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BUSINESS SEGMENTS | 12 Months Ended
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Aug. 31, 2020
Segment Reporting [Abstract] |
BUSINESS SEGMENTS | NOTE 21. 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 ("CODM") to make decisions about resources to be allocated to the segments and to assess performance. The Company's CODM is identified as the Chief Executive Officer, the Chief Operating Officer and the Chief Financial Officer. In the fourth quarter of 2020, the Company realigned its segment reporting structure to reflect: (i) its vertically integrated operating model in North America, which is now supported by a National Sales, Inventory and Operations Planning function created in 2020, (ii) changes to its operating model and geographic footprint following the full integration of the Acquired Businesses into its North America operations and (iii) the way the CODM now uses integrated North America data to manage the business, assess performance and allocate resources. The Company structures its business into the following two operating and reportable segments: North America and Europe. The reportable segments have different lines of management responsibility, as each requires different marketing strategies and management expertise. Segment financial information has been retrospectively adjusted to reflect these changes. See Note 1, Nature of Operations, for more information about the reporting segments, including the types of products and services from which each reportable segment derives its net sales. Corporate and Other contains earnings or losses on assets and liabilities related to the Company's BRP and short-term investments, expenses of the Company's corporate headquarters, interest expense related to its long-term debt and intercompany eliminations. 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 CODM uses adjusted EBITDA from continuing operations to evaluate segment performance and allocate resources. 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. The following table summarizes certain financial information from continuing operations by reportable segment:
(in thousands) |  | North America |  | Europe |  | Corporate and Other |  | Continuing Operations
2020 |  |  |  |  |  |  |  |
Net sales |  | $ | 4,769,933 |  |  | $ | 699,140 |  |  | $ | 7,413 |  |  | $ | 5,476,486 |
Adjusted EBITDA |  | 661,176 |  |  | 62,007 |  |  | (146,575) |  |  | 576,608 |
Interest expense(1) |  | 48,413 |  |  | 982 |  |  | 12,442 |  |  | 61,837 |
Capital expenditures |  | 127,982 |  |  | 48,895 |  |  | 10,741 |  |  | 187,618 |
Depreciation and amortization |  | 132,492 |  |  | 25,674 |  |  | 7,583 |  |  | 165,749 |
Asset impairments |  | 7,606 |  |  | 5 |  |  | — |  |  | 7,611 |
Total assets(2) |  | 2,862,805 |  |  | 532,850 |  |  | 686,073 |  |  | 4,081,728 |
2019 |  |  |  |  |  |  |  |
Net sales |  | $ | 5,001,116 |  |  | $ | 817,048 |  |  | $ | 10,838 |  |  | $ | 5,829,002 |
Adjusted EBITDA |  | 456,296 |  |  | 100,102 |  |  | (132,313) |  |  | 424,085 |
Interest expense(1) |  | 46,939 |  |  | 2,493 |  |  | 21,941 |  |  | 71,373 |
Capital expenditures |  | 89,119 |  |  | 40,337 |  |  | 9,380 |  |  | 138,836 |
Depreciation and amortization |  | 125,718 |  |  | 25,993 |  |  | 6,941 |  |  | 158,652 |
Asset impairments |  | 369 |  |  | 15 |  |  | — |  |  | 384 |
Total assets(2) |  | 2,991,996 |  |  | 464,177 |  |  | 302,598 |  |  | 3,758,771 |
2018 |  |  |  |  |  |  |  |
Net sales |  | $ | 3,738,493 |  |  | $ | 887,038 |  |  | $ | 18,192 |  |  | $ | 4,643,723 |
Adjusted EBITDA |  | 323,993 |  |  | 131,720 |  |  | (103,492) |  |  | 352,221 |
Interest expense(1) |  | 23,217 |  |  | 2,699 |  |  | 15,041 |  |  | 40,957 |
Capital expenditures |  | 144,007 |  |  | 23,552 |  |  | 3,808 |  |  | 171,367 |
Depreciation and amortization |  | 92,295 |  |  | 27,255 |  |  | 11,958 |  |  | 131,508 |
Asset impairments |  | 14,345 |  |  | 27 |  |  | — |  |  | 14,372 |
Total assets(2) |  | 2,115,049 |  |  | 485,548 |  |  | 727,707 |  |  | 3,328,304 |
__________________________________ (1) Includes intercompany interest expense in the segments, which is eliminated within Corporate and Other. (2) 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) |  | 2020 |  | 2019 |  | 2018
Earnings from continuing operations |  | $ | 278,302 |  |  | $ | 198,779 |  |  | $ | 135,237 |
Interest expense |  | 61,837 |  |  | 71,373 |  |  | 40,957 |
Income taxes |  | 92,476 |  |  | 69,681 |  |  | 30,147 |
Depreciation and amortization |  | 165,749 |  |  | 158,652 |  |  | 131,508 |
Amortization of acquired unfavorable contract backlog |  | (29,367) |  |  | (74,784) |  |  | — |
Asset impairments |  | 7,611 |  |  | 384 |  |  | 14,372 |
Adjusted EBITDA from continuing operations |  | $ | 576,608 |  |  | $ | 424,085 |  |  | $ | 352,221 |
The following tables present net sales by reportable segment disaggregated by major product and geographic area:
|  | Year Ended August 31, 2020 |  |  |  |  |  |
(in thousands) |  | North America |  | Europe |  | Corporate |  | Total
Major product: |  |  |  |  |  |  |  |
Raw material products |  | $ | 718,513 |  |  | $ | 9,692 |  |  | $ | — |  |  | $ | 728,205 |
Steel products |  | 1,738,556 |  |  | 547,047 |  |  | — |  |  | 2,285,603 |
Downstream products |  | 1,943,126 |  |  | 119,232 |  |  | — |  |  | 2,062,358 |
Other |  | 369,738 |  |  | 21,660 |  |  | 8,922 |  |  | 400,320 |
Net sales-unaffiliated customers |  | 4,769,933 |  |  | 697,631 |  |  | 8,922 |  |  | 5,476,486 |
Intersegment net sales, eliminated on consolidation |  | — |  |  | 1,509 |  |  | (1,509) |  |  | — |
Net sales |  | $ | 4,769,933 |  |  | $ | 699,140 |  |  | $ | 7,413 |  |  | $ | 5,476,486 |
|  | Year Ended August 31, 2019 |  |  |  |  |  |
(in thousands) |  | North America |  | Europe |  | Corporate |  | Total
Major product: |  |  |  |  |  |  |  |
Raw material products |  | $ | 953,858 |  |  | $ | 12,359 |  |  | $ | — |  |  | $ | 966,217 |
Steel products |  | 1,763,017 |  |  | 646,974 |  |  | — |  |  | 2,409,991 |
Downstream products |  | 1,936,994 |  |  | 133,823 |  |  | — |  |  | 2,070,817 |
Other |  | 347,247 |  |  | 22,567 |  |  | 12,163 |  |  | 381,977 |
Net sales-unaffiliated customers |  | 5,001,116 |  |  | 815,723 |  |  | 12,163 |  |  | 5,829,002 |
Intersegment net sales, eliminated on consolidation |  | — |  |  | 1,325 |  |  | (1,325) |  |  | — |
Net sales |  | $ | 5,001,116 |  |  | $ | 817,048 |  |  | $ | 10,838 |  |  | $ | 5,829,002 |
|  | Year Ended August 31, 2018* |  |  |  |  |  |
(in thousands) |  | North America |  | Europe |  | Corporate |  | Total
Major product: |  |  |  |  |  |  |  |
Raw material products |  | $ | 1,165,998 |  |  | $ | 15,213 |  |  | $ | — |  |  | $ | 1,181,211 |
Steel products |  | 1,099,286 |  |  | 710,657 |  |  | — |  |  | 1,809,943 |
Downstream products |  | 1,160,373 |  |  | 142,745 |  |  | — |  |  | 1,303,118 |
Other |  | 312,810 |  |  | 17,304 |  |  | 19,337 |  |  | 349,451 |
Net sales-unaffiliated customers |  | 3,738,467 |  |  | 885,919 |  |  | 19,337 |  |  | 4,643,723 |
Intersegment net sales, eliminated on consolidation |  | 26 |  |  | 1,119 |  |  | (1,145) |  |  | — |
Net sales |  | $ | 3,738,493 |  |  | $ | 887,038 |  |  | $ | 18,192 |  |  | $ | 4,643,723 |
|  | Year Ended August 31, |  |  |  |
(in thousands) |  | 2020 |  | 2019 |  | 2018*
Geographic area: |  |  |  |  |  |
United States |  | $ | 4,562,351 |  |  | $ | 4,771,164 |  |  | $ | 3,460,018 |
Poland |  | 549,983 |  |  | 510,610 |  |  | 702,540 |
China |  | 76,909 |  |  | 74,638 |  |  | 163,622 |
Germany |  | 65,846 |  |  | 103,762 |  |  | 70,754 |
Other |  | 221,397 |  |  | 368,828 |  |  | 246,789 |
Net sales |  | $ | 5,476,486 |  |  | $ | 5,829,002 |  |  | $ | 4,643,723 |
__________________________________ * Prior period amounts have been reported under ASC 605. The following table presents long-lived assets, net of accumulated depreciation and amortization, by geographic area:
|  | August 31, |  |  |  |
(in thousands) |  | 2020 |  | 2019 |  | 2018
United States |  | $ | 1,483,127 |  |  | $ | 1,426,131 |  |  | $ | 1,001,102 |
Poland |  | 225,166 |  |  | 173,045 |  |  | 171,460 |
Other |  | 51 |  |  | 42 |  |  | 45 |
Total long-lived assets |  | $ | 1,708,344 |  |  | $ | 1,599,218 |  |  | $ | 1,172,607 |

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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://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8924-108599 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8981-108599 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8721-108599 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9031-108599 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (f) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (e) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 22 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8736-108599 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9054-108599 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8657-108599 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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