Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Nov. 30, 2022 | Dec. 30, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Nov. 30, 2022 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q2 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Trading Symbol | WOR | |
Entity Registrant Name | WORTHINGTON INDUSTRIES, INC | |
Entity Central Index Key | 0000108516 | |
Current Fiscal Year End Date | --05-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Incorporation, State or Country Code | OH | |
Entity Shell Company | false | |
Entity File Number | 001-08399 | |
Entity Tax Identification Number | 31-1189815 | |
Entity Address, Address Line One | 200 Old Wilson Bridge Road | |
Entity Address, City or Town | Columbus | |
Entity Address, State or Province | OH | |
Entity Address, Postal Zip Code | 43085 | |
City Area Code | 614 | |
Local Phone Number | 438-3210 | |
Entity Common Stock, Shares Outstanding | 49,707,649 | |
Title of 12(b) Security | Common Shares, Without Par Value | |
Security Exchange Name | NYSE |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Nov. 30, 2022 | May 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 129,596 | $ 34,485 |
Receivables, less allowances of $2,679 and $1,292 at November 30, 2022 and May 31, 2022, respectively | 694,668 | 857,493 |
Inventories: | ||
Raw materials | 304,692 | 323,609 |
Work in process | 159,772 | 255,019 |
Finished products | 190,160 | 180,512 |
Total inventories | 654,624 | 759,140 |
Income taxes receivable | 19,834 | 20,556 |
Assets held for sale | 5,191 | 20,318 |
Prepaid expenses and other current assets | 98,873 | 93,661 |
Total current assets | 1,602,786 | 1,785,653 |
Investments in unconsolidated affiliates | 240,859 | 327,381 |
Operating lease assets | 103,488 | 98,769 |
Goodwill | 412,971 | 401,469 |
Other intangible assets, net of accumulated amortization of $102,561 and $93,973 at November 30, 2022 and May 31, 2022, respectively | 322,934 | 299,017 |
Other assets | 25,439 | 34,394 |
Property, plant and equipment: | ||
Land | 49,644 | 51,483 |
Buildings and improvements | 302,999 | 303,269 |
Machinery and equipment | 1,223,841 | 1,196,806 |
Construction in progress | 60,673 | 59,363 |
Total property, plant and equipment | 1,637,157 | 1,610,921 |
Less: accumulated depreciation | 954,974 | 914,581 |
Total property, plant and equipment, net | 682,183 | 696,340 |
Total assets | 3,390,660 | 3,643,023 |
Current liabilities: | ||
Accounts payable | 481,273 | 668,438 |
Short-term borrowings | 4,935 | 47,997 |
Accrued compensation, contributions to employee benefit plans and related taxes | 86,998 | 117,530 |
Dividends payable | 17,663 | 15,988 |
Other accrued items | 58,046 | 70,125 |
Current operating lease liabilities | 11,719 | 11,618 |
Income taxes payable | 300 | |
Current maturities of long-term debt | 257 | 265 |
Total current liabilities | 660,891 | 932,261 |
Other liabilities | 115,688 | 115,991 |
Distributions in excess of investment in unconsolidated affiliate | 91,643 | 81,149 |
Long-term debt | 693,453 | 696,345 |
Noncurrent operating lease liabilities | 93,513 | 88,183 |
Deferred income taxes, net | 96,180 | 115,132 |
Total liabilities | 1,751,368 | 2,029,061 |
Shareholders' equity - controlling interest | 1,513,393 | 1,480,752 |
Noncontrolling interests | 125,899 | 133,210 |
Total equity | 1,639,292 | 1,613,962 |
Total liabilities and equity | $ 3,390,660 | $ 3,643,023 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Nov. 30, 2022 | May 31, 2022 |
Statement of Financial Position [Abstract] | ||
Receivables, allowances | $ 2,679 | $ 1,292 |
Other intangible assets, accumulated amortization | $ 102,561 | $ 93,973 |
Consolidated Statements of Earn
Consolidated Statements of Earnings - USD ($) shares in Thousands | 3 Months Ended | 6 Months Ended | ||
Nov. 30, 2022 | Nov. 30, 2021 | Nov. 30, 2022 | Nov. 30, 2021 | |
Income Statement [Abstract] | ||||
Net sales | $ 1,175,541,000 | $ 1,232,861,000 | $ 2,584,206,000 | $ 2,343,679,000 |
Cost of goods sold | 1,069,778,000 | 1,048,270,000 | 2,309,069,000 | 1,939,714,000 |
Gross margin | 105,763,000 | 184,591,000 | 275,137,000 | 403,965,000 |
Selling, general and administrative expense | 107,813,000 | 96,130,000 | 211,261,000 | 191,981,000 |
Impairment of long-lived assets | 312,000 | |||
Restructuring and other income, net | (4,282,000) | (2,004,000) | (5,382,000) | (14,278,000) |
Separation costs | 9,246,000 | 9,246,000 | ||
Operating income (loss) | (7,014,000) | 90,465,000 | 59,700,000 | 226,262,000 |
Other income (expense): | ||||
Miscellaneous income (expense), net | 1,405,000 | 1,040,000 | (3,681,000) | 1,670,000 |
Interest expense | (7,612,000) | (7,312,000) | (16,210,000) | (15,030,000) |
Equity in net income of unconsolidated affiliates | 36,857,000 | 60,218,000 | 68,569,000 | 113,134,000 |
Earnings before income taxes | 23,636,000 | 144,411,000 | 108,378,000 | 326,036,000 |
Income tax expense | 4,131,000 | 31,226,000 | 23,629,000 | 71,376,000 |
Net earnings | 19,505,000 | 113,185,000 | 84,749,000 | 254,660,000 |
Net earnings attributable to noncontrolling interests | 3,287,000 | 2,884,000 | 4,449,000 | 11,868,000 |
Net earnings attributable to controlling interest | $ 16,218,000 | $ 110,301,000 | $ 80,300,000 | $ 242,792,000 |
Basic | ||||
Weighted average common shares outstanding | 48,558 | 50,381 | 48,518 | 50,618 |
Earnings per share attributable to controlling interest | $ 0.33 | $ 2.19 | $ 1.66 | $ 4.80 |
Diluted | ||||
Weighted average common shares outstanding | 49,330 | 51,214 | 49,293 | 51,532 |
Earnings per share attributable to controlling interest | $ 0.33 | $ 2.15 | $ 1.63 | $ 4.71 |
Common shares outstanding at end of period | 48,572 | 50,334 | 48,572 | 50,334 |
Cash dividends declared per share | $ 0.31 | $ 0.28 | $ 0.62 | $ 0.56 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Nov. 30, 2022 | Nov. 30, 2021 | Nov. 30, 2022 | Nov. 30, 2021 | |
Statement of Comprehensive Income [Abstract] | ||||
Net earnings | $ 19,505 | $ 113,185 | $ 84,749 | $ 254,660 |
Other comprehensive income (loss) | ||||
Foreign currency translation, net of tax | 858 | (4,872) | (9,243) | (8,847) |
Pension liability adjustment, net of tax | (82) | 2,857 | ||
Cash flow hedges, net of tax | (4,000) | (52,986) | (17,300) | (53,285) |
Other comprehensive income (loss) | (3,224) | (57,858) | (23,686) | (62,132) |
Comprehensive income | 16,281 | 55,327 | 61,063 | 192,528 |
Comprehensive income attributable to noncontrolling interests | 3,287 | 2,884 | 4,449 | 11,868 |
Comprehensive income attributable to controlling interest | $ 12,994 | $ 52,443 | $ 56,614 | $ 180,660 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Nov. 30, 2022 | Nov. 30, 2021 | Nov. 30, 2022 | Nov. 30, 2021 | |
Operating activities: | ||||
Net earnings | $ 19,505 | $ 113,185 | $ 84,749 | $ 254,660 |
Adjustments to reconcile net earnings to net cash provided (used) by operating activities: | ||||
Depreciation and amortization | 28,354 | 21,090 | 56,355 | 43,154 |
Impairment of long-lived assets | 312 | |||
Provision for (benefit from) deferred income taxes | (3,617) | 1,309 | (14,673) | 2,675 |
Bad debt expense | 1,098 | 335 | 1,440 | 514 |
Equity in net income of unconsolidated affiliates, net of distributions | 18,352 | (31,274) | 61,197 | (64,492) |
Net gain on sale of assets | (4,265) | (496) | (5,034) | (13,202) |
Stock-based compensation | 4,547 | 4,248 | 8,783 | 7,551 |
Changes in assets and liabilities, net of impact of acquisitions: | ||||
Receivables | 119,674 | (89,817) | 157,093 | (121,685) |
Inventories | 72,293 | (97,182) | 113,460 | (260,864) |
Accounts payable | (100,535) | (47,594) | (202,116) | (926) |
Accrued compensation and employee benefits | 3,336 | 14,358 | (30,532) | (31,819) |
Income taxes payable | (7,629) | (22,922) | (300) | 12,935 |
Other operating items, net | (18,172) | 15,656 | (16,755) | 2,583 |
Net cash provided (used) by operating activities | 132,941 | (119,104) | 213,979 | (168,916) |
Investing activities: | ||||
Investment in property, plant and equipment | (24,490) | (24,234) | (45,967) | (48,159) |
Investment in non-marketable equity securities | (140) | (250) | ||
Acquisitions, net of cash acquired | (3,000) | (56,088) | (107,750) | |
Proceeds from sale of investment in ArtiFlex | 36,095 | |||
Proceeds from sale of assets, net of selling costs | 23,739 | 5,136 | 35,494 | 31,821 |
Net cash used by investing activities | (891) | (22,098) | (30,716) | (124,088) |
Financing activities: | ||||
Net repayments of short-term borrowings | (10,619) | (43,062) | ||
Principal payments on long-term obligations | (13) | (10) | (150) | (402) |
Payments for issuance of common shares, net of tax withholdings | (649) | (2,694) | (4,115) | (6,785) |
Payments to noncontrolling interests | (11,760) | (2,879) | (11,760) | (12,076) |
Repurchase of common shares | (12,702) | (73,587) | ||
Dividends paid | (15,181) | (14,565) | (29,065) | (29,263) |
Net cash used by financing activities | (38,222) | (32,850) | (88,152) | (122,113) |
Increase (decrease) in cash and cash equivalents | 93,828 | (174,052) | 95,111 | (415,117) |
Cash and cash equivalents at beginning of period | 35,768 | 399,246 | 34,485 | 640,311 |
Cash and cash equivalents at end of period | $ 129,596 | $ 225,194 | $ 129,596 | $ 225,194 |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Nov. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Note A – Basis of Presentation Basis of Presentation The consolidated financial statements include the accounts of Worthington Industries, Inc. and consolidated subsidiaries (collectively, “we,” “our,” “Worthington,” or the “Company”). Investments in unconsolidated affiliates are accounted for using the equity method. Significant intercompany accounts and transactions have been eliminated. We own controlling interests in the following three operating joint ventures: Spartan Steel Coating, L.L.C. (“Spartan”) ( 52 %); TWB Company, L.L.C. (“TWB”) ( 55 %); and Worthington Samuel Coil Processing LLC (“Samuel” or “Samuel joint venture”) ( 63 %). The last remaining manufacturing facility of our Worthington Specialty Processing (“WSP”) joint venture was sold in the second quarter of fiscal 2022. See “Note F – Restructuring and Other Income, Net” for additional information. These joint ventures are consolidated with the equity owned by the other joint venture members shown as “Noncontrolling interests” in our consolidated balance sheets, and the other joint venture members’ portions of net earnings and other comprehensive income (loss) (“OCI”) shown as net earnings or comprehensive income attributable to noncontrolling interests in our consolidated statements of earnings and consolidated statements of comprehensive income, respectively. Investments in unconsolidated affiliates are accounted for using the equity method. See further discussion of our unconsolidated affiliates in “ Note D – Investments in Unconsolidated Affiliates.” These unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the U.S. for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X of the SEC. Accordingly, they do not include all of the information and notes required by accounting principles generally accepted in the U.S. (“U.S. GAAP”) for complete financial statements. In the opinion of management, all adjustments, which are of a normal and recurring nature except those which have been disclosed elsewhere in this Form 10-Q, necessary for a fair presentation of the consolidated financial statements for these interim periods, have been included. Operating results for the three months and the six months ended November 30, 2022 are not necessarily indicative of the results that may be expected for the fiscal year ending May 31, 2023 (“fiscal 2023”). For further information, refer to the consolidated financial statements and notes thereto included in the Annual Report on Form 10-K for the fiscal year ended May 31, 2022 (“fiscal 2022”) of Worthington Industries, Inc. (the “2022 Form 10-K”). The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. Steel Processing Separation On September 29, 2022, the Company announced that the Board of Directors of Worthington Industries, Inc. approved a plan to pursue a separation into two independent, publicly-traded companies – one company is expected to be comprised of the Company’s Steel Processing operating segment, and the other company is expected to be comprised of the Company’s Consumer Products, Building Products and Sustainable Energy Solutions operating segments. The Company plans to effect the separation via a distribution of stock of the Steel Processing business, which is expected to be tax-free to shareholders for U.S. federal income tax purposes. The Separation transaction is expected to be completed by early 2024, but is subject to certain conditions, including, among other things, general market conditions, finalization of the capital structure of the two companies, completion of steps necessary to qualify the Separation as a tax-free transaction, receipt of regulatory approvals and final approval from the Board of Directors of Worthington Industries, Inc. Direct and incremental costs incurred in connection with the anticipated Separation, including audit, advisory, and legal costs, are presented separately in our consolidated statements of earnings as “Separation costs”. Separation costs totaled $ 9,246,000 during the three and six months ended November 30, 2022. |
Inventory
Inventory | 6 Months Ended |
Nov. 30, 2022 | |
Inventory Disclosure [Abstract] | |
Inventory | Note B – Inventory Due to a decline in steel pricing during the first quarter of fiscal 2023, the net realizable value of our inventory was lower than the cost reflected in our records at August 31, 2022. Accordingly, we recorded a lower of cost or net realizable value adjustment during the first quarter of fiscal 2023 totaling $ 4,488,000 to reflect this lower value. The entire amount of the adjustment was attributed to our Steel Processing operating segment and was recorded in cost of goods sold in the consolidated statement of earnings for the three months ended August 31, 2022. There was no lower of cost or net realizable value adjustment to inventory during the three months ended November 30, 2022. |
Revenue Recognition
Revenue Recognition | 6 Months Ended |
Nov. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Note C – Revenue Recognition The following table summarizes net sales by operating segment and product class for the periods presented: Three Months Ended Six Months Ended November 30, November 30, (in thousands) 2022 2021 2022 2021 Steel Processing Direct $ 807,259 $ 900,666 $ 1,809,394 $ 1,688,694 Toll 34,688 37,176 71,433 71,958 Total 841,947 937,842 1,880,827 1,760,652 Consumer Products (1) 153,795 140,793 342,497 288,576 Building Products (1) 141,671 121,125 291,994 235,868 Sustainable Energy Solutions (1) 38,128 33,101 68,888 58,583 Total $ 1,175,541 $ 1,232,861 $ 2,584,206 $ 2,343,679 (1) The products contained within each of these operating segments have similar production processes, require substantially the same raw materials, use similar equipment, and serve similar purposes. Therefore, we believe the products within each of these segments are appropriately combined for purposes of the disclosure requirements prescribed by Accounting Standards Codification (“ASC”) Topic 280 and Topic 606. The following table summarizes the over time revenue for the periods presented: Three Months Ended Six Months Ended November 30, November 30, (in thousands) 2022 2021 2022 2021 Steel Processing - toll $ 34,688 $ 37,176 $ 71,433 $ 71,958 The following table summarizes the unbilled receivables at the dates indicated: November 30, May 31, (in thousands) Balance Sheet Classification 2022 2022 Unbilled receivables Receivables $ 3,192 $ 5,001 There were no contract assets at November 30, 2022 or May 31, 2022. We have elected the optional exemption, which allows for the exclusion of the amounts for remaining performance obligations that are a part of contracts with an expected duration of one year or less. As of November 30, 2022 , there were no unsatisfied or partially satisfied performance obligations related to contracts with an expected duration greater than one year. |
Investments in Unconsolidated A
Investments in Unconsolidated Affiliates | 6 Months Ended |
Nov. 30, 2022 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investments in Unconsolidated Affiliates | Note D – Investments in Unconsolidated Affiliates Investments in affiliated companies that we do not control, either through majority ownership or otherwise, are accounted for using the equity method. At November 30, 2022 , we held noncontrolling investments in the following affiliated companies: Clarkwestern Dietrich Building Systems LLC (“ClarkDietrich”) ( 25 %); Serviacero Planos, S. de R. L. de C.V. (“Serviacero Worthington”) ( 50 %); Taxi Workhorse Holdings, LLC (“Workhorse”) ( 20 %); and Worthington Armstrong Venture (“WAVE”) ( 50 %). On August 3, 2022, the Company sold its 50 % noncontrolling equity interest in ArtiFlex Manufacturing, LLC (“ArtiFlex”) to the unaffiliated joint venture member for approximately $ 42,086,000 , after adjustments for closing debt and final net working capital. Approximately $ 6,000,000 of the total cash proceeds were attributed to real property in Wooster, Ohio, with a net book value of approximately $ 6,300,000 . This real property was owned by Worthington and leased to ArtiFlex prior to closing of the transaction. The Company recognized a pre-tax loss of approximately $ 15,759,000 in equity income related to the sale of its 50 % noncontrolling equity interest portion of the transaction. We received distributions from unconsolidated affiliates totaling $ 129,766,000 during the six months ended November 30, 2022. We have received cumulative distributions from WAVE in excess of our investment balance amounting to $ 91,643,000 , which is shown as a separate liability on our consolidated balance sheet at November 30, 2022. In accordance with the applicable accounting guidance, we have reclassified the negative investment balance to the liabilities section of our consolidated balance sheets. We will continue to record our equity in the net income of WAVE as a debit to the investment account, and if the investment balance becomes positive, it will again be shown as an asset on our consolidated balance sheets. If it becomes probable that any excess distribution may not be returned (upon joint venture liquidation or otherwise), we will recognize any negative investment balance classified as a liability as income immediately. We use the “cumulative earnings” approach for determining cash flow presentation of distributions from our unconsolidated joint ventures. Distributions received are included in our consolidated statements of cash flows as operating activities, unless the cumulative distributions received, less distributions received in prior periods that were determined to be returns of investment, exceed our portion of the cumulative equity in the net earnings of the joint venture, in which case the excess distributions are deemed to be returns of the investment and are classified as investing activities in our consolidated statements of cash flows. The following tables summarize combined financial information for our unconsolidated affiliates as of the dates, and for the periods presented: November 30, May 31, (in thousands) 2022 2022 Cash and cash equivalents $ 41,768 $ 68,563 Other current assets 911,881 1,148,029 Noncurrent assets 301,027 369,608 Total assets $ 1,254,676 $ 1,586,200 Current liabilities 292,303 345,097 Short-term borrowings 10,000 5,943 Current maturities of long-term debt 36,110 33,054 Long-term debt 304,108 306,814 Other noncurrent liabilities 69,667 76,437 Equity 542,488 818,855 Total liabilities and equity $ 1,254,676 $ 1,586,200 Three Months Ended Six Months Ended November 30, November 30, (in thousands) 2022 2021 2022 2021 Net sales $ 711,665 $ 858,165 $ 1,535,607 $ 1,603,160 Gross margin 147,299 226,502 328,704 416,176 Operating income 107,356 184,779 245,183 330,767 Depreciation and amortization 6,864 7,848 15,052 16,075 Interest expense 3,910 2,711 6,590 5,172 Income tax expense 1,262 8,565 3,372 16,461 Net earnings 105,183 173,915 238,421 312,803 |
Impairment of Long-Lived Assets
Impairment of Long-Lived Assets | 6 Months Ended |
Nov. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Impairment of Long-Lived Assets | Note E – Impairment of Long-Lived Assets Impairment of Long-Lived Assets Fiscal 2023 : During the first quarter of fiscal 2023, we committed to plans to liquidate certain fixed assets at our Samuel joint venture’s toll processing facility in Cleveland, Ohio. As all of the criteria for classification as assets held for sale continue to be met during the quarter ended November 30, 2022, the net assets have been presented separately as assets held for sale in our consolidated balance sheet as of November 30, 2022 . In accordance with the applicable accounting guidance, the net assets were recorded at the lower of net book value or fair market value less costs to sell. As a result, a pre-tax impairment charge of $ 312,000 was recognized during the first quarter of fiscal 2023 to write the book value of the land and building of the asset group to its estimated fair value less cost to sell. The land and building were subsequently sold during the second quarter of fiscal 2023 for net cash proceeds of $ 3,298,000 . Machinery and equipment with a net book value of $ 1,562,000 continues to be classified as held for sale. No impairment charges were recorded during the second quarter of fiscal 2023. Fiscal 2022 : No ne |
Restructuring and Other Income,
Restructuring and Other Income, Net | 6 Months Ended |
Nov. 30, 2022 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Other Income, Net | Note F – Restructuring and Other Income, Net We consider restructuring activities to be programs whereby we fundamentally change our operations, such as closing and consolidating manufacturing facilities or moving manufacturing of a product to another location. Restructuring activities may also involve substantial realignment of the management structure of a business unit in response to changing market conditions. A progression of the liabilities associated with our restructuring activities, combined with a reconciliation to the restructuring and other income, net financial statement caption, in our consolidated statement of earnings for the six months ended November 30, 2022 is summarized below: (in thousands) Balance, as of Expense Payments Adjustments Balance, as of Early retirement and severance $ 541 $ 85 $ ( 605 ) $ - $ 21 Net gain on sale of assets (1)(2) ( 5,467 ) Restructuring and other income, net $ ( 5,382 ) (1) On June 14, 2022, we sold real property in Tulsa, Oklahoma, for net cash proceeds of $ 5,775,000 , resulting in a pre-tax gain of $ 1,177,000 . These assets had been excluded from the sale of our former oil & gas equipment business in January 2021. The assets were classified in assets held for sale on the consolidated balance sheets immediately prior to the closing of the sale. (2) On October 31, 2022, the Company’s consolidated steel processing joint venture, WSP, sold its remaining manufacturing facility, located in Jackson, Michigan. Net proceeds of $ 21,277,000 were realized in connection with the transaction, of which $ 2,000,000 is being held in escrow for general representations and warranties. The transaction resulted in a pre-tax gain of $ 3,926,000 . The assets were classified in assets held for sale on the consolidated balance sheets immediately prior to the closing of the sale. The total liability associated with our restructuring activities as of November 30, 2022 is expected to be paid in the next twelve months. |
Contingent Liabilities and Comm
Contingent Liabilities and Commitments | 6 Months Ended |
Nov. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingent Liabilities and Commitments | Note G – Contingent Liabilities and Commitments Legal Proceedings We are defendants in certain legal actions. In the opinion of management, the outcome of these actions, which is not clearly determinable at the present time, would not significantly affect our consolidated financial position or future results of operations. We also believe that environmental issues will not have a material effect on our capital expenditures, consolidated financial position or future results of operations. |
Guarantees
Guarantees | 6 Months Ended |
Nov. 30, 2022 | |
Guarantees and Product Warranties [Abstract] | |
Guarantees | Note H – Guarantees We do not have guarantees that we believe are reasonably likely to have a material current or future effect on our consolidated financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources. However, we had in place $ 14,137,000 of outstanding stand-by letters of credit issued to third-party service providers at November 30, 2022 . No amounts were drawn against these stand-by letters of credit at November 30, 2022 . We are also party to an operating lease for an aircraft in which we have guaranteed a residual value at lease termination. The maximum obligation under the terms of this guarantee was approximately $ 17,524,000 at November 30, 2022. |
Debt
Debt | 6 Months Ended |
Nov. 30, 2022 | |
Debt Disclosure [Abstract] | |
Debt | Note I – Debt We maintain a $ 500,000,000 multi-year revolving credit facility (the “Credit Facility”) with a group of lenders. On August 20, 2021, we amended and restated the Credit Facility, extending the final maturity from February 16, 2023 to August 20, 2026 while keeping in place the $500,000,000 aggregate commitments under the Credit Facility. Borrowings under the Credit Facility have maturities of up to one year . We have the option to borrow at rates equal to an applicable margin over the Daily LIBOR Rate, the Prime Rate of PNC Bank, National Association or the Overnight Bank Funding Rate. The Credit Facility contains customary LIBOR benchmark replacement language. The applicable margin is determined by our credit rating. There were no borrowings outstanding under the Credit Facility at November 30, 2022 , leaving $ 500,000,000 available for future use. We also maintain a revolving trade accounts receivable securitization facility (the “AR Facility”). Pursuant to the terms of the AR Facility, certain of our subsidiaries sell or contribute all of their eligible accounts receivable and other related assets without recourse, on a revolving basis, to Worthington Receivables Company, LLC (“WRC”), a wholly-owned, consolidated, bankruptcy-remote indirect subsidiary. In turn, WRC sells, on a revolving basis, up to $ 175,000,000 of undivided ownership interests in this pool of accounts receivable to a third-party bank. We retain an undivided interest in this pool and are subject to risk of loss based on the collectability of the receivables from this retained interest. Because the amount eligible to be sold excludes receivables more than 120 days past due, receivables offset by an allowance for doubtful accounts due to bankruptcy or other cause, concentrations over certain limits with specific customers and certain reserve amounts, we believe additional risk of loss is minimal. As of November 30, 2022 , there were no borrowings outstanding under the AR Facility, leaving $ 175,000,000 available for future use. Tempel China has short-term loan facilities that result in the equivalent of $ 4,935,000 U.S. dollars outstanding at November 30, 2022. These loans, which are used to finance steel purchases, are collateralized by Tempel China property and equipment and mature in 2023 . New loans may be entered into as these loans mature. The effective interest rate on these loans is 3.5 % at November 30, 2022. |
Other Comprehensive Income (Los
Other Comprehensive Income (Loss) | 6 Months Ended |
Nov. 30, 2022 | |
Components Of Other Comprehensive Income Loss [Abstract] | |
Other Comprehensive Income (Loss) | Note J – Other Comprehensive Income (Loss) The following table summarizes the tax effects on each component of OCI for the periods presented: Three Months Ended November 30, 2022 November 30, 2021 Before-Tax Tax Net-of-Tax Before-Tax Tax Net-of-Tax (in thousands) Foreign currency translation $ 550 $ 308 $ 858 $ ( 4,507 ) $ ( 365 ) $ ( 4,872 ) Pension liability adjustment 15 ( 97 ) ( 82 ) - - - Cash flow hedges ( 5,665 ) 1,665 ( 4,000 ) ( 68,677 ) 15,691 ( 52,986 ) Other comprehensive loss $ ( 5,100 ) $ 1,876 $ ( 3,224 ) $ ( 73,184 ) $ 15,326 $ ( 57,858 ) Six Months Ended November 30, 2022 November 30, 2021 Before-Tax Tax Net-of-Tax Before-Tax Tax Net-of-Tax (in thousands) Foreign currency translation $ ( 8,970 ) $ ( 273 ) $ ( 9,243 ) $ ( 8,124 ) $ ( 723 ) $ ( 8,847 ) Pension liability adjustment 3,740 ( 883 ) 2,857 - - - Cash flow hedges ( 22,762 ) 5,462 ( 17,300 ) ( 68,876 ) 15,591 ( 53,285 ) Other comprehensive loss $ ( 27,992 ) $ 4,306 $ ( 23,686 ) $ ( 77,000 ) $ 14,868 $ ( 62,132 ) |
Changes in Equity
Changes in Equity | 6 Months Ended |
Nov. 30, 2022 | |
Equity [Abstract] | |
Changes in Equity | Note K – Changes in Equity The following tables summarize the changes in equity by component and in total for the periods presented: Controlling Interest Accumulated Other Additional Comprehensive Non- Paid-in Loss, Retained controlling (in thousands) Capital Net of Tax Earnings Total Interests Total Balance at May 31, 2022 $ 273,439 $ ( 22,850 ) $ 1,230,163 $ 1,480,752 $ 133,210 $ 1,613,962 Net earnings - - 64,082 64,082 1,162 65,244 Other comprehensive loss - ( 20,462 ) - ( 20,462 ) - ( 20,462 ) Common shares issued, net of withholding tax ( 3,466 ) - - ( 3,466 ) - ( 3,466 ) Common shares in non-qualified plans 136 - - 136 - 136 Stock-based compensation 6,976 - - 6,976 - 6,976 Cash dividends declared - - ( 15,418 ) ( 15,418 ) - ( 15,418 ) Balance at August 31, 2022 $ 277,085 $ ( 43,312 ) $ 1,278,827 $ 1,512,600 $ 134,372 $ 1,646,972 Net earnings - - 16,218 16,218 3,287 19,505 Other comprehensive loss - ( 3,224 ) - ( 3,224 ) - ( 3,224 ) Common shares issued, net of withholding tax ( 649 ) - - ( 649 ) - ( 649 ) Common shares in non-qualified plans 298 - - 298 - 298 Stock-based compensation 3,620 - - 3,620 - 3,620 Cash dividends declared - - ( 15,470 ) ( 15,470 ) - ( 15,470 ) Dividends to noncontrolling interest - - - - ( 11,760 ) ( 11,760 ) Balance at November 30, 2022 $ 280,354 $ ( 46,536 ) $ 1,279,575 $ 1,513,393 $ 125,899 $ 1,639,292 Controlling Interest Accumulated Other Additional Comprehensive Non- Paid-in Income (Loss), Retained controlling (in thousands) Capital Net of Tax Earnings Total Interests Total Balance at May 31, 2021 $ 282,790 $ 45,387 $ 1,070,016 $ 1,398,193 $ 153,502 $ 1,551,695 Net earnings - - 132,491 132,491 8,984 141,475 Other comprehensive loss - ( 4,274 ) - ( 4,274 ) - ( 4,274 ) Common shares issued, net of withholding tax ( 4,091 ) - - ( 4,091 ) - ( 4,091 ) Common shares in non-qualified plans 89 - - 89 - 89 Stock-based compensation 6,324 - - 6,324 - 6,324 Purchases and retirement of common shares ( 5,477 ) - ( 55,408 ) ( 60,885 ) - ( 60,885 ) Cash dividends declared - - ( 14,504 ) ( 14,504 ) - ( 14,504 ) Dividends to noncontrolling interests - - - - ( 9,197 ) ( 9,197 ) Balance at August 31, 2021 $ 279,635 $ 41,113 $ 1,132,595 $ 1,453,343 $ 153,289 $ 1,606,632 Net earnings - - 110,301 110,301 2,884 113,185 Other comprehensive loss - ( 57,858 ) - ( 57,858 ) - ( 57,858 ) Common shares issued, net of withholding tax ( 2,694 ) - - ( 2,694 ) - ( 2,694 ) Common shares in non-qualified plans 257 - - 257 - 257 Stock-based compensation 3,304 - - 3,304 - 3,304 Purchases and retirement of common shares ( 1,297 ) - ( 11,405 ) ( 12,702 ) - ( 12,702 ) Cash dividends declared - - ( 14,154 ) ( 14,154 ) - ( 14,154 ) Dividends to noncontrolling interest - - - - ( 2,879 ) ( 2,879 ) Balance at November 30, 2021 $ 279,205 $ ( 16,745 ) $ 1,217,337 $ 1,479,797 $ 153,294 $ 1,633,091 The following table summarizes the changes in accumulated other comprehensive income (loss) for the periods presented: Accumulated Foreign Pension Other Currency Liability Cash Flow Comprehensive (in thousands) Translation Adjustment Hedges Loss Balance as of May 31, 2022 $ ( 15,310 ) $ ( 6,244 ) $ ( 1,296 ) $ ( 22,850 ) Other comprehensive loss before reclassifications ( 8,970 ) ( 1,034 ) ( 36,041 ) ( 46,045 ) Reclassification adjustments to net earnings (a) - 4,774 13,279 18,053 Income tax effect ( 273 ) ( 883 ) 5,462 4,306 Balance as of November 30, 2022 $ ( 24,553 ) $ ( 3,387 ) $ ( 18,596 ) $ ( 46,536 ) Accumulated Foreign Pension Other Currency Liability Cash Flow Comprehensive (in thousands) Translation Adjustment Hedges Income (Loss) Balance as of May 31, 2021 $ 1,779 $ ( 15,955 ) $ 59,563 $ 45,387 Other comprehensive income (loss) before reclassifications ( 8,124 ) - 14,279 6,155 Reclassification adjustments to net earnings (a) - - ( 83,155 ) ( 83,155 ) Income tax effect ( 723 ) - 15,591 14,868 Balance as of November 30, 2021 $ ( 7,068 ) $ ( 15,955 ) $ 6,278 $ ( 16,745 ) (a) The statement of earnings classification of amounts reclassified to net earnings include: 1. Pension liability adjustment – During August 2022, we purchased (using pension plan assets) an annuity contract from a third-party insurance company to transfer approximately 31 % of the total projected benefit obligation of The Gerstenslager Company Bargaining Unit Employees’ Pension Plan as of the purchase date. As a result of this transaction: 1) we incurred a non-cash settlement charge of $ 4,774,000 within “Miscellaneous income (expense), net”; 2) we were relieved of all responsibility for these pension obligations; and 3) the insurance company is now required to pay and administer the retirement benefits owed to 220 benefi ciaries; and 2. Cash flow hedges – disclosed in “Note Q – Derivative Financial Instruments and Hedging Activities ”. |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Nov. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Note L – Stock-Based Compensation Non-Qualified Stock Options During the six months ended November 30, 2022, we granted non-qualified stock options covering a total of 84,400 common shares under our stock-based compensation plans. The weighted average exercise price of $ 46.39 per share was equal to the market price of the underlying common shares at the grant date. The fair value of these stock options, based on the Black-Scholes option-pricing model, calculated at the grant date, was $ 16.36 per share. The calculated pre-tax stock-based compensation expense for these stock options is $ 1,381,000 and will be recognized on a straight-line basis o ver the three-year vesting period, net of any forfeitures. The following assumptions were used to value these stock options: Dividend yield 2.33 % Expected volatility 41.63 % Risk-free interest rate 3.19 % Expected term (years) 6.0 Expected volatility is based on the historical volatility of Worthington Industries, Inc.’s common shares and the risk-free interest rate is based on the U.S. Treasury strip rate for the expected term of the stock options. The expected term was developed using historical exercise experience. Service-Based Restricted Common Shares During the six months ended November 30, 2022 , we granted an aggregate of 308,000 service-based restricted common shares under our stock-based compensation plans, which generally vest three years after their grant date. The fair value of these restricted common shares was equal to the weighted average closing market price of the underlying common shares on the date of grant, or $ 51.09 per share. The calculated pre-tax stock-based compensation expense for these restricted common shares is $ 15,216,000 and will be recognized on a straight-line basis over the three-year service-based vesting period. Market-Based Restricted Common Shares On June 24, 2022, we granted 10,000 market-based restricted common shares to one key employee under one of our stock-based compensation plans. Vesting of these restricted common shares is contingent upon the average closing price of the common shares reaching $ 65.00 during any 90 consecutive day period during the five-year period following the date of grant and completion of a three-year service vesting period. The grant date fair value of these restricted common shares, as determined by a Monte Carlo simulation model, was $ 35.49 per share. The calculated pre-tax stock-based compensation expense for these market-based restricted common shares is $ 355,000 and will be recognized on a straight-line basis over the three-year service-based vesting period. The following assumptions were used to determine the grant-date fair value and the derived service period for these restricted common shares: Dividend yield 2.67 % Expected volatility 43.00 % Risk-free interest rate 3.18 % Performance Share Awards We have awarded performance shares to certain key employees under our stock-based compensation plans. These performance shares are earned based on the level of achievement with respect to corporate targets for cumulative corporate economic value added, earnings per share growth and, in the case of business unit executives, a business unit adjusted earnings before interest and taxes target, in each case for the three-year periods ending May 31, 2023, 2024 and 2025. These performance share awards will be paid, to the extent earned, in common shares of Worthington Industries, Inc. in the fiscal quarter following the end of the applicable three-year performance period. The fair values of our performance shares are determined by the closing market prices of the underlying common shares at the respective grant dates of the performance shares and the pre-tax stock-based compensation expense is based on our periodic assessment of the probability of the targets being achieved and our estimate of the number of common shares that will ultimately be issued. During the six months ended November 30, 2022 , we granted performance share awards covering an aggregate of 58,100 common shares (at target levels). The calculated pre-tax stock-based compensation expense for these performance shares is $ 2,695,000 . The ultimate pre-tax stock-based compensation expense to be recognized over the three-year performance period on all tranches will vary based on our periodic assessment of the probability of the targets being achieved. |
Income Taxes
Income Taxes | 6 Months Ended |
Nov. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note M – Income Taxes Income tax expense for the six months ended November 30, 2022 and 2021 reflected estimated annual effective income tax rates of 23.7 % and 22.8 %, respectively, and exclude any impact from the inclusion of net earnings attributable to noncontrolling interests in our consolidated statements of earnings. Net earnings attributable to noncontrolling interests are a result of our Samuel, Spartan, TWB and WSP (through October 31, 2022) consolidated joint ventures. The net earnings attributable to the noncontrolling interests in Samuel, Spartan, TWB and WSP’s U.S. operations do not generate tax expense to Worthington since the investors in Samuel, Spartan, TWB and WSP’s U.S. operations are taxed directly based on the earnings attributable to them. The tax expense of TWB’s wholly-owned foreign corporations is reported in our consolidated income tax expense. Management is required to estimate the annual effective income tax rate based upon its forecast of annual pre-tax income for domestic and foreign operations. Our actual effective income tax rate for fiscal 2023 could be materially different from the forecasted rate as of November 30, 2022 . |
Earnings per Share
Earnings per Share | 6 Months Ended |
Nov. 30, 2022 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Note N – Earnings per Share The following table sets forth the computation of basic and diluted earnings per share attributable to controlling interest for the periods presented: Three Months Ended Six Months Ended November 30, November 30, (in thousands, except per share amounts) 2022 2021 2022 2021 Numerator (basic & diluted): Net earnings attributable to controlling interest - income available to common shareholders $ 16,218 $ 110,301 $ 80,300 $ 242,792 Denominator: Denominator for basic earnings per share attributable to controlling interest - weighted average common shares 48,558 50,381 48,518 50,618 Effect of dilutive securities 772 833 775 914 Denominator for diluted earnings per share attributable to controlling interest - adjusted weighted average common shares 49,330 51,214 49,293 51,532 Basic earnings per share attributable to controlling interest $ 0.33 $ 2.19 $ 1.66 $ 4.80 Diluted earnings per share attributable to controlling interest $ 0.33 $ 2.15 $ 1.63 $ 4.71 Stock options covering an aggregate of 138,100 and 54,500 common shares for the three months ended November 30, 2022 and 2021, respectively, and 127,492 and 47,352 common shares for the six months ended November 20, 2022 and 2021, respectively have been excluded from the computation of diluted earnings per share because the effect would have been anti-dilutive for those periods. |
Segment Operations
Segment Operations | 6 Months Ended |
Nov. 30, 2022 | |
Segment Reporting [Abstract] | |
Segment Operations | Note O – Segment Operations The profit measure that the Company’s Chief Operating Decision Maker ("CODM") uses to assess segment performance and allocate resources is adjusted earnings (loss) before interest and taxes (“adjusted EBIT”). EBIT is calculated by adding interest expense and income tax expense to net earnings attributable to controlling interest. Adjusted EBIT excludes impairment and restructuring charges (gains), but may also exclude other items that management believes are not reflective of, and thus should not be included when evaluating the performance of the Company’s ongoing operations, including direct and incremental costs incurred in connection with the planned Separation of the Company’s Steel Processing business. Adjusted EBIT is a non-GAAP financial measure and is used by management to evaluate segment performance, engage in financial and operational planning and determine incentive compensation because we believe that this financial measure provides additional perspective and, in some circumstances is more closely correlated to, the performance of the Company’s ongoing operations. The following table presents summarized financial information for our reportable operating segments for the periods indicated. Three Months Ended November 30, 2022 (in thousands) Steel Processing Consumer Products Building Products Sustainable Energy Solutions Other Consolidated Net sales $ 841,947 $ 153,795 $ 141,671 $ 38,128 $ - $ 1,175,541 Restructuring and other income, net ( 4,282 ) - - - - ( 4,282 ) Separation costs - - - - 9,246 9,246 Miscellaneous income (expense), net 850 ( 47 ) 76 142 384 1,405 Equity in net income (loss) of unconsolidated affiliates 1,906 - 35,107 - ( 156 ) 36,857 Adjusted EBIT (1)(2) ( 17,249 ) 13,473 41,224 1,143 ( 3,291 ) 35,300 (1) Excludes the noncontrolling interest portion of the restructuring gains within Steel Processing of $ 1,850 . (2) Excludes $ 525 in selling, general and administrative expense in Consumer Products related to incremental expense attributable to the Level5 earnout; excludes $ 9,246 of Separation costs in Other related to direct and incremental costs incurred in connection with the anticipated Separation, including audit, advisory, and legal costs. Three Months Ended November 30, 2021 (in thousands) Steel Processing Consumer Products Building Products Sustainable Energy Solutions Other Consolidated Net sales $ 937,842 $ 140,793 $ 121,125 $ 33,101 $ - $ 1,232,861 Restructuring and other income, net ( 182 ) - - - ( 1,822 ) ( 2,004 ) Miscellaneous income, net 17 159 218 82 564 1,040 Equity in net income of unconsolidated affiliates 8,823 - 49,894 - 1,501 60,218 Adjusted EBIT (3) 71,925 17,584 54,718 796 1,893 146,916 (3) Excludes the noncontrolling interest portion of the restructuring gains within Steel Processing of $ 81 . Six Months Ended November 30, 2022 (in thousands) Steel Processing Consumer Products Building Products Sustainable Energy Solutions Other Consolidated Net sales $ 1,880,827 $ 342,497 $ 291,994 $ 68,888 $ - $ 2,584,206 Impairment of long-lived assets 312 - - - - 312 Restructuring and other income, net ( 4,205 ) - - - ( 1,177 ) ( 5,382 ) Separation costs - - - - 9,246 9,246 Miscellaneous income (expense), net 1,035 ( 82 ) 299 56 ( 4,989 ) ( 3,681 ) Equity in net income (loss) of unconsolidated affiliates 3,676 - 78,973 - ( 14,080 ) 68,569 Adjusted EBIT (4)(5) 17,663 34,406 93,959 ( 250 ) 1,854 147,632 (4) Excludes a non-cash settlement charge of $ 4,774 in miscellaneous income (expense), net within Other to accelerate a portion of deferred pension cost as a result of a pension lift-out transaction executed with a third-party insurance company to transfer a portion of the total projected benefit obligation of The Gerstenslager Company Bargaining Unit Employees’ Pension Plan to the third-party insurance company; excludes a loss of $ 15,759 in equity in net income (loss) of unconsolidated affiliates within Other related to the sale of the Company’s 50 % noncontrolling equity investment in ArtiFlex effective August 3, 2022; excludes $ 1,050 in selling, general and administrative expense in Consumer Products related to incremental compensation expense attributable to the Level5 earnout; and excludes $ 9,246 of Separation costs in Other related to direct and incremental costs incurred in connection with the anticipated Separation, including audit, advisory, and legal costs. (5) Excludes the noncontrolling interest portion of the impairment charge and restructuring gains within Steel Processing of $ 1,734 . Six Months Ended November 30, 2021 (in thousands) Steel Processing Consumer Products Building Products Sustainable Energy Solutions Other Consolidated Net sales $ 1,760,652 $ 288,576 $ 235,868 $ 58,583 $ - $ 2,343,679 Restructuring and other income, net ( 12,313 ) - - ( 143 ) ( 1,822 ) ( 14,278 ) Miscellaneous income, net 47 209 144 22 1,248 1,670 Equity in net income of unconsolidated affiliates 18,172 - 92,887 - 2,075 113,134 Adjusted EBIT (6) 179,617 38,140 103,471 ( 1,760 ) 1,479 320,947 (6) Excludes the noncontrolling interest portion of the restructuring gains within Steel Processing of $ 6,027 . Total assets for each of our operating segments as of the dates indicated were as follows: November 30, May 31, (in thousands) 2022 2022 Total assets Steel Processing $ 1,796,136 $ 2,082,522 Consumer Products 627,474 577,026 Building Products 645,566 681,188 Sustainable Energy Solutions 120,978 114,084 Other 200,506 188,203 Total assets $ 3,390,660 $ 3,643,023 |
Acquisitions
Acquisitions | 6 Months Ended |
Nov. 30, 2022 | |
Business Combinations [Abstract] | |
Acquisitions | Note P – Acquisitions Level5® Tools, LLC On June 2, 2022, we acquired Level5® Tools, LLC ("Level5"), a leading provider of drywall tools and related accessories. The total purchase price was $ 59,321,000 , including $ 2,000,000 attributed to an earnout agreement with the selling shareholders, that provides for up to an additional $ 25,000,000 of cash consideration should certain earnings targets be met annually through calendar 2024. The earnout agreement also requires continued employment of a selling shareholder during the duration of the earnout period. Accordingly, payments to this key employee, to the extent earned, will be accounted for as post-combination compensation expense. During the three months and six months ended November 30, 2022, compensation expense of $ 525,000 and $ 1,050,000 , respectively, has been accrued within selling, general, and administrative expense in the consolidated statements of earnings related to the earnout. Level5 is being operated as part of the Consumer Products operating segment and its results have been included in our consolidated statements of earnings since the date of acquisition. Proforma results, including the acquired business since the beginning of fiscal 2022, would not be materially different from the reported results. The information included herein has been based on the preliminary allocation of the purchase price using estimates of the fair value and useful lives of the assets acquired. The purchase price allocation is subject to further adjustment until all pertinent information regarding the assets acquired is fully evaluated by us, including but not limited to, the fair value accounting. The assets acquired and liabilities assumed were recognized at their estimated acquisition-date fair values, with goodwill representing the excess of the purchase price over the fair value of the net identifiable assets acquired. In connection with the acquisition of Level5, we identified and valued the following intangible assets: (in thousands) Category Amount Useful Life (Years) Trade name $ 13,500 Indefinite Customer relationships 13,300 10 Technological know-how 6,500 20 Non-compete agreement 280 3 Total acquired identifiable intangible assets $ 33,580 The purchase price includes the fair values of other assets that were not identifiable, not separately recognizable under applicable accounting rules (e.g., assembled workforce) or of immaterial value. The purchase price also includes strategic and synergistic benefits (investment value) specific to us, which resulted in a purchase price in excess of the fair value of the identifiable net assets. This additional investment value resulted in goodwill which will be deductible by us for income tax purposes. The following table summarizes the consideration transferred and the estimated fair value assigned to the assets acquired and liabilities assumed at the acquisition date. These amounts reflect various preliminary fair value estimates and assumptions, including preliminary work performed by a third-party valuation specialist, and are subject to change within the measurement period as the valuation is finalized. The primary areas of preliminary purchase price allocation subject to change relate to the valuation of acquired tangible assets and liabilities, identification and valuation of residual goodwill and tax effects of acquired assets and assumed liabilities. (in thousands) Preliminary Measurement Revised Cash and cash equivalents $ 1,515 $ - $ 1,515 Accounts receivable 2,860 - 2,860 Inventories 9,161 - 9,161 Prepaid expenses 64 - 64 Property, plant and equipment 273 - 273 Intangible assets 33,580 - 33,580 Operating lease assets 377 - 377 Total identifiable assets 47,830 - 47,830 Accounts payable ( 3,175 ) - ( 3,175 ) Accrued expenses ( 904 ) 151 ( 753 ) Current operating lease liabilities ( 111 ) - ( 111 ) Noncurrent operating lease liabilities ( 266 ) - ( 266 ) Net identifiable assets 43,374 151 43,525 Goodwill 15,947 - 15,947 Total purchase price 59,321 151 59,472 Less: Fair value of earnout ( 2,000 ) - ( 2,000 ) Plus: Net working capital deficit 282 ( 151 ) 131 Cash purchase price $ 57,603 $ - $ 57,603 |
Derivative Financial Instrument
Derivative Financial Instruments and Hedging Activities | 6 Months Ended |
Nov. 30, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments and Hedging Activities | Note Q – Derivative Financial Instruments and Hedging Activities We utilize derivative financial instruments to primarily manage exposure to certain risks related to our ongoing operations. The primary risks managed through the use of derivative financial instruments include interest rate risk, foreign currency exchange rate risk and commodity price risk. While certain of our derivative financial instruments are designated as hedging instruments, we also enter into derivative financial instruments that are designed to hedge a risk, but are not designated as hedging instruments and, therefore, do not qualify for hedge accounting. These derivative financial instruments are adjusted to current fair value through earnings at the end of each period. Interest Rate Risk Management – We are exposed to the impact of interest rate changes. Our objective is to manage the impact of interest rate changes on cash flows and the market value of our borrowings. We utilize a mix of debt maturities along with both fixed-rate and variable-rate debt to manage changes in interest rates. In addition, we enter into interest rate swaps and treasury locks to further manage our exposure to interest rate variations related to our borrowings and to lower our overall borrowing costs. Foreign Currency Exchange Rate Risk Management – We conduct business in several major international currencies and are, therefore, subject to risks associated with changing foreign currency exchange rates. We enter into various contracts that change in value as foreign currency exchange rates change to manage this exposure. Such contracts limit exposure to both favorable and unfavorable currency exchange rate fluctuations. The translation of foreign currencies into U.S. dollars also subjects us to exposure related to fluctuating currency exchange rates; however, derivative financial instruments are not used to manage this risk. Commodity Price Risk Management – We are exposed to changes in the price of certain commodities, including steel, natural gas, copper, zinc and other raw materials, and our utility requirements. Our objective is to reduce earnings and cash flow volatility associated with forecasted purchases and sales of these commodities to allow management to focus its attention on business operations. Accordingly, we enter into derivative financial instruments to manage the associated price risk. We are exposed to counterparty credit risk on all of our derivative financial instruments. Accordingly, we have established and maintain strict counterparty credit guidelines. We have credit support agreements in place with certain counterparties to limit our credit exposure. These agreements require either party to post cash collateral if its cumulative market position exceeds a predefined liability threshold. Amounts posted to the margin accounts accrue interest at market rates and are required to be refunded in the period in which the cumulative market position falls below the required threshold. We do not have significant exposure to any one counterparty, and management believes the overall risk of loss is remote and, in any event, would not be material. Refer to “Note R – Fair Value” for additional information regarding the accounting treatment for our derivative financial instruments, as well as how fair value is determined. The following table summarizes the fair value of our derivative financial instruments and the respective lines in which they were recorded in the consolidated balance sheet at November 30, 2022: Asset Derivatives Liability Derivatives Balance Balance Sheet Fair Sheet Fair (in thousands) Location Value Location Value Derivatives designated as hedging instruments: Commodity contracts Receivables $ 140 Accounts payable $ 16,830 Other assets - Other liabilities 941 140 17,771 Foreign currency exchange contracts Other assets 258 Accounts payable - Total $ 398 $ 17,771 Derivatives not designated as hedging instruments: Commodity contracts Receivables $ 4,622 Accounts payable $ 2,155 Other assets 18 Other liabilities 275 4,640 2,430 Foreign currency exchange contracts Receivables - Accounts payable 94 Total $ 4,640 $ 2,524 Total derivative financial instruments $ 5,038 $ 20,295 The amounts in the table above reflect the fair value of our derivative financial instruments on a net basis where allowable under master netting arrangements. Had these amounts been recognized on a gross basis, the impact would have been a $ 6,739,000 increase in “Receivables” with a corresponding increase in “Accounts payable.” The following table summarizes the fair value of our derivative financial instruments and the respective lines in which they were recorded in the consolidated balance sheet at May 31, 2022: Asset Derivatives Liability Derivatives Balance Balance Sheet Fair Sheet Fair (in thousands) Location Value Location Value Derivatives designated as hedging instruments: Commodity contracts Receivables $ 1,040 Accounts payable $ 4,517 Other assets - Other liabilities 48 1,040 4,565 Foreign currency exchange contracts Receivables - Accounts payable - Other assets - Other liabilities 17 - 17 Total $ 1,040 $ 4,582 Derivatives not designated as hedging instruments: Commodity contracts Receivables $ 11,555 Accounts payable $ 4,142 Other assets 48 Other liabilities 24 11,603 4,166 Foreign currency exchange contracts Receivables - Accounts payable 255 Total $ 11,603 $ 4,421 Total derivative financial instruments $ 12,643 $ 9,003 The amounts in the table above reflect the fair value of our derivative financial instruments on a net basis where allowable under master netting arrangements. Had these amounts been recognized on a gross basis, the impact would have been a $ 6,300,000 increase in “Receivables” with a corresponding increase in “Accounts payable.” Cash Flow Hedges We enter into derivative financial instruments to hedge our exposure to changes in cash flows attributable to commodity price fluctuations associated with certain forecasted transactions. These derivative financial instruments are designated and qualify as cash flow hedges. The earnings effects of these derivative financial instruments are presented in the same statement of earnings line items as the earnings effects of the hedged items. For derivative financial instruments designated as cash flow hedges, we assess hedge effectiveness both at the onset of the hedge and at regular intervals throughout the life of the derivative financial instruments. The following table summarizes our cash flow hedges outstanding at November 30, 2022: Notional (in thousands) Amount Maturity Date Commodity contracts $ 114,516 December 2022 - December 2023 Foreign currency exchange contracts $ 1,751 January 2023 - July 2023 The following table summarizes the gain (loss) recognized in OCI and the gain (loss) reclassified from Accumulated Other Comprehensive Income (Loss) (“AOCI”) into net earnings for derivative financial instruments designated as cash flow hedges for the periods presented: (in thousands) Gain (Loss) Location of Gain (Loss) Gain (Loss) Reclassified For the three months ended November 30, 2022: Commodity contracts $ ( 19,641 ) Cost of goods sold $ ( 13,648 ) Interest rate contracts - Interest expense ( 7 ) Foreign currency exchange contracts 376 Net sales/Cost of goods sold 53 Total $ ( 19,265 ) $ ( 13,602 ) For the three months ended November 30, 2021: Commodity contracts $ ( 21,002 ) Cost of goods sold $ 47,706 Interest rate contracts - Interest expense 27 Foreign currency exchange contracts 60 Miscellaneous income, net 3 Total $ ( 20,942 ) $ 47,736 For the six months ended November 30, 2022: Commodity contracts $ ( 36,099 ) Cost of goods sold $ ( 13,192 ) Interest rate contracts - Interest expense ( 13 ) Foreign currency exchange contracts 58 Net sales/Cost of goods sold ( 74 ) Total $ ( 36,041 ) $ ( 13,279 ) For the six months ended November 30, 2021: Commodity contracts $ 14,218 Cost of goods sold $ 83,165 Interest rate contracts - Interest expense ( 13 ) Foreign currency exchange contracts 61 Miscellaneous income, net 3 Total $ 14,279 $ 83,155 The estimated net amount of the losses recognized in AOCI at November 30, 2022 expected to be reclassified into net earnings within the succeeding twelve months is $ 18,807,000 (net of tax of $ 5,918,000 ). This amount was computed using the fair value of the cash flow hedges at November 30, 2022, and will change before actual reclassification from OCI to net earnings during the fiscal years ending May 31, 2023 and May 31, 2024. Economic (Non-designated) Hedges We enter into foreign currency exchange contracts to manage our foreign currency exchange rate exposure related to inter-company and financing transactions that do not meet the requirements for hedge accounting treatment. We also enter into certain commodity contracts that do not qualify for hedge accounting treatment. Accordingly, these derivative financial instruments are adjusted to current market value at the end of each period through gain (loss) recognized in earnings. The following table summarizes our economic (non-designated) derivative financial instruments outstanding at November 30, 2022: Notional (in thousands) Amount Maturity Date(s) Commodity contracts $ 5,100 December 2022 - December 2023 Foreign currency exchange contracts $ 15,096 December 2022 The following table summarizes the gain (loss) recognized in earnings for economic (non-designated) derivative financial instruments for the periods presented: Gain (Loss) Recognized In Earnings for the Location of Gain (Loss) Three Months Ended November 30, (in thousands) Recognized in Earnings 2022 2021 Commodity contracts Cost of goods sold $ 3,861 $ ( 10,135 ) Foreign currency exchange contracts Miscellaneous income, net ( 47 ) ( 588 ) Total $ 3,814 $ ( 10,723 ) Gain (Loss) Recognized in Earnings for the Location of Gain (Loss) Six Months Ended November 30, (in thousands) Recognized in Earnings 2022 2021 Commodity contracts Cost of goods sold $ 2,284 $ ( 19,392 ) Foreign currency exchange contracts Miscellaneous income, net ( 141 ) ( 249 ) Total $ 2,143 $ ( 19,641 ) |
Fair Value
Fair Value | 6 Months Ended |
Nov. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Note R – Fair Value Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value is an exit price concept that assumes an orderly transaction between willing market participants and is required to be based on assumptions that market participants would use in pricing an asset or a liability. Current accounting guidance establishes a three-tier fair value hierarchy as a basis for considering such assumptions and for classifying the inputs used in the valuation methodologies. This hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair values are as follows: Level 1 – Observable prices in active markets for identical assets and liabilities. Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the assets and liabilities, either directly or indirectly. Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. Recurring Fair Value Measurements At November 30, 2022, our assets and liabilities measured at fair value on a recurring basis were as follows: Significant Quoted Prices Other Significant in Active Observable Unobservable Markets Inputs Inputs (in thousands) (Level 1) (Level 2) (Level 3) Totals Assets Derivative financial instruments (1) $ - $ 5,038 $ - $ 5,038 Total assets $ - $ 5,038 $ - $ 5,038 Liabilities Derivative financial instruments (1) $ - $ 20,295 $ - $ 20,295 Total liabilities $ - $ 20,295 $ - $ 20,295 (1) The fair value of our derivative financial instruments is based on the present value of the expected future cash flows considering the risks involved, including non-performance risk, and using discount rates appropriate for the respective maturities. Market observable, Level 2 inputs are used to determine the present value of the expected future cash flows. Refer to “Note Q – Derivative Financial Instruments and Hedging Activities” for additional information regarding our use of derivative financial instruments. At May 31, 2022, our assets and liabilities measured at fair value on a recurring basis were as follows: Significant Quoted Prices Other Significant in Active Observable Unobservable Markets Inputs Inputs (in thousands) (Level 1) (Level 2) (Level 3) Totals Assets Derivative financial instruments (1) $ - $ 12,643 $ - $ 12,643 Total assets $ - $ 12,643 $ - $ 12,643 Liabilities Derivative financial instruments (1) $ - $ 9,003 $ - $ 9,003 Total liabilities $ - $ 9,003 $ - $ 9,003 (1) The fair value of our derivative financial instruments is based on the present value of the expected future cash flows considering the risks involved, including non-performance risk, and using discount rates appropriate for the respective maturities. Market observable, Level 2 inputs are used to determine the present value of the expected future cash flows. Refer to “ Note Q – Derivative Financial Instruments and Hedging Activities ” for additional information regarding our use of derivative financial instruments. Non-Recurring Fair Value Measurements At November 30, 2022 , there were no assets measured at fair value on a non-recurring basis on the Company’s consolidated balance sheet. At May 31, 2022, our assets measured at fair value on a non-recurring basis were as follows: Significant Quoted Prices Other Significant in Active Observable Unobservable Markets Inputs Inputs (in thousands) (Level 1) (Level 2) (Level 3) Totals Assets Long-lived assets held for sale (1) $ - $ 700 $ - $ 700 Total assets $ - $ 700 $ - $ 700 (1) Comprised of production equipment at our Twinsburg, Ohio facility with an estimated fair market value of $ 700,000 . The fair value of non-derivative financial instruments included in the carrying amounts of cash and cash equivalents, receivables, income taxes receivable, other assets, accounts payable, accrued compensation, contributions to employee benefit plans and related taxes, other accrued items, income taxes payable and other liabilities approximate carrying value due to their short-term nature. The fair value of long-term debt, including current maturities, based upon models utilizing market observable (Level 2) inputs and credit risk, was $ 646,856,000 and $ 684,830,000 at November 30, 2022 and May 31, 2022, respectively. The carrying amount of long-term debt, including current maturities, was $ 693,710,000 and $ 696,610,000 at November 30, 2022 and May 31, 2022 , respectively. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 6 Months Ended |
Nov. 30, 2022 | |
Disaggregation Of Revenue [Line Items] | |
Revenue by Product Class and Over Time | The following table summarizes net sales by operating segment and product class for the periods presented: Three Months Ended Six Months Ended November 30, November 30, (in thousands) 2022 2021 2022 2021 Steel Processing Direct $ 807,259 $ 900,666 $ 1,809,394 $ 1,688,694 Toll 34,688 37,176 71,433 71,958 Total 841,947 937,842 1,880,827 1,760,652 Consumer Products (1) 153,795 140,793 342,497 288,576 Building Products (1) 141,671 121,125 291,994 235,868 Sustainable Energy Solutions (1) 38,128 33,101 68,888 58,583 Total $ 1,175,541 $ 1,232,861 $ 2,584,206 $ 2,343,679 |
Summary of Unbilled Receivable | The following table summarizes the unbilled receivables at the dates indicated: November 30, May 31, (in thousands) Balance Sheet Classification 2022 2022 Unbilled receivables Receivables $ 3,192 $ 5,001 |
Over time revenue | |
Disaggregation Of Revenue [Line Items] | |
Revenue by Product Class and Over Time | The following table summarizes the over time revenue for the periods presented: Three Months Ended Six Months Ended November 30, November 30, (in thousands) 2022 2021 2022 2021 Steel Processing - toll $ 34,688 $ 37,176 $ 71,433 $ 71,958 |
Investments in Unconsolidated_2
Investments in Unconsolidated Affiliates (Tables) | 6 Months Ended |
Nov. 30, 2022 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Financial Information | The following tables summarize combined financial information for our unconsolidated affiliates as of the dates, and for the periods presented: November 30, May 31, (in thousands) 2022 2022 Cash and cash equivalents $ 41,768 $ 68,563 Other current assets 911,881 1,148,029 Noncurrent assets 301,027 369,608 Total assets $ 1,254,676 $ 1,586,200 Current liabilities 292,303 345,097 Short-term borrowings 10,000 5,943 Current maturities of long-term debt 36,110 33,054 Long-term debt 304,108 306,814 Other noncurrent liabilities 69,667 76,437 Equity 542,488 818,855 Total liabilities and equity $ 1,254,676 $ 1,586,200 Three Months Ended Six Months Ended November 30, November 30, (in thousands) 2022 2021 2022 2021 Net sales $ 711,665 $ 858,165 $ 1,535,607 $ 1,603,160 Gross margin 147,299 226,502 328,704 416,176 Operating income 107,356 184,779 245,183 330,767 Depreciation and amortization 6,864 7,848 15,052 16,075 Interest expense 3,910 2,711 6,590 5,172 Income tax expense 1,262 8,565 3,372 16,461 Net earnings 105,183 173,915 238,421 312,803 |
Restructuring and Other Incom_2
Restructuring and Other Income, Net (Tables) | 6 Months Ended |
Nov. 30, 2022 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Progression of Liabilities Associated with Restructuring Activities, Combined with Reconciliation to Restructuring and Other Income, Net | A progression of the liabilities associated with our restructuring activities, combined with a reconciliation to the restructuring and other income, net financial statement caption, in our consolidated statement of earnings for the six months ended November 30, 2022 is summarized below: (in thousands) Balance, as of Expense Payments Adjustments Balance, as of Early retirement and severance $ 541 $ 85 $ ( 605 ) $ - $ 21 Net gain on sale of assets (1)(2) ( 5,467 ) Restructuring and other income, net $ ( 5,382 ) (1) On June 14, 2022, we sold real property in Tulsa, Oklahoma, for net cash proceeds of $ 5,775,000 , resulting in a pre-tax gain of $ 1,177,000 . These assets had been excluded from the sale of our former oil & gas equipment business in January 2021. The assets were classified in assets held for sale on the consolidated balance sheets immediately prior to the closing of the sale. (2) On October 31, 2022, the Company’s consolidated steel processing joint venture, WSP, sold its remaining manufacturing facility, located in Jackson, Michigan. Net proceeds of $ 21,277,000 were realized in connection with the transaction, of which $ 2,000,000 is being held in escrow for general representations and warranties. The transaction resulted in a pre-tax gain of $ 3,926,000 . The assets were classified in assets held for sale on the consolidated balance sheets immediately prior to the closing of the sale. |
Other Comprehensive Income (L_2
Other Comprehensive Income (Loss) (Tables) | 6 Months Ended |
Nov. 30, 2022 | |
Components Of Other Comprehensive Income Loss [Abstract] | |
Summary of Tax Effects on Each Component of OCI | The following table summarizes the tax effects on each component of OCI for the periods presented: Three Months Ended November 30, 2022 November 30, 2021 Before-Tax Tax Net-of-Tax Before-Tax Tax Net-of-Tax (in thousands) Foreign currency translation $ 550 $ 308 $ 858 $ ( 4,507 ) $ ( 365 ) $ ( 4,872 ) Pension liability adjustment 15 ( 97 ) ( 82 ) - - - Cash flow hedges ( 5,665 ) 1,665 ( 4,000 ) ( 68,677 ) 15,691 ( 52,986 ) Other comprehensive loss $ ( 5,100 ) $ 1,876 $ ( 3,224 ) $ ( 73,184 ) $ 15,326 $ ( 57,858 ) Six Months Ended November 30, 2022 November 30, 2021 Before-Tax Tax Net-of-Tax Before-Tax Tax Net-of-Tax (in thousands) Foreign currency translation $ ( 8,970 ) $ ( 273 ) $ ( 9,243 ) $ ( 8,124 ) $ ( 723 ) $ ( 8,847 ) Pension liability adjustment 3,740 ( 883 ) 2,857 - - - Cash flow hedges ( 22,762 ) 5,462 ( 17,300 ) ( 68,876 ) 15,591 ( 53,285 ) Other comprehensive loss $ ( 27,992 ) $ 4,306 $ ( 23,686 ) $ ( 77,000 ) $ 14,868 $ ( 62,132 ) |
Changes in Equity (Tables)
Changes in Equity (Tables) | 6 Months Ended |
Nov. 30, 2022 | |
Equity [Abstract] | |
Summary of Changes in Equity by Component and in Total | The following tables summarize the changes in equity by component and in total for the periods presented: Controlling Interest Accumulated Other Additional Comprehensive Non- Paid-in Loss, Retained controlling (in thousands) Capital Net of Tax Earnings Total Interests Total Balance at May 31, 2022 $ 273,439 $ ( 22,850 ) $ 1,230,163 $ 1,480,752 $ 133,210 $ 1,613,962 Net earnings - - 64,082 64,082 1,162 65,244 Other comprehensive loss - ( 20,462 ) - ( 20,462 ) - ( 20,462 ) Common shares issued, net of withholding tax ( 3,466 ) - - ( 3,466 ) - ( 3,466 ) Common shares in non-qualified plans 136 - - 136 - 136 Stock-based compensation 6,976 - - 6,976 - 6,976 Cash dividends declared - - ( 15,418 ) ( 15,418 ) - ( 15,418 ) Balance at August 31, 2022 $ 277,085 $ ( 43,312 ) $ 1,278,827 $ 1,512,600 $ 134,372 $ 1,646,972 Net earnings - - 16,218 16,218 3,287 19,505 Other comprehensive loss - ( 3,224 ) - ( 3,224 ) - ( 3,224 ) Common shares issued, net of withholding tax ( 649 ) - - ( 649 ) - ( 649 ) Common shares in non-qualified plans 298 - - 298 - 298 Stock-based compensation 3,620 - - 3,620 - 3,620 Cash dividends declared - - ( 15,470 ) ( 15,470 ) - ( 15,470 ) Dividends to noncontrolling interest - - - - ( 11,760 ) ( 11,760 ) Balance at November 30, 2022 $ 280,354 $ ( 46,536 ) $ 1,279,575 $ 1,513,393 $ 125,899 $ 1,639,292 Controlling Interest Accumulated Other Additional Comprehensive Non- Paid-in Income (Loss), Retained controlling (in thousands) Capital Net of Tax Earnings Total Interests Total Balance at May 31, 2021 $ 282,790 $ 45,387 $ 1,070,016 $ 1,398,193 $ 153,502 $ 1,551,695 Net earnings - - 132,491 132,491 8,984 141,475 Other comprehensive loss - ( 4,274 ) - ( 4,274 ) - ( 4,274 ) Common shares issued, net of withholding tax ( 4,091 ) - - ( 4,091 ) - ( 4,091 ) Common shares in non-qualified plans 89 - - 89 - 89 Stock-based compensation 6,324 - - 6,324 - 6,324 Purchases and retirement of common shares ( 5,477 ) - ( 55,408 ) ( 60,885 ) - ( 60,885 ) Cash dividends declared - - ( 14,504 ) ( 14,504 ) - ( 14,504 ) Dividends to noncontrolling interests - - - - ( 9,197 ) ( 9,197 ) Balance at August 31, 2021 $ 279,635 $ 41,113 $ 1,132,595 $ 1,453,343 $ 153,289 $ 1,606,632 Net earnings - - 110,301 110,301 2,884 113,185 Other comprehensive loss - ( 57,858 ) - ( 57,858 ) - ( 57,858 ) Common shares issued, net of withholding tax ( 2,694 ) - - ( 2,694 ) - ( 2,694 ) Common shares in non-qualified plans 257 - - 257 - 257 Stock-based compensation 3,304 - - 3,304 - 3,304 Purchases and retirement of common shares ( 1,297 ) - ( 11,405 ) ( 12,702 ) - ( 12,702 ) Cash dividends declared - - ( 14,154 ) ( 14,154 ) - ( 14,154 ) Dividends to noncontrolling interest - - - - ( 2,879 ) ( 2,879 ) Balance at November 30, 2021 $ 279,205 $ ( 16,745 ) $ 1,217,337 $ 1,479,797 $ 153,294 $ 1,633,091 |
Summary of Changes in Accumulated Other Comprehensive Income (Loss) | The following table summarizes the changes in accumulated other comprehensive income (loss) for the periods presented: Accumulated Foreign Pension Other Currency Liability Cash Flow Comprehensive (in thousands) Translation Adjustment Hedges Loss Balance as of May 31, 2022 $ ( 15,310 ) $ ( 6,244 ) $ ( 1,296 ) $ ( 22,850 ) Other comprehensive loss before reclassifications ( 8,970 ) ( 1,034 ) ( 36,041 ) ( 46,045 ) Reclassification adjustments to net earnings (a) - 4,774 13,279 18,053 Income tax effect ( 273 ) ( 883 ) 5,462 4,306 Balance as of November 30, 2022 $ ( 24,553 ) $ ( 3,387 ) $ ( 18,596 ) $ ( 46,536 ) Accumulated Foreign Pension Other Currency Liability Cash Flow Comprehensive (in thousands) Translation Adjustment Hedges Income (Loss) Balance as of May 31, 2021 $ 1,779 $ ( 15,955 ) $ 59,563 $ 45,387 Other comprehensive income (loss) before reclassifications ( 8,124 ) - 14,279 6,155 Reclassification adjustments to net earnings (a) - - ( 83,155 ) ( 83,155 ) Income tax effect ( 723 ) - 15,591 14,868 Balance as of November 30, 2021 $ ( 7,068 ) $ ( 15,955 ) $ 6,278 $ ( 16,745 ) (a) The statement of earnings classification of amounts reclassified to net earnings include: 1. Pension liability adjustment – During August 2022, we purchased (using pension plan assets) an annuity contract from a third-party insurance company to transfer approximately 31 % of the total projected benefit obligation of The Gerstenslager Company Bargaining Unit Employees’ Pension Plan as of the purchase date. As a result of this transaction: 1) we incurred a non-cash settlement charge of $ 4,774,000 within “Miscellaneous income (expense), net”; 2) we were relieved of all responsibility for these pension obligations; and 3) the insurance company is now required to pay and administer the retirement benefits owed to 220 benefi ciaries; and 2. Cash flow hedges – disclosed in “Note Q – Derivative Financial Instruments and Hedging Activities ”. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Nov. 30, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Assumptions Used to Determine Grant Date Fair Value of Market Based Restricted Common Shares | The following assumptions were used to determine the grant-date fair value and the derived service period for these restricted common shares: Dividend yield 2.67 % Expected volatility 43.00 % Risk-free interest rate 3.18 % |
Non-Qualified Stock Options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Assumptions Used to Determine Fair Value of Stock Options | The following assumptions were used to value these stock options: Dividend yield 2.33 % Expected volatility 41.63 % Risk-free interest rate 3.19 % Expected term (years) 6.0 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 6 Months Ended |
Nov. 30, 2022 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Earnings Per Share Attributable to Controlling Interest | The following table sets forth the computation of basic and diluted earnings per share attributable to controlling interest for the periods presented: Three Months Ended Six Months Ended November 30, November 30, (in thousands, except per share amounts) 2022 2021 2022 2021 Numerator (basic & diluted): Net earnings attributable to controlling interest - income available to common shareholders $ 16,218 $ 110,301 $ 80,300 $ 242,792 Denominator: Denominator for basic earnings per share attributable to controlling interest - weighted average common shares 48,558 50,381 48,518 50,618 Effect of dilutive securities 772 833 775 914 Denominator for diluted earnings per share attributable to controlling interest - adjusted weighted average common shares 49,330 51,214 49,293 51,532 Basic earnings per share attributable to controlling interest $ 0.33 $ 2.19 $ 1.66 $ 4.80 Diluted earnings per share attributable to controlling interest $ 0.33 $ 2.15 $ 1.63 $ 4.71 |
Segment Operations (Tables)
Segment Operations (Tables) | 6 Months Ended |
Nov. 30, 2022 | |
Segment Reporting [Abstract] | |
Financial Information for Reportable Segments | The following table presents summarized financial information for our reportable operating segments for the periods indicated. Three Months Ended November 30, 2022 (in thousands) Steel Processing Consumer Products Building Products Sustainable Energy Solutions Other Consolidated Net sales $ 841,947 $ 153,795 $ 141,671 $ 38,128 $ - $ 1,175,541 Restructuring and other income, net ( 4,282 ) - - - - ( 4,282 ) Separation costs - - - - 9,246 9,246 Miscellaneous income (expense), net 850 ( 47 ) 76 142 384 1,405 Equity in net income (loss) of unconsolidated affiliates 1,906 - 35,107 - ( 156 ) 36,857 Adjusted EBIT (1)(2) ( 17,249 ) 13,473 41,224 1,143 ( 3,291 ) 35,300 (1) Excludes the noncontrolling interest portion of the restructuring gains within Steel Processing of $ 1,850 . (2) Excludes $ 525 in selling, general and administrative expense in Consumer Products related to incremental expense attributable to the Level5 earnout; excludes $ 9,246 of Separation costs in Other related to direct and incremental costs incurred in connection with the anticipated Separation, including audit, advisory, and legal costs. Three Months Ended November 30, 2021 (in thousands) Steel Processing Consumer Products Building Products Sustainable Energy Solutions Other Consolidated Net sales $ 937,842 $ 140,793 $ 121,125 $ 33,101 $ - $ 1,232,861 Restructuring and other income, net ( 182 ) - - - ( 1,822 ) ( 2,004 ) Miscellaneous income, net 17 159 218 82 564 1,040 Equity in net income of unconsolidated affiliates 8,823 - 49,894 - 1,501 60,218 Adjusted EBIT (3) 71,925 17,584 54,718 796 1,893 146,916 (3) Excludes the noncontrolling interest portion of the restructuring gains within Steel Processing of $ 81 . Six Months Ended November 30, 2022 (in thousands) Steel Processing Consumer Products Building Products Sustainable Energy Solutions Other Consolidated Net sales $ 1,880,827 $ 342,497 $ 291,994 $ 68,888 $ - $ 2,584,206 Impairment of long-lived assets 312 - - - - 312 Restructuring and other income, net ( 4,205 ) - - - ( 1,177 ) ( 5,382 ) Separation costs - - - - 9,246 9,246 Miscellaneous income (expense), net 1,035 ( 82 ) 299 56 ( 4,989 ) ( 3,681 ) Equity in net income (loss) of unconsolidated affiliates 3,676 - 78,973 - ( 14,080 ) 68,569 Adjusted EBIT (4)(5) 17,663 34,406 93,959 ( 250 ) 1,854 147,632 (4) Excludes a non-cash settlement charge of $ 4,774 in miscellaneous income (expense), net within Other to accelerate a portion of deferred pension cost as a result of a pension lift-out transaction executed with a third-party insurance company to transfer a portion of the total projected benefit obligation of The Gerstenslager Company Bargaining Unit Employees’ Pension Plan to the third-party insurance company; excludes a loss of $ 15,759 in equity in net income (loss) of unconsolidated affiliates within Other related to the sale of the Company’s 50 % noncontrolling equity investment in ArtiFlex effective August 3, 2022; excludes $ 1,050 in selling, general and administrative expense in Consumer Products related to incremental compensation expense attributable to the Level5 earnout; and excludes $ 9,246 of Separation costs in Other related to direct and incremental costs incurred in connection with the anticipated Separation, including audit, advisory, and legal costs. (5) Excludes the noncontrolling interest portion of the impairment charge and restructuring gains within Steel Processing of $ 1,734 . Six Months Ended November 30, 2021 (in thousands) Steel Processing Consumer Products Building Products Sustainable Energy Solutions Other Consolidated Net sales $ 1,760,652 $ 288,576 $ 235,868 $ 58,583 $ - $ 2,343,679 Restructuring and other income, net ( 12,313 ) - - ( 143 ) ( 1,822 ) ( 14,278 ) Miscellaneous income, net 47 209 144 22 1,248 1,670 Equity in net income of unconsolidated affiliates 18,172 - 92,887 - 2,075 113,134 Adjusted EBIT (6) 179,617 38,140 103,471 ( 1,760 ) 1,479 320,947 (6) Excludes the noncontrolling interest portion of the restructuring gains within Steel Processing of $ 6,027 . Total assets for each of our operating segments as of the dates indicated were as follows: November 30, May 31, (in thousands) 2022 2022 Total assets Steel Processing $ 1,796,136 $ 2,082,522 Consumer Products 627,474 577,026 Building Products 645,566 681,188 Sustainable Energy Solutions 120,978 114,084 Other 200,506 188,203 Total assets $ 3,390,660 $ 3,643,023 |
Acquisitions (Tables)
Acquisitions (Tables) - Level5 Tools, LLC | 6 Months Ended |
Nov. 30, 2022 | |
Schedule of Acquisition of Intangible Assets | In connection with the acquisition of Level5, we identified and valued the following intangible assets: (in thousands) Category Amount Useful Life (Years) Trade name $ 13,500 Indefinite Customer relationships 13,300 10 Technological know-how 6,500 20 Non-compete agreement 280 3 Total acquired identifiable intangible assets $ 33,580 |
Schedule of Consideration Transferred for the Assets and the Preliminary Fair Value Assigned to Assets Acquired and Liabilities Assumed | The following table summarizes the consideration transferred and the estimated fair value assigned to the assets acquired and liabilities assumed at the acquisition date. (in thousands) Preliminary Measurement Revised Cash and cash equivalents $ 1,515 $ - $ 1,515 Accounts receivable 2,860 - 2,860 Inventories 9,161 - 9,161 Prepaid expenses 64 - 64 Property, plant and equipment 273 - 273 Intangible assets 33,580 - 33,580 Operating lease assets 377 - 377 Total identifiable assets 47,830 - 47,830 Accounts payable ( 3,175 ) - ( 3,175 ) Accrued expenses ( 904 ) 151 ( 753 ) Current operating lease liabilities ( 111 ) - ( 111 ) Noncurrent operating lease liabilities ( 266 ) - ( 266 ) Net identifiable assets 43,374 151 43,525 Goodwill 15,947 - 15,947 Total purchase price 59,321 151 59,472 Less: Fair value of earnout ( 2,000 ) - ( 2,000 ) Plus: Net working capital deficit 282 ( 151 ) 131 Cash purchase price $ 57,603 $ - $ 57,603 |
Derivative Financial Instrume_2
Derivative Financial Instruments and Hedging Activities (Tables) | 6 Months Ended |
Nov. 30, 2022 | |
Schedule of Fair Value of Derivative Instruments | The following table summarizes the fair value of our derivative financial instruments and the respective lines in which they were recorded in the consolidated balance sheet at November 30, 2022: Asset Derivatives Liability Derivatives Balance Balance Sheet Fair Sheet Fair (in thousands) Location Value Location Value Derivatives designated as hedging instruments: Commodity contracts Receivables $ 140 Accounts payable $ 16,830 Other assets - Other liabilities 941 140 17,771 Foreign currency exchange contracts Other assets 258 Accounts payable - Total $ 398 $ 17,771 Derivatives not designated as hedging instruments: Commodity contracts Receivables $ 4,622 Accounts payable $ 2,155 Other assets 18 Other liabilities 275 4,640 2,430 Foreign currency exchange contracts Receivables - Accounts payable 94 Total $ 4,640 $ 2,524 Total derivative financial instruments $ 5,038 $ 20,295 The following table summarizes the fair value of our derivative financial instruments and the respective lines in which they were recorded in the consolidated balance sheet at May 31, 2022: Asset Derivatives Liability Derivatives Balance Balance Sheet Fair Sheet Fair (in thousands) Location Value Location Value Derivatives designated as hedging instruments: Commodity contracts Receivables $ 1,040 Accounts payable $ 4,517 Other assets - Other liabilities 48 1,040 4,565 Foreign currency exchange contracts Receivables - Accounts payable - Other assets - Other liabilities 17 - 17 Total $ 1,040 $ 4,582 Derivatives not designated as hedging instruments: Commodity contracts Receivables $ 11,555 Accounts payable $ 4,142 Other assets 48 Other liabilities 24 11,603 4,166 Foreign currency exchange contracts Receivables - Accounts payable 255 Total $ 11,603 $ 4,421 Total derivative financial instruments $ 12,643 $ 9,003 |
Schedule of Summary of Derivative Hedges | The following table summarizes our economic (non-designated) derivative financial instruments outstanding at November 30, 2022: Notional (in thousands) Amount Maturity Date(s) Commodity contracts $ 5,100 December 2022 - December 2023 Foreign currency exchange contracts $ 15,096 December 2022 |
Schedule of Derivative Financials Designated as Cash Flow Hedging Instruments | The following table summarizes the gain (loss) recognized in OCI and the gain (loss) reclassified from Accumulated Other Comprehensive Income (Loss) (“AOCI”) into net earnings for derivative financial instruments designated as cash flow hedges for the periods presented: (in thousands) Gain (Loss) Location of Gain (Loss) Gain (Loss) Reclassified For the three months ended November 30, 2022: Commodity contracts $ ( 19,641 ) Cost of goods sold $ ( 13,648 ) Interest rate contracts - Interest expense ( 7 ) Foreign currency exchange contracts 376 Net sales/Cost of goods sold 53 Total $ ( 19,265 ) $ ( 13,602 ) For the three months ended November 30, 2021: Commodity contracts $ ( 21,002 ) Cost of goods sold $ 47,706 Interest rate contracts - Interest expense 27 Foreign currency exchange contracts 60 Miscellaneous income, net 3 Total $ ( 20,942 ) $ 47,736 For the six months ended November 30, 2022: Commodity contracts $ ( 36,099 ) Cost of goods sold $ ( 13,192 ) Interest rate contracts - Interest expense ( 13 ) Foreign currency exchange contracts 58 Net sales/Cost of goods sold ( 74 ) Total $ ( 36,041 ) $ ( 13,279 ) For the six months ended November 30, 2021: Commodity contracts $ 14,218 Cost of goods sold $ 83,165 Interest rate contracts - Interest expense ( 13 ) Foreign currency exchange contracts 61 Miscellaneous income, net 3 Total $ 14,279 $ 83,155 |
Schedule of Gain (Loss) Recognized in Earnings for Economic (Non-Designated) Derivative Financial Instruments | The following table summarizes the gain (loss) recognized in earnings for economic (non-designated) derivative financial instruments for the periods presented: Gain (Loss) Recognized In Earnings for the Location of Gain (Loss) Three Months Ended November 30, (in thousands) Recognized in Earnings 2022 2021 Commodity contracts Cost of goods sold $ 3,861 $ ( 10,135 ) Foreign currency exchange contracts Miscellaneous income, net ( 47 ) ( 588 ) Total $ 3,814 $ ( 10,723 ) Gain (Loss) Recognized in Earnings for the Location of Gain (Loss) Six Months Ended November 30, (in thousands) Recognized in Earnings 2022 2021 Commodity contracts Cost of goods sold $ 2,284 $ ( 19,392 ) Foreign currency exchange contracts Miscellaneous income, net ( 141 ) ( 249 ) Total $ 2,143 $ ( 19,641 ) |
Cash Flow Hedges | |
Schedule of Summary of Derivative Hedges | The following table summarizes our cash flow hedges outstanding at November 30, 2022: Notional (in thousands) Amount Maturity Date Commodity contracts $ 114,516 December 2022 - December 2023 Foreign currency exchange contracts $ 1,751 January 2023 - July 2023 |
Fair Value (Tables)
Fair Value (Tables) | 6 Months Ended |
Nov. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis | At November 30, 2022, our assets and liabilities measured at fair value on a recurring basis were as follows: Significant Quoted Prices Other Significant in Active Observable Unobservable Markets Inputs Inputs (in thousands) (Level 1) (Level 2) (Level 3) Totals Assets Derivative financial instruments (1) $ - $ 5,038 $ - $ 5,038 Total assets $ - $ 5,038 $ - $ 5,038 Liabilities Derivative financial instruments (1) $ - $ 20,295 $ - $ 20,295 Total liabilities $ - $ 20,295 $ - $ 20,295 At May 31, 2022, our assets and liabilities measured at fair value on a recurring basis were as follows: Significant Quoted Prices Other Significant in Active Observable Unobservable Markets Inputs Inputs (in thousands) (Level 1) (Level 2) (Level 3) Totals Assets Derivative financial instruments (1) $ - $ 12,643 $ - $ 12,643 Total assets $ - $ 12,643 $ - $ 12,643 Liabilities Derivative financial instruments (1) $ - $ 9,003 $ - $ 9,003 Total liabilities $ - $ 9,003 $ - $ 9,003 (1) The fair value of our derivative financial instruments is based on the present value of the expected future cash flows considering the risks involved, including non-performance risk, and using discount rates appropriate for the respective maturities. Market observable, Level 2 inputs are used to determine the present value of the expected future cash flows. Refer to “ Note Q – Derivative Financial Instruments and Hedging Activities ” for additional information regarding our use of derivative financial instruments. |
Assets Measured at Fair Value on Non-Recurring Basis | At May 31, 2022, our assets measured at fair value on a non-recurring basis were as follows: Significant Quoted Prices Other Significant in Active Observable Unobservable Markets Inputs Inputs (in thousands) (Level 1) (Level 2) (Level 3) Totals Assets Long-lived assets held for sale (1) $ - $ 700 $ - $ 700 Total assets $ - $ 700 $ - $ 700 (1) Comprised of production equipment at our Twinsburg, Ohio facility with an estimated fair market value of $ 700,000 . |
Basis of Presentation - Additio
Basis of Presentation - Additional Information (Detail) | 3 Months Ended | 6 Months Ended |
Nov. 30, 2022 USD ($) Jointventure | Nov. 30, 2022 USD ($) Jointventure | |
Significant Accounting Policies [Line Items] | ||
Separation costs | $ | $ 9,246,000 | $ 9,246,000 |
Joint Venture Transactions | ||
Significant Accounting Policies [Line Items] | ||
Number of operating joint ventures | Jointventure | 3 | 3 |
Spartan | Joint Venture Transactions | ||
Significant Accounting Policies [Line Items] | ||
Percent of controlling interest by the Company | 52% | 52% |
TWB | Joint Venture Transactions | ||
Significant Accounting Policies [Line Items] | ||
Percent of controlling interest by the Company | 55% | 55% |
Samuel | Joint Venture Transactions | ||
Significant Accounting Policies [Line Items] | ||
Percent of controlling interest by the Company | 63% | 63% |
Inventory - Additional Informat
Inventory - Additional Information (Detail) - USD ($) | 3 Months Ended | |
Nov. 30, 2022 | Aug. 31, 2022 | |
Steel Processing | ||
Inventory [Line Items] | ||
Lower of cost or net realizable value adjustment | $ 0 | $ 4,488,000 |
Revenue Recognition - Revenue b
Revenue Recognition - Revenue by Product Class and Timing (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Nov. 30, 2022 | Nov. 30, 2021 | Nov. 30, 2022 | Nov. 30, 2021 | |||
Disaggregation Of Revenue [Line Items] | ||||||
Net sales | $ 1,175,541 | $ 1,232,861 | $ 2,584,206 | $ 2,343,679 | ||
Steel Processing | ||||||
Disaggregation Of Revenue [Line Items] | ||||||
Net sales | 841,947 | 937,842 | 1,880,827 | 1,760,652 | ||
Direct | Steel Processing | ||||||
Disaggregation Of Revenue [Line Items] | ||||||
Net sales | 807,259 | 900,666 | 1,809,394 | 1,688,694 | ||
Toll | Steel Processing | ||||||
Disaggregation Of Revenue [Line Items] | ||||||
Net sales | 34,688 | 37,176 | 71,433 | 71,958 | ||
Toll | Steel Processing | Over time revenue | ||||||
Disaggregation Of Revenue [Line Items] | ||||||
Net sales | 34,688 | 37,176 | 71,433 | 71,958 | ||
Building Products | ||||||
Disaggregation Of Revenue [Line Items] | ||||||
Net sales | 141,671 | [1] | 121,125 | [1] | 291,994 | 235,868 |
Consumer products | ||||||
Disaggregation Of Revenue [Line Items] | ||||||
Net sales | 153,795 | [1] | 140,793 | [1] | 342,497 | 288,576 |
Sustainable Energy Solutions | ||||||
Disaggregation Of Revenue [Line Items] | ||||||
Net sales | $ 38,128 | [1] | $ 33,101 | [1] | $ 68,888 | $ 58,583 |
[1] The products contained within each of these operating segments have similar production processes, require substantially the same raw materials, use similar equipment, and serve similar purposes. Therefore, we believe the products within each of these segments are appropriately combined for purposes of the disclosure requirements prescribed by Accounting Standards Codification (“ASC”) Topic 280 and Topic 606. |
Revenue Recognition - Summary o
Revenue Recognition - Summary of Unbilled Receivables (Detail) - USD ($) $ in Thousands | Nov. 30, 2022 | May 31, 2022 |
Receivables | ||
Unbilled Receivables And Contract Assets [Line Items] | ||
Unbilled receivables | $ 3,192 | $ 5,001 |
Revenue Recognition - Additiona
Revenue Recognition - Additional Information (Detail) - USD ($) $ in Thousands | Nov. 30, 2022 | May 31, 2022 |
Revenue from Contract with Customer [Abstract] | ||
Contract assets | $ 0 | $ 0 |
Amount of performance obligation related to contracts with expected duration greater than one year | $ 0 |
Investments in Unconsolidated_3
Investments in Unconsolidated Affiliates - Additional Information (Detail) - USD ($) | 6 Months Ended | ||
Aug. 03, 2022 | Nov. 30, 2022 | May 31, 2022 | |
Investments in and Advances to Affiliates [Line Items] | |||
Distributions from unconsolidated affiliates | $ 129,766,000 | ||
Investments in unconsolidated affiliates | 240,859,000 | $ 327,381,000 | |
Pre-tax loss on sale of equity | $ (15,759,000) | ||
ArtiFlex | |||
Investments in and Advances to Affiliates [Line Items] | |||
Percent of ownership interest held in unconsolidated affiliates | 50% | ||
Equity method investment ownership percentage sold | 50% | ||
Equity method investment sold amount after adjustments for closing debt and final net working capital | $ 42,086,000 | ||
Pre-tax loss on sale of equity | (15,759,000) | ||
ArtiFlex | Real Property | |||
Investments in and Advances to Affiliates [Line Items] | |||
Investments in unconsolidated affiliates | 6,300,000 | ||
ArtiFlex | Ohio | Real Property | |||
Investments in and Advances to Affiliates [Line Items] | |||
Cash proceeds from sale of equity method investment | $ 6,000,000 | ||
ClarkDietrich | |||
Investments in and Advances to Affiliates [Line Items] | |||
Percent of ownership interest held in unconsolidated affiliates | 25% | ||
Workhorse | |||
Investments in and Advances to Affiliates [Line Items] | |||
Percent of ownership interest held in unconsolidated affiliates | 20% | ||
Serviacero Worthington | |||
Investments in and Advances to Affiliates [Line Items] | |||
Percent of ownership interest held in unconsolidated affiliates | 50% | ||
WAVE | |||
Investments in and Advances to Affiliates [Line Items] | |||
Percent of ownership interest held in unconsolidated affiliates | 50% | ||
Investments in unconsolidated affiliates | $ 91,643,000 |
Investments in Unconsolidated_4
Investments in Unconsolidated Affiliates - Schedule of Combined Financial Information for Unconsolidated Affiliates (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||||
Nov. 30, 2022 | Aug. 31, 2022 | Nov. 30, 2021 | Aug. 31, 2021 | Nov. 30, 2022 | Nov. 30, 2021 | May 31, 2022 | |
Investments in and Advances to Affiliates [Line Items] | |||||||
Cash and cash equivalents | $ 129,596 | $ 129,596 | $ 34,485 | ||||
Total assets | 3,390,660 | 3,390,660 | 3,643,023 | ||||
Current liabilities | 660,891 | 660,891 | 932,261 | ||||
Short-term borrowings | 4,935 | 4,935 | 47,997 | ||||
Current maturities of long-term debt | 257 | 257 | 265 | ||||
Long-term debt | 693,453 | 693,453 | 696,345 | ||||
Other noncurrent liabilities | 115,688 | 115,688 | 115,991 | ||||
Equity | 1,513,393 | 1,513,393 | 1,480,752 | ||||
Total liabilities and equity | 3,390,660 | 3,390,660 | 3,643,023 | ||||
Net sales | 1,175,541 | $ 1,232,861 | 2,584,206 | $ 2,343,679 | |||
Gross margin | 105,763 | 184,591 | 275,137 | 403,965 | |||
Operating income | (7,014) | 90,465 | 59,700 | 226,262 | |||
Depreciation and amortization | 28,354 | 21,090 | 56,355 | 43,154 | |||
Income tax expense | 4,131 | 31,226 | 23,629 | 71,376 | |||
Net earnings | 19,505 | $ 65,244 | 113,185 | $ 141,475 | 84,749 | 254,660 | |
Equity Method Investment, Nonconsolidated Investee, Other | |||||||
Investments in and Advances to Affiliates [Line Items] | |||||||
Cash and cash equivalents | 41,768 | 41,768 | 68,563 | ||||
Other current assets | 911,881 | 911,881 | 1,148,029 | ||||
Noncurrent assets | 301,027 | 301,027 | 369,608 | ||||
Total assets | 1,254,676 | 1,254,676 | 1,586,200 | ||||
Current liabilities | 292,303 | 292,303 | 345,097 | ||||
Short-term borrowings | 10,000 | 10,000 | 5,943 | ||||
Current maturities of long-term debt | 36,110 | 36,110 | 33,054 | ||||
Long-term debt | 304,108 | 304,108 | 306,814 | ||||
Other noncurrent liabilities | 69,667 | 69,667 | 76,437 | ||||
Equity | 542,488 | 542,488 | 818,855 | ||||
Total liabilities and equity | 1,254,676 | 1,254,676 | $ 1,586,200 | ||||
Net sales | 711,665 | 858,165 | 1,535,607 | 1,603,160 | |||
Gross margin | 147,299 | 226,502 | 328,704 | 416,176 | |||
Operating income | 107,356 | 184,779 | 245,183 | 330,767 | |||
Depreciation and amortization | 6,864 | 7,848 | 15,052 | 16,075 | |||
Interest expense | 3,910 | 2,711 | 6,590 | 5,172 | |||
Income tax expense | 1,262 | 8,565 | 3,372 | 16,461 | |||
Net earnings | $ 105,183 | $ 173,915 | $ 238,421 | $ 312,803 |
Impairment of Long-Lived Asse_2
Impairment of Long-Lived Assets - Additional Information (Detail) - USD ($) | 3 Months Ended | 6 Months Ended | |
Nov. 30, 2022 | Aug. 31, 2022 | Nov. 30, 2021 | |
Impaired Long-Lived Assets Held and Used [Line Items] | |||
Impairment charge of long-lived assets | $ 0 | $ 312,000 | $ 0 |
Long Lived Assets Held for Sale | |||
Impaired Long-Lived Assets Held and Used [Line Items] | |||
Fixed asset net book value | 1,562,000 | ||
Cleveland | |||
Impaired Long-Lived Assets Held and Used [Line Items] | |||
Net cash proceeds | $ 3,298,000 |
Goodwill and Long-Lived Assets
Goodwill and Long-Lived Assets - Summary of Changes in Carrying Amount of Goodwill (Detail) - USD ($) $ in Thousands | Nov. 30, 2022 | Jun. 02, 2022 |
Goodwill [Line Items] | ||
Balance | $ 401,469 | |
Balance | $ 412,971 |
Goodwill and Long-Lived Asset_2
Goodwill and Long-Lived Assets - Additional Information (Detail) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Nov. 30, 2022 | Aug. 31, 2022 | Nov. 30, 2022 | Nov. 30, 2021 | May 31, 2022 | ||
Impaired Long Lived Assets Held And Used [Line Items] | ||||||
Goodwill | $ 412,971,000 | $ 412,971,000 | $ 401,469,000 | |||
Impairment of long-lived assets | 0 | $ 312,000 | $ 0 | |||
Impairment of long-lived assets | 312,000 | |||||
Fair Value, Nonrecurring | ||||||
Impaired Long Lived Assets Held And Used [Line Items] | ||||||
Fair market value of assets | 0 | 0 | 700,000 | |||
Fair Value, Nonrecurring | Fair Value, Inputs, Level 2 | ||||||
Impaired Long Lived Assets Held And Used [Line Items] | ||||||
Fair market value of assets | 700,000 | |||||
Long Lived Assets Held for Sale | ||||||
Impaired Long Lived Assets Held And Used [Line Items] | ||||||
Fixed asset net book value | $ 1,562,000 | $ 1,562,000 | ||||
Long Lived Assets Held for Sale | Fair Value, Nonrecurring | ||||||
Impaired Long Lived Assets Held And Used [Line Items] | ||||||
Fair market value of assets | [1] | 700,000 | ||||
Long Lived Assets Held for Sale | Fair Value, Nonrecurring | Fair Value, Inputs, Level 2 | ||||||
Impaired Long Lived Assets Held And Used [Line Items] | ||||||
Fair market value of assets | [1] | $ 700,000 | ||||
[1] Comprised of production equipment at our Twinsburg, Ohio facility with an estimated fair market value of $ 700,000 . |
Restructuring and Other Incom_3
Restructuring and Other Income, Net - Schedule of Progression of Liabilities Associated with Restructuring Activities, Combined with Reconciliation to Restructuring and Other Income, Net (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Nov. 30, 2022 | Nov. 30, 2021 | Nov. 30, 2022 | Nov. 30, 2021 | ||
Restructuring Cost and Reserve [Line Items] | |||||
Net gain on sale of assets | [1],[2] | $ 5,467 | |||
Restructuring and other income, net | $ (4,282) | $ (2,004) | (5,382) | $ (14,278) | |
Early Retirement And Severance | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Beginning Balance | 541 | ||||
Expense (Income) | 85 | ||||
Payments | (605) | ||||
Ending Balance | $ 21 | $ 21 | |||
[1] On June 14, 2022, we sold real property in Tulsa, Oklahoma, for net cash proceeds of $ 5,775,000 , resulting in a pre-tax gain of $ 1,177,000 . These assets had been excluded from the sale of our former oil & gas equipment business in January 2021. The assets were classified in assets held for sale on the consolidated balance sheets immediately prior to the closing of the sale. On October 31, 2022, the Company’s consolidated steel processing joint venture, WSP, sold its remaining manufacturing facility, located in Jackson, Michigan. Net proceeds of $ 21,277,000 were realized in connection with the transaction, of which $ 2,000,000 is being held in escrow for general representations and warranties. The transaction resulted in a pre-tax gain of $ 3,926,000 . The assets were classified in assets held for sale on the consolidated balance sheets immediately prior to the closing of the sale. |
Restructuring and Other Incom_4
Restructuring and Other Income, Net - Schedule of Progression of Liabilities Associated with Restructuring Activities, Combined with Reconciliation to Restructuring and Other Income, Net (Parenthetical) (Detail) - USD ($) | 3 Months Ended | ||
Oct. 31, 2022 | Jun. 14, 2022 | Nov. 30, 2022 | |
Tulsa, Oklahoma | |||
Restructuring Cost and Reserve [Line Items] | |||
Net cash proceeds | $ 5,775,000 | ||
Pre-tax gain on sale of joint venture facility | $ 1,177,000 | ||
WSP Joint Venture | |||
Restructuring Cost and Reserve [Line Items] | |||
Net cash proceeds | $ 21,277,000 | ||
Amount held in escrow | 2,000,000 | ||
Pre-tax gain on sale of joint venture facility | $ 3,926,000 | ||
Cleveland [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Net cash proceeds | $ 3,298,000 |
Guarantees - Additional Informa
Guarantees - Additional Information (Detail) | 6 Months Ended |
Nov. 30, 2022 USD ($) | |
Stand-by Letters of Credit | |
Guarantor Obligations [Line Items] | |
Letter of credit amount outstanding | $ 14,137,000 |
Drawn amount of letter of credit outstanding | 0 |
Operating Lease of Aircraft | |
Guarantor Obligations [Line Items] | |
Maximum potential obligation | $ 17,524,000 |
Debt - Additional Information (
Debt - Additional Information (Detail) - USD ($) | 6 Months Ended | |||
Aug. 20, 2021 | Feb. 16, 2018 | Nov. 30, 2022 | May 31, 2022 | |
Debt And Receivables Securitization [Line Items] | ||||
Borrowings outstanding | $ 0 | |||
Short-term loan facilities | 4,935,000 | $ 47,997,000 | ||
Unsecured Revolving Credit Facility | ||||
Debt And Receivables Securitization [Line Items] | ||||
Maximum borrowing capacity | $ 500,000,000 | |||
Maturity date | Aug. 20, 2026 | Feb. 16, 2023 | ||
Line of credit facility, description | We maintain a $500,000,000 multi-year revolving credit facility (the “Credit Facility”) with a group of lenders. On August 20, 2021, we amended and restated the Credit Facility, extending the final maturity from February 16, 2023 to August 20, 2026 while keeping in place the $500,000,000 aggregate commitments under the Credit Facility. Borrowings under the Credit Facility have maturities of up to one year. We have the option to borrow at rates equal to an applicable margin over the Daily LIBOR Rate, the Prime Rate of PNC Bank, National Association or the Overnight Bank Funding Rate. | |||
Remaining borrowing capacity | $ 500,000,000 | |||
Unsecured Revolving Credit Facility | Maximum | ||||
Debt And Receivables Securitization [Line Items] | ||||
Debt maturity period | 1 year | |||
AR Facility | ||||
Debt And Receivables Securitization [Line Items] | ||||
Maximum borrowing capacity | $ 175,000,000 | |||
Borrowings outstanding | 0 | |||
Remaining borrowing capacity | 175,000,000 | |||
Tempel China | ||||
Debt And Receivables Securitization [Line Items] | ||||
Short-term loan facilities | $ 4,935,000 | |||
Short-term loan maturity year | 2023 | |||
Effective interest rate | 3.50% |
Other Comprehensive Income (L_3
Other Comprehensive Income (Loss) - Summary of Tax Effects on Each Component of OCI (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Nov. 30, 2022 | Aug. 31, 2022 | Nov. 30, 2021 | Aug. 31, 2021 | Nov. 30, 2022 | Nov. 30, 2021 | |
Components Of Other Comprehensive Income Loss [Abstract] | ||||||
Foreign currency translation, before tax | $ 550 | $ (4,507) | $ (8,970) | $ (8,124) | ||
Foreign currency translation, tax | 308 | (365) | (273) | (723) | ||
Foreign currency translation, net of tax | 858 | (4,872) | (9,243) | (8,847) | ||
Pension liability adjustment, before tax | 15 | 3,740 | ||||
Pension liability adjustment, tax | (97) | (883) | ||||
Pension liability adjustment, net of tax | (82) | 2,857 | ||||
Cash flow hedges, before tax | (5,665) | (68,677) | (22,762) | (68,876) | ||
Cash flow hedges, tax | 1,665 | 15,691 | 5,462 | 15,591 | ||
Cash flow hedges, net of tax | (4,000) | (52,986) | (17,300) | (53,285) | ||
Other comprehensive income (loss), before tax | (5,100) | (73,184) | (27,992) | (77,000) | ||
Other comprehensive income (loss), tax | 1,876 | 15,326 | 4,306 | 14,868 | ||
Other comprehensive income (loss) | $ (3,224) | $ (20,462) | $ (57,858) | $ (4,274) | $ (23,686) | $ (62,132) |
Changes in Equity - Summary of
Changes in Equity - Summary of Changes in Equity by Component and in Total (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Nov. 30, 2022 | Aug. 31, 2022 | Nov. 30, 2021 | Aug. 31, 2021 | Nov. 30, 2022 | Nov. 30, 2021 | |
Balance | $ 1,646,972 | $ 1,613,962 | $ 1,606,632 | $ 1,551,695 | $ 1,613,962 | $ 1,551,695 |
Net earnings | 19,505 | 65,244 | 113,185 | 141,475 | 84,749 | 254,660 |
Other comprehensive loss | (3,224) | (20,462) | (57,858) | (4,274) | (23,686) | (62,132) |
Common shares issued, net of withholding tax | (649) | (3,466) | (2,694) | (4,091) | ||
Common shares in non-qualified plans | 298 | 136 | 257 | 89 | ||
Stock-based compensation | 3,620 | 6,976 | 3,304 | 6,324 | ||
Purchases and retirement of common shares | (12,702) | (60,885) | ||||
Cash dividends declared | (15,470) | (15,418) | (14,154) | (14,504) | ||
Dividends to noncontrolling interests | (11,760) | (2,879) | (9,197) | |||
Balance | 1,639,292 | 1,646,972 | 1,633,091 | 1,606,632 | 1,639,292 | 1,633,091 |
Additional Paid-in Capital | ||||||
Balance | 277,085 | 273,439 | 279,635 | 282,790 | 273,439 | 282,790 |
Common shares issued, net of withholding tax | (649) | (3,466) | (2,694) | (4,091) | ||
Common shares in non-qualified plans | 298 | 136 | 257 | 89 | ||
Stock-based compensation | 3,620 | 6,976 | 3,304 | 6,324 | ||
Purchases and retirement of common shares | (1,297) | (5,477) | ||||
Balance | 280,354 | 277,085 | 279,205 | 279,635 | 280,354 | 279,205 |
Accumulated Other Comprehensive Income (Loss), Net of Tax | ||||||
Balance | (43,312) | (22,850) | 41,113 | 45,387 | (22,850) | 45,387 |
Other comprehensive loss | (3,224) | (20,462) | (57,858) | (4,274) | ||
Balance | (46,536) | (43,312) | (16,745) | 41,113 | (46,536) | (16,745) |
Retained Earnings | ||||||
Balance | 1,278,827 | 1,230,163 | 1,132,595 | 1,070,016 | 1,230,163 | 1,070,016 |
Net earnings | 16,218 | 64,082 | 110,301 | 132,491 | ||
Purchases and retirement of common shares | (11,405) | (55,408) | ||||
Cash dividends declared | (15,470) | (15,418) | (14,154) | (14,504) | ||
Balance | 1,279,575 | 1,278,827 | 1,217,337 | 1,132,595 | 1,279,575 | 1,217,337 |
Parent | ||||||
Balance | 1,512,600 | 1,480,752 | 1,453,343 | 1,398,193 | 1,480,752 | 1,398,193 |
Net earnings | 16,218 | 64,082 | 110,301 | 132,491 | ||
Other comprehensive loss | (3,224) | (20,462) | (57,858) | (4,274) | ||
Common shares issued, net of withholding tax | (649) | (3,466) | (2,694) | (4,091) | ||
Common shares in non-qualified plans | 298 | 136 | 257 | 89 | ||
Stock-based compensation | 3,620 | 6,976 | 3,304 | 6,324 | ||
Purchases and retirement of common shares | 12,702 | (60,885) | ||||
Cash dividends declared | 15,470 | (15,418) | 14,154 | (14,504) | ||
Balance | 1,513,393 | 1,512,600 | 1,479,797 | 1,453,343 | 1,513,393 | 1,479,797 |
Noncontrolling Interest | ||||||
Balance | 134,372 | 133,210 | 153,289 | 153,502 | 133,210 | 153,502 |
Net earnings | 3,287 | 1,162 | 2,884 | 8,984 | ||
Dividends to noncontrolling interests | 11,760 | 2,879 | (9,197) | |||
Balance | $ 125,899 | $ 134,372 | $ 153,294 | $ 153,289 | $ 125,899 | $ 153,294 |
Changes in Equity - Summary o_2
Changes in Equity - Summary of Changes in Accumulated Other Comprehensive Income (Loss) (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Nov. 30, 2022 | Nov. 30, 2021 | Nov. 30, 2022 | Nov. 30, 2021 | ||
Accumulated Other Comprehensive Income Loss [Line Items] | |||||
Balance | $ 1,646,972 | $ 1,606,632 | $ 1,613,962 | $ 1,551,695 | |
Income tax effect | 1,876 | 15,326 | 4,306 | 14,868 | |
Balance | 1,639,292 | 1,633,091 | 1,639,292 | 1,633,091 | |
Foreign Currency Translation | |||||
Accumulated Other Comprehensive Income Loss [Line Items] | |||||
Balance | (15,310) | 1,779 | |||
Other comprehensive income (loss) before reclassifications | (8,970) | (8,124) | |||
Income tax effect | (273) | (723) | |||
Balance | (24,553) | (7,068) | (24,553) | (7,068) | |
Pension Liability Adjustment | |||||
Accumulated Other Comprehensive Income Loss [Line Items] | |||||
Balance | (6,244) | (15,955) | |||
Other comprehensive income (loss) before reclassifications | (1,034) | ||||
Reclassification adjustments to net earnings | [1] | 4,774 | |||
Income tax effect | (883) | ||||
Balance | (3,387) | (15,955) | (3,387) | (15,955) | |
Cash Flow Hedges | |||||
Accumulated Other Comprehensive Income Loss [Line Items] | |||||
Balance | (1,296) | 59,563 | |||
Other comprehensive income (loss) before reclassifications | (36,041) | 14,279 | |||
Reclassification adjustments to net earnings | [1] | 13,279 | (83,155) | ||
Income tax effect | 5,462 | 15,591 | |||
Balance | (18,596) | 6,278 | (18,596) | 6,278 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax | |||||
Accumulated Other Comprehensive Income Loss [Line Items] | |||||
Balance | (43,312) | 41,113 | (22,850) | 45,387 | |
Other comprehensive income (loss) before reclassifications | (46,045) | 6,155 | |||
Reclassification adjustments to net earnings | [1] | 18,053 | (83,155) | ||
Income tax effect | 4,306 | 14,868 | |||
Balance | $ (46,536) | $ (16,745) | $ (46,536) | $ (16,745) | |
[1] The statement of earnings classification of amounts reclassified to net earnings include: 1. Pension liability adjustment – During August 2022, we purchased (using pension plan assets) an annuity contract from a third-party insurance company to transfer approximately 31 % of the total projected benefit obligation of The Gerstenslager Company Bargaining Unit Employees’ Pension Plan as of the purchase date. As a result of this transaction: 1) we incurred a non-cash settlement charge of $ 4,774,000 within “Miscellaneous income (expense), net”; 2) we were relieved of all responsibility for these pension obligations; and 3) the insurance company is now required to pay and administer the retirement benefits owed to 220 benefi ciaries; and 2. Cash flow hedges – disclosed in “Note Q – Derivative Financial Instruments and Hedging Activities ”. |
Changes in Equity - Summary o_3
Changes in Equity - Summary of Changes in Accumulated Other Comprehensive Income (Loss) (Parenthetical) (Detail) - Gerstenslager Company | 3 Months Ended |
Aug. 31, 2022 USD ($) Beneficiary | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Defined benefit plan, funded percentage | 31% |
Defined benefit plan, benefit obligation, non-cash settlement charge | $ | $ 4,774,000 |
Number of beneficiaries owed | Beneficiary | 220 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Detail) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 24, 2022 | Nov. 30, 2022 | Nov. 30, 2021 | Nov. 30, 2022 | Nov. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Pre-tax stock-based compensation expense | $ 4,547,000 | $ 4,248,000 | $ 8,783,000 | $ 7,551,000 | |
Non-Qualified Stock Options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Non-qualified stock options, granted | 84,400 | ||||
Non-qualified stock option, per share weighted average price | $ 46.39 | ||||
Non-qualified stock option, fair value, per share price | $ 16.36 | ||||
Pre-tax stock-based compensation, period of recognition | 3 years | ||||
Pre-tax stock-based compensation expense | $ 1,381,000 | ||||
Service-Based Restricted Common Shares | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Pre-tax stock-based compensation, period of recognition | 3 years | ||||
Pre-tax stock-based compensation expense | $ 15,216,000 | ||||
Restricted common shares, granted | 308,000 | ||||
Restricted common shares, fair value per share | $ 51.09 | ||||
Performance Shares | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Pre-tax stock-based compensation expense | $ 2,695,000 | ||||
Restricted common shares, granted | 58,100 | ||||
Pre-tax stock-based compensation, period of recognition | 3 years | ||||
Market-Based Restricted Common Shares | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Pre-tax stock-based compensation, period of recognition | 3 years | ||||
Restricted common shares, granted | 10,000 | ||||
Common share awards vesting, minimum price per share | $ 65 | ||||
Common share awards vesting, minimum consecutive days at stated price | 90 days | ||||
Restricted common shares, fair value per share | $ 35.49 | ||||
Pre-tax stock-based compensation | $ 355,000 |
Stock-Based Compensation - Assu
Stock-Based Compensation - Assumptions To Value Stock Options (Detail) - Non-Qualified Stock Options | 6 Months Ended |
Nov. 30, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Dividend yield | 2.33% |
Expected volatility | 41.63% |
Risk-free interest rate | 3.19% |
Expected term (years) | 6 years |
Share-Based Compensation - Sche
Share-Based Compensation - Schedule of Assumptions Used to Determine Grant Date Fair Value of Market Based Restricted Common Shares (Details) - Market-Based Restricted Common Shares | Jun. 24, 2022 |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Dividend yield | 2.67% |
Expected volatility | 43% |
Risk-free interest rate | 3.18% |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) | 6 Months Ended | |
Nov. 30, 2022 | Nov. 30, 2021 | |
Income Tax Disclosure [Abstract] | ||
Estimated annual effective income tax rate | 23.70% | 22.80% |
Earnings Per Share - Computatio
Earnings Per Share - Computation of Basic and Diluted Earnings Per Share Attributable to Controlling Interest (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Nov. 30, 2022 | Nov. 30, 2021 | Nov. 30, 2022 | Nov. 30, 2021 | |
Numerator (basic & diluted): | ||||
Net earnings attributable to controlling interest - income available to common shareholders | $ 16,218 | $ 110,301 | $ 80,300 | $ 242,792 |
Denominator: | ||||
Denominator for basic earnings share attributable to controlling interest - weighted average common shares | 48,558 | 50,381 | 48,518 | 50,618 |
Effect of dilutive securities | 772 | 833 | 775 | 914 |
Denominator for diluted earnings per share attributable to controlling interest - adjusted weighted average common shares | 49,330 | 51,214 | 49,293 | 51,532 |
Basic earnings per share attributable to controlling interest | $ 0.33 | $ 2.19 | $ 1.66 | $ 4.80 |
Diluted earnings per share attributable to controlling interest | $ 0.33 | $ 2.15 | $ 1.63 | $ 4.71 |
Earnings Per Share - Additional
Earnings Per Share - Additional Information (Detail) - shares | 3 Months Ended | 6 Months Ended | ||
Nov. 30, 2022 | Nov. 30, 2021 | Nov. 30, 2022 | Nov. 30, 2021 | |
Earnings Per Share [Abstract] | ||||
Shares excluded from computation of diluted earnings per share | 138,100 | 54,500 | 127,492 | 47,352 |
Segment Operations - Financial
Segment Operations - Financial Information for Reportable Segments (Detail) - USD ($) | 3 Months Ended | 6 Months Ended | ||||||||
Nov. 30, 2022 | Aug. 31, 2022 | Nov. 30, 2021 | Nov. 30, 2022 | Nov. 30, 2021 | May 31, 2022 | |||||
Segment Reporting Information [Line Items] | ||||||||||
Net sales | $ 1,175,541,000 | $ 1,232,861,000 | $ 2,584,206,000 | $ 2,343,679,000 | ||||||
Impairment of long-lived assets | 0 | $ 312,000 | 0 | |||||||
Restructuring and other income, net | (4,282,000) | (2,004,000) | (5,382,000) | (14,278,000) | ||||||
Miscellaneous income (expense), net | 1,405,000 | 1,040,000 | (3,681,000) | 1,670,000 | ||||||
Equity in net income (loss) of unconsolidated affiliates | 36,857,000 | 60,218,000 | 68,569,000 | 113,134,000 | ||||||
Adjusted EBIT | 23,636,000 | 144,411,000 | 108,378,000 | 326,036,000 | ||||||
Total assets | 3,390,660,000 | 3,390,660,000 | $ 3,643,023,000 | |||||||
Steel Processing | ||||||||||
Segment Reporting Information [Line Items] | ||||||||||
Net sales | 841,947,000 | 937,842,000 | 1,880,827,000 | 1,760,652,000 | ||||||
Impairment of long-lived assets | 312,000 | |||||||||
Restructuring and other income, net | (4,282,000) | (182,000) | (4,205,000) | (12,313,000) | ||||||
Miscellaneous income (expense), net | 850,000 | 17,000 | 1,035,000 | 47,000 | ||||||
Equity in net income (loss) of unconsolidated affiliates | 1,906,000 | 8,823,000 | 3,676,000 | 18,172,000 | ||||||
Adjusted EBIT | (17,249,000) | [1],[2] | 71,925,000 | [3] | 17,663,000 | [4],[5] | 179,617,000 | [6] | ||
Total assets | 1,796,136,000 | 1,796,136,000 | 2,082,522,000 | |||||||
Consumer products | ||||||||||
Segment Reporting Information [Line Items] | ||||||||||
Net sales | 153,795,000 | 140,793,000 | 342,497,000 | 288,576,000 | ||||||
Miscellaneous income (expense), net | (47,000) | 159,000 | (82,000) | 209,000 | ||||||
Adjusted EBIT | 13,473,000 | [1],[2] | 17,584,000 | [3] | 34,406,000 | [4],[5] | 38,140,000 | [6] | ||
Total assets | 627,474,000 | 627,474,000 | 577,026,000 | |||||||
Building Products | ||||||||||
Segment Reporting Information [Line Items] | ||||||||||
Net sales | 141,671,000 | 121,125,000 | 291,994,000 | 235,868,000 | ||||||
Miscellaneous income (expense), net | 76,000 | 218,000 | 299,000 | 144,000 | ||||||
Equity in net income (loss) of unconsolidated affiliates | 35,107,000 | 49,894,000 | 78,973,000 | 92,887,000 | ||||||
Adjusted EBIT | 41,224,000 | [1],[2] | 54,718,000 | [3] | 93,959,000 | [4],[5] | 103,471,000 | [6] | ||
Total assets | 645,566,000 | 645,566,000 | 681,188,000 | |||||||
Sustainable Energy Solutions | ||||||||||
Segment Reporting Information [Line Items] | ||||||||||
Net sales | 38,128,000 | 33,101,000 | 68,888,000 | 58,583,000 | ||||||
Restructuring and other income, net | (143,000) | |||||||||
Miscellaneous income (expense), net | 142,000 | 82,000 | 56,000 | 22,000 | ||||||
Adjusted EBIT | 1,143,000 | [1],[2] | 796,000 | [3] | (250,000) | [4],[5] | (1,760,000) | [6] | ||
Total assets | 120,978,000 | 120,978,000 | 114,084,000 | |||||||
Other | ||||||||||
Segment Reporting Information [Line Items] | ||||||||||
Restructuring and other income, net | (1,822,000) | (1,177,000) | (1,822,000) | |||||||
Separation costs | 9,246,000 | 9,246,000 | ||||||||
Miscellaneous income (expense), net | 384,000 | 564,000 | (4,989,000) | 1,248,000 | ||||||
Equity in net income (loss) of unconsolidated affiliates | (156,000) | 1,501,000 | (14,080,000) | 2,075,000 | ||||||
Adjusted EBIT | (3,291,000) | [1],[2] | 1,893,000 | [3] | 1,854,000 | [4],[5] | 1,479,000 | [6] | ||
Total assets | 200,506,000 | 200,506,000 | $ 188,203,000 | |||||||
Consolidated | ||||||||||
Segment Reporting Information [Line Items] | ||||||||||
Net sales | 1,175,541,000 | 1,232,861,000 | 2,584,206,000 | 2,343,679,000 | ||||||
Impairment of long-lived assets | 312,000 | |||||||||
Restructuring and other income, net | (4,282,000) | (2,004,000) | (5,382,000) | (14,278,000) | ||||||
Separation costs | 9,246,000 | 9,246,000 | ||||||||
Miscellaneous income (expense), net | 1,405,000 | 1,040,000 | (3,681,000) | 1,670,000 | ||||||
Equity in net income (loss) of unconsolidated affiliates | 36,857,000 | 60,218,000 | 68,569,000 | 113,134,000 | ||||||
Adjusted EBIT | $ 35,300,000 | [1],[2] | $ 146,916,000 | [3] | $ 147,632,000 | [4],[5] | $ 320,947,000 | [6] | ||
[1] Excludes $ 525 in selling, general and administrative expense in Consumer Products related to incremental expense attributable to the Level5 earnout; excludes $ 9,246 of Separation costs in Other related to direct and incremental costs incurred in connection with the anticipated Separation, including audit, advisory, and legal costs. Excludes the noncontrolling interest portion of the restructuring gains within Steel Processing of $ 1,850 . Excludes the noncontrolling interest portion of the restructuring gains within Steel Processing of $ 81 . Excludes a non-cash settlement charge of $ 4,774 in miscellaneous income (expense), net within Other to accelerate a portion of deferred pension cost as a result of a pension lift-out transaction executed with a third-party insurance company to transfer a portion of the total projected benefit obligation of The Gerstenslager Company Bargaining Unit Employees’ Pension Plan to the third-party insurance company; excludes a loss of $ 15,759 in equity in net income (loss) of unconsolidated affiliates within Other related to the sale of the Company’s 50 % noncontrolling equity investment in ArtiFlex effective August 3, 2022; excludes $ 1,050 in selling, general and administrative expense in Consumer Products related to incremental compensation expense attributable to the Level5 earnout; and excludes $ 9,246 of Separation costs in Other related to direct and incremental costs incurred in connection with the anticipated Separation, including audit, advisory, and legal costs. Excludes the noncontrolling interest portion of the impairment charge and restructuring gains within Steel Processing of $ 1,734 . Excludes the noncontrolling interest portion of the restructuring gains within Steel Processing of $ 6,027 . |
Segment Operations - Financia_2
Segment Operations - Financial Information for Reportable Segments (Parenthetical) (Detail) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Aug. 03, 2022 | Nov. 30, 2022 | Nov. 30, 2021 | Nov. 30, 2022 | Nov. 30, 2021 | |
Segment Reporting Information [Line Items] | |||||
Non-cash settlement charge | $ 4,774,000 | ||||
Loss on sale of equity investments | (15,759,000) | ||||
Incremental expenses of Earnout | $ 525,000 | 1,050,000 | |||
Impairment and restructuring charges (gains) | 1,850,000 | $ 81,000 | 1,734,000 | $ 6,027,000 | |
Consolidated | |||||
Segment Reporting Information [Line Items] | |||||
Separation costs | $ 9,246,000 | $ 9,246,000 | |||
ArtiFlex | |||||
Segment Reporting Information [Line Items] | |||||
Loss on sale of equity investments | $ (15,759,000) | ||||
Percent of ownership interest held in unconsolidated affiliates | 50% | 50% |
Acquisitions - Additional Infor
Acquisitions - Additional Information (Details) - Level5 Tools, LLC - USD ($) | 3 Months Ended | 6 Months Ended | |
Jun. 02, 2022 | Nov. 30, 2022 | Nov. 30, 2022 | |
Business Acquisition [Line Items] | |||
Purchase price | $ 59,472,000 | ||
Earnout payment | 2,000,000 | ||
Additional cash consideration provides on certain earnings targets | 25,000,000 | ||
Earnout Agreement | |||
Business Acquisition [Line Items] | |||
Earnout payment | 2,000,000 | ||
Earnout Agreement | Selling, General and Administrative Expense | |||
Business Acquisition [Line Items] | |||
Compensation expense | $ 525,000 | $ 1,050,000 | |
Preliminary Valuation | |||
Business Acquisition [Line Items] | |||
Purchase price | 59,321,000 | ||
Earnout payment | $ 2,000,000 |
Acquisitions - Schedule of Acqu
Acquisitions - Schedule of Acquisition of Identifiable Intangible Assets (Detail) - Level5 Tools, LLC $ in Thousands | Jun. 02, 2022 USD ($) |
Business Acquisition [Line Items] | |
Total acquired identifiable intangible assets | $ 33,580 |
Trade Name | |
Business Acquisition [Line Items] | |
Acquired indefinite lived intangible assets | 13,500 |
Customer Relationships | |
Business Acquisition [Line Items] | |
Acquired finite lived intangible assets | $ 13,300 |
Useful Life (Years) | 10 years |
Technological Know How | |
Business Acquisition [Line Items] | |
Acquired finite lived intangible assets | $ 6,500 |
Useful Life (Years) | 20 years |
Non Compete Agreement | |
Business Acquisition [Line Items] | |
Acquired finite lived intangible assets | $ 280 |
Useful Life (Years) | 3 years |
Acquisitions - Schedule of Cons
Acquisitions - Schedule of Consideration Transferred and the Preliminary Fair Value Assigned to Assets Acquired and Liabilities Assumed (Detail) - USD ($) | Jun. 02, 2022 | Nov. 30, 2022 | May 31, 2022 |
Business Acquisition [Line Items] | |||
Goodwill | $ 412,971,000 | $ 401,469,000 | |
Level5 Tools, LLC | |||
Business Acquisition [Line Items] | |||
Cash and cash equivalents | $ 1,515,000 | ||
Accounts receivable | 2,860,000 | ||
Inventories | 9,161,000 | ||
Prepaid expenses | 64,000 | ||
Property, plant and equipment | 273,000 | ||
Intangible assets | 33,580,000 | ||
Operating lease assets | 377,000 | ||
Total identifiable assets | 47,830,000 | ||
Accounts payable | (3,175,000) | ||
Accrued expenses | (753,000) | ||
Current operating lease liabilities | (111,000) | ||
Noncurrent operating lease liabilities | (266,000) | ||
Net identifiable assets | 43,525,000 | ||
Goodwill | 15,947,000 | ||
Total purchase price | 59,472,000 | ||
Less: Fair value of earnout | (2,000,000) | ||
Plus: Net working capital deficit | 131,000 | ||
Cash purchase price | 57,603,000 | ||
Level5 Tools, LLC | Preliminary Valuation | |||
Business Acquisition [Line Items] | |||
Cash and cash equivalents | 1,515,000 | ||
Accounts receivable | 2,860,000 | ||
Inventories | 9,161,000 | ||
Prepaid expenses | 64,000 | ||
Property, plant and equipment | 273,000 | ||
Intangible assets | 33,580,000 | ||
Operating lease assets | 377,000 | ||
Total identifiable assets | 47,830,000 | ||
Accounts payable | (3,175,000) | ||
Accrued expenses | (904,000) | ||
Current operating lease liabilities | (111,000) | ||
Noncurrent operating lease liabilities | (266,000) | ||
Net identifiable assets | 43,374,000 | ||
Goodwill | 15,947,000 | ||
Total purchase price | 59,321,000 | ||
Less: Fair value of earnout | (2,000,000) | ||
Plus: Net working capital deficit | 282,000 | ||
Cash purchase price | 57,603,000 | ||
Level5 Tools, LLC | Measurement Period Adjustments | |||
Business Acquisition [Line Items] | |||
Accrued expenses | 151,000 | ||
Net identifiable assets | 151,000 | ||
Total purchase price | 151,000 | ||
Plus: Net working capital deficit | $ (151,000) |
Derivative Financial Instrume_3
Derivative Financial Instruments and Hedging Activities - Schedule of Fair Value of Derivative Instruments (Detail) - USD ($) $ in Thousands | Nov. 30, 2022 | May 31, 2022 |
Derivative [Line Items] | ||
Asset Derivatives at Fair Value | $ 5,038 | $ 12,643 |
Liability Derivatives at Fair Value | 20,295 | 9,003 |
Derivatives Designated As Hedging Instruments | ||
Derivative [Line Items] | ||
Asset Derivatives at Fair Value | 398 | 1,040 |
Liability Derivatives at Fair Value | 17,771 | 4,582 |
Derivatives Designated As Hedging Instruments | Commodity Contracts | ||
Derivative [Line Items] | ||
Asset Derivatives at Fair Value | 4,640 | 1,040 |
Liability Derivatives at Fair Value | 2,430 | 4,565 |
Derivatives Designated As Hedging Instruments | Commodity Contracts | Accounts Payable | ||
Derivative [Line Items] | ||
Liability Derivatives at Fair Value | 16,830 | 4,517 |
Derivatives Designated As Hedging Instruments | Commodity Contracts | Receivables | ||
Derivative [Line Items] | ||
Asset Derivatives at Fair Value | 140 | 1,040 |
Derivatives Designated As Hedging Instruments | Commodity Contracts | Other Liabilities | ||
Derivative [Line Items] | ||
Liability Derivatives at Fair Value | 941 | 48 |
Derivatives Designated As Hedging Instruments | Foreign Currency Exchange Contracts | ||
Derivative [Line Items] | ||
Liability Derivatives at Fair Value | 17 | |
Derivatives Designated As Hedging Instruments | Foreign Currency Exchange Contracts | Other Assets | ||
Derivative [Line Items] | ||
Asset Derivatives at Fair Value | 258 | |
Derivatives Designated As Hedging Instruments | Foreign Currency Exchange Contracts | Other Liabilities | ||
Derivative [Line Items] | ||
Liability Derivatives at Fair Value | 17 | |
Derivatives Not Designated As Hedging Instruments | ||
Derivative [Line Items] | ||
Asset Derivatives at Fair Value | 4,640 | 11,603 |
Liability Derivatives at Fair Value | 2,524 | 4,421 |
Derivatives Not Designated As Hedging Instruments | Commodity Contracts | ||
Derivative [Line Items] | ||
Asset Derivatives at Fair Value | 140 | 11,603 |
Liability Derivatives at Fair Value | 17,771 | 4,166 |
Derivatives Not Designated As Hedging Instruments | Commodity Contracts | Accounts Payable | ||
Derivative [Line Items] | ||
Liability Derivatives at Fair Value | 2,155 | 4,142 |
Derivatives Not Designated As Hedging Instruments | Commodity Contracts | Receivables | ||
Derivative [Line Items] | ||
Asset Derivatives at Fair Value | 4,622 | 11,555 |
Derivatives Not Designated As Hedging Instruments | Commodity Contracts | Other Assets | ||
Derivative [Line Items] | ||
Asset Derivatives at Fair Value | 18 | 48 |
Derivatives Not Designated As Hedging Instruments | Commodity Contracts | Other Liabilities | ||
Derivative [Line Items] | ||
Liability Derivatives at Fair Value | 275 | 24 |
Derivatives Not Designated As Hedging Instruments | Foreign Currency Exchange Contracts | Accounts Payable | ||
Derivative [Line Items] | ||
Liability Derivatives at Fair Value | $ 94 | $ 255 |
Derivative Financial Instrume_4
Derivative Financial Instruments and Hedging Activities - Additional Information (Detail) - USD ($) | 6 Months Ended | 12 Months Ended |
Nov. 30, 2022 | May 31, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Impact to fair value of derivative assets and liabilities as a result of recognition on a gross basis | $ 6,739,000 | $ 6,300,000 |
Gains in accumulated other comprehensive income expected to be reclassified into net earnings | 18,807,000 | |
Gains in accumulated other comprehensive income expected to be reclassified into net earnings, tax | $ 5,918,000 |
Derivative Financial Instrume_5
Derivative Financial Instruments and Hedging Activities - Schedule of Summary of Derivative Hedges (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Nov. 30, 2022 | Nov. 30, 2021 | Nov. 30, 2022 | Nov. 30, 2021 | |
Derivative [Line Items] | ||||
Notional Amount | $ 3,814 | $ (10,723) | $ 2,143 | $ (19,641) |
Commodity Contracts | Minimum [Member] | Derivatives Not Designated As Hedging Instruments | ||||
Derivative [Line Items] | ||||
Maturity Date | Dec. 31, 2022 | |||
Notional Amount | $ 5,100 | |||
Commodity Contracts | Maximum | Derivatives Not Designated As Hedging Instruments | ||||
Derivative [Line Items] | ||||
Maturity Date | Dec. 31, 2023 | |||
Foreign Currency Exchange Contracts | Derivatives Not Designated As Hedging Instruments | ||||
Derivative [Line Items] | ||||
Maturity Date | Dec. 31, 2022 | |||
Notional Amount | $ 15,096 | |||
Cash Flow Hedges | Commodity Contracts | ||||
Derivative [Line Items] | ||||
Notional Amount | 114,516 | $ 114,516 | ||
Cash Flow Hedges | Commodity Contracts | Minimum [Member] | ||||
Derivative [Line Items] | ||||
Maturity Date | Dec. 31, 2022 | |||
Cash Flow Hedges | Commodity Contracts | Maximum | ||||
Derivative [Line Items] | ||||
Maturity Date | Dec. 31, 2023 | |||
Cash Flow Hedges | Foreign Currency Exchange Contracts | ||||
Derivative [Line Items] | ||||
Notional Amount | $ 1,751 | $ 1,751 | ||
Cash Flow Hedges | Foreign Currency Exchange Contracts | Minimum [Member] | ||||
Derivative [Line Items] | ||||
Maturity Date | Jan. 31, 2023 | |||
Cash Flow Hedges | Foreign Currency Exchange Contracts | Maximum | ||||
Derivative [Line Items] | ||||
Maturity Date | Jul. 31, 2023 |
Derivative Financial Instrume_6
Derivative Financial Instruments and Hedging Activities - Schedule of Derivative Financials Designated as Cash Flow Hedging Instruments (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Nov. 30, 2022 | Nov. 30, 2021 | Nov. 30, 2022 | Nov. 30, 2021 | |
Derivative [Line Items] | ||||
Gain (Loss) Recognized in OCI | $ (19,265) | $ (20,942) | $ (36,041) | $ 14,279 |
Gain (Loss) Reclassified from AOCI into Net Earnings | (13,602) | 47,736 | (13,279) | 83,155 |
Commodity Contracts | ||||
Derivative [Line Items] | ||||
Gain (Loss) Recognized in OCI | (19,641) | (21,002) | (36,099) | 14,218 |
Gain (Loss) Reclassified from AOCI into Net Earnings | (13,648) | 47,706 | (13,192) | 83,165 |
Interest Rate Contract | ||||
Derivative [Line Items] | ||||
Gain (Loss) Reclassified from AOCI into Net Earnings | (7) | 27 | (13) | (13) |
Foreign Currency Exchange Contracts | ||||
Derivative [Line Items] | ||||
Gain (Loss) Recognized in OCI | 376 | 60 | 58 | 61 |
Gain (Loss) Reclassified from AOCI into Net Earnings | $ 53 | $ (3) | $ (74) | $ 3 |
Derivative Financial Instrume_7
Derivative Financial Instruments and Hedging Activities - Schedule of Gain (Loss) Recognized in Earnings for Economic (Non-Designated) Derivative Financial Instruments (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Nov. 30, 2022 | Nov. 30, 2021 | Nov. 30, 2022 | Nov. 30, 2021 | |
Derivative [Line Items] | ||||
Gain (Loss) Recognized in Earnings | $ 3,814 | $ (10,723) | $ 2,143 | $ (19,641) |
Commodity Contracts | Cost of Sales | ||||
Derivative [Line Items] | ||||
Gain (Loss) Recognized in Earnings | 3,861 | (10,135) | 2,284 | (19,392) |
Foreign Currency Exchange Contracts | Miscellaneous Income, Net | ||||
Derivative [Line Items] | ||||
Gain (Loss) Recognized in Earnings | $ (47) | $ (588) | $ (141) | $ (249) |
Fair Value - Schedule of Assets
Fair Value - Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Nov. 30, 2022 | May 31, 2022 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets | $ 5,038 | $ 12,643 | |
Liabilities | 20,295 | 9,003 | |
Derivative Financial Instruments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets | [1] | 5,038 | 9,003 |
Liabilities | [1] | 20,295 | 12,643 |
Fair Value, Inputs, Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets | 5,038 | 12,643 | |
Liabilities | 20,295 | 9,003 | |
Fair Value, Inputs, Level 2 | Derivative Financial Instruments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets | [1] | 5,038 | 9,003 |
Liabilities | [1] | $ 20,295 | $ 12,643 |
[1] The fair value of our derivative financial instruments is based on the present value of the expected future cash flows considering the risks involved, including non-performance risk, and using discount rates appropriate for the respective maturities. Market observable, Level 2 inputs are used to determine the present value of the expected future cash flows. Refer to “ Note Q – Derivative Financial Instruments and Hedging Activities ” for additional information regarding our use of derivative financial instruments. |
Fair Value - Assets Measured at
Fair Value - Assets Measured at Fair Value on Non-Recurring Basis (Detail) - Fair Value, Nonrecurring - USD ($) | Nov. 30, 2022 | May 31, 2022 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets, Fair Value Disclosure | $ 0 | $ 700,000 | |
Fair Value, Inputs, Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets, Fair Value Disclosure | 700,000 | ||
Long Lived Assets Held for Sale | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets, Fair Value Disclosure | [1] | 700,000 | |
Long Lived Assets Held for Sale | Fair Value, Inputs, Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets, Fair Value Disclosure | [1] | $ 700,000 | |
[1] Comprised of production equipment at our Twinsburg, Ohio facility with an estimated fair market value of $ 700,000 . |
Fair Value - Assets Measured _2
Fair Value - Assets Measured at Fair Value on Non-Recurring Basis (Parenthetical) (Detail) | May 31, 2022 USD ($) |
Long Lived Assets Held And Used | Production Equipment | Twinsburg | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Fair market value of assets | $ 700,000 |
Fair Value - Additional Informa
Fair Value - Additional Information (Detail) - Long-term Debt - USD ($) | Nov. 30, 2022 | May 31, 2022 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt at fair value including current maturities | $ 646,856,000 | $ 684,830,000 |
Long-term debt at carrying amount including current maturities | $ 693,710,000 | $ 696,610,000 |