v3.26.3
Segment Information
 3 Months Ended
Aug. 31, 2026
Segment Reporting [Abstract]  
Segment Information

Note 17 – Segment Information

 

The Company’s CODM is Worthington Steel’s CEO. The Company has determined that it has only one operating segment and therefore one reportable segment after considering several sources of information, including the Company’s internal organizational structure, the basis on which budgets and forecasts are prepared, the financial information that the Company’s CODM reviews in evaluating company performance and determining how resources should be allocated, and how the Company releases information to the public and analysts. The CODM manages all business activities on a consolidated basis, and as a result, the Company has concluded that there is only one operating segment and therefore one reportable segment.

The Company’s one reportable segment serves its customers primarily by processing flat-rolled steel coils, sourced primarily from various North American steel mills, into the precise type, thickness, length, width, shape, and surface quality required by customer specifications, and by distributing steel and other metal products and providing related processing services to customers primarily in North America and Europe, sourcing material from a global network of steel mills and other producers. The Company generates a substantial percentage of its revenue from selling steel on a direct basis, whereby it is exposed to the risks and rewards of ownership of the material while in its possession. Additionally, the Company toll processes steel under fee-for-service arrangements on customer-owned material.

The measure of segment profit or loss for the Company’s one reportable segment is net earnings, consistent with the measure the Company used for its single reportable segment prior to the Kloeckner Acquisition. The CODM uses net earnings to assess segment performance and to decide how and where to allocate resources and reinvest profits, including in capital expenditures, business and/or asset acquisitions, market share expansion, talent, technology, share repurchases, and dividends. The measure of segment assets for the Company's reportable segment is total assets, as reported on the Company's condensed consolidated balance sheets.

The Company regularly provides the CODM a reporting package structured similarly to the condensed consolidated statements of earnings. The CODM reviews net earnings as the key measure of profit or loss and reviews significant expenses on a basis consistent with the presentation in the condensed consolidated statements of earnings, with the exception of cost of goods sold, which is further disaggregated.

The following table presents the significant expenses that are regularly provided to the CODM for the reportable segment and the required disclosable amounts that are included in net earnings for the three months ended August 31, 2026:

 

 

Three Months Ended

 

 

August 31,

 

(In millions)

2026

 

 

2025

 

Net sales

$

2,726.6

 

 

$

872.9

 

Cost of goods sold:

 

 

 

 

 

Material cost

 

2,102.7

 

 

 

583.5

 

Direct labor, manufacturing expenses, and other (1)

 

362.7

 

 

 

174.2

 

Total cost of goods sold

 

2,465.4

 

 

 

757.7

 

Gross margin

 

261.2

 

 

 

115.2

 

Selling, general and administrative expense

 

208.8

 

 

 

67.9

 

Restructuring and other (income) expense, net

 

(3.6

)

 

 

(1.0

)

Operating income

 

56.0

 

 

 

48.3

 

Other income (expense):

 

 

 

 

 

Miscellaneous income (expense), net

 

(10.5

)

 

 

0.2

 

Interest expense, net

 

(38.8

)

 

 

(2.9

)

Equity in net income of unconsolidated affiliate

 

5.3

 

 

 

6.4

 

Earnings before income taxes

 

12.0

 

 

 

52.0

 

Income tax expense

 

12.1

 

 

 

13.4

 

   Net earnings (loss) from continuing operations

 

(0.1

)

 

 

38.6

 

   Net loss from discontinued operations

 

(4.9

)

 

 

-

 

Net earnings (loss)

 

(5.0

)

 

 

38.6

 

Net earnings attributable to noncontrolling interests

 

5.0

 

 

 

1.8

 

Net earnings (loss) attributable to controlling interest

$

(10.0

)

 

$

36.8

 

 

(1)
Includes expenses related to manufacturing profit sharing and bonus.