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BUSINESS SEGMENTS | 12 Months Ended
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Aug. 31, 2019
Segment Reporting [Abstract] |
BUSINESS SEGMENTS | The Company's operating segments engage in business activities from which they may earn revenues and incur expenses and for which discrete financial information is available. Operating results for the operating segments are regularly reviewed by the Company's chief operating decision maker to make decisions about resources to be allocated to the segments and to assess performance. The Company's chief operating decision maker is identified as the Chief Executive Officer. Operating segments are aggregated for reporting purposes when the operating segments are identified as similar in accordance with the basic principles and aggregation criteria in the accounting standards. The Company's reporting segments are based primarily on product lines and secondarily on geographic area. The reporting segments have different lines of management responsibility as each business requires different marketing strategies and management expertise. The Company structures its business into the following four reporting segments: Americas Recycling, Americas Mills, Americas Fabrication and International Mill. See Note 1, Nature of Operations, for more information about the reporting segments, including the types of products and services from which each reporting segment derives its net sales. During 2018, the Company substantially completed the exit of the International Marketing and Distribution segment. See Note 4, Changes in Business, for further information. Certain components of the International Marketing and Distribution segment which were wound down in prior periods, including the Company's steel trading operations based in the United Kingdom, did not meet the criteria for discontinued operations, and thus, were included in continuing operations for all periods presented. These activities were included in the results of Corporate and Other, and were immaterial in 2018. Corporate and Other contains earnings or losses on assets and liabilities related to the Company's BRP and short-term investments, expenses of the Company's corporate headquarters, interest expense related to its long-term debt and intercompany eliminations. The Company uses adjusted EBITDA from continuing operations to compare and evaluate the financial performance of its segments. Adjusted EBITDA is the sum of the Company's earnings from continuing operations before interest expense, income taxes, depreciation and amortization expense, and impairment expense. Intersegment sales are generally priced at prevailing market prices. Certain corporate administrative expenses are allocated to the segments based upon the nature of the expense. The accounting policies of the segments are the same as those described in Note 2, Summary of Significant Accounting Policies. The following table summarizes certain financial information from continuing operations by reportable segment:
(in thousands) |  | Americas Recycling |  | Americas Mills |  | Americas Fabrication |  | International Mill |  | Corporate and Other |  | Continuing Operations
2019 |  |  |  |  |  |  |  |  |  |  |  |
Net sales-unaffiliated customers |  | $ | 908,451 |  |  | $ | 1,882,994 |  |  | $ | 2,209,671 |  |  | $ | 815,723 |  |  | $ | 12,163 |  |  | $ | 5,829,002 |
Intersegment sales |  | 238,095 |  |  | 1,185,280 |  |  | 13,708 |  |  | 1,325 |  |  | (1,438,408 | ) |  | — |
Net sales |  | 1,146,546 |  |  | 3,068,274 |  |  | 2,223,379 |  |  | 817,048 |  |  | (1,426,245 | ) |  | 5,829,002 |
Adjusted EBITDA |  | 42,124 |  |  | 545,215 |  |  | (123,014 | ) |  | 100,102 |  |  | (140,342 | ) |  | 424,085 |
Interest expense* |  | 3,097 |  |  | 16,186 |  |  | 27,656 |  |  | 2,493 |  |  | 21,941 |  |  | 71,373 |
Capital expenditures |  | 22,560 |  |  | 54,069 |  |  | 12,490 |  |  | 40,337 |  |  | 9,380 |  |  | 138,836 |
Depreciation and amortization |  | 16,825 |  |  | 91,326 |  |  | 17,567 |  |  | 25,993 |  |  | 6,941 |  |  | 158,652 |
Impairment of assets |  | — |  |  | — |  |  | 369 |  |  | 15 |  |  | — |  |  | 384 |
Total assets** |  | 257,517 |  |  | 1,667,366 |  |  | 1,106,420 |  |  | 464,177 |  |  | 263,291 |  |  | 3,758,771 |
2018 |  |  |  |  |  |  |  |  |  |  |  |
Net sales-unaffiliated customers |  | $ | 1,117,714 |  |  | $ | 1,204,181 |  |  | $ | 1,416,572 |  |  | $ | 885,919 |  |  | $ | 19,337 |  |  | $ | 4,643,723 |
Intersegment sales |  | 247,715 |  |  | 792,722 |  |  | 11,310 |  |  | 1,119 |  |  | (1,052,866 | ) |  | — |
Net sales |  | 1,365,429 |  |  | 1,996,903 |  |  | 1,427,882 |  |  | 887,038 |  |  | (1,033,529 | ) |  | 4,643,723 |
Adjusted EBITDA |  | 68,694 |  |  | 301,805 |  |  | (39,394 | ) |  | 131,720 |  |  | (110,604 | ) |  | 352,221 |
Interest expense* |  | 3,605 |  |  | 5,317 |  |  | 14,295 |  |  | 2,699 |  |  | 15,041 |  |  | 40,957 |
Capital expenditures |  | 8,592 |  |  | 121,029 |  |  | 14,386 |  |  | 23,552 |  |  | 3,808 |  |  | 171,367 |
Depreciation and amortization |  | 17,246 |  |  | 61,512 |  |  | 13,537 |  |  | 27,255 |  |  | 11,958 |  |  | 131,508 |
Impairment of assets |  | 180 |  |  | 8 |  |  | 14,157 |  |  | 27 |  |  | — |  |  | 14,372 |
Total assets** |  | 291,838 |  |  | 1,115,339 |  |  | 739,151 |  |  | 485,548 |  |  | 696,428 |  |  | 3,328,304 |
2017 |  |  |  |  |  |  |  |  |  |  |  |
Net sales-unaffiliated customers |  | $ | 865,462 |  |  | $ | 917,689 |  |  | $ | 1,364,826 |  |  | $ | 636,402 |  |  | $ | 59,690 |  |  | $ | 3,844,069 |
Intersegment sales |  | 146,038 |  |  | 647,765 |  |  | 11,102 |  |  | 871 |  |  | (805,776 | ) |  | — |
Net sales |  | 1,011,500 |  |  | 1,565,454 |  |  | 1,375,928 |  |  | 637,273 |  |  | (746,086 | ) |  | 3,844,069 |
Adjusted EBITDA |  | 33,541 |  |  | 224,183 |  |  | 27,259 |  |  | 76,068 |  |  | (125,229 | ) |  | 235,822 |
Interest expense* |  | 2,979 |  |  | (3,394 | ) |  | 9,899 |  |  | 3,079 |  |  | 31,588 |  |  | 44,151 |
Capital expenditures |  | 7,148 |  |  | 172,738 |  |  | 15,495 |  |  | 12,603 |  |  | 5,090 |  |  | 213,074 |
Depreciation and amortization |  | 15,501 |  |  | 49,419 |  |  | 13,400 |  |  | 25,830 |  |  | 20,340 |  |  | 124,490 |
Impairment of assets |  | 559 |  |  | — |  |  | — |  |  | 150 |  |  | 1,021 |  |  | 1,730 |
Total assets** |  | 240,371 |  |  | 933,022 |  |  | 683,609 |  |  | 464,428 |  |  | 653,701 |  |  | 2,975,131 |
________________________ * Includes intercompany interest expense (income) in the segments, which is eliminated within Corporate and Other. ** Total assets listed in Corporate and Other includes assets from discontinued operations. The following table presents a reconciliation of earnings from continuing operations to adjusted EBITDA from continuing operations:
|  | Year Ended August 31,
(in thousands) |  | 2019 |  | 2018 |  | 2017
Earnings from continuing operations |  | $ | 198,779 |  |  | $ | 135,237 |  |  | $ | 50,175 |
Interest expense |  | 71,373 |  |  | 40,957 |  |  | 44,151 |
Income taxes |  | 69,681 |  |  | 30,147 |  |  | 15,276 |
Depreciation and amortization |  | 158,652 |  |  | 131,508 |  |  | 124,490 |
Amortization of acquired unfavorable contract backlog |  | (74,784 | ) |  | — |  |  | — |
Impairment of assets |  | 384 |  |  | 14,372 |  |  | 1,730 |
Adjusted EBITDA from continuing operations |  | $ | 424,085 |  |  | $ | 352,221 |  |  | $ | 235,822 |
The following table present the Company's external net sales from continuing operations by major geographic area:
|  | Year Ended August 31,
(in thousands) |  | 2019 |  | 2018 |  | 2017
Geographic area: |  |  |  |  |  |
North America |  | $ | 4,843,985 |  |  | $ | 3,535,499 |  |  | $ | 3,015,481 |
Europe |  | 833,627 |  |  | 892,452 |  |  | 666,396 |
Asia and other |  | 151,390 |  |  | 215,772 |  |  | 162,192 |
Net sales |  | $ | 5,829,002 |  |  | $ | 4,643,723 |  |  | $ | 3,844,069 |
The following table presents long-lived assets, net of accumulated depreciation and amortization, by geographic area:
|  | August 31,
(in thousands) |  | 2019 |  | 2018 |  | 2017
United States |  | $ | 1,426,131 |  |  | $ | 1,001,102 |  |  | $ | 971,881 |
Europe and other |  | 173,087 |  |  | 171,505 |  |  | 187,995 |
Total long-lived assets |  | $ | 1,599,218 |  |  | $ | 1,172,607 |  |  | $ | 1,159,876 |

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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