2024 | August 31, 2023 | |||||||||||||||||||||||||||||||||||||
(in thousands) | Gross Carrying Amount | Accumulated Amortization | Net | Gross Carrying Amount | Accumulated Amortization | Net | ||||||||||||||||||||||||||||||||
Developed technologies | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
Customer relationships | ||||||||||||||||||||||||||||||||||||||
Patents | ||||||||||||||||||||||||||||||||||||||
Perpetual lease rights | ||||||||||||||||||||||||||||||||||||||
Trade names | ||||||||||||||||||||||||||||||||||||||
Non-compete agreements | ||||||||||||||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ |
(in thousands) | ||||||||
Remainder of 2024 | $ | |||||||
2025 | ||||||||
2026 | ||||||||
2027 | ||||||||
2028 |
(in thousands) | Weighted Average Interest Rate as of May 31, 2024 | May 31, 2024 | August 31, 2023 | |||||||||||||||||
2030 Notes | $ | $ | ||||||||||||||||||
2031 Notes | ||||||||||||||||||||
2032 Notes | ||||||||||||||||||||
Series 2022 Bonds, due 2047 | ||||||||||||||||||||
Short-term borrowings | (1) | |||||||||||||||||||
Other | ||||||||||||||||||||
Finance leases | ||||||||||||||||||||
Total debt | ||||||||||||||||||||
Less unamortized debt issuance costs | ( | ( | ||||||||||||||||||
Plus unamortized bond premium | ||||||||||||||||||||
Total amounts outstanding | ||||||||||||||||||||
Less current maturities of long-term debt and short-term borrowings | ( | ( | ||||||||||||||||||
Long-term debt | $ | $ |
Commodity | Position | Total | |||||||||||||||
Aluminum | Long | MT | |||||||||||||||
Aluminum | Short | MT | |||||||||||||||
Copper | Long | MT | |||||||||||||||
Copper | Short | MT | |||||||||||||||
Electricity | Long | MW(h) | |||||||||||||||
Natural Gas | Long | MMBtu |
(in thousands) | Primary Location | May 31, 2024 | August 31, 2023 | |||||||||||||||||
Derivative assets: | ||||||||||||||||||||
Commodity | Prepaid and other current assets | $ | $ | |||||||||||||||||
Commodity | Other noncurrent assets | |||||||||||||||||||
Foreign exchange | Prepaid and other current assets | |||||||||||||||||||
Derivative liabilities: | ||||||||||||||||||||
Commodity | Accrued expenses and other payables | $ | $ | |||||||||||||||||
Commodity | Other noncurrent liabilities | |||||||||||||||||||
Foreign exchange | Accrued expenses and other payables |
Gain (Loss) on Derivatives Not Designated as Hedging Instruments (in thousands) | Three Months Ended May 31, | Nine Months Ended May 31, | ||||||||||||||||||||||||||||||
Primary Location | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||||||||
Commodity | Cost of goods sold | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||||||||||
Foreign exchange | SG&A expenses |
Effective Portion of Derivatives Designated as Cash Flow Hedging Instruments Gain (Loss) Recognized in OCI, Net of Income Taxes (in thousands) | Three Months Ended May 31, | Nine Months Ended May 31, | ||||||||||||||||||||||||
2024 | 2023 | 2024 | 2023 | |||||||||||||||||||||||
Commodity | $ | ( | $ | ( | $ | ( | $ | |||||||||||||||||||
Foreign exchange |
Gain (Loss) on Derivatives Designated as Cash Flow Hedging Instruments Reclassified from AOCI into Net Earnings (in thousands) | Three Months Ended May 31, | Nine Months Ended May 31, | ||||||||||||||||||||||||||||||
Primary Location | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||||||||
Commodity | Cost of goods sold | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||
Foreign exchange | SG&A expenses |
Fair Value Measurements at Reporting Date Using | ||||||||||||||||||||||||||
(in thousands) | Total | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||||||||||||
As of May 31, 2024: | ||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||
Investment deposit accounts(1) | $ | $ | $ | $ | ||||||||||||||||||||||
Commodity derivative assets(2) | ||||||||||||||||||||||||||
Foreign exchange derivative assets(2) | ||||||||||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||
Commodity derivative liabilities(2) | ||||||||||||||||||||||||||
Foreign exchange derivative liabilities(2) | ||||||||||||||||||||||||||
As of August 31, 2023: | ||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||
Investment deposit accounts(1) | $ | $ | $ | $ | ||||||||||||||||||||||
Commodity derivative assets(2) | ||||||||||||||||||||||||||
Foreign exchange derivative assets(2) | ||||||||||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||
Commodity derivative liabilities(2) | ||||||||||||||||||||||||||
Foreign exchange derivative liabilities(2) |
Floating rate (PLN) | ||||||||||||||||||||
Low | High | Average | ||||||||||||||||||
May 31, 2024 | ||||||||||||||||||||
August 31, 2023 |
(in thousands) | Three Months Ended May 31, 2024 | |||||||
Balance, March 1, 2024 | $ | |||||||
Total activity, realized and unrealized: | ||||||||
Unrealized holding loss before reclassification(1) | ( | |||||||
Reclassification for gain included in net earnings(2) | ( | |||||||
Balance, May 31, 2024 | $ | |||||||
(in thousands) | Nine Months Ended May 31, 2024 | |||||||
Balance, September 1, 2023 | $ | |||||||
Total activity, realized and unrealized: | ||||||||
Unrealized holding loss before reclassification(1) | ( | |||||||
Reclassification for gain included in net earnings(2) | ( | |||||||
Balance, May 31, 2024 | $ | |||||||
(in thousands) | Three Months Ended May 31, 2023 | |||||||
Balance, March 1, 2023 | $ | |||||||
Total activity, realized and unrealized: | ||||||||
Unrealized holding gain before reclassification(1) | ||||||||
Reclassification for gain included in net earnings(2) | ( | |||||||
Balance, May 31, 2023 | $ | |||||||
(in thousands) | Nine Months Ended May 31, 2023 | |||||||
Balance, September 1, 2022 | $ | |||||||
Total activity, realized and unrealized: | ||||||||
Unrealized holding gain before reclassification(1) | ||||||||
Reclassification for gain included in net earnings(2) | ( | |||||||
Balance, May 31, 2023 | $ |
Shares | Weighted Average Fair Value | |||||||||||||
Outstanding as of August 31, 2023 | $ | |||||||||||||
Granted | ||||||||||||||
Vested | ( | |||||||||||||
Forfeited | ( | |||||||||||||
Outstanding as of May 31, 2024 | $ |
Three Months Ended May 31, | Nine Months Ended May 31, | |||||||||||||||||||||||||
(in thousands) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
Stock-based compensation expense | $ | $ | $ | $ |
Three Months Ended May 31, | Nine Months Ended May 31, | |||||||||||||||||||||||||
(in thousands, except share and per share data) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
Net earnings | $ | $ | $ | $ | ||||||||||||||||||||||
Average basic shares outstanding | ||||||||||||||||||||||||||
Effect of dilutive securities | ||||||||||||||||||||||||||
Average diluted shares outstanding | ||||||||||||||||||||||||||
Earnings per share: | ||||||||||||||||||||||||||
Basic | $ | $ | $ | $ | ||||||||||||||||||||||
Diluted |
Three Months Ended May 31, | Nine Months Ended May 31, | |||||||||||||||||||||||||
(in thousands) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
Net sales to external customers: | ||||||||||||||||||||||||||
North America Steel Group | $ | $ | $ | $ | ||||||||||||||||||||||
Europe Steel Group | ||||||||||||||||||||||||||
Emerging Businesses Group | ||||||||||||||||||||||||||
Reportable segments total | ||||||||||||||||||||||||||
Corporate and Other | ||||||||||||||||||||||||||
Total | $ | $ | $ | $ |
Adjusted EBITDA: | ||||||||||||||||||||||||||
North America Steel Group | $ | $ | $ | $ | ||||||||||||||||||||||
Europe Steel Group | ( | |||||||||||||||||||||||||
Emerging Businesses Group | ||||||||||||||||||||||||||
Reportable segments total | $ | $ | $ | $ |
May 31, 2024 | August 31, 2023 | |||||||||||||||||||||||||
Total assets: | ||||||||||||||||||||||||||
North America Steel Group | $ | $ | ||||||||||||||||||||||||
Europe Steel Group | ||||||||||||||||||||||||||
Emerging Businesses Group | ||||||||||||||||||||||||||
Reportable segments total | ||||||||||||||||||||||||||
Corporate and Other | ||||||||||||||||||||||||||
Total | $ | $ |
Three Months Ended May 31, | Nine Months Ended May 31, | |||||||||||||||||||||||||
(in thousands) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
Net earnings | $ | $ | $ | $ | ||||||||||||||||||||||
Interest expense | ||||||||||||||||||||||||||
Income taxes | ||||||||||||||||||||||||||
Depreciation and amortization | ||||||||||||||||||||||||||
Asset impairments | ||||||||||||||||||||||||||
Corporate and Other expenses | ||||||||||||||||||||||||||
Adjusted EBITDA reportable segments | $ | $ | $ | $ |
Three Months Ended May 31, 2024 | ||||||||||||||||||||||||||||||||
(in thousands) | North America Steel Group | Europe Steel Group | Emerging Businesses Group | Corporate and Other | Total | |||||||||||||||||||||||||||
Major product: | ||||||||||||||||||||||||||||||||
Raw materials | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
Steel products | ||||||||||||||||||||||||||||||||
Downstream products | ||||||||||||||||||||||||||||||||
Construction products | ||||||||||||||||||||||||||||||||
Ground stabilization solutions | ||||||||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||||||||
Net sales to external customers | ||||||||||||||||||||||||||||||||
Intersegment net sales, eliminated in consolidation | ( | — | ||||||||||||||||||||||||||||||
Net sales | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||
Nine Months Ended May 31, 2024 | ||||||||||||||||||||||||||||||||
(in thousands) | North America Steel Group | Europe Steel Group | Emerging Businesses Group | Corporate and Other | Total | |||||||||||||||||||||||||||
Major product: | ||||||||||||||||||||||||||||||||
Raw materials | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
Steel products | ||||||||||||||||||||||||||||||||
Downstream products | ||||||||||||||||||||||||||||||||
Construction products | ||||||||||||||||||||||||||||||||
Ground stabilization solutions | ||||||||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||||||||
Net sales to external customers | ||||||||||||||||||||||||||||||||
Intersegment net sales, eliminated in consolidation | ( | — | ||||||||||||||||||||||||||||||
Net sales | $ | $ | $ | $ | ( | $ |
Three Months Ended May 31, 2023 | ||||||||||||||||||||||||||||||||
(in thousands) | North America Steel Group | Europe Steel Group | Emerging Businesses Group | Corporate and Other | Total | |||||||||||||||||||||||||||
Major product: | ||||||||||||||||||||||||||||||||
Raw materials | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
Steel products | ||||||||||||||||||||||||||||||||
Downstream products | ||||||||||||||||||||||||||||||||
Construction products | ||||||||||||||||||||||||||||||||
Ground stabilization solutions | ||||||||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||||||||
Net sales to external customers | ||||||||||||||||||||||||||||||||
Intersegment net sales, eliminated in consolidation | ( | — | ||||||||||||||||||||||||||||||
Net sales | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||
Nine Months Ended May 31, 2023 | ||||||||||||||||||||||||||||||||
(in thousands) | North America Steel Group | Europe Steel Group | Emerging Businesses Group | Corporate and Other | Total | |||||||||||||||||||||||||||
Major product: | ||||||||||||||||||||||||||||||||
Raw materials | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
Steel products | ||||||||||||||||||||||||||||||||
Downstream products | ||||||||||||||||||||||||||||||||
Construction products | ||||||||||||||||||||||||||||||||
Ground stabilization solutions | ||||||||||||||||||||||||||||||||
Other(1) | ||||||||||||||||||||||||||||||||
Net sales to external customers | ||||||||||||||||||||||||||||||||
Intersegment net sales, eliminated in consolidation | ( | — | ||||||||||||||||||||||||||||||
Net sales | $ | $ | $ | $ | ( | $ |
Three Months Ended May 31, | Nine Months Ended May 31, | |||||||||||||||||||||||||
(in thousands, except per share data) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
Net sales | $ | 2,078,485 | $ | 2,344,989 | $ | 5,929,823 | $ | 6,590,305 | ||||||||||||||||||
Net earnings | 119,440 | 233,971 | 381,560 | 675,594 | ||||||||||||||||||||||
Diluted earnings per share | $ | 1.02 | $ | 1.98 | $ | 3.25 | $ | 5.69 |
Three Months Ended May 31, | Nine Months Ended May 31, | |||||||||||||||||||||||||
(in thousands, except per ton amounts) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
Net sales to external customers | $ | 1,671,358 | $ | 1,818,391 | $ | 4,750,210 | $ | 4,986,326 | ||||||||||||||||||
Adjusted EBITDA | 246,304 | 367,561 | 735,418 | 991,588 | ||||||||||||||||||||||
External tons shipped | ||||||||||||||||||||||||||
Raw materials | 371 | 409 | 1,092 | 1,046 | ||||||||||||||||||||||
Rebar | 520 | 539 | 1,502 | 1,425 | ||||||||||||||||||||||
Merchant bar and other | 244 | 249 | 708 | 727 | ||||||||||||||||||||||
Steel products | 764 | 788 | 2,210 | 2,152 | ||||||||||||||||||||||
Downstream products | 371 | 382 | 1,033 | 1,079 | ||||||||||||||||||||||
Average selling price (per ton) | ||||||||||||||||||||||||||
Raw materials | $ | 970 | $ | 833 | $ | 877 | $ | 841 | ||||||||||||||||||
Steel products | 891 | 979 | 896 | 994 | ||||||||||||||||||||||
Downstream products | 1,330 | 1,452 | 1,358 | 1,424 | ||||||||||||||||||||||
Cost of ferrous scrap utilized per ton | $ | 353 | $ | 384 | $ | 358 | $ | 352 | ||||||||||||||||||
Steel products metal margin per ton | 538 | 595 | 538 | 642 |
Three Months Ended May 31, | Nine Months Ended May 31, | |||||||||||||||||||||||||
(in thousands, except per ton amounts) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
Net sales to external customers | $ | 208,806 | $ | 330,767 | $ | 626,481 | $ | 1,054,830 | ||||||||||||||||||
Adjusted EBITDA | (4,192) | 5,837 | 26,139 | 78,554 | ||||||||||||||||||||||
External tons shipped | ||||||||||||||||||||||||||
Rebar | 80 | 146 | 266 | 533 | ||||||||||||||||||||||
Merchant bar and other | 217 | 283 | 649 | 805 | ||||||||||||||||||||||
Steel products | 297 | 429 | 915 | 1,338 | ||||||||||||||||||||||
Average selling price (per ton) | ||||||||||||||||||||||||||
Steel products | $ | 681 | $ | 753 | $ | 661 | $ | 768 | ||||||||||||||||||
Cost of ferrous scrap utilized per ton | $ | 389 | $ | 427 | $ | 383 | $ | 395 | ||||||||||||||||||
Steel products metal margin per ton | 292 | 326 | 278 | 373 |
Three Months Ended May 31, | Nine Months Ended May 31, | |||||||||||||||||||||||||
(in thousands) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
Net sales to external customers | $ | 188,593 | $ | 189,055 | $ | 521,826 | $ | 513,187 | ||||||||||||||||||
Adjusted EBITDA | 38,220 | 38,395 | 87,011 | 96,372 |
Three Months Ended May 31, | Nine Months Ended May 31, | |||||||||||||||||||||||||
(in thousands) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
Adjusted EBITDA loss | $ | (37,070) | $ | (37,715) | $ | (102,569) | $ | (93,013) |
(in thousands) | Liquidity Sources and Facilities | Availability | ||||||||||||
Cash and cash equivalents | $ | 698,338 | $ | 698,338 | ||||||||||
Notes due from 2030 to 2032 | 900,000 | (1) | ||||||||||||
Revolver | 600,000 | 599,057 | ||||||||||||
Series 2022 Bonds, due 2047 | 145,060 | — | ||||||||||||
Poland credit facilities | 152,307 | 149,990 | ||||||||||||
Poland accounts receivable facility | 73,108 | 45,104 | ||||||||||||
Issuer Purchases of Equity Securities(1) | ||||||||||||||||||||||||||
Period | Total Number of Shares Purchased | Average Price Paid Per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs as of the End of Period | ||||||||||||||||||||||
March 1, 2024 - March 31, 2024 | 366,990 | $ | 54.52 | 366,990 | $ | 490,368,120 | ||||||||||||||||||||
April 1, 2024 - April 30, 2024 | 380,301 | 56.42 | 380,301 | 468,911,153 | ||||||||||||||||||||||
May 1, 2024 - May 31, 2024 | 183,990 | 56.27 | 183,990 | 458,558,228 | ||||||||||||||||||||||
931,281 | 931,281 |
2.1† | |||||
3.1(a) | |||||
3.1(b) | |||||
3.1(c) | |||||
3.1(d) | |||||
3.1(e) | |||||
3.1(f) | |||||
3.2 | |||||
31.1 | |||||
31.2 | |||||
32.1 | |||||
32.2 | |||||
101.INS | Inline XBRL Instance Document (filed herewith). | ||||
101.SCH | Inline XBRL Taxonomy Extension Schema Document (filed herewith). | ||||
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document (filed herewith). | ||||
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document (filed herewith). | ||||
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document (filed herewith). | ||||
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document (filed herewith). | ||||
104 | Cover Page Interactive Data File (formatted as Inline XBRL document and included in Exhibit 101). |
COMMERCIAL METALS COMPANY | |||||
June 25, 2024 | /s/ Paul J. Lawrence | ||||
Paul J. Lawrence | |||||
Senior Vice President and Chief Financial Officer | |||||
(Duly authorized officer and principal financial officer of the registrant) |
/s/ Peter R. Matt | ||
Peter R. Matt | ||
President and Chief Executive Officer |
/s/ Paul J. Lawrence | ||
Paul J. Lawrence | ||
Senior Vice President and Chief Financial Officer |
/s/ Peter R. Matt | ||
Peter R. Matt | ||
President and Chief Executive Officer |
/s/ Paul J. Lawrence | ||
Paul J. Lawrence | ||
Senior Vice President and Chief Financial Officer |
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
May 31, 2024 |
May 31, 2023 |
May 31, 2024 |
May 31, 2023 |
|
Income Statement [Abstract] | ||||
Net sales | $ 2,078,485 | $ 2,344,989 | $ 5,929,823 | $ 6,590,305 |
Costs and operating expenses: | ||||
Cost of goods sold | 1,738,086 | 1,862,299 | 4,894,200 | 5,203,476 |
Selling, general and administrative expenses | 167,975 | 163,742 | 497,951 | 470,902 |
Interest expense | 12,117 | 8,878 | 35,751 | 31,868 |
Net costs and operating expenses | 1,918,178 | 2,034,919 | 5,427,902 | 5,706,246 |
Earnings before income taxes | 160,307 | 310,070 | 501,921 | 884,059 |
Income taxes | 40,867 | 76,099 | 120,361 | 208,465 |
Net earnings | $ 119,440 | $ 233,971 | $ 381,560 | $ 675,594 |
Earnings per share: | ||||
Basic (in USD per share) | $ 1.03 | $ 2.00 | $ 3.28 | $ 5.76 |
Diluted (in USD per share) | $ 1.02 | $ 1.98 | $ 3.25 | $ 5.69 |
Average basic shares outstanding (shares) | 115,529,942 | 117,066,623 | 116,228,826 | 117,192,710 |
Average diluted shares outstanding (shares) | 116,664,885 | 118,397,899 | 117,583,055 | 118,747,084 |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
May 31, 2024 |
May 31, 2023 |
May 31, 2024 |
May 31, 2023 |
|
Statement of Comprehensive Income [Abstract] | ||||
Net earnings | $ 119,440 | $ 233,971 | $ 381,560 | $ 675,594 |
Other comprehensive income (loss), net of income taxes: | ||||
Foreign currency translation adjustments | 9,845 | 42,723 | 34,679 | 95,780 |
Derivatives: | ||||
Net unrealized holding gain (loss) | (29,559) | (11,848) | (120,428) | 80,154 |
Reclassification for realized (gain) loss | 553 | (295) | (1,135) | (8,128) |
Net unrealized gain (loss) on derivatives | (29,006) | (12,143) | (121,563) | 72,026 |
Defined benefit plans gain (loss) after amortization of prior service costs | (9) | (94) | (27) | 1,627 |
Total other comprehensive income (loss), net of income taxes | (19,170) | 30,486 | (86,911) | 169,433 |
Comprehensive income | $ 100,270 | $ 264,457 | $ 294,649 | $ 845,027 |
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical) - USD ($) $ in Thousands |
May 31, 2024 |
Aug. 31, 2023 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Accounts Receivable, Allowance for Credit Loss, Current | $ 4,375 | $ 4,135 |
Common stock, par value (in USD per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 200,000,000 | 200,000,000 |
Common stock, shares, issued (in shares) | 129,060,664 | 129,060,664 |
Common stock, shares, outstanding (in shares) | 115,104,191 | 116,515,427 |
Treasury stock (in shares) | 13,956,473 | 12,545,237 |
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (UNAUDITED) (Parenthetical) - $ / shares |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
May 31, 2024 |
May 31, 2023 |
May 31, 2024 |
May 31, 2023 |
|
Statement of Stockholders' Equity [Abstract] | ||||
Cash dividends per share (in USD per share) | $ 0.18 | $ 0.16 | $ 0.50 | $ 0.48 |
NATURE OF OPERATIONS AND ACCOUNTING POLICIES |
9 Months Ended |
---|---|
May 31, 2024 | |
Accounting Policies [Abstract] | |
NATURE OF OPERATIONS AND ACCOUNTING POLICIES | NOTE 1. NATURE OF OPERATIONS AND ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") on a basis consistent with that used in the Annual Report on Form 10-K for the year ended August 31, 2023 (the "2023 Form 10-K") filed by Commercial Metals Company ("CMC," and together with its consolidated subsidiaries, the "Company") with the United States ("U.S.") Securities and Exchange Commission (the "SEC") and include all normal recurring adjustments necessary to present fairly the condensed consolidated balance sheets and the condensed consolidated statements of earnings, comprehensive income, cash flows and stockholders' equity for the periods indicated. These notes should be read in conjunction with the consolidated financial statements and notes included in the 2023 Form 10-K. The results of operations for the three and nine month periods ended May 31, 2024 are not necessarily indicative of the results to be expected for the full fiscal year. Any reference in this Form 10-Q to the "corresponding period" or "comparable period" relates to the relevant three or nine month period ended May 31, 2023. Any reference in this Form 10-Q to a year refers to the fiscal year ended August 31st of that year, unless otherwise noted. Nature of Operations CMC is an innovative solutions provider helping build a stronger, safer and more sustainable world. Through an extensive manufacturing network principally located in the U.S. and Central Europe, the Company offers products and technologies to meet the critical reinforcement needs of the global construction sector. CMC’s solutions support construction across a wide variety of applications, including infrastructure, non-residential, residential, industrial and energy generation and transmission. During the first quarter of 2024, CMC changed its reportable segments to reflect a change in the manner in which the business is managed. Based on changes to CMC’s organizational structure, the evolution of CMC’s solutions offerings outside of traditional steel products, the growing importance of non-steel solutions to CMC’s financial results and future outlook and how CMC's chief operating decision maker ("CODM"), the President and Chief Executive Officer, reviews operating results and makes decisions about resource allocation, CMC now has three reportable segments: North America Steel Group, Europe Steel Group and Emerging Businesses Group. North America Steel Group The North America Steel Group segment is composed of a vertically integrated network of recycling facilities, steel mills and fabrication operations located in the U.S. The recycling facilities process ferrous and nonferrous scrap metals (collectively referred to as "raw materials") for use by manufacturers of metal products. The steel mill operations consist of six electric arc furnace ("EAF") mini mills, three EAF micro mills and one rerolling mill. The steel mills manufacture finished long steel products including reinforcing bar ("rebar"), merchant bar, light structural and other special sections and wire rod, as well as semi-finished billets for rerolling and forging applications (collectively referred to as "steel products"). The fabrication operations primarily fabricate rebar and steel fence posts and offer post-tension cable products (collectively referred to as "downstream products" in the context of the North America Steel Group segment). The general strategy in the North America Steel Group segment is to optimize the Company's vertically integrated value chain to maximize profitability by obtaining the lowest possible input costs and highest possible selling prices. The Company operates the recycling facilities to provide low-cost scrap to the steel mills and the fabrication operations to optimize the steel mill volumes. The North America Steel Group segment's products are sold primarily to steel mills and foundries, as well as construction, fabrication and other manufacturing industries. Europe Steel Group The Europe Steel Group segment is composed of a vertically integrated network of recycling facilities, an EAF mini mill and fabrication operations located in Poland. The scrap metal recycling facilities process ferrous scrap metals for use almost exclusively by the mini mill. The steel products manufactured by the mini mill include rebar, merchant bar and wire rod as well as semi-finished billets. The products manufactured by this segment's fabrication operations include fabricated rebar, wire mesh, assembled rebar cages and other fabricated rebar by-products (collectively referred to as "downstream products" in the context of the Europe Steel Group segment). The strategy in the Europe Steel Group segment is to optimize profitability of the products manufactured by the mini mill and is executed in the same manner as in the North America Steel Group segment. The Europe Steel Group segment's products are sold primarily to fabricators, manufacturers, distributors and construction companies. Emerging Businesses Group The Emerging Businesses Group segment's portfolio consists of CMC Construction ServicesTM products (collectively referred to as "construction products"), Tensar® products and solutions (collectively referred to as "ground stabilization solutions") and CMC Impact MetalsTM, CMC Anchoring Systems and performance reinforcing steel products (collectively referred to as "downstream products" in the context of the Emerging Businesses Group segment). •CMC Construction ServicesTM operations sell and rent products and equipment used to execute construction projects. Primary customers include concrete installers and other businesses in the construction industry. •Tensar® operations sell geogrids and Geopier® foundation systems. Geogrids are polymer-based products used for ground stabilization, soil reinforcement and asphalt optimization in construction applications, including roadways, public infrastructure and industrial facilities. Geopier® foundation systems are rammed aggregate pier and other foundation solutions that increase the load-bearing characteristics of ground structures and working surfaces and can be applied in soil types and construction situations in which traditional support methods are impractical or would make a project infeasible. •CMC Impact MetalsTM operations manufacture heat-treated, high-strength steel products, such as high-strength bar for the truck trailer industry, special bar quality steel for the energy market and armor plate for military vehicles. •CMC Anchoring Systems' operations supply custom engineered anchor cages, bolts and fasteners that are fabricated principally from rebar and are used primarily to secure high voltage electrical transmission poles to concrete foundations. •CMC's group of performance reinforcing steel offerings include innovative products such as Galvabar® (galvanized rebar with a zinc alloy coating that provides corrosion protection and post-fabrication formability), ChromX® (designed for high-strength capabilities, corrosion resistance and a service life of more than 100 years) and CryoSteel® (a cryogenic reinforcing steel that exceeds minimum performance requirements for strength and ductility at extremely low temperatures). The strategy in the Emerging Businesses Group segment is to provide construction-related solutions and value-added products with strong underlying growth fundamentals to serve domestic and international markets that are adjacent to those served by the vertically integrated operations in the North America Steel Group segment and the Europe Steel Group segment. To execute this strategy, the Company (i) develops proprietary products and solutions that deliver high value to customers by reducing costs and construction time, (ii) provides concrete-related construction products, equipment, and services and (iii) produces reinforcing steel products with increased strength, durability and corrosion resistance to support sustainable concrete construction. As a result of the change in reportable segments, certain prior year amounts have been recast to conform to the current year presentation. Throughout this Form 10-Q, unless otherwise indicated, amounts and activity reflect reclassifications related to the Company's change in reportable segments. The change in reportable segments had no impact on the Company’s condensed consolidated balance sheets and the condensed consolidated statements of earnings, comprehensive income, cash flows and stockholders’ equity previously reported. Recently Issued Accounting Pronouncements In November 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures ("ASU 2023-07"). ASU 2023-07 requires, among other updates, enhanced disclosures about significant segment expenses that are regularly provided to the CODM, as well as the aggregate amount of other segment items included in the reported measure of segment profit or loss. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, and requires retrospective adoption. Early adoption is permitted. The Company is evaluating the impact of this guidance on its consolidated financial statements and disclosures. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures ("ASU 2023-09"). ASU 2023-09 requires enhanced annual disclosures regarding the rate reconciliation and income taxes paid information. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024 and may be adopted on a prospective or retrospective basis. Early adoption is permitted. The Company is evaluating the impact of this guidance on its consolidated financial statements and disclosures.
|
CHANGES IN BUSINESS |
9 Months Ended |
---|---|
May 31, 2024 | |
Business Combinations [Abstract] | |
Changes in Business | NOTE 2. CHANGES IN BUSINESS 2023 Acquisitions On September 15, 2022, the Company completed the acquisition of Advanced Steel Recovery, LLC ("ASR"), a supplier of recycled ferrous metals located in Southern California. ASR's primary operations include processing and brokering capabilities that source material for sale into both the domestic and export markets. On November 14, 2022, the Company completed the acquisition of a Galveston, Texas area metals recycling facility and related assets (collectively, "Kodiak") from Kodiak Resources, Inc. and Kodiak Properties, L.L.C. On March 3, 2023, the Company completed the acquisition of all of the assets of Roane Metals Group, LLC ("Roane"), a supplier of recycled metals with two facilities located in eastern Tennessee. On March 17, 2023, the Company completed the acquisition of Tendon Systems, LLC ("Tendon"), a leading provider of post-tensioning, barrier cable and concrete restoration solutions to the southeastern U.S. On May 1, 2023, the Company completed the acquisition of all of the assets of BOSTD America, LLC ("BOSTD"), a geogrid manufacturing facility located in Blackwell, Oklahoma. Prior to the acquisition, BOSTD produced several product lines for the Company's Tensar® operations under a contract manufacturing arrangement. On July 12, 2023, the Company completed the acquisition of EDSCO Fasteners, LLC ("EDSCO"), a leading provider of anchoring solutions for the electrical transmission market, with four manufacturing facilities located in North Carolina, Tennessee, Texas and Utah. Following the acquisition, EDSCO was rebranded as CMC Anchoring Systems. The acquisitions of ASR, Kodiak, Roane, Tendon, BOSTD and EDSCO (the "2023 acquisitions") were not material individually, or in the aggregate, to the Company's financial position or results of operations, and therefore, pro forma operating results and other disclosures are not presented. Operating results for the acquired operations of ASR, Kodiak, Roane and Tendon are presented within the Company's North America Steel Group segment. Operating results for BOSTD and CMC Anchoring Systems are presented within the Company's Emerging Businesses Group segment.
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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) |
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Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated other comprehensive income (loss) | NOTE 3. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The following tables reflect the changes in accumulated other comprehensive income (loss) ("AOCI"):
__________________________________ (1) Other comprehensive income (loss) ("OCI") before reclassifications from derivatives is presented net of income tax (expense) benefit of $6.9 million and $28.4 million for the three and nine months ended May 31, 2024, respectively, and $2.8 million and $(18.4) million for the three and nine months ended May 31, 2023, respectively. OCI before reclassifications from defined benefit pension plans is presented net of immaterial income tax impacts. (2) Reclassifications for (gains) losses from derivatives included in net earnings are primarily recorded in cost of goods sold in the condensed consolidated statements of earnings and are presented net of immaterial income tax impacts.
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REVENUE RECOGNITION |
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May 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue Recognition | NOTE 4. REVENUE RECOGNITION The majority of the Company's revenue is recognized at a point in time concurrent with the transfer of control, which usually occurs, depending on shipping terms, upon shipment or customer receipt. See Note 13, Segment Information, for further information about disaggregated revenue by the Company's major product lines. Certain revenue from the Company's downstream products in the North America Steel Group segment is not recognized at a point in time. Revenue resulting from sales of fabricated rebar in the North America Steel Group segment is recognized over time, as discussed below. Revenue resulting from sales of steel fence posts and other downstream products in the North America Steel Group segment is recognized equal to billing under an available practical expedient. Each of the North America Steel Group segment's fabricated rebar contracts represent a single performance obligation. Revenue from certain fabricated rebar contracts for which the Company provides fabricated product and installation services is recognized over time using an input measure. These contracts represented 7% of net sales in the North America Steel Group segment during both the three months ended May 31, 2024 and 2023, and 8% of net sales in the North America Steel Group segment during both the nine months ended May 31, 2024 and 2023. Revenue from fabricated rebar contracts for which the Company does not provide installation services is recognized over time using an output measure. These contracts represented 10% of net sales in the North America Steel Group segment in each of the three and nine months ended May 31, 2024, and 11% and 12% of net sales in the North America Steel Group segment in the three and nine months ended May 31, 2023, respectively. The following table provides information about assets and liabilities from contracts with customers recognized over time:
The amount of revenue reclassified from August 31, 2023 contract liabilities during the nine months ended May 31, 2024 was approximately $25.2 million. Remaining Performance Obligations As of May 31, 2024, revenue totaling $1.0 billion has been allocated to remaining performance obligations in the North America Steel Group segment related to contracts for which revenue is recognized using an input or output measure. Of this amount, the Company estimates that approximately 78% of the remaining performance obligations will be recognized in the twelve months following May 31, 2024, and the remainder will be recognized during the subsequent twelve months. The duration of all other contracts in the North America Steel Group, Europe Steel Group and Emerging Businesses Group segments are typically less than one year.
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INVENTORIES, NET |
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May 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventories, net | NOTE 5. INVENTORIES, NET The majority of the Company's inventories are in the form of semi-finished and finished steel products. Under the Company’s vertically integrated business models in the North America Steel Group segment and the Europe Steel Group segment, steel products are sold to external customers in various stages, from semi-finished billets through fabricated steel, leading these categories to be combined as finished goods. The components of inventories were as follows:
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GOODWILL AND OTHER INTANGIBLES |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and other intangibles | NOTE 6. GOODWILL AND OTHER INTANGIBLES Goodwill by reportable segment is detailed in the table below. During the first quarter of 2024, the Company changed its reportable segments as described in Note 1, Nature of Operations and Accounting Policies. Concurrent with the change in reportable segments, the Company reassigned goodwill to the updated reporting units using a relative fair value approach, shown below:
__________________________________ (1) Measurement period adjustments related to the 2023 acquisitions which impacted the amount of goodwill originally reported. The Company evaluated impairment indicators for the previous reporting units immediately prior to the change in reportable segments and concluded there were no indicators of impairment. Immediately after the change in reportable segments, the Company performed qualitative tests for five reporting units consisting of $285.0 million of goodwill and quantitative tests for three reporting units consisting of $100.8 million of goodwill. The results of the qualitative and quantitative tests indicated it was more likely than not that the fair value of all reporting units with goodwill exceeded their carrying values. Other indefinite-lived intangible assets consisted of the following:
The change in the balance of intangible assets with indefinite lives from August 31, 2023 to May 31, 2024 was due to foreign currency translation adjustments. Other intangible assets subject to amortization are detailed in the following table:
The foreign currency translation adjustments for intangible assets subject to amortization were immaterial for all periods presented above. Amortization expense for intangible assets was $7.1 million and $21.6 million in the three and nine months ended May 31, 2024, respectively, of which $4.5 million and $13.9 million, respectively, was recorded in cost of goods sold and the remainder was recorded in selling, general and administrative ("SG&A") expenses in the condensed consolidated statements of earnings. Amortization expense for intangible assets was $6.6 million and $18.9 million in the three and nine months ended May 31, 2023, respectively, of which $4.7 million and $14.0 million, respectively, was recorded in cost of goods sold and the remainder was recorded in SG&A expenses in the condensed consolidated statements of earnings. Estimated amounts of amortization expense for intangible assets for the next five years are as follows:
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CREDIT ARRANGEMENTS |
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Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Credit arrangements | NOTE 7. CREDIT ARRANGEMENTS Long-term debt was as follows:
__________________________________ (1) The weighted average interest rate of short-term borrowings as of May 31, 2024 and August 31, 2023 was 6.800% and 7.800%, respectively. The Company's credit arrangements require compliance with certain covenants, including an interest coverage ratio and a debt to capitalization ratio. At May 31, 2024, the Company was in compliance with all financial covenants in its credit arrangements. Capitalized interest was $1.3 million and $3.7 million during the three and nine months ended May 31, 2024, respectively, compared to $6.2 million and $16.2 million, respectively, during the corresponding periods. Credit Facilities The Company has a Sixth Amended and Restated Credit Agreement (the "Credit Agreement") with a revolving credit facility (the "Revolver") of $600.0 million. The Company had no amounts drawn under the Revolver at May 31, 2024 or August 31, 2023. The availability under the Revolver was reduced by outstanding stand-by letters of credit totaling $0.9 million at each of May 31, 2024 and August 31, 2023. The Credit Agreement also provided for a delayed draw senior secured term loan facility with a maximum principal amount of $200.0 million, which expired undrawn in October 2023, in accordance with its terms. The Company has credit facilities in Poland through its subsidiary, CMC Poland Sp. z.o.o. ("CMCP"). At May 31, 2024 and August 31, 2023, CMCP's credit facilities totaled PLN 600.0 million, or $152.3 million and $145.4 million, respectively. There were no amounts outstanding under these facilities as of May 31, 2024 or August 31, 2023. The available balance of these credit facilities was reduced by outstanding stand-by letters of credit, guarantees and/or other financial assurance instruments, which totaled $2.3 million and $16.3 million at May 31, 2024 and August 31, 2023, respectively. Accounts Receivable Facility The Poland accounts receivable facility had a limit of PLN 288.0 million, or $73.1 million and $69.8 million, at May 31, 2024 and August 31, 2023, respectively. The Company had PLN 110.3 million, or $28.0 million, advance payments outstanding under the Poland accounts receivable facility at May 31, 2024, compared to PLN 34.7 million, or $8.4 million, advance payments outstanding at August 31, 2023. Other As of August 31, 2023, the Company had a $2.1 million Qualifying Equity Investment ("QEI") associated with its New Markets Tax Credit ("NMTC") transactions, which was included in current maturities of long-term debt and short-term borrowings in the Company's consolidated balance sheet. The QEI is described in Note 9, New Markets Tax Credit Transactions, to the consolidated financial statements in the 2023 Form 10-K. The Company repaid the outstanding QEI at maturity in March 2024.
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DERIVATIVES |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivatives | NOTE 8. DERIVATIVES At May 31, 2024 and August 31, 2023, the notional values of the Company's commodity contract commitments were $510.4 million and $456.4 million, respectively. At May 31, 2024 and August 31, 2023, the notional values of the Company's foreign currency contract commitments were $195.2 million and $221.4 million, respectively. The following table provides information regarding the Company's commodity contract commitments at May 31, 2024:
__________________________________ MT = Metric ton MW(h) = Megawatt hour MMBtu = Metric Million British thermal unit The following table summarizes the location and amounts of the fair value of the Company's derivative instruments reported in the condensed consolidated balance sheets:
The decrease in fair value of the Company's commodity derivatives reported within other noncurrent assets is primarily due to the decrease in the value of a significant input used to measure the fair value of the Company's Level 3 commodity derivatives at May 31, 2024 as compared to August 31, 2023. See Note 9, Fair Value, for further discussion of the measurement of the fair value of the Company's Level 3 commodity derivatives. The following table summarizes activities related to the Company's derivatives not designated as hedging instruments recognized in the condensed consolidated statements of earnings. All other activity related to the Company's derivatives not designated as hedging instruments was immaterial for the periods presented.
The following tables summarize activities related to the Company's derivatives designated as cash flow hedging instruments recognized in the condensed consolidated statements of comprehensive income and condensed consolidated statements of earnings. Amounts presented do not include the effects of foreign currency translation adjustments.
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FAIR VALUE |
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Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair value | NOTE 9. FAIR VALUE The Company has established a fair value hierarchy which prioritizes the inputs to the valuation techniques used to measure fair value into three levels. These levels are determined based on the lowest level input that is significant to the fair value measurement. Levels within the hierarchy are defined within Note 1, Nature of Operations and Summary of Significant Accounting Policies, to the consolidated financial statements in the 2023 Form 10-K. The Company presents the fair value of its derivative contracts on a net-by-counterparty basis when a legal right to offset exists under an enforceable netting agreement. The following table summarizes information regarding the Company's financial assets and financial liabilities that were measured at fair value on a recurring basis:
__________________________________ (1) Investment deposit accounts are short-term in nature, and the value is determined by principal plus interest. The investment portfolio mix can change each period based on the Company's assessment of investment options. (2) Derivative assets and liabilities classified as Level 1 are commodity futures contracts valued based on quoted market prices in the London Metal Exchange or New York Mercantile Exchange. Amounts in Level 2 are based on broker quotes in the over-the-counter market. Derivatives classified as Level 3 are described below. Further discussion regarding the Company's use of derivative instruments is included in Note 8, Derivatives. The fair value estimate of the Level 3 commodity derivatives are based on internally developed discounted cash flow models primarily utilizing unobservable inputs for which there is little or no market data. The Company forecasts future energy rates using a range of historical prices (the "floating rate"), which is the only significant unobservable input used in the Company's discounted cash flow models. Significantly higher or lower floating rates could have resulted in a material difference in the fair value measurement. The following table summarizes the range of floating rates used to measure the fair value of the Level 3 commodity derivatives at May 31, 2024 and August 31, 2023, which are applied uniformly across each of our Level 3 commodity derivatives:
Below is a reconciliation of the beginning and ending balances of the Level 3 commodity derivatives recognized in the condensed consolidated statements of comprehensive income. The fluctuation in energy rates over time causes volatility in the fair value estimates and is the primary reason for unrealized gains and losses included in OCI in the three and nine months ended May 31, 2024 and 2023.
__________________________________ (1) Unrealized holding gain (loss), net of foreign currency translation, less amounts reclassified are included in net unrealized gain (loss) on derivatives in the condensed consolidated statements of comprehensive income. (2) Gains included in net earnings are recorded in cost of goods sold in the condensed consolidated statements of earnings. There were no material non-recurring fair value remeasurements during the three or nine months ended May 31, 2024 or 2023. The carrying values of the Company's short-term items, including documentary letters of credit and notes payable, approximate fair value. The carrying value and fair value of the Company's long-term debt, including current maturities, excluding other borrowings and finance leases, was $1.0 billion and $932.3 million, respectively, at May 31, 2024, and $1.0 billion and $900.9 million, respectively, at August 31, 2023. The Company estimates these fair values based on Level 2 of the fair value hierarchy using indicated market values. The Company's other borrowings contain variable interest rates, and as a result, their carrying values approximate fair values.
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STOCK-BASED COMPENSATION PLANS |
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Share-Based Payment Arrangement [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation plans | NOTE 10. STOCK-BASED COMPENSATION PLANS The Company's stock-based compensation plans are described in Note 13, Stock-Based Compensation Plans, to the consolidated financial statements in the 2023 Form 10-K. In general, restricted stock units vest ratably over a period of three years. Subject to the achievement of performance targets established by the Compensation Committee of the Company's Board of Directors (the "Board"), performance stock units vest after a period of three years. Information for restricted stock units and performance stock units accounted for as equity awards during the nine months ended May 31, 2024 is as follows:
The Company granted 188,453 equivalent shares in the form of restricted stock units and performance stock units accounted for as liability awards during the nine months ended May 31, 2024. At May 31, 2024, the Company had outstanding 456,674 equivalent shares accounted for under the liability method. The Company expects 433,840 equivalent shares to vest. The following table summarizes total stock-based compensation expense, including fair value remeasurements, which was primarily included in SG&A expenses in the Company's condensed consolidated statements of earnings:
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STOCKHOLDERS EQUITY AND EARNINGS PER SHARE |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stockholder's equity and earnings per share | NOTE 11. STOCKHOLDERS' EQUITY AND EARNINGS PER SHARE The Company's calculation of basic earnings per share ("EPS") and diluted EPS are described in Note 16, Earnings Per Share, to the consolidated financial statements in the 2023 Form 10-K. The calculations of basic and diluted EPS were as follows:
For all periods presented above, the Company had immaterial anti-dilutive shares, which were not included in the computation of average diluted shares outstanding. In October 2021, the Board approved a share repurchase program under which the Company was authorized to repurchase up to $350.0 million of shares of CMC common stock. In January 2024, the Board authorized an increase of $500.0 million to the existing share repurchase program. During the three and nine months ended May 31, 2024, the Company repurchased 931,281 and 2,498,129 shares of CMC common stock, at an average purchase price of $55.64 and $51.30 per share, respectively. The Company had remaining authorization to repurchase $458.6 million of shares of CMC common stock at May 31, 2024.
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COMMITMENTS AND CONTINGENCIES |
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May 31, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and contingencies | NOTE 12. COMMITMENTS AND CONTINGENCIES In the ordinary course of conducting its business, the Company becomes involved in litigation, administrative proceedings and governmental investigations, including environmental matters, such as those described below. CMC expenses legal fees as they are incurred. Legal Proceeding On October 30, 2020, plaintiff Pacific Steel Group ("PSG") filed a suit in the United States District Court for the Northern District of California (the "Court") alleging that CMC, CMC Steel Fabricators, Inc. and CMC Steel US, LLC violated the federal and California state antitrust laws and California common law by entering into an exclusivity agreement for certain steel mill equipment manufactured by one of the Company’s equipment suppliers. PSG seeks, among other things, a jury trial on its claims in addition to injunctive relief, compensatory damages, fees and costs. Fact and expert discovery are complete. Both the motion for summary judgment filed by CMC, CMC Steel Fabricators, Inc. and CMC Steel US, LLC and the cross-motion for summary judgment filed by PSG were denied by the Court on June 10, 2024. A jury trial is scheduled for October 2024. The Company believes that it has substantial defenses and intends to vigorously defend against PSG's claims. The Company has not recorded any liability for this matter as it does not believe a loss is probable, and it cannot estimate any reasonably possible loss or range of possible loss. It is possible that an unfavorable resolution to this matter could have an adverse effect on the Company’s results of operations, financial position or cash flows. Other Matters At May 31, 2024 and August 31, 2023, the amounts accrued for cleanup and remediation costs at certain sites in response to the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 ("CERCLA") and analogous state and local statutes were immaterial. Total accrued environmental liabilities, including CERCLA sites, were $5.2 million and $4.5 million at May 31, 2024 and August 31, 2023, respectively, of which $2.0 million was classified as other noncurrent liabilities as of both May 31, 2024 and August 31, 2023. These amounts have not been discounted to their present values. Due to evolving remediation technology, changing regulations, possible third-party contributions, the inherent uncertainties of the estimation process and other factors, amounts accrued could vary significantly from amounts paid.
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BUSINESS SEGMENTS |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business segments | NOTE 13. SEGMENT INFORMATION The Company structures its business into three reportable segments: North America Steel Group, Europe Steel Group and Emerging Businesses Group. See Note 1, Nature of Operations and Accounting Policies, for more information about the reportable segments, including the types of products and services from which each reportable segment derives its net sales. Other revenue resulting from the Company's NMTC transactions are reflected in Corporate and Other net sales and are described in Note 9, New Markets Tax Credit Transactions, to the consolidated financial statements in the 2023 Form 10-K. In addition to other revenue from NMTC transactions, "Corporate and Other expenses" contains unallocated corporate amounts, such as earnings or losses resulting from the Company's Benefit Restoration Plan assets and liabilities and short-term investments, expenses of the Company's corporate headquarters, interest expense related to long-term debt and intercompany eliminations. Prior period balances in the tables below have been recast to reflect current period presentation, as described in Note 1, Nature of Operations and Accounting Policies. The following is a summary of certain financial information by reportable segment and Corporate and Other, as applicable:
The following table presents a reconciliation of net earnings to adjusted EBITDA from the reportable segments:
Disaggregation of Revenue The following tables display revenue by reportable segment and Corporate and Other from external customers, disaggregated by major product:
(1) Other revenue during the nine months ended May 31, 2023 includes $17.7 million derived from the Company's NMTC transactions. See Note 9, New Markets Tax Credit Transactions, to the consolidated financial statements in the 2023 Form 10-K for further information.
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Pay vs Performance Disclosure - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
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May 31, 2024 |
May 31, 2023 |
May 31, 2024 |
May 31, 2023 |
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Pay vs Performance Disclosure | ||||
Net earnings | $ 119,440 | $ 233,971 | $ 381,560 | $ 675,594 |
Insider Trading Arrangements |
3 Months Ended |
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May 31, 2024 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
NATURE OF OPERATIONS AND ACCOUNTING POLICIES (Policies) |
9 Months Ended |
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May 31, 2024 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") on a basis consistent with that used in the Annual Report on Form 10-K for the year ended August 31, 2023 (the "2023 Form 10-K") filed by Commercial Metals Company ("CMC," and together with its consolidated subsidiaries, the "Company") with the United States ("U.S.") Securities and Exchange Commission (the "SEC") and include all normal recurring adjustments necessary to present fairly the condensed consolidated balance sheets and the condensed consolidated statements of earnings, comprehensive income, cash flows and stockholders' equity for the periods indicated. These notes should be read in conjunction with the consolidated financial statements and notes included in the 2023 Form 10-K. The results of operations for the three and nine month periods ended May 31, 2024 are not necessarily indicative of the results to be expected for the full fiscal year. Any reference in this Form 10-Q to the "corresponding period" or "comparable period" relates to the relevant three or nine month period ended May 31, 2023. Any reference in this Form 10-Q to a year refers to the fiscal year ended August 31st of that year, unless otherwise noted.
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Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In November 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures ("ASU 2023-07"). ASU 2023-07 requires, among other updates, enhanced disclosures about significant segment expenses that are regularly provided to the CODM, as well as the aggregate amount of other segment items included in the reported measure of segment profit or loss. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, and requires retrospective adoption. Early adoption is permitted. The Company is evaluating the impact of this guidance on its consolidated financial statements and disclosures. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures ("ASU 2023-09"). ASU 2023-09 requires enhanced annual disclosures regarding the rate reconciliation and income taxes paid information. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024 and may be adopted on a prospective or retrospective basis. Early adoption is permitted. The Company is evaluating the impact of this guidance on its consolidated financial statements and disclosures.
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Fair value measurement | The Company has established a fair value hierarchy which prioritizes the inputs to the valuation techniques used to measure fair value into three levels. These levels are determined based on the lowest level input that is significant to the fair value measurement. Levels within the hierarchy are defined within Note 1, Nature of Operations and Summary of Significant Accounting Policies, to the consolidated financial statements in the 2023 Form 10-K.
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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables) |
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Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of accumulated other comprehensive income (loss) | The following tables reflect the changes in accumulated other comprehensive income (loss) ("AOCI"):
__________________________________ (1) Other comprehensive income (loss) ("OCI") before reclassifications from derivatives is presented net of income tax (expense) benefit of $6.9 million and $28.4 million for the three and nine months ended May 31, 2024, respectively, and $2.8 million and $(18.4) million for the three and nine months ended May 31, 2023, respectively. OCI before reclassifications from defined benefit pension plans is presented net of immaterial income tax impacts. (2) Reclassifications for (gains) losses from derivatives included in net earnings are primarily recorded in cost of goods sold in the condensed consolidated statements of earnings and are presented net of immaterial income tax impacts.
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REVENUE RECOGNITION (Tables) |
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May 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Information avout Assets and Liabilities from Contracts with Customers | The following table provides information about assets and liabilities from contracts with customers recognized over time:
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INVENTORIES, NET (Tables) |
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Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Inventory | The components of inventories were as follows:
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GOODWILL AND OTHER INTANGIBLES (Tables) |
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May 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Changes in the carrying amount of goodwill | Goodwill by reportable segment is detailed in the table below. During the first quarter of 2024, the Company changed its reportable segments as described in Note 1, Nature of Operations and Accounting Policies. Concurrent with the change in reportable segments, the Company reassigned goodwill to the updated reporting units using a relative fair value approach, shown below:
__________________________________ (1) Measurement period adjustments related to the 2023 acquisitions which impacted the amount of goodwill originally reported. The Company evaluated impairment indicators for the previous reporting units immediately prior to the change in reportable segments and concluded there were no indicators of impairment. Immediately after the change in reportable segments, the Company performed qualitative tests for five reporting units consisting of $285.0 million of goodwill and quantitative tests for three reporting units consisting of $100.8 million of goodwill. The results of the qualitative and quantitative tests indicated it was more likely than not that the fair value of all reporting units with goodwill exceeded their carrying values. Other indefinite-lived intangible assets consisted of the following:
The change in the balance of intangible assets with indefinite lives from August 31, 2023 to May 31, 2024 was due to foreign currency translation adjustments. Other intangible assets subject to amortization are detailed in the following table:
The foreign currency translation adjustments for intangible assets subject to amortization were immaterial for all periods presented above. Amortization expense for intangible assets was $7.1 million and $21.6 million in the three and nine months ended May 31, 2024, respectively, of which $4.5 million and $13.9 million, respectively, was recorded in cost of goods sold and the remainder was recorded in selling, general and administrative ("SG&A") expenses in the condensed consolidated statements of earnings. Amortization expense for intangible assets was $6.6 million and $18.9 million in the three and nine months ended May 31, 2023, respectively, of which $4.7 million and $14.0 million, respectively, was recorded in cost of goods sold and the remainder was recorded in SG&A expenses in the condensed consolidated statements of earnings. Estimated amounts of amortization expense for intangible assets for the next five years are as follows:
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CREDIT ARRANGEMENTS (Tables) |
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Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-term debt, including the deferred gain from the termination of the interest rate swaps | Long-term debt was as follows:
__________________________________ (1) The weighted average interest rate of short-term borrowings as of May 31, 2024 and August 31, 2023 was 6.800% and 7.800%, respectively.
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DERIVATIVES (Tables) |
3 Months Ended | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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May 31, 2024 |
May 31, 2024 |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commodity contract commitments | The following table provides information regarding the Company's commodity contract commitments at May 31, 2024:
__________________________________ MT = Metric ton MW(h) = Megawatt hour MMBtu = Metric Million British thermal unit
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Schedule of Derivatives Instruments Statements of Financial Performance and Financial Position, Location | The following table summarizes the location and amounts of the fair value of the Company's derivative instruments reported in the condensed consolidated balance sheets:
The decrease in fair value of the Company's commodity derivatives reported within other noncurrent assets is primarily due to the decrease in the value of a significant input used to measure the fair value of the Company's Level 3 commodity derivatives at May 31, 2024 as compared to August 31, 2023. See Note 9, Fair Value, for further discussion of the measurement of the fair value of the Company's Level 3 commodity derivatives.
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Derivative instruments, gain (loss) | The following table summarizes activities related to the Company's derivatives not designated as hedging instruments recognized in the condensed consolidated statements of earnings. All other activity related to the Company's derivatives not designated as hedging instruments was immaterial for the periods presented.
The following tables summarize activities related to the Company's derivatives designated as cash flow hedging instruments recognized in the condensed consolidated statements of comprehensive income and condensed consolidated statements of earnings. Amounts presented do not include the effects of foreign currency translation adjustments.
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FAIR VALUE (Tables) |
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Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial assets and financial liabilities measured at fair value on a recurring basis | The following table summarizes information regarding the Company's financial assets and financial liabilities that were measured at fair value on a recurring basis:
__________________________________ (1) Investment deposit accounts are short-term in nature, and the value is determined by principal plus interest. The investment portfolio mix can change each period based on the Company's assessment of investment options. (2) Derivative assets and liabilities classified as Level 1 are commodity futures contracts valued based on quoted market prices in the London Metal Exchange or New York Mercantile Exchange. Amounts in Level 2 are based on broker quotes in the over-the-counter market. Derivatives classified as Level 3 are described below. Further discussion regarding the Company's use of derivative instruments is included in Note 8, Derivatives. The fair value estimate of the Level 3 commodity derivatives are based on internally developed discounted cash flow models primarily utilizing unobservable inputs for which there is little or no market data. The Company forecasts future energy rates using a range of historical prices (the "floating rate"), which is the only significant unobservable input used in the Company's discounted cash flow models. Significantly higher or lower floating rates could have resulted in a material difference in the fair value measurement. The following table summarizes the range of floating rates used to measure the fair value of the Level 3 commodity derivatives at May 31, 2024 and August 31, 2023, which are applied uniformly across each of our Level 3 commodity derivatives:
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Fair value, net derivative asset (liability) measured on recurring basis, unobservable input reconciliation | Below is a reconciliation of the beginning and ending balances of the Level 3 commodity derivatives recognized in the condensed consolidated statements of comprehensive income. The fluctuation in energy rates over time causes volatility in the fair value estimates and is the primary reason for unrealized gains and losses included in OCI in the three and nine months ended May 31, 2024 and 2023.
__________________________________ (1) Unrealized holding gain (loss), net of foreign currency translation, less amounts reclassified are included in net unrealized gain (loss) on derivatives in the condensed consolidated statements of comprehensive income. (2) Gains included in net earnings are recorded in cost of goods sold in the condensed consolidated statements of earnings.
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STOCK-BASED COMPENSATION PLANS (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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May 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-Based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-Based Payment Arrangement, Restricted Stock Unit, Activity | Information for restricted stock units and performance stock units accounted for as equity awards during the nine months ended May 31, 2024 is as follows:
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Schedule of Stock-based Compensation Expense | The following table summarizes total stock-based compensation expense, including fair value remeasurements, which was primarily included in SG&A expenses in the Company's condensed consolidated statements of earnings:
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STOCKHOLDERS’ EQUITY AND EARNINGS PER SHARE (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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May 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Calculations of the basic and diluted earnings per share from continuing operations | The calculations of basic and diluted EPS were as follows:
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BUSINESS SEGMENTS (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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May 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of certain financial information from continuing operations by reportable segment | The following is a summary of certain financial information by reportable segment and Corporate and Other, as applicable:
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Reconciliations of earnings from continuing operations to adjusted operating profit | The following table presents a reconciliation of net earnings to adjusted EBITDA from the reportable segments:
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Net sales by major product | The following tables display revenue by reportable segment and Corporate and Other from external customers, disaggregated by major product:
(1) Other revenue during the nine months ended May 31, 2023 includes $17.7 million derived from the Company's NMTC transactions. See Note 9, New Markets Tax Credit Transactions, to the consolidated financial statements in the 2023 Form 10-K for further information.
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NATURE OF OPERATIONS AND ACCOUNTING POLICIES - Narrative (Details) |
9 Months Ended |
---|---|
May 31, 2024
segments
mill
| |
Accounting Policies [Abstract] | |
Number of reporting segments | segments | 3 |
Number of electric arc furnace mini mills | 6 |
Number of electric arc furnace micro mills | 3 |
Number of rerolling mills | 1 |
REVENUE RECOGNITION - Revenue Recognition Method (Details) - North America Steel Group - Recognized over Time |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
May 31, 2024 |
May 31, 2023 |
May 31, 2024 |
May 31, 2023 |
|
Fabricated Product and Installation Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Contract as percent of total segment revenue (percent) | 7.00% | 7.00% | 8.00% | 8.00% |
Fabricated Product without Installation Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Contract as percent of total segment revenue (percent) | 10.00% | 11.00% | 10.00% | 12.00% |
REVENUE RECOGNITION - Contract Assets and Contract Liabilities (Details) - USD ($) $ in Thousands |
May 31, 2024 |
Aug. 31, 2023 |
---|---|---|
Revenue from Contract with Customer [Abstract] | ||
Contract assets (included in other current assets) | $ 59,401 | $ 67,641 |
Contract liabilities (included in accrued expenses and other payables) | $ 31,496 | $ 28,377 |
INVENTORIES, NET (Details) - USD ($) $ in Thousands |
May 31, 2024 |
Aug. 31, 2023 |
---|---|---|
Inventory Disclosure [Abstract] | ||
Raw materials | $ 278,118 | $ 261,619 |
Work in process | 5,315 | 6,844 |
Finished goods | 791,743 | 767,119 |
Total | $ 1,075,176 | $ 1,035,582 |
INVENTORIES, NET - Narrative (Details) - USD ($) $ in Thousands |
9 Months Ended | |
---|---|---|
May 31, 2024 |
May 31, 2023 |
|
Inventory Disclosure [Abstract] | ||
Write-down of inventory | $ 6,586 | $ 8,931 |
GOODWILL AND OTHER INTANGIBLES - Schedule of Indefinite Lived Assets (Details) - USD ($) $ in Thousands |
May 31, 2024 |
Aug. 31, 2023 |
---|---|---|
Indefinite-Lived Intangible Assets [Line Items] | ||
Indefinite-Lived Intangible Assets (Excluding Goodwill) | $ 57,269 | $ 57,206 |
Trade names | ||
Indefinite-Lived Intangible Assets [Line Items] | ||
Indefinite-Lived Intangible Assets (Excluding Goodwill) | 54,119 | 54,056 |
In Process Research and Development | ||
Indefinite-Lived Intangible Assets [Line Items] | ||
Indefinite-Lived Intangible Assets (Excluding Goodwill) | 2,400 | 2,400 |
Non-compete agreements | ||
Indefinite-Lived Intangible Assets [Line Items] | ||
Indefinite-Lived Intangible Assets (Excluding Goodwill) | $ 750 | $ 750 |
GOODWILL AND OTHER INTANGIBLES (Narrative) (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
May 31, 2024 |
May 31, 2023 |
May 31, 2024 |
May 31, 2023 |
|
Business Acquisition [Line Items] | ||||
Goodwill Subject To Qualitive Testing | $ 285.0 | $ 285.0 | ||
Goodwill Subject To Quantitative Testing | 100.8 | 100.8 | ||
Amortization | 7.1 | $ 6.6 | 21.6 | $ 18.9 |
Amortization in cost of goods sold | $ 4.5 | $ 4.7 | $ 13.9 | $ 14.0 |
GOODWILL AND OTHER INTANGIBLES - Schedule of Finite-Lived Intangible Assets Estimated Remaining Amortization Expense (Details) $ in Thousands |
May 31, 2024
USD ($)
|
---|---|
Goodwill and Intangible Assets Disclosure [Abstract] | |
Remainder of 2024 | $ 6,782 |
2025 | 26,644 |
2026 | 25,420 |
2027 | 25,323 |
2028 | $ 23,596 |
DERIVATIVES (Narrative) (Details) - USD ($) $ in Millions |
9 Months Ended | |
---|---|---|
May 31, 2024 |
Aug. 31, 2023 |
|
Derivative [Line Items] | ||
Cash flow hedging instruments expected to be reclassified into earnings within the next twelve months | $ 6.3 | |
Foreign exchange | ||
Derivative [Line Items] | ||
Derivative notional amount | 195.2 | $ 221.4 |
Commodity | ||
Derivative [Line Items] | ||
Derivative notional amount | $ 510.4 | $ 456.4 |
DERIVATIVES (Commodity Contract Commitments) (Details) MWh in Thousands |
9 Months Ended |
---|---|
May 31, 2024
MWh
MMBTU
t
| |
Aluminum | Long | |
Derivative [Line Items] | |
Commodity contract commitments | 3,350 |
Aluminum | Short | |
Derivative [Line Items] | |
Commodity contract commitments | 1,525 |
Copper | Long | |
Derivative [Line Items] | |
Commodity contract commitments | 771 |
Copper | Short | |
Derivative [Line Items] | |
Commodity contract commitments | 11,385 |
Electricity | Long | |
Derivative [Line Items] | |
Commodity contract commitment, energy | MWh | 3,153 |
Natural Gas | Long | |
Derivative [Line Items] | |
Commodity contract commitment, energy | MMBTU | 5,210,650 |
Fair Value (Reconciliation of Commodity Derivative Recognized in Other Comprehensive Income) (Details) - Commodity - Significant Unobservable Inputs (Level 3) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
May 31, 2024 |
May 31, 2023 |
May 31, 2024 |
May 31, 2023 |
|
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning balance | $ 86,317 | $ 280,842 | $ 194,425 | $ 143,500 |
Unrealized holding gain before reclassification | (35,907) | 1,526 | (139,665) | 145,808 |
Reclassification for gain included in net earnings | (1,298) | (2,083) | (5,648) | (9,023) |
Ending balance | $ 49,112 | $ 280,285 | $ 49,112 | $ 280,285 |
FAIR VALUE - Narrative (Details) - USD ($) $ in Millions |
May 31, 2024 |
Aug. 31, 2023 |
---|---|---|
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-Term Debt | $ 1,000.0 | $ 1,000.0 |
Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-Term Debt | $ 932.3 | $ 900.9 |
STOCK-BASED COMPENSATION PLANS (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
May 31, 2024 |
May 31, 2022 |
May 31, 2024 |
May 31, 2023 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period in years | 3 years | |||
Stock-based compensation | $ 12,846 | $ 10,376 | $ 35,893 | $ 44,000 |
Liability method awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares granted | 188,453 | |||
Equivalent shares outstanding | 456,674 | 456,674 | ||
Equivalent shares expected to vest | 433,840 | 433,840 |
STOCK-BASED COMPENSATION PLANS - Restricted Stock Unit Activity (Details) - Restricted Stock Units (RSUs) |
9 Months Ended |
---|---|
May 31, 2024
$ / shares
shares
| |
Shares | |
Beginning balance (in shares) | shares | 1,777,591 |
Granted (in shares) | shares | 1,082,858 |
Vested (in shares) | shares | (1,255,826) |
Forfeited (in shares) | shares | (41,865) |
Ending balance (in shares) | shares | 1,562,758 |
Weighted Average Fair Value | |
Beginning balance (in dollars per share) | $ / shares | $ 37.01 |
Granted (in dollars per share) | $ / shares | 47.72 |
Vested (in dollars per share) | $ / shares | 38.03 |
Forfeited (in dollars per share) | $ / shares | 41.32 |
Ending balance (in dollars per share) | $ / shares | $ 43.51 |
STOCKHOLDERS EQUITY AND EARNINGS PER SHARE (Calculations of the Basic and Diluted Earnings Per Share) (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
May 31, 2024 |
May 31, 2023 |
May 31, 2024 |
May 31, 2023 |
|
Earnings Per Share [Abstract] | ||||
Net earnings | $ 119,440 | $ 233,971 | $ 381,560 | $ 675,594 |
Average basic shares outstanding (shares) | 115,529,942 | 117,066,623 | 116,228,826 | 117,192,710 |
Effect of dilutive securities (shares) | 1,134,943 | 1,331,276 | 1,354,229 | 1,554,374 |
Average diluted shares outstanding (shares) | 116,664,885 | 118,397,899 | 117,583,055 | 118,747,084 |
Earnings per share: | ||||
Basic (in USD per share) | $ 1.03 | $ 2.00 | $ 3.28 | $ 5.76 |
Diluted (in USD per share) | $ 1.02 | $ 1.98 | $ 3.25 | $ 5.69 |
STOCKHOLDERS EQUITY AND EARNINGS PER SHARE (Narrative) (Details) - USD ($) |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
May 31, 2024 |
May 31, 2024 |
Jan. 31, 2024 |
Oct. 31, 2021 |
|
Earnings Per Share [Abstract] | ||||
Stock repurchase program, authorized amount | $ 350,000,000 | |||
Stock repurchase program, authorized increase | $ 500,000,000 | |||
Treasury stock acquired, shares | 931,281 | 2,498,129 | ||
Treasury stock acquired (in dollars per share) | $ 55.64 | $ 51.30 | ||
Stock repurchase program, remaining authorized repurchase amount | $ 458,600,000 | $ 458,600,000 |
COMMITMENTS AND CONTINGENCIES (Narrative) (Details) - CERCLA sites - USD ($) $ in Millions |
May 31, 2024 |
Aug. 31, 2023 |
---|---|---|
Loss Contingencies [Line Items] | ||
Accrual for environmental loss contingencies | $ 5.2 | $ 4.5 |
Accrued environmental loss contingencies, noncurrent | $ 2.0 |
BUSINESS SEGMENTS (Narrative) (Details) |
9 Months Ended |
---|---|
May 31, 2024
segments
| |
Segment Reporting [Abstract] | |
Number of reporting segments | 3 |
BUSINESS SEGMENTS (Reconciliations of Earnings from Continuing Operations to Adjusted Operating Profit) (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
May 31, 2024 |
May 31, 2023 |
May 31, 2024 |
May 31, 2023 |
|
Segment Reporting [Abstract] | ||||
Net earnings | $ 119,440 | $ 233,971 | ||
Interest expense | 12,117 | 8,878 | $ 35,751 | $ 31,868 |
Income taxes | 40,867 | 76,099 | 120,361 | 208,465 |
Depreciation and amortization | 70,692 | 55,129 | 208,177 | 157,528 |
Asset impairments | 146 | 1 | 150 | 46 |
Corporate and Other expenses | 37,070 | 37,715 | 102,569 | 93,013 |
Adjusted EBITDA reportable segments | $ 280,332 | $ 411,793 | 848,568 | 1,166,514 |
Settlement of New markets Tax Credit transaction | $ 0 | $ 17,659 |
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