Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Feb. 28, 2019 | Apr. 30, 2019 | Aug. 31, 2018 | |
Document and Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Feb. 28, 2019 | ||
Entity Registrant Name | AZZ INC | ||
Entity Central Index Key | 0000008947 | ||
Current Fiscal Year End Date | --02-28 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2019 | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 26,115,389 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 1,381,529,854 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2019 | Feb. 28, 2018 | Feb. 28, 2017 | |
Income Statement [Abstract] | |||
Revenue, Net | $ 927,087 | $ 810,430 | $ 863,538 |
Costs and Expenses | |||
Cost of Sales | 728,466 | 650,121 | 658,206 |
Gross profit | 198,621 | 160,309 | 205,332 |
Selling, General and Administrative | 121,665 | 112,061 | 106,424 |
Operating Income (Loss) | 76,956 | 48,248 | 98,908 |
Interest Expense | 14,971 | 13,860 | 14,732 |
Other Expense (Income) - net | (1,020) | 3,489 | (1,121) |
Income before income taxes | 63,005 | 30,899 | 85,297 |
Income Tax Expense | 11,797 | (14,270) | 24,033 |
Net Income | $ 51,208 | $ 45,169 | $ 61,264 |
Earnings Per Common Share | |||
Basic Earnings Per Share (usd per share) | $ 1.97 | $ 1.74 | $ 2.36 |
Diluted Earnings Per Share (usd per share) | $ 1.96 | $ 1.73 | $ 2.35 |
Weighted average number common shares (shares) | 26,038,000 | 25,970,000 | 25,965,000 |
Weighted average number common shares and potentially dilutive common shares (shares) | 26,107,000 | 26,036,000 | 26,097,000 |
Common Stock, Dividends, Per Share, Declared | $ 0.68 | $ 0.68 | $ 0.64 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2019 | Feb. 28, 2018 | Feb. 28, 2017 | |
Net Income | $ 51,208 | $ 45,169 | $ 61,264 |
Other Comprehensive Income (Loss): | |||
Unrealized Translation Gains (Losses) | (3,478) | 3,928 | 1,520 |
Interest rate swap (net of tax of $29, $29 and $29) | (54) | (54) | (54) |
Other Comprehensive Income (Loss) | (3,532) | 3,874 | 1,466 |
Comprehensive Income | $ 47,676 | $ 49,043 | $ 62,730 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2019 | Feb. 28, 2018 | Feb. 28, 2017 | |
Statement of Comprehensive Income [Abstract] | |||
Interest rate swap, income tax | $ (29) | $ (29) | $ (29) |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) shares in Thousands, $ in Thousands | Feb. 28, 2019 | Feb. 28, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 24,005 | $ 20,853 |
Accounts receivable, net of allowance for doubtful accounts of $2,267 and $569 at February 28, 2019 and 2018, respectively | 144,887 | 141,488 |
Inventories, net | 124,847 | 110,761 |
Contract with Customer, Asset, Net | 75,561 | 51,787 |
Prepaid expenses and other | 9,245 | 4,265 |
Total current assets | 378,545 | 329,154 |
Property, plant, and equipment, net | 210,227 | 216,855 |
Operating Lease, Right-of-Use Asset | 45,870 | 0 |
Goodwill | 323,756 | 321,307 |
Intangibles and other assets | 130,172 | 160,893 |
Total Assets | 1,088,570 | 1,028,209 |
Current Liabilities: | ||
Accounts payable | 53,047 | 54,162 |
Income tax payable | 632 | 144 |
Accrued salaries and wages | 30,395 | 19,011 |
Other accrued liabilities | 17,631 | 19,622 |
Customer advance payment | 481 | 1,816 |
Contract with Customer, Liability | 56,928 | 22,698 |
Operating Lease, Liability, Current | 5,657 | 0 |
Long-term debt due within one year | 0 | 14,286 |
Total Current Liabilities | 164,771 | 131,739 |
Long-term debt due after one year | 240,745 | 286,609 |
Deferred income tax liabilities | 36,623 | 32,962 |
Other Liabilities, Noncurrent | 1,513 | 11,696 |
Operating Lease, Liability, Noncurrent | 41,190 | 0 |
Total liabilities | $ 484,842 | $ 463,006 |
Common Stock, Shares, Issued | 26,115 | 25,959 |
Shareholders' Equity: | ||
Common Stock, $1.00 par value; 100,000 shares authorized; 26,115 and 25,959 shares issued and outstanding at February 28, 2019 and 2018, respectively | $ 26,115 | $ 25,959 |
Capital in excess of par value | 46,141 | 38,446 |
Retained earnings | 560,224 | 526,018 |
Accumulated other comprehensive income (loss) | (28,752) | (25,220) |
Total Shareholders’ Equity | 603,728 | 565,203 |
Total Liabilities and Shareholders’ Equity | $ 1,088,570 | $ 1,028,209 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Feb. 28, 2019 | Feb. 28, 2018 |
Accounts Receivable, Allowance for Doubtful Accounts | $ 2,267 | $ 569 |
Common Stock, Par Value (usd per share) | $ 1 | $ 1 |
Common Stock, Shares Authorized (shares) | 100,000,000 | 100,000,000 |
Common Stock, Shares, Issued | 26,115,000 | 25,959,000 |
Common Stock, Shares, Outstanding | 26,115,000 | 25,959,000 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2019 | Feb. 28, 2018 | Feb. 28, 2017 | |
Cash Flows From Operating Activities: | |||
Net Income | $ 51,208 | $ 45,169 | $ 61,264 |
Adjustments To Reconcile Net Income To Net Cash Provided By Operating Activities: | |||
Depreciation, Amortization and Accretion, Net | 50,245 | 50,526 | 50,357 |
Deferred income taxes | 3,731 | (20,637) | 1,714 |
Share-based compensation expense | 4,659 | 6,121 | 5,870 |
Amortization of deferred debt issuance costs | 541 | 595 | 1,262 |
Provision for doubtful accounts | 2,153 | 3,007 | 48 |
Gain (Loss) on Disposition of Assets | 810 | 10,834 | 6,602 |
Net loss on sale of property, plant & equipment and insurance proceeds | 9 | 765 | 76 |
Effects of changes in operating assets and liabilities, net of acquisitions: | |||
Accounts Receivable | (8,131) | 3,492 | (4,912) |
Inventories | (595) | (9,927) | (13,754) |
Prepaid expenses and other assets | (4,883) | (2,376) | (1,977) |
Net change in contract assets and liabilities | 3,091 | 984 | 13,592 |
Accounts payable | (171) | 1,540 | 1,245 |
Other accrued liabilities and income taxes payable | 12,001 | (11,184) | (10,211) |
Net cash provided by operating activities: | 114,668 | 78,909 | 111,176 |
Cash flows from investing activities: | |||
Proceeds from the sale or insurance settlement of property, plant, and equipment | 1,543 | 458 | 769 |
Payments to Acquire Businesses, Net of Cash Acquired | 8,000 | ||
Purchases of property, plant and equipment | (25,616) | (29,612) | (41,434) |
Net cash used in investing activities: | (32,073) | (73,939) | (63,344) |
Cash flows from financing activities: | |||
Payments on revolving loan | (310,000) | (256,500) | (211,000) |
Proceeds from Lines of Credit | 264,000 | 349,000 | 179,500 |
Proceeds from long-term debt | (14,286) | (63,504) | (23,192) |
Cash dividends paid | (17,718) | (17,678) | (16,645) |
Net cash provided by (used in) financing activities | (78,004) | 3,800 | (76,619) |
Payments for Repurchase of Common Stock | 0 | 7,518 | 5,282 |
Effect of exchange rate changes on cash | (1,439) | 781 | (102) |
Net increase (decrease) in cash and cash equivalents | 3,152 | 9,551 | (28,889) |
Cash and cash equivalents at beginning of year | 20,853 | 11,302 | 40,191 |
Cash and cash equivalents at end of year | 24,005 | 20,853 | 11,302 |
Cash paid during the year for: | |||
Interest | 14,880 | 13,593 | 13,780 |
Income taxes | $ 3,291 | $ 8,701 | $ 19,857 |
Consolidated Statement of Share
Consolidated Statement of Shareholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss) [Member] |
Balance, beginning balance (shares) at Feb. 29, 2016 | 25,874 | ||||
Balance, beginning balance at Feb. 29, 2016 | $ 484,370 | $ 25,874 | $ 35,148 | $ 453,908 | $ (30,560) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock compensation (shares) | 13 | ||||
Share-based compensation | 5,870 | $ 13 | 5,857 | ||
Stock Issued During Period, Shares, Restricted Stock Award, Gross | 25 | ||||
Restricted Stock Units | (580) | $ 25 | (605) | ||
Stock Issued for SARs, Shares | 81 | ||||
Stock Issued for SARs | (241) | $ 81 | (322) | ||
Employee Stock Purchase Plan (shares) | 71 | ||||
Employee Stock Purchase Plan | 2,914 | $ 71 | 2,843 | ||
Stock Repurchased and Retired During Period, Shares | (100) | ||||
Stock Repurchased and Retired During Period, Value | $ (100) | (5,182) | |||
Retirement of treasury shares | 5,282 | ||||
Cash dividend paid | (16,645) | (16,645) | |||
Net income | 61,264 | 61,264 | 0 | ||
Foreign currency translation | 1,520 | 1,520 | |||
Interest rate swap, net of $29,205 of income tax | (54) | (54) | |||
Balance, ending balance (shares) at Feb. 28, 2017 | 25,964 | ||||
Balance, ending 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) | 16 | ||||
Share-based compensation | 6,121 | $ 16 | 6,105 | ||
Stock Issued During Period, Shares, Restricted Stock Award, Gross | 43 | ||||
Restricted Stock Units | (1,213) | $ 43 | (1,256) | ||
Stock Issued for SARs, Shares | 6 | ||||
Stock Issued for SARs | (5) | $ 6 | (11) | ||
Employee Stock Purchase Plan (shares) | 77 | ||||
Employee Stock Purchase Plan | 3,317 | $ 77 | 3,240 | ||
Stock Repurchased and Retired During Period, Shares | (147) | ||||
Stock Repurchased and Retired During Period, Value | $ (147) | (7,371) | |||
Retirement of treasury shares | (7,518) | 0 | |||
Cash dividend paid | (17,678) | (17,678) | |||
Net income | 45,169 | 45,169 | 0 | ||
Foreign currency translation | 3,928 | 3,928 | |||
Interest rate swap, net of $29,205 of income tax | (54) | (54) | |||
Balance, ending balance (shares) at Feb. 28, 2018 | 25,959 | ||||
Balance, ending balance at Feb. 28, 2018 | 565,203 | $ 25,959 | 38,446 | 526,018 | (25,220) |
Cumulative Effect on Retained Earnings, Net of Tax | (716) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock compensation (shares) | 15 | ||||
Share-based compensation | 4,659 | $ 15 | 4,644 | ||
Stock Issued During Period, Shares, Restricted Stock Award, Gross | 31 | ||||
Restricted Stock Units | (552) | $ 31 | (583) | ||
Stock Issued for SARs, Shares | 9 | ||||
Stock Issued for SARs | (21) | $ 9 | (30) | ||
Employee Stock Purchase Plan (shares) | 101 | ||||
Employee Stock Purchase Plan | 3,765 | $ 101 | 3,664 | ||
Cash dividend paid | (17,718) | (17,718) | |||
Net income | 51,208 | 51,208 | |||
Foreign currency translation | (3,478) | (3,478) | |||
Interest rate swap, net of $29,205 of income tax | (54) | (54) | |||
Balance, ending balance (shares) at Feb. 28, 2019 | 26,115 | ||||
Balance, ending balance at Feb. 28, 2019 | $ 603,728 | $ 26,115 | $ 46,141 | $ 560,224 | $ (28,752) |
Consolidated Statement of Sha_2
Consolidated Statement of Shareholders' Equity (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2019 | Feb. 28, 2018 | Feb. 28, 2017 | |
Statement of Stockholders' Equity [Abstract] | |||
Interest rate swap, income tax | $ (29) | $ (29) | $ (29) |
Summary of Significant Accounti
Summary of Significant Accounting Policies (Notes) | 12 Months Ended |
Feb. 28, 2019 | |
Accounting Policies [Abstract] | |
Summary of significant accounting policies | Note 1 – Summary of Significant Accounting Policies Organization AZZ Inc. (the “Company” “AZZ” or “We”) operates primarily in the United States of America and Canada and also has operations in China, Brazil, Poland and the Netherlands. Information about the Company's operations by segment is included in Note 12 to the consolidated financial statements. Basis of consolidation The consolidated financial statements were prepared in accordance with the accounting principles generally accepted in the United States of America and include the accounts of the Company and its wholly owned subsidiaries. All significant inter-company accounts and transactions have been eliminated in consolidation. Use of estimates The preparation of the financial statements in conformity with generally accepted accounting principles in the United States of America ("GAAP") requires management to make estimates and assumptions that affect the amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Concentrations of credit risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash and cash equivalents and trade accounts receivable. The Company maintains cash and cash equivalents with various financial institutions. These financial institutions are located throughout the United States and Canada, as well as Europe, China and Brazil. The Company's policy is designed to limit exposure to any one institution. The Company performs periodic evaluations of the relative credit standing of those financial institutions that are considered in the Company's banking relationships and has not experienced any losses in such accounts. We believe we are not exposed to any significant credit risk related to cash and cash equivalents. Concentrations of credit risk with respect to trade accounts receivable are limited due to the Company’s diversity by virtue of its two operating segments, the number of customers, and the absence of a concentration of trade accounts receivable in a small number of customers. The Company performs continuous evaluations of the collectibility of trade accounts receivable and allowance for doubtful accounts based upon historical losses, economic conditions and customer specific events. After all collection efforts are exhausted and an account is deemed uncollectible, it is written off against the allowance for doubtful accounts. Collateral is usually not required from customers as a condition of sale. 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 revenues recognized over time, the Company generally uses the cost-to-cost method of revenue recognition. Under this approach, the extent of progress towards completion is measured based on the ratio of costs incurred to date versus the total estimated costs upon completion of the project. This requires the Company to estimate the total contract revenues, project 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 sheets, 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 sheets on a contract-by-contract basis at the end of each reporting period. For the year ended February 28, 2019, 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 in fiscal 2019 related to performance obligations satisfied in prior periods. The Company expects to recognize revenues of approximately $52.8 million , $1.8 million , and $2.3 million in fiscal 2020, 2021 and 2022, respectively, related to the $56.9 million balance of contract liabilities as of February 28, 2019. The increases or decreases in accounts receivable, contract assets and contract liabilities during fiscal year 2019 were due primarily to normal timing differences between the Company’s performance and customer payments. The Lectrus acquisition described in Note 15 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 12. In addition, the following table presents disaggregated revenue by customer industry (in thousands): Year Ended February 28, 2019 February 28, 2018 February 28, 2017 Net sales: Industrial - oil and gas, construction, and general $ 526,465 $ 461,945 $ 518,123 Transmission and distribution 212,433 194,503 164,072 Power generation 188,189 153,982 181,343 Total net sales $ 927,087 $ 810,430 $ 863,538 Cash and cash equivalents The Company considers cash and cash equivalents to include cash on hand, deposits with banks and all highly liquid investments with an original maturity of three months or less. Inventories Inventory is stated at the lower of cost or net realizable value. Cost is determined principally using a weighted-average method for the Energy Segment and the first-in-first-out (FIFO) method for the Metal Coatings Segment. The Company evaluates its ending inventories for excess quantities and obsolescence based on forecasted demand within specific time horizons, technological obsolescence, and an assessment of any inventory that is not in sellable condition. Property, plant and equipment Property and equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets as follows: Buildings and structures 10-25 years Machinery and equipment 3-15 years Furniture and fixtures 3-15 years Automotive equipment 3 years Computers and software 3 years Repairs and maintenance are charged to expense as incurred; renewals and betterments that significantly extend the useful life of the asset are capitalized. Amortizable Intangible and Long-lived assets Purchased intangible assets on the consolidated balance sheets are comprised of customer lists, backlogs, engineering drawings and non-compete agreements. Such intangible assets (excluding indefinite-lived intangible assets) are being amortized on a straight-line basis over the estimated useful lives of the assets ranging from two to nineteen years. The Company records impairment losses on long-lived assets, including identifiable intangible assets, when events and circumstances indicate that the assets might be impaired and the undiscounted projected cash flows associated with those assets are less than their carrying amount. In those situations, impairment loss on a long-lived asset is measured based on the excess of the carrying amount of the asset over the asset’s fair value, which is determined using Level 3 fair value inputs. For fiscal year 2019 , 2018 and 2017 , the Company recorded impairment losses of $0.8 million , $10.8 million and $6.6 million respectively, related to the disposition of certain property, plant and equipment. Such losses were recorded within costs of sales and selling, general and administrative in the consolidated statements of income. Goodwill and Other Indefinite-Lived Intangible Assets Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired in a business combination. Goodwill is not subject to amortization but is subject to an annual impairment test during the fourth quarter of each fiscal year, or earlier if indicators of potential impairment exist. The test is calculated using an income approach and market approach, which are Level 3 fair value inputs. Based on the results of its analysis, the Company determines whether an impairment may exist. A significant change in projected cash flows or cost of capital for future years could result in an impairment of goodwill in future years. Variables impacting future cash flows include, but are not limited to, the level of customer demand for and response to products and services we offer to the power generation market, the electrical transmission and distribution markets, the general industrial market and the hot dip galvanizing market; changes in economic conditions of these various markets; raw material and natural gas costs and availability of experienced labor and management to implement our growth strategies. For fiscal years 2019, 2018 and 2017 no goodwill impairment loss was recorded. Other indefinite-lived intangible assets consist of certain tradenames acquired as part of the Powergrid Solutions and Enhanced Powder Coating acquisitions during fiscal year 2018. The Company tests the carrying value of these tradenames during the fourth quarter of each fiscal year, or more frequently when an event occurs or circumstances change that indicates the carrying value may not be recoverable by comparing the asset's fair value to its carrying value. Fair value, using Level 3 inputs, is measured using a relief-from-royalty approach, which assumes the fair value of the tradename is the discounted cash flows of the amount that would be paid had the Company not owned the tradename and instead licensed the tradename from another company. For fiscal 2019 and 2018, no impairment losses related to these indefinite-lived intangible assets were recorded. Debt issuance costs Debt issue costs related to the revolver are deferred within other assets and are amortized using the effective interest rate method over the term of the debt. Debt issue costs related to debt other than the revolver are deferred within total debt due after one year and are amortized using the effective interest rate method over the term of the debt. Income taxes The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined on the basis of the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. The Company recognizes a valuation allowance against net deferred tax assets to the extent that the Company believes these net assets are not more likely than not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. If the Company determines that it would be able to realize its deferred tax assets in the future in excess of their net recorded amount, the Company would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes. As applicable, the Company records uncertain tax positions on the basis of a two-step process whereby (1) the Company determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, the Company recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. The Company currently does not have any unrecognized tax benefits to record related to U.S. federal, state or, foreign tax exposure. The Company is subject to taxation in the U.S. and various state, provincial and local and foreign jurisdictions. With few exceptions, as of February 28, 2019 , the Company is no longer subject to U.S. federal or state examinations by tax authorities for years before fiscal 2016. Financial instruments Fair value is an exit price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. Hierarchy Levels 1, 2, or 3 are terms for the priority of inputs to valuation techniques used to measure fair value. Hierarchy Level 1 inputs are quoted prices in active markets for identical assets or liabilities. Hierarchy Level 2 inputs are inputs other than quoted prices included with Level 1 that are directly or indirectly observable for the asset or liability. Hierarchy Level 3 inputs are inputs that are not observable in the market. The carrying amount of the Company's financial instruments (cash equivalents, accounts receivable, accounts payable, accrued liabilities and debt), excluding the Senior Notes, approximates the fair value of these instruments based upon either their short-term nature or their variable market rate of interest. As of February 28, 2019 and 2018 the fair value of the outstanding Senior Notes, as described in Note 11, was approximately $127.4 million and $133.7 million , respectively. These fair values were determined using the discounted cash flow at the market rate as well as the applicable market interest rates classified as Level 2 inputs. Derivative financial instruments From time to time, the Company uses derivatives to manage interest rate risk. The Company’s policy is to use derivatives for risk management purposes only, which includes maintaining the ratio between the Company’s fixed and floating rate debt obligations that management deems appropriate, and prohibits entering into such contracts for trading purposes. The Company enters into derivatives only with counterparties (primarily financial institutions) which have substantial financial wherewithal to minimize credit risk. The amount of gains or losses from the use of derivative financial instruments has not been and is not expected to be material to the Company’s consolidated financial statements. As of February 28, 2019 , the Company had no derivative financial instruments. Warranty reserves Within other accrued liabilities, a reserve has been established to provide for the estimated future cost of warranties on a portion of the Company’s delivered products. Management periodically reviews the reserves, and adjustments are made accordingly. A provision for warranty on products is made on the basis of the Company’s historical experience and identified warranty issues. Warranties cover such factors as non-conformance to specifications and defects in material and workmanship. The following is a roll-forward of amounts accrued for warranties (in thousands): Balance at February 29, 2016 $ 2,915 Warranty costs incurred (1,947 ) Additions charged to income 1,130 Balance at February 28, 2017 $ 2,098 Warranty costs incurred (2,225 ) Additions charged to income 2,140 Balance at February 28, 2018 $ 2,013 Warranty costs incurred (2,195 ) Additions charged to income 1,933 Balance at February 28, 2019 $ 1,751 Foreign Currency Translation The local currency is the functional currency for the Company’s foreign operations. Related assets and liabilities are translated into United States dollars at exchange rates existing at the balance sheet date, and revenues and expenses are translated at weighted-average exchange rates. The foreign currency translation adjustment is recorded as a separate component of shareholders’ equity and is included in accumulated other comprehensive income (loss). Accruals for Contingent Liabilities The Company is subject to the possibility of various loss contingencies arising in the normal course of business. The amounts the Company may record for estimated claims, such as self-insurance programs, warranty, environmental and other contingent liabilities, requires the Company to make judgments regarding the amount of expenses that will ultimately be incurred. The Company uses past history and experience and other specific circumstances surrounding these claims in evaluating the amount of liability that should be recorded. Due to the inherent limitations in estimating future events, actual amounts paid or transferred may differ from those estimates. Leases The Company is a lessee under various operating leases for facilities and equipment. For such leases, the Company recognizes a right-of-use ("ROU") asset and lease liability on the consolidated balance sheet as of the lease commencement date based on the present value of the future minimum lease payments. An ROU asset represents the Company's right to use an underlying asset during the lease term and a lease liability represents the Company's obligation to make lease payments. However, for short-term leases with an initial term of twelve months or less that do not contain an option to purchase that is likely to be exercised, the Company does not record ROU assets or lease liabilities on the consolidated balance sheet. The Company's uses its incremental borrowing rate to determine the present value of future payments unless the implicit rate in the lease is readily determinable. In determining the future minimum lease payments, the Company incorporates options to extend or terminate the lease when it is reasonably certain that such options will be exercised. The ROU asset includes any initial direct costs incurred and is recorded net of any lease incentives received. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term as the ROU asset is amortized and the lease liability is accreted. For facilities leases, the Company accounts for lease and non-lease components on a combined basis, while for equipment leases, the lease and non-lease components are accounted for separately. Some of the Company's lease agreements may include rental payments that adjust periodically for inflation or are based on an index rate which are included as variable lease payments. The Company's lease agreements do not contain any material residual value guarantees or material restrictive covenants. Accounting Standards Recently Adopted During the fourth quarter of fiscal 2019, effective March 1, 2018, the Company adopted ASU 2016-02, Leases (Topic 842) using a modified retrospective approach as of the period of adoption. Periods prior to the adoption continue to be presented under legacy guidance and there was no cumulative effect adjustment to beginning retained earnings on the March 1, 2018 adoption date. On the date of adoption, the Company recorded operating lease right of use assets of $42.1 million and lease liabilities of $42.8 million to reflect the Company's portfolio of operating leases, which were previously unrecorded under legacy accounting guidance. However, the adoption did not have any impact on the Company's consolidated statements of income or cash flows. The Company has elected the package of practical expedients permitted under the transition guidance within the new standard, which among several other items, allows the Company to carry-forward the historical lease classification from legacy guidance for leases that existed on the date of adoption. 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. The cumulative effect of initially applying ASC 606 was recorded as an adjustment to the opening balance of retained earnings, which impacted the consolidated balance sheet as follows: Balance Sheet February 28, 2018 ASC 606 Adjustments March 1, 2018 Assets Inventories $ 110,761 $ 7,664 $ 118,425 Liabilities and shareholders' equity Contract liabilities 22,698 6,948 29,646 Retained Earnings 526,018 716 526,734 During the preparation of the consolidated financial statements for the year ended February 28, 2019, the Company identified an error related to the adoption of ASC 606. This impact was recorded as an out-of-period adjustment during the fourth quarter of fiscal year 2019, which increased net sales by $3.5 million, cost of good sold by $2.4 million and net income by $1.0 million. The disclosures above show the impact of this adjustment as of the adoption date on March 1, 2018. Management considered the impact on the previously issued financial statements and concluded that the adjustments were not material. The adoption of ASC 606 had the following impact on the consolidated balance sheets and consolidated statements of income as of and for the fiscal year ended February 28, 2019: Balance Sheet As Reported Balance Excluding ASC 606 Effects Change Assets Inventories $ 124,847 $ 119,627 $ 5,220 Liabilities and shareholders' equity Contract liabilities 56,928 53,444 3,484 Consolidated Statements of Income As Reported Balance Excluding ASC 606 Effects Change Net sales $ 927,087 $ 923,623 $ 3,464 Cost of goods sold 728,466 726,022 2,444 Gross profit 198,621 197,601 1,020 Operating income 76,956 75,936 1,020 Recently Issued Accounting Pronouncements There are no recently issued accounting pronouncements outstanding that are likely to have a material impact on the Company's consolidated financial statements. |
Inventories (Notes)
Inventories (Notes) | 12 Months Ended |
Feb. 28, 2019 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories, net consisted of the following (in thousands): February 28, 2019 February 28, 2018 Raw materials $ 94,410 $ 98,475 Work-in-process 19,067 2,544 Finished goods 11,370 9,742 $ 124,847 $ 110,761 |
Property, Plant and Equipment (
Property, Plant and Equipment (Notes) | 12 Months Ended |
Feb. 28, 2019 | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment Disclosure [Text Block] | Property, Plant and Equipment Property, plant and equipment consisted of the following (in thousands): February 28, 2019 February 28, 2018 Land $ 21,677 $ 22,445 Building and structures 156,447 152,191 Machinery and equipment 245,588 234,071 Furniture, fixtures, software and computers 27,075 25,316 Automotive equipment 3,766 3,432 Construction in progress 13,065 13,977 467,618 451,432 Less accumulated depreciation (257,391 ) (234,577 ) Net property, plant, and equipment $ 210,227 $ 216,855 Depreciation expense was $33.2 million , $33.4 million , and $33.4 million for fiscal 2019 , 2018 , and 2017 , respectively. |
Other Accrued Liabilities (Note
Other Accrued Liabilities (Notes) | 12 Months Ended |
Feb. 28, 2019 | |
Other Liabilities Disclosure [Abstract] | |
Other accrued liabilities | Other Accrued Liabilities Other accrued liabilities consisted of the following (in thousands): February 28, 2019 February 28, 2018 Accrued interest $ 1,196 $ 1,649 Accrued warranty 1,751 2,013 Commissions 3,370 2,801 Personnel expenses 6,282 6,493 Group medical insurance 2,024 1,905 Other 3,008 4,761 Total $ 17,631 $ 19,622 |
Restructuring and Other Related
Restructuring and Other Related Costs (Notes) | 12 Months Ended |
Feb. 28, 2019 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Activities Disclosure [Text Block] | Restructuring and Other Related Costs During fiscal year 2019, as part of the Company's ongoing efforts to eliminate redundancies in its Metal Coatings segment, the Company consolidated two galvanizing facilities located in the Gulf Coast region of the United States. As a result of the consolidation, the Company recognized restructuring and other related costs of $1.3 million in fiscal 2019, comprised of $0.8 million for fixed asset impairments and $0.5 million for employee severance and other disposal costs. All costs were recognized within cost of sales in the consolidated statement of income. During fiscal year 2017, the Company undertook a review of its operations to optimize the financial performance of its operating assets. As a result, the Company recognized $7.9 million of restructuring and other related charges in fiscal 2017. Fixed asset impairment and other charges of $6.6 million were recorded to cost of sales in the consolidated statement of income related to the disposition of certain fixed assets within the Metal Coatings segment as part of the closing and conversion of various plants. The Company also recorded restructuring charges of $1.3 million within selling, general and administrative expense for costs related to employee severance associated with changes to improve management efficiency in the Energy and Metal Coatings segments. The following table provides a summary of the restructuring activities and related liabilities recorded within accrued liabilities (in thousands): Balance at February 29, 2016 $ 61 Restructuring and other related costs 7,862 Non-cash adjustments (6,602 ) Cash payments (1,014 ) Balance at February 28, 2017 $ 307 Restructuring and other related costs — Cash payments (307 ) Balance at February 28, 2018 $ — Restructuring and other related costs 1,301 Non-cash adjustments (810 ) Cash payments (491 ) Balance at February 28, 2019 $ — |
Employee Benefit Plans (Notes)
Employee Benefit Plans (Notes) | 12 Months Ended |
Feb. 28, 2019 | |
Postemployment Benefits [Abstract] | |
Employee benefit plans | Employee Benefit Plans 401(k) Retirement Plan The Company has a 401(k) retirement plan covering substantially all of its employees. Company contributions to the 401(k) retirement plan were $5.0 million, $4.8 million, and $4.5 million for fiscal 2019 , 2018 , and 2017 , respectively. Multiemployer Pension Plans In addition to the Company's 401(k) retirement plan, the Company participates in a number of multiemployer defined benefit pension plans for employees who are covered by collective bargaining agreements. The Company is not aware of any significant future obligations or funding requirements related to these plans other than the ongoing contributions that are paid as hours are worked by plan participants. However, the risks of participating in multiemployer pension plans are different from those in single-employer plans in that (i) assets contributed to the plan by one employer may be used to provide benefits to employees or former employees of other participating employers; (ii) if a participating employer stops contributing to the plan, the unfunded obligations of the plan may be required to be assumed by the remaining participating employers and (iii) if the Company chooses to stop participating in a multiemployer pension plan, it may be required to pay the plan a withdrawal amount based on the underfunded status of the plan. The following table outlines the Company's participation in multiemployer pension plans considered to be individually significant (dollar amounts in thousands): EIN/Pension Plan Number Pension Protection Act Reported Status (1) FIP/RP Status (3) Company Contributions (4) Surcharge Imposed (5) Expiration Date of Collective Bargaining Agreements Year Ended Pension Fund 2019 (2) 2018 February 28, 2019 February 28, 2018 February 28, 2017 Boilermaker-Blacksmith National Pension Trust EIN:48-6168020 Endangered Endangered Implemented $ 5,651 $ 4,070 $ 7,359 No Various through 12/31/2019 Contributions to other multiemployer pension plans 627 470 736 Total contributions $ 6,278 $ 4,540 $ 8,095 (1) The most recent Pension Protection Act zone status available for fiscal 2019 and 2018 is for the plan’s year-end as of December 31, 2017 and 2016, respectively. The zone status is based on information that the Company received from the plan and is certified by the plan’s actuary. A plan is generally classified in critical status if a funding deficiency is projected within four years or five years, depending on other criteria. A plan in critical status is classified in critical and declining status if it is projected to become insolvent in the next 15 or 20 years, depending on other criteria. A plan is classified in endangered status if its funded percentage is less than 80% or a funding deficiency is projected within seven years. If the plan satisfies both of these triggers, it is classified in seriously endangered status. A plan not classified in any other status is classified in the green zone. As of the date the financial statements were issued, Form 5500, which is filed by employee benefit plans to satisfy annual reporting requirements under the Employee Retirement Income Security Act and under the Internal Revenue Code, was not available for the plan year ended in 2018. (2) In April 2019, the Boilermaker-Blacksmith National Pension Trust disclosed that the plan will be classified in critical status commencing for the plan year beginning January 1, 2019 because there is a projected funding deficiency in the plan year ending December 31, 2028. (3) The “FIP/RP Status” column indicates plans for which a Funding Improvement Plan (“FIP”) or a Rehabilitation Plan (“RP”) has been implemented. (4) For the multiemployer pension plan considered to be individually significant, the Company was not listed in the Form 5500 as providing more than 5% of the total contributions for plan years ending December 31, 2017 and 2016. (5) A multiemployer pension plan that has been certified as endangered, seriously endangered or critical may begin to levy a statutory surcharge on contribution rates. Once authorized, the surcharge is at the rate of 5% for the first 12 months and 10% for any periods thereafter. Contributing employers, however, may eliminate the surcharge by entering into a collective bargaining agreement that meets the requirements of the applicable FIP or RP. |
Income Taxes (Notes)
Income Taxes (Notes) | 12 Months Ended |
Feb. 28, 2019 | |
Income Tax Disclosure [Abstract] | |
Income taxes | Income Taxes The provision for income taxes consists of (in thousands): Year Ended February 28, 2019 February 28, 2018 February 28, 2017 Income before income taxes: Domestic $ 48,261 $ 24,282 $ 74,972 Foreign 14,744 6,617 10,325 Income before income taxes $ 63,005 $ 30,899 $ 85,297 Current provision (benefit): Federal $ 4,251 $ 3,445 $ 18,688 Foreign 2,829 1,958 2,751 State and local 986 964 1,290 Total current provision for income taxes $ 8,066 $ 6,367 $ 22,729 Deferred provision (benefit): Federal $ 2,970 $ (20,220 ) $ 2,486 Foreign 539 100 (189 ) State and local 222 (517 ) (993 ) Total deferred provision for (benefit from) income taxes $ 3,731 $ (20,637 ) $ 1,304 Total provision for (benefit from) income taxes $ 11,797 $ (14,270 ) $ 24,033 In general, it is the Company's practice and intention to reinvest the earnings of its non-U.S. subsidiaries in those operations. Generally, such amounts become subject to foreign withholding tax upon the remittance of dividends and under certain other circumstances. The expense recognized in fiscal year 2018 related to the one-time tax on the mandatory deemed repatriation of foreign earnings was $1.4 million of which the Company has elected to pay the one-time tax evenly over a period of eight years with seven years remaining. We continue to reinvest cash in foreign jurisdictions and have not recorded the effects of any applicable foreign withholding tax. The U.S. Tax Cuts and Jobs Act of 2017 (the “U.S. Tax Act”) requires complex computations to be performed that were not previously required by U.S. tax law, significant judgments to be made in interpretation of the provisions of the U.S. Tax Act, significant estimates in calculations, and the preparation and analysis of information not previously relevant. The U.S. Treasury Department, the IRS, and other standard-setting bodies will continue to interpret or issue guidance on how provisions of the U.S. Tax Act will be applied or otherwise administered. As future guidance is issued, we may make adjustments to amounts that we have previously recorded that may materially impact our financial statements in the period in which the adjustments are made. During the fourth quarter of fiscal 2019, the Company completed its assessment of the Tax Act under SAB 118, resulting in additional benefit of $1.1 million resulting from revised estimates of the mandatory deemed repatriation of foreign earnings, foreign tax credits, and bonus depreciation elections based on the finalization of our 2017 US federal income tax return. The change in bonus depreciation elections and other temporary return to provisions items resulted in $0.8 million benefit related to the finalization of the remeasurement of deferred tax assets and liabilities. The finalization of foreign earnings and profits and foreign tax credits resulted in a $0.3 million benefit. A reconciliation from the federal statutory income tax rate to the effective income tax rate is as follows: Year Ended February 28, 2019 February 28, 2018 February 28, 2017 Statutory federal income tax rate 21.0 % 32.7 % 35.0 % Permanent differences 0.5 1.6 0.7 State income taxes, net of federal income tax benefit 0.4 0.4 0.4 Benefit of Section 199 of the Code, manufacturing deduction — (2.2 ) (2.3 ) Valuation allowance (0.7 ) — — Stock compensation 0.5 (0.5 ) (1.8 ) Tax credits (4.1 ) (7.7 ) (3.1 ) Foreign tax rate differential 1.1 (0.4 ) (0.8 ) Deferred tax remeasurements — (78.9 ) — Transition tax — 8.6 — Other — 0.2 0.1 Effective income tax rate 18.7 % (46.2 )% 28.2 % Deferred federal and state income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial accounting purposes and the amounts used for income tax purposes. Significant components of the Company’s net deferred income tax liability are as follows (in thousands): February 28, 2019 February 28, 2018 Deferred income tax assets: Employee related items $ 4,177 $ 4,532 Inventories 758 816 Accrued warranty 369 432 Accounts receivable (2,092 ) 299 Net operating loss carry forward 7,173 5,067 10,385 11,146 Less: valuation allowance (3,015 ) (1,558 ) Total deferred income tax assets 7,370 9,588 Deferred income tax liabilities: Depreciation methods and property basis differences (19,066 ) (17,955 ) Other assets and tax-deductible goodwill (24,927 ) (24,537 ) Total deferred income tax liabilities (43,993 ) (42,492 ) Net deferred income tax liabilities $ (36,623 ) $ (32,904 ) The following table summarizes the Net operating loss (NOL) carryforward (in thousands): February 28, 2019 February 28, 2018 Federal $ — $ — State $ 6,352 $ 5,067 Foreign $ 821 $ — As of February 28, 2019 , the Company had pretax state NOL carry-forwards of $97.7 million which, if unused, will begin to expire in 2025. As of fiscal year end 2019 and 2018 , a portion of the Company's deferred tax assets were the result of state and foreign jurisdiction NOL carry-forwards. The Company believes that it is more likely than not that the benefit from certain state NOL carry forwards will not be realized. In recognition of this risk, the Company has provided a valuation allowance of $3.0 million and $1.6 million as of fiscal year end 2019 and 2018 , respectively. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Notes) | 12 Months Ended |
Feb. 28, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and intangible assets | Goodwill and Intangible Assets Goodwill and indefinite-lived intangible assets are not amortized but are subject to annual impairment tests. Other intangible assets are amortized over their estimated useful lives. Changes in goodwill by segment for fiscal year 2019 and 2018 are as follows (in thousands): Segment February 28, 2018 Acquisitions Foreign February 28, 2019 Metal Coatings $ 117,232 $ 73 $ (614 ) $ 116,691 Energy 204,075 2,990 — 207,065 Total $ 321,307 $ 3,063 $ (614 ) $ 323,756 Segment February 28, 2017 Acquisitions Foreign February 28, 2018 Metal Coatings $ 109,980 $ 6,590 $ 662 $ 117,232 Energy 196,599 7,476 — 204,075 Total $ 306,579 $ 14,066 $ 662 $ 321,307 The Company completes its annual impairment analysis of goodwill on December 31st of each year. As a result, the Company determined that there was no impairment of goodwill. Amortizable intangible assets consisted of the following (in thousands): February 28, 2019 February 28, 2018 Customer related intangibles $ 191,460 $ 194,712 Non-compete agreements 8,546 7,952 Trademarks 4,569 4,569 Technology 7,400 7,400 Engineering drawings 24,600 24,600 Backlog 7,600 7,600 Gross intangible assets 244,175 246,833 Less accumulated amortization (122,199 ) (105,642 ) Total, net $ 121,976 $ 141,191 The Company recorded amortization expense of $17.0 million, $17.1 million and $16.9 million for fiscal 2019 , 2018 and 2017 , respectively, related to the amortizable intangible assets listed above. In addition to its amortizable intangible assets, the Company has recorded indefinite-lived intangible assets of $3.4 million and $2.7 million on the consolidated balance sheets at February 28, 2019 and 2018, respectively, related to certain tradenames acquired as part of business acquisitions in fiscal 2018 and fiscal 2019. These indefinite-lived intangible assets are not amortized, but are assessed for impairment annually or whenever an impairment may be indicated. During fiscal 2019, the Company performed an annual review of its indefinite-lived intangibles and no impairment was indicated. The estimated amortization expense for the five succeeding fiscal years and thereafter is as follows (in thousands): Fiscal year: Amortization Expense 2020 $ 16,393 2021 16,227 2022 14,142 2023 13,058 2024 11,121 Thereafter 51,035 Total $ 121,976 |
Earnings Per Share (Notes)
Earnings Per Share (Notes) | 12 Months Ended |
Feb. 28, 2019 | |
Earnings Per Share [Abstract] | |
Earnings per share | Earnings Per Share Basic earnings per share is based on the weighted average number of shares outstanding during each year. Diluted earnings per share were similarly computed but have been adjusted for the dilutive effect of the weighted average number of restricted stock units, performance share units and stock appreciation rights outstanding. The following table sets forth the computation of basic and diluted earnings per share (in thousands, except per share data): Year Ended February 28, 2019 February 28, 2018 February 28, 2017 Numerator: Net income for basic and diluted earnings per common share $ 51,208 $ 45,169 $ 61,264 Denominator: Denominator for basic earnings per common share–weighted average shares 26,038 25,970 25,965 Effect of dilutive securities: Employee and director stock awards 69 66 132 Denominator for diluted earnings per common share 26,107 26,036 26,097 Earnings per share basic and diluted: Basic earnings per common share $ 1.97 $ 1.74 $ 2.36 Diluted earnings per common share $ 1.96 $ 1.73 $ 2.35 For fiscal 2019 , approximately 0.1 million stock appreciation rights were excluded from the computation of diluted earnings per share as their effect would have been anti-dilutive. For fiscal 2018 and 2017 , the Company had no stock appreciation rights that were excluded from the computation of diluted earnings per share. |
Stock Compensation (Notes)
Stock Compensation (Notes) | 12 Months Ended |
Feb. 28, 2019 | |
Share-based Compensation [Abstract] | |
Stock compensation | Share-based Compensation The Company has two share-based compensation plans, the 2014 Long Term Incentive Plan (the "2014 Plan") and the Amended and Restated 2005 Long Term Incentive Plan (the “2005 Plan”). The 2014 Plan provides for broad-based equity grants to employees, including executive officers, and members of the board of directors and permits the granting of restricted shares, restricted stock units, performance awards, stock appreciation rights and other stock-based awards. The maximum number of shares that may be issued under the 2014 Plan is 1.5 million shares and, as of February 28, 2019 , the Company had approximately 1.2 million shares reserved for future issuance under this plan. The 2005 Plan permitted the granting of stock appreciation rights and other equity-based awards to certain employees. This plan was terminated upon the effective date of the 2014 Plan and no future grants may be made under the 2005 Plan. However, there were stock appreciation rights that were granted under the 2005 Plan prior to its termination that remain outstanding, and if exercised, such awards will be settled from the balance of shares available for issuance under the 2005 Plan. As of February 28, 2019 , there were 0.1 million shares available for issuance under the 2005 Plan. The 2005 Plan will be formally retired when all remaining outstanding stock appreciation rights are exercised, forfeited or expire. All outstanding stock appreciation rights will expire on or before March 1, 2021. Restricted Stock Unit Awards Restricted stock unit awards are valued at the market price of the Company's common stock on the grant date. Awards issued prior to fiscal 2015 generally have a three year cliff vesting schedule and awards issued subsequent to fiscal 2015 generally vest ratably over a period of three years but these awards may vest early in accordance with the Plan’s accelerated vesting provisions. The activity for non-vested restricted stock unit awards for the year ended February 28, 2019 is as follows: Restricted Weighted Non-Vested Balance as of February 28, 2018 109,777 $ 56.62 Granted 84,895 42.05 Vested (38,733 ) 54.53 Forfeited (9,407 ) 53.46 Non-Vested Balance as of February 28, 2019 146,532 $ 48.93 The total fair value of restricted stock units vested during fiscal years 2019 , 2018 , and 2017 was $2.1 million, $3.0 million and $1.6 million, respectively. For fiscal years 2019 , 2018 and 2017 , there were 146,532 , 109,777 and 134,547 , respectively, of non-vested restricted stock units outstanding with weighted average grant date fair values of $48.93 , $56.62 and $51.10 , respectively. Performance Share Unit Awards The Company also grants performance share unit awards to certain employees. These awards have a three year performance vesting cycle and may vest in varying amounts contingent on whether various performance and market conditions are satisfied. Specifically, the vesting of these awards is subject to the Company’s degree of achievement of a target annual average adjusted return on assets and total shareholder return, both of which may be relative to the performance of a defined industry peer group. The Company estimates the grant date fair value of these awards using a Monte Carlo simulation. The activity in our non-vested performance stock unit awards for the year ended February 28, 2019 is as follows: Performance Stock Units Weighted Average Grant Date Fair Value 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 February 28, 2019 83,125 $ 49.74 Stock Appreciation Rights Stock appreciation rights awards ("SARs") are granted with an exercise price equal to the market value of the Company's common stock on the date of grant. These awards generally have a contractual term of 7 years and vest ratably over a period of 3 years although some may vest immediately on issuance. These awards are valued using the Black-Scholes option pricing model. The Company did not grant any SARs in fiscal year 2019 , 2018 or 2017 . A summary of the Company’s stock appreciation rights awards activity is as follows: Year Ended February 28, 2019 February 28, 2018 February 28, 2017 SARs Weighted Average Exercise Price SARs Weighted Average Exercise Price SARs Weighted Average Exercise Price Outstanding at beginning of year 148,513 $ 43.29 170,139 $ 42.02 312,748 $ 34.23 Granted — — — — — — Exercised (47,484 ) 40.84 (19,481 ) 31.94 (141,983 ) 24.85 Forfeited (2,845 ) 43.92 (2,145 ) 45.36 (626 ) 43.92 Outstanding at end of year 98,184 $ 44.46 148,513 $ 43.29 170,139 $ 42.02 Exercisable at end of year 98,184 $ 44.46 148,513 $ 43.29 126,975 $ 41.27 The average remaining contractual term for both outstanding and exercisable stock appreciation rights as of February 28, 2019 was 1.84 years, with an aggregate intrinsic value of $0.2 million . The following table summarizes additional information about stock appreciation rights outstanding at February 28, 2019 . Range of Total Average Weighted SARs Weighted $39.65 950 1.52 $ 39.65 950 $ 39.65 $43.92 54,510 2.01 $ 43.92 54,510 $ 43.92 $45.26 40,000 1.68 $ 45.26 40,000 $ 45.26 $45.36 2,724 1.00 $ 45.36 2,724 $ 45.36 $39.65 - $45.36 98,184 1.84 $ 44.46 98,184 $ 44.46 Directors Grants The Company granted each of its independent directors a total of 1,823 , 2,040 and 1,641 shares of its common stock during fiscal years 2019 , 2018 and 2017 , respectively. These common stock grants were valued at $54.85 , $49.00 and $60.94 per share for fiscal years 2019 , 2018 and 2017 , respectively, which was the market price of the Company's common stock on the respective grant dates. 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. Share-based compensation expense and related income tax benefits related to all the plans listed above were as follows (in thousands): Year Ended February 28, 2019 February 28, 2018 February 28, 2017 Compensation expense $ 4,659 $ 6,121 $ 5,870 Income tax benefits $ 978 $ 2,122 $ 2,055 Unrecognized compensation cost related to all the above at February 28, 2019 totaled $6.1 million. These costs are expected to be recognized over a weighted period of 1.71 years. The actual tax benefit realized for tax deductions from share-based compensation during each of these fiscal years totaled $(0.3) million , $0.2 million and $1.5 million , respectively. The Company’s policy is to issue shares required under these plans from the Company’s authorized but unissued shares. The Company has no formal or informal plan to repurchase shares on the open market to satisfy these requirements. |
Debt (Notes)
Debt (Notes) | 12 Months Ended |
Feb. 28, 2019 | |
Debt Disclosure [Abstract] | |
Long-term debt | Debt Following is a summary of debt (in thousands): February 28, 2019 February 28, 2018 2017 Revolving Line of Credit $ 116,000 $ 162,000 2011 Senior Notes 125,000 125,000 2008 Senior Notes — 14,286 Total debt 241,000 301,286 Unamortized debt issuance costs (255 ) (391 ) Total debt, net 240,745 300,895 Less amount due within one year — (14,286 ) Debt due after one year, net $ 240,745 $ 286,609 2017 Revolving Credit Facility On March 27, 2013, the Company entered into a credit agreement (the “Credit Agreement”) with Bank of America and other lenders. The Credit Agreement provided for a $75.0 million term facility and a $225.0 million revolving credit facility that included a $75.0 million “accordion” feature. The Credit Agreement is used to provide for working capital needs, capital improvements, dividends, future acquisitions and letter of credit needs. On March 21, 2017, the Company executed the Amended and Restated Credit Agreement (the “2017 Credit Agreement”) with Bank of America and other lenders. The 2017 Credit Agreement amended the Credit Agreement by the following: (i) extending the maturity date until March 21, 2022, (ii) providing for a senior revolving credit facility in a principal amount of up to $450 million , with an additional $150 million accordion, (iii) including a $75 million sublimit for the issuance of standby and commercial letters of credit, (iv) including a $30 million sublimit for swing line loans, (v) restricting indebtedness incurred in respect of capital leases, synthetic lease obligations and purchase money obligations not to exceed $20 million , (vi) restricting investments in any foreign subsidiaries not to exceed $50 million in the aggregate, and (vii) including various financial covenants and certain restricted payments relating to dividends and share repurchases as specifically set forth in the 2017 Credit Agreement. The balance due on the $75.0 million term facility under the previous Credit Agreement was paid in full as a result of the execution of the 2017 Credit Agreement. The financial covenants, as defined in the 2017 Credit Agreement, require the Company to maintain on a consolidated basis a Leverage Ratio not to exceed 3.25 :1.0 and an Interest Coverage Ratio of at least 3.00 :1.0. The 2017 Credit Agreement will be used to finance working capital needs, capital improvements, dividends, future acquisitions, letter of credit needs and share repurchases. Interest rates for borrowings under the 2017 Credit Agreement are based on either a Eurodollar Rate or a Base Rate plus a margin ranging from 0.875% to 1.875% depending on our Leverage Ratio (as defined in the 2017 Credit Agreement). The Eurodollar Rate is defined as LIBOR for a term equivalent to the borrowing term (or other similar interbank rates if LIBOR is unavailable). The Base Rate is defined as the highest of the applicable Fed Funds rate plus 0.50% , the Prime rate, or the Eurodollar Rate plus 1.0% at the time of borrowing. The 2017 Credit Agreement also carries a Commitment Fee for the unfunded portion ranging from 0 .175% to 0 .30% per annum, depending on our Leverage Ratio. The effective interest rate was 4.06% as of February 28, 2019 . As of February 28, 2019 , we had $116.0 million of outstanding debt against the revolving credit facility and letters of credit outstanding in the amount of $18.7 million , which left approximately $315.3 million of additional credit available under the 2017 Credit Agreement. 2011 Senior Notes On January 21, 2011, the Company entered into a Note Purchase Agreement (the “2011 Agreement”), pursuant to which the Company issued $125.0 million aggregate principal amount of its 5.42% unsecured Senior Notes (the “2011 Notes”), through a private placement (the “2011 Note Offering”). Amounts under the agreement are due in a balloon payment on the January 2021 maturity date. Pursuant to the 2011 Agreement, the Company's payment obligations with respect to the 2011 Notes may be accelerated under certain circumstances. The 2011 Notes contain various financial covenants requiring the Company, among other things, to a) maintain on a consolidated basis net worth equal to at least the sum of $116.9 million plus 50.0% of future net income; b) maintain a ratio of indebtedness to EBITDA (as defined in Note Purchase Agreement) not to exceed 3.25 :1.00; c) maintain on a consolidated basis a Fixed Charge Coverage Ratio (as defined in the Note Purchase Agreement) of at least 2.0 :1.0; d) not at any time permit the aggregate amount of all Priority Indebtedness (as defined in the Note Purchase Agreement) to exceed 10.0% of Consolidated Net Worth (as defined in the Note Purchase Agreement). 2008 Senior Notes On March 31, 2008, the Company entered into a Note Purchase Agreement (the “Note Purchase Agreement”) pursuant to which the Company issued $100.0 million aggregate principal amount of its 6.24% unsecured Senior Notes (the “2008 Notes”) through a private placement (the “2008 Note Offering”). Amounts were due under the Agreement in seven annual installments of $14.3 million commencing in March of 2012 through the March 2018 maturity date. 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. As of February 28, 2019 , the Company was in compliance with all of its debt covenants. Maturities of debt are as follows (in thousands): Fiscal year: Future Debt Maturities 2020 $ — 2021 125,000 2022 — 2023 116,000 2024 — Thereafter — Total $ 241,000 |
Operating segments (Notes)
Operating segments (Notes) | 12 Months Ended |
Feb. 28, 2019 | |
Segment Reporting [Abstract] | |
Operating segments | Operating Segments Segment Information Information about segments during the periods presented were as follows (in thousands): Year Ended February 28, 2019 February 28, 2018 February 28, 2017 Net sales: Energy $ 486,823 $ 421,033 $ 488,002 Metal Coatings 440,264 389,397 375,536 Total net sales $ 927,087 $ 810,430 $ 863,538 Operating income (loss): Energy $ 31,332 $ (1,766 ) $ 52,577 Metal Coatings 83,591 84,332 79,033 Corporate (37,967 ) (34,318 ) (32,702 ) Total operating income $ 76,956 $ 48,248 $ 98,908 Year Ended February 28, 2019 February 28, 2018 February 28, 2017 Depreciation and amortization: Energy $ 19,405 $ 19,996 $ 19,624 Metal Coatings 29,124 28,617 28,650 Corporate 1,716 1,913 2,083 Total $ 50,245 $ 50,526 $ 50,357 Year Ended February 28, 2019 February 28, 2018 February 28, 2017 Expenditures for acquisitions, net of cash, and property, plant and equipment: Energy $ 14,608 $ 32,903 $ 31,474 Metal Coatings 16,046 39,474 32,099 Corporate 2,962 2,020 540 Total $ 33,616 $ 74,397 $ 64,113 February 28, 2019 February 28, 2018 Assets: Energy $ 630,134 $ 554,866 Metal Coatings 440,090 460,575 Corporate 18,346 12,768 Total assets $ 1,088,570 $ 1,028,209 Financial Information About Geographical Areas Financial information about geographical areas for the periods presented was as follows (in thousands): Year Ended February 28, 2019 February 28, 2018 February 28, 2017 Geographic net sales: United States $ 785,194 $ 653,150 $ 705,820 Other countries 141,893 157,280 157,718 Total $ 927,087 $ 810,430 $ 863,538 February 28, 2019 February 28, 2018 Property, plant and equipment, net: United States $ 189,281 $ 194,418 Canada 16,961 18,254 Other Countries 3,985 4,183 Total $ 210,227 $ 216,855 |
Leases
Leases | 12 Months Ended |
Feb. 28, 2019 | |
Leases [Abstract] | |
Leases | Leases The Company is a lessee under various operating leases for facilities and equipment. The Company recognized operating lease costs of $15.6 million , $13.9 million and $17.0 million for fiscal years 2019 , 2018 and 2017 , respectively. As of February 28, 2019 , maturities of the Company's lease liabilities under ASC 842 were as follows (in thousands): Fiscal year: Operating Leases 2020 $ 7,882 2021 7,185 2022 6,803 2023 6,454 2024 5,771 Thereafter 24,718 Total lease payments 58,813 Less imputed interest (11,966 ) Total $ 46,847 As of February 28, 2018, maturities of the Company's lease liabilities under ASC 840 were as follows (in thousands): Fiscal year: Operating Leases 2019 $ 7,336 2020 6,053 2021 5,057 2022 4,924 2023 4,781 Thereafter 25,017 Total $ 53,168 Supplemental information related to the Company's portfolio of operating leases was as follows (in thousands, except years and percentages): Year Ended February 28, 2019 Operating cash flows from operating leases included in lease liabilities $ 8,454 ROU assets obtained in exchange for new operating lease liabilities $ 10,948 Weighted-average remaining lease term - operating leases 9.23 years Weighted-average discount rate - operating leases 5.13 % |
Commitments and Contingencies (
Commitments and Contingencies (Notes) | 12 Months Ended |
Feb. 28, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and contingencies | Commitments and Contingencies Legal On January 11, 2018, Logan Mullins, acting on behalf of himself and a putative class of persons who purchased or otherwise acquired the Company's securities between April 22, 2015 and January 8, 2018, filed a class action complaint in the U.S. District Court for the Northern District of Texas (the "Court") against the Company and two of its executive officers, Thomas E. Ferguson and Paul W. Fehlman. Logan Mullins v. AZZ, Inc., et al., Case No. 4:18-cv-00025-Y. The complaint alleged, among other things, that the Company's SEC filings contained statements that were rendered materially false and misleading by the Company's alleged failure to properly recognize revenue related to certain contracts in its Energy Segment in purported violation of (1) Section 10(b) of the Exchange Act and Rule 10b-5 and (2) Section 20(a) of the Exchange Act. After the Court appointed a Lead Plaintiff in the case, but before the Company was required to respond to the lawsuit, the Plaintiff voluntarily sought dismissal of the complaint without prejudice. On January 16, 2019, the Court dismissed the case without prejudice. No other parties have sought to reopen the case; therefore, the legal matter is no longer pending. In addition, the Company and its subsidiaries are named defendants in various routine lawsuits incidental to our business. These proceedings include labor and employment claims, use of the Company’s intellectual property, worker’s compensation and various environmental matters, all arising in the normal course of business. Although the outcome of these lawsuits or other proceedings cannot be predicted with certainty, and the amount of any potential liability that could arise with respect to such lawsuits or other matters cannot be predicted at this time, management, after consultation with legal counsel, does not expect liabilities, if any, from these claims or proceedings, either individually or in the aggregate, to have a material effect on the Company’s financial position, results of operations or cash flows. Commodity pricing We have no contracted commitments for any commodities including steel, aluminum, natural gas, cooper, zinc, nickel based alloys, except for those entered into under the normal course of business. Other At February 28, 2019 , the Company had outstanding letters of credit in the amount of $44.3 million . These letters of credit are issued for a number of reasons, but are most commonly issued in lieu of customer retention withholding payments covering warranty or performance periods. In addition, as of February 28, 2019 , a warranty reserve in the amount of $1.8 million was established to offset any future warranty claims. |
Acquisitions
Acquisitions | 12 Months Ended |
Feb. 28, 2019 | |
Business Combinations [Abstract] | |
Acquisitions | 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 in the Energy segment. On February 1, 2018, the Company completed the acquisition of all the assets and outstanding shares of Rogers Brothers Company ("Rogers Brothers"), a privately held company, based in Rockford, Illinois. Rogers Brothers provides galvanizing solutions to a multi-state area within the Midwest. The acquisition supports AZZ's goal of continued geographic expansion as well as portfolio expansion of its metal coatings solutions. The goodwill arising from this acquisition was allocated to the Metal Coatings segment and is not deductible for income tax purposes. On September 6, 2017, the Company completed the acquisition of all the assets and outstanding shares of Powergrid Solutions, Inc. ("PSI"), a privately held company, based in Oshkosh, Wisconsin. PSI designs, engineers and manufactures customized low and medium-voltage power quality, power generation and distribution equipment. PSI’s product portfolio includes metal-enclosed, metal-clad and padmount switchgear, serving the utility, commercial, industrial and renewable energy markets since 1982. The acquisition of PSI is a key addition to the Company's electrical switchgear portfolio. The addition of PSI’s low-voltage and padmount switchgear allows AZZ to offer a comprehensive portfolio of customized switchgear solutions to both existing and new customers in a diverse set of industries. The goodwill arising from this acquisition was allocated to the Energy Segment and is deductible for income tax purposes. On June 30, 2017, the Company completed the acquisition of the assets of Enhanced Powder Coating Ltd., (“EPC”), a privately held, high specification, National Aerospace and Defense Contractors Accreditation Program, ("NADCAP"), certified provider of powder coating, plating and anodizing services based in Gainesville, Texas. EPC, founded in 2003, offers a full spectrum of finish technology including powder coating, abrasive blasting and plating for heavy industrial, transportation, aerospace and light commercial industries. The acquisition of EPC is consistent with the Company's strategic initiative to grow its Metal Coatings segment with products and services that complement its industry-leading galvanizing business. The goodwill arising from this acquisition was allocated to the Metal Coatings Segment and is deductible for income tax purposes. On March 1, 2016, the Company completed an acquisition of the equity securities of Power Electronics, Inc. ("PEI"), a Millington, Maryland-based manufacturer and integrator of electrical enclosure systems. The acquisition of PEI will enhance our capacity to serve existing and new customers in a diverse set of industries along the Eastern seaboard of the United States. The goodwill arising from this acquisition was allocated to the Energy Segment and is deductible for income tax purposes. The Company paid $8.0 million , $44.8 million and $22.7 million , for these acquisitions, net of cash acquired, during fiscal 2019 , 2018 and 2017 , respectively. These acquisitions were not significant individually or in the aggregate for any fiscal year. Accordingly, disclosures of the purchase price allocations and unaudited pro forma results of operations have not been provided. |
Subsequent Events (Notes)
Subsequent Events (Notes) | 12 Months Ended |
Feb. 28, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events In April 2019, the Company completed the acquisition of all the assets and outstanding shares of K2 Partners, Inc. (“K2”) and Tennessee Galvanizing, Inc. ("Tennessee Galvanizing"), two privately held companies. K2 provides powder coating and electroplating solutions to customers in the Midwest and Southeast from locations in Texas and Florida. Tennessee Galvanizing provides galvanizing solutions to customers in Southeast Tennessee. These acquisitions expand the Company's geographical reach in metal coating solutions and broadens its offerings in strategic markets. These acquisitions will be included in the Metal Coatings segment. |
Quarterly Financial Information
Quarterly Financial Information, Unaudited (Notes) | 12 Months Ended |
Feb. 28, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly financial information, Unaudited | Selected Quarterly Financial Data (Unaudited) Quarter ended May 31, August 31, November 30, February 28, (in thousands, except per share data) Net sales $ 262,236 $ 222,787 $ 239,516 $ 202,548 Gross profit 58,705 46,904 49,755 43,257 Net income 15,718 11,244 15,395 8,851 Basic earnings per share 0.60 0.43 0.59 0.34 Diluted earnings per share 0.60 0.43 0.59 0.34 Quarter ended May 31, August 31, November 30, February 28, (in thousands, except per share data) Net sales $ 205,283 $ 196,329 $ 208,158 $ 200,660 Gross profit 47,382 43,800 31,117 38,010 Net income 12,062 9,786 (166 ) 23,487 Basic earnings (loss) per share 0.46 0.38 (0.01 ) 0.91 Diluted earnings per (loss) share 0.46 0.38 (0.01 ) 0.90 As discussed in Note 1, an error was identified in connection with adoption of ASC 606, and this error has been corrected in the fourth quarter of fiscal 2019 as an out of period adjustment. This adjustment did not have a material impact to net sales, gross profit or net income for any period presented herein. |
Schedule II _ Valuation and Qua
Schedule II : Valuation and Qualiying Accounts and Reserves (Notes) | 12 Months Ended |
Feb. 28, 2018 | |
Valuation and Qualifying Accounts [Abstract] | |
Schedule II : Valuation and Qualifying Accounts and Reserves | Schedule II AZZ Inc. Valuation and Qualifying Accounts and Reserves (In thousands) Year Ended February 28, 2019 February 28, 2018 February 28, 2017 Allowance for Doubtful Accounts Balance at beginning of year $ 569 $ 347 $ 264 Additions (reductions) charged or credited to income 2,153 3,290 48 (Write offs) recoveries, net (451 ) (3,084 ) 20 Other — 16 11 Effect of exchange rate (4 ) — 4 Balance at end of year $ 2,267 $ 569 $ 347 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Feb. 28, 2019 | |
Accounting Policies [Abstract] | |
Basis of consolidation | Organization AZZ Inc. (the “Company” “AZZ” or “We”) operates primarily in the United States of America and Canada and also has operations in China, Brazil, Poland and the Netherlands. Information about the Company's operations by segment is included in Note 12 to the consolidated financial statements. Basis of consolidation The consolidated financial statements were prepared in accordance with the accounting principles generally accepted in the United States of America and include the accounts of the Company and its wholly owned subsidiaries. All significant inter-company accounts and transactions have been eliminated in consolidation. |
Use of estimates | Use of estimates The preparation of the financial statements in conformity with generally accepted accounting principles in the United States of America ("GAAP") requires management to make estimates and assumptions that affect the amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Concentration of credit risk | Concentrations of credit risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash and cash equivalents and trade accounts receivable. The Company maintains cash and cash equivalents with various financial institutions. These financial institutions are located throughout the United States and Canada, as well as Europe, China and Brazil. The Company's policy is designed to limit exposure to any one institution. The Company performs periodic evaluations of the relative credit standing of those financial institutions that are considered in the Company's banking relationships and has not experienced any losses in such accounts. We believe we are not exposed to any significant credit risk related to cash and cash equivalents. Concentrations of credit risk with respect to trade accounts receivable are limited due to the Company’s diversity by virtue of its two operating segments, the number of customers, and the absence of a concentration of trade accounts receivable in a small number of customers. The Company performs continuous evaluations of the collectibility of trade accounts receivable and allowance for doubtful accounts based upon historical losses, economic conditions and customer specific events. After all collection efforts are exhausted and an account is deemed uncollectible, it is written off against the allowance for doubtful accounts. Collateral is usually not required from customers as a condition of sale. |
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 revenues recognized over time, the Company generally uses the cost-to-cost method of revenue recognition. Under this approach, the extent of progress towards completion is measured based on the ratio of costs incurred to date versus the total estimated costs upon completion of the project. This requires the Company to estimate the total contract revenues, project 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 sheets, 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 sheets on a contract-by-contract basis at the end of each reporting period. For the year ended February 28, 2019, 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 in fiscal 2019 related to performance obligations satisfied in prior periods. The Company expects to recognize revenues of approximately $52.8 million , $1.8 million , and $2.3 million in fiscal 2020, 2021 and 2022, respectively, related to the $56.9 million balance of contract liabilities as of February 28, 2019. The increases or decreases in accounts receivable, contract assets and contract liabilities during fiscal year 2019 were due primarily to normal timing differences between the Company’s performance and customer payments. The Lectrus acquisition described in Note 15 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. |
Cash and cash equivalents | Cash and cash equivalents The Company considers cash and cash equivalents to include cash on hand, deposits with banks and all highly liquid investments with an original maturity of three months or less. |
Inventories | Inventories Inventory is stated at the lower of cost or net realizable value. Cost is determined principally using a weighted-average method for the Energy Segment and the first-in-first-out (FIFO) method for the Metal Coatings Segment. The Company evaluates its ending inventories for excess quantities and obsolescence based on forecasted demand within specific time horizons, technological obsolescence, and an assessment of any inventory that is not in sellable condition. |
Property, plant and equipment | Property, plant and equipment Property and equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets as follows: Buildings and structures 10-25 years Machinery and equipment 3-15 years Furniture and fixtures 3-15 years Automotive equipment 3 years Computers and software 3 years Repairs and maintenance are charged to expense as incurred; renewals and betterments that significantly extend the useful life of the asset are capitalized. |
Intangible assets | Amortizable Intangible and Long-lived assets Purchased intangible assets on the consolidated balance sheets are comprised of customer lists, backlogs, engineering drawings and non-compete agreements. Such intangible assets (excluding indefinite-lived intangible assets) are being amortized on a straight-line basis over the estimated useful lives of the assets ranging from two to nineteen years. The Company records impairment losses on long-lived assets, including identifiable intangible assets, when events and circumstances indicate that the assets might be impaired and the undiscounted projected cash flows associated with those assets are less than their carrying amount. In those situations, impairment loss on a long-lived asset is measured based on the excess of the carrying amount of the asset over the asset’s fair value, which is determined using Level 3 fair value inputs. For fiscal year 2019 , 2018 and 2017 , the Company recorded impairment losses of $0.8 million , $10.8 million and $6.6 million respectively, related to the disposition of certain property, plant and equipment. Such losses were recorded within costs of sales and selling, general and administrative in the consolidated statements of income. Goodwill and Other Indefinite-Lived Intangible Assets Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired in a business combination. Goodwill is not subject to amortization but is subject to an annual impairment test during the fourth quarter of each fiscal year, or earlier if indicators of potential impairment exist. The test is calculated using an income approach and market approach, which are Level 3 fair value inputs. Based on the results of its analysis, the Company determines whether an impairment may exist. A significant change in projected cash flows or cost of capital for future years could result in an impairment of goodwill in future years. Variables impacting future cash flows include, but are not limited to, the level of customer demand for and response to products and services we offer to the power generation market, the electrical transmission and distribution markets, the general industrial market and the hot dip galvanizing market; changes in economic conditions of these various markets; raw material and natural gas costs and availability of experienced labor and management to implement our growth strategies. For fiscal years 2019, 2018 and 2017 no goodwill impairment loss was recorded. Other indefinite-lived intangible assets consist of certain tradenames acquired as part of the Powergrid Solutions and Enhanced Powder Coating acquisitions during fiscal year 2018. The Company tests the carrying value of these tradenames during the fourth quarter of each fiscal year, or more frequently when an event occurs or circumstances change that indicates the carrying value may not be recoverable by comparing the asset's fair value to its carrying value. Fair value, using Level 3 inputs, is measured using a relief-from-royalty approach, which assumes the fair value of the tradename is the discounted cash flows of the amount that would be paid had the Company not owned the tradename and instead licensed the tradename from another company. For fiscal 2019 and 2018, no impairment losses related to these indefinite-lived intangible assets were recorded. |
Long-lived assets | The Company records impairment losses on long-lived assets, including identifiable intangible assets, when events and circumstances indicate that the assets might be impaired and the undiscounted projected cash flows associated with those assets are less than their carrying amount. In those situations, impairment loss on a long-lived asset is measured based on the excess of the carrying amount of the asset over the asset’s fair value, which is determined using Level 3 fair value inputs. |
Goodwill | Goodwill and Other Indefinite-Lived Intangible Assets Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired in a business combination. Goodwill is not subject to amortization but is subject to an annual impairment test during the fourth quarter of each fiscal year, or earlier if indicators of potential impairment exist. The test is calculated using an income approach and market approach, which are Level 3 fair value inputs. Based on the results of its analysis, the Company determines whether an impairment may exist. A significant change in projected cash flows or cost of capital for future years could result in an impairment of goodwill in future years. Variables impacting future cash flows include, but are not limited to, the level of customer demand for and response to products and services we offer to the power generation market, the electrical transmission and distribution markets, the general industrial market and the hot dip galvanizing market; changes in economic conditions of these various markets; raw material and natural gas costs and availability of experienced labor and management to implement our growth strategies. For fiscal years 2019, 2018 and 2017 no goodwill impairment loss was recorded. Other indefinite-lived intangible assets consist of certain tradenames acquired as part of the Powergrid Solutions and Enhanced Powder Coating acquisitions during fiscal year 2018. The Company tests the carrying value of these tradenames during the fourth quarter of each fiscal year, or more frequently when an event occurs or circumstances change that indicates the carrying value may not be recoverable by comparing the asset's fair value to its carrying value. Fair value, using Level 3 inputs, is measured using a relief-from-royalty approach, which assumes the fair value of the tradename is the discounted cash flows of the amount that would be paid had the Company not owned the tradename and instead licensed the tradename from another company. |
Debt issue costs | Debt issuance costs Debt issue costs related to the revolver are deferred within other assets and are amortized using the effective interest rate method over the term of the debt. Debt issue costs related to debt other than the revolver are deferred within total debt due after one year and are amortized using the effective interest rate method over the term of the debt. |
Income taxes | Income taxes The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined on the basis of the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. The Company recognizes a valuation allowance against net deferred tax assets to the extent that the Company believes these net assets are not more likely than not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. If the Company determines that it would be able to realize its deferred tax assets in the future in excess of their net recorded amount, the Company would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes. As applicable, the Company records uncertain tax positions on the basis of a two-step process whereby (1) the Company determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, the Company recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. The Company currently does not have any unrecognized tax benefits to record related to U.S. federal, state or, foreign tax exposure. The Company is subject to taxation in the U.S. and various state, provincial and local and foreign jurisdictions. With few exceptions, as of February 28, 2019 , the Company is no longer subject to U.S. federal or state examinations by tax authorities for years before fiscal 2016. |
Financial Instruments | Financial instruments Fair value is an exit price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. Hierarchy Levels 1, 2, or 3 are terms for the priority of inputs to valuation techniques used to measure fair value. Hierarchy Level 1 inputs are quoted prices in active markets for identical assets or liabilities. Hierarchy Level 2 inputs are inputs other than quoted prices included with Level 1 that are directly or indirectly observable for the asset or liability. Hierarchy Level 3 inputs are inputs that are not observable in the market. The carrying amount of the Company's financial instruments (cash equivalents, accounts receivable, accounts payable, accrued liabilities and debt), excluding the Senior Notes, approximates the fair value of these instruments based upon either their short-term nature or their variable market rate of interest. As of February 28, 2019 and 2018 the fair value of the outstanding Senior Notes, as described in Note 11, was approximately $127.4 million and $133.7 million , respectively. These fair values were determined using the discounted cash flow at the market rate as well as the applicable market interest rates classified as Level 2 inputs. |
Derivative financial instruments | Derivative financial instruments From time to time, the Company uses derivatives to manage interest rate risk. The Company’s policy is to use derivatives for risk management purposes only, which includes maintaining the ratio between the Company’s fixed and floating rate debt obligations that management deems appropriate, and prohibits entering into such contracts for trading purposes. The Company enters into derivatives only with counterparties (primarily financial institutions) which have substantial financial wherewithal to minimize credit risk. The amount of gains or losses from the use of derivative financial instruments has not been and is not expected to be material to the Company’s consolidated financial statements. As of February 28, 2019 , the Company had no derivative financial instruments. |
Warranty reserves | Warranty reserves Within other accrued liabilities, a reserve has been established to provide for the estimated future cost of warranties on a portion of the Company’s delivered products. Management periodically reviews the reserves, and adjustments are made accordingly. A provision for warranty on products is made on the basis of the Company’s historical experience and identified warranty issues. Warranties cover such factors as non-conformance to specifications and defects in material and workmanship. |
Foreign Currency Translation | Foreign Currency Translation The local currency is the functional currency for the Company’s foreign operations. Related assets and liabilities are translated into United States dollars at exchange rates existing at the balance sheet date, and revenues and expenses are translated at weighted-average exchange rates. The foreign currency translation adjustment is recorded as a separate component of shareholders’ equity and is included in accumulated other comprehensive income (loss). |
Long-Term Contingent Liability | Accruals for Contingent Liabilities The Company is subject to the possibility of various loss contingencies arising in the normal course of business. The amounts the Company may record for estimated claims, such as self-insurance programs, warranty, environmental and other contingent liabilities, requires the Company to make judgments regarding the amount of expenses that will ultimately be incurred. The Company uses past history and experience and other specific circumstances surrounding these claims in evaluating the amount of liability that should be recorded. Due to the inherent limitations in estimating future events, actual amounts paid or transferred may differ from those estimates. |
Lessee, Leases [Policy Text Block] | Leases The Company is a lessee under various operating leases for facilities and equipment. For such leases, the Company recognizes a right-of-use ("ROU") asset and lease liability on the consolidated balance sheet as of the lease commencement date based on the present value of the future minimum lease payments. An ROU asset represents the Company's right to use an underlying asset during the lease term and a lease liability represents the Company's obligation to make lease payments. However, for short-term leases with an initial term of twelve months or less that do not contain an option to purchase that is likely to be exercised, the Company does not record ROU assets or lease liabilities on the consolidated balance sheet. The Company's uses its incremental borrowing rate to determine the present value of future payments unless the implicit rate in the lease is readily determinable. In determining the future minimum lease payments, the Company incorporates options to extend or terminate the lease when it is reasonably certain that such options will be exercised. The ROU asset includes any initial direct costs incurred and is recorded net of any lease incentives received. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term as the ROU asset is amortized and the lease liability is accreted. For facilities leases, the Company accounts for lease and non-lease components on a combined basis, while for equipment leases, the lease and non-lease components are accounted for separately. |
New Accounting Pronouncements, Policy [Policy Text Block] | Accounting Standards Recently Adopted During the fourth quarter of fiscal 2019, effective March 1, 2018, the Company adopted ASU 2016-02, Leases (Topic 842) using a modified retrospective approach as of the period of adoption. Periods prior to the adoption continue to be presented under legacy guidance and there was no cumulative effect adjustment to beginning retained earnings on the March 1, 2018 adoption date. On the date of adoption, the Company recorded operating lease right of use assets of $42.1 million and lease liabilities of $42.8 million to reflect the Company's portfolio of operating leases, which were previously unrecorded under legacy accounting guidance. However, the adoption did not have any impact on the Company's consolidated statements of income or cash flows. The Company has elected the package of practical expedients permitted under the transition guidance within the new standard, which among several other items, allows the Company to carry-forward the historical lease classification from legacy guidance for leases that existed on the date of adoption. 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. The cumulative effect of initially applying ASC 606 was recorded as an adjustment to the opening balance of retained earnings, which impacted the consolidated balance sheet as follows: Balance Sheet February 28, 2018 ASC 606 Adjustments March 1, 2018 Assets Inventories $ 110,761 $ 7,664 $ 118,425 Liabilities and shareholders' equity Contract liabilities 22,698 6,948 29,646 Retained Earnings 526,018 716 526,734 During the preparation of the consolidated financial statements for the year ended February 28, 2019, the Company identified an error related to the adoption of ASC 606. This impact was recorded as an out-of-period adjustment during the fourth quarter of fiscal year 2019, which increased net sales by $3.5 million, cost of good sold by $2.4 million and net income by $1.0 million. The disclosures above show the impact of this adjustment as of the adoption date on March 1, 2018. Management considered the impact on the previously issued financial statements and concluded that the adjustments were not material. The adoption of ASC 606 had the following impact on the consolidated balance sheets and consolidated statements of income as of and for the fiscal year ended February 28, 2019: Balance Sheet As Reported Balance Excluding ASC 606 Effects Change Assets Inventories $ 124,847 $ 119,627 $ 5,220 Liabilities and shareholders' equity Contract liabilities 56,928 53,444 3,484 Consolidated Statements of Income As Reported Balance Excluding ASC 606 Effects Change Net sales $ 927,087 $ 923,623 $ 3,464 Cost of goods sold 728,466 726,022 2,444 Gross profit 198,621 197,601 1,020 Operating income 76,956 75,936 1,020 Recently Issued Accounting Pronouncements There are no recently issued accounting pronouncements outstanding that are likely to have a material impact on the Company's consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Feb. 28, 2019 | |
Accounting Policies [Abstract] | |
Disaggregation of Revenue | Disaggregated Revenue Revenue by segment and geography is disclosed in Note 12. In addition, the following table presents disaggregated revenue by customer industry (in thousands): Year Ended February 28, 2019 February 28, 2018 February 28, 2017 Net sales: Industrial - oil and gas, construction, and general $ 526,465 $ 461,945 $ 518,123 Transmission and distribution 212,433 194,503 164,072 Power generation 188,189 153,982 181,343 Total net sales $ 927,087 $ 810,430 $ 863,538 |
Property, Plant and Equipment | Depreciation is computed using the straight-line method over the estimated useful lives of the related assets as follows: Buildings and structures 10-25 years Machinery and equipment 3-15 years Furniture and fixtures 3-15 years Automotive equipment 3 years Computers and software 3 years Property, Plant and Equipment Property, plant and equipment consisted of the following (in thousands): February 28, 2019 February 28, 2018 Land $ 21,677 $ 22,445 Building and structures 156,447 152,191 Machinery and equipment 245,588 234,071 Furniture, fixtures, software and computers 27,075 25,316 Automotive equipment 3,766 3,432 Construction in progress 13,065 13,977 467,618 451,432 Less accumulated depreciation (257,391 ) (234,577 ) Net property, plant, and equipment $ 210,227 $ 216,855 |
Schedule of Warranty Reserve | The following is a roll-forward of amounts accrued for warranties (in thousands): Balance at February 29, 2016 $ 2,915 Warranty costs incurred (1,947 ) Additions charged to income 1,130 Balance at February 28, 2017 $ 2,098 Warranty costs incurred (2,225 ) Additions charged to income 2,140 Balance at February 28, 2018 $ 2,013 Warranty costs incurred (2,195 ) Additions charged to income 1,933 Balance at February 28, 2019 $ 1,751 |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles | The cumulative effect of initially applying ASC 606 was recorded as an adjustment to the opening balance of retained earnings, which impacted the consolidated balance sheet as follows: Balance Sheet February 28, 2018 ASC 606 Adjustments March 1, 2018 Assets Inventories $ 110,761 $ 7,664 $ 118,425 Liabilities and shareholders' equity Contract liabilities 22,698 6,948 29,646 Retained Earnings 526,018 716 526,734 During the preparation of the consolidated financial statements for the year ended February 28, 2019, the Company identified an error related to the adoption of ASC 606. This impact was recorded as an out-of-period adjustment during the fourth quarter of fiscal year 2019, which increased net sales by $3.5 million, cost of good sold by $2.4 million and net income by $1.0 million. The disclosures above show the impact of this adjustment as of the adoption date on March 1, 2018. Management considered the impact on the previously issued financial statements and concluded that the adjustments were not material. The adoption of ASC 606 had the following impact on the consolidated balance sheets and consolidated statements of income as of and for the fiscal year ended February 28, 2019: Balance Sheet As Reported Balance Excluding ASC 606 Effects Change Assets Inventories $ 124,847 $ 119,627 $ 5,220 Liabilities and shareholders' equity Contract liabilities 56,928 53,444 3,484 Consolidated Statements of Income As Reported Balance Excluding ASC 606 Effects Change Net sales $ 927,087 $ 923,623 $ 3,464 Cost of goods sold 728,466 726,022 2,444 Gross profit 198,621 197,601 1,020 Operating income 76,956 75,936 1,020 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Feb. 28, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventories, net consisted of the following (in thousands): February 28, 2019 February 28, 2018 Raw materials $ 94,410 $ 98,475 Work-in-process 19,067 2,544 Finished goods 11,370 9,742 $ 124,847 $ 110,761 |
Property, Plant and Equipment_2
Property, Plant and Equipment (Tables) | 12 Months Ended |
Feb. 28, 2019 | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment | Depreciation is computed using the straight-line method over the estimated useful lives of the related assets as follows: Buildings and structures 10-25 years Machinery and equipment 3-15 years Furniture and fixtures 3-15 years Automotive equipment 3 years Computers and software 3 years Property, Plant and Equipment Property, plant and equipment consisted of the following (in thousands): February 28, 2019 February 28, 2018 Land $ 21,677 $ 22,445 Building and structures 156,447 152,191 Machinery and equipment 245,588 234,071 Furniture, fixtures, software and computers 27,075 25,316 Automotive equipment 3,766 3,432 Construction in progress 13,065 13,977 467,618 451,432 Less accumulated depreciation (257,391 ) (234,577 ) Net property, plant, and equipment $ 210,227 $ 216,855 |
Other Accrued Liabilities (Tabl
Other Accrued Liabilities (Tables) | 12 Months Ended |
Feb. 28, 2019 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of Accrued Liabilities | Other accrued liabilities consisted of the following (in thousands): February 28, 2019 February 28, 2018 Accrued interest $ 1,196 $ 1,649 Accrued warranty 1,751 2,013 Commissions 3,370 2,801 Personnel expenses 6,282 6,493 Group medical insurance 2,024 1,905 Other 3,008 4,761 Total $ 17,631 $ 19,622 |
Restructuring and Other Relat_2
Restructuring and Other Related Costs (Tables) | 12 Months Ended |
Feb. 28, 2019 | |
Restructuring Cost and Reserve [Line Items] | |
Schedule of Restructuring Reserve by Type of Cost [Table Text Block] | : Balance at February 29, 2016 $ 61 Restructuring and other related costs 7,862 Non-cash adjustments (6,602 ) Cash payments (1,014 ) Balance at February 28, 2017 $ 307 Restructuring and other related costs — Cash payments (307 ) Balance at February 28, 2018 $ — Restructuring and other related costs 1,301 Non-cash adjustments (810 ) Cash payments (491 ) Balance at February 28, 2019 $ — |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Feb. 28, 2019 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | The provision for income taxes consists of (in thousands): Year Ended February 28, 2019 February 28, 2018 February 28, 2017 Income before income taxes: Domestic $ 48,261 $ 24,282 $ 74,972 Foreign 14,744 6,617 10,325 Income before income taxes $ 63,005 $ 30,899 $ 85,297 Current provision (benefit): Federal $ 4,251 $ 3,445 $ 18,688 Foreign 2,829 1,958 2,751 State and local 986 964 1,290 Total current provision for income taxes $ 8,066 $ 6,367 $ 22,729 Deferred provision (benefit): Federal $ 2,970 $ (20,220 ) $ 2,486 Foreign 539 100 (189 ) State and local 222 (517 ) (993 ) Total deferred provision for (benefit from) income taxes $ 3,731 $ (20,637 ) $ 1,304 Total provision for (benefit from) income taxes $ 11,797 $ (14,270 ) $ 24,033 |
Schedule of Effective Income Tax Rate Reconciliation | A reconciliation from the federal statutory income tax rate to the effective income tax rate is as follows: Year Ended February 28, 2019 February 28, 2018 February 28, 2017 Statutory federal income tax rate 21.0 % 32.7 % 35.0 % Permanent differences 0.5 1.6 0.7 State income taxes, net of federal income tax benefit 0.4 0.4 0.4 Benefit of Section 199 of the Code, manufacturing deduction — (2.2 ) (2.3 ) Valuation allowance (0.7 ) — — Stock compensation 0.5 (0.5 ) (1.8 ) Tax credits (4.1 ) (7.7 ) (3.1 ) Foreign tax rate differential 1.1 (0.4 ) (0.8 ) Deferred tax remeasurements — (78.9 ) — Transition tax — 8.6 — Other — 0.2 0.1 Effective income tax rate 18.7 % (46.2 )% 28.2 % |
Schedule of Deferred Tax Assets and Liabilities | Significant components of the Company’s net deferred income tax liability are as follows (in thousands): February 28, 2019 February 28, 2018 Deferred income tax assets: Employee related items $ 4,177 $ 4,532 Inventories 758 816 Accrued warranty 369 432 Accounts receivable (2,092 ) 299 Net operating loss carry forward 7,173 5,067 10,385 11,146 Less: valuation allowance (3,015 ) (1,558 ) Total deferred income tax assets 7,370 9,588 Deferred income tax liabilities: Depreciation methods and property basis differences (19,066 ) (17,955 ) Other assets and tax-deductible goodwill (24,927 ) (24,537 ) Total deferred income tax liabilities (43,993 ) (42,492 ) Net deferred income tax liabilities $ (36,623 ) $ (32,904 ) |
Summary of Operating Loss Carryforwards | The following table summarizes the Net operating loss (NOL) carryforward (in thousands): February 28, 2019 February 28, 2018 Federal $ — $ — State $ 6,352 $ 5,067 Foreign $ 821 $ — |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Feb. 28, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | Changes in goodwill by segment for fiscal year 2019 and 2018 are as follows (in thousands): Segment February 28, 2018 Acquisitions Foreign February 28, 2019 Metal Coatings $ 117,232 $ 73 $ (614 ) $ 116,691 Energy 204,075 2,990 — 207,065 Total $ 321,307 $ 3,063 $ (614 ) $ 323,756 Segment February 28, 2017 Acquisitions Foreign February 28, 2018 Metal Coatings $ 109,980 $ 6,590 $ 662 $ 117,232 Energy 196,599 7,476 — 204,075 Total $ 306,579 $ 14,066 $ 662 $ 321,307 |
Schedule of Finite-Lived Intangible Assets by Major Class | Amortizable intangible assets consisted of the following (in thousands): February 28, 2019 February 28, 2018 Customer related intangibles $ 191,460 $ 194,712 Non-compete agreements 8,546 7,952 Trademarks 4,569 4,569 Technology 7,400 7,400 Engineering drawings 24,600 24,600 Backlog 7,600 7,600 Gross intangible assets 244,175 246,833 Less accumulated amortization (122,199 ) (105,642 ) Total, net $ 121,976 $ 141,191 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | The estimated amortization expense for the five succeeding fiscal years and thereafter is as follows (in thousands): Fiscal year: Amortization Expense 2020 $ 16,393 2021 16,227 2022 14,142 2023 13,058 2024 11,121 Thereafter 51,035 Total $ 121,976 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Feb. 28, 2019 | |
Earnings Per Share [Abstract] | |
Computation of basic and diluted earnings per share | The following table sets forth the computation of basic and diluted earnings per share (in thousands, except per share data): Year Ended February 28, 2019 February 28, 2018 February 28, 2017 Numerator: Net income for basic and diluted earnings per common share $ 51,208 $ 45,169 $ 61,264 Denominator: Denominator for basic earnings per common share–weighted average shares 26,038 25,970 25,965 Effect of dilutive securities: Employee and director stock awards 69 66 132 Denominator for diluted earnings per common share 26,107 26,036 26,097 Earnings per share basic and diluted: Basic earnings per common share $ 1.97 $ 1.74 $ 2.36 Diluted earnings per common share $ 1.96 $ 1.73 $ 2.35 |
Stock Compensation (Tables)
Stock Compensation (Tables) | 12 Months Ended |
Feb. 28, 2019 | |
Share-based Compensation [Abstract] | |
Restricted Stock Unit Awards Non-Vested | The activity for non-vested restricted stock unit awards for the year ended February 28, 2019 is as follows: Restricted Weighted Non-Vested Balance as of February 28, 2018 109,777 $ 56.62 Granted 84,895 42.05 Vested (38,733 ) 54.53 Forfeited (9,407 ) 53.46 Non-Vested Balance as of February 28, 2019 146,532 $ 48.93 |
Share-based Compensation, Performance Shares Award Outstanding Activity [Table Text Block] | The activity in our non-vested performance stock unit awards for the year ended February 28, 2019 is as follows: Performance Stock Units Weighted Average Grant Date Fair Value 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 February 28, 2019 83,125 $ 49.74 |
Stock Appreciation Rights and Option Awards | A summary of the Company’s stock appreciation rights awards activity is as follows: Year Ended February 28, 2019 February 28, 2018 February 28, 2017 SARs Weighted Average Exercise Price SARs Weighted Average Exercise Price SARs Weighted Average Exercise Price Outstanding at beginning of year 148,513 $ 43.29 170,139 $ 42.02 312,748 $ 34.23 Granted — — — — — — Exercised (47,484 ) 40.84 (19,481 ) 31.94 (141,983 ) 24.85 Forfeited (2,845 ) 43.92 (2,145 ) 45.36 (626 ) 43.92 Outstanding at end of year 98,184 $ 44.46 148,513 $ 43.29 170,139 $ 42.02 Exercisable at end of year 98,184 $ 44.46 148,513 $ 43.29 126,975 $ 41.27 |
Share-based Compensation Activity | The following table summarizes additional information about stock appreciation rights outstanding at February 28, 2019 . Range of Total Average Weighted SARs Weighted $39.65 950 1.52 $ 39.65 950 $ 39.65 $43.92 54,510 2.01 $ 43.92 54,510 $ 43.92 $45.26 40,000 1.68 $ 45.26 40,000 $ 45.26 $45.36 2,724 1.00 $ 45.36 2,724 $ 45.36 $39.65 - $45.36 98,184 1.84 $ 44.46 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): Year Ended February 28, 2019 February 28, 2018 February 28, 2017 Compensation expense $ 4,659 $ 6,121 $ 5,870 Income tax benefits $ 978 $ 2,122 $ 2,055 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Feb. 28, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | February 28, 2019 February 28, 2018 2017 Revolving Line of Credit $ 116,000 $ 162,000 2011 Senior Notes 125,000 125,000 2008 Senior Notes — 14,286 Total debt 241,000 301,286 Unamortized debt issuance costs (255 ) (391 ) Total debt, net 240,745 300,895 Less amount due within one year — (14,286 ) Debt due after one year, net $ 240,745 $ 286,609 |
Schedule of Maturities of Long-term Debt | Maturities of debt are as follows (in thousands): Fiscal year: Future Debt Maturities 2020 $ — 2021 125,000 2022 — 2023 116,000 2024 — Thereafter — Total $ 241,000 |
Operating segments (Tables)
Operating segments (Tables) | 12 Months Ended |
Feb. 28, 2019 | |
Segment Reporting [Abstract] | |
Operations and assets by segment | Year Ended February 28, 2019 February 28, 2018 February 28, 2017 Net sales: Energy $ 486,823 $ 421,033 $ 488,002 Metal Coatings 440,264 389,397 375,536 Total net sales $ 927,087 $ 810,430 $ 863,538 Operating income (loss): Energy $ 31,332 $ (1,766 ) $ 52,577 Metal Coatings 83,591 84,332 79,033 Corporate (37,967 ) (34,318 ) (32,702 ) Total operating income $ 76,956 $ 48,248 $ 98,908 Year Ended February 28, 2019 February 28, 2018 February 28, 2017 Depreciation and amortization: Energy $ 19,405 $ 19,996 $ 19,624 Metal Coatings 29,124 28,617 28,650 Corporate 1,716 1,913 2,083 Total $ 50,245 $ 50,526 $ 50,357 Year Ended February 28, 2019 February 28, 2018 February 28, 2017 Expenditures for acquisitions, net of cash, and property, plant and equipment: Energy $ 14,608 $ 32,903 $ 31,474 Metal Coatings 16,046 39,474 32,099 Corporate 2,962 2,020 540 Total $ 33,616 $ 74,397 $ 64,113 February 28, 2019 February 28, 2018 Assets: Energy $ 630,134 $ 554,866 Metal Coatings 440,090 460,575 Corporate 18,346 12,768 Total assets $ 1,088,570 $ 1,028,209 Financial Information About Geographical Areas Financial information about geographical areas for the periods presented was as follows (in thousands): Year Ended February 28, 2019 February 28, 2018 February 28, 2017 Geographic net sales: United States $ 785,194 $ 653,150 $ 705,820 Other countries 141,893 157,280 157,718 Total $ 927,087 $ 810,430 $ 863,538 February 28, 2019 February 28, 2018 Property, plant and equipment, net: United States $ 189,281 $ 194,418 Canada 16,961 18,254 Other Countries 3,985 4,183 Total $ 210,227 $ 216,855 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Feb. 28, 2019 | |
Leases [Abstract] | |
Lessee, Operating Lease, Liability, Maturity | As of February 28, 2019 , maturities of the Company's lease liabilities under ASC 842 were as follows (in thousands): Fiscal year: Operating Leases 2020 $ 7,882 2021 7,185 2022 6,803 2023 6,454 2024 5,771 Thereafter 24,718 Total lease payments 58,813 Less imputed interest (11,966 ) Total $ 46,847 |
Schedule of Future Minimum Rental Payments for Operating Leases | As of February 28, 2018, maturities of the Company's lease liabilities under ASC 840 were as follows (in thousands): Fiscal year: Operating Leases 2019 $ 7,336 2020 6,053 2021 5,057 2022 4,924 2023 4,781 Thereafter 25,017 Total $ 53,168 |
Lease, Cost | Supplemental information related to the Company's portfolio of operating leases was as follows (in thousands, except years and percentages): Year Ended February 28, 2019 Operating cash flows from operating leases included in lease liabilities $ 8,454 ROU assets obtained in exchange for new operating lease liabilities $ 10,948 Weighted-average remaining lease term - operating leases 9.23 years Weighted-average discount rate - operating leases 5.13 % |
Quarterly Financial Informati_2
Quarterly Financial Information, Unaudited (Tables) | 12 Months Ended |
Feb. 28, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Information | Quarter ended May 31, August 31, November 30, February 28, (in thousands, except per share data) Net sales $ 262,236 $ 222,787 $ 239,516 $ 202,548 Gross profit 58,705 46,904 49,755 43,257 Net income 15,718 11,244 15,395 8,851 Basic earnings per share 0.60 0.43 0.59 0.34 Diluted earnings per share 0.60 0.43 0.59 0.34 Quarter ended May 31, August 31, November 30, February 28, (in thousands, except per share data) Net sales $ 205,283 $ 196,329 $ 208,158 $ 200,660 Gross profit 47,382 43,800 31,117 38,010 Net income 12,062 9,786 (166 ) 23,487 Basic earnings (loss) per share 0.46 0.38 (0.01 ) 0.91 Diluted earnings per (loss) share 0.46 0.38 (0.01 ) 0.90 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) | 12 Months Ended |
Feb. 28, 2019operating_segment | |
Business Acquisition [Line Items] | |
Number of operating segments | 2 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Contract Liability Details (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Feb. 28, 2022 | Feb. 28, 2021 | Feb. 29, 2020 | Feb. 28, 2019 | |
Contract Liability Details [Abstract] | ||||
Contract with Customer, Liability, Revenue Recognized | $ 20.1 | |||
Future Revenues | $ 2.3 | $ 1.8 | $ 52.8 | |
Revenue, Remaining Performance Obligation | $ 56.9 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Disaggregated Revenues (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Feb. 28, 2019 | Nov. 30, 2018 | Aug. 31, 2018 | May 31, 2018 | Feb. 28, 2018 | Nov. 30, 2017 | Aug. 31, 2017 | May 31, 2017 | Feb. 28, 2019 | Feb. 28, 2018 | Feb. 28, 2017 | |
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | $ 202,548 | $ 239,516 | $ 222,787 | $ 262,236 | $ 200,660 | $ 208,158 | $ 196,329 | $ 205,283 | $ 927,087 | $ 810,430 | $ 863,538 |
Industrial [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 526,465 | 461,945 | 518,123 | ||||||||
Trasmission & Distribution [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 212,433 | 194,503 | 164,072 | ||||||||
Power Generation [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | $ 188,189 | $ 153,982 | $ 181,343 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Property, Plant, and Equipment (Details) | 12 Months Ended |
Feb. 28, 2019 | |
Building and Building Improvements [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 10 years |
Building and Building Improvements [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 25 years |
Machinery and Equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 3 years |
Machinery and Equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 15 years |
Furniture and Fixtures [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 3 years |
Furniture and Fixtures [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 15 years |
Vehicles [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 3 years |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2019 | Feb. 28, 2018 | Feb. 28, 2017 | |
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Gain (Loss) on Disposition of Assets | $ (810) | $ (10,834) | $ (6,602) |
Minimum [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Useful life | 2 years | ||
Maximum [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Useful life | 19 years |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies - Product Warranty Roll-forward (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2019 | Feb. 28, 2018 | Feb. 28, 2017 | |
Movement in Standard Product Warranty Accrual [Roll Forward] | |||
Balance, beginning balance | $ 2,013 | $ 2,098 | $ 2,915 |
Warranty costs incurred | (2,195) | (2,225) | (1,947) |
Additions charged to income | 1,933 | 2,140 | 1,130 |
Balance, ending balance | $ 1,751 | $ 2,013 | $ 2,098 |
Summary of Significant Accou_10
Summary of Significant Accounting Policies - Debt (Details) - Senior Notes [Member] - USD ($) | Feb. 28, 2019 | Feb. 28, 2018 | Jan. 21, 2011 |
Unsecured Senior Notes Due March 31, 2018 [Member] | |||
Debt Instrument [Line Items] | |||
Fair value of notes | $ 127,400,000 | $ 133,700,000 | |
Unsecured Senior Notes Due January 2021 [Member] | |||
Debt Instrument [Line Items] | |||
Debt instrument, face amount | $ 125,000,000 |
Summary of Significant Accou_11
Summary of Significant Accounting Policies - Accounting Standards Recently Adopted (Details) - USD ($) $ in Thousands | Feb. 28, 2019 | Mar. 01, 2018 | Feb. 28, 2018 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Operating lease, right-of-use asset | $ 45,870 | $ 0 | |
Operating lease, liability | $ 46,847 | ||
Accounting Standards Update 2016-02 [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Operating lease, right-of-use asset | $ 42,100 | ||
Operating lease, liability | $ 42,800 |
Summary of Significant Accou_12
Summary of Significant Accounting Policies - ASC 606 Opening Adjustments (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Feb. 28, 2019 | Nov. 30, 2018 | Aug. 31, 2018 | May 31, 2018 | Feb. 28, 2018 | Nov. 30, 2017 | Aug. 31, 2017 | May 31, 2017 | Feb. 28, 2019 | Feb. 28, 2018 | Feb. 28, 2017 | Mar. 01, 2018 | |
Assets | ||||||||||||
Inventories | $ 124,847 | $ 110,761 | $ 124,847 | $ 110,761 | $ 118,425 | |||||||
Liabilities and shareholders' equity | ||||||||||||
Contract liabilities | 56,928 | 22,698 | 56,928 | 22,698 | 29,646 | |||||||
Retained earnings | 560,224 | 526,018 | 560,224 | 526,018 | 526,734 | |||||||
Consolidated Statements of Income | ||||||||||||
Revenue, Net | 202,548 | $ 239,516 | $ 222,787 | $ 262,236 | 200,660 | $ 208,158 | $ 196,329 | $ 205,283 | 927,087 | 810,430 | $ 863,538 | |
Cost of goods sold | 728,466 | 650,121 | 658,206 | |||||||||
Gross profit | 43,257 | $ 49,755 | $ 46,904 | $ 58,705 | 38,010 | $ 31,117 | $ 43,800 | $ 47,382 | 198,621 | 160,309 | 205,332 | |
Operating income | 76,956 | 48,248 | $ 98,908 | |||||||||
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||||||||||||
Assets | ||||||||||||
Inventories | 119,627 | 110,761 | 119,627 | 110,761 | ||||||||
Liabilities and shareholders' equity | ||||||||||||
Contract liabilities | 53,444 | 22,698 | 53,444 | 22,698 | ||||||||
Retained earnings | $ 526,018 | $ 526,018 | ||||||||||
Consolidated Statements of Income | ||||||||||||
Revenue, Net | 923,623 | |||||||||||
Cost of goods sold | 726,022 | |||||||||||
Gross profit | 197,601 | |||||||||||
Operating income | 75,936 | |||||||||||
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Accounting Standards Update 2014-09 [Member] | ||||||||||||
Assets | ||||||||||||
Inventories | 5,220 | 5,220 | 7,664 | |||||||||
Liabilities and shareholders' equity | ||||||||||||
Contract liabilities | $ 3,484 | 3,484 | 6,948 | |||||||||
Retained earnings | $ 716 | |||||||||||
Consolidated Statements of Income | ||||||||||||
Revenue, Net | 3,464 | |||||||||||
Cost of goods sold | 2,444 | |||||||||||
Gross profit | 1,020 | |||||||||||
Operating income | $ 1,020 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Feb. 28, 2019 | Mar. 01, 2018 | Feb. 28, 2018 |
Inventory Disclosure [Abstract] | |||
Raw materials | $ 94,410 | $ 98,475 | |
Work-in-process | 19,067 | 2,544 | |
Finished goods | 11,370 | 9,742 | |
Total Inventory | $ 124,847 | $ 118,425 | $ 110,761 |
Property, Plant and Equipment_3
Property, Plant and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2019 | Feb. 28, 2018 | Feb. 28, 2017 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation | $ 33,200 | $ 33,400 | $ 33,400 |
Property, Plant and Equipment, Gross | 467,618 | 451,432 | |
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | (257,391) | (234,577) | |
Property, plant, and equipment, net | 210,227 | 216,855 | |
Land [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 21,677 | 22,445 | |
Building and Building Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 156,447 | 152,191 | |
Machinery and Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 245,588 | 234,071 | |
Furniture and Fixtures [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 27,075 | 25,316 | |
Vehicles [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 3,766 | 3,432 | |
Construction in Progress [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | $ 13,065 | $ 13,977 |
Other Accrued Liabilities (Deta
Other Accrued Liabilities (Details) - USD ($) $ in Thousands | Feb. 28, 2019 | Feb. 28, 2018 |
Other Liabilities Disclosure [Abstract] | ||
Accrued interest | $ 1,196 | $ 1,649 |
Accrued warranty | 1,751 | 2,013 |
Commissions | 3,370 | 2,801 |
Personnel expenses | 6,282 | 6,493 |
Group medical insurance | 2,024 | 1,905 |
Other Sundry Liabilities, Current | 3,008 | 4,761 |
Total other accrued liabilities | $ 17,631 | $ 19,622 |
Restructuring and Other Relat_3
Restructuring and Other Related Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Feb. 28, 2019 | Feb. 28, 2018 | Feb. 28, 2017 | Feb. 29, 2016 | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Reserve | $ 0 | $ 0 | $ 307 | $ 61 |
Payments for Restructuring | (491) | (307) | (1,014) | |
Gain (Loss) on Disposition of Assets | (810) | $ (10,834) | (6,602) | |
Restructuring Charges | 1,300 | 7,900 | ||
One-time Termination Benefits [Member] | Selling, General and Administrative Expenses [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Charges | 1,300 | |||
One-time Termination Benefits [Member] | Cost of Sales [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Charges | 500 | |||
Other Restructuring [Member] | Cost of Sales [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Charges | $ 800 | $ 6,600 |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Feb. 28, 2019 | Feb. 28, 2018 | Feb. 28, 2017 | |
Postemployment Benefits [Abstract] | |||
Costs recognized for postemployement benefit plan | $ 5 | $ 4.8 | $ 4.5 |
Employee Benefit Plans Multiemp
Employee Benefit Plans Multiemployer Plan (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2019 | Feb. 28, 2018 | Feb. 28, 2017 | |
Multiemployer Plans [Line Items] | |||
Multiemployer Plan, Contributions by Employer | $ 6,278 | $ 4,540 | $ 8,095 |
Boilermaker-Blacksmith National Pension Trust [Member] | |||
Multiemployer Plans [Line Items] | |||
Entity ID Number | EIN:48-6168020 Plan: 001 | ||
Zone Status | Endangered | Endangered | |
Multiemployer Plans, Funding Improvement Plan and Rehabilitation Plan | Implemented | ||
Multiemployer Plan, Contributions by Employer | $ 5,651 | $ 4,070 | 7,359 |
Multiemployer Plans, Surcharge | No | ||
Multiemployer Plans, Collective-Bargaining Arrangement, Expiration Date | Various through 12/31/2019 | ||
Individually Insignificant Plans [Member] | |||
Multiemployer Plans [Line Items] | |||
Multiemployer Plan, Contributions by Employer | $ 627 | $ 470 | $ 736 |
Income Taxes - Provision of Inc
Income Taxes - Provision of Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2019 | Feb. 28, 2018 | Feb. 28, 2017 | |
Income (loss) before income taxes: | |||
Domestic | $ 48,261 | $ 24,282 | $ 74,972 |
Foreign | 14,744 | 6,617 | 10,325 |
Income before income taxes | 63,005 | 30,899 | 85,297 |
Current provision: | |||
Federal | 4,251 | 3,445 | 18,688 |
Foreign | 2,829 | 1,958 | 2,751 |
State and local | 986 | 964 | 1,290 |
Total current provision for income taxes | 8,066 | 6,367 | 22,729 |
Deferred provision (benefit): | |||
Federal | 2,970 | (20,220) | 2,486 |
Foreign | 539 | 100 | (189) |
State and local | 222 | (517) | (993) |
Deferred Income Tax Expense (Benefit) | 3,731 | (20,637) | 1,304 |
Total provision for income taxes | $ 11,797 | $ (14,270) | $ 24,033 |
Income Taxes - Reconcilliation
Income Taxes - Reconcilliation of Effective Income Tax Rate (Details) | 12 Months Ended | ||
Feb. 28, 2019 | Feb. 28, 2018 | Feb. 28, 2017 | |
Income Tax Disclosure [Abstract] | |||
Statutory federal income tax rate | 21.00% | 32.70% | 35.00% |
Effective Income Tax Rate Reconciliation, Nondeductible Expense, Meals and Entertainment, Percent | 0.50% | 1.60% | 0.70% |
State income taxes, net of federal income tax benefit | 0.40% | 0.40% | 0.40% |
Benefit of Section 199 of the Code, manufacturing deduction | 0.00% | (2.20%) | (2.30%) |
Effective Income Tax Rate Reconciliation, Change in Deferred Tax Assets Valuation Allowance, Percent | (0.70%) | 0.00% | 0.00% |
Effective Income Tax Rate Reconciliation,Other Reconciling Items, Percent | 0.50% | (0.50%) | (1.80%) |
Other | 0.00% | 0.20% | 0.10% |
Effective Income Tax Rate Reconciliation, Tax Credit, Percent | (4.10%) | (7.70%) | (3.10%) |
Effective Income Tax Rate Reconciliation, Foreign Income Tax Rate Differential, Percent | 1.10% | (0.40%) | (0.80%) |
Effective Income Tax Rate Reconciliation, Change in Enacted Tax Rate, Percent | 0.00% | (78.90%) | 0.00% |
Effective Income Tax Rate Reconciliation, Tax Contingency, Domestic, Percent | 0.00% | 8.60% | 0.00% |
Effective income tax rate | 18.70% | (46.20%) | 28.20% |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Feb. 28, 2019 | Feb. 28, 2018 |
Deferred income tax assets: | ||
Employee related items | $ 4,177 | $ 4,532 |
Inventories | 758 | 816 |
Accrued warranty | 369 | 432 |
Deferred Tax Assets, Tax Deferred Expense, Reserves and Accruals, Allowance for Doubtful Accounts | (2,092) | 299 |
Net operating loss carry forward | 7,173 | 5,067 |
Total deferred income tax assets | 10,385 | 11,146 |
Deferred Tax Assets, Valuation Allowance | (3,015) | (1,558) |
Deferred Tax Assets, Net of Valuation Allowance | 7,370 | 9,588 |
Deferred income tax liabilities: | ||
Depreciation methods and property basis differences | (19,066) | (17,955) |
Deferred Tax Liabilities, Goodwill and Intangible Assets | (24,927) | (24,537) |
Total deferred income tax liabilities | (43,993) | (42,492) |
Net deferred income tax liabilities | $ (36,623) | $ (32,904) |
Income Taxes - Schedule of Net
Income Taxes - Schedule of Net Operating Loss Carryforwards (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Feb. 28, 2019 | Feb. 28, 2018 | |
Operating Loss Carryforwards [Line Items] | ||
Deferred Tax Assets, Valuation Allowance | $ 3,015 | $ 1,558 |
Federal | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforward, tax impact | 0 | 0 |
State | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforward, tax impact | 6,352 | 5,067 |
Operating loss carryforwards | 97,700 | |
Foreign | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforward, tax impact | $ 821 | $ 0 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Schedule of Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Feb. 28, 2019 | Feb. 28, 2018 | |
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | $ 321,307 | $ 306,579 |
Acquisitions | 3,063 | 14,066 |
Foreign Exchange Translation | (614) | 662 |
Goodwill, ending balance | 323,756 | 321,307 |
Galvanizing Services [Member] | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | 117,232 | 109,980 |
Acquisitions | 73 | 6,590 |
Foreign Exchange Translation | (614) | 662 |
Goodwill, ending balance | 116,691 | 117,232 |
Energy [Member] | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | 204,075 | 196,599 |
Acquisitions | 2,990 | 7,476 |
Foreign Exchange Translation | 0 | 0 |
Goodwill, ending balance | $ 207,065 | $ 204,075 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Schedule of Amortizable Intangible Assets (Details) - USD ($) $ in Thousands | Feb. 28, 2019 | Feb. 28, 2018 |
Amortizable intangible assets | ||
Finite-lived intangible assets, gross | $ 244,175 | $ 246,833 |
Less accumulated amortization | (122,199) | (105,642) |
Finite-Lived Intangible Assets, Net | 121,976 | 141,191 |
Customer-Related Intangible Assets [Member] | ||
Amortizable intangible assets | ||
Finite-lived intangible assets, gross | 191,460 | 194,712 |
Noncompete Agreements [Member] | ||
Amortizable intangible assets | ||
Finite-lived intangible assets, gross | 8,546 | 7,952 |
Trademarks [Member] | ||
Amortizable intangible assets | ||
Finite-lived intangible assets, gross | 4,569 | 4,569 |
Technology [Member] | ||
Amortizable intangible assets | ||
Finite-lived intangible assets, gross | 7,400 | 7,400 |
Engineering Drawings [Member] | ||
Amortizable intangible assets | ||
Finite-lived intangible assets, gross | 24,600 | 24,600 |
Order or Production Backlog [Member] | ||
Amortizable intangible assets | ||
Finite-lived intangible assets, gross | $ 7,600 | $ 7,600 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Feb. 28, 2019 | Feb. 28, 2018 | Feb. 28, 2017 | |
Finite-Lived Intangible Assets [Line Items] | |||
Amortization of intangible assets | $ 17 | $ 17.1 | $ 16.9 |
Goodwill and Intangible Asset_6
Goodwill and Intangible Assets - Schedule of Future Amortization (Details) - USD ($) $ in Thousands | Feb. 28, 2019 | Feb. 28, 2018 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2015 | $ 16,393 | |
2016 | 16,227 | |
2017 | 14,142 | |
2018 | 13,058 | |
2019 | 11,121 | |
Thereafter | 51,035 | |
Finite-Lived Intangible Assets, Net | $ 121,976 | $ 141,191 |
Goodwill and Intangible Asset_7
Goodwill and Intangible Assets - Indefinite Lived Intangible Assets (Details) - USD ($) $ in Millions | Feb. 28, 2019 | Feb. 28, 2018 |
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-Lived Trade Names | $ 3.4 | $ 2.7 |
- Earnings Per Share (Details)
- Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Feb. 28, 2019 | Nov. 30, 2018 | Aug. 31, 2018 | May 31, 2018 | Feb. 28, 2018 | Nov. 30, 2017 | Aug. 31, 2017 | May 31, 2017 | Feb. 28, 2019 | Feb. 28, 2018 | Feb. 28, 2017 | |
Numerator: | |||||||||||
Net income | $ 8,851 | $ 15,395 | $ 11,244 | $ 15,718 | $ 23,487 | $ (166) | $ 9,786 | $ 12,062 | $ 51,208 | $ 45,169 | $ 61,264 |
Denominator: | |||||||||||
Denominator for basic earnings per common share-weighted average shares (shares) | 26,038,000 | 25,970,000 | 25,965,000 | ||||||||
Effect of dilutive securities: | |||||||||||
Employee and Director stock awards (shares) | 69,000 | 66,000 | 132,000 | ||||||||
Denominator for diluted earnings per common share (shares) | 26,107,000 | 26,036,000 | 26,097,000 | ||||||||
Earnings per share basic and diluted: | |||||||||||
Basic earnings per common share (usd per share) | $ 0.34 | $ 0.59 | $ 0.43 | $ 0.60 | $ 0.91 | $ (0.01) | $ 0.38 | $ 0.46 | $ 1.97 | $ 1.74 | $ 2.36 |
Diluted earnings per common share (usd per share) | $ 0.34 | $ 0.59 | $ 0.43 | $ 0.60 | $ 0.90 | $ (0.01) | $ 0.38 | $ 0.46 | $ 1.96 | $ 1.73 | $ 2.35 |
Earnings Per Share - Narrative
Earnings Per Share - Narrative (Details) shares in Millions | 12 Months Ended |
Feb. 28, 2019shares | |
Earnings Per Share [Abstract] | |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 0.1 |
Stock Compensation - Non-vested
Stock Compensation - Non-vested Restricted Stock Activity (Details) - Restricted Stock Units (RSUs) [Member] | 12 Months Ended |
Feb. 28, 2019$ / 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 | 84,895 |
Vested (shares) | shares | (38,733) |
Forfeited (shares) | shares | (9,407) |
Non-Vested Balance as of February 28, 2019 | shares | 146,532 |
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 | 42.05 |
Vested, Weighted Average Grant Date Fair Value (usd per share) | $ / shares | 54.53 |
Forfeited, Weighted Average Grant Date Fair Value (usd per share) | $ / shares | 53.46 |
Non-Vested Balance as of February 28, 2019 | $ / shares | $ 48.93 |
Stock Compensation Performance
Stock Compensation Performance Share Units (Details) - Performance Shares [Member] - $ / shares | 12 Months Ended | |
Feb. 28, 2019 | 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, Grants in Period, Weighted Average Grant Date Fair Value | $ 42 | |
Non-vested shares outstanding, weighted average grant date fair value (usd per share) | $ 49.74 | $ 54.59 |
Non-vested shares outstanding (shares) | 83,125 | 70,030 |
Granted (shares) | 46,183 | |
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, Forfeited in Period | (29,710) | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Weighted Average Grant Date Fair Value | $ 46.65 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeitures, Weighted Average Grant Date Fair Value | $ 49.51 |
Stock Compensation - SARs and O
Stock Compensation - SARs and Option Awards Activity (Details) - Stock Appreciation Rights (SARs) [Member] - $ / shares | 12 Months Ended | ||
Feb. 28, 2019 | Feb. 28, 2018 | Feb. 28, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments, Number of Shares [Roll Forward] | |||
Outstanding at beginning of year (shares) | 148,513 | 170,139 | 312,748 |
Granted (shares) | 0 | 0 | 0 |
Exercised (shares) | (47,484) | (19,481) | (141,983) |
Forfeited (shares) | (2,845) | (2,145) | (626) |
Outstanding at end of year (shares) | 148,513 | 170,139 | |
Exercisable at end of year (shares) | 98,184 | 148,513 | 126,975 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instrument, Weighted Average Grant Date Fair Value [Roll Forward] | |||
Outstanding at beginning of year, Weighted Average Exercise Price (usd per share) | $ 43.29 | $ 42.02 | $ 34.23 |
Granted, Weighted Average Exercise Price (usd per share) | 0 | 0 | 0 |
Exercised, Weighted Average Exercise Price (usd per share) | 40.84 | 31.94 | 24.85 |
Forfeited, Weighted Average Exercise Price (usd per share) | 43.92 | 45.36 | 43.92 |
Outstanding at end of year, Weighted Average Exercise Price (usd per share) | 44.46 | 43.29 | 42.02 |
Exercisable at end of year, Weighted Average Exercise Price (usd per share) | $ 44.46 | $ 43.29 | $ 41.27 |
Stock Compensation - Schedule B
Stock Compensation - Schedule By Exercise Price Range (Details) - Stock Appreciation Rights (SARs) [Member] - $ / shares | 12 Months Ended | |||
Feb. 28, 2019 | Feb. 28, 2018 | Feb. 28, 2017 | Feb. 29, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total Options/ SAR’s (shares) | 148,513 | 170,139 | 312,748 | |
Weighted Average Exercise Price, Outstanding (usd per share) | $ 44.46 | $ 43.29 | $ 42.02 | $ 34.23 |
Options / SAR’s Currently Exercisable (shares) | 98,184 | 148,513 | 126,975 | |
Weighted Average Exercise Price, Exercisable (usd per share) | $ 44.46 | $ 43.29 | $ 41.27 | |
$39.65 [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Range of Exercise Prices (usd per share) | $ 39.65 | |||
Total Options/ SAR’s (shares) | 950 | |||
Average Remaining Life | 1 year 6 months 8 days | |||
Weighted Average Exercise Price, Outstanding (usd per share) | $ 39.65 | |||
Options / SAR’s Currently Exercisable (shares) | 950 | |||
Weighted Average Exercise Price, Exercisable (usd per share) | $ 39.65 | |||
$43.92 [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Range of Exercise Prices (usd per share) | $ 43.92 | |||
Total Options/ SAR’s (shares) | 54,510 | |||
Average Remaining Life | 2 years 5 days | |||
Weighted Average Exercise Price, Outstanding (usd per share) | $ 43.92 | |||
Options / SAR’s Currently Exercisable (shares) | 54,510 | |||
Weighted Average Exercise Price, Exercisable (usd per share) | $ 43.92 | |||
$45.26 [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Range of Exercise Prices (usd per share) | $ 45.26 | |||
Total Options/ SAR’s (shares) | 40,000 | |||
Average Remaining Life | 1 year 8 months 5 days | |||
Weighted Average Exercise Price, Outstanding (usd per share) | $ 45.26 | |||
Options / SAR’s Currently Exercisable (shares) | 40,000 | |||
Weighted Average Exercise Price, Exercisable (usd per share) | $ 45.26 | |||
$45.36 [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Range of Exercise Prices (usd per share) | $ 45.36 | |||
Total Options/ SAR’s (shares) | 2,724 | |||
Average Remaining Life | 1 year | |||
Weighted Average Exercise Price, Outstanding (usd per share) | $ 45.36 | |||
Options / SAR’s Currently Exercisable (shares) | 2,724 | |||
Weighted Average Exercise Price, Exercisable (usd per share) | $ 45.36 | |||
$39.65 - $45.36 [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total Options/ SAR’s (shares) | 98,184 | |||
Average Remaining Life | 1 year 10 months 3 days | |||
Weighted Average Exercise Price, Outstanding (usd per share) | $ 44.46 | |||
Options / SAR’s Currently Exercisable (shares) | 98,184 | |||
Weighted Average Exercise Price, Exercisable (usd per share) | $ 44.46 |
Stock Compensation (Details Tex
Stock Compensation (Details Textual) | 12 Months Ended | ||
Feb. 28, 2019USD ($)share_based_compensation_plan$ / sharesshares | Feb. 28, 2018USD ($)$ / sharesshares | Feb. 28, 2017USD ($)$ / sharesshares | |
Share Based Compensation (Textual) [Abstract] | |||
Number of share-based compensation plans | share_based_compensation_plan | 2 | ||
Unrecognized compensation cost | $ | $ 6,100,000 | ||
Unrecongized compensation cost, amortization period | 1 year 8 months 17 days | ||
2014 Long Term Incentive Plan [Member] | |||
Share Based Compensation (Textual) [Abstract] | |||
Shares authorized (shares) | 1,500,000 | ||
Share for future issuance (shares) | 1,200,000 | ||
Employee Stock Purchase Plan [Member] | |||
Share Based Compensation (Textual) [Abstract] | |||
Granted option lower than | 85.00% | ||
Restricted common stock under plan | $ | $ 25,000 | ||
Common stock purchased during period (shares) | 5,000 | ||
Directors Grants [Member] | |||
Share Based Compensation (Textual) [Abstract] | |||
Shares of company common stock (shares) | 1,823 | 2,040 | 1,641 |
Value of common stock grants (usd per share) | $ / shares | $ 54.85 | $ 49 | $ 60.94 |
2005 Long Term Incentive Plan [Member] | |||
Share Based Compensation (Textual) [Abstract] | |||
Share for future issuance (shares) | 98,184 | ||
Restricted Stock Units (RSUs) [Member] | |||
Share Based Compensation (Textual) [Abstract] | |||
Vesting ratably term | 3 years | ||
Total fair value of vested shares | $ | $ 2,100,000 | $ 3,000,000 | $ 1,600,000 |
Non-vested shares outstanding (shares) | 146,532 | 109,777 | 134,547 |
Non-vested shares outstanding, weighted average grant date fair value (usd per share) | $ / shares | $ 48.93 | $ 56.62 | $ 51.10 |
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 | 1 year 10 months 1 day | ||
Outstanding aggregate intrinsic value | $ | $ 200,000 |
Stock Compensation - Share-base
Stock Compensation - Share-based Compensation and Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2019 | Feb. 28, 2018 | Feb. 28, 2017 | |
Share based compensation expense and related income tax benefits | |||
Compensation Expense | $ 4,659 | $ 6,121 | $ 5,870 |
Income tax benefits | 978 | 2,122 | 2,055 |
Excess Tax Benefit excluded from cash flow | $ (300) | $ 200 | $ 1,500 |
Debt - Schedule of Long-term D
Debt - Schedule of Long-term Debt (Details) - USD ($) $ in Thousands | Feb. 28, 2019 | Feb. 28, 2018 |
Debt Instrument [Line Items] | ||
Total | $ 240,745 | $ 300,895 |
Debt, Current | 0 | 14,286 |
Total | 241,000 | 301,286 |
Unamortized Debt Issuance Expense | (255) | (391) |
Long-term debt, exculding current maturities | 240,745 | 286,609 |
Senior Notes [Member] | Line of Credit [Member] | ||
Debt Instrument [Line Items] | ||
Total | 116,000 | 162,000 |
Senior Notes [Member] | Unsecured Senior Notes Due January 2021 [Member] | ||
Debt Instrument [Line Items] | ||
Total | 125,000 | 125,000 |
Senior Notes [Member] | Unsecured Senior Notes Due March 2012 through March 2018 [Member] | ||
Debt Instrument [Line Items] | ||
Total | $ 0 | $ 14,286 |
Debt - Narrative (Details)
Debt - Narrative (Details) | Mar. 27, 2013USD ($) | Mar. 31, 2008USD ($)annual_installment | Feb. 28, 2019USD ($) | Feb. 28, 2018USD ($) | Feb. 28, 2017USD ($) | Jan. 21, 2011USD ($) |
Debt Instrument [Line Items] | ||||||
Long-term Debt | $ 240,745,000 | $ 300,895,000 | ||||
Repayments of long term debt | 14,286,000 | 63,504,000 | $ 23,192,000 | |||
Senior Notes [Member] | Line of Credit [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Accordion feature | $ 75,000,000 | |||||
Long-term Debt | 116,000,000 | 162,000,000 | ||||
Covenant, maximum leverage ratio | 3.25 | |||||
Covenant, minimum fixed charge coverage ratio | 3 | |||||
Variable rate description | Eurodollar | |||||
Letters of credit outstanding | 18,700,000 | |||||
Remaining borrowing capacity on line of credit | 315,300,000 | |||||
Senior Notes [Member] | Unsecured Senior Notes Due March 2012 through March 2018 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Long-term Debt | 0 | 14,286,000 | ||||
Debt instrument, face amount | $ 100,000,000 | |||||
Debt instrument, stated percentage | 6.24% | |||||
Number of annual installments | annual_installment | 7 | |||||
Annual installments | $ 14,300,000 | |||||
Senior Notes [Member] | Unsecured Senior Notes Due January 2021 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Long-term Debt | 125,000,000 | $ 125,000,000 | ||||
Covenant, net worth minimum | $ 116,900,000 | |||||
Covenant, minimum retention of future income | 50.00% | |||||
Covenant, minimum fixed charge coverage ratio | 2 | |||||
Debt instrument, face amount | $ 125,000,000 | |||||
Debt instrument, stated percentage | 5.42% | |||||
Covenant, minimum ratio of indebtedness to EBIDTA | 3.25 | |||||
Covenant, maximum percentage of priority indebtedness | 10.00% | |||||
Bank Of America And Other Lenders [Member] | Letter of Credit [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Accordion feature | $ 150,000,000 | |||||
Bank Of America And Other Lenders [Member] | Line of Credit [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Maximum borrowing capacity | 450,000,000 | |||||
Covenant, maximum capital lease obligations | 20,000,000 | |||||
Covenant, maximum investments in foreign subsidiaries | 50,000,000 | |||||
Repayments of long term debt | 75,000,000 | |||||
Revolving Credit Facility [Member] | Bank Of America And Other Lenders [Member] | Line of Credit [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Maximum borrowing capacity | 225,000,000 | |||||
Accordion feature | $ 30,000,000 | |||||
Revolving Credit Facility [Member] | Bank Of America And Other Lenders [Member] | Line of Credit [Member] | Eurodollar [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread | 1.00% | |||||
Revolving Credit Facility [Member] | Bank Of America And Other Lenders [Member] | Line of Credit [Member] | Eurodollar [Member] | Minimum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread | 0.875% | |||||
Commitment fees | 0.175% | |||||
Revolving Credit Facility [Member] | Bank Of America And Other Lenders [Member] | Line of Credit [Member] | Eurodollar [Member] | Maximum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread | 1.875% | |||||
Commitment fees | 0.30% | |||||
Revolving Credit Facility [Member] | Bank Of America And Other Lenders [Member] | Line of Credit [Member] | Base Rate [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread | 0.50% | |||||
Line of Credit [Member] | Bank Of America And Other Lenders [Member] | Line of Credit [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Maximum borrowing capacity | $ 75,000,000 | |||||
Accordion feature | $ 75,000,000 |
Debt - Schedule of Long-term_2
Debt - Schedule of Long-term Debt Maturities (Details) - USD ($) $ in Thousands | Feb. 28, 2019 | Feb. 28, 2018 |
Debt Disclosure [Abstract] | ||
2019 | $ 0 | |
2020 | 125,000 | |
2021 | 0 | |
2022 | 116,000 | |
2023 | 0 | |
Thereafter | 0 | |
Total | $ 241,000 | $ 301,286 |
Operating segments (Details)
Operating segments (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Feb. 28, 2019 | Nov. 30, 2018 | Aug. 31, 2018 | May 31, 2018 | Feb. 28, 2018 | Nov. 30, 2017 | Aug. 31, 2017 | May 31, 2017 | Feb. 28, 2019 | Feb. 28, 2018 | Feb. 28, 2017 | |
Operations and assets by segment | |||||||||||
Revenue, Net | $ 202,548 | $ 239,516 | $ 222,787 | $ 262,236 | $ 200,660 | $ 208,158 | $ 196,329 | $ 205,283 | $ 927,087 | $ 810,430 | $ 863,538 |
Operating Income (Loss) | 76,956 | 48,248 | 98,908 | ||||||||
Depreciation | 50,245 | 50,526 | 50,357 | ||||||||
Payments to acquire property, plant, equipment and acquire businesses, net of cash | 33,616 | 74,397 | 64,113 | ||||||||
Assets | 1,088,570 | 1,028,209 | 1,088,570 | 1,028,209 | |||||||
Property, Plant and Equipment, Net | 210,227 | 216,855 | 210,227 | 216,855 | |||||||
Energy [Member] | |||||||||||
Operations and assets by segment | |||||||||||
Revenue, Net | 486,823 | 421,033 | 488,002 | ||||||||
Operating Income (Loss) | 31,332 | (1,766) | 52,577 | ||||||||
Depreciation | 19,405 | 19,996 | 19,624 | ||||||||
Payments to acquire property, plant, equipment and acquire businesses, net of cash | 14,608 | 32,903 | 31,474 | ||||||||
Assets | 630,134 | 554,866 | 630,134 | 554,866 | |||||||
Galvanizing Services [Member] | |||||||||||
Operations and assets by segment | |||||||||||
Revenue, Net | 440,264 | 389,397 | 375,536 | ||||||||
Operating Income (Loss) | 83,591 | 84,332 | 79,033 | ||||||||
Depreciation | 29,124 | 28,617 | 28,650 | ||||||||
Payments to acquire property, plant, equipment and acquire businesses, net of cash | 16,046 | 39,474 | 32,099 | ||||||||
Assets | 440,090 | 460,575 | 440,090 | 460,575 | |||||||
Corporate, Non-Segment [Member] | |||||||||||
Operations and assets by segment | |||||||||||
Operating Income (Loss) | (37,967) | (34,318) | (32,702) | ||||||||
Depreciation | 1,716 | 1,913 | 2,083 | ||||||||
Payments to acquire property, plant, equipment and acquire businesses, net of cash | 2,962 | 2,020 | 540 | ||||||||
Assets | 18,346 | 12,768 | 18,346 | 12,768 | |||||||
UNITED STATES | |||||||||||
Operations and assets by segment | |||||||||||
Revenue, Net | 785,194 | 653,150 | 705,820 | ||||||||
Property, Plant and Equipment, Net | 189,281 | 194,418 | 189,281 | 194,418 | |||||||
Non-US [Member] | |||||||||||
Operations and assets by segment | |||||||||||
Property, Plant and Equipment, Net | 3,985 | 4,183 | 3,985 | 4,183 | |||||||
CANADA | |||||||||||
Operations and assets by segment | |||||||||||
Property, Plant and Equipment, Net | $ 16,961 | $ 18,254 | 16,961 | 18,254 | |||||||
Other Countries [Member] | |||||||||||
Operations and assets by segment | |||||||||||
Revenue, Net | $ 141,893 | $ 157,280 | $ 157,718 |
Leases - Lease Cost (Details)
Leases - Lease Cost (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Feb. 28, 2019 | Feb. 28, 2018 | Feb. 28, 2017 | |
Leases [Abstract] | |||
Operating lease, cost | $ 15.6 | $ 13.9 | $ 17 |
Leases - Lease Maturity (Detail
Leases - Lease Maturity (Details) $ in Thousands | Feb. 28, 2019USD ($) |
Leases [Abstract] | |
2020 | $ 7,882 |
2021 | 7,185 |
2022 | 6,803 |
2023 | 6,454 |
2024 | 5,771 |
Thereafter | 24,718 |
Total lease payments | 58,813 |
Less imputed interest | (11,966) |
Total | $ 46,847 |
Leases - Future Lease Liability
Leases - Future Lease Liability Prior to the Adoption of ASC 842 (Details) $ in Thousands | Feb. 28, 2018USD ($) |
Leases [Abstract] | |
2019 | $ 7,336 |
2020 | 6,053 |
2021 | 5,057 |
2022 | 4,924 |
2023 | 4,781 |
Thereafter | 25,017 |
Total | $ 53,168 |
Leases - Lease Details (Details
Leases - Lease Details (Details) $ in Thousands | 12 Months Ended |
Feb. 28, 2019USD ($) | |
Lease, Cost [Abstract] | |
Operating cash flows from operating leases included in lease liabilities | $ 8,454 |
ROU assets obtained in exchange for new operating lease liabilities | $ 10,948 |
Weighted-average remaining lease term - operating leases | 9 years 2 months 23 days |
Weighted-average discount rate - operating leases | 5.13% |
Commitments and Contingencies -
Commitments and Contingencies - Product Warranty Accrual (Details) - USD ($) $ in Thousands | Feb. 28, 2019 | Feb. 28, 2018 |
Loss Contingencies [Line Items] | ||
Accrued warranty | $ 1,751 | $ 2,013 |
Energy [Member] | ||
Loss Contingencies [Line Items] | ||
Letters of credit outstanding | $ 44,300 |
Acquisitions Acquisitions (Deta
Acquisitions Acquisitions (Details) $ in Thousands | 12 Months Ended |
Feb. 28, 2019USD ($) | |
Business Combinations (textual) [Abstract] | |
Payments to Acquire Businesses, Net of Cash Acquired | $ 8,000 |
Business Acquisition, Description of Acquired Entity | These acquisitions were not significant individually or in the aggregate for any fiscal year. |
Quarterly Financial Informati_3
Quarterly Financial Information, Unaudited (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Feb. 28, 2019 | Nov. 30, 2018 | Aug. 31, 2018 | May 31, 2018 | Feb. 28, 2018 | Nov. 30, 2017 | Aug. 31, 2017 | May 31, 2017 | Feb. 28, 2019 | Feb. 28, 2018 | Feb. 28, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Net sales | $ 202,548 | $ 239,516 | $ 222,787 | $ 262,236 | $ 200,660 | $ 208,158 | $ 196,329 | $ 205,283 | $ 927,087 | $ 810,430 | $ 863,538 |
Gross profit | 43,257 | 49,755 | 46,904 | 58,705 | 38,010 | 31,117 | 43,800 | 47,382 | 198,621 | 160,309 | 205,332 |
Net income | $ 8,851 | $ 15,395 | $ 11,244 | $ 15,718 | $ 23,487 | $ (166) | $ 9,786 | $ 12,062 | $ 51,208 | $ 45,169 | $ 61,264 |
Basic earnings per common share (usd per share) | $ 0.34 | $ 0.59 | $ 0.43 | $ 0.60 | $ 0.91 | $ (0.01) | $ 0.38 | $ 0.46 | $ 1.97 | $ 1.74 | $ 2.36 |
Diluted earnings per common share (usd per share) | $ 0.34 | $ 0.59 | $ 0.43 | $ 0.60 | $ 0.90 | $ (0.01) | $ 0.38 | $ 0.46 | $ 1.96 | $ 1.73 | $ 2.35 |
Schedule II _ Valuation and Q_2
Schedule II : Valuation and Qualiying Accounts and Reserves (Details) - Allowance for Doubtful Accounts [Member] - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2019 | Feb. 28, 2018 | Feb. 28, 2017 | |
Allowance for Doubtful Accounts | |||
Balance at Beginning of year | $ 569 | $ 347 | $ 264 |
Valuation Allowances and Reserves, Adjustments | 2,153 | 3,290 | 48 |
Valuation Allowances and Reserves, Deductions | (451) | (3,084) | 20 |
Valuation Allowances and Reserves, Period Increase (Decrease) | (4) | 0 | 4 |
Valuation Allowances and Reserves, Adjustments | 0 | 16 | 11 |
Balance at end of year | $ 2,267 | $ 569 | $ 347 |