SEC Document

 

prepaid expenses and headquarters’ property and equipment. These corporate and other assets and expenses reconcile reportable segment data to total consolidated income before income taxes, interest expense and earnings before interest and taxes.

We reflect income from our joint ventures on the equity method, and receive royalties from our licensees.

The following tables reflect the results of our reportable segments consistent with our management philosophy, and represent the information we utilize, in conjunction with various strategic, operational and other financial performance criteria, in evaluating the performance of our portfolio of businesses.  

 

 

 

Three Months Ended

 

 

 

August 31,

 

 

August 31,

 

 

 

2017

 

 

2016

 

 

 

(In thousands)

 

Net Sales

 

 

 

 

 

 

 

 

Industrial Segment

 

$

729,768

 

 

$

675,840

 

Consumer Segment

 

 

427,144

 

 

 

399,887

 

Specialty Segment

 

 

188,482

 

 

 

176,336

 

Consolidated

 

$

1,345,394

 

 

$

1,252,063

 

Income Before Income Taxes (a)

 

 

 

 

 

 

 

 

Industrial Segment

 

 

 

 

 

 

 

 

Income Before Income Taxes (a)

 

$

88,902

 

 

$

89,266

 

Interest (Expense), Net (b)

 

 

(2,554

)

 

 

(1,837

)

EBIT (c)

 

$

91,456

 

 

$

91,103

 

Consumer Segment

 

 

 

 

 

 

 

 

(Loss) Income Before Income Taxes (a)

 

$

72,368

 

 

$

70,088

 

Interest Income (Expense), Net (b)

 

 

(196

)

 

 

(3

)

EBIT (c)

 

$

72,564

 

 

$

70,091

 

Specialty Segment

 

 

 

 

 

 

 

 

Income Before Income Taxes (a)

 

$

33,167

 

 

$

30,504

 

Interest Income, Net (b)

 

 

120

 

 

 

153

 

EBIT (c)

 

$

33,047

 

 

$

30,351

 

Corporate/Other

 

 

 

 

 

 

 

 

(Expense) Before Income Taxes (a)

 

$

(39,153

)

 

$

(41,383

)

Interest (Expense), Net (b)

 

 

(19,690

)

 

 

(17,253

)

EBIT (c)

 

$

(19,463

)

 

$

(24,130

)

Consolidated

 

 

 

 

 

 

 

 

(Loss) Income Before Income Taxes (a)

 

$

155,284

 

 

$

148,475

 

Interest (Expense), Net (b)

 

 

(22,320

)

 

 

(18,940

)

EBIT (c)

 

$

177,604

 

 

$

167,415

 

 

(a)

The presentation includes a reconciliation of Income (Loss) Before Income Taxes, a measure defined by generally accepted accounting principles ("GAAP") in the U.S., to EBIT.

(b)

Interest (expense), net includes the combination of interest (expense) and investment income/(expense), net.

(c)

EBIT is a non-GAAP measure, and is defined as earnings (loss) before interest and taxes.  We evaluate the profit performance of our segments based on income before income taxes, but also look to EBIT as a performance evaluation measure because interest expense is essentially related to acquisitions, as opposed to segment operations.  We believe EBIT is useful to investors for this purpose as well, using EBIT as a metric in their investment decisions.  EBIT should not be considered an alternative to, or more meaningful than, income before income taxes as determined in accordance with GAAP, since EBIT omits the impact of interest in determining operating performance, which represent items necessary to our continued operations, given our level of indebtedness.  Nonetheless, EBIT is a key measure expected by and useful to our fixed income investors, rating agencies and the banking community all of whom believe, and we concur, that this measure is critical to the capital markets' analysis of our segments' core operating performance.  We also evaluate EBIT because it is clear that movements in EBIT impact our ability to attract financing.  Our underwriters and bankers consistently require inclusion of this measure in offering memoranda in conjunction with any debt underwriting or bank financing.  EBIT may not be indicative of our historical operating results, nor is it meant to be predictive of potential future results.

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