0000022444FALSE00000224442024-06-202024-06-20

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): June 20, 2024
Commercial Metals Company
(Exact Name of Registrant as Specified in Charter)
Delaware
(State or Other Jurisdiction of Incorporation)
1-430475-0725338
(Commission File Number)
(IRS Employer Identification No.)
6565 N. MacArthur Blvd.
Irving, Texas
75039
(Address of Principal Executive Offices)(Zip Code)
(214) 689-4300
(Registrant’s Telephone Number, Including Area Code)

Not Applicable
(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
☐
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of Each ClassTrading Symbol(s)Name of Each Exchange on Which Registered
Common Stock, $0.01 par valueCMCNew York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨


Item 2.02 Results of Operations and Financial Condition.

On June 20, 2024, Commercial Metals Company (the “Company”) issued a press release announcing its financial results for the third quarter of fiscal year 2024. A copy of the press release is attached hereto as Exhibit 99.1. The press release is incorporated by reference into this Item 2.02, and the foregoing description of the press release is qualified in its entirety by reference to Exhibit 99.1.

The information in this Item 2.02 of Form 8-K, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to liabilities under that section and is not incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended (the "Securities Act"), or the Exchange Act, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

Item 7.01 Regulation FD Disclosure.

On June 20, 2024, the Company made available on its website a financial presentation regarding its financial results for the third quarter of fiscal year 2024. A copy of the financial presentation is attached hereto as Exhibit 99.2. The financial presentation is incorporated by reference into this Item 7.01, and the foregoing description of the financial presentation is qualified in its entirety by reference to Exhibit 99.2.

The information in this Item 7.01 of Form 8-K, including Exhibit 99.2, shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to liabilities under that section and is not incorporated by reference into any filing of the Company under the Securities Act or the Exchange Act, whether made before or after the date hereof, regardless of any general incorporation language in such filing.


Item 9.01 Financial Statements and Exhibits.
(d)   Exhibits
The following exhibits are being furnished as part of this Current Report on Form 8-K:
99.1
99.2
104Cover Page Interactive Data File (embedded within the Inline XBRL document)



SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 
COMMERCIAL METALS COMPANY
  
Date: June 20, 2024 By: /s/ Paul J. Lawrence
 Name: Paul J. Lawrence
  Title: Senior Vice President and Chief Financial Officer
 






Exhibit No. 99.1
News Release cmc-logo_rgbxprimaryx300px.jpg


CMC REPORTS THIRD QUARTER FISCAL 2024 RESULTS

•Third quarter net earnings of $119.4 million, or $1.02 per diluted share
•Consolidated core EBITDA of $256.1 million; core EBITDA margin of 12.3%
•Solid seasonal demand and underlying market fundamentals in North America supported healthy shipment volumes and product margins
•Stable North American downstream backlog volumes due to robust pipeline of new construction projects
•Emerging Businesses Group adjusted EBITDA and adjusted EBITDA margin rebounded sharply, reflecting continued strong demand for our high margin construction solutions
•Europe Steel Group achieved near breakeven results, continuing the trend of improving performance despite a challenging market backdrop


Irving, TX - June 20, 2024 - Commercial Metals Company (NYSE: CMC) today announced financial results for its fiscal third quarter ended May 31, 2024. Net earnings were $119.4 million, or $1.02 per diluted share, on net sales of $2.1 billion, compared to prior year period net earnings of $234.0 million, or $1.98 per diluted share, on net sales of $2.3 billion.

"Adjusted EBITDA," "core EBITDA," "core EBITDA margin," "adjusted earnings" and "adjusted earnings per diluted share" are non-GAAP financial measures. Details, including a reconciliation of each such non-GAAP financial measure to the most directly comparable measure prepared and presented in accordance with GAAP, can be found in the financial tables that follow.

Peter Matt, President and Chief Executive Officer, said, “Our business continued to generate strong financial results during the third quarter, with core EBITDA, core EBITDA margin, cash flows, and net earnings all at levels well above long-term averages. Each of these metrics also improved sequentially as we benefited from a healthy start to the 2024 construction season and solid operational performance across our footprint. Fundamentals remain good within our North American markets, supporting stable to modestly improving steel product margins, healthy shipment levels, and steady downstream backlog volumes. Encouragingly, we are realizing the impact of infrastructure activity on the demand for CMC’s early phase construction solutions, and expect the magnitude of this impact to grow over the next several years."

Mr. Matt added, "Performance in our Europe Steel Group approached breakeven on an adjusted EBITDA basis during the third quarter. Market conditions were largely stable compared to the prior quarter, though we achieved slight increases in finished steel pricing and product margins. Our focus is on continuing to improve the profitability of this business, which we believe should see benefits from an emerging inflection in the Polish


(CMC Third Quarter Fiscal 2024 - 2)

macroeconomic environment, evidenced by meaningfully lower inflation, faster GDP growth, improved residential construction activity, and increased government sponsored investment. Adjusted EBITDA and adjusted EBITDA margin in our Emerging Businesses Group returned to expected levels during the quarter, benefiting from seasonal improvement in construction activity and strong demand for our proprietary geogrid and performance reinforcing steel solutions."

“We continued to advance the ramp up of our state-of-the-art Arizona 2 (AZ2) plant, which is the first micro mill in the world capable of producing both rebar and merchant bar quality (MBQ) product. A combination of supply discipline and improved seasonal demand has moved rebar markets in the Western U.S. into much better balance. Moreover, we have continued to progress our MBQ commissioning. At full production capability, AZ2 is designed to produce nearly 200 individual merchant bar SKUs, in addition to a wide range of rebar sizes. In West Virginia, foundations are nearly complete at the site of our fourth micro mill, and we continue to anticipate an operational start-up in late calendar 2025. We believe these projects, together with our recent acquisitions, position us to take advantage of favorable long-term structural trends in construction activity, and are expected to drive strong future growth in earnings, cash flow, and shareholder value,” Matt concluded.

The Company's balance sheet and liquidity position remained strong. As of May 31, 2024, cash and cash equivalents totaled $698.3 million, with available liquidity of nearly $1.5 billion. During the quarter, CMC repurchased 931,281 shares of common stock valued at $51.8 million in the aggregate. As of May 31, 2024, $458.6 million remained available under the current share repurchase authorization.

On June 19, 2024, the board of directors declared a quarterly dividend of $0.18 per share of CMC common stock payable to stockholders of record on July 1, 2024, representing an increase of approximately 13% on a year-over-year basis. The dividend to be paid on July 10, 2024, marks the 239th consecutive quarterly payment by the Company.

Business Segments - Fiscal Third Quarter 2024 Review
Despite historically high levels of rain, North American demand for CMC’s products was good during the quarter, showing a typical seasonal uplift from the winter months into spring. North America Steel Group finished steel shipments, which include steel products and downstream products, increased 12.3% on a sequential basis but were down modestly compared to the prior year period. Rebar supply and demand were in balance at quarter end as stronger seasonal consumption reduced pockets of excess inventory that had developed within certain regions following disruptive second quarter weather. The construction pipeline remained historically strong, with a large number of potential projects entering the market, as new contract awards continued at a seasonally appropriate pace. Consequently, downstream backlog volumes were generally stable compared to the prior quarter. Demand from industrial end markets, which is important for merchant products, was in-line with the prior year’s third quarter.



(CMC Third Quarter Fiscal 2024 - 3)

Adjusted EBITDA for the North America Steel Group decreased to $246.3 million in the third quarter of fiscal 2024 from $367.6 million in the prior year period. The earnings reduction was driven by lower margins over scrap costs on steel and downstream products, partially offset by improvements in controllable cost performance. During the quarter CMC incurred $11.8 million in costs, net of depreciation, related to the commissioning of its Arizona 2 micro mill, compared to costs of $7.3 million during the prior year period. The adjusted EBITDA margin for the North America Steel Group of 14.7% was consistent with the year-to-date average of 15.5%.

Europe market conditions in the third quarter were similar sequentially, maintaining the marked improvement that emerged during the second quarter compared to late fiscal 2023 and early fiscal 2024. Long-steel consumption remained substantially below historical levels, but better demand in certain end market applications, regional supply discipline, and lower inventories across the supply chain improved steel pricing stability. The Europe Steel Group reported an adjusted EBITDA loss of $4.2 million, continuing the trend of improved financial performance. On a sequential basis, financial results benefited from higher margins over scrap, increased shipment volumes, and lower controllable costs per ton. Europe Steel Group’s average selling price increased $8 per ton from the second quarter of fiscal 2024, while scrap costs decreased by $5 per ton, leading to a $13 per ton margin expansion.

Emerging Businesses Group third quarter net sales of $188.6 million were unchanged from the prior year period and up 20.9% on a sequential basis. Adjusted EBITDA for the segment of $38.2 million was similarly unchanged on a year-over-year basis and was more than double the second quarter level. Sequential improvement in net sales and adjusted EBITDA were driven by seasonally higher construction activity and robust project specific shipments of geogrid solutions and Performance Reinforcing Steel. Sales mix contributed positively to sequential adjusted EBITDA growth, with a greater percentage of geogrid volumes composed of CMC’s highest margin proprietary offering. Demand conditions in the North American markets remained strong during the quarter and CMC experienced good levels of order entry for delivery in future periods. Adjusted EBITDA margin of 20.3% was flat compared to the prior year period.

Outlook
Mr. Matt said, "We expect consolidated financial results in our fiscal fourth quarter to be consistent with third quarter levels. Finished steel shipments within the North America Steel Group are anticipated to be flat on a sequential basis, while adjusted EBITDA margin should remain relatively stable. Adjusted EBITDA for our Europe Steel Group is likely to continue the quarter-to-quarter improvement trend despite market conditions that are expected to remain challenging. Financial results for the Emerging Businesses Group should improve modestly, driven by steady underlying market fundamentals and a healthy order book.”

Mr. Matt added, "The spring and summer construction season is off to a good start, and we are seeing encouraging signs of increased infrastructure activity driving demand. We expect this momentum to build over the


(CMC Third Quarter Fiscal 2024 - 4)

coming quarters, contributing to an already healthy demand backdrop in North America, which is being propelled by positive long-term structural trends in manufacturing, reshoring, energy transition, and energy security-related projects. Additionally, an inflection in interest rates has the potential to unlock pent-up demand in several construction sectors, including residential markets where a significant shortage of housing units exists. In Europe, the Polish macroeconomic environment is showing signs of improvement. Lower inflation and higher rates of economic growth should begin to bolster sentiment in the country and provide greater confidence to build and invest."

Conference Call
CMC invites you to listen to a live broadcast of its third quarter fiscal 2024 conference call today, Thursday, June 20, 2024, at 11:00 a.m. ET. Peter Matt, President and Chief Executive Officer, and Paul Lawrence, Senior Vice President and Chief Financial Officer, 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 CMC
CMC is an innovative solutions provider helping build a stronger, safer, and more sustainable world. Through an extensive manufacturing network principally located in the United States and Central Europe, we offer products and technologies to meet the critical reinforcement needs of the global construction sector. CMC’s solutions support construction across a wide variety of applications, including infrastructure, non-residential, residential, industrial, and energy generation and transmission.



(CMC Third Quarter Fiscal 2024 - 5)

Forward-Looking Statements
This news release contains forward-looking statements within the meaning of the federal securities laws with respect to general economic conditions, key macro-economic drivers that impact our business, the effects of ongoing trade actions, the effects of continued pressure on the liquidity of our customers, potential synergies and growth provided by acquisitions and strategic investments, demand for our products, shipment volumes, metal margins, the ability to operate our steel mills at full capacity, future availability and cost of supplies of raw materials and energy for our operations, growth rates in certain segments, product margins within our Emerging Businesses Group, share repurchases, legal proceedings, construction activity, international trade, the impact of the Russian invasion of Ukraine, capital expenditures, tax credits, our liquidity and our ability to satisfy future liquidity requirements, estimated contractual obligations, the expected capabilities and benefits of new facilities, the timeline for execution of our growth plan and our expectations or beliefs concerning future events. The statements in this release that are not historical statements, are forward-looking statements. These forward-looking statements can generally be identified by phrases such as we or our management "expects," "anticipates," "believes," "estimates," "future," "intends," "may," "plans to," "ought," "could," "will," "should," "likely," "appears," "projects," "forecasts," "outlook" or other similar words or phrases, as well as by discussions of strategy, plans or intentions.

The Company's forward-looking statements are based on management’s expectations and beliefs as of the time this news release was prepared. 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, we undertake 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 any other changes. Important factors that could cause actual results to differ materially from our expectations include those described in our filings with the Securities and Exchange Commission, including, but not limited to, in Part I, Item 1A, "Risk Factors" of our annual report on Form 10-K for the fiscal year ended August 31, 2023, as well as the following: changes in economic conditions which affect demand for our products or construction activity generally, and the impact of such changes on the highly cyclical steel industry; rapid and significant changes in the price of metals, potentially impairing our inventory values due to declines in commodity prices or reducing the profitability of downstream contracts within our vertically integrated steel operations due to rising commodity pricing; excess capacity in our industry, particularly in China, and product availability from competing steel mills and other steel suppliers including import quantities and pricing; the impact of the Russian invasion of Ukraine on the global economy, inflation, energy supplies and raw materials; increased attention to environmental, social and governance ("ESG") matters, including any targets or other ESG or environmental justice initiatives; operating and startup risks, as well as market risks associated with the commissioning of new projects could prevent us from realizing anticipated benefits and could result in a loss of all or a substantial part of our investments; impacts from global public health crises on the economy, demand for our products, global supply chain and on our operations; compliance with and changes in existing and future laws, regulations and other legal requirements and judicial decisions that govern our business, including increased environmental regulations associated with climate change


(CMC Third Quarter Fiscal 2024 - 6)

and greenhouse gas emissions; involvement in various environmental matters that may result in fines, penalties or judgments; evolving remediation technology, changing regulations, possible third-party contributions, the inherent uncertainties of the estimation process and other factors that may impact amounts accrued for environmental liabilities; potential limitations in our or our customers' abilities to access credit and non-compliance with their contractual obligations, including payment obligations; activity in repurchasing shares of our common stock under our share repurchase program; financial and non-financial covenants and restrictions on the operation of our business contained in agreements governing our debt; our ability to successfully identify, consummate and integrate acquisitions and realize any or all of the anticipated synergies or other benefits of acquisitions; the effects that acquisitions may have on our financial leverage; risks associated with acquisitions generally, such as the inability to obtain, or delays in obtaining, required approvals under applicable antitrust legislation and other regulatory and third-party consents and approvals; lower than expected future levels of revenues and higher than expected future costs; failure or inability to implement growth strategies in a timely manner; the impact of goodwill or other indefinite-lived intangible asset impairment charges; the impact of long-lived asset impairment charges; currency fluctuations; global factors, such as trade measures, military conflicts and political uncertainties, including changes to current trade regulations, such as Section 232 trade tariffs and quotas, tax legislation and other regulations which might adversely impact our business; availability and pricing of electricity, electrodes and natural gas for mill operations; our ability to hire and retain key executives and other employees; our ability to successfully manage leadership transitions; competition from other materials or from competitors that have a lower cost structure or access to greater financial resources; information technology interruptions and breaches in security; our ability to make necessary capital expenditures; availability and pricing of raw materials and other items over which we exert little influence, including scrap metal, energy and insurance; unexpected equipment failures; 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 civil unrest, protests and riots.


(CMC Third Quarter Fiscal 2024 - 7)

COMMERCIAL METALS COMPANY AND SUBSIDIARIES
FINANCIAL & OPERATING STATISTICS (UNAUDITED)
 Three Months EndedNine Months Ended
(in thousands, except per ton amounts)5/31/20242/29/202411/30/20238/31/20235/31/20235/31/20245/31/2023
North America Steel Group
Net sales to external customers$1,671,358 $1,486,202 $1,592,650 $1,717,979 $1,818,391 $4,750,210 $4,986,326 
Adjusted EBITDA246,304 222,294 266,820 336,843 367,561 735,418 991,588 
Adjusted EBITDA margin14.7%15.0%16.8%19.6%20.2%15.5%19.9%
External tons shipped
Raw materials3713473743444091,092 1,046 
Rebar5204605225425391,502 1,425 
Merchant bar and other244234230215249708 727 
Steel products7646947527577882,210 2,152 
Downstream products3713163463873821,033 1,079 
Average selling price per ton
Raw materials$970$880$783$838$833$877 $841 
Steel products891905892932979896 994 
Downstream products1,3301,3581,3891,4281,4521,358 1,424 
Cost of raw materials per ton$717$658$578$606$619$651 $617 
Cost of ferrous scrap utilized per ton$353$379$343$338$384$358 $352 
Steel products metal margin per ton$538$526$549$594$595$538 $642 
Europe Steel Group
Net sales to external customers$208,806$192,500$225,175$273,961$330,767$626,481 $1,054,830 
Adjusted EBITDA(4,192)(8,611)38,942(30,081)5,83726,139 78,554 
Adjusted EBITDA margin(2.0)%(4.5)%17.3%(11.0)%1.8%4.2%7.4%
External tons shipped
Rebar8064122151146266 533 
Merchant bar and other217211221238283649 805 
Steel products297275343389429915 1,338 
Average selling price per ton
Steel products$681$673$633$682$753$661$768 
Cost of ferrous scrap utilized per ton$389$394$365$398$427$383$395 
Steel products metal margin per ton$292$279$268$284$326$278$373 
Emerging Businesses Group
Net sales to external customers$188,593$155,994$177,239$208,559$189,055$521,826$513,187
Adjusted EBITDA38,22017,92930,86242,61238,39587,01196,372
Adjusted EBITDA margin20.3%11.5%17.4%20.4%20.3%16.7%18.8%




(CMC Third Quarter Fiscal 2024 - 8)

COMMERCIAL METALS COMPANY AND SUBSIDIARIES
BUSINESS SEGMENTS (UNAUDITED)
Three Months EndedNine Months Ended
(in thousands)5/31/20242/29/202411/30/20238/31/20235/31/20235/31/20245/31/2023
Net sales to external customers
North America Steel Group$1,671,358 $1,486,202 $1,592,650 $1,717,979 $1,818,391 $4,750,210 $4,986,326 
Europe Steel Group208,806 192,500 225,175 273,961 330,767 626,481 1,054,830 
Emerging Businesses Group188,593 155,994 177,239 208,559 189,055 521,826 513,187 
Corporate and Other9,728 13,591 7,987 8,729 6,776 31,306 35,962 
Total net sales to external customers$2,078,485 $1,848,287 $2,003,051 $2,209,228 $2,344,989 $5,929,823 $6,590,305 
Adjusted EBITDA
North America Steel Group$246,304 $222,294 $266,820 $336,843 $367,561 $735,418 $991,588 
Europe Steel Group(4,192)(8,611)38,942 (30,081)5,837 26,139 78,554 
Emerging Businesses Group38,220 17,929 30,862 42,612 38,395 87,011 96,372 
Corporate and Other(37,070)(34,512)(30,987)(38,171)(37,715)(102,569)(93,013)
Total adjusted EBITDA$243,262 $197,100 $305,637 $311,203 $374,078 $745,999 $1,073,501 




(CMC Third Quarter Fiscal 2024 - 9)

COMMERCIAL METALS COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED)
 Three Months Ended May 31,Nine Months Ended May 31,
(in thousands, except share and per share data)2024202320242023
Net sales$2,078,485 $2,344,989 $5,929,823 $6,590,305 
Costs and operating expenses: 
Cost of goods sold1,738,086 1,862,299 4,894,200 5,203,476 
Selling, general and administrative expenses167,975 163,742 497,951 470,902 
Interest expense12,117 8,878 35,751 31,868 
Net costs and operating expenses1,918,178 2,034,919 5,427,902 5,706,246 
Earnings before income taxes160,307 310,070 501,921 884,059 
Income taxes40,867 76,099 120,361 208,465 
Net earnings$119,440 $233,971 $381,560 $675,594 
Earnings per share:
Basic$1.03 $2.00 $3.28 $5.76 
Diluted1.02 1.98 3.25 5.69 
Cash dividends per share$0.18 $0.16 $0.50 $0.48 
Average basic shares outstanding115,529,942 117,066,623 116,228,826 117,192,710 
Average diluted shares outstanding116,664,885 118,397,899 117,583,055 118,747,084 
 



(CMC Third Quarter Fiscal 2024 - 10)

COMMERCIAL METALS COMPANY AND SUBSIDIARIES
 CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(in thousands, except share and per share data)May 31, 2024August 31, 2023
Assets
Current assets:
Cash and cash equivalents$698,338 $592,332 
Accounts receivable (less allowance for doubtful accounts of $4,375 and $4,135)
1,182,269 1,240,217 
Inventories, net1,075,176 1,035,582 
Prepaid and other current assets283,845 276,024 
Total current assets3,239,628 3,144,155 
Property, plant and equipment, net2,511,865 2,409,360 
Intangible assets, net239,691 259,161 
Goodwill383,900 385,821 
Other noncurrent assets335,147 440,597 
Total assets$6,710,231 $6,639,094 
Liabilities and stockholders' equity
Current liabilities:
Accounts payable$303,057 $364,390 
Accrued expenses and other payables399,026 438,811 
Current maturities of long-term debt and short-term borrowings62,871 40,513 
Total current liabilities764,954 843,714 
Deferred income taxes286,078 306,801 
Other noncurrent liabilities262,535 253,181 
Long-term debt1,137,602 1,114,284 
Total liabilities2,451,169 2,517,980 
Stockholders' equity:
Common stock, par value $0.01 per share; authorized 200,000,000 shares; issued 129,060,664 shares; outstanding 115,104,191 and 116,515,427 shares
1,290 1,290 
Additional paid-in capital398,851 394,672 
Accumulated other comprehensive loss(90,689)(3,778)
Retained earnings4,420,633 4,097,262 
Less treasury stock, 13,956,473 and 12,545,237 shares at cost
(471,271)(368,573)
Stockholders' equity4,258,814 4,120,873 
Stockholders' equity attributable to non-controlling interests248 241 
Total stockholders' equity4,259,062 4,121,114 
Total liabilities and stockholders' equity$6,710,231 $6,639,094 





(CMC Third Quarter Fiscal 2024 - 11)

COMMERCIAL METALS COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
 Nine Months Ended May 31,
(in thousands)20242023
Cash flows from (used by) operating activities:
Net earnings$381,560 $675,594 
Adjustments to reconcile net earnings to net cash flows from operating activities:
Depreciation and amortization208,177 157,528 
Stock-based compensation35,893 44,000 
Write-down of inventory6,586 8,931 
Deferred income taxes and other long-term taxes(4,066)34,815 
Other3,684 6,179 
Settlement of New Markets Tax Credit transaction— (17,659)
Changes in operating assets and liabilities, net of acquisitions(83,943)25,291 
Net cash flows from operating activities
547,891 934,679 
Cash flows from (used by) investing activities:
Capital expenditures(242,803)(439,742)
Acquisitions, net of cash acquired— (167,069)
Other1,856 1,649 
Net cash flows used by investing activities
(240,947)(605,162)
Cash flows from (used by) financing activities:
Repayments of long-term debt(27,484)(380,700)
Debt issuance and extinguishment— (1,896)
Proceeds from accounts receivable facilities142,015 242,408 
Repayments under accounts receivable facilities(122,284)(244,105)
Treasury stock acquired(128,164)(82,839)
Tax withholdings related to share settlements, net of purchase plans(8,563)(13,665)
Dividends(58,189)(56,257)
Contribution from non-controlling interest7 9 
Net cash flows used by financing activities
(202,662)(537,045)
Effect of exchange rate changes on cash511 6,970 
Increase (decrease) in cash, restricted cash, and cash equivalents
104,793 (200,558)
Cash, restricted cash and cash equivalents at beginning of period595,717 679,243 
Cash, restricted cash and cash equivalents at end of period$700,510 $478,685 
Supplemental information:
Cash paid for income taxes$131,229 $150,658 
Cash paid for interest35,604 51,305 
Cash and cash equivalents$698,338 $475,489 
Restricted cash2,172 3,196 
Total cash, restricted cash and cash equivalents$700,510 $478,685 


(CMC Third Quarter Fiscal 2024 - 12)

COMMERCIAL METALS COMPANY
NON-GAAP FINANCIAL MEASURES (UNAUDITED)

This press release contains financial measures not derived in accordance with U.S. generally accepted accounting principles ("GAAP"). Reconciliations to the most comparable GAAP measure are provided below.

Adjusted EBITDA, core EBITDA, core EBITDA margin and adjusted earnings are non-GAAP financial measures. Adjusted earnings per diluted share is defined as adjusted earnings on a diluted per share basis. Core EBITDA margin is defined as core EBITDA divided by net sales. The adjustment “Settlement of New Markets Tax Credit transaction” represents the recognition of deferred revenue from 2016 and 2017 resulting from the Company’s participation in the New Markets Tax Credit program provided for in the Community Renewal Tax Relief Act of 2000 during the development of a micro mill, spooler and T-post shop located in eligible zones as determined by the Internal Revenue Service. In prior periods, the Company included within the
definition of core EBITDA, core EBITDA margin, adjusted earnings and adjusted earnings per diluted share an adjustment for “Mill operational commissioning costs” related to the Company’s third micro mill, which was placed into service during the fourth quarter of fiscal 2023. Periods commencing subsequent to February 29, 2024 no longer include an adjustment for mill operational commissioning costs. Accordingly, the Company has recast core EBITDA, core EBITDA margin, adjusted earnings and adjusted earnings per diluted share for all prior periods to conform to this presentation.

Non-GAAP financial measures should be viewed in addition to, and not as alternatives for, the most directly comparable measures derived in accordance with GAAP and may not be comparable to similar measures presented by other companies. However, we believe that the non-GAAP financial measures provide relevant and useful information to management, investors, analysts, creditors and other interested parties in our industry as they allow: (i) comparison of our earnings to those of our competitors; (ii) a supplemental measure of our underlying business operational performance; and (iii) the assessment of period-to-period performance trends. Management uses non-GAAP financial measures to evaluate financial performance and set target benchmarks for annual and long-term cash incentive performance plans.

A reconciliation of net earnings to adjusted EBITDA and core EBITDA is provided below:
Three Months EndedNine Months Ended
(in thousands)5/31/20242/29/202411/30/20238/31/20235/31/20235/31/20245/31/2023
Net earnings$119,440 $85,847 $176,273 $184,166 $233,971 $381,560 $675,594 
Interest expense12,117 11,878 11,756 8,259 8,878 35,751 31,868 
Income taxes40,867 31,072 48,422 53,742 76,099 120,361 208,465 
Depreciation and amortization70,692 68,299 69,186 61,302 55,129 208,177 157,528 
Asset impairments146 4 — 3,734 1 150 46 
Adjusted EBITDA243,262 197,100 305,637 311,203 374,078 745,999 1,073,501 
Non-cash equity compensation12,846 14,988 8,059 16,529 10,376 35,893 44,000 
Settlement of New Markets Tax Credit transaction— — — — — — (17,659)
Core EBITDA$256,108 $212,088 $313,696 $327,732 $384,454 $781,892 $1,099,842 
Net sales$2,078,485 $1,848,287 $2,003,051 $2,209,228 $2,344,989 $5,929,823 $6,590,305 
Core EBITDA margin12.3%11.5%15.7%14.8%16.4%13.2%16.7%



(CMC Third Quarter Fiscal 2024 - 13)

A reconciliation of net earnings to adjusted earnings is provided below:
 Three Months EndedNine Months Ended
(in thousands, except per share data)5/31/20242/29/202411/30/20238/31/20235/31/20235/31/20245/31/2023
Net earnings$119,440 $85,847 $176,273 $184,166 $233,971 $381,560 $675,594 
Asset impairments146 4 — 3,734 1 150 46 
Settlement of New Markets Tax Credit transaction— — — — — — (17,659)
Total adjustments (pre-tax)$146 $4 $— $3,734 $1 $150 $(17,613)
Related tax effects on adjustments(31)(1)— (784)— (32)3,699 
Adjusted earnings$119,555 $85,850 $176,273 $187,116 $233,972 $381,678 $661,680 
Net earnings per diluted share(1)
$1.02 $0.73 $1.49 $1.56 $1.98 $3.25 $5.69 
Adjusted earnings per diluted share(1)
$1.02 $0.73 $1.49 $1.58 $1.98 $3.25 $5.57 
__________________________________
(1) Net earnings per diluted share and adjusted earnings per diluted share are calculated independently for each three month period and may not sum to the year to date period due to rounding.







Media Contact:
Susan Gerber
(214) 689-4300

Q3 FY 2024 Supplemental Slides

 
2Q3 FY24 Supplemental Slides June 20, 2024 This presentation contains forward-looking statements within the meaning of the federal securities laws with respect to general economic conditions, key macro-economic drivers that impact our business, the effects of ongoing trade actions, the effects of continued pressure on the liquidity of our customers, potential synergies and growth provided by acquisitions and strategic investments, demand for our products, shipment volumes, metal margins, the ability to operate our steel mills at full capacity, future availability and cost of supplies of raw materials and energy for our operations, growth rates in certain segments, product margins within our Emerging Businesses Group, share repurchases, legal proceedings, construction activity, international trade, the impact of the Russian invasion of Ukraine, capital expenditures, tax credits, our liquidity and our ability to satisfy future liquidity requirements, estimated contractual obligations, the expected capabilities and benefits of new facilities, the timeline for execution of our growth plan and our expectations or beliefs concerning future events. The statements in this presentation that are not historical statements, are forward-looking statements. These forward-looking statements can generally be identified by phrases such as we or our management “expects,” “anticipates,” “believes,” “estimates,” “future,” “intends,” “may,” “plans to,” “ought,” “could,” “will,” “should,” “likely,” “appears,” “projects,” “forecasts,” “outlook” or other similar words or phrases, as well as by discussions of strategy, plans or intentions. Our forward-looking statements are based on management’s expectations and beliefs as of the date of this presentation. 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, we undertake 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 any other changes. Important factors that could cause actual results to differ materially from our expectations include those described in our filings with the Securities and Exchange Commission, including, but not limited to, in Part I, Item 1A, “Risk Factors” of our annual report on Form 10-K for the fiscal year ended August 31, 2023, as well as the following: changes in economic conditions which affect demand for our products or construction activity generally, and the impact of such changes on the highly cyclical steel industry; rapid and significant changes in the price of metals, potentially impairing our inventory values due to declines in commodity prices or reducing the profitability of downstream contracts within our vertically integrated steel operations due to rising commodity pricing; excess capacity in our industry, particularly in China, and product availability from competing steel mills and other steel suppliers including import quantities and pricing; the impact of the Russian invasion of Ukraine on the global economy, inflation, energy supplies and raw materials; increased attention to environmental, social and governance (“ESG”) matters, including any targets or other ESG or environmental justice initiatives; operating and start-up risks, as well as market risks associated with the commissioning of new projects could prevent us from realizing anticipated benefits and could result in a loss of all or a substantial part of our investments; impacts from global public health crises on the economy, demand for our products, global supply chain and on our operations; compliance with and changes in existing and future laws, regulations and other legal requirements and judicial decisions that govern our business, including increased environmental regulations associated with climate change and greenhouse gas emissions; involvement in various environmental matters that may result in fines, penalties or judgments; evolving remediation technology, changing regulations, possible third-party contributions, the inherent uncertainties of the estimation process and other factors that may impact amounts accrued for environmental liabilities; potential limitations in our or our customers' abilities to access credit and non-compliance with their contractual obligations, including payment obligations; activity in repurchasing shares of our common stock under our share repurchase program; financial and non-financial covenants and restrictions on the operation of our business contained in agreements governing our debt; our ability to successfully identify, consummate and integrate acquisitions and realize any or all of the anticipated synergies or other benefits of acquisitions; the effects that acquisitions may have on our financial leverage; risks associated with acquisitions generally, such as the inability to obtain, or delays in obtaining, required approvals under applicable antitrust legislation and other regulatory and third-party consents and approvals; lower than expected future levels of revenues and higher than expected future costs; failure or inability to implement growth strategies in a timely manner; the impact of goodwill or other indefinite-lived intangible asset impairment charges; the impact of long-lived asset impairment charges; currency fluctuations; global factors, such as trade measures, military conflicts and political uncertainties, including changes to current trade regulations, such as Section 232 trade tariffs and quotas, tax legislation and other regulations which might adversely impact our business; availability and pricing of electricity, electrodes and natural gas for mill operations; our ability to hire and retain key executives and other employees; our ability to successfully manage leadership transitions; competition from other materials or from competitors that have a lower cost structure or access to greater financial resources; information technology interruptions and breaches in security; our ability to make necessary capital expenditures; availability and pricing of raw materials and other items over which we exert little influence, including scrap metal, energy and insurance; unexpected equipment failures; 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 civil unrest, protests and riots. Forward-Looking Statements

 
3Q3 FY24 Supplemental Slides June 20, 2024 Leading positions in core products and geographies Focused strategy that leverages capabilities, competitive strengths, and market knowledge Strong balance sheet and cash generation provide flexibility to execute on strategy Vertical structure optimizes returns through the entire value chain Disciplined capital allocation focused on maximizing returns for our shareholders Increasing Shareholder Value With a Winning Formula

 
4 YTD 2022 YTD 2023 YTD 2024 YTD 2022 YTD 2023 YTD 2024 YTD 2022 YTD 2023 YTD 2024 YTD 2022 YTD 2023 YTD 2024 CMC Incident Rate U.S. Steel Industry Continued Progress in Keeping Our People Safe [1] Domestic steel industry data is for Iron and Steel Mills (NAICS – 3311) from the Bureau of Labor Statistics [2] Data is through the end of the fiscal third quarter for YTD 2022, YTD 2023, and YTD 2024 Q3 FY24 Supplemental Slides June 20, 2024 CMC and Domestic Steel Industry1 Total Recordable Incident Rate by Year Continual improvement has resulted from our concentrated focus on safety and culture. Total CMC North America Steel Group Europe Steel Group Emerging Businesses Group Total Recordable Incident Rate by Segment2 In FY 2024, we are doing an even better job at keeping our people safe.

 
5 Third quarter financial results at levels well above long-term averages • Net earnings, core EBITDA, core EBITDA margin, cash flows, and return on invested capital at historically strong levels Solid seasonal demand and healthy underlying market fundamentals in North America • Experienced typical seasonal demand improvement • Steel product margins increased modestly from prior quarter • Stability in downstream backlog volumes Positive North America long-term outlook is intact, supported by infrastructure spending programs and investments in large-scale industrial and energy projects Europe Steel Group nearing breakeven; market conditions consistent with prior quarter Emerging Businesses Group profitability rebounded sharply, driven by increased volume of its high margin solutions and seasonally higher activity Solid financial position • Balance sheet strength and cash flow profile continue to provide capital allocation flexibility Q3 FY24 Supplemental Slides June 20, 2024 [1] Core EBITDA, core EBITDA margin, and return on invested capital are non-GAAP financial measures. For definitions and reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measures, see the appendix to this document. $119M Q3 Net Earnings $1.02 Q3 Diluted EPS $256M Q3 Core EBITDA1 12.3% Q3 Core EBITDA Margin1 11.3% Last 12 Months ROIC1 $52M Q3 Share Repurchases Key Takeaways From Today’s Call

 
6 6% 10% 8% 9% 9% 12% 12% 17% 16% 13% – 2% 4% 6% 8% 10% 12% 14% 16% 18% 20% FY '15 FY '16 FY '17 FY '18 FY '19 FY '20 FY '21 FY '22 FY '23 FY '24 (YTD) • Strategic transformation has brought significant scale and earnings growth • Industry landscape has dramatically improved over the last five years • CMC has leveraged growth to generate higher, more sustainable margins • Margins are normalizing well above pre-pandemic levels • Returns on invested capital have been substantially above cost of capital • CMC is creating significant value for shareholders Structurally Improved Margins and Return Profile Q3 FY24 Supplemental Slides June 20, 2024 6% 5% 4% 9% 11% 12% 15% 26% 17% 11% – 5% 10% 15% 20% 25% 30% FY '15 FY '16 FY '17 FY '18 FY '19 FY '20 FY '21 FY '22 FY '23 Q3 '24 (L12M) % CMC Consolidated Core EBITDA Margin1 CMC Return on Invested Capital1 Normalizing above historical levels Normalizing above historical levels Margins and return levels are normalizing above historical levels [1] Core EBITDA margin and return on invested capital are non-GAAP financial measures. For definitions and reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measures, see the appendix to this document.

 
7 The Path Ahead – Running and Growing a Great Business Q3 FY24 Supplemental Slides June 20, 2024 • Focus on people to ensure safety and provide talent development opportunities • Enact operational and commercial excellence efforts that span all levels of the enterprise • Drive to achieve sustainably higher, less volatile, through-the-cycle margins Running a Great Business • Successful commissioning of micro mill projects; capture available internal synergies • Investment to support growth in high margin proprietary solutions • Investment in automation and efficiency gains, including to support operational and commercial excellence efforts Value Accretive Organic Growth • Broaden CMC’s commercial portfolio and improve customer value proposition through expansion into adjacent markets • Strengthen existing business through commercial synergies or internal demand pull • Meaningfully extend CMC’s growth runway Capability Enhancing Inorganic Growth Following the strategic transformation of the last decade, CMC is charting the course for its next phase of growth

 
8 Forecasted Construction Starts – inflation adjusted (% change compared to average of 2019 to 20222) – 5% 10% 15% 20% 25% 2023 2024 2025 2026 – 10% 20% 30% 40% 50% 60% 70% 2023 2024 2025 2026 – 5% 10% 15% 20% 25% 30% 2023 2024 2025 2026 Estimated Potential Impact on Rebar Demand1 Government Support for Investment Structural Trends Expected to Support North American Construction RESHORING AND SUPPLY CHAIN REALIGNMENT ENERGY TRANSITION AND LNG INVESTMENTS Significant structural investment is expected to power domestic construction and rebar consumption over a multi-year period. In addition to direct investments, the follow-on indirect impact should also be meaningful as many large-scale projects will require local investments in infrastructure, non-residential structures, and residential dwellings. [1] Company estimates; potential increase to demand is at full run-rate of programs and relative to current annual domestic demand of ~9 million tons [2] Dodge Analytics Construction Starts Forecast – Q2 2024 Edition INFRASTRUCTURE INVESTMENT $550B from Infrastructure Investment and Jobs Act $52B CHIPS Act $250B Inflation Reduction Act $12B DOE loans Funding from IRA Q3 FY24 Supplemental Slides June 20, 2024 +15% to 17% +3% to 5% +2% to 4% Public Works Manufacturing Power & Utilities

 
9 Individual markets Broad market segmentDo m es tic R eb ar C on su m pt io n Br ea kd ow n3 Rebar Demand Growth from Highway Construction Has Begun Q3 FY24 Supplemental Slides June 20, 2024 27 0 5 10 15 20 25 30 Im pr ov em en ts Si ng le fa m ily M ul ti- fa m ily Pu bl ic u til ity Ed uc at io na l O ff ic e Lo dg in g H ea lth ca re Co m & In du st ria l Se w er s ys te m s H ig hw ay s Co ns er va tio n Residential Nonresidential Infra Re ba r C on su m pt io n In te ns ity 4 (t on s pe r $ m ill io n) Average: 6 +13% Average increase to State DOT budgets for FY 20241 +4% Forecasted growth in cement consumption for highway and street construction (2024 vs. 2023)2 +16% Forecasted growth in highway and street construction spending (2024 vs. 2023)1 Highway construction is the largest and most rebar intensive end market +5% Forecasted growth in cement consumption for highway and street construction (2025 vs. 2024)2 2024 should be a strong year for highway investment • Large highway projects associated with the Infrastructure Investment and Jobs Act are entering construction phase • CMC is beginning to see the impact of increased highway activity on its business − Shipments of rebar to highway projects increased during the third quarter − CMC’s other reinforcement and stabilization solutions are also benefiting • There is a healthy pipeline of projects, and CMC is seeing good letting activity across many of its key states • Highway construction activity is expected to gain further momentum over the coming quarters as recently awarded projects begin construction Further improvement is expected in 2025 [1] State DOT budget data and 2024 highway and street construction spending forecast from American Road and Transportation Builders’ Association [2] Cement consumption forecast from Portland Cement Association [3] Based on data from the Construction Reinforcing Steel Institute [4] Rebar intensities equal to consumption by structure type per Concrete Reinforcing Steel Institute divided by total construction spending by structure type per the U.S. Census Bureau

 
10 GDP Growth Outlook Polish economy is expected to grow by 2.8% in 2024 per S&P Recent Market Developments Europe Market Environment Remained Challenging [1] Data from S&P Global manufacturing PMI report [2] Data from Statistics Poland for February 2024 to April 2024 vs. February 2023 to April 2023 [3] Based on data from Eurostat (trailing 3 months to March 2024 vs. trailing 3 months to March 2023) Emerging green shoots: • Residential construction market is beginning to recover; new housing permits and the number of units under construction have rebounded strongly • Expected release of €65 billion to Poland from the EU Recovery and Resilience fund Conditions during the third quarter were consistent with the second quarter, which were difficult but improved from late fiscal 2023 and early fiscal 2024. Signs are emerging that the Polish economy has reached a positive inflection. Demand Supply Costs Macroeconomic Backdrop Manufacturing Germany and Poland PMIs below 50 for 23 consecutive months1 Energy Costs Natural gas purchase contracts repriced Apr 1, 2024; reduced cost per ton by $10 Long Product Imports Polish imports of long steel products from EU nations are up meaningfully y/y3 Residential Construction Housing permits granted up 29% y/y2 Total Construction Polish cement sales down 6% vs 2021/22 seasonal average Long Product Production Polish long steel production down ~17% y/y2 and 20% vs 2021/22 seasonal avg Electricity Procurement Terminated trailing 8-qtr hedge and entered new fixed price hedge; effective cost should decline Interest Rates Residential mortgage rates and corporate borrowing rates down 100 bps y/y Cost Position Leading cost position in Europe; controllable costs per ton down y/y and q/q Inflation May 2024 reading of 2.5% y/y increase was down significantly from 2023 high of 18.4% Q3 FY24 Supplemental Slides June 20, 2024

 
11 • Consolidated financial results in the fourth quarter are anticipated to be similar to third quarter levels • North America Steel Group finished steel shipments should be flat on a sequential basis, while adjusted EBITDA margin is also expected to be stable • Europe Steel Group adjusted EBITDA in the fourth quarter is expected to continue to trend toward near breakeven • Modest improvement in financial results is expected for Emerging Businesses Group, driven by steady underlying market fundamentals and a healthy order book • Demand conditions in North America remained supportive with normal seasonal uplift from winter to spring months − Finished steel shipments decreased 3.0% y/y, while rebar shipments (mill direct rebar and downstream) declined 3.3% from the prior year period • North America Steel Group steel product margin improved sequentially with steel price declining less than scrap cost − Steel product margin declined $57 per ton from the prior year period • Downstream product margins over scrap1 remained well above historical levels, but declined $155 per ton from the prior year period • North America Steel Group controllable costs per ton decreased on y/y basis − Adjusted EBITDA in third quarter of fiscal 2024 included $11.8 million related to Arizona 2 commissioning costs compared to $7.3 million during the third quarter of fiscal 2023 • Market conditions for the Europe Steel Group were stable compared to the prior quarter, but remained challenging – domestic producers continue to demonstrate supply discipline − Steel product margins over scrap cost increased by $13 per ton from the sequential quarter − Shipments increased by 8% from the sequential quarter • Emerging Businesses Group net sales and adjusted EBITDA margin were flat y/y − Positive impacts from the addition of CMC Anchoring Systems, strong geogrid demand, and increased shipments of proprietary reinforcing steel products were largely offset by weather related slowness at Texas-centric CMC Construction Services. Pe rf or m an ce D riv er s O ut lo ok Q3 Operational Update [1] Downstream Product Margin Over Scrap equals Average Selling Price minus cost of ferrous scrap utilized during the prior quarter Q3 FY24 Supplemental Slides June 20, 2024

 
12 384 256 (121) (10) 1 2 0 50 100 150 200 250 300 350 400 Q3 2023 NA Steel Group EBITDA Europe Steel Group EBITDA Emerging Businesses Group EBITDA Corp & Eliminations Other Non- Op Items Q3 2024 Q3 Consolidated Operating Results Q3 ’23 Q4 ’23 Q1 ’24 Q2 ’24 Q3 ’24 External Finished Steel Tons Shipped1 1,599 1,533 1,441 1,285 1,432 Core EBITDA2 $384,454 $327,732 $313,696 $212,088 $256,108 Core EBITDA per Ton of Finished Steel Shipped2 $240 $214 $218 $165 $179 Core EBITDA Margin2 16.4% 14.8% 15.7% 11.5% 12.3% Net Earnings $233,971 $184,166 $176,273 $85,847 $119,440 Performance Summary Units in 000’s except per ton amounts and margin • Costs related to commissioning activities at Arizona 2 micro mill − $21.8 million impact to pre-tax income (includes depreciation) − $11.8 million impact to core EBITDA (excludes depreciation) Arizona 2 Commissioning Costs Figures are pre-tax for Q3 2024 [1] External Finished Steel Tons Shipped equal to shipments of Steel Products plus Downstream Products [2] Core EBITDA, Core EBITDA margin, and Core EBITDA per ton of finished steel shipped are non-GAAP measures. For reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measures, see the appendix to this document. Core EBITDA Bridge – Q3 2023 to Q3 2024 $ Millions Q3 FY24 Supplemental Slides June 20, 2024

 
13 314 217 8 (60) (50) 5 100 125 150 175 200 225 250 275 300 325 Q3 '23 Adj EBITDA per Ton Raw Materials Steel Products Downstream Controllable Cost & Other Q3 '24 Adj EBITDA per Ton 314 294 243 220 217 1,106 1,044 1,051 1,015 951 595 594 549 526 538 0 50 100 150 200 250 300 350 0 200 400 600 800 1,000 1,200 Q3 '23 Q4 '23 Q1' 24 Q2 '24 Q3 '24 Adjusted EBITDA per Ton of Finished Steel Shipped Downstream Products Margin Over Scrap (1 Qtr Lag) Steel Products Margin Over Scrap Key Performance Drivers Q3 2024 vs Q3 2023 Q3 North America Steel Group Q3 ’23 Q4 ’23 Q1 ’24 Q2 ’24 Q3 ’24 External Finished Steel Tons Shipped1 1,170 1,144 1,098 1,010 1,135 Adjusted EBITDA $367,561 $336,843 $266,820 $222,294 $246,304 Adjusted EBITDA per Ton of Finished Steel Shipped $314 $294 $243 $220 $217 Adjusted EBITDA Margin 20.2% 19.6% 16.8% 15.0% 14.7% Performance Summary Units in 000’s except per ton amounts and margin • Decline in steel product margins over scrap cost − Down approximately $57 per ton y/y • Downstream product margins2 over scrap cost remained well above historical levels, but declined by approximately $155 per ton from a year ago − Full value chain profitability on sales of downstream products above long-term average • Commissioning costs related to the operational start-up of Arizona 2 increased approximately $4.5 million compared to the prior year period • Controllable cost performance contributed positively to financial results compared to the prior year period (includes Arizona 2 commissioning costs) [1] External Finished Steel Tons Shipped equal to shipments of Steel Products plus Downstream Products [2] Downstream Product Margin Over Scrap equals Average Selling Price minus cost of ferrous scrap utilized during the prior quarter [3] Steel Products Margin Over Scrap equals Average Selling Price minus Cost of ferrous scrap utilized North America Steel Group – Key Margins $ / ton SP a nd D P M ar gi n O ve r S cr ap Adjusted EBITDA per ton Adjusted EBITDA Per Ton Bridge – Q3 2023 to Q3 2024 $ / ton of external finished steel shipped 2 3 2 Impact of Volume and Margin Over Scrap Cost Q3 FY24 Supplemental Slides June 20, 2024

 
14 (60%) (40%) (20%) – 20% 40% 60% 80% 100% Dwellings Under Construction New Residential Building Permits 326 284 268 279 292 14 (77) 114 (31) (14) (100) (50) 0 50 100 150 200 250 300 350 Q3 '23 Q4 '23 Q1' 24 Q2 '24 Q3 '24 Steel Products Margin Over Scrap Adjusted EBITDA per Ton Key Performance Drivers Q3 2024 vs Q3 2023 Q3 Europe Steel Group Q3 ’23 Q4 ’23 Q1 ’24 Q2 ’24 Q3 ’24 External Finished Steel Tons Shipped1 429 389 343 275 297 Adjusted EBITDA $5,837 ($30,081) $38,942 ($8,611) ($4,192) Adjusted EBITDA per Ton of Finished Steel Shipped $14 ($77) $114 ($31) ($14) Adjusted EBITDA Margin 1.8% (11.0%) 17.3% (4.5%) (2.0%) Performance Summary Units in 000’s except per ton amounts and margin • Margins over scrap declined from the prior year period − Down $34 per ton y/y • Shipment volumes declined 31% from the prior year period • Controllable costs per ton improved meaningfully from the prior year, driven by lower energy costs and operational measures Europe Steel Group – Key Margins $ / ton Poland New Mortgage Originations and Dwellings Under Construction3 % year-over-year change 2 Notes: [1] External Finished Steel Tons Shipped equal to shipments of Steel Products [2] Steel Products Margin Over Scrap equals Average Selling Price minus Cost of ferrous scrap utilized [3] Source: Statistics Poland M ar gi n O ve r S cr ap a nd A dj us te d EB IT DA p er to n Q3 FY24 Supplemental Slides June 20, 2024

 
15 189 189 (0%) (7%) (3%) 5% 6% 100 110 120 130 140 150 160 170 180 190 200 Q3 2023 Geogrids & Geopiers Construction Services Impact Metals Performance Reinforcing Steel Anchoring Systems Q3 2024 Key Performance Drivers Q3 2024 vs Q3 2023 Q3 Emerging Businesses Group Q3 ’23 Q4 ’23 Q1 ’24 Q2 ’24 Q3 ’24 Net sales from external customers $189,055 $208,559 $177,239 $155,994 $188,593 Adjusted EBITDA $38,395 $42,612 $30,862 $17,929 $38,220 Adjusted EBITDA Margin 20.3% 20.4% 17.4% 11.5% 20.3% Performance Summary Units in 000’s except margins • Strong margin performance for geogrids, driven by adoption of latest proprietary offering • Meaningful y/y increase in shipment volumes of Performance Reinforcing Steel, particularly Galvabar and ChromX • Addition of CMC Anchoring Systems contributed to net sales and adjusted EBITDA on a y/y basis • Wet weather in Texas slowed activity levels and reduced profitability at CMC Construction Services locations Contribution to Net Sales Change – Q3 2023 to Q3 2024 Quarterly net sales figures in $ million, contribution to net sales changes provided in percentages Q3 FY24 Supplemental Slides June 20, 2024 Q ua rt er ly n et s al es in $ m ill io n; ne t s al es c ha ng es in p er ce nt ag es Net sales flat Directional Change in Underlying Margin Performance

 
16 • Third quarter 2024 capital expenditures of $82.0 million • Year-to-date capital expenditures of $242.8 million • FY 2024 total spend forecasted at $400 million to $425 million − Shortfall to previous guidance related to timing of equipment delivery at Steel West Virginia, which will not impact start-up date • Targeting growth expenditures on key mill projects that will strengthen market presence and lower cost Disciplined Capital Allocation Strategy CMC will prudently allocate capital while maintaining a strong and flexible balance sheet Q3 FY24 Supplemental Slides June 20, 2024 [1] Defined as dividend payments divided by net earnings 2 31 Value-Generating Growth Shareholder Distributions Debt ManagementCMC Capital Allocation Priorities: Capital Expenditures Acquisitions Share Repurchases Dividends • No acquisitions year-to-date • Acquisitions totaling $235 million completed in FY 2023 • Targeting opportunities to: − Expand commercial portfolio − Add operational capabilities − Strengthen existing businesses • Disciplined approach to valuation • Increased share repurchase authorization by $500 million in January − $458.6 million remaining as of May 31 • Repurchased 931,281 shares during the third quarter valued at $51.8 million • Year-to-date repurchases totaled $128.2 million, up 55% compared to a year ago • Increased quarterly dividend per share to $0.18 in March − Represented growth of 13% compared to previous quarterly rate • Year-to-date payout ratio1 of 15% • Quarterly dividend per share has increased by 50% since October 2021 Focus on Growth Targeting value accretive growth that strategically strengthens our business Competitive Cash Distributions Goal is to provide an attractive rate of cash distributions to our shareholders

 
17 539 5 37 2 141 155 279 380 1,270 911 $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 LTM Q3 '24 Cash Generation Profile Adjusted EBITDA Less Sustaining Capital Expenditures and Disbursements to Stakeholders1 (in millions) CMC’s cash flow capabilities have been greatly enhanced through our strategic transformation FY 2024 capital expenditures expected in a range of $400 million to $425 million Source: Public filings, Internal data [1] Adjusted EBITDA less Sustaining Capital Expenditures and Disbursements to Stakeholders is a non-GAAP financial measure. For reconciliations of non- GAAP financial measures to the most directly comparable GAAP financial measures, see the appendix to this document. Gain on California land sale Q3 FY24 Supplemental Slides June 20, 2024

 
18 $45 $150 $599 $698 $300 $300 $300 $145 $600 2024 2025 2026 2027 2028 2029 2030 2031 2032 2047 Balance Sheet Strength [1] 2047 tax-exempt bonds were priced to yield 3.5%; coupon rate is 4.0% Revolver Poland Credit Facilities (US$ in millions) Revolving Credit Facility 4.125% Notes Cash and Cash Equivalents 3.875% Notes Debt maturity profile provides strategic flexibility Debt Maturity Profile Q3 FY’24 Liquidity (US$ in millions) 4.375% Notes 4.0% Bond1 Poland Accounts Receivable Facility Q3 FY24 Supplemental Slides June 20, 2024

 
19 45 % 46 % 42 % 37 % 33 % 32 % 24 % 18 % 21 % 22 % 20 % 17 % 18 % 14 % 24 % 17 % 15 % 15 % 13 % 11 % 8% 10 % 9% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% 3. 8x 3. 9x 3. 2x 2. 5x 1. 9x 1. 6x 1. 2x 0. 9x 1. 1x 1. 2x 1. 0x 0. 8x 0. 7x 0. 5x 0. 7x 0. 5x 0. 4x 0. 5x 0. 5x 0. 4x 0. 3x 0. 4x 0. 5x NM 0.5x 1.0x 1.5x 2.0x 2.5x 3.0x 3.5x 4.0x 4.5x Source: Public filings, Internal data Notes: 1. Total debt is defined as long-term debt plus current maturities of long-term debt and short-term borrowings. 2. Net Debt is defined as total debt less cash & cash equivalents. 3. EBITDA depicted is adjusted EBITDA from continuing operations on a trailing 12-month basis. 4. Net debt-to-capitalization is defined as net debt on CMC’s balance sheet divided by the sum of total debt and stockholders’ equity. For a reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures, see the appendix to this document. Leverage Profile Financial strength gives us the flexibility to fund our announced projects, pursue opportunistic M&A, and distribute cash to shareholders Net Debt1,2 / EBITDA3 Net Debt-to-Capitalization4 Transformational rebar asset acquisition Tensar acquisition Construction of Arizona 2 Transformational rebar asset acquisition Tensar acquisition Construction of Arizona 2 Q3 FY24 Supplemental Slides June 20, 2024

 
2% 69% CMCGlobal Industry 1.18 28.60 CMCGlobal Industry 3.84 20.99 CMCGlobal Industry 0.68 1.91 CMCGlobal Industry 59% Of goal Clear Sustainability Leader Q3 FY24 Supplemental Slides │ June 20, 2024 20 [1] Represents progress on environmental goals as of fiscal year 2023, compared to fiscal year 2019 Note: GHG emissions statistics for CMC include only steel mill operations, which represents over 95% of CMC’s emissions footprint Sources: CMC 2023 Sustainability Report; virgin material content for industry based on data from Bureau of International Recycling; all other industry data sourced from the World Steel Association CMC plays a key role in the circular steel economy, turning end of life metals into the steel that forms the backbone of modern society ACCOUNTABILITY FOR OUR ACTIONS RESPECT FOR OUR ENVIRONMENT ACTING WITH INTEGRITY 2.2 1.8 1.0 0.42 Integrated Average Global Average U.S. Average CMC Scopes 1&2 Greenhouse Gas Emissions (GHG) Intensity tC O 2e p er M T of s te el Reduce our combined Scope 1 and 2 GHG emissions intensity by 20% Increase our renewable energy usage by 12% Reduce our energy consumption intensity by 5% Reduce our water withdrawal intensity by 8% 8 3 % Of goal 88% Of goal 0 % Of goal Progress on 2030 Goals (2019 baseline1) Scopes 1-3 GHG Emissions Intensity tC O 2e p er M T of s te el Energy Intensity G J pe r M T of s te el Water Withdrawal Intensity Cu bi c m et er p er M T of s te el Virgin Materials Used in Steelmaking % o f s te el c on te nt

 
© CMC Appendix: Non-GAAP Financial Reconciliations

 
22 Adjusted EBITDA and Core EBITDA – Last 5 Quarters [1] See page 28 for definitions of non-GAAP measures Q3 FY24 Supplemental Slides June 20, 2024

 
23 Adjusted EBITDA, Core EBITDA, and Core EBITDA margins [1] See page 28 for definitions of non-GAAP measures Q3 FY24 Supplemental Slides June 20, 2024

 
24 Adjusted Earnings [1] See page 28 for definitions of non-GAAP measures Q3 FY24 Supplemental Slides June 20, 2024

 
25 Annualized Return on Invested Capital [1] Federal statutory rate of 21% plus approximate impact of state level income tax [2] See page 28 for definitions of non-GAAP measures Q3 FY24 Supplemental Slides June 20, 2024

 
26 [1] See page 28 for definitions of non-GAAP measures Adjusted EBITDA Less Sustaining Capital Expenditures and Disbursements to Stakeholders Q3 FY24 Supplemental Slides June 20, 2024

 
27 Net Debt to Adjusted EBITDA and Net Debt to Capitalization [1] See page 28 for definitions of non-GAAP measures Q3 FY24 Supplemental Slides June 20, 2024

 
28 Definitions for non-GAAP financial measures ADJUSTED EARNINGS Adjusted earnings is a non-GAAP financial measure that is equal to earnings before asset impairments, including the estimated income tax effects thereof. The adjustment settlement for New Markets Tax Credit transaction represents the recognition of deferred revenue from 2016 and 2017 resulting from the Company’s participation in the New Markets Tax Credit program provided for in the Community Renewal Tax Relief Act of 2000 during the development of a micro mill, spooler and T-post shop located in eligible zones as determined by the Internal Revenue Service. Adjusted earnings should not be considered as an alternative to net earnings or any other performance measure derived in accordance with GAAP. However, we believe that adjusted earnings provides relevant and useful information to investors as it allows: (i) a supplemental measure of our ongoing core performance and (ii) the assessment of period-to-period performance trends. Management uses adjusted earnings to evaluate our financial performance. Adjusted earnings may be inconsistent with similar measures presented by other companies. Adjusted earnings per diluted share (or adjusted EPS) is defined as adjusted earnings on a diluted per share basis. CORE EBITDA Core EBITDA is the sum of net earnings before interest expense and income taxes. It also excludes recurring non-cash charges for depreciation and amortization, asset impairments, and amortization of acquired unfavorable contract backlog. Core EBITDA also excludes settlement for New Market Tax Credit transactions, non-cash equity compensation, loss on debt extinguishments, gains on sale of assets, facility closures, acquisition settlements, labor cost government refunds, acquisition and integration related costs, purchase accounting effect on inventory, CMC Steel Oklahoma incentives, and severances. The adjustment settlement for New Markets Tax Credit transaction represents the recognition of deferred revenue from 2016 and 2017 resulting from the Company’s participation in the New Markets Tax Credit program provided for in the Community Renewal Tax Relief Act of 2000 during the development of a micro mill, spooler and T-post shop located in eligible zones as determined by the Internal Revenue Service. Core EBITDA 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 Core EBITDA 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, Core EBITDA is the target benchmark for our annual and long- term cash incentive performance plans for management. Core EBITDA may be inconsistent with similar measures presented by other companies. ADJUSTED EBITDA Adjusted EBITDA is a non-GAAP financial measure. Adjusted EBITDA is the sum of the Company’s net earnings before interest expense, income taxes, depreciation and amortization expense, asset impairments, and amortization of acquired unfavorable contract backlog. Adjusted EBITDA should not be considered as an alternative to net earnings, or any other performance measure derived in accordance with GAAP. However, we believe that adjusted EBITDA provides relevant and useful information to investors as it allows: (i) a supplemental measure of our ongoing performance and (ii) the assessment of period-to-period performance trends. Management uses adjusted EBITDA to evaluate our financial performance. Adjusted EBITDA may be inconsistent with similar measures presented by other companies. ADJUSTED EBITDA LESS SUSTAINING CAPITAL EXPENDITURES AND DISBURSEMENTS TO STAKEHOLDERS Adjusted EBITDA less sustaining capital expenditures and disbursements to shareholders is defined as Adjusted EBITDA less depreciation and amortization (used as a proxy for sustaining capital expenditures) less interest expense, less cash income taxes less dividend payments plus stock-based compensation. NET DEBT Net debt is defined as total debt less cash and cash equivalents. RETURN ON INVESTED CAPITAL Return on Invested Capital is defined as: 1) after-tax operating profit divided by 2) total assets less cash & cash equivalents less non-interest-bearing liabilities. For annual measures, trailing 5-quarter averages are used for balance sheet figures. In prior periods, the Company included within the definition of core EBITDA, core EBITDA margin, adjusted earnings and adjusted earnings per diluted share an adjustment for “Mill operational commissioning costs” related to the Company's third micro mill, which was placed into service during the fourth quarter of fiscal 2023. Periods commencing subsequent to February 29, 2024 no longer include an adjustment for mill operational commissioning costs. Accordingly, the Company has recast core EBITDA, core EBITDA margin, adjusted earnings and adjusted earnings per diluted share for all prior periods to conform to this presentation. Q3 FY24 Supplemental Slides June 20, 2024

 
CMC.COM

 
v3.24.1.1.u2
Cover
Jun. 20, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Jun. 20, 2024
Entity Registrant Name Commercial Metals Company
Entity Incorporation, State or Country Code DE
Entity File Number 1-4304
Entity Tax Identification Number 75-0725338
Entity Address, Address Line One 6565 N. MacArthur Blvd.
Entity Address, City or Town Irving
Entity Address, State or Province TX
Entity Address, Postal Zip Code 75039
City Area Code 214
Local Phone Number 689-4300
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, $0.01 par value
Trading Symbol CMC
Security Exchange Name NYSE
Entity Emerging Growth Company false
Entity Central Index Key 0000022444
Amendment Flag false
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