v3.26.3
Operating Segments
 6 Months Ended
Aug. 31, 2026
Segment Reporting [Abstract]  
Operating Segments
7. Operating Segments
Segment Information
Our Chief Executive Officer, who is the chief operating decision maker ("CODM"), reviews financial information presented on an operating segment basis for purposes of making operating decisions and assessing financial performance. Sales and operating income are the primary measures used by the CODM to evaluate segment operating performance and to allocate resources to the AZZ Metal Coatings and the AZZ Precoat Metals segments. The CODM uses income before income taxes as the primary measure to evaluate performance and allocate resources to the AZZ Infrastructure Solutions segment. The CODM assesses these metrics and compares actuals to budgeted and forecasted values to evaluate segment operating performance and allocate resources to the operating segments. Expenses related to certain centralized administration or executive functions that are not specifically related to an operating segment are included in Corporate.
A summary of each of our operating segments is as follows:
AZZ Metal Coatings — provides hot-dip galvanizing, spin galvanizing, powder coating, anodizing and plating, and other metal coating applications to the steel fabrication industry and other industries through facilities located throughout North America. Hot-dip galvanizing is a metallurgical manufacturing process in which molten zinc reacts with steel, which provides corrosion protection and extends the lifecycle of fabricated steel for several decades.
AZZ Precoat Metals — provides coil coating application of protective and decorative coatings and related value-added downstream processing for steel and aluminum coils. Primarily serving the construction; infrastructure; transportation; heating, ventilation, and air conditioning (HVAC) and appliances; container; and other end markets, the coil coating process emphasizes sustainability and enhanced product lifecycles. It involves cleaning, treating, painting, and curing metal coils as a flat material before they are cut, formed, and fabricated into finished products. This highly efficient method optimizes waste through tight film control and improves final product performance by painting and curing the substrates under conditions unmatched by other application processes.
AZZ Infrastructure Solutions — represents our 40% non-controlling interest in the AVAIL JV, as well as other expenses directly related to AIS receivables and liabilities that were retained following the divestiture of the AIS business.
For the six months ended August 31, 2026, the AVAIL JV's operations consisted primarily of Rig-A-Lite Group ("Rig-A-Lite"), a provider of industrial and hazardous-duty lighting products, and WSI Brazil, a provider of specialized welding, maintenance, and asset integrity solutions serving the power generation, oil and gas, and industrial markets. On May 14, 2026, AVAIL completed the sale of Rig-A-Lite. For the three months ended August 31, 2025, the AVAIL JV's operations consisted of Rig-A-Lite and WSI. For the six months ended August 31, 2025, AVAIL's operations also included the Electrical Products Group ("EPG"), which was sold in the first quarter of fiscal 2026. See Note 8 for more information about the AVAIL JV.
The following tables contain operating segment data for the three and six months ended August 31, 2026 and 2025 (in thousands):
Three Months Ended August 31, 2026
Metal
Coatings		Precoat
Metals
Infrastructure Solutions(1)
Total
Sales$233,519 $253,373 $— $486,892 
Cost of sales163,466 201,300 — 364,766 
Selling, general and administrative5,968 8,739 — 14,707 
Operating income$64,085 $43,334 — 107,419 
Equity in earnings of unconsolidated subsidiary(4)
6,789 6,789 
Income before income taxes$6,789 114,208 
Reconciliation to consolidated income before income taxes
Corporate selling, general and administrative expenses(5)
(23,638)
Interest expense(10,807)
Other income27 
Consolidated income before income taxes$79,790 
See notes below tables.
Six Months Ended August 31, 2026
Metal
Coatings		Precoat
Metals
Infrastructure Solutions(1)
Total
Sales$443,824 $491,598 $— $935,422 
Cost of sales310,918 390,209 — 701,127 
Selling, general and administrative12,270 16,520 — 28,790 
Operating income$120,636 $84,869 — 205,505 
Equity in earnings of unconsolidated subsidiary(4)
7,298 7,298 
Income before income taxes$7,298 212,803 
Reconciliation to consolidated income before income taxes
Corporate selling, general and administrative expenses(5)
(44,691)
Interest expense(22,071)
Other expense(233)
Consolidated income before income taxes$145,808 
See notes below tables.
Three Months Ended August 31, 2025
Metal
Coatings		Precoat
Metals
Infrastructure Solutions(1)
Total
Sales$189,984 $227,291 $— $417,275 
Cost of sales132,923 183,060 — 315,983 
Selling, general and administrative5,355 7,710 26 13,091 
Operating income (loss)$51,706 $36,521 (26)88,201 
Equity in earnings of unconsolidated subsidiary(4)
59,345 59,345 
Income before income taxes$59,319 147,546 
Reconciliation to consolidated income before income taxes
Corporate selling, general and administrative expenses(19,740)
Interest expense(13,665)
Other income188 
Consolidated income before income taxes$114,329 
See notes below tables.
Six Months Ended August 31, 2025
Metal
Coatings		Precoat
Metals
Infrastructure Solutions(1)
Total
Sales$377,199 $462,038 $— $839,237 
Cost of sales(2)
263,279 370,536 — 633,815 
Selling, general and administrative(3)
11,482 15,627 106 27,215 
Operating income (loss)$102,438 $75,875 (106)178,207 
Equity in earnings of unconsolidated subsidiary(4)
232,868 232,868 
Income before income taxes$232,762 411,075 
Reconciliation to consolidated income before income taxes
Corporate selling, general and administrative expenses(40,197)
Interest expense(32,228)
Other income1,515 
Consolidated income before income taxes$340,165 
(1)
For the AZZ Infrastructure Solutions segment, the CODM uses only income before taxes as the measure to allocate resources and assess segment performance. Infrastructure Solutions segment includes the equity in earnings from our investment in the AVAIL JV, as well as other expenses related to receivables and liabilities that were retained following the sale of the AIS business.
(2)
For the six months ended August 31, 2025, the AZZ Metal Coatings segment includes restructuring charges of $3.8 million. See Note 17.
(3)
Includes stock-based compensation expense recognized during the six months ended August 31, 2025 upon the adoption of the Executive Retiree LTI Program of $2.2 million, of which $0.4 million and $1.8 million are included in the AZZ Metal Coatings segment and the Corporate segment, respectively. See Note 15.
(4)
On May 14, 2026, AVAIL completed the sale of Rig-A-Lite. The three months ended August 31, 2026 include $7.9 million from the sale of Rig-A-Lite, partially offset by a $1.3 million decrease to a previously recognized gain on the sale of AVAIL's WSI business. The six months ended August 31, 2026 include $7.9 million, which represents the gain related to the sale of Rig-A-Lite.
During the first quarter of fiscal 2026, AVAIL completed the sale of the EPG. The three and six months ended August 31, 2025 include $61.6 million and $227.5 million, respectively, which represent the gain related to the sale of the EPG, partially offset by an impairment loss on the AVAIL JV and an adjustment related to a change in AVAIL's transfer pricing policy. For additional information about the AVAIL JV, see Note 8.
(5)
For the three and six months ended August 31, 2026, the Corporate segment includes $2.8 million of acquisition costs related to the Seattle Galvanizing acquisition. See Note 2.
Asset balances by operating segment were as follows (in thousands):
As of
Segment assets(1)
August 31, 2026February 28, 2026
Metal Coatings(2)
$724,758 $604,107 
Precoat Metals(3)
1,584,248 1,562,994 
Infrastructure Solutions - Investment in Joint Venture11,464 19,960 
Total reportable segment assets2,320,470 2,187,061 
Corporate17,488 26,413 
Consolidated assets$2,337,958 $2,213,474 
(1)
Segment assets include identifiable intangible assets associated with each reportable segment. The related amortization expense for intangible assets is not allocated to the segments.
(2)
Identifiable intangible assets related to the AZZ Metal Coatings of $52.5 million and $35.0 million, net of accumulated amortization, as of August 31, 2026 and February 28, 2026, respectively, are included in segment assets. The associated amortization expense is not allocated to the segment.
(3)
Identifiable intangible assets related to the AZZ Precoat Metals of $365.5 million and $374.8 million, net of accumulated amortization, as of August 31, 2026 and February 28, 2026, respectively, are included in segment assets. The associated amortization expense is not allocated to the segment.
Depreciation and amortization expense by segment for the three and six months ended August 31, 2026 and 2025 was as follows (in thousands):
Three Months Ended August 31,Six Months Ended August 31,
Depreciation and amortization2026202520262025
Metal Coatings$7,472 $6,830 $14,738 $13,490 
Precoat Metals10,487 9,424 20,709 18,546 
Total reportable segment depreciation and amortization17,959 16,254 35,447 32,036 
Corporate6,209 6,118 12,240 12,163 
Consolidated depreciation and amortization$24,168 $22,372 $47,687 $44,199 
Financial Information About Geographical Areas
The geographic area is based on the location of the operating facility and no customer accounted for 10% or more of consolidated sales. Financial information about geographical areas for the periods presented was as follows (in thousands):
Three Months Ended August 31,Six Months Ended August 31,
Sales2026202520262025
United States$472,396 $404,398 $908,386 $815,393 
Canada14,496 12,877 27,036 23,844 
Total sales$486,892 $417,275 $935,422 $839,237 
As of
Long-lived assetsAugust 31, 2026February 28, 2026
United States$686,934 $647,182 
Canada20,951 21,687 
Total$707,885 $668,869