Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Nov. 30, 2023 | Jan. 04, 2024 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Nov. 30, 2023 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q2 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Trading Symbol | WOR | |
Entity Registrant Name | WORTHINGTON ENTERPRISES, 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 West 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 | 49,994,385 | |
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, 2023 | May 31, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 430,906 | $ 454,946 |
Receivables, less allowances of $2,944 and $3,383 at November 30, 2023 and May 31, 2023, respectively | 640,826 | 692,887 |
Inventories: | ||
Raw materials | 245,166 | 264,568 |
Work in process | 156,361 | 183,248 |
Finished products | 174,884 | 160,152 |
Total inventories | 576,411 | 607,968 |
Income taxes receivable | 5,511 | 4,198 |
Assets held for sale | 1,789 | 3,381 |
Prepaid expenses and other current assets | 117,160 | 104,957 |
Total current assets | 1,772,603 | 1,868,337 |
Investments in unconsolidated affiliates | 247,421 | 252,591 |
Operating lease assets | 94,677 | 99,967 |
Goodwill | 416,857 | 414,820 |
Other intangible assets, net of accumulated amortization of $121,478 and $112,202 at November 30, 2023 and May 31, 2023, respectively | 305,649 | 314,226 |
Other assets | 42,916 | 25,323 |
Property, plant and equipment: | ||
Land | 50,920 | 49,697 |
Buildings and improvements | 312,830 | 308,669 |
Machinery and equipment | 1,293,628 | 1,263,962 |
Construction in progress | 78,536 | 45,165 |
Total property, plant and equipment | 1,735,914 | 1,667,493 |
Less: accumulated depreciation | 1,031,900 | 991,839 |
Total property, plant and equipment, net | 704,014 | 675,654 |
Total assets | 3,584,137 | 3,650,918 |
Current liabilities: | ||
Accounts payable | 447,119 | 528,920 |
Short-term borrowings | 175,000 | 2,813 |
Accrued compensation, contributions to employee benefit plans and related taxes | 80,461 | 93,810 |
Dividends payable | 17,245 | 18,330 |
Other accrued items | 62,270 | 53,362 |
Current operating lease liabilities | 12,493 | 12,608 |
Income taxes payable | 485 | 7,451 |
Current maturities of long-term debt | 150,269 | 264 |
Total current liabilities | 945,342 | 717,558 |
Other liabilities | 112,878 | 113,286 |
Distributions in excess of investment in unconsolidated affiliate | 118,465 | 117,297 |
Long-term debt | 298,549 | 689,718 |
Noncurrent operating lease liabilities | 85,283 | 89,982 |
Deferred income taxes, net | 99,653 | 101,449 |
Total liabilities | 1,660,170 | 1,829,290 |
Shareholders' equity - controlling interest | 1,792,809 | 1,696,011 |
Noncontrolling interests | 131,158 | 125,617 |
Total equity | 1,923,967 | 1,821,628 |
Total liabilities and equity | $ 3,584,137 | $ 3,650,918 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Nov. 30, 2023 | May 31, 2023 |
Statement of Financial Position [Abstract] | ||
Receivables, allowances | $ 2,944 | $ 3,383 |
Other intangible assets, accumulated amortization | $ 121,478 | $ 112,202 |
Consolidated Statements of Earn
Consolidated Statements of Earnings - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Nov. 30, 2023 | Nov. 30, 2022 | Nov. 30, 2023 | Nov. 30, 2022 | |
Income Statement [Abstract] | ||||
Net sales | $ 1,086,918 | $ 1,175,541 | $ 2,280,174 | $ 2,584,206 |
Cost of goods sold | 963,204 | 1,069,778 | 1,958,971 | 2,309,069 |
Gross margin | 123,714 | 105,763 | 321,203 | 275,137 |
Selling, general and administrative expense | 107,688 | 107,813 | 220,036 | 211,261 |
Impairment of long-lived assets | 1,401 | 312 | ||
Restructuring and other expense (income), net | 6 | (4,282) | 6 | (5,382) |
Separation costs | 21,952 | 9,246 | 27,987 | 9,246 |
Operating income (loss) | (5,932) | (7,014) | 71,773 | 59,700 |
Other income (expense): | ||||
Miscellaneous income (expense), net | 1,020 | 1,405 | 2,031 | (3,681) |
Loss on extinguishment of debt | (1,534) | |||
Interest expense, net | (2,169) | (7,612) | (5,252) | (16,210) |
Equity in net income of unconsolidated affiliates | 42,446 | 36,857 | 96,827 | 68,569 |
Earnings before income taxes | 35,365 | 23,636 | 163,845 | 108,378 |
Income tax expense | 7,198 | 4,131 | 35,975 | 23,629 |
Net earnings | 28,167 | 19,505 | 127,870 | 84,749 |
Net earnings attributable to noncontrolling interests | 3,865 | 3,287 | 7,461 | 4,449 |
Net earnings attributable to controlling interest | $ 24,302 | $ 16,218 | $ 120,409 | $ 80,300 |
Basic | ||||
Weighted average common shares outstanding | 49,186 | 48,558 | 49,013 | 48,518 |
Earnings per common share attributable to controlling interest | $ 0.49 | $ 0.33 | $ 2.46 | $ 1.66 |
Diluted | ||||
Weighted average common shares outstanding | 50,042 | 49,330 | 50,102 | 49,293 |
Earnings per common share attributable to controlling interest | $ 0.49 | $ 0.33 | $ 2.4 | $ 1.63 |
Common shares outstanding at end of period | 49,287 | 48,572 | 49,287 | 48,572 |
Cash dividends declared per common share | $ 0.32 | $ 0.31 | $ 0.64 | $ 0.62 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Nov. 30, 2023 | Nov. 30, 2022 | Nov. 30, 2023 | Nov. 30, 2022 | |
Statement of Comprehensive Income [Abstract] | ||||
Net earnings | $ 28,167 | $ 19,505 | $ 127,870 | $ 84,749 |
Other comprehensive income (loss), net of tax | ||||
Foreign currency translation | 897 | 858 | 2,342 | (9,243) |
Pension liability adjustment | (82) | (3) | 2,857 | |
Cash flow hedges | 13,549 | (4,000) | 6,699 | (17,300) |
Other comprehensive income (loss) | 14,446 | (3,224) | 9,038 | (23,686) |
Comprehensive income | 42,613 | 16,281 | 136,908 | 61,063 |
Comprehensive income attributable to noncontrolling interests | 3,865 | 3,287 | 7,461 | 4,449 |
Comprehensive income attributable to controlling interest | $ 38,748 | $ 12,994 | $ 129,447 | $ 56,614 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Nov. 30, 2023 | Nov. 30, 2022 | Nov. 30, 2023 | Nov. 30, 2022 | |
Operating activities: | ||||
Net earnings | $ 28,167 | $ 19,505 | $ 127,870 | $ 84,749 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||||
Depreciation and amortization | 28,007 | 28,354 | 56,332 | 56,355 |
Impairment of long-lived assets | 1,401 | 312 | ||
Provision for (benefit from) deferred income taxes | 1,968 | (3,617) | (3,485) | (14,673) |
Loss on extinguishment of debt | 1,534 | |||
Bad debt expense (income) | 345 | 1,098 | (454) | 1,440 |
Equity in net income of unconsolidated affiliates, net of distributions | (4,129) | 18,352 | 6,096 | 61,197 |
Net gain on sale of assets | (439) | (4,265) | (334) | (5,034) |
Stock-based compensation | 6,175 | 4,547 | 10,691 | 8,783 |
Changes in assets and liabilities, net of impact of acquisitions: | ||||
Receivables | 76,704 | 119,674 | 67,861 | 157,093 |
Inventories | 103,150 | 72,293 | 38,823 | 113,460 |
Accounts payable | (75,373) | (100,535) | (75,095) | (202,116) |
Accrued compensation and employee benefits | 2,794 | 3,336 | (9,220) | (30,532) |
Income taxes payable | (35,428) | (7,629) | (6,966) | (300) |
Other operating items, net | 3,049 | (18,172) | (20,368) | (16,755) |
Net cash provided by operating activities | 134,990 | 132,941 | 194,686 | 213,979 |
Investing activities: | ||||
Investment in property, plant and equipment | (32,876) | (24,490) | (62,174) | (45,967) |
Proceeds from sale of assets, net of selling costs | 751 | 23,739 | 802 | 35,494 |
Acquisitions, net of cash acquired | (21,013) | (21,013) | (56,088) | |
Investment in note receivable | (15,000) | |||
Investment in non-marketable equity securities | (1,500) | (140) | (1,540) | (250) |
Proceeds from the sale of investment in ArtiFlex, net of selling costs | 36,095 | |||
Distribution from unconsolidated affiliate | 1,085 | 1,085 | ||
Net cash used by investing activities | (53,553) | (891) | (97,840) | (30,716) |
Financing activities: | ||||
Net proceeds from (repayments of) short-term borrowings | 175,000 | (10,619) | 172,187 | (43,062) |
Principal payments on long-term obligations | (13) | (243,757) | (150) | |
Proceeds from issuance of common shares, net of tax withholdings | (9,207) | (649) | (14,337) | (4,115) |
Payments to noncontrolling interests | (11,760) | (1,921) | (11,760) | |
Dividends paid | (17,333) | (15,181) | (33,058) | (29,065) |
Net cash provided (used) by financing activities | 148,460 | (38,222) | (120,886) | (88,152) |
Increase (decrease) in cash and cash equivalents | 229,897 | 93,828 | (24,040) | 95,111 |
Cash and cash equivalents at beginning of period | 201,009 | 35,768 | 454,946 | 34,485 |
Cash and cash equivalents at end of period | $ 430,906 | $ 129,596 | $ 430,906 | $ 129,596 |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Nov. 30, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Note A – Basis of Presentation Basis of Presentation These unaudited consolidated financial statements include the accounts of Worthington Enterprises and its consolidated subsidiaries. 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”) ( 63 %). We also own a 51 % controlling interest in Worthington Specialty Processing (“WSP”), which became a non-operating joint venture on October 31, 2022, when the remaining net assets of WSP were sold. 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 their portions of net earnings and other comprehensive income (loss) (“OCI”) are 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 affiliates that we do not control are accounted for under the equity method with our proportionate share of income or loss recognized within equity in net income of unconsolidated affiliates (“equity income”) in our consolidated statements of earnings. 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. (“U.S. GAAP”) 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 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 second quarter of fiscal 2024 are not necessarily indicative of the results that may be expected for the fiscal year ending May 31, 2024 (“fiscal 2024”) or for any other fiscal quarter. For further information, refer to the consolidated financial statements and notes thereto included in the 2023 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 materially from those estimates. The Separation of the Steel Processing Business On December 1, 2023, we completed the Separation and Worthington Steel, comprised of our former Steel Processing business, became an independent, publicly traded company. To effectuate the Separation, we made a pro-rata distribution of all outstanding shares of Worthington Steel, which was tax-free to our shareholders for U.S. federal income tax purposes. Each holder of record of Worthington Enterprises common shares received one common share of Worthington Steel for every one common share of Worthington Enterprises held (the “Distribution”) as of the close of business on November 21, 2023 (the “Record Date”). On November 30, 2023, in connection with the Separation, we entered into several agreements with Worthington Steel that govern the relationship between Worthington Steel and us following the Distribution, including a Separation and Distribution Agreement, Tax Matters Agreement, Employee Matters Agreement, and Transition Services Agreement. Direct and incremental costs associated with the Separation are presented as a separate component of operating expense within the Separation c osts caption in our consolidated statements of earnings and are held at the corporate level. Separation costs through the first six months of fiscal 2024 consisted primarily of third-party advisory fees and certain non-recurring employee-related costs totaling $ 15,760 and $ 7,093 , respectively, with the residual related to incremental costs associated with the separation of shared corporate functions. Employee-related costs in fiscal 2024 include $ 5,437 of i ncremental compensation expense associated with the modification of unvested long-term incentive compensation awards as required under the Employee Matters Agreement as well as accrued retention bonuses and severance expense. Substantially all of the costs incurred through the first six months of fiscal 2023 related to third-party advisory fees. |
Inventory
Inventory | 6 Months Ended |
Nov. 30, 2023 | |
Inventory Disclosure [Abstract] | |
Inventory | Note B – Inventory During the second quarter of fiscal 2024, we initiated a recall with the Consumer Protection Safety Commission for our recently introduced Balloon Time® Mini helium tank. We have reserved for the estimated direct and incremental costs expected to be incurred to administer the recall program, which we expect to be immaterial due to the small population of tanks purchased by end consumers. However, we booked a reserve of approximately $ 3,000 to reflect the impacted inventory at its estimated net realizable value. The adjustment was attributed to our Consumer Products operating segment and was recorded in cost of goods sold in the consolidated statement of earnings for the three and six months ended November 30, 2023. |
Revenue Recognition
Revenue Recognition | 6 Months Ended |
Nov. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Note C – Revenue Recognition The following table summarizes net sales by operating segment and product class within the Steel Processing operating segment for the periods presented: Three Months Ended Six Months Ended November 30, November 30, (In thousands) 2023 2022 2023 2022 Steel Processing Direct $ 750,622 $ 807,259 $ 1,595,985 $ 1,809,394 Toll 38,033 34,688 74,008 71,433 Total 788,655 841,947 1,669,993 1,880,827 Consumer Products 147,738 153,795 297,151 342,497 Building Products 122,954 141,671 256,822 291,994 Sustainable Energy Solutions 27,537 38,128 56,174 68,888 Other 34 - 34 - Total $ 1,086,918 $ 1,175,541 $ 2,280,174 $ 2,584,206 With the exception of toll processing, net sales are recognized at the point in time the performance obligation is satisfied and control is transferred to the customer, typically upon shipment or delivery. The following table summarizes the unbilled receivables at the dates indicated: November 30, May 31, (In thousands) Balance Sheet Classification 2023 2023 Unbilled receivables Receivables $ 4,148 $ 3,708 There were no contract assets at November 30, 2023 or at May 31, 2023 . |
Investments in Unconsolidated A
Investments in Unconsolidated Affiliates | 6 Months Ended |
Nov. 30, 2023 | |
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 and included the following at November 30, 2023 : 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 %). We also held a 50 % noncontrolling equity interest in ArtiFlex Manufacturing, LLC (“ArtiFlex”), through August 3, 2022, when it was purchased by the unrelated joint venture partner. In connection with this transaction, we received net cash proceeds of approximately $ 36,095 and realized a pre-tax loss of $ 15,759 within equity income, representing the amount by which the book value of our investment exceeded the net cash proceeds. During the second quarter of fiscal 2024, we recognized a pre-tax gain of $ 2,780 within equity income, representing our portion of the overall gain realized in connection with the sale of Workhorse’s operations in Brazil. We received distributions from unconsolidated affiliates totaling $ 104,008 during the six months ended November 30, 2023. We have received cumulative distributions from WAVE in excess of our investment balance amounting to $ 118,465 and $ 117,297 , respectively, at November 30, 2023 and May 31, 2023, which are presented separately within long-term liabilities in 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 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. During the second quarter of fiscal 2024, we classified $ 1,085 of dividends received from WAVE as an investing activity. 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) 2023 2023 Cash and cash equivalents $ 37,728 $ 49,185 Other current assets 871,945 899,913 Noncurrent assets 372,258 394,468 Total assets $ 1,281,931 $ 1,343,566 Current liabilities 282,320 247,796 Current maturities of long-term debt - 36,936 Long-term debt 349,323 349,215 Other noncurrent liabilities 138,566 144,649 Equity 511,722 564,970 Total liabilities and equity $ 1,281,931 $ 1,343,566 Three Months Ended Six Months Ended November 30, November 30, (In thousands) 2023 2022 2023 2022 Net sales $ 676,875 $ 711,665 $ 1,397,308 $ 1,535,607 Gross margin 166,939 147,299 361,247 328,704 Operating income 134,120 107,356 283,529 245,183 Depreciation and amortization 8,303 6,864 16,946 15,052 Interest expense 4,538 3,910 10,277 6,590 Income tax expense 6,708 1,262 8,354 3,372 Net earnings 122,670 105,183 266,236 238,421 |
Impairment of Long-Lived Assets
Impairment of Long-Lived Assets | 6 Months Ended |
Nov. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Impairment of Long-Lived Assets | Note E – Impairment of Long-Lived Assets During the first quarter of fiscal 2023, we committed to plans to liquidate certain fixed assets at the Samuel joint venture’s toll processing facility in Cleveland, Ohio. 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 resulting in a pre-tax impairment charge of $ 312 . During the first quarter of fiscal 2024, we lowered our estimate of fair value less costs to sell to reflect the expected scrap value of the equipment, to $ 150 , resulting in a pre-tax impairment charge of $ 1,401 . |
Restructuring and Other Expense
Restructuring and Other Expenses (Income), Net | 6 Months Ended |
Nov. 30, 2023 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Other Expenses (Income), Net | Note F – Restructuring and Other Expenses (Income), Net We consider restructuring activities to be programs whereby we fundamentally change our operations, such as divestitures, closing or consolidating facilities, employee severance (including rationalizing headcount or other significant changes in personnel), and realignment of existing operations (including changes to management structure in response to underlying performance and/or changing market conditions). We made severance payments of $ 141 , primarily associated with a prior restructuring initiative in the Building Products operating segment during the six months ended November 30, 2023. As a result, there were no liabilities associated with our restructuring activities at November 30, 2023. Restructuring and other income, net for the six months ended November 30, 2022 of $ 5,382 resulted primarily from the sale of the remaining real property of our former oil and gas equipment business on June 14, 2022, for net cash proceeds of $ 5,775 , and the sale of WSP on October 31, 2022. The sale resulted in net cash proceeds of $ 21,277, which resulted in a pre-tax gain of $ 3,926 . |
Contingent Liabilities and Comm
Contingent Liabilities and Commitments | 6 Months Ended |
Nov. 30, 2023 | |
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, 2023 | |
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, at November 30, 2023 , we were party to an operating lease for an aircraft in which we have guaranteed a residual value at the termination of the lease on March 30, 2028. The maximum obligation under the terms of this guarantee was approximately $ 16,143 at November 30, 2023. Based on current facts and circumstances, we have estimated the likelihood of payment pursuant to this guarantee is not probable and, therefore, no amount has been recognized in our consolidated financial statements. At November 30, 2023 , we also had in place $ 12,137 of outstand ing stand-by letters of credit issued to third-party service providers. The fair value of these guarantees, based on premiums paid, was not material and no amounts were drawn against them at November 30, 2023 . |
Debt and Receivables Securitiza
Debt and Receivables Securitization | 6 Months Ended |
Nov. 30, 2023 | |
Debt Disclosure [Abstract] | |
Debt and Receivables Securitization | Note I – Debt and Receivables Securitization The following table summarizes our long-term debt and short-term borrowings outstanding at November 30, 2023 and May 31, 2023: November 30, May 31, (In thousands) 2023 2023 Short-term borrowings $ 175,000 $ 2,813 4.60 % senior notes due August 10, 2024 150,000 150,000 4.55 % senior notes due April 15, 2026 - 243,623 4.30 % senior notes due August 1, 2032 200,000 200,000 1.56 % Series A senior note due August 23, 2031 39,962 39,226 1.90 % Series B senior notes due August 23, 2034 59,887 58,786 Other 402 528 Total debt 625,251 694,976 Unamortized discount and debt issuance costs ( 1,433 ) ( 2,181 ) Total debt, net 623,818 692,795 Less: current maturities and short-term borrowings 325,269 3,077 Total long-term debt $ 298,549 $ 689,718 Maturities of long-term debt and short-term borrowings in fiscal 2024 year and the four fiscal years thereafter, are as follows: (In thousands) 2024 (1) $ 175,133 2025 150,269 2026 - 2027 - 2028 - Thereafter 299,849 Total $ 625,251 (1) Includes $ 175,000 associated with the Worthington Steel Credit Facility (as defined below). Subsequent to the Separation on December 1, 2023, we have no remaining obligation. See the “Other Financing Arrangements” section below for additional information. Long-Term Debt On April 15, 2014, we issued senior unsecured notes in the principal amount of $ 250,000 , which bear interest at a rate of 4.55 % and were scheduled to mature on April 15, 2026 (the “2026 Notes”). During fiscal 2023, we purchased approximately $ 6,377 of the principal amount of the 2026 Notes in open market transactions, leaving $ 243,623 within long-term debt at May 31, 2023. On June 29, 2023, we notified the trustee under the indenture to which the 2026 Notes are subject that we had elected to redeem in full the 2026 Notes. On July 28, 2023, we redeemed, in full, the 2026 Notes at a price that approximated the par value of the debt of $ 243,623 . In connection with the debt redemption, we recognized a non-cash loss of $ 1,534 related primarily to unamortized debt issuance costs and amounts deferred in accumulated other comprehensive income (“AOCI”) associated with an interest rate swap executed prior to the issuance of the 2026 Notes. Other Financing Arrangements On November 30, 2023 , Worthington Steel entered into a five-year senior secured revolving credit facility (the “Worthington Steel Credit Facility”) with a group of lenders. The Worthington Steel Credit Facility will allow for borrowings of up to $ 550,000 , to the extent secured by eligible accounts receivable and inventory balances at period end, which consist primarily of U.S. Dollar denominated account balances. Amounts drawn under the Worthington Steel Credit Facility have maturities of up to one year and accrue interest at rates equal to an applicable margin over the SOFR Rate. In order to facilitate the post-separation capital structure of each company, $ 175,000 was drawn on the Worthington Steel Credit Facility immediately prior to the Separation. See “Note S – Subsequent Events” for further information. We maintain a $ 500,000 unsecured revolving credit facility (the “Credit Facility”) with a group of lenders. On September 27, 2023, we amended and restated the Credit Facility, extending the final maturity from August 20, 2026 to September 27, 2028 while keeping in place the $ 500,000 aggregate commitments under the Credit Facility in anticipation of the Separation. 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 Simple SOFR Rate, the Prime Rate of PNC Bank, National Association or the Overnight Bank Funding Rate. The applicable margin is determined by our Total Leverage Ratio. There were no borrowings outstanding under the Credit Facility at November 30, 2023, leaving $ 500,000 available for use. On May 19, 2022, we entered into a five-year revolving trade accounts receivable securitization facility (“AR Facility”) that allowed for short-term borrowings of up to $ 175,000 through the factoring and subsequent sale, on a revolving basis, of eligible accounts receivable of certain of our subsidiaries to Worthington Receivables Company, LLC, a wholly-owned, consolidated, bankruptcy-remote indirect subsidiary. On June 29, 2023, we elected to terminate the AR Facility. No early termination or other similar fees or penalties were paid in connection with the termination. |
Other Comprehensive Income (Los
Other Comprehensive Income (Loss) | 6 Months Ended |
Nov. 30, 2023 | |
Equity [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, 2023 November 30, 2022 (In thousands) Before-Tax Tax Net-of-Tax Before-Tax Tax Net-of-Tax Foreign currency translation $ 843 $ 54 $ 897 $ 550 $ 308 $ 858 Pension liability adjustment - - - 15 ( 97 ) ( 82 ) Cash flow hedges 17,390 ( 3,841 ) 13,549 ( 5,665 ) 1,665 ( 4,000 ) Other comprehensive income (loss) $ 18,233 $ ( 3,787 ) $ 14,446 $ ( 5,100 ) $ 1,876 $ ( 3,224 ) Six Months Ended November 30, 2023 November 30, 2022 (In thousands) Before-Tax Tax Net-of-Tax Before-Tax Tax Net-of-Tax Foreign currency translation $ 2,170 $ 172 $ 2,342 $ ( 8,970 ) $ ( 273 ) $ ( 9,243 ) Pension liability adjustment - ( 3 ) ( 3 ) 3,740 ( 883 ) 2,857 Cash flow hedges 8,578 ( 1,879 ) 6,699 ( 22,762 ) 5,462 ( 17,300 ) Other comprehensive income (loss) $ 10,748 $ ( 1,710 ) $ 9,038 $ ( 27,992 ) $ 4,306 $ ( 23,686 ) |
Changes in Equity
Changes in Equity | 6 Months Ended |
Nov. 30, 2023 | |
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 Income (Loss), Retained controlling (In thousands) Capital Net of Tax Earnings Subtotal Interests Total Balance at May 31, 2023 $ 290,799 $ ( 23,179 ) $ 1,428,391 $ 1,696,011 $ 125,617 $ 1,821,628 Net earnings - - 96,106 96,106 3,597 99,703 Other comprehensive loss - ( 5,408 ) - ( 5,408 ) - ( 5,408 ) Common shares issued, net of withholding tax ( 5,130 ) - - ( 5,130 ) - ( 5,130 ) Common shares in non-qualified plans 130 - - 130 - 130 Stock-based compensation 8,995 - - 8,995 - 8,995 Cash dividends declared - - ( 16,081 ) ( 16,081 ) - ( 16,081 ) Dividends to noncontrolling interests - - - - ( 1,921 ) ( 1,921 ) Balance at August 31, 2023 $ 294,794 $ ( 28,587 ) $ 1,508,416 $ 1,774,623 $ 127,293 $ 1,901,916 Net earnings - - 24,302 24,302 3,865 28,167 Other comprehensive income - 14,446 - 14,446 - 14,446 Common shares issued, net of withholding tax ( 9,207 ) - - ( 9,207 ) - ( 9,207 ) Common shares in non-qualified plans 195 - - 195 - 195 Stock-based compensation 4,511 - - 4,511 - 4,511 Cash dividends declared - - ( 16,061 ) ( 16,061 ) - ( 16,061 ) Balance at November 30, 2023 $ 290,293 $ ( 14,141 ) $ 1,516,657 $ 1,792,809 $ 131,158 $ 1,923,967 Controlling Interest Accumulated Other Additional Comprehensive Non- Paid-in Income (Loss), Retained controlling (In thousands) Capital Net of Tax Earnings Subtotal 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 interests - - - - ( 11,760 ) ( 11,760 ) Balance at November 30, 2022 $ 280,354 $ ( 46,536 ) $ 1,279,575 $ 1,513,393 $ 125,899 $ 1,639,292 The following table summarizes the changes in accumulated OCI for the periods presented: Accumulated Foreign Pension Other Currency Liability Cash Flow Comprehensive (In thousands) Translation Adjustment Hedges Loss Balance at May 31, 2023 $ ( 22,123 ) $ ( 1,730 ) $ 674 $ ( 23,179 ) Other comprehensive income before reclassifications 2,170 - 12,947 15,117 Reclassification adjustments to net earnings (a) - - ( 4,369 ) ( 4,369 ) Income tax effect 172 ( 3 ) ( 1,879 ) ( 1,710 ) Balance at November 30, 2023 $ ( 19,781 ) $ ( 1,733 ) $ 7,373 $ ( 14,141 ) Accumulated Foreign Pension Other Currency Liability Cash Flow Comprehensive (In thousands) Translation Adjustment Hedges Loss Balance at 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)(b) - 4,774 13,279 18,053 Income tax effect ( 273 ) ( 883 ) 5,462 4,306 Balance at November 30, 2022 $ ( 24,553 ) $ ( 3,387 ) $ ( 18,596 ) $ ( 46,536 ) The consolidated statement of earnings classification of amounts reclassified to net income include: (a) Cash flow hedges – See the disclosure in “ Note Q – Derivative Financial Instruments and Hedging Activities;” and (b) Pension liability adjustment – Reflects a non-cash settlement charge of $ 4,774 recognized in connection with a pension lift-out transaction completed in August 2022 for The Gerstenslager Company Bargaining Unit Employees’ Pension Plan. |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Nov. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Note L – Stock-Based Compensation Non-Qualified Stock Options During the six months ended November 30, 2023, we granted non-qualified stock options covering a total of 54 common shares, no par value, of Worthington Enterprises (the “common shares”) under our stock-based compensation plans. The exercise price of $ 69.47 per share for the non-qualified stock options granted in fiscal 2024 is equal to the closing market price of the underlying common shares on the grant date. The fair value of these non-qualified stock options, based on the Black-Scholes option-pricing model, calculated at the grant date, was $ 25.95 per share. The calculated pre-tax stock-based compensation expense for these non-qualified stock options was $ 1,401 and will be recognized on a straight-line basis over the three-year vesting period, net of any forfeitures. The following assumptions were used to value th ese non-qualified stock options: Dividend yield 2.39 % Expected volatility 43.00 % Risk-free interest rate 4.05 % Expected term (years) 6.0 Expected volatility is based on the historical volatility of the common shares and the risk-free interest rate is based on the U.S. Treasury strip rate for the expected term of the non-qualified stock options. The expected term was developed using historical exercise experience. Service-Based Restricted Common Shares During the six months ended November 30, 2023 , we granted an aggregate of 176 service-based restricted common shares under our stock-based compensation plans, which cliff vest three years from the 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 grant date, o r $ 65.97 per share. The calculated pre-tax stock-based compensation expense for these restricted common shares was $ 11,640 and will be recognized on a straight-line basis over the three-year service-based vesting period, net of any forfeitures. 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 (“adjusted EBIT”) target, in each case for the three-year periods ending May 31, 2024, 2025 and 2026. These performance share awards will be paid, to the extent earned, in common shares 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, 2023, we granted performance share awards covering an aggregate of 47 common shares (at target levels). The calculated pre-tax stock-based compensation expense for these performance shares is $ 3,235 (at target levels) . 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, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note M – Income Taxes Income tax expense for the three months ended November 30, 2023 and November 30, 2022 reflected estimated annual effective income tax rates of 23.4 % and 23.7 %, respectively, and excluded any impact from the net earnings attributable to noncontrolling interests in our consolidated statements of earnings. Net earnings attributable to noncontrolling interests are primarily a result of our WSP, Spartan, Samuel and TWB consolidated joint ventures. The net earnings attributable to the noncontrolling interests in our consolidated joint ventures’ U.S. operations do not generate tax expense to us since the investors in the consolidated joint ventures’ 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 2024 could be materially different from the forecasted rate as of November 30, 2023 . |
Earnings per Share
Earnings per Share | 6 Months Ended |
Nov. 30, 2023 | |
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 common share attributable to controlling interest for the periods presented: Three Months Ended Six Months Ended November 30, November 30, (In thousands, except per common share amounts) 2023 2022 2023 2022 Numerator (basic & diluted): Net earnings attributable to controlling interest - income available to common shareholders $ 24,302 $ 16,218 $ 120,409 $ 80,300 Denominator: Denominator for basic earnings per common share attributable to controlling interest – weighted average common shares 49,186 48,558 49,013 48,518 Effect of dilutive securities 856 772 1,089 775 Denominator for diluted earnings per common share attributable to controlling interest – adjusted weighted average common shares 50,042 49,330 50,102 49,293 Basic earnings per common share attributable to controlling interest $ 0.49 $ 0.33 $ 2.46 $ 1.66 Diluted earnings per common share attributable to controlling interest $ 0.49 $ 0.33 $ 2.40 $ 1.63 Non-qualified stock options covering 58 and 138 common shares for the three months ended November 30, 2023 and November 30, 2022 , respectively, and 46 and 127 common shares six months ended November 30, 2023 and November 30, 2022, respectively have been excluded from the computation of diluted earnings per common share because the effect would have been anti-dilutive for those periods. |
Segment Operations
Segment Operations | 6 Months Ended |
Nov. 30, 2023 | |
Segment Reporting [Abstract] | |
Segment Operations | Note O – Segment Operations Our operations are managed principally on a products and services basis. Factors used to identify reportable segments include the nature of the products and services provided by each business, the management reporting structure, similarity of economic characteristics and certain quantitative measures, as prescribed by authoritative accounting guidance. As of November 30, 2023, our operations were organized under four operating segments: Steel Processing, Consumer Products, Building Products, and Sustainable Energy Solutions. As none of the operating segments were aggregated for segment reporting purposes, they corresponded with the reportable segments. Segment information is prepared on the same basis that our chief operating decision maker (“CODM”), as defined in the accounting literature, reviews financial information for operational decision-making purposes. Factors used to identify operating segments include the nature of the products and services provided by each business, the management reporting structure, the similarity of economic characteristics and certain quantitative measures, as prescribed by authoritative accounting guidance. We have identified our Chief Executive Officer as our CODM. Our CODM assesses segment operating performance and allocates resources based on the profitability measure of adjusted EBIT. Adjusted EBIT excludes impairment and restructuring expense (income), but may also exclude other items, as described in the tables below, that management believes are not reflective of, and thus should not be included when evaluating the performance of our ongoing operations. Adjusted EBIT is a non-GAAP financial measure and is used by management to evaluate operating segment performance, engage in financial and operational planning and determine incentive compensation. Impairment charges are excluded from adjusted EBIT because they do not occur in the ordinary course of our ongoing business operations, are inherently unpredictable in timing and amount, and are non-cash, so their exclusion facilitates the comparison of historical, current and forecasted financial results. Refer to “Note E – Impairment of Long-Lived Assets” for additional information. Restructuring activities consist of established programs that are not part of our ongoing operations, such as divestitures, closing or consolidating facilities, employee severance (including rationalizing headcount or other significant changes in personnel), and realignment of existing operations (including changes to management structure in response to underlying performance and/or changing market conditions). Refer to “Note F – Restructuring and Other Expense (Income), Net” for additional information. The following table presents summarized financial information for our reportable segments for the periods indicated. Three Months Ended November 30, 2023 (In thousands) Steel Processing Consumer Products Building Products Sustainable Energy Solutions Other Consolidated Net sales $ 788,655 $ 147,738 $ 122,954 $ 27,537 $ 34 $ 1,086,918 Restructuring and other expense, net - - - - 6 6 Separation costs - - - - 21,952 21,952 Miscellaneous income (expense), net 306 12 235 557 ( 90 ) 1,020 Equity income 3,778 - 35,177 - 3,491 42,446 Adjusted EBIT (1) 6,762 9,510 40,284 ( 2,617 ) ( 1,090 ) 52,849 (1) Excludes the following items in addition to impairment and restructuring activity: • Direct and incremental costs associated with the Separation as discussed in “Note A – Basis of Presentation”; and • Our share of the pre-tax gain realized by Workhorse in connection with the sale of the joint venture’s operations in Brazil of $ 2,780 ; 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 income 1,906 - 35,107 - ( 156 ) 36,857 Adjusted EBIT (2) ( 17,249 ) 13,473 41,224 1,143 ( 3,291 ) 35,300 (2) Excludes the following items in addition to impairment and restructuring activity: • Direct and incremental costs associated with the Separation as discussed in “Note A – Basis of Presentation”; • Incremental compensation expense of $ 525 within Consumer Products related to the earnout for the acquisition of Level5 Tools, LLC (“Level5”); and • Noncontrolling interest portion of impairment of long-lived assets of $ 1,850 within Steel Processing. Six Months Ended November 30, 2023 (in thousands) Steel Processing Consumer Products Building Products Sustainable Energy Solutions Other Consolidated Net sales $ 1,669,993 $ 297,151 $ 256,822 $ 56,174 $ 34 $ 2,280,174 Impairment of long-lived assets 1,401 - - - - 1,401 Restructuring and other expense, net - - - - 6 6 Separation costs - - - - 27,987 27,987 Miscellaneous income (expense), net 1,018 43 292 838 ( 160 ) 2,031 Loss on extinguishment of debt - - - - ( 1,534 ) ( 1,534 ) Equity income 12,735 - 80,219 - 3,873 96,827 Adjusted EBIT (3) 84,762 18,502 94,300 ( 7,339 ) ( 959 ) 189,266 (3) Excludes the following in addition to impairment and restructuring activity: • Direct and incremental costs associated with the Separation as discussed in “Note A – Basis of Presentation”; • The pre-tax loss on extinguishment of debt resulting from the redemption of the 2026 Notes, in full, on July 28, 2023; and • Noncontrolling interest portion of impairment of long-lived assets of $ 519 within Steel Processing. 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 income 3,676 - 78,973 - ( 14,080 ) 68,569 Adjusted EBIT (4) 17,663 34,406 93,959 ( 250 ) 1,854 147,632 (4) Excludes the following in addition to impairment and restructuring activity: • Direct and incremental costs associated with the Separation as discussed in “Note A – Basis of Presentation.” • A non-cash settlement charge of $ 4,774 in miscellaneous income (expense), net within Other related to the pension lift-out transaction associated with the Gerstenslager Company Bargaining Unit Employees’ Pension Plan; • A loss of $ 15,759 within equity income related to the August 31, 2022, sale of our 50 % noncontrolling interest in ArtiFlex; • Incremental compensation expense of $ 1,050 within Consumer Products related to the Level5 earnout agreement; and • Noncontrolling interest portion of the restructuring gain within Steel processing of $ 1,734 within Steel Processing. Total assets for each of our reportable segments at the dates indicated were as follows: November 30, May 31, (In thousands) 2023 2023 Total assets Steel Processing $ 1,834,226 $ 1,758,981 Consumer Products 622,304 615,430 Building Products 611,771 635,650 Sustainable Energy Solutions 103,448 129,872 Other 412,388 510,985 Total assets $ 3,584,137 $ 3,650,918 |
Acquisitions
Acquisitions | 6 Months Ended |
Nov. 30, 2023 | |
Business Combinations [Abstract] | |
Acquisitions | Note P – Acquisitions Tempel Steel Europe GmbH On November 16, 2023, the Company acquired Voestalpine Automotive Components Nagold GmbH & Co. KG, a facility in Nagold, Germany for net cash consideration of $ 21,013 and the assumption of a $ 929 pension liability. The business, which will operate as Tempel Steel Europe GmbH (Tempel Steel Europe), provides automotive and electrical steel lamination stamping in Europe. The total purchase consideration was allocated primarily to tangible assets, consisting of $ 12,282 of property, plant and equipment and $ 9,069 of net working capital, with the residual recognized as goodwill. The information included herein has been prepared 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 the Company. The purchase price includes the fair values of other assets that were not identifiable, not separately recognizable under accounting rules (e.g., assembled workforce) or of immaterial value. The purchase price also includes strategic benefits specific to us, which resulted in a purchase price in excess of the fair value of the identifiable net assets. The goodwill resulting from the acquisition equaled approximately $ 591 and will be deductible for income tax purposes. The results of operations have been included in our combined statements of earnings since the date of acquisition. Proforma results, including the acquired business since the beginning of fiscal 2023, would not be materially different from the reported results. Level5 Tools, LLC On June 2, 2022, we acquired Level5, a leading provider of drywall tools and related accessories. The total purchase price was $ 59,321 , including $ 2,000 attributed to an earnout agreement with the selling shareholders, that provides for up to an additional $ 25,000 of cash consideration should certain earnings targets be met annually through calendar year 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. As of November 30, 2023, no amounts were accrued as compensation expense for anticipated payments under the second earnout period ending December 31, 2023. 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 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 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 for income tax purposes. The following table summarizes the consideration paid and the final fair value assigned to the assets and liabilities assumed at the acquisition date. (In thousands) Preliminary Measurement Final 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, 2023 | |
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, 2023: Asset Derivatives Liability Derivatives Balance Balance Sheet Fair Sheet Fair (In thousands) Location Value Location Value Derivatives designated as hedging instruments: Commodity contracts Receivables $ 12,498 Accounts payable $ 3,743 Other assets 47 Other liabilities - 12,545 3,743 Subtotals $ 12,545 $ 3,743 Derivatives not designated as hedging instruments: Commodity contracts Receivables $ 2,476 Accounts payable $ 2,609 Other assets - Other liabilities 39 Subtotals 2,476 2,648 Total derivative financial instruments $ 15,021 $ 6,391 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 $ 5,150 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, 2023: Asset Derivatives Liability Derivatives Balance Balance Sheet Fair Sheet Fair (In thousands) Location Value Location Value Derivatives designated as hedging instruments: Commodity contracts Receivables $ 20 Accounts payable $ 6,749 Other assets 51 Other liabilities 379 71 7,128 Foreign currency exchange contracts Receivables - Accounts payable 33 - 33 Subtotals $ 71 $ 7,161 Derivatives not designated as hedging instruments: Commodity contracts Receivables $ 2,539 Accounts payable $ 8,604 Other assets - Other liabilities 35 Subtotals 2,539 8,639 Total derivative financial instruments $ 2,610 $ 15,800 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 $ 7,576 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, 2023: Notional (In thousands) Amount Maturity Date Commodity contracts $ 62,825 December 2023 - June 2025 The following table summarizes the gain (loss) recognized in OCI and the gain (loss) reclassified from 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, 2023: Commodity contracts $ 15,019 Cost of goods sold $ ( 2,360 ) Interest rate contracts - Interest expense, net 52 Foreign currency exchange contracts ( 34 ) Net sales/Cost of goods sold ( 97 ) Total $ 14,985 $ ( 2,405 ) 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 six months ended November 30, 2023: Commodity contracts $ 12,958 Cost of goods sold $ 4,970 Interest rate contracts - Loss on extinguishment of debt ( 641 ) Interest rate contracts - Interest expense, net 84 Foreign currency exchange contracts ( 11 ) Net sales/Cost of goods sold ( 44 ) Total $ 12,947 $ 4,369 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 ) The estimated net amount of the gain recognized in AOCI at November 30, 2023 expected to be reclassified into net earnings within the succeeding twelve months is $ 7,678 (net of tax of $ 1,703 ). This amount was computed using the fair value of the cash flow hedges at November 30, 2023, and will change before actual reclassification from OCI to net earnings during the fiscal years ending May 31, 2024 and May 31, 2025. 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, 2023: Notional (In thousands) Amount Maturity Date(s) Commodity contracts $ 15,509 September 2023 - December 2024 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 2023 2022 Commodity contracts Cost of goods sold $ 1,459 $ 3,861 Foreign currency exchange contracts Miscellaneous income, net - ( 47 ) Total $ 1,459 $ 3,814 Gain (Loss) Recognized in Earnings for the Location of Gain (Loss) Six Months Ended November 30, (In thousands) Recognized in Earnings 2023 2022 Commodity contracts Cost of goods sold $ 395 $ 2,284 Foreign currency exchange contracts Miscellaneous income, net - ( 141 ) Total $ 395 $ 2,143 |
Fair Value
Fair Value | 6 Months Ended |
Nov. 30, 2023 | |
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, 2023, 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) $ - $ 15,021 $ - $ 15,021 Total assets $ - $ 15,021 $ - $ 15,021 Liabilities Derivative financial instruments (1) $ - $ 6,391 $ - $ 6,391 Total liabilities $ - $ 6,391 $ - $ 6,391 (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, 2023, 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) $ - $ 2,610 $ - $ 2,610 Total assets $ - $ 2,610 $ - $ 2,610 Liabilities Derivative financial instruments (1) $ - $ 15,800 $ - $ 15,800 Total liabilities $ - $ 15,800 $ - $ 15,800 (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, 2023 , there were no assets measured at fair value on a non-recurring basis on our consolidated balance sheet. At May 31, 2023, 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) $ - $ 2,623 $ - $ 2,623 Long-lived assets held and used (2) - 70 - 70 Total assets $ - $ 2,693 $ - $ 2,693 (1) Comprised of the following: (a) idled equipment at the manufacturing facility in Taylor, Michigan; and (b) the net assets of our former toll processing facility in Cleveland, Ohio. (2) Comprised of certain assets associated with a capital project at our Building Products facility in Jefferson, Ohio which were written down to their estimated salvage value of $ 70 . 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 $ 391,947 and $ 639,948 at November 30, 2023 and May 31, 2023, respectively. The carrying amount of long-term debt, including current maturities, was $ 448,818 and $ 689,982 at November 30, 2023 and May 31, 2023, respectively. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Nov. 30, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note S – Subsequent Events On December 1, 2023, we completed the Separation. The Board of Directors of Worthington Enterprises (the “Board”) approved the completion of the Separation on November 9, 2023, which was effected by the Distribution by Worthington Enterprises of all of the outstanding common stock of Worthington Steel on December 1, 2023 to Worthington Enterprises stockholders who held its common shares as of the close of business on the Record Date. As part of the Distribution, each Worthington Enterprises stockholder of record as of the Record Date received one common share of Worthington Steel for every one common share of Worthington Enterprises held as of the Record Date. Refer to “Note A – Basis of Presentation” for additional information. In connection with the Separation, we received a cash payment of $ 150,000 from Worthington Steel, which was funded by the Worthington Steel Credit Facility. On December 6, 2023, we used these cash proceeds to finalize our post-separation capital structure by redeeming, in full, the $ 150,000 senior unsecured notes that were set to mature in August 2024 . |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 6 Months Ended |
Nov. 30, 2023 | |
Disaggregation Of Revenue [Line Items] | |
Revenue by Product Class and Over Time | The following table summarizes net sales by operating segment and product class within the Steel Processing operating segment for the periods presented: Three Months Ended Six Months Ended November 30, November 30, (In thousands) 2023 2022 2023 2022 Steel Processing Direct $ 750,622 $ 807,259 $ 1,595,985 $ 1,809,394 Toll 38,033 34,688 74,008 71,433 Total 788,655 841,947 1,669,993 1,880,827 Consumer Products 147,738 153,795 297,151 342,497 Building Products 122,954 141,671 256,822 291,994 Sustainable Energy Solutions 27,537 38,128 56,174 68,888 Other 34 - 34 - Total $ 1,086,918 $ 1,175,541 $ 2,280,174 $ 2,584,206 |
Summary of Unbilled Receivable | The following table summarizes the unbilled receivables at the dates indicated: November 30, May 31, (In thousands) Balance Sheet Classification 2023 2023 Unbilled receivables Receivables $ 4,148 $ 3,708 |
Investments in Unconsolidated_2
Investments in Unconsolidated Affiliates (Tables) | 6 Months Ended |
Nov. 30, 2023 | |
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) 2023 2023 Cash and cash equivalents $ 37,728 $ 49,185 Other current assets 871,945 899,913 Noncurrent assets 372,258 394,468 Total assets $ 1,281,931 $ 1,343,566 Current liabilities 282,320 247,796 Current maturities of long-term debt - 36,936 Long-term debt 349,323 349,215 Other noncurrent liabilities 138,566 144,649 Equity 511,722 564,970 Total liabilities and equity $ 1,281,931 $ 1,343,566 Three Months Ended Six Months Ended November 30, November 30, (In thousands) 2023 2022 2023 2022 Net sales $ 676,875 $ 711,665 $ 1,397,308 $ 1,535,607 Gross margin 166,939 147,299 361,247 328,704 Operating income 134,120 107,356 283,529 245,183 Depreciation and amortization 8,303 6,864 16,946 15,052 Interest expense 4,538 3,910 10,277 6,590 Income tax expense 6,708 1,262 8,354 3,372 Net earnings 122,670 105,183 266,236 238,421 |
Debt and Receivables Securiti_2
Debt and Receivables Securitization (Tables) | 6 Months Ended |
Nov. 30, 2023 | |
Debt Disclosure [Abstract] | |
Summary of Long-term Debt and Short-term Borrowings Outstanding | The following table summarizes our long-term debt and short-term borrowings outstanding at November 30, 2023 and May 31, 2023: November 30, May 31, (In thousands) 2023 2023 Short-term borrowings $ 175,000 $ 2,813 4.60 % senior notes due August 10, 2024 150,000 150,000 4.55 % senior notes due April 15, 2026 - 243,623 4.30 % senior notes due August 1, 2032 200,000 200,000 1.56 % Series A senior note due August 23, 2031 39,962 39,226 1.90 % Series B senior notes due August 23, 2034 59,887 58,786 Other 402 528 Total debt 625,251 694,976 Unamortized discount and debt issuance costs ( 1,433 ) ( 2,181 ) Total debt, net 623,818 692,795 Less: current maturities and short-term borrowings 325,269 3,077 Total long-term debt $ 298,549 $ 689,718 |
Maturities of Long-term Debt and Short-term Borrowings | Maturities of long-term debt and short-term borrowings in fiscal 2024 year and the four fiscal years thereafter, are as follows: (In thousands) 2024 (1) $ 175,133 2025 150,269 2026 - 2027 - 2028 - Thereafter 299,849 Total $ 625,251 (1) Includes $ 175,000 associated with the Worthington Steel Credit Facility (as defined below). Subsequent to the Separation on December 1, 2023, we have no remaining obligation. See the “Other Financing Arrangements” section below for additional information. |
Other Comprehensive Income (L_2
Other Comprehensive Income (Loss) (Tables) | 6 Months Ended |
Nov. 30, 2023 | |
Equity [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, 2023 November 30, 2022 (In thousands) Before-Tax Tax Net-of-Tax Before-Tax Tax Net-of-Tax Foreign currency translation $ 843 $ 54 $ 897 $ 550 $ 308 $ 858 Pension liability adjustment - - - 15 ( 97 ) ( 82 ) Cash flow hedges 17,390 ( 3,841 ) 13,549 ( 5,665 ) 1,665 ( 4,000 ) Other comprehensive income (loss) $ 18,233 $ ( 3,787 ) $ 14,446 $ ( 5,100 ) $ 1,876 $ ( 3,224 ) Six Months Ended November 30, 2023 November 30, 2022 (In thousands) Before-Tax Tax Net-of-Tax Before-Tax Tax Net-of-Tax Foreign currency translation $ 2,170 $ 172 $ 2,342 $ ( 8,970 ) $ ( 273 ) $ ( 9,243 ) Pension liability adjustment - ( 3 ) ( 3 ) 3,740 ( 883 ) 2,857 Cash flow hedges 8,578 ( 1,879 ) 6,699 ( 22,762 ) 5,462 ( 17,300 ) Other comprehensive income (loss) $ 10,748 $ ( 1,710 ) $ 9,038 $ ( 27,992 ) $ 4,306 $ ( 23,686 ) |
Changes in Equity (Tables)
Changes in Equity (Tables) | 6 Months Ended |
Nov. 30, 2023 | |
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 Income (Loss), Retained controlling (In thousands) Capital Net of Tax Earnings Subtotal Interests Total Balance at May 31, 2023 $ 290,799 $ ( 23,179 ) $ 1,428,391 $ 1,696,011 $ 125,617 $ 1,821,628 Net earnings - - 96,106 96,106 3,597 99,703 Other comprehensive loss - ( 5,408 ) - ( 5,408 ) - ( 5,408 ) Common shares issued, net of withholding tax ( 5,130 ) - - ( 5,130 ) - ( 5,130 ) Common shares in non-qualified plans 130 - - 130 - 130 Stock-based compensation 8,995 - - 8,995 - 8,995 Cash dividends declared - - ( 16,081 ) ( 16,081 ) - ( 16,081 ) Dividends to noncontrolling interests - - - - ( 1,921 ) ( 1,921 ) Balance at August 31, 2023 $ 294,794 $ ( 28,587 ) $ 1,508,416 $ 1,774,623 $ 127,293 $ 1,901,916 Net earnings - - 24,302 24,302 3,865 28,167 Other comprehensive income - 14,446 - 14,446 - 14,446 Common shares issued, net of withholding tax ( 9,207 ) - - ( 9,207 ) - ( 9,207 ) Common shares in non-qualified plans 195 - - 195 - 195 Stock-based compensation 4,511 - - 4,511 - 4,511 Cash dividends declared - - ( 16,061 ) ( 16,061 ) - ( 16,061 ) Balance at November 30, 2023 $ 290,293 $ ( 14,141 ) $ 1,516,657 $ 1,792,809 $ 131,158 $ 1,923,967 Controlling Interest Accumulated Other Additional Comprehensive Non- Paid-in Income (Loss), Retained controlling (In thousands) Capital Net of Tax Earnings Subtotal 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 interests - - - - ( 11,760 ) ( 11,760 ) Balance at November 30, 2022 $ 280,354 $ ( 46,536 ) $ 1,279,575 $ 1,513,393 $ 125,899 $ 1,639,292 |
Summary of Changes in Accumulated OCI | The following table summarizes the changes in accumulated OCI for the periods presented: Accumulated Foreign Pension Other Currency Liability Cash Flow Comprehensive (In thousands) Translation Adjustment Hedges Loss Balance at May 31, 2023 $ ( 22,123 ) $ ( 1,730 ) $ 674 $ ( 23,179 ) Other comprehensive income before reclassifications 2,170 - 12,947 15,117 Reclassification adjustments to net earnings (a) - - ( 4,369 ) ( 4,369 ) Income tax effect 172 ( 3 ) ( 1,879 ) ( 1,710 ) Balance at November 30, 2023 $ ( 19,781 ) $ ( 1,733 ) $ 7,373 $ ( 14,141 ) Accumulated Foreign Pension Other Currency Liability Cash Flow Comprehensive (In thousands) Translation Adjustment Hedges Loss Balance at 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)(b) - 4,774 13,279 18,053 Income tax effect ( 273 ) ( 883 ) 5,462 4,306 Balance at November 30, 2022 $ ( 24,553 ) $ ( 3,387 ) $ ( 18,596 ) $ ( 46,536 ) The consolidated statement of earnings classification of amounts reclassified to net income include: (a) Cash flow hedges – See the disclosure in “ Note Q – Derivative Financial Instruments and Hedging Activities;” and (b) Pension liability adjustment – Reflects a non-cash settlement charge of $ 4,774 recognized in connection with a pension lift-out transaction completed in August 2022 for The Gerstenslager Company Bargaining Unit Employees’ Pension Plan. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Nov. 30, 2023 | |
Non-Qualified Stock Options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Assumptions Used to Determine Fair Value of Non-qualified Stock Options | The following assumptions were used to value th ese non-qualified stock options: Dividend yield 2.39 % Expected volatility 43.00 % Risk-free interest rate 4.05 % Expected term (years) 6.0 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 6 Months Ended |
Nov. 30, 2023 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Earnings Per Common Share Attributable to Controlling Interest | The following table sets forth the computation of basic and diluted earnings per common share attributable to controlling interest for the periods presented: Three Months Ended Six Months Ended November 30, November 30, (In thousands, except per common share amounts) 2023 2022 2023 2022 Numerator (basic & diluted): Net earnings attributable to controlling interest - income available to common shareholders $ 24,302 $ 16,218 $ 120,409 $ 80,300 Denominator: Denominator for basic earnings per common share attributable to controlling interest – weighted average common shares 49,186 48,558 49,013 48,518 Effect of dilutive securities 856 772 1,089 775 Denominator for diluted earnings per common share attributable to controlling interest – adjusted weighted average common shares 50,042 49,330 50,102 49,293 Basic earnings per common share attributable to controlling interest $ 0.49 $ 0.33 $ 2.46 $ 1.66 Diluted earnings per common share attributable to controlling interest $ 0.49 $ 0.33 $ 2.40 $ 1.63 |
Segment Operations (Tables)
Segment Operations (Tables) | 6 Months Ended |
Nov. 30, 2023 | |
Segment Reporting [Abstract] | |
Financial Information for Reportable Segments | The following table presents summarized financial information for our reportable segments for the periods indicated. Three Months Ended November 30, 2023 (In thousands) Steel Processing Consumer Products Building Products Sustainable Energy Solutions Other Consolidated Net sales $ 788,655 $ 147,738 $ 122,954 $ 27,537 $ 34 $ 1,086,918 Restructuring and other expense, net - - - - 6 6 Separation costs - - - - 21,952 21,952 Miscellaneous income (expense), net 306 12 235 557 ( 90 ) 1,020 Equity income 3,778 - 35,177 - 3,491 42,446 Adjusted EBIT (1) 6,762 9,510 40,284 ( 2,617 ) ( 1,090 ) 52,849 (1) Excludes the following items in addition to impairment and restructuring activity: • Direct and incremental costs associated with the Separation as discussed in “Note A – Basis of Presentation”; and • Our share of the pre-tax gain realized by Workhorse in connection with the sale of the joint venture’s operations in Brazil of $ 2,780 ; 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 income 1,906 - 35,107 - ( 156 ) 36,857 Adjusted EBIT (2) ( 17,249 ) 13,473 41,224 1,143 ( 3,291 ) 35,300 (2) Excludes the following items in addition to impairment and restructuring activity: • Direct and incremental costs associated with the Separation as discussed in “Note A – Basis of Presentation”; • Incremental compensation expense of $ 525 within Consumer Products related to the earnout for the acquisition of Level5 Tools, LLC (“Level5”); and • Noncontrolling interest portion of impairment of long-lived assets of $ 1,850 within Steel Processing. Six Months Ended November 30, 2023 (in thousands) Steel Processing Consumer Products Building Products Sustainable Energy Solutions Other Consolidated Net sales $ 1,669,993 $ 297,151 $ 256,822 $ 56,174 $ 34 $ 2,280,174 Impairment of long-lived assets 1,401 - - - - 1,401 Restructuring and other expense, net - - - - 6 6 Separation costs - - - - 27,987 27,987 Miscellaneous income (expense), net 1,018 43 292 838 ( 160 ) 2,031 Loss on extinguishment of debt - - - - ( 1,534 ) ( 1,534 ) Equity income 12,735 - 80,219 - 3,873 96,827 Adjusted EBIT (3) 84,762 18,502 94,300 ( 7,339 ) ( 959 ) 189,266 (3) Excludes the following in addition to impairment and restructuring activity: • Direct and incremental costs associated with the Separation as discussed in “Note A – Basis of Presentation”; • The pre-tax loss on extinguishment of debt resulting from the redemption of the 2026 Notes, in full, on July 28, 2023; and • Noncontrolling interest portion of impairment of long-lived assets of $ 519 within Steel Processing. 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 income 3,676 - 78,973 - ( 14,080 ) 68,569 Adjusted EBIT (4) 17,663 34,406 93,959 ( 250 ) 1,854 147,632 (4) Excludes the following in addition to impairment and restructuring activity: • Direct and incremental costs associated with the Separation as discussed in “Note A – Basis of Presentation.” • A non-cash settlement charge of $ 4,774 in miscellaneous income (expense), net within Other related to the pension lift-out transaction associated with the Gerstenslager Company Bargaining Unit Employees’ Pension Plan; • A loss of $ 15,759 within equity income related to the August 31, 2022, sale of our 50 % noncontrolling interest in ArtiFlex; • Incremental compensation expense of $ 1,050 within Consumer Products related to the Level5 earnout agreement; and • Noncontrolling interest portion of the restructuring gain within Steel processing of $ 1,734 within Steel Processing. Total assets for each of our reportable segments at the dates indicated were as follows: November 30, May 31, (In thousands) 2023 2023 Total assets Steel Processing $ 1,834,226 $ 1,758,981 Consumer Products 622,304 615,430 Building Products 611,771 635,650 Sustainable Energy Solutions 103,448 129,872 Other 412,388 510,985 Total assets $ 3,584,137 $ 3,650,918 |
Acquisitions (Tables)
Acquisitions (Tables) | 6 Months Ended |
Nov. 30, 2023 | |
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 paid and the final fair value assigned to the assets and liabilities assumed at the acquisition date. (In thousands) Preliminary Measurement Final 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 |
Level5 Tools, LLC | |
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 The purchase price includes the fair values of other assets that were not identifiable, not separately recognizable under 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 for income tax purposes. |
Derivative Financial Instrume_2
Derivative Financial Instruments and Hedging Activities (Tables) | 6 Months Ended |
Nov. 30, 2023 | |
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, 2023: Asset Derivatives Liability Derivatives Balance Balance Sheet Fair Sheet Fair (In thousands) Location Value Location Value Derivatives designated as hedging instruments: Commodity contracts Receivables $ 12,498 Accounts payable $ 3,743 Other assets 47 Other liabilities - 12,545 3,743 Subtotals $ 12,545 $ 3,743 Derivatives not designated as hedging instruments: Commodity contracts Receivables $ 2,476 Accounts payable $ 2,609 Other assets - Other liabilities 39 Subtotals 2,476 2,648 Total derivative financial instruments $ 15,021 $ 6,391 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, 2023: Asset Derivatives Liability Derivatives Balance Balance Sheet Fair Sheet Fair (In thousands) Location Value Location Value Derivatives designated as hedging instruments: Commodity contracts Receivables $ 20 Accounts payable $ 6,749 Other assets 51 Other liabilities 379 71 7,128 Foreign currency exchange contracts Receivables - Accounts payable 33 - 33 Subtotals $ 71 $ 7,161 Derivatives not designated as hedging instruments: Commodity contracts Receivables $ 2,539 Accounts payable $ 8,604 Other assets - Other liabilities 35 Subtotals 2,539 8,639 Total derivative financial instruments $ 2,610 $ 15,800 |
Schedule of Summary of Derivative Hedges | The following table summarizes our economic (non-designated) derivative financial instruments outstanding at November 30, 2023: Notional (In thousands) Amount Maturity Date(s) Commodity contracts $ 15,509 September 2023 - December 2024 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 2023 2022 Commodity contracts Cost of goods sold $ 1,459 $ 3,861 Foreign currency exchange contracts Miscellaneous income, net - ( 47 ) Total $ 1,459 $ 3,814 Gain (Loss) Recognized in Earnings for the Location of Gain (Loss) Six Months Ended November 30, (In thousands) Recognized in Earnings 2023 2022 Commodity contracts Cost of goods sold $ 395 $ 2,284 Foreign currency exchange contracts Miscellaneous income, net - ( 141 ) Total $ 395 $ 2,143 |
Cash Flow Hedges | |
Schedule of Summary of Derivative Hedges | The following table summarizes our cash flow hedges outstanding at November 30, 2023: Notional (In thousands) Amount Maturity Date Commodity contracts $ 62,825 December 2023 - June 2025 The following table summarizes the gain (loss) recognized in OCI and the gain (loss) reclassified from 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, 2023: Commodity contracts $ 15,019 Cost of goods sold $ ( 2,360 ) Interest rate contracts - Interest expense, net 52 Foreign currency exchange contracts ( 34 ) Net sales/Cost of goods sold ( 97 ) Total $ 14,985 $ ( 2,405 ) 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 six months ended November 30, 2023: Commodity contracts $ 12,958 Cost of goods sold $ 4,970 Interest rate contracts - Loss on extinguishment of debt ( 641 ) Interest rate contracts - Interest expense, net 84 Foreign currency exchange contracts ( 11 ) Net sales/Cost of goods sold ( 44 ) Total $ 12,947 $ 4,369 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 ) |
Fair Value (Tables)
Fair Value (Tables) | 6 Months Ended |
Nov. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis | At November 30, 2023, 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) $ - $ 15,021 $ - $ 15,021 Total assets $ - $ 15,021 $ - $ 15,021 Liabilities Derivative financial instruments (1) $ - $ 6,391 $ - $ 6,391 Total liabilities $ - $ 6,391 $ - $ 6,391 (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, 2023, 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) $ - $ 2,610 $ - $ 2,610 Total assets $ - $ 2,610 $ - $ 2,610 Liabilities Derivative financial instruments (1) $ - $ 15,800 $ - $ 15,800 Total liabilities $ - $ 15,800 $ - $ 15,800 (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, 2023, 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) $ - $ 2,623 $ - $ 2,623 Long-lived assets held and used (2) - 70 - 70 Total assets $ - $ 2,693 $ - $ 2,693 (1) Comprised of the following: (a) idled equipment at the manufacturing facility in Taylor, Michigan; and (b) the net assets of our former toll processing facility in Cleveland, Ohio. (2) Comprised of certain assets associated with a capital project at our Building Products facility in Jefferson, Ohio which were written down to their estimated salvage value of $ 70 . |
Basis of Presentation - Additio
Basis of Presentation - Additional Information (Detail) $ in Thousands | 6 Months Ended |
Nov. 30, 2023 USD ($) Jointventure | |
Significant Accounting Policies [Line Items] | |
Third-party advisory fees | $ 15,760 |
Non-recurring employee-related costs | 7,093 |
Incremental compensation expense | $ 5,437 |
Joint Venture Transactions | |
Significant Accounting Policies [Line Items] | |
Number of operating joint ventures | Jointventure | 3 |
Spartan | Joint Venture Transactions | |
Significant Accounting Policies [Line Items] | |
Percent of controlling interest by the Company | 52% |
TWB | Joint Venture Transactions | |
Significant Accounting Policies [Line Items] | |
Percent of controlling interest by the Company | 55% |
Samuel | Joint Venture Transactions | |
Significant Accounting Policies [Line Items] | |
Percent of controlling interest by the Company | 63% |
Worthington Specialty Processing | Joint Venture Transactions | |
Significant Accounting Policies [Line Items] | |
Percent of controlling interest by the Company | 51% |
Inventory - Additional Informat
Inventory - Additional Information (Detail) $ in Thousands | Nov. 30, 2023 USD ($) |
Balloon Time Mini Helium Tanks | |
Inventory [Line Items] | |
Inventory obsolescence reserve | $ 3,000 |
Revenue Recognition - Revenue b
Revenue Recognition - Revenue by Product Class and Timing (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Nov. 30, 2023 | Nov. 30, 2022 | Nov. 30, 2023 | Nov. 30, 2022 | |
Disaggregation Of Revenue [Line Items] | ||||
Net sales | $ 1,086,918 | $ 1,175,541 | $ 2,280,174 | $ 2,584,206 |
Steel Processing | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | 788,655 | 841,947 | 1,669,993 | 1,880,827 |
Direct | Steel Processing | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | 750,622 | 807,259 | 1,595,985 | 1,809,394 |
Toll | Steel Processing | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | 38,033 | 34,688 | 74,008 | 71,433 |
Building Products | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | 122,954 | 141,671 | 256,822 | 291,994 |
Consumer Products | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | 147,738 | 153,795 | 297,151 | 342,497 |
Sustainable Energy Solutions | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | 27,537 | $ 38,128 | 56,174 | $ 68,888 |
Other | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | $ 34 | $ 34 |
Revenue Recognition - Summary o
Revenue Recognition - Summary of Unbilled Receivables (Detail) - USD ($) $ in Thousands | Nov. 30, 2023 | May 31, 2023 |
Receivables | ||
Unbilled Receivables And Contract Assets [Line Items] | ||
Unbilled receivables | $ 4,148 | $ 3,708 |
Revenue Recognition - Additiona
Revenue Recognition - Additional Information (Detail) - USD ($) $ in Thousands | Nov. 30, 2023 | May 31, 2023 |
Revenue from Contract with Customer [Abstract] | ||
Contract assets | $ 0 | $ 0 |
Investments in Unconsolidated_3
Investments in Unconsolidated Affiliates - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Aug. 03, 2022 | Nov. 30, 2023 | Nov. 30, 2023 | Nov. 30, 2022 | May 31, 2023 | Aug. 31, 2022 | |
Investments in and Advances to Affiliates [Line Items] | ||||||
Distributions from unconsolidated affiliates | $ 104,008 | |||||
Investments in unconsolidated affiliates | $ 247,421 | 247,421 | $ 252,591 | |||
Dividends received from investing activity | $ 1,085 | $ 1,085 | ||||
Pre-tax loss on sale of equity | $ (15,759) | |||||
ArtiFlex | ||||||
Investments in and Advances to Affiliates [Line Items] | ||||||
Percent of ownership interest held in unconsolidated affiliates | 50% | 50% | 50% | |||
Equity method investment sold amount after adjustments for closing debt and final net working capital | $ 36,095 | |||||
Pre-tax loss on sale of equity | $ (15,759) | |||||
ClarkDietrich | ||||||
Investments in and Advances to Affiliates [Line Items] | ||||||
Percent of ownership interest held in unconsolidated affiliates | 25% | 25% | ||||
Workhorse | ||||||
Investments in and Advances to Affiliates [Line Items] | ||||||
Percent of ownership interest held in unconsolidated affiliates | 20% | 20% | ||||
Workhorse | Brazil | ||||||
Investments in and Advances to Affiliates [Line Items] | ||||||
Gain (Loss) on investments | $ 2,780 | |||||
Serviacero Worthington | ||||||
Investments in and Advances to Affiliates [Line Items] | ||||||
Percent of ownership interest held in unconsolidated affiliates | 50% | 50% | ||||
WAVE | ||||||
Investments in and Advances to Affiliates [Line Items] | ||||||
Percent of ownership interest held in unconsolidated affiliates | 50% | 50% | ||||
Investments in unconsolidated affiliates | $ 118,465 | $ 118,465 | $ 117,297 | |||
Dividends received from investing activity | $ 1,085 |
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, 2023 | Aug. 31, 2023 | Nov. 30, 2022 | Aug. 31, 2022 | Nov. 30, 2023 | Nov. 30, 2022 | May 31, 2023 | |
Investments in and Advances to Affiliates [Line Items] | |||||||
Cash and cash equivalents | $ 430,906 | $ 430,906 | $ 454,946 | ||||
Total assets | 3,584,137 | 3,584,137 | 3,650,918 | ||||
Current liabilities | 945,342 | 945,342 | 717,558 | ||||
Short-term borrowings | 175,000 | 175,000 | 2,813 | ||||
Current maturities of long-term debt | 150,269 | 150,269 | 264 | ||||
Long-term debt | 298,549 | 298,549 | 689,718 | ||||
Other noncurrent liabilities | 112,878 | 112,878 | 113,286 | ||||
Equity | 1,792,809 | 1,792,809 | 1,696,011 | ||||
Total liabilities and equity | 3,584,137 | 3,584,137 | 3,650,918 | ||||
Net sales | 1,086,918 | $ 1,175,541 | 2,280,174 | $ 2,584,206 | |||
Gross margin | 123,714 | 105,763 | 321,203 | 275,137 | |||
Operating income | (5,932) | (7,014) | 71,773 | 59,700 | |||
Depreciation and amortization | 28,007 | 28,354 | 56,332 | 56,355 | |||
Income tax expense | 7,198 | 4,131 | 35,975 | 23,629 | |||
Net earnings | 28,167 | $ 99,703 | 19,505 | $ 65,244 | 127,870 | 84,749 | |
Equity Method Investment, Nonconsolidated Investee, Other | |||||||
Investments in and Advances to Affiliates [Line Items] | |||||||
Cash and cash equivalents | 37,728 | 37,728 | 49,185 | ||||
Other current assets | 871,945 | 871,945 | 899,913 | ||||
Noncurrent assets | 372,258 | 372,258 | 394,468 | ||||
Total assets | 1,281,931 | 1,281,931 | 1,343,566 | ||||
Current liabilities | 282,320 | 282,320 | 247,796 | ||||
Current maturities of long-term debt | 36,936 | ||||||
Long-term debt | 349,323 | 349,323 | 349,215 | ||||
Other noncurrent liabilities | 138,566 | 138,566 | 144,649 | ||||
Equity | 511,722 | 511,722 | 564,970 | ||||
Total liabilities and equity | 1,281,931 | 1,281,931 | $ 1,343,566 | ||||
Net sales | 676,875 | 711,665 | 1,397,308 | 1,535,607 | |||
Gross margin | 166,939 | 147,299 | 361,247 | 328,704 | |||
Operating income | 134,120 | 107,356 | 283,529 | 245,183 | |||
Depreciation and amortization | 8,303 | 6,864 | 16,946 | 15,052 | |||
Interest expense | 4,538 | 3,910 | 10,277 | 6,590 | |||
Income tax expense | 6,708 | 1,262 | 8,354 | 3,372 | |||
Net earnings | $ 122,670 | $ 105,183 | $ 266,236 | $ 238,421 |
Impairment of Long-Lived Asse_2
Impairment of Long-Lived Assets - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Aug. 31, 2023 | Aug. 31, 2022 | Nov. 30, 2023 | Nov. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Impairment charge of long-lived assets | $ 1,401 | $ 312 | $ 1,401 | $ 312 |
Estimate of fair value less costs to sell | $ 150 |
Restructuring and Other Expen_2
Restructuring and Other Expenses (Income), Net - Additional Information (Detail) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Oct. 31, 2022 | Jun. 14, 2022 | Nov. 30, 2023 | Nov. 30, 2022 | Nov. 30, 2023 | Nov. 30, 2022 | |
Restructuring Cost and Reserve [Line Items] | ||||||
Severance payments | $ 141,000 | |||||
Restructuring liabilities | $ 0 | 0 | ||||
Restructuring and other expense, net | $ 6,000 | $ (4,282,000) | $ 6,000 | $ (5,382,000) | ||
Net cash proceeds | $ 5,775,000 | |||||
WSP Joint Venture | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Net cash proceeds | $ 21,277,000 | |||||
Pre-tax gain on sale of joint venture facility | $ 3,926,000 |
Guarantees - Additional Informa
Guarantees - Additional Information (Detail) | 6 Months Ended |
Nov. 30, 2023 USD ($) | |
Stand-by Letters of Credit | |
Guarantor Obligations [Line Items] | |
Letter of credit amount outstanding | $ 12,137,000 |
Drawn amount of letter of credit outstanding | 0 |
Operating Lease of Aircraft | |
Guarantor Obligations [Line Items] | |
Maximum potential obligation | $ 16,143,000 |
Debt and Receivables Securiti_3
Debt and Receivables Securitization - Summary of Long-term Debt and Short-term Borrowings Outstanding (Detail) - USD ($) $ in Thousands | Nov. 30, 2023 | May 31, 2023 |
Debt Instrument [Line Items] | ||
Short-term borrowings | $ 175,000 | $ 2,813 |
Total debt | 625,251 | 694,976 |
Unamortized discount and debt issuance costs | (1,433) | (2,181) |
Total debt, net | 623,818 | 692,795 |
Less: current maturities and short-term borrowings | 325,269 | 3,077 |
Total long-term debt | 298,549 | 689,718 |
4.60% Senior Notes due August 10, 2024 | ||
Debt Instrument [Line Items] | ||
Senior notes | 150,000 | 150,000 |
4.55% Senior Notes due April 15, 2026 | ||
Debt Instrument [Line Items] | ||
Senior notes | 243,623 | |
4.30% Senior Notes due August 1, 2032 | ||
Debt Instrument [Line Items] | ||
Senior notes | 200,000 | 200,000 |
1.56% Series A Senior Note due August 23, 2031 | ||
Debt Instrument [Line Items] | ||
Senior notes | 39,962 | 39,226 |
1.90% Series B Senior Notes due August 23, 2034 | ||
Debt Instrument [Line Items] | ||
Senior notes | 59,887 | 58,786 |
Other Debt | ||
Debt Instrument [Line Items] | ||
Debt | $ 402 | $ 528 |
Debt and Receivables Securiti_4
Debt and Receivables Securitization - Summary of Long-term Debt and Short-term Borrowings Outstanding (Parenthetical) (Detail) | 6 Months Ended | 12 Months Ended |
Nov. 30, 2023 | May 31, 2023 | |
4.60% Senior Notes due August 10, 2024 | ||
Debt Instrument [Line Items] | ||
Debt, interest rate | 4.60% | 4.60% |
Debt, maturity date | Aug. 10, 2024 | Aug. 10, 2024 |
4.55% Senior Notes due April 15, 2026 | ||
Debt Instrument [Line Items] | ||
Debt, interest rate | 4.55% | 4.55% |
Debt, maturity date | Apr. 15, 2026 | Apr. 15, 2026 |
4.30% Senior Notes due August 1, 2032 | ||
Debt Instrument [Line Items] | ||
Debt, interest rate | 4.30% | 4.30% |
Debt, maturity date | Aug. 01, 2032 | Aug. 01, 2032 |
1.56% Series A Senior Note due August 23, 2031 | ||
Debt Instrument [Line Items] | ||
Debt, interest rate | 1.56% | 1.56% |
Debt, maturity date | Aug. 23, 2031 | Aug. 23, 2031 |
1.90% Series B Senior Notes due August 23, 2034 | ||
Debt Instrument [Line Items] | ||
Debt, interest rate | 1.90% | 1.90% |
Debt, maturity date | Aug. 23, 2034 | Aug. 23, 2034 |
Debt and Receivables Securiti_5
Debt and Receivables Securitization - Maturities on Long-term Debt and Short-term Borrowings (Detail) $ in Thousands | Nov. 30, 2023 USD ($) | |
Debt Disclosure [Abstract] | ||
2024 | $ 150,269 | |
2025 | 175,133 | [1] |
Thereafter | 299,849 | |
Total | $ 625,251 | |
[1] Includes $ 175,000 associated with the Worthington Steel Credit Facility (as defined below). Subsequent to the Separation on December 1, 2023, we have no remaining obligation. See the “Other Financing Arrangements” section below for additional information. |
Debt and Receivables Securiti_6
Debt and Receivables Securitization - Maturities on Long-term Debt and Short-term Borrowings (Parenthetical) (Detail) - USD ($) | Dec. 01, 2023 | Nov. 30, 2023 |
Debt Instrument [Line Items] | ||
Borrowings outstanding | $ 0 | |
Worthington Steel Credit Facility | ||
Debt Instrument [Line Items] | ||
Borrowings outstanding | $ 175,000,000 | |
Remaining borrowing capacity | $ 0 |
Debt and Receivables Securiti_7
Debt and Receivables Securitization - Additional Information (Detail) - USD ($) | 6 Months Ended | ||||||||
Sep. 27, 2023 | Sep. 26, 2023 | Jul. 28, 2023 | Apr. 15, 2014 | Nov. 30, 2023 | Dec. 01, 2023 | Jun. 29, 2023 | May 31, 2023 | May 19, 2022 | |
Debt And Receivables Securitization [Line Items] | |||||||||
Long-term debt | $ 625,251,000 | ||||||||
Non-cash loss recognised | (1,534,000) | ||||||||
Borrowings outstanding | 0 | ||||||||
2026 Notes | |||||||||
Debt And Receivables Securitization [Line Items] | |||||||||
Principal amount | $ 243,623,000 | $ 250,000,000 | 6,377,000 | ||||||
Debt, interest rate | 4.55% | ||||||||
Debt, maturity date | Apr. 15, 2026 | ||||||||
Long-term debt | $ 243,623,000 | ||||||||
Non-cash loss recognised | $ 1,534,000 | ||||||||
Unsecured Revolving Credit Facility | |||||||||
Debt And Receivables Securitization [Line Items] | |||||||||
Maximum borrowing capacity | $ 500,000,000 | $ 500,000,000 | |||||||
Maturity date | Sep. 27, 2028 | Aug. 20, 2026 | |||||||
Line of credit facility, description | We maintain a $500,000 unsecured revolving credit facility (the “Credit Facility”) with a group of lenders. On September 27, 2023, we amended and restated the Credit Facility, extending the final maturity from August 20, 2026 to September 27, 2028 while keeping in place the $500,000 aggregate commitments under the Credit Facility in anticipation of the Separation. 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 Simple SOFR 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 | ||||||||
Early termination, other similar fees and penalties paid | $ 0 | ||||||||
Worthington Steel Credit Facility | |||||||||
Debt And Receivables Securitization [Line Items] | |||||||||
Maximum borrowing capacity | $ 550,000,000 | ||||||||
Debt maturity period | 5 years | ||||||||
Borrowings outstanding | $ 175,000,000 | ||||||||
Remaining borrowing capacity | $ 0 |
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, 2023 | Aug. 31, 2023 | Nov. 30, 2022 | Aug. 31, 2022 | Nov. 30, 2023 | Nov. 30, 2022 | |
Components Of Other Comprehensive Income Loss [Abstract] | ||||||
Foreign currency translation, before tax | $ 843 | $ 550 | $ 2,170 | $ (8,970) | ||
Foreign currency translation, tax | 54 | 308 | 172 | (273) | ||
Foreign currency translation, net of tax | 897 | 858 | 2,342 | (9,243) | ||
Pension liability adjustment, before tax | 15 | 3,740 | ||||
Pension liability adjustment, tax | (97) | (3) | (883) | |||
Pension liability adjustment | (82) | (3) | 2,857 | |||
Cash flow hedges, before tax | 17,390 | (5,665) | 8,578 | (22,762) | ||
Cash flow hedges, tax | (3,841) | 1,665 | (1,879) | 5,462 | ||
Cash flow hedges, net of tax | 13,549 | (4,000) | 6,699 | (17,300) | ||
Other comprehensive income (loss), before tax | 18,233 | (5,100) | 10,748 | (27,992) | ||
Other comprehensive income (loss), tax | (3,787) | 1,876 | (1,710) | 4,306 | ||
Other comprehensive income (loss) | $ 14,446 | $ (5,408) | $ (3,224) | $ (20,462) | $ 9,038 | $ (23,686) |
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, 2023 | Aug. 31, 2023 | Nov. 30, 2022 | Aug. 31, 2022 | Nov. 30, 2023 | Nov. 30, 2022 | |
Balance | $ 1,901,916 | $ 1,821,628 | $ 1,646,972 | $ 1,613,962 | $ 1,821,628 | $ 1,613,962 |
Net earnings | 28,167 | 99,703 | 19,505 | 65,244 | 127,870 | 84,749 |
Other comprehensive (loss) income | 14,446 | (5,408) | (3,224) | (20,462) | 9,038 | (23,686) |
Common shares issued, net of withholding tax | (9,207) | (5,130) | (649) | (3,466) | ||
Common shares in non-qualified plans | 195 | 130 | 298 | 136 | ||
Stock-based compensation | 4,511 | 8,995 | 3,620 | 6,976 | ||
Cash dividends declared | (16,061) | (16,081) | (15,470) | (15,418) | ||
Dividends to noncontrolling interests | (1,921) | (11,760) | ||||
Balance | 1,923,967 | 1,901,916 | 1,639,292 | 1,646,972 | 1,923,967 | 1,639,292 |
Additional Paid-in Capital | ||||||
Balance | 294,794 | 290,799 | 277,085 | 273,439 | 290,799 | 273,439 |
Common shares issued, net of withholding tax | (9,207) | (5,130) | (649) | (3,466) | ||
Common shares in non-qualified plans | 195 | 130 | 298 | 136 | ||
Stock-based compensation | 4,511 | 8,995 | 3,620 | 6,976 | ||
Balance | 290,293 | 294,794 | 280,354 | 277,085 | 290,293 | 280,354 |
Accumulated Other Comprehensive Income (Loss), Net of Tax | ||||||
Balance | (28,587) | (23,179) | (43,312) | (22,850) | (23,179) | (22,850) |
Other comprehensive (loss) income | 14,446 | (5,408) | (3,224) | (20,462) | ||
Balance | (14,141) | (28,587) | (46,536) | (43,312) | (14,141) | (46,536) |
Retained Earnings | ||||||
Balance | 1,508,416 | 1,428,391 | 1,278,827 | 1,230,163 | 1,428,391 | 1,230,163 |
Net earnings | 24,302 | 96,106 | 16,218 | 64,082 | ||
Cash dividends declared | (16,061) | (16,081) | (15,470) | (15,418) | ||
Balance | 1,516,657 | 1,508,416 | 1,279,575 | 1,278,827 | 1,516,657 | 1,279,575 |
Parent | ||||||
Balance | 1,774,623 | 1,696,011 | 1,512,600 | 1,480,752 | 1,696,011 | 1,480,752 |
Net earnings | 24,302 | 96,106 | 16,218 | 64,082 | ||
Other comprehensive (loss) income | 14,446 | (5,408) | (3,224) | (20,462) | ||
Common shares issued, net of withholding tax | (9,207) | (5,130) | (649) | (3,466) | ||
Common shares in non-qualified plans | 195 | 130 | 298 | 136 | ||
Stock-based compensation | 4,511 | 8,995 | 3,620 | 6,976 | ||
Cash dividends declared | (16,061) | (16,081) | (15,470) | (15,418) | ||
Balance | 1,792,809 | 1,774,623 | 1,513,393 | 1,512,600 | 1,792,809 | 1,513,393 |
Noncontrolling Interest | ||||||
Balance | 127,293 | 125,617 | 134,372 | 133,210 | 125,617 | 133,210 |
Net earnings | 3,865 | 3,597 | 3,287 | 1,162 | ||
Dividends to noncontrolling interests | (1,921) | (11,760) | ||||
Balance | $ 131,158 | $ 127,293 | $ 125,899 | $ 134,372 | $ 131,158 | $ 125,899 |
Changes in Equity - Summary o_2
Changes in Equity - Summary of Changes in Accumulated OCI (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Nov. 30, 2023 | Nov. 30, 2022 | Nov. 30, 2023 | Nov. 30, 2022 | |||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||||
Balance | $ 1,901,916 | $ 1,646,972 | $ 1,821,628 | $ 1,613,962 | ||
Income tax effect | (3,787) | 1,876 | (1,710) | 4,306 | ||
Balance | 1,923,967 | 1,639,292 | 1,923,967 | 1,639,292 | ||
Foreign Currency Translation | ||||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||||
Balance | (22,123) | (15,310) | ||||
Other comprehensive income (loss) before reclassifications | 2,170 | (8,970) | ||||
Income tax effect | 172 | (273) | ||||
Balance | (19,781) | (24,553) | (19,781) | (24,553) | ||
Pension Liability Adjustment | ||||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||||
Balance | (1,730) | (6,244) | ||||
Other comprehensive income (loss) before reclassifications | (1,034) | |||||
Reclassification adjustments to net earnings | [1],[2] | 4,774 | ||||
Income tax effect | (3) | (883) | ||||
Balance | (1,733) | (3,387) | (1,733) | (3,387) | ||
Cash Flow Hedges | ||||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||||
Balance | 674 | (1,296) | ||||
Other comprehensive income (loss) before reclassifications | 12,947 | (36,041) | ||||
Reclassification adjustments to net earnings | [1] | (4,369) | 13,279 | [2] | ||
Income tax effect | (1,879) | 5,462 | ||||
Balance | 7,373 | (18,596) | 7,373 | (18,596) | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax | ||||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||||
Balance | (28,587) | (43,312) | (23,179) | (22,850) | ||
Other comprehensive income (loss) before reclassifications | 15,117 | (46,045) | ||||
Reclassification adjustments to net earnings | [1] | (4,369) | 18,053 | [2] | ||
Income tax effect | (1,710) | 4,306 | ||||
Balance | $ (14,141) | $ (46,536) | $ (14,141) | $ (46,536) | ||
[1] Cash flow hedges – See the disclosure in “ Note Q – Derivative Financial Instruments and Hedging Activities;” and Pension liability adjustment – Reflects a non-cash settlement charge of $ 4,774 recognized in connection with a pension lift-out transaction completed in August 2022 for The Gerstenslager Company Bargaining Unit Employees’ Pension Plan. |
Changes in Equity - Summary o_3
Changes in Equity - Summary of Changes in Accumulated OCI (Parenthetical) (Detail) $ in Thousands | 6 Months Ended |
Nov. 30, 2023 USD ($) | |
Gerstenslager Company | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Defined benefit plan, benefit obligation, non-cash settlement charge | $ 4,774 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Nov. 30, 2023 | Nov. 30, 2022 | Nov. 30, 2023 | Nov. 30, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Pre-tax stock-based compensation expense | $ 6,175 | $ 4,547 | $ 10,691 | $ 8,783 |
Non-Qualified Stock Options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Non-qualified stock options, granted | 54,000 | |||
Par value of common stock | $ 0 | $ 0 | ||
Non-qualified stock option, per share weighted average price | 69.47 | |||
Non-qualified stock option, fair value, per share price | $ 25.95 | |||
Pre-tax stock-based compensation, period of recognition | 3 years | |||
Pre-tax stock-based compensation expense | $ 1,401 | |||
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 | $ 11,640 | |||
Restricted common shares, granted | 176,000 | |||
Restricted common shares, fair value per share | $ 65.97 | |||
Performance Shares | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Pre-tax stock-based compensation expense | $ 3,235 | |||
Restricted common shares, granted | 47,000 | |||
Pre-tax stock-based compensation, period of recognition | 3 years |
Stock-Based Compensation - Assu
Stock-Based Compensation - Assumptions To Value of Non-qualified Stock Options (Detail) - Non-Qualified Stock Options | 6 Months Ended |
Nov. 30, 2023 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Dividend yield | 2.39% |
Expected volatility | 43% |
Risk-free interest rate | 4.05% |
Expected term (years) | 6 years |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) | 3 Months Ended | |
Nov. 30, 2023 | Nov. 30, 2022 | |
Income Tax Disclosure [Abstract] | ||
Estimated annual effective income tax rate | 23.40% | 23.70% |
Earnings Per Share - Computatio
Earnings Per Share - Computation of Basic and Diluted Earnings Per Common Share Attributable to Controlling Interest (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Nov. 30, 2023 | Nov. 30, 2022 | Nov. 30, 2023 | Nov. 30, 2022 | |
Numerator (basic & diluted): | ||||
Net earnings attributable to controlling interest - income available to common shareholders | $ 24,302 | $ 16,218 | $ 120,409 | $ 80,300 |
Denominator: | ||||
Denominator for basic earnings per common share attributable to controlling interest - weighted average common shares | 49,186 | 48,558 | 49,013 | 48,518 |
Effect of dilutive securities | 856 | 772 | 1,089 | 775 |
Denominator for diluted earnings per common share attributable to controlling interest - adjusted weighted average common shares | 50,042 | 49,330 | 50,102 | 49,293 |
Basic earnings per common share attributable to controlling interest | $ 0.49 | $ 0.33 | $ 2.46 | $ 1.66 |
Diluted earnings per common share attributable to controlling interest | $ 0.49 | $ 0.33 | $ 2.4 | $ 1.63 |
Earnings Per Share - Additional
Earnings Per Share - Additional Information (Detail) - shares shares in Thousands | 3 Months Ended | 6 Months Ended | ||
Nov. 30, 2023 | Nov. 30, 2022 | Nov. 30, 2023 | Nov. 30, 2022 | |
Earnings Per Share [Abstract] | ||||
Shares excluded from computation of diluted earnings per share | 58 | 138 | 46 | 127 |
Segment Operations - Additional
Segment Operations - Additional Information (Detail) | 6 Months Ended |
Nov. 30, 2023 Segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 4 |
Segment Operations - Financial
Segment Operations - Financial Information for Reportable Segments (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||||||||
Nov. 30, 2023 | Aug. 31, 2023 | Nov. 30, 2022 | Aug. 31, 2022 | Nov. 30, 2023 | Nov. 30, 2022 | May 31, 2023 | |||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | $ 1,086,918 | $ 1,175,541 | $ 2,280,174 | $ 2,584,206 | |||||||
Impairment of long-lived assets | $ 1,401 | $ 312 | 1,401 | 312 | |||||||
Restructuring and other expense (income), net | 6 | (4,282) | 6 | (5,382) | |||||||
Separation costs | 21,952 | 9,246 | 27,987 | 9,246 | |||||||
Miscellaneous income (expense), net | 1,020 | 1,405 | 2,031 | (3,681) | |||||||
Loss on extinguishment of debt | 1,534 | ||||||||||
Equity income | 42,446 | 36,857 | 96,827 | 68,569 | |||||||
Adjusted EBIT | 35,365 | 23,636 | 163,845 | 108,378 | |||||||
Total assets | 3,584,137 | 3,584,137 | $ 3,650,918 | ||||||||
Steel Processing | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 788,655 | 841,947 | 1,669,993 | 1,880,827 | |||||||
Impairment of long-lived assets | 1,401 | 312 | |||||||||
Restructuring and other expense (income), net | (4,282) | (4,205) | |||||||||
Miscellaneous income (expense), net | 306 | 850 | 1,018 | 1,035 | |||||||
Equity income | 3,778 | 1,906 | 12,735 | 3,676 | |||||||
Adjusted EBIT | 6,762 | [1] | (17,249) | [2] | 84,762 | [3] | 17,663 | [4] | |||
Total assets | 1,834,226 | 1,834,226 | 1,758,981 | ||||||||
Consumer Products | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 147,738 | 153,795 | 297,151 | 342,497 | |||||||
Miscellaneous income (expense), net | 12 | (47) | 43 | (82) | |||||||
Adjusted EBIT | 9,510 | [1] | 13,473 | [2] | 18,502 | [3] | 34,406 | [4] | |||
Total assets | 622,304 | 622,304 | 615,430 | ||||||||
Building Products | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 122,954 | 141,671 | 256,822 | 291,994 | |||||||
Miscellaneous income (expense), net | 235 | 76 | 292 | 299 | |||||||
Equity income | 35,177 | 35,107 | 80,219 | 78,973 | |||||||
Adjusted EBIT | 40,284 | [1] | 41,224 | [2] | 94,300 | [3] | 93,959 | [4] | |||
Total assets | 611,771 | 611,771 | 635,650 | ||||||||
Sustainable Energy Solutions | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 27,537 | 38,128 | 56,174 | 68,888 | |||||||
Miscellaneous income (expense), net | 557 | 142 | 838 | 56 | |||||||
Adjusted EBIT | (2,617) | [1] | 1,143 | [2] | (7,339) | [3] | (250) | [4] | |||
Total assets | 103,448 | 103,448 | 129,872 | ||||||||
Other | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 34 | 34 | |||||||||
Restructuring and other expense (income), net | 6 | 6 | (1,177) | ||||||||
Separation costs | 21,952 | 9,246 | 27,987 | 9,246 | |||||||
Miscellaneous income (expense), net | (90) | 384 | (160) | (4,989) | |||||||
Loss on extinguishment of debt | (1,534) | ||||||||||
Equity income | 3,491 | (156) | 3,873 | (14,080) | |||||||
Adjusted EBIT | (1,090) | [1] | (3,291) | [2] | (959) | [3] | 1,854 | [4] | |||
Total assets | 412,388 | 412,388 | $ 510,985 | ||||||||
Consolidated | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Loss on extinguishment of debt | (1,534) | ||||||||||
Adjusted EBIT | $ 52,849 | [1] | $ 35,300 | [2] | $ 189,266 | [3] | $ 147,632 | [4] | |||
[1] Excludes the following items in addition to impairment and restructuring activity: • Direct and incremental costs associated with the Separation as discussed in “Note A – Basis of Presentation”; and • Our share of the pre-tax gain realized by Workhorse in connection with the sale of the joint venture’s operations in Brazil of $ 2,780 ; Excludes the following items in addition to impairment and restructuring activity: • Direct and incremental costs associated with the Separation as discussed in “Note A – Basis of Presentation”; • Incremental compensation expense of $ 525 within Consumer Products related to the earnout for the acquisition of Level5 Tools, LLC (“Level5”); and • Noncontrolling interest portion of impairment of long-lived assets of $ 1,850 within Steel Processing. Excludes the following in addition to impairment and restructuring activity: • Direct and incremental costs associated with the Separation as discussed in “Note A – Basis of Presentation”; • The pre-tax loss on extinguishment of debt resulting from the redemption of the 2026 Notes, in full, on July 28, 2023; and • Noncontrolling interest portion of impairment of long-lived assets of $ 519 within Steel Processing. Excludes the following in addition to impairment and restructuring activity: • Direct and incremental costs associated with the Separation as discussed in “Note A – Basis of Presentation.” • A non-cash settlement charge of $ 4,774 in miscellaneous income (expense), net within Other related to the pension lift-out transaction associated with the Gerstenslager Company Bargaining Unit Employees’ Pension Plan; • A loss of $ 15,759 within equity income related to the August 31, 2022, sale of our 50 % noncontrolling interest in ArtiFlex; • Incremental compensation expense of $ 1,050 within Consumer Products related to the Level5 earnout agreement; and • Noncontrolling interest portion of the restructuring gain within Steel processing of $ 1,734 within Steel Processing. |
Segment Operations - Financia_2
Segment Operations - Financial Information for Reportable Segments (Parenthetical) (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Aug. 03, 2022 | Nov. 30, 2023 | Nov. 30, 2022 | Nov. 30, 2023 | Nov. 30, 2022 | Aug. 31, 2022 | |
Segment Reporting Information [Line Items] | ||||||
Restructuring (charges) gains | $ 1,850 | $ 519 | $ 1,734 | |||
Non-cash settlement charge | 4,774 | |||||
Loss on sale of equity investments | (15,759) | |||||
Incremental expenses of Earnout | $ 525 | $ 1,050 | ||||
ArtiFlex | ||||||
Segment Reporting Information [Line Items] | ||||||
Loss on sale of equity investments | $ (15,759) | |||||
Noncontrolling equity investment | 50% | 50% | 50% | |||
Workhorse | ||||||
Segment Reporting Information [Line Items] | ||||||
Noncontrolling equity investment | 20% | 20% | ||||
Workhorse | Brazil | ||||||
Segment Reporting Information [Line Items] | ||||||
Gain on sale of joint venture's operations | $ 2,780 |
Acquisitions - Additional Infor
Acquisitions - Additional Information (Details) - USD ($) $ in Thousands | Nov. 16, 2023 | Jun. 02, 2022 | Nov. 30, 2023 | May 31, 2023 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 416,857 | $ 414,820 | ||
Level5 Tools, LLC | ||||
Business Acquisition [Line Items] | ||||
Cash purchase price | $ 57,603 | |||
Purchase price | 59,472 | |||
Property, plant and equipment | 273 | |||
Goodwill | 15,947 | |||
Earnout payment | 2,000 | |||
Potential earn out payment | 25,000 | |||
Level5 Tools, LLC | Earnout Agreement | ||||
Business Acquisition [Line Items] | ||||
Purchase price | 59,321 | |||
Earnout payment | 2,000 | |||
Level5 Tools, LLC | Preliminary Valuation | ||||
Business Acquisition [Line Items] | ||||
Cash purchase price | 57,603 | |||
Purchase price | 59,321 | |||
Property, plant and equipment | 273 | |||
Goodwill | 15,947 | |||
Earnout payment | $ 2,000 | |||
Tempel Steel Europe GmbH | ||||
Business Acquisition [Line Items] | ||||
Purchase price | $ 21,013 | |||
Pension liability | 929 | |||
Property, plant and equipment | 12,282 | |||
Net working capital | 9,069 | |||
Goodwill | $ 591 |
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 |
Acquired indefinite lived intangible assets | 33,580 |
Trade Name | |
Business Acquisition [Line Items] | |
Acquired indefinite lived intangible assets | $ 13,500 |
Customer Relationships | |
Business Acquisition [Line Items] | |
Useful Life (Years) | 10 years |
Acquired indefinite lived intangible assets | $ 13,300 |
Technological Know How | |
Business Acquisition [Line Items] | |
Useful Life (Years) | 20 years |
Acquired indefinite lived intangible assets | $ 6,500 |
Non Compete Agreement | |
Business Acquisition [Line Items] | |
Useful Life (Years) | 3 years |
Acquired indefinite lived intangible assets | $ 280 |
Acquisitions - Schedule of Cons
Acquisitions - Schedule of Consideration Transferred and the Preliminary Fair Value Assigned to Assets Acquired and Liabilities Assumed (Detail) - USD ($) $ in Thousands | Jun. 02, 2022 | Nov. 30, 2023 | May 31, 2023 |
Business Acquisition [Line Items] | |||
Goodwill | $ 416,857 | $ 414,820 | |
Level5 Tools, LLC | |||
Business Acquisition [Line Items] | |||
Cash and cash equivalents | $ 1,515 | ||
Accounts receivable | 2,860 | ||
Inventories | 9,161 | ||
Prepaid expenses | 64 | ||
Property, plant and equipment | 273 | ||
Intangible assets | 33,580 | ||
Operating lease assets | 377 | ||
Total identifiable assets | 47,830 | ||
Accounts payable | (3,175) | ||
Accrued expenses | (753) | ||
Current operating lease liabilities | (111) | ||
Noncurrent operating lease liabilities | (266) | ||
Net identifiable assets | 43,525 | ||
Goodwill | 15,947 | ||
Total purchase price | 59,472 | ||
Less: Fair value of earnout | (2,000) | ||
Plus: Net working capital deficit | 131 | ||
Cash purchase price | 57,603 | ||
Level5 Tools, LLC | Preliminary Valuation | |||
Business Acquisition [Line Items] | |||
Cash and cash equivalents | 1,515 | ||
Accounts receivable | 2,860 | ||
Inventories | 9,161 | ||
Prepaid expenses | 64 | ||
Property, plant and equipment | 273 | ||
Intangible assets | 33,580 | ||
Operating lease assets | 377 | ||
Total identifiable assets | 47,830 | ||
Accounts payable | (3,175) | ||
Accrued expenses | (904) | ||
Current operating lease liabilities | (111) | ||
Noncurrent operating lease liabilities | (266) | ||
Net identifiable assets | 43,374 | ||
Goodwill | 15,947 | ||
Total purchase price | 59,321 | ||
Less: Fair value of earnout | (2,000) | ||
Plus: Net working capital deficit | 282 | ||
Cash purchase price | 57,603 | ||
Level5 Tools, LLC | Measurement Period Adjustments | |||
Business Acquisition [Line Items] | |||
Accrued expenses | 151 | ||
Net identifiable assets | 151 | ||
Total purchase price | 151 | ||
Plus: Net working capital deficit | $ (151) |
Derivative Financial Instrume_3
Derivative Financial Instruments and Hedging Activities - Schedule of Fair Value of Derivative Instruments (Detail) - USD ($) $ in Thousands | Nov. 30, 2023 | May 31, 2023 |
Derivative [Line Items] | ||
Asset Derivatives at Fair Value | $ 15,021 | $ 2,610 |
Liability Derivatives at Fair Value | 6,391 | 15,800 |
Derivatives Designated As Hedging Instruments | ||
Derivative [Line Items] | ||
Asset Derivatives at Fair Value | 12,545 | |
Liability Derivatives at Fair Value | 3,743 | 7,161 |
Derivatives Designated As Hedging Instruments | Commodity Contracts | ||
Derivative [Line Items] | ||
Asset Derivatives at Fair Value | 12,545 | 71 |
Liability Derivatives at Fair Value | 3,743 | 7,128 |
Derivatives Designated As Hedging Instruments | Commodity Contracts | Accounts Payable | ||
Derivative [Line Items] | ||
Liability Derivatives at Fair Value | 3,743 | 6,749 |
Derivatives Designated As Hedging Instruments | Commodity Contracts | Receivables | ||
Derivative [Line Items] | ||
Asset Derivatives at Fair Value | 12,498 | 20 |
Derivatives Designated As Hedging Instruments | Commodity Contracts | Other Assets | ||
Derivative [Line Items] | ||
Asset Derivatives at Fair Value | 47 | 51 |
Derivatives Designated As Hedging Instruments | Commodity Contracts | Other Liabilities | ||
Derivative [Line Items] | ||
Liability Derivatives at Fair Value | 379 | |
Derivatives Designated As Hedging Instruments | Foreign Currency Exchange Contracts | ||
Derivative [Line Items] | ||
Asset Derivatives at Fair Value | 71 | |
Liability Derivatives at Fair Value | 33 | |
Derivatives Designated As Hedging Instruments | Foreign Currency Exchange Contracts | Accounts Payable | ||
Derivative [Line Items] | ||
Liability Derivatives at Fair Value | 33 | |
Derivatives Not Designated As Hedging Instruments | Commodity Contracts | ||
Derivative [Line Items] | ||
Asset Derivatives at Fair Value | 2,476 | 2,539 |
Liability Derivatives at Fair Value | 2,648 | 8,639 |
Derivatives Not Designated As Hedging Instruments | Commodity Contracts | Accounts Payable | ||
Derivative [Line Items] | ||
Liability Derivatives at Fair Value | 2,609 | 8,604 |
Derivatives Not Designated As Hedging Instruments | Commodity Contracts | Receivables | ||
Derivative [Line Items] | ||
Asset Derivatives at Fair Value | 2,476 | 2,539 |
Derivatives Not Designated As Hedging Instruments | Commodity Contracts | Other Liabilities | ||
Derivative [Line Items] | ||
Liability Derivatives at Fair Value | $ 39 | $ 35 |
Derivative Financial Instrume_4
Derivative Financial Instruments and Hedging Activities - Additional Information (Detail) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Nov. 30, 2023 | May 31, 2023 | |
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 | $ 5,150 | $ 7,576 |
Gains in accumulated other comprehensive income expected to be reclassified into net earnings | (7,678) | |
Gain in accumulated other comprehensive income expected to be reclassified into net earnings, tax | $ 1,703 |
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, 2023 | Nov. 30, 2022 | Nov. 30, 2023 | Nov. 30, 2022 | |
Derivative [Line Items] | ||||
Notional Amount | $ 1,459 | $ 3,814 | $ 395 | $ 2,143 |
Commodity Contracts | Derivatives Not Designated As Hedging Instruments | ||||
Derivative [Line Items] | ||||
Notional Amount | $ 15,509 | |||
Commodity Contracts | Minimum | Derivatives Not Designated As Hedging Instruments | ||||
Derivative [Line Items] | ||||
Maturity Date | Sep. 30, 2023 | |||
Commodity Contracts | Maximum | Derivatives Not Designated As Hedging Instruments | ||||
Derivative [Line Items] | ||||
Maturity Date | Dec. 31, 2024 | |||
Cash Flow Hedges | Commodity Contracts | ||||
Derivative [Line Items] | ||||
Notional Amount | $ 62,825 | $ 62,825 | ||
Cash Flow Hedges | Commodity Contracts | Minimum | ||||
Derivative [Line Items] | ||||
Maturity Date | Sep. 30, 2023 | |||
Cash Flow Hedges | Commodity Contracts | Maximum | ||||
Derivative [Line Items] | ||||
Maturity Date | Dec. 31, 2024 |
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, 2023 | Nov. 30, 2022 | Nov. 30, 2023 | Nov. 30, 2022 | |
Derivative [Line Items] | ||||
Gain (Loss) Recognized in OCI | $ (14,985) | $ (19,265) | $ (12,947) | $ (36,041) |
Gain (Loss) Reclassified from AOCI into Net Earnings | (2,405) | (13,602) | 4,369 | (13,279) |
Commodity Contracts | ||||
Derivative [Line Items] | ||||
Gain (Loss) Recognized in OCI | 15,019 | (19,641) | (12,958) | (36,099) |
Gain (Loss) Reclassified from AOCI into Net Earnings | (2,360) | (13,648) | 4,970 | (13,192) |
Interest Rate Contract | ||||
Derivative [Line Items] | ||||
Gain (Loss) Reclassified from AOCI into Net Earnings | 52 | (7) | (641) | (13) |
Interest Rate Contracts | ||||
Derivative [Line Items] | ||||
Gain (Loss) Reclassified from AOCI into Net Earnings | 84 | |||
Foreign Currency Exchange Contracts | ||||
Derivative [Line Items] | ||||
Gain (Loss) Recognized in OCI | (34) | 376 | (11) | 58 |
Gain (Loss) Reclassified from AOCI into Net Earnings | $ (97) | $ 53 | $ (44) | $ (74) |
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, 2023 | Nov. 30, 2022 | Nov. 30, 2023 | Nov. 30, 2022 | |
Derivative [Line Items] | ||||
Gain (Loss) Recognized in Earnings | $ 1,459 | $ 3,814 | $ 395 | $ 2,143 |
Commodity Contracts | Cost of Sales | ||||
Derivative [Line Items] | ||||
Gain (Loss) Recognized in Earnings | $ 1,459 | 3,861 | $ 395 | 2,284 |
Foreign Currency Exchange Contracts | Miscellaneous Income, Net | ||||
Derivative [Line Items] | ||||
Gain (Loss) Recognized in Earnings | $ (47) | $ (141) |
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, 2023 | May 31, 2023 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets | $ 15,021 | $ 2,610 | ||
Liabilities | 6,391 | 15,800 | ||
Derivative Financial Instruments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets | 6,391 | [1] | 2,610 | [2] |
Liabilities | 15,021 | [1] | 15,800 | [2] |
Fair Value, Inputs, Level 2 | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets | 15,021 | 2,610 | ||
Liabilities | 6,391 | 15,800 | ||
Fair Value, Inputs, Level 2 | Derivative Financial Instruments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets | 6,391 | [1] | 2,610 | [2] |
Liabilities | $ 15,021 | [1] | $ 15,800 | [2] |
[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. 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, 2023 | May 31, 2023 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets, Fair Value Disclosure | $ 0 | $ 2,693,000 | |
Fair Value, Inputs, Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets, Fair Value Disclosure | 2,693,000 | ||
Long Lived Assets Held and Used | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets, Fair Value Disclosure | [1] | 70,000 | |
Long Lived Assets Held and Used | Fair Value, Inputs, Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets, Fair Value Disclosure | [1] | 70,000 | |
Long Lived Assets Held for Sale | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets, Fair Value Disclosure | [2] | 2,623,000 | |
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 | [2] | $ 2,623,000 | |
[1] Comprised of certain assets associated with a capital project at our Building Products facility in Jefferson, Ohio which were written down to their estimated salvage value of $ 70 . Comprised of the following: (a) idled equipment at the manufacturing facility in Taylor, Michigan; and (b) the net assets of our former toll processing facility in Cleveland, Ohio. |
Fair Value - Assets Measured _2
Fair Value - Assets Measured at Fair Value on Non-Recurring Basis (Parenthetical) (Detail) - USD ($) $ in Thousands | Aug. 31, 2023 | May 31, 2023 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Estimated salvage value | $ 150 | |
Capital Project | Building Products Facility | Jefferson | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Estimated salvage value | $ 70 |
Fair Value - Additional Informa
Fair Value - Additional Information (Detail) - Long-term Debt - USD ($) $ in Thousands | Nov. 30, 2023 | May 31, 2023 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt at fair value including current maturities | $ 391,947 | $ 639,948 |
Long-term debt at carrying amount including current maturities | $ 448,818 | $ 689,982 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Detail) - USD ($) | Dec. 06, 2023 | Dec. 01, 2023 | Nov. 30, 2023 | Sep. 27, 2023 |
Unsecured Revolving Credit Facility | ||||
Subsequent Event [Line Items] | ||||
Maximum borrowing capacity | $ 500,000,000 | $ 500,000,000 | ||
Subsequent Event [Member] | ||||
Subsequent Event [Line Items] | ||||
Stock split description | As part of the Distribution, each Worthington Enterprises stockholder of record as of the Record Date received one common share of Worthington Steel for every one common share of Worthington Enterprises held as of the Record Date. | |||
Number of common shares received in separation | 1 | |||
Cash distribution of credit facility in connection with separation | $ 150,000,000 | |||
Maximum borrowing capacity | $ 150,000,000 | |||
Debt instrument, maturity date | senior unsecured notes that were set to mature in August 2024 |