Cover Page
Cover Page - shares | 3 Months Ended | |
Nov. 30, 2021 | Jan. 07, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Nov. 30, 2021 | |
Document Transition Report | false | |
Entity File Number | 1-4304 | |
Entity Registrant Name | COMMERCIAL METALS COMPANY | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 75-0725338 | |
Entity Address, Address Line One | 6565 N. MacArthur Blvd. | |
Entity Address, City or Town | Irving | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 75039 | |
City Area Code | (214) | |
Local Phone Number | 689-4300 | |
Title of 12(b) Security | Common Stock, $0.01 par value | |
Trading Symbol | CMC | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 121,481,234 | |
Entity Central Index Key | 0000022444 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2022 | |
Current Fiscal Year End Date | --08-31 | |
Document Fiscal Period Focus | Q1 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED) - USD ($) $ in Thousands | 3 Months Ended | ||
Nov. 30, 2021 | Nov. 30, 2020 | ||
Income Statement [Abstract] | |||
Net sales | $ 1,981,801 | $ 1,391,803 | |
Costs and expenses: | |||
Cost of goods sold | 1,586,410 | 1,174,819 | |
Selling, general and administrative expenses | 122,595 | 113,627 | |
Interest expense | 11,035 | 14,259 | |
Asset impairments | 0 | 3,594 | |
Total costs and expenses | 1,720,040 | 1,306,299 | |
Earnings from continuing operations before income taxes | 261,761 | 85,504 | |
Income taxes | 28,872 | 21,593 | |
Earnings from continuing operations | 232,889 | 63,911 | |
Earnings from discontinued operations before income taxes | 0 | 250 | |
Income taxes | 0 | 68 | |
Earnings from discontinued operations | 0 | 182 | |
Net earnings | $ 232,889 | $ 64,093 | |
Basic earnings per share: | |||
Earnings from continuing operations (in USD per share) | [1] | $ 1.92 | $ 0.53 |
Earnings from discontinued operations (in USD per share) | [1] | 0 | 0 |
Net earnings (in USD per share) | [1] | 1.92 | 0.54 |
Diluted earnings per share: | |||
Earnings from continuing operations (in USD per share) | [1] | 1.90 | 0.53 |
Earnings from discontinued operations (in USD per share) | [1] | 0 | 0 |
Net earnings (in USD per share) | [1] | $ 1.90 | $ 0.53 |
Average basic shares outstanding (shares) | 121,129,679 | 119,762,706 | |
Average diluted shares outstanding (shares) | 122,797,738 | 121,128,044 | |
[1] | *Earnings Per Share ("EPS") is calculated independently for each component and may not sum to Net EPS due to rounding. |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (UNAUDITED) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Statement of Comprehensive Income [Abstract] | ||
Net earnings | $ 232,889 | $ 64,093 |
Other comprehensive income (loss), net of income taxes: | ||
Foreign currency translation adjustment after reclassification | (39,688) | (8,388) |
Derivatives: | ||
Unrealized holding gain | 22,254 | 1,164 |
Reclassification for realized gain | (3,069) | (54) |
Net unrealized gain on derivatives | 19,185 | 1,110 |
Defined benefit plans loss after amortization of prior service costs and net actuarial losses | (6) | (13) |
Net other comprehensive income (loss) | (20,509) | (7,291) |
Comprehensive income | $ 212,380 | $ 56,802 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($) $ in Thousands | Nov. 30, 2021 | Aug. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 415,055 | $ 497,745 |
Accounts receivable (less allowance for doubtful accounts of $5,550 and $5,553) | 1,095,612 | 1,105,580 |
Inventories, net | 1,071,759 | 935,387 |
Prepaid and other current assets | 178,867 | 173,033 |
Assets held for sale | 25,083 | 25,083 |
Total current assets | 2,786,376 | 2,736,828 |
Property, plant and equipment, net | 1,587,442 | 1,566,123 |
Goodwill | 65,852 | 66,137 |
Other noncurrent assets | 285,588 | 269,583 |
Total assets | 4,725,258 | 4,638,671 |
Current liabilities: | ||
Accounts payable | 424,919 | 450,723 |
Accrued expenses and other payables | 410,305 | 475,384 |
Current maturities of long-term debt and short-term borrowings | 56,896 | 54,366 |
Total current liabilities | 892,120 | 980,473 |
Deferred income taxes | 104,193 | 112,067 |
Other noncurrent liabilities | 234,955 | 235,607 |
Long-term debt | 1,007,801 | 1,015,415 |
Total liabilities | 2,239,069 | 2,343,562 |
Commitments and contingencies (Note 13) | ||
Stockholders' equity: | ||
Common stock, par value $0.01 per share; authorized 200,000,000 shares; issued 129,060,664 shares; outstanding 121,479,939 and 120,586,589 shares | 1,290 | 1,290 |
Additional paid-in capital | 357,413 | 368,064 |
Accumulated other comprehensive loss | (105,329) | (84,820) |
Retained earnings | 2,378,789 | 2,162,925 |
Less treasury stock 7,580,725 and 8,474,075 shares at cost | (146,206) | (152,582) |
Stockholders' equity | 2,485,957 | 2,294,877 |
Stockholders' equity attributable to noncontrolling interests | 232 | 232 |
Total stockholders' equity | 2,486,189 | 2,295,109 |
Total liabilities and stockholders' equity | $ 4,725,258 | $ 4,638,671 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical) - USD ($) $ in Thousands | Nov. 30, 2021 | Aug. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 5,550 | $ 5,553 |
Common stock, par value (in USD per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares issued | 129,060,664 | 129,060,664 |
Common stock, shares outstanding | 121,479,939 | 120,586,589 |
Treasury stock, shares | 7,580,725 | 8,474,075 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Cash flows from (used by) operating activities: | ||
Net earnings | $ 232,889 | $ 64,093 |
Adjustments to reconcile net earnings to cash flows from (used by) operating activities: | ||
Depreciation and amortization | 41,226 | 41,799 |
Stock-based compensation | 9,619 | 9,062 |
Deferred income taxes and other long-term taxes | (5,099) | 11,720 |
Other | (583) | (39) |
Asset impairments | 0 | 3,594 |
Amortization of acquired unfavorable contract backlog | 0 | (1,523) |
Changes in operating assets and liabilities | (252,273) | (140,794) |
Net cash flows from (used by) operating activities | 25,779 | (12,088) |
Cash flows from (used by) investing activities: | ||
Capital expenditures | (70,150) | (37,201) |
Proceeds from the sale of property, plant and equipment and other | 1,418 | 743 |
Net cash flows used by investing activities | (68,732) | (36,458) |
Cash flows from (used by) financing activities: | ||
Proceeds from accounts receivable facilities | 150,664 | 4,487 |
Repayments under accounts receivable facilities | (144,706) | (4,487) |
Dividends | (17,025) | (14,406) |
Stock issued under incentive and purchase plans, net of forfeitures | (16,371) | (10,341) |
Repayments of long-term debt | (6,556) | (3,823) |
Treasury stock acquired | (5,311) | 0 |
Net cash flows used by financing activities | (39,305) | (28,570) |
Effect of exchange rate changes on cash | (550) | (365) |
Decrease in cash, restricted cash and cash equivalents | (82,808) | (77,481) |
Cash, restricted cash and cash equivalents at beginning of period | 418,321 | 467,483 |
Cash, restricted cash and cash equivalents at end of period | $ 418,321 | $ 467,483 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Supplemental information: | ||
Cash paid for income taxes | $ 15,296 | $ 4,743 |
Cash paid for interest | 8,794 | 18,691 |
Noncash activities: | ||
Liabilities related to additions of property, plant and equipment | 45,788 | 20,246 |
Cash and cash equivalents | 415,055 | 465,162 |
Restricted Cash | 3,266 | 2,321 |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Total | $ 418,321 | $ 467,483 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (UNAUDITED) - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Treasury Stock | Noncontrolling Interests |
Beginning balance at Aug. 31, 2020 | $ 1,889,413 | $ 1,290 | $ 358,912 | $ (103,764) | $ 1,807,826 | $ (175,063) | $ 212 |
Beginning balance, shares at Aug. 31, 2020 | 129,060,664 | ||||||
Beginning balance, treasury stock, shares at Aug. 31, 2020 | (9,839,759) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net earnings | 64,093 | 64,093 | |||||
Other comprehensive loss | (7,291) | ||||||
Dividends | (14,406) | (14,406) | |||||
Issuance of stock under incentive and purchase plans, net of forfeitures | (10,341) | (23,527) | $ 13,186 | ||||
Issuance of stock under incentive and purchase plans, net of forfeitures, shares | 847,116 | ||||||
Stock-based compensation | 8,011 | 8,011 | |||||
Reclassification of share-based liability awards | 5,420 | 5,420 | |||||
Ending balance at Nov. 30, 2020 | 1,934,899 | $ 1,290 | 348,816 | (111,055) | 1,857,513 | $ (161,877) | 212 |
Ending balance, shares at Nov. 30, 2020 | 129,060,664 | ||||||
Ending balance, treasury stock, shares at Nov. 30, 2020 | (8,992,643) | ||||||
Beginning balance at Aug. 31, 2021 | $ 2,295,109 | $ 1,290 | 368,064 | (84,820) | 2,162,925 | $ (152,582) | 232 |
Beginning balance, shares at Aug. 31, 2021 | 129,060,664 | 129,060,664 | |||||
Beginning balance, treasury stock, shares at Aug. 31, 2021 | (8,474,075) | (8,474,075) | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net earnings | $ 232,889 | 232,889 | |||||
Other comprehensive loss | (20,509) | ||||||
Dividends | $ (17,025) | (17,025) | |||||
Treasury stock acquired, shares | (159,500) | (159,500) | |||||
Treasury stock acquired | $ (5,311) | $ (5,311) | |||||
Issuance of stock under incentive and purchase plans, net of forfeitures | (16,371) | (28,058) | $ 11,687 | ||||
Issuance of stock under incentive and purchase plans, net of forfeitures, shares | 1,052,850 | ||||||
Stock-based compensation | 8,316 | 8,316 | |||||
Reclassification of share-based liability awards | 9,091 | 9,091 | |||||
Ending balance at Nov. 30, 2021 | $ 2,486,189 | $ 1,290 | $ 357,413 | $ (105,329) | $ 2,378,789 | $ (146,206) | $ 232 |
Ending balance, shares at Nov. 30, 2021 | 129,060,664 | 129,060,664 | |||||
Ending balance, treasury stock, shares at Nov. 30, 2021 | (7,580,725) | (7,580,725) |
CONDENSED CONSOLIDATED STATEM_6
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (UNAUDITED) (Parenthetical) - $ / shares | 3 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Statement of Stockholders' Equity [Abstract] | ||
Cash dividends per share (in USD per share) | $ 0.14 | $ 0.12 |
ACCOUNTING POLICIES
ACCOUNTING POLICIES | 3 Months Ended |
Nov. 30, 2021 | |
Accounting Policies [Abstract] | |
Accounting policies | NOTE 1. ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") on a basis consistent with that used in the Annual Report on Form 10-K for the year ended August 31, 2021 (the "2021 Form 10-K") filed by Commercial Metals Company ("CMC," and together with its consolidated subsidiaries, the "Company") with the Securities and Exchange Commission (the "SEC") and include all normal recurring adjustments necessary to present fairly the condensed consolidated balance sheets and the condensed consolidated statements of earnings, comprehensive income, cash flows and stockholders' equity for the periods indicated. These notes should be read in conjunction with the consolidated financial statements and notes included in the 2021 Form 10-K. The results of operations for the three month period are not necessarily indicative of the results to be expected for the full fiscal year. Any reference in this Form 10-Q to the "corresponding period" relates to the relevant three month period ended November 30, 2020. Any reference in this Form 10-Q to a year refers to the fiscal year ended August 31st of that year, unless otherwise noted. Recently Issued Accounting Pronouncements In October 2021, the Financial Accounting Standards Board issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. ASU 2021-08 requires that an acquirer recognize and measure contract assets and liabilities acquired in a business combination in accordance with ASU 2014-09, Revenue from Contracts with Customers (Topic 606). This standard is effective for annual periods beginning after December 15, 2022, including interim periods therein, with early adoption permitted. The guidance will be applied prospectively to acquisitions occurring on or after the effective date. The Company will continue to evaluate the impact of this guidance, which will depend on the contract assets and liabilities acquired in future business combinations. |
CHANGES IN BUSINESS
CHANGES IN BUSINESS | 3 Months Ended |
Nov. 30, 2021 | |
Business Combinations [Abstract] | |
Changes in Business | NOTE 2. CHANGES IN BUSINESS Facility Closure and Disposition In October 2019, the Company closed the melting operations at its Rancho Cucamonga facility, which is part of the North America segment, and in August 2020, the Company announced plans to sell the facility. Additionally, in September 2021, the Company ceased operations at a rebar fabrication facility adjacent to the Rancho Cucamonga facility. Due to these closures, the Company recorded $8.0 million of expenses in the three months ended November 30, 2020 related to asset impairments, severance, pension curtailment, environmental obligations and vendor agreement terminations. Expenses recorded in the three months ended November 30, 2021 were immaterial. The closures did not meet the criteria for discontinued operations. As of August 31, 2021, the associated assets of the Rancho Cucamonga facility and the adjacent rebar fabrication facility, comprised of property, plant and equipment, net, met the criteria for classification as held for sale. As such, the Company classified $24.9 million within assets held for sale in the Company's condensed consolidated balance sheets as of November 30, 2021 and August 31, 2021. |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | 3 Months Ended |
Nov. 30, 2021 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated other comprehensive income (loss) | NOTE 3. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The following tables reflect the changes in accumulated other comprehensive income (loss) ("AOCI"): Three Months Ended November 30, 2021 (in thousands) Foreign Currency Translation Unrealized Gain (Loss) on Derivatives Defined Benefit Obligation Total AOCI Balance, September 1, 2021 $ (105,680) $ 21,781 $ (921) $ (84,820) Other comprehensive income (loss) before reclassifications (39,688) 27,474 (8) (12,222) Reclassification for gain (1) — (3,789) — (3,789) Income tax (expense) benefit — (4,500) 2 (4,498) Net other comprehensive income (loss) (39,688) 19,185 (6) (20,509) Balance, November 30, 2021 $ (145,368) $ 40,966 $ (927) $ (105,329) Three Months Ended November 30, 2020 (in thousands) Foreign Currency Translation Unrealized Gain (Loss) on Derivatives Defined Benefit Obligation Total AOCI Balance, September 1, 2020 $ (87,933) $ (11,334) $ (4,497) $ (103,764) Other comprehensive income (loss) before reclassifications (8,388) 1,437 (20) (6,971) Reclassification for gain (1) — (67) — (67) Income tax (expense) benefit — (260) 7 (253) Net other comprehensive income (loss) (8,388) 1,110 (13) (7,291) Balance, November 30, 2020 $ (96,321) $ (10,224) $ (4,510) $ (111,055) _________________ (1) Reclassifications for gains on derivatives included in net earnings are recorded in cost of goods sold in the condensed consolidated statements of earnings. |
REVENUE RECOGNITION
REVENUE RECOGNITION | 3 Months Ended |
Nov. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | NOTE 4. REVENUE RECOGNITION Each fabricated product contract sold by the North America segment represents a single performance obligation. Revenue from contracts where the Company provides fabricated product and installation services is recognized over time using an input measure, and these contracts represented 9% and 14% of net sales in the North America segment in the three months ended November 30, 2021 and 2020, respectively. Revenue from contracts where the Company does not provide installation services is recognized over time using an output measure, and these contracts represented 9% of net sales in the North America segment in the three months ended November 30, 2021 and 2020. Remaining net sales in the North America segment were recognized at a point in time concurrent with the transfer of control, or as amounts were billed to the customer under an available practical expedient. The following table provides information about assets and liabilities from contracts with customers: (in thousands) November 30, 2021 August 31, 2021 Contract assets (included in accounts receivable) $ 61,888 $ 64,168 Contract liabilities (included in accrued expenses and other payables) 29,066 23,948 The amount of revenue reclassified from August 31, 2021 contract liabilities during the three months ended November 30, 2021 was approximately $10.3 million. Remaining Performance Obligations Remaining performance obligations represent the transaction price of fabricated product contracts where revenue is recognized using an input or output measure for which work has not yet been performed. As of November 30, 2021, $862.7 million was allocated to remaining performance obligations in the North America segment related to those contracts. |
INVENTORIES, NET
INVENTORIES, NET | 3 Months Ended |
Nov. 30, 2021 | |
Inventory Disclosure [Abstract] | |
Inventories, net | NOTE 5. INVENTORIES, NET The majority of the Company's inventories are in the form of semi-finished and finished goods. Under the Company’s business model, products are sold to external customers in various stages, from semi-finished billets through fabricated steel, leading these categories to be combined. As such, at November 30, 2021 and August 31, 2021, work in process inventories were immaterial. At November 30, 2021 and August 31, 2021, the Company's raw materials inventories were $329.9 million and $286.1 million, respectively. |
GOODWILL AND OTHER INTANGIBLES
GOODWILL AND OTHER INTANGIBLES | 3 Months Ended |
Nov. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and other intangibles | NOTE 6. GOODWILL AND OTHER INTANGIBLES Goodwill by reportable segment at November 30, 2021 is detailed in the following table: (in thousands) North America Europe Consolidated Goodwill, gross* $ 71,941 $ 4,094 $ 76,035 Accumulated impairment* (10,036) (147) (10,183) Goodwill, net* $ 61,905 $ 3,947 $ 65,852 _________________ * The change in balance from August 31, 2021 was immaterial. The total gross carrying amounts of the Company's intangible assets subject to amortization were $21.3 million and $21.7 million, and the total net carrying amounts were $9.3 million and $10.1 million at November 30, 2021 and August 31, 2021, respectively. These assets were included in other noncurrent assets on the Company's condensed consolidated balance sheets. Intangible amortization expense from continuing operations related to such intangible assets was immaterial for the three months ended November 30, 2021 and 2020. Excluding goodwill, the Company did not have any significant intangible assets with indefinite lives at November 30, 2021. |
LEASES
LEASES | 3 Months Ended |
Nov. 30, 2021 | |
Leases [Abstract] | |
Operating Leases | NOTE 7. LEASES The following table presents the components of the total leased assets and lease liabilities and their classification in the Company's condensed consolidated balance sheets: (in thousands) Classification in Condensed Consolidated Balance Sheets November 30, 2021 August 31, 2021 Assets: Operating assets Other noncurrent assets $ 118,855 $ 112,202 Finance assets Property, plant and equipment, net 53,221 55,308 Total leased assets $ 172,076 $ 167,510 Liabilities: Operating lease liabilities: Current Accrued expenses and other payables $ 28,327 $ 26,433 Long-term Other noncurrent liabilities 97,891 93,409 Total operating lease liabilities 126,218 119,842 Finance lease liabilities: Current Current maturities of long-term debt and short-term borrowings 15,808 16,040 Long-term Long-term debt 33,128 36,104 Total finance lease liabilities 48,936 52,144 Total lease liabilities $ 175,154 $ 171,986 The components of lease expense were as follows: Three Months Ended November 30, (in thousands) 2021 2020 Operating lease expense $ 8,584 $ 8,722 Finance lease expense: Amortization of assets 3,235 3,239 Interest on lease liabilities 514 555 Total finance lease expense 3,749 3,794 Variable and short-term lease expense 5,162 4,962 Total lease expense $ 17,495 $ 17,478 The weighted average remaining lease term and discount rate for operating and finance leases are presented in the following table: November 30, 2021 August 31, 2021 Weighted average remaining lease term (years) Operating leases 6.0 6.2 Finance leases 3.4 3.6 Weighted average discount rate Operating leases 4.275 % 4.451 % Finance leases 4.045 % 4.079 % Cash flow and other information related to leases is included in the following table: Three Months Ended November 30, (in thousands) 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflows from operating leases $ 8,749 $ 9,047 Operating cash outflows from finance leases 519 560 Financing cash outflows from finance leases 4,199 3,795 Right of use assets obtained in exchange for lease obligations: Operating leases $ 15,912 $ 12,267 Finance leases 1,002 6,300 Future maturities of lease liabilities at November 30, 2021 are presented in the following table: (in thousands) Operating Leases Finance Leases Year 1 $ 33,528 $ 17,480 Year 2 28,441 15,170 Year 3 22,763 12,163 Year 4 17,842 5,719 Year 5 12,984 1,362 Thereafter 29,033 512 Total lease payments 144,591 52,406 Less imputed interest 18,373 3,470 Present value of lease liabilities $ 126,218 $ 48,936 |
Finance Leases | NOTE 7. LEASES The following table presents the components of the total leased assets and lease liabilities and their classification in the Company's condensed consolidated balance sheets: (in thousands) Classification in Condensed Consolidated Balance Sheets November 30, 2021 August 31, 2021 Assets: Operating assets Other noncurrent assets $ 118,855 $ 112,202 Finance assets Property, plant and equipment, net 53,221 55,308 Total leased assets $ 172,076 $ 167,510 Liabilities: Operating lease liabilities: Current Accrued expenses and other payables $ 28,327 $ 26,433 Long-term Other noncurrent liabilities 97,891 93,409 Total operating lease liabilities 126,218 119,842 Finance lease liabilities: Current Current maturities of long-term debt and short-term borrowings 15,808 16,040 Long-term Long-term debt 33,128 36,104 Total finance lease liabilities 48,936 52,144 Total lease liabilities $ 175,154 $ 171,986 The components of lease expense were as follows: Three Months Ended November 30, (in thousands) 2021 2020 Operating lease expense $ 8,584 $ 8,722 Finance lease expense: Amortization of assets 3,235 3,239 Interest on lease liabilities 514 555 Total finance lease expense 3,749 3,794 Variable and short-term lease expense 5,162 4,962 Total lease expense $ 17,495 $ 17,478 The weighted average remaining lease term and discount rate for operating and finance leases are presented in the following table: November 30, 2021 August 31, 2021 Weighted average remaining lease term (years) Operating leases 6.0 6.2 Finance leases 3.4 3.6 Weighted average discount rate Operating leases 4.275 % 4.451 % Finance leases 4.045 % 4.079 % Cash flow and other information related to leases is included in the following table: Three Months Ended November 30, (in thousands) 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflows from operating leases $ 8,749 $ 9,047 Operating cash outflows from finance leases 519 560 Financing cash outflows from finance leases 4,199 3,795 Right of use assets obtained in exchange for lease obligations: Operating leases $ 15,912 $ 12,267 Finance leases 1,002 6,300 Future maturities of lease liabilities at November 30, 2021 are presented in the following table: (in thousands) Operating Leases Finance Leases Year 1 $ 33,528 $ 17,480 Year 2 28,441 15,170 Year 3 22,763 12,163 Year 4 17,842 5,719 Year 5 12,984 1,362 Thereafter 29,033 512 Total lease payments 144,591 52,406 Less imputed interest 18,373 3,470 Present value of lease liabilities $ 126,218 $ 48,936 |
CREDIT ARRANGEMENTS
CREDIT ARRANGEMENTS | 3 Months Ended |
Nov. 30, 2021 | |
Debt Disclosure [Abstract] | |
Credit arrangements | NOTE 8. CREDIT ARRANGEMENTS Long-term debt was as follows: (in thousands) Weighted Average Interest Rate as of November 30, 2021 November 30, 2021 August 31, 2021 2031 Notes 3.875% $ 300,000 $ 300,000 2027 Notes 5.375% 300,000 300,000 2023 Notes 4.875% 330,000 330,000 Poland Term Loan 3.080% 44,055 49,726 Short-term borrowings 1.161% 29,992 26,560 Other 5.100% 19,492 19,492 Finance leases 48,936 52,144 Total debt 1,072,475 1,077,922 Less debt issuance costs 7,778 8,141 Total amounts outstanding 1,064,697 1,069,781 Less current maturities of long-term debt and short-term borrowings 56,896 54,366 Long-term debt $ 1,007,801 $ 1,015,415 The Company had no amounts drawn under its $400.0 million revolving credit facility (the "Revolver") at November 30, 2021 or August 31, 2021. The availability under the Revolver was reduced by outstanding stand-by letters of credit totaling $3.0 million at November 30, 2021 and August 31, 2021. The Company has a Term Loan facility (the "Poland Term Loan") through its subsidiary, CMC Poland Sp. z.o.o. ("CMCP"). At November 30, 2021, PLN 181.0 million, or $44.1 million, was outstanding, compared to the maximum amount available under the facility, PLN 190.5 million, or $49.7 million, which was outstanding as of August 31, 2021. The Company also has credit facilities in Poland through its subsidiary, CMCP. At November 30, 2021, CMCP's credit facilities totaled PLN 300.0 million, or $73.0 million. There were no amounts outstanding under these facilities as of November 30, 2021 or August 31, 2021. The available balance of these credit facilities was reduced by outstanding stand-by letters of credit, guarantees, and/or other financial assurance instruments, which totaled $0.9 million and $5.7 million at November 30, 2021 and August 31, 2021, respectively. The Company's debt agreements require compliance with certain non-financial and financial covenants, including an interest coverage ratio and a debt to capitalization ratio. At November 30, 2021, the Company was in compliance with all covenants contained in its debt agreements. Accounts Receivable Facilities The Company had no advance payments outstanding under its U.S. trade accounts receivable facility at November 30, 2021 or August 31, 2021. |
DERIVATIVES
DERIVATIVES | 3 Months Ended |
Nov. 30, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives | NOTE 9. DERIVATIVES The Company's global operations and product lines expose it to risks from fluctuations in metal commodity prices, foreign currency exchange rates, interest rates and natural gas, electricity and other energy prices. One objective of the Company's risk management program is to mitigate these risks using derivative instruments. The Company enters into (i) metal commodity futures and forward contracts to mitigate the risk of unanticipated changes in net earnings due to price volatility in these commodities, (ii) foreign currency forward contracts that match the expected settlements for purchases and sales denominated in foreign currencies and (iii) natural gas and electricity commodity derivatives to mitigate the risk related to price volatility of these commodities. At November 30, 2021, the notional values of the Company's foreign currency and commodity contract commitments were $320.2 million and $217.5 million, respectively. At August 31, 2021, the notional values of the Company's foreign currency and commodity contract commitments were $389.5 million and $213.4 million, respectively. The following table provides information regarding the Company's commodity contract commitments at November 30, 2021: Commodity Long/Short Total Aluminum Long 1,875 MT Copper Long 612 MT Copper Short 9,095 MT Electricity Long 1,817,000 MW(h) Natural Gas Long 1,631,700 MMBtu _________________ MT = Metric Ton MW(h) = Megawatt hour MMBtu = Metric Million British thermal unit The Company designates only those contracts which closely match the terms of the underlying transaction as hedges for accounting purposes. Certain foreign currency and commodity contracts were not designated as hedges for accounting purposes, although management believes they are essential economic hedges. Foreign currency derivatives not designated as hedging instruments resulted in a loss, before income taxes, of $8.0 million and $1.9 million in the three months ended November 30, 2021 and 2020 , respectively. Commodity derivatives not designated as hedging instrument s resulted in a gain, before income taxes, of $2.7 million in the three months ended November 30, 2021, and a loss , before income taxes, of $5.6 million in the three months ended November 30, 2020, primarily recorded in cost of goods sold within the condensed consolidated statements of earnings. Commodity derivatives accounted for as cash flow hedging instruments resulted in net gains of $22.2 million and $1.2 million in the three months ended November 30, 2021 and 2020 , respectively, recognized in the condensed consolidated statements of comprehensive income. The Company's natural gas and electricity commodity derivatives accounted for as cash flow hedging instruments have maturities extending to November 2024 and December 2030, respective ly. Included in the AOCI balance as of November 30, 2021 was an estimated net gain of $3.9 million from cash flow hedging instruments that is expected to be reclassified into earnings within the next twelve months. See Note 10, Fair Value, for the fair value of the Company's derivative instruments recorded in the condensed consol |
FAIR VALUE
FAIR VALUE | 3 Months Ended |
Nov. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair value | NOTE 10. FAIR VALUE The Company has established a fair value hierarchy which prioritizes the inputs to the valuation techniques used to measure fair value into three levels. These levels are determined based on the lowest level input that is significant to the fair value measurement. Levels within the hierarchy are defined within the Nature of Operations and Summary of Significant Accounting Policies footnote in the 2021 Form 10-K. The following tables summarize information regarding the Company's financial assets and financial liabilities that were measured at fair value on a recurring basis: Fair Value Measurements at Reporting Date Using (in thousands) November 30, 2021 Quoted Prices in Significant Other Significant Assets: Investment deposit accounts (1) $ 361,387 $ 361,387 $ — $ — Commodity derivative assets (2) 50,253 2,361 — 47,892 Foreign exchange derivative assets (2) 1,207 — 1,207 — Liabilities: Commodity derivative liabilities (2) 375 375 — — Foreign exchange derivative liabilities (2) 4,072 — 4,072 — Fair Value Measurements at Reporting Date Using (in thousands) August 31, 2021 Quoted Prices in Significant Other Significant Assets: Investment deposit accounts (1) $ 441,297 $ 441,297 $ — $ — Commodity derivative assets (2) 27,323 910 — 26,413 Foreign exchange derivative assets (2) 2,537 — 2,537 — Liabilities: Commodity derivative liabilities (2) 1,352 1,352 — — Foreign exchange derivative liabilities (2) 1,880 — 1,880 — _________________ (1) Investment deposit accounts are short-term in nature, and the value is determined by principal plus interest. The investment portfolio mix can change each period based on the Company's assessment of investment options. (2) Derivative assets and liabilities classified as Level 1 are commodity futures contracts valued based on quoted market prices in the London Metal Exchange or New York Mercantile Exchange. Amounts in Level 2 are based on broker quotes in the over-the-counter market. Derivatives classified as Level 3 are described below. Further discussion regarding the Company's use of derivative instruments is included in Note 9, Derivatives. The fair value estimate of the Level 3 commodity derivative is based on an internally developed discounted cash flow model primarily utilizing unobservable inputs in which there is little or no market data. The Company forecasts future energy rates using a range of historical prices ("floating rate"). The floating rate is the only significant unobservable input used in the Company's discounted cash flow model. The following table summarizes the floating rate used to measure the fair value of the commodity derivative at November 30, 2021 and 2020: Floating rate (PLN) November 30, Low High Average 2021 252.79 540.39 348.99 2020 151.66 247.56 203.96 Below is a reconciliation of the beginning and ending balances of the Level 3 commodity derivative recognized in the condensed consolidated statements of comprehensive income. The fluctuation in energy rates over time may cause volatility in the fair value estimate and is the primary reason for unrealized gains and losses included in other comprehensive income ("OCI") in the three months ended November 30, 2021 and 2020. (in thousands) Three Months Ended November 30, 2021 Balance, September 1, 2021 $ 26,413 Total gains, realized and unrealized Unrealized holding gain (1) 25,208 Reclassification for gain included in net earnings (2) (3,729) Balance, November 30, 2021 $ 47,892 (in thousands) Three Months Ended November 30, 2020 Balance, September 1, 2020 $ (15,007) Total gains, realized and unrealized Unrealized holding gain (1) 1,393 Balance, November 30, 2020 $ (13,614) ________________ (1) Unrealized holding gains are included in OCI in the condensed consolidated statements of comprehensive income. (2) Gains included in net earnings are recorded in cost of goods sold in the condensed consolidated statements of earnings. There were no material non-recurring fair value remeasurements during the three months ended November 30, 2021 or 2020. The carrying values of the Company's short-term items, including documentary letters of credit and notes payable, approximate fair value. The carrying values and estimated fair values of the Company's financial assets and liabilities that are not required to be measured at fair value on the condensed consolidated balance sheets were as follows: November 30, 2021 August 31, 2021 (in thousands) Fair Value Hierarchy Carrying Value Fair Value Carrying Value Fair Value 2031 Notes (1) Level 2 $ 300,000 $ 297,378 $ 300,000 $ 306,279 2027 Notes (1) Level 2 300,000 309,978 300,000 316,839 2023 Notes (1) Level 2 330,000 341,058 330,000 348,071 Poland Term Loan (2) Level 2 44,055 44,055 49,726 49,726 Short-term borrowings (2) Level 2 29,992 29,992 26,560 26,560 _________________ (1) The fair values of the Notes were determined based on indicated market values. (2) The Poland Term Loan and short-term borrowings contain variable interest rates, and as a result, the carrying values approximate fair value. |
STOCK-BASED COMPENSATION PLANS
STOCK-BASED COMPENSATION PLANS | 3 Months Ended |
Nov. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Stock-based compensation plans | NOTE 11. STOCK-BASED COMPENSATION PLANS The Company's stock-based compensation plans are described in Note 13, Stock-Based Compensation Plans, to the consolidated financial statements in the 2021 Form 10-K. In general, restricted stock units vest ratably over a period of three years. Subject to the achievement of performance targets established by the Compensation Committee of CMC's Board of Directors, performance stock units vest after a period of three years. During the three months ended November 30, 2021 and 2020, the Company granted the following awards under its stock-based compensation plans: November 30, 2021 November 30, 2020 (in thousands, except share and per share data) Shares Granted Weighted Average Grant Date Fair Value Shares Granted Weighted Average Grant Date Fair Value Equity method 1,407 $ 27.77 1,399 $ 20.39 Liability method 261 N/A 324 N/A The Company recorded immaterial mark-to-market adjustments on liability awards for the three months ended November 30, 2021 and 2020. At November 30, 2021, the Company had outstanding 591,483 equivalent shares accounted for under the liability method. The Company expects 561,908 equivalent shares to vest. The following table summarizes total stock-based compensation expense, including fair value remeasurements, which was primarily included in selling, general and administrative expenses on the Company's condensed consolidated statements of earnings: Three Months Ended November 30, (in thousands) 2021 2020 Stock-based compensation expense $ 9,619 $ 9,062 |
STOCKHOLDERS EQUITY AND EARNING
STOCKHOLDERS EQUITY AND EARNINGS PER SHARE | 3 Months Ended |
Nov. 30, 2021 | |
Earnings Per Share [Abstract] | |
Stockholder's equity and earnings per share | NOTE 12. STOCKHOLDERS' EQUITY AND EARNINGS PER SHARE Basic EPS is computed based on the weighted average shares of common stock outstanding during the period. Diluted EPS is computed based on the weighted average shares of common stock plus the effect of dilutive securities outstanding during the period using the treasury stock method. The effect of dilutive securities includes the impact of outstanding stock-based incentive awards and shares purchased by employees through participation in the Company's employee stock purchase plan. The calculations of basic and diluted EPS from continuing operations were as follows: Three Months Ended November 30, (in thousands, except share and per share data) 2021 2020 Earnings from continuing operations $ 232,889 $ 63,911 Average basic shares outstanding 121,129,679 119,762,706 Effect of dilutive securities 1,668,059 1,365,338 Average diluted shares outstanding 122,797,738 121,128,044 Earnings per share from continuing operations: Basic $ 1.92 $ 0.53 Diluted $ 1.90 $ 0.53 Anti-dilutive shares not included above were immaterial for all periods presented. Restricted stock is included in the number of shares of common stock issued and outstanding, but omitted from the basic EPS calculation until the shares vest. In October 2021, CMC's Board of Directors authorized a share repurchase program under which CMC may repurchase up to $350.0 million of shares of common stock. During the three months ended November 30, 2021, the Company repurchased |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Nov. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and contingencies | NOTE 13. COMMITMENTS AND CONTINGENCIES In the ordinary course of conducting its business, the Company becomes involved in litigation, administrative proceedings and governmental investigations, including environmental matters. At November 30, 2021 and August 31, 2021, the amounts accrued for cleanup and remediation costs at certain sites in response to statutes enforced by the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 ("CERCLA") were immaterial. Total accrued environmental liabilities, including CERCLA sites, were $5.2 million and $7.1 million at November 30, 2021 and August 31, 2021, respectively, of which $2.2 million and $2.3 million were classified as other long-term liabilities at November 30, 2021 and August 31, 2021, respectively. These amounts have not been discounted to their present values. Due to evolving remediation technology, changing regulations, possible third-party contributions, the inherent uncertainties of the estimation process and other factors, amounts accrued could vary significantly from amounts paid. |
BUSINESS SEGMENTS
BUSINESS SEGMENTS | 3 Months Ended |
Nov. 30, 2021 | |
Segment Reporting [Abstract] | |
Business segments | NOTE 14. BUSINESS SEGMENTS The Company structures its business into two reportable segments: North America and Europe. See Note 1, Nature of Operations and Summary of Significant Accounting Policies, to the consolidated financial statements in the 2021 Form 10-K for more information about the reportable segments, including the types of products and services from which each reportable segment derives its net sales. Corporate and Other contains earnings or losses on assets and liabilities related to the Company's Benefit Restoration Plan assets and short-term investments, expenses of the Company's corporate headquarters, interest expense related to its long-term debt and intercompany eliminations. The following is a summary of certain financial information from continuing operations by reportable segment and Corporate and Other: Three Months Ended November 30, 2021 (in thousands) North America Europe Corporate and Other Continuing Operations Net sales $ 1,653,622 $ 329,056 $ (877) $ 1,981,801 Adjusted EBITDA 268,524 79,832 (34,334) 314,022 Total assets at November 30, 2021 3,389,890 736,872 598,496 4,725,258 Three Months Ended November 30, 2020 (in thousands) North America Europe Corporate and Other Continuing Operations Net sales $ 1,195,013 $ 194,596 $ 2,194 $ 1,391,803 Adjusted EBITDA 155,634 14,470 (26,471) 143,633 Total assets at August 31, 2021 3,221,465 729,766 687,440 4,638,671 The following table presents a reconciliation of earnings from continuing operations to adjusted EBITDA from continuing operations: Three Months Ended November 30, (in thousands) 2021 2020 Earnings from continuing operations $ 232,889 $ 63,911 Interest expense 11,035 14,259 Income taxes 28,872 21,593 Depreciation and amortization 41,226 41,799 Asset impairments — 3,594 Amortization of acquired unfavorable contract backlog — (1,523) Adjusted EBITDA from continuing operations $ 314,022 $ 143,633 Disaggregation of Revenue The following tables display revenue by reportable segment and Corporate and Other from external customers, disaggregated by major product: Three Months Ended November 30, 2021 (in thousands) North America Europe Corporate and Other Total Major product: Raw materials $ 353,092 $ 6,960 $ — $ 360,052 Steel products 675,042 243,145 — 918,187 Downstream products 514,396 70,072 — 584,468 Other 111,092 8,385 (383) 119,094 Net sales-unaffiliated customers 1,653,622 328,562 (383) 1,981,801 Intersegment net sales, eliminated on consolidation — 494 (494) — Net sales $ 1,653,622 $ 329,056 $ (877) $ 1,981,801 Three Months Ended November 30, 2020 (in thousands) North America Europe Corporate and Other Total Major product: Raw materials $ 210,237 $ 2,830 $ — $ 213,067 Steel products 457,657 151,455 — 609,112 Downstream products 437,029 34,473 — 471,502 Other 90,090 5,427 2,605 98,122 Net sales-unaffiliated customers 1,195,013 194,185 2,605 1,391,803 Intersegment net sales, eliminated on consolidation — 411 (411) — Net sales $ 1,195,013 $ 194,596 $ 2,194 $ 1,391,803 |
SUBSEQUENT EVENT
SUBSEQUENT EVENT | 3 Months Ended |
Nov. 30, 2021 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENT | NOTE 15. SUBSEQUENT EVENT On December 3, 2021, the Company signed a definitive agreement to acquire TAC Acquisition Corp. ("Tensar"), a portfolio company of Castle Harlan Inc.’s fund, Castle Harlan Partners V, L.P., and a leading global provider of engineered solutions for subgrade reinforcement and soil stabilization used in road, infrastructure and commercial construction projects. The transaction is expected to close during the first half of calendar year 2022, and is subject to the satisfaction or waiver of customary closing conditions, including customary regulatory review. Upon closing, the Company will pay a cash purchase price of $550.0 million, subject to customary purchase price adjustments. The transaction is not contingent on any financing arrangements. |
ACCOUNTING POLICIES (Policies)
ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Nov. 30, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") on a basis consistent with that used in the Annual Report on Form 10-K for the year ended August 31, 2021 (the "2021 Form 10-K") filed by Commercial Metals Company ("CMC," and together with its consolidated subsidiaries, the "Company") with the Securities and Exchange Commission (the "SEC") and include all normal recurring adjustments necessary to present fairly the condensed consolidated balance sheets and the condensed consolidated statements of earnings, comprehensive income, cash flows and stockholders' equity for the periods indicated. These notes should be read in conjunction with the consolidated financial statements and notes included in the 2021 Form 10-K. The results of operations for the three month period are not necessarily indicative of the results to be expected for the full fiscal year. Any reference in this Form 10-Q to the "corresponding period" relates to the relevant three month period ended November 30, 2020. Any reference in this Form 10-Q to a year refers to the fiscal year ended August 31st of that year, unless otherwise noted. |
Recently Issued Accounting Pronouncements | In October 2021, the Financial Accounting Standards Board issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. ASU 2021-08 requires that an acquirer recognize and measure contract assets and liabilities acquired in a business combination in accordance with ASU 2014-09, Revenue from Contracts with Customers (Topic 606). This standard is effective for annual periods beginning after December 15, 2022, including interim periods therein, with early adoption permitted. The guidance will be applied prospectively to acquisitions occurring on or after the effective date. The Company will continue to evaluate the impact of this guidance, which will depend on the contract assets and liabilities acquired in future business combinations.In November 2021, the Financial Accounting Standards Board issued ASU 2021-10, Government Assistance (Topic 832): Disclosures by Business Entities About Government Assistance. ASU 2021-10 aims to increase the transparency of government assistance through the disclosure of the types of assistance, an entity's accounting for the assistance and the effect of the assistance on an entity's financial statements. This standard is effective for annual periods beginning after December 15, 2021, with early adoption permitted. The Company will continue to evaluate the impact of this guidance based on government assistance received. |
Fair value measurement | The Company has established a fair value hierarchy which prioritizes the inputs to the valuation techniques used to measure fair value into three levels. These levels are determined based on the lowest level input that is significant to the fair value measurement. Levels within the hierarchy are defined within the Nature of Operations and Summary of Significant Accounting Policies footnote in the 2021 Form 10-K. |
ACCUMULATED OTHER COMPREHENSI_2
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables) | 3 Months Ended |
Nov. 30, 2021 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of accumulated other comprehensive income (loss) | The following tables reflect the changes in accumulated other comprehensive income (loss) ("AOCI"): Three Months Ended November 30, 2021 (in thousands) Foreign Currency Translation Unrealized Gain (Loss) on Derivatives Defined Benefit Obligation Total AOCI Balance, September 1, 2021 $ (105,680) $ 21,781 $ (921) $ (84,820) Other comprehensive income (loss) before reclassifications (39,688) 27,474 (8) (12,222) Reclassification for gain (1) — (3,789) — (3,789) Income tax (expense) benefit — (4,500) 2 (4,498) Net other comprehensive income (loss) (39,688) 19,185 (6) (20,509) Balance, November 30, 2021 $ (145,368) $ 40,966 $ (927) $ (105,329) Three Months Ended November 30, 2020 (in thousands) Foreign Currency Translation Unrealized Gain (Loss) on Derivatives Defined Benefit Obligation Total AOCI Balance, September 1, 2020 $ (87,933) $ (11,334) $ (4,497) $ (103,764) Other comprehensive income (loss) before reclassifications (8,388) 1,437 (20) (6,971) Reclassification for gain (1) — (67) — (67) Income tax (expense) benefit — (260) 7 (253) Net other comprehensive income (loss) (8,388) 1,110 (13) (7,291) Balance, November 30, 2020 $ (96,321) $ (10,224) $ (4,510) $ (111,055) _________________ (1) Reclassifications for gains on derivatives included in net earnings are recorded in cost of goods sold in the condensed consolidated statements of earnings. |
REVENUE RECOGNITION (Tables)
REVENUE RECOGNITION (Tables) | 3 Months Ended |
Nov. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Information avout Assets and Liabilities from Contracts with Customers | The following table provides information about assets and liabilities from contracts with customers: (in thousands) November 30, 2021 August 31, 2021 Contract assets (included in accounts receivable) $ 61,888 $ 64,168 Contract liabilities (included in accrued expenses and other payables) 29,066 23,948 |
GOODWILL AND OTHER INTANGIBLES
GOODWILL AND OTHER INTANGIBLES (Tables) | 3 Months Ended |
Nov. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in the carrying amount of goodwill | Goodwill by reportable segment at November 30, 2021 is detailed in the following table: (in thousands) North America Europe Consolidated Goodwill, gross* $ 71,941 $ 4,094 $ 76,035 Accumulated impairment* (10,036) (147) (10,183) Goodwill, net* $ 61,905 $ 3,947 $ 65,852 _________________ * The change in balance from August 31, 2021 was immaterial. |
LEASES (Tables)
LEASES (Tables) | 3 Months Ended |
Nov. 30, 2021 | |
Leases [Abstract] | |
Schedule of Balance Sheet Components of Leases | The following table presents the components of the total leased assets and lease liabilities and their classification in the Company's condensed consolidated balance sheets: (in thousands) Classification in Condensed Consolidated Balance Sheets November 30, 2021 August 31, 2021 Assets: Operating assets Other noncurrent assets $ 118,855 $ 112,202 Finance assets Property, plant and equipment, net 53,221 55,308 Total leased assets $ 172,076 $ 167,510 Liabilities: Operating lease liabilities: Current Accrued expenses and other payables $ 28,327 $ 26,433 Long-term Other noncurrent liabilities 97,891 93,409 Total operating lease liabilities 126,218 119,842 Finance lease liabilities: Current Current maturities of long-term debt and short-term borrowings 15,808 16,040 Long-term Long-term debt 33,128 36,104 Total finance lease liabilities 48,936 52,144 Total lease liabilities $ 175,154 $ 171,986 |
Lease Cost | The components of lease expense were as follows: Three Months Ended November 30, (in thousands) 2021 2020 Operating lease expense $ 8,584 $ 8,722 Finance lease expense: Amortization of assets 3,235 3,239 Interest on lease liabilities 514 555 Total finance lease expense 3,749 3,794 Variable and short-term lease expense 5,162 4,962 Total lease expense $ 17,495 $ 17,478 The weighted average remaining lease term and discount rate for operating and finance leases are presented in the following table: November 30, 2021 August 31, 2021 Weighted average remaining lease term (years) Operating leases 6.0 6.2 Finance leases 3.4 3.6 Weighted average discount rate Operating leases 4.275 % 4.451 % Finance leases 4.045 % 4.079 % |
Cash Flow and Other Information Related to Leases | Three Months Ended November 30, (in thousands) 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflows from operating leases $ 8,749 $ 9,047 Operating cash outflows from finance leases 519 560 Financing cash outflows from finance leases 4,199 3,795 Right of use assets obtained in exchange for lease obligations: Operating leases $ 15,912 $ 12,267 Finance leases 1,002 6,300 |
Maturity of Operating Lease Liabilities | Future maturities of lease liabilities at November 30, 2021 are presented in the following table: (in thousands) Operating Leases Finance Leases Year 1 $ 33,528 $ 17,480 Year 2 28,441 15,170 Year 3 22,763 12,163 Year 4 17,842 5,719 Year 5 12,984 1,362 Thereafter 29,033 512 Total lease payments 144,591 52,406 Less imputed interest 18,373 3,470 Present value of lease liabilities $ 126,218 $ 48,936 |
Maturity of Finance Lease Liabilities | Future maturities of lease liabilities at November 30, 2021 are presented in the following table: (in thousands) Operating Leases Finance Leases Year 1 $ 33,528 $ 17,480 Year 2 28,441 15,170 Year 3 22,763 12,163 Year 4 17,842 5,719 Year 5 12,984 1,362 Thereafter 29,033 512 Total lease payments 144,591 52,406 Less imputed interest 18,373 3,470 Present value of lease liabilities $ 126,218 $ 48,936 |
CREDIT ARRANGEMENTS (Tables)
CREDIT ARRANGEMENTS (Tables) | 3 Months Ended |
Nov. 30, 2021 | |
Debt Disclosure [Abstract] | |
Long-term debt, including the deferred gain from the termination of the interest rate swaps | Long-term debt was as follows: (in thousands) Weighted Average Interest Rate as of November 30, 2021 November 30, 2021 August 31, 2021 2031 Notes 3.875% $ 300,000 $ 300,000 2027 Notes 5.375% 300,000 300,000 2023 Notes 4.875% 330,000 330,000 Poland Term Loan 3.080% 44,055 49,726 Short-term borrowings 1.161% 29,992 26,560 Other 5.100% 19,492 19,492 Finance leases 48,936 52,144 Total debt 1,072,475 1,077,922 Less debt issuance costs 7,778 8,141 Total amounts outstanding 1,064,697 1,069,781 Less current maturities of long-term debt and short-term borrowings 56,896 54,366 Long-term debt $ 1,007,801 $ 1,015,415 |
DERIVATIVES (Tables)
DERIVATIVES (Tables) | 3 Months Ended |
Nov. 30, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Commodity contract commitments | The following table provides information regarding the Company's commodity contract commitments at November 30, 2021: Commodity Long/Short Total Aluminum Long 1,875 MT Copper Long 612 MT Copper Short 9,095 MT Electricity Long 1,817,000 MW(h) Natural Gas Long 1,631,700 MMBtu _________________ MT = Metric Ton MW(h) = Megawatt hour MMBtu = Metric Million British thermal unit |
FAIR VALUE (Tables)
FAIR VALUE (Tables) | 3 Months Ended |
Nov. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Financial assets and financial liabilities measured at fair value on a recurring basis | The following tables summarize information regarding the Company's financial assets and financial liabilities that were measured at fair value on a recurring basis: Fair Value Measurements at Reporting Date Using (in thousands) November 30, 2021 Quoted Prices in Significant Other Significant Assets: Investment deposit accounts (1) $ 361,387 $ 361,387 $ — $ — Commodity derivative assets (2) 50,253 2,361 — 47,892 Foreign exchange derivative assets (2) 1,207 — 1,207 — Liabilities: Commodity derivative liabilities (2) 375 375 — — Foreign exchange derivative liabilities (2) 4,072 — 4,072 — Fair Value Measurements at Reporting Date Using (in thousands) August 31, 2021 Quoted Prices in Significant Other Significant Assets: Investment deposit accounts (1) $ 441,297 $ 441,297 $ — $ — Commodity derivative assets (2) 27,323 910 — 26,413 Foreign exchange derivative assets (2) 2,537 — 2,537 — Liabilities: Commodity derivative liabilities (2) 1,352 1,352 — — Foreign exchange derivative liabilities (2) 1,880 — 1,880 — _________________ (1) Investment deposit accounts are short-term in nature, and the value is determined by principal plus interest. The investment portfolio mix can change each period based on the Company's assessment of investment options. (2) Derivative assets and liabilities classified as Level 1 are commodity futures contracts valued based on quoted market prices in the London Metal Exchange or New York Mercantile Exchange. Amounts in Level 2 are based on broker quotes in the over-the-counter market. Derivatives classified as Level 3 are described below. Further discussion regarding the Company's use of derivative instruments is included in Note 9, Derivatives. The fair value estimate of the Level 3 commodity derivative is based on an internally developed discounted cash flow model primarily utilizing unobservable inputs in which there is little or no market data. The Company forecasts future energy rates using a range of historical prices ("floating rate"). The floating rate is the only significant unobservable input used in the Company's discounted cash flow model. The following table summarizes the floating rate used to measure the fair value of the commodity derivative at November 30, 2021 and 2020: Floating rate (PLN) November 30, Low High Average 2021 252.79 540.39 348.99 2020 151.66 247.56 203.96 |
Fair value, net derivative asset (liability) measured on recurring basis, unobservable input reconciliation | Below is a reconciliation of the beginning and ending balances of the Level 3 commodity derivative recognized in the condensed consolidated statements of comprehensive income. The fluctuation in energy rates over time may cause volatility in the fair value estimate and is the primary reason for unrealized gains and losses included in other comprehensive income ("OCI") in the three months ended November 30, 2021 and 2020. (in thousands) Three Months Ended November 30, 2021 Balance, September 1, 2021 $ 26,413 Total gains, realized and unrealized Unrealized holding gain (1) 25,208 Reclassification for gain included in net earnings (2) (3,729) Balance, November 30, 2021 $ 47,892 (in thousands) Three Months Ended November 30, 2020 Balance, September 1, 2020 $ (15,007) Total gains, realized and unrealized Unrealized holding gain (1) 1,393 Balance, November 30, 2020 $ (13,614) ________________ (1) Unrealized holding gains are included in OCI in the condensed consolidated statements of comprehensive income. (2) Gains included in net earnings are recorded in cost of goods sold in the condensed consolidated statements of earnings. |
Financial assets and liabilities not required to be measured at fair value | The carrying values and estimated fair values of the Company's financial assets and liabilities that are not required to be measured at fair value on the condensed consolidated balance sheets were as follows: November 30, 2021 August 31, 2021 (in thousands) Fair Value Hierarchy Carrying Value Fair Value Carrying Value Fair Value 2031 Notes (1) Level 2 $ 300,000 $ 297,378 $ 300,000 $ 306,279 2027 Notes (1) Level 2 300,000 309,978 300,000 316,839 2023 Notes (1) Level 2 330,000 341,058 330,000 348,071 Poland Term Loan (2) Level 2 44,055 44,055 49,726 49,726 Short-term borrowings (2) Level 2 29,992 29,992 26,560 26,560 _________________ (1) The fair values of the Notes were determined based on indicated market values. (2) The Poland Term Loan and short-term borrowings contain variable interest rates, and as a result, the carrying values approximate fair value. |
STOCK-BASED COMPENSATION PLANS
STOCK-BASED COMPENSATION PLANS (Tables) | 3 Months Ended |
Nov. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Stock Based Awards Granted | During the three months ended November 30, 2021 and 2020, the Company granted the following awards under its stock-based compensation plans: November 30, 2021 November 30, 2020 (in thousands, except share and per share data) Shares Granted Weighted Average Grant Date Fair Value Shares Granted Weighted Average Grant Date Fair Value Equity method 1,407 $ 27.77 1,399 $ 20.39 Liability method 261 N/A 324 N/A |
Schedule of Stock-based Compensation Expense | The following table summarizes total stock-based compensation expense, including fair value remeasurements, which was primarily included in selling, general and administrative expenses on the Company's condensed consolidated statements of earnings: Three Months Ended November 30, (in thousands) 2021 2020 Stock-based compensation expense $ 9,619 $ 9,062 |
STOCKHOLDERS_ EQUITY AND EARNIN
STOCKHOLDERS’ EQUITY AND EARNINGS PER SHARE (Tables) | 3 Months Ended |
Nov. 30, 2021 | |
Earnings Per Share [Abstract] | |
Calculations of the basic and diluted earnings per share from continuing operations | The calculations of basic and diluted EPS from continuing operations were as follows: Three Months Ended November 30, (in thousands, except share and per share data) 2021 2020 Earnings from continuing operations $ 232,889 $ 63,911 Average basic shares outstanding 121,129,679 119,762,706 Effect of dilutive securities 1,668,059 1,365,338 Average diluted shares outstanding 122,797,738 121,128,044 Earnings per share from continuing operations: Basic $ 1.92 $ 0.53 Diluted $ 1.90 $ 0.53 |
BUSINESS SEGMENTS (Tables)
BUSINESS SEGMENTS (Tables) | 3 Months Ended |
Nov. 30, 2021 | |
Segment Reporting [Abstract] | |
Summary of certain financial information from continuing operations by reportable segment | The following is a summary of certain financial information from continuing operations by reportable segment and Corporate and Other: Three Months Ended November 30, 2021 (in thousands) North America Europe Corporate and Other Continuing Operations Net sales $ 1,653,622 $ 329,056 $ (877) $ 1,981,801 Adjusted EBITDA 268,524 79,832 (34,334) 314,022 Total assets at November 30, 2021 3,389,890 736,872 598,496 4,725,258 Three Months Ended November 30, 2020 (in thousands) North America Europe Corporate and Other Continuing Operations Net sales $ 1,195,013 $ 194,596 $ 2,194 $ 1,391,803 Adjusted EBITDA 155,634 14,470 (26,471) 143,633 Total assets at August 31, 2021 3,221,465 729,766 687,440 4,638,671 |
Reconciliations of earnings from continuing operations to adjusted operating profit | The following table presents a reconciliation of earnings from continuing operations to adjusted EBITDA from continuing operations: Three Months Ended November 30, (in thousands) 2021 2020 Earnings from continuing operations $ 232,889 $ 63,911 Interest expense 11,035 14,259 Income taxes 28,872 21,593 Depreciation and amortization 41,226 41,799 Asset impairments — 3,594 Amortization of acquired unfavorable contract backlog — (1,523) Adjusted EBITDA from continuing operations $ 314,022 $ 143,633 |
Net sales by major product | The following tables display revenue by reportable segment and Corporate and Other from external customers, disaggregated by major product: Three Months Ended November 30, 2021 (in thousands) North America Europe Corporate and Other Total Major product: Raw materials $ 353,092 $ 6,960 $ — $ 360,052 Steel products 675,042 243,145 — 918,187 Downstream products 514,396 70,072 — 584,468 Other 111,092 8,385 (383) 119,094 Net sales-unaffiliated customers 1,653,622 328,562 (383) 1,981,801 Intersegment net sales, eliminated on consolidation — 494 (494) — Net sales $ 1,653,622 $ 329,056 $ (877) $ 1,981,801 Three Months Ended November 30, 2020 (in thousands) North America Europe Corporate and Other Total Major product: Raw materials $ 210,237 $ 2,830 $ — $ 213,067 Steel products 457,657 151,455 — 609,112 Downstream products 437,029 34,473 — 471,502 Other 90,090 5,427 2,605 98,122 Net sales-unaffiliated customers 1,195,013 194,185 2,605 1,391,803 Intersegment net sales, eliminated on consolidation — 411 (411) — Net sales $ 1,195,013 $ 194,596 $ 2,194 $ 1,391,803 |
CHANGES IN BUSINESS (Details)
CHANGES IN BUSINESS (Details) - USD ($) $ in Thousands | Dec. 28, 2021 | Nov. 30, 2021 | Nov. 30, 2020 | Aug. 31, 2021 |
Business Combinations [Abstract] | ||||
Facility closure costs | $ 0 | $ 8,000 | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Assets held for sale | 25,083 | $ 25,083 | ||
Subsequent Event | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Proceeds from sale of assets | $ 313,000 | |||
Rancho Cucamonga Facility and Rebar Fabrication Facility | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Assets held for sale | $ 24,900 | $ 24,900 |
ACCUMULATED OTHER COMPREHENSI_3
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (AOCI by Components) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Beginning balance | $ (84,820) | $ (103,764) |
Other comprehensive income (loss) before reclassifications | (12,222) | (6,971) |
Reclassification for gain | (3,789) | (67) |
Income tax (expense) benefit | (4,498) | (253) |
Net other comprehensive income (loss) | (20,509) | (7,291) |
Ending balance | (105,329) | (111,055) |
Foreign Currency Translation | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Beginning balance | (105,680) | (87,933) |
Other comprehensive income (loss) before reclassifications | (39,688) | (8,388) |
Reclassification for gain | 0 | 0 |
Income tax (expense) benefit | 0 | 0 |
Net other comprehensive income (loss) | (39,688) | (8,388) |
Ending balance | (145,368) | (96,321) |
Unrealized Gain (Loss) on Derivatives | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Beginning balance | 21,781 | (11,334) |
Other comprehensive income (loss) before reclassifications | 27,474 | 1,437 |
Reclassification for gain | (3,789) | (67) |
Income tax (expense) benefit | (4,500) | (260) |
Net other comprehensive income (loss) | 19,185 | 1,110 |
Ending balance | 40,966 | (10,224) |
Defined Benefit Obligation | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Beginning balance | (921) | (4,497) |
Other comprehensive income (loss) before reclassifications | (8) | (20) |
Reclassification for gain | 0 | 0 |
Income tax (expense) benefit | 2 | 7 |
Net other comprehensive income (loss) | (6) | (13) |
Ending balance | $ (927) | $ (4,510) |
REVENUE RECOGNITION - Revenue R
REVENUE RECOGNITION - Revenue Recognition Method (Details) - Americas Fabrication - Recognized over Time | 3 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Fabricated Product and Installation Services | ||
Disaggregation of Revenue [Line Items] | ||
Contract as percent of total segment revenue (percent) | 9.00% | 14.00% |
Fabricated Product without Installation Services | ||
Disaggregation of Revenue [Line Items] | ||
Contract as percent of total segment revenue (percent) | 9.00% | 9.00% |
REVENUE RECOGNITION - Contract
REVENUE RECOGNITION - Contract Assets and Contract Liabilities (Details) - USD ($) $ in Thousands | Nov. 30, 2021 | Aug. 31, 2021 |
Revenue from Contract with Customer [Abstract] | ||
Contract assets (included in other current assets) | $ 61,888 | $ 64,168 |
Contract liabilities (included in accrued expenses and other payables) | $ 29,066 | $ 23,948 |
REVENUE RECOGNITION - Additiona
REVENUE RECOGNITION - Additional Information (Details) $ in Millions | 3 Months Ended |
Nov. 30, 2021USD ($) | |
Revenue from Contract with Customer [Abstract] | |
Revenue reclassified from contract liabilities | $ 10.3 |
Remaining performance obligation | $ 862.7 |
INVENTORIES, NET (Narrative) (D
INVENTORIES, NET (Narrative) (Details) - USD ($) $ in Millions | Nov. 30, 2021 | Aug. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 329.9 | $ 286.1 |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLES (Changes in the Carrying Amount of Goodwill) (Details) - USD ($) $ in Thousands | Nov. 30, 2021 | Aug. 31, 2021 |
Goodwill [Line Items] | ||
Goodwill, gross | $ 76,035 | |
Accumulated impairment losses | (10,183) | |
Goodwill, net | 65,852 | $ 66,137 |
North America | ||
Goodwill [Line Items] | ||
Goodwill, gross | 71,941 | |
Accumulated impairment losses | (10,036) | |
Goodwill, net | 61,905 | |
Europe | ||
Goodwill [Line Items] | ||
Goodwill, gross | 4,094 | |
Accumulated impairment losses | (147) | |
Goodwill, net | $ 3,947 |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLES (Narrative) (Details) - USD ($) $ in Millions | Nov. 30, 2021 | Aug. 31, 2021 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Gross carrying amounts of the intangible assets subject to amortization | $ 21.3 | $ 21.7 |
Net carrying amount of intangible assets subject to amortization | $ 9.3 | $ 10.1 |
LEASES - Balance Sheet Componen
LEASES - Balance Sheet Components (Details) - USD ($) $ in Thousands | Nov. 30, 2021 | Aug. 31, 2021 |
Leased Assets [Abstract] | ||
Operating Lease, Right-of-Use Asset | $ 118,855 | $ 112,202 |
Finance Lease, Right-of-Use Asset, after Accumulated Amortization | 53,221 | 55,308 |
Right-of-Use Asset | 172,076 | 167,510 |
Lessee, Operating Lease, Description [Abstract] | ||
Operating Lease, Liability, Current | $ 28,327 | $ 26,433 |
Operating lease liabilities, Current [Extensible List] | Accrued Liabilities, Current | Accrued Liabilities, Current |
Operating Lease, Liability, Noncurrent | $ 97,891 | $ 93,409 |
Operating lease liabilities, Long-term [Extensible List] | Other Liabilities, Noncurrent | Other Liabilities, Noncurrent |
Operating Lease, Liability, Total | $ 126,218 | $ 119,842 |
Lessee, Finance Lease, Description [Abstract] | ||
Finance Lease, Liability, Current | 15,808 | 16,040 |
Finance Lease, Liability, Noncurrent | 33,128 | 36,104 |
Finance Lease, Liability, Total | 48,936 | 52,144 |
Lease Liability | $ 175,154 | $ 171,986 |
LEASES - Lease Cost (Details)
LEASES - Lease Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Leases [Abstract] | ||
Operating lease expense | $ 8,584 | $ 8,722 |
Finance lease expense: | ||
Amortization of assets | 3,235 | 3,239 |
Interest on lease liabilities | 514 | 555 |
Total finance lease expense | 3,749 | 3,794 |
Variable and short-term lease expense | 5,162 | 4,962 |
Total lease expense | $ 17,495 | $ 17,478 |
LEASES - Weighted Average Lease
LEASES - Weighted Average Lease Terms and Discount Rates (Details) | Nov. 30, 2021 | Aug. 31, 2021 |
Leases [Abstract] | ||
Operating leases, remaining term | 6 years | 6 years 2 months 12 days |
Finance leases, remaining term | 3 years 4 months 24 days | 3 years 7 months 6 days |
Operating leases, weighted average discount rate | 4.275% | 4.451% |
Finance leases, weighted average discount rate | 4.045% | 4.079% |
LEASES - Cash Flow and Other In
LEASES - Cash Flow and Other Information Related to Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash outflows from operating leases | $ 8,749 | $ 9,047 |
Operating cash outflows from finance leases | 519 | 560 |
Financing cash outflows from finance leases | 4,199 | 3,795 |
Right-of-Use Assets Obtained in Exchange for Lease Obligations [Abstract] | ||
Operating leases | 15,912 | 12,267 |
Finance leases | $ 1,002 | $ 6,300 |
LEASES - Maturity of Lease Liab
LEASES - Maturity of Lease Liabilities (Details) - USD ($) $ in Thousands | Nov. 30, 2021 | Aug. 31, 2021 |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | ||
Year 1 | $ 33,528 | |
Year 2 | 28,441 | |
Year 3 | 22,763 | |
Year 4 | 17,842 | |
Year 5 | 12,984 | |
Thereafter | 29,033 | |
Total lease payments | 144,591 | |
Less imputed interest | 18,373 | |
Present value of lease liabilities | 126,218 | $ 119,842 |
Finance Lease, Liability, Payment, Due [Abstract] | ||
Year 1 | 17,480 | |
Year 2 | 15,170 | |
Year 3 | 12,163 | |
Year 4 | 5,719 | |
Year 5 | 1,362 | |
Thereafter | 512 | |
Total lease payments | 52,406 | |
Less imputed interest | 3,470 | |
Present value of lease liabilities | $ 48,936 | $ 52,144 |
CREDIT ARRANGEMENTS (Long-term
CREDIT ARRANGEMENTS (Long-term Debt, Including the Deferred Gain from the Termination of the Interest Rate Swaps) (Details) - USD ($) $ in Thousands | Nov. 30, 2021 | Aug. 31, 2021 |
Debt Instrument [Line Items] | ||
Total debt | $ 1,072,475 | $ 1,077,922 |
Less debt issuance costs | 7,778 | 8,141 |
Total amounts outstanding | 1,064,697 | 1,069,781 |
Less current maturities of long-term debt | 56,896 | 54,366 |
Long-term debt | $ 1,007,801 | 1,015,415 |
2031 Notes | ||
Debt Instrument [Line Items] | ||
Weighted average interest rate | 3.875% | |
Total debt | $ 300,000 | 300,000 |
2031 Notes | Significant Other Observable Inputs (Level 2) | Fair Value | ||
Debt Instrument [Line Items] | ||
Total debt | $ 297,378 | 306,279 |
2027 Notes | ||
Debt Instrument [Line Items] | ||
Weighted average interest rate | 5.375% | |
Total debt | $ 300,000 | 300,000 |
2027 Notes | Significant Other Observable Inputs (Level 2) | Fair Value | ||
Debt Instrument [Line Items] | ||
Total debt | $ 309,978 | 316,839 |
2023 Notes | ||
Debt Instrument [Line Items] | ||
Weighted average interest rate | 4.875% | |
Total debt | $ 330,000 | 330,000 |
2023 Notes | Significant Other Observable Inputs (Level 2) | Fair Value | ||
Debt Instrument [Line Items] | ||
Total debt | $ 341,058 | 348,071 |
Poland Term Loan | Revolving credit facility | ||
Debt Instrument [Line Items] | ||
Weighted average interest rate | 3.08% | |
Total debt | $ 44,055 | 49,726 |
Poland Term Loan | Revolving credit facility | Significant Other Observable Inputs (Level 2) | Fair Value | ||
Debt Instrument [Line Items] | ||
Total debt | $ 44,055 | 49,726 |
Other | ||
Debt Instrument [Line Items] | ||
Weighted average interest rate | 5.10% | |
Total debt | $ 19,492 | 19,492 |
Finance leases | ||
Debt Instrument [Line Items] | ||
Total debt | $ 48,936 | 52,144 |
Short-term borrowings | ||
Debt Instrument [Line Items] | ||
Weighted average interest rate, short term | 1.161% | |
Total debt | $ 29,992 | 26,560 |
Short-term borrowings | Significant Other Observable Inputs (Level 2) | Fair Value | ||
Debt Instrument [Line Items] | ||
Total debt | $ 26,560 |
CREDIT ARRANGEMENTS (Narrative)
CREDIT ARRANGEMENTS (Narrative) (Details) | Nov. 30, 2021USD ($) | Nov. 30, 2021PLN (zł) | Aug. 31, 2021USD ($) | Aug. 31, 2021PLN (zł) | Mar. 31, 2021USD ($) |
Debt Instrument [Line Items] | |||||
Financial liabilities | $ 1,072,475,000 | $ 1,077,922,000 | |||
CMCP | |||||
Debt Instrument [Line Items] | |||||
Revolving credit facility, amount drawn | 0 | 0 | |||
Revolving credit facility current borrowing capacity | 73,000,000 | zł 300,000,000 | |||
CMCP | Poland Term Loan | |||||
Debt Instrument [Line Items] | |||||
Stand by letters of credit outstanding amount | 900,000 | 5,700,000 | |||
Financial liabilities | 44,100,000 | 181,000,000 | 49,700,000 | zł 190,500,000 | |
Poland Program | |||||
Debt Instrument [Line Items] | |||||
Transfer of accounts receivable program limit | 70,100,000 | 288,000,000 | |||
Advances outstanding under transfer of receivables programs | 30,000,000 | zł 123,200,000 | 26,600,000 | zł 101,700,000 | |
Revolving credit facility | Poland Term Loan | |||||
Debt Instrument [Line Items] | |||||
Financial liabilities | 44,055,000 | 49,726,000 | |||
Revolving credit facility | Credit Agreement Maturing March 2026 | |||||
Debt Instrument [Line Items] | |||||
Revolving credit facility, amount drawn | 0 | 0 | |||
Revolving credit facility current borrowing capacity | $ 400,000,000 | ||||
Stand-by letters of credit | |||||
Debt Instrument [Line Items] | |||||
Stand by letters of credit outstanding amount | $ 3,000,000 | $ 3,000,000 |
DERIVATIVES (Narrative) (Detail
DERIVATIVES (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Nov. 30, 2021 | Nov. 30, 2020 | Aug. 31, 2021 | |
Derivative [Line Items] | |||
Unrealized holding gain | $ 22,254 | $ 1,164 | |
Cash flow hedging instruments expected to be reclassified into earnings within the next twelve months | 3,900 | ||
Foreign exchange | |||
Derivative [Line Items] | |||
Derivative notional amount | 320,200 | $ 389,500 | |
Gain (loss) before income taxes for derivatives not designated as hedges | (8,000) | (1,900) | |
Commodity | |||
Derivative [Line Items] | |||
Derivative notional amount | 217,500 | $ 213,400 | |
Unrealized holding gain | 22,200 | 1,200 | |
Commodity | Cost of goods sold | |||
Derivative [Line Items] | |||
Gain (loss) before income taxes for derivatives not designated as hedges | $ 2,700 | $ (5,600) |
DERIVATIVES (Commodity Contract
DERIVATIVES (Commodity Contract Commitments) (Details) MWh in Thousands | 3 Months Ended |
Nov. 30, 2021MWhMMBTUt | |
Aluminum | Long | |
Derivative [Line Items] | |
Commodity contract commitments | 1,875 |
Copper | Long | |
Derivative [Line Items] | |
Commodity contract commitments | 612 |
Copper | Short | |
Derivative [Line Items] | |
Commodity contract commitments | 9,095 |
Electricity | Long | |
Derivative [Line Items] | |
Commodity contract commitment, energy | MWh | 1,817 |
Natural Gas | Long | |
Derivative [Line Items] | |
Commodity contract commitment, energy | MMBTU | 1,631,700 |
DERIVATIVES (Derivatives Not De
DERIVATIVES (Derivatives Not Designated as Hedging Instruments) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (loss) on commodity derivatives accounted for as cash flow hedging instruments | $ 22,254 | $ 1,164 |
Gain (loss) on commodity derivatives accounted for as cash flow hedging instruments, to be reclassified | 19,185 | 1,110 |
Commodity | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (loss) on commodity derivatives accounted for as cash flow hedging instruments | 22,200 | 1,200 |
Commodity | Cost of goods sold | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (loss) before income taxes for derivatives not designated as hedges | 2,700 | (5,600) |
Foreign exchange | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (loss) before income taxes for derivatives not designated as hedges | $ (8,000) | $ (1,900) |
FAIR VALUE (Narrative) (Details
FAIR VALUE (Narrative) (Details) | 3 Months Ended |
Nov. 30, 2021levels | |
Fair Value Disclosures [Abstract] | |
Number of fair value hierarchy | 3 |
FAIR VALUE (Financial Assets an
FAIR VALUE (Financial Assets and Financial Liabilities Measured at Fair Value on Recurring Basis) (Details) - USD ($) | Nov. 30, 2021 | Aug. 31, 2021 | Nov. 30, 2020 |
Significant Unobservable Inputs (Level 3) | Minimum | Commodity | Valuation Technique, Discounted Cash Flow | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Energy floating rate | $ 252.79 | $ 151.66 | |
Significant Unobservable Inputs (Level 3) | Maximum | Commodity | Valuation Technique, Discounted Cash Flow | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Energy floating rate | 540.39 | 247.56 | |
Significant Unobservable Inputs (Level 3) | Average | Commodity | Valuation Technique, Discounted Cash Flow | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Energy floating rate | 348.99 | $ 203.96 | |
Fair value, measurements, recurring | Money market investments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Money market investments | 361,387,000 | $ 441,297,000 | |
Fair value, measurements, recurring | Commodity | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative assets | 50,253,000 | 27,323,000 | |
Derivative liabilities | 375,000 | 1,352,000 | |
Fair value, measurements, recurring | Foreign exchange | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative assets | 1,207,000 | 2,537,000 | |
Derivative liabilities | 4,072,000 | 1,880,000 | |
Fair value, measurements, recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Money market investments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Money market investments | 361,387,000 | 441,297,000 | |
Fair value, measurements, recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Commodity | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative assets | 2,361,000 | 910,000 | |
Derivative liabilities | 375,000 | 1,352,000 | |
Fair value, measurements, recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Foreign exchange | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative assets | 0 | 0 | |
Derivative liabilities | 0 | 0 | |
Fair value, measurements, recurring | Significant Other Observable Inputs (Level 2) | Money market investments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Money market investments | 0 | 0 | |
Fair value, measurements, recurring | Significant Other Observable Inputs (Level 2) | Commodity | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative assets | 0 | 0 | |
Derivative liabilities | 0 | 0 | |
Fair value, measurements, recurring | Significant Other Observable Inputs (Level 2) | Foreign exchange | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative assets | 1,207,000 | 2,537,000 | |
Derivative liabilities | 4,072,000 | 1,880,000 | |
Fair value, measurements, recurring | Significant Unobservable Inputs (Level 3) | Money market investments | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Money market investments | 0 | 0 | |
Fair value, measurements, recurring | Significant Unobservable Inputs (Level 3) | Commodity | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative assets | 47,892,000 | 26,413,000 | |
Derivative liabilities | 0 | 0 | |
Fair value, measurements, recurring | Significant Unobservable Inputs (Level 3) | Foreign exchange | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivative assets | 0 | 0 | |
Derivative liabilities | $ 0 | $ 0 |
Fair Value (Reconciliation of C
Fair Value (Reconciliation of Commodity Derivative Recognized in Other Comprehensive Income) (Details) - Commodity - Significant Unobservable Inputs (Level 3) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning balance | $ 26,413 | $ (15,007) |
Unrealized holding gain | 25,208 | 1,393 |
Reclassification for gain included in net earnings | (3,729) | |
Ending balance | $ 47,892 | $ (13,614) |
FAIR VALUE (Financial Assets _2
FAIR VALUE (Financial Assets and Liabilities Not Required to Be Measured at Fair Value) (Details) - USD ($) $ in Thousands | Nov. 30, 2021 | Aug. 31, 2021 |
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Financial liabilities | $ 1,072,475 | $ 1,077,922 |
2031 Notes | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Financial liabilities | 300,000 | 300,000 |
2031 Notes | Level 2 | Fair Value | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Financial liabilities | 297,378 | 306,279 |
2027 Notes | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Financial liabilities | 300,000 | 300,000 |
2027 Notes | Level 2 | Fair Value | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Financial liabilities | 309,978 | 316,839 |
2023 Notes | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Financial liabilities | 330,000 | 330,000 |
2023 Notes | Level 2 | Fair Value | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Financial liabilities | 341,058 | 348,071 |
Short-term borrowings | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Financial liabilities | 29,992 | 26,560 |
Short-term borrowings | Level 2 | Fair Value | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Financial liabilities | 26,560 | |
Revolving credit facility | Poland Term Loan | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Financial liabilities | 44,055 | 49,726 |
Revolving credit facility | Poland Term Loan | Level 2 | Fair Value | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Financial liabilities | $ 44,055 | $ 49,726 |
STOCK-BASED COMPENSATION PLAN_2
STOCK-BASED COMPENSATION PLANS (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | ||
Nov. 30, 2021 | Nov. 30, 2020 | Nov. 30, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period in years | 3 years | ||
Share-based compensation expense | $ 0 | $ 0 | |
Stock-based compensation | $ 9,619 | $ 9,062 | $ 9,062 |
Equity method awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares granted | 1,407,000 | 1,399,000 | |
Weighted average grant-date fair value | $ 27.77 | $ 20.39 | |
Liability method awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares granted | 261,000 | 324,000 | |
Equivalent shares outstanding | 591,483 | ||
Equivalent shares expected to vest | 561,908 |
STOCKHOLDERS EQUITY AND EARNI_2
STOCKHOLDERS EQUITY AND EARNINGS PER SHARE (Calculations of the Basic and Diluted Earnings Per Share) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | ||
Nov. 30, 2021 | Nov. 30, 2020 | ||
Earnings Per Share [Abstract] | |||
Earnings from continuing operations | $ 232,889 | $ 63,911 | |
Average basic shares outstanding (shares) | 121,129,679 | 119,762,706 | |
Effect of dilutive securities (shares) | 1,668,059 | 1,365,338 | |
Average diluted shares outstanding (shares) | 122,797,738 | 121,128,044 | |
Earnings per share from continuing operations: | |||
Basic (in USD per share) | [1] | $ 1.92 | $ 0.53 |
Diluted (in USD per share) | [1] | $ 1.90 | $ 0.53 |
[1] | *Earnings Per Share ("EPS") is calculated independently for each component and may not sum to Net EPS due to rounding. |
STOCKHOLDERS EQUITY AND EARNI_3
STOCKHOLDERS EQUITY AND EARNINGS PER SHARE (Narrative) (Details) - USD ($) | 3 Months Ended | |
Nov. 30, 2021 | Oct. 31, 2021 | |
Earnings Per Share [Abstract] | ||
Stock repurchase program, authorized amount | $ 350,000,000 | |
Treasury stock acquired, shares | 159,500 | |
Treasury stock acquired (in dollars per share) | $ 33.28 | |
Stock repurchase program, remaining authorized repurchase amount | $ 344,700,000 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Narrative) (Details) - CERCLA sites - USD ($) $ in Millions | Nov. 30, 2021 | Aug. 31, 2021 |
Loss Contingencies [Line Items] | ||
Accrual for environmental loss contingencies | $ 5.2 | $ 7.1 |
Accrued environmental loss contingencies, noncurrent | $ 2.2 | $ 2.3 |
BUSINESS SEGMENTS (Narrative) (
BUSINESS SEGMENTS (Narrative) (Details) | 3 Months Ended |
Nov. 30, 2021segments | |
Segment Reporting [Abstract] | |
Number of reporting segments | 2 |
BUSINESS SEGMENTS (Summary of C
BUSINESS SEGMENTS (Summary of Certain Financial Information from Continuing Operations by Reportable Segment and Major Product) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Nov. 30, 2021 | Nov. 30, 2020 | Aug. 31, 2021 | |
Segment Reporting Information [Line Items] | |||
Net sales | $ 1,981,801 | $ 1,391,803 | |
Adjusted EBITDA from continuing operations | 314,022 | 143,633 | |
Total assets | 4,725,258 | $ 4,638,671 | |
Segments | Continuing Operations | |||
Segment Reporting Information [Line Items] | |||
Net sales | 1,981,801 | 1,391,803 | |
Adjusted EBITDA from continuing operations | 314,022 | 143,633 | |
Total assets | 4,725,258 | 4,638,671 | |
Segments | North America | |||
Segment Reporting Information [Line Items] | |||
Net sales | 1,653,622 | 1,195,013 | |
Adjusted EBITDA from continuing operations | 268,524 | 155,634 | |
Total assets | 3,389,890 | 3,221,465 | |
Segments | Europe | |||
Segment Reporting Information [Line Items] | |||
Net sales | 329,056 | 194,596 | |
Adjusted EBITDA from continuing operations | 79,832 | 14,470 | |
Total assets | 736,872 | 729,766 | |
Segments | Unaffiliated Customers | |||
Segment Reporting Information [Line Items] | |||
Net sales | 1,981,801 | 1,391,803 | |
Segments | Unaffiliated Customers | North America | |||
Segment Reporting Information [Line Items] | |||
Net sales | 1,653,622 | 1,195,013 | |
Segments | Unaffiliated Customers | Europe | |||
Segment Reporting Information [Line Items] | |||
Net sales | 328,562 | 194,185 | |
Segments | Raw materials | |||
Segment Reporting Information [Line Items] | |||
Net sales | 360,052 | 213,067 | |
Segments | Raw materials | North America | |||
Segment Reporting Information [Line Items] | |||
Net sales | 353,092 | 210,237 | |
Segments | Raw materials | Europe | |||
Segment Reporting Information [Line Items] | |||
Net sales | 6,960 | 2,830 | |
Segments | Steel Products | |||
Segment Reporting Information [Line Items] | |||
Net sales | 918,187 | 609,112 | |
Segments | Steel Products | North America | |||
Segment Reporting Information [Line Items] | |||
Net sales | 675,042 | 457,657 | |
Segments | Steel Products | Europe | |||
Segment Reporting Information [Line Items] | |||
Net sales | 243,145 | 151,455 | |
Segments | Downstream products | |||
Segment Reporting Information [Line Items] | |||
Net sales | 584,468 | 471,502 | |
Segments | Downstream products | North America | |||
Segment Reporting Information [Line Items] | |||
Net sales | 514,396 | 437,029 | |
Segments | Downstream products | Europe | |||
Segment Reporting Information [Line Items] | |||
Net sales | 70,072 | 34,473 | |
Segments | Other | |||
Segment Reporting Information [Line Items] | |||
Net sales | 119,094 | 98,122 | |
Segments | Other | North America | |||
Segment Reporting Information [Line Items] | |||
Net sales | 111,092 | 90,090 | |
Segments | Other | Europe | |||
Segment Reporting Information [Line Items] | |||
Net sales | 8,385 | 5,427 | |
Segments | Corporate | |||
Segment Reporting Information [Line Items] | |||
Net sales | (877) | 2,194 | |
Adjusted EBITDA from continuing operations | (34,334) | (26,471) | |
Segments | Corporate | Unaffiliated Customers | |||
Segment Reporting Information [Line Items] | |||
Net sales | (383) | 2,605 | |
Segments | Corporate | Raw materials | |||
Segment Reporting Information [Line Items] | |||
Net sales | 0 | 0 | |
Segments | Corporate | Steel Products | |||
Segment Reporting Information [Line Items] | |||
Net sales | 0 | 0 | |
Segments | Corporate | Downstream products | |||
Segment Reporting Information [Line Items] | |||
Net sales | 0 | 0 | |
Segments | Corporate | Other | |||
Segment Reporting Information [Line Items] | |||
Net sales | (383) | 2,605 | |
Segments | Corporate and Other | |||
Segment Reporting Information [Line Items] | |||
Total assets | 598,496 | 687,440 | |
Intersegment | |||
Segment Reporting Information [Line Items] | |||
Net sales | 0 | 0 | |
Intersegment | North America | |||
Segment Reporting Information [Line Items] | |||
Net sales | 0 | 0 | |
Intersegment | Europe | |||
Segment Reporting Information [Line Items] | |||
Net sales | 494 | 411 | |
Intersegment | Corporate | |||
Segment Reporting Information [Line Items] | |||
Net sales | $ (494) | $ (411) |
BUSINESS SEGMENTS (Reconciliati
BUSINESS SEGMENTS (Reconciliations of Earnings from Continuing Operations to Adjusted Operating Profit) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Segment Reporting [Abstract] | ||
Earnings from continuing operations | $ 232,889 | $ 63,911 |
Interest expense | 11,035 | 14,259 |
Income taxes | 28,872 | 21,593 |
Depreciation and amortization | 41,226 | 41,799 |
Asset impairments | 0 | 3,594 |
Amortization of acquired unfavorable contract backlog | 0 | (1,523) |
Adjusted EBITDA from continuing operations | $ 314,022 | $ 143,633 |
SUBSEQUENT EVENT (Details)
SUBSEQUENT EVENT (Details) $ in Millions | Dec. 03, 2021USD ($) |
Subsequent Event | TAC Acquisition Corp. (Tensar) | |
Subsequent Event [Line Items] | |
Consideration transferred | $ 550 |