Financial Performance - Net sales for the three months ended November 30, 2025, were $327,452,000, a 19.5% increase from $274,046,000 in the same period of 2024[27] - Gross profit for the six months ended November 30, 2025, was $166,913,000, compared to $136,554,000 for the same period in 2024, reflecting a 22.3% increase[27] - Operating income for the three months ended November 30, 2025, was $12,264,000, significantly up from $3,521,000 in the prior year, marking a 248.5% increase[27] - Net earnings attributable to controlling interest for the six months ended November 30, 2025, were $62,476,000, compared to $52,513,000 in 2024, representing an increase of 18.5%[27] - Total reportable operating segments' net sales for the six months ended November 30, 2025, were $631,159 million, compared to $531,354 million in the same period of 2024, reflecting an increase of approximately 18.8%[76] - Adjusted EBITDA for the six months ended November 30, 2025, was $125,538 million, compared to $104,649 million for the same period in 2024, indicating an increase of about 20%[76] Cash and Liquidity - Cash and cash equivalents at the end of the period were $180,288,000, down from $250,075,000 at the beginning of the period, indicating a decrease of 28%[33] - The company reported a net cash provided by operating activities of $51,518,000 for the three months ended November 30, 2025, compared to $49,053,000 in the prior year, a 5.0% increase[33] - Net cash provided by operating activities was $92.6 million for the six months ended November 30, 2025, an increase of $2.4 million compared to the prior year[158] - Net cash used by investing activities was $117.9 million during the six months ended November 30, 2025, primarily due to the acquisition of Elgen and capital expenditures[159] - The company had no outstanding borrowings against its $500.0 million Credit Facility as of November 30, 2025, indicating full borrowing capacity available for future use[164] Assets and Liabilities - Total assets increased to $1,753,333,000 as of November 30, 2025, compared to $1,695,152,000 as of May 31, 2025, reflecting a growth of 3.4%[25] - Total liabilities rose to $790,310,000 from $756,915,000, an increase of 4.4%[25] - The total liabilities for unallocated corporate and other as of November 30, 2025, were $300,746 million, down from $368,128 million as of May 31, 2025, indicating a reduction of about 18.3%[77] - The fair value of long-term debt was reported at $279,267 million as of November 30, 2025, compared to $263,547 million as of May 31, 2025[101] Shareholder Returns - The company declared cash dividends of $0.19 per common share for the three months ended November 30, 2025, up from $0.17 in the same period of 2024[27] - The company declared cash dividends totaling $9.432 million for the six months ended November 30, 2025, consistent with the previous period[58] - The total number of common shares purchased from September 1 to November 30, 2025, was 286,578, with an average price of $55.65 per share[177] - The maximum number of common shares that may yet be purchased under publicly announced plans or programs is 5,015,000 as of November 30, 2025[177] Acquisitions and Divestitures - The company has an 80% controlling interest in Halo, which was acquired on February 1, 2024, contributing to its consolidated financial results[36] - The company acquired Elgen for $91,184 million on June 18, 2025, which is expected to enhance the Building Products segment's performance[79] - The company signed an agreement to acquire LSI for approximately $205 million, expected to close in January 2026, which will enhance its Building Products segment[102] - The company divested its 49% interest in the SES joint venture, resulting in a loss of $2,950 million recorded in the consolidated statement of earnings for the six months ended November 30, 2025[46] Operational Performance - WAVE's net sales for Q2 2026 were $120,733 million, an increase from $114,627 million in Q2 2025, with operating income rising to $57,466 million from $53,366 million[49] - ClarkDietrich reported net sales of $282,615 million in Q2 2026, down from $290,447 million in Q2 2025, with operating income decreasing to $15,880 million from $37,498 million[49] - Other segment net sales were $73,345 million in Q2 2026, down from $87,916 million in Q2 2025, resulting in an operating loss of $996 million compared to a loss of $17 million in the prior year[49] Market Conditions - The Federal Reserve lowered the federal funds target range to 3.50% – 3.75% in December 2025, impacting consumer sentiment and commercial construction activity[116] - The company experienced a softer macroeconomic environment, with high financing costs constraining new residential construction and impacting demand in Building Products[116] - U.S. residential construction spending was approximately 5% below prior year levels, while non-residential construction remained stable[121] - Builder sentiment, measured by the HMI, was at 38 in November 2025, marking the 19th consecutive month below the 50 threshold, with 41% of builders reporting price cuts[121] Tax and Compliance - The estimated annual effective tax rate (ETR) for both the six months ended November 30, 2025, and November 30, 2024, was 24.1%[68] - Income tax expense for the three months ended November 30, 2025, was $8.8 million, a decrease of 3.3% from $9.1 million in the prior year quarter[145] - The company remains in compliance with financial covenants of its debt agreements, which do not include credit rating triggers or material adverse change provisions[164] Risk Management - The company is managing exposure to interest rate, foreign currency exchange, and commodity price risks through various derivative financial instruments[85] - Risk factors have not changed significantly from those disclosed in the 2025 Form 10-K, and additional risks may also materially affect the company's business[174] - The company is involved in various judicial and administrative proceedings but does not expect any material adverse effects on its business or financial position[173]
Worthington Industries(WOR_V) - 2026 Q2 - Quarterly Report