IRVING, Texas, March 23,
2017 /PRNewswire/ -- Commercial Metals Company (NYSE: CMC) today
announced financial results for its second quarter ended
February 28, 2017. Net earnings for the second quarter of
fiscal 2017 were $30.3 million
($0.26 per diluted share) on net
sales of $1.1 billion. This compares
to net earnings of $10.5 million
($0.09 per diluted share) on net
sales of $1.0 billion for the second
quarter of fiscal 2016. Results for the second quarter of
fiscal 2016 included an after-tax impact of debt extinguishment
costs of $7.4 million ($0.06 per diluted share) associated with the
tender offers for senior notes completed on February 17, 2016. Earnings from continuing
operations were $29.6 million for the
second quarter of fiscal 2017, compared with $10.8 million for the same period of the prior
year.
Adjusted operating profit from continuing operations was
$52.3 million for the second quarter
of fiscal 2017, compared with adjusted operating profit from
continuing operations of $30.0
million for the second quarter of fiscal 2016. Adjusted
EBITDA from continuing operations was $82.7
million for the second quarter of fiscal 2017, compared with
adjusted EBITDA from continuing operations of $61.1 million for the second quarter of fiscal
2016.
The Company's liquidity position at February 28, 2017
remained strong with cash and cash equivalents of $395.5 million and availability under the
Company's credit and accounts receivables sales facilities of
approximately $575 million. The
Company regularly evaluates the use of its cash in efforts to
maximize total shareholder return, including debt repayment,
capital deployment, share repurchases and dividends.
Joe Alvarado, Chairman of the
Board and CEO, commented, "After a slow start in our first fiscal
quarter, customers re-entered the market during the most recent
quarter with a renewed outlook and optimism for growth. This,
combined with mild winter conditions in the United States along with rising selling
prices, resulted in very strong results for our second quarter
which is normally a seasonally slower period. The value of our
vertical integration was evident during the quarter as the impact
of margin compression in our fabrication operations was offset by
sharply rising scrap prices contributing to margin expansion in our
recycling business."
Alvarado continued, "Our recent acquisitions highlight our
commitment to grow our portfolio and extend the vertical
integration and geographic reach of our business. We welcome the
employees from Continental Concrete Structures, Inc., a supplier of
post-tensioning cable and related products, the steel rebar
fabrication business of Associated Steel Workers, Limited (ASW) in
Hawaii, and the seven recycling
facilities in the South East, to CMC."
On March 22, 2017, the board of directors of CMC declared a
quarterly dividend of $0.12 per share
for shareholders of record on April 5, 2017. The
dividend will be paid on April 20, 2017.
Business Segments-Fiscal Second Quarter 2017
Review
Our Americas Recycling segment recorded adjusted
operating profit of $7.8 million for
the second quarter of fiscal 2017 compared to an adjusted operating
loss of $7.6 million for the second
quarter of fiscal 2016. The improvement in adjusted operating
profit compared to the same period in fiscal 2016 was primarily the
result of strong ferrous scrap demand due to increased industry
capacity utilization, sharply rising prices in both ferrous and
nonferrous materials, as well as ongoing cost reduction
measures.
Our Americas Mills segment recorded adjusted operating profit of
$51.3 million for the second quarter
of fiscal 2017 compared to adjusted operating profit of
$50.7 million for the corresponding
period in fiscal 2016. Profitability in this segment remained
relatively flat in comparison to the second quarter of fiscal 2016
due to lower metal margins offset by increased shipments.
Some of the increase in shipments was the result of customers
buying ahead of announced price increases, however, low service
center inventory levels and strength in construction activity in
our markets also contributed to the demand. We believe margins will
continue to be pressured by imports and result in selling price
increases lagging ferrous scrap cost increases in the near
term.
Our Americas Fabrication segment recorded adjusted operating
profit of $0.5 million for the second
quarter of fiscal 2017 compared to adjusted operating profit of
$14.8 million for the second quarter
of fiscal 2016. The decline in adjusted operating profit for the
second quarter of fiscal 2017 continued the effect, seen over the
past few quarters, of aggressive competition resulting in lower
prices for projects booked running through our fabrication
backlog.
Despite the normal winter conditions, our International Mill
segment in Poland recorded
adjusted operating profit of $9.4
million for the second quarter of fiscal 2017 compared to
adjusted operating profit of $2.0
million for the corresponding period in fiscal 2016.
Product mix more heavily weighted to higher margin merchant
products, coupled with demand from the construction sector
continuing to remain robust, resulted in the third successive
quarter of strong results in this segment.
Our International Marketing and Distribution segment recorded
adjusted operating profit of $6.1
million for the second quarter of fiscal 2017 compared to an
adjusted operating loss of $2.3
million for the same period in the prior fiscal year. The
increase in adjusted operating profit was primarily due to improved
margins across the steel and raw material trading businesses
recorded during a period of rising commodity pricing and some
rejuvenated demand in the U.S. oil and gas drilling activities.
Year to Date Results
Net earnings for the six months
ended February 28, 2017 were $36.6
million ($0.31 per diluted
share) on net sales of $2.2 billion,
compared with net earnings of $35.6
million ($0.30 per diluted
share) on net sales of $2.2 billion
for the six months ended February 29, 2016. For the six months
ended February 28, 2017, earnings from continuing operations
were $36.8 million compared with
$36.5 million for the same period of
the prior year. For the six months ended February 28,
2017, adjusted operating profit from continuing operations was
$75.6 million, compared with
$86.0 million for the six months
ended February 29, 2016. Adjusted EBITDA from continuing
operations was $136.5 million for the
six months ended February 28, 2017, compared with $148.8 million for the six months ended
February 29, 2016.
Outlook
Alvarado concluded, "We anticipate demand will
remain robust, supported by strong levels of bidding in our
fabrication business, growth oriented leading indicators such as
the Architectural Billings Index and overall consumer confidence
across all of our product lines. We anticipate that our
shipment levels will continue to grow in our third quarter as we
enter the traditionally strong construction season in both the U.S.
and Polish markets. However, we anticipate further pressure on our
margins as imports continue to make it difficult to increase
selling prices for our products in line with scrap cost
increases."
"In spite of a mixed reaction to the preliminary countervailing
and anti-dumping duties recently announced by the U.S. Department
of Commerce, we are pleased that there has finally been some
recognition that producers in Japan, Taiwan
and Turkey are trading rebar
products unfairly. The final results for these duties will be
released in the coming months, and we will continue to work for the
enforcement of our trade laws."
"We are also hopeful that the policies of the new administration
in the U.S. will support economic growth through tax reform, a
reduced regulatory environment, the introduction of an
infrastructure regeneration program and more rigorous enforcement
of trade actions. We believe we are well-positioned to
capitalize on the benefits from these initiatives, however, it is
unknown when and how these policies will be implemented."
Conference Call
CMC invites you to listen to a live
broadcast of its second quarter of fiscal 2017 conference call
today, Thursday, March 23, 2017, at 11:00 a.m. ET. Joe
Alvarado, Chairman of the Board and CEO, Barbara Smith, President and COO, and
Mary Lindsey, 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."
About Commercial Metals Company
Commercial Metals
Company and its subsidiaries manufacture, recycle and market steel
and metal products, related materials and services through a
network including steel minimills, 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
demand, shipment levels, economic conditions, changes in political
and regulatory conditions, including duties announced by the U.S.
Department of Commerce and the effects thereof, the effects of
global steel overcapacity and international trade, anticipated
finished goods pricing and customer growth, and CMC's
margins. 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,"
"potential," "outlook," 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 data security; ability to hire and retain key executives and
other employees; our ability to make necessary capital
expenditures; 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
|
|
Six Months
Ended
|
|
Three Months
Ended
|
(short tons in
thousands)
|
|
2/28/2017
|
|
2/29/2016
|
|
2/28/2017
|
|
2/29/2016
|
|
11/30/2016
|
|
8/31/2016
|
|
5/31/2016
|
Americas
Recycling
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ferrous tons shipped
|
|
421
|
|
|
379
|
|
|
826
|
|
|
768
|
|
|
405
|
|
|
423
|
|
|
423
|
|
Nonferrous tons shipped
|
|
53
|
|
|
48
|
|
|
102
|
|
|
100
|
|
|
49
|
|
|
52
|
|
|
49
|
|
Americas Recycling
tons shipped
|
|
474
|
|
|
427
|
|
|
928
|
|
|
868
|
|
|
454
|
|
|
475
|
|
|
472
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas Steel
Mills
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rebar shipments
|
|
406
|
|
|
364
|
|
|
810
|
|
|
758
|
|
|
404
|
|
|
411
|
|
|
462
|
|
Merchant and other shipments
|
|
252
|
|
|
244
|
|
|
483
|
|
|
490
|
|
|
231
|
|
|
247
|
|
|
262
|
|
Americas Steel Mills
tons shipped
|
|
658
|
|
|
608
|
|
|
1,293
|
|
|
1,248
|
|
|
635
|
|
|
658
|
|
|
724
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average selling price (total sales)
|
|
$
|
524
|
|
|
$
|
510
|
|
|
$
|
511
|
|
|
$
|
533
|
|
|
$
|
499
|
|
|
$
|
531
|
|
|
$
|
501
|
|
Average cost ferrous scrap utilized
|
|
245
|
|
|
179
|
|
|
223
|
|
|
188
|
|
|
201
|
|
|
234
|
|
|
213
|
|
Americas Steel Mills
metal margin
|
|
$
|
279
|
|
|
$
|
331
|
|
|
$
|
288
|
|
|
$
|
345
|
|
|
$
|
298
|
|
|
$
|
297
|
|
|
$
|
288
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International
Mill
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tons shipped
|
|
313
|
|
|
282
|
|
|
629
|
|
|
560
|
|
|
316
|
|
|
341
|
|
|
353
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average selling price (total sales)
|
|
$
|
402
|
|
|
$
|
363
|
|
|
$
|
399
|
|
|
$
|
385
|
|
|
$
|
397
|
|
|
$
|
409
|
|
|
$
|
378
|
|
Average cost ferrous scrap utilized
|
|
229
|
|
|
178
|
|
|
215
|
|
|
192
|
|
|
202
|
|
|
211
|
|
|
187
|
|
International Mill
metal margin
|
|
$
|
173
|
|
|
$
|
185
|
|
|
$
|
184
|
|
|
$
|
193
|
|
|
$
|
195
|
|
|
$
|
198
|
|
|
$
|
191
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas
Fabrication
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rebar shipments
|
|
226
|
|
|
225
|
|
|
474
|
|
|
474
|
|
|
248
|
|
|
284
|
|
|
270
|
|
Structural and post shipments
|
|
27
|
|
|
29
|
|
|
52
|
|
|
57
|
|
|
25
|
|
|
30
|
|
|
40
|
|
Americas Fabrication
tons shipped
|
|
253
|
|
|
254
|
|
|
526
|
|
|
531
|
|
|
273
|
|
|
314
|
|
|
310
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas Fabrication
average selling price (excluding stock and buyout sales)
|
|
$
|
756
|
|
|
$
|
842
|
|
|
$
|
769
|
|
|
$
|
866
|
|
|
$
|
782
|
|
|
$
|
805
|
|
|
$
|
827
|
|
COMMERCIAL METALS
COMPANY
BUSINESS SEGMENTS
(UNAUDITED)
|
(in
thousands)
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
Three Months
Ended
|
Net
sales
|
|
2/28/2017
|
|
2/29/2016
|
|
2/28/2017
|
|
2/29/2016
|
|
11/30/2016
|
|
8/31/2016
|
|
5/31/2016
|
Americas
Recycling
|
|
$
|
223,328
|
|
|
$
|
148,346
|
|
|
$
|
400,036
|
|
|
$
|
327,553
|
|
|
$
|
176,708
|
|
|
$
|
195,724
|
|
|
$
|
182,477
|
|
Americas
Mills
|
|
376,593
|
|
|
336,429
|
|
|
723,758
|
|
|
720,961
|
|
|
347,165
|
|
|
381,406
|
|
|
396,481
|
|
Americas
Fabrication
|
|
303,826
|
|
|
336,144
|
|
|
642,226
|
|
|
718,458
|
|
|
338,400
|
|
|
385,917
|
|
|
385,080
|
|
International
Mill
|
|
134,305
|
|
|
107,458
|
|
|
268,706
|
|
|
227,906
|
|
|
134,401
|
|
|
147,842
|
|
|
141,438
|
|
International
Marketing and Distribution
|
|
302,295
|
|
|
276,876
|
|
|
550,455
|
|
|
559,913
|
|
|
248,160
|
|
|
310,079
|
|
|
319,604
|
|
Corporate
|
|
3,842
|
|
|
(2,867)
|
|
|
5,592
|
|
|
(476)
|
|
|
1,750
|
|
|
2,973
|
|
|
4,585
|
|
Eliminations
|
|
(194,568)
|
|
|
(182,689)
|
|
|
(366,089)
|
|
|
(379,759)
|
|
|
(171,521)
|
|
|
(215,361)
|
|
|
(202,275)
|
|
Total net
sales
|
|
$
|
1,149,621
|
|
|
$
|
1,019,697
|
|
|
$
|
2,224,684
|
|
|
$
|
2,174,556
|
|
|
$
|
1,075,063
|
|
|
$
|
1,208,580
|
|
|
$
|
1,227,390
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted operating
profit (loss) from continuing operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas
Recycling
|
|
$
|
7,766
|
|
|
$
|
(7,645)
|
|
|
$
|
2,668
|
|
|
$
|
(14,193)
|
|
|
$
|
(5,098)
|
|
|
$
|
(45,113)
|
|
|
$
|
(1,978)
|
|
Americas
Mills
|
|
51,319
|
|
|
50,699
|
|
|
88,268
|
|
|
109,763
|
|
|
36,949
|
|
|
45,012
|
|
|
54,976
|
|
Americas
Fabrication
|
|
506
|
|
|
14,825
|
|
|
7,217
|
|
|
36,170
|
|
|
6,711
|
|
|
9,638
|
|
|
22,794
|
|
International
Mill
|
|
9,430
|
|
|
1,951
|
|
|
19,403
|
|
|
4,722
|
|
|
9,973
|
|
|
18,703
|
|
|
5,467
|
|
International
Marketing and Distribution
|
|
6,143
|
|
|
(2,293)
|
|
|
5,177
|
|
|
(4,462)
|
|
|
(966)
|
|
|
(3,517)
|
|
|
892
|
|
Corporate
|
|
(22,317)
|
|
|
(28,801)
|
|
|
(46,330)
|
|
|
(46,873)
|
|
|
(24,013)
|
|
|
(25,670)
|
|
|
(22,542)
|
|
Eliminations
|
|
(576)
|
|
|
1,232
|
|
|
(780)
|
|
|
902
|
|
|
(204)
|
|
|
3,086
|
|
|
1,331
|
|
Adjusted operating
profit from continuing operations
|
|
$
|
52,271
|
|
|
$
|
29,968
|
|
|
$
|
75,623
|
|
|
$
|
86,029
|
|
|
$
|
23,352
|
|
|
$
|
2,139
|
|
|
$
|
60,940
|
|
COMMERCIAL METALS
COMPANY
CONDENSED
CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED)
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
(in thousands,
except share data)
|
|
February 28,
2017
|
|
February 29,
2016
|
|
February 28,
2017
|
|
February 29,
2016
|
Net sales
|
|
$
|
1,149,621
|
|
|
$
|
1,019,697
|
|
|
$
|
2,224,684
|
|
|
$
|
2,174,556
|
|
Costs and
expenses:
|
|
|
|
|
|
|
|
|
Cost of goods
sold
|
|
990,431
|
|
|
884,876
|
|
|
1,933,502
|
|
|
1,882,118
|
|
Selling, general and
administrative expenses
|
|
107,119
|
|
|
93,918
|
|
|
215,986
|
|
|
195,826
|
|
Interest
expense
|
|
12,442
|
|
|
16,625
|
|
|
25,740
|
|
|
34,929
|
|
Loss on debt
extinguishment
|
|
â
|
|
|
11,365
|
|
|
â
|
|
|
11,365
|
|
|
|
1,109,992
|
|
|
1,006,784
|
|
|
2,175,228
|
|
|
2,124,238
|
|
|
|
|
|
|
|
|
|
|
Earnings from
continuing operations before income taxes
|
|
39,629
|
|
|
12,913
|
|
|
49,456
|
|
|
50,318
|
|
Income
taxes
|
|
9,990
|
|
|
2,064
|
|
|
12,643
|
|
|
13,836
|
|
Earnings from
continuing operations
|
|
29,639
|
|
|
10,849
|
|
|
36,813
|
|
|
36,482
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) from
discontinued operations before income taxes (benefit)
|
|
726
|
|
|
(446)
|
|
|
(191)
|
|
|
(1,018)
|
|
Income taxes
(benefit)
|
|
33
|
|
|
(99)
|
|
|
15
|
|
|
(101)
|
|
Earnings (loss) from
discontinued operations
|
|
693
|
|
|
(347)
|
|
|
(206)
|
|
|
(917)
|
|
|
|
|
|
|
|
|
|
|
Net
earnings
|
|
30,332
|
|
|
10,502
|
|
|
36,607
|
|
|
35,565
|
|
Less net earnings
attributable to noncontrolling interests
|
|
â
|
|
|
â
|
|
|
â
|
|
|
â
|
|
Net earnings
attributable to CMC
|
|
30,332
|
|
|
10,502
|
|
|
36,607
|
|
|
35,565
|
|
|
|
|
|
|
|
|
|
|
Basic earnings (loss)
per share attributable to CMC:
|
|
|
|
|
|
|
|
|
Earnings from
continuing operations
|
|
$
|
0.25
|
|
|
$
|
0.09
|
|
|
$
|
0.32
|
|
|
$
|
0.32
|
|
Earnings (loss) from
discontinued operations
|
|
0.01
|
|
|
â
|
|
|
â
|
|
|
(0.01)
|
|
Net
earnings
|
|
$
|
0.26
|
|
|
$
|
0.09
|
|
|
$
|
0.32
|
|
|
$
|
0.31
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings
(loss) per share attributable to CMC:
|
|
|
|
|
|
|
|
|
Earnings from
continuing operations
|
|
$
|
0.25
|
|
|
$
|
0.09
|
|
|
$
|
0.31
|
|
|
$
|
0.31
|
|
Earnings (loss) from
discontinued operations
|
|
0.01
|
|
|
â
|
|
|
â
|
|
|
(0.01)
|
|
Net
earnings
|
|
$
|
0.26
|
|
|
$
|
0.09
|
|
|
$
|
0.31
|
|
|
$
|
0.30
|
|
|
|
|
|
|
|
|
|
|
Cash dividends per
share
|
|
$
|
0.12
|
|
|
$
|
0.12
|
|
|
$
|
0.24
|
|
|
$
|
0.24
|
|
Average basic shares
outstanding
|
|
115,736,369
|
|
|
115,429,550
|
|
|
115,415,662
|
|
|
115,725,896
|
|
Average diluted
shares outstanding
|
|
117,120,208
|
|
|
116,507,591
|
|
|
117,007,958
|
|
|
117,002,822
|
|
COMMERCIAL METALS
COMPANY
CONDENSED
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
|
(in
thousands)
|
|
February 28,
2017
|
|
August 31,
2016
|
Assets
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
395,546
|
|
|
$
|
517,544
|
|
Accounts receivable,
net
|
|
774,286
|
|
|
765,784
|
|
Inventories,
net
|
|
720,786
|
|
|
652,754
|
|
Other current
assets
|
|
96,422
|
|
|
112,043
|
|
Total current
assets
|
|
1,987,040
|
|
|
2,048,125
|
|
Net property, plant
and equipment
|
|
940,344
|
|
|
895,049
|
|
Goodwill
|
|
66,530
|
|
|
66,373
|
|
Other
assets
|
|
137,919
|
|
|
121,322
|
|
Total
assets
|
|
$
|
3,131,833
|
|
|
$
|
3,130,869
|
|
Liabilities and
stockholders' equity
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Accounts
payable-trade
|
|
$
|
307,488
|
|
|
$
|
243,532
|
|
Accounts
payable-documentary letters of credit
|
|
â
|
|
|
5
|
|
Accrued expenses and
other payables
|
|
220,433
|
|
|
264,112
|
|
Current maturities of
long-term debt
|
|
312,200
|
|
|
313,469
|
|
Total current
liabilities
|
|
840,121
|
|
|
821,118
|
|
Deferred income
taxes
|
|
55,625
|
|
|
63,021
|
|
Other long-term
liabilities
|
|
121,930
|
|
|
121,351
|
|
Long-term
debt
|
|
752,137
|
|
|
757,948
|
|
Total
liabilities
|
|
1,769,813
|
|
|
1,763,438
|
|
Stockholders' equity
attributable to CMC
|
|
1,361,848
|
|
|
1,367,272
|
|
Stockholders' equity
attributable to noncontrolling interests
|
|
172
|
|
|
159
|
|
Total
equity
|
|
1,362,020
|
|
|
1,367,431
|
|
Total liabilities and
stockholders' equity
|
|
$
|
3,131,833
|
|
|
$
|
3,130,869
|
|
COMMERCIAL METALS
COMPANY AND SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
|
|
|
Six Months
Ended
|
(in
thousands)
|
|
February 28,
2017
|
|
February 29,
2016
|
Cash flows from (used
by) operating activities:
|
|
|
|
|
Net
earnings
|
|
$
|
36,607
|
|
|
$
|
35,565
|
|
Adjustments to
reconcile net earnings to cash flows from (used by) operating
activities:
|
|
|
|
|
Depreciation and
amortization
|
|
60,789
|
|
|
63,541
|
|
Stock-based
compensation
|
|
16,156
|
|
|
13,106
|
|
Deferred income
taxes
|
|
(9,380)
|
|
|
(4,614)
|
|
Amortization of
interest rate swaps termination gain
|
|
(3,798)
|
|
|
(3,798)
|
|
Provision for losses
on receivables, net
|
|
1,381
|
|
|
2,740
|
|
Write-down of
inventories
|
|
1,205
|
|
|
7,949
|
|
Asset
impairment
|
|
553
|
|
|
â
|
|
Net gain on sales of
assets and other
|
|
(195)
|
|
|
(2,767)
|
|
Loss on debt
extinguishment
|
|
â
|
|
|
11,365
|
|
Tax benefit from
stock plans
|
|
â
|
|
|
(55)
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
Accounts
receivable
|
|
2,162
|
|
|
190,622
|
|
Proceeds (payments)
on sales of accounts receivable programs, net
|
|
(5,102)
|
|
|
11,504
|
|
Inventories
|
|
(68,456)
|
|
|
111,544
|
|
Accounts payable,
accrued expenses and other payables
|
|
9,374
|
|
|
(115,002)
|
|
Changes in other
operating assets and liabilities
|
|
(29,313)
|
|
|
11,110
|
|
Net cash flows from
operating activities
|
|
11,983
|
|
|
332,810
|
|
Cash flows from (used
by) investing activities:
|
|
|
|
|
Capital
expenditures
|
|
(90,808)
|
|
|
(62,437)
|
|
Acquisitions, net of
cash acquired
|
|
(25,366)
|
|
|
â
|
|
Decrease (increase)
in restricted cash
|
|
21,033
|
|
|
(49,145)
|
|
Proceeds from the
sale of property, plant and equipment and other
|
|
700
|
|
|
3,060
|
|
Proceeds from the
sale of subsidiaries
|
|
524
|
|
|
â
|
|
Net cash flows used
by investing activities
|
|
(93,917)
|
|
|
(108,522)
|
|
Cash flows from (used
by) financing activities:
|
|
|
|
|
Cash
dividends
|
|
(27,726)
|
|
|
(27,839)
|
|
Repayments on
long-term debt
|
|
(6,148)
|
|
|
(205,816)
|
|
Stock issued under
incentive and purchase plans, net of forfeitures
|
|
(5,408)
|
|
|
(5,671)
|
|
Contribution from
noncontrolling interests
|
|
13
|
|
|
29
|
|
Increase (decrease)
in documentary letters of credit, net
|
|
(5)
|
|
|
(25,815)
|
|
Short-term
borrowings, net change
|
|
â
|
|
|
(20,090)
|
|
Treasury stock
acquired
|
|
â
|
|
|
(30,595)
|
|
Debt extinguishment
costs
|
|
â
|
|
|
(11,013)
|
|
Tax benefit from
stock plans
|
|
â
|
|
|
55
|
|
Decrease in
restricted cash
|
|
â
|
|
|
1
|
|
Net cash flows used
by financing activities
|
|
(39,274)
|
|
|
(326,754)
|
|
Effect of exchange
rate changes on cash
|
|
(790)
|
|
|
(1,179)
|
|
Increase (decrease)
in cash and cash equivalents
|
|
(121,998)
|
|
|
(103,645)
|
|
Cash and cash
equivalents at beginning of year
|
|
517,544
|
|
|
485,323
|
|
Cash and cash
equivalents at end of period
|
|
$
|
395,546
|
|
|
$
|
381,678
|
|
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 from Continuing Operations is a
non-GAAP financial measure. Adjusted operating profit from
continuing operations is the sum of our earnings from continuing
operations before income taxes, interest expense and discounts on
sales of accounts receivable. Adjusted operating profit from
continuing operations should not be considered as an alternative to
earnings from continuing operations or net earnings, as determined
by GAAP. Management uses adjusted operating profit 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 from continuing operations may be inconsistent
with similar measures presented by other companies.
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
Three Months
Ended
|
(in
thousands)
|
|
2/28/2017
|
|
2/29/2016
|
|
2/28/2017
|
|
2/29/2016
|
|
11/30/2016
|
|
8/31/2016
|
|
5/31/2016
|
Earnings from
continuing operations
|
|
$
|
29,639
|
|
|
$
|
10,849
|
|
|
$
|
36,813
|
|
|
$
|
36,482
|
|
|
$
|
7,174
|
|
|
$
|
950
|
|
|
$
|
35,111
|
|
Income
taxes
|
|
9,990
|
|
|
2,064
|
|
|
12,643
|
|
|
13,836
|
|
|
2,653
|
|
|
(11,865)
|
|
|
10,676
|
|
Interest
expense
|
|
12,442
|
|
|
16,625
|
|
|
25,740
|
|
|
34,929
|
|
|
13,298
|
|
|
12,565
|
|
|
14,737
|
|
Discounts on sales of
accounts receivable
|
|
200
|
|
|
430
|
|
|
427
|
|
|
782
|
|
|
227
|
|
|
489
|
|
|
416
|
|
Adjusted operating
profit from continuing operations
|
|
$
|
52,271
|
|
|
$
|
29,968
|
|
|
$
|
75,623
|
|
|
$
|
86,029
|
|
|
$
|
23,352
|
|
|
$
|
2,139
|
|
|
$
|
60,940
|
|
Adjusted EBITDA from Continuing Operations is a non-GAAP
financial measure. Adjusted EBITDA from continuing operations is
the sum of earnings from continuing operations before net earnings
attributable to noncontrolling interests, interest expense and
income taxes. It also excludes CMC's largest recurring non-cash
charge, depreciation and amortization, as well as long-lived asset
and goodwill impairment charges, which are also non-cash. There
were no net earnings attributable to noncontrolling interests
during the three and six months ended February 28, 2017 and
February 29, 2016. Adjusted EBITDA from continuing operations
should not be considered an alternative to earnings from continuing
operations or net earnings, 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 as it
allows: (i) comparison of our earnings to those of other
competitors; (ii) a better understanding of our ongoing core
performance; and (iii) assessing 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
|
|
Six Months
Ended
|
|
Three Months
Ended
|
(in
thousands)
|
|
2/28/2017
|
|
2/29/2016
|
|
2/28/2017
|
|
2/29/2016
|
|
11/30/2016
|
|
8/31/2016
|
|
5/31/2016
|
Earnings from
continuing operations
|
|
$
|
29,639
|
|
|
$
|
10,849
|
|
|
$
|
36,813
|
|
|
$
|
36,482
|
|
|
$
|
7,174
|
|
|
$
|
950
|
|
|
$
|
35,111
|
|
Interest
expense
|
|
12,442
|
|
|
16,625
|
|
|
25,740
|
|
|
34,929
|
|
|
13,298
|
|
|
12,565
|
|
|
14,737
|
|
Income
taxes
|
|
9,990
|
|
|
2,064
|
|
|
12,643
|
|
|
13,836
|
|
|
2,653
|
|
|
(11,865)
|
|
|
10,676
|
|
Depreciation and
amortization
|
|
30,499
|
|
|
31,550
|
|
|
60,785
|
|
|
63,541
|
|
|
30,286
|
|
|
31,516
|
|
|
31,883
|
|
Impairment
charges
|
|
91
|
|
|
â
|
|
|
479
|
|
|
â
|
|
|
388
|
|
|
39,952
|
|
|
76
|
|
Adjusted EBITDA from
continuing operations
|
|
$
|
82,661
|
|
|
$
|
61,088
|
|
|
$
|
136,460
|
|
|
$
|
148,788
|
|
|
$
|
53,799
|
|
|
$
|
73,118
|
|
|
$
|
92,483
|
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/commercial-metals-company-reports-second-quarter-fiscal-2017-earnings-per-share-of-026-300428231.html
SOURCE Commercial Metals Company