IRVING, Texas, Oct. 26,
2017 /PRNewswire/ -- Commercial Metals Company (NYSE: CMC) today
announced financial results for its fiscal fourth quarter and year
ended August 31, 2017. For the three months ended
August 31, 2017, the loss from continuing operations was
$32.7 million, or $0.28 per diluted share, on net sales of
$1.3 billion compared to a loss from
continuing operations of $2.1
million, or $0.02 per diluted
share, on net sales of $1.1 billion
for the three months ended August 31, 2016. For the
fiscal year ended August 31, 2017, earnings from continuing
operations were $32.6 million, or
$0.27 per diluted share, on net sales
of $4.6 billion. This compares to
earnings from continuing operations of $57.9
million, or $0.50 per diluted
share, on net sales of $4.2 billion
for the fiscal year ended August 31, 2016.
Included in the loss from continuing operations for the three
months ended August 31, 2017 were net
after-tax costs associated with the refinancing activities
completed in the fourth quarter of $11.6
million or $0.10 per diluted
share, costs associated with the exit of the International
Marketing and Distribution segment of $23.2
million or $0.20 per diluted
share and severance costs of $5.3
million or $0.05 per diluted
share. Included in the results for the three months ended
August 31, 2016 were impairment
charges on long-lived assets of $24.3
million or $0.21 per diluted
share.
As a result of the sale of CMC Cometals, which was completed on
August 31, 2017, the results of this
division have been reflected as discontinued operations in all
reported periods. Included in the earnings from discontinued
operations for the three months ended August
31, 2017 is an after-tax loss on the sale of the CMC
Cometals division of $4.5 million or
$0.04 per diluted share.
At August 31, 2017, cash and cash equivalents were
$252.6 million and available
credit and accounts receivable facilities were $490.6 million. As a result of the
refinancing of notes due in 2017 and 2018 during the most recent
fiscal quarter, the Company has reduced its long-term debt by
approximately $240 million since
May 31, 2017 and, has no significant
debt maturities for the next 5 years. The Company is also
positioned to have reduced cash interest costs going forward in
excess of $25 million per year.
Barbara Smith, President and CEO,
commented, "The Company took action during fiscal 2017 to
reallocate capital to our core manufacturing operations and improve
our financial profile. The refinancing activities have
strengthened our balance sheet to provide lower debt service cost
and extend our debt maturity profile. We made good progress
regarding our decision to exit the International Marketing and
Distribution segment in order to focus our resources on the
attractive long product markets in the U.S. and Poland. The
Polish operations are taking full advantage of the new furnace and
caster investments to produce more and higher value merchant
product, and, in the U.S., we look forward to the commissioning of
our new micro mill in Durant,
Oklahoma, which is scheduled to begin in our fiscal second
quarter of 2018."
On October 24, 2017, the board of
directors of CMC declared a quarterly dividend of $0.12 per share of CMC common stock for
stockholders of record on November 8, 2017. The dividend
will be paid on November 22, 2017.
Business Segments - Fiscal Fourth Quarter 2017
Review
Our Americas Recycling segment recorded adjusted
operating profit of $2.9 million for
the fourth quarter of fiscal 2017, compared to adjusted operating
loss of $45.1 million for the fourth
quarter of fiscal 2016. The fourth quarter of fiscal 2016 loss was
largely due to a $38.9 million
pre-tax impairment charge related to long-lived assets in our
Americas Recycling segment. Shipments increased 37% in comparison
to the same period of the prior year as flows through the yards
remained strong and as a result of the seven recycling yards that
were acquired earlier in fiscal 2017.
Our Americas Mills segment recorded adjusted operating profit of
$29.8 million for the fourth quarter
of fiscal 2017, compared to an adjusted operating profit of
$45.0 million for the fourth quarter
of fiscal 2016. Despite strong long-steel demand which resulted in
an 8% increase in shipments in comparison to the same period of the
prior year, cost pressures squeezed margins during the quarter.
Our Americas Fabrication segment recorded an adjusted operating
loss of $4.9 million for the fourth
quarter of fiscal 2017, compared to adjusted operating profit of
$9.6 million for the fourth quarter
of fiscal 2016. The decrease in adjusted operating profit for the
fourth quarter of fiscal 2017 was due to a very competitive
fabrication market. This has resulted in newly awarded
contracts being at lower selling prices than in the prior year
despite also incurring higher steel input costs.
Our International Mill segment recorded adjusted operating
profit of $14.6 million for the
fourth quarter of fiscal 2017, compared to adjusted operating
profit of $18.7 million for the
fourth quarter of fiscal 2016. Despite the quarterly results
being lower than the prior year, shipped volumes were 16% higher in
comparison to the same period of the prior year while producing
strong earnings throughout fiscal 2017. A strong construction
market in conjunction with an expansion of higher margin merchant
volumes were the main contributor to the results.
Outlook
"Our outlook is somewhat different when we
think about our U.S. operations compared to our Polish operations,"
explained Ms. Smith.
"Our outlook for demand from the U.S. non-residential
construction market remains quite positive, in spite of a lack of
movement on infrastructure stimulus. However, market
conditions remain very challenging as a result of raw material
price changes and escalating input costs. Metal margins
remain under pressure due to the ongoing influx of dumped and
subsidized imports. We saw a temporary pause in rebar imports
after the announcement of the Section 232 review into the effect of
imports on national security. However, recent data indicates
another surge in rebar imports is on its way. We believe that
no action taken by the current Administration to address these
unfair trade practices is likely to result in imports returning to
their previous high levels, negatively impacting the industry's
operating results or potentially even imperiling the long-term
viability of the U.S. steel industry."
"Poland, however, provides a
welcome contrast to the U.S. market. Poland and the E.U. have implemented trade
measures necessary to provide a level playing field. This,
coupled with the fact that there is good support and financial
funding for infrastructure development provides a good demand
outlook for our Polish operations."
Conference Call
CMC invites you to listen to a live
broadcast of its fourth quarter fiscal 2017 conference call today,
Thursday, October 26, 2017, at 11:00
a.m. ET. Barbara Smith,
President and CEO, and Mary Lindsey,
Senior Vice President and CFO, will host the call. The call
is accessible via our website at www.cmc.com. In the event
you are unable to listen to the live broadcast, the call will be
archived and available for replay on our website on the next
business day. Financial and statistical information presented
in the broadcast are located on CMC's website under
"Investors".
Commercial Metals Company and its subsidiaries manufacture,
recycle and market steel and metal products, related materials and
services through a network including four electric arc furnace
("EAF") mini mills, an EAF micro mill, a rerolling mill, steel
fabrication and processing plants, construction-related product
warehouses, metal recycling facilities and marketing and
distribution offices in the United
States and in strategic international markets.
Forward-Looking Statements
This news release contains
forward-looking statements regarding CMC's expectations relating to
cash generated by strategic initiatives, economic conditions, U.S.
construction activity, rebar imports and their effects on pricing
and U.S. government action to provide trade relief. These
forward-looking statements generally can be identified by phrases
such as we, CMC or its management, "expects," "anticipates,"
"believes," "estimates," "intends," "plans to," "ought," "could,"
"will," "should," "likely," "appears" or other similar words or
phrases. There are inherent risks and uncertainties in any
forward-looking statements. Although we believe that our
expectations are reasonable, we can give no assurance that these
expectations will prove to have been correct, and actual results
may vary materially. Except as required by law, CMC
undertakes no obligation to update, amend or clarify any
forward-looking statements to reflect changed assumptions, the
occurrence of anticipated or unanticipated events, new information
or circumstances or otherwise.
Factors that could cause actual results to differ materially
from CMC's expectations include the following: overall global
economic conditions, including the ongoing recovery from the last
recession, continued sovereign debt problems in the Euro-zone and
construction activity or lack thereof, and their impact in a highly
cyclical industry; rapid and significant changes in the price of
metals, potentially impairing our inventory values due to declines
in commodity prices; excess capacity in our industry, particularly
in China, and product availability
from competing steel mills and other steel suppliers including
import quantities and pricing; compliance with and changes in
environmental laws and regulations, including increased regulation
associated with climate change and greenhouse gas emissions;
potential limitations in our or our customers' ability to access
credit and non-compliance by our customers with our contracts;
financial covenants and restrictions on the operation of our
business contained in agreements governing our debt; currency
fluctuations; global factors, including political uncertainties and
military conflicts; availability of electricity and natural gas for
mill operations; information technology interruptions and breaches
in security data; ability to hire and retain key executives and
other employees; our ability to make necessary capital
expenditures; our ability to realize the anticipated benefits of
our investment in our new micro mill in Durant, Oklahoma; availability and pricing of
raw materials over which we exert little influence, including scrap
metal, energy, insurance and supply prices; unexpected equipment
failures; competition from other materials or from competitors that
have a lower cost structure or access to greater financial
resources; losses or limited potential gains due to hedging
transactions; litigation claims and settlements, court decisions,
regulatory rulings and legal compliance risks; risk of injury or
death to employees, customers or other visitors to our operations;
and increased costs related to health care reform legislation.
COMMERCIAL METALS
COMPANY
OPERATING
STATISTICS (UNAUDITED)
|
|
|
Three Months
Ended
|
|
Fiscal Year
Ended
|
|
Three Months
Ended
|
(short tons in
thousands)
|
|
8/31/2017
|
|
8/31/2016
|
|
8/31/2017
|
|
8/31/2016
|
|
5/31/2017
|
|
2/28/2017
|
|
11/30/2016
|
Americas
Recycling
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ferrous tons
shipped
|
|
583
|
|
|
423
|
|
|
1,999
|
|
|
1,614
|
|
|
590
|
|
|
421
|
|
|
405
|
|
Non-ferrous tons
shipped
|
|
70
|
|
|
52
|
|
|
233
|
|
|
201
|
|
|
61
|
|
|
53
|
|
|
49
|
|
Americas Recycling
tons shipped
|
|
653
|
|
|
475
|
|
|
2,232
|
|
|
1,815
|
|
|
651
|
|
|
474
|
|
|
454
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas Steel
Mills
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rebar
shipments
|
|
448
|
|
411
|
|
1,703
|
|
|
1,631
|
|
|
445
|
|
|
406
|
|
|
404
|
|
Merchant and other
shipments
|
|
262
|
|
247
|
|
1,022
|
|
|
999
|
|
|
277
|
|
|
252
|
|
|
231
|
|
Total Americas Steel
Mills tons shipped
|
|
710
|
|
658
|
|
2,725
|
|
|
2,630
|
|
|
722
|
|
|
658
|
|
|
635
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average FOB selling
price (total sales)
|
|
$
|
537
|
|
|
$
|
531
|
|
|
$
|
526
|
|
|
$
|
524
|
|
|
$
|
540
|
|
|
$
|
524
|
|
|
$
|
499
|
|
Average cost ferrous
scrap utilized
|
|
$
|
257
|
|
|
$
|
234
|
|
|
$
|
243
|
|
|
$
|
207
|
|
|
$
|
266
|
|
|
$
|
245
|
|
|
$
|
201
|
|
Americas Steel Mills
metal margin
|
|
$
|
280
|
|
|
$
|
297
|
|
|
$
|
283
|
|
|
$
|
317
|
|
|
$
|
274
|
|
|
$
|
279
|
|
|
$
|
298
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International
Mill
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tons
shipped
|
|
396
|
|
|
341
|
|
|
1,379
|
|
|
1,254
|
|
|
354
|
|
|
313
|
|
|
316
|
|
Average FOB selling
price (total sales)
|
|
$
|
476
|
|
|
$
|
409
|
|
|
$
|
432
|
|
|
$
|
391
|
|
|
$
|
443
|
|
|
$
|
402
|
|
|
$
|
397
|
|
Average cost ferrous
scrap utilized
|
|
$
|
269
|
|
|
$
|
211
|
|
|
$
|
240
|
|
|
$
|
195
|
|
|
$
|
253
|
|
|
$
|
229
|
|
|
$
|
202
|
|
International Mill
metal margin
|
|
$
|
207
|
|
|
$
|
198
|
|
|
$
|
192
|
|
|
$
|
196
|
|
|
$
|
190
|
|
|
$
|
173
|
|
|
$
|
195
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas
Fabrication
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rebar
shipments
|
|
260
|
|
|
284
|
|
|
1,009
|
|
|
1,028
|
|
|
275
|
|
|
226
|
|
|
248
|
|
Structural and post
shipments
|
|
26
|
|
|
30
|
|
|
113
|
|
|
127
|
|
|
35
|
|
|
27
|
|
|
25
|
|
Total Americas
Fabrication tons shipped
|
|
286
|
|
|
314
|
|
|
1,122
|
|
|
1,155
|
|
|
310
|
|
|
253
|
|
|
273
|
|
Americas Fabrication
average selling price (excluding stock and buyout sales)
|
|
$
|
773
|
|
|
$
|
805
|
|
|
$
|
772
|
|
|
$
|
841
|
|
|
$
|
775
|
|
|
$
|
756
|
|
|
$
|
782
|
|
COMMERCIAL METALS
COMPANY
BUSINESS SEGMENTS
(UNAUDITED)
|
(in
thousands)
|
|
Three Months
Ended
|
|
Year
Ended
|
|
Three Months
Ended
|
Net
sales
|
|
8/31/2017
|
|
8/31/2016
|
|
8/31/2017
|
|
8/31/2016
|
|
5/31/2017
|
|
2/28/2017
|
|
11/30/2016
|
Americas
Recycling
|
|
$
|
317,298
|
|
|
$
|
195,724
|
|
|
$
|
1,011,500
|
|
|
$
|
705,754
|
|
|
$
|
294,166
|
|
|
$
|
223,328
|
|
|
$
|
176,708
|
|
Americas
Mills
|
|
414,420
|
|
|
381,406
|
|
|
1,565,454
|
|
|
1,498,848
|
|
|
427,276
|
|
|
376,593
|
|
|
347,165
|
|
Americas
Fabrication
|
|
353,726
|
|
|
385,917
|
|
|
1,375,928
|
|
|
1,489,455
|
|
|
379,976
|
|
|
303,826
|
|
|
338,400
|
|
International
Mill
|
|
200,227
|
|
|
147,842
|
|
|
636,562
|
|
|
517,186
|
|
|
167,629
|
|
|
134,305
|
|
|
134,401
|
|
International
Marketing and Distribution
|
|
185,337
|
|
|
203,773
|
|
|
781,364
|
|
|
754,958
|
|
|
223,134
|
|
|
206,056
|
|
|
166,837
|
|
Corporate
|
|
2,124
|
|
|
2,973
|
|
|
9,625
|
|
|
7,082
|
|
|
1,909
|
|
|
3,842
|
|
|
1,750
|
|
Eliminations
|
|
(212,151)
|
|
|
(214,989)
|
|
|
(810,758)
|
|
|
(795,765)
|
|
|
(233,391)
|
|
|
(194,046)
|
|
|
(171,170)
|
|
Total net
sales
|
|
$
|
1,260,981
|
|
|
$
|
1,102,646
|
|
|
$
|
4,569,675
|
|
|
$
|
4,177,518
|
|
|
$
|
1,260,699
|
|
|
$
|
1,053,904
|
|
|
$
|
994,091
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted operating
profit (loss) from continuing operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas
Recycling
|
|
$
|
2,868
|
|
|
$
|
(45,113)
|
|
|
$
|
14,822
|
|
|
$
|
(61,284)
|
|
|
$
|
9,286
|
|
|
$
|
7,766
|
|
|
$
|
(5,098)
|
|
Americas
Mills
|
|
29,803
|
|
|
45,012
|
|
|
168,805
|
|
|
209,751
|
|
|
50,734
|
|
|
51,319
|
|
|
36,949
|
|
Americas
Fabrication
|
|
(4,928)
|
|
|
9,638
|
|
|
4,097
|
|
|
68,602
|
|
|
1,808
|
|
|
506
|
|
|
6,711
|
|
International
Mill
|
|
14,621
|
|
|
18,703
|
|
|
46,977
|
|
|
28,892
|
|
|
12,953
|
|
|
9,430
|
|
|
9,973
|
|
International
Marketing and Distribution
|
|
(26,640)
|
|
|
(6,123)
|
|
|
(24,324)
|
|
|
(23,690)
|
|
|
5,723
|
|
|
351
|
|
|
(3,758)
|
|
Corporate
|
|
(52,419)
|
|
|
(25,670)
|
|
|
(119,629)
|
|
|
(95,085)
|
|
|
(20,880)
|
|
|
(22,317)
|
|
|
(24,013)
|
|
Eliminations
|
|
(822)
|
|
|
3,086
|
|
|
(834)
|
|
|
5,333
|
|
|
771
|
|
|
(574)
|
|
|
(209)
|
|
Adjusted operating
profit (loss) from continuing operations
|
|
$
|
(37,517)
|
|
|
$
|
(467)
|
|
|
$
|
89,914
|
|
|
$
|
132,519
|
|
|
$
|
60,395
|
|
|
$
|
46,481
|
|
|
$
|
20,555
|
|
COMMERCIAL METALS
COMPANY
CONDENSED
CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED)
|
|
Three Months
Ended
|
|
Fiscal Year
Ended
|
(in thousands,
except share data)
|
8/31/2017
|
|
8/31/2016
|
|
8/31/2017
|
|
8/31/2016
|
Net sales
|
$
|
1,260,981
|
|
|
$
|
1,102,646
|
|
|
$
|
4,569,675
|
|
|
$
|
4,177,518
|
|
Costs and
expenses:
|
|
|
|
|
|
|
|
Cost of goods
sold
|
1,149,396
|
|
|
944,242
|
|
|
4,023,265
|
|
|
3,580,618
|
|
Selling, general and
administrative expenses
|
119,021
|
|
|
119,408
|
|
|
426,523
|
|
|
414,561
|
|
Loss on debt
extinguishment
|
22,672
|
|
|
—
|
|
|
22,672
|
|
|
11,480
|
|
Impairment of
assets
|
7,615
|
|
|
39,952
|
|
|
8,164
|
|
|
40,028
|
|
Interest
expense
|
5,939
|
|
|
12,563
|
|
|
44,047
|
|
|
62,121
|
|
|
1,304,643
|
|
|
1,116,165
|
|
|
4,524,671
|
|
|
4,108,808
|
|
Earnings (loss)
from continuing operations before income taxes
|
(43,662)
|
|
|
(13,519)
|
|
|
45,004
|
|
|
68,710
|
|
Income taxes
(benefit)
|
(10,989)
|
|
|
(11,447)
|
|
|
12,454
|
|
|
10,810
|
|
Earnings
(loss) from continuing operations
|
(32,673)
|
|
|
(2,072)
|
|
|
32,550
|
|
|
57,900
|
|
|
|
|
|
|
|
|
|
Earnings
(loss) from discontinued operations before income
taxes
|
(1,890)
|
|
|
1,458
|
|
|
10,607
|
|
|
(1,469)
|
|
Income taxes
(benefit)
|
(5,023)
|
|
|
(483)
|
|
|
(3,175)
|
|
|
1,669
|
|
Earnings (loss) from
discontinued operations
|
3,133
|
|
|
1,941
|
|
|
13,782
|
|
|
(3,138)
|
|
|
|
|
|
|
|
|
|
Net earnings
(loss)
|
(29,540)
|
|
|
(131)
|
|
|
46,332
|
|
|
54,762
|
|
|
|
|
|
|
|
|
|
Basic earnings (loss)
per share:
|
|
|
|
|
|
|
|
Earnings
(loss) from continuing operations
|
$
|
(0.28)
|
|
|
$
|
(0.02)
|
|
|
$
|
0.28
|
|
|
$
|
0.50
|
|
Earnings (loss) from
discontinued operations
|
0.03
|
|
|
0.02
|
|
|
0.12
|
|
|
(0.02)
|
|
Net earnings
(loss)
|
$
|
(0.25)
|
|
|
$
|
—
|
|
|
$
|
0.40
|
|
|
$
|
0.48
|
|
|
|
|
|
|
|
|
|
Diluted earnings
(loss) per share:
|
|
|
|
|
|
|
|
Earnings (loss) from
continuing operations
|
$
|
(0.28)
|
|
|
$
|
(0.02)
|
|
|
$
|
0.27
|
|
|
$
|
0.50
|
|
Earnings (loss) from
discontinued operations
|
0.03
|
|
|
0.02
|
|
|
0.12
|
|
|
(0.03)
|
|
Net earnings
(loss)
|
$
|
(0.25)
|
|
|
$
|
—
|
|
|
$
|
0.39
|
|
|
$
|
0.47
|
|
|
|
|
|
|
|
|
|
Cash dividends per
share
|
$
|
0.12
|
|
|
$
|
0.12
|
|
|
$
|
0.48
|
|
|
$
|
0.48
|
|
Average basic shares
outstanding
|
115,892,403
|
|
|
114,728,278
|
|
|
115,654,466
|
|
|
115,211,490
|
|
Average diluted
shares outstanding
|
115,892,403
|
|
|
114,728,278
|
|
|
117,364,408
|
|
|
116,623,826
|
|
COMMERCIAL METALS
COMPANY
CONDENSED
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
|
(in
thousands)
|
August 31,
2017
|
|
August 31,
2016
|
Assets
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
|
252,595
|
|
|
$
|
517,544
|
|
Accounts receivable,
net
|
706,595
|
|
|
689,382
|
|
Inventories
|
614,459
|
|
|
540,014
|
|
Other current
assets
|
140,251
|
|
|
110,464
|
|
Current assets of
businesses held for sale
|
—
|
|
|
190,721
|
|
Total current
assets
|
1,713,900
|
|
|
2,048,125
|
|
Net property, plant
and equipment
|
1,061,283
|
|
|
895,045
|
|
Goodwill
|
64,915
|
|
|
66,373
|
|
Other
assets
|
135,033
|
|
|
121,326
|
|
Total
assets
|
$
|
2,975,131
|
|
|
$
|
3,130,869
|
|
Liabilities and
stockholders' equity
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts
payable
|
$
|
282,127
|
|
|
$
|
207,875
|
|
Accrued expenses and
other payables
|
307,129
|
|
|
263,086
|
|
Current maturities of
long-term debt
|
19,182
|
|
|
313,469
|
|
Current liabilities
of businesses held for sale
|
—
|
|
|
36,688
|
|
Total current
liabilities
|
608,438
|
|
|
821,118
|
|
Deferred income
taxes
|
49,197
|
|
|
63,021
|
|
Other long-term
liabilities
|
110,986
|
|
|
121,351
|
|
Long-term
debt
|
805,580
|
|
|
757,948
|
|
Total
liabilities
|
1,574,201
|
|
|
1,763,438
|
|
Stockholders'
equity
|
1,400,757
|
|
|
1,367,272
|
|
Stockholders' equity
attributable to noncontrolling interests
|
173
|
|
|
159
|
|
Total
equity
|
1,400,930
|
|
|
1,367,431
|
|
Total liabilities and
stockholders' equity
|
$
|
2,975,131
|
|
|
$
|
3,130,869
|
|
COMMERCIAL METALS
COMPANY AND SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF CASH FLOWS (UNAUDITED)
|
|
|
Year Ended August
31,
|
(in
thousands)
|
|
2017
|
|
2016
|
Cash flows from (used
by) operating activities:
|
|
|
|
|
Net
earnings
|
|
$
|
46,332
|
|
|
$
|
54,762
|
|
Adjustments to
reconcile net earnings to cash flows from (used by) operating
activities:
|
|
|
|
|
Depreciation and
amortization
|
|
125,071
|
|
|
126,940
|
|
Share-based
compensation
|
|
30,311
|
|
|
26,335
|
|
Loss on debt
extinguishment
|
|
22,672
|
|
|
11,480
|
|
Write-down of
inventory
|
|
21,529
|
|
|
15,555
|
|
Deferred income
taxes
|
|
(14,184)
|
|
|
(3,889)
|
|
Amortization of
interest rate swaps termination gain
|
|
(11,657)
|
|
|
(7,597)
|
|
Asset
impairments
|
|
8,238
|
|
|
55,793
|
|
Net loss (gain) on
sales of a subsidiary, assets and other
|
|
6,049
|
|
|
(2,591)
|
|
Provision for losses
on receivables, net
|
|
6,049
|
|
|
6,878
|
|
Tax expense from
stock plans
|
|
—
|
|
|
1,697
|
|
Changes in operating
assets and liabilities, net of acquisitions:
|
|
|
|
|
Accounts
receivable
|
|
(78,527)
|
|
|
142,510
|
|
Proceeds (payments)
on sale of accounts receivable programs, net
|
|
81,731
|
|
|
(19,472)
|
|
Inventories
|
|
(98,835)
|
|
|
209,555
|
|
Accounts payable,
accrued expenses and other payables
|
|
93,478
|
|
|
(43,577)
|
|
Other operating
assets and liabilities
|
|
(63,785)
|
|
|
12,486
|
|
Net cash flows from
operating activities
|
|
174,472
|
|
|
586,865
|
|
|
|
|
|
|
Cash flows from (used
by) investing activities:
|
|
|
|
|
Capital
expenditures
|
|
(213,120)
|
|
|
(163,332)
|
|
Proceeds from the
sale of subsidiaries
|
|
163,449
|
|
|
4,349
|
|
Acquisitions
|
|
(56,080)
|
|
|
—
|
|
Increase in
restricted cash, net
|
|
(11,128)
|
|
|
(21,777)
|
|
Proceeds from the
sale of property, plant and equipment
|
|
3,164
|
|
|
5,113
|
|
Net cash flows used
by investing activities
|
|
(113,715)
|
|
|
(175,647)
|
|
|
|
|
|
|
Cash flows from (used
by) financing activities:
|
|
|
|
|
Repayments of
long-term debt
|
|
(711,850)
|
|
|
(211,394)
|
|
Proceeds from
long-term debt transactions
|
|
475,454
|
|
|
—
|
|
Cash
dividends
|
|
(55,514)
|
|
|
(55,342)
|
|
Debt extinguishment
costs
|
|
(22,672)
|
|
|
(11,127)
|
|
Stock issued under
incentive and purchase plans, net of forfeitures
|
|
(5,498)
|
|
|
(6,034)
|
|
Debt issuance
costs
|
|
(4,449)
|
|
|
—
|
|
Increase (decrease)
in documentary letters of credit, net
|
|
22
|
|
|
(41,468)
|
|
Contribution from
noncontrolling interests
|
|
14
|
|
|
29
|
|
Treasury stock
acquired
|
|
—
|
|
|
(30,595)
|
|
Short-term
borrowings, net change
|
|
—
|
|
|
(20,090)
|
|
Tax expense from
stock plans
|
|
—
|
|
|
(1,697)
|
|
Decrease in
restricted cash
|
|
—
|
|
|
1
|
|
Net cash flows used
by financing activities
|
|
(324,493)
|
|
|
(377,717)
|
|
Effect of exchange
rate changes on cash
|
|
(1,213)
|
|
|
(1,280)
|
|
Increase
(decrease) in cash and cash equivalents
|
|
(264,949)
|
|
|
32,221
|
|
Cash and cash
equivalents at beginning of year
|
|
517,544
|
|
|
485,323
|
|
Cash and cash
equivalents at end of year
|
|
$
|
252,595
|
|
|
$
|
517,544
|
|
COMMERCIAL METALS COMPANY
NON-GAAP FINANCIAL
MEASURES (UNAUDITED)
This press release contains financial measures not derived in
accordance with generally accepted accounting principles ("GAAP").
Reconciliations to the most comparable GAAP measures are provided
below.
Adjusted Operating Profit (Loss) from Continuing
Operations is a non-GAAP financial measure. Adjusted operating
profit (loss) from continuing operations is the sum of our earnings
(loss) from continuing operations before interest expense, income
taxes (benefit) and discounts on sales of accounts receivable.
Adjusted operating profit (loss) from continuing operations should
not be considered as an alternative to earnings (loss) from
continuing operations or net earnings (loss), as determined by
GAAP. Management uses adjusted operating profit (loss) from
continuing operations to evaluate the financial performance of CMC.
For added flexibility, we may sell certain trade accounts
receivable both in the U.S. and internationally. We consider sales
of accounts receivable as an alternative source of liquidity to
finance our operations, and we believe that removing these costs
provides a clearer perspective of CMC's operating performance.
Adjusted operating profit (loss) from continuing operations may be
inconsistent with similar measures presented by other
companies.
|
Three Months
Ended
|
|
Fiscal Year
Ended
|
|
Three Months
Ended
|
(in
thousands)
|
8/31/2017
|
|
8/31/2016
|
|
8/31/2017
|
|
8/31/2016
|
|
5/31/2017
|
|
2/28/2017
|
|
11/30/2016
|
Earnings
(loss) from continuing operations
|
$
|
(32,673)
|
|
|
$
|
(2,072)
|
|
|
$
|
32,550
|
|
|
$
|
57,900
|
|
|
$
|
34,978
|
|
|
$
|
25,310
|
|
|
$
|
4,936
|
|
Interest
expense
|
5,939
|
|
|
12,563
|
|
|
44,047
|
|
|
62,121
|
|
|
12,368
|
|
|
12,447
|
|
|
13,292
|
|
Income taxes
(benefit)
|
(10,989)
|
|
|
(11,447)
|
|
|
12,454
|
|
|
10,810
|
|
|
12,819
|
|
|
8,524
|
|
|
2,100
|
|
Discounts on sales of
accounts receivable
|
206
|
|
|
489
|
|
|
863
|
|
|
1,688
|
|
|
230
|
|
|
200
|
|
|
227
|
|
Adjusted operating
profit (loss) from continuing operations
|
$
|
(37,517)
|
|
|
$
|
(467)
|
|
|
$
|
89,914
|
|
|
$
|
132,519
|
|
|
$
|
60,395
|
|
|
$
|
46,481
|
|
|
$
|
20,555
|
|
Adjusted EBITDA from Continuing Operations is a non-GAAP
financial measure. Adjusted EBITDA from continuing operations is
the sum of earnings (loss) from continuing operations before
interest expense and income taxes (benefit). It also excludes CMC's
largest recurring non-cash charge, depreciation and amortization,
as well as impairment charges, which are also non-cash. Adjusted
EBITDA from continuing operations should not be considered an
alternative to earnings (loss) from continuing operations or net
earnings (loss), or as a better measure of liquidity than net cash
flows from operating activities, as determined by GAAP. However, we
believe that adjusted EBITDA from continuing operations provides
relevant and useful information, which is often used by analysts,
creditors and other interested parties in our industry as it
allows: (i) comparison of our earnings to those of our competitors;
(ii) a supplemental measure of our ongoing core performance; and
(iii) the assessment of period-to-period performance trends.
Additionally, adjusted EBITDA from continuing operations is the
target benchmark for our annual and long-term cash incentive
performance plans for management. Adjusted EBITDA from continuing
operations may be inconsistent with similar measures presented by
other companies.
|
Three Months
Ended
|
|
Fiscal Year
Ended
|
|
Three Months
Ended
|
(in
thousands)
|
8/31/2017
|
|
8/31/2016
|
|
8/31/2017
|
|
8/31/2016
|
|
5/31/2017
|
|
2/28/2017
|
|
11/30/2016
|
Earnings
(loss) from continuing operations
|
$
|
(32,673)
|
|
|
$
|
(2,072)
|
|
|
$
|
32,550
|
|
|
$
|
57,900
|
|
|
$
|
34,978
|
|
|
$
|
25,310
|
|
|
$
|
4,936
|
|
Interest
expense
|
5,939
|
|
|
12,563
|
|
|
44,047
|
|
|
62,121
|
|
|
12,368
|
|
|
12,447
|
|
|
13,292
|
|
Income taxes
(benefit)
|
(10,989)
|
|
|
(11,447)
|
|
|
12,454
|
|
|
10,810
|
|
|
12,819
|
|
|
8,524
|
|
|
2,100
|
|
Depreciation and
amortization
|
32,020
|
|
|
31,512
|
|
|
125,053
|
|
|
126,918
|
|
|
32,256
|
|
|
30,496
|
|
|
30,282
|
|
Impairment
charges
|
7,615
|
|
|
39,953
|
|
|
8,164
|
|
|
40,028
|
|
|
70
|
|
|
91
|
|
|
388
|
|
Adjusted EBITDA from
continuing operations
|
$
|
1,912
|
|
|
$
|
70,509
|
|
|
$
|
222,268
|
|
|
$
|
297,777
|
|
|
$
|
92,491
|
|
|
$
|
76,868
|
|
|
$
|
50,998
|
|
View original
content:http://www.prnewswire.com/news-releases/commercial-metals-company-reports-fourth-quarter-and-full-year-earnings-300543653.html
SOURCE Commercial Metals Company