Worthington Enterprises Reports Second Quarter Fiscal 2025 Results
Worthington Enterprises (NYSE: WOR) reported fiscal Q2 2025 results with net sales of $274.0 million, down 8% year-over-year due to SES segment deconsolidation. Despite lower sales, the company achieved improved profitability with adjusted EPS from continuing operations up 5% to $0.60 and adjusted EBITDA increasing 2% to $56.2 million.
The Consumer Products segment saw net sales decrease 2.2% to $116.7 million, while adjusted EBITDA improved due to higher volumes and better margins. The Building Products segment's net sales grew 4% to $157.3 million, driven by Ragasco acquisition. The company maintained strong liquidity with $193.8 million in cash and repurchased 200,000 shares for $8.1 million during the quarter.
Worthington Enterprises (NYSE: WOR) ha riportato i risultati del secondo trimestre fiscale 2025 con vendite nette di 274,0 milioni di dollari, in calo dell'8% anno su anno a causa della deconsolidazione del segmento SES. Nonostante le vendite inferiori, l'azienda ha raggiunto una maggiore redditività con un utile per azione rettificato dalle operazioni continuative in aumento del 5% a 0,60 dollari e un EBITDA rettificato in crescita del 2% a 56,2 milioni di dollari.
Il segmento Prodotti di Consumo ha registrato una diminuzione delle vendite nette del 2,2% a 116,7 milioni di dollari, mentre l'EBITDA rettificato è migliorato grazie a volumi più alti e margini migliori. Le vendite nette del segmento Prodotti per l'Edilizia sono cresciute del 4% a 157,3 milioni di dollari, spinte dall'acquisizione di Ragasco. L'azienda ha mantenuto una forte liquidità con 193,8 milioni di dollari in contanti e ha riacquistato 200.000 azioni per 8,1 milioni di dollari durante il trimestre.
Worthington Enterprises (NYSE: WOR) informó los resultados del segundo trimestre fiscal 2025 con ventas netas de 274,0 millones de dólares, una caída del 8% interanual debido a la deconsolidación del segmento SES. A pesar de la disminución de las ventas, la compañía logró mejorar su rentabilidad con una utilidad por acción ajustada de las operaciones continuas que aumentó un 5% a 0,60 dólares y un EBITDA ajustado que creció un 2% a 56,2 millones de dólares.
El segmento de Productos de Consumo vio una disminución en las ventas netas del 2,2% a 116,7 millones de dólares, mientras que el EBITDA ajustado mejoró gracias a un mayor volumen y mejores márgenes. Las ventas netas del segmento de Productos para Construcción crecieron un 4% a 157,3 millones de dólares, impulsadas por la adquisición de Ragasco. La compañía mantuvo una sólida liquidez con 193,8 millones de dólares en efectivo y recompró 200,000 acciones por 8,1 millones de dólares durante el trimestre.
워딩턴 엔터프라이즈 (NYSE: WOR)는 2025 회계 연도 2분기 결과를 보고하며 순매출이 2억 7400만 달러로 전년 대비 8% 감소했다고 발표했습니다. 이는 SES 부문의 연결 해제 때문입니다. 판매는 감소했지만, 회사는 지속 운영에서 조정된 주당순이익(EPS)이 5% 증가한 0.60달러와 조정된 EBITDA가 2% 증가한 5620만 달러로 개선된 수익성을 달성했습니다.
소비재 부문은 순매출이 2.2% 감소하여 1억 1670만 달러를 기록했으며, 조정된 EBITDA는 더 높은 물량과 개선된 마진 덕분에 증가했습니다. 건축 제품 부문의 순매출은 Ragasco 인수에 힘입어 4% 증가하여 1억 5730만 달러에 달했습니다. 회사는 현금이 1억 9380만 달러로 강력한 유동성을 유지했으며, 분기 동안 8.1백만 달러에 20만 주를 재매입했습니다.
Worthington Enterprises (NYSE: WOR) a annoncé les résultats du deuxième trimestre fiscal 2025 avec un chiffre d'affaires net de 274,0 millions de dollars, en baisse de 8 % par rapport à l'année précédente en raison de la déconstitution du segment SES. Malgré la baisse des ventes, la société a réalisé une rentabilité améliorée avec un bénéfice par action ajusté des opérations continuées en hausse de 5 % à 0,60 $ et un EBITDA ajusté en hausse de 2 % à 56,2 millions de dollars.
Le segment Produits de Consommation a vu ses ventes nettes diminuer de 2,2 % pour atteindre 116,7 millions de dollars, tandis que l'EBITDA ajusté s'est amélioré grâce à des volumes plus élevés et à de meilleures marges. Les ventes nettes du segment Produits de Construction ont augmenté de 4 % pour atteindre 157,3 millions de dollars, soutenues par l'acquisition de Ragasco. L'entreprise a maintenu une solide liquidité avec 193,8 millions de dollars en liquidités et a racheté 200 000 actions pour 8,1 millions de dollars au cours du trimestre.
Worthington Enterprises (NYSE: WOR) hat die Ergebnisse für das zweite fiskalische Quartal 2025 veröffentlicht, mit Nettoverkäufen von 274,0 Millionen Dollar, was einem Rückgang von 8% im Vergleich zum Vorjahr aufgrund der Dezentralisierung des SES-Segments entspricht. Trotz rückläufiger Verkaufszahlen konnte das Unternehmen die Rentabilität steigern, mit einem angepassten Gewinn pro Aktie aus fortgeführten Betrieben, der um 5% auf 0,60 Dollar stieg, und einem angepassten EBITDA, das um 2% auf 56,2 Millionen Dollar anstieg.
Das Segment Konsumgüter verzeichnete einen Rückgang der Nettoverkäufe um 2,2% auf 116,7 Millionen Dollar, während das angepasste EBITDA aufgrund höherer Volumen und besserer Margen anstieg. Die Nettoverkäufe des Segments Bauprodukte stiegen um 4% auf 157,3 Millionen Dollar, was durch die Übernahme von Ragasco vorangetrieben wurde. Das Unternehmen hielt eine starke Liquidität mit 193,8 Millionen Dollar in bar und hat im Quartal 200.000 Aktien für 8,1 Millionen Dollar zurückgekauft.
- Adjusted EPS increased 5% to $0.60
- Adjusted EBITDA grew 2% to $56.2 million
- Building Products segment sales increased 4% to $157.3 million
- Operating income improved to $3.5 million from -$14.4 million YoY
- Generated operating cash flow of $49.1 million
- Maintained strong liquidity with $500 million available credit facility
- Net sales declined 8% to $274.0 million
- Consumer Products segment sales decreased 2.2%
- Equity income decreased $4.1 million YoY
- ClarkDietrich contribution decreased $4.0 million YoY
- Cash position decreased $50.4 million from May 31, 2024
Insights
COLUMBUS, Ohio, Dec. 17, 2024 (GLOBE NEWSWIRE) -- Worthington Enterprises, Inc. (NYSE: WOR), a market-leading designer and manufacturer of innovative products and solutions that serve customers in the building products and consumer products end markets, today reported results for its fiscal 2025 second quarter ended November 30, 2024.
Second Quarter Highlights (all comparisons to the second quarter of fiscal 2024):
- Net sales of
$274.0 million , decreased8% driven by the deconsolidation of the former Sustainable Energy Solutions segment (“SES”) - Adjusted EPS of
$0.60 from continuing operations (diluted), up5% and adjusted EBITDA of$56.2 million , up2% , despite lower net sales - Repurchased 200,000 shares of common stock for
$8.1 million leaving 5,715,000 shares remaining on the Company’s share repurchase authorization - Declared a quarterly dividend of
$0.17 per share payable on March 28, 2025, to shareholders of record at the close of business on March 14, 2025
Financial highlights, on a continuing operations basis, for the current year and prior year quarters are as follows:
| (U.S. dollars in millions, except per share amounts) | 2Q 2025 | 2Q 2024 | ||||||||||
| Net sales | $ | 274.0 | $ | 298.2 | ||||||||
| Operating income (loss) | 3.5 | (14.4 | ) | |||||||||
| Earnings before income taxes | 37.1 | 24.5 | ||||||||||
| Net earnings from continuing operations | 28.3 | 17.9 | ||||||||||
| Earnings per share (“EPS”) from continuing operations - diluted | 0.56 | 0.36 | ||||||||||
| Additional Non-GAAP Financial Measures (1) | ||||||||||||
| Adjusted operating income | $ | 6.1 | $ | 2.4 | ||||||||
| Adjusted EBITDA from continuing operations | 56.2 | 55.0 | ||||||||||
| Adjusted EPS from continuing operations - diluted | 0.60 | 0.57 | ||||||||||
| ____________________ | |
| (1) | Refer to the “Use of Non-GAAP Financial Measures and Definitions” for additional information regarding our use of non-GAAP measures, including reconciliation to the most comparable GAAP measures. |
“We delivered solid financial results for the quarter despite mild but persistent macro headwinds, achieving year over year and sequential growth in adjusted EBITDA and adjusted EPS,” said Worthington Enterprises President and CEO Joe Hayek. “Consumer Products’ earnings growth was driven by increased volumes and improved gross margins. Building Products generated higher earnings driven by the inclusion of Ragasco and stronger contributions from WAVE."
Consolidated Quarterly Results
Net sales for the second quarter of fiscal 2025 were
Operating income of
Equity income decreased
Income tax expense was
Balance Sheet and Cash Flow
The Company ended the quarter with cash of
Total debt at quarter end consisted entirely of long-term debt and was relatively unchanged from May 31, 2024, at
Quarterly Segment Results
Consumer Products generated net sales of
Building Products generated net sales of
Outlook
“Our team continues to navigate the current environment effectively, maintaining a strong focus on delivering value-added solutions and products for our customers,” Hayek said. “While we are pleased with our performance, we continue to set our sights higher. We have improved our value propositions in multiple product lines over the last year, and we are very well positioned as growth returns to our end markets. Led by our people-first, performance-based culture, leveraging a solid balance sheet and a commitment to transformation, innovation and M&A, we are confident in our ability to optimize our business, drive sustainable growth and deliver long-term value to our shareholders.”
Conference Call
The Company will review fiscal 2025 second quarter results during its quarterly conference call on December 18, 2024, at 8:30 a.m. Eastern Time. Details regarding the conference call can be found on the Company website at www.WorthingtonEnterprises.com.
About Worthington Enterprises
Worthington Enterprises (NYSE: WOR) is a designer and manufacturer of market-leading brands that help enable people to live safer, healthier and more expressive lives. The Company operates with two primary business segments: Building Products and Consumer Products. The Building Products segment includes cooking, heating, cooling and water solutions, architectural and acoustical grid ceilings and metal framing and accessories. The Consumer Products segment provides solutions for the tools, outdoor living and celebrations categories. Product brands within the Worthington Enterprises portfolio include Balloon Time®, Bernzomatic®, Coleman® (propane cylinders), CoMet®, Garden Weasel®, General®, HALO™, Hawkeye™, Level5 Tools®, Mag Torch®, NEXI™, Pactool International®, PowerCore™, Ragasco®, Well-X-Trol® and XLite™, among others. The Company also serves the growing global hydrogen ecosystem via a joint venture focused on on-board fueling systems and gas containment solutions.
Headquartered in Columbus, Ohio, Worthington Enterprises and its joint ventures employ approximately 6,000 people throughout North America and Europe.
Founded in 1955 as Worthington Industries, Worthington Enterprises follows a people-first Philosophy with earning money for its shareholders as its first corporate goal. Worthington Enterprises achieves this outcome by empowering its employees to innovate, thrive and grow with leading brands in attractive markets that improve everyday life. The Company engages deeply with local communities where it has operations through volunteer efforts and The Worthington Companies Foundation, participates actively in workforce development programs and reports annually on its corporate citizenship and sustainability efforts. For more information, visit worthingtonenterprises.com.
Safe Harbor Statement
Selected statements contained in this release constitute “forward-looking statements,” as that term is used in the Private Securities Litigation Reform Act of 1995 (the “Act”). The Company wishes to take advantage of the safe harbor provisions included in the Act. Forward-looking statements reflect the Company’s current expectations, estimates or projections concerning future results or events. These statements are often identified by the use of forward-looking words or phrases such as “believe,” “expect,” “anticipate,” “may,” “could,” “should,” “would,” “intend,” “plan,” “will,” “likely,” “estimate,” “project,” “position,” “strategy,” “target,” “aim,” “seek,” “foresee” and similar words or phrases. These forward-looking statements include, without limitation, statements relating to: future or expected cash positions, liquidity and ability to access financial markets and capital; outlook, strategy or business plans; the anticipated benefits of the separation of the Company’s Steel Processing business (the “Separation); the expected financial and operational performance of, and future opportunities for, the Company following the Separation; the Company’s performance on a pro forma basis to illustrate the estimated effects of the Separation on historical periods; the tax treatment of the Separation transaction; future or expected growth, growth potential, forward momentum, performance, competitive position, sales, volumes, cash flows, earnings, margins, balance sheet strengths, debt, financial condition or other financial measures; pricing trends for raw materials and finished goods and the impact of pricing changes; the ability to improve or maintain margins; expected demand or demand trends for the Company or its markets; additions to product lines and opportunities to participate in new markets; expected benefits from transformation and innovation efforts; the ability to improve performance and competitive position at the Company’s operations; anticipated working capital needs, capital expenditures and asset sales; anticipated improvements and efficiencies in costs, operations, sales, inventory management, sourcing and the supply chain and the results thereof; projected profitability potential; the ability to make acquisitions and the projected timing, results, benefits, costs, charges and expenditures related to acquisitions, joint ventures, headcount reductions and facility dispositions, shutdowns and consolidations; projected capacity and the alignment of operations with demand; the ability to operate profitably and generate cash in down markets; the ability to capture and maintain market share and to develop or take advantage of future opportunities, customer initiatives, new businesses, new products and new markets; expectations for Company and customer inventories, jobs and orders; expectations for the economy and markets or improvements therein; expectations for generating improving and sustainable earnings, earnings potential, margins or shareholder value; effects of judicial rulings; the ever-changing effects of the novel coronavirus (“COVID-19”) pandemic and the various responses of governmental and nongovernmental authorities thereto on economies and markets, and on our customers, counterparties, employees and third-party service providers; and other non-historical matters.
Because they are based on beliefs, estimates and assumptions, forward-looking statements are inherently subject to risks and uncertainties that could cause actual results to differ materially from those projected. Any number of factors could affect actual results, including, without limitation, those that follow: the uncertainty of obtaining regulatory approvals in connection with the Separation, including rulings from the Internal Revenue Service; the Company’s ability to successfully realize the anticipated benefits of the Separation; the risks, uncertainties and impacts related to the COVID-19 pandemic – the duration, extent and severity of which are impossible to predict, including the possibility of future resurgence in the spread of COVID-19 or variants thereof – and the availability, effectiveness and acceptance of vaccines, and other actual or potential public health emergencies and actions taken by governmental authorities or others in connection therewith; the effect of national, regional and global economic conditions generally and within major product markets, including significant economic disruptions from COVID-19, the actions taken in connection therewith and the implementation of related fiscal stimulus packages; the effect of conditions in national and worldwide financial markets, including inflation, increases in interest rates and economic recession, and with respect to the ability of financial institutions to provide capital; the impact of tariffs, the adoption of trade restrictions affecting the Company’s products or suppliers, a United States withdrawal from or significant renegotiation of trade agreements, the occurrence of trade wars, the closing of border crossings, and other changes in trade regulations or relationships; changing oil prices and/or supply; product demand and pricing; changes in product mix, product substitution and market acceptance of the Company’s products; volatility or fluctuations in the pricing, quality or availability of raw materials (particularly steel), supplies, transportation, utilities, labor and other items required by operations (especially in light of the COVID-19 pandemic and Russia’s invasion of Ukraine); effects of sourcing and supply chain constraints; the outcome of adverse claims experience with respect to workers’ compensation, product recalls or product liability, casualty events or other matters; effects of facility closures and the consolidation of operations; the effect of financial difficulties, consolidation and other changes within the steel, automotive, construction and other industries in which the Company participates; failure to maintain appropriate levels of inventories; financial difficulties (including bankruptcy filings) of original equipment manufacturers, end-users and customers, suppliers, joint venture partners and others with whom the Company does business; the ability to realize targeted expense reductions from headcount reductions, facility closures and other cost reduction efforts; the ability to realize cost savings and operational, sales and sourcing improvements and efficiencies, and other expected benefits from transformation initiatives, on a timely basis; the overall success of, and the ability to integrate, newly-acquired businesses and joint ventures, maintain and develop their customers, and achieve synergies and other expected benefits and cost savings therefrom; capacity levels and efficiencies, within facilities, within major product markets and within the industries in which the Company participates as a whole; the effect of disruption in the business of suppliers, customers, facilities and shipping operations due to adverse weather, casualty events, equipment breakdowns, labor shortages, interruption in utility services, civil unrest, international conflicts (especially in light of Russia’s invasion of Ukraine), terrorist activities or other causes; changes in customer demand, inventories, spending patterns, product choices, and supplier choices; risks associated with doing business internationally, including economic, political and social instability (especially in light of Russia’s invasion of Ukraine), foreign currency exchange rate exposure and the acceptance of the Company’s products in global markets; the ability to improve and maintain processes and business practices to keep pace with the economic, competitive and technological environment; the effect of inflation, interest rate increases and economic recession, which may negatively impact the Company’s operations and financial results; deviation of actual results from estimates and/or assumptions used by the Company in the application of its significant accounting policies; the level of imports and import prices in the Company’s markets; the impact of environmental laws and regulations or the actions of the United States Environmental Protection Agency or similar regulators which increase costs or limit the Company’s ability to use or sell certain products; the impact of increasing environmental, greenhouse gas emission and sustainability regulations and considerations; the impact of judicial rulings and governmental regulations, both in the United States and abroad, including those adopted by the United States Securities and Exchange Commission and other governmental agencies as contemplated by the Coronavirus Aid, Relief and Economic Security (CARES) Act, the Consolidated Appropriations Act, 2021, the American Rescue Plan Act of 2021, and the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010; the effect of healthcare laws in the United States and potential changes for such laws, especially in light of the COVID-19 pandemic, which may increase the Company’s healthcare and other costs and negatively impact the Company’s operations and financial results; the effects of tax laws in the United States and potential changes for such laws, which may increase the Company’s costs and negatively impact the Company’s operations and financial results; cyber security risks; the effects of privacy and information security laws and standards; and other risks described from time to time in the Company’s filings with the United States Securities and Exchange Commission, including those described in “Part I – Item 1A. – Risk Factors” of the Company’s Annual Report on Form 10-K for the fiscal year ended May 31, 2024.
Forward-looking statements should be construed in the light of such risks. The Company notes these factors for investors as contemplated by the Act. It is impossible to predict or identify all potential risk factors. Consequently, readers should not consider the foregoing list to be a complete set of all potential risks and uncertainties. Readers are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date made. The Company does not undertake, and hereby disclaims, any obligation to update any forward-looking statements, whether as a result of new information, future developments or otherwise, except as required by applicable law.
| WORTHINGTON ENTERPRISES, INC. CONSOLIDATED STATEMENTS OF EARNINGS (In thousands, except per share amounts) | ||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||
| November 30, | November 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Net sales | $ | 274,046 | $ | 298,229 | $ | 531,354 | $ | 610,147 | ||||||||
| Cost of goods sold | 199,987 | 234,951 | 394,800 | 477,239 | ||||||||||||
| Gross profit | 74,059 | 63,278 | 136,554 | 132,908 | ||||||||||||
| Selling, general and administrative expense | 67,918 | 70,583 | 133,954 | 145,128 | ||||||||||||
| Restructuring and other expense, net | 2,620 | 6 | 3,778 | 6 | ||||||||||||
| Separation costs | - | 7,056 | - | 9,466 | ||||||||||||
| Operating income (loss) | 3,521 | (14,367 | ) | (1,178 | ) | (21,692 | ) | |||||||||
| Other income (expense): | ||||||||||||||||
| Miscellaneous income, net | 65 | 714 | 551 | 1,013 | ||||||||||||
| Loss on extinguishment of debt | - | - | - | (1,534 | ) | |||||||||||
| Interest expense, net | (1,033 | ) | (472 | ) | (1,522 | ) | (1,546 | ) | ||||||||
| Equity in net income of unconsolidated affiliates | 34,556 | 38,668 | 70,048 | 84,092 | ||||||||||||
| Earnings before income taxes | 37,109 | 24,543 | 67,899 | 60,333 | ||||||||||||
| Income tax expense | 9,100 | 6,609 | 15,882 | 15,569 | ||||||||||||
| Net earnings from continuing operations | 28,009 | 17,934 | 52,017 | 44,764 | ||||||||||||
| Net earnings from discontinued operations | - | 10,233 | - | 83,106 | ||||||||||||
| Net earnings | 28,009 | 28,167 | 52,017 | 127,870 | ||||||||||||
| Net earnings (loss) attributable to noncontrolling interests | (251 | ) | 3,865 | (496 | ) | 7,461 | ||||||||||
| Net earnings attributable to controlling interest | $ | 28,260 | $ | 24,302 | $ | 52,513 | $ | 120,409 | ||||||||
| Amounts attributable to controlling interest: | ||||||||||||||||
| Net earnings from continuing operations | $ | 28,260 | $ | 17,934 | $ | 52,513 | $ | 44,764 | ||||||||
| Net earnings from discontinued operations | - | 6,368 | - | 75,645 | ||||||||||||
| Net earnings attributable to controlling interest | $ | 28,260 | $ | 24,302 | $ | 52,513 | $ | 120,409 | ||||||||
| Earnings per share from continuing operations - basic | $ | 0.57 | $ | 0.36 | $ | 1.06 | $ | 0.91 | ||||||||
| Earnings per share from discontinued operations - basic | - | 0.13 | - | 1.55 | ||||||||||||
| Net earnings per share attributable to controlling interest - basic | $ | 0.57 | $ | 0.49 | $ | 1.06 | $ | 2.46 | ||||||||
| Earnings per share from continuing operations - diluted | $ | 0.56 | $ | 0.36 | $ | 1.04 | $ | 0.89 | ||||||||
| Earnings per share from discontinued operations - diluted | - | 0.13 | - | 1.51 | ||||||||||||
| Net earnings per share attributable to controlling interest - diluted | $ | 0.56 | $ | 0.49 | $ | 1.04 | $ | 2.40 | ||||||||
| Weighted average common shares outstanding - basic | 49,464 | 49,186 | 49,475 | 49,013 | ||||||||||||
| Weighted average common shares outstanding - diluted | 50,138 | 50,042 | 50,264 | 50,102 | ||||||||||||
| Cash dividends declared per share | $ | 0.17 | $ | 0.32 | $ | 0.34 | $ | 0.64 | ||||||||
| CONSOLIDATED BALANCE SHEETS WORTHINGTON ENTERPRISES, INC. (In thousands) | ||||||||
| November 30, | May 31, | |||||||
| 2024 | 2024 | |||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 193,805 | $ | 244,225 | ||||
| Receivables, less allowances of | 184,925 | 199,798 | ||||||
| Inventories | ||||||||
| Raw materials | 74,921 | 66,040 | ||||||
| Work in process | 10,577 | 11,668 | ||||||
| Finished products | 93,965 | 86,907 | ||||||
| Total inventories | 179,463 | 164,615 | ||||||
| Income taxes receivable | 9,417 | 17,319 | ||||||
| Prepaid expenses and other current assets | 35,389 | 47,936 | ||||||
| Total current assets | 602,999 | 673,893 | ||||||
| Investment in unconsolidated affiliates | 135,218 | 144,863 | ||||||
| Operating lease assets | 23,015 | 18,667 | ||||||
| Goodwill | 369,799 | 331,595 | ||||||
| Other intangibles, net of accumulated amortization of | 244,102 | 221,071 | ||||||
| Other assets | 22,309 | 21,342 | ||||||
| Property, plant and equipment: | ||||||||
| Land | 8,632 | 8,657 | ||||||
| Buildings and improvements | 129,684 | 123,478 | ||||||
| Machinery and equipment | 356,678 | 321,836 | ||||||
| Construction in progress | 27,330 | 24,504 | ||||||
| Total property, plant and equipment | 522,324 | 478,475 | ||||||
| Less: accumulated depreciation | 262,749 | 251,269 | ||||||
| Total property, plant and equipment, net | 259,575 | 227,206 | ||||||
| Total assets | $ | 1,657,017 | $ | 1,638,637 | ||||
| Liabilities and equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 83,262 | $ | 91,605 | ||||
| Accrued compensation, contributions to employee benefit plans and related taxes | 28,499 | 41,974 | ||||||
| Dividends payable | 9,040 | 9,038 | ||||||
| Other accrued items | 42,357 | 29,061 | ||||||
| Current operating lease liabilities | 5,396 | 6,228 | ||||||
| Income taxes payable | 910 | 470 | ||||||
| Total current liabilities | 169,464 | 178,376 | ||||||
| Other liabilities | 60,305 | 62,243 | ||||||
| Distributions in excess of investment in unconsolidated affiliate | 110,763 | 111,905 | ||||||
| Long-term debt | 295,721 | 298,133 | ||||||
| Noncurrent operating lease liabilities | 18,090 | 12,818 | ||||||
| Deferred income taxes | 89,716 | 84,150 | ||||||
| Total liabilities | 744,059 | 747,625 | ||||||
| Shareholders' equity - controlling interest | 911,321 | 888,879 | ||||||
| Noncontrolling interests | 1,637 | 2,133 | ||||||
| Total equity | 912,958 | 891,012 | ||||||
| Total liabilities and equity | $ | 1,657,017 | $ | 1,638,637 | ||||
| WORTHINGTON ENTERPRISES, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) | ||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||
| November 30, | November 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Operating activities: | ||||||||||||||||
| Net earnings | $ | 28,009 | $ | 28,167 | $ | 52,017 | $ | 127,870 | ||||||||
| Adjustments to reconcile net earnings to net cash provided by operating activities: | ||||||||||||||||
| Depreciation and amortization | 11,927 | 28,007 | 23,757 | 56,332 | ||||||||||||
| Impairment of long-lived assets | - | - | - | 1,401 | ||||||||||||
| Provision for (benefit from) deferred income taxes | 2,682 | 1,968 | (2,855 | ) | (3,485 | ) | ||||||||||
| Loss on extinguishment of debt | - | - | - | 1,534 | ||||||||||||
| Bad debt expense (income) | 2,069 | 345 | 2,061 | (454 | ) | |||||||||||
| Equity in net income of unconsolidated affiliates, net of distributions | 4,268 | (4,129 | ) | 7,721 | 6,096 | |||||||||||
| Net gain on sale of assets | (508 | ) | (439 | ) | (526 | ) | (334 | ) | ||||||||
| Stock-based compensation | 5,937 | 6,175 | 9,862 | 10,691 | ||||||||||||
| Changes in assets and liabilities, net of impact of acquisitions: | ||||||||||||||||
| Receivables | (18,636 | ) | 76,704 | 9,530 | 67,861 | |||||||||||
| Inventories | 7,836 | 103,150 | 1,430 | 38,823 | ||||||||||||
| Accounts payable | 447 | (75,373 | ) | (12,646 | ) | (75,095 | ) | |||||||||
| Accrued compensation and employee benefits | (2,021 | ) | 2,794 | (13,466 | ) | (9,220 | ) | |||||||||
| Other operating items, net | 7,043 | (32,379 | ) | 13,314 | (27,334 | ) | ||||||||||
| Net cash provided by operating activities | 49,053 | 134,990 | 90,199 | 194,686 | ||||||||||||
| Investing activities: | ||||||||||||||||
| Investment in property, plant and equipment | (15,161 | ) | (32,876 | ) | (24,790 | ) | (62,174 | ) | ||||||||
| Acquisitions, net of cash acquired | 731 | (21,013 | ) | (88,156 | ) | (21,013 | ) | |||||||||
| Proceeds from sale of assets, net of selling costs | 1,616 | 751 | 13,385 | 802 | ||||||||||||
| Investment in non-marketable equity securities | (40 | ) | (1,500 | ) | (2,040 | ) | (1,540 | ) | ||||||||
| Investment in note receivable | - | - | - | (15,000 | ) | |||||||||||
| Distribution from unconsolidated affiliate | - | 1,085 | - | 1,085 | ||||||||||||
| Net cash used by investing activities | (12,854 | ) | (53,553 | ) | (101,601 | ) | (97,840 | ) | ||||||||
| Financing activities: | ||||||||||||||||
| Dividends paid | (8,969 | ) | (17,333 | ) | (17,085 | ) | (33,058 | ) | ||||||||
| Repurchase of common shares | (8,079 | ) | - | (14,882 | ) | - | ||||||||||
| Proceeds from issuance of common shares, net of tax withholdings | (3,893 | ) | (9,207 | ) | (7,051 | ) | (14,337 | ) | ||||||||
| Net proceeds from short-term borrowings (1) | - | 175,000 | - | 172,187 | ||||||||||||
| Principal payments on long-term obligations | - | - | - | (243,757 | ) | |||||||||||
| Payments to noncontrolling interests | - | - | - | (1,921 | ) | |||||||||||
| Net cash provided (used) by financing activities | (20,941 | ) | 148,460 | (39,018 | ) | (120,886 | ) | |||||||||
| Increase (decrease) in cash and cash equivalents | 15,258 | 229,897 | (50,420 | ) | (24,040 | ) | ||||||||||
| Cash and cash equivalents at beginning of period | 178,547 | 201,009 | 244,225 | 454,946 | ||||||||||||
| Cash and cash equivalents at end of period (2) | $ | 193,805 | $ | 430,906 | $ | 193,805 | $ | 430,906 | ||||||||
| ____________________ | |
| (1) | Net proceeds in fiscal 2024 consisted of borrowings under Worthington Steel’s short-term credit facilities assumed by Worthington Steel in conjunction with the Separation. |
| (2) | The cash flows related to discontinued operations have not been segregated in the periods presented herein. Accordingly, the consolidated statements of cash flows include the results from continuing and discontinued operations. |
WORTHINGTON ENTERPRISES, INC.
NON-GAAP FINANCIAL MEASURES
(In thousands, except units and per share amounts
The following provides a reconciliation of non-GAAP financial measures, including adjusted operating income, adjusted earnings before income taxes, adjusted income tax expense (benefit), adjusted net earnings from continuing operations attributable to controlling interest, and adjusted earnings per diluted share from continuing operations attributable to controlling interest, from their most comparable GAAP measure for the three and six months ended November 30, 2024 and 2023. Refer to the Use of Non-GAAP Financial Measures and Definitions section herein and non-GAAP footnotes below for further information on these measures.
| Three Months Ended November 30, 2024 | |||||||||||||||||||
| Earnings | Income | Net Earnings | Diluted | ||||||||||||||||
| Before | Tax | from | EPS - | ||||||||||||||||
| Operating | Income | Expense | Continuing | Continuing | |||||||||||||||
| Income | Taxes | (Benefit) | Operations (1) | Operations | |||||||||||||||
| GAAP | $ | 3,521 | $ | 37,109 | $ | 9,100 | $ | 28,260 | 0.56 | ||||||||||
| Restructuring and other expense, net | 2,620 | 2,620 | (639 | ) | 1,981 | 0.04 | |||||||||||||
| Non-GAAP | $ | 6,141 | $ | 39,729 | $ | 9,739 | $ | 30,241 | $ | 0.60 | |||||||||
| Three Months Ended November 30, 2023 | |||||||||||||||||||
| Earnings | Income | Net Earnings | Diluted | ||||||||||||||||
| Operating | Before | Tax | from | EPS - | |||||||||||||||
| Income | Income | Expense | Continuing | Continuing | |||||||||||||||
| (Loss) | Taxes | (Benefit) | Operations (1) | Operations | |||||||||||||||
| GAAP | $ | (14,367 | ) | $ | 24,543 | $ | 6,609 | $ | 17,934 | $ | 0.36 | ||||||||
| Corporate costs eliminated at Separation | 9,671 | 9,671 | (2,344 | ) | 7,327 | 0.14 | |||||||||||||
| Restructuring and other expense, net | 6 | 6 | (1 | ) | 5 | - | |||||||||||||
| Separation costs | 7,056 | 7,056 | (1,690 | ) | 5,366 | 0.11 | |||||||||||||
| Gain on sale of assets in equity income | - | (2,780 | ) | 662 | (2,118 | ) | (0.04 | ) | |||||||||||
| Non-GAAP | $ | 2,366 | $ | 38,496 | $ | 9,982 | $ | 28,514 | $ | 0.57 | |||||||||
| Six Months Ended November 30, 2024 | |||||||||||||||||||
| Earnings | Income | Net Earnings | |||||||||||||||||
| Operating | Before | Tax | from | Diluted EPS - | |||||||||||||||
| Income | Income | Expense | Continuing | Continuing | |||||||||||||||
| (Loss) | Taxes | (Benefit) | Operations (1) | Operations | |||||||||||||||
| GAAP | $ | (1,178 | ) | $ | 67,899 | $ | 15,882 | $ | 52,513 | $ | 1.04 | ||||||||
| Restructuring and other expense, net | 3,778 | 3,778 | (928 | ) | 2,850 | 0.06 | |||||||||||||
| Non-GAAP | $ | 2,600 | $ | 71,677 | $ | 16,810 | $ | 55,363 | $ | 1.10 | |||||||||
| Six Months Ended November 30, 2023 | |||||||||||||||||||
| Operating Income (Loss) | Earnings Before Income Taxes | Income Tax Expense (Benefit) | Net Earnings from Continuing Operations (1) | Diluted EPS - Continuing Operations | |||||||||||||||
| GAAP | $ | (21,692 | ) | $ | 60,333 | $ | 15,569 | $ | 44,764 | 0.89 | |||||||||
| Corporate costs eliminated at Separation | 19,343 | 19,343 | (4,609 | ) | 14,734 | 0.29 | |||||||||||||
| Restructuring and other expense, net | 6 | 6 | (1 | ) | 5 | - | |||||||||||||
| Separation costs | 9,466 | 9,466 | (2,256 | ) | 7,210 | 0.15 | |||||||||||||
| Loss on extinguishment of debt | - | 1,534 | (366 | ) | 1,168 | 0.02 | |||||||||||||
| Gain on sale of assets in equity income | - | (2,780 | ) | 662 | (2,118 | ) | (0.04 | ) | |||||||||||
| Non-GAAP | $ | 7,123 | $ | 87,902 | $ | 22,139 | $ | 65,763 | $ | 1.31 | |||||||||
| ____________________ | |
| (1) | Excludes the impact of noncontrolling interest |
To further assist in the analysis of segment results for the three and six months ended November 30, 2024 and 2023 the following supplemental information has been provided. Reconciliations of adjusted EBITDA from continuing operations and adjusted EBITDA margin from continuing operations to the most comparable GAAP measures are provided below.
| Three Months Ended | Six Months Ended | |||||||||||||||
| November 30, | November 30, | |||||||||||||||
| (in thousands) | 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Volume | ||||||||||||||||
| Consumer Products | 16,420 | 15,931 | 32,591 | 31,963 | ||||||||||||
| Building Products | 3,329 | 3,347 | 6,423 | 7,156 | ||||||||||||
| Total reportable segments | 19,749 | 19,278 | 39,014 | 39,119 | ||||||||||||
| Other | - | 114 | - | 220 | ||||||||||||
| Consolidated | 19,749 | 19,392 | 39,014 | 39,339 | ||||||||||||
| Net sales | ||||||||||||||||
| Consumer Products | $ | 116,748 | $ | 119,389 | $ | 234,343 | $ | 236,742 | ||||||||
| Building Products | 157,298 | 151,303 | 297,011 | 317,231 | ||||||||||||
| Total reportable segments | 274,046 | 270,692 | 531,354 | 553,973 | ||||||||||||
| Other | - | 27,537 | - | 56,174 | ||||||||||||
| Consolidated | $ | 274,046 | $ | 298,229 | $ | 531,354 | $ | 610,147 | ||||||||
| Adjusted EBITDA from continuing operations | ||||||||||||||||
| Consumer Products | $ | 15,484 | $ | 12,674 | $ | 33,259 | $ | 26,889 | ||||||||
| Building Products | 47,185 | 45,809 | 86,914 | 105,442 | ||||||||||||
| Total reportable segments | 62,669 | 58,483 | 120,173 | 132,331 | ||||||||||||
| Unallocated Corporate and Other | (6,456 | ) | (3,439 | ) | (15,524 | ) | (11,373 | ) | ||||||||
| Consolidated | $ | 56,213 | $ | 55,044 | $ | 104,649 | $ | 120,958 | ||||||||
| Adjusted EBITDA margin from continuing operations | ||||||||||||||||
| Consumer Products | 13.3 | % | 10.6 | % | 14.2 | % | 11.4 | % | ||||||||
| Building Products | 30.0 | % | 30.3 | % | 29.3 | % | 33.2 | % | ||||||||
| Consolidated | 20.5 | % | 18.5 | % | 19.7 | % | 19.8 | % | ||||||||
| Equity income by unconsolidated affiliate | ||||||||||||||||
| WAVE (1) | $ | 24,564 | $ | 21,428 | $ | 52,466 | $ | 49,743 | ||||||||
| ClarkDietrich (1) | 9,730 | 13,748 | 18,474 | 30,476 | ||||||||||||
| Other (2) | 262 | 3,492 | (892 | ) | 3,873 | |||||||||||
| Consolidated | $ | 34,556 | $ | 38,668 | $ | 70,048 | $ | 84,092 | ||||||||
| ____________________ | |
| (1) | Equity income contributed by Worthington Armstrong Venture (“WAVE”) and Clarkwestern Dietrich Building Systems LLC (“ClarkDietrich) is associated with our Building Products reportable segment |
| (2) | Other includes the Company’s share of the equity earnings of Taxi Workhorse, LLC and the SES joint venture. |
A reconciliation from earnings before income taxes from continuing operations to the non-GAAP financial measure of adjusted EBITDA from continuing operations for the each of the periods presented is provided below.
| Three Months Ended | Six Months Ended | |||||||||||||||
| November 30, | November 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Earnings before income taxes (GAAP) | $ | 37,109 | $ | 24,543 | $ | 67,899 | $ | 60,333 | ||||||||
| Plus: Net loss attributable to noncontrolling interest | 251 | - | 496 | - | ||||||||||||
| Net earnings before income taxes attributable to controlling interest | 37,360 | 24,543 | 68,395 | 60,333 | ||||||||||||
| Interest expense, net | 1,033 | 472 | 1,522 | 1,546 | ||||||||||||
| EBIT (1) | 38,393 | 25,015 | 69,917 | 61,879 | ||||||||||||
| Corporate costs eliminated at Separation | - | 9,671 | - | 19,343 | ||||||||||||
| Restructuring and other expense, net | 2,620 | 6 | 3,778 | 6 | ||||||||||||
| Separation costs | - | 7,056 | - | 9,466 | ||||||||||||
| Loss on extinguishment of debt | - | - | - | 1,534 | ||||||||||||
| Gain on sale of assets in equity income | - | (2,780 | ) | - | (2,780 | ) | ||||||||||
| Adjusted EBIT (1) | 41,013 | 38,968 | 73,695 | 89,448 | ||||||||||||
| Depreciation and amortization | 11,927 | 12,215 | 23,757 | 24,290 | ||||||||||||
| Stock-based compensation (2) | 3,273 | 3,861 | 7,197 | 7,220 | ||||||||||||
| Adjusted EBITDA from continuing operations (non-GAAP) | $ | 56,213 | $ | 55,044 | $ | 104,649 | $ | 120,958 | ||||||||
| Earnings before income taxes margin (GAAP) | 13.5 | % | 8.2 | % | 12.8 | % | 9.9 | % | ||||||||
| Adjusted EBITDA margin from continuing operations (non-GAAP) | 20.5 | % | 18.5 | % | 19.7 | % | 19.8 | % | ||||||||
| ____________________ | |
| (1) | EBIT and adjusted EBIT are non-GAAP financial measures. However, these measures are not used by management to evaluate the Company's performance, engage in financial and operational planning, or to determine incentive compensation. Instead, they are included as subtotals in the reconciliation of earnings (loss) before income taxes to adjusted EBITDA from continuing operations, which is a non-GAAP financial measure used by management. |
| (2) | Excludes |
WORTHINGTON ENTERPRISES, INC.
USE OF NON-GAAP FINANCIAL MEASURES AND DEFINITIONS
NON-GAAP FINANCIAL MEASURES. These materials include certain financial measures that are not calculated and presented in accordance with accounting principles generally accepted in the United States (“GAAP”). The non-GAAP financial measures typically exclude items that management believes are not reflective of, and thus should not be included when evaluating the performance of the Company’s ongoing operations. Management uses the non-GAAP financial measures to evaluate the Company’s performance, engage in financial and operational planning, and determine incentive compensation. Management believes these non-GAAP financial measures provide useful supplemental information and additional perspective on the performance of the Company’s ongoing operations and should not be considered as an alternative to the comparable GAAP measure. Additionally, management believes these non-GAAP financial measures allow for meaningful comparisons and analysis of trends in the Company’s businesses and enable investors to evaluate operations and future prospects in the same manner as management.
The following provides an explanation of each non-GAAP financial measure presented in these materials:
Adjusted operating income (loss) is defined as operating income (loss) excluding the items listed below, to the extent naturally included in operating income (loss).
Adjusted net earnings from continuing operations is defined as net earnings from continuing operations attributable to controlling interest (“net earnings from continuing operations”) excluding the after-tax effect of the excluded items outlined below.
Adjusted earnings per diluted share from continuing operations (“Adjusted EPS from continuing operations”) is defined as adjusted net earnings from continuing operations divided by diluted weighted-average shares outstanding).
Adjusted EBITDA is defined as adjusted earnings before interest, taxes, depreciation, and amortization. EBITDA is calculated by adding or subtracting, as appropriate, interest expense, net, income tax expense, depreciation, and amortization to/from net earnings from continuing operations attributable to controlling interest, which is further adjusted to exclude impairment and restructuring charges (gains) as well as other items that management believes are not reflective of, and thus should not be included when evaluating the performance of its ongoing operations, as outlined below. Adjusted EBITDA also excludes stock-based compensation due to its non-cash nature, which is consistent with how management assesses operating performance. At the segment level, adjusted EBITDA includes expense allocations for centralized corporate back-office functions that exist to support the day-to-day business operations. Public company and other governance costs are held at the corporate-level.
Adjusted EBITDA margin is calculated by dividing adjusted EBITDA by net sales.
Exclusions from Non-GAAP Financial Measures
Management believes it is useful to exclude the following items from the non-GAAP financial measures presented in this report for its own and investors’ assessment of the business for the reasons identified below. Additionally, management may exclude other items from the Non-GAAP financial measures that do not occur in the ordinary course of our ongoing business operations and note them in the reconciliation from earnings before income taxes from continuing operations to the non-GAAP financial measure of adjusted EBITDA from continuing operations.
- Impairment charges are excluded because they do not occur in the ordinary course of our ongoing business operations, are inherently unpredictable in timing and amount, and are non-cash, which we believe facilitates the comparison of historical, current and forecasted financial results.
- Restructuring activities, which can result in both discrete gains and/or losses, consist of established programs that are not part of our ongoing operations, such as divestitures, closing or consolidating facilities, employee severance (including rationalizing headcount or other significant changes in personnel), and realignment of existing operations (including changes to management structure in response to underlying performance and/or changing market conditions). These items are excluded because they are not part of the ongoing operations of our underlying business.
- Separation costs, which consist of direct and incremental costs incurred in connection with the completed Separation are excluded as they are one-time in nature and are not expected to occur in period following the Separation. These costs include fees paid to third-party advisors, such as investment banking, audit and other advisory services as well as direct and incremental costs associated with the Separation of shared corporate functions. Results in the current fiscal year also include incremental compensation expense associated with the modification of unvested short and long-term incentive compensation awards, as required under the employee matters agreement executed in conjunction with the Separation.
- Loss on early extinguishment of debt is excluded because it does not occur in the normal course of business and may obscure analysis of trends and financial performance. Additionally, the amount and frequency of this type of charge is not consistent and is significantly impacted by the timing and size of debt extinguishment transactions.
- Corporate costs eliminated at Separation are those costs that were related to corporate resources that, post-Separation, no longer exist to support the Company’s continuing operations, but were not clearly identifiable to the former Steel Processing segment.
Sonya L. Higginbotham
Senior Vice President
Chief of Corporate Affairs, Communications and Sustainability
614.438.7391
sonya.higginbotham@wthg.com
Marcus A. Rogier
Treasurer and Investor Relations Officer
614.840.4663
marcus.rogier@wthg.com
200 West Old Wilson Bridge Rd.
Columbus, Ohio 43085
WorthingtonEnterprises.com
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