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Discontinued Operations | 3 Months Ended
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May 31, 2023
Discontinued Operations and Disposal Groups [Abstract] |
Discontinued Operations | 3. Discontinued Operations On September 30, 2022, AZZ contributed its AZZ Infrastructure Solutions segment, excluding AZZ Crowley Tubing ("AIS") to a joint venture, AIS Investment Holdings LLC (the "AVAIL JV") and sold a 60% interest in the AVAIL JV to Fernweh Group LLC ("Fernweh"). The divestiture was part of the Company's plan to divest of non-core businesses. On September 30, 2022, the AVAIL JV was deconsolidated. Beginning October 1, 2022, the Company's retained 40% interest in the AVAIL JV is included in the AZZ Infrastructure Solutions segment and is accounted for under the equity method of accounting. The divestiture of the AZZ Infrastructure Solutions segment represents an intentional strategic shift in our operations and will allow the Company to become a focused provider of coating and galvanizing solutions for critical applications. As a result, the results of the AIS segment were classified as discontinued operations in our condensed statements of operations and excluded from both continuing operations and segment results for the three months ended May 31, 2022. The results of operations from discontinued operations for the three months ended May 31, 2022, have been reflected as discontinued operations in the consolidated statements of operations and consist of the following (in thousands):
|  | Three Months Ended |  |
|  |  | May 31, 2022 |  |  |  |
Sales |  |  | $ | 107,264 |  |  |  |  |
Cost of sales |  |  | 82,861 |  |  |  |  |
Gross margin |  |  | 24,403 |  |  |  |  |
Selling, general and administrative |  |  | 12,402 |  |  |  |  |
Operating income from discontinued operations |  |  | 12,001 |  |  |  |  |
Interest expense |  |  | 1 |  |  |  |  |
Other (income) expense, net |  |  | 825 |  |  |  |  |
Income from discontinued operations before income tax |  |  | 11,175 |  |  |  |  |
Income tax expense |  |  | 2,451 |  |  |  |  |
Net income from discontinued operations |  |  | $ | 8,724 |  |  |  |  |
Earnings per common share from discontinued operations: |  |  |  |  |  |  |
Basic earnings per share |  |  | $ | 0.35 |  |  |  |  |
Diluted earnings per share |  |  | $ | 0.34 |  |  |  |  |
We have included the net cash provided by discontinued operations in the consolidated statements of cash flows. The depreciation, amortization, capital expenditures, and significant operating and investing non-cash items of the discontinued operations consist of the following (in thousands):
| Three Months Ended May 31, 2022
Depreciation and amortization | $ | 3,146 |
Purchase of property, plant and equipment | 1,336 |
Loss on sale of property, plant and equipment | 5 |

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- Definition The entire disclosure related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -URI https://asc.fasb.org/topic&trid=2155823 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -URI https://asc.fasb.org/subtopic&trid=2122178 + Details
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