Financial Performance - For the first quarter of fiscal 2025, net sales increased by $16.9 million, or 1.8%, to $951.6 million compared to $934.7 million in the prior-year period[107] - Gross profit for the first quarter of fiscal 2025 rose by $20.9 million, or 4.9%, to $449.3 million, with a gross profit margin increase of 140 basis points to 47.2%[108] - Operating profit for the first quarter of fiscal 2025 was $133.3 million, representing 14.0% of net sales, a slight increase from $132.9 million or 14.2% of net sales in the prior-year period[110] - Net income for the first quarter of fiscal 2025 increased by $6.1 million, or 6.1%, to $106.7 million, with diluted earnings per share rising by $0.14, or 4.4%, to $3.35[115] Cash Flow and Investments - Cash position at November 30, 2024, was $935.6 million, an increase of $89.8 million from August 31, 2024[94] - Cash flows from operating activities for the three months ended November 30, 2024, were $132.2 million, a decrease of $57.8 million from $190.0 million in the prior-year period[95] - The company invested $18.9 million in property, plant, and equipment during the three months ended November 30, 2024, compared to $14.6 million in the prior-year period[101] - Dividends paid on common stock were $4.5 million ($0.15 per share) for the three months ended November 30, 2024, compared to $4.1 million ($0.13 per share) in the prior-year period[103] Debt and Acquisitions - The company had an outstanding debt balance of $496.3 million as of November 30, 2024, with compliance to all covenants under financing arrangements[97] - On January 1, 2025, the company acquired QSC, LLC for $1.215 billion, funded through cash on hand and proceeds from the Term Loan Facility[105] Segment Performance - Acuity Brands Lighting net sales for Q1 fiscal 2025 increased by $9.6 million, or 1.1%, to $886.0 million compared to $876.4 million in the prior-year period[116] - Operating profit for Acuity Brands Lighting was $143.3 million, representing a margin of 16.2%, a slight decrease from $143.8 million and 16.4% in the prior-year period[117] - Acuity Intelligent Spaces net sales for Q1 fiscal 2025 rose by $9.3 million, or 14.5%, to $73.5 million compared to $64.2 million in the prior-year period[118] - Operating profit for Acuity Intelligent Spaces increased to $10.8 million, up from $5.3 million, reflecting a 103.8% increase[118] - The increase in Acuity Intelligent Spaces sales was primarily driven by higher sales of Distech products[118] - Higher labor and overhead costs impacted the operating profit of Acuity Brands Lighting, despite the increase in net sales[117] Accounting and Risk Management - The company has not reported any material changes in critical accounting estimates during the current period[120] - There are no significant changes to market risk exposure compared to previous disclosures[122] - The company has evaluated the effectiveness of its disclosure controls and procedures as of November 30, 2024, and concluded they are effective[124] - No changes in internal control over financial reporting have materially affected the company during the most recent fiscal quarter[126]

Core Insights - Acuity Brands, Inc. reported net sales of $951.6 million for the first quarter of fiscal 2025, reflecting a year-over-year increase of $16.9 million, or 1.8% [2][9] - The company achieved an operating profit of $133.3 million, a slight increase of $0.4 million, or 0.3% compared to the previous year [3][9] - Adjusted diluted earnings per share rose to $3.97, marking an increase of $0.25, or 6.7% from $3.72 in the prior year [4][9] Financial Performance - The first quarter of fiscal 2025 saw an adjusted operating profit of $158.7 million, up $4.8 million, or 3.1% from the previous year [3][9] - The adjusted operating profit margin improved to 16.7%, an increase of 20 basis points year-over-year [3][9] - Net cash from operating activities was reported at $132.2 million for the first three months of fiscal 2025 [10] Segment Performance - Acuity Brands Lighting generated net sales of $886.0 million, an increase of $9.6 million, or 1.1% compared to the prior year [5][29] - Acuity Intelligent Spaces reported net sales of $73.5 million, reflecting a significant increase of $9.3 million, or 14.5% year-over-year [7][29] - Operating profit for Acuity Brands Lighting was $143.3 million, a decrease of $0.5 million, or 0.3% compared to the prior year [6][29] Acquisition Details - The company completed the acquisition of QSC, LLC effective January 1, 2025, for a gross purchase price of $1.215 billion [11][9] - This acquisition is expected to enhance Acuity's capabilities in cloud-manageable audio, video, and control solutions [11] Cash Flow and Capital Allocation - The company repurchased approximately 17,000 shares of common stock for about $5 million during the quarter [10] - Cash and cash equivalents at the end of the period were reported at $935.6 million, up from $845.8 million at the beginning of the period [10][28]

Core Viewpoint - Acuity Brands (AYI) is positioned well to potentially beat earnings estimates in its upcoming quarterly report, supported by a solid history of exceeding expectations and positive analyst sentiment [1][6]. Earnings Performance - In the last reported quarter, Acuity Brands achieved earnings of $4.30 per share, surpassing the Zacks Consensus Estimate of $4.19 per share, resulting in a surprise of 2.63% [2]. - For the previous quarter, the company was expected to report earnings of $4.10 per share but delivered $4.15 per share, yielding a surprise of 1.22% [2]. Analyst Sentiment - Recent earnings estimates for Acuity Brands have been revised upward, indicating a positive outlook among analysts [3]. - The Zacks Earnings ESP for Acuity Brands is currently +1.16%, suggesting bullish sentiment regarding the company's earnings prospects [6]. Predictive Metrics - Stocks with a positive Earnings ESP and a Zacks Rank of 3 (Hold) or better have a historical success rate of nearly 70% in beating consensus estimates [4]. - The Most Accurate Estimate, which is part of the Earnings ESP calculation, reflects the latest analyst revisions and is considered more accurate than earlier consensus predictions [5]. Upcoming Earnings Report - Acuity Brands is expected to release its next earnings report on January 8, 2025, and the combination of a positive Earnings ESP and a Zacks Rank 3 indicates a strong possibility of another earnings beat [6].

Core Viewpoint - Acuity Brands, Inc. is expected to report strong first-quarter fiscal 2025 results, with earnings and revenues anticipated to increase year over year, driven by product innovations and market expansion efforts [1][4]. Earnings Expectations - The Zacks Consensus Estimate for earnings per share has risen to $3.88, reflecting a 4.3% increase from $3.72 reported in the same quarter last year [3]. - Revenue expectations are set at $951.9 million, indicating a 1.8% increase from the previous year [3]. Revenue Growth Drivers - The anticipated growth in earnings and revenues is attributed to improvements in product vitality, service levels, technological advancements, and new product innovations [4]. - The ABL segment is projected to see a 1% year-over-year revenue increase to $885.3 million, with various revenue streams within the segment expected to grow modestly [5]. Segment Performance - The Intelligent Spaces Group (ISG) segment is expected to experience significant growth, with revenues projected to increase by 15.1% year over year to $73.9 million [6]. Profitability Factors - Ongoing product introductions and enhancements are central to driving profitability, with a focus on diverse customer needs contributing to margin improvement [7]. - The adjusted EBITDA margin is expected to improve to 17.9% from 17.8% a year ago, reflecting effective cost management and pricing strategies [7]. Earnings Prediction Model - The company's earnings prediction model indicates a likely earnings beat, supported by a positive Earnings ESP of +1.16% and a Zacks Rank of 3 (Hold) [8].

Core Viewpoint - Analysts project Acuity Brands (AYI) will report quarterly earnings of $3.88 per share, a 4.3% increase year over year, with revenues expected to reach $951.85 million, reflecting a 1.8% increase from the same quarter last year [1] Earnings Estimates - There has been no revision in the consensus EPS estimate for the quarter over the last 30 days, indicating analysts' stable outlook on their initial forecasts [1][2] Revenue Estimates - The estimated revenues for Acuity Brands Lighting (ABL) are projected at $883.05 million, showing a year-over-year change of +0.8% [4] - The consensus estimate for revenues from the Intelligent Spaces Group (ISG) is $73.86 million, indicating a significant year-over-year increase of +15% [4] Profit Estimates - Analysts expect the adjusted operating profit for the Intelligent Spaces Group to be $13.98 million, up from $10.30 million reported in the same quarter last year [5] - The adjusted operating profit for Acuity Brands Lighting is anticipated to reach $154.04 million, slightly above the year-ago value of $153.80 million [5]

Core Points - Acuity Brands, Inc. will release its fiscal 2025 first-quarter results on January 8, 2025, at 6:00 a.m. (EST) [1] - The original release date was January 9, 2025, but was changed due to the observance of the National Day of Mourning for former President Jimmy Carter [2] - A conference call will follow the earnings release at 8:00 a.m. (EST), led by Neil Ashe, the Chairman, President, and CEO of Acuity Brands [1] Company Overview - Acuity Brands, Inc. is a market-leading industrial technology company focused on solving problems in spaces, light, and more [4] - The company operates through two business segments: Acuity Brands Lighting and Acuity Intelligent Spaces, providing products and services that enhance people's lives [4] - Acuity Brands aims for growth through innovative product development, including lighting, lighting controls, building management solutions, and location-aware applications [5] Operational Insights - The company is based in Atlanta, Georgia, with operations across North America, Europe, and Asia, supported by approximately 13,000 associates [6] - Acuity Brands focuses on customer-centric efficiencies to increase market share and deliver superior returns [5] - The company is committed to deploying capital aggressively to grow its business and enter attractive new verticals [5]

Core Viewpoint - Acuity Brands, Inc. is set to announce its fiscal 2025 first-quarter results on January 9, 2025, with a conference call led by CEO Neil Ashe [1]. Group 1: Financial Announcement - The fiscal 2025 first-quarter results will be released on January 9, 2025, at 6:00 a.m. (EST) [1]. - A conference call will follow at 8:00 a.m. (EST) to discuss the results [1]. - The earnings release and supplemental presentation will be available on the Company's Investor Relations website [2]. Group 2: Company Overview - Acuity Brands, Inc. is a market-leading industrial technology company focused on solving problems in spaces and lighting [4]. - The company operates through two segments: Acuity Brands Lighting and Lighting Controls (ABL) and the Intelligent Spaces Group (ISG) [4]. - Acuity Brands aims for growth through innovative products and services, including lighting and building management solutions [5]. Group 3: Operational Footprint - The company is based in Atlanta, Georgia, with operations across North America, Europe, and Asia [6]. - Acuity Brands employs over 12,000 associates dedicated to its mission [6].

Core Insights - Construction activity in the U.S. has been gaining momentum since July 2024, with October data showing increased residential construction spending both month over month and year over year [1][2] - Residential construction rose by 1.5% from September 2024 and 6.4% year over year, driven by homebuilder confidence and easing inflation [2][5] - Non-residential construction spending decreased by 0.4% month over month but increased by 3.9% year over year, supported by growth in sectors like public safety and healthcare [2][9] Construction Sector Overview - Private construction spending increased by 0.7% month over month and 5.1% year over year, with residential construction specifically up by 1.5% and 6.4% respectively [5][6] - Public construction spending saw a slight decline of 0.5% month over month but increased by 4.5% year over year, with both residential and non-residential activities showing growth [6][7] Growth Drivers - The Federal Reserve's recent interest rate cuts, from a benchmark of 5.25% to 5.50%, have positively impacted construction activity, with expectations of further cuts through 2025 [7][8] - The 30-year fixed-rate mortgage rate of 6.08% at the end of September 2024 has contributed to the increase in residential construction despite high inflation [8] Investment Opportunities - The Zacks Construction sector has risen by 29.8% year to date, outperforming the S&P 500 Index's 26.7% increase [11] - Recommended construction stocks include: - EMCOR Group, Inc. (EME): Up 134.4% year to date, with a Zacks Rank of 1 and projected 2025 sales and EPS growth of 6.6% and 7.2% respectively [12][13] - MasTec, Inc. (MTZ): Up 87.6% year to date, with a Zacks Rank of 1 and projected 2025 sales and EPS growth of 8.6% and 45.5% respectively [13][14] - Comfort Systems USA, Inc. (FIX): Up 138% year to date, with a Zacks Rank of 1 and projected 2025 sales and EPS growth of 7.9% and 20.8% respectively [14][15] - Sterling Infrastructure, Inc. (STRL): Up 121% year to date, with a Zacks Rank of 1 and projected 2025 sales and EPS growth of 7.3% and 8.1% respectively [15][16] - Acuity Brands, Inc. (AYI): Up 57.2% year to date, with a Zacks Rank of 2 and projected fiscal 2025 sales and EPS growth of 4.7% and 7.1% respectively [16][17]

Core Viewpoint - Acuity Brands reported strong Q4 fiscal 2024 earnings, surpassing estimates for the 18th consecutive quarter, despite facing challenges in its ABL segment [2][5][11]. Financial Performance - Adjusted EPS for Q4 was $4.30, exceeding the consensus estimate of $4.19 by 2.6%, and increased 8.3% from $3.97 in the prior year [5]. - Net sales reached $1.03 billion, beating the consensus mark of $1.01 billion by 2.3%, and improved 2.2% year-over-year [5]. - For the full fiscal year, net sales declined 2.8% to $3.84 billion, while adjusted operating profit rose 7.1% to $639.6 million [10]. Segment Performance - The ABL segment saw a modest sales increase of 1.1% to $955 million, while the ISG segment reported a robust 16.7% growth in net sales to $83.9 million [6][8]. - Adjusted operating profit for the ABL segment grew 8.3% to $171.9 million, with an adjusted operating margin of 18%, up 120 bps year-over-year [7]. - ISG's adjusted operating profit increased 51.4% to $21.5 million, with an adjusted operating margin of 22.9%, up 590 bps year-over-year [8]. Operational Efficiency - The company improved its operating margins significantly, with adjusted operating profit increasing 10% year-over-year to $178.5 million and an adjusted operating margin of 17.3%, up 120 bps [9]. - Cost-saving initiatives contributed to the expansion of gross and operating profit margins across segments [4]. Cash Flow and Financial Health - At the end of fiscal 2024, cash and cash equivalents stood at $845.8 million, up from $397.9 million at the end of fiscal 2023 [14]. - Cash provided by operating activities totaled $619.2 million, up 7.1% from the previous year, with free cash flow increasing 8.6% to $555.2 million [15]. Market Outlook - Despite strong profit growth, Acuity Brands faced a decline in net sales due to lower demand in the ABL segment, reflecting challenging market conditions [11]. - Estimates for the stock have been trending downward, but the company maintains a Zacks Rank 2 (Buy), indicating expectations for above-average returns in the coming months [16][18].

Market and Competitive Risks - Market and competitive pricing pressures may limit the company's ability to pass on cost increases to customers, potentially impacting revenue growth and profitability[37] - The company faces competition from global technology and building solution providers, as well as startups offering localized product sales and support services[52] Product and Innovation Risks - New product innovations may face risks such as inventory obsolescence, quality defects, and lower-than-expected profit margins, potentially leading to write-downs[38] - The company may face increased warranty costs and product liability claims if products are improperly designed, manufactured, packaged, or labeled[89] - The company does not maintain insurance for product recall events, and widespread product recalls could result in significant losses due to costs, destruction of inventory, penalties, and lost sales[90] Acquisitions and Alliances Risks - Acquisitions and alliances may not yield anticipated benefits due to integration challenges, unanticipated events, and potential impairment charges[39] - The company acquired KE2 Therm Solutions, Inc. in fiscal 2023, with goodwill of $15.0 million and gross intangible assets of $18.0 million[288][290] Supply Chain and Manufacturing Risks - Approximately 53% of the company's finished products are manufactured in Mexico, exposing it to risks from civil unrest or trade disputes with the U.S.[54] - Supply chain disruptions, particularly for microchips and electronics, have led to higher commodity prices and increased warehousing and freight costs[47] - The company sources 17% of its finished goods from Asia, which are subject to import tariffs that could increase costs[71] - The company operates seven manufacturing facilities in Mexico, some of which have Maquiladora status allowing duty-free import of raw materials[72] Customer and Sales Risks - No single customer accounted for more than 10% of net sales in fiscal 2024, but the loss of a major customer or channel partner could significantly impact the business[53] - Accounts receivable showed no single customer accounted for more than 10% of receivables at August 31, 2024, compared to one customer accounting for 10% in 2023[241] Cybersecurity and IT Risks - The company is highly dependent on software and automated systems, with potential risks from system failures, security breaches, and data privacy violations[57][59] - Cybersecurity threats, including ransomware and phishing attacks, are becoming more sophisticated and frequent, posing ongoing risks to the company's operations[59] - The company may incur significant costs or penalties due to disruptions or security breaches, potentially damaging its reputation and customer relationships[61] Workforce and Labor Risks - The company employs approximately 13,200 people as of August 31, 2024, with 9,600 employees in international locations[65] - Approximately 65% of the workforce is covered by union recognition and collective bargaining agreements, with 60% of these agreements expiring within one year[65] Legal and Regulatory Risks - The company is subject to various legal claims, including employment claims, product recall, personal injury, network security, data privacy, or property damage claims, and the actual costs of resolving these claims may exceed insurance coverage[88] - The company may be subject to intellectual property claims and could incur significant legal expenses to enforce its intellectual property rights[91] - The company is subject to various foreign and domestic laws and regulations, including the Clean Air Act, Clean Water Act, and GDPR[82] - The company faces risks related to climate change legislation and regulatory responses, including potential GHG emissions limits[83] - The company may be affected by evolving ESG (Environmental, Social, and Governance) laws and regulations, which could increase operational costs[86] Financial and Tax Risks - The company is exposed to foreign exchange rate fluctuations, with a hypothetical 10% depreciation of the Canadian dollar negatively impacting operating profit by approximately $8.6 million, while a 10% appreciation would favorably impact operating profit by approximately $10.5 million[196] - A hypothetical 10% decrease in the value of the Mexican peso in relation to the U.S. dollar would favorably impact operating profit by approximately $22.0 million, while a 10% increase would negatively impact operating profit by approximately $26.9 million[196] - The company's long-term debt consists primarily of fixed-rate senior unsecured notes, and a 10% increase in market interest rates would decrease the estimated fair value of these notes by approximately $11.7 million[195] - The company may face increased tax liabilities due to aggressive interpretations of tax laws and regulations in various jurisdictions, which could adversely impact financial position and results of operations[96] Pension and Retirement Risks - The company's defined benefit retirement plans are subject to risks, including changes in investment returns, discount rates, and regulatory changes, which could adversely affect results of operations and cash flows[102] Financial Performance and Metrics - Net sales for 2024 decreased to $3,841.0 million from $3,952.2 million in 2023, a decline of 2.8%[223] - Net income for 2024 increased to $422.6 million, up 22.1% from $346.0 million in 2023[223] - Cash and cash equivalents at the end of 2024 stood at $845.8 million, a significant increase from $397.9 million in 2023[221] - Total assets grew to $3,814.6 million in 2024, up from $3,408.5 million in 2023, an increase of 11.9%[221] - Gross profit for 2024 rose to $1,781.7 million, a 4.0% increase from $1,713.2 million in 2023[223] - Operating profit for 2024 increased to $553.3 million, up 16.9% from $473.4 million in 2023[223] - Net cash provided by operating activities in 2024 was $619.2 million, up 7.1% from $578.1 million in 2023[226] - Total current assets for 2024 were $1,871.5 million, a 34.2% increase from $1,395.2 million in 2023[221] - Diluted earnings per share for 2024 increased to $13.44, up 24.9% from $10.76 in 2023[223] - Repurchases of common stock in 2024 amounted to $88.7 million, a significant decrease from $266.6 million in 2023[226] - Net income for the year ended August 31, 2024, was $422.6 million, compared to $346.0 million in 2023 and $384.0 million in 2022[228] - Total inventories as of August 31, 2024, were $387.6 million, up from $368.5 million in 2023[244] - The company repurchased $87.8 million worth of common stock in 2024, compared to $269.3 million in 2023 and $511.7 million in 2022[228] - Cash dividends paid on common stock increased to $0.58 per share in 2024, up from $0.52 per share in 2023 and 2022[228] - Inventory reserves decreased to $25.6 million in 2024 from $25.8 million in 2023 and $30.9 million in 2022[245] - Total stockholders' equity increased to $2,378.8 million in 2024, up from $2,015.4 million in 2023 and $1,911.8 million in 2022[228] - Goodwill balance increased from $1,084.3 million in 2022 to $1,098.7 million in 2024, with additions from acquired businesses totaling $15.2 million[249] - Amortization expense for acquired intangible assets was $39.7 million in fiscal 2024, $42.1 million in 2023, and $41.0 million in 2022[250] - Expected amortization expense for the next five fiscal years: $32.1 million (2025), $29.8 million (2026), $28.3 million (2027), $24.2 million (2028), and $22.8 million (2029)[251] - The company recorded an impairment charge of $3.0 million for one indefinite-lived trade name asset in fiscal 2024[257] - In fiscal 2023, the company recorded an impairment charge of $14.0 million for six trade names[258] - Other long-term assets decreased from $49.5 million in 2023 to $32.1 million in 2024, primarily due to a reduction in deferred costs and other assets[260] - Other current liabilities increased from $186.7 million in 2023 to $206.3 million in 2024, driven by higher customer incentive programs and product warranty costs[261] - Other long-term liabilities remained relatively stable, increasing slightly from $129.2 million in 2023 to $130.1 million in 2024[263] - Shipping and handling costs decreased from $151.2 million in 2022 to $134.2 million in 2024[265] - Share-based payment expense increased from $37.4 million in 2022 to $46.6 million in 2024[268] - Share-based payment costs were $1.5 million, $1.5 million, and $4.8 million for the years ended August 31, 2024, 2023, and 2022, respectively[270] - Depreciation expense amounted to $51.4 million, $51.1 million, and $53.8 million during fiscal 2024, 2023, and 2022, respectively[271] - Total property, plant, and equipment, net, was $303.9 million as of August 31, 2024, compared to $297.6 million as of August 31, 2023[272] - R&D expense amounted to $102.3 million, $97.1 million, and $95.1 million during fiscal 2024, 2023, and 2022, respectively[273] - Advertising costs totaled $20.1 million, $21.9 million, and $19.3 million during fiscal 2024, 2023, and 2022, respectively[274] - Net interest (income) expense was $(4.5) million, $18.9 million, and $24.9 million for fiscal 2024, 2023, and 2022, respectively[276] - The company recorded a loss on the sale of its Sunoptics prismatic skylights business in fiscal 2023, amounting to $11.2 million[276] - Accumulated other comprehensive loss items were $(114.9) million as of August 31, 2024, compared to $(112.6) million as of August 31, 2023[281] - The company is assessing the impact of new accounting standards, including ASU 2023-09 and ASU 2023-07, on its financial statements[284][285] - The company sold its Sunoptics prismatic skylights business in November 2022, transferring assets with a total carrying value of $15.1 million and recognizing a pre-tax loss of $11.2 million[294] - The company recorded impairment charges of $3.0 million in fiscal 2024 for rebranding certain products in the ABL segment[298] - The company's cash and cash equivalents were $845.8 million as of August 31, 2024, compared to $397.9 million in 2023[297] - The estimated fair value of the company's senior unsecured public notes was $429.7 million as of August 31, 2024, up from $401.4 million in 2023[302] - The company's total lease cost for 2024 was $31.1 million, with operating lease cost accounting for $23.5 million[310] - The company's total debt as of August 31, 2024, was $496.2 million, consisting of senior unsecured public notes due December 2030[313] - The company entered into a $600.0 million five-year unsecured revolving credit facility on June 30, 2022, with the ability to request an additional $400.0 million of borrowing capacity[316] - The company recorded an impairment charge of $4.3 million in fiscal 2023 for retained assets related to the Sunoptics sale[312] - The company's weighted average discount rate for operating leases was 3.7% as of August 31, 2024, up from 3.5% in 2023[308] - The company's future undiscounted lease payments total $86.0 million, with a present value of lease liabilities at $77.3 million[309] - The company's Credit Agreement allows for a Maximum Leverage Ratio of 3.75, with a temporary increase to 4.25 in the event of a significant acquisition[318] - The company had no short-term borrowings under the Revolving Credit Facility as of August 31, 2024 and 2023[319] - The company was in compliance with all financial covenants under the Credit Agreement as of August 31, 2024, with additional borrowing capacity of $596.2 million[320] - The company's self-insurance program includes limits for workers' compensation, general liability, and auto liability, with annual revisions to liability estimates based on actuarial assessments[322] - The company is self-insured for the majority of its medical benefit plans, with annual evaluations of the lag factor used to estimate aggregate liability for claims[323] - The company leases certain buildings and equipment under noncancellable lease agreements[324] Business Segments and Strategy - The company's ABL segment focuses on increasing product vitality and driving productivity through innovative lighting solutions[232] - The ISG segment aims to make spaces smarter, safer, and greener by offering building management solutions and software[233] - The company's strategy includes growth through the development of innovative new products and services, including lighting, lighting controls, and building management systems[231] Environmental and Sustainability Risks - The company is exposed to regulatory, financial, and other risks related to climate change and sustainability matters, which could increase operational costs and affect financial condition[93] Internal Controls and Audits - The company's internal control over financial reporting was assessed as effective as of August 31, 2024, based on COSO criteria[201] - The company's consolidated financial statements for the years ended August 31, 2024, 2023, and 2022 were audited and found to be in conformity with U.S. GAAP[205] - Ernst & Young LLP issued an unqualified opinion on the company's internal control over financial reporting as of August 31, 2024[217] - The company's management is responsible for maintaining effective internal control over financial reporting[218] Product Warranty and Liability - Product warranty costs liabilities amounted to $37.5 million as of August 31, 2024[211]