Accounts Receivable

9 Months Ended

May 31, 2025

Accounts receivables at May 31, 2025 and August 31, 2024 consisted of the following:


	May 31, 2025		August 31, 2024
Accounts receivable	$	432,845	$	434,490
Less: allowance for credit losses	22,292		22,368
Accounts receivable, net	$	410,553	$	412,122

In the second quarter of fiscal year 2023, the Company entered into a Receivables Purchase Agreement (the “RPA”), by and among MSC A/R Holding Co., LLC, a wholly owned subsidiary of the Company (the “Receivables Subsidiary”), as seller, the Company, as master servicer, certain purchasers from time to time party thereto (collectively, the “Purchasers”), and Wells Fargo Bank, National Association, as administrative agent. Under the RPA, the Receivables Subsidiary may sell certain eligible receivables to the Purchasers in amounts up to $300,000. The RPA matures on December 19, 2025 and is subject to customary termination events related to transactions of this type.

The Company continues to provide collection services for the receivables sold to the Purchasers. As cash is collected on sold receivables, the Receivables Subsidiary continuously sells new qualifying receivables to the Purchasers so that the total principal amount outstanding of receivables sold is approximately $300,000. During the thirteen- and thirty-nine-week periods ended May 31, 2025, receivables sold and collected under the RPA was $312,646 and $944,941, respectively. The total principal amount outstanding of receivables sold was approximately $300,000 as of May 31, 2025 and August 31, 2024. The amount of receivables retained and pledged as collateral by the Company as of May 31, 2025 and August 31, 2024 was $327,603 and $349,743, respectively.

The receivables sold incurred fees due to the Purchasers of $3,846 and $11,911 during the thirteen- and thirty-nine-week periods ended May 31, 2025, respectively, and $4,605 and $13,832 during the thirteen- and thirty-nine-week periods ended June 1, 2024 which were recorded within Other expense, net in the unaudited Condensed Consolidated Statements of Income. The financial covenants under the RPA are substantially the same as those under the Credit Facilities and the Private Placement Debt (each, as defined below). See Note 9, “Debt” for more information about these financial covenants.