Worthington Industries(WOR) - 2025 Q4 - Annual Results

Financial Performance - Net sales for Q4 fiscal 2025 were $317.9 million, a slight decrease of 0.3% compared to $318.8 million in Q4 fiscal 2024[4] - Net earnings from continuing operations increased 111% to $3.6 million, while adjusted EBITDA from continuing operations grew 35% to $85.1 million[4] - Adjusted EPS from continuing operations (diluted) increased from $0.74 to $1.06 per share[4] - Operating cash flow increased 38% to $62.4 million, and free cash flow rose 46% to $49.3 million[4] - Net earnings for the three months ended May 31, 2025, were $3,614,000, a significant improvement from a net loss of $32,049,000 in the same period of 2024[28] - The company reported a GAAP net earnings of $96,053,000 for the twelve months ended May 31, 2025, compared to $35,243,000 for the same period in 2024[38] - The adjusted EBITDA for the twelve months ended May 31, 2025, was $263,489,000, compared to $250,999,000 for the same period in 2024, indicating a positive trend in operational performance[36] Cash Flow and Dividends - The company ended the quarter with cash of $250.1 million, an increase of $5.9 million from the previous year[10] - Cash and cash equivalents increased to $250,075 thousand as of May 31, 2025, compared to $244,225 thousand in 2024, showing a growth of 2.9%[26] - The company declared cash dividends of $0.17 per share for the three months ended May 31, 2025, compared to $0.16 per share in the same period of 2024[24] - The company paid dividends totaling $33,903,000 for the twelve months ended May 31, 2025, compared to $56,819,000 in the previous year, reflecting a reduction in dividend payments[28] Segment Performance - Building Products segment net sales increased by $38.8 million, or 25.2%, to $192.3 million, driven by higher volumes and contributions from the Ragasco acquisition[13] - The Consumer Products segment reported net sales of $125,568,000 for the three months ended May 31, 2025, slightly up from $125,336,000 in the same period of 2024[31] - The Building Products segment achieved net sales of $192,316,000 for the three months ended May 31, 2025, compared to $153,551,000 in the same period of 2024, marking an increase of 25.2%[31] Impairment and Losses - The impairment of goodwill and long-lived assets for the three months ended May 31, 2025, was $50,813 thousand, up from $32,975 thousand in 2024[24] - The company incurred impairment charges of $50,813,000 for long-lived assets in the three months ended May 31, 2025, compared to $32,975,000 in the same period of 2024[34] Operational Metrics - Total assets rose to $1,695,152 thousand as of May 31, 2025, up from $1,638,637 thousand in 2024, indicating an increase of 3.4%[26] - Total liabilities increased to $756,915 thousand as of May 31, 2025, compared to $747,625 thousand in 2024, reflecting a rise of 1.8%[26] - Net cash provided by operating activities for the twelve months ended May 31, 2025, was $209,744,000, down from $289,976,000 in 2024, representing a decrease of approximately 27.7%[28] - The company’s operating cash flow conversion for the three months ended May 31, 2025, was 1,610%, a significant increase from (143%) in the same period of 2024[38] Acquisitions and Corporate Actions - The acquisition of Elgen Manufacturing was completed for approximately $93 million, enhancing the company's position in the HVAC market[4] - The company repurchased 200,000 shares of common stock for $9.8 million, with 5,365,000 shares remaining on the repurchase authorization[4] Tax and Adjustments - The effective tax rate for the three months ended May 31, 2025, was 54.9%, significantly higher than the effective tax rate of (18.8%) for the same period in 2024[34] - Adjusted operating income is defined as operating income excluding specific items, providing a clearer view of ongoing performance[41] - Adjusted net earnings from continuing operations exclude after-tax effects of certain items, offering a more accurate reflection of profitability[42] - Adjusted EBITDA from continuing operations is used to evaluate segment performance and overall profitability, excluding non-recurring items[43] - Free cash flow is defined as net cash flows from operating activities less investments in property, plant, and equipment, indicating liquidity[44] - Free cash flow conversion measures how much of adjusted net earnings is converted into cash, highlighting cash generation efficiency[45] - Impairment charges and restructuring activities are excluded from non-GAAP measures as they do not reflect ongoing operations[46] - Separation costs related to corporate functions are excluded as they are one-time in nature and not expected to recur[46] - Non-cash charges and losses on extinguishment of debt are excluded to avoid obscuring financial performance analysis[47] - Pension settlement charges and one-time tax effects of separation are excluded due to their non-recurring nature[47] - Corporate costs eliminated at separation reflect overhead costs that no longer exist post-separation, impacting financial reporting[47]