AZZ (AZZ) 10-Q 8 Jan 19 2019 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information	9 Months Ended
	Nov. 30, 2018shares
Document and Entity Information [Abstract]
Entity Registrant Name	AZZ INC
Entity Central Index Key	8,947
Document Type	10-Q
Document Period End Date	Nov. 30, 2018
Amendment Flag	false
Document Fiscal Year Focus	2,019
Document Fiscal Period Focus	Q3
Current Fiscal Year End Date	--02-28
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding	26,087,191

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Nov. 30, 2018	Feb. 28, 2018
Current assets:
Cash and cash equivalents	$ 17,413	$ 20,853
Accounts receivable (net of allowance for doubtful accounts of $2,348 as of November 30, 2018 and $569 as of February 28, 2018)	159,395	141,488
Inventories:
Raw material	100,594	98,475
Work-in-process	1,694	2,544
Finished goods	12,688	9,742
Contract assets	70,419	51,787
Prepaid expenses and other	5,171	4,265
Total current assets	367,374	329,154
Property, plant and equipment, net	207,090	216,855
Goodwill	323,541	321,307
Intangibles and other assets, net	134,374	160,893
Total assets	1,032,379	1,028,209
Current liabilities:
Accounts payable	45,072	54,162
Income tax payable	3,120	144
Accrued salaries and wages	22,606	19,011
Other accrued liabilities	23,532	19,622
Customer deposits	741	1,816
Contract liabilities	32,744	22,698
Debt due within one year	0	14,286
Total current liabilities	127,815	131,739
Debt due after one year, net	272,712	286,609
Other long-term liabilities	1,564	11,696
Deferred income taxes	34,410	32,962
Total liabilities	436,501	463,006
Shareholders’ equity:
Common stock, $1 par, shares authorized 100,000; 26,087 shares issued and outstanding at November 30, 2018 and 25,959 shares issued and outstanding at February 28, 2018	26,087	25,959
Capital in excess of par value	43,944	38,446
Retained earnings	555,096	526,018
Accumulated other comprehensive loss	(29,249)	(25,220)
Total shareholders’ equity	595,878	565,203
Total liabilities and shareholders' equity	$ 1,032,379	$ 1,028,209

Condensed consolidated Balanc_2

Condensed consolidated Balance Sheets (Parenthetical) - USD ($) shares in Thousands, $ in Thousands	Nov. 30, 2018	Feb. 28, 2018
Statement of Financial Position [Abstract]
Accounts Receivable, Allowance for Doubtful Accounts	$ 2,348	$ 569
Common Stock, Par Value (usd per share)	$ 1	$ 1
Common Stock, Shares Authorized (shares)	100,000	100,000
Common Stock, Shares Issued (shares)	26,087	25,959
Common Stock, Shares, Outstanding	26,087	25,959

Condensed Consolidated Statemen

Condensed Consolidated Statements of Income (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Nov. 30, 2018	Nov. 30, 2017	Nov. 30, 2018	Nov. 30, 2017
Income Statement [Abstract]
Net sales	$ 239,516	$ 208,158	$ 724,539	$ 609,770
Costs and Expenses
Cost of sales	189,761	177,041	569,175	487,471
Gross margin	49,755	31,117	155,364	122,299
Selling, general and administrative	26,986	29,563	91,794	83,335
Operating income	22,769	1,554	63,570	38,964
Interest expense	3,723	3,507	11,541	10,267
Other (income) expense, net	309	15	(839)	90
Income (loss) before income taxes	18,737	(1,968)	52,868	28,607
Income tax expense (benefit)	3,342	(1,802)	10,511	6,925
Net income (loss)	$ 15,395	$ (166)	$ 42,357	$ 21,682
Earnings Per Common Share
Basic Earnings Per Share (usd per share)	$ 0.59	$ (0.01)	$ 1.63	$ 0.83
Diluted Earnings Per Share (usd per share)	0.59	(0.01)	1.62	0.83
Common Stock, Dividends, Per Share, Declared	$ 0.17	$ 0.17	$ 0.51	$ 0.51

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Nov. 30, 2018	Nov. 30, 2017	Nov. 30, 2018	Nov. 30, 2017
Statement of Comprehensive Income [Abstract]
Net income (loss)	$ 15,395	$ (166)	$ 42,357	$ 21,682
Other comprehensive income (loss):
Foreign currency translation adjustments, net of income tax of $0	(2,187)	(1,453)	(3,988)	2,876
Interest rate swap, net of income tax of $7, $7, $22 and $22, respectively.	(14)	(13)	(41)	(41)
Other comprehensive income (loss)	(2,201)	(1,466)	(4,029)	2,835
Comprehensive income (loss)	$ 13,194	$ (1,632)	$ 38,328	$ 24,517

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Comprehensive Income (Parenthetical) (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Nov. 30, 2018	Nov. 30, 2017	Nov. 30, 2018	Nov. 30, 2017
Statement of Comprehensive Income [Abstract]
Interest rate swap, income tax	$ 7	$ 7	$ 22	$ 22

Condensed Consolidated Statem_4

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Nov. 30, 2018	Nov. 30, 2017
Cash Flows From Operating Activities:
Net income (loss)	$ 42,357	$ 21,682
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for doubtful accounts	2,039	2,940
Amortization and depreciation	38,068	37,840
Deferred income taxes	1,533	2,362
Net loss on property, plant and equipment due to impairment	810	8,285
Net loss (gain) on sale of property, plant and equipment	(191)	576
Amortization of deferred borrowing costs	407	450
Share-based compensation expense	3,335	4,810
Effects of changes in assets and liabilities:
Accounts receivable	(13,955)	(15,754)
Inventories	1,564	(11,744)
Prepaid expenses and other	(953)	(2,518)
Other assets	(1,006)	(57)
Net change in contract assets and liabilities	(9,496)	4,896
Accounts payable	(8,037)	(5,867)
Other accrued liabilities and income taxes payable	3,920	(9,191)
Net cash provided by operating activities	60,395	38,710
Cash Flows Used For Investing Activities:
Proceeds from sale of property, plant and equipment	362	200
Purchase of Property, Plant and Equipment	(13,691)	(21,533)
Acquisition of Subsidiaries, Net of Cash Acquired	(8,000)	(32,841)
Net Cash From Investing Activities	(21,329)	(54,174)
Cash Flows From Financing Activities:
Proceeds from revolving loan	212,000	273,000
Payments on revolving loan	(226,000)	(174,500)
Payments on Long Term Debt	(14,286)	(63,505)
Payments for Repurchase of Common Stock	0	(7,518)
Payments of Dividends	(13,279)	(13,266)
Net Cash Used In Financing Activities	(41,565)	14,211
Effect of Exchange Rate Changes on Cash	(941)	602
Net Increase (Decrease) In Cash & Cash Equivalents	(3,440)	(651)
Cash & Cash Equivalents At Beginning of Period	20,853	11,302
Cash & Cash Equivalents At End of Period	17,413	10,651
Supplemental Disclosures
Cash Paid For Interest	9,957	8,948
Cash Paid For Income Taxes	$ 2,398	$ 8,416

Consolidated Statement of Share

Consolidated Statement of Shareholders' Equity - Q Statement - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Capital in Excess of Par Value	Retained Earnings	Accumulated Other Comprehensive Income (Loss)
Balance (shares) at Feb. 28, 2017		25,964
Balance at Feb. 28, 2017	$ 533,136	$ 25,964	$ 37,739	$ 498,527	$ (29,094)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock Compensation (shares)		0
Restricted Stock Units (shares)		42
Stock Compensation	1,194	$ 0	1,194
Restricted Stock Units	(1,198)	$ 42	(1,240)
Employee Stock Purchase Plan (shares)		35
Employee Stock Purchase Plan	1,632	$ 35	1,597
Treasury Stock, Shares, Retired		(47)
Treasury Stock, Retired, Par Value Method, Amount	(2,683)	$ 47	2,636
Cash Dividend Paid	(4,423)			(4,423)
Net income (loss)	12,062			12,062
Foreign Currency Translation	(997)				(997)
Interest rate swap	(14)				(14)
Balance (shares) at May. 31, 2017		25,994
Balance at May. 31, 2017	538,709	$ 25,994	36,654	506,166	(30,105)
Balance (shares) at Feb. 28, 2017		25,964
Balance at Feb. 28, 2017	533,136	$ 25,964	37,739	498,527	(29,094)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	21,682
Foreign Currency Translation	2,876
Interest rate swap	(41)
Balance (shares) at Nov. 30, 2017		25,954
Balance at Nov. 30, 2017	543,776	$ 25,954	37,138	506,943	(26,259)
Balance (shares) at May. 31, 2017		25,994
Balance at May. 31, 2017	538,709	$ 25,994	36,654	506,166	(30,105)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock Compensation (shares)		16
Stock Compensation	2,206	$ 16	2,190
Stock Issued For Stock Appreciation Rights	0	$ 1	(1)
Stock Issued for Stock Appreciation Rights Shares		1
Treasury Stock, Shares, Retired		(50)
Treasury Stock, Retired, Par Value Method, Amount	(2,502)	$ 50	2,452
Cash Dividend Paid	(4,422)			(4,422)
Net income (loss)	9,786			9,786
Foreign Currency Translation	5,325				5,325
Interest rate swap	(13)				(13)
Balance (shares) at Aug. 31, 2017		25,961
Balance at Aug. 31, 2017	549,089	$ 25,961	36,391	511,530	(24,793)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock Compensation (shares)		0
Restricted Stock Units (shares)		1
Stock Compensation	1,410	$ 0	1,410
Restricted Stock Units	(18)	1	(19)
Stock Issued For Stock Appreciation Rights	(4)	$ 0	(4)
Employee Stock Purchase Plan (shares)		42
Stock Issued for Stock Appreciation Rights Shares		0
Employee Stock Purchase Plan	1,685	$ 42	1,643
Treasury Stock, Shares, Retired		(50)
Treasury Stock, Retired, Par Value Method, Amount	(2,333)	$ 50	2,283
Cash Dividend Paid	(4,421)			(4,421)
Net income (loss)	(166)			(166)
Foreign Currency Translation	(1,453)				(1,453)
Interest rate swap	(13)				(13)
Balance (shares) at Nov. 30, 2017		25,954
Balance at Nov. 30, 2017	543,776	$ 25,954	37,138	506,943	(26,259)
Balance (shares) at Feb. 28, 2018		25,959
Balance at Feb. 28, 2018	565,203	$ 25,959	38,446	526,018	(25,220)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock Compensation (shares)		0
Restricted Stock Units (shares)		30
Stock Compensation	1,358	$ 0	1,358
Restricted Stock Units	(519)	30	(549)
Stock Issued For Stock Appreciation Rights	1	$ 1	0
Employee Stock Purchase Plan (shares)		37
Stock Issued for Stock Appreciation Rights Shares		1
Employee Stock Purchase Plan	1,327	$ 37	1,290
Cash Dividend Paid	(4,418)			(4,418)
Net income (loss)	15,718			15,718
Foreign Currency Translation	(2,256)				(2,256)
Interest rate swap	(14)				(14)
Balance (shares) at May. 31, 2018		26,027
Balance at May. 31, 2018	576,400	$ 26,027	40,545	537,318	(27,490)
Balance (shares) at Feb. 28, 2018		25,959
Balance at Feb. 28, 2018	565,203	$ 25,959	38,446	526,018	(25,220)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	42,357
Foreign Currency Translation	(3,988)
Interest rate swap	(41)
Balance (shares) at Nov. 30, 2018		26,087
Balance at Nov. 30, 2018	595,878	$ 26,087	43,944	555,096	(29,249)
Balance (shares) at May. 31, 2018		26,027
Balance at May. 31, 2018	576,400	$ 26,027	40,545	537,318	(27,490)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock Compensation (shares)		15
Restricted Stock Units (shares)		0
Stock Compensation	2,301	$ 15	2,286
Restricted Stock Units	(14)	0	(14)
Stock Issued For Stock Appreciation Rights	(22)	$ 8	(30)
Stock Issued for Stock Appreciation Rights Shares		8
Cash Dividend Paid	(4,426)			(4,426)
Net income (loss)	11,244			11,244
Foreign Currency Translation	455				455
Interest rate swap	(13)				(13)
Balance (shares) at Aug. 31, 2018		26,050
Balance at Aug. 31, 2018	585,925	$ 26,050	42,787	544,136	(27,048)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock Compensation (shares)		0
Stock Compensation	(324)	$ 0	(324)
Employee Stock Purchase Plan (shares)		37
Employee Stock Purchase Plan	1,518	$ 37	1,481
Cash Dividend Paid	(4,435)			(4,435)
Net income (loss)	15,395			15,395
Foreign Currency Translation	(2,187)				(2,187)
Interest rate swap	(14)				(14)
Balance (shares) at Nov. 30, 2018		26,087
Balance at Nov. 30, 2018	$ 595,878	$ 26,087	$ 43,944	$ 555,096	$ (29,249)

Basis of Presentation (Notes)

Basis of Presentation (Notes)	9 Months Ended
	Nov. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation	The Company and Basis of Presentation AZZ Inc. (“AZZ”, the “Company”, "our" or “we”) was established in 1956 and incorporated under the laws of the state of Texas. The Company is a global provider of metal coating services, welding solutions, specialty electrical equipment and highly engineered services to the power generation, transmission, distribution, refining and industrial markets. The Company has two distinct operating segments: the Energy segment and the Metal Coatings segment. AZZ Energy is dedicated to delivering safe and reliable transmission of power from generation sources to end customers, and automated weld overlay solutions for corrosion and erosion mitigation to critical infrastructure in the energy markets worldwide. AZZ Metal Coatings is a leading provider of metal finishing solutions for corrosion protection, including hot dip galvanizing to the North American steel fabrication industry. Presentation The accompanying condensed consolidated balance sheet as of February 28, 2018 , which was derived from audited financial statements, and the unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete consolidated financial statements. These financial statements should be read in conjunction with the audited financial statements and related notes for the fiscal year ended February 28, 2018 , included in the Company’s Annual Report on Form 10-K covering such period. Our fiscal year ends on the last day of February and is identified as the fiscal year for the calendar year in which it ends. For example, the fiscal year ended February 28, 2019 is referred to as fiscal 2019. In the opinion of management, the accompanying unaudited consolidated financial statements include all adjustments, consisting only of normal recurring adjustments, which are necessary to present fairly the financial position of the Company as of November 30, 2018 , the results of its operations for the three and nine months ended November 30, 2018 and 2017 , and cash flows for the nine months ended November 30, 2018 and 2017 . These interim results are not necessarily indicative of results for a full year. Accounting Standards Recently Adopted On March 1, 2018, the Company adopted Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers (Topic 606) and the related amendments ("ASC 606") using the modified retrospective method applied to those contracts which were not completed as of February 28, 2018. Results for operating periods beginning on or after March 1, 2018 are presented under ASC 606, while prior period amounts have not been adjusted and continue to be reported in accordance with the accounting standards in effect for those periods. However, for the three and nine months ended November 30, 2018, the impact of applying ASC 606 as opposed to applying legacy accounting guidance did not result in a significant change to reported revenues or costs of revenues. Accordingly, no reconciliation has been provided to show the difference between applying ASC 606 and legacy guidance for the three and nine months ended November 30, 2018 . In addition, there was no cumulative effect adjustment to the beginning retained earnings on March 1, 2018 related to the adoption. See Note 2 for a description of the Company's accounting policy resulting from the adoption of ASC 606. On March 1, 2018, the Company adopted ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments , which clarifies the presentation and classification of certain cash receipts and cash payments in the statement of cash flows. The adoption did not have a material impact on the Company's consolidated statements of cash flows. Recently Issued Accounting Pronouncements In February 2016, the Financial Accounting Standards Board ("FASB") issued ASU 2016-02, Leases (Topic 842) . Under the new guidance, a lessee will be required to recognize assets and liabilities for all leases with lease terms of more than 12 months. Consistent with current GAAP, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as a finance or operating lease. The Company expects to early adopt this standard in the fourth quarter of fiscal year 2019, which will be retrospectively applied to the beginning of fiscal year 2019. The standard, as subsequently amended, does not require full retrospective adoption, thus periods prior to fiscal year 2019 will not be adjusted and any impacts of transitioning to the new standard will be reflected with a cumulative effect adjustment to the opening balance of retained earnings in the year of adoption. In preparing for the adoption of this standard, the Company is substantially complete in assessing its portfolio of leases for accounting and disclosure purposes. The Company is also progressing with the design of the future lease accounting procedures, policies and related internal controls and with the implementation of lease accounting software. While the Company has not yet completed its evaluation of the financial statement impact of the new lease accounting standard, the Company expects that the adoption will result in a significant increase in assets and liabilities related to operating leases in its consolidated balance sheets. However, the Company does not expect to record a significant cumulative effect adjustment as a result of adopting the standard.

Summary of Significant Accounti

Summary of Significant Accounting Policies	9 Months Ended
	Nov. 30, 2018
Accounting Policies [Abstract]
Significant Accounting Policies [Text Block]	Summary of Significant Accounting Policies The Company’s significant accounting policies are detailed in Note 1 of its Annual Report on Form 10-K for the year ended February 28, 2018. The following section includes revised accounting policies related to the adoption of ASC 606. Revenue recognition The Company determines revenue recognition through the following steps: 1) Identification of the contract with a customer, 2) Identification of the performance obligations in the contract, 3) Determination of the transaction price, 4) Allocation of the transaction price to performance obligations in the contract, and 5) Recognition of revenue when, or as, the Company satisfies a performance obligation Revenue is recognized when control of the promised goods or services is transferred to the Company’s customers, in an amount that reflects the consideration that it expects to be entitled to in exchange for those goods or services. The amount and timing of revenue recognition varies by segment based on the nature of the goods or services provided and the terms and conditions of the customer contract. Energy Segment AZZ's Energy segment is a provider of specialized products and services designed to support industrial, nuclear and electrical applications. Within this segment, the contract is governed by a customer purchase order and an executed product or services agreement. The contract generally specifies the delivery of what constitutes a single performance obligation consisting of either custom built products, custom services, or off-the-shelf products. When the Company does enter into an arrangement with multiple performance obligations, the transaction price is allocated to each performance obligation based on the relative standalone selling prices of the goods or services being provided to the customer and revenue is recognized upon the satisfaction of each performance obligation. The Company combines contracts for revenue recognition purposes that are executed with the same customer within a short timeframe from each other and that purport to be for a single commercial objective. For custom built products, the Company recognizes revenues over time provided that the goods do not have an alternative use to the Company and the Company has an unconditional right to payment for work completed to date plus a reasonable margin. For custom services, which consist of specialized welding and other professional services, the Company recognizes revenues over time as the services are rendered due to the fact that the services enhance a customer owned asset. For off-the-shelf products, which consist of tubing and lighting products, the Company recognizes revenue at a point-in-time upon the transfer of the goods to the customer. For services and custom built products, the Company recognizes revenues over time using a cost-to-cost input measure. This requires the Company to estimate the total contract revenues, costs and margin, which can involve significant management judgment. As a significant change in one or more of these estimates could affect the profitability of the Company’s contracts, management reviews and updates its contract related estimates regularly. The Company recognizes adjustments in estimated margin on contracts under a cumulative catch-up basis and subsequent revenues are recognized using the adjusted estimate. If the estimate of contract margin indicates an anticipated loss on the contract, the Company recognizes the total estimated loss in the period it is identified. Due to the custom nature of the goods and services provided, contracts within the Energy segment are often modified to account for changes in contract specifications and requirements. A contract modification exists when the modification either creates new, or changes the existing, enforceable rights and obligations in the contract. For the Company, most contract modifications are related to goods or services that are not distinct from those in the original contract due to the significant interrelationship or interdependencies between the deliverables. Such modifications are accounted for as if they were part of the original contract. As a result, the transaction price and the measure of progress for the performance obligation to which it relates, is recognized as an adjustment to revenue on a cumulative catch-up basis. In addition to fixed consideration, the Company’s contracts within its Energy segment can include variable consideration, including claims, incentive fees, liquidated damages or other penalties. The Company recognizes revenue for variable consideration when it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur. The Company estimates the amount of revenue to be recognized on variable consideration using the expected value or the most likely amount method, whichever is expected to better predict the amount. Metal Coatings Segment AZZ’s Metal Coatings segment is a provider of hot dip galvanizing, powder coating and other metal coating applications to the steel fabrication industry. Within this segment, the contract is governed by a customer purchase order or work order. The contract generally specifies the delivery of what constitutes a single performance obligation consisting of metal coating services. The Company combines contracts for revenue recognition purposes that are executed with the same customer within a short timeframe from each other and that purport to be for a single commercial objective. The Company recognizes revenue over time as the metal coating is applied to the customer provided material as the process enhances a customer controlled asset. Contract modifications are rare within this segment and most contracts are on a fixed price basis with no variable consideration. Contract Assets and Liabilities The timing of revenue recognition, billings and cash collections results in accounts receivable, contract assets (unbilled receivables), and contract liabilities (customer advances and deposits) on the consolidated balance sheet, primarily related to the Company’s Energy segment. Amounts are billed as work progresses in accordance with agreed upon contractual terms, either at periodic intervals (e.g., weekly or monthly) or upon achievement of contractual milestones. Billing can occur subsequent to revenue recognition, resulting in contract assets. In addition, the Company can receive advances or deposits from its customers, before revenue is recognized, resulting in contract liabilities. These assets and liabilities are reported on the consolidated balance sheet on a contract-by-contract basis at the end of each reporting period. For the nine months ended November 30, 2018 , the Company recognized $20.1 million of revenues from amounts that were included in contract liabilities at February 28, 2018. The Company did not record any revenues for the three or nine months ended November 30, 2018 related to performance obligations satisfied in prior periods. The Company expects to recognize revenues of approximately $13.8 million , $16.1 million , $1.5 million and $1.3 million in fiscal 2019 , 2020 , 2021 and 2022, respectively, related to the $32.7 million balance of contract liabilities as of November 30, 2018 . The increases or decreases in accounts receivable, contract assets and contract liabilities during the three and nine months ended November 30, 2018 were due primarily to normal timing differences between the Company’s performance and customer payments. The Lectrus acquisition described in Note 8 had no impact on contract assets or liabilities as of the date of acquisition. Other No general rights of return exist for customers and the Company establishes provisions for estimated warranties. The Company generally does not sell extended warranties. Revenue is recognized net of applicable sales and other taxes. The Company does not adjust the contract price for the effects of a significant financing component if the Company expects, at contract inception, that the period between when the Company transfers a good or service to a customer and when the customer pays for that good or service will be one year or less, which is generally the case. Sales commissions are deferred and recognized over the same period as the related revenues. Shipping and handling is treated as a fulfillment obligation instead of a separate performance obligation and such costs are expensed as incurred. Disaggregated Revenue Revenue by segment and geography is disclosed in Note 5. In addition, the following table presents disaggregated revenue by customer industry (in thousands): Three Months Ended November 30, Nine Months Ended November 30, 2018 2017 2018 2017 Net sales: Industrial - oil and gas, construction, and general $ 143,710 $ 126,976 $ 415,323 $ 355,895 Transmission and distribution 35,927 45,795 162,033 130,134 Power generation 59,879 35,387 147,183 123,741 Total net sales $ 239,516 $ 208,158 $ 724,539 $ 609,770

Earnings Per Share

Earnings Per Share	9 Months Ended
	Nov. 30, 2018
Earnings Per Share [Abstract]
Earnings Per Share	Earnings (Loss) Per Share Earnings (loss) per share is based on the weighted average number of shares outstanding during each period, adjusted for the dilutive effect of stock awards. The following table sets forth the computation of basic and diluted earnings (loss) per share (in thousands, expect per share data): Three Months Ended November 30, Nine Months Ended November 30, 2018 2017 2018 2017 Numerator: Net income (loss) for basic and diluted earnings per common share $ 15,395 $ (166 ) $ 42,357 $ 21,682 Denominator: Denominator for basic earnings per common share–weighted average shares 26,064 25,965 26,022 25,982 Effect of dilutive securities: Employee and director stock awards 87 — 70 67 Denominator for diluted earnings per common share 26,151 25,965 26,092 26,049 Earnings (loss) per share basic and diluted: Basic earnings (loss) per common share $ 0.59 $ (0.01 ) $ 1.63 $ 0.83 Diluted earnings (loss) per common share $ 0.59 $ (0.01 ) $ 1.62 $ 0.83 For the three months ended November 30, 2017, approximately 0.1 million shares related to employee and director stock awards were excluded from the diluted shares outstanding count as the effect was anti-dilutive.

Stock-based Compensation

Stock-based Compensation	9 Months Ended
	Nov. 30, 2018
Share-based Compensation [Abstract]
Stock-based Compensation	Share-based Compensation The Company has one share-based compensation plan, the 2014 Long Term Incentive Plan (the “Plan”). The purpose of the Plan is to promote the growth and prosperity of the Company by permitting the Company to grant to its employees, directors and advisors various types of restricted stock unit awards, performance share units, stock options, and stock appreciation rights to purchase common stock of the Company. The maximum number of shares that may be issued under the Plan is 1,500,000 shares. As of November 30, 2018 , the Company had approximately 1,248,775 shares available for future issuance under the Plan. Restricted Stock Unit Awards Restricted stock unit awards are valued at the market price of our common stock on the grant date. Awards generally vest ratably over a period of three years but these awards may vest earlier in accordance with the Plan’s accelerated vesting provisions. A summary of the Company’s non-vested restricted stock unit award activity for the nine month period ended November 30, 2018 is as follows: Restricted Stock Units Weighted Average Grant Date Fair Value Non-vested balance as of February 28, 2018 109,777 $ 56.62 Granted 84,023 42.01 Vested (37,670 ) 54.63 Forfeited (7,290 ) 55.27 Non-vested balance as of November 30, 2018 148,840 $ 48.94 Performance Share Unit Awards The Company also grants performance share units ("PSU") awards to certain employees. These PSU awards have a three year performance cycle and will vest and become payable, if at all, on the third anniversary of the award date. The PSU awards are subject to the Company’s degree of achievement of a target annual average adjusted return on assets during these three-year periods and, in certain circumstances, vesting is based on the relative performance of a predetermined group of peer companies. In addition, these PSU awards may have vesting conditions or certain vesting multipliers, which are based on the Company’s total shareholder return during such three -year period in comparison to a defined specific industry peer group. The Company estimates the fair value of PSU awards with performance and service conditions using the value of the Company's common stock on the date of grant. The Company estimates the fair value of PSU awards with market conditions using a Monte Carlo simulation model on the date of grant. A summary of the Company’ non-vested performance share unit award activity for the nine month period ended November 30, 2018 is as follows: Performance Weighted Non-vested balance as of February 28, 2018 70,030 $ 54.59 Granted 46,183 42.00 Vested (3,378 ) 46.65 Forfeited (29,710 ) 49.51 Non-vested balance as of November 30, 2018 83,125 $ 49.74 Stock Appreciation Rights Stock appreciation rights are granted with an exercise price equal to the market value of our common stock on the date of grant. These awards generally have a contractual term of 7 years and vest ratably over a period of three years although some may vest immediately on issuance. These awards are valued using the Black-Scholes option-pricing model. A summary of the Company’s stock appreciation rights activity for the nine month period ended November 30, 2018 is as follows: SARs Weighted Average Exercise Price Outstanding as of February 28, 2018 148,513 $ 43.29 Granted — — Exercised (47,484 ) 40.84 Forfeited (2,845 ) 43.92 Outstanding as of November 30, 2018 98,184 $ 44.46 Exercisable as of November 30, 2018 98,184 $ 44.46 The average remaining contractual term for those stock appreciation rights outstanding and those stock appreciation rights that were exercisable as of November 30, 2018 was 2.09 years, with an aggregate intrinsic value of $0.3 million . Employee Stock Purchase Plan The Company also has an Employee Stock Purchase Plan, which allows employees of the Company to purchase common stock of the Company through accumulated payroll deductions. Offerings under this plan have a duration of 24 months (the "offering period"). On the first day of an offering period (the “enrollment date”) the participant is granted the option to purchase shares on each exercise date at the lower of 85% of the market value of a share of our common stock on the enrollment date or the exercise date. The participant’s right to purchase common stock under the plan is restricted to no more than $25,000 per calendar year and the participant may not purchase more than 5,000 shares during any offering period. Participants may terminate their interest in a given offering or a given exercise period by withdrawing all of their accumulated payroll deductions at any time prior to the end of the offering period. The fair value of the estimated number of shares to be issued under each offering is determined using the Black-Scholes option-pricing model. For the nine month period ended November 30, 2018 , the Company issued 73,702 shares under the Company's Employee Stock Purchase Plan. Share-based Compensation Expense Share-based compensation expense and related income tax benefits related to all the plans listed above were as follows (in thousands): Nine Months Ended November 30, 2018 2017 Compensation expense $ 3,335 $ 4,810 Income tax benefits $ 700 $ 1,684 Unrecognized compensation cost related to restricted stock units, performance share unit awards, stock appreciation rights, and the Company's Employee Stock Purchase Plan at November 30, 2018 totals $8.0 million . The Company’s policy is to issue shares required under these plans from the Company’s authorized but unissued shares.

Segments

Segments	9 Months Ended
	Nov. 30, 2018
Segment Reporting [Abstract]
Segments	Segments Segment Information Net sales and operating income by segment for each period were as follows (in thousands): Three Months Ended November 30, Nine Months Ended November 30, 2018 2017 2018 2017 Net sales: Energy $ 132,025 $ 107,021 $ 385,526 $ 317,526 Metal Coatings 107,491 101,137 339,013 292,244 Total net sales $ 239,516 $ 208,158 $ 724,539 $ 609,770 Operating income (loss): Energy $ 11,532 $ (12,103 ) $ 25,763 $ (3,029 ) Metal Coatings 18,321 21,681 65,581 66,332 Corporate (7,084 ) (8,024 ) (27,774 ) (24,339 ) Total operating income $ 22,769 $ 1,554 $ 63,570 $ 38,964 Asset balances by segment for each period were as follows (in thousands): November 30, 2018 February 28, 2018 Total assets: Energy $ 585,807 $ 554,866 Metal Coatings 436,873 460,575 Corporate 9,699 12,768 Total $ 1,032,379 $ 1,028,209 In the second quarter of fiscal 2019, the Company recognized impairment charges of $0.8 million, which were classified within cost of sales in the consolidated statement of income and were related to property, plant and equipment in the Metal Coatings segment that was vacated or abandoned upon the consolidation of two galvanizing facilities in the Gulf Coast region of the United States. As part of the consolidation of facilities, the Company also recognized $0.5 million in employee severance and other disposal costs in the second quarter of fiscal 2019, which were also classified within cost of sales in the consolidated statement of income. Financial Information About Geographical Areas The following table presents revenues by geographic region for each period (in thousands): Three Months Ended November 30, Nine Months Ended November 30, 2018 2017 2018 2017 Net sales: United States $ 203,788 $ 175,803 $ 605,672 $ 505,023 International 35,728 32,355 118,867 104,747 Total $ 239,516 $ 208,158 $ 724,539 $ 609,770 The following table presents fixed assets by geographic region for each period (in thousands): November 30, 2018 February 28, 2018 Property, plant and equipment, net: United States $ 186,696 $ 194,418 Canada 16,619 18,254 Other countries 3,775 4,183 Total $ 207,090 $ 216,855

Warranty Reserves

Warranty Reserves	9 Months Ended
	Nov. 30, 2018
Product Warranties Disclosures [Abstract]
Warranty Reserves	Warranty Reserves A reserve has been established to provide for the estimated future cost of warranties on a portion of the Company’s delivered products and is classified within other accrued liabilities on the consolidated balance sheets. Management periodically reviews the reserves and makes adjustments accordingly. Warranties cover such factors as non-conformance to specifications and defects in material and workmanship. The following table shows the changes in the warranty reserves for the nine month period ended November 30, 2018 (in thousands): Warranty Reserve Balance at February 28, 2018 $ 2,013 Warranty costs incurred (1,674 ) Additions charged to income 1,561 Balance at November 30, 2018 $ 1,900

Debt

Debt	9 Months Ended
	Nov. 30, 2018
Debt [Abstract]
Long-term Debt [Text Block]	Debt The Company's debt consisted of the following for each of the periods presented (in thousands): November 30, 2018 February 28, 2018 2011 Senior Notes $ 125,000 $ 125,000 2008 Senior Notes — 14,286 2017 Revolving Credit Facility 148,000 162,000 Total debt 273,000 301,286 Unamortized debt issuance costs for Senior Notes (288 ) (391 ) Total debt, net 272,712 300,895 Less amount due within one year — (14,286 ) Debt due after one year, net $ 272,712 $ 286,609 On March 31, 2018, the Company made the final principal payment of $14.3 million to fully settle the 2008 Senior Notes on the scheduled maturity date.

Acquisitions

Acquisitions	9 Months Ended
	Nov. 30, 2018
Business Combinations [Abstract]
Business Combination Disclosure [Text Block]	Acquisitions On March 22, 2018, the Company purchased certain assets through a bankruptcy sales process from Lectrus Corporation, a privately-held corporation based in Chattanooga, Tennessee. Lectrus designs and manufactures custom metal enclosures and provides electrical and mechanical integration. The acquisition will complement AZZ's current metal enclosure and switchgear businesses. This acquisition was not significant. Accordingly, disclosures of the purchase price allocation and unaudited pro forma results of operations have not been provided.

Basis of Presentation (Policies

Basis of Presentation (Policies)	9 Months Ended
	Nov. 30, 2018
Accounting Policies [Abstract]
Basis of Presentation	The Company and Basis of Presentation AZZ Inc. (“AZZ”, the “Company”, "our" or “we”) was established in 1956 and incorporated under the laws of the state of Texas. The Company is a global provider of metal coating services, welding solutions, specialty electrical equipment and highly engineered services to the power generation, transmission, distribution, refining and industrial markets. The Company has two distinct operating segments: the Energy segment and the Metal Coatings segment. AZZ Energy is dedicated to delivering safe and reliable transmission of power from generation sources to end customers, and automated weld overlay solutions for corrosion and erosion mitigation to critical infrastructure in the energy markets worldwide. AZZ Metal Coatings is a leading provider of metal finishing solutions for corrosion protection, including hot dip galvanizing to the North American steel fabrication industry. Presentation The accompanying condensed consolidated balance sheet as of February 28, 2018 , which was derived from audited financial statements, and the unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete consolidated financial statements. These financial statements should be read in conjunction with the audited financial statements and related notes for the fiscal year ended February 28, 2018 , included in the Company’s Annual Report on Form 10-K covering such period. Our fiscal year ends on the last day of February and is identified as the fiscal year for the calendar year in which it ends. For example, the fiscal year ended February 28, 2019 is referred to as fiscal 2019. In the opinion of management, the accompanying unaudited consolidated financial statements include all adjustments, consisting only of normal recurring adjustments, which are necessary to present fairly the financial position of the Company as of November 30, 2018 , the results of its operations for the three and nine months ended November 30, 2018 and 2017 , and cash flows for the nine months ended November 30, 2018 and 2017 . These interim results are not necessarily indicative of results for a full year.
New Accounting Pronouncements	Accounting Standards Recently Adopted On March 1, 2018, the Company adopted Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers (Topic 606) and the related amendments ("ASC 606") using the modified retrospective method applied to those contracts which were not completed as of February 28, 2018. Results for operating periods beginning on or after March 1, 2018 are presented under ASC 606, while prior period amounts have not been adjusted and continue to be reported in accordance with the accounting standards in effect for those periods. However, for the three and nine months ended November 30, 2018, the impact of applying ASC 606 as opposed to applying legacy accounting guidance did not result in a significant change to reported revenues or costs of revenues. Accordingly, no reconciliation has been provided to show the difference between applying ASC 606 and legacy guidance for the three and nine months ended November 30, 2018 . In addition, there was no cumulative effect adjustment to the beginning retained earnings on March 1, 2018 related to the adoption. See Note 2 for a description of the Company's accounting policy resulting from the adoption of ASC 606. On March 1, 2018, the Company adopted ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments , which clarifies the presentation and classification of certain cash receipts and cash payments in the statement of cash flows. The adoption did not have a material impact on the Company's consolidated statements of cash flows. Recently Issued Accounting Pronouncements In February 2016, the Financial Accounting Standards Board ("FASB") issued ASU 2016-02, Leases (Topic 842) . Under the new guidance, a lessee will be required to recognize assets and liabilities for all leases with lease terms of more than 12 months. Consistent with current GAAP, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as a finance or operating lease. The Company expects to early adopt this standard in the fourth quarter of fiscal year 2019, which will be retrospectively applied to the beginning of fiscal year 2019. The standard, as subsequently amended, does not require full retrospective adoption, thus periods prior to fiscal year 2019 will not be adjusted and any impacts of transitioning to the new standard will be reflected with a cumulative effect adjustment to the opening balance of retained earnings in the year of adoption. In preparing for the adoption of this standard, the Company is substantially complete in assessing its portfolio of leases for accounting and disclosure purposes. The Company is also progressing with the design of the future lease accounting procedures, policies and related internal controls and with the implementation of lease accounting software. While the Company has not yet completed its evaluation of the financial statement impact of the new lease accounting standard, the Company expects that the adoption will result in a significant increase in assets and liabilities related to operating leases in its consolidated balance sheets. However, the Company does not expect to record a significant cumulative effect adjustment as a result of adopting the standard.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Nov. 30, 2018
Accounting Policies [Abstract]
Revenue Recognition	Revenue recognition The Company determines revenue recognition through the following steps: 1) Identification of the contract with a customer, 2) Identification of the performance obligations in the contract, 3) Determination of the transaction price, 4) Allocation of the transaction price to performance obligations in the contract, and 5) Recognition of revenue when, or as, the Company satisfies a performance obligation Revenue is recognized when control of the promised goods or services is transferred to the Company’s customers, in an amount that reflects the consideration that it expects to be entitled to in exchange for those goods or services. The amount and timing of revenue recognition varies by segment based on the nature of the goods or services provided and the terms and conditions of the customer contract. Energy Segment AZZ's Energy segment is a provider of specialized products and services designed to support industrial, nuclear and electrical applications. Within this segment, the contract is governed by a customer purchase order and an executed product or services agreement. The contract generally specifies the delivery of what constitutes a single performance obligation consisting of either custom built products, custom services, or off-the-shelf products. When the Company does enter into an arrangement with multiple performance obligations, the transaction price is allocated to each performance obligation based on the relative standalone selling prices of the goods or services being provided to the customer and revenue is recognized upon the satisfaction of each performance obligation. The Company combines contracts for revenue recognition purposes that are executed with the same customer within a short timeframe from each other and that purport to be for a single commercial objective. For custom built products, the Company recognizes revenues over time provided that the goods do not have an alternative use to the Company and the Company has an unconditional right to payment for work completed to date plus a reasonable margin. For custom services, which consist of specialized welding and other professional services, the Company recognizes revenues over time as the services are rendered due to the fact that the services enhance a customer owned asset. For off-the-shelf products, which consist of tubing and lighting products, the Company recognizes revenue at a point-in-time upon the transfer of the goods to the customer. For services and custom built products, the Company recognizes revenues over time using a cost-to-cost input measure. This requires the Company to estimate the total contract revenues, costs and margin, which can involve significant management judgment. As a significant change in one or more of these estimates could affect the profitability of the Company’s contracts, management reviews and updates its contract related estimates regularly. The Company recognizes adjustments in estimated margin on contracts under a cumulative catch-up basis and subsequent revenues are recognized using the adjusted estimate. If the estimate of contract margin indicates an anticipated loss on the contract, the Company recognizes the total estimated loss in the period it is identified. Due to the custom nature of the goods and services provided, contracts within the Energy segment are often modified to account for changes in contract specifications and requirements. A contract modification exists when the modification either creates new, or changes the existing, enforceable rights and obligations in the contract. For the Company, most contract modifications are related to goods or services that are not distinct from those in the original contract due to the significant interrelationship or interdependencies between the deliverables. Such modifications are accounted for as if they were part of the original contract. As a result, the transaction price and the measure of progress for the performance obligation to which it relates, is recognized as an adjustment to revenue on a cumulative catch-up basis. In addition to fixed consideration, the Company’s contracts within its Energy segment can include variable consideration, including claims, incentive fees, liquidated damages or other penalties. The Company recognizes revenue for variable consideration when it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur. The Company estimates the amount of revenue to be recognized on variable consideration using the expected value or the most likely amount method, whichever is expected to better predict the amount. Metal Coatings Segment AZZ’s Metal Coatings segment is a provider of hot dip galvanizing, powder coating and other metal coating applications to the steel fabrication industry. Within this segment, the contract is governed by a customer purchase order or work order. The contract generally specifies the delivery of what constitutes a single performance obligation consisting of metal coating services. The Company combines contracts for revenue recognition purposes that are executed with the same customer within a short timeframe from each other and that purport to be for a single commercial objective. The Company recognizes revenue over time as the metal coating is applied to the customer provided material as the process enhances a customer controlled asset. Contract modifications are rare within this segment and most contracts are on a fixed price basis with no variable consideration. Contract Assets and Liabilities The timing of revenue recognition, billings and cash collections results in accounts receivable, contract assets (unbilled receivables), and contract liabilities (customer advances and deposits) on the consolidated balance sheet, primarily related to the Company’s Energy segment. Amounts are billed as work progresses in accordance with agreed upon contractual terms, either at periodic intervals (e.g., weekly or monthly) or upon achievement of contractual milestones. Billing can occur subsequent to revenue recognition, resulting in contract assets. In addition, the Company can receive advances or deposits from its customers, before revenue is recognized, resulting in contract liabilities. These assets and liabilities are reported on the consolidated balance sheet on a contract-by-contract basis at the end of each reporting period. For the nine months ended November 30, 2018 , the Company recognized $20.1 million of revenues from amounts that were included in contract liabilities at February 28, 2018. The Company did not record any revenues for the three or nine months ended November 30, 2018 related to performance obligations satisfied in prior periods. The Company expects to recognize revenues of approximately $13.8 million , $16.1 million , $1.5 million and $1.3 million in fiscal 2019 , 2020 , 2021 and 2022, respectively, related to the $32.7 million balance of contract liabilities as of November 30, 2018 . The increases or decreases in accounts receivable, contract assets and contract liabilities during the three and nine months ended November 30, 2018 were due primarily to normal timing differences between the Company’s performance and customer payments. The Lectrus acquisition described in Note 8 had no impact on contract assets or liabilities as of the date of acquisition. Other No general rights of return exist for customers and the Company establishes provisions for estimated warranties. The Company generally does not sell extended warranties. Revenue is recognized net of applicable sales and other taxes. The Company does not adjust the contract price for the effects of a significant financing component if the Company expects, at contract inception, that the period between when the Company transfers a good or service to a customer and when the customer pays for that good or service will be one year or less, which is generally the case. Sales commissions are deferred and recognized over the same period as the related revenues. Shipping and handling is treated as a fulfillment obligation instead of a separate performance obligation and such costs are expensed as incurred. Disaggregated Revenue Revenue by segment and geography is disclosed in Note 5. In addition, the following table presents disaggregated revenue by customer industry (in thousands): Three Months Ended November 30, Nine Months Ended November 30, 2018 2017 2018 2017 Net sales: Industrial - oil and gas, construction, and general $ 143,710 $ 126,976 $ 415,323 $ 355,895 Transmission and distribution 35,927 45,795 162,033 130,134 Power generation 59,879 35,387 147,183 123,741 Total net sales $ 239,516 $ 208,158 $ 724,539 $ 609,770

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Tables)	9 Months Ended
	Nov. 30, 2018
Accounting Policies [Abstract]
Disaggregation of Revenue [Table Text Block]	Disaggregated Revenue Revenue by segment and geography is disclosed in Note 5. In addition, the following table presents disaggregated revenue by customer industry (in thousands): Three Months Ended November 30, Nine Months Ended November 30, 2018 2017 2018 2017 Net sales: Industrial - oil and gas, construction, and general $ 143,710 $ 126,976 $ 415,323 $ 355,895 Transmission and distribution 35,927 45,795 162,033 130,134 Power generation 59,879 35,387 147,183 123,741 Total net sales $ 239,516 $ 208,158 $ 724,539 $ 609,770

Earnings Per Share (Tables)

Earnings Per Share (Tables)	9 Months Ended
	Nov. 30, 2018
Earnings Per Share [Abstract]
Computation of basic and diluted earnings per share	The following table sets forth the computation of basic and diluted earnings (loss) per share (in thousands, expect per share data): Three Months Ended November 30, Nine Months Ended November 30, 2018 2017 2018 2017 Numerator: Net income (loss) for basic and diluted earnings per common share $ 15,395 $ (166 ) $ 42,357 $ 21,682 Denominator: Denominator for basic earnings per common share–weighted average shares 26,064 25,965 26,022 25,982 Effect of dilutive securities: Employee and director stock awards 87 — 70 67 Denominator for diluted earnings per common share 26,151 25,965 26,092 26,049 Earnings (loss) per share basic and diluted: Basic earnings (loss) per common share $ 0.59 $ (0.01 ) $ 1.63 $ 0.83 Diluted earnings (loss) per common share $ 0.59 $ (0.01 ) $ 1.62 $ 0.83 For the three months ended November 30, 2017, approximately 0.1 million shares related to employee and director stock awards were excluded from the diluted shares outstanding count as the effect was anti-dilutive.

Stock-based Compensation (Table

Stock-based Compensation (Tables)	9 Months Ended
	Nov. 30, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation, Performance Shares Award Unvested Activity [Table Text Block]	non-vested performance share unit award activity for the nine month period ended November 30, 2018 is as follows: Performance Weighted Non-vested balance as of February 28, 2018 70,030 $ 54.59 Granted 46,183 42.00 Vested (3,378 ) 46.65 Forfeited (29,710 ) 49.51 Non-vested balance as of November 30, 2018 83,125 $ 49.74
Restricted Stock Unit Awards Non-Vested	non-vested restricted stock unit award activity for the nine month period ended November 30, 2018 is as follows: Restricted Stock Units Weighted Average Grant Date Fair Value Non-vested balance as of February 28, 2018 109,777 $ 56.62 Granted 84,023 42.01 Vested (37,670 ) 54.63 Forfeited (7,290 ) 55.27 Non-vested balance as of November 30, 2018 148,840 $ 48.94
Stock Appreciation Rights and Option Awards	A summary of the Company’s stock appreciation rights activity for the nine month period ended November 30, 2018 is as follows: SARs Weighted Average Exercise Price Outstanding as of February 28, 2018 148,513 $ 43.29 Granted — — Exercised (47,484 ) 40.84 Forfeited (2,845 ) 43.92 Outstanding as of November 30, 2018 98,184 $ 44.46 Exercisable as of November 30, 2018 98,184 $ 44.46
Share-based compensation expense and related income tax	Share-based compensation expense and related income tax benefits related to all the plans listed above were as follows (in thousands): Nine Months Ended November 30, 2018 2017 Compensation expense $ 3,335 $ 4,810 Income tax benefits $ 700 $ 1,684

Segments (Tables)

Segments (Tables)	9 Months Ended
	Nov. 30, 2018
Segment Reporting Information [Line Items]
Schedule of Segment Reporting Information, by Segment [Table Text Block]	Net sales and operating income by segment for each period were as follows (in thousands): Three Months Ended November 30, Nine Months Ended November 30, 2018 2017 2018 2017 Net sales: Energy $ 132,025 $ 107,021 $ 385,526 $ 317,526 Metal Coatings 107,491 101,137 339,013 292,244 Total net sales $ 239,516 $ 208,158 $ 724,539 $ 609,770 Operating income (loss): Energy $ 11,532 $ (12,103 ) $ 25,763 $ (3,029 ) Metal Coatings 18,321 21,681 65,581 66,332 Corporate (7,084 ) (8,024 ) (27,774 ) (24,339 ) Total operating income $ 22,769 $ 1,554 $ 63,570 $ 38,964
Reconciliation of Assets from Segment to Consolidated [Table Text Block]	Asset balances by segment for each period were as follows (in thousands): November 30, 2018 February 28, 2018 Total assets: Energy $ 585,807 $ 554,866 Metal Coatings 436,873 460,575 Corporate 9,699 12,768 Total $ 1,032,379 $ 1,028,209
Revenue from External Customers by Geographic Areas [Table Text Block]	The following table presents revenues by geographic region for each period (in thousands): Three Months Ended November 30, Nine Months Ended November 30, 2018 2017 2018 2017 Net sales: United States $ 203,788 $ 175,803 $ 605,672 $ 505,023 International 35,728 32,355 118,867 104,747 Total $ 239,516 $ 208,158 $ 724,539 $ 609,770
Long-lived Assets by Geographic Areas [Table Text Block]	The following table presents fixed assets by geographic region for each period (in thousands): November 30, 2018 February 28, 2018 Property, plant and equipment, net: United States $ 186,696 $ 194,418 Canada 16,619 18,254 Other countries 3,775 4,183 Total $ 207,090 $ 216,855

Warranty Reserves (Tables)

Warranty Reserves (Tables)	9 Months Ended
	Nov. 30, 2018
Product Warranties Disclosures [Abstract]
Changes in the warranty reserves	The following table shows the changes in the warranty reserves for the nine month period ended November 30, 2018 (in thousands): Warranty Reserve Balance at February 28, 2018 $ 2,013 Warranty costs incurred (1,674 ) Additions charged to income 1,561 Balance at November 30, 2018 $ 1,900

Debt (Tables)

Debt (Tables)	9 Months Ended
	Nov. 30, 2018
Debt [Abstract]
Schedule of Debt [Table Text Block]	The Company's debt consisted of the following for each of the periods presented (in thousands): November 30, 2018 February 28, 2018 2011 Senior Notes $ 125,000 $ 125,000 2008 Senior Notes — 14,286 2017 Revolving Credit Facility 148,000 162,000 Total debt 273,000 301,286 Unamortized debt issuance costs for Senior Notes (288 ) (391 ) Total debt, net 272,712 300,895 Less amount due within one year — (14,286 ) Debt due after one year, net $ 272,712 $ 286,609 On March 31, 2018, the Company made the final principal payment of $14.3 million to fully settle the 2008 Senior Notes on the scheduled maturity date.

Summary of Significant Accoun_4

Summary of Significant Accounting Policies Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Nov. 30, 2018	Nov. 30, 2017	Nov. 30, 2018	Nov. 30, 2017
Disaggregation of Revenue [Line Items]
Revenue, Net	$ 239,516	$ 208,158	$ 724,539	$ 609,770
Industrial [Member]
Disaggregation of Revenue [Line Items]
Revenue, Net	143,710	126,976	415,323	355,895
Trasmission & Distribution [Member]
Disaggregation of Revenue [Line Items]
Revenue, Net	35,927	45,795	162,033	130,134
Power Generation [Member]
Disaggregation of Revenue [Line Items]
Revenue, Net	$ 59,879	$ 35,387	$ 147,183	$ 123,741

Summary of Significant Accoun_5

Summary of Significant Accounting Policies Revenue Details (Details) - USD ($)	3 Months Ended	9 Months Ended	12 Months Ended
	Feb. 28, 2019	Nov. 30, 2018	Feb. 28, 2022	Feb. 28, 2021	Feb. 28, 2020
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Contract with Customer, Liability, Revenue Recognized		$ 20,100,000
Future Revenues	$ 13,800,000		$ 1,300,000	$ 1,500,000	$ 16,100,000
Revenue, Remaining Performance Obligation		$ 32,700,000

Earnings Per Share (Details)

Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended						9 Months Ended
	Nov. 30, 2018	Aug. 31, 2018	May 31, 2018	Nov. 30, 2017	Aug. 31, 2017	May 31, 2017	Nov. 30, 2018	Nov. 30, 2017
Numerator:
Net income for basic and diluted earnings per common share	$ 15,395	$ 11,244	$ 15,718	$ (166)	$ 9,786	$ 12,062	$ 42,357	$ 21,682
Denominator:
Denominator for basic earnings per common share-weighted average shares (shares)	26,064			25,965			26,022	25,982
Effect of dilutive securities:
Employee and Director stock awards (shares)	87			0			70	67
Denominator for diluted earnings per common share (shares)	26,151			25,965			26,092	26,049
Earnings per share basic and diluted:
Basic earnings per Common share (usd per share)	$ 0.59			$ (0.01)			$ 1.63	$ 0.83
Diluted earnings per common share (usd per share)	$ 0.59			$ (0.01)			$ 1.62	$ 0.83

Stock-based Compensation (Detai

Stock-based Compensation (Details) - Restricted Stock Units (RSUs) [Member]	9 Months Ended
	Nov. 30, 2018$ / sharesshares
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Non-vested balance as of February 28, 2018 | shares	109,777
Granted (shares) | shares	84,023
Vested (shares) | shares	(37,670)
Forfeited (shares) | shares	(7,290)
Non-vested balance as of November 30, 2018 | shares	148,840
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward]
Non-vested balance as of February 28, 2018 | $ / shares	$ 56.62
Granted, Weighted Average Grant Date Fair Value (usd per share) | $ / shares	42.01
Vested, Weighted Average Grant Date Fair Value (usd per share) | $ / shares	54.63
Forfeited, Weighted Average Grant Date Fair Value (usd per share) | $ / shares	55.27
Non-vested balance as of November 30, 2018 | $ / shares	$ 48.94

Stock-based Compensation (Det_2

Stock-based Compensation (Details 1) - Stock Appreciation Rights (SARs) [Member] - $ / shares	9 Months Ended
	Nov. 30, 2018	Feb. 28, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number	98,184	148,513
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price	$ 44.46	$ 43.29
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments, Number of Shares [Roll Forward]
Granted (shares)	0
Exercised (shares)	(47,484)
Forfeited (shares)	(2,845)
Exercisable as of November 30, 2018	98,184
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instrument, Weighted Average Grant Date Fair Value [Roll Forward]
Granted, Weighted Average Exercise Price (usd per share)	$ 0
Exercised, Weighted Average Exercise Price (usd per share)	40.84
Forfeited, Weighted Average Exercise Price (usd per share)	43.92
Exercisable as of November 30, 2018	$ 44.46

Stock-based Compensation (Det_3

Stock-based Compensation (Details 2) - USD ($) $ in Thousands	9 Months Ended
	Nov. 30, 2018	Nov. 30, 2017
Share-based Compensation [Abstract]
Share-based Compensation	$ 3,335	$ 4,810
Share based compensation expense and related income tax benefits
Income tax benefits	$ 700	$ 1,684

Stock-based Compensation (Det_4

Stock-based Compensation (Details Textual)	9 Months Ended
	Nov. 30, 2018USD ($)share_based_compensation_plan$ / sharesshares	Feb. 28, 2018$ / sharesshares
Share Based Compensation (Textual) [Abstract]
Number Of Share-Based Compensation Plans | share_based_compensation_plan	1
Shares authorized (shares)	1,500,000
Share for future issuance (shares)	1,248,775
Unrecognized compensation cost | $	$ 8,000,000
Restricted Stock [Member]
Share Based Compensation (Textual) [Abstract]
Vesting ratably term	3 years
Performance Shares [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number	83,125	70,030
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value | $ / shares	$ 49.74	$ 54.59
Share Based Compensation (Textual) [Abstract]
Vesting ratably term	3 years
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period	46,183
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value | $ / shares	$ 42
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period	(3,378)
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Weighted Average Grant Date Fair Value | $ / shares	$ 46.65
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeited in Period	(29,710)
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeitures, Weighted Average Grant Date Fair Value | $ / shares	$ 49.51
Stock Appreciation Rights (SARs) [Member]
Share Based Compensation (Textual) [Abstract]
Vesting ratably term	3 years
Term for the contract	7 years
Outstanding Average contractual term	2 years 1 month 1 day
Outstanding Aggregate intrinsic value | $	$ 0
Employee Stock [Member]
Share Based Compensation (Textual) [Abstract]
Term of offering under stock purchase plan	24 months
Granted option lower than	85.00%
Restricted common stock under plan | $	$ 25,000
Common stock purchased during period (shares)	5,000
Share-based Compensation Arrangement, By Share-based Payment Award, Common Shares Estimated To Be Issued	73,702

Segments (Details)

Segments (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Nov. 30, 2018	Nov. 30, 2017	Nov. 30, 2018	Nov. 30, 2017	Feb. 28, 2018
Segment Reporting Information [Line Items]
Property, Plant and Equipment, Net	$ 207,090		$ 207,090		$ 216,855
Operations and assets by segment
Net sales	239,516	$ 208,158	724,539	$ 609,770
Operating Income	22,769	1,554	63,570	38,964
Assets	1,032,379		1,032,379		1,028,209
Energy
Operations and assets by segment
Net sales	132,025	107,021	385,526	317,526
Operating Income	11,532	(12,103)	25,763	(3,029)
Assets	585,807		585,807		554,866
Metal Coatings
Operations and assets by segment
Net sales	107,491	101,137	339,013	292,244
Operating Income	18,321	21,681	65,581	66,332
Assets	436,873		436,873		460,575
Corporate
Operations and assets by segment
Operating Income	(7,084)	(8,024)	(27,774)	(24,339)
Corporate
Operations and assets by segment
Assets	9,699		9,699		12,768
UNITED STATES
Segment Reporting Information [Line Items]
Property, Plant and Equipment, Net	186,696		186,696		194,418
Operations and assets by segment
Net sales	203,788	175,803	605,672	505,023
CANADA
Segment Reporting Information [Line Items]
Property, Plant and Equipment, Net	16,619		16,619		18,254
Other Countries [Member]
Segment Reporting Information [Line Items]
Property, Plant and Equipment, Net	3,775		3,775		$ 4,183
International [Member]
Operations and assets by segment
Net sales	$ 35,728	$ 32,355	$ 118,867	$ 104,747

Warranty Reserves (Details)

Warranty Reserves (Details) $ in Thousands	9 Months Ended
	Nov. 30, 2018USD ($)
Movement in Standard Product Warranty Accrual [Roll Forward]
Opening Balance	$ 2,013
Warranty costs incurred	1,674
Closing Balance	1,900
Product Warranty Accrual, Warranties Issued	$ 1,561

Debt (Details)

Debt (Details) - USD ($) $ in Thousands	Nov. 30, 2018	Feb. 28, 2018
Debt Instrument [Line Items]
Long-term Debt	$ 272,712	$ 300,895
Long-term Debt, Gross	273,000	301,286
Unamortized Debt Issuance Expense	(288)	(391)
Debt, Current	0	(14,286)
Long-term Debt, Excluding Current Maturities	272,712	286,609
Senior Notes [Member] | Unsecured Senior Notes Due January 2021 [Member]
Debt Instrument [Line Items]
Long-term Debt	125,000	125,000
Senior Notes [Member] | Unsecured Senior Notes Due March 2012 through March 2018 [Member]
Debt Instrument [Line Items]
Long-term Debt	0	14,286
Line of Credit [Member] | Line of Credit [Member]
Debt Instrument [Line Items]
Long-term Debt	$ 148,000	$ 162,000